WP/7484/2021 of M/s.Camp Tech LLP Vs The State of Tamil Nadu on 3 November 2026

ORDER

The present writ petition has been filed challenging G.O.Ms.No.170, Housing and Urban Development (UDI) Department, dated 11.12.2018, insofar as it relates to the deletion of Regulation 35(3) of the Development Regulations for the Chennai Metropolitan Area. The petitioner also challenges the consequential demand dated 20.09.2019, particularly Item No.8, requiring payment of premium Floor Space Index (FSI) charges in respect of the property situated at Plot Nos.25A and 25B, SIDCO Thiru-Vi-Ka Industrial Estate, South Phase, 5th Cross Street, Guindy, Chennai. The petitioner seeks a consequential direction to the second respondent to refund the sum of Rs.1,08,50,000/- paid towards premium FSI charges under protest, together with interest.

2. The petitioner submitted an application seeking planning permission for the construction of an IT Park comprising a basement, part stilt floor, part ground floor and 11 upper floors on the aforesaid property. By communication dated 20.09.2019, the third respondent called upon the petitioner to pay various charges, including open space reservation charges and premium FSI charges, as a condition for the grant of planning permission. The petitioner objected to the demand and submitted a representation challenging the levy. Nevertheless, the petitioner remitted the demanded amounts under protest and without prejudice to its rights. The present writ petition has been filed insofar as the demand relates to premium FSI charges.

3. Mr. Satish Parasaran, learned Senior Advocate representing the learned counsel for the petitioner, submitted that the demand for premium FSI charges arises from G.O.Ms.No.170 dated 11.12.2018, by which the

Government sought to amend Regulation 35(3) of the Development Regulations and discontinue the benefit available to IT developments. According to the learned Senior Advocate, the amendment was made without following the mandatory procedure contemplated under Sections 123 and 124 of the Tamil Nadu Town and Country Planning Act, 1971, and is therefore unsustainable in law.

4. The learned Senior Advocate further submitted that Regulation 24(4)

(b) , read with Annexure XIII of the Development Regulations, provides special concessions for the development of IT Parks in specified use zones, including the industrial use zone. According to him, the petitioner is entitled to the benefit of the said provisions and, consequently, to an FSI of 3.375. It was therefore contended that the demand for premium FSI charges is contrary to the applicable Development Regulations.

5. Per contra, Mr. P.V. Balasubramanian, learned Additional Advocate General appearing for the respondents, submitted that G.O.Ms.No.170 dated 11.12.2018 discontinued the premium FSI benefit by amending Regulation 35(3). Since the petitioner’s application for planning permission was submitted when the said Government Order was in force, the petitioner is bound by its provisions.

6. The learned Additional Advocate General further submitted that Regulation 24(4)(b), read with Annexure XIII, applies only to properties situated within the IT Corridor along Rajiv Gandhi Salai, formerly known as Old Mahabalipuram Road. Since the petitioner’s property is situated in an industrial estate and not within the IT Corridor, the petitioner cannot claim the concession provided under the said provisions. He therefore contended that the demand for premium FSI charges is valid and that the writ petition is liable to be dismissed.

7. Heard the learned Senior Advocate appearing for the petitioner, the learned Additional Advocate General and the learned State Counsel appearing for the respondents. The materials placed on record have also been perused.

8. The following questions arise for consideration:

(i) Whether the benefit available under Regulation 24(4)(b), read with Annexure XIII of the Development Regulations, is confined to properties situated within the IT Corridor along Rajiv Gandhi Salai, or whether it extends to eligible IT Park developments in other specified use zones, including the industrial use zone.

(ii) Whether the amendment introduced by G.O.Ms.No.170 dated 11.12.2018, insofar as it affects the petitioner’s claim to the benefit under Regulation 35(3), is legally sustainable.

(iii) Whether the demand for premium FSI charges dated 20.09.2019 and the consequential retention of the amount paid by the petitioner can be sustained.

