Allahabad High Court
Vanalika Developers Private Limited vs State Of U.P. And 4 Others on 2 September, 2024
Author: Mahesh Chandra Tripathi
Bench: Mahesh Chandra Tripathi
HIGH COURT OF JUDICATURE AT ALLAHABAD Neutral Citation No. - 2024:AHC:141503-DB Reserved on 21.08.2024 Delivered on 02.09.2024 Case :- WRIT - C No. - 10498 of 2020 Petitioner :- Vanalika Developers Private Limited Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Abhishek Gupta,Prashant Sharma Counsel for Respondent :- Aditya Bhushan Singhal,C.S.C.,Kartikeya Saran Hon'ble Mahesh Chandra Tripathi,J.
Hon'ble Prashant Kumar,J.
1. Heard Shri V.K. Singh, learned Senior Advocate assisted by Shri Abhishek Gupta & Shri Harsh Kumar Thapar, learned counsel for the petitioner, Ms. Uttara Bahuguna, learned Additional Chief Standing Counsel for State respondent no.1, Shri M.C. Chaturvedi, learned Senior Advocate assisted by Shri Aditya Bhushan Singhal and Shri Pranav Tanwar, learned counsel for the respondent nos.2 & 3 and Shri Kartikeya Saran, learned counsel for the respondent no.4.
FACTUAL MATRIX
2. The Yamuna Expressway Industrial Development Authority (in short, YEIDA) floated a scheme for allotment of residential township being Scheme Code No.YEA-RT-03/2011, wherein a number of residential township plots were offered. In response to it, the consortium of four companies, in which M/s Sunworld Infrastructure Limited was a lead member, had applied for a plot admeasuring about 100 acres being plot number TS - 7, Sector - 22-D. In response to this application, the YEIDA issued a reservation letter on 30.03.2011 for allotment of the said plot. Thereafter, an allotment letter was issued by YEIDA on 16.08.2011 in favour of consortium of four companies i.e. M/s Sunworld Infrastructure Ltd., M/s Vanalika Infrastructure Pvt. Ltd., M/s Vanalika Developers Pvt. Ltd. & M/s Odeon Builders Pvt. Ltd. The total cost for the plot was Rs.205 crores.
3. The consortium of four companies made a Special Purpose Company (hereinafter referred as SPC) known as M/s Sunworld City Pvt. Ltd. and this information was given to respondent no.2 to accord approval to the SPC and the same was accorded on 14.09.2012. Thereafter, lease deed was executed on 14.09.2012 between respondent no.2 and M/s Sunworld City Pvt. Ltd. being Lead member of SPC of M/s Sunworld Infrastructure Ltd., having 51% share, M/s Vanalika Infrastructure Pvt. Ltd. having 29% share, M/s Vanalika Developers Pvt. Ltd. having 15% share and M/s Odeon Builders Pvt. Ltd. having 5% share, on 'as is where is' basis. However, there was a specific condition that the lessee shall commence construction of the F.A.R. within 18 months from the date of possession and shall complete the construction as per approved layout plan and get the occupancy certificate in 7 phases within a period of 10 years from the date of execution of lease deed. Clause 23 of this lease deed made it clear that in case, the lessee does not complete the construction within time frame then the lease deed would liable to be cancelled.
4. For a portion of land there was a stay order passed by this Court in some litigation, hence, the respondent no.2 was not in a position to handover the same, so, respondent no.2 informed this to the SPC and asked them to execute the lease deed for the remaining land for which they agreed and executed the deed.
5. It is apparent from the record that the SPC did not pay up the instalments in time and sought for extension of time for paying up the instalments, the extension was granted but still certain instalments were not paid. While granting the extension, respondent no.2 made it clear that the allottee SPC had given an undertaking that they will pay the future instalments as per the schedule of the lease deed along with penal interest.
