Delhi High Court
Indian Oil Corporation Ltd vs Delhi Development Authority & Anr on 11 May, 2016
Author: Rajiv Sahai Endlaw
Bench: Rajiv Sahai Endlaw
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 11th May, 2016.
+ W.P.(C) No.166/2013 & CMs No.337/2013 & 7148/2013 (both for
stay)
INDIAN OIL CORPORATION LTD. ..... Petitioner
Through: Mr. Abhinav Vashisht, Sr. Adv. with
Mr. Rajat Navet, Adv.
Versus
DELHI DEVELOPMENT AUTHORITY & ANR .... Respondents
Through: Mr. Arun Birbal, Adv.
AND
+ W.P.(C) No. 388/2013 & CM No.773/2013 (for stay)
HINDUSTAN PETROLEUM CORPORATION LTD.....Petitioner
Through: Mr. Avneesh Garg, Mr. P. Sinha &
Mr. Sukreet Khandelwal, Advs.
Versus
DELHI DEVELOPMENT AUTHORITY & ANR .... Respondents
Through: Mr. Arun Birbal, Adv.
AND
+ W.P.(C) No. 3546/2013 & CM No.6674/2013 (for stay)
BHARAT PETROLEUM CORPORATION LTD. ..... Petitioner
Through: Mr. Avneesh Garg, Mr. P. Sinha, Mr.
Samart Banerjee & Mr. Sukreet
Khandelwal, Advs.
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 1 of 25
Versus
DELHI DEVELOPMENT AUTHORITY & ANR. ....Respondents
Through: Mr. Rajiv Bansal and Mr. Siddhant
Gupta and Ms. Arpita, Advs.
CORAM:
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1. Each of the petitions (i) impugns the Circulars dated 24th September,
2007 and 1st August, 2011 of the respondent Delhi Development Authority
(DDA) with regard to the fixation of licence fee for retail outlets; (ii)
impugns the charging of retrospective interest @ 7% per annum on the
licence fee; (iii) seeks a direction to the respondent DDA to fix the licence
fee for retail outlets for a particular financial year prior to the said financial
year and not after the expiry of the same; and (iv) seeks a direction to the
respondent DDA to fix the licence fee after consideration of the
representations made by the petitioners.
2. Notice of the petitions was issued and subsequently rule nisi was also
issued and counter affidavits have been filed by the respondent DDA in each
of the petitions and rejoinder whereto has been filed by the petitioner in
W.P.(C) No.166/2013. The counsels were heard on 14th August, 2015 and to
enable the counsel for the respondent DDA to respond to the queries raised
during the hearing, the matter was adjourned to 20 th August, 2015 and
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 2 of 25
thereafter to 2nd September, 2015, when after hearing further arguments,
judgment was reserved.
3. It is the case of the petitioner in W.P.(C) No.166/2013:
(i) that it is a Public Sector Undertaking (PSU) engaged in the
business of refining crude oil and marketing petroleum and petroleum
products and has in connection with the said business set up a number
of retail outlets in National Capital Territory (NCT) of Delhi for
marketing transportation fuels i.e. petrol and diesel;
(ii) that the land on which the said outlets are being operated is
owned by government land owning agencies, with the majority of the
sites being owned by the respondent DDA and which sites were
allotted to the petitioner on an annual licence fee basis;
(iii) that the licence / lease was normally granted for a period of five
years with rent / licence fee being revisable after every year;
(iv) that after the year 1994, the annual licence fee was being fixed
by the respondent DDA at the rate prevailing in the year 1994 with an
increase of 8% thereupon every year;
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 3 of 25
(v) that the licence fee is payable yearly in advance, without any
demand notice;
(vi) that as and when rates are revised, interest would also be
