http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 12  

CASE NO.: Appeal (civil)  940 of 2007

PETITIONER: M/s Popcorn Entertainment & Anr

RESPONDENT: City Industrial Development Corpn. & Anr

DATE OF JUDGMENT: 23/02/2007

BENCH: Dr. AR. Lakshmanan & Altamas Kabir

JUDGMENT: J U D G M E N T (Arising Out of SLP (C) NO. 11085 OF  2006) WITH  CIVIL APPEAL NO.      941       OF 2007 (Arising Out of SLP (C) NO. 11087 OF  2006) M/s Platinum Entertainment & Anr.                       .... Appellant(s)

                               Versus

City Industrial Development Corpn. & Anr.      ...Respondent(s) Dr. AR. Lakshmanan, J.

SLP (C) NO. 11085 OF  2006

Leave granted. The above appeal was filed against the final judgment  and order dated 30.06.2006 passed by the High Court of  Judicature at Bombay in W.P.No. 9467 of 2005  whereby the  High Court has rejected the writ petition filed by the  appellants by holding that the appellants have an equally  efficacious remedy of filing a civil suit and thus the writ  jurisdiction cannot be invoked.  BACKGROUND FACTS: The appellant made an application for allotment of a plot  on 18.05.2004 for construction of a multiplex at Kharghar  railway station.  The first respondent, The City Industrial  Development Corporation (in short, "CIDCO") asked the  appellants to pay an EMD of Rs. 20 lacs being 10% of the  tentative price of the plot in order to consider the application  of the appellant.  The appellant deposited the said amount of  EMD immediately.  CIDCO, vide its Board Resolution dated  03.06.2004, approved the allotment in favour of the appellant  considering the fact that there were no multiplex in the area  and the earlier effort of CIDCO to advertise for such plots had  met with no response.  CIDCO issued allotment letter in favour  of the appellant asking the appellant to pay Rs.1,80,00,000/-  lacs being the balance price of the plot.  The appellant made  two separate payments of Rs. 90 lacs each towards the  balance price of the plot on 16.08.2004 and 19.08.2004.  The  appellant paid a sum of Rs.20,00,600/- being the other  charges demanded by the respondent.  The appellant was  asked to pay a further sum of Rs.65,096/- which the appellant  paid immediately.  CIDCO unilaterally decided to ask the  appellants to pay a further sum of Rs.20 lacs by enhancing  the rate at which the plot was to be allotted to the appellant  from Rs.2500/- per sq. metre as demanded in the allotment  letter to Rs.2,750/- per sq. metre because the plot of the  appellant was on a 24 metre road.  The appellant on  17.11.2004 paid a further payment of Rs.20 lacs along with

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 12  

Rs.2,96,078/- plus Rs.4,957/- being the additional cost and  the other charges.  On 14.01.2005, the appellant paid a  further sum of Rs.19,828/- being the sum demanded by the  respondent.  The appellant on 17.01.2005 entered into an  agreement to lease with the respondent for the allotment of the  plot.  On 28.02.2005, CIDCO being the Development Authority  of the area issued commencement certificate to the appellant  permitting the appellant to start construction.  On  14.07.2005, the appellant received a show cause notice  seeking to cancel the allotment in favour of the appellant on  the ground that the allotment was void in view of Section 23 of  the Contract Act as being opposed to public policy.  The main  ground in the show cause notice was that the allotment was  without issuance of tender and was opposed to public policy.   On 27.07.2005, the appellant submitted a detailed reply to the  show cause notice.  On 16.12.2005, CIDCO issued an order  canceling the agreement to lease and sought to resume the  possession of the plot.  According to the appellant only the  appellant was singled out for cancellation whereas hundreds  of allotments made without issuance of tender were allowed to  remain which is also a matter of record.  In these facts, on  28.12.2005, the appellant approached the High Court by way  of writ petition against the said cancellation order dated  16.12.2005.  The writ petition was numbered as 9467 of 2005  on 02.01.2006 and the High Court granted stay of the order  dated 16.12.2005 and fixed the matter for further hearing on  04.01.2006.  The appellant, vide reference dated 08.03.2006 of  CIDCO, under the Right to Information Act, 2005 has asked  them to supply information regarding the allotments made by  Social Service Department without any advertisement i.e. by  considering individual applications.  On 16.03.2006, the appellants filed their rejoinder before  the High Court pointing out further information sought under  the Right to Information Act which clearly proved that the  allotment in favour of the appellant was completely in order  and was made in terms of the Land Pricing and Land Disposal  Policy and also that there was no loss caused to CIDCO in the  said allotments.  The appellant sought another information  from the CIDCO Authorities regarding methodology for  allotment of plots for service industries, warehousing,  multiplexes, etc.  Again on 04.04.2006, the appellant had  sought for further information in respect of 15 cases similar to  the case of the appellants regarding whether disposal was by  tender or without tender, whether the pricing policy was  adopted or not etc.  Further information was sought on  13.04.2006 regarding allotment of social facility plots during  April, 2003 to March, 2005.  CIDCO, vide their letter dated  13.04.2006, has informed the appellant that during April,  2003 to March, 2005, 27 plots were allotted for the opening of  schools, 9 plots were allotted for opening of colleges, 5 plots  were allotted to charitable and religious institutions, 9 plots  were allotted to cultural organizations, 2 plots was allotted for  sports and 13 plots were allotted for social welfare.  In all 65  plots were allotted under the category of social facility.  CIDCO  has also confirmed that all the allotments had been made  without issuance of tender and that all the abovementioned  allotments have been made as per Land Pricing and Land  Disposal Policy of CIDCO i.e. the same as was done in the case  of the appellant. None of these allotments have been cancelled  by CIDCO till date. In this view of the matter,  it is clear that  the entire basis for seeking to cancel the appellant’s plots is  illegal and the same cannot stand the test of judicial scrutiny. On 20.04.2006, the appellant filed an additional affidavit  before the High Court pointing out certain more information  sought by the appellant.  On 17.05.2006, the matter was listed

