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2016 DIGILAW 679 (ALL)

G. D. Engineers And Associates v. State Of U. P.

2016-02-25

RAKESH SRIVASTAVA, SUDHIR AGARWAL

body2016
ORDER : 1. Heard Sri H.R. Mishra, learned Senior Advocate assisted by Sri Ramji Mishra, Advocate for the petitioner and Sri Sunil Kumar Mishra, Advocate appearing for respondents 2 to 5. 2. Petitioner is aggrieved by order dated 10.12.2015 passed by Regional Manager, Uttar Pradesh State Industrial Development Corporation (hereinafter referred to as 'UPSIDC') rejecting petitioner's representation in respect to plot no. F-1 Mathura Site-B, area 13158 sq. meter. 3. It appears from record that certain piece of land was acquired by State of U.P. at Mathura (Site-B) under the provisions of Land Acquisition Act, 1894 (hereinafter referred to as 'Act, 1894') at the instance of UPSIDC and the same was transferred to it. 4. UPSIDC acquired aforesaid land for the purpose of setting up an industrial area. Acquired land was sub-divided into plots for industrial units. These plots were allotted and leased out to Entrepreneurs for establishing industrial units. Disputed plot came to be allotted and let out to one M/s Graft Speciality Polymers Private Limited (hereinafter referred to as 'M/s GSPPL') having its registered office at 42, Nehru Nagar, Agra vide lease dated 23.08.1984 registered on 24.08.1984 for the purpose of establishing an industrial unit. The aforesaid allottee, it appears, obtained certain loan from UP Financial Corporation (hereinafter referred to as 'UPFC') and Pradeshiya Investment Corporation of U.P. (hereinafter referred to as 'PICUP'). UPFC loaned Rs. 30 Lac and PICUP loaned Rs. 59.50 lacs to M/s GSPPL. Loan agreement was executed on 14.12.1984. A joint equitable mortgage was created on 14.12.1984 at PICUP by deposit of title deed (lease deed) dated 25.08.1984. 5. The aforesaid borrower M/s GSPPL committed default as a result whereof UPFC and PICUP initiated recovery proceedings under Section 29 of State Financial Corporation Act, 1951 (hereinafter referred to as 'SFC Act, 1951') against M/s GSPPL and also took possession of disputed plot on 17.09.1991 in exercise of powers under Section 29 of SFC Act, 1951. The sale of disputed land and building mortgaged to UPFC and PICUP were finalized vide sale deed dated 24.02.1998 with following: (1) Sri Narayan Das Agarwal S/o Sri Ganeshi Lal (2) Sri Madhav Das Agarwal S/o Sri Ghan Shyam Das Agarwal (3) Sri Sanjay Kumar Agarwal S/o Sri Ghan Shyam Das Agarwal (4) Smt. Abha Garg W/o Sri Sanjay Kumar Agarwal (5) Smt. Hem Lata Garg W/o Sri Madhav Das Agarwal 6. The sale deed was executed between UPFC and PICUP as vendors and aforesaid five persons as vendees for a consideration of Rs. 35.20 lacs in respect to the land in dispute so as to transfer freehold rights of the building standing on the land in dispute and lease hold rights of the said land. Copy of aforesaid deed is Annexure No. 1 to writ petition. The deed further stipulates that from the date of its execution borrower i.e. M/s GSPPL would have no right, title and interest in aforesaid property. 7. It is further mentioned in sale deed dated 24.02.1998 that physical and vacant possession of land and building detailed above was already given to vandees on 18.08.1997 and after execution of sale deed they would be entitled to enjoy property for industrial purposes subject to obligations as contained in lease deed dated 24.08.1984 executed between borrower M/s GSPPL and UPSIDC. 8. It further appears that out of aforesaid five vendees, four of them, namely, Madhav Das Agarwal, Sanjay Kumar Agarwal, Hemlata Garg and Abha Rani Garg constituted a partnership firm, namely, M/s G.D. Engineer and Associates and requested UPSIDC to execute a fresh lease deed of land in dispute to which it appears that UPSIDC agreed and a lease deed dated 28.12.1999 was executed between UPSIDC and M/s GD Engineers and Associates through its partner Madhav Das Agarwal. A photocopy of this deed has been placed on record at page 42 to 53 of paper book of writ petition. The tenure of lease was 75 years commencing from 07.12.1999. Yearly rent was Rs. 7,456.20 per year revisable after expiry of every 30 years. Para 3(e) of lease deed required lessee to complete its manufacturing and production unit and start same within six months from the date of deed or within such extended period as may be allowed by lessor in writing. Same condition was reiterated in clause 3(q) with further clarification that extension of time for putting building to use shall not be admissible except where in opinion of lessor delay is caused for reason beyond control of lessees. Clause 6 also says that earlier land in dispute was leased out to M/s GSPPL vide lease dated 23.08.1984 registered on 24.08.1984 but that lease has been determined and forfeited by UPSIDC. Clause 4(h) provides that lessees shall bear stamp and registration charges of lease deed. Clause 6 also says that earlier land in dispute was leased out to M/s GSPPL vide lease dated 23.08.1984 registered on 24.08.1984 but that lease has been determined and forfeited by UPSIDC. Clause 4(h) provides that lessees shall bear stamp and registration charges of lease deed. It is not in dispute before us that aforesaid lease deed dated 28.12.1999 required registration compulsorily under provisions of Registration Act, 1908 (hereinafter referred to as 'Act, 1908'). 9. It appears that petitioner-lessees intended conversion of use of some part of disputed land from industrial to commercial and moved an application on 16.08.2000 for said purpose. Regional Manager, UPSIDC vide letter dated 26.12.2000 informed petitioner that it should obtain no objection certificate from Mathura Vrindavan Development Authority (hereinafter referred to as 'MVDA') so that further action or subdivision of disputed plot be processed. Petitioner vide letter dated 18.07.2001 informed UPSIDC that MVDA is of the view that land belongs to UPSIDC who has entire rights and powers thereon and MVDA has no role in this matter. Petitioner further requested that conversion of entire plot as commercial be allowed. 