SC rejects RIL plea against levy of development charges

Written by Indu Bhan | Indu Bhan | New Delhi | Updated: Apr 16 2013, 08:21am hrs
The Supreme Court on Monday dismissed Reliance Industries' (RIL) appeal against the levy of development charges by the Gujarat government on all development activities in its industrial area complex in Hazira, near Surat.

With this order, RIL will have to deposit over R8.15 crore along with costs imposed by the Gujarat High Court on the development activities, which were declared illegal by the HC in December last year.

RIL had challenged the High Court's judgment that upheld the imposition of development charges by the state government on all development in the Hazira area.

A bench headed by Justice Aftab Alam while dismissing the petition said that all the construction done in the petrochemical complex will not be held illegal. Besides, he kept the question of law open.

Senior counsel Harish Salve, appearing for RIL, argued that the state government has sought to levy development charges in an arbitrary manner by levying the maximum rate of development charges without stating the cause or enumerating the reasons and the grounds for such levy, which is a mandatory requirement under Rule 50 of the Gujarat Town Planning and Urban Development Act, 1979.

Pursuant to HADA (the designated authority) expressing its inability to grant permission in the absence of the draft development plan in June 1989, Reliance had obtained permission of the appropriate gram panchayat to complete development and construction in the area.

While the development plan was finally sanctioned in 1994, according to the Ambani firm, the state government in 1989 published a Notification under Section 99 of the 1979 Act proposing levy and imposition of development charges.

RIL said that instead of imposing flat rate on lands a substantial charge has been imposed.

It added that the HC overlooked the manner in which development charges are being demanded for a period prior to even the development being in place.