Jharkhand High Court
Sardul Auto Works Pvt. Ltd vs The State Of Jharkhand on 12 July, 2018
Author: D.N.Patel
Bench: Amitav K. Gupta, D.N.Patel
IN THE HIGH COURT OF JHARKHAND AT RANCHI
L.P.A. No. 487 of 2012
Sardul Auto Works Pvt. Ltd, having its place of working at Road No.
12 Jawaharnagar P.O. Azadnagar, P.S. Mango, Jamshedpur, through
its Director, Harpol Singh, son of Sardul Singh residing at
Jawaharnagar, P.O.-Azadnagar, P.S. Mango, District Jamshedpur
... ... Appellant
Versus
1. The State of Jharkhand
2. The Secretary, Department of Industries, Nepal House, P.O. & P.S.,
Doranda, District Ranchi
3. The Adityapur Industrial Area Development Authority, Adityapur
through its Managing Director, Adityapur, P.O. & P.S. Adityapur, District
Seraikela-Kharsawan
4. The Managing Director, Adityapur Industrial Area Development
Authority, P.O. & P.S. Adityapur, Dist. Seraikela-Kharsawan
5. M/s Santhal Multicast Pvt. Ltd., 3rd Phase, Industrial Area,
Adityapur, Jamshedpur through its Managing Director having its Office at
3rd Phase, Industrial Area, Adityapur, P.O. +P.S. Adityapur, District
Jamshedpur
... ... Respondents
with
L.P.A. No. 43 of 2013
Sardul Auto Works Pvt. Ltd, having its place of working at Road No.
12 Jawaharnagar P.O. Azadnagar, P.S. Mango, Jamshedpur, through
its Director, Harpal Singh, son of Sardul Singh residing at
Jawaharnagar, P.O.-Azadnagar, P.S. Mango, District Jamshedpur
... ... Appellant
Versus
1. The State of Jharkhand
2. The Secretary, Department of Industries, Nepal House, P.O. & P.S.,
Doranda, District Ranchi
3. The Adityapur Industrial Area Development Authority, Adityapur
through its Managing Director, Adityapur, P.O. & P.S. Adityapur, District
Seraikela-Kharsawan
4. M/s Santhal Multicast Pvt. Ltd., 3rd Phase, Industrial Area,
Adityapur, Jamshedpur through its Managing Director having its Office at
-2-
3rd Phase, Industrial Area, Adityapur, P.O. +P.S. Adityapur, District
Jamshedpur
------
CORAM: HON'BLE THE ACTING CHIEF JUSTICE HON'BLE MR. JUSTICE AMITAV K. GUPTA
-----
For the Appellant: M/s Rajiv Ranjan, Sr. Advocate
Dhananjay Kr. Pathak, Sweta Rani,
Saket Upadhyay & Akash Deep, Advocates
For Respondent No.1 & 2 : M/s Chandra Prabha, S.C.IV &
Mr. Rohit, A.C. to S.C. IV
For Respondent No.3 & 4 : M/s V.P. Singh, Sr. Advocate
R.C.P. Sah & C.A. Bardhan, Advocates
For Respondent No.5 : M/s Ritu Kumar, Nagmani Tiwari &
Vikash Kumar, Advocates
For the State : Ms. Neelam Tiwary, A.C. to Sr. S.C.I
-----
th
24/Dated 12 July, 2018
Per D.N. Patel, A.C.J.
1. L.P.A. No. 487 of 2012 has been preferred by the Original Petitioner in W.P.(C) No.1145 of 2011 whereas, L.P.A. No. 43 of 2013 has been preferred by the original petitioner in W.P.(C) No. 1408 of 2011, being aggrieved and feeling dissatisfied by the judgments and orders passed by the learned Single Judge in the respective writ petitions, both dated 14th August, 2012.
2. Factual Matrix The land in question is narrated as Plot No. M-2,N.S.-I, Phase III, admeasuring 5 Acres, situated in Adityapur Industrial Area near the city of Jamshedpur.
The aforesaid area is being owned, managed and controlled by Adityapur Industrial Area Development Authority (Hereinafter to be referred to as 'the AIADA' for the sake of brevity).
