Bruhat Bengaluru Mahanagara Palike (Amendment) Act, 2024

[06 March 2024]

An Act further to amend the Bruhat Bengaluru Mahanagara Palike Act, 2020.

Whereas it is expedient to amend the Bruhat Bengaluru Mahanagara Palike Act, 2020 (Karnataka Act 53 of 2020) for the purposes hereinafter appearing;

Be it enacted by the Karnataka State Legislature in the seventy fifth year of the Republic of India as follows:-

Section - 1. Short title and commencement :-

(1)     This Act may be called the Bruhat Bengaluru Mahanagara Palike (Amendment) Act, 2024.

(2)     It shall come into force at once.

Section - 2. Amendment of section 81 :-

In the Bruhat Bengaluru Mahanagara Palike Act, 2020 (Karnataka Act 53 of 2020) (hereinafter referred to as the Principal Act) in section 81, in sub-section (1), clause (d) shall be omitted.

Section - 3. Amendment of section 102 :-

In the Principal Act, in section 102, in subsection (1), the words "and appeals" shall be omitted.

Section - 4. Amendment of section 142 :-

In the Principal Act, in section 142, subsections (2) and (3) shall be omitted.

Section - 5. Amendment of section 143 :-

In the Principal Act, in section 143,-

(i)       in sub-section (1), after clause (c), the following shall be inserted namely:-

"(d) Collect such other cesses, along with the property tax, as may be prescribed by the Government to be collected under any other law in force and whose proceeds are required to come to the Corporation or otherwise."

(ii)      for sub-section (2), the following shall be substituted, namely:-

"(2) All monies collected in the form of cess or otherwise shall be credited to a separate head of account and shall be known as the respective cess fund or by the name of the tax or the levy under which it is collected."

(iii)     in sub-section (3), for the word "accessed", the word "assessed" shall be substituted.

(iv)    in sub-section (4), for the words "before the tribunal", the words "to the prescribed authority" shall be substituted.

Section - 6. Amendment of section 144 :-

In the Principal Act, in section 144,-

(i)       in sub-section (1), for the words "taxable annual value", the words "taxable capital value" shall be substituted.

(ii)      for sub-section (5), the following shall be substituted namely:-

"(5) The property tax shall be levied by the Bruhat Bengaluru Mahanagara Palike by a resolution passed at such percentage not more than ten percent of the taxable capital value of a building, vacant land or both. The taxable capital value of a building, vacant land or both shall be calculated by multiplying the corresponding "unit area value" with the total built-up area of a building, vacant land or both for ten months, minus the depreciation of three percent per year depending on the age of a building. The property tax assessed and levied under this section, once notified by the Government, shall stand revised as and when the property, building or land value is revised by a notification under section 45B of the Karnataka Stamp Act, 1957 (Karnataka Act 34 of 1957) by the Government.

Explanation: For the purpose of this section, "Unit Area Value" means the guidance value of the property or the land published under section 45B of the Karnataka Stamp Act, 1957 (Karnataka Act 34 of 1957) and with respect to the building standing on a plot it shall mean the value of building as may be assessed based on the per square foot construction cost minus the depreciation at the time of assessment:

Provided that, no such "unit area value" shall come into force unless it is previously published in the official Gazette for the information of the persons likely to be affected and an opportunity is provided to make representation or suggestions, if any, in this regard:

Provided further that, subject to such condition and in such circumstances as may be notified, the Chief Commissioner, Bruhat Bengaluru Mahanagara Palike, may, in lieu of the tax under sub-section (2), fix any lumpsum amount as annual tax, irrespective of zonal classification, in respect of,-

(a)      a built-up area having less than 300 sq.ft., in a slum area declared as such by the Karnataka Slum Clearance Board or the Chief Commissioner, Bruhat Bengaluru Mahanagara Palike;

(b)      an area used as parking area in a non-residential building and being charged for its use by the owner or the occupier: and

(c)      any other class of building or structure as he deems fit.

Provided also that, the depreciation shall be capped at a maximum of sixty percent.

Provided also that, the vacant land shall be assessed at a rate not less than 0.025 percent (rupees twenty five per lakh) and not more than five percent of the taxable capital value of the land.

