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2025 DIGILAW 11 (KAR)

Bogineni Hospitality India Private Limited v. Karnataka Industrial Areas Development Board (KIADB)

2025-05-02

M.NAGAPRASANNA

body2025
ORDER : 1. The petitioner, a company registered under the Companies Act, 2013 is before this Court calling in question an order dated 15-06-2024 by which allotment of Plot No.61-P to the extent of one acre in Hi-tech Defence and Aerospace Park (IT-Sector), Bengaluru, coming within the precincts of the Karnataka Industrial Areas Development Board (hereinafter referred to as ‘the Board’ for short)in favour of the petitioner, stands cancelled. 2. Heard Sri K.N. Phanindra, learned senior counsel appearing for the petitioner and Sri K.Shashikiran Shetty, learned Advocate General appearing for the respondent. 3. Facts, in brief, germane are as follows:- The petitioner initially operated as M/s.Infinity Enterprises - a proprietorship concern, and while so operating, it has received a communication from the respondent/Board on 01-10-2009 that the project proposal of M/s.Infinity Enterprises to establish service apartments was accepted and a decision was taken to allot 1 acre of land in its favour. In terms of the said communication M/s.Infinity Enterprises was required to file an application with the Board and make initial deposit to the Board. Accordingly, M/s.Infinity Enterprises submits an application to the Board seeking allotment of land in its favour. Thereafter, M/s.Infinity Enterprises, proprietorship concern was converted as a partnership concern with two partners. Thus, the name comes to be changed and registered as M/s. Bogineni Enterprises. The change is said to have been intimated to the Board / Karnataka Udyog Mitra in terms of its communication dated 09-03-2011. After which, the present set up sought allotment of plot Nos.100 and 101 in the said area to establish service apartments, on 28-09-2012. Along with the communication the petitioner is said to have remitted Rs. 36/- lakhs towards initial cost of the allotment. Once again, there appears to be a change in the formation of the petitioner. The partnership concern is now converted into private limited company, the present petitioner. The said change is also said to have been communicated to the Board, on 12-12-2012. In turn, a communication comes about on 05-03-2013 that the project of the petitioner was pending consideration before the State Level Single Window Clearing Committee and requested the Company to be present at the meeting and deliberations to be held on 08-03-2014. The said change is also said to have been communicated to the Board, on 12-12-2012. In turn, a communication comes about on 05-03-2013 that the project of the petitioner was pending consideration before the State Level Single Window Clearing Committee and requested the Company to be present at the meeting and deliberations to be held on 08-03-2014. Pursuant to the deliberations, it appears that on 26-06-2014, allotment letter was issued in favour of the present set up of plot No.61P in the Bengaluru IT Park near BIAL, measuring 1 acre for setting up of a Hotel. The petitioner again knocked at the Board to issue allotment letter in favour of the present petitioner, on 01-07-2014. In response thereto, the Board is said to have approved the change of name, on 13-11-2014. But, with regard to lease period, it was intimated that after coming into force of the new policy of the Government, it would be intimated. 4. In terms of the communication dated 28-02-2015, intimation is now made to the petitioner that the period of lease in terms of the aforesaid allotment was 99 years. The petitioner then submits a representation on 16-03-2015, seeking allotment of land on lease-cum-sale basis for a period of 10 years and also places on record details of remittances made by it, prior to coming into force of the new policy. The petitioner also requested to complete all the infrastructure activities in the IT park so that banks would be in a position to render financial assistance. Communications between the two i.e., the petitioner and the Board galore. The petitioner then approached this Court in Writ Petition No.13688 of 2015, wherein a deposit of Rs. 72/- lakhs was directed to be made and was made. It is thereafter, in a communication dated 26-06-2020 of the Board, the petitioner was directed to pay Rs. 1,46,69,932/- towards balance cost of the plot on or before 30-07-2020. The petitioner replies intimating the change of address and further requested time to make the payment. Payment is not made and intimation letter dated 15-06-2024 comes about to the petitioner that it has failed to make payment and, therefore, the allotment would stand cancelled. The petitioner then replies to the impugned intimation on 16-07-2024 that it is willing to make the balance payment immediately. Payment is not made and intimation letter dated 15-06-2024 comes about to the petitioner that it has failed to make payment and, therefore, the allotment would stand cancelled. The petitioner then replies to the impugned intimation on 16-07-2024 that it is willing to make the balance payment immediately. This is not acceded to by the Board and therefore, the petitioner is before this Court in the subject petition. 