charged on late payment of licence fee;
(vii) that the respondent DDA vide its Resolutions No.33/2003 and
58/2004 decided that the reserve licence fee for petrol pumps will be
fixed at 5% of the commercial value of the petrol pump site and in
cases where current commercial value of the land is not available due
to no current disposal in the area, then the current commercial value of
land in the vicinity of the petrol pump site would be taken into
consideration; it was further decided that additional licence fee would
be charged for the commercial component which would be kept as
25% of the licence fee for the area used for commercial purposes, in
addition to the regular licence fee of the petrol pump site; it was also
stipulated that the annual licence fee per sq. mtr. on the basis of Floor
Area Ratio (FAR) of 50 would be Rs.750/- and that annual reserve fee
for a standard size (36x30=1080 sq. mtrs.) land would be Rs.8 lakhs
and that the said rate was to be applicable for a period of five years
with 6% automatic escalation every year;
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 4 of 25
(viii) that in pursuance thereof, vide impugned Circular dated 24 th
September, 2007, the rates of licence fee in respect of already allotted
petrol pumps sites which had completed their initial five years licence
period during 2004-2005 and onwards were revised/refixed;
(ix) that the rates fixed by the respondent DDA were exorbitantly
high as compared to the rates fixed earlier;
(x) that the impugned Circular dated 24th September, 2007 also
stipulated that the Oil Companies would have to pay interest for the
preceding years i.e. 2004-2005, 2005-2006 and 2006-2007 @ 18% per
annum even though, rates had been fixed only on 24 th September,
2007;
(xi) that the petitioner and other Oil Companies had in the past also
been making representations with respect to the exorbitant rentals /
licence fee contending that running a petrol pump is a public utility
service and cannot be treated as a purely commercial proposition;
(xii) that representation was made against the impugned Circular
dated 24th September, 2007;
(xiii) that vide the impugned Circular dated 1 st August, 2011, the
respondent DDA fixed the reserve licence fee for the years 2007-2008,
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 5 of 25
2008-2009, 2009-2010, 2010-2011 and 2011-2012--the rates fixed
were again exorbitantly high being almost four times of the then
prevalent licence fee;
(xiv) that the respondent DDA is calculating the rent on the basis of
FAR of 70, when FAR of 70 has become applicable to NCT of Delhi
only from 2011 onwards and prior thereto, the permissible FAR was
20, again indicating that the licence fee was being fixed without any
application of mind;
(xv) that there is no retail outlet of the petitioner in Delhi which
utilizes or can practically utilize an FAR of 70;
(xvi) that the respondent DDA is thus making the petitioner pay
licence fee on the basis of FAR which is actually not being utilized by
the petitioner;
(xvii) that on representations of the petitioner, the respondent DDA
reduced the rate of interest for the period prior to the date of Circular
dated 24th September, 2007 from 18% per annum to 7% per annum;
(xviii) that the respondent DDA cannot charge interest for the period
prior to the fixation of licence fee and when there was no demand also
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 6 of 25
for the licence fee and axiomatically no default in payment on the part
of the petitioner.