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 12  

before the High Court and was adjourned for 4 weeks to  examine the judgment passed by the High Court in the case of  Raja Bahadur Mills.   The matter was again listed on  30.06.2006 for hearing.  The matter was heard and dismissed  and the Court indicated that the detailed judgment would be  pronounced later.  At that stage, counsel for the appellants  made a specific prayer to grant interim protection to the  appellant for a period of 4 weeks to enable the appellant to  approach this Court, the said prayer was orally granted by the  High Court.  However, on 06.07.2006, the High Court, while  issuing a copy of the order on 06.07.2006, dismissed the writ  petition of the appellant on the ground of availability of  alternative remedy.  The High Court rejected the prayer for  interim protection to the appellant despite having granted it  orally.  Aggrieved by the said order, the appellants filed this  appeal by way of special leave petition before this Court. This Court on 24.07.2006 issued notice returnable within  6 weeks and also passed the following interim order: "The petitioners had the benefit of stay of dispossession.  There will be stay of dispossession pending further orders.  But the petitioners will be restrained from putting up any  construction until further orders."

SLP (C) NO. 11087 OF  2006

Leave granted. The above appeal was filed against the final judgment  and order dated 30.06.2006 passed by the High Court of  Judicature at Bombay in W.P.No. 9468 of 2005 whereby the  High Court rejected the writ petition on the ground that the  writ jurisdiction cannot be invoked when an equally efficacious  remedy of filing a civil suit is available.   BACKGROUND FACTS: The appellant made an application on 22.02.2004  requesting for allotment of plot reserved for multiplex.  On  8.6.2004, the appellants made a request for allotment of the  plot in Airoli for setting up multiplex-cum-auditorium-cum- entertainment centre.  CIDCO, in response to the said  application, requested the appellant to submit a detailed  project defining all built up activities.  The appellant  submitted the detailed project report.  CIDCO, by their letter of  intent, requested the appellant to pay an EMD of Rs.  20,77,000 within 15 days from the receipt of the letter  to  enable the Board to consider the allotment in favour of the  appellant.  The appellant accordingly made the EMD on  29.06.2004.  On 29.07.2004, CIDCO approved the allotment of  plot No.2, Sector 11, Airoli in favour of the appellant as  the  Board had not got any response for similar plots in public  tender.  The total lease premium in respect of the plot was  Rs.2,07,70,000/- and the appellants were directed to pay the  balance amount of Rs.1,86,93,000/- by 14.09.2004.  The  allotment was made in terms of the New Bombay Land  Disposal Rules, 1975 and also in terms of the Land Pricing  and Disposal Policy of CIDCO under which the land could be  allotted to any person by considering his individual application  at the reserved price fixed by CIDCO.  On 16.08.2004 and  13.09.2004, the appellants paid Rs.1,86,93,000/- as  demanded.  On 15.10.2004, CIDCO after inspection of the plot  issued a corrigendum asking the appellants to pay a further

