RIVIERA APARTMENTS P. LTD. v. LT. GOVERNOR OF DELHI
2006-11-15
MUKUL MUDGAL, S.MURALIDHAR
body2006
DigiLaw.ai
S. MURALIDHAR, J. ( 1 ) THIS writ petition, filed on 14. 7. 1994 by petitioner no. 1 a private limited company and petitioner No. 2 Shri Inder P Choudhrie, the managing Director of petitioner No. 2 seeks the following reliefs: (a) The quashing of a notice dated 29. 4. 1994 issued by the Under secretary, Urban Land Ceiling Cell, Land and Building Department, government of Delhi, respondent No. 6 herein, asking the petitioner No. 2 to show cause why the exemption order dated 26. 4. 1985 issued under Section 20 (1) (a), Urban Land (Ceiling and Regulation) act, 1976 ('ulcra') in respect of the vacant land to the extent of 368. 23 sq. m. in Plot No. 6, Tolstoy Marg, New Delhi owned by Shri K. Narendra should not be withdrawn on the ground that petitioner No. 2 had "failed to bring to the notice of the concerned authority the facts of condition No. 12 of the said exemption order at any stage"; for receiving compensation under the provisions of the Land Acquisition Act, 1894 (LA Act) "by suppressing the condition of the said exemption order" and on account of failure to observe the conditions of the said exemption order; (b) The quashing of a notice dated 4. 7. 1994 issued by the office of the deputy Commissioner, Delhi (Land Acquisition Branch), respondent No. 4 herein, asking the petitioner No. 2 to return the entire amount of Rs. 71,33,950 which was paid to him pursuant to the notices dated 5. 9. 1991 and 4. 10. 1991 respectively under Sections 4 and 6 of the LA Act on the ground that the petitioner No. 2 had suppressed the fact that the land which stood acquired pursuant to the above said notification was subject to an exemption order dated 26. 4. 1985 issued under the ULCRA; (c) The setting aside of Clause 12 of the exemption order dated 26. 4. 1985 issued under the ULCRA; and (d) A mandamus to the Respondents "to either release for construction purposes the area of land admeasuring 813. 34 square metres in the property apportioned/set aside without compensation for purposes of a primary school/road widening (being 967. 32 sq. m. originally apportioned/set aside less 153. 58 sq. m. acquired underthe LA Act) or in the alternative pay the petitioners market value for the same. " ( 2 ) BACKGROUND facts 2.
34 square metres in the property apportioned/set aside without compensation for purposes of a primary school/road widening (being 967. 32 sq. m. originally apportioned/set aside less 153. 58 sq. m. acquired underthe LA Act) or in the alternative pay the petitioners market value for the same. " ( 2 ) BACKGROUND facts 2. 1 The facts leading to the filing of this petition may be first recounted. The property in question is a plot at 6, Tolstoy Marg, New Delhi (hereafter referred to as "the said property") in respect of which, pursuant to a public auction, a perpetual lease dated 29. 5. 1956 was executed by the President of India, as lessor, in the names of Shri Shiv Ram, Shri Mahashaya Krishna (the grand-father of Shri K. Narendra, the Applicant in CM 6361/1994) and Shri K. Narendra. Ultimately the said lease came to be mutated in the name of Shri K. Narendra. Clause 2 (13) of the lease, which is relevant to the case on hand, reads as under: "the lessee shall before any assignment or transfer of the said premises hereby demised or any part thereof obtain from the lessor or such officer or body as the lessor may authorise in this behalf approval in writing of the said assignment or transfer and all such assignees and transferees and the heirs of the lessee shall be bound by all covenants and conditions herein contained and be answerable in all respects therefor. " 2. 2 On 25. 7. 1972, Shri K. Narendra entered into an agreement with the petitioners herein, agreeing to sell/transfer all his rights, title and interest in the said property to the petitioners for the purpose of the construction of a multi-storeyed building by the petitioners on the said property. In terms of the agreement, the total consideration was Rs. 8,97,740 out of which a sum of Rs. 50,000 was paid to Shri k. Narendra on the execution of the agreement. Another sum of Rs. 2,75,000 was paid by a post-dated cheque dated 25. 1. 1973 to be encashed by Shri K. Narendra after the plans for the multi-storeyed building were cleared for construction by the new Delhi Municipal Council (NDMC) [respondent No. 8 herein] and the Land and Development Office (Landdo) or earlier by mutual agreement. It is not in dispute that this cheque was encashed even before the plans could be cleared.
1. 1973 to be encashed by Shri K. Narendra after the plans for the multi-storeyed building were cleared for construction by the new Delhi Municipal Council (NDMC) [respondent No. 8 herein] and the Land and Development Office (Landdo) or earlier by mutual agreement. It is not in dispute that this cheque was encashed even before the plans could be cleared. The balance amount of Rs. 5,72,740 was to be paid after the completion of the said multi-storeyed building. However, by a supplementary agreement dated 26. 7. 1972 the parties agreed that instead of the balance consideration of Rs. 5,72,740 being paid in cash, the petitioners would give Shri K. Narendra flats on the 2nd, 3rd and 4th floors measuring 8182 sq. ft. , the area could be reduced or increased by 5 to 6 per cent at the discretion of the petitioners. 2. 3 The clauses of the agreement, material for the purpose of this petition, are as under: " (3) That the purchaser shall get the permission for such a conveyance from the Land and Development Officer and shall pay all the charges and expenses whatsoever, for execution and registration of the sale deed, its stamping and the charges to the Land and Development Officer on account of unearned increase payable by the seller for getting the necessary permission as provided in the perpetual lease dated 11. 9. 1961. (6) That only after the payment of the consideration in full to the seller the purchasers shall be entitled to convey, sell or transfer the flats and the plot of land bearing No. 6, Tolstoy Marg, New Delh. (7) That the vacant physical possession of the premises is hereby given to the purchaser who will nowforth be in actual possession of the premises. (8) That the purchaser shall be at liberty to store their construction materials, make storage-sheds, keep chowkidars and make room for them in the rear of Bungalow No. 6, Tolstoy Marg, New Delhi at their own cost without any let or hindrance from the seller or anyone claiming through or under him provided as specifically agreed that in case the post-dated cheque for Rs. 2,75,000 stated above, is not honoured by the bankers, the possession shall immediately be returned to the seller.
2,75,000 stated above, is not honoured by the bankers, the possession shall immediately be returned to the seller. (9) That the seller shall execute an irrevocable power of attorney in favour of the purchasers authorising them to do all the every act for constructing the said building on this land. (13) That in the event the Government of India acquired or requisitioned whole or part of the property or prohibits the transfer of the said property under any Urban Property Ceiling Law enforced before the date of sanction of the plans for the construction of the proposed multi-storey building, then in such even the Sellers shall refund the amount paid by the purchasers and the Purchasers shall simultaneously hand over the vacant and peaceful possession of the premises to the Sellers. Provided that in the event any such laws are promulgated after the sanction of the plans, than the rights of the sellers shall rest in the hands of the Purchasers and this agreement shall stand intact. " 2. 4 Shri K. Narendra executed an irrevocable registered power of attorney on 26. 7. 1972 in favour of Petitioner No. 2 and Ms. Minakshi Choudhary, Director of the petitioner No. 1 authorising them to represent him before NDMC and Landdo, and any other Government department or authority in connection with the construction of the multi-storeyed building. Significantly, the power of attorney did not contain a clause permitting the attorney holders to receive any land acquisition compensation in respect of the said property. 2. 5 The plans submitted by the petitioners for the multi-storeyed housing project by the name of "girnar" were rejected on 6. 11. 1972 on the ground that the plot in question formed a part of the zone marked as redevelopment area as per zonal Plan D-3. Meanwhile, the Government of India through the Landdo issued a notice to the petitioners asking them to show cause why the lease should not be cancelled since Shri K. Narendra had sought to sell the property to the petitioners, in breach of the lease condition, without obtaining the prior approval of the lessor. Replying to this show cause notice, the petitioners on 9. 11. 1972 informed the landdo that "there has been no assignment or transfer of the said property from Shri k Narendra who is the lessee as per your records.
