SC: UP Development Authorities can't levy charges other than specified under UP Urban Planning and Development Act

07 May 2024 8:19 AM

By: Admin

On 28 April 2023 , Supreme Court of India, in a recent judgement Mathura Vrindavan Development Authority & Another Vs. Rajesh Sharma and Others, has held that the various development authorities of the state of Uttar Pradesh have the power to levy development charges/fees, but not other charges such as inspection fees, supervision fees, sub-division charges, impact fees, etc. that were not specified under Section 15(2-A) of the Uttar Pradesh Urban Planning and Development Act, 1973.

The case came up before the apex court in a batch of appeals filed against a judgement of the Allahabad High Court that quashed and set aside various demand notices by way of levy of inspection fees, supervision fees, sub-division charges, impact fees, etc., by the various development authorities of Uttar Pradesh.

The State Government and the Development Authorities had contended that they had the power to levy such charges/fees under Section 41 of the Act, 1973, which provides that the State Government can issue various directions to the Development Authorities for the efficient administration of the Act. However, the apex court held that the power exercisable under Section 41 by the State and the Development Authorities is supervisory in nature, and the State Government's power to issue directions is confined to matters of policy and not any other.

The court referred to its earlier judgements in Malti Kaul v. State of Haryana and Poonam Verma v. Delhi Development Authority, wherein it was held that Section 41 of the Act, 1973, only envisages that the Development Authorities would carry out such directions that may be issued by the State Government from time to time for the efficient administration of the Act, and any direction issued must have a nexus with the efficient administration of the Act.

The court further held that under the circumstances and in view of the above, the High Court had rightly set aside the various demand notices by way of levy of inspection fees, supervision fees, sub-division charges, impact fees, etc., and confirmed the levy of development charges/fees by the various Development Authorities of Uttar Pradesh.

The court also directed that any amount already paid by the respective original writ petitioners other than the development charges/fees and the charges provided under Section 15(2-A), now be refunded to the respective original writ petitioners with 6% interest per annum, within a period of twelve months from the date of the judgement, of course after adjusting development charges/fees.

The judgement has provided clarity on the power of the State Government and the Development Authorities in levying charges/fees under the Act, 1973, and has also provided relief to the original writ petitioners by directing the refund of amounts paid towards charges/fees that were not legally valid.

Mathura Vrindavan Development Authority & Another Vs. Rajesh Sharma and Others