Calcutta High Court (Appellete Side)
Rupa & Co. Ltd. & Anr vs The State Of West Bengal & Ors on 7 March, 2019
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W.P. No. 3957 (W) of 2013
IN THE HIGH COURT AT CALCUTTA
Constitutional Writ Jurisdiction
Appellate Side
Rupa & Co. Ltd. & Anr.
Vs.
The State of West Bengal & Ors.
For the Petitioners : Mr. Jishnu Saha, Sr. Advocate
Mr. Arindam Banerjee, Advocate
Ms. Arpita Saha, Advocate
Mr. Ishan Saha, Advocate
Mr. S.N. Pandey, Advocate
Mr. Akash Munshi, Advocate
For the State : Mr. Abhrotosh Majumder, Ld. AAG
Ms. S. Mukherjee, Advocate
Mr. Nilotpal Chatterjee, Advocate
Hearing concluded on : January 28, 2019
Judgment on : March 7, 2019
DEBANGSU BASAK, J.:-
The petitioners have assailed the decision of cancellation of
allotment taken in the 67th Meeting of the Board of Directors of the
respondent no. 2 held on July 30, 2012. They have also challenged
the letter dated August 24, 2012 issued by the General Manager (Marketing) - I of the respondent no. 2.
Learned Senior Advocate appearing for the petitioners has submitted that, the petitioner was allotted a plot of land for the purpose of establishing a modern showroom/commercial unit in the action area IIE of Jyoti Basu Nagar (erstwhile New Town), Kolkata. 2 The decision to allot such plot was taken by the Board of Directors of the respondent no. 2 in its 56th Meeting held on December 21, 2010. The first petitioner was allotted 10 cottahs of the land at such area. In its 57th Meeting, the Board of Directors of the respondent no. 2 decided to allot 30 cottahs of land to the first petitioner. The respondent no. 2 allotted 30 cottahs of land bearing Plot No. IIE/17 within action area IIE of Jyoti Basu Nagar (erstwhile New Town), Kolkata on freehold basis at the price of Rs. 4,00,92,000/-. The petitioners paid the entire amount of Rs. 4,00,92,000. Subsequent to the payment of the entire consideration, a joint measurement was undertaken. Subsequently, by the impugned writing dated August 24, 2012, the respondent no. 2 purported to contend that, the policy decision of the respondent no. 2 had allegedly underwent a change. The respondent no. 2 was no longer willing to execute a deed for sale of the land on freehold basis. The respondent no. 2 was willing to grant a long-term lease in respect of the plot. The petitioner had protested against the same.
Learned Senior Advocate appearing for the petitioner has submitted that, a concluded contract came into being between first petitioner and the respondent no. 2 with regard to 30 cottahs plot of 3 land. He has submitted that, the petitioner had discharged all its obligations under such contract. The respondent no. 2 is obliged to execute a deed of conveyance in respect of such plot of land on freehold basis. The subsequent change in policy, cannot override the concluded contract. A party to the contract cannot be allowed to alter the essential terms of the contract unilaterally. In support of his contentions, he has relied upon 2016 Volume 16 Supreme Court Cases page 1 (Bharat Sanchar Nigam Ltd. v. Vodafone ESSAR Gujarat Ltd.).
Learned Senior Advocate appearing for the petitioner has submitted that, right to acquire a property is a right to property and is recognised to be so under Article 300A of the Constitution of India. The so-called change in policy is subsequent to the concluded contract. Such change is immaterial. It cannot affect a concluded contract. In any event, a policy is prospective in nature and cannot override the terms and conditions of a concluded contract. In support of his contentions he had relied upon 1982 Volume 1 Supreme Court Cases page 39 (Bishambhar Dayal Chandra Mohan & Ors. v. State of Uttar Pradesh & Ors.), 2007 Volume 9 Supreme Court 4 Cases page 67 (Chandigarh Housing Board v. Major-General Devinder Singh (Retd.) & Anr.), Learned Advocate appearing for the petitioners has relied upon 2008 Volume 2 Supreme Court Cases page 672 (Delhi Development Authority & Anr. v. Joint Action Committee, Allottee of SFS Flats & Ors.) in support of the contention that, what cannot be done by a regulation cannot be done by an executive action. The State could not have modified the terms of the contract by a law. The State is therefore precluded from setting up the defence of change of policy to deny the just claim of the petitioners.
