Allahabad HC Affirms exemption of process fees for approval of maps for Charitable Society

Shiv Mandir Gauri Shanker Vishvanath Vaikunth Dham Evam Shamshan Bhumi Pravandhak Sabha Vs State of U.P. and 2 Others (Allahabad High Court)

In the case of Shiv Mandir Gauri Shanker Vishvanath Vaikunth Dham Evam Shamshan Bhumi Pravandhak Sabha vs. State of U.P. and 2 Others, the Allahabad High Court dealt with a writ petition filed by the petitioner society under Article 226 of the Constitution of India. The society sought several reliefs, primarily challenging a demand notice dated 05.08.2022 and a subsequent order dated 17.08.2023 passed by the Saharanpur Development Authority (SDA). These demands pertained to process fees for the approval of maps under the Uttar Pradesh Nagar Yojana Aur Vikas (Vikas Shulk Ka Nirdharan, Udgrahan Evam Sanghran) Niyamavali, 2014 (“Niyamavali, 2014”).

Background and Arguments:

1. Petitioner’s Claim: The petitioner, a Charitable Society registered under the Societies Registration Act, 1860, maintained that it ran and maintained various facilities including a temple, cremation site, Dharamshala, and a charitable hospital. It claimed exemption from development charges under Section 53 of the Uttar Pradesh Urban Planning and Development Act, 1973, as per the provisions of Niyamavali, 2014. Additionally, the society had obtained exemptions under Sections 12A and 80G of the Income Tax Act, 1961, effective from 01.04.2014.
2. Legal Basis for Exemption: The society argued that it was entitled to exemption from development charges and process fees under the Niyamavali, 2014, which exempted buildings used for charitable, spiritual, or religious purposes from such charges.
3. Actions by Saharanpur Development Authority (SDA): The SDA had approved the petitioner’s map for construction of the temple and cremation site on 17.11.2014. However, despite this approval and the society’s claims for exemption, the SDA issued demand notices for substantial amounts, leading to the petitioner depositing Rs. 26,45,000 under protest.
4. Contentions of the Respondents: The SDA, represented by its counsel, opposed the writ petition. They contended that the exemptions claimed were not valid at the time of map sanction since the approvals under Sections 12A and 80G of the Income Tax Act were pending consideration.

Court’s Findings:

1. Exemption Validity: The High Court observed that the petitioner had indeed obtained exemptions under Sections 12A and 80G of the Income Tax Act, 1961, with effect from 01.04.2014. Therefore, at the time of the map sanction on 17.11.2014, the petitioner was eligible for exemptions under the Niyamavali, 2014.
2. Government Orders: The court referred to the relevant Government orders, including those from 1998 and 2002, which supported exemptions for charitable and religious institutions from development charges under specific conditions. The subsequent Niyamavali, 2014 and Circular dated 18.07.2016 reiterated these exemptions.
3. Legal Standing: Upholding the petitioner’s arguments, the court found that the SDA’s demand notices and subsequent orders were unsustainable. It noted that the petitioner had already deposited a significant amount under protest and had complied with all statutory requirements for obtaining exemptions.
4. Relief Granted: Consequently, the High Court allowed the writ petition and set aside the impugned orders. It directed the matter to be reconsidered by the Vice Chairman of the SDA within six weeks, with a clear directive to consider the exemptions under Niyamavali, 2014, and the Income Tax Act, 1961.

Conclusion: