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LPA No.765/2003 HIGH COURT OF DELHI
GHANSHYAM DASS SETH & ANR. …APPELLANTS
Through: Mr.Vikas Singh, Sr.Adv. with Mr.Naunidh S.Arora, Advocate.
Through: Mr.Sachin Datta and Ms.Gyatri Verma, Advocates
HON‟BLE MR. JUSTICE RAJIV SHAKDHER
JUDGMENT
1. Whether the Reporters of local papers may be allowed to see the judgment? YES
2. To be referred to Reporter or not? YES
3. Whether the judgment should be YES reported in the Digest? 2011:DHC:4483-DB SANJAY KISHAN KAUL, J.
1. A perpetual lease deed was executed on 28.10.1959 by the President of India in favour of Smt.Raj Karni, Sh.Harbhajan Dass and Mr.Narain Dass in respect of plot no.32-33, NH-IV, Lajpat Nagar, admeasuring 1450 square yards.
2. The covenant of the lease in para I(ii) inter alia provided that a building would be constructed on the plot within 24 calender months. On violation of any term of the lease, the perpetual lessor was entitled to re-enter upon the property.
3. In respect of the said land, plot no.32 was sold by the perpetual lessees to Smt.Vimla Rani vide a sale deed executed on 17.10.1960 which was duly registered. However, no construction was carried out nor was apparently even mutation obtained in respect of the property for almost 13 years. This resulted in a show cause notice dated 29.08.1973 being issued by the Land and Development Office/respondent threatening to re-enter the property on account of non construction and consequent violation of clause I(ii) of the lease deed. Since no satisfactory cause is stated to have been shown, re-entry order was passed on 03.04.1975. It is, however, not clear as to why but the fact is that the re-entry notice was sent to Smt.Shiela Sandhu. Smt.Vimla Rani addressed a letter dated 25.04.1975 to the L&DO stating that she had informed vide a registered AD letter dated 22.11.1960 that she was the perpetual lessee of the plot. Smt.Vimla Rani further volunteered to pay any charges for withdrawal of re-entry. The L&DO in response to this letter on 26.05.1975 communicated the charges for regularization of breaches temporarily payable up to 30.06.1974 with an undertaking to be furnished by Smt.Vimla Rani on a non judicial stamp paper that she would remove the breaches by 30.06.1974 or get them regularized beyond the said date. In para 5 of the said letter, it was stated as under:
4. The aforesaid charges were paid and subsequently the property was mutated in the name of Smt.Vimla Rani vide a memorandum dated 09.10.1975 on the same terms and conditions as laid down in the perpetual lease deed.
5. The appellant no.2, Smt.Vimla Rani, still did not take steps to remove the breaches inasmuch as no construction was raised. With the said factual position, on 17.02.1976, Urban Land (Ceiling and Regulation) Act, 1976 („the said Act‟ for short) came into force. The objectives of the said Act as set out in the Preamble show that the vacant land in the urban areas was sought to be brought within a ceiling limit and such excess land was to be acquired. The said Act also provided for regularization of construction of building on such land and for matters connected therewith with a view to prevent the concentration of urban land in the hands of a few persons and speculation and profiteering therein and with a view to bring about a more egalitarian distribution of urban land. The said Act was, however, made effective from a retrospective date of 17.02.1975. The property in question was thus covered under the said Act being an excess vacant land in the case of Smt.Vimla Rani. The L&DO served a letter dated 12.01.1977 on Smt.Vimla Rani once again in respect of her failure to remove the breaches etc. before exercising the powers of re-entry to cancel the lease deed for non construction in respect of the property in question. Smt.Vimla Rani in terms of the letter dated 24.01.1977 claimed that the ownership title in the premises was restored to her only on 09.10.1975 and she should be allowed the time limit of two years for construction of the plot up to 09.10.1977. She expressed her willingness to proceed with the construction of the plot for which she stated that she had applied to the competent authority under the said Act for release of the plot. It was also stated that the release orders were still awaited.
6. The L&DO vide letter dated 21.05.1977 acceded to the request of Smt.Vimla Rani by extending the date for completion of construction without levy of penalty up to 30.06.1977. She was put to caution that no further extension will be granted beyond this date. Factually, no construction was carried out.
7. The proceedings continued under the said Act and it is the case of Smt.Vimla Rani that a draft statement was prepared under Section 8(1) of the said Act on the basis of the statement filed by her. On disposal of objections, a final statement under Section 9 of the said Act was passed vide order dated 20.06.1980 in terms whereof the competent authority declared the entire plot admeasuring 606.19 square meters as excess vacant land. Smt.Vimla Rani filed an appeal against that order before the appellate authority on 17.07.1980, but the same was dismissed on 01.04.1981.