Learned Additional Advocate General appearing for the respondent no. 1 has submitted that, the first petitioner had approached the respondent no. 2 for allotment of land. Such allotment was made at the request of the first petitioner. Upon the allotment being made, the petitioners did not acquire any right to use, possess or dispose of the immovable property concerned. The State took a decision that, no immovable property will be given away on freehold basis. Grant of any right in respect of an immovable property belonging to the State would be at best on leasehold basis. Such policy decision was taken on July 30, 2011. The joint measurement 5 took place on October 31, 2011. He has submitted that, only upon the joint measurement taking place on October 31, 2011, the right to property of the first petitioner had fructified. However, before the joint measurement, there was a change in the policy of the State. Therefore the parties are guided by the policy obtaining as on October 31, 2011. The respondents are acting in terms of the policy decision as obtaining on October 31, 2011 that is, grant of an immovable property on leasehold basis. Therefore, there is no infirmity in the actions taken by the respondents warranting an interference by the Writ Court. The respondents are agreeable to execute a long-term lease for the land in terms of the policy decision taken on July 30, 2011. Consequent upon the policy dated July 30, 2011, a revised offer was made to the petitioners on August 24, 2011. He has highlighted the fact that, the petitioners have taken a stand that, there is no difference between a long-term lease and a deed of conveyance on freehold basis. Therefore, he has submitted that, the petitioners may be permitted to obtain the long-term lease in respect of the immovable property concerned. Since, the petitioners do not find any difference, therefore, the petitioners have no cause of action to approach the Writ Court. He has submitted that, the offer letter 6 dated April 6, 2011 cannot qualify as a property within the meaning of Article 300A of the Constitution of India. In support of his contentions, he has relied upon 1995 Supp (1) Supreme Court Cases page 596 (Jilubhai Nanbhai Khachar & Ors. v. State of Gujarat & Anr.). According to him, contract is not a property. In any event, there was no concluded contract between the parties requiring the respondents to transfer the immovable property on freehold basis as sought to be contended by the petitioners. He has relied upon 1984 Volume 1 Supreme Court Cases page 515 (State of Tamil Nadu & Ors. v. L. Abu Kavur Bai & Ors.) in support of his contentions as to how an allotment in respect of an immovable property is required to be treated. He has referred to Article 39B of the Constitution and 2011 Volume 5 Supreme Court Cases page 29 (Akhil Bhartia Upbhokta Congress v. State of Madhya Pradesh & Ors.), 2018 Volume 12 Supreme Court Cases page 85 (Indian Oil Corporation Ltd. & Ors. v. Shashi Prabha Shukla & Anr.). He has referred to 2009 Volume 7 Supreme Court Cases page 205 (General Manager, Uttaranchal, Jal Sansthan v. Laxmi Devi & Ors.) and has submitted that, judgments are prospective in nature.
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Learned Advocate appearing for the respondent nos. 2 to 8 has submitted that, contractual rights are not capable of being protected under Article 300A of the Constitution. He has relied upon All India Reporter 1954 Supreme Court page 92 (State of West Bengal v. Subodh Gopal Bose & Ors.), All India Reporter 1951 Supreme Court page 41 (Chiranjit Lal Chowdhuri v. Union of India & Ors.), All India Reporter 1963 page 864 (Swami Motor Transport (P) Ltd. & Anr. v. Sri Sankaraswamigal Mutt & Anr.) in support of such contentions. As to what constitutes a property, learned Advocate appearing for the respondent nos. 2 to 8 has relied upon All India Reporter 1995 Supreme Court 142 (Jilubhai Nanbhai Khachar v. State of Gujarat & Anr.), 2006 Volume 2 Calcutta High Court Notes page 161 (Kanta Devi Berlia v. Mohit Jhunjhunwalla & Ors.). He has submitted that, an agreement to purchase does not create any right or interest or charge on an immovable property. Therefore, according to him, the writ petition is not maintainable. The petitioners are seeking to enforce private law rights. The right according to the petitioner flows out of a contract which is not statutory in nature. He has relied upon All India Reporter 2012 Calcutta page 36 (Smt. Jayanti Paul & Ors. v. Kolkata 8 Metropolitan Development Authority & Ors.) in support of his contentions.
Drawing the attention of the Court to the fact that, assuming that, there is a concluded contract learned Advocate for the respondent nos. 2 to 8 has submitted that, such concluded contract is unstamped. An unstamped agreement for sale is liable to be impounded and appropriate measures taken with regard thereto. In support of his contentions, he has relied upon an unreported decision of the Division Bench rendered in 2017 Volume 1 W.B.L.R. (Cal.) page 688 (Darothi Mukherjee (Karmakar) v. Ajoy Kumar Ghosh & Ors.) and 2011 Volume 14 Supreme Court Cases page 66 (SMS Tea Estates Pvt. Ltd. v. Chandmari Tea Company Pvt. Ltd.).
Referring to the facts of the present case, learned Advocate appearing for the respondents nos. 2 to 8 has submitted that, a Writ Court ordinarily should not enter into the arena of specific performance of a contract. In the facts of the present, the petitioners are essentially seeking specific performance of a contract.
Learned Senior Advocate appearing for the petitioners has relied upon Delhi Development Authority & Anr. (supra) in support of the contention that, an executive decision cannot be retrospective in 9 nature. Moreover, a concluded contract cannot be unilaterally modified.
The petitioner had approached the State Government for allotment of land at Jyoti Basu Nagar. Initially 10 cottahs of land was allotted to the first petitioner. Thereafter, the allotment was changed to 30 cottahs of land. The allotment was for the purpose of establishing a modern showroom/commercial unit of Jyoti Basu Nagar. The decision to make the allotment in favour of the first petitioner was taken on December 30, 2010, in the 57th Meeting of the Board of Directors of the respondent no. 2. There was a Loksabha election in the year 2011.
By a letter dated April 6, 2011, the respondent no.2 had informed the first petitioner that, 30 cottahs of land at Jyoti Basu Nagar would be transferred to the first petitioner on freehold basis for establishing a modern showroom/commercial unit for various innovative products under the principal use 'business' at the price of Rs. 4,00,92,000/-. The first petitioner had accepted the same. It had proceeded to make payment of the first installment of Rs. 1,00,23,000/- on April 18, 2011. The final installment was paid by the first petitioner on June 27, 2011 being the sum of Rs. 10 3,00,69,000/-. The first petitioner had received the postal envelope containing the pay order for the final installment as the respondent no. 2 refused to accept the same. Thereafter, the first petitioner had written a letter dated July 15, 2011 requesting clarification from the respondent no. 2 as to why the respondent no. 2 was not accepting the final payment of the installment. Subsequently, the respondent no. 2 had accepted the final installment which was tendered to the respondent no. 2 under cover of a letter dated September 12, 2011. The first petitioner thereafter had called upon the respondent no. 2 to take necessary steps as the first petitioner had paid the entire consideration. Such request was contained in the writing dated September 22, 2011. The respondent no. 2 by a letter dated October 31, 2011 had called upon the first petitioner to obtain a date for joint measurement of the land allotted to the first petitioner. The joint measurement of the plot of land was made in presence of the parties in or about January 2012. By a letter dated August 24, 2012, the respondent no. 2 had informed the first petitioner that, as the letter of allotment issued on April 6, 2011 which was during the period when the Model Code of Conduct for election was in place, the original letter of allotment cannot be acted upon. In any event, the Board of 11 Directors of the respondent no. 2 in its 67th Meeting held on July 30, 2012, had reviewed the entire matter and decided that, the allotment of the land to the first petitioner would be on lease basis instead of freehold basis. Diverse correspondence had ensured between the parties thereafter. The petitioners thereafter had approached the Writ Court.
Akhil Bhartia Upbhokta Congress (supra) has considered the issue of allotment of land, grants and permits under the touchstone of Article 14 of the Constitution of India. It has held that, allotment of land and grants by the Government must be founded by sound, transparent, discernible and well-defined policy and that, such policy should be made known to the public by notification in the official gazette and other recognised modes of publicity. Such policy must be implemented in a non-discriminatory and non-arbitrary manner. It is essential that, fairness and equity in action are exercised. When there is a requirement to exercise discretion, then such discretion is to be exercised uninfluenced by favourtism or nepotism. It has also held that, the policy of allotting land on the basis of applications made by individuals dehors an invitation or advertisement by this State is arbitrary discriminating and an act of favourtism violating Article 14 12 of the Constitution. Shashi Prabha Shukla & Anr. (supra) has considered the modes of allocation of Government largesse. It has held that a public authority in its dealings has to be fair, objective, non-arbitrary, transparent and non-discriminatory. The discretion vested in such an authority, which is a concomitant of its power is coupled with duty and can never be unregulated or unbridled. Any decision or action contrary to these functional percepts would be at the pain of invalidation thereof. The State and its instrumentalities, be it a public authority, either as an individual or a collective has to essentially abide by this inalienable and non-negotiable prescriptions and cannot act in breach of the trust reposed by the polity and on extraneous consideration.
National resources of the nation are required to be dealt with by the Government both at the Centre and as well as the State, by observing a transparent and unbiased manner of disposal. Public auction is not the only model or manner of grant of Government largesses. However, Government largesse is required to be granted in a manner which is transparent and consonant with the policy with regard thereto which is in public domain. It is so required so as to ensure that, transparency is maintained in grant of Government 13 largesse. The public at large knows the rationale behind the grant of a public largesse in favour of any entity. Grant of public largesse cannot be left at the whims and caprice of the executive and for that matter any person. Grant of public largesse should ideally be done through a selection process, the parameters of which are made known to the public prior to the initiation of such selection process, and the grant is made in terms of a declared policy. As noted above, public auction is not the only manner in which a Government largesse can be granted. Where a Government largesse is sought to be granted by a route other than public auction, that also, the Government must make know to the public at large about the selection process employed for the purpose of grant of such Government largesse.
In the present case, an unilateral approach by the petitioners for grant of allotment of land resulted in the grant of the same initially on freehold basis and thereafter on leasehold basis. No selection process was undertaken for the grant of such plot of land in favour of the first petitioner. The criteria for the selection process were not made known to the public at large. The public at large did not have the benefit of participating in the selection process. The selection of the first petitioner for allotment of the land, whether on freehold basis or on 14 leasehold basis, being vitiated, by reason of the lack of transparency in the selection, a writ Court need not exercise extraordinary prerogative writ jurisdiction, in order to enforce any right that may have been created in favour of any person, in relation to such a transaction. The transaction itself being opaque, a writ Court cannot be called upon to enforce the respective rights of the parties, in relation to such an opaque transaction. On such ground alone, the writ petitioner fails.
Bishambhar Dayal Chandra Mohan & Ors. (supra) has examined the scope and extent of executive power of the State under Article 162 of the Constitution, in relation to regulation and control of trade and commerce in foodstuffs. It has taken note of Article 300A of the Constitution. It has held that, Article 300A provides that no person shall be deprived of his property save by authority of law. The State Government cannot, while taking recourse to the executive power of the State under Article 162, deprive a person of his property. Such power can be exercised only by authority of law and not by a mere executive fiats or orders. It has read Article 162 to mean that, it is subject to other provisions of the Constitution. Article 162 is therefore subject to Article 300A. It has held that, the word 'law' in 15 the context of Article 300A must mean an Act of Parliament or of a State Legislature, a rule, or a statutory order, having the force of law, that is positive or State made law. Illegal seizure amounts to deprivation of property without the authority of law. Chandigarh Housing Board (supra) has held that, although the right to acquire a property is not a fundamental right, but is a constitutional and human right. Therefore a person can be deprived of his right to acquire property, if the law and a contract expressly and explicitly state so.