6. On 01.02.2012 a letter for cancellation was sent to the allottee as they did not pay the outstanding dues in time. This cancellation order was challenged by the SPC, M/s Sunworld City Pvt. Ltd. in Civil Misc. Writ Petition No.7221 of 2012 in which the Division Bench of this Court on 01.06.2012 had passed the following order:-
"On the joint request made by the learned counsel for the parties, put up this case on 3.7.2012 . In the meantime, the petitioner shall deposit the balance amount of the allotment money alongwith penal interest due thereon from the due date till the date of deposit within a week. Any amount deposited in the meanwhile towards the balance amount of allotment money shall be given adjustment. The petitioner shall deposit one year lease rent and the stamp duty/ stamp papers for execution of the lease-deed.If the amount of allotment money alongwith penal interest is deposited, then the Yamuna Expressway Industrial Development Authority. shall execute the lease deed infavour of the petitioner and also deliver the possession of the land which is undisputed and the Yamuna Expressway Industrial Development Authority is in a position to deliver the possession without contravening the interim order passed by this Court in which the possession of the land has been claimed by the tenure holder. The petitioner may consider as to whether they would like to stake their claim on the entire area of land allotted to them or would be satisfied with the area of which the possession has been given to them. The quantum of the first instalment alongwith interest payable thereon shall be decided on the next date. On deposit of the balance amount of allotment money alongwith penal interest, the cancellation of allotment letter shall stand set aside.
This order has been passed in presence of the Sri C.B. Yadav learned Addl. Advocate General assisted by Sri Suresh Singh on behalf of respondents."
7. In compliance of order dated 01.06.2012, respondent no.2 intimated that out of the allotted area of 4,14,538 sq. mtrs. an area of 2,63,483 sq.mtrs. is available for execution of lease deed and further it was informed that out of the total allotted area, 1,51,055 sq. mtrs. is under litigation and further letter dated 14.08.2012 was issued stating therein to complete the necessary formalities so that the lease deed can be executed. Thereafter, the allottees completed all the formalities as stated in the check list and lease deed was executed in favour of respondent no.4 on 14.09.2012, for plot no.TS-07, Sector-22D, (area 2,63,483 sq.mtrs.) and the possession of the land was also handed over to the allottee on 14.09.2012.
8. The consortium of the allottee companies, which was already incorporated as SPC, known as M/s Sunworld City Pvt. Ltd., had on 20.08.2019 made a request to surrender plot no.TS -7, Sector-22D, wherein it was cited that since there was a litigation on the plot, and an additional compensation was added. Apart from it, the majority shareholders were not turning up to give consent to infuse the funds for further development in the project and with this they requested for surrendering the said plot. The request made by the SPC vide letter dated 22.08.2019 was put up in 66th board meeting dated 21.12.2019 in which the board of YEIDA resolved as follows:-
"M/s Sunworld Infrastructure Ld. को उनके द्वारा जमा मूल धनराशि में से 15 प्रतिशत धनराशि की कटौती करते हुए अवशेष धनराशि वापिस की जाये। इस धनराशि में ब्याज, दण्डात्मक ब्याज, लीज रेन्ट, स्टाम्प शुल्क आदि वापिस नहीं होंगे। पहले M/s Sunworld Infrastructure Ltd. को उनके 218 आवंटियों को वापिस की जाने वाली धनराशि के समतुल्य धनराशि ही लौटायी जायेगी। अवशेष धनराशि इसके वाद ही प्राधिकरण द्वारा लौटायी जाये।"
9. The Resolution of the Board was in two parts, firstly, it accepted the request for surrender of the plot and secondly, the board resolved that 15% deduction would be made from the total amount deposited by the allottee and the rest of the amount would be refunded. It was also made clear that the amount refunded will not include interest, penal interest, lease rent, stamp duty etc. It was further resolved that firstly, the amount equivalent to be refunded to the 218 allottees would be refunded and, thereafter, the remaining amount would be paid back to the allottee.
10. Thereafter, the petitioners have filed a writ petition being Writ-C No.42959 of 2019 (Vanalika Developers Pvt. Ltd. v. State of U.P. and 4 others), which was disposed of vide order dated 02.01.2020. For ready reference the order dated 02.01.2020 is quoted hereunder:-
"This writ petition has been filed, inter alia, for the following reliefs;
"a) issue a writ, order or direction in the nature of Certiorari directing the Respondent No. 2 to refrain from taking any action on impugned letter dated 20.8.2019 sent by the Respondent No. 4 for all intents and purposes; and
b) issue a writ, order or direction in the nature of Certiorari directing the Respondent No. 2 to refrain from taking any action on the applications filed by present management of Respondent No. 4, without following the due process of law and after taking into full consideration the rights, interests and grievances of the stakeholders and shareholders, buyers/customers of Respondent No. 4 for all intents and purposes;"
Learned counsel for the petitioner has confined his prayer to the extent that the petitioner may be permitted to make a fresh representation before the Respondent No. 2/concerned authority in respect of his grievances with a direction to the Respondent No. 2/concerned authority to decide the same within a stipulated period.
Sri Suresh Singh, learned counsel for the Respondents No. 2 and 3 stated that he has no objection to the prayer made by the learned counsel for the petitioner.
Heard learned counsel for the petitioner, Sri Suresh Singh, learned counsel for the Respondents No. 2 and 3 and perused the record.
Considering the facts and circumstances of the case, petitioner is directed to make a fresh representation before the Respondent No. 2 ventilating its grievances within ten days from today along with a certified copy of this order enclosing therewith a copy of the writ petition and its Annexures and, if any such representation is made, the said authority shall make all endeavour to consider and decide the same by a reasoned and speaking order after giving an opportunity of hearing to the petitioner in accordance with law expeditiously preferably within six weeks from the date of receipt of the said representation.
It is open for the petitioner to take all legal pleas and produce any document in support of its contention before the said authority in accordance with law.
We make it clear that we have not entered into the merits of the case and the same shall be decided by the Respondent No. 2 on its own merits.
With this observation, this writ petition stands finally disposed of."
11. In response to aforesaid order, the petitioner made a fresh representation before the Chief Executive Officer, YEIDA on 17.02.2020. In the meanwhile, there was an inter se dispute between the consortium members, and one of the consortium member had taken the lead member to the National Company Law Tribunal, Allahabad in CP No.305/ALD/2019. In the meanwhile, in the 67th Board Meeting held on 29.12.2020 a decision was taken by the board of respondent no.2, wherein they had modified the earlier board resolution dated 21.12.2019 to the extent that the refund to be given was kept in abeyance till final decision in the company petition pending before the NCLT, Allahabad.
12. The Chief Executive Officer, YEIDA vide order dated 20.04.2020 after hearing the petitioner at length was pleased to reject the representation filed by the petitioner on the ground that the board in its 66th meeting held on 21.12.2019 had already accepted the surrender and had also accepted to refund the amount paid by the allottees after deducting certain amount as per law. Further, as per the board meeting dated 29.12.2020 the order of earlier meeting was modified to the extent that the refund would not be paid till the final decision of the matter pending before the NCLT, Allahabad. On this ground the representation of the petitioner was rejected.
13. The petitioner, who is just a member of the consortium, and a minor shareholder of the SPC (15%) has challenged the order dated 20.04.2020 by means of instant writ petition and sought the following reliefs:-
"a) issue a writ, order or direction in the nature of certiorari quashing the impugned order dated 20.04.2020 passed by respondent no.2 alongwith surrender letter dated 20.08.2019 sent by respondent no.4 and direct the respondent no.2 to refrain from taking any action on letter dated 20.08.2019 sent by the respondent no.4 for all intents and purposes; and
b) issue a writ, order or direction in the nature of certiorari or any other appropriate writ directing the respondent no.2 to hand over complete possession of allotted land bearing plot no.TS-7, Sector-22D, Yamuna Expressway, U.P., admeasuring 4,14,538 sq.mtrs. Free from all encumbrances with all promised facilities on the same terms as Scheme Code No.YEA-RT-03/2011 becoming effective from the date of handing over of complete possession of land and adjusting the previous deposited amount against outstanding dues, for all intents and purposes;
c) Award compensation of Rs.10 crores for causing harrassment, mental agony and loss of reputation and goodwill alongwith costs of the petition to the petitioner;"
ARGUMENT OF THE PETITIONER
14. Mr. V.K. Singh, learned Senior Advocate assisted by Mr. Abhishek Gupta, learned counsel for the petitioner submitted that since the entire possession of the land was not given and was scattered in different portions and the basic infrastructure was not provided, hence, it was not possible for them to develop the land. However, the petitioner now is ready and willing to pay the entire outstanding amount and requested to handover the complete possession of the allotted land to the petitioner free from all encumbrances as per the Scheme of 2011.