The plotting of this area was done by the AIADA for allotment of the lands to the Industrial units, for manufacturing purposes. The aforesaid plot was initially allotted to M/s Baynee Engineering Ltd. in the year 1996. Thus, lessor- the AIADA allotted the plot in question to M/s Baynee Engineering Ltd.- lessee, upon payment of certain rent and charges annually.
-3- For any reason, whatsoever, M/s Baynee Engineering Ltd. became a defaulter and hence, allotment of the plot was cancelled by the AIADA and it was allotted afresh to this appellant upon payment of the charges fixed by the AIADA, which, in total, comes to Rs. 29,82,830/-. Necessarily or unnecessarily, it was demanded by the AIADA that the defaulted amount of earlier allottee (towards arrears of rent) of Rs.5,47,568/-, should be paid by the new allottee, viz. this appellant.
Thus, the allotment money of Rs. 29,82,830/- as well as defaulted amount towards arrears of rent of Rs. 5,47,568/- was deposited by this appellant before the lessor -the AIADA on 29th September, 2010. Upon deposition of the aforesaid amount and on being fully satisfied that all the formalities were completed by this appellant, lessor- the AIADA allotted the plot in favour of this appellant on 30th September, 2010.
Thus, new lessor and lessee are the AIADA and this appellant, respectively, on and from 30th September, 2010 onwards. It further appears that defaulter- M/s Baynee Engineering Ltd. had also created charge upon the property in question, which is the plot as stated herein above, as sizable amount of loan was taken from a Bank. The loan was not repaid by M/s Baynee Engineering Ltd. to the Bank and, therefore, creditor Bank filed an application before the Debt Recovery Tribunal No.I, Kolkata, which was numbered as Case No. O.A. No. 81 of 2002.
The Debt Recovery Tribunal Kolkata, in the aforesaid matter, auctioned the landed property, as stated hererinabove, on 7th April, 2005 and auction purchaser, viz. M/s Model Heavy Fabricators Pvt. Ltd. has purchased the aforesaid land of which the AIADA is the lessor, but, the AIADA was never joined as a party respondent in Case No.O.A. No.81 of 2002 before the Debt Recovery Tribunal No.I, Kolkata. This has given birth to several litigations.
The Debt Recovery Tribunal No.I, Kolkata ought to have joined lessor-the AIADA as a party respondent, but, that was not done and the plot was auctioned by Debt Recovery Tribunal in absence of lessor-the AIADA and the auction purchaser was M/s Model Heavy Fabricators Pvt. Ltd.
-4- M/s Model Heavy Fabricators Pvt. Ltd. had no intention to manufacture anything and therefore, on its own, this auction purchaser assigned the aforesaid plot to Respondent No.5 of L.P.A. No. 487 of 2012, viz. M/s Santhal Multicast Pvt. Ltd.(Hereinafter to be referred to as "Respondent No.5"), on 2nd January, 2006.
Thus, Debt Recovery Tribunal No.I, Kolkata has passed an order of auction without joining the lessor -the AIADA as party respondent. This is mistake number one and mistake number two is that auction purchaser has assigned the plot to Respondent No.5 without permission of the lessor-the AIADA.
As stated hereinabove, lessor- the AIADA had already cancelled the earlier allotment of the plot in question, which was in favour of M/s Baynee Engineering Ltd. and there was re-allotment of plot in favour of this appellant. Now, prima facie, there was no hindrance for the appellant to start manufacturing process in the plot allotted by the AIADA, but, it was Respondent No. 5, who created the difficulty.
Against the order of cancellation of the allotment by the lessor- the AIADA of the industrial land to M/s Banyee Engineering Ltd., present assignee (Respondent No.5) of auction purchaser-M/s Model Heavy Fabricators Pvt. Ltd.approached the Secretary, Department of Industries, State of Jharkhand.
Secretary, Department of Industries, State of Jharkhand dismissed the appeal (Appeal No. 19 of 2010) preferred by Respondent No.5, vide order dated 7th February, 2011, mainly on the ground that Respondent No.5 has no locus standi because it is an assignee of the auction purchaser, i.e. M/s Model Heavy Fabricators Pvt. Ltd. and also on the ground that if at all there is any aggrieved party, it is M/s Baynee Engineering Ltd. and none else. Also there was another ground for dismissing the appeal preferred by Respondent No.5 and that was limitation.
It appears that some persons are over cautious. They have a tendency to look at the serious side of the matter, which is never in existence. This appellant was of such type of personality. Unnecessarily, this appellant preferred an application (Intervention application) before the Secretary, Department of Industries, State of Jharkhand in the appeal -5- preferred by Respondent No. 5. It is from this stage that the difficulty started for this appellant.
Secretary, Department of Industries, State of Jharkhand, ordered for reconsideration of the allotment of the land to this appellant. In fact, it was nobody's case that the allotment of the land in favour of this appellant is illegal.
Secretary, Department of Industries, State of Jharkhand, has made certain observations and directed lessor- the AIADA to reconsider the allotment of the land in favour of this appellant because Respondent No.5 (who was appellant before the Secretary, Department of Industries, State of Jharkhand) had offered Rs. 50,00,000/-(Rupees Fifty thousand only) to the AIADA, whereas this appellant- Sardul Auto Works Pvt. Ltd was ordered to pay the AIADA Rs.29,82,832/- +Rs. 5,47,568/-, which was already paid by this appellant.
Secretary, Department of Industries, State of Jharkhand, passed an order on 7th February, 2011, in which there was some observation prejudicial to the interest of the appellant and therefore, writ petition was preferred by this appellant being W.P.(C) No. 1145 of 2011, which was dismissed by the learned Single Judge vide judgment and order dated 14th August, 2012 and hence, original petitioner has preferred the letters Patent Appeal.
Similarly, being aggrieved and feeling dissatisfied by order dated 7th February, 2011 of the Secretary, Department of Industries, State of Jharkhand, Respondent No.5 filed a writ petition being W.P.(C) No.1408 of 2011, which was also dismissed by the learned Single Judge vide order dated 14th August, 2012 with a direction to the AIADA to consider allotment of the land in accordance with law. Against this order, Respondent No. 5 has not filed any Letters Patent Appeal because they have nothing much to lose.
In W.P.(C) No. 1408 of 2011, which was preferred by Respondent No. 5 and which was also disposed of by the learned Single Judge vide judgment and order dated 14th August, 2012, this appellant was a party respondent and hence this appellant has also preferred another Letters Patent Appeal, being L.P.A. No. 43 of 2013 challenging the order passed by the learned Single Judge vide judgment dated 14th August, 2012.
-6-3. Arguments canvassed by the counsel for the appellant Counsel appearing for the appellant submitted that this appellant is a genuine applicant before the AIADA for allotment of the plots, as stated hereinabove, for expansion of its manufacturing activities. This appellant already had one plot upon which industrial activities were going on for some years and for expansion of industrial activities, an application was preferred by the appellant before the AIADA to acquire another plot. The AIADA allotted the plot in question upon payment of an amount at Rs. 29,82,830/- + Rs.5,47,568/- to the appellant. This amount was paid on 29th September, 2010 and the plot in question was allotted to this appellant on 30th September, 2010.
Thus, the AIADA is a lessor and this appellant is a lessee of the plot in question. This allotment was made for 30 years, by way of lease, upon certain conditions.
It is submitted by the counsel for the appellant that there is no default made by the appellant, whatsoever. It is submitted by the counsel for the appellant that it is known to everybody that the AIADA is managing the allotment of the plots and if there is any defaulter, viz. if anyone is not paying the legally payable dues to the AIADA, it is cancelling the allotment. This phenomenon is not unknown in commercial world. Cancellation of allotment is a regular and routine phenomenon in cases of default. Earlier, this plot was allotted to M/s Baynee Engineering Ltd. on 14th September, 1996. Thereafter, M/s Baynee Engineering Ltd. became a defaulter and therefore, said allotment was cancelled and the very same plot was allotted to this appellant, as stated herein above, on 30th September, 2010. It is submitted by counsel for the appellant that M/s Baynee Engineering Ltd. was not only a defaulter of the AIADA, but, it was also a defaulter of Bank/ Banks and therefore, one of the Banks filed Case No. O.A. No.81 of 2002 before the Debt Recovery Tribunal No.I, Kolkata. In that proceeding, lessor- the AIADA was not joined as a party respondent and hurriedly, an auction was held on 7th April, 2005 and M/s Model Heavy Fabricators Pvt. Ltd. purchased the plot in question without there being any consent of the lessor viz. the AIADA.