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 12  

sum of Rs.53,236/- being the additional amount due to the  marginal increase in the demarcation of the plot.  The  appellant paid the balance amount of Rs.53,236/- thus  making a total payment of Rs.2,08,22,420/- being the full and  final payment in respect of allotment in favour of the appellant  as demanded by CIDCO.  An agreement to lease was entered  into with CIDCO in respect of the plot allotted to the appellant.   CIDCO, on 01.08.2005, issued a show cause notice to the  appellants regarding the plot at Airoli seeking to cancel the  agreement to lease executed in favour of the appellants.  The  appellant made a detailed reply to the show cause notice.  The  appellant also sought information from CIDCO under the  Right to Information Act on  21.12.2005/03.04.2006/04.04.2006/13.04.2006/20.04.2006  regarding allotment to various parties and the details thereon.   The appellant, on 28.10.2005, approached the High Court  against the cancellation order dated 18.12.2005.  The writ  petition was listed for hearing on 02.01.2006 and the High  Court granted stay of the operation of the order dated  18.12.2005.  Parties were asked to file their reply and  rejoinder etc. in the writ petition.  The matter was listed on  17.05.2006 for hearing and was adjourned by 4 weeks and  again listed before the High Court on 30.06.3006 for hearing  and the matter was heard and dismissed and the Court  indicated that the detailed judgment would be pronounced  later.  However, on 06.07.2006, the High Court dismissed the  writ petition of the appellant on the ground of availability of  alternative remedy and rejected the prayer for interim  protection to the appellant despite having granted it orally.  Aggrieved by the said order, the appellants preferred this  appeal by way of special leave petition in this Court. This Court on 24.07.2006 ordered stay of dis-possession  pending further orders.  In this Court, the appellant in  addition to the special leave petition also filed additional  affidavit and  the counter affidavit filed by  respondent No.1  before the High Court of Bombay as annexure-P17.  A counter affidavit in reply on behalf of respondent No.1  CIDCO was also filed in the special leave petition specifically  stating that in the present case the allotment was cancelled  having regard to Section 23 of the Indian Contract Act as the  subject allotment was illegal and that as regards the merits of  rival contentions,  a detailed affidavit was filed before the High  Court and for the sake of brevity a copy of the same was  annexed as Annexure-R1.  The appellant also filed a rejoinder  to the counter affidavit filed on behalf of respondent No.1. We heard the arguments of Mr. Vikas Singh, learned  senior counsel for the appellant and Mr. Altaf Ahmed, learned  senior counsel for the contesting respondent.  We have  carefully perused the entire pleadings, documents and  annexures filed along with the special leave petitions.  Mr. Vikas Singh, learned senior counsel took us through  the various pleadings and also other relevant records.  Mr.  Vikas Singh made the following submissions: 1. Maintainability of the writ petition: As regards non-maintainability of the writ petition, the  appellant relied upon the following decisions of this Court  wherein this Court has held that the writ petitions can be held  to be maintainable under certain circumstances: i.      Smt. Gunwant Kaur & Ors. vs. Municipal  Committee Bhatinda & Ors [1969 (3) SCC 769]. ii.     Century Spinning & Manufacturing Company  Ltd & Another vs. The Ulhasnagar Municipal  Council & Another (1970 (1) SCC 582). iii.    Dr. Bal Krishna Agarwal vs. State of U.P. & Ors.  (1995 (1) SCC 614)

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 12  

iv.     Whirlpool Corporation vs. Registrar of  Trademarks, Mumbai & Ors. (1998 (8) SCC 1) v.      Harbanslal Sahnia & Another vs. Indian Oil Ltd.  & Ors. (2003 (2) SCC 107) vi.     Corporation of the City of Bangalore vs.  Bangalore Stock Exchange (2003 (10) SCC 212) vii.    ABL International Ltd. & Another vs. Export  Credit Guarantee Corporation of India Ltd &  Ors. (2004 (3) SCC 553) viii.   Sanjana M. Wig (Ms.) vs. Hindustan Petroleum  Corporation Ltd. (2005 (8) SCC 242)