4. The case of the petitioner in the other two petitions is the same.
5. The respondent DDA in its counter affidavit to W.P.(C) No.166/2013
has pleaded:
(a) that the petitioner is liable to pay interest on the amount held by
the petitioner and interest charged @ 7% per annum on the differential
between old and the new licence fee is reasonable;
(b) that the Circular dated 24th September, 2007 merely gives effect
to the Resolutions of the respondent DDA of the year 2003 and 2004;
(c) that the allotment of land by the respondent DDA for running of
petrol pumps and gas filling stations is made on temporary basis under
Rule 44 of the DDA (Disposal of Developed Nazul Land) Rules, 1981
framed under Section 57 of the Delhi Development Act, 1957 (DDA
Act) and have force of law;
(d) that as per the Resolution No.23 dated 13th March, 1987 of the
respondent DDA, the initial period of the licence is kept at five years
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 7 of 25
and after expiry of the said five years, the licence is renewed or
extended at the discretion of the respondent DDA;
(e) that the respondent DDA has also been laying down norms from
time to time for determination of licence fee payable by the allottees
of petrol pumps and the reasons which led to the change in policy of
the respondent DDA are noted in the relevant Resolutions;
(f) that the Resolutions of the respondent DDA were in the full
knowledge of the petitioner and other allottees of petrol pumps;
(g) that determination of licence fee is an executive function and
essentially a policy matter;
(h) that the licence fee has been determined after due application of
mind and based on market value of land;
(i) that the petitioners also do not dispute that the globalised
commercial market value of land taken by the respondent DDA
reflects the true value of land;
(j) that the allottees of the petrol pumps are also utilizing the land
for running ATMs, snacks counter and shopping stores;
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 8 of 25
(k) that the licence fees based on market value may increase or
decrease in comparison to the previous year depending upon the
fluctuations in the land price as is apparent from the reduction of
licence fee for the years 2010-2011 and 2011-2012 as compared to the
year 2009-2010;
(l) that this Court cannot act as an Appellate Authority over the
executive decision arrived at by the respondent DDA in accordance
with the settled law;
(m) that as per Master Plan for Delhi (MPD)-2001, FAR of 20 was
permissible for petrol pumps; at that time the licence fee was
calculated on FAR of 50; thereafter MPD-2021 became operative with
effect from 7th February, 2007 and the permissible FAR for petrol
pumps was increased from 20 to 40; though FAR had been doubled
but the respondent DDA still for the purpose of computation of licence
fee, took FAR of 70 and not of 100;
(n) that while the FAR in the Master Plan stipulated the extent of
construction permissible on the plot for a given land use, FAR for the
purpose of calculation of licence fee is the factor of determination of
the licence fee of the plot depending upon ownership of land etc.--
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 9 of 25
FAR of 70 has been taken for calculation purpose for the period after
the enforcement of new Master Plan only;
(o) that the licence fee being charged is reasonable.
6. Needless to state that similar counter affidavits have been filed in the
other petitions. Need to refer to the rejoinder filed in W.P.(C) No.166/2013
is not felt.
7. The senior counsel for the petitioner in W.P.(C) No.166/2013, besides
arguing on the same lines as the contents of the petition emphasized that
increase in licence fee cannot be effected retrospectively and relied on State
of Rajasthan Vs. M/s. Basant Agrotech (India) Ltd. AIR 2014 SC 487
laying down that the words ―from time to time‖ have a futuristic tenor and
they do not have the etymological potentiality to operate from a previous
date and that the use of the said words in Section 16 of the Rajasthan Finance
Act, 2008 did not confer the jurisdiction on the State Government to issue a
notification in respect of the rate with retrospective effect.
8. The counsel for the petitioners in the other two petitions added that the
petitioners are PSUs and the price of the petrol and petroleum products
retailed at the said sites is relatable to the distribution cost and which
includes the component of licence fee for service station; it was argued that
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 10 of 25
the petitioners are performing a public function and the retrospective
increases in licence fee, after long time, affects the profits of the petitioners.
Attention was also invited to the supplementary affidavit filed by the
petitioner in W.P.(C) No.3546/2013 placing on record the demand notices
issued by the respondent DDA on that petitioner and therefrom it was
contended that the said demand notices are without any bifurcation. It was
further argued that the basic premise on which licence fee had been fixed by
the respondent DDA was wrong.
9. The counsel for the respondent DDA in W.P.(C) No.3546/2013 argued
that the challenge by the petitioner can only be to the decision making
process and not to the decision; that the petitioner in the said writ petition is
only challenging the computation of the licence fee and not the Circulars
dated 24th September, 2007 and 1st August, 2011.
