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CASE NO.: Appeal (civil)  4725 of 2002

PETITIONER: Hira Tikkoo

RESPONDENT: Union Territory, Chandigarh & Ors.

DATE OF JUDGMENT: 13/04/2004

BENCH: Shivaraj V. Patil & D. M. Dharmadhikari.

JUDGMENT: J U D G M E N T

With

Civil Appeal Nos. 4732-47,4748-49, 4728, 4729, 4750-51, 4730-31, 5319,  7260, 4752-4807, 4726-27, 4808-4809 of 2002 & 7109 of 2003 and SLP (c)  Nos. 5115-17 of 2002.  

Dharmadhikari J.

       These appeals and special leave petitions are preferred against   the common judgement dated 30.8.2001 passed by the Division Bench  of High Court of Punjab & Haryana whereby a batch of writ petitions  preferred by the applicants for allotment of industrial plots in the  development scheme framed by the Union Territory, Chandigarh  [shortly referred to as UTC] has been disposed of with certain  directions. Different  classes of allottees of industrial plots and UTC all  feel aggrieved by the judgment of the High court and are before this  Court.  

       The full factual background leading to the dispute inter se  between the applicants for industrial plots and UTC is required to be  set out :-  

With a view to re-enact  and modify the law in relation to the  development and regulation of the new capital of Punjab at  Chandigarh, Legislation by name Capital of Punjab [Development and  Regulation] Act, 1952 [shortly referred to as the Act] was passed in  the year 1952 vesting the State Government with legal authority to  regulate the sale of building sites. In exercise of powers under the Act,  rules for allotment of sites for building have been framed known as the  Chandigarh Lease Hold  of Sites and Building Rules, 1973 [hereinafter  referred to as the Rules], which among others provide that the  Administration of UTC, may demise ’sites for industries and buildings  by allotment or auction.  

In accordance with the provisions of the Act and Rules  mentioned above, the Administration of UTC issued an advertisement  No. 1/81 on 14.4.1981 inviting applications from interested  entrepreneurs seeking allotment of the industrial plots of different  sizes ranging from 10 marlas to 4 kanals. Pursuant to the said  advertisement, 3735 applications were received from different parties.  The Screening Committee  of the Administration of  UTC on 16.7.1982  short-listed 339 parties for allotment of industrial plots of different  sizes after studying their project reports and conducting interviews.  The 339 successful applicants, selected for allotment of plots of  different sizes, were directed to deposit 25% of the total cost of the  plots. On 30.11.1982, for allotting specific plots, a draw of lots was  held  among 339 successful allottees. As a result of the draw of lots,

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57 parties were given possession of their plots in developed industrial  areas i.e. Phase-I and Phase-II. Twenty one parties took refund of  their money. Seven allottees were given option for change of their  plots. Remaining 254 allottees could not be given possession of the  plots, allotted to them, as there were objections from the State  Authorities to the industrial development of the land it being covered  by the notification, issued in the year 1961, declaring area of the land  as reserved forest. The Administration of UTC could not deliver the  possession of that land which was covered in the reserved forest, to  254 allottees of the year 1989 but it continued to accept the yearly  installments fixed for payment from the selected allottees.  

Certain allottees filed writ petitions in the year 1987 in the High  Court seeking directions to the Administration of UTC to deliver  possession of the industrial plots allotted to them in accordance with  the short-listing done by  the Screening Committee and consequent  draw of lots.  

On 29.11.1990, the Director of Industries, Government of India,  intimated to the allottees that the Administration of UTC was not in a  position to deliver possession of the industrial plots allotted to them as   the land was found to be a part of reserved forest. The Administration  proposed to allot one kanal land to each allottee irrespective of the  size of plot originally allotted.  

On 10.12.1990, the Administration of UTC then framed a new  industrial policy to accommodate 250 allottees of 1982 who could not  be given possession of the industrial plots because of the land being  reserved for forest. To meet aforesaid difficult situation, the  Administration decided to reduce the size of 4 kanal and 2 kanal of  industrial plots by 25% so as to accommodate and to enable itself to  allot plots to all 254 allottees. In view of the new industrial policy of  1990, the earlier letter dated 29.11.1990 proposing each allottee one  kanal of plot was withdrawn. On 05.2.1991, a letter was issued to  allottees of plots measuring 4 kanal and 2 kanal to give their consent  for accepting reduced size of plot by 25% of the original plot allotted  to each of them. The option was invited within a period of 30 days. No  option was asked from the allottees of plots measuring one kanal and  10 marlas.  

Some allottees had given their consent who shall be hereinafter  referred to shortly as  ’the consentees’.   