He invited our attention to the Whirlpool Corporation  case (supra) wherein this Court has held that there are three  clear-cut circumstances wherein a writ petition would be  maintainable even in a contractual matter.  Firstly, if the action of the respondent is illegal and  without jurisdiction,  Secondly, if the principles of natural justice have been  violated and  Thirdly, if the appellants’ fundamental rights have been  violated.  According to the learned senior counsel, all the three  principles as laid down in the case of Whirlpool Corporation  have been made out in the instant case because the action of  CIDCO is wholly without jurisdiction as it is seeking to resile  from a concluded contract contrary to the express terms of the  contract. Secondly, CIDCO, has violated the principles of  natural justice as an order affecting the right of the appellant  has been passed without giving an opportunity of hearing to  the appellant and thirdly, the appellants’ fundamental rights  as guaranteed under Article 14 of the Constitution of India  have been violated because similar allotments made without  calling for tenders are not sought to be cancelled and the  appellant is being singled out by CIDCO while seeking to  cancel the allotment in favour of the appellant.  According to the appellant  similar allotments as well as  the allotment of the appellant are valid allotments as the same  have been made in exercise of the statutory powers of CIDCO  under the New Bombay Land Disposal Regulation, 1975 in  terms of the Land Pricing and Land Disposal Policy and hence  all allotments being valid, there is no justification for CIDCO to  cancel the allotment of the appellant while not disturbing the  other allotments made in favour of the other parties.  Learned senior counsel invited our attention  to the  details of other allotments made without calling for tender  which are available at pages 177 and 187 of the SLP paper  book in SLP No. 11085 of 2006.  Thus it is submitted that the  High Court committed grave error in rejecting the petition filed  by the appellant as not maintainable.   Learned senior counsel made certain submissions in  regard to the show cause notice where according to him, there  is mention of a report submitted by one Dr. D.K. Shankaran,  the then Additional Chief Secretary of the Government of  Maharashtra.  It is submitted that the said report was made  behind the back of the appellant and without his knowledge  and that the said report is an ex-parte report and no benefit  can be taken of the same by CIDCO as the report is based  upon conjectures and surmises and there is no scientific basis  of the findings in the report.  He would also further submit  that the CIDCO in the final termination order dated  16.12.2005 did not rightly make a mention of Sankaran  Report because the same could not have been relied upon as  having been made without any legal sanctity.  He invited our attention to the recent pronouncement of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 12  

this Court in the case of Amey Cooperative Housing Society  Ltd. vs. Public Concern for Governance Trust, 2007(2)  SCALE 405. In that case,  the Advocate General of  Maharashtra submitted regarding the status of the Shankaran  Committee report that it was treated by the State Government  to be a preliminary report only and not conclusive and that in  the final cancellation order the only ground made was that the  allotment had been made without calling for tenders and  without resorting to the process of competitive bidding.  Much argument was also advanced in regard to the  allegations which have been made out in the counter affidavit  before the High Court and in this Court.  It is submitted that  they were not made party in the show cause notice and were  also not a part of the final order of cancellation which is  impugned by the appellant in these proceedings.  Mr. Vikas  Singh further invited our attention to a Constitution Bench  judgment of this Court in Mohinder Singh Gill vs. C.E.C,  New Delhi reported in 1978 (1) SCC 405 wherein this Court  held in para 8 that where an order is passed on certain  grounds, its validity must be judged by the reasons so  mentioned and cannot be supplemented by fresh reasons in  the shape of affidavit or otherwise.  It is also argued that the  said Constitution Bench judgment of this Court has been  followed in Union of India & Ors. vs. E.G. Nambudiri , 1991  (3) SCC 38, State Govt. Houseless Harijan Employees’ vs.  State of Karnataka & Ors. , 2001 (1) SCC 610, Pavanendra  Narayan Verma vs. Sanjay Gandhi PGI Medical Sciences &  Anr. , 2002 (1) SCC 520 and in Chandra Singh & Ors. vs.  State of Rajasthan & Anr. , 2003 (6) SCC 545.  Thus, the  learned senior submitted that the CIDCO is trying to go  beyond the terms of the show cause notice/final order of  cancellation when admittedly CIDCO has affirmed other  similar allotment and permitted them to continue construction  inspite of the allotment being made to the other parties  without inviting tenders.   Learned senior counsel further submitted that the  allotment made by CIDCO are governed by New Bombay  Disposal of Lands Regulations, 1975.  Chapter 4 of the said  Regulations provide for mode of disposal of the land.  Regulation 4 of Chapter 4 provides as under: "Manner of disposal of land:- The Corporation may dispose  plots of land by public auction or tender or by considering  individual applications as the Corporation may determine  from time to time."  