Replying to this show cause notice, the petitioners on 9. 11. 1972 informed the landdo that "there has been no assignment or transfer of the said property from Shri k Narendra who is the lessee as per your records. It is a mere agreement to sell authorizing us to build and sell that property. You will, therefore, kindly see that the premises has not been sold to us and that there has been no breach under Clause 2 (13) of the lease deed. " 2. 6 By 1979, the plans submitted by the petitioners had been rejected several times for one reason or the other. In the circumstances, Shri K. Narendra, on 3. 5. 1979, filed a suit seeking a declaration that the agreement dated 25. 7. 1972 had become null and void and impossible of performance and a decree for delivery of possession of a portion of the land measuring about 45 sq. yards shown in the plan attached with the plaint. On 14. 3. 1980, the petitioners filed a suit against Shri K. Narendra seeking specific performance of the contract for sale, a mandatory injunction directing him to hand over vacant possession of the premises/part of the said property and in the alternative to grant a decree for the refund of Rs. 3,25,000 with interest calculated @ 18% p. a. and a decree for compensation. 2. 7 While these two suits were pending, the petitioners' application on behalf of Shri K. Narendra in their capacity as his power of attorney for exemption under section 20 (1) (a) ULCRA was being processed. An order dated 26. 4. 1985 was made by the Land and Building Department, Urban Land Ceiling Cell, exempting from the application of ULCRA excess vacant land to the extent of 368. 23 square metres in the said property. There were 13 clauses in the said exemption order that were required to be complied with for availing of the exemption. Clauses 9, 12 and 14 read as under: 9. No transfer/substitution of a dwelling unit shall be effected without obtaining prior approval of the Administrator of Delh.
23 square metres in the said property. There were 13 clauses in the said exemption order that were required to be complied with for availing of the exemption. Clauses 9, 12 and 14 read as under: 9. No transfer/substitution of a dwelling unit shall be effected without obtaining prior approval of the Administrator of Delh. For this purpose a list of intending buyers along with copies of the agreements executed or intended to be executed with the intending buyers and affidavits individually from them to the effect that he/she does not own any dwelling unit in any group housing scheme or a residential property or a house site or has a share in any joint ancestral property exceeding 80 sq. yd. , either in his/her name or in the name of unmarried minor children in the Union Territory of Delhi shall be filed with the Secretary (Landb), delhi Administration, Delhi "12. Such area of the plot as is required for the widening of the road, laying of Sewers or for any other public purpose by the DDA or any other shall not be built upon. Whenever such land is required for any of the aforesaid purpose, it would be surrendered to the Government on payment of the amount as may be determined under the Urban Land (Ceiling and Regulation) Act, 1976. " "14. If at any time the Administrator of Delhi is satisfied that any of the above conditions is not complied with by exemptee, it shall be competent forthe Administrator of Delhi to withdraw by order, such exemption after giving the reasonable opportunity to such person for making a represen- tation against the proposed withdrawal. " a copy of this Order was endorsed to petitioner No. 2 as attorney for Shri k. Narendra. 2. 8 By a common judgment dated 5. 12. 1990 a learned Single Judge of this court disposed of the two suits. While the petitioners' suit was decreed, the suit filed by Shri K. Narendra was dismissed. Shri K. Narendra then filed appeals before the Division Bench of this Court. 2. 9 While the appeals were pending, the Delhi Development Authority (DDA) [respondent No. 7 herein] vide its letter dated 3. 4.
While the petitioners' suit was decreed, the suit filed by Shri K. Narendra was dismissed. Shri K. Narendra then filed appeals before the Division Bench of this Court. 2. 9 While the appeals were pending, the Delhi Development Authority (DDA) [respondent No. 7 herein] vide its letter dated 3. 4. 1991 wrote to the NDMC that after construction of the proposed building on the said property certain development controls would be applicable and these were specified as under: " Set Backs Tolstoy Marg - 12mtrs. (40ft.) after road widening sides - 6 mts. (20ft.) on either side reara strip measuring (about 0. 08 hect. . e. 0. 2 acre) to a depth of 56' strip, a 50' set back is to be taken, out of which 40' is to be maintained as mandatory green. " 2. 10 It is stated that the petitioners submitted the building plans to the NDMC leaving vacant 967 sq. m. as against 368. 23 sq. m. assessed to be excess as per the ulcra. Further, the petitioners also left vacant as set back more than 12 feet of land in the said property. However, according to the NDMC, "the area for primary school facility is yet to be left/handed over". 2. 11 Ultimately, the plans were sanctioned by the NDMC on 4. 6. 1991 and the sanction was valid only up to 29. 4. 1993 subject to certain conditions. It appears this sanction was granted on account of the petitioners' suit having been decreed on 15. 12. 1990 containing a direction that Shri K. Narendra should obtain all necessary permissions from all authorities including revenue, local or central authorities so as to effectuate the agreement 2. 12 On 5. 9. 1991 the Government of the National Capital Territory of Delhi (GNCTD) [respondent No. 2 herein] issued a notification under Section 4 read with section 17 of the Land Acquisition Act, 1894 (LA Act) seeking to acquire on urgent basis 153. 98 sq. m. of land of the said property for the purpose of road widening on the request of NDMC. An award was made on 28. 5. 1992 by the LAC in respect of this parcel of land and the compensation was determined Rs. 71,33,950 at the rate of Rs. 33,400 per sq. m. The only claimant in respect of the said property was petitioner No. 2. On 13. 4.
An award was made on 28. 5. 1992 by the LAC in respect of this parcel of land and the compensation was determined Rs. 71,33,950 at the rate of Rs. 33,400 per sq. m. The only claimant in respect of the said property was petitioner No. 2. On 13. 4. 1992 petitioner No. 2, Inder P Choudhrie, the Managing director of petitioner No. 1 submitted an affidavit holding himself out to be the owner of the said property. This affidavit will again be referred to in some detail later in this judgment. During the period 16. 4. 1992 to 7. 9. 1992 the said compensation amount was paid to Petitioner No. 2 on his furnishing indemnity bond and a surety bond. 2. 13 As regards the issue of specific performance of the agreement, the appeals filed by Shri K. Narendra were dismissed by a Division Bench of this Court by a judgement dated 18. 12. 1992 and Shri K. Narendra was directed to hand over physical possession of the said property to the petitioners. Shri K. Narendra then appealed to the Hon'ble Supreme Court. 2. 14 On 4. 2. 1993, Shri Anil Narendra son of Shri K. Narendra, filed Civil writ Petition No. 660 of 1993 in this Court for a direction that the land acquisition compensation of Rs. 71. 34 lakh should be paid to Shri K. Narendra, his son Shri anil Narendra and grandson Master Aditya Narendra and not to the petitioners herein. The principal contention was that the petitioners were not the owners of the said property which still stood in the name of Shri K. Narendra who, according to shri Anil Narendra, held it as the Kartha of the Hindu Undivided Family (HUF) of which Anil Narendra and Aditya Narendra were coparceners and therefore entitled to their respective shares. It was also claimed that Anil Narendra had filed a separate suit being Suit No. 3510 of 1991 in which a learned Single Judge had by an order dated 19. 11. 1991 directed status quo to be maintained with regard to possession of the said property. 2. 15 In the said Civil Writ Petition No. 660 of 1993, an interim order dated 6. 8.
11. 1991 directed status quo to be maintained with regard to possession of the said property. 2. 15 In the said Civil Writ Petition No. 660 of 1993, an interim order dated 6. 8. 1993 was passed by this Court directing that the reference application filed under Section 18 of LA Act could be heard by the Additional District Judge, but that the payment of the enhanced compensation amount, if any, ordered in those proceedings shall not be made to anyone till further orders. Interestingly, in its reply affidavit dated 5. 8. 1993 in Civil Writ Petition No. 660 of 1993, the Land acquisition Collector (LAC) took the stand that compensation had been rightly paid to the petitioners in their capacity as the power of attorney holders of Shri K. Narendra. It was stated: "since the owner never came to the Department, and the attorney did come, the Department rightly presumed that the Attorney had been sent by the owner. There was no reason for the Department to suspect any foul playing (sic ). " Also, among the documents mentioned in this affidavit as having been furnished to the LAC by the petitioners during the award proceedings, the document dated 26. 4. 1985 being the ULCRA exemption does not find a mention. ( 3 ) THE present petition 3. 1 The filing of Civil Writ Petition No. 660 of 1993 by Anil Narendra, to which the petitioners herein as well as the respondents were parties, perhaps alerted the authorities to the possibility that the payment to the petitioners of the compensation for the land acquired for road widening was erroneous. A notice dated 29. 4. 1994 was issued by the Under Secretary, Urban Land Ceiling Cell, Land and building Department, Government of Delhi, [respondent No. 6 herein] to petitioner no. 2 requiring him to show cause why the exemption order dated 26. 4. 1985 issued under Section 20 (1) (a), ULCRA should not be withdrawn. The stated ground was that petitioner No. 2 had "failed to bring to the notice of the concerned authority the facts of condition No. 12 of the said exemption order at any stage"; he had received compensation under the provisions of the LA Act "by suppressing the condition of the said exemption order" and on account of failure to observe the conditions of the said exemption order. Simultaneously, on 29. 4.
Simultaneously, on 29. 4. 1994, the commissioner of Excise was appointed as an Enquiry Officer to examine the circumstances under which the payment of compensation in the sum of over Rs. 71. 33 lakhs had been erroneously made to the petitioner No. 2. 3. 2 As far as the Land Acquisition Department was concerned, it was clear that the LAC had overlooked Clause 12 of the ULCRA exemption order dated 24. 6. 1985 whereunder the compensation for acquisition of land in the said property for road widening was payable only under the ULCRA. The rate of compensation payable under the ULCRA would have been as little as Rs. 10 per sq. m. Thus respondent No. 4, the Deputy Commissioner, Delhi (Land Acquisition Branch), issued the impugned show-cause notice dated 4. 7. 1994 asking the petitioner No. 2 to return the entire amount of Rs. 71,33,950 on the ground that the petitioner No. 2 had suppressed the fact that the land which stood acquired pursuant to the above said notification was subject to an exemption order dated 26. 4. 1985 issued under the ULCRA. 3. 3 Thereupon the present writ petition was filed seeking the reliefs set out in para 1 of this judgment. The petitioners also prayed for a stay of the recovery of the compensation amount. Independently, proceedings were initiated against the petitioners under the Punjab Land Revenue Act, 1887 for recovery of the amount in question. This prompted the petitioners to file a separate application in this writ petition seeking stay of the recovery of the said amount. 3. 4 In disposing of the said application, a Division Bench of this Court on 10. 1. 1995 passed a detailed order, the relevant portion of which reads as under: "in this petition for stay, learned Counsel for the petitioners has contended that the show cause notice dated 29. 4. 1994 insofar as it states that there was a suppression of facts on the part of the petitioners is concerned, the same is not correct in view of the certain letters said to have been addressed by the petitioners to the authorities. It is also contended before us that 157. 92 metres of land were taken for road widening and that land measuring 809. 60 square metres have been taken for the purpose of a primary school.
It is also contended before us that 157. 92 metres of land were taken for road widening and that land measuring 809. 60 square metres have been taken for the purpose of a primary school. It is argued that that was by virtue of the conditions laid down by the DDA in its proceedings dated 3. 4. 1991 under the Delhi development Act, wherein a condition was imposed while dealing with the rear portion of the plot that a strip measuring about 0. 08 hectare. e. 0. 2 acre to a depth of 56' is to be kept reserved for use as part of the primary-cum-nursery school. After reserving this strip, a 50' set back is to be taken, out of which 40' is to be maintained as mandatory green. In our view, the fact that an inquiry into the question of withdrawal of the exemption notification is pending does not, prima facie, come in the way of issuance of a notice for recovery of the amount under the Punjab Land revenue Act. The question of withdrawal of exemption is a larger question, than the question relating to the recovery of the amount of Rs. 71,33,950. According to the respondents, it is stated in the show cause notice that this amount was paid because of suppression of the facts by the petitioners, while in the counter the stand taken is that the amount was paid by mistake. But the fact remains that condition No. 12 of the exemption order dated 26. 4. 1985 clearly mentions that the compensation is to be paid under the Urban Ceiling Act. It is not in dispute that if the compensation were to be paid under that Act, the compensation would at the rate of Rs. 10 per square metre, but now compensation has been paid at Rs. 33,400 per square metre under the Land Acquisition Act. Whether it is by way of suppression of fact or by mistake, the fact remains that the payment was made outside the condition imposed in Clause 12 of the exemption order. A question also arises in the writ petition whether the petitioners can be permitted at this distance of time in 1994 to file a writ petition questioning condition No. 12 of the exemption order of 26. 4. 1985.
A question also arises in the writ petition whether the petitioners can be permitted at this distance of time in 1994 to file a writ petition questioning condition No. 12 of the exemption order of 26. 4. 1985. It will have to be considered whether the petitioners can be permitted to question one condition and have the benefit of the exemption order or they should be complied to totally ignore it, if their contention is to be accepted. The question whether the provisions of the Punjab Land revenue Act are applicable or not has also been raised before us with reference to Sections 97 and 98 of the said Act and has to be considered. Learned Counsel for the petitioners raises a point that though Clause 12 refers to provisions of the Urban Ceiling Act, it was still open to the authorities to invoke provisions of the Land Acquisition Act wherever the provision of Section 1794) was invoked, as in the present case. At the moment, we find, prima facie, that the amount has been paid to the petitioners totally contrary to the specific condition imposed in Clause 12 of the exemption order. We have considered whether the petitioners should be allowed to retain the sum of Rs. 71,33,950 pending disposal of the writ petition. Having considered the questions of law as well as equity arising in the case, we are of the view that the following order would meet the ends of justice and public interest. There shall be a stay of the impugned notice under the Punjab Land revenue Act subject to the condition that the petitioners shall deposit into this Court a sum of Rs. 35 lakh within 4 weeks from today and furnish bank guarantee for the balance of the demand to the satisfaction of the registrar of this Court within the same time frame. Thereafter, the C. M. be posted before us for directions as to investment. To be listed before the Registrar on 13. 2. 1995. Dast. " 3. 5 This Court on the same date,. e. 10. 1. 1995, issued rule DB. An application filed subsequently for modification of this order was treated as an application for review, and was rejected by an order dated 8. 2. 1995. However, the time for depositing the sum of Rs. 35 lakh and furnishing bank guarantee for the balance was extended by 6 weeks.
e. 10. 1. 1995, issued rule DB. An application filed subsequently for modification of this order was treated as an application for review, and was rejected by an order dated 8. 2. 1995. However, the time for depositing the sum of Rs. 35 lakh and furnishing bank guarantee for the balance was extended by 6 weeks. A Special Leave Petition field by the petitioners against the above order dated 10. 1. 1995 of this Court was dismissed by the Hon'ble supreme Court on 10. 3. 1995. 3. 6 To complete this part of the narrative, it may be mentioned that the petitioners complied with a part of the above interim order in that they furnished the bank guarantee in the sum of Rs. 36. 33 lakh on 16. 3. 1995. Of the Rs. 35 lakh required to be deposited by them, they paid Rs. 20 lakh by cheque and for the balance amount of Rs. 15 lakh, time was extended to this Court till 15. 5. 1995 by an order dated 28. 3. 1995. It appears that the said balance of Rs. 15 lakh were also paid by demand draft on 19. 5. 1995 and was directed by this Court to be kept in safe custody. By a further order dated 6. 9. 1996 the delay in making the balance payment of Rs. 15 lakh was condoned. It was further directed that "if the cheque for Rs. 20 lakh and the two pay orders are with the Registry, they will be encashed, if not already encashed. " The bank guarantee furnished on 16. 3. 1995 by the Punjab and sind Bank for the balance sum of Rs. 36,33,950 has been kept renewed from time to time and the last renewal is valid till 30. 1. 2007. Under the guarantee the Bank has undertaken to pay the aforesaid amount "on demand without any demur or any objection upon a direction or demand being received from this Hon'ble Court that the said amount has become finally payable by the Petitioner under a Judicial decision or decree as aforesaid. " ( 4 ) SUPREME Court judgment declining specific performance 4. 1 The appeals filed by Shri K. Narendra were disposed of by the Hon'ble supreme Court by its judgment dated 24. 5. 1999 in K. Narendra v. Riviera apartments (P) Ltd. , V (1999) SLT 457= (1999) 5 SCC 77 .
