Lakshmi Metallurgy Limited v. Govt Of Andhra Pradesh
2025-02-21
K.MANMADHA RAO
body2025
DigiLaw.ai
ORDER : K. MANMADHA RAO, J. This writ petition is filed under Article 226 of the Constitution of India for the following relief: “……to issue a Writ Order or Direction more particularly one in the nature of Writ of Mandamus declaring the inaction of Respondents 24 in issuing NOC/executing Sale Deed to the Petitioner for Plot Nos 67, 69, 70, 71, 72 and 73 at Industrial Park, Gajulamandyam in Renigunta Revenue Mandal, Chittor District, A.P., notwithstanding compliance of proceedings No 20559/DW/D10/IP/GMD/07 dated 17.05.2016, as arbitrary illegal, misuse of powers vested with office violation of Article 14 and 19 of Constitution of India and consequently direct the Respondents 2 to 4 to issue NOC/execute Sale Deed without imposing penal conditions for execution of sale deed in favor of the Petitioner for Plot Nos 67, 69, 70, 71, 72 and 73 at Industrial Park Gajulamandyam in Renigunta Revenue Mandal, Chitoor District, A.P. in compliance with proceedings No 20559/DW/D10/IP/GMD/07 dated 17.05.2016 and accord reasonable time for completion of the project from the date of issuance of NOC / Execution of sale deed and pass……” Brief facts of the case are that the Petitioner made an application to the 2 nd respondent seeking allotment of land for setting up "Ferro Alloys Industry" ('Project'). The application was forwarded to the 4 th Respondent for necessary action. The final allotment order was issued by the 4 th Respondent confirming the allotment of Plot No's. 67 and 69 to 73 at Industrial Park, Gajulamandyam in favor of the petitioner for Rs.1,53,52,800/-. An Agreement of Sale was also entered into and Pursuant to the Agreement, possession certificate was issued. Petitioner without wasting any time, with great diligence started development work on the subject land but it took more than two and half years to get the statutory approvals. Pursuant to obtaining approval almost 70% of the building works on the subject land was completed. It is stated that the APSPDCL issued a revised estimate to the petitioner for supplying electricity to the subject land. The petitioner applied for credit facilities from financial institutions and with great difficulty convinced ICICI Bank to advance credit facilities of Rs.14.00 Crore. Amount was sanctioned subject to issuance of NOC from 4 th Respondent. Pursuant thereto, the petitioner requesting the 4th Respondent for grant of No objection Certificate (NOC) under clause 4 (a) of Agreement.
The petitioner applied for credit facilities from financial institutions and with great difficulty convinced ICICI Bank to advance credit facilities of Rs.14.00 Crore. Amount was sanctioned subject to issuance of NOC from 4 th Respondent. Pursuant thereto, the petitioner requesting the 4th Respondent for grant of No objection Certificate (NOC) under clause 4 (a) of Agreement. The 4th Respondent neither granted the NOC nor replied to the communications issued by the Petitioner on numerous occasions. Accordingly, the petitioner sought for extension of time as commercial production could not be commenced within two years. The 4th Respondent extended the time till 30-11-2014 but penalty of Rs.19,34,453/ was levied. Petitioner requested the for waiver of the penalty and further requested for issuance of NOC to ICICI Bank. It is further stated that Multiple Letters were sent as NOC was not granted even after lapse of a year. Finally the 4th Respondent waived penalty and granted NOC to ICICI Bank after fourteen months. Owing to the delay, bank withdrew its decision to sanction loan and the NOC was returned. In view of the same, the petitioner suffered loss of Rs. 24,50,000/- paid as processing fee to bank. Due to delay caused in issuance of NOC, further extension of time for 15 months was sought. But surprisingly show cause notice was issued seeking reason for not cancelling the allotment. Thereafter, the petitioner issued reply explaining the reasons for delay. An additional reply with supporting documents was also issued. The Petitioner requested for issuance of NOC to Canara Bank for loan. But the Respondents did not respond and the Petitioner’s request for grant of NOC was rejected as project not implemented within stipulated time. Thereafter, detailed Representations were sent by petitioner explaining the cause of delay and the investments made and sought for final extension of one year with NOC. Even though Valuation certificates to the tune of 20 crore and photographs showing 80% work completion were also sent, the allotment of land made to the Petitioner was cancelled. Further, the 4th Respondent also sought to cancel the Agreement of Sale and forfeit the EMD amount and requested the Petitioner to surrender the subject land within fifteen days. Aggrieved by the same, the petitioner filed WP 8322/2016 before the High Court and this Court has granted Interim suspension orders. It is also stated that the 2nd Respondent was requested for EOT & NOC.