As per the Land Pricing and Land Disposal Policy of  CIDCO, CIDCO has been authorized to dispose of various  types of land as per the method of disposal prescribed under  column 3 of the said policy.  The method of disposal has been  prescribed broadly in the following manner:  1.      By Public Advertisement & at fixed rate 2.      By tender 3.      on request at fixed rate

The Land Pricing and Land Disposal Policy has in all 12  sub-headings like no.1 is residential, no.2 is commercial and  no.12 is public utility. In the said policy, making allotment for  multiplexes/auditorium/theatre complex to be developed in  the private sector is in clause 12 of the Chapter relating to  allotment for public utility. CIDCO in their affidavit have made  wrong statement on oath that the allotment is commercial  because clearly under the Land Pricing and Land Disposal  Policy such allotment is not commercial but is allotment for  public utility. CIDCO to that extent has committed perjury and  are liable as such for the same.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 12  

Thus, from a conjoint reading of the Regulation and the  Land Pricing and Land Disposal Policy of CIDCO, it is clear  that the allotment of land could be done by considering  individual application i.e. without inviting tenders. From the  Land Pricing and Land Disposal Policy it is also clear that  disposal of land under different category are to be considered  differently. In the case of allotment of land for  auditorium/multiplex, theatre complex to be developed in the  private sector, it is prescribed that the land is to be allotted at  reserved price and the method of disposal is on request at  fixed rate failing which by competitive bidding thus, in the  instant case there is no infirmity in the allotment because the  same has been made on request at fixed rate at the reserved  price. Such allotment is clearly permitted under Regulation  and prescribed as the manner of allotment under the Land  Pricing and Land Disposal Policy of CIDCO. Even CIDCO in  their affidavit filed in the case of Sanjay Damodar Surve vs.  State of Maharastra, being PIL No. 140/2004 as well as in  the case of K.Raheja, (PIL No.45879/2003, 7637/2004) have  stated on oath this very stand that they have the right to make  allotment by considering individual applications in terms of  the power vested on them under Regulation 4 of the New  Bombay Disposal of Lands Regulations, 1975 and it is not  understood why CIDCO is seeking to take a different stand in  this matter by singling out the appellant. Mr. Vikas Singh further submitted that the reference to a  judgment of this court in Hazi Mastan vs. Kerala Financial  Corporation reported in 1988 (1) SCC 166 is misconceived  because in the said case there were no statutory regulations  providing for the manner of disposal of land and secondly even  in that case the Court had approved the disposal of land by  considering individual application as being justified in the  facts and circumstances of that case.  Therefore, learned  senior counsel submitted that the reference to the said  judgment can be of no help to CIDCO to justify the  cancellation order.    Learned senior counsel further contended that this Court  in the case of Corporation of the City of Bangalore vs.  Bangalore Stock Exchange,  reported in 2003 (10) SCC 212  has held that even in the case wherein cancellation of a lease  was for a public purpose i.e. for a park and playground by a  resolution of the corporation of the city of Bangalore, the same  was set aside as there were no such rights reserved to the  corporation to cancel the lease under the lease agreement. The  appellant in the reply to show cause notice has also referred to  judgments in  Printers (Mysore) Ltd. vs. M.A. Rasheed &  Ors. , 2004 (4) SCC 460 and Chairman & MD.BPL. Ltd. vs.  S.P. Gururaja & Ors.,  2003 (8) SCC 567 wherein also the  allotment had been challenged on the ground that the same  had been made without inviting tenders and the High Court  had cancelled the allotment and this Court while reversing the  order has held that if the Regulations of the Corporation  empower the corporation to make allotment without inviting  tenders then such allotment was clearly valid and no challenge  to the same would be entertained on the ground that other  persons could have been interested in applying for the  allotment and that they had not been given opportunity to  apply for the same. Clearly in terms of the two judgments  referred to above, it could not be said that allotment made  without issuance of tenders per se can be said to be bad or  being opposed to public policy. Learned senior counsel for the appellants further  submitted that the impugned order violates the fundamental  rights as guaranteed under Article 14 of the Constitution  because in the  similar allotments wherein also Dr. D.K.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 12  