15. Learned counsel for the petitioner further submitted that the complete possession of the land was not given by respondent no.2 and, hence, the entire blame of not completing the project cannot be fastened on respondent no.4 and 5 but respondent no.2 is solely responsible for the same. He further submitted that respondent no.2, who is State should act fairly and also keep into consideration the interest of the shareholders, stakeholders and the allottees.
16. Learned counsel for the petitioner submits that respondent no.4, SPC had issued a letter on 20.08.2019 without following the due process of law, as neither AGM/EGM was ever called, nor any notices were issued to the shareholders with the specific agenda of surrendering the said plot. By surrendering the said plot, respondent no.4, SPC has completely failed in its aims and objects as the same was incorporated only to develop the said land. The management of respondent no.4 has virtually rendered the SPC as defunct which caused irreparable loss and damage to the rights of the petitioner, shareholders, stakeholders, and the allottees. Because of this maloperation and mismanagement of the SPC the petitioner had no other alternative but to file a petition before the NCLT, Allahabad being CP No.305/ALD/2019.
17. He further submitted that respondent no.2, which is state instrumentality, is bound to act fairly and also to keep the interest of the other stakeholders in mind, before passing and accepting the surrendering letter.
ARGUMENT OF THE RESPONDENT
18. Shri M.C. Chaturvedi, learned Senior Advocate assisted by Shri Aditya Bhushan Singhal and Shri Pranav Tanwar, learned counsel for the State-respondent no.3 submitted that the application for the allotment of the plot was moved jointly by four companies as a consortium and the plot was allotted in favour of the consortium consisting of four companies and different shares i.e. M/s Sunworld Infrastructure Ltd. (51%), M/s Vanalika Infrastructure Pvt. Ltd. (29%), M/s Vanalika Developers Pvt. Ltd. (15%), M/s Odeon Builders Pvt. Ltd. (5%).
19. The consortium was supposed to make a SPC to execute the project, and accordingly, a SPC was constituted by the consortium in the name of M/s Sunworld City Pvt. Ltd. The formulation of SPC was accepted and approved by the YEIDA and, thereafter, a lease deed was also executed between YEIDA and the SPC.
20. Right from the beginning the allottees were defaulting in making the payments. Time and again they were granted extensions and still the payment was not made as per the schedule. In the meanwhile, there was litigation and because of an interim order passed by this Court, the entire 100 acres could not be handed over to the SPC. However, this was accordingly informed to the allottees and allottees agreed that the portion of the land, which was free from all encumbrances, may be allotted to them. Thereafter, the possession was handed over on the basis of 'as is where is'.
21. He further contended that there was a dispute between the consortium members of the SPC. The SPC, which was the face of the consortium members, had moved an application for surrendering the plot on 20.08.2019. At that point of time the total payment outstanding against the allottee company was Rs.342.71 crores towards premium, Rs.116.63 crores towards additional compensation and Rs.21.02 crores towards the lease rent.
22. Mr. M.C. Chaturvedi, learned Senior Advocate further submitted that the application was made on behalf of the consortium and the plot was allotted to the consortium, which later on took shape of a SPC and for all practical purposes this SPC was an allottee of the plot. Once the allottee moved an application for surrendering of the plot, which was duly considered and approved in the board meeting of the YEIDA, it was not open for one of the small shareholder in the consortium (who was not even a lead member) to challenge the request letter of association or the board approval of its suspension. The petitioner has, therefore, no locus to file the instant petition or ask for quashing of the board resolution by which the surrender was approved.