" ( 4 ) SUPREME Court judgment declining specific performance 4. 1 The appeals filed by Shri K. Narendra were disposed of by the Hon'ble supreme Court by its judgment dated 24. 5. 1999 in K. Narendra v. Riviera apartments (P) Ltd. , V (1999) SLT 457= (1999) 5 SCC 77 . Allowing the appeals, the Hon'ble Supreme Court set aside the judgments and decrees passed by the learned Single Judge and the Division Bench of this Court. Instead a consolidated decree was passed in both the suits in the following terms: (1) The petitioners' suit for specific performance of agreement to sell dated 25. 7. 1972 was dismissed; (2) Shri K. Narendra was directed to return the amount of consideration paid by the petitioners with interest @ 12% p. a. from the date of payment to Shri K. Narendra till the date of return by the Shri K. Narendra to the petitioners; (3) Shri K. Narendra was directed to pay an amount of Rs. 3,25,000 by way of compensation in lieu of specific performance to the petitioners with interest at 12% p. a. from the date of decree till realisation; (4) Possession over the part of the property admeasuring 45 sq. yards (approximately) shown in red in the plan attached with the plaint filed by Shri K. Narendra was to be delivered by the petitioners to shri K. Narendra by removing structures, if any, raised by the petitioners. 4. 2 On 7. 12. 2000, Shri K. Narendra filed a fresh application being C. M. 11559 of 2000 claiming that as a consequence of the said judgment of the Hon'ble supreme Court the entire amount of compensation became payable to him and that he should be transposed for the petitioners herein. On 27. 7. 2001 the petitioners filed a reply to this application opposing the prayer and maintaining that the petitioners were still entitled to the entire compensation. An additional affidavit was filed in December 2001 by the Land and Building department stating that the compensation computed in the award of the LAC was erroneous in that it was calculated on the basis of the average of residential plus commercial rates whereas the said property was still only residential.
An additional affidavit was filed in December 2001 by the Land and Building department stating that the compensation computed in the award of the LAC was erroneous in that it was calculated on the basis of the average of residential plus commercial rates whereas the said property was still only residential. Shri K. Narendra filed a rejoinder in CM 11559 of 2000 bringing on record documents that formed part of the connected civil Writ Petition 660 of 1993 in support of the plea that the compensation was payable only to him. ( 5 ) SUBMISSIONS of Counsel 5. 1 Mr. Prashant Bhushan, learned Counsel for the petitioners submits that the provisions of the LA Act had been rightly invoked by the respondents for acquiring the land for road widening. There was no mistake committed by the respondents as claimed by them despite the ULCRA order dated 26. 4. 1985. Further all these facts had been disclosed by the petitioners before the LAC. Therefore, the allegations that the petitioners had suppressed material facts was wholly untrue. He further submitted that having opted for the LA Act, the respondents cannot revert to the ULCRA. The precise contention in this regard in the written note of the petitioners reads as under: " (c) The contention of the respondent Nos. 1 to 6 that even if the land was acquired under the Land Acquisition Act the compensation could have been paid as per the ULCR is not correct. It is submitted that once the Government decides to acquire someone's land under a particular statute it is required to comply with all the provisions of that statute and cannot resort to some other law for a particular purpose like paying compensation. It is submitted as stated above that the Land and Building Department was aware about the exemption order and it was incumbent upon them to acquire the land as per the exemption order under ULCRA without resorting to land Acquisition Act. However, once they chose to exercise that option under the Land Acquisition Act they cannot revert back to ulcra for the purpose of praying compensation especially when the proceedings were over and the Award was passed which has finality as per Section 12 of the Land Acquisition Act. " 5.
However, once they chose to exercise that option under the Land Acquisition Act they cannot revert back to ulcra for the purpose of praying compensation especially when the proceedings were over and the Award was passed which has finality as per Section 12 of the Land Acquisition Act. " 5. 2 Developing upon the above point, the learned Counsel for the petitioner urged that there is no provision under the LA Act for recovering the amount of compensation already paid pursuant to an award except by resorting to Section 13 A which prescribes the procedure for correcting mistakes. However, even then the award could not be reopened after a period of 6 months and admittedly in the present case the demand notice was issued 2 years after the passing of the award. 5. 3 Relying on the decision of the Hon'ble Supreme Court in State of U. P. v. L. J. Johnson, AIR 1983 SC 1303 it is submitted that ULCRA does not envisage that any particular piece of land from the property can be declared as excess by the competent authority. The choice in this regard is usually that of the landholder. Reliance for this proposition is placed on two decisions of the Allahabad High court in M/s. M. S. Bansal Pvt. Ltd. v. District Judge Aligarh, 1986 All. L. J. 144 and Beni Prasad v. The District Judge, Allahabad, AIR 1982 All 103 . It is urged that if indeed the Government were to go by Clause 12 of the ULCRA, then the acquisition proceedings under the ULCRA would have to start under Section 10 ulcra. The provisions of Sections 6, 8 and 9 of the ULCRA would have to be followed and the choice again would be with the landholder as to which portion of the land he ceases to surrender and here the Government runs the risk of not being able to get the piece of land it wishes to for the purpose of widening of the road. This lengthy explanation is basically to justify the invocation by the Government of the la Act as against the ULCRA. 5. 4 Finally it is submitted that notwithstanding the judgment of the Hon'ble supreme Court in K. Narendra v. Riviera Apartments Private Limited, the right of the petitioners herein to retain the compensation under the LA Act remained unaffected.
This lengthy explanation is basically to justify the invocation by the Government of the la Act as against the ULCRA. 5. 4 Finally it is submitted that notwithstanding the judgment of the Hon'ble supreme Court in K. Narendra v. Riviera Apartments Private Limited, the right of the petitioners herein to retain the compensation under the LA Act remained unaffected. This was because although the agreement had been held to be incapable of being enforced, it had not been declared as void or illegal. It is submitted that in para 19 of its judgment the Hon'ble Supreme Court noted the fact that the petitioners had received land acquisition compensation and this was the reason why the compensation awarded to the petitioners in lieu of specific performance was limited to Rs. 3,25,000 with interest of 12% p. a. from the date of the decree. Else, given the present value of the said property, the compensation directed to be paid would have been much higher. ( 6 ) 6. 1 In reply, Mr. Sanjay Poddar, learned Counsel for the respondents, submits that the petitioner having availed of the benefit of an exemption under the provisions of Section 20 (1) ULCRA cannot wriggle out of Clause 12 thereof which is unambiguous. The petitioners had clearly consented to surrendering land for the purpose of any public works, including the widening of road, etc. to the Government in terms of ULCRA. In support of is submission that the petitioners had wilfully suppressed material facts in the land acquisition proceedings, he points out that although in their letter dated 29. 4. 1992 to the LAC, the petitioners stated that they were forwarding a copy of the ULCRA exemption order dated 26. 4. 1985, the said document was in fact not enclosed to the said letter. Even in the subsequent letter dated 30. 9. 1992 written to the LAC, the petitioners never mentioned the fact of the exemption order under the ULCRA. 6. 2 It is then submitted by the respondents that after the judgment of the hon'ble Supreme Court the agreement to sell dated 25. 7. 1972 was unenforceable and the very basis of the claim of the petitioners did not survive. The legal position was that there was no agreement at all from the inception. Therefore, the petitioners had no locus standi to claim and much less receive the compensation payable under the LA Act.