Jilubhai Nanbhai Khachar & Ors. (supra) has explained the term property as used in Article 300A of the Constitution of India. It has held that, property in the legal sense means an aggregate of rights which are guaranteed and protected by law. The exclusive right of possessing, enjoying and disposing of a thing is property in legal parameters. It has also held that, the word 'property' used in Article 300A must be understood in the context in which the sovereign power of eminent domain is exercised by the State and property expropriated. No abstract principles can be laid down. Each case must be considered in the light of its own facts.
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Subodh Gopal Bose & Ors. (supra) has held that, Article 31 of the Constitution is designed to protect the rights to property against deprivation by the State acting through its executive organ, the Government. Clause (2) of Article 31 imposes two further limitations on the Legislature itself. It is prohibited from making a law authorising expropriation except for public purposes and on payment of compensation for the injury sustained by the owner. These important limitations on the power of the State, acting through the executive and legislative organs, to take away private property are designed to protect the owner against arbitrary deprivation of his property. Clauses (1) and (2) of Article 31 are thus not mutually exclusive in scope and content, but should be read together and understood as dealing with the same subject, namely, the protection of the right to property by means of the limitations on the State power. The deprivation contemplated in Clause (1) being no other than the acquisition or taking possession of property referred to in Clause (2).
Swami Motor Transport (P) Ltd. & Anr. (supra) has held that, the law of India does not recognise equitable estates. It does not recognise that, the statutory right to purchase land is, or confers, an 17 interest or a right in property. The fact that the right is created not by contract but by a statute cannot make a difference in the content or the incident of the right. That depends upon the nature and the scope of the right conferred. The right conferred is a right to purchase land. If such a right conferred under a contract is not a right of property, the fact that such a right stems from a statute cannot obviously expand its content or make it any the less a non-proprietary right. The statutory right to apply for the purchase of land is not a right of property. The contract to purchase a property does not create an interest in immovable property. Kanta Devi Berlia (supra) has held that, an agreement for sale of the immovable property does not, by itself, create any interest in or charge on such property. Bharat Sanchar Nigam Ltd. (supra) has held that, an unilateral modification to a concluded contract does not alter the concluded contract.
L. Abu Kavur Bai & Ors. (supra) has explained the word 'distribution as used in Article 39(b) of the Constitution. It has held that, it would not be correct to construe the word 'distribution' in a purely literal sense so as to mean only division of a particular kind or to particular persons. The words, apportionment, allotment, 18 allocation, classification, clearly fall within the broad sweep of the word 'distribution'. So construed, the word 'distribution' as used in Article 39(b) will include various facets, aspects, methods and terminology of a broad-based concept of distribution. In other words, the word 'distribution' does not merely mean that property of one should be taken over and distributed to others like land reforms where the lands from the big landlords are taken away and given to landless labourers or for that matter the various rural ceiling Acts. That is only one of the modes of distribution but not the only mode. Chiranjit Lal Chowdhuri (supra) has considered Article 31 of the Constitution. It has considered whether, the shareholders' right to elect a director is a property or is to be construed to be a right to property. It has held that, the right of shareholder to elect a director is a privilege incidental to the ownership of the share which itself is property, but it cannot be said that this right, by itself, and apart from the share property within the meaning of Article 31. Article 31 regard that as property which can by itself be acquire, disposed of or taken possession of. The right to vote for the election of directors, the right to pass resolutions and the right to present a petition for winding up are personal rights flowing from the ownership of the 19 share and cannot by themselves and apart from the share be acquired or disposed of or taken possession of as contemplated by Article 31.
Since, the petitioner is seeking to enforce a so-called contract entered into between the petitioner and the authorities, which such contract, in my view, could not have been entered into by the authorities, the applicability of the ratio laid down in the other authorities cited before the Court, need not be discussed.
In such circumstances, the petitioner is not entitled to any relief in the present writ petition.
W.P. No. 3957 (W) of 2013 is dismissed. No order as to costs. Urgent certified website copies of this judgment and order, if applied for, be made available to the parties upon compliance of the requisite formalities.
[DEBANGSU BASAK, J.]