5. The learned senior counsel Sri K.N. Phanindra appearing for the petitioner contends that the impugned intimation is contrary to Section 34B of the Karnataka Industrial Areas Development Act , 1966 (hereinafter referred to as ‘the Act’ for short). It is his submission that this Court in several judgments has upheld the requirement of issuance of notice prior to cancellation of allotment. The notice is, admittedly, not issued or served in the case at hand. Therefore, his submission is that, it is in violation of not only the statute but the principles of natural justice. The learned senior counsel submits that within one month from the date of the impugned intimation, the petitioner has requested that the balance amount would be paid immediately and has also projected bona fide reasons for not making payment within time. On all these grounds, the petitioner seeks quashment of the impugned intimation letter and a direction to permit the petitioner to make payment for the allotment. 6. Per contra, the learned Advocate General representing the Board would vehemently refute the submissions in contending that Section 34B of the Act becomes applicable only in cases where the allotment is complete and possession is handed over. In the case at hand, there has been gross default on the part of the petitioner and it has been only in communications for the last 14 years. It is no doubt true that the petitioner has paid certain amount but that would not absolve the responsibility of complying with the conditions of allotment. He would seek to place reliance upon judgment of the Division Bench of this Court in Writ Appeal No.533 of 2021, disposed on 19.08.2021, which holds that breach of conditions in the allotment letter is fatal to the allottee. 7. I have given my anxious consideration to the submissions made by the respective learned counsel and have perused the material on record. 8. The afore-narrated facts are not in dispute. 7. I have given my anxious consideration to the submissions made by the respective learned counsel and have perused the material on record. 8. The afore-narrated facts are not in dispute. The change of status of the petitioner from time to time on several occasions is a matter of record. The story commences on 01-10-2009 when the erstwhile M/s Infinity Enterprises had sought allotment and was allotted particular piece of land for construction of a Hotel. Due to change in the holding of the petitioner, a fresh allotment letter is issued on 25-06-2014. A few of the conditions which are germane to be noticed read as follows:- “No.KIADB/HO/Allot/AS/18965/4286/14-15 Date:25-06-2014. M/s Bogineni Enterprises, No.87/2A & 87/3, ‘Nikhil Indraprastha’ Whitefield Hoskote Road, Seegehalli, Bengaluru-560 067. ALLOTMENT LETTER Sirs, Sub: Allotment of one acre of land in Plot No.61-P of Bengaluru IT Park near BIAL, Bengaluru. Ref: 1. SLSWCC Meetings dated 29-08-2009 & 10.07.2013 2. Your application dated 06-04-2010. Xxxx Xxxx Xxxx 3(a) The tentative premium of the land and lease rents shall be paid as follows: i) A sum of Rs. 18,00,000=00 being the balance 30% of the tentative premium of land shall be paid within 30 days from the date of issue of this letter i.e., on or before 24-07-2014. ii) A sum of Rs. 1,26,00,000=00 being the balance tentative premium of land shall be paid within 90 days from the date of issue of this letter i.e., on or before 24-09-2014. Xxxx Xxxx Xxxx 4. This allotment letter will be valid only for a period of 30 days from the date of its issue and in the event of failure to pay the amount indicated at para-3 (a)(i), the allotment stands automatically cancelled and E.M.D. paid stands forfeited. 5(a) In case of your failure to pay the amount mentioned at para 3(a)(ii) before the expiry of the time stipulated therein, this offer of allotment stands automatically cancelled and the Earnest Money Deposit and 10% of the amount paid by you towards premium stands automatically forfeited. 5(b) If the balance premium is not paid within 90/150 days from the date of execution of lease agreement in respect of cases mentioned at para 3(b), the plot would be resumed on expiry of the time stipulated without issuing any fresh notice. 6. 5(b) If the balance premium is not paid within 90/150 days from the date of execution of lease agreement in respect of cases mentioned at para 3(b), the plot would be resumed on expiry of the time stipulated without issuing any fresh notice. 