Aggrieved by the same, the petitioner filed WP 8322/2016 before the High Court and this Court has granted Interim suspension orders. It is also stated that the 2nd Respondent was requested for EOT & NOC. Certain conditions were put forth by Respondents for grant of EOT & NOC. Later, the Petitioner remitted Rs.5,00,000/- towards penalty. But respondents insisted payment of entire amount in single payment. Multiple Requests were made for payment in installments. But demand for single payment was reiterated. Accordingly, the Petitioner paid the full penalty amount and requested for NOC to Union Bank for loan. But the amount was returned as WP was not withdrawn. It is further stated that the Petitioner undertook to withdraw the WP on receipt of NOC with sanction of 12 months EOT. Occupancy Certificate was also sought for. The Respondent informed that the above would be subject to withdrawal of WP etc., Thereafter, steps have been taken for withdrawal of the writ petition and the same was informed to the Respondent. The conditions for grant of NOC etc were fulfilled by the petitioner and the DD's were accepted by Respondent, but further amount of Rs 5,62,312/- and memo filed for withdrawal was demanded. Penalty of Rs 88,171/- was remitted. Withdrawal memo was sent reiterating request for NOC and EOT for one year. Even though the Petitioner sent multiple letters detailing the various timelines and efforts made by the Petitioner to implement the project, no steps have been taken by the respondents. Hence, the present writ petition. 3. The counter affidavit has been filed by the respondents No.2 to 4. While denying the allegations made in the petition, inter alia, contended that, the petitioner with mala fide intention has not fulfilled the conditions of the EOT granted, further in order to delay the project, the petitioner vide Letter dated 19.07.2016 has submitted Demand Draft for Rs.5,00,000/-. The same was not accepted by this office as the total EOT penalty which was Rs.34,39,027/- + Service Tax @15% Rs.5.15.854/- The DD worth Rs.5,00,000/- was returned to the allottee vide Ietter dated 22.07.2016 and requested to pay the total amount. In order to further delay the petitioner vide Ietter dated 14.09.2016 has forwarded DD worth Rs. 10,00,000/- to head office towards EOT fee. Head office vide Ietter dt.09.02.2017 has returned the DD of Rs.
In order to further delay the petitioner vide Ietter dated 14.09.2016 has forwarded DD worth Rs. 10,00,000/- to head office towards EOT fee. Head office vide Ietter dt.09.02.2017 has returned the DD of Rs. 10,00,000/- and instructed to pay the total EOT penalty along with applicable tax and the petitioner has not taken any steps in fulfilling the conditions of APIIC letter dated 17.05.2016. This shows the petitioner has been intentionally delaying the project and has no interest in implementing the project and the seeking of NOC is being used to evade the cancellation and resumption. It is stated that the petitioner has not implemented the project inspite of elapse of substantial time and there also appears no intention to implement the project, and petitioner wants to withhold the land vacant and without any industrial activity merely as real estate and clearly violated the conditions imposed by APIIC vide letter dated 17.05.2016, i.e by not paying the penalty(intentionally wasted time in paying amounts in phased manner with a gap of 2 months in zonal office and 9 months in Head office from the date of consideration of EOT and NOC ie 17.05.2016 However the same was rejected by Zonal office and APIIC Head office as well and requested the petitioner to pay full amount along with applicable taxes. But after protracted correspondence, the allottee vide Lr.No.LML/APIIC/21/2017-18, Dt: 19.06.2017 has furnished DD. No.786477, Dt:17.05.2017 for Rs.39,84,881/- to Head Office and the same has been accepted. It is further stated that penalty is payable on the current land rate of APIIC and hence in this case there is short payment of penalty due to revision of land rate from Rs.1,120/- psm, to Rs. 1,255/- psm., w.e.f. 01.06.2017, the allottee has been requested for payment of balance penalty & GST amount vide reference 2 nd cited. In reply, the allottee vide letter 3rd cited has stated that the present land rate of Rs. 1255/- per sq.mtr is not applicable, since they have paid full payment of the amount prior to 01.06.2017 and there is delay in acceptance of DD by APIIC. The allottee has requested for considering penalty on old land rate of Rs.1,120/- per sq.mtr., ie, prevailing as on the date of the Demand Draft and furnished DD. No. 108433, dt:31 08.2017 for Rs.88,171/- towards balance GST and legal expenses.
