http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 7  

CASE NO.: Appeal (civil)  5874 of 2007

PETITIONER: Poonam Verma & Ors.

RESPONDENT: Delhi Development Authority

DATE OF JUDGMENT: 13/12/2007

BENCH: S.B. Sinha & Harjit Singh Bedi

JUDGMENT: J U D G M E N T  [Arising out of  SLP (Civil) No. 1322 of 2007] S.B. SINHA, J :          1.      Leave granted.

2.      Respondent is an authority created under the Delhi Development Act,  1957 (for short \023the Act\024).  The Act was enacted to provide for the  development of Delhi according to plan and for matters connected therewith  or ancillary thereto.           Respondent floated a scheme known as Fifth Self Financing Housing  Registration Scheme, 1982 (for short \023the Scheme\024).  Appellants herein  pursuant to an advertisement issued in this behalf registered themselves;  their registration numbers being 13463, 16602 and 13464.  For the purpose  of allotment of flats, lots were drawn on various occasions, viz., in June,  1987, November, 1987, March, 1989, July, 1990, January, 1991, January,  1993.  Appellants were not successful therein and, thus, were unable to get  flats in locality of their choice.  The Scheme was closed.  However, with a  view to give a chance to those who were not successful in the lots on the  earlier occasions, a public notice was issued in some newspapers on  8.12.1993 for release of about 3000 flats which included some built and  ready-built ones situated in Kondli-Gharoli.  Registrants under the Scheme  were entitled to apply therefor.  In the public notice, it was categorically  stated that the registrants of the said scheme who had not applied for an  allotment in that release would not be eligible to apply again for allotment.   It was further stated that in the case registrants of 5th SFS did not avail of  this opportunity or if they surrendered allotment/ allocation after being  successful, they shall be deemed to have opted out of the scheme and action  shall be taken to refund their registration money.  3.     Appellants did not respond to the said notice.  Despite the same  allegedly they had been allotted Category- III flats.  They were called upon  to pay the price specified therefor and to take delivery thereof.  They  declined to do so.  They asked their names to be included in the VI and VI-A  Self Financing Schemes which were issued later on.  Respondent did not  agree thereto. 4.      A complaint was filed by the appellants before the Consumer Disputes  Redressal District Forum \026 II on or about 16.01.1995 inter alia for a  direction upon the respondent herein that their registration should not be  cancelled and they should be considered in future draw of lots till they could  be allotted flats in the locality of their choice.  By a judgment and order  dated 24.07.1995, the said application was allowed holding that the action of  the respondent in not considering the cases of the appellants for allotment  through the process of draw of lots amounted to unfair trade practice, apart  from being unilateral and unjustified.  Aggrieved by and dissatisfied  therewith, the respondent preferred an appeal before the State Consumer  Disputes Redressal Commission, New Delhi and by an order dated  30.11.1998 allowed the said appeal and set aside the order of the District  Forum.  Appellants herein thereafter filed a revision application before the  National Consumer Disputes Redressal Commission.  During pendency of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 7  

the said application, they approached the Finance Member and Chairman of  the respondent to place their case before the \021out of court settlement  committee\022.  By an order dated 25.11.1999, the National Commission  dismissed the revision petition filed by the appellants herein relying inter  alia on Clause 16 of the Brochure wherein it had categorically been stated  that \023DDA reserves the right to withdraw the Scheme at any time\024.  A  Special Leave Petition preferred thereagainst was dismissed.   5.      Although the appellants were not successful in their attempt to obtain  any remedy on the judicial side, they purported to approach the Ministry of  Urban Affairs in 1997.  They made certain representations.  Allegedly, the  Joint Secretary (D&L) by reason of a letter dated 24.08.2000 addressed to  the Vice-Chairman of Delhi Development Authority directed as under:

\023I am directed to refer to D.O. letter No. F.1  (Misc.) 5th SFS & onwards/2000/SFS, dated the  15th May, 2000 from Shri Arvind Kumar, the  then Commissioner (Housing), on the subject  noted above, and to state that the matter  pertaining to giving one more opportunity to the  left out registrants of 5th and subsequent Self  Financing Schemes was discussed in the  Chamber of UDM with VC, DDA some time  back.  After discussion, it was agreed that instead  of a general scheme, VC, DDA would cover the  pending petitioners, especially, the hard cases  under the OTA quota.  It was also mentioned by  the VC, DDA that there are only three such  cases.  It is, therefore, requested that further  action to allot the flats to these three petitioners  may please be taken and action taken in the  matter may be intimated to this Ministry in due  course.\024

6.      The State Consumer Disputes Redressal Commission was again  approached.  The application of the appellants was dismissed.  Another  application was filed by them before the Permanent Lok Adalat for non- compliance of orders of Ministry of Urban Development despite availability  of flats.  By an order dated 6.09.2005, the Lok Adalat observed:

\023On 12.4.2005, Lok Adalat had recommended that  the case of the petitioner is a hard case and instead  of General Scheme the case of the petitioner  should be considered under the Out of Turn  Allotment quota particularly when there are only  three cases left.  In this connection a letter of  Minister of Urban Development & Poverty  Alleviation dated 24.8.2005 refers to.  This letter  clearly provides that according to the Vice- Chairman, DDA there are only three such cases  left and in such a situation the case of the  petitioner should be covered under OTA Quota  being a hard case.  This recommendation has not  been accepted by the DDA presumably for the  reason that the scheme of SFS under which the  petitioner had applied had become defunct.  The  scheme of OTA under the quota is also no longer  in existence and as such the case of the petitioner  cannot be considered under this category.  The  petitioner cannot be considered under this  category.  The petitioner cannot be allotted a flat as  the flats which are lying vacant for which the  petitioner has applied for the DDA has merged the  flats with the Higher Income Group.  In other  words, the DDA in the aforesaid circumstances has  opposed such allotment to the petitioner.  There is

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 7  

no meeting ground between the parties, the matter  is closed as unsettled.  The petitioner is at liberty  to approach appropriate Forum/ Court of Law for  redressal of his grievances if she is so advised.\024

7.      Thereafter, a writ petition was filed before the Delhi High Court  which was marked as Civil Writ No. 19633-35 of 2005.  By an order dated  20.03.2006, the said petition was dismissed.  Letters Patent Appeal preferred  thereagainst by the appellants being LPA No. 652-654 of 2006 has also been  dismissed by reason of the impugned judgment dated 25.04.2006.  A review  application filed thereagainst also stand dismissed.   

8.      Mr. Ram Prakash, representing the appellants, in support of this  appeal inter alia  would submit: (i)     As in the Brochure, a policy of reservation was provided, the High  Court committed a serious illegality in opining that no legal right  accrued in their favour in terms of the said letter dated 24.08.2000. (ii)    The Central Government, having regard to Section 41 read with  Section 56(2)(r) of the Act, could direct allotment of flats from  \021out of turn quota\022 keeping in view the cases of the appellants who  were three in number, as falling in the category of hard cases. (iii)   The Central Government in a situation of this nature was entitled  to formulate a Scheme for the left out registrants.  The authorities  of the respondent having participated in the meeting with the  Minister of Urban Development, pursuant whereto the said letter  dated 24.08.2000 was issued, the respondent was bound to  implement the same in view of the principles of Legitimate  Expectation and Promissory Estoppel. (iv)    As a large number of flats had been vacant, as would appear from  the statement made by the Vice-Chairman of the respondent on  8.11.2002 by reason of allotment of the flats, nobody else would be  prejudiced. 9.      Mr. Ashwani Kumar, learned counsel appearing on behalf of the  respondent, on the other hand, submitted: (i)     Appellant do not have any legal right in obtaining allotment of  flats. (ii)    They having failed to deposit the amount as far back in 1994  cannot now be permitted to claim an equitable right despite their  unsuccessful attempt before the Forums created under the  Consumer Protection Act, 1985. 10.     Indisputably, the Scheme was an independent one.  It was a Self  Financing Housing Registration Scheme.  Other similar schemes following  the same were also wholly independent of each other.  The Brochure issued  for enforcing the said Scheme is a self-contained document.  It provides for  the mode and manner in which flats are to be allotted, the categories of the  allotment of flats thereof, mode of payment as also cancellation thereof.   Indisputably, despite the fact that the appellants were not successful in  obtaining the flats by reason of draw of lots and despite the fact that they did  not respond to the notice issued by the respondent, those cases had not been  considered in the year 1994.  On what ground, we do not know, flats were  allotted in their favour.  They were asked to make deposits.  They did not do  so.  They, on the other hand, made a totally untenable claim of continuing  their registration again in VI and VI-A Schemes. 11.     We have noticed hereinbefore that their claim based on deficiency of  service and/ or unfair trade practice was rejected by the Higher Forum on the  part of the respondent.  They lost their battle upto this Court in the first  round of litigation.   12.     Having failed to establish any legal right in themselves as also  purported deficiency in services on the part of the respondent before  competent legal forums, they took recourse to remedies on administrative  side which stricto sensu were not available.  It has not been shown as to on  what premise the Central Government can interfere with the day to day  affairs of the respondent.  Section 41 of the Act, only envisages that the  respondent would carry out such directions that may be issued by the Central  Government from time to time for the efficient administration of the Act.  