6. Soon after receipt of the payment of 100% tentative premium and, on your acceptance of all the terms and conditions indicated herein before and also those mentioned hereinafter, the possession of land will be handed over within 30 days from the date of payment and at the time of taking over possession you should produce the original receipt, issued for the payment made, to the Engineer in charge of the area. Xxxx Xxxx Xxxx 9. The cancelled allotment or the resumed plot shall be restored, only after payment of premium at the rate/rates prevailing at the time of considering such requests provided the request in writing for such restoration is received within one month from the date of cancellation of allotment or resumption. Any requests received after the expiry of 30 days from the date of cancellation/resumption of land will be rejected.” (Emphasis added) The conditions of allotment also indicated that failure to pay the amount as directed in condition No.3 therein before the expiry of the time stipulated, this offer of allotment would stand automatically cancelled and the E.M.D. paid would be forfeited. 9. In terms of condition 3(a), Rs. 18/- lakhs is to be paid and the balance within 30 days, all of which should be completed within 24-09-2014. The petitioner on change of its constitution again seeks fresh allotment letter. Pending consideration of the said allotment letter, the petitioner had to knock at the doors of this Court in Writ Petition No.13688 of 2015 along with several connected cases, wherein mandamus was sought for allotment of plots and questioning certain demands made. This Court disposed of the writ petitions on 20.11.2015, by the following order: “ORDER These petitions are considered for final disposal at this stage, having regard to the assurance of the respondents that it could be possible to allot the plots after providing all infrastructural facilities which is the subject matter of controversy in all these petitions, within a period of two months from today. However, it is the demand of the respondents that this is feasible only if the petitioners come forward and pay the entire amount of the allotment price demanded. 2. The controversy arose in view of the fact that the Karnataka Industrial Areas Development Board (hereinafter referred to as ‘the KIADB’ for brevity) had proposed to sell industrial plots in favour of the petitioners. Subsequently, however, in view of a change in policy, the respondents have now proposed only to execute a lease deed for a period of 99 years in favour of the petitioners. It is primarily this change in the policy which is the subject matter of challenge in these petitions. 3. It is not in dispute that there is no agreement of sale executed by the KIADB in favour of the petitioners. It is only a proposal, against which an advance of 20% of the allotment price reserved for was already paid by the petitioners along with their application in the year 2010. The project has however not taken off over the years for want of funds, or for other reasons. 4. The learned Senior Advocate Shri Vijayashankar appearing for the counsel for the respondent submits that it would be possible for the respondents to carry out and complete the establishment of the industrial layout with expedition only if the petitioners pay the remaining amount. 5. However, Shri Ravi B. Naik, learned Senior Advocate appearing for the counsel for the petitioners would point out that it was proposed to sell the plots in favour of the petitioners against which they had paid a substantial advance of 20% of the allotment price. It is after five years down the line that the respondents have now changed their stance in claiming that there can only be a long lease. Therefore, the petitioners have been denied a valuable right which was assured to them on the basis of which they had paid the advance. It is after five years down the line that the respondents have now changed their stance in claiming that there can only be a long lease. Therefore, the petitioners have been denied a valuable right which was assured to them on the basis of which they had paid the advance. The admitted position that the respondents would still require time to complete and hand over the plots even on a long lease, only if the petitioners make the payment, does not evoke the confidence of the petitioners, as they are not certain of any such development taking place within a short period of two months, when no such progress has been shown for the past five years and hence, he would submit that the respondents ought to be directed to complete the formation of the industrial plots and identify the plots that would be allotted to each of the petitioners before any further proposal for payments can be made. 6. However, as pointed out by the learned Senior Advocate Shri Vijayashankar, if the Board lacks