Shankaran had reported that the same had been done without  inviting tenders and  CIDCO has suffered huge losses running  into crores, CIDCO has taken no steps to cancel those  allotments and in fact construction on the said plots are  continuing without any objection from CIDCO.  Learned counsel for the appellant submitted that the  appellant is clearly entitled to the same treatment i.e. of being  allowed to take the advantage of allotment in his favour which  according to the appellant is in accordance with the  Regulations as well as Land Pricing and Land Disposal Policy  as done in the case of others and that the hostile  discrimination of singling out of the appellant in the matter  clearly violates the fundamental rights of the appellant.  In fact, learned counsel invited our attention to the  similar allotments referred to by Dr. D.K.Shankaran where  also huge losses have been reported by Dr. D.K. Shankaran  and which allotments are being permitted to continue as  under:-   1.      M/s K. Raheja whose allotment is in the  commercial category and where Shankaran had  reported Rs. 50 crores loss, 2.      M/s Shakti Commercial Premises where the  allotment is for the multiplex and the loss  reported by Dr. D.K. Shankaran is Rs. 35 crores, 3.      M/s Mohan Entertainment where the allotment  was also for the multiplex and the loss reported is  Rs.23 crores and, 4.      M/s Gurudev Industrial Premises Co-operative  where the allotment is for service industry/  warehousing and the loss reported is Rs.63.55  crores, are some of such allotments which have  been allowed to continue and no steps for  cancellation of those allotments are being done by  CIDCO as is being done in the instant case of the  appellants. Furthermore, CIDCO is taking no  action for cancellation of other allotments made  by CIDCO without inviting tenders. It is submitted that the impugned order cannot be  sustained also on the ground that there is gross violation of  the principles of natural justice in the order. The first violation  of natural justice took place when Dr. D.K. Shankaran started  his enquiry. Dr. Shankaran conducted the enquiry without  notice to the appellant and without hearing the appellant. The  appellant while submitting their reply to the show cause notice  specifically sought for an opportunity of hearing, the same was  also not granted to the appellant before passing of the final  order and on this ground also the impugned order is liable to  be set aside. The appellant was not even given the copy of Dr.  D.K. Shankaran report for effective reply of show cause notice. The impugned order is also liable to be quashed as the  same is wholly without jurisdiction. Once a concluded contract  has been entered into between the parties, the parties cannot  be permitted to resile from the same contrary to the express  terms of the concluded contract. It has been held in the case  of   Corporation of the City of Bangalore’s case (supra) to  the effect that CIDCO has no such right to revoke the  concluded agreement and hence any action taken by CIDCO  contrary to the express terms of the agreement is wholly  without jurisdiction. CIDCO cannot take recourse of  Section  23 of the Contract Act alleging that the agreement is opposed  to public policy because clearly such right is reserved only to  the Courts and it is submitted that authorities themselves  cannot take recourse to the said section in order to annul a  concluded agreement. As regards the allegations made against Shri V.M. Lal,

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 12  

the then MD, CIDCO questioning the allotment in the counter  affidavit, it is submitted that firstly the entire basis of such  allegation does not survive because this Court has already  expunged all the remarks against Shri V.M. Lal in regard to  similar allotment made without issuance of tender during his  tenure and the Anti Corruption Bureau of the State of  Maharashtra as well as the State of Maharashtra in  disciplinary proceedings initiated against Shri V.M. Lal as ge  has also been given clean chit  with regard to all allotments  made by CIDCO during his tenure as CMD of the Board.  It is  also further contended that it was wrongly suggested by  CIDCO that the appellant was not eligible for such allotment  because the only criteria of eligibility in such allotment by  CIDCO is the submission of the EMD and no other criteria is  being taken into consideration before making such allotments.   The appellant had also submitted the project report and upon  being asked by CIDCO regarding the financial capabilities and  expertise of the appellant, the appellant had on 26.05.2004,  which was received by CIDCO office on 27.05.2004, submitted  a clarificatory letter stating about their experience in the field  of construction industry for several years.  The appellant had  also expressed their willingness to approach technical experts  from Multiplex industry to provide the area of Navi Mumbai  with excellent entertainment facility.  In the said letter they  had also stated about their financial standing and had  attached a letter from the bank regarding their financial  capability and that the Bank also gave a letter dated  27.05.2004 certifying the financial standing of the appellant.  At the time of hearing, it was suggested by learned senior  counsel for the respondent that the allotment was made  without any justification and that there was a huge demand  for such plot, it is submitted by learned counsel for the  appellant that the appellant has sought information from  CIDCO under the Right to Information Act as to whether there  was no application pending with them for allotment of the said  plot prior in time to the application of the appellant.  CIDCO in  reply has clearly stated that there was no application prior to  the application to the appellant.  Even the allotment in favour  of the appellant was a reasoned allotment taking into  consideration the lack of entertainment facilities in the area  and the said issue was also discussed in the board meeting  before the allotment and these facts are clear from the  information provided to the appellant under the Right to  Information Act.  Our attention was also drawn to the noting  in the file while considering the case of the appellant and  before making the allotment that    i.      "There is no cinema/multiplex facility available  today for the residents of CBD Belapur, Kharghar  and Kalamboli residents. ii.     From accessibility and land use compatibility  point of view, plot no.1, Sector 2, Kharghar  admeasuring about 8000 sq. mtrs is an ideal  location for multiplex. iii.    This building will be visible from highway and will  add to the image of the city. iv.     Adjoining plot no.1 of sector 1 attached to railway  station admeasuring 5600 m2 (not demanded yet)  is earmarked for city mall."       It is also brought to our notice that in the Board’s  deliberation it was noted by the then Chairman Shri  Javed Khan that promoting a Multiplex near railway  station shall be adding value to the development of that  node and was needed in view of shortage of  entertainment facility in Navi Mumbai.  As regards the suggestion of irregularity in the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 12  