8. It is the case of the appellants that thereafter an application was filed for grant of exemption of the aforesaid excess vacant land under Section 20 of the said Act. It is their say that a person was allowed to retain excess vacant land ad measuring more than 600 square mtrs. provided he was prepared to develop the same as a group housing. On such an application being filed, the Delhi Administration is stated to have enquired from DDA and L&DO on 01.08.1981 as to whether group housing was permissible on the excess vacant land. Similar communications in this behalf ensued. The appellants state that vide letter dated 15.02.1982 of the DDA and 17.01.1983 of the L&DO it was affirmed that group housing is permissible on the plot in view of the notification dated 11.12.1975 in terms whereof the exemption may be granted in respect of a plot where the plot is more than 500 square mtrs. Another application is stated to have been made under Section 20 of the said Act on 09.01.1987 to the Secretary, Land and Building Department for permission to construct a group housing project. However, the request for exemption was declined on 06.07.1987 by the LG though no action was taken under Section 10 of the said Act. It is only on 18.09.1992 that a notification is stated to have been issued under Section 10(1) of the said Act for acquiring the land and interested parties were asked to file their claims within 30 days from the date of the publication of the notification. Objections were filed on behalf of the appellants to the notification, but on 02.12.1992 another notification under Section 10(3) of the said Act was issued declaring the property in question as excess vacant land which shall be deemed to have been acquired. The appellants filed WP(C) No.4529/1992 seeking quashing of the actions of the respondent. Notice was issued on that petition and status quo orders were passed. The writ petition was admitted and interim orders were made absolute during the pendency of the writ petition. It may be noted that there were a number of similar writ petitions pending.
9. The next development which took place was the repeal of the said Act on 22.03.1999. The effect of the repeal was that all such lands stood released from the applicability of the said Act if the possession had not been taken over under the said Act. Even in the case of deemed vesting of the land under Section 10(3) of the said Act, the land owners were entitled to retain possession provided they paid back to the State any compensation that they may have received in respect of the land. The appellants had not received any compensation and the possession continued with them. The land thus became free from the rigours of the said Act. The letter dated 09.11.2000 was thus addressed to the L&DO for grant of NOC for sanction of building plans on the plot followed by reminders dated 14.03.2001 and 08.06.2001. The appellants received a communication dated 16.05.2002 which specified the penalty for belated construction from 01.07.1977 to 31.12.2003 amounting to Rs.24,42,227/- plus ground rent @ of Rs.[8] per annum from 15.05.1975 to 14.07.2000. The appellants made various representations against the levy of penalty for a period prior to 22.03.1999 predicated on the plea of inability of the appellants to construct on the plot in question in view of the land having been declared as excess vacant land under the said Act. These representations dated 28.05.2002, 30.05.2002 and 05.09.2002 were responded to by the respondent on 03.10.2002 once again demanding the amount. The appellants thus filed WP(C) No.990/2003 challenging levy of penalty. Notice was issued on this petition and interim stay was granted against the impugned order dated 16.05.2002. On final hearing being concluded, the judgment was pronounced on 25.09.2003 dismissing the writ petition.
10. The sole aspect which appears to have been urged and thus considered by the learned Single Judge in the said order is the plea of appellant no.2 being prevented from constructing any building on the plot in view of the provisions of Sections 29 & 30 of the said Act. The learned Single Judge concluded that Section 29 did not impose a ban on construction, but merely regulated construction and that the construction proposed to be carried out ought not to have a plinth area in excess of 300 square metres. This was found not to aid the appellants. The other plea which was examined arose from Section 20 of the said Act as exemption had not been granted to the appellants. Learned single Judge found that from 29.10.1958 the plot had been lying vacant for 28 years till the said Act came into force. Even after appellant no.2 purchased it, she did not carry out the construction. She even moved an application for extension of time for construction which was granted and the property was not re-entered because of this reason. The writ petition was dismissed, but the appellants were permitted to make the payment of the penalty amount within sixty days of the pronouncement of the judgment and upon such payment, the respondent was to issue a No Objection Certificate. It is the aforesaid order, which has been impugned in the present appeal. Notice was issued on the appeal on 07.11.2003 and the counsel for the appellants volunteered to deposit the amount as directed by the learned Single Judge subject to the outcome of the appeal. This fact was taken note of while disposing of the interim application. The amount was deposited and the plot stands constructed upon as stated by learned counsel for the appellants. Appellant no.2 passed away and her legal heirs have been brought on the record.