The allottee has requested for considering penalty on old land rate of Rs.1,120/- per sq.mtr., ie, prevailing as on the date of the Demand Draft and furnished DD. No. 108433, dt:31 08.2017 for Rs.88,171/- towards balance GST and legal expenses. The details of payments received from the allottee as follows: Sl.No. Receipt No. Date Amount Head of A/c 1 1757 25.07.2017 33,77,018.00 Part payment of penalty 2 1791 25.07.2017 6,07,863.00 Payment of GST @ 18% 3 2902 31.08.2017 62,009.00 Part payment of penalty 4 2903 31.08.2017 11,162.00 Payment of GST @ 18% 5 2904 31.08.2017 12,712.00 Legal expenses 6 2905 31.08.2017 2,288.00 GST @ 18% on legal fee It is further stated that the penalty has not been paid and as per the land rate of Rs.1,255/- per sq.mtr. applicable w.e.f 01.06.2017, applicable by the date of payments by the petitioner still it is in due of difference penalty (i.e., Rs.38,53,553.00 Rs.34,39,027.00) along with GST @ 18%, which works to Rs.4,89,141.00 (Penalty Rs.4,14,526/- GST Rs.74,615.00) thus it has not complied with the terms and conditions and now the petitioner has approached this Hon'ble Court stating only facts suiting itself. Thus, the allottee has requested for considering penalty @ 3% on land rate of Rs. 1,120/- per sq.mtr., prevailing upto 31.05.2017 instead of Rs. 1,255/- per sq.mtr revised wef.01.06.2017, duly stating that issue was long pending with the Corporation as they have submitted DDs towards payment of penalty & legal expenses to APIIC within the time but the same were returned by APIIC vide letter dt:05.06.2017 stating that the case is not withdrawn and also stated that since their Advocate expressed delay due to court vacations in May, the withdrawal issue was delayed which is not deliberate and hence they submitted an Affidavit for withdrawal of case in their letter dt. 19.06.2017 Further it is also to be noted that the petitioner filed court case which was disposed as withdrawn on 05.01.2018 which was a delay of nearly 8 months from the date of consideration of EOT and NOC by APIIC. The petitioner merely dragged the issue by making some DD to APIIC just to drag the matter and failed to pay the entire penalty and withdraw the case expeditiously though he had the option to submit withdrawal letter previously as per the EOT conditions as above stated.
The petitioner merely dragged the issue by making some DD to APIIC just to drag the matter and failed to pay the entire penalty and withdraw the case expeditiously though he had the option to submit withdrawal letter previously as per the EOT conditions as above stated. It is further stated that inspite of availing the opportunity given by APIIC for EOT & NOC, the petitioner has started continuously corresponding for execution of sale deed or issue of NOC without fulfilling the terms and conditions requested by APIIC. The grievance of the petitioner has been heard personally by the 2nd respondent and the 2nd respondent has inspected the premises on 07.07.2021 in the presence of the petitioner and the petitioner was also instructed to get the power connection and implement the unit as the petitioner has not even got power. But, inspite of taking action for implementation, the petitioner has filed this WP simply blaming APIIC for nothing. It is further stated that APIIC has always been encouraging the petitioner in implementing the project, but the petitioner failed to utilize the opportunities and now blaming APIIC for the delay is not correct.It is stated that the petitioner has been holding huge industrial lands idle and vacant thus adversely affecting the industrial development. The petitioner is therefore not entitled to any reliefs and the writ petition is not maintainable. 4. The Reply affidavit has been filed by the petitioner to the counter affidavit filed by the respondents No.2 to 4. Wherein, it is stated that, the delay from 2012 is solely attributable to the Respondents for not issuing NOC in time to ICICI, not considering NOC to Canara Bank, show cause notice and consequent litigation, refusal to accept penalty in installments by taking a rigid stand to receive only as single payment, failure to consider issuing NOC subsequent to withdrawal of WP No.8322 of 2016 despite several requests till date. The respondents believe in the adage that Silence is the most perfect expression of Scorn. The respondents' contention that the Petitioners are responsible for 13 years delay in implementing the project is without merit and deserves to be discredited. It is stated that the status of project work is being informed and updated to the respondents from time to time as also bank related issues and power related problems by addressing various letters.