allotment in favour of the appellant is concerned it is  submitted that the Principal Secretary, Urban  Development, Government of Maharashtra was present  in the Board meeting in which decision was taken to allot  the subject plot in favour of the appellant and the  subsequent CMD also in his letter dated 09.03.2005 had  justified the allotment by saying that there was no  comparable data to fault the allotment on the ground  that CIDCO has suffered losses in the same.  It is also  pertinent to point out that Dr. Shankaran was also a  member of the Board of Directors of CIDCO in the year  1992-93 and during the said period CIDCO Board  approved the allotment in favour of a society without  issuing tender in which society Dr. Shankaran also  owned a flat.  Concluding his elaborate and lengthy  submissions, Mr. Vikas Singh submitted that the  allotment in favour of the appellant cannot be faulted  because the grounds made out in the show cause  notice/final order of cancellation are clearly not  sustainable in law and the cancellation order needs to be  quashed.  It is further submitted that the allotment in  favour of the appellant is completely legal and correct  and the same has been made after duly complying with  the Land Disposal and Land Pricing Policy and new  Bombay Land Disposal Regulations, 1975.  He would  therefore submit that the impugned order dated  16.12.2005 and show cause notice dated 14.07.2005 be  quashed and the respondents are directed to permit the  appellant to go ahead with the construction of multiplex  in terms of the lease agreement executed between the  appellant and the CIDCO and also in terms of the  commencement certificate issued by CIDCO in favour of  the appellant.  Same argument was advanced by learned senior  counsel in the other civil appeal arising out of SLP (C) No.  11087 of 2006 filed by M/s Platinum Entertainment &  Anr.   Mr. Altaf Ahmed, learned senior counsel appearing  for the contesting first respondent submitted that the  High Court in passing the impugned order rejecting the  writ petition filed by the appellant herein has done so  principally on the consideration that the appellants had  not availed of the available alternative efficacious remedy  and as such could not invoke writ jurisdiction of the High  Court to decide contractual matters on whatever ground.   He would further submit that on this premises the High  Court declined to exercise jurisdiction under Article 226  of the Constitution sought to be invoked by the appellant  herein.  Mr. Altaf Ahmed further submitted that this  Court in its decision in Kerala State Electricity Boad &  anr. vs. Kurien E. Kelathil & Ors., reported in AIR 2000  SC 2573 has categorically held that merely because a  Corporation/Electricity Board can be termed as a limb or  instrumentality of the Government and hence State  within the meaning of Article 12 of the Constitution of  India nonetheless in the matter of contract jurisdiction  under article 226 of the Constitution of India cannot be  invoked and that this view is also affirmed in decisions in  National Highways Authority of India vs. Ganga  Enterprises & anr. reported in 2003 (7) SCC 410 and  Rajureshwar Associates vs. State of Maharashtra &  Ors. ,  2004 (6) SCC 362.  Mr. Altaf Ahmed further submitted that in the  present case the allotment was cancelled having regard  to Section 23 of the Indian Contract Act as the subject

