Karnataka HC upholds statewide directions to inventory and GIS-map municipal trust properties

The Town Municipal Council auctioned 1 acre and 7 guntas in Survey No. 123/2 in 1977 to the first respondent’s father.

The auction was approved by the Council in 1988 and by the Zilla Parishad in 1991; a registered sale deed followed in 1991.

The father conveyed the property to the first respondent by registered deed in 2013, and the Council sanctioned a building plan and issued a licence that year.

Following a complaint alleging that the auction lacked prior Government approval, the Council cancelled the building-plan sanction and licence on 27 November 2013, without a hearing.

The Single Judge allowed the first respondent’s writ petition and, among other relief, set aside the Deputy Commissioner’s 2017 order cancelling the khata.

The Council appealed, seeking to overturn the Single Judge’s decision insofar as it quashed the relevant orders.

1. Whether the Single Judge’s decision setting aside the impugned municipal and Deputy Commissioner orders warranted appellate interference.

2. Whether the Council could cancel the building-plan sanction and licence without first giving the first respondent an opportunity to be heard, while the registered sale deed remained uncancelled.

3. Whether dismissal of the appeal would prevent the Council from pursuing lawful proceedings concerning alleged fraud or illegality in the auction or sale deed.

The Court applied the principle of procedural fairness that an affected party must be given an adequate opportunity of being heard before an adverse administrative action is taken.

It also proceeded on the basis that, while the registered sale deed remained uncancelled and no cancellation proceedings had been initiated, the Council could not treat the alleged illegality in the auction as established merely by cancelling the building approval; any challenge to the auction or deed required appropriate proceedings in accordance with law.

The Single Judge’s directions referred to Sections 81 and 72 of the Karnataka Municipalities Act, 1964, concerning municipal properties and their alienation, but the appellate judgment did not independently determine those provisions’ application to the transaction.

The Court noted that the first respondent held property under a registered sale deed that had not been cancelled, and that the Council had not initiated proceedings to cancel it.

Against that background, the Council’s cancellation of the building-plan sanction and licence on the day after the complaint, without hearing the first respondent, reflected a failure to follow due process.

The Court therefore found no basis to interfere with the Single Judge’s decision, while preserving the Council’s ability to pursue any properly instituted proceedings concerning alleged fraud or illegality.

The dismissal does not bar the Council from initiating appropriate proceedings if it considers that fraud or illegality affected the auction or sale deed; any such action must comply with law and afford the affected parties an adequate opportunity to be heard.