The respondents' contention that the Petitioners are responsible for 13 years delay in implementing the project is without merit and deserves to be discredited. It is stated that the status of project work is being informed and updated to the respondents from time to time as also bank related issues and power related problems by addressing various letters. In fact the entire communication was placed before this Hon'ble Court. It is further stated in the reply affidavit that the Respondents issued NOC to ICICI Bank after 15 months from the date of request. Exs P20 & P21 letters were never disputed till date. ICICI bank authorities by its letter make it abundantly clear that they were no longer willing to accept the industrial plots at Gajulamandayam as collateral. It is stated that action of the respondents in not issuing NOC in time, however, holding that the petitioner is responsible for delay in project implementation and thereby causing Show Cause notice is a diabolic play, played again and again with total disregard for the principles of natural justice. It is further stated that the plant construction has been carried out in accordance with approved plan. Raw materials have to be imported in ship loads and the same will be stored in open yard. The finished goods are also stored in open yard. This coupled with phase II expansion plan of the petitioner requires the land area allotted to it. It is further stated that the Respondents are well aware of this and accordingly allotted the land after duly studying the project report of the petitioner. It is also stated that the Respondents were rather intransigent in their stand of acceptance of penalty only as a single payment. Further, the Respondents never replied to Ex-P.45 and for the first time before this Court, they claimed that the Petitioner has not fulfilled the terms and conditions as per Ex P.42. Innumerable requests were made by the Petitioner for Sale Deed/NOC, but the Respondents never responded and rather maintained silence. In fact, without prejudice, the petitioner obtained Demand Draft from HDFC Bank, Mahalakshmipuram, Bangalore for Rs. 4,89,141/- on 28-12-2021 and the same is being handed over in the office of respondent authority. It is further stated that 2nd respondent instructed to the petitioner to obtain power and to implement project is contrary to the facts.
In fact, without prejudice, the petitioner obtained Demand Draft from HDFC Bank, Mahalakshmipuram, Bangalore for Rs. 4,89,141/- on 28-12-2021 and the same is being handed over in the office of respondent authority. It is further stated that 2nd respondent instructed to the petitioner to obtain power and to implement project is contrary to the facts. If that were to be so, nothing prevented the authority from issuing necessary orders in reply to the several attempts by the Petitioner in getting NOC. Huge amounts were invested as explained in the writ affidavit. It is further stated that petitioner is committed to start the industry as early as possible. Such of the averments which are not specially traversed in the counter affidavit are hereby denied and the petitioner put the respondents for the strict proof of the same. 5. Heard Sri Jaggi Reddy, learned counsel representing Ms. Manasa Kanneganti, learned counsel appearing for the petitioner and learned Government Pleader for Industries & Commerce and Sri Gurram Ramachandra Rao, learned Standing Counsel for APIIC appearing for the respondents. 6. On hearing, learned counsel for the petitioner while reiterating the averments made in the petition, argued that, a proposal was mooted to the 2 nd respondent to set up ancillary industries for crushing, sizing and converting certain by-products produced in the main plant. For the said purpose, the petitioner requested the 2 nd respondent for allotment of Ac 100.00 cents for setting up the primary unit of Steel and Ferro Alloys and for setting up the ancillary units. However, as such a huge chunk of land was not available, the 2 nd respondent agreed to allot land to the petitioner for setting up of a steel and Ferro Alloys industry in one plot and for setting up ancillary units at separate individual plots in the vicinity. He submits that, the petitioner made an application to the 2 nd respondent seeking allotment of land for setting up Ferro Alloys Industry Project) in the year 2007 and the same was forwarded to 4 th respondent. In pursuant thereto, the 4 th respondent issued an allotment order dated 12.12.2007 to the petitioner provisionally allotted Plot Nos.67, 69, 70, 71, 72 and 73 at Industrial Park, Gajulamandyam, in Renigunta Revenue Mandal, Chittoor District.
In pursuant thereto, the 4 th respondent issued an allotment order dated 12.12.2007 to the petitioner provisionally allotted Plot Nos.67, 69, 70, 71, 72 and 73 at Industrial Park, Gajulamandyam, in Renigunta Revenue Mandal, Chittoor District. He submits that the said allotment order was amended vide order dated 2.5.2008 by the 4 th respondent modifying the total extent of land as 102352/00 sq mts. instead of 107650.20 sq mts. Thereafter, an agreement of Sale was made between the 4 th respondent and the petitioner dated 2.5.2008 in respect of the subject land. Learned counsel further submits that, in pursuance of the said agreement, a possession certificate was also issued by the 4 th respondent handing over the subject land to the petitioner. But later delay in obtaining electric supply from APSPDCL and the delay caused due to bifurcation of State of AP and the consequent unavailability of labour and staff, delay caused by the 4 th respondent in issuing NOC to financial institutions. 7. Learned counsel for the petitioner mainly contended that, upon receiving the possession of the subject land on 5.5.2008, it took more than two and half years to get the statutory approvals from the competent authorities despite exercising due diligences and follow up with all the authorities. He submits that the petitioner could not have commenced construction on the subject land without the necessary statutory approvals as the allotment order itself makes the allotment of land subject to compliance of the mandatory conditions enlisted therein, which included obtaining statutory approvals by the petitioner from the competent authorities. Later, after obtaining statutory approvals the petitioner finished almost 70% of building works on the subject land. Thereafter the petitioner made a communication dated 22.5.2013 to the 4 th respondent requested for extension of time as the time stipulated under the Agreement having expired on 4.5.2010. However the 4 th respondent neither communicated the reasons for non issuance of NOC nor granted NOC to the petitioner and hence the letters dated 3.8.2013, 17.9.2013, 4.10.2013 were addressed to the 4 th respondent. Finally, vide two communications dated 10.01.2014 addressed to the petitioner and ICICI Bank, the 4 th respondent waived the penalty of Rs.19,34,453/- for extension of time and granted NOC to ICICI bank for creating equitable mortgage of the subject land for the land granted by ICICI Bank. 8.