funds to complete the formation of the layout, the only source that the Board can look forward to is the payment of the balance amount. It would stand to reason if the petitioners pay at least part of the amount. It is seen that the original sale price or allotment price fixed is the same as contemplated for the long lease which is now proposed. Since 20% of the same has already been paid, it would be reasonable to expect the petitioners to pay 50% of the remaining 80%, within a period of 15 days. On the respondents completing formation of the industrial layout and on identifying plots to be allotted to each of the petitioners, the petitioners on being called upon to pay the remaining amount, shall pay the same and the respondents shall simultaneously execute lease deeds and hand over possession of the respective plots. In the expectation that his schedule would be adhered to, the petitions stand disposed of.” (Emphasis supplied) The petitioner then files an appeal against the said order in Writ Appeal No.4874 of 2015, which comes to be disposed on 07.06.2019, by the following order: “2. In the expectation that his schedule would be adhered to, the petitions stand disposed of.” (Emphasis supplied) The petitioner then files an appeal against the said order in Writ Appeal No.4874 of 2015, which comes to be disposed on 07.06.2019, by the following order: “2. It is the ground taken by the appellant that primarily the lease was allotted for a period of 10 years and at the end of 10 years the lease would be converted into a sale, subject to fulfillment of all terms and conditions of allotment, lease-cum-sale agreement and payment of price in full. Instead, the Government passed an Order by extending the lease period from 10 years to 99 years, which is arbitrary and contrary to the provisions of KIADB. 3. Learned counsel for KIADB filed a memo during pendency of this writ appeal that the Government has taken a decision, which is culminated in the Government Order No.CI 105 SPI SPQ 2017 dated 11.07.2017 extending lease period from 10 years to 99 years. However, it is a condition that the Government Order applies to micro, small and medium industries, who are allotted above 2 acres of land on lease-cum- sale basis. In the present appeal, the extent of land is two acres and thus, excluded from the Government order. Hence, this appeal is liable to be rejected. 4. It is found, lease period was reduced to original position from 99 years to 10 years since the land allotted is two acres. Hence, we find that this appeal has become infructuous. Accordingly, the appeal is dismissed as having become infructuous. 5. If the lease amount is already deposited by satisfying the condition prescribed by the KIADB, KIADB shall pass appropriate order and execute lease-cum-sale deed. The Government Order is applicable to the cases where an extent of land is more than 2 acres of land allotted i.e., in WA No.4884/2015 by M/s. DRK enterprises, WA No.4909/2015 by M/s. Standard Properties and W.A No.4889/2015 by M/s. G7 Investments Private Limited where the extent of land allotted is 4 acres.” (Emphasis supplied) It was observed by the Division Bench that the Government order excludes land which was less than two acres. During the pendency of the writ appeal, a communication along with certain payment is made by the petitioner. The communication reads as follows: “BOGINENI HOTELS To Date: 21-12-2015. The CEO & EM, KIADB, Bangalore-560 001. During the pendency of the writ appeal, a communication along with certain payment is made by the petitioner. The communication reads as follows: “BOGINENI HOTELS To Date: 21-12-2015. The CEO & EM, KIADB, Bangalore-560 001. Dear Sir, Sub: Payment towards plot No.61P at IT/ITES Industrial Area, Devanahalli, Bangalore Rural District. Ref: 1. No.KIADB/HD/ALLOT/A5/18965/4286/14-15 Dated 25-06-2014 2. Hon’ble High Court order 7/12/2015 WA 4874/2015. -- With reference to above, we wish to bring to your notice that KIADB has allotted Plot No.61P measuring ONE acre of land at IT/ITES Park, KIADB Industrial Area, Devanahalli Taluk, Bangalore Rural District for our project proposal to establish “HOTEL”. The Hon’ble High Court in its Writ Appeal WA 4874 of 2015 dated 07-12-2015 has directed us to deposit the balance 50% of the remaining 80% of the consideration within 15 days from the order, for the Plot Allotted to us by KIADB at IT/ITES Park, KIADB Industrial Area, Devanahalli Taluk Bangalore Rural District for our project proposal to establish “IT Park”. As per the Hon’ble High Court order 7-12-2015 WA 4874 of 2015 we have transferred a sum of Rs. 72,00,000/- (Seventy two lakhs only) being 50% of the remaining 80%. Kindly accept the payment of Rs. 72,00,000/- (Seventy two lakhs only) through RTGS reference No. HDFCR52015122171950644 from HDFC Bank done on 21-12-2015.” (Emphasis added) The Board