Many others who did not give their consent for reduced size of  plots challenged the action of the Administration of UTC in the High  Court. The new declared industrial policy of 1990 was also challenged.  Such allottees who did not give consent for smaller sizes of plots and  approached the High Court shall be, hereinafter, referred to as ’the  non-consentees’. These non-consentees in the petitions filed by them  in the High Court obtained stay against the draw of lots scheduled to  be held on 27.3.1991 for allotment of specific plots of smaller sizes to  the consentees. The non-consentees made a three-pronged attack in  the writ petitions by challenging the notification of declaring the area  as reserved forest, the new industrial policy of 1990 and the decision  to reduce the size of plots taken by the Administration of UTC. A single  Judge of the High Court by order dated 15.11.1991 dismissed the writ  petitions filed by the non-consentees. But as the Administration of UTC  was found to be blameworthy  for the situation created, the learned  single Judge merely expressed a wish that they would be  accommodated in the alternative schemes. After decision of the case  by the single Judge of the High Court, the Administration of UTC on  07.2.1992 issued a letter asking all the 254 allottees to furnish an  affidavit in prescribed form indicating that none of them possessed any  industrial plot in the territory of Chandigarh, Panchkula or Mohali in  his/her name or in the name of his/her spouses/children. This affidavit

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was demanded in terms of the new industrial policy of 1990. Out of  254 allottees only 161 consentees gave their affidavits. Some of the  non-consentees again approached the High Court challenging the new  industrial policy of 1990 by filing fresh petitions and others filed letters  patent appeals. In their petitions and appeals, they insisted on grant of  relief of directing delivery of possession of the original plots allotted to  them. The filing of this petition and appeals resulted in stalling the  allotments of alternative plots pursuant to the new industrial policy of  1990 even to consentees who had agreed for plots of reduced sizes at  alternative locations and had filed affidavits in the requisite form. The  consentees approached the High Court with a prayer that the  Administration be directed to give them possession of the alternative  plots of smaller sizes. The Division Bench of the High Court passed an  order dated 22.11.1994 and by modifying its earlier order dated  13.1.1992 clarified that the Administration of UTC can proceed to allot  the industrial plots to consentees subject to the condition that the  plots of the size allotted to the non-consentees, who are in litigation,  shall be kept reserved and not reduced.  Despite the above  modification and clarification made by the High Court, the  Administration of UTC did not deliver possession of the plots even to  consentees stating that in some other cases, stay orders against the  allotments were operating against the Administration.   On 12.8.1995,  the High Court again modified its earlier orders and gave liberty to the  Administration to give possession of alternative plots  to consentees.  Despite the above order, the Administration of UTC did not choose to  deliver possession of the alternative plots even to consentees as in  their view, the interim orders of the High Court restrained  them from  reducing the size of plots allotted to non-consentees.  

The consentees then approached by substantive petitions before  the High Court seeking relief in their favour of issuing direction to the  Administration of UTC to deliver possession of alternative plots to  them. In response to the writ petitions filed by consentees, the  Administration expressed its inability to deliver possession of the plots  even to consentees. It was stated that some part of the land to be  allotted as alternative plots falls within the restricted zone under the  notification issued under the Aircrafts Act  for Air-Force base.

The Division Bench of the High Court, after long drawn hearing  and detailed consideration of the competing claims  of consentees and  non-consentees as also the stand of the Administration, passed a  common judgement with the directions which are subject matter of  these appeals preferred by non-consentees who are aggrieved by  denial to them of alternative plots. Consentees feel aggrieved by  direction permitting from them demand of the price at the rate  prevailing on the date of draw of lots i.e. 27.3.1991. According to the  Chandigarh Administration, during long pendency of litigation, a new  industrial policy of 2001 has been promulgated in which one phase of  industrial area is to be reserved for setting up the Information  Technology industries. The Administration is aggrieved by the  directions permitting them to charge price only at the rate prevailing  on the date of draw of lots i.e. 27.3.1991 and not at  current rate.  

Amongst the consentees and non-consentees, there are  individuals and parties who did not file any writ petitions in the High  Court and as the relief granted is restricted to the parties before the  court, such parties and individuals have filed applications seeking  intervention and/or impleadment  as parties in this group of appeals.  

The directions given by the High Court in the impugned  judgment are as under :-  

1.      The prayer of the appellants/petitioners for directing the  authorities of Chandigarh Administration to hand over  possession of the  plots allotted on the basis of draw held in

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November, 1982 is rejected.  

2.      However, the authorities of Chandigarh Administration are  directed to issue allotment letters to those  appellants/petitioners who had given consent for allotment of  alternative plots of smaller sizes and who were  successful  in the draw held on 27.3.1991. They should be charged   price at the rate prevailing on the date of draw.  

3.      Those who were declared successful in the draw held on  27.3.1991 but cannot be allotted plots due to non-availability  of sufficient  land in the wake of prohibition  imposed vide  notification dated 5.1.1988 shall be allotted plots in any  other scheme already framed or which may be framed   hereafter by Chandigarh Administration.  

4.      Those who were declared successful in the draw held in  1982, but did not give consent for allotment of alternative  plots shall be  refunded the amount deposited by them with  interest at the rate of 12% from the date of deposit till the  date of actual payment.  

5.      Within one month from the date of receipt of this order,  Chandigarh Administration shall get published in the Tribune  the list of the applicants who had given consent for allotment  of alternative plots and were declared successful in the draw  held on 27.3.1991 specifying the number of plots earmarked  for them.  

6.      Notification dated 28.4.2000 is held inapplicable and  inoperative qua the allotments made to the  appellants/petitioners on the basis of the draw held on  27.3.1991.  

....................

In this Court when the arguments commenced, it was felt by all  parties involved as also by this Court that some amicable solution  reasonably acceptable to all the parties can be found out on the basis  of mutual discussions and negotiations between the authorities of the  Chandigarh Administration, the contesting consentees and non- consentees.  

Despite giving them repeated opportunities to settle the matter  through negotiations, we are unhappy to record that the counsel for  the parties reported that efforts to amiably solve the issue have failed.  

Learned senior counsel Shri M. L. Verma appearing for the non- consentees very fairly stated that the notification reserving certain  lands for the forest and the restrictions imposed on construction in  periphery of 900 metres from the Air-Force base under the Aircrafts  Act cannot be questioned and that part of the judgment of the High  Court is not being assailed in these appeals. With regard to the  restrictions under Aircrafts Act, it is however, pointed out that the  period of restriction under notification dated 22.5.2001 has expired  and therefore, the said restriction of 900 metres under the Aircrafts  Act is no longer in operation.  

Learned counsel appearing for the Administration of UTC  had  pointed out to us that the contents of the letter dated 20.11.2003  received by the Administration from Ministry of Defence, Government  of India do show that the period of notification imposing restriction has  expired but it has been intimated in the same letter that the similar  restriction is under contemplation and a fresh notification imposing  same is likely to be issued in future. In the aforesaid circumstances,

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learned counsel for the Chandigarh Administration submitted that  allotment of alternative plots within 900 metres would be subject to  any imposition of restriction under the Aircrafts Act and if such  restrictions are imposed, the allottees of plots falling in that area  would have no right to claim any compensation or damage from the  Administration.  

We shall take up first for consideration the grievances raised and  the challenges made to the directions of the High  Court by the learned  counsel appearing on behalf of the non-consentees. On their behalf,  learned counsel states that amongst them are large number of  allottees who, on having been only given letter of allotment, have paid  full price of the plots. Lease-deeds have been executed in their favour  and they have been placed in formal possession of the plots although   they have not been allowed to take physical possession and raise  super-structures. Such allottees, it is contended, have acquired a  vested right to obtain the plots. Reliance is placed on section 3(3) of  the Act read with rules 4, 6 & 10 of the Rules which read as under :-  

"Section 3. Power of Central Government in respect of transfer  of land and building in Chandigarh. \026 (1).............. (2) ................... (3) Notwithstanding anything contained in any other law for the  time being in force, until the entire consideration money  together with interest or any other amount, if any, due to the  Central Government on account of the transfer of any site or  building, or both, under sub-section (12) is paid, such site or  building, or both, as the case may be, shall continue to belong  to the Central Government.  

Rule 4. The Chandigarh Administration may demise sites and  buildings at Chandigarh on lease for 99 years. Such leases may  be given by allotment or by auction in accordance with these  rules.  

Rule 6. Commencement and period of lease. \026 The lease shall  commence from the date of allotment or auction, as the case  may be, and shall be for a period of 99 years. After the expiry of  the said period of 99 years, the lease may be renewed for such  further period and on such terms and conditions as the  Government may decide.  

Rule 10. Delivery of possession. \026 Actual possession of the  site/building shall be delivered to the lessee on payment of 25  per cent of the premium in accordance with rule 8 or rule 9 as  the case may be.  

Provided that no ground rent payable under rule 13 and interest  on the instalments of premium payable under sub-rule(2) of rule  12 shall be paid by the lessee till the actual and physical  possession of the site/building is delivered or offered to be  delivered to him, whichever is earlier.  

Some decisions, which need not detain us for consideration,  were cited to contend that on execution of lease-deads, payment of  price and formal delivery of possession of the plots, a vested right in  law in the plots allotted has been created in favour of the allottees  regardless of their consent or non-consent for alternative plots.  

We have examined the scheme and provisions of the Act and the  Rules. They do not seem to contemplate creation of any vested right  where any other state or central legislation bars use of a particular  land for industrial development. The Chandigarh Administration, in

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these cases, had prepared a scheme, carved out plots, auctioned them  and received part or full payment of the price. In implementing its  development scheme, it ignored the notification issued reserving a  major portion of the land covered by the scheme as ’forest’. It is in  this circumstance that the Administration is showing its inability to  honour the commitment made by offering the plots, acceptance of  price and giving delivery of possession. When a scheme of  development of land and the allotments made thereunder are found to  be in contravention of any law and contrary to general public interest,  no claim based on so called vested right can be countenanced. Similar  is the position with regard to 900 metres restriction imposed under the  Aircrafts Act. No citizen can be allowed to claim any vested right which  would result in violation of a statutory provision of law or Constitution.  The claim, therefore, based on alleged vested right, has to be outright  rejected.    

The learned senior counsel then made some attempts to rely on  the doctrines of ’promissory estoppel’ and ’legitimate expectation’.  Doctrine of ’legitimate expectation’ has developed as a principle of  reasonableness and fairness  and is used against statutory bodies and  government authorities  on whose representations or promises, parties  or citizens act and some detrimental consequences ensue because of  refusal of authorities to fulfil their promises or honour their  commitments. The argument under the label of ’estoppel’ and  ’legitimate expectation’ are substantially the same. The Administration  herein no doubt is guilty of gross mistake in including in its  development scheme, a portion of land covered by the forest and land  with restrictions under the Aircrafts Act. A vital mistake has been  committed by the Chandigarh Administration in overlooking the  notification reserving land under the Forest Act and the restrictions  imposed under the Aircrafts Act, but overriding public interest  outweighs  the obligation of a promise or representation made on  behalf of the Administration.  Where public interest is likely to be  harmed, neither the doctrine of ’legitimate expectation’ nor     ’estoppel’ can be allowed to be pressed into service by any citizen  against the State Authorities. In M/s Jit Ram Shiv Kumar & Ors. vs.  State of Haryana & Ors. [1981 (1) SCC 11], a two-Judge Bench of  this Court by explaining and distinguishing Union of India vs. Indo- Afgan Agencies Ltd., [1968 (2) SCR 366] and Motilal Padampat  Sugar Mills Co. (P) Ltd. vs. State of U.P. [1979 (2) SCC 409],  observed thus :-  