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 7  

The same does not take within its fold an order which can be passed by the  Central Government in the matter of allotment of flats by the Authority.   Section 41 speaks about policy decision.  Any direction issued must have a  nexus with the efficient administration of the Act.  It has nothing to do with  carrying out of the plans of the authority in respect of a particular scheme.   

13.     The Central Government does not have any quota under the Act.  It  did not have any quota under the Scheme.  The reservations envisaged in  terms of the Scheme were as under: \023a)  25% of the flats for the persons belonging to  SC/ST. b)      3% of the flats for MPs. c)      2% of the flats for persons who have won  national recognition in the field of sports, art and  music. d)      1% of the flats for physically handicapped.\024

14.     Evidently, the Central Government had no say in the matter either on  its own or under the Act.  In terms of the Brochure, Section 41 of the Act  does not clothe any jurisdiction upon the Central Government to issue such a  direction. 15.     Submission of Mr. Ram Prakash that the Central Government could  issue the said direction in exercise of its rule making power under Section 56  of the Act is wholly misplaced.  In issuing the said letter, the Central  Government did not exercise its legislative power nor could it do so.  The  Central Government in terms of the Act apart from Section 41 did not have  any power and, thus, could not have issue any direction in terms thereof.  16.     If Section 41 of the Act or for that matter Section 56(2)(r) thereof  were not applicable, the question of issuing any direction purported to be in  terms of Section 21 of the General Clauses Act, as has been submitted by  Mr. Ram Prakash, did not arise. 17.     M.P. Gangadharan and Others v. State of Kerala and Others [(2006) 6  SCC 162], whereupon reliance has been placed by Mr. Ram Prakash, has no  application in the instant case.  18.    The Scheme in question was closed as far back as in the year 1994.   The Central Government in terms of the provisions of the Act or otherwise  had no jurisdiction to revive the same. 19.     All the authorities under the Act including the Central Government  being the creature of statute were bound to act within the four corners  thereof.  A specific grievance was raised by the appellants herein that the  action on the part of the authority amounted to unfair trade practice.   Deficiency of service was also pleaded.  The same had been negatived.  The  courts having appropriate jurisdiction having found neither unfair trade  practice nor there being deficiency in service and in that view of the matter,  the Central Government ordinarily ought not to have interfered in the matter. 20.     The purported letter dated 24.08.2000 does not specify as to how the  Central Government assumed any jurisdiction in the matter. 21.     Some officers of the respondent by themselves could not have evolved  a Scheme which was beyond the purview and scope of the Act.  Respondent  being a State within the meaning of Article 12 of the Constitution of India is  bound to fulfill the constitutional scheme contained in Article 14 thereof.  It  could not, going behind the professed scheme as contained in the Brochure,  create a quota.  Such a purported decision being wholly without jurisdiction,  is a nullity.  The Central Government itself directed the authority to confine  the \021out of turn allotment\022 quota by reason of a direction issued in June,  2000 only for widows of: (a)     Government servants who dies in harness. (b)     Those who were killed by terrorists.         It would be preposterous to suggest that the Central Government  could act beyond its professed policy decision. 22.     The Central Government, thus, acted illegally and without jurisdiction  in purporting to take a decision that the hard cases may be brought within  the purview of the \021Out of Turn Allotment\022 Quota, as therefor there was no  legal sanction.           