10. The counsel for the respondent DDA in W.P.(C) Nos.166/2013 and
388/2013 argued (i) that as per Section 3 of the DDA Act, DDA consists of
the Lt. Governor of Delhi as its Chairman, a Vice-Chairman, a Finance
Member, a Accounts Member, an Engineer Member, all to be appointed by
the Central Government, two representatives of the Municipal Corporation
of Delhi (MCD), three representatives of the Legislative Assembly of NCT
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 11 of 25
of Delhi; and three other persons to be nominated by the Central
Government having experience of town planning or architecture and the
Commissioner of MCD; (ii) that it is such a body which has passed the
Resolutions on the basis whereof the impugned Circulars have been issued;
(iii) that there is no change in the policy or methodology of fixation of
licence fee--as per the Resolution of 1994 also, licence fee was fixed on the
basis of global rates; (iv) that from 1994 till 2003, only 8% increase in
licence fee was effected every year but the land prices increased at much
more than 8%; (v) that it is not as if the respondent DDA is fixing licence fee
on FAR of 70 when available FAR is 40 only; (vi) that it is only by way of a
formula, inasmuch as the licence fee is computed @ 5% of the FAR of 70
and which works out to 3.5% of the global rate only; (vii) that since the
increase in licence fee remained within the pockets of the petitioners, the
petitioners would axiomatically be liable for interest; (viii) that the
Resolutions of the respondent DDA, laying down the policy, have not been
challenged; (ix) that dismantling of the Administered Price Mechanism
norms which earlier governed the Petroleum Ministry make the earlier policy
redundant; (x) that it is the Vice-Chairman of DDA who has been laying
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 12 of 25
down the licence fee for the petrol pump plots and there is no challenge to
his authority.
11. The senior counsel for the petitioner in W.P.(C) No.166/2013 in
rejoinder invited attention to judgment dated 24th January, 2013 of the
Supreme Court in Civil Appeal Nos.243-247/2003 titled Lala Ram Vs.
Union of India laying down that since the letter / notice dated 7 th August,
1980 of the Northern Railways enhancing the rates of licence fee was
represented against and which representations were partly accepted, the
Railways should not have applied the modified licence fee effective from 7 th
August, 1980 but from the date of the modified decision. It was also his
contention that the petitioner had been paying the licence fee at the old rates
regularly and licence fee has been so paid upto March, 2016.
12. It was in this view of the matter, vide order dated 14 th August, 2015, it
was enquired from the counsel for the respondent DDA, as to how the
respondent DDA in the year 2007-2008, without passing any Resolution
increased the multiplying factor in the licence fee to 70 instead of 40% and
what was the authority of the Vice-Chairman of DDA to do so. It was
further enquired, whether the Oil Companies had been paying the licence fee
at the old rate.
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 13 of 25
13. On 2nd September, 2015, the counsel for the respondent DDA
contended that as per material on record, at least since the year 1994, the
Vice-Chairman of DDA has been laying down the licence fee for the petrol
pump plots except in the year 2004-2005, when the matter was placed before
the respondent DDA for modification of the policy laid down earlier and
there was no challenge to the power of the Vice-Chairman. It was further
stated that the Vice-Chairman of DDA has been approving / laying down the
cost or lease charges for categories of other properties and had also reduced
the licence fee for the year 2006-2007. It was yet further stated that the
Vice-Chairman of DDA has full executive powers of the respondent DDA
and laying down of licence fee by him is not violative of any law.
14. A perusal, in the context of the aforesaid rival contentions, of the
documents filed along with W.P.(C) No.166/2013 shows that as per the
terms and conditions of the letters of allotment of such land issued by the
respondent DDA, the allotment was for a period of five years and though the
annual ground rent payable was mentioned but it was further stipulated
―....and rent shall be revised after every five years‖. The said letters do not
contain any basis on which the rent was to be revised every five years. It thus
appears that the oil companies accepted the allotments agreeing to (i)
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 14 of 25
unilateral revision of rent by the respondent DDA; and, (ii) to payment of
revised rent and if not agreeable to pay the same, to surrender the
land/licence.
15. It is also a term of the said letters of allotment that ―the licence fee
shall be payable yearly in advance without any other demand notice‖.
