THE KARNATAKA MUNICIPAL CORPORATIONS (AMENDMENT) ACT, 2009
KARNATAKA ACT NO. 2 OF 2009
(First Published in the Karnataka Gazette Extra-ordinary on the Fifth day of March, 2009)
(Received the assent of the Governor on the twenty-seventh day of February, 2009)
An Act further to amend the Karnataka Municipal Corporations Act, 1976.
Whereas it is expedient further to amend the Karnataka Municipal Corporations Act, 1976 (Karnataka Act 14 of 1977) for the purposes hereinafter appearing;
Be it enacted by the Karnataka State Legislature in the fifty-ninth year of the Republic of India, as follows:-
1. Short title and commencement.- This Act, may be called the Karnataka Municipal Corporations (Amendment) Act, 2009.
(2) It shall be deemed to have come into force with effect from thirteenth day of January, 2009.
2. Amendment of section 3.- In section 3 of the Karnataka Municipal Corporations Act, 1976 (Karnataka Act 14 of 1977) (hereinafter referred to as the principal Act), after sub-section (2) the following shall be inserted namely:-
Provided that the “Corporation of City of Bangalore” shall be called the “Bruhat Bangalore Mahanagara Palike”.
3. Insertion of new section 108A.- After section 108 of the principal Act, the following new section shall be inserted, namely:-
“108A. Levy and calculation of property tax in respect of Bruhath Bangalore Mahanagara Palike.- (1) Notwithstanding anything contrary contained in this Act, subject to such exemptions provided under this Act and such rules as may be prescribed, the property tax of all buildings or vacant lands or both situated within the city of Bruhath Bangalore Mahanagara Palike area shall be levied every year in the following manner.
(2) The property tax shall be levied by the Bruhath Bangalore Mahanagara Palike by resolution passed as specified in section 106 at such percentage not being less than 20 percent and not more than 25 percent of the taxable annual value of a building, vacant land or both. The taxable annual 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 depreciation at such rate, as may be prescribed, depending on the age of a building.
Explanation.- For the purpose of this section, “Unit Area Value” means an average rate of expected returns from the property per sq.ft., per month determined by the Commissioner, Bruhath Bangalore Mahanagara Palike on the basis of the average market rate determined through mass appraisal method or real estate market information or any other reliable source or combination of these sources that he may considers it as sufficient and reasonable having regard to the location, type of construction of the building, nature of use to which the vacant land or building is put, area of the vacant land, built-up area of the building, age of the building, parking area of vehicles in non- residential building where it is charged and such other criteria as may be prescribed. Different rates may be determined for different area or street by classifying into zones, different nature of use to which the vacant land or building is put and for different class of buildings and vacant lands:
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 the land appurtenant to a building to the extent not exceeding thrice the area occupied by such building shall be exempted from the property tax:
Provided also that subject to such condition and in such circumstances as may be notified, the Commissioner, Bruhath Bangalore 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 Commissioner, Bruhath Bangalore Mahanagara Palike; and
(b) an area used as parking area in a non-residential building and being charged for its use by the owner or the occupier.
(c) any other class of building or structure as he deems fit.
(3) The Bruhath Bangalore Mahanagara Palike may levy and collect the property tax from every building, vacant land or both including a building constructed in violation of the provisions of building byelaw or in an unauthorized layout or in a revenue land or from a building occupied without issuance of occupancy or completion certificate except the building constructed illegally in Government land, land belonging to any local body, any statutory body or an organization owned or controlled by the Government. The property tax collected from such building shall be maintained in a separate register:
Provided that levy and collection of property tax under this sub-section from such building does not confer any right to regularise violation made, or title, ownership or legal status to such building. Such buildings shall always be liable for any action for violation of law in accordance with the provisions of this Act or any other law.
(4) The property tax payable shall be reduced by fifty percent in respect of a self occupied building used for residential purpose and such class of self occupied non-residential building as may be notified by the State Government on the recommendation of the Corporation.
(5) The provisions contained in sections 107, 110, 111, 112, sub-sections (5), (6) and (7) of section 112A, and sections 112B, 112D and 113 to the extent they are not inconsistent to the provisions of this section shall mutatis mutandis apply to the Bruhath Bangalore Mahanagara Palike:
Provided that the State Government may prescribe separate procedure, form or register in respect of property assessed by the Bruhath Bangalore Mahanagara Palike. A different register may be prescribed for different class of property assessed for tax.
(6) The person primarily liable to pay the property tax, shall pay the tax in two equal instalments. The first being before 30th May and second by 29th November of each financial year. However, the owner or occupier or person primarily liable to pay property tax may choose to pay in one instalment:
Provided that for the year 2008-09, the first instalment shall be paid within sixty days from the date of commencement of the Karnataka Municipal Corporations (Amendment) Act, 2009 and the second instalment shall be paid within thirty days thereafter:
Provided further that if the owner or occupier who is liable to pay property tax files return and also pays property tax for the whole year, within one month from the date of commencement of each year or within one month or within one month from the date of commencement of the Karnataka Municipal Corporations (Amendment) Act, 2009 for the year 2008-09, he shall be allowed a rebate of five per cent on the tax payable by him:
Provided also that the State Government may on the recommendation of the Corporation by notification extend the time limit for payment of property tax without penalty and for the benefit of 5% rebate in respect of the financial year 2008-09 and 2009-2010.