’It is only in public interest that it is recognized that an authority  acting on behalf of the government or by virtue of statutory  powers cannot exceed his authority.  Rule of ultra vires will  become applicable when he exceeds his authority and the  government would not be bound by such action.  Any person  who enters into an arrangement with the government has to  ascertain and satisfy himself that the authority who purports to  act for the government, acts within the scope of his authority  and cannot urge that the government is in the position of any  other litigant liable to be charged with liability’.

In the aforesaid case of M/s Jit Ram Shiv Kumar (supra), the  Municipal Committee of Bahadurgarh town to develop a Mandi  promised that the traders who purchase plots in Mandi would be  exempted from paying octroi duty on goods imported for trade to the  Mandi. The State Government in exercise of powers under the Punjab  Municipal Act directed the Municipal Committee to withdraw the  exemption from payment of octroi duty. When the traders, who had  set up their business in the Mandi on promise of getting exemption  from octroi duty, challenged the action of the Municipality and the  Punjab Government and raised on plea of ’estoppel’ \026 it was rejected  by this Court by relying on the decision of Constitution Bench of this

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Court in the case of  M. Ramanatha Pillai vs. The State of Kerala &  Anr. [1973 (2) SCC 650] and  State of Kerala & Anr vs. The  Gwalior Rayon Silk Manufacturing (WVG.) Co. Ltd. Etc. [1973 (2)  SCC 713]. This Court in M/s Jit Ram Shiv Kumar (Supra), recorded the  following conclusion which supports the view we propose to take in the  circumstances of the present case :-  

’On a consideration of the decisions of this Court, it is clear that  there can be no ’promissory estoppel’ against the exercise of  legislative power of the State.  So also the doctrine cannot be  invoked for preventing the government from acting in discharge  of its duty under the law.  The government would not be bound  by the act of is officers and agents who act beyond the scope of  their authority and a person dealing with the agent of the  government must be held to have notice of the limitations of his  authority.  The court can enforce compliance by a public  authority of the obligation laid on him if he arbitrarily or on his  mere whim ignores the promises made by him on behalf of the  government.  It would be open to the authority to plead and  prove that there were special considerations which necessitated  his not being able to comply with his obligations in public  interest’.

In public law in certain situations, relief to the parties aggrieved  by action or promises of public authorities can be granted on the  doctrine of ’legitimate expectation’ but when grant of such relief is  likely to harm larger public interest, the doctrine cannot be allowed to  be pressed into service. We may usefully call in aid Legal Maxim :  ’Salus populi est suprema lex : regard for the public welfare is the  highest law. This principle is based on the implied agreement of  every member of society that his own individual welfare shall in cases  of necessity yield to that of community. His property, liberty and life  shall under certain circumstances be placed in jeopardy or even  sacrificed  for the public good’.  

On the same principle and to protect larger public interest, the  Chandigarh Administration can be relieved of fulfilling legitimate  expectation arising from its allotment of plots on the ground that their  development schemes under consideration have been found to be in  contravention of Forest Act and Aircrafts Act. Another legal maxim  which can be invoked to their aid is : ’Lex non cogit ad impossibilia :  the law does not compel a man to do that which he cannot  possibly perform’.  

        The allottees of the plots are, no doubt, faced with an uncertain  situation with loss already caused to them due to negligence and  mistake on the part of the Planning Authorities of the Chandigarh  Administration. In preparing the development scheme, the existing  notification reserving major part of land as forest under the Indian  Forest Act and restriction on construction in periphery of 900 metres  from the Air-force base under the Aircrafts Act were overlooked. As we  have held above, on a representation that the land is available for  allotment of industrial plots, the allottees staked their money and  plans for setting up their industries. The representations made to them  by the Planning Authorities have turned out to be misleading as a  substantial part of the land could not have been included in the  development scheme. The allottees  paid price for the plots and  incurred expenses in preparing their industrial projects. We have held  above that the doctrine of  ’legitimate expectation’ and ’estoppel’  cannot be applied against the Administration to compel it to allot the  original plots because that would be permitting violation of Statutes  intended to conserve forest and restrictions imposed in the interests of  general public and security of Nation under Aircrafts Act. Doctrine of  ’estoppel’ cannot, therefore, be allowed to be urged against the

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Administration. This Court cannot direct the Administration to commit  breach of statutory provisions and thus harm general public interests.  De Smith, Woolf and Jowell in their authoritative book on ’Judicial  Review of Administration Action’ [5th Edition at page 565 para 13-028],  have stated one of the principles of public law powers thus :  ’A  public body with limited powers cannot bind itself to act outside of its  authorised powers; and if it purports to do so  it can repudiate its  undertaking, for it cannot extend its powers by creating an estoppel’.  