M/s Model Heavy Fabricators Pvt. Ltd. had no intention to carry out -7- any manufacturing activity at all on the plot in question and therefore, M/s Model Heavy Fabricators Pvt. Ltd. has assigned the plot in question to Respondent No.5 on 2nd January, 2006.
It is submitted by the counsel for the appellant that this appellant is a lessee of the AIADA and in fact, Debt Recovery Tribunal No.I at Kolkata could not have given the plot to M/s Model Heavy Fabricators Pvt. Ltd. without there being consent from the lessor-the AIADA and without hearing the lessor. Similarly, M/s Model Heavy Fabricators Pvt. Ltd. cannot assign the plot to Respondent No. 5 without permission of lessor -the AIADA. Thus, it is submitted by the counsel for the appellant that there are errors and overlapping errors.
It is submitted by the counsel appearing for the appellant that Respondent No.5, though, was never allotted the plot in question by lessor- the AIADA, challenged the action of this lessor-the AIADA of cancellation of allotment of the plot of the defaulter, viz. M/s Baynee Engineering Ltd. before the Secretary, Department of Industries, State of Jharkhand, in Appeal No.19/2010, mainly on the ground that for the plot in question, it (Respondent No.5) is ready to pay Rs.50,00,000/- (Rupees Fifty lacs), whereas this appellant (in this Letters Patent Appeal) was given the plot by the AIADA at a loss upon payment of Rs. 29,82,830/-. The Secretary, Department of Industries, State of Jharkhand dismissed the appeal preferred by Respondent No.5 vide order dated 7th February, 2011 (annexure 10 to the memo of L.P.A. No. 487 of 2012).
It is submitted by the counsel appearing for the appellant that this over cautious appellant preferred an application (Intervention Application) before the Secretary, Department of Industries, State of Jharkhand in the Appeal, preferred by Respondent No.5. This was not necessary at all, because this appellant was allotted the plot in question by the AIADA on 30th September, 2010. Secretary, Department of Industries, State of Jharkhand has added one more sentence in the order at Annexure 10 directing the AIADA to consider re-allotment of the plot in question looking to the price offered by Respondent No.5.
It is submitted by counsel for the appellant that this observation has been made by the said Secretary without power, jurisdiction and authority.
-8- It is submitted by the counsel for the appellant that the plot in question is already allotted to this appellant on 30th September, 2010 as per the price fixed by the AIADA. Price fixed by the AIADA was common for all. No special price or concessional price was fixed by the AIADA for this appellant. After allotment was made by the AIADA to the appellant, even if there is any higher offer made by Respondent No.5, there cannot be any direction to the AIADA to re-allot the plot in question, otherwise, there will be no finality of any lease agreement because anybody can come and make a higher offer. This aspect of the matter has not been properly appreciated by the Secretary, Department of Industries, State of Jharkhand while deciding Appeal No. 19/2010 vide order dated 7th February, 2011 and by the learned Single Judge while deciding W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 vide two different judgment and order, both dated 14th August, 2012.