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 12  

allotment was illegal and that as regards the merits of  rival contentions a detailed affidavit was filed before the  High Court denying the contents of the special leave  petition and its accompaniments and list of dates which  are inconsistent with and contrary to what is stated  hereinabove and as if the same has been expressly  traversed and denied.  He would, therefore, submit that  the appeal is devoid of merits and hence deserves to be  dismissed at the threshold in the interest of justice and  prayed accordingly.  It was further submitted  that in  case this Court were to remit the matter back to the High  Court for fresh disposal,  the same writ petition be  restored to its original No. along with the pleadings which  were already complete with a direction to the High Court  to decide the same in a time-bound manner preferably  within a short period.   We have given our careful consideration to the rival  submissions made by the respective counsel appearing  on either side.  In our opinion, the High Court has  committed a grave mistake by relegating the appellant to  the alternative remedy when clearly in terms of the law  laid down by this Court,  this was a fit case in which the  High Court should have exercised its jurisdiction in order  to consider and grant relief to the respective parties.  In  our opinion, in the instant case, 3 of the 4 grounds on  which writ petitions can be entertained in contractual  matter were made out and hence it was completely wrong  by the High Court to dismiss the writ petitions.  In the  instant case, 3 grounds as referred to in Whirlpool  Corpn. (supra) has been made out and accordingly the  writ petition was clearly maintainable and the High Court  has committed an error in relegating the appellant to the  civil court.              It is also pertinent to notice when the allotment was  made in favour of the appellant there was no  entertainment facility available in the area and CIDCO in  its endeavour to do proper planned development of the  area was obliged to provide for entertainment for the  residents.  CIDCO in fact had put an advertisement for  tender for various other plots for the said purpose and  upon getting no response to the advertisement, CIDCO  approved the allotment in favour of the appellant on first  come first serve basis.  It is not the case of CIDCO or by  any other private party that any other application was  made prior in time to the application made by the  appellants for the same plot and hence the allotment in  favour of the appellant cannot be faulted in any manner.   It has been held by several decisions of this Court that  while developing a new township the objective of the  planning authorities is not to earn money but to provide  for systematic and all-round development of the area so  that the purpose of setting up the township is achieved  by more and more people wanting to live in the area in  view of the various amenities being provided in the area.   Considering this objective in mind, we are of the view  that the allotment made in favour of the appellants  cannot be faulted with and this Court will accordingly set  aside the orders of CIDCO seeking to resile from a  concluded contract in favour of the appellants. It is also pertinent to mention that CIDCO in the  show cause notice has taken the ground of non-issuance  of tender as the only basis for cancelling the allotment  and CIDCO in the final order has also confined itself to  the non-issuance of tender as the ground for cancellation  but in the reply to the writ petition, CIDCO is seeking to

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 12  

add further grounds to justify the order of cancellation,  which is clearly not permissible in terms of the law laid  down by this Court in several of its decisions.  Learned counsel for the appellant submitted that  since all the pleadings, records, annexures filed before  the High Court and also of this Court is available before  this Court, this Court may dispose of the same on merits  without remitting the matter to the High Court for fresh  disposal as suggested by learned senior counsel for  respondent No.1.  It is true that all the records,  documents, annexures are available before us. At the  same time, the High Court had no occasion to consider  all these rival submissions and to render a categorical  finding on all the issues.  The High Court has disposed of  the writ petition only on the ground of availability of  alternative remedy.  The High Court has not recorded its  finding on the merits of the rival claim.  Since elaborate  arguments were advanced by learned senior counsel for  the appellant and countered by learned senior counsel  for the respondent, we extracted the entire argument in  extenso in order to enable the High Court to consider all  the above submissions made by both the parties on  merits and dispose of the same within a period of 6  weeks from the date of receipt of this judgment.  As  already noticed the request for allotment of construction  of multiplex was made on 18.05.2004 and the allotment  was made by the Board’s Resolution dated 03.06.2004.   It is also a matter of record that both the appellants in  the civil appeals have deposited several crores of rupees  as and when directed by respondent No.1.  It is also  pertinent to notice that commencement certificate to the  appellants permitting them to start the construction was  also made on 28.02.2005.  However, the show cause  notice was issued in July, 2005 and the allotment was  cancelled subsequently which was challenged in the writ  petition in the year 2006.   Since the matter is pending for a very long time  before the High Court and also of this Court, we feel just  and proper to request the High Court to restore both the  writ petitions No. 9467/2005 and 9468/2005 to its  original No. along with the pleadings which were already  complete and request the High Court to decide the same  in a time bound manner preferably and on priority basis  within 6 weeks from the date of receipt of this judgment.     We make it clear that we have only extracted and  reproduced the extensive arguments advanced by learned  senior counsel appearing on either side which, in our  opinion, would facilitate the High Court to decide the  matter afresh on merits.  While admitting the special  leave petition, this Court on 24.07.2006 granted stay of  dispossession pending further orders and also restrained  the appellants from putting up any construction until  further orders.  The said order will be in force till the  disposal of the writ petitions by the High Court.  The  Hon’ble Chief Justice of the High Court is requested to  place the matter before a Division Bench for disposal of  the same afresh on merits within 6 weeks from the date  of the receipt of this judgment.  This direction for early  disposal is issued in the peculiar facts and  circumstances of the case and in public interest. Accordingly, the appeal is disposed of.   No costs.