Surely, the doctrine of estoppel cannot be applied against public  authorities when their mistaken advice or representation is found to be  in breach of a Statute and therefore, against general public interest.  The question, however, is whether the parties or individuals, who had  suffered because of the mistake and negligence on the part of the  statutory public authorities, would have any remedy of redressal for  the loss they have suffered. The ’rules of fairness’ by which every  public authority is bound, requires them to compensate loss   occasioned to private parties or citizens who were misled in acting on  such mistaken or negligent advice of the public Authority. There are no  allegations and material in these cases to come to a conclusion that  the action of the authorities was mala fide. It may be held to be  careless or negligent. In some of the English cases, the view taken is  that the public authorities cannot be absolved of their liability to  provide adequate monetary compensation to the parties who are  adversely affected by their erroneous decisions and actions. But in  these cases, any directions to the public authorities to pay monetary  compensation or damages would also indirectly harm general public  interest. The public authorities are entrusted with public fund raised  from public money. The funds are in trust with them for utilisation in  public interest and strictly for the purposes of the Statute  under which  they are created with specific statutory duties imposed on them. In  such a situation when a party or citizen has relied, to his detriment, on  an erroneous representation made by public authorities and suffered  loss and where doctrine of  ’estoppel’ will not be invoked to his aid,  directing administrative redressal would be a more appropriate remedy  than payment of monetary compensation for the loss caused by non- delivery of the possession of the plots and consequent delay caused in  setting up industries by the allottees.  

[See the Administrative Law by H.W.R. Wade & C.F. Forsyth, Eight Edition at pages  370-373. Also the book on ’Judicial Review of Administration Action’ by De Smith,  Woolf and Jowell, 5th Edition at page 565 para 13-028].

In the predicament aforesaid, the Administration has adopted a  fair attitude. It has come out with a  proposal to give alternative plots  but of smaller sizes because of the paucity of land available in  development schemes in Phase-I & II.    The     statutory compulsion  and the rule of fairness have both to be evenly balanced. This Court  cannot allow the Administration to commit breach of law and harm  public interest. At the same time, it cannot be absolved of its liability  to give appropriate redressal and compensation to the parties and  citizens who have suffered loss because of their grossly mistaken  decisions and actions. The allottees of the plots, when they were given  option to accept alternative plots of smaller sizes, ought to have  accepted the offer being the appropriate compensation to them in the  circumstances obtaining. The allottees who have consented to accept  alternative plots even of smaller sizes and others who did not consent,   maybe, because they were in litigation and required plots of bigger  sizes, constitute two different groups requiring different treatment in  the matter of directing grant of appropriate redressal to them by the  Administration.  

The learned counsel on behalf of non-consentees submitted  that in denying choice of alternative plots to non-consentees at par  with consentees, the High Court unreasonably discriminated the non-

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consentees. It is submitted that the non-consentees were legitimately  fighting for their rights for  the original plots allotted of required sizes  and which suited to their industrial projects. Merely because in the  course of court proceedings, draw of lots for alternative plots were  stayed and held up, is no ground to deny non-consentees the  allotment of alternative plots, when in many of their cases, full prices  have been paid, lease-deeds executed and even formal possessions  have been obtained although they could not set up industries. It is  submitted that the rule of fairness requires consentees and non- consentees be treated at par for allotment of alternative plots. No  prejudicial treatment could be meted out to non-consentees by  completely depriving them of alternative plots and merely directing  refund of their prices. In this respect, it is urged that pendency of  court proceedings should harm no one and mere approach to the law  courts for enforcement of their legal and constitutional rights should  not be taken as a circumstance against the parties. The contention  advanced is that discrimination between consentees and non- consentees is violative of right of equality guaranteed under Article 14  of the Constitution.  

We have also heard the learned senior counsel Shri M. N.  Krishnamani appearing for the consentees, who has very stiffly  opposed the claim for alternative plots advanced on behalf of the non- consentees. The plots of small sizes are limited in number in which  both consentees and non-consentees cannot be accommodated.  Learned counsel submits that differential treatment given to  consentees and non-consentees by the High Court is fully justified for  various reasons. It is submitted that the writ petitions filed by the non- consentees challenging the notification of reservation of land for forest  and their refusal to accept alternative plots of smaller sizes,  occasioned long delay in making available the alternative plots to all.  The consentees had to intervene and fight independently in the High  Court as also in this Court to obtain possession of the plots which they  could have obtained on the basis of their consent and draw of lots on  27.3.1991. It is submitted that non-consentees were mainly  responsible for stalling actions of the Administration and attempts by  them to accommodate as much number of allottees in the alternative  plots as was possible on the basis of availability of developed land and  the size of plots. They submitted that the non-consentees having  entered into a long drawn litigation against the Administration and  failed, they cannot now, for the first time in this Court, be allowed to  change their stand and compete with consentees in draw of lots for  smaller sizes of available alternate plots. The High Court, therefore,  was right in completely excluding the non-consentees from being  considered for grant of alternative plots. The other grievances  raised  on behalf of the consentees is with regard to direction no. 2 in the  judgment of the High Court by which the consentees have been  directed to be allotted alternative plots under draw of lots held on  27.3.1991 but on the price prevailing on the date of the draw of lots.  This part of the direction no. 2 of the High Court is questioned on  behalf of the consentees by stating that they had paid full or part price  for the original plots as allotted to them in the year 1982 and the said  money was throughout with the Administration. Now directing the  consentees to pay the price for the alternative plots on the price  prevailing on the date of draw i.e. 27.3.1991 is prima facie unfair and  highly burdensome because the consentees for no fault on their part  are made to pay much higher price. The Administration despite their  vital mistake in preparing schemes for the land partly covered by  reserved forest should not be allowed enrichment by allowing them to  charge higher price for smaller sizes of plots in the same scheme or  the alternative schemes.  