7. 1972 was unenforceable and the very basis of the claim of the petitioners did not survive. The legal position was that there was no agreement at all from the inception. Therefore, the petitioners had no locus standi to claim and much less receive the compensation payable under the LA Act. Reliance was placed on the judgment of the Hon'ble Supreme Court in Ratan Kumar Tandon v. State of U. P. , 111 (1996) CLT 359 (SC)= (1997) 2 SCC 161 in support of the contention that in relation to a parcel of land where the provisions of ULCRA apply, the said legislation would have an overriding effect on the subsequent application of the LA Act in respect of that very piece of land. It would not be necessary, in that event, to determine compensation payable for such land under the LA Act and for that purpose only the ULCRA would apply. 6. 3 Finally, it is submitted on behalf of the respondents that even on equities it would be seen that by virtue of the stay of recovery granted by the interim order dated 10. 1. 1995 of this Court, the petitioners had for over 10 years retained and earned interest on over 50% of the compensation amount although they were not entitled to any portion of it. ( 7 ) MR. Tushar Rao, learned Counsel for the applicant in CM 11559 of 2000, shri K. Narendra, submitted that this Court should direct the compensation to be paid to Shri K. Narendra in the event it held that the petitioners were held not entitled for the same. He submitted this would avoid multiplicity of proceedings. Issues for consideration ( 8 ) ON a conspectus of the facts, the pleadings and the submissions, the following issues arise for consideration in this petition: (a) Was the acquisition of a portion of the said property for road widening purposes wrongly made under the LA Act when it should have been acquired under the ULCRA? Consequently, are the respondents justified in seeking to invoke the under the Punjab land Revenue Act, 1887 to recover the land acquisition compensation paid to the petitioners under the LA Act? (b) In any event, are the petitioners entitled to the land acquisition compensation and what is the effect of the judgment of the Hon'ble supreme Court in K. Narendra v. Riviera Apartments Private limited on such entitlement?
(b) In any event, are the petitioners entitled to the land acquisition compensation and what is the effect of the judgment of the Hon'ble supreme Court in K. Narendra v. Riviera Apartments Private limited on such entitlement? (c) Are the respondents justified in seeking to withdraw the ULCRA exemption dated 26. 4. 1985 on the ground of violation of its conditions by the petitioners? (d) Is Shri K. Narendra, the applicant in CM 11559 of 2000 entitled to any relief? (e) What are the consequential directions that are required to be issued? re: Issue (a) ( 9 ) IN the first place, the provisions of the ULCRA relevant to the present petition may be noticed. S. 6 requires "every person holding vacant land in excess of the ceiling limit at the commencement" of the ULCRA to "file a statement before the competent authority having jurisdiction specifying the location, extent, value and such other particulars as may be prescribed of all vacant lands and of any other land on which there is a building, whether or not with a dwelling unit therein, held by him (including the nature of his right, title or interest therein) and also specifying the vacant lands within the ceiling limit which he desires to retain. " This process can be triggered by the competent authority as well under Section 6 (2 ). ( 10 ) THEREAFTER under Section 8 the competent authority will after an inquiry prepare a draft statement which will indicate, inter alia, "the particulars of all vacant lands and of any other land on which there is a building, whether or not with a dwelling unit therein, held by such person," and "the particulars of the vacant lands which such person desires to retain within the ceiling limit". The final orders are then passed by the competent authority under Section 8 (4) after hearing the objections to the draft statement. ( 11 ) THE other relevant provision is Section 10 (1) which empowers the competent authority to issue a notification to acquire such portion of the excess land and thereafter proceed to acquire such land after observing the procedure outlined thereunder.
( 11 ) THE other relevant provision is Section 10 (1) which empowers the competent authority to issue a notification to acquire such portion of the excess land and thereafter proceed to acquire such land after observing the procedure outlined thereunder. Sub-section (3) states that: "after the publication of the notification under Sub-section (1), the competent authority may, by notification published in the Official Gazette of the State concerned, declare that the excess vacant land referred to in the notification published under Sub-section (1) shall, with effect from such date as may be specified in the declaration, be deemed to have been acquired by the State Government free from all encumbrances with effect from the date so specified. " Under Section 10 (2) the competent authority is empowered to pass orders to settle the claims of persons interested in the land so acquired. Compensation is payable in terms of Section 11 ULCRA. ( 12 ) THE power to exempt certain lands from the purview of the ULCRA is contained in Section 20 which reads as under: "20. Power to exempt. (1) Notwithstanding anything contained in any of the foregoing provisions of this Chapter, (a) where any person holds vacant land in excess of the ceiling limit and the State Government is satisfied, either on its own motion or otherwise, that, having regard to the location of such land, the purpose for which such land is being or is proposed to be used and such other relevant factors as the circumstances of the case may require, it is necessary or expedient in the public interest so to do, that Government may, by order, exempt, subject to such conditions, if any, as may be specified in the order, such vacant land from the provisions of this Chapter; (b) where any person holds vacant land in excess of the ceiling limit and the State Government, either on its own motion or otherwise, is satisfied that the application of the provisions of this Chapter would cause undue hardship to such person, that Government may, by order, exempt, subject to such conditions, if any, as may be specified in the order, such vacant land from the provisions of this chapter: provided that no order under this Clause shall be made unless the reasons for doing so are recorded in writing.
(2) If at any time the State Government is satisfied that any of the conditions subject to which any exemption under Clause (a) or Clause (b) of Sub-section (1) is granted is not complied with by any person, it shall be competent for the State Government to withdraw, by order, such exemption after giving a reasonable opportunity to such person for making a representation against the proposed withdrawal and thereupon the provisions of this Chapter shall apply accordingly. " ( 13 ) THE significance of the ULCRA is that once the excess land is determined in terms of Section 6 of the Act such excess land should normally vest with the State government in terms of Section 6 (2) of the Act. Section 20 is the exception to this. The exemption to be granted under Section 20 is invariably hedged in with certain conditions and therefore that will have to be specifically construed. In other words, a party availing exemption under Section 20 of the ULCRA, has to comply with all the conditionalities attached with the exemption order. He cannot choose to avail of the exemption and not comply with these conditions. Since the party in whose favour the exemption is granted is being permitted to retain the excess land, such a party cannot be heard to say that the conditions attached to the exemption takes away any right that such party may have under certain other provisions of the ulcra. ( 14 ) TURNING to the facts of the present case, Clause 12 of the order dated 26. 4. 1985 exempting the lands found to be in excess from the provisions under ulcra clearly stipulates that the petitioner will surrender, "whenever such land is required" for "widening of the road, laying of sewers or for any other public purposes by the DDA or any other (Authority ). " And further that this surrender of the land to the Government would be "on payment of the amount as mainly determined under the ULCRA, 1976. " What in fact this means is that the area of such excess land that is required for road widening purpose is not left to the choice of the landowner. That extent of the land will be obviously determined by the public authority which requires such land, in this case the NDMC.
