The Kerala High Court has ruled that the Kerala Conservation of Paddy Land and Wetland Act, 2008, does not authorize the State to levy a fee based on the plinth area or extent of buildings constructed on converted paddy land. This decision came in response to a batch of petitions, including Abad Builders Private Limited v. State of Kerala & Ors, challenging such levies.
Justice Mohammed Nias CP declared Note 1 to Rule 12(9) of the Kerala Conservation of Paddy Land and Wetland Rules, 2008, as ultra vires to the Paddy Land and Wetland Act to the extent it allowed the imposition of a fee of ₹100 per square foot for construction exceeding 3,000 sq. ft.
“Even if the government’s objectives are commendable, a fee cannot be collected without an enabling statutory provision. The argument that the levy is ultra vires is upheld as the Act’s intent and rule-making authority under Section 30 do not permit such fees,” the Court held.
The Court noted that activities like construction are permissible after land conversion, and the Paddy Act ceases to apply to the converted land. The only fee envisioned under Section 27A(3) pertains to regularizing the land records and is based solely on the land’s extent, not the construction’s size or area.
The government argued that Section 27A(3) of the Act did not prevent fees based on plinth area and claimed the levy aligned with legislative intent to regulate land conversion responsibly while safeguarding ecological standards and agricultural interests. However, the Court found this argument unpersuasive.
The Court also rejected the State’s contention that the fee aimed to discourage large-scale developments and fund a “Paddy Cultivators Relief Fund.” It ruled that the levy violated Article 265 of the Constitution of India, which prohibits the collection of taxes without statutory authority.
“I hold that the levy is opposed to Article 265 of the Constitution of India as no statutory provision enables the Government to collect a levy like the one impugned in the writ petition,” Justice Nias observed.
As a result, the Court declared the levy invalid and directed the authorities to:
- Refund amounts collected from the petitioners within four months.
- Process pending building permit applications without insisting on the contested fee and in compliance with the Building Rules.
The Court further ordered that pending applications for building permits be processed within six weeks.
Senior Advocate BG Harindranath and advocates Amith Krishnan, PK Soyuz, KC Vincent, Jacob Sebastian, P Sathisan, and Shanavas Khan represented the petitioners. Special Government Pleader S Renjith appeared for the State.