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 7  

Justice Frankfurter in Vitarelli v. Seaton [359 US 535] stated:

\023An executive agency must be rigorously held to the standards  by which it professes its action to be judged\005\005   Accordingly,  if dismissal from employment is based on a defined procedure,  even though generous beyond the requirements that bind such  agency, that procedure must be scrupulously observed.   \005..This judicially evolved rule of administrative law is now  firmly established and, if I may add, rightly so.   He that takes  the procedural sword shall perish with the sword.\024

       [See also Ramana Dayaram Shetty v. The International Airport  Authority of India and Others AIR 1979 SC 1628 : (1979) 3 SCC 489, Harjit  Singh & Anr. v. The State of Punjab & Anr. 2007 (3) SCALE 553] ) 23.     Having professed to abide by the Brochure which contained the policy  of reservation, as noticed hereinbefore, the Central Government could not in  absence of any statutory provision directed creation of any quota and that  too after closure of the Scheme.  The Scheme after its closure could not even  have been revived.  24.    Guidelines per se do not partake to the character of statute.  Such  guidelines in absence of the statutory backdrop are advisory in nature.  Mr.  Ram Prakash himself has relied upon a decision of this Court in Narendra  Kumar Maheshwari v. Union of India and Others [AIR 1989 SC 2138]  wherein it has been laid down: \023100\005 This is because guidelines, by their very  nature, do not fall into the category of legislation,  direct, subordinate or ancillary. They have only an  advisory role to play and non-adherence to or  deviation from them is necessarily and implicitly  permissible if the circumstances of any particular  fact or law situation warrants the same. Judicial  control takes over only where the deviation either  involves arbitrariness or discrimination or is so  fundamental as to undermine a basic public  purpose which the guidelines and the statute under  which they are issued are intended to achieve.\024

[See also Narendra Kumar Maheshwari  v.   Union of India and others 1990  (Supp) SCC 440 at 508;  Maharao Sahib Shir Bhim Singhji  v.  Union of  India and others (1981) 1 SCC 166 at 232; J.R. Raghupathy and others  v.   State of A.P. and others (1988) 4 SCC 464 (paragraph 31); Uttam Parkash  Bansal and others  v. L.I.C. of India (2002) 100 DLT 487]         Guidelines being advisory in character per se do not confer any legal  right.   25.      Reliance has also been placed upon P.M. Ashwathanarayana Setty  and others v. State of Karnataka and others [AIR 1989 SC 100] for the  proposition that the State cannot rely on an evasive reason.  We fail to  understand how a case relating to Court Fees and Suit Evaluation Act, would  assist us in invoking the principles in regard to the discriminatory impact of  the matter in a case of this nature. 26.     Mr. Ram Prakash has also placed reliance upon State of Himachal  Pradesh and Another v. Kailash Chand Mahajan and Others [1992 Supp (2)  SCC 351] wherein this Court was considering the statutory conditions of  services framed under a regulation made in terms of Electricity (Supply)  Act.  In that context, this Court considered the question as to whether the  term of appointment can be confined to a single person.  Reliance placed on  the said decision is wholly misplaced.  A reasonable classification is  permissible although a class legislation is not, but the same will have no  application in a case where an executive order was passed wholly without  jurisdiction and contrary to the constitutional scheme relating to fixation of  quota for certain categories of persons. 27.     An endeavour has been made to invoke the principles of Legitimate  Expectation and Promissory Estoppel.  The doctrine of Legitimate  Expectation would apply only when a practice is found to be prevailing.  It

