JUDGMENT Hon’ble Tarun Agarwala, J.—The father of the petitioner was the owner of various plots, measuring approximately 27,292 sq. mtrs, which is situate in Village Lahartara, Pargana Dehat Amanat, District Varanasi, which was being used for agricultural purposes. The petitioner’s father indicated his intention to develop the land as a residential colony, and consequently, applied before the Varanasi Development Authority under Section 14 of the Uttar Pradesh Urban Planning and Development Act, 1973 (hereinafter referred to as the Act) for the development of the land in question. The Authority, by its order dated 3rd December, 1987, granted permission to develop the land and sanctioned a lay out plan. On 9th of June, 1988, an agreement was executed between the petitioner, his father, and other brothers with the Varanasi Development Authority in which it was agreed that the owners would carry out the development of the lay out plan in accordance with the approved lay out of the area, standards and specifications, to the satisfaction of the Authority, giving adequate security for the due performance of the agreement. It was agreed that the owners would carry out the complete development of the area within one year from the date of the permission and that the internal development would be carried out in accordance with the specifications and designs laid down by the authority and that a completion certificate would be obtained from the Varanasi Development Authority after its development. In the agreement, it was further provided that the land that was set apart for the road, public parks and other public utility services, etc., would be handed over to the Government free from all encumbrances after the completion certificate was obtained, and that, before the transfer of the plot by way of sale, lease gift, etc., the owners would incorporate such terms and conditions as the Authority may prescribe. 2. The agreement further provided that in case of any breach of the terms and conditions of the agreement, the Authority would forfeit the security deposit and may direct any agency to carry out the development, and that the Authority would recover such charges which it would incur in the development of the land or the Authority itself could undertake the development and recover the charges from the owners. In the agreement, the owners were also required to furnish a security for carrying out the internal development.
In the agreement, the owners were also required to furnish a security for carrying out the internal development. The agreement indicated that the owners were required to furnish a bank guarantee of 125% of the total development cost, which amounted to Rs. 13,04,862.00, and was also required to submit a security by way of mortgage which was equivalent to 125% of the value of the internal cost of the development. 3. The petitioner’s father submitted a bank guarantee of Rs. 3,26,216.00 and a simple mortgage was also created on certain plots which was equal to 125% of the internal cost of the development. This mortgage was to be discharged upon grant of a no objection certificate from the Authority. Under clause (3) of the agreement, the petitioner had also deposited a sum of Rs. 1,20,342.50 towards external development cost which development was to be carried out by the authority. Under clause (8) of the agreement, any dispute or difference arising out of the agreement was to be referred to the sole arbitrator nominated by the Secretary to the Government. 4. From the aforesaid, it is clear that the petitioner, his father and the brothers were required to carry out the development of the land within one year, that is, on or before 9th of June, 1989. It is alleged that before the development could start, the petitioner’s father died, and on account of financial constraints, the project of the development of the land was abandoned. Consequently, no internal development took place on the land in question, nor the Authority carried out any external development. The lay out plan sanctioned by the Authority lapsed after the expiry of the stipulated period under the agreement. 5. After almost 10 years, a notice dated 18th of August, 1998 was issued under Section 33 of the Act directing the petitioner to show cause why development had not taken place pursuant to the sanction granted by the Authority and agreement entered between the parties. Pursuant to the said notice, the Authority passed an order dated 14th January, 1999 for the recovery of Rs. 13,04,862.00 which amount was towards the total cost for the internal development and further directed the Tehsildar to attach and auction the plots which had been mortgaged under the agreement.