then replies to the communication after disposal of the writ appeal seeking balance payment from the hands of the petitioner on 26-06-2020. The petitioner replies immediately on14-09-2020. The reply of the petitioner reads as follows: “ BOGINENI To September 14, 2020. The Secretary-I, KIADB, Khanija Bhavan, Bangalore. Sir, Sub: Request for extension of time and change of address. Ref: Your letter dated 26-06-2020 bearing No.KIADB /HO/Allot/SecyI/18965/2669/2020-21 -- With reference to the above this is to bring to your notice that we have shifted our office to Seegehalli, Whitefield, Bengaluru, hence, we received the letter dated 26-06-2020 issued by your good office on 11-09-2020. Please find below our present address. BOGINENI HOSPITALITY INDIA PRIVATE LIMITED “BOGINENI BLACK” No.87/2A & 87/3, SH-35, Seegehalli, Whitefield – Airport Road, Bangalore-560 067, Karnataka, INDIA. Request you to take note of the address mentioned above and update your records accordingly. Please find below our present address. BOGINENI HOSPITALITY INDIA PRIVATE LIMITED “BOGINENI BLACK” No.87/2A & 87/3, SH-35, Seegehalli, Whitefield – Airport Road, Bangalore-560 067, Karnataka, INDIA. Request you to take note of the address mentioned above and update your records accordingly. Further, in connection with the remittance of the balance cost along with interest, we request you to grant us time till March 31, 2021 to make the payment of the balance amount and also waive/reduce the interest imposed, considering that the pandemic (COVID-19) situation has caused great loss to the Hospitality industry. Please consider our request and do the needful.” (Emphasis added) Time was sought to make the payment of Rs. 1,46,69,932/-. Four years passed by, not a single rupee is paid during that period. The communication then comes from the Board to the petitioner on 06-07-2024 seeking to cancel the allotment. The communication reads as follows: “No.KIADB/HO/Allot/18965/6123/2024-25 Date:06-07-2024 M/s. Bogineni Hospitality India Pvt.Ltd., Bogineni Black, No.87/2A & 87/3, SH-35, Seegehalli, Whitefield-Airport Road, Bengaluru-560 067. Sir, Sub: Cancellation of allotment of 1.00 acre land in Plot No.61-P of Hi-tech, Defence & Aerospace Part (IT Sector), Bengaluru Urban District for non-payment of balance tentative cost of land. Ref: This office letter No.IADB/HO/Allot/18965/4981/2023-24, dated 15-06-2024. -- With reference to the above, a intimation letter regarding cancellation of allotment of 1.00 acre land in Plot NO.61-P of Hi-tech Defence & Aerospace Park (IT Sector), Bengaluru Urban District for non-payment of balance cost of land has been served by this Board on 15-06-2024 vide letter cited at reference above, the said letter was addressed to “M/s Bogineni Hospitality India Private Limited, Corporate Office, No.429, Krishna Temple Road, Indiranagar 1 st Stage, Bengaluru-560 038”. But it is returned undelivered by the postal authorities stating that “no such person in this address”. Hence, the said undelivered letter is enclosed herewith &sent to the alternative address available in the file. This is for your information.” (Emphasis added) The petitioner then replies seeking time stating that the delay is due to unforeseen circumstance. The communication reads as follows: “ BOGINENI To Date: 16.7.2024 The Chief Executive Officer & Executive Member, Karnataka Industrial Areas Development Board, 4 th Floor, Khanija Bhavan, East Wing, Race Course Road, Bangalore-560 001. Sir, Sub: Balance payment for allotted land in Hi-Tech, Defence & Aerospace Park (IT Sector). Ref: Your letter No.IADB/HO/Allot/1865/4981/2023-24 dated 15-06-2024. The communication reads as follows: “ BOGINENI To Date: 16.7.2024 The Chief Executive Officer & Executive Member, Karnataka Industrial Areas Development Board, 4 th Floor, Khanija Bhavan, East Wing, Race Course Road, Bangalore-560 001. Sir, Sub: Balance payment for allotted land in Hi-Tech, Defence & Aerospace Park (IT Sector). Ref: Your letter No.IADB/HO/Allot/1865/4981/2023-24 dated 15-06-2024. -- We acknowledge receipt of your letter dated 15-06-2024, which we received today (15-07-2024), regarding the balance payment of Rs. 1,46,69,932/- for the 1.00 acre land allotted in Plot No.61 of Hi-Tech, Defence & Aerospace Park (IT Sector)Bengaluru urban District. Due to unforeseen reasons, there was a delay in making the payment. Now we are ready to make payment towards the balance land cost and implement the project immediately. Hence, kindly consider our request and provide us with an opportunity to implement the project. Thanking you, Sd/- Sincerely, For Bogineni Hospitality India Pvt. Ltd.” (Emphasis added) What is discernible from the afore-quoted communication is that, the petitioner was to pay Rs. 1,46,69,932/- on or before 30 th July, 2020. Four years passed by, not a rupee is paid. The Board left with no choice cancels the allotment. The delay in payment is accepted by communication by which time is sought. The contention of the petitioner is that, there was no notice served upon the petitioner. The intimation dated 15-06-2024 reads as follows: “No.IADB/HO/Allot/18965/4981/2023-24 Date:15-06-2024 M/s.Bogineni Hospitality India Pvt.Ltd., No.429, Krishna Temple Road, Indiranagar 1 st Stage, Bengaluru -560 038. ::INTIMATION:: Sir, Sub: Allotment of 1.00 acre land in Plot No.61-P of Hi-Tech, Defence & Aerospace Park, (IT Sector), Bengaluru urban District. Ref: 1. This office Allotment letter No.KIADB/HO/ Allot/AS/18965/4209/2014-15, dtd: 15-06-2024. 