It is submitted by the counsel appearing for the appellant that neither the Secretary, Department of Industries, State of Jharkhand nor the learned Single Judge pointed out any illegality in the allotment of the plot in question to this appellant by the AIADA. At the relevant time the price prevailing for the neighbouring plot was exactly matching with the price paid to the AIADA by this appellant looking to the affidavit filed by Respondent No.s 3 and 4, dated 5th March,2017, especially paragraph No. 6 onwards to be read with Annexures B and B/1 It is submitted by the counsel appearing for the appellant that the payment made by this Appellant to the AIADA was at the rate prevailing in Phase III of the Adityapur Industrial Area and was never a concessional one. Never any concession was given by the AIADA to this appellant. This aspect of the matter has been lost sight of by both the Secretary, Department of Industries, State of Jharkhand and the learned Single Judge and hence, order dated 7th February, 2011, passed by the Secretary, Department of Industries, State of Jharkhand as well as the orders, dated 14th August, 2012, passed by the learned Single Judge in W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 deserve to be quashed and set aside so far as they affect the present appellant. It is also submitted by the counsel for the appellant that M/s Model Heavy Fabricators Pvt. Ltd. could not have been given the plot by the Debt -9- Recovery Tribunal No.I, Kolkata in Case No. O.A. No.81 of 2002 without hearing lessor- the AIADA. This aspect of the matter was also not properly appreciated by the learned Secretary, Department of Industries, State of Jharkhand while deciding Appeal No. 19/2010 vide order dated 7th February, 2011 and by the learned Single Judge while deciding W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 vide two different judgment and order, both dated 14th August, 2012.
It is submitted by the counsel for the appellant that M/s Model Heavy Fabricators Pvt. Ltd. had no intention at all to carry out any industrial activity in the plot in question at Adityapur Industrial Area. Nobody can keep an industrial plot without carrying on industrial activities on the same. M/s Model Heavy Fabricators Pvt. Ltd. had unilaterally assigned the industrial plot to Respondent No. 5 on its own on 2nd January, 2006. It is further submitted by the counsel for the appellant that M/s Model Heavy Fabricators Pvt. Ltd. can neither be allotted the industrial plot without permission of lessor-the AIADA nor Respondent No.5 can have any interest in the aforesaid industrial plot, without there being any allotment by lessor-the AIADA. This aspect of the matter has also been lost sight of by the Secretary, Department of Industries, State of Jharkhand as well as the learned Single Judge and hence also order dated 7th February, 2011, passed by the Secretary, Department of Industries, State of Jharkhand as well as the orders, dated 14th August, 2012, passed by the learned Single Judge in W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 deserve to be quashed and set aside, so far as they affect the present appellant.
It is submitted by the counsel for the appellant that though this appellant has already paid a sizable amount of Rs. 29,82,830/- + Rs.5,47,568/- as on 29th September, 2010, it is not in possession of the plot in question and therefore, immediately the possession of the plot should be given by Respondent No. 5 to this appellant.
4. Arguments canvassed by the Respondent No.s 3 and 4 :
It is submitted by counsel for Respondent No.s 3 and 4 that initially the plot in question was allotted to M/s Baynee Engineering Ltd. on 14th September, 1996 by way of lease. Condition of lease was not observed by the lessee and therefore, it became a defaulter. Sizable amount of -10- arrears of rent was not paid and industrial activities also could not be carried out.
It is submitted by the counsel for Respondent No.s 3 and 4 that allotment of land in favour of M/s Baynee Engineering Ltd. was cancelled on 21st October, 2009 and after cancellation, another applicant, who is the present appellant, was allotted the plot in question on 30th September, 2010 upon payment of Rs. 29,82,830/- + Rs.5,47,568/-. It is further submitted by the counsel for the Respondent No.3 and 4 that this appellant was already engaged in industrial activities in another plot of Adityapur Industrial Area and it wanted another plot for expansion of its industrial activities. Such type of applicants can always be allotted plot by the AIADA and thus, no illegality was committed by the AIADA in allotting the land in question to the present appellant It is further submitted by the counsel for Respondent No. 3 and 4 that the price paid by the appellant for the land in question was never a concessional one. No discount was ever given by the AIADA to the present appellant and this fact is stated on oath by Respondent No.s 3 and 4 in counter affidavit dated 5th March, 2017 and it has been stated therein, from para 6 onwards that for the plots situated in Phase III of the Adityapur Industrial Area the prevailing prices are mentioned in Annexure 3 series to the said affidavit and exactly at the rate of prevailing prices in Phase III, payment was made by this appellant to the AIADA. This aspect of the matter was not appreciated by the learned Secretary, Department of Industries, State of Jharkhand, while deciding Appeal No. 19/2010 vide order dated 7th February, 2011 and by the learned Single Judge while deciding W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 vide two different judgment and order, both dated 14th August, 2012.