Pursuant to the said notice, the Authority passed an order dated 14th January, 1999 for the recovery of Rs. 13,04,862.00 which amount was towards the total cost for the internal development and further directed the Tehsildar to attach and auction the plots which had been mortgaged under the agreement. The Authority, while passing the order for the recovery of the amount, found that as per physical inspection made on the spot, no internal development was carried out by the petitioner and that the petitioner had violated the terms and conditions of the agreement and that the bank guarantee given by the petitioner’s father had also lapsed. The petitioner, being aggrieved by the said order, filed a revision under Section 41 (3) of the Act which was dismissed by an order dated 9th August, 1999 as not maintainable. The petitioner, being aggrieved by the said order, has filed the present writ petition. 6. Before proceeding further, it is necessary to state here that before the revisional authority, respondent No. 12 Awadhesh Kumar Rai filed an impleadment application alleging that the petitioner had not developed the land and that it was the duty of the Authority to ensure that the land was developed as per the sanctioned lay out plan and agreement entered between the parties, and therefore, prayed that the petitioner, or the authority be directed to develop the land. The said respondent alleged that his predecessor had purchased two plots vide a sale deed dated 25.5.1992 and 26.8.1992, and thereafter, had constructed a house. 7. Heard Shri R.N. Singh, the learned Senior Counsel, duly assisted by Shri V.K. Singh, the learned counsel for the petitioner, Shri Ajit Kumar Singh, the learned counsel for the Varanasi Development Authority and Shri P.K. Jain and Shri S.K. Verma, the learned Senior Counsels for the private respondent No. 12. 8. The learned counsel for the petitioner submitted that the project was started by the petitioner’s father who was the head of the family, but on account of his untimely death, the whole project was abandoned, coupled with the fact that, the petitioner did not have the financial capacity to develop the land. The learned counsel submitted that admittedly no internal development of the land was carried out by the petitioner or by his father and that the sanction granted by the authority had lapsed.
The learned counsel submitted that admittedly no internal development of the land was carried out by the petitioner or by his father and that the sanction granted by the authority had lapsed. The petitioner did not apply for the extension of the sanction granted by the Authority. The learned counsel submitted that upon the lapse of the agreement and the sanction granted by the Authority, the petitioner could not be forced to develop his land against his own wishes and that the agreement entered between the parties became a void agreement under Section 56 of the Contract Act since it became impossible to develop the land under the changed circumstances. 9. On the other hand, the learned counsel for the Authority submitted that the notice was rightly issued under Section 33 of the Act since the petitioner or his father or his brother had not developed the land as per the sanctioned lay out plan as per the agreement, and therefore, the demand made by the Authority towards the development cost was rightly made. The learned counsel further submitted that under clause (8) of the agreement the petitioner had a remedy to refer the dispute before an arbitrator, and consequently, the writ petition should be dismissed on the ground of alternative remedy. 10. Shri P.K. Jain, the learned Senior Counsel for the private respondent submitted that he is a bonafide purchaser of two plots and that he was duped by the owners into believing that the land was developed. The learned counsel submitted that as per the agreement, the petitioner as well as the Varanasi Development Authority were duty bound to develop the land, and consequently, a direction should be issued to the petitioner or to the Authority to develop the land as per the agreement and the sanctioned plan. Shri S.K. Verma, the learned Senior Counsel for the same private respondent further submitted that the Authorities were justified in forfeiting the security, and relied upon a decision of the Supreme Court in Chairman of the Bankura Municipality, Bankura v. Lalji Raja & Sons, AIR 1953 SC 248 , and further submitted that the petitioner had an alternative remedy of raising the dispute before the arbitrator under the agreement and contended that the writ petition should be thrown out on this ground itself.