Provided also that, after the taxable capital value based property tax system is brought into force and there is no revision of the values of the properties or land under section 45B of the Karnataka Stamp Act, 1957 (Karnataka Act 34 of 1957) in a year, the property tax shall stand enhanced by five percent every such year.

Provided also that, as and when the Government notifies value of land and building under section 45B of Karnataka Stamp Act, 1957 (Karnataka Act 34 of 1957) the revised property tax rates based on the new revised value of properties or land shall be calculated and compared with the prevailing property tax rates and the higher of the two shall be adopted."

(iii)     in sub-section (8), the third proviso shall be omitted.

(iv)    in sub-section (11), the words "unit area value and" shall be omitted.

(v)      in sub-section (12), the word, "random" shall be omitted.

(vi)    in sub-section (13), the word, "random" shall be omitted.

(vii)   in sub-section (15),-

(a)      the word, "random" shall be omitted; and

(b)      for clause (b), the following shall be substituted, namely:-

"(b) if any property or land is liable to pay property tax but remains unassessed and outside the taxable property records list or upon reassessment, the property tax is found more than five percent than the tax remitted, the evaded tax shall be payable together with penalty equal to the tax so evaded along with interest for the difference in tax paid and payable calculated at nine percent per annum.

Illustration: If payable tax is rupees 150 for the year 2021 but actual property tax paid is rupees 100 then evaded tax amount is rupees 50. If the payment is happening on 23rd December 2023, then the following shall be payable -

(i)       Evaded Property Tax Amount = Rs 50/-

(ii)      Penalty for evasion = Rs 50/-

(iii)     9% interest on the evaded property tax of Rs 50/- shall be calculated as follows -

(a)      9% interest on Rs 25/- which is 50% of Rs 50/-, from 31st May 2021 until date of payment; and

(b)      9% interest on the rest Rs 25/- which is 50% of Rs 50/-, from 30th November 2021 until date of payment.

This provision shall also apply with respect to the unpaid demand where demands are already issued but for which the concerned person has not paid the demanded dues:

Provided that the payments already made as per previous provision shall not be refunded nor adjusted against future liabilities.

Provided further that the penalty payable by residential properties which have tiled or sheet roof (non-RCC) and is not more than 1000 Sq Ft, have only the ground floor and is self-occupied, shall be 25% of the evaded tax.

Provided also that no penalty shall be payable by residential properties which are hutments, Government housing for poor, houses declared as slum by the Karnataka Slum Development Board or by Bruhat Bengaluru Mahanagara Palike, where such houses are self-occupied and have an area less than 300 square feet.

Provided also that in case of properties which are in the Property tax registers but fail to pay the property tax, by end of the financial year in which the tax becomes due, shall, for the twelve months after the end of the financial year in which the tax became due, pay an interest at a rate of 15% per annum on the unpaid tax, calculated until the date when the tax is paid.

Provided also that after end of said twelve months that is from second year after the end of the financial year in which the tax became due, any tax still unpaid shall pay a penalty equal to the unpaid tax plus the unpaid tax with interest on the unpaid tax at a rate of 9% per annum.

Provided also that in case of existing defaulters the said twelve month period shall be deemed to start from 1.4.2024 and any tax out of the said dues still unpaid as on 1.4.2025, shall pay a penalty equal to the unpaid tax plus the unpaid tax with interest on the unpaid tax at a rate of nine percent per annum thereafter.

Provided also that as a one-time measure, in order to bring all the tax defaulters, un-assessed properties and those liable for reassessment up-to-date with respect to their tax payments, the interest otherwise liable to be paid under this section for unpaid or reassessed tax, shall be exempted for the payments made until 31st July 2024.

Provided that this provision shall be applicable prospectively.