" What in fact this means is that the area of such excess land that is required for road widening purpose is not left to the choice of the landowner. That extent of the land will be obviously determined by the public authority which requires such land, in this case the NDMC. If land was required for widening of the Tolstoy Marg then obviously it will only be the front portion of the property abutting the Tolstoy Marg that will be needed for this purpose. Also it is abundantly clear that Clause 12 took away from the petitioners the right to surrender such land as they chose to the Government. By accepting the exemption order, the petitioners consciously accepted this position. ( 15 ) THERE is a basic fallacy in the submissions of the petitioners that in order to invoke the ULCRA for acquisition of the land required for widening of the road, the exemption order dated 26. 4. 1985 would have to be withdrawn. In fact, the right of the Government to acquire part of the excess land for the purpose of road widening is traceable to Clause 12 of this very exemption order which has been accepted and acted upon by the petitioners. Therefore, the submission that the government, if it wants to acquire the excess land for road widening will be relegated to the Section 10, ULCRA is wholly misconceived and on an improper understanding of the exemption order dated 26. 4. 1985. Accordingly, we are of the view that the decisions in State of U. P. v. L. J. Johnson; M/s. M. S. Bansal Pvt. Ltd. v. District Judge Aligarh and Beni Prasad v. The District Judge, Allahabad, which have been relied upon by the petitioners in this regard, are not relevant for the present case. ( 16 ) IT is perhaps in acknowledgement of this difficulty, that the petitioners consciously sought to challenge the validity of Clause 12 of the order dated 26. 4. 1985 itself. In our view not only is the challenge belated but is wholly impermissible and unsustainable for the simple reason that having enjoyed the benefit of the said order till 1994, the petitioners ought not to be permitted to turn around and challenge that very order when things became difficult for them.
4. 1985 itself. In our view not only is the challenge belated but is wholly impermissible and unsustainable for the simple reason that having enjoyed the benefit of the said order till 1994, the petitioners ought not to be permitted to turn around and challenge that very order when things became difficult for them. The challenge also lacks bona fides because, after obtaining the exemption under the ulcra, the petitioners took advantage of the proceedings under the LA Act without drawing the attention of the LAC to the said ULCRA exemption order dated 26. 4. 1985. 17. 1 The facts on record also reveal that the petitioners, at various points in time either made knowingly false statements on affidavit before the authorities or suppressed material facts. On 13. 4. 1992 petitioner No. 2, Inder P Choudhrie, the managing Director of petitioner No. 1 submitted an affidavit at the time of receipt of the land acquisition compensation. This affidavit has been annexed to the rejoinder filed by Shri K. Narendra in CM No. 11559 of 2000. This affidavit was also annexed by Inder P Choudhrie himself in his reply to the Civil Writ No. 660 of 1993 filed by Anil Narendra, the son of K. Narendra. In this affidavit the petitioner No. 2 has made the following statements which appear to be false and false to his knowledge: "i, Inder P Choudhrie, Managing Director of M/s. Riviera Apartments pvt. Ltd. . . . . . . . . . . do hereby solemnly affirm and declare as under: 1. That the Riviera Apartments Pvt. Ltd. is the owner of the land as per records submitted situated at 6 Tolstoy Marg, New Delh. . . . . . . . 2. . . . . . . . . . . . . . . . . 3. That the deponent company has got full shares in above land and is entitled to receive the interim compensation awarded by the Land acquisition Collector, Delhi, under the said amount amounting to rs. 4,13,364. 60 p. 4. That if the title of the aforesaid land is found incorrect, I shall be liable to refund the compensation amount as paid to the Government. 5. . . . . . . . . . . . . . . . . . . . . . . . . " 17.
4,13,364. 60 p. 4. That if the title of the aforesaid land is found incorrect, I shall be liable to refund the compensation amount as paid to the Government. 5. . . . . . . . . . . . . . . . . . . . . . . . . " 17. 2 The aforesaid affidavit contains a false statement by the petitioner No. 1 that it is the "owner of the land" when admittedly at this point in time there was no sale deed in favour of the petitioner No. 1 in respect of the said land. What had been executed was the agreement to sell dated 25. 7. 1972 and 26. 7. 1972. This much was stated by the petitioners themselves in their letter dated 9. 11. 1972 while replying to the show cause notice issued by the Landdo (as extracted in para 2. 5. above ). Secondly, in the power of attorney executed by K. Narendra in favour of petitioner No. 1 (a copy of which has be annexed to the rejoinder in CM No. 11559 of 2000), there is no clause that authorises petitioner No. 1 to receive any land acquisition compensation payable to the original owner Shri K. Narendra. Therefore the assertion made in para 3 of the above affidavit is also false. Further, the petitioners were aware at this stage that the title may be defective and, therefore, gave assurance in the affidavit that in such eventuality they "shall be liable to refund the compensation amount as paid to the Government. " Therefore, unmistakably there has been a deliberate attempt by the petitioners to mislead the Government by making false statements on the basis of which they received the land acquisition compensation. 17. 3 Turning to the aspect of suppression of a material facts by the petitioners before the LAC, it is seen that in its letter dated 29. 4. 1992 to the LAC, the petitioners stated: "with reference to the above and as per your inquiry, we are pleased to enclose herewith copies of the following sanctions: 1. DDA letter dated 3. 4. 1991. 2. Delhi Urban Art Commission Consent dated 26. 4. 1991. 3. Urban Land Ceiling Clearance dated 26. 4. 1985. 4. Landdo permission dated 30. 8. 1990. 5. NDMC letter sanctioning plans dated 4. 6. 1991. We trust you will find the above in order.
DDA letter dated 3. 4. 1991. 2. Delhi Urban Art Commission Consent dated 26. 4. 1991. 3. Urban Land Ceiling Clearance dated 26. 4. 1985. 4. Landdo permission dated 30. 8. 1990. 5. NDMC letter sanctioning plans dated 4. 6. 1991. We trust you will find the above in order. " 17. 4 However, it has been stated in the counter affidavit filed by the DDA that in fact none of these enclosures were annexed to the said letter. This appears to be a disputed question, which we need not to go into at this stage. However, as will be noticed hereafter it does appear that the ULCRA exemption order was not enclosed to the said letter. On the very next date. e. on 30. 4. 1992 when the petitioners wrote to the Deputy Commissioner, Delhi Development Authority on the very subject of "acquisition of part of land of Plot No. 6, Tolstoy Marg, New delhi for widening of the road," they gave a long explanation as to why the value of the land for the purpose of payment of compensation should be much higher than what was being proposed. It was stated in this letter as under: "we have filed our claims and all supporting documents and papers several weeks ago and have, therefore, to request you that since the possession has been taken over, its award fixing the compensation may kindly be announced without delay, as we are suffering great hardship in the absence of due compensation forthe land which has been taken over. " 17. 5 In this long letter requesting higher compensation there is no mention of the ULCRA exemption order dated 26. 4. 1985, much less of Clause 12 of the said order which requires compensation to be determined under the ULCRA. In our view, such avoidance of mention of the ULCRA exemption order dated 26. 4. 1985 in the letter dated 30. 4. 1992 lends credence to the respondent's plea that the said exemption order was not annexed to the letter dated 29. 4. 1992 and thus there can be no manner of doubt that petitioners wilfully suppressed this material fact in the land acquisition proceedings. 17. 6 A further letter dated 12. 5. 1992 written by the petitioner to the LAC encloses the documents pertaining to the title of the original owner Shri K. Narendra.
4. 1992 and thus there can be no manner of doubt that petitioners wilfully suppressed this material fact in the land acquisition proceedings. 17. 6 A further letter dated 12. 5. 1992 written by the petitioner to the LAC encloses the documents pertaining to the title of the original owner Shri K. Narendra. In para 2 of the said letter dated 12. 5. 1992 it is stated as under: "2. That thereafter having obtained a decree from the Delhi High Court dated 5. 12. 1990 and having complied with its onerous conditions fully and having obtained sanction of plans from all concerned authorities including U. L. (Candr), the Landdo etc. , we are fully entitled to receive the entire compensation that your honour may grant in respect of the acquisition of a part of the land acquired for road widening. For this purpose we are enclosing another opinion of a very matured and distinguished advocate of the Delhi High Court, Shri Dinesh Kumar Garg, dated 7. 5. 1992. 3. Our further contention is that this Plot No. 6 Tolstoy Marg is located bang opposite the most valuable and priced district commercial centre of connaught Place. A sketch plan of the entire area is enclosed in which we have marked the residential pocket of Hailey Road in green and the commercial district of Connaught Place in orange colour. From this sketch the commercial buildings where offices of International Airlines like K. L. M. and foreign banks like Bank of America, Banque de Paris, etc. , are located. In fact, in the vicinity of this plot within 200 mtrs. North and South of this property are located many other banks and a hotel named Kansa. Similarly, on the residential side there is a highly successful guest house/informal hotel running at No. 13 Kasturba Gandhi Marg by the name of Central Point Tourist Home. " 17. 7 The statement made in para 2 above that "having obtained sanction of plans from all concerned authorities including U. L. (Candr), the Landdo, etc. , we are fully entitled to receive the compensation" is a plainly misleading and an incorrect statement. In the first place, to the petitioners' knowledge they knew that the exemption under the ULCRA clearly stipulated that the compensation would be payable only in terms of the ULCRA.