In support of his submission the learned counsel placed reliance upon the decision of the Supreme Court in Agri Gold Exims Ltd. v. Sri Lakshmi Knits & Wovens and others, 2007 (3) SCC 686 , and The Empire Jute Co. Ltd. and others v. The Jute Corporation of India Ltd. and another, JT 2007 (12) SC 391. 11. In rejoinder, Shri R.N. Singh, the learned Senior Counsel for the petitioner submitted that the alternative remedy was not a bar and that the writ petition was entertained in the year 1999, and consequently, the said petition should not be thrown out after 10 years on the ground that the petitioner had an alternative remedy. In support of his submission the learned counsel has placed reliance on a decision of the Supreme Court in Dr. Bal Krishna Agarwal v. State of U.P. and others, 1995 (1) SCC 614 . 12. Having heard the learned counsel for the parties, at some length, no doubt the agreement contemplates that any dispute, difference or any question arising out of the agreement or touching or covering the subject matter thereof would be referred to the sole arbitrator nominated by the Secretary to the Government. Clearly, there is a remedy available, but in the circumstances of the case, the Court finds that the petitioner cannot be relegated to an alternative remedy at this stage. The petition was entertained in the year 1999. Ten long years have elapsed and it would be a travesty of justice to relegate the petitioner to an alternative remedy at this belated stage. The Supreme Court in Dr. Bal Krishna Agarwal’s case (supra) has clearly held : “Having regard to the aforesaid facts and circumstances, we are of the view that the High Court was not right in dismissing the writ petition of the appellant on the ground of availability of an alternative remedy under Section 68 of the Act especially when the writ petition that was filed in 1998 had already been admitted and was pending in the High Court for the past more than five years.” 13. In my view, the said decision is clearly applicable to the present facts and circumstances of the case.
In my view, the said decision is clearly applicable to the present facts and circumstances of the case. Further, the Court finds that the demand raised in the impugned order and the direction to auction the plots was not in consonance with the agreement or as per the provision of Section 33 of the Act, and therefore, the writ petition was rightly filed for the quashing of the illegal order issued by the Authority. This Court is therefore of the opinion that the writ petition is maintainable. 14. Section 33 of the Act provides that if any land, in which development is required to be carried out, has not been developed or such development has not been carried out or where any amenity has not been provided, in that case, the Authority may cause the owner of the land to make good and provide amenity or carry out the development within such time as may be specified in the order, failing which, the amenity or the development could be carried out by the Authority or by any such agency, and the expenses so incurred by the Authority or the agency would be recovered from the owner as arrears of land revenue. For facility, Section 33 (1), (2) and (3) of the Act is quoted hereunder : “33. Power of the Authority to provide amenity or carry out development at cost of owner in the event of his default and to levy cess in certain cases.—(1) If the Authority, after holding a local inquiry or upon report from any of its officers or other information in its possession, is satisfied that any amenity in relation to any land in development area has not been provided in relation to that land which, in the opinion of the Authority, ought to have been or ought to be provided or that any development of the land for which permission, approval or sanction had been obtained under this Act or under any law in force before the coming into force of this Act has not been carried out, it may, after affording the owner of the land or the person providing or responsible for providing the amenity a reasonable opportunity to show cause, by order require him to provide the amenity or carry out the development within such time as may be specified in the order.
(2) If any amenity is not provided or any such development is not carried out within the time specified in the order, then the Authority may itself provide the amenity or carry out the development or have it provided or carried out through such agency as it deems fit : Provided that before taking any action under this sub-section, the Authority shall afford a reasonable opportunity to the owner of the land or to the person providing or responsible for providing the amenity to show cause as to why such action should not be taken. (3) All expenses incurred by the Authority or the agency employed by it in providing the amenity or carrying out the development together with interest at such rate as the State Government may by order fix from the date when a demand for the expenses is made until payment may be recovered by the Authority from the owner or the person providing or responsible for providing the amenity as arrears of land revenue, and no suit shall lie in the civil Court for recovery of such expenses.” 15. Similar provision was also incorporated in the agreement, namely, Clause (2) which states as under : “(2) Provided always and it is hereby agreed that if the Colonisers shall commit any breach of terms and conditions of this agreement or if the Colonisers make any composition or arrangement with their creditors, then and in any such case, notwithstanding the waiver of any previous cause or right and over and above the action empowered to be taken under the provisions of the said Directions and Regulations as amended from time to time, the Authority may forfeit the security deposited by the Colonisers and may : (i) direct any other agency as it thinks fit to carry out the development in the Colony as the case may be, and the Authority may recover from the Colonisers such charges as it may incur or; (ii) itself undertake to complete the works and recover the charges from the Colonisers as it may incur.” 16. A reading of Section 33 of the Act and clause (2) of the agreement would indicate that in the event the owners fail to carry out the internal development, it would be open to the Authority to forfeit the security deposited by them.