23. He further argued that it is not open for a member of the consortium to challenge any action taken by the allottee company, which was the Special Purpose Company. Any interse dispute between the members of the consortium has to be sorted out amongst themselves or in any other forum, but no relief can be granted by this Court, especially under the writ jurisdiction.
24. He also submitted that since the petitioner was neither an applicant nor an allottee, hence, the prayer made by him that he is ready and willing to pay the entire amount, which was due towards the consortium or SPC and the deed may be executed in his favour, cannot be accepted, as individually he is alien to the present dissension.
25. He lastly submitted that this writ petition is misconceived as the decision taken in the 66th board meeting dated 22.12.2019 has not been challenged. The petitioner has only challenged the order passed on 20.04.2020 on his representation, which was nothing but a fall out of the board decision taken on 21.12.2019 and 29.02.2020 in the 66th and 67th Board Meeting. In view of this, the writ petition should be dismissed on the ground of being misconceived.
26. We have carefully considered the submissions advanced by the learned counsel for the respective parties. With their able assistance, we have proceeded to peruse the pleadings, grounds taken in the petition, annexures appended thereof, the reply filed by the respondent authorities and also the rejoinder affidavit filed by the petitioners.
ANALYSIS
27. Undoubtedly, an application was made by the consortium of four companies for allotment of plots for developing the residential township. Once the application was approved, a letter of allotment was issued on 16.08.2011 to the consortium of these four companies. Later on the consortium had incorporated the SPC, which became an interface between respondent no.2 and the consortium. This SPC was called M/s Sunworld City Pvt. Ltd. A lease deed was executed between YEIDA and the SPC, M/s Sunworld City Pvt. Ltd. and, hence, the respondent no.4 (SPC) was the allottee of the said land for all legal purposes. Undisputedly, the allottee company did not pay the installments in time as scheduled in the lease deed and sought for extension of time, which was granted.
28. It is also not in dispute that because of some pending litigation the possession of entire 100 acres could not have been given to the allottee, so respondent no.2 had offered them to take a smaller plot, which was free from all encumbrances. This offer was agreed by respondent no.4 and the respondent no.2 executed a deed on 14.09.2012 with the SPC and handed over possession of the land, which was free from all encumbrances on the basis of 'as is where is'.
29. It is also evident that there was some interse dispute between the parties. Infact the petitioner herein, who is a small shareholder of the consortium/SPC, had filed a company petition before the NCLT, Allahabad for oppression and mismanagement by the directors of respondent no.4 and the same is still pending.Thereafter, the Special Purpose Company (allottee), M/s Sunworld City Pvt. Ltd. had moved an application on 20.08.2019 seeking surrender of the said plot and sought refund of the amount. In the application moved by respondent no.4 (SPC), it was mentioned that they could not complete the project because of various problems of getting possession of the land and also because the other consortium members were not ready to pay the premium amount. This matter was placed before the board of YEIDA. The YEIDA in its 66th board meeting held on 21.12.2019 resolved to accept the surrender of the plot and also directed that the amount so deposited by the allottee may be refunded by deducting 15% from the total amount, which will not include interest, penal interest, lease rent, stamp duty etc.
30. The petitioner herein, who is only 15% partner of the consortium and 15% shareholder of the SPC, moved an application with YEIDA with a request not to consider the surrender offered by the SPC/allottee.
31. It is borne from the record that the petitioner had also filed a writ petition being Writ-C No.42959 of 2019 (Vanalika Developers Pvt. Ltd. v. State of U.P. and 4 others), which was disposed of vide order dated 02.01.2020 directing the petitioner to file a fresh representation before respondent no.2, who would decide the same.
32. In the meanwhile, it was brought to the notice of the YEIDA that the petitioner had also filed CP No.305/ALD/2019 before NCLT, Allahabad against SPC, M/s Sunworld City Pvt. Ltd, which was still pending. When this fact was brought to the notice of YEIDA, the board in its 67th meeting held on 29.02.2020, resolved to modify the board resolution dated 21.12.2019 and held that the refund, which was supposed to go to the SPC, would be held back till the decision by NCLT, Allahabad in CP No.305/ALD/2019.