We have heard learned senior counsel Shri Rakesh Dwivedi  assisted by Ms. Kamini Jaiswal appearing for the Administration on the  question of charging of price for alternative plots of smaller sizes in the

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same scheme or the other schemes. The justification advanced for  demanding higher price is that in the course of long drawn litigation,  additional expenditure was required to be incurred for replotting and  prices of land have gone up in the meantime. It is also submitted that  it may not be possible to accommodate all consentees even for smaller  sizes of plots in the same scheme. Some of them will have to be  accommodated in other schemes. The acquisition cost of land in other  schemes is higher.  The direction of the High Court to charge from the  consentees for alternative plots, price as was prevailing on the date of  draw of lots held on 27.3.1991 is, therefore, described as highly  unreasonable.  

After considering the rival submissions made on behalf of various  parties, we are of the view that the rule of reasonableness and fairness  by which every statutory authority is bound, demands that the  consentees, who, for no fault on their part, were deprived of the  original plots of larger sizes,  should not be further made to suffer by  demanding from them higher price for the alternative plots of smaller  sizes. It would be highly iniquitous to demand from them higher price  for smaller sizes of plots and add to their losses caused by undue  delay in setting up their industries. The Administration is mainly to be  blamed for the situation in which the allottees of plots find themselves  today. In preparing scheme and allotting plots, it could not have  ignored the notification reserving a part of land for the forest and the  restriction to the extent of 900 metres around the Air-Force base.  The  allottees of the plots have paid full or part price and that amount  throughout remained with the Administration. In such circumstances,  the Administration must bear a portion of loss, if any, occasioned to it  and compensate to some extent the loss caused to the consentees  who never objected to allotment of alternative plots of smaller sizes.  The direction no. 2 of the High Court, therefore, to the extent of  charging price from the consentees as prevailing on the date of draw  of lots i.e. 27.3.1991, deserves to be set aside and substituted with  the directions that the consentees on being  allotted a particular plot of  smaller size shall be charged the same price which was prevailing at  the time of original allotment of the plot in their favour. Necessary  adjustment or refund of price, as the case may be, shall be given to  them for the small size of plot allotted.  

So far as the non-consentees are concerned, we are not  prepared to accept that by their action and/or inaction, they can claim   parity for allotment with the consentees. The consentees have to be  considered in priority as, at the first available opportunity, they agreed  to the offer of alternative plots of smaller sizes. The non-consentees  not only questioned the offer made by the Administration to provide  them plots of smaller sizes but even assailed the government  notification declaring major part of the land in the scheme as reserved  forest. They might have a legitimate right to approach the courts for  necessary reliefs but having failed in their challenges in the court, they  can claim no right of being treated similarly with consentees who  right  from the earliest opportunity were willing and trying through the   Administration and the court for early allotment of alternative plots.  The consentees and the non-consentees, on the basis of their actions  and inactions, constitute two different classes of allottees and a  differential treatment to them cannot be held to be unjustified or in  violation of Article 14 of the Constitution. On a just and reasonable  ground, the consentees deserve a more favourable treatment than  non-consentees more so because plots of small sizes available in the  existing scheme in Phase-I & II are extremely limited in number.  

After mutual negotiations for settlement between the allottees  and the Administration failed, the Assistant Estate Officer, Chandigarh  Administration has filed a detailed affidavit on 16.2.2004 showing the  latest position with regard to the availability of alternative plots in the  same scheme in phase-I & II for which the original allotments were

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made and in the new scheme in phase-III in Mouli Jagran. We have to  proceed on the facts mentioned in the latest affidavit dated 16.2.2004  filed on behalf of the Administration. It is necessary to briefly indicate  the facts and developments which have been brought to our notice in  the affidavit and the proposals now made on behalf of the  Administration to accommodate the consentees and non-consentees.  In the affidavit, it has been stated that after the order dated  17.9.2003 of this Court, parties involved in the litigation were invited  before a committee in  meetings held between 3.10.2003 to  12.12.2003. Other 164 applicants who were also parties  to the draw  of lots on 27.3.1991 and some of whom are intervenors or seeking  impleadments as parties were also invited as a measure personnel to  them. In accordance with the new industrial policy of 1990, the parties  in the court were required to furnish necessary information  in the  prescribed form as to whether in their own name or in the name of  their spouses and children they own any plot in Mohali, Panchkula and  in the Union Territory of Chandigarh. The second information  demanded was whether the applicant is a government or semi- government employee because there is prohibition for allotment of plot  to such employees.  