11. Learned senior counsel for the appellants contended before us that the plea advanced on the basis of Section 29 of the said Act was apparently misplaced as that provision would not aid the appellants in any manner. Learned counsel, however, submitted that the relevant provision in the present case would be Section 3 r/w Section 2(l) of the said Act. A ground in this behalf has been taken. In order to appreciate this plea, we re-produce the relevant provisions of Section 3 r/w Section 2(l) of the said Act.
12. Learned senior counsel submitted that in terms of Section 3 of the said Act, no person shall be entitled to hold any vacant land in excess of the ceiling limit. The meaning of „to hold‟ is as defined in Section 2(l) of the said Act which will include ownership or possession. It was thus submitted that once the appellants could not hold the said land, there could not be any penalty charge on them for non construction on the plot.
13. It was the say of learned senior counsel for the appellants that a statutory legal impediment came in the way of the appellants in view of the provisions of the said Act coming into force retrospectively before the extended period, in which the construction was to be made by appellant no.2, expired. The said Act came into force on 17.02.1976 with effect from 17.02.1975. The respondent had condoned the delay in construction and granted extension on 26.05.1975 on payment of charges which were duly paid. The memorandum dated 09.10.1975 mutated the property in the name of the appellant no.2 and thus the appellants were entitled to construct within a period of two years from the said date i.e. up to 09.10.1977. Before expiry of such time, the said Act came into force. It is in view thereof, that the extended period granted by the respondent vide letter dated 21.05.1977 up to 30.06.1977 could not be availed of.
14. Learned counsel for the respondent on the other hand laid emphasis on the fact that for decades no construction has been carried out on the plot contrary to the terms of the lease deed. Appellant no.2 had become the owner of the plot in 1960 as claimed by her and yet right till 1973 no construction was made when show cause notice was issued by the respondent. Even thereafter, when on payment of charges, the re-entry was withdrawn, no construction was carried out. The property was even mutated in favour of appellant no.2, but appellant no.2 kept on just sitting on the plot without taking any action for construction. Learned counsel emphasized on the fact that even while imposing the charges as per letter dated 26.05.1975, clause 5 of that letter had made it clear that there would be no waiver for recovery of the damage charges which may be found payable in future for the breaches. The breach being undisputedly present, it was submitted that the respondent was well within its rights to demand the amount of penalty towards non construction.
15. Learned counsel for the respondent has submitted that the respondent was well within its rights to demand and recover penalty for breaches of the terms of the lease as the appellants had not constructed on the plot. It was his say that the respondent cannot continue to enjoy the property and yet claim that they are not bound by the terms of the lease.
16. A further submission advanced was that there was no prohibition from construction under the said Act as observed in the impugned order and learned counsel for the appellants had admitted before us that the provisions of Section 29 of the said Act would not aid the appellants. It was submitted that the provisions of Section 3 r/w Section 2(l) of the said Act could not aid the appellants as they prohibited a person only from holding any vacant land in excess of the ceiling limit but the fact remains that the appellants continued to hold the land.
17. Learned counsel for the respondent, in the end, referred to the judgment of the Supreme Court in Her Highness Maharani Shantidevi P. Gaikwad v. Savjibhai Haribhai Patel; (2001) 5 SCC 101 to emphasize that the State legislature had only surrendered the right to legislate in respect of the laws relating to the imposition of ceiling on the holding of urban immoveable property by passing a resolution under Article 252 (1) of the Constitution of India and all matters connected therewith or ancillary and incidental thereto in favour of Parliament. It was only a limited surrender in terms of that resolution and the aspect of town planning and development by the State was not surrendered.
18. We may notice that in rejoinder, learned senior counsel for the appellants pointed out that no construction could be carried out without obtaining the clearance from the competent authority as the municipal authority used to demand a No Objection Certificate under the said Act. He, however, conceded that though this was the position at the relevant stage of time, no pleadings in this behalf have been made.
19. In the aforesaid circumstances the short issue which arises for our consideration is:- whether the appellant can be called upon to pay penal charges for failure to construct a superstructure in accordance with condition No. I(ii) of the lease deed due to the intercession of ULCRA?
20. The formulation of the issue answers for us at least one part of query, which is, that after the date of repeal of ULCRA, the appellant is not entitled to a waiver of penalty on the stated ground, i.e., for the period 22.03.1999 onwards. However, this still leaves unanswered as to what would be the position for the period 01.07.1977 to 22.03.1999. The learned counsel for the appellant has not articulated before us the legal principle on which he would have us peg his submission seeking effacement or waiver of penalty. One of the conditions of the lease, i.e., condition No. I(ii) required the lessee to build a superstructure within 24 months, on the lines prescribed therein. The appellant says that he stood relieved of this burden and consequences of its breach since ULCRA interceded in the meanwhile.