(viii)  for sub-section (16), the following shall be substituted namely:-

"(16) The assessment of un-assessed properties or the reassessment of the properties already paying the property tax under this section may be made at any time when evasion is noticed or justified circumstances arise for the same:

Provided that in case of residential properties and the properties with a single ID in the Property Tax registers of the Bruhat Bengaluru Mahanagar Palike which have mixed use as residential and non-residential, the arrears of the property tax for the under-assessed or un-assessed properties, the applicable penalties and the interest payable, shall be limited to five years even if the un-assessment or the under-assessment of property tax exceeds five years"

(ix)    in sub-section (18), words "unit area value" shall be omitted.

Section - 7. Amendment of section 148 :-

In the Principal Act, section 148 shall be omitted.

Section - 8. Amendment of section 149 :-

In the Principal Act, in section 149,-

(i)       in sub-section (1), the following proviso shall be inserted at the end, namely:-

"Provided that, in case of transactions registered under the Registration Act, 1908 (Central Act 16 of 1908) where such information is received from the concerned Sub Registrar, it shall not be mandatory to notify such a transfer by the person primarily liable for payment of property tax."

(ii)      for sub-section (3), the following shall be substituted, namely:-

"(3) Whenever such transfer comes to the knowledge of the Chief Commissioner or authorised officer through such notice or otherwise, the name of the transferee shall be entered in the property tax register.

(iii)     sub-section (5) and entries relating thereto shall be omitted.

(iv)    in sub-section (6), for the words, "without consulting the Board or local authority concerned", the words "without confirmation of order of transfer of such a building or land by the said Board or local authority concerned" shall be substituted.

Section - 9. Amendment of section 150 :-

In the Principal Act, in section 150,-

(i)       for the words "three years", the words "five years" shall be substituted.

(ii)      the following proviso shall be inserted at the end, namely:-

"Provided that no such limitation shall apply in case such a wrongful or incorrect entry is made with respect to a Government land or a land belonging to any local body, any statutory body or an organization owned or controlled by the Government."

Section - 10. Amendment of section 156 :-

In the Principal Act, in section 156,-

(i)       in sub-section (1), for the word and figures "section 148", the numbers and word "section 144" shall be substituted.

(ii)      in sub-section (3), the following provisos shall be inserted at the end, namely:-

"Provided that any person seeking to file an appeal shall deposit fifty percent of the demanded amount with the Corporation.

Provided further that in case of appeal being successful resulting in refund either in part or in full of the already deposited amount, the same shall be immediately refunded by the Corporation or adjusted against any other pending or future property taxes or penalties or cesses or interest or other levies."

(iii)     the following shall be inserted after sub-section (3) and the provisos so inserted above, namely:-

"(4) If the person to whom a notice of demand has been served under subsection (1) does not pay the tax within thirty days from the service of such demand, in the absence of any stay issued by the Appellate Authority on the demand notice, the Chief Commissioner may recover by distraint under his warrant and sale of such movable property of the defaulter or if the defaulter is the occupier of the building by distress and sale of any movable property which may be found in or on such building or land, the amount due on account of tax together with the warrant fee and distraint fee and with such further sums as will satisfy the probable charges, that may be incurred in connection with the detention and of the sale of property so distrained.

(5)   If, for any reason the distraint, or a sufficient distraint of the defaulters property cannot be effected, the Chief Commissioner may attach the bank account or the immovable property of the defaulter in such manner as may be prescribed, till the recovery of the property tax due:

Provided that in case of non-payment of the demanded dues even after sixty days from the date of attachment of the immovable properties, the same may be recovered by the distress sale of the immovable properties so attached. In doing so the demand dues together with the warrant fee and with such further sums as will satisfy the probable charges that may be incurred in connection with distress sale of the immovable property so attached.

Provided further that the Chief Commissioner may prosecute the defaulter before a competent court."

Section - 11. Amendment of section 157 :-

In the Principal Act, in section 157,-

(i)       for the second proviso, the following shall be substituted, namely:-

"Provided further that no fee shall be levied under this section on any advertisement or a notice,-

(a)      of a public meeting, or corporation of the city, or

(b)      of an election to any legislative body, or

(c)      of a candidature in respect of such an election: in case the said advertisement or notice is within the maximum permissible size prescribed therefor. In case the advertisement or the notice exceeds the prescribed size, then such advertisement or notice shall be liable for payment of prescribed advertisement fee."