In the affidavit, it is further stated that, in accordance with the  new industrial policy, the environmental restrictions have been  imposed categorising  different industrial projects into three categories  i.e. Red, Orange and Green. In accordance with the environmental  norms, in the new industrial policy of 1990, the parties litigating were  given option to submit their fresh project reports. Some of the parties  neither provided necessary information on affidavit nor submitted their  revised project reports conforming to the environmental norms.  According to the Administration, allotments are possible only to such  parties who fulfil the conditions shown in the prescribed affidavit and  conform to environmental norms. On the basis of the information  received in the course of the mutual negotiations for settlement, it is  reported  to this Court that 47 projects fall in red category and 4  projects fall in orange category. These projects cannot be considered  to be set up as per the prevalent pollution norms. They can be  considered if they submit fresh project reports which comply with the  latest environmental/pollution norms and are viable in the existing  marketing conditions. It has been stated on affidavit by the  Administration that out of 35 consentees who have furnished the  necessary information, only 23 consentees are fulfilling the laid down  criteria. The names of those 23 allottees with full details are shown in  paragraph no. 7 of the affidavit and the names and details of other 12  consentee allottees  who did not furnish complete information and do  not fulfil the requisite conditions are also given in the same paragraph  of the affidavit.  

In the affidavit, there is a second category shown by the  Administration as comprising such allottees from whom consent  was not asked for as it was proposed to allot them the same size of  plot measuring one kanal which they had applied for. In this category,  from whom no consent was needed, are allottees of one kanal of plots.  Thirteen applicants have been found to have given complete  information and fulfilling requisite environmental norms. Their names  are  also mentioned under category-II of the affidavit.  

We have stated above that there is no justification for the non- consentees to claim parity with consentees. The third category pointed  out by the Administration and some of whom are also before us  represented through their counsel are allottees of one kanal of plots.  They are being offered same size of alternative plots and from them no  consent was asked for. This category of allottees of one kanal of plot  are also required to be accommodated in the available alternative  plots.

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On this identification of 23 consentees and 13 allottees of one  kanal of plot each, the Administration is justifiably required to consider  their cases to allot them alternative plots available in industrial areas  phase-I and phase-II as shown in their chart (Annnexure-A) annexed  to their affidavit. This chart (annexure-A) annexed to the affidavit shall  be read as part of our order and is reproduced as under :-  

ANNEXURE \026 A LIST OF INDUSTRIAL PLOTS LYING VACANT IN THE INDUSTRIAL AREA, PHASE I & II, CHANDIGARH.

-------------------------------------------------------------------------------------------- ------------------- Sr.     Category       Vacant      Trees & Other                Major   Encroachment           Total                                 Encroachments           like Elect. Transformer                                 Which can be            Electric pole, Telephone                                 removed         pole which cannot be                                                         removed -------------------------------------------------------------------------------------------- -------------------

INDUSTRIAL AREA PHASE I

1.      1.5 Kanal       1       4       -       5 2.        1 Kanal       1       8       -       9

INDUSTRIAL AREA PHASE II

3.        3  Kanal      -       1       -       1  4.        1.5 Kanal     3       18      1       22 5.        1  Kanal      18      1       1       20 6.        10 Marla      9       12      2       23             ----------            ---------                -----------                        -----------                 ---- ------- Total           32                      44                              4                                    80         ------------        -----------               -----------                       ---- -------                 ------------                              

From the available plots of different sizes totalling 80, both the  consentees and allottees of one kanal of plots have to be  accommodated. The directions made by the High Court in favour of the  consentees are, therefore, required to be suitably modified with  additional directions  which we propose to make in these batch of  cases :-  

So far as non-consentees are concerned, we have already held  above that they can claim no parity with the consentees and allottees  of one kanal of plots. The number of plots of smaller sizes are also  limited and therefore, the non-consentees cannot be allowed to  compete with consentees and allottees of plot of one kanal.  

In the latest affidavit submitted by the Administration mentioned  above, it has been stated that 152 acres of land has been acquired in  the Revenue Estate of village Mouli Jagran  and Raipur Kalan which fall  entirely outside the reserved forest area and are being developed as  industrial area phase-III. According to the Administration since  alternative sites available in industrial areas phase-I & II as mentioned

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in annexure-A are limited, all other left-out allottees can be  accommodated in industrial area phase-III. The Administration has,  however, stated that in the new industrial zone Mouli Jagran, the cost  of acquisition and development has been much higher calculated at  Rs.2,892 per sq. yard. Based on the above affidavit, the only relief  that can be granted to the non-consentees would be to permit them to  submit their willingness within a period of one month from the date of  our order in  writing to the Administration to be considered for  allotment of a suitable plot in the new industrial zone i.e. Mouli Jagran  but  at the price prevailing on the date of such fresh allotment.  Suitable direction is, therefore, required to be issued in favour of such  willing non-consentees.  