Provided also that subject to random scrutiny as may be prescribed, the tax return filed for the first time during 2008-09 shall form the base for payment of tax applicable during each block year.
(7) Before any owner or occupier submits any return under sub-section (8), he shall pay in advance half-yearly tax calculated or the full amount of the property tax payable by him for the year on the basis of such return declared by him as being true and complete.
(8) Notwithstanding anything contained in sub-section (1) of section 112A, the State Government may prescribe the form and the manner in which every owner or occupier who is liable to pay the property tax under this Act shall submit a return every year to the Commissioner, Bruhath Bangalore Mahanagara Palike or to the officer or agency authorized by him in this behalf.
(9) In order to facilitate filing of return by an owner or occupier of any building or vacant land or both and assessment of property tax under this section, the Commissioner shall from time to time issue guidelines for determining the unit area value and property tax payable thereon.
(10) Every return filed by a owner or occupier shall be deemed to have been assessed to tax except in cases where the Commissioner or authorised officer may take-up or authorise subordinate officers the cases for random scrutiny of the returns filed in the manner prescribed.
Provided that Commissioner may suo moto or otherwise has reason to believe that there is an evasion of tax by the owner or occupier, he may cause inspection of such building and assess the tax.
(11) For the purpose of random scrutiny of the return filed or in cases where returns are not filed as required under sub-section (8) in respect of any buildings or lands or both, the Commissioner or any person authorized by him in this behalf may enter, inspect, survey or measure any land or building after giving notice to the owner or occupier and the owner or occupier shall be bound to furnish necessary information required and based on such inspection and information collected, he shall assess the property tax subject to sub-section (5) and send a copy of the order of assessment to the owner or occupier concerned. Such entry into and upon any building or vacant land shall be made between sunrise and sunset.
(12) If the occupier of the property, refuses to allow the authorised officer to enter to inspect the premises, the officer after giving reasonable opportunity shall record the refusal and shall proceed to assess the property to the best of his judgement:
Provided that in the case of buildings used as human dwelling due regard shall be paid to the social and religious customs of the occupiers and no apartment in the actual occupancy of a woman shall be entered until she has been informed that she is at liberty to withdraw and every reasonable facility has been afforded to her for withdrawing.
(13) Upon random scrutiny, if the authorized officer has reasons to believe that any return furnished, which is deemed as assessed, is incorrect or has been underassessed resulting in evasion of property tax,-
(a) may, on the basis of information available on record and after physical inspection proceed to re-assess the property, in the manner provided under this section;
(b) if the tax-reassessed is more than 5 percent than the tax remitted alongwith the returns, the evaded tax shall be payable together with a penalty not less than twice the tax so evaded payable alongwith interest for the difference in tax paid and payable calculated at 24 percent per annum;
(c) if upon inspection and re-assessment as made under this section by the Commissioner or the authorized officer, shall issue a notice of re-assessment to the tax payer demanding that the tax shall be paid within thirty days of the service of the notice and after giving the tax payer the opportunity of show cause in writing;
(d) the owner or occupier may either accept the property tax assessed and the penalty levied or send objections to the Commissioner or the authorized officer within a period of thirty days from the date of receipt of a copy of the notice under this sub-section;
(e) the Commissioner or the authorized officer shall consider the objections and pass such orders either confirming or revising such assessment within a period of sixty days from the date of filing objections and a copy of the order shall be sent to the owner or occupier concerned.
(14) An assessment or re-assessment under this section shall not be made after the following time limits,-
(i) three years after filing the tax return under this section;
(ii) three years after the evidence of facts, sufficient in the opinion of the Commissioner or the authorized officer to justify making of the re-assessment, comes to its knowledge, whichever is later.
(15) In computing the period of limitation specified for assessment or re-assessment, as the case may be under this Act, the period taken for disposal of any appeal against an assessment or other proceedings by the appellate authority, a tribunal or competent court shall not be taken into account for assessment or re-assessment as the case may be.
(16) Subject to sub-section (2), the property tax assessed and levied under this section shall be liable for revision once in three years by enhancing 15 percent commencing from the financial year 2008-09:
Provided that the Municipal Corporation may enhance such property tax upto 30 percent once in three years and different rates of enhancement may be made to different areas and different classes of buildings and lands:
Provided further that the non-assessment of property tax under this section during the block period of three years shall not be applicable to a building in respect of which there is any addition, change of use, alteration or variation to it. The owner or occupier shall report such changes within six months from the date of completion or occupation whichever is earlier alongwith the revised return and tax:
Provided also that nothing contained in this section shall be deemed to affect the power of State Government to direct an earlier revision of property tax.
(17) The Commissioner shall have power to clarify any doubt as to classification of zones, unit area value and class of property. The decision of the Commissioner in this regard shall be final.”
3. Repeal and savings.- (1) The Karnataka Municipal Corporations (Amendment) Ordinance, 2008 ( Karnataka Ordinance No.1 of 2008 ) is hereby repealed.
(2) Notwithstanding such repeal anything done or any action taken under the principal Act as amended by the said ordinance, shall be deemed to have been done or taken under the principal Act as amended by this Act.
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