Finally, vide two communications dated 10.01.2014 addressed to the petitioner and ICICI Bank, the 4 th respondent waived the penalty of Rs.19,34,453/- for extension of time and granted NOC to ICICI bank for creating equitable mortgage of the subject land for the land granted by ICICI Bank. 8. Learned counsel for the petitioner further contended that, to the shock and surprise of the petitioner, the 4 th respondent issued a show cause notice dated 31.12.2014 and the petitioner has submitted its explanation explaining the reasons for delay in commencement of production. Later, the 4 th respondent addressed a letter dated 19.01.2016 to the petitioner rejecting the request made by the petitioner for grant of NOC vide proceedings dated 26.2.2016 on the ground that the project has not been implemented within stipulated extended time of 30.11.2014. He further submits that aggrieved by the action of the 4 th respondent the petitioner filed WP No.8322 of 2016 before the High Court at Hyderabad and it has granted interim suspension of the operation of the proceedings of the 4 th respondent. In response, the 3 rd respondent has passed order vide proceedings No.20559/DW/D10 /IP/GMD/07, dated 17.05.2016 stating that the request made by the petitioner for granting of extension of time for a period of one year has been examined in detail and considered subject to the following conditions:: i) The Petitioner should pay Rs.34,39,027/- towards penalty for extension of time @3% of the-then land cost, ii) The Petitioner should submit bi-monthly progress report along with Photographs of the development of project implementation, iii) The order is subject to notarized undertaking and authorization executed by the Petitioner on 19.03.2015, and iv) The Petitioner to withdraw the Writ Petition No.8322/2016 and submit relevant documents regarding withdrawal of the case to the Office of the 4th respondent, and to pay legal expenses of Rs.15000/- along with penalty. 9. In pursuance to the same, the petitioner paid full amount of Rs.34,54,027/- and legal charges of Rs.15,000/- to the 4 th respondent vide LML/ APIIC/20126-17 dated 18.2.2017 and requested for issuance of NOC in favour of Union Bank of India, Yeshwanthpur Branch, Bangalore who had agreed to give loan upon receipt of NOC., the petitioner has also paid service tax of Rs.5,15,854/- @ 15% of the penalty amount to the 4 th respondent vide LML/APIIC/2016-17 dated 23.02.2017 and again requested.
However, the 4 th respondent returned the DDs on the ground that the petitioner had failed to comply with the conditions stipulated for extension of time, and directed the petitioner to resubmit the same along with documentary evidence with regard to withdrawal of WP No.8322/2016. Learned counsel further submits that the said writ petition was withdrawn by the petitioner on 5.1.2018 and the same was informed to 4 th respondent by way of letter vide Ref LML/APIIC/2017-18 dated 22.01.2018 and requested for execution of sale deed to avail bank loan. But the respondents have neither replied to the petitioner’s request either in affirmative or in the negative, and remain indifferent to the appeals made by the petitioner for consideration of its request of NOC/Sale deed in compliance of the letter and spirit of the orders passed vide proceedings No.20559/DW/ D10/GMD/07 dated 17.5.2016 by the 3 rd respondent, which is illegal and arbitrary. Therefore, learned counsel requests this Court to allow the present writ petition by setting aside the impugned proceedings. 10. Per contra, learned Government pleader opposed for allowing the writ petition and prayed to dismiss the same. 11. Whereas, Sri Gurram Ramachandra Rao, learned Standing counsel for APIIC appearing for the respondents, while reiterating the averments made in the counter affidavit, denied all the contents made by the petitioner. He submits that, inspite of taking action for implementation, the petitioner has filed this WP simply blaming APIIC for nothing. He submits that APIIC has always been encouraging the petitioner in implementing the project, but the petitioner failed to utilize the opportunities and now blaming APIIC for the delay, is not correct. He submits that the petitioner has been holding huge industrial lands idle and vacant thus adversely affecting the industrial development. Hence, the petitioner is therefore not entitled to any reliefs and the writ petition is not maintainable. 12. To support his contentions, learned Standing Counsel has placed reliance on decisions of Hon’ble Supreme Court reported in (i) Andhra Pradesh Industrial Infrastructural Corporation Limited and another versus Shivani Engineering Industries, [(2015) 7 Supreme Court Cases 241], wherein the Apex Court in para 25 & 29 held as follows: 25.