Now we are left with the individuals and parties falling in  none of the three categories i.e. 1) consentees, 2) non-consentees,  or  3) allottees of one kanal of plot. They were not parties before the  High Court and were invited to participate  in the discussions and  negotiations which have taken place during pendency of these cases  before us. They have approached by way of special leave petitions or  applications seeking interventions or impleadment as parties in the  present cases. This group of individuals and parties, who were not  parties before the High Court either as petitioners  or respondents and  who are merely intervenors or parties seeking impleadments and/or  have sought permission to file special leave petitions cannot be  allowed to join race for allotment of available alternative plots. It will  have to be presumed that having not ventilated their grievances and  enforced their rights, if any, at any earlier stage,  they have  abandoned their claims. Merely because during pendency of court  proceedings, some rounds of negotiations and discussions took place  in which the Administration also invited them, would not furnish them  a cause of action to raise their claims which they had earlier given up  by their inaction  and lapse. In adjusting equities and on rule of  fairness, those who have languished and slept over their rights have to  be denied any relief more so when there has been such a time lag  between the original allotment and the proposed allotment of  alternative plots. In the meantime, there have been various  developments including escalation of land prices. Any speculative deals  and attempt to take chance of getting allotment by such parties have  to be discouraged. We, therefore, refuse to grant any relief to  remaining class of consentees or non-consentees and other allottees  who were not parties in the litigation before the High Court.  

As a result of detailed discussion aforesaid, the appeals and  connected matters are disposed of by partly maintaining the directions  contained in the impugned order of the High Court but with the  modifications, substitution and addition of directions as mentioned  below :-  

1.      The prayer of the appellants/petitioners for directing the  authorities of Chandigarh Administration to hand over possession  of the  plots allotted on the basis of draw held in November,  1982 is rejected.

2.      The total available plots of different sizes as mentioned in  Annexure-A to the affidavit of the Administration of UTC,  shall  be allotted by draw of lots separately or jointly as per the  procedure evolved by the Administration to 23 consentees  found eligible in accordance with the new environmental norms  and to 13 allottees of one kanal plot. It is for the  Administration of UTC to work out the manner in which draw of  lots will be held between 23 consentees and 13 allottees of one  kanal plot for the available number of plots of different sizes as  contained in Annexure-A to the affidavit. It is made clear that  the Administration of UTC will have liberty, keeping in view the  industrial projects submitted by the consentees and other

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restrictions, if they make it necessary, to suitably alter the sizes  of plots to accommodate the identified 23 consentees. It is  clarified that allotment of plots from the area of the scheme  which falls within restricted 900 metres zone from the air-base  under Aircrafts Act, would be granted by the Administration with  a condition that if in future, any such restriction is reimposed,  the allotments may be cancelled and there would be no liability  on the Administration of UTC to pay any damage or  compensation to the parties due to non-utilisation of plots or its  cancellation. If the allotments of plots in the restricted zone are  cancelled due to restriction aforesaid, the price paid for the plots  shall be refunded to the parties concerned without any liability of  interest on the price which remained as deposit with the  Administration.  

3.      The consentees and allottees of one kanal plot, who even  though found eligible for allotment, because of limited number of  plots (as mentioned in annexure-A), do not get  accommodation in the available plots, they be considered on  the same price paid by them for alternative plots in the new  industrial area phase-III i.e. Mouli Jagran. It is made clear that  the requirement of the Act and the Rules and the new  environmental norms as existing on the date of fresh allotment  of plots in  the  industrial  area phase-III would be made  applicable to such consentees and allottees of one kanal plot.  

4.      The non-consentees shall be granted by the Administration of  UTC, option by asking them to submit their willingness in writing  within a period of one month from the date of this order for  considering allottment to each of  them a suitable plot in the new  industrial zone Phase III at Mouli Jagran. It is left to the  Administration of UTC to evolve a fair and just method of  allotment by draw of lots  in accordance with the Act and the  Rules. It is made clear that the allotment of plots in the new  industrial area III i.e. Mouli Jagran would be at the price  prevailing on the date of fresh allotments. The price already paid  by the non-consentees for their original plots, if so far not  refunded to them, shall be adjusted towards the total price  payable for the new sites. It is also made clear that in  accordance with existing industrial policy and the environmental  norms, the allottees will have to submit their project reports for  considering viability of their proposed industries by the  Administration.  

In the event, the non-consentees are unwilling to take  plots in the new industrial zone phase III  or their project  reports are ultimately found to be not approvable, the price  deposited by them for the original plots would be refunded to  them with interest at the rate of 12% per annum from the date  of initial deposit.

5.      The reliefs in the nature of directions made in favour of  consentees and non-consentees and allottees of one kanal plot  are restricted only to such of them who were parties  before the High Court.  All claims of remaining consentees or  non-consentees or allottees of one kanal plot,  who were not  parties in the cases before the High Court,  stand rejected.   

6.      Notification dated 28.4.2000 containing new Industrial Policy  would not be made applicable to the allottees of plots in phase-I  & II who are successful in fresh draw of lots to be held under the  above directions.

7.      The Administration of UTC shall complete the requisite  formalities and carry out the directions made above in

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accordance with law within a period of four months from the  date of this order and hand over possession of the plots to the  successful allottees.  

8.      All applications seeking interventions, impleadment as parties  and  special leave petitions filed by parties, who were not parties  before the High Court, are,  hereby, rejected.  

As a result of the discussion aforesaid, the appeals and  connected matters are disposed of by substituting/modifying above- mentioned directions for the directions contained in the impugned  order of the High Court.  

Keeping in view the peculiar circumstances  of the case,  we  make no order as to costs which shall be borne by the parties as  incurred by them.