10. Having no response from UPSIDC, petitioner sent a reminder dated 24.08.2001. Regional Manager, UPSIDC made recommendation to UPSIDC Headquarter at Lucknow for such conversion as requested by petitioner subject to condition that in future petitioner shall obtain no objection certificate from MVDA. Petitioner again sent a letter dated 07.09.2003. UPSIDC vide letter dated 22.03.2003 allowed such conversion permitting utilization of plot as commercial by establishing a service station. Thereafter petitioner submitted another letter dated 07.09.2003 conveying that it wants to utilize entire plot as commercial for raising a showroom and facility centre and requested permission for such change expressing its willingness to pay entire conversion charges for this purpose. Regional Manager again made a recommendation to UPSIDC Headquarter vide letter dated 15.09.2003 pointing out that change of use from industrial to commercial is permissible after charging one and half times of current premium from lessee. The petitioner then was required to appear before General Manager, Development on 22.12.2003 along with his plan. Petitioner visited office of General Manager as directed. Thereafter having received no response, it sent a letter dated 20.01.2004 to Minister, Industrial Development seeking his intervention in the matter. 11. The petitioner then was required to appear before General Manager, Development on 22.12.2003 along with his plan. Petitioner visited office of General Manager as directed. Thereafter having received no response, it sent a letter dated 20.01.2004 to Minister, Industrial Development seeking his intervention in the matter. 11. It appears that as a matter of fact UPSIDC vide letter dated 20.01.2004 already informed petitioner that conversion as requested by him was not permissible. Petitioner further insisted upon his request and then came to this Court in Writ C No. 29205 of 2015 which was disposed of vide order dated 21.05.2015 directing Regional Manager, UPSIDC to consider petitioner's application dated 09.03.2015 and pass appropriate order in accordance with law. It is pursuant thereto impugned order dated 10.12.2015 has been passed by UPSIDC stating clearly that petitioner has committed breach of the conditions of lease and, therefore, UPSIDC is determining lease. 12. Learned counsel for petitioner contended that before terminating lease deed no notice has been issued by respondent UPSIDC and in any case there is no violation of terms of lease. Arguments advanced by counsel clearly shows that dispute relates to a contractual matter arising from a lease deed between petitioner and UPSIDC in respect to land in dispute. Remedy, therefore, lies in common law by filing a suit and writ petition is, therefore, not entertain able on account of availability of statutory efficacious alternative remedy in common law. 13. Petitioner's rights are founded on a contract and once contract has already come into existence, against any action in accordance with its stipulation, no writ under Article 226 of Constitution would lie so as to entitle a party to the contract for continuance or non-continuance of contractual obligation. In the similar circumstances, in Bareilly Development Authority vs. Ajai Pal Singh, AIR 19869 SC 1076, Court said as under:- “Thus the factual position in this case clearly and unambiguously reveals that the respondents after voluntarily accepting the conditions imposed by the BDA have entered into the realm of concluded contract pure and simple with the BDA and hence the respondents can only claim the right conferred upon them by the said contract and are bound by the terms of the contract unless some statue steps in and confers some special statutory obligations on the part of the BDA in the contractual field. In the case before us, the contract between the respondents and the BDA does not contain any statutory terms and/ or conditions.” 14. The Court also said that decision in Ramanna Dayaram Shetty Vs. The International Airport Authority of India and others AIR 1979 SC 1628 would have no application since there was no concluded contract in that case. Even if Bareilly Development Authority has trappings of a State or would be comprehended in 'other authority' for the purpose of Article 12 of the Constitution, while determining price of the houses/flats constructed by it and the rate of monthly instalments to be paid, the 'authority' or its agent after entering into the field of ordinary contract acts purely in its executive capacity. Thereafter the relations are no longer governed by the constitutional provisions but by legally valid contract which determines rights and obligations of the parties inter-se. The court said that writ petition, therefore, would not lie under Article 226 of the Constitution. Facts in that case were also similar as are involved in present writ petition. Bareilly Development Authority also revised rates and demanded difference from allottees in accordance with law in terms and conditions of allotment. The Court said that if there is a dispute in terms and conditions of contract, remedy lies in common law and not by filing of writ petition under Article 226 of the Constitution of India. Similar view has been taken in similar other authorities also. Where a contract is not governed by statutory provisions, it is well-settled that contract can neither be enforced nor one can escape liability therein by filing a writ petition. 13. The petitioner, therefore, has remedy in common law regarding alleged breach of contract but such relief cannot be enforced by way of writ petition under Article 226 of the Constitution. 17. In view of above, the writ petition is dismissed.