2. This office letter No.KIADB/HO/Allot/ Secy-1/18965/2669/2020-21 dtd: 26.06.2020 -- As per the letter dated 26-06-2020 cited at ref (2) above, you were expected to remit a sum of Rs. 1,46,69,932/- towards balance tentative cost of land, interest and slum improvement cess in respect of 1.00 acres of land allotted in Plot No.61-P of Hi-tech, Defence & Aerospace Park (IT Sector), Bengaluru urban district on or before 30-07-2020. However, so far, you have not remitted the same. Hence, the allotment stands automatically cancelled as per clause (4) of allotment letter dated 25-06-2014. This is for your information. Yours faithfully, Sd/- Chief Executive Officer & Executive Member.” (Emphasis added) The intimation was clear that remittance of Rs. 1,46,69,932/- should be paid on or before 30-07-2020. However, so far, you have not remitted the same. Hence, the allotment stands automatically cancelled as per clause (4) of allotment letter dated 25-06-2014. This is for your information. Yours faithfully, Sd/- Chief Executive Officer & Executive Member.” (Emphasis added) The intimation was clear that remittance of Rs. 1,46,69,932/- should be paid on or before 30-07-2020. Even that is not availed of by the petitioner. 10. The petitioner now seeks to contend that the action is in violation of Section 34B of the Act. Section 34B of the Act reads as follows: “ 34B. Resumption of the possession of premises including the residential tenements on breach of terms and conditions of lease or holding without authority : (1) Where the Board is of the opinion that an allottee of any premises or part thereof or residential tenement in an industrial area or industrial estate has violated any of the terms or conditions of allotment or holds it without any authority it may, without prejudice to section 25 give notice to such allottee and Banks or Financial Institutions, in whose favour the Board has permitted the mortgage or leasehold rights of the premises, or residential tenement specifying the breaches of the terms and conditions of the allotment calling upon the allottee to remedy such breaches within a time stipulated in the notice. (2) If the allottee fails to remedy the breaches within the time so stipulated, the Board shall serve a notice upon the allottee under intimation to such Bank or Financial Institutions to show cause within thirty days from the date of service of notice, why the possession of the premises or part thereof or residential tenement should not be resumed. (3) After considering the cause, if any, shown by the allottee and after giving him an opportunity of being heard, the Board may pass such orders, as it deems fit. (4) Where the Board passes an order under sub- section (3), for resuming possession of the premises or part thereof or residential tenement in the industrial area it may, by notice in writing, order any allottee to surrender and deliver possession thereof to the Board or any person duly authorised in this behalf within the date specified in the notice. (4) Where the Board passes an order under sub- section (3), for resuming possession of the premises or part thereof or residential tenement in the industrial area it may, by notice in writing, order any allottee to surrender and deliver possession thereof to the Board or any person duly authorised in this behalf within the date specified in the notice. (5) If any allottee refuses to surrender or deliver the possession of the premises or part thereof or residential tenement within the time specified in the notice, the Board or any officer authorised by it in this behalf may resume the possession of the premises or part thereof or residential tenement free from all encumbrances and for that purpose may use force as may be necessary.” (Emphasis supplied) Section 34B deals with resumption of possession of premises including the residential tenements on breach of conditions of lease. 