, we are fully entitled to receive the compensation" is a plainly misleading and an incorrect statement. In the first place, to the petitioners' knowledge they knew that the exemption under the ULCRA clearly stipulated that the compensation would be payable only in terms of the ULCRA. Secondly, even the plans sanctioned in 1991 were hedged in with conditions which had not been fulfilled by the petitioners. The sanction order itself states in Clause 14 that if the conditions attached to the sanction are not complied with "the sanction will be void ab initio. " The plans were required to be "got approved separately under the terms of the lease from the lessor. e. Land and Development Office. " Here again, it is an admitted case that this approval of the landdo was never obtained. Accordingly it is clear that the petitioners were not entitled to land acquisition compensation even as per Clause 13 of the agreement to sell dated 25 and 26. 7. 1972. Thirdly, and most importantly, by this time the two suits as mentioned hereinbefore had been filed, by the petitioners on the one hand and Shri K. Narendra on the other, casting a serious doubt on the enforceability of the agreement to sell dated 25 and 26. 7. 1972 under which the petitioners were claiming their rights. There is no mention of this litigation in the correspondence referred to above. 17. 8 Clearly the Government was misled in the making of the payment of the land acquisition compensation to the petitioners only on the basis that the original owner has not come forward to claim compensation, whereas the power of attorney holder did make such a claim. As already mentioned, the LAC appears to have missed noticing that the said power of attorney in fact contained no clause authorizing the attorney holder to receive land acquisition compensation. Further, clause 13 of the agreement also could not, in the circumstances explained above, be invoked by the petitioners to claim the compensation. The authorities were also misled by the petitioners and consequently failed to notice the facts and circumstances outlined above which show that the petitioners were not at all entitled to receive the land acquisition compensation.
Further, clause 13 of the agreement also could not, in the circumstances explained above, be invoked by the petitioners to claim the compensation. The authorities were also misled by the petitioners and consequently failed to notice the facts and circumstances outlined above which show that the petitioners were not at all entitled to receive the land acquisition compensation. ( 18 ) IN the above facts and circumstances, we find absolutely no justification for the conduct of the petitioners in making false statements on affidavit before the authorities and in suppressing material facts. In our view, this tantamounts to a fraud played on the respondents which vitiates the entire award dated 28. 5. 1992 of the LAC pursuant to which the compensation of Rs. 71. 34 lakh was paid to the petitioners. Since fraud vitiates all transactions, the respondents are fully justified in requiring the petitioners to return the sum of Rs. 71. 34 lakh wrongly paid to them. ( 19 ) IN Smith v. East Elloe Rural Distt. Council, 1956 AC 736. the House of lords held that the effect of fraud would normally be to vitiate any act or order. In another case, Lazarus Estates Ltd. v. Beasley, (1956) 1 All ER 341, Denning, L. J. said: "no judgment of a Court, no order of a Minister, can be allowed to stand if it has been obtained by fraud. Fraud unravels everything. " This principle has been reiterated by the Hon'ble Supreme Court in several decisions. Illustratively, a reference may be made to the decision in Indian Bank v. Satyam Fibres India (P) Ltd. , (1996) 5 SCC 550 , which we respectfully follow. ( 20 ) ONCE it is held that the petitioners obtained the compensation by practising a fraud, all acts and steps consequent to the award, which unfortunately stands vitiated on account of the suppression of material facts and the false statements on which it is based ought to be directed to be corrected and reversed. The consequential order that is required to be given is that the said amount is liable to be straightaway recovered from the petitioners by the respondents. In this view of the matter, we do not consider it necessary to examine the other question whether the provisions of the Punjab Land Revenue Act, 1887 could be invoked for this purpose.
The consequential order that is required to be given is that the said amount is liable to be straightaway recovered from the petitioners by the respondents. In this view of the matter, we do not consider it necessary to examine the other question whether the provisions of the Punjab Land Revenue Act, 1887 could be invoked for this purpose. This Court has ample powers under Article 226 in the interests of justice to give directions to reverse the adverse effect of an order or award, as the case may be, that is obtained by practising fraud. We may also note here that petitioner No. 2 had in the affidavit dated 13. 4. 1992 given at the time of receiving the land acquisition, undertaken that: "if the title of the aforesaid land is found incorrect, I shall be liable to refund the compensation amount as paid to the Government. " ( 21 ) WE accordingly hold that the petitioners were not entitled in law to receive the land acquisition compensation determined to be payable by the award dated 28. 5. 1992 of the LAC. We answer Issue (a) by holding that: (i) The acquisition of a portion of the said property for road widening purposes was wrongly made under the LA Act when it should have been acquired under the ULCRA; (ii) The petitioners have wrongly obtained the award of land acquisition compensation in their favour by practising a fraud on the authorities; (iii) Consequently, the respondents are justified in seeking to recover the land acquisition compensation paid to the petitioners erroneously under the LA Act in terms of the notice dated 4. 7. 1994. Re: Issue (b) ( 22 ) ALTHOUGH the answerto Issue (a) should suffice to dismiss the present writ petition, we may nevertheless consider the effect of the judgment of the Hon'ble supreme Court in K. Narendra v. Riviera Apartments Private Limited. We may note that in order to be able to receive any compensation under the LA Act, a claimant must demonstrate that, in terms of Section 9 of that statute such person has an 'interest' in such land.
We may note that in order to be able to receive any compensation under the LA Act, a claimant must demonstrate that, in terms of Section 9 of that statute such person has an 'interest' in such land. Section 10 envisages the Collector requiring information about "every other person possessing any interest in the land or any part thereof as co-proprietor, mortgagee, tenant or otherwise, and of the nature of such interest, and of the rents and profits (if any) received or receivable on account thereof for three years next preceding the date of the statement. " Therefore, in view of the above provisions compensation can be payable even to a beneficiary under an agreement to sell if such person is able to demonstrate that by virtue of such agreement he has an interest in the land in question and is entitled therefore to receive compensation. ( 23 ) AS far as the present case is concerned, the question of the enforceability of the agreement to sell executed by Shri K. Narendra in favour of the petitioners was undecided at the time of the LAC making the award. Also, by this time disputes between the parties had already reached the Courts precisely for the reason that the sale deed in respect of the said property had not been executed in favour of the petitioners. The title and interest in the land therefore had not yet passed on to the petitioners. The Hon'ble Supreme Court in K. Narendra v. Riviera Apartments private Limited held that the land owner, Shri K. Narendra, had been successful in demonstrating that the agreement to sell was no longer capable of being enforced. The power of attorney issued in his favour by Shri K. Narendra was obviously pursuant to the agreement to sell. Once it has been held by the Hon'ble Supreme court that the agreement to sell is non-enforceable, the power of attorney executed by Shri K. Narendra in favour of petitioner No. 2 is no longer valid. ( 24 ) THE resultant position is that the petitioners cannot retain any benefit they may have got in their capacity as the constituted attorney of the original owner. In other words, the non-enforceability of the agreement to sell would constitute a deemed revocation of the power of attorney in favour of the petitioner No. 2.