16. Vide communication dated 29th February, 1994 of the Manager (Land
Management & Accounts) of the respondent DDA, approval by the Vice
Chairman of the respondent DDA of the provisional revised licence fee to be
charged for new allotments made in respect of petrol pump sites w.e.f. 1st
January, 1994 pending revision from the Ministry of Urban Development
and with a provision for 8% increase annually automatically from 1 st
January, 1995 pending revision by the Ministry of Urban Development was
communicated to the oil companies. The same shows that the fixation of
licence fee on 29th February, 1994 was ‗provisional' and was effected by the
Vice Chairman of the respondent DDA and no objection was taken thereto
by anyone.
17. Resolution No.33/2003 of the respondent DDA records (i) that there
was no comprehensive policy framed or rules laid down for allotment of
petrol pumps; however the guidelines for allotment and management were
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 15 of 25
being derived from the instructions and guidelines issued by the Ministry of
Petroleum, from the Resolutions of the DDA, from the guidelines of the
Technical Committee of DDA and from various administrative orders issued
from time to time; (ii) that the allotments were being made on licence fees as
per the licence terms and conditions framed under Rule 44 of the Nazul
Rules, 1981, for an initial period of five years as per Resolution No.23 dated
13th March, 1987; (iii) that the licence fee being demanded was based on
rates prevailing in the year 1994 with a hike of 8% annually; (iv) that the
allotments were being made strictly as per seniority on the wait list; (v)
however since then the retail marketing of motor fuels had been deregulated
and private companies like Reliance Petroleum Limited had been authorised
to set-up the retail outlets and the land owning agencies in neighbouring
States such as NOIDA, HUDA had already allowed private sector oil
companies to be at par with public sector undertakings; (vi) that the licence
fee then being charged was not a true reflection of the commercial value of
the land and many petrol pump sites were being used for other commercial
activities like ATM centers and snack bars which were not allowed as per the
planning norms; (vii) in the wake of deregulation of petroleum sector, a level
playing field had to be provided to all the participants particularly when
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 16 of 25
private companies had been allowed to set-up retail outlets; (viii) in future,
allotment should be made through auction/tender which will determine
market value and would also ensure transparency; (ix) the reserve licence fee
for the petrol pump sites should be fixed at 5% of the commercial value of
the sites and where commercial value of land is not available due to no
current disposals in the area then the current commercial value of the land in
the vicinity of petrol pump sites should be taken; (x) that the licence fee for
the sites already allotted should be revised/fixed at the Reserve Licence Fee
as determined by the Price Fixing Certificate of the DDA with 8% hike
annually and for a period of five years with the sites being brought into the
new price mechanism regime after the said period; (xi) commercial activities
of department stores, convenios, ATMs etc. at the sites be permitted within
the FAR; and, (xii) the additional licence fee for the commercial component
should be kept at 25% of the licence fee for the area used for commercial
purpose in addition to the regular licence fee.
18. Resolution No.58/2004 of the respondent DDA records (i) that the
licence fee at 5% of the market rate proposed in Resolution No.33/3003 was
on FAR of 100; (ii) however planning norms lay down smaller FAR for
petrol pump sites; (iii) the conversion fee for private land was fixed at 25
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 17 of 25
FAR; iv) however for DDA / public land 50% FAR is appropriate as there is
no need to give allowance of 25% of the FAR for ownership of land as in
case of petrol pumps on private land; and, v) keeping in view the fall in the
deposit rate of interest, the annual increase in the licence fee should be
reduced from that contained in Resolution No.33/2003 of 8% to 6%.
19. The impugned circular dated 24th September, 2007, in accordance with
the Resolutions No.33/2003 and 58/2004 informed all concerned the
decision of the DDA to revise/re-fix the rates of licence fee in respect of
already allotted petrol pump sites which had completed initial five years
licence period i) of Rs.8 lacs per annum with annual hike of 6% for
subsequent period of four years, w.e.f. .2004-05; (ii) of Rs.9 lacs with annual
hike of 6% for subsequent four years from the year 2005-06; (iii) of Rs.10
lacs with annual hike of 6% for subsequent period of four years from 2006-
07; and, (iv) that since the licence fee was fixed year to year, demand of
interest at 18% per annum for late payment of licence fee to be raised along
with demand of licence fee for the relevant year.