11. Section 34B of the Act is clear that it deals with resumption of possession of the premises on breach of terms and conditions of lease. Therefore, two circumstances must be present to invoke Section 34B – one possession should be handed over to the allottee and there must be a lease deed executed in his favour. When such lands are resumed by the Board on breach of conditions of lease, it is then the contention that Section 34B of the Act becomes mandatory would spring. In the case at hand, it is still at the stage of making payment and the petitioner is dragging the feat to pay Rs. 1,46,69,932/- for the last 9 years or atleast for the last 5 years. In such circumstance it becomes apposite to refer to the judgment of the Division Bench in the case of M/s Imperial Constrafin Pvt. Ltd. v. Chief Executive Officer and Executive Member, KIADB, W.A. No. 533 of 2021 decided on 19th August 2021. The Division Bench has held as follows: “…. …. ….. 6. Perused the order under challenge. It would be useful for this Court to refer to the clauses in the allotment letter which reads as under: "3(a) The premium of the land shall be paid as follows: i) A Sum of Rs. NIL being the balance 30% of the tentative premium of land shall be paid within 30 days from the date of issue of this letter ie on or before NIL. NIL being the balance 30% of the tentative premium of land shall be paid within 30 days from the date of issue of this letter ie on or before NIL. ii) A sum of Rs.8,57,50,000-00 being the balance tentative premium of land shall be paid within 90 days from the date of issue of this letter ie on or before 05.12.2017. b) In the event of your furnishing letter of commitment from KSFC/KSIIDC/Reserve Bank of India approved Financial Institutions/Corporations/Companies agreeing topay the premium indicated at 3(a)(2) directly to the Board (applicable only to Medium, Small and Micro Enterprises) the allotment will be confirmed and documentation will be permitted subject to payment of Interest @ 10% per annum on amount due from the date of handing over possession of land to the date of payment which should be made within 180 days from the date of execution of lease agreement. c) You should pay lease rent of Rs.1000/- per acre/per annum. d) You should pay maintenance charges as may be fixed by the Board from time to time. e) Interest at 10% per annum shall be levied in case the lease rents are not paid within one month from the date on which the lease rents fall due every year. 4(a) In case of your failure to pay the amount mentioned at Para 3(a)(2) before the expiry of the time stipulated therein, this offer of allotment stands automatically cancelled and the Earnest Money Deposit and 20% of the amount paid by you towards premium stands automatically forfeited. 4(b) If the balance premium is not paid within 90 days from the date of execution of lease agreement in respect of cases mentioned at Para3(b), the plot would be resumed on expiry of the time stipulated without issuing any fresh notice." 7. On perusal of 4(a) of the allotment letter, it is quite evident that on failure to pay the balance premium amount, the offer of allotment stands automatically cancelled and under clause 4(b), the plot would automatically stand restored with the 2 nd respondent- Board. The above said two clauses would clearly indicate that in the event of breach, the allotment stands automatically cancelled. Therefore, the contention of the appellant that he was not notified before communicating the cancellation cannot be acceded to. 8. We have also examined the statement of objections filed by respondents 1 and 2. The above said two clauses would clearly indicate that in the event of breach, the allotment stands automatically cancelled. Therefore, the contention of the appellant that he was not notified before communicating the cancellation cannot be acceded to. 8. We have also examined the statement of objections filed by respondents 1 and 2. The appellant was required to pay the balance tentative premium on 5.12.2017. The 2 nd respondent even after expiry of period kept on communicating to the 4 th respondent-Bank to deposit the balance premium of Rs.8,84,51,712/- along with interest at the rate of 12%. The first communication was sent on 28.4.2017. The 2 nd communication was sent on 2.3.2018. If 4 th respondent-Bank was insisting for NOC from the 2 nd respondent-Board for release of the amount, then it was incumbent on the part of the appellant to negotiate and convince his banker to release the amount. The appellant cannot expect an authority to issue NOC before receiving the balance premium. Therefore, we are of the view that no fault can be found with respondents 1 and 2. The learned Single Judge has dealt with the matter and has rightly dismissed the writ petition. This Court has taken note of the fact that the authorities were quite lenient and had extended time even after expiry of the statutory period prescribed under clause 3(a)(ii) of the allotment letter. The appellant was not able to deposit the balance premium amount even in 2018 which is evident from the two communications dated 28.4.2017 and 2.3.2018. Further, this Court has also taken note of the fact that respondents 1 and 2 have allotted the site to a 3 rd party after cancellation of allotment in favour of the appellant.” (Emphasis supplied) The Division Bench holds that in cases where lease is yet to come about, what would govern is the terms of allotment. Identically in the case at hand condition No.3(a) has certain terms of allotment. Payment of the amount had to be fulfilled within 24.09.2014. Ten years thereafter the impugned order is passed. If at all anybody is responsible in the case at hand for the impugned action, it is the petitioner itself for dilly-dallying in making payment. 