(ii)      in the third proviso, for clause (e), the following shall be substituted namely:-

"(e) is exhibited with in any train;"

(iii)     after Explanation-3, the following proviso shall be inserted, namely:-

"Provided that in case of advertisement that is liable to pay advertisement fee and/or penalty, whether authorized or unauthorized, but delays to pay the fee, he shall be liable to pay, in addition to the fee, and/or penalty, an interest thereon at a rate of eighteen percent per annum calculated from the date of advertisement fee or penalty becoming due until the date of payment thereof.

Provided further that any unauthorized advertisement shall be liable to pay a penalty as may be specified in the bye-laws."

Section - 12. Amendment of section 161 :-

In the Principal Act, in section 161, the following shall be inserted at the end, namely:-

"Any dues as per prescribed advertisement fees may be assessed, demand and show cause notices thereon issued and recoveries made, mutatis mutandis, as per manner provided for issuance of show cause notice, demand notice and the recovery of demand for the property tax under this Act:

Provided that for unauthorized advertisements the cost of removal thereof, in addition to other provisions, the same may be recovered by the seizure and sale of the unauthorized advertisement materials."

Section - 13. Amendment of section 162 :-

In the Principal Act, for section 162, the following shall be substituted, namely:-

"162. Collection of fees on advertisement.- The collection of any fee on advertisement leviable under section 158 for any period may be assigned to a suitable agency for a period not exceeding one year at a time on such terms and conditions as may be specified for in the bye-laws and in due compliance of the provisions of the Karnataka Transparency of Public Procurement Act, 1999 (Karnataka Act 29 of 2000) and the rules made thereunder."

Section - 14. Amendment of section 171 :-

In the Principal Act, for section 171, the following shall be substituted, namely:-

"171. Appeal.- Any person aggrieved by the order of re-assessment by the Chief Commissioner may appeal to an authority and the procedure including the time limit shall be so prescribed:

Provided that the appeal shall not be admitted unless the appellant deposits at least fifty percent of the re-assessed or assessed fee to the Corporation.

Provided further that in case of appeal being successful resulting in refund either in part or in full of the already deposited amount, the same shall be immediately refunded by the Corporation or adjusted against any other pending or future fees or taxes or penalties or cesses or interest or other levies."

Section - 15. Amendment of section 172 :-

In the Principal Act, in section 172, for sub-sections (2) and (3), the following shall be substituted, namely:-

"(2) Any person against whom a demand for payment of tax has been issued, may challenge such demand before the prescribed authority in accordance with such rules as may be prescribed.

(3)  If the person fails to pay tax within the time period provided for under sub-section (1) and sub-section (2), the prescribed authority may order the recovery of the tax by the Corporation as an arrears of land revenue in a manner and procedure prescribed for recovery of property tax including distraint of moveable properties, attachment of bank accounts and immovable properties and distress sale of the immovable properties under this Act."

Section - 16. Amendment of section 178 :-

In the Principal Act, in section 178, the words "within six years from the date on which such person should have been assessed" shall be omitted.

Section - 17. Amendment of section 179 :-

In the Principal Act, the section 179 shall be omitted.

Section - 18. Insertion of new section 249A :-

In the Principal Act, after section 249, the following shall be inserted, namely:-

"249A. Exercise of powers by a corporation to be in conformity with the provisions of the Karnataka Town and Country Planning Act, 1961.-

Notwithstanding anything contained in this Act, a corporation or any officer or other authority required by or under this Act to exercise any power, or perform any function or discharge any duty,-

(i)       with regard to any matter relating to land use or development as defined in the Explanation to section 14 of the Karnataka Town and Country Planning Act, 1961, shall exercise such power, or perform such function or discharge such duty with regard to such land use or development plan or where there is no development plan, with the concurrence of the Planning Authority;

(ii)      shall not grant any permission, approval or sanction required by or under this Act to any person if it relates to any matter in respect of which compliance with the provisions of the Karnataka Town and Country Planning Act, 1961 is necessary unless evidence in support of having complied with the provisions of the said Act is produced by such person to the satisfaction of the corporation or the officer or other authority, as the case may be."