20. The circular no.19 dated 1st August, 2011 of the respondent DDA fixes
reserve licence fee for petrol pumps sites for the year 2007-08 - 2011-12.
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 18 of 25
21. Supreme Court in (i) Delhi Development Authority Vs. Pushipendra
Kumr Jain 1994 Supp (3) SCC 494 held that the price of land prevailing at
the time of communication of the letter of allotment is the rate payable by an
allottee of land and the reason for this principle is that in case the allottee is
not willing to take or accept the allotment at the rates, it is always open to the
allottee to decline the allotment; (ii) Premji Bhai Parmar Vs. Delhi
Development Authority (1980) 2 SCC 129; and, (iii) M/s. Shri Sitaram
Sugar Co. Ltd. Vs. Union of India (1990) 3 SCC 223 held that it is not the
function of the Court to sit in judgment and interfere in price fixation matters
or over such matters of economic policy and it must be left to the
Government to decide the same.
22. This Court in Jaipur Golden Charitable Clinical Laboratory Trust
Vs. Delhi Development Authority 105 (2003) DLT 277 held that even in the
absence of any provision for revision of the rates, the notified rates are
binding and that the final authority to fix the rates for allotment of land is the
allotting agency and the rates have to be fixed in accordance with the Statute.
The Division Bench dismissed the appeal vide judgment reported as
MANU/DE/3305/2009 observing that no question of estoppel arises.
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 19 of 25
23. In M.P. Housing Board Vs. Anil Kumar Khiwani (2005) 10 SCC 796
Supreme Court again held that time has come when the Courts should be
slow in interfering with schemes which are based on costing.
24. Reference may also be made to Meerut Development Authority Vs.
Association of Management Studies (2009) 6 SCC 171 laying down that
disposal of public property by State or its instrumentalities partakes the
character of a Trust and the Government cannot give a contract or sale or
lease out its properties for a consideration less than the optimum.
25. I, following the aforesaid judgments, in Rishi Pal Vs. Municipal
Corporation of Delhi 177 (2011) DLT 531 (against which LPA
No.404/2011 titled MCD Vs. Charan Singh was dismissed vide judgment
dated 2nd May, 2011) dismissed the petition impugning the demand by the
respondent MCD of the price of plots of land at Ghogha Dairy Project
(Narela), Delhi and in J.B.S. Chauhan Vs. Union of India
MANU/DE/0838/2011 dismissed the petition challenging the price
demanded for additional land allotment whereof was sought by the
petitioner.
26. In Oil and Natural Gas Commission Vs. Association of Natural Gas
Consuming Industries of Gujarat 1990 (Supp) SCC 397 it was observed
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 20 of 25
that price fixation is a legislative function. Even the seven Judge Bench of
the Supreme Court in Prag Ice & Oil Mills Vs. Union of India (1978) 3
SCC 459 observed that unless by the terms of a particular statute, price
fixation is made a quasi-judicial function, it is really legislative in character.
27. If I see the grounds on which the petitioners have challenged the price
increase adopted by the respondent DDA in the context of judgments
aforesaid, no ground for interfering is made out.
28. The petitioners, in accordance with the terms and conditions of the
agreements under which they came to occupy the sites aforesaid, had as
aforesaid empowered the respondent DDA to revise the licence fee from
time to time and without any limitations or guidelines. It is not the case of
the petitioners that the basis of such revision was prescribed in any Rule,
Regulations or Policy of the respondent DDA. In the absence thereof, the
respondent DDA was competent to effect the revision in licence fee on the
basis of prevalent market rent and which in any case the respondent DDA as
per the judgment supra of the Supreme Court is obliged to recover for the
properties held by it in trust.
29. It is also not the case of the petitioners that revision in licence fee
effected by the respondent DDA is higher than the prevalent market prices.