12. To support his contentions, learned Standing Counsel has placed reliance on decisions of Hon’ble Supreme Court reported in (i) Andhra Pradesh Industrial Infrastructural Corporation Limited and another versus Shivani Engineering Industries, [(2015) 7 Supreme Court Cases 241], wherein the Apex Court in para 25 & 29 held as follows: 25. The representation was given on 3.2.2007 by the respondent for restoration of allotment of the plot and the same was accepted by the Corporation by informing the respondent that the restoration of the provisional allotment of plot will be done subject to the payment of total cost of plot with interest on belated payment and penalty of 10% of the land cost at the prevailing rate. The same is the concession given by the Corporation to the respondent as it could not have restored the provisional allotment of the plot as the said restoration of allotment was totally impermissible in law. The concession was made in favour of the respondent by executing the agreement of sale of the plot on 13.3.2007 and the possession of the plot was also given on the same day and within two years from the date of possession of the said plot the project should have been implemented by the respondent. Despite the change of manufacturing activity from mosquito coil to heavy engineering project and bus-body manufacturing unit, the project was not implemented by the respondent within the said period. Therefore, the terms and conditions of the provisional allotment letter and the agreement of sale executed on 13.3.2007 are violated by it, therefore, the Corporation was entitled to cancel the allotment of plot and resume the land from the respondent, instead of doing so, the Corporation has again made concession by calling upon the respondent to pay the condonation fee at 3% which is totally impermissible in law. 29. Having regard to the facts and circumstances of the case, the Corporation and its officers are very generous in extending time in favour of the allottees for implementing the projects on the allotted plots and not invoking its right for cancellation and resuming the plot for non-compliance with the terms and conditions of allotment letter and agreement and re- allot the same in public auction in favour of eligible persons.
Therefore, it is a fit case for this Court to give direction to the CoD of the Telangana State to conduct a detailed investigation in the matter against all the officers who are involved in the cases of allotment of plots and extending the period in favour of the allottees for implementation of the projects for which purpose the plots are allotted and not cancelling the allotments made by the Corporation and resumed the plots and dispose of the same in accordance with law by taking steps. The CoD, Police must investigate the cases in the Corporation and take suitable action in this regard against officers involved in such cases. (ii) In a case of Rajasthan state industrial Development and Investment Corporation and another versus Diamond & Gem development Corporation Limited and another, [(2013) 5 Supreme Court Cases 470], wherein the Apex Court at paras 21, 22 & 39 held as follows: It is evident from the above, that generally the court should not exercise its writ jurisdiction to enforce the contractual obligation. The primary purpose of a writ of mandamus, is to protect and establish rights and to impose a corresponding imperative duty existing in law. It is designed to promote justice (ex debito justiceiae). The grant or refusal of the writ is at the discretion of the court. The writ cannot be granted unless it is established that there is an existing legal right of the applicant, or an existing duty of the respondent. Thus, the writ does not lie to create or to establish a legal right, but to enforce one that is already established. While dealing with a writ petition, the court must exercise discretion, taking into consideration a wide variety of circumstances, inter-alia, the facts of the case, the exigency that warrants such exercise of discretion, the consequences of grant or refusal of the writ, and the nature and extent of injury that is likely to ensue by such grant or refusal. 15. Hence, discretion must be exercised by the court on grounds of public policy, public interest and public good. The writ is equitable in nature and thus, its issuance is governed by equitable principles. Refusal of relief must be for reasons which would lead to injustice. The prime consideration for the issuance of the said writ is, whether or not substantial justice will be promoted.