21. There is admittedly no provision in ULCRA which alters the aforementioned obligation which runs with the land. Therefore, the submission of the learned counsel for the appellant to the effect that since Section 3 of ULCRA prohibited a person from holding land in excess of the ceiling limits prescribed therein would be of no assistance. The reason for this is the scheme of ULCRA which operates broadly on the following lines: On the commencement of ULCRA, no doubt, a person is not entitled to hold any vacant land (save and except as provided in ULCRA itself) in excess of the prescribed ceiling limits; the determination of such excess land requires the holder of such vacant land to pass through three stages prescribed under Sections 6, 8 & 9 of ULCRA. The ceiling limits prescribed under Section 4 are categorised based on the location of the land. Therefore, a person holding vacant land in excess of ceiling limits is required to file a statement under Section 6 before the competent authority specifying therein particulars, such as, the location, extent, value and other prescribed aspects of all vacant lands including the nature of his right, title and interest in the land(s) in issue. More particularly he is also required to specify the vacant land(s) within the ceiling limit which, he desires to retain. On such a statement being filed under Section 6, the competent authority after such an inquiry as it deems fit, prepares a draft statement qua the person who has filed a statement under Section 6. The statement would contain the particulars prescribed under subsection (2) of Section 8. In terms of sub-section (3) of Section 8, the draft statement is required to be served, in the manner prescribed, on the concerned persons along with the notice calling upon them to file objections, if any, within the stipulated period of 30 days or within such further period as may be specified. After giving the objector, a reasonable opportunity and, on consideration of the objections filed, the competent authority is required to pass an order qua the objections under sub-section (4) of Section 8. It is only thereafter, that the competent authority makes out a final statement. The final statement would contain alterations, if any, in the draft statement based on the orders passed on the objections filed. A copy of the draft statement under Section 8(3), is also served on the owner of the land if, the vacant land is held; under lease, mortgage or a hire purchase or an irrevocable power of attorney.
22. It is on completion of the exercise under Section 9, and thereupon, the service of the final statement prepared on the person concerned, that the competent authority issues a notification under Section 10(1) of ULCRA indicating therein the particulars of the vacant land held, by such a person, in excess of the ceiling limit. The notification thus published will state that such vacant land is acquired by the concerned State Government, and that persons interested in such vacant land, should file their claims either personally or through their agents specifying therein their interest in the land. The determination of the claim (s) is made under sub-section (2) of Section
10. The aforesaid is followed by a declaration under sub-section 10(3) of ULCRA, published in the official gazette, indicating therein the date from which such land is deemed to have been acquired by the concerned state government. It is upon publication of such a declaration that the land in issue, vests in the concerned State Government free from all encumbrance from the date so specified.
23. It is during the period: commencing from the date of publication of notification under sub-section (1) of Section 10 and ending with the date specified in the declaration made under Section 10(3); that no person is entitled to deal with such excess vacant land by way of transfer, sale, mortgage, gift, lease or otherwise and alter its use or cause its use to be altered. Transfer made in contravention of this provision is deemed to be null and void.
24. The Section 11 provides for compensation to be paid in respect of vacant land acquired by the Government. The power of exempting a person from the acquisition of excess land is conferred on the State Government under Section 20 of ULCRA. This power, the State Government is obliged to exercise, keeping in mind the location of the land, the purpose for which it was used or proposed to be used and other relevant factors having regard to expediency and public interest.
25. We may also notice at this stage certain other provision, which largely pertains to transfer of vacant land and construction thereof. In this regard we may first refer to Section 5 of ULCRA deems transfer made on commencement of ULCRA as void. Section 26 obliges a person holding a vacant land within ceiling limits to give notice to the competent authority before effecting a transfer of such lands. If notice is given, the concerned state government in accordance of subsection (2) of section 26 shall have the first option to purchase such lands. Such option is required to be exercised within a period of 60 days from the receipt of notice, failing which, it is presumed that the competent authority has no intention to purchase the land on behalf of the state government and that it is lawful for the applicant to transfer the land as he likes. Section 27 prohibits transfer of urban or urbanisable land with building or a portion of such building for a period of 10 years of the commencement of ULCRA or from the date of the construction of building whichever is later, except with the permission of the competent authority. If the competent authority were to refuse the grant of permission then it is required to give reasons in writing which, it is further obliged to communicate to the applicant. As in section 26, there is also a provision of deemed approval and the right to purchase such property by the competent authority