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 21 of 25
All that the petitioners state is that the revision is ―exorbitant‖. However, so
has been the increase in market prices of real estate in the city of Delhi.
Without the petitioners making out a case, of the revision effected by the
respondent DDA being contrary to any law, rule, regulation by which the
respondent DDA was bound and/or establishing that the revision effected in
licence fee was more than the market price, the petitioners have no right in
law to impugn the revision effected.
30. The argument raised by the petitioners on the basis of FAR also, I find
to have no merit. The same, as explained by the respondent DDA in its
counter affidavit, is merely as a factor in computation of licence fee and is
not relatable to the FAR available of the plot.
31. That leaves the question of interest. It is the case of the petitioners that
for revision in licence fee effected retrospectively, no interest for the period
prior to the date of communication on the revision and/or demand and before
which the petitioners could not possibly have made the payment can be
realised.
32. Though the argument, on first blush appears attractive but I am unable
to accept. As already noted above, as per the agreement under which the
petitioners occupy the land the licence fee was payable in advance for each
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 22 of 25
year and without waiting for a demand to be made. Of course there is a delay
on the part of the respondent DDA in determination of the licence fee.
However at the same time such determination is at the market rate for the
relevant year; the respondent DDA, for the previous years, is not charging
licence fee in accordance with the prevalent market rates. If that be so then I
fail to fathom the objection of the petitioners to the demand for interest.
Once the petitioners had agreed to pay the licence fee in advance for each
month without waiting for a demand, if the respondent DDA were to be held
not entitled to claim interest it would amount to respondent DDA getting
towards licence fee something less than the market price. The judgment of
Supreme Court in Basant Agrotech (India) Ltd. & Lala Ram supra cited by
counsels of petitioners were in their own statutory/factual context. It cannot
also be lost sight of that the money which was payable by the petitioners to
the respondent DDA towards licence fee remained in the coffers of the
petitioners and the petitioners continued to reap advantage thereof and ought
not to have any objection to reimburse to the respondent DDA the interest
which the petitioners have earned on the said monies which remained in their
bank accounts.
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 23 of 25
33. The argument raised, of accounting difficulties cannot also be a
ground for relief. The accounting principles admit of making a provision for
disputed/anticipated/contingent liabilities. The respondent DDA had not
done anything to make the petitioners believe that the annual increase in
licence fee at the rate of 8% per annum w.e.f. 1994 was final or
determinative. The petitioners fully knew that the same was only provisional
and licence fee was yet to be fixed by the respondent DDA. The petitioners
ought to have made a provision in their accounts / balance sheets for the
same, in the event of the licence fee fixed by the respondent DDA being
more than the provisional increase which had been effected.
34. The petitioners have been unable to bring anything before this Court
for this Court to hold that the respondent DDA has not acted fairly and
reasonably or has acted arbitrarily and whimsically. The scope of
interference by this Court is limited to the said extent only as also held in
Karnataka Industrial Areas Development Board Vs. Prakash Dal Mill
(2011) 6 SCC 714. This Court cannot possibly go about determining what
was the market price in the relevant year and whether the respondent DDA
has demanded anything more than the market price, particularly when that is
not the plea also of the petitioners. In the context of respondent DDA also,
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 24 of 25
Supreme Court in Delhi Development Authority Vs. Joint Action
Committee, Allottee of SFS Flats (2008) 2 SCC 672 held that only in a case
where fixation of price is required to be made in a particular manner and
upon taking into consideration the factors prescribed and if the price is fixed
de hors the statutory provisions would judicial review be permissible. The
petitioners, I am afraid, have utterly failed to plead or argue that the increase
in licence fee was to be in a particular manner or upon taking into
consideration any prescribed factors and is in violation thereof.
35. Resultantly, the petitions fail and are dismissed; Rule discharged;
however no costs.
RAJIV SAHAI ENDLAW, J.
MAY 11, 2016 ‗bs'/pp..
W.P.(C) Nos.166/2013, 388/2013 & 3546/2013 Page 25 of 25