9. Before considering the rival submissions, it is necessary to examine the relevant provisions of the Development Regulations.

10. Regulation 24 deals with areas and developments of a special character. Regulation 24(4)(b) refers to the IT Corridor, which covers the area extending to a depth of 500 metres on either side of Rajiv Gandhi Salai, from Kottivakkam and Perungudi villages up to the Chennai Metropolitan Area limits. The provision permits IT developments in that corridor, irrespective of the zoning classification under the Master Plan or Detailed Development Plan, subject to the conditions specified in Annexure XIII.

11. The respondents rely upon the reference to the IT Corridor in Regulation 24(4)(b) to contend that the concessions under Annexure XIII are available only to properties situated within that corridor. The petitioner, on the other hand, contends that Annexure XIII expressly refers to several other use zones and cannot be restricted to the IT Corridor alone.

12. On examining the relevant provisions, this Court finds that the scope of Annexure XIII cannot be determined by reading Regulation 24(4)(b) in isolation. The provisions must be read harmoniously, having regard to their language and purpose.

13. Annexure XIII, which prescribes the rules for IT Park development, refers to development in various use zones, including primary residential, commercial, industrial, mixed residential, institutional and urbanisable use zones, besides IT Corridor lands along Old Mahabalipuram Road. The inclusion of the industrial use zone, among other specified zones, is important .

14. If the intention were to restrict the concessions under Annexure XIII exclusively to properties situated within the IT Corridor, there would be no apparent purpose in separately referring to the other use zones, including the industrial use zone. Such an interpretation would render those references ineffective. A provision must, as far as possible, be interpreted in a manner that gives effect to all its parts.

15. Regulation 24(4)(b) specifically addresses the permissibility of IT developments within the IT Corridor, notwithstanding the zoning classification under the relevant planning documents. Annexure XIII, however, sets out the conditions and concessions applicable to qualifying IT Park developments in the use zones specified therein. The reference to the IT Corridor in Regulation 24(4)(b) cannot, by itself, be construed as excluding every other use zone expressly mentioned in Annexure XIII.

16. Admittedly, the petitioner’s property is situated in an industrial estate and not alongside Rajiv Gandhi Salai. However, that circumstance alone does not dis-entitle the petitioner from claiming the benefit of Annexure XIII. The relevant question is whether the proposed development falls within the categories of IT Park development contemplated by the applicable provisions and satisfies the prescribed conditions.

17. The respondents’ contention that the concessions are available only to developments situated within the IT Corridor is therefore not acceptable. An eligible IT Park development in an industrial use zone cannot be excluded merely because the property does not fall within the geographical limits of the IT Corridor, when Annexure XIII expressly recognises the industrial use zone.

18. It follows that the petitioner’s claim must be examined under the provisions governing IT Park developments, including Regulation 35(3), as applicable to the petitioner, and not rejected solely on the ground that the property is situated in an industrial estate outside the IT Corridor.

19. The next question concerns the validity of G.O.Ms.No.170 dated 11.12.2018, insofar as it seeks to delete or discontinue the benefit available under Regulation 35(3).

20. The Government’s power to amend Development Regulations must be exercised in accordance with the governing statute. Where the statute prescribes a procedure for making or amending regulations, compliance with such procedure is essential to the validity of the amendment. The issuance of a Government Order, by itself, does not validate an amendment made without following the prescribed statutory procedure.

21. The petitioner specifically contends that the impugned amendment was introduced without following the procedure contemplated under Sections 123 and 124 of the Tamil Nadu Town and Country Planning Act, 1971.

22. Section 123(1) of the Tamil Nadu Town and Country Planning Act, 1971, mandates publication of rules made under the Act in the Tamil Nadu Government Gazette. Section 123(2) further requires every such rule to be placed before the Legislative Assembly. Section 124(1) empowers a planning authority, with the previous approval of the Government, to make regulations consistent with the Act and the rules made there under. These provisions prescribe the statutory framework governing the exercise of the power to make rules and regulations under the Act.