( 24 ) THE resultant position is that the petitioners cannot retain any benefit they may have got in their capacity as the constituted attorney of the original owner. In other words, the non-enforceability of the agreement to sell would constitute a deemed revocation of the power of attorney in favour of the petitioner No. 2. Viewed from this angle as well, the petitioners are not entitled to retain the compensation in the sum of Rs. 71. 34 lakh for the property in question. Issue (b) is answered accordingly. Re: Issue (c) ( 25 ) THE detailed analysis of the facts reveals that Clauses 9 and 12 of the ulcra exemption order dated 26. 4. 1985 have been breached by the petitioners entailing the cancellation of the said order in terms of Clause 14 which stipulates that in such event "it shall be competent for the Administrator of Delhi to withdraw by order, such exemption after giving the reasonable opportunity to such person for making a representation against the proposed withdrawal. " This is also in conformity with Section 20 (2), ULCRA. It is for this purpose that the show cause notice dated 29. 4. 1994 has been issued. We see no infirmity in the said notice. We may add that in view of what has been found hereinabove, the petitioner No. 2 to whom this notice is issued is no longer entitled to act as the constituted attorney of Shri k. Narendra. Further, in view of the categorical finding that the conditions attaching to the exemption order dated 26. 4. 1985 have been breached, little purpose will be served in directing the a further notice for withdrawal of exemption to Sri K. Narendra. ( 26 ) THE consequence of the above discussion is that the exemption in respect of 368. 23 sq. m. of land in said property would have to be treated as withdrawn. In other words, it would have to be treated as excess land in terms of the ULCRA by not accounting for the exemption granted by the order dated 26. 4. 1985. The compensation in respect of the portion of 153. 98 sq. m. of this excess land acquired for road widening purposes would become payable under S. 11 ULCRA and not the la Act.
4. 1985. The compensation in respect of the portion of 153. 98 sq. m. of this excess land acquired for road widening purposes would become payable under S. 11 ULCRA and not the la Act. This has been clarified by the Hon'ble Supreme Court in Ratan Kumar tandon v. State of U. P. (supra): "it is not necessary for the State to proceed with the determination of the compensation under Section 23 (1) of the (Land Acquisition) Act to the extent of the excess land found under the Ceiling Act. Compensation shall be paid only as per Section 11 (6) of the Ceiling Act. " ( 27 ) ISSUE (c) is accordingly answered by holding that the respondents are fully justified in seeking to withdraw the ULCRA exemption dated 26. 4. 1985 on the ground of the violation of its conditions by the petitioners. Further, consequent to the vesting of the 153. 98 sq. m. of land in the Government for the purposes of road widening, the compensation is required to be paid in terms of the ULCRA and not the LA Act. Re: Issue (d) ( 28 ) ON the plea of the applicant in CM 11559 of 2000, Shri K. Narendra, it requires to be noticed that the Civil Writ Petition No. 660/1993 filed by his son Shri anil Narendra has been dismissed on 7. 9. 2006 for non-prosecution. As regards shri Narendra himself, it is apparent that he chose to go along with the petitioners throughout the proceedings before the LAC even while he was keeping alive the dispute between him and the petitioners on the issue of the specific performance of the agreement to sell. Shri K. Narendra, we are constrained to observe, has also not been forthcoming in exposing the fraud played by the petitioners in receiving the land acquisition compensation. He chose to have his son Anil Narendra bear the burden of exposing the fraud played by the petitioners. In any event, as already discussed hereinabove, there is no question of anyone, including Shri Narendra, being entitled to compensation under the LA Act. Therefore, there is no question of Shri K. Narendra being permitted to substitute the petitioners in the present petition or being directed to be paid the land acquisition compensation.
In any event, as already discussed hereinabove, there is no question of anyone, including Shri Narendra, being entitled to compensation under the LA Act. Therefore, there is no question of Shri K. Narendra being permitted to substitute the petitioners in the present petition or being directed to be paid the land acquisition compensation. ( 29 ) AS regards the compensation payable in terms of the ULCRA, the law should now take its course and if it is found that Shri K. Narendra is entitled to any compensation in terms of the ULCRA for the extent of land acquired for road widening purposes, that should be determined and paid to him by the respondents in accordance with law. Issue (d) is answered accordingly. Re: Issue (e) ( 30 ) WE may now examine what consequential directions are required to be issued. At this stage we may dispose of a plea made by the petitioners on equity. It was submitted that the said property is worth over Rs. 20 crores today and that so far the petitioners have received only about Rs. 17 lakh (by way of the return of the moneys by Shri K. Narendra together with interest and compensation in lieu of specific performance ). This despite the fact that they had an agreement to sell in their favour from 1972 till 1999. We fail to appreciate this submission for the simple reason that what the petitioners are complaining about is, in fact, the loss of an "opportunity cost" concerning a property in respect of which they have no enforceable right, title or interest. On the contrary, the petitioner has received not only Rs. 17 lakh as explained above, but the entire land acquisition compensation money, of which the petitioners have retained Rs. 35 lakh for the last 11 years. On this sum, the petitioners have earned interest as well. Moreover, the bank guarantee charges in respect of Rs. 36. 33 lakh are not substantial in comparison with the interest that the petitioners would have earned on Rs. 35 lakh. Looked at from any angle, the petitioners have little to complain about. In our considered view, the petitioners are not entitled to any equitable relief whatsoever. On the other hand, in view of the conduct of the petitioners in practising a fraud on the respondents, they are liable to pay exemplary costs.
35 lakh. Looked at from any angle, the petitioners have little to complain about. In our considered view, the petitioners are not entitled to any equitable relief whatsoever. On the other hand, in view of the conduct of the petitioners in practising a fraud on the respondents, they are liable to pay exemplary costs. They should be also directed to pay some interest on the moneys wrongfully retained by them, at least from 15. 7. 1994,. e. on the expiry of the ten day period stipulated in the notice dated 4. 7. 94 issued by the respondents asking them to return the land acquisition money wrongly paid to them. ( 31 ) WE are of the view that in the facts and circumstances of the present case while dismissing the Civil Writ Petition we must in the exercise of our powers under Article 226 of the Constitution issue directions to ensure that the moneys wrongly paid to the petitioners are recovered at the earliest. This has become essential as the petitioners have enjoyed interim relief from this Court for a long period from 10. 1. 1995 till date. The exchequer has been deprived of this substantial sum of Rs. 71. 34 lakh wrongly paid to the petitioners together with interest for over fourteen years. Accordingly we direct as under: (a) The sum of Rs. 35 lakh already deposited in this Court together with any interest accrued thereon must be made over by the Registry immediately to the LAC respondent No. 4. (b) The Bank guarantee furnished on 16. 3. 1995 by the Punjab and Sind bank for the balance sum of Rs. 36,33,950 which is valid till 30. 1. 2007, will be invoked forthwith and the said amount shall be paid to respondent No. 4 by the Registry. This direction will be treated as a 'demand and direction' to the effect "that the said amount has become finally payable by the petitioners" in terms of the Bank guarantee and the Punjab and Sind Bank will proceed to act on that basis. (c) The Registry will ensure the strict compliance of the directions in (a) and (b) above within a period of four weeks from today and in any event not later than December 15, 2006. (d) The petitioners will pay to the respondent GNCTD through respondent no.
(c) The Registry will ensure the strict compliance of the directions in (a) and (b) above within a period of four weeks from today and in any event not later than December 15, 2006. (d) The petitioners will pay to the respondent GNCTD through respondent no. 1 the following sums, within a period of four weeks from today and in any event not later than December 15, 2006. (i) The sum in the equivalent of interest at the rate of 9% simple interest on the sum of Rs. 36,33,950 for the period 15. 7. 1994 till 15. 12. 2006. (ii) The costs of this petition which we quantify at Rs. 25,000/ -. (e) The respondentno. 6 (Urban Land Ceiling Cell, Land and Building department, GNCTD) will within four weeks from today, and in any event not later than 15. 12. 2006, determine whether Shri K. Narendra is entitled to any compensation in terms of the ULCRA for the extent of land acquired for road widening purposes and if any sum is found payable, the same should be paid to him by the respondents in accordance with law within four weeks thereafter. ( 32 ) WITH the above directions, the writ petition is dismissed. The interim orders stand vacated and all applications are disposed of. Writ Petition dismissed.