The writ is equitable in nature and thus, its issuance is governed by equitable principles. Refusal of relief must be for reasons which would lead to injustice. The prime consideration for the issuance of the said writ is, whether or not substantial justice will be promoted. Furthermore, while granting such a writ, the court must make every effort to ensure from the averments of the writ petition, whether there exist proper pleadings. In order to maintain the writ of mandamus, the first and foremost requirement is that the petition must not be frivolous, and must be filed in good faith. Additionally, the applicant must make a demand which is clear, plain and unambiguous. It must be made to an officer having the requisite authority to perform the act demanded. Furthermore, the authority against whom mandamus is issued, should have rejected the demand earlier. Therefore, a demand and its subsequent refusal, either by words, or by conduct, are necessary to satisfy the court that the opposite party is determined to ignore the demand of the applicant with respect to the enforcement of his legal right. However, a demand may not be necessary when the same is manifest from the facts of the case, that is, when it is an empty formality, or when it is obvious that the opposite party would not consider the demand. …. … The cancellation of allotment was made by appellant- RIICO in exercise of its power under Rule 24 of the Rules 1979 read with the terms of the lease agreement. Such an order of cancellation could have been challenged by filing a review application before the competent authority under Rule 24 (aa) and, in the alternative, the respondent- company could have preferred an appeal under Rule 24(bb)(ii) before Infrastructure Development Committee of the Board. The respondent- company ought to have resorted to the arbitration clause provided in the lease deed in the event of a dispute, and the District Collector, Jaipur would have then, decided the case. However, the respondent- company did not resort to either of the statutory remedy, rather preferred a writ petition which could not have been entertained by the High Court. It is a settled law that writ does not lie merely because it is lawful to do so. A person may be asked to exhaust the statutory/alternative remedy available to him in law.
It is a settled law that writ does not lie merely because it is lawful to do so. A person may be asked to exhaust the statutory/alternative remedy available to him in law. (iii) In another case reported in Indu Kakkar versus Haryana State Industrial Development Corporation Limited and another, [(1999) 2 Supreme Court Cases 37], wherein at para 20 it held as follows: 20. Here the Agreement was entered into between the Corporation and the allottee as a sequel to the request made by the allottee to give him an industrial plot for the purpose of setting up an industry. Corporation reclprocated to the request on being satisfied that the allottee was able to carry out the obligations so as to accomplish the purpose of allotment. The assurance given by of the allottee that he shall start construction of the building for setting up the industry within a period of six months and complete the construction thereof within two years from the date of issue of allotment letter was verified and found acceptable to the corporation and then only the Corporation has chosen to enter into the agreement with the allottee. It is a matter of confidence which the Corporation acquired in the promise made by the allottee that the latter would perform such obligations. If the allottee Graduates from the scene after inducting someone else into the plot without consent of the Corporation it is not legally permissible for the inductee to compell the Corporation to recognize him as the allottee. 13. Perused the material on record. 14. On perusal of the material on record, it is observed that, an application was made by the petitioner to the 2 nd respondent seeking allotment of land for setting up “Ferro Alloys Industry” (Project) in the year 2007, who in-turn forwarded the same to the 4 th respondent, and in pursuant thereto, the 4 th respondent had issued an allotment order to the petitioner dated 12.12.2007. Later, the allotment order dated 12.12.2007was amended vide order dated 02.05.2008 issued by the 4 th respondent confirming the allotment of Plot Nos.67 and 69 to 73 at Industrial Park, Gajulamandyam in Renigunta Revenue Mandal, Chittoor District admeasuring 102352.00 Sq mts.
Later, the allotment order dated 12.12.2007was amended vide order dated 02.05.2008 issued by the 4 th respondent confirming the allotment of Plot Nos.67 and 69 to 73 at Industrial Park, Gajulamandyam in Renigunta Revenue Mandal, Chittoor District admeasuring 102352.00 Sq mts. In favour of the petitioner at a total sale consideration of Rs.1,53,52,800/- and accordingly an Agreement of Sale was made in between the petitioner and 4 th respondent in respect of the subject land. In pursuance of the same, a possession certificate dated 5.5.2008 was also issued by the 4 th respondent handing over the possession of the subject land to the petitioner. 15. The contention of the petitioner is that, after receiving possession of the subject land on 5.5.2008 , it took more than two and half years to get the statutory approvals from the competent authorities despite exercising due diligence and follow up with all the authorities. In the meantime, the Ferro Alloys Industry, after using its good will, the petitioner convinced ICICI Bank to advance credit facilities to the petitioner for developing the subject land and for sanction of the said credit facilities, the petitioner had to create equitable mortgage over the subject land in favour of ICICI Bank as security for the credit facilities. 16. It is further observed that, even though the petitioner made several representations, the 4 th respondent for issuance of NOC to ICICI Bank for disbursement of the loan, the 4 th respondent has not responded. Meanwhile the petitioner made communication dated 22.5.2013 for extension of time, as the petitioner owing to reasons beyond its control was unable to commence commercial production of the plant within stipulated time of two years from the date of possession. Finally, vide two communication dated 10.01.2014 addressed to the petitioner and ICICI Bank, the 4 th respondent waived the penalty of Rs.19,34,453/- for extension of time and granted NOC to ICICI Bank for creating equitable mortgage of the subject land for the loan granted by ICICI Bank. As the 4 th respondent did not respond, the petitioner made another communication dated 9.1.2016 addressed to the 2 nd respondent explaining the reasons for delay in commencement of production of Ferro Alloys Unit on the subject land. But the request of the petitioner was rejected by the 4 th respondent.