23. In the present case, the petitioner contends that the amendment to Regulation 35(3), which discontinues the benefit available to qualifying IT Park developments, was neither published in the Tamil Nadu Government Gazette nor placed before the Legislative Assembly. If the impugned amendment is in the nature of a rule to which Section 123 applies, the failure to comply with the mandatory requirements of publication and laying before the Legislative Assembly would have to be considered in determining its validity. Equally, if the amendment was made by exercising the power under Section 124, its validity must be examined with reference to the requirements governing the making and amendment of regulations under that provision.

24. The State is unable to dispute that the impugned amendment was neither published in the Official Gazette nor placed before the Legislative Assembly. In view of the non-compliance with the statutory procedure contemplated under Sections 123 and 124 of the Tamil Nadu Town and Country Planning Act, 1971, the impugned amendment is held to be inoperative.

25. The remaining question is whether the petitioner is entitled to a refund of the premium FSI charges paid under protest.

26. The demand dated 20.09.2019 was made on the basis of the regulatory position relied upon by the respondents. However, for the reasons stated above, the respondents cannot deny the petitioner the benefit of the applicable provisions merely because the property is situated in an industrial estate outside the IT Corridor. Further, to the extent that the demand rests upon the impugned amendment to Regulation 35(3), which is unsustainable for non- compliance with the mandatory statutory procedure, the demand cannot be allowed to stand.

27. The petitioner has paid a sum of Rs.1,08,50,000/- towards premium FSI charges under protest and without prejudice to its rights. The payment was made pursuant to the demand issued as a condition for the grant of planning permission. Once the legal basis for the levy is found to be unsustainable, the respondents cannot retain the amount merely because it was paid to secure the processing of the planning application.

28. Consequently, the petitioner is entitled to a refund of Rs.1,08,50,000/- towards premium FSI charges, subject to verification that the entire amount claimed represents the levy impugned in the present writ petition and that no part of it has already been refunded or adjusted. This direction shall not extend to any other charge, including open space reservation charges, which is not the subject matter of the present challenge.

29. As regards interest, the petitioner has sought interest on the amount to be refunded. Having regard to the fact that the amount was collected under a demand now found unsustainable, the respondents shall refund the principal amount within the time stipulated below. In the circumstances of the case, this Court is not inclined to grant interest in addition to the principal amount.

30. For the foregoing reasons, the writ petition is allowed in the following terms:

(i) G.O.Ms.No.170, Housing and Urban Development (UDI) Department, dated 11.12.2018, is set aside insofar as it seeks to discontinue the benefit available to qualifying IT Park developments under Regulation 35(3), without compliance with the mandatory statutory procedure applicable to such an amendment.

(ii) The impugned demand dated 20.09.2019, in Item No.8, insofar as it relates to the levy of premium FSI charges on the petitioner’s proposed IT Park development, is set aside.

(iii) The respondents are directed to refund to the petitioner the sum of Rs.1,08,50,000/- paid towards premium FSI charges under protest, subject to the verification specified in paragraph 27 above, within a period of eight weeks from the date of receipt of a copy of this order. In the event of default, the said amount shall carry interest at the rate of 6% p.a. from the date of default till actual payment.

(iv) . Consequently, the connected Miscellaneous Petition is closed. There shall be no order as to costs. 03-11-2026 Index: Yes/No Speaking/Non-speaking order Neutral Citation: Yes/No ak To

1. The Secretary to Government, Housing and Urban Development Department, Fort,St George,Chennai-9.

2. Chennai Metropolitan Development Authority Rep by its member Secretary, Thalamuthu Natarajan Maligai, No.1,Gandhi Irwin Road, Chennai- 600 008.

HEMANT CHANDANGOUDAR, J. ak W.P No. 7484 of 2021 03-11-2026