12. Identically in the case at hand condition No.3(a) has certain terms of allotment. Payment of the amount had to be fulfilled within 24.09.2014. Ten years thereafter the impugned order is passed. If at all anybody is responsible in the case at hand for the impugned action, it is the petitioner itself for dilly-dallying in making payment. 12. In identical circumstances, following the judgment of the Division Bench quoted supra, this Court in W.P.No.279 of 2024 disposed on 12-01-2024, has held as follows: “…Section 34B mandates resumption of possession from the hands of an allottee. Possession would be handed over to the allottee only after execution of a lease-cum- sale agreement and issuance of possession certificate by the Board. Those events are yet to come about, as the petitioner is yet to make good the entire amount in terms of allotment letter itself. The entire Section 34B unequivocally depicts that if the allottee fails to adhere to the conditions of lease hold rights, possession can be resumed by the Board. Sub-sections (4) and (5) make it clear that the allottee shall deliver possession thereafter to the Board within the date specified in the notice issued under Section 34B. Therefore, Section 34B operates in a different circumstance. It would kick only in cases of physical possession being handed over by the Board to the allottee on certain terms and conditions and the breach of those terms and conditions in the lease-cum- sale agreement is violated, which would lead to revocation of proceedings under Section 34B. Therefore, the submission that Section 34B ought to have been followed is a figment of imagination of the learned counsel for the petitioner and holds no water. 15. Insofar as the judgments relied on by the learned counsel for the petitioner, they are all distinguishable on the facts obtaining in the cases therein without much ado. They were all cases where lease-cum-sale agreements had already been executed in favour of those allottees and, therefore, the co-ordinate Benches held that show cause notice prior to resumption of possession was imperative. Even in the case of M/s Nanjundeshwara Tech Park v. The Karnataka Industrial Areas Development Board, W.P. No. 13304 of 2020 decided on 3-11-2023 , the respondent Board was directed to consider the representation of the petitioner in terms of Section 34B of the Act. Even in the case of M/s Nanjundeshwara Tech Park v. The Karnataka Industrial Areas Development Board, W.P. No. 13304 of 2020 decided on 3-11-2023 , the respondent Board was directed to consider the representation of the petitioner in terms of Section 34B of the Act. Therefore, the judgments so relied on by the learned counsel for the petitioner would not render any assistance in the light of two factors – one being, the facts obtaining in those cases and the other being, the judgment of the Division Bench which upholds the clause in the allotment letter whereby permitting cancellation of allotment without even issuance of a notice. Therefore, the contentions so advanced by the petitioner are unacceptable. The unacceptability would lead to rejection of the petition.” (Emphasis supplied) To iterate, the petitioner was allotted the subject land on 08-03-2014. Several communications, proceedings, change of the standing of the petitioner has taken place. On factor remains unchanged for all the 10/11 years prior to passage of the order impugned is, the default of the petitioner in making any payment in terms of the letter of allotment. The case is a mirror that reflects the consequences of indolence, it is trite that law protects the diligent and not the indolent. The petitioner has failed to fulfill its financial obligations, despite being granted ample time and opportunity – nay indulgence by the Board. 10/11 years have elapsed since the original obligation arose. To now demand equity, without fulfilling the obligations all through the decade is sans countenance. In the result, the Court finds no infirmity in the action taken by the Board. The cancellation is neither arbitrary nor unreasonable, it was in fact, an inevitable consequence on the repeated default of the petitioner. 13. Finding no merit in the petition, the petition stands Rejected.