As the 4 th respondent did not respond, the petitioner made another communication dated 9.1.2016 addressed to the 2 nd respondent explaining the reasons for delay in commencement of production of Ferro Alloys Unit on the subject land. But the request of the petitioner was rejected by the 4 th respondent. the main contention of the learned counsel for the petitioner is that the 4 th respondent has not cancelled similar allotments made to other allottees even though the progress of work done by them was less than 50% of the work scheduled to be completed. In fact the petitioner learnt that several plots allotted to person in a similar manner by the 4 th respondent have been lying idle and vacant in Chittoor District itself and no cancellation order has been made by the 4 th respondent till date. 17. It is also noticed that as the petitioner did not receive any reply another request made to the 2 nd respondent while informing about the refusal by financial institutions who attended the credit facilitation workshop for MSME Entrepreneurs under the aegis of Additional Director, DIC, to finance Ferro Alloy Project citing High Power cost, shortage of power and depressed market conditions for Ferro Alloy and steel industries. Thereafter, the 3 rd respondent vide letter dated 9.2.2017 directed the petitioner to pay the full penalty amount, applicable service tax and take early action for withdrawal of WP No.8322 of 2016. Accordingly, the petitioner paid the full penalty amount of Rs.34,54,027/- and legal charges of Rs.15,000/- to the 4 th respondent and requested for issuance of NOC. It is further noticed that the petitioner has also paid service tax of Rs.5,15,854/- @ 15% of penalty amount to the 4 th respondent. But the 4 th respondent returned the DDs on the ground that the petitioner failed to comply with the conditions stipulated for extension of time and further directed the petitioner to resubmit the same along with documentary evidence with regard to withdrawal of WP No.8322 of 2016. 18.
But the 4 th respondent returned the DDs on the ground that the petitioner failed to comply with the conditions stipulated for extension of time and further directed the petitioner to resubmit the same along with documentary evidence with regard to withdrawal of WP No.8322 of 2016. 18. As seen from the impugned proceedings No.20599/DW/D10/IP/GM/07, dated 17.05.2016, wherein it was mentioned that, the request made by the allottee company for granting of extension of time for a period of One Year from the date of receipt of communication from the Zonal Manager has been examined in detail and considered subject to following conditions: i) To collect penalty @3% on the prevailing cost of the allotted land from the dallottee company as per allotment regulations 2012; ii) To advise the allottee to withdraw the WP No 8322/2016 filed by the Company against cancellation of allotment and obtain relevant documents a proof of the same, if it is felt that the process would be delayed in obtaining the documents from the Court, in the mean time you may obtain the copy of withdrawal letter submitted in the Court by the Advocate Counsel of the Petitioner iii) The Zonal Manager, APIC Ltd.. Tirupati may arrange NOC for release of finances to facilitate to implement the Project in the allotted land duly obtaining he request from the Bank. 19. It is settled law that the decision making process of an administrative authority ought to have tested on the touchstone of the illegality, irrationality or procedural impropriety. The decision making process of the respondents leading to the continued silence to the various representations made by the petitioner suffers from non-consideration of the relevant facts and non-application of mind. 20. Having regard to the facts and circumstances of the case and on considering the submissions of both the learned counsels, this Court is of the considered view that, while directing the petitioner to pay the penalty @ 3% on the prevailing cost of the allotted land to the respondent concerned, within a period of one (01) month. On paying such penalty, the 4 th respondent is directed to issue NOC/execute Sale Deed in favour of the subject land in compliance of the proceedings No.20559/DW/D10/IP/GMD/07, dated 17.05.2016, within a period of fifteen (15) days, by affording reasonable time for completion of project from the date of issuance of NOC/Execution of Sale deed. 21.
On paying such penalty, the 4 th respondent is directed to issue NOC/execute Sale Deed in favour of the subject land in compliance of the proceedings No.20559/DW/D10/IP/GMD/07, dated 17.05.2016, within a period of fifteen (15) days, by affording reasonable time for completion of project from the date of issuance of NOC/Execution of Sale deed. 21. With the above directions, the Writ petition is disposed of. There shall be no order as to costs. 22. As a sequel, all the pending miscellaneous applications in the writ petition, shall stand closed.