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 7  

has a positive concept.  But, in a case of this nature where purported  expectation is based on an illegal and unconstitutional order, the same is  wholly inapplicable, as the same cannot be founded on an order which is per  se illegal and without foundation.           Strong reliance has also been placed on a decision of this Court in  Ram Pravesh Singh and Others v. State of Bihar and Others [(2006) 8 SCC  381] wherein a Bench of this Court opined: \02315. What is legitimate expectation? Obviously, it  is not a legal right. It is an expectation of a benefit,  relief or remedy, that may ordinarily flow from a  promise or established practice. The term  \023established practice\024 refers to a regular,  consistent, predictable and certain conduct, process  or activity of the decision-making authority. The  expectation should be legitimate, that is,  reasonable, logical and valid. Any expectation  which is based on sporadic or casual or random  acts, or which is unreasonable, illogical or invalid  cannot be a legitimate expectation. Not being a  right, it is not enforceable as such. It is a concept  fashioned by the courts, for judicial review of  administrative action. It is procedural in character  based on the requirement of a higher degree of  fairness in administrative action, as a consequence  of the promise made, or practice established. In  short, a person can be said to have a \023legitimate  expectation\024 of a particular treatment, if any  representation or promise is made by an authority,  either expressly or impliedly, or if the regular and  consistent past practice of the authority gives room  for such expectation in the normal course. As a  ground for relief, the efficacy of the doctrine is  rather weak as its slot is just above \023fairness in  action\024 but far below \023promissory estoppel\024. It  may only entitle an expectant: ( a ) to an  opportunity to show cause before the expectation  is dashed; or ( b ) to an explanation as to the cause  for denial. In appropriate cases, the courts may  grant a direction requiring the authority to follow  the promised procedure or established practice. A  legitimate expectation, even when made out, does  not always entitle the expectant to a relief. Public  interest, change in policy, conduct of the expectant  or any other valid or bona fide reason given by the  decision-maker, may be sufficient to negative the  \023legitimate expectation\024. The doctrine of  legitimate expectation based on established  practice (as contrasted from legitimate expectation  based on a promise), can be invoked only by  someone who has dealings or transactions or  negotiations with an authority, on which such  established practice has a bearing, or by someone  who has a recognised legal relationship with the  authority\005\024

       The said decision, thus, instead of assisting the appellants runs counter  to their contention. 28.     Mr. Ram Prakash has also placed strong reliance on J.P. Bansal v.  State of Rajasthan [(2003) 5 SCC 134 : 2003 (3) SCALE 154].  Therein  itself, it is laid down:

\023\005The Constitution requires that action must be  taken by the authority concerned in the name of  the Governor. It is not till this formality is  observed that the action can be regarded as that of

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

the State. Constitutionally speaking, the Council of  Ministers are advisers and as the Head of the State,  the Governor is to act with the aid or advice of the  Council of Ministers. Therefore, till the advice is  accepted by the Governor, views of the Council of  Ministers do not get crystallised into action of the  State\005\024

29.     This decision is, therefore, an authority for the proposition that the  government order, so as to confer a legal right, must conform to the  provisions contained in Article 166 of the Constitution of India. 30.     Questioning the correctness of the observation of the Division bench  that the communication contained in the letter dated 24.08.2000 did not  confer any legal right, Mr. Ram Prakash, would submit that an  administrative order may also confer a legal right.  No doubt, it was so stated  in Union of India v. K.P. Joseph and others [(1973) 1 SCC 194 : AIR 1973  SC 303] but then it was a case where an executive order was passed which  was within the jurisdiction of the State in terms of the proviso appended to  Article 309 of the Constitution of India.  The Bench, it is interesting to note,  hastened to add: \02311. We should not be understood as laying down  any general proposition on this question. But we  think that the Order in question conferred upon the  first respondent the right to have his pay fixed in  the manner specified in the Order and that was part  of the conditions of his service. We see no reason  why the Court should not enforce that right.\024

31.     We, therefore, find no merit in this appeal which is dismissed  accordingly.  In the facts and circumstances of this case, however, there shall  be no order as to costs.