- 1 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 23RD DAY OF JULY 2025 BEFORE THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR WRIT PETITION NO. 105552 OF 2023 (LB-RES) BETWEEN: THE THALAKWADI RECREATION ASSOCIATION AND LIBRARY, BUDHAWARPETH, TILAKWADI, BELAGAVI-590006, BY IT’S PRESIDENT, SRIKRISHNA S/O. YASHWANT PRABHU, AGE: 69 YEARS, OCC: PRESIDENT, R/O. CTS NO.199, BUDHWARPETH, TILAKWADI, BELAGAVI-590001. …PETITIONER (BY SRI. D. RAVIKUMAR GOKAKAKAR, ADVOCATE) AND: THE COMMISSIONER, CITY CORPORATION OF BELAGAVI, ASHOK NAGAR, BELAGAVI, TAL: AND DIST: BELAGAVI-590001. …RESPONDENT (BY SRI. CHETAN MUNNOLI, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE A WRIT, ORDER OR DIRECTION IN THE NATURE OF CERTIORARI QUASHING ANNEXURE-A I.E THE NOTICE DATED 24-05-2023 BEARING NO. MANBE/KAMSHA/MARKET/2023-24/LEASE-1CR-2 ISSUED BY THE RESPONDENT AND ETC. THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, ORDER WAS MADE THEREIN AS UNDER: VIJAYALAKSHMI M KANKUPPI Location: HIGH COURT OF KARNATAKA DHARWAD BENCH - 2 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 ORAL ORDER (PER: THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR) 1. This petition is filed by the petitioner, which is a recreational association/club. The same is registered under the Karnataka Societies Registration Act, 1960 (hereinafter referred to as ‘the Act’, for short) to conduct recreational activities to promote social amenities, indoor activities, games and to maintain library and other activities for the welfare and well being of the members of the society of the neighbourhood. The petitioner, after taking up the premises on lease, has put up substantial construction in the 11426 sq.ft. There is a lease agreement entered into by the erstwhile Municipality, Belgaum. The lease was granted for perpetuity for a sum of Rs.1/- and to be revised every 30 years. The petitioner has been paying the tax to the corporation to the tune of Rs.61,000/- every year and it is solely established for social purpose. 2. This being the state of affairs, the respondent has made a demand of Rs.1,20,66,279/- as ground rent, - 3 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 which is illegal, arbitrary and unilateral decision taken contrary to the lease agreement. The petitioner has replied to the said demand notice stating that the premises is taken up solely for social purpose with marginal profit with ground rent of Rs.1/- which was fixed by the then Municipality, therefore, the question of imposing such a huge commercial rent to an extent of Rs.1,20,66,279/- is exorbitant, illegal, arbitrary and same requires to be quashed. Due to the pressure and continuous harassment by the respondent, the petitioner had approached this Court in Writ Petition No.105393/2022. This Court after hearing the parties to the proceedings disposed of the petition reserving liberty to the petitioner to submit additional representation along with the documents to the respondent, who was directed to consider the same and proceed further in accordance with law by its order dated 14.02.2023. 3. This being the state of affairs, the respondent has once again issued demand notice which is at Annexure-A demanding the petitioner to pay huge amount of - 4 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 Rs.2,63,30,458/-. It is the contention of the petitioner that the respondent is now taking coercive steps to realize the amount and pressurizing the petitioner to make good the amount disturbing the peaceful atmosphere of the club activities run in the club. Hence, the petitioner is before this court challenging the said demand notice of the respondent to consider that the lease agreement is not for commercial purpose and it is for social cause and social purpose and social activities are being run. 4. It is contended by the learned counsel for the petitioner that the respondent has arbitrarily issued the demand notice after 90 years. It is also contended that the respondent has totally overlooked the purpose and object of the lease granted in favour of the petitioner and has now imposed huge deposit amount and the ground rent amount which is exhorbitant and not applicable to the petitioner as it is not running a commercial establishment. Therefore, he contends that the same is misconceived and a deliberate attempt to coerce the petitioner to either pay the amount or - 5 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 vacate the premises. On these grounds, the petitioner is before this Court. 5. Per contra, learned counsel for the respondent contends that the lease agreement was initially given for a period of 30 years on perpetual lease for Rs.1/ with several covenants in the said lease agreement. It is contended by the learned counsel for the respondent that the petitioner has violated the terms and conditions of the lease. It is also contended by the respondent that, it has a right and liberty to impose the ground rent even according to the document of perpetual lease after a period of 30 years as mentioned in the lease agreement. It is also contended that the petitioner is running a bar in the club premises. Therefore, he seeks to dismiss the petition and sustains the demand notice issued at Annexure-A for payment of rent and deposit. 6. I have heard the learned counsel for the petitioner and the learned counsel for the respondent. - 6 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 7. It is not in dispute that the respondent has given the subject premises to the petitioner on perpetual lease by collecting ground rent of Rs.1/- and making a provision for revising the ground rent every 30 years from the date of allotment. The question as to whether the respondent has power to revise the ground rent at its own discretion, unilaterally, or whether the consent and deliberation has to be made with the petitioner while enhancing the ground rent after expiry of 30 years and continuous thereof and whether it has right to demand the deposit amount, as sought for in the demand notice and whether the petitioner has violated the terms and conditions of the lease agreement, all are disputed questions of fact which cannot be gone into by this Court under the jurisdiction of Article 226 of the Constitution of India. This is precisely the reason why in the earlier round of litigation this Court had given liberty to the petitioner to make a representation to the respondent-authority and the respondent was directed to consider the same in accordance with law and pass suitable orders. It is the contention of the learned counsel for the petitioner that, after the order was - 7 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 passed in the earlier round of litigation, they had approached the respondent-authority and the present demand notice is issued which is questioned in this petition. It is for the petitioner to take appropriate action with regard to perpetual lease which is executed by the respondent. Whether the respondent can enhance the rent after 30 years and to what extent and whether the deposit amount can be imposed on the petitioner and to what extent, as stated earlier, this Court cannot go into these aspects of enquiry into the lease agreement and decide the rights of the parties. Under the circumstances, this Court will not be in a position to decide the disputed questions of fact nevertheless the demand that is made may not be correct for the reason that it is unilaterally passed by the respondent-authority. As decided by this Court earlier, the respondent will consider the representation of the petitioner and pass suitable orders which has not been done in the present case. Therefore, the respondent shall call upon the petitioner and conduct an enquiry as to what are the activities that are conducted in the club and based on the neighbourhood localities and the - 8 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 rent that is collected in the nearby area, fix a reasonable rent which is applicable to the adjacent neighbours and pass suitable orders. 8. Accordingly, I pass the following ORDER i. Writ petition is disposed of. ii. The impugned order dated 24.05.2023 bearing No.Manabe/Kamsha/Market/2023-24/Lease-1CR- 2 issued by the respondent vide Annexure-A is hereby quashed. iii. The respondent is hereby directed to consider the representation already filed by the petitioner. The respondent shall conduct an enquiry with regard to the rent applicable in the nearby neighbourhood and the adjacent buildings in the locality where the club is being run and pass a reasonable order. While doing so, the respondent - 9 - HC-KAR NC: 2025:KHC-D:9094 WP No. 105552 of 2023 shall give a notice and hear the petitioner and pass suitable orders after affording an opportunity to the petitioner. The same, however, shall be in accordance with law. Ordered accordingly. Sd/- (PRADEEP SINGH YERUR) JUDGE Kmv CT-MCK