33. The representation given by the petitioner on 17.03.2020 was finally heard and decided vide order dated 20.04.2020 in which it was informed that the board had already taken a decision and, accordingly, his representation was rejected.
34. The petitioner herein although has challenged the order dated 20.04.2020 but has chosen not to challenge the board resolution dated 21.12.2019 (passed in 66th meeting) and board resolution dated 29.12.2020 (passed in 67th meeting) whereby the surrendering of the plot was accepted and the refund of the payment was ordered. In the absence of challenge to the resolutions dated 21.12.2019 and 29.02.2020, the petitioner has himself allowed them to attain finality. Once the surrender has been accepted and not been challenged, no relief can be granted to the petitioner by means of the instant petition.
35. It is an admitted fact that the allottee consortium formed an SPC to execute the project. After the SPC was accorded by respondent no.2, the SPC was the face of the consortium. The lead member of the consortium was majority shareholder of the SPC. Hence, the SPC was the sole entity, who was authorized to interact between respondent no.2 on behalf of the consortium.
CONCLUSIONS
36. Noticing the pleadings, this Court at the first blush noticed that the dispute, which has been raised by the petitioner apparently gave a flavour of dispute between the consortium members inter se and not so much between the consortium on one hand and the respondent authority on the other hand.
37. Thus, putting things together it clearly indicates that though the consortium members comprising of four companies are a separate entities, who had come together as a consortium to develop the land allotted to the consortium. As far as the authority is concerned, the consortium/SPC is a collective entity, who represents all the consortium members. As far as respondent no.2, YEIDA is concerned, it treats the consortium as an independent entity and the consortium members while forming the consortium/SPC have themselves unanimously decided to make M/s Sunworld Infrastructure Ltd. as a lead member of the consortium. The respondent authority is not obliged to deal with the members of the consortium separately nor such situation was contemplated in the brochure issued by them.
38. Undisputedly, the petitioner, who was a minor shareholder in the consortium and in the SPC, had jointly applied with other companies for the allotment of land. The application was made by the consortium in which he was a member. The land was allotted jointly to those companies in the consortium and, thereafter, the SPC was created on behalf of the consortium, which amounts to stepping in the shoes of the consortium, thereafter, the SPC was accorded approval by respondent no.2. The SPC having been approved and in place of the consortium the respondent no.2 had executed a lease deed in favour of the SPC. Thereafter, any interaction between respondent no.2 and the allottee was through this SPC. In this case, the SPC in its own wisdom had taken a call for surrendering the plot, which was accepted in the 66th and 67th Board Meeting and, accordingly, the surrender of the plot was accepted and refund of the amount deposited by the consortium/SPC was communicated to the SPC. Undoubtedly, there was an inter se dispute between the members of the consortium in which the petitioners have already file petition before the NCLT, Allahabad. Any inter se dispute between the members of the consortium has to be decided in the appropriate forum. As far as, respondent no.2 is concerned, it is only the SPC, who they recognize. Any application made by any other party or even buyer, small shareholder of the consortium (petitioner) cannot be entertained or accepted.
39. Further, the petitioner herein is only a meagre shareholder of 15% of the SPC, M/s Sunworld City Pvt. Ltd. it had neither applied nor was allotted the plot in its individual capacity/entity. In absence of the same it is not possible for the YEIDA to accept the request made by the petitioner to allot the said land in its favour.
40. Moreover, the request of surrender of the plot made by the SPC has been approved in the 66th and 67th Board Meeting held on 21.12.2019 and 29.12.2020 and the same has not been challenged and has attained finality, hence, the prayer made in the instant writ petition is completely misconceived and cannot be accorded.
41. In view of the aforesaid facts and circumstances, we find no merit in the instant writ petition and the same is, accordingly, dismissed.
Order Date :- 02.09.2024 S.P.