Karnataka High Court
M/S. S. M. Enterprises vs The State Of Karnataka on 18 March, 2025
Author: M.Nagaprasanna
Bench: M.Nagaprasanna
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NC: 2025:KHC:11303
WP No. 7951 of 2025
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 18TH DAY OF MARCH, 2025
BEFORE
THE HON'BLE MR JUSTICE M.NAGAPRASANNA
WRIT PETITION NO. 7951 OF 2025 (GM-FOR)
BETWEEN:
M/S. S.M. ENTERPRISES
OFFICE AT NO.1827,
31ST CROSS, 11TH MAIN,
BANASHANKARI 2ND STAGE,
BANGALORE- 560070
REPRESENTED BY IT'S PROP:
SYED ABU SUFIYAN
S/O SYED NISAR AHAMED H,
AGED ABOUT 28 YEARS,
...PETITIONER
(BY SRI. SRINIVAS V., ADVOCATE)
Digitally signed
by NAGAVENI
Location: High AND:
Court of
Karnataka
1. THE STATE OF KARNATAKA
REP. BY PRINCIPAL SECRETARY
AND ADDITIONAL CHIEF SECRETARY,
DEPARTMENT OF FOREST,
ECOLOGY AND ENVIRONMENT,
4TH FLOOR, M.S.BUILDING,
DR.AMBEDKARVEEDHI,
BENGALURU-560001
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NC: 2025:KHC:11303
WP No. 7951 of 2025
2. THE PRINCIPAL CHIEF CONSERVATOR OF FORESTS,
(HEAD OF FOREST FORCE) ARANYABHAVAN,
18TH CROSS, MALLESHWARAM,
BENGALURU-560003.
3. THE CHIEF CONSERVATOR
OF FORESTS, SHIMOGA CIRCLE,
SHIMOGA -577 201
4. THE DEPUTY CONSERVATOR
OF FORESTS
SOCIAL FOREST DIVISION
SHIMOGA-577 201
...RESPONDENTS
(BY SRI. RAHUL CARIAPPA, AGA)
THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO A) DECLARE BY ISSUANCE OF
APPROPRIATE WRIT OR ORDER OR DIRECTION THAT THE STATE
GOVERNMENT AND ITS AUTHORITIES CANNOT LEVY, DEMAND AND
COLLECT FOREST DEVELOPMENT TAX AT THE RATE OF 12 PERCENT
OF THE SALE CONSIDERATION AMOUNT UNDER SECTION 98-A(1)
OF THE KARNATAKA FOREST ACT, 1963 IN RESPECT OF THE TIMBER
AND FOREST PRODUCE AUCTIONED/SOLD BY THE FOREST
DEPARTMENT IN DIFFERENT GOVERNMENT DEPOTS IN KARNATAKA
IN VIEW OF THE JUDGMENT RENDERED BY THE DIVISION BENCH OF
THIS HONBLE COURT ON 04.10.2017 IN THE CASE OF SRI. B.
RUDRAGOUDA AND OTHERS VS STATE OF KARNATAKA AND OTHERS
AND ALSO IN THE SUBSEQUENT WRIT PETITIONS, IN THE INTEREST
OF JUSTICE AND EQUITY AND ETC.
THIS PETITION, COMING ON FOR PRELIMINARY HEARING,
THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
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NC: 2025:KHC:11303
WP No. 7951 of 2025
CORAM: HON'BLE MR JUSTICE M.NAGAPRASANNA
ORAL ORDER
Heard the learned counsel Sri.V.Srinivas, appearing for
the petitioner and the learned Additional Government Advocate
Sri.Rahul Cariappa, appearing for the respondents.
2. The petitioner is before this Court seeking the
following prayer:
"a) Declare by issuance of appropriate writ or order or
direction that the State Government and its
authorities cannot levy, demand and collect 'Forest
Development Tax' at the rate of 12% of the sale
consideration amount under Section 39-A(1) of the
Karnataka Forest Act, 1963 in respect of the timber
and forest produce auctioned/sold by the Forest
Department in different Government Depots in
Karnataka In view of the Judgment rendered by the
Division Bench of this Hon'ble Court on 04.10.2017
in the case of Sri. B. Rudragouda and others -vs-
State of Karnataka and others and also in the
subsequent Writ Petitions, In the Interest of justice
and equity.
b) ISSUE A WRIT OR CERTIORARI or any other writ or
like nature and quash the Bill/Tax Invoice (Sale
Confirmation Order) dated _/03/2025 bearing Bill No
01/2024-25 issued by respondent No.4 only in so far
as demand of Forest Development Tax at the rate of
12% on the sale value totally amounting to
Rs.9,29,280 vide Annexure D to the writ petition
and,
c) Grant such other relief, order or direction as this
Hon'ble Court deems fit under the facts and
circumstances of case."
NC: 2025:KHC:11303
3. The petitioner is the successful bidder pursuant to a
tender notification issued for the purpose of sale of timber. The
timber is not being allowed to be lifted by the respondent -
Corporation on the score that they should pay the Forest
Development Tax.
4. The issue stands answered by plethora of
judgments rendered by this Court that Forest Development Tax
cannot be demanded on such tender processes.
5. The learned counsel for the petitioner seeks to
place reliance upon the judgment rendered by the coordinate
Bench of this Court in W.P.No.5253/2025 disposed on
21.02.2025, wherein the coordinate Bench has held as
follows:
" Learned AGA takes notice for all the Respondents.
2. Learned counsel for the petitioner submits
that although a Division Bench of this Court in the case
of Sri. B. Rudragouda Vs. State of Karnataka and
Others reported in AIR 2018, KAR 19 has held that
the respondent-State is not entitled to raise a demand
or collect Forest Development Tax and in a Special
Leave Petition filed by the State in C.A.Nos.3974-
4068/2016 and connected matters the Hon'ble Apex
Court has only stayed the order of the Division Bench
insofar as refund of the tax already collected is
concerned. Nevertheless, demand is raised in respect
NC: 2025:KHC:11303
of Forest Development Tax as could be seen at
Annexure-E.
3. With regard to the directions issued by the
Division Bench in the case of B. Rudragouda and the
fact that the Hon'ble Supreme Court has stayed only
that portion of the order pertaining to refund of the tax
already collected, the respondent authorities are
directed to take note of the directions issued by the
Division Bench and they will not be permitted to raise
such a demand regarding Forest Development Tax.
4. In view of the decision rendered by the
Division Bench, the impugned demand notice at
Annexure-E dated 07.02.2025 to the extent of levy of
Forest Development Tax, is set aside.
The Writ petition stands disposed of accordingly.
In view of the disposal of the main matter,
I.A.No.1/2025 does not survive for consideration and
the same stands disposed of."
6. In that light, the petition deserves to succeed and
for the aforesaid reasons, the following:
ORDER
i) The writ petition is disposed; and
ii) The impugned Bill/Tax Invoice at Annexure - D
dated __03/2025 bearing Bill No.01/2024-25 issued
by respondent No.4, is set aside.
Sd/-
(M.NAGAPRASANNA)
JUDGE
KG