A reading of Section 33 of the Act and clause (2) of the agreement would indicate that in the event the owners fail to carry out the internal development, it would be open to the Authority to forfeit the security deposited by them. Further, the Authority may carry out the development of the land and recover the charges from the owner. 17. In the present case, the Court finds that the Authority has not carried out any development of the land nor has directed any agency to carry out the development. Consequently, the demand of Rs. 13,04,862.00 towards internal development charges is patently illegal as per Section 33 of the Act. The development has to be carried out first and the amount has to be recovered thereafter and not vice versa. Further, neither the agreement, nor Section 33 of the Act contemplates auction of the plots, and consequently, this direction of the Authority is also patently erroneous. 18. There is another aspect of the matter. The agreement was conditional and was time bound, that is to say, the development of the land was required to be carried out within a stipulated period. The time stipulated under the agreement expired and the petitioner did not apply for extension of time as they had abandoned the project. The petitioner had no intention to carry out the development. 19. In my opinion, if the petitioner has not carried out any development, he could not be forced to carry out the development on his own land, but definitely, if the petitioner sells the land as per the lay out plan, the Varanasi Development Authority can refuse to sanction the said plan to the purchasers for construction purposes and could invoke the provision of Section 33 at that stage. 20. In the present case, the Court finds that the authority had made an inspection and found that no development whatsoever was carried out. 21. The contention of respondent No. 12 that two plots were sold to him by one of the brothers of the petitioner was not before the Authority nor was the impugned order passed on this ground. In any case, the said plots were sold after the expiry of the period under lay out plan.
21. The contention of respondent No. 12 that two plots were sold to him by one of the brothers of the petitioner was not before the Authority nor was the impugned order passed on this ground. In any case, the said plots were sold after the expiry of the period under lay out plan. How this plot was sold and how the Development Authority had sanctioned the plans for construction of a house in favour of the respondent No. 12 is not known, and consequently, the Court cannot take cognizance of these facts at this stage in these proceedings, and leave it open to the Development Authority to initiate fresh steps in accordance with law in the light of this fact which has now cropped up. 22. This Court finds that the plea of the agreement becoming void as per Section 56 of the Contract Act cannot be adjudicated since relevant pleadings are not on the record. The changed circumstances and the financial instability are such grounds which is required to be pleaded with certainty and vague pleadings cannot form the basis to hold that the agreement was void in view of the provision of Section 56 of the Contract Act. It is however relevant to state here that Section 56 of the Contract Act comes under Chapter 4 which relates to the performance of the contract and deals with one class of circumstance under which performance of a contract is dispensed with on the ground of the contract being void. The word ‘impossible’ has not been used in Section 56 in the sense of ‘physical or literal impossibility’ and on account of ‘change of circumstances’, it could be said that the performance of the contract became impossible and that the Authorities are absolved from further performance under the agreement. This view is in the lines of the doctrine on frustration where a party is discharged of the contract by reason of supervening impossibility of the act agreed to be done which can come under Section 56 of the Indian Contract Act. The relief is given by the Court on the ground of subsequent impossibility when it finds that the whole purpose or basis of a contract was frustrated by the intrusion or occurrence of an unexpected event or change of circumstances.
The relief is given by the Court on the ground of subsequent impossibility when it finds that the whole purpose or basis of a contract was frustrated by the intrusion or occurrence of an unexpected event or change of circumstances. However, specific pleadings are required to be raised which has not been raised, and therefore, this Court is not in a position to delve into this matter. 23. In view of the aforesaid, the impugned orders cannot be sustained and are quashed. The writ petition is allowed. It is open to the authority to proceed afresh in accordance with law. ———