Respondent 3 and 4 have no objection if the possession of the plot is given to the present appellant because the amount demanded by the lessor has already been paid by this appellant on 29th September, 2010 and the plot is allotted in favour of this appellant on 30th September, 2010, as the earlier allotment, which was in favour of M/s Baynee Engineering Ltd. was already cancelled by the AIADA on 21st October, 2009. It is submitted by the counsel for Respondent No. 3 and 4 that Debt -11- Recovery Tribunal No.I, Kolkata in Case No. O.A.No. 81 of 2002 should not have auctioned the aforesaid plot, without hearing the lessor of the property, in favour of one M/s Model Heavy Fabricators Pvt. Ltd. on 7th April, 2005. Had this lessor been joined as a party respondent, it would have been pointed out that M/s Model Heavy Fabricators Pvt. Ltd. cannot be allotted any plot because it has no intention to do any industrial activity. Neither any project was placed before the Committee constituted by the AIADA nor there was any clearance of project by the AIADA of M/s Model Heavy Fabricators Pvt. Ltd. There are varieties of reasons for which M/s Model Heavy Fabricators Pvt. Ltd. cannot be allotted the plot in question, more so when this auction purchaser has assigned the plot on its own, without permission of lessor-the AIADA, to Respondent No.5 on 2nd January, 2006.
Counsel appearing for Respondent No. 3 and 4 submits that even if the assignee of the auction purchaser is ready to pay higher price, the plot cannot be allotted, because what is required and what is most important is not the price, which is being paid, but, the intention to carry out industrial activity. This aspect of the matter has been lost sight of by the learned Secretary, Department of Industries, State of Jharkhand while deciding Appeal No. 19/2010 vide order dated 7th February, 2011 and by the learned Single Judge while deciding W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 vide two different judgment and order, both dated 14th August, 2012. Price is not the sine qua non for allotment of industrial plots. Everything cannot be purchased by money only, otherwise all trader type entities will come for allotment of industrial plots at a slightly higher amount and on their own they will assign the plot after receiving more money from the person like Respondent No.5.
This type of trading of industrial plot is prohibited. This aspect of the matter was not properly appreciated by the learned Secretary, Department of Industries, State of Jharkhand while deciding Appeal No. 19/2010 vide order dated 7th February, 2011 and by the learned Single Judge while deciding W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 vide two different judgment and order, both dated 14th August, 2012.
-12- It is submitted by the counsel for Respondent No. 3 and 4 that Respondent No. 5 has no locus standi, at all, to challenge order dated 21st October, 2009 of the AIADA (vide which allotment of M/s Baynee Engineer Ltd. was cancelled) before the Secretary, Department of Industries, State of Jharkhand and thus, the learned Secretary rightly dismissed the appeal filed by Respondent No.5 against order, dated 21st October, 2009, of the AIADA. Thus, the order of cancellation of the allotment of the plot in question dated 21st October, 2009 was upheld by the Secretary, Department of Industries, State of Jharkhand. Unnecessarily, this appellant had preferred the application in the appeal preferred by Respondent No.5 before the Secretary, Department of Industries, State of Jharkhand, which has given birth to the said writ petitions and these two Letters Patent Appeals. Allotment of the plot in question in favour of the appellant was never under challenge and therefore, the Secretary, Department of Industries, State of Jharkhand has no power, jurisdiction and authority to direct the AIADA to reconsider the allotment of the plot in question. This aspect of the matter has not been properly appreciated by the learned Single Judge while deciding W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 vide two different judgment and order, both dated 14th August, 2012.
Learned counsel for the Respondent No.3 and 4 further submitted that the observation of Secretary, Department of Industries, State of Jharkhand, in his Order dated 7th February, 2011 for reconsideration of the allotment of the plot in question was based upon just an offer made by Respondent No. 5 of Rs. 50,00,000/- for the said plot. Genuineness of this offer ought to have been verified by the Secretary, Department of Industries, State of Jharkhand by passing an order directing Respondent No.5 for deposition of Rs.50,00,000/-.
It is submitted by the counsel appearing for Respondent No. 3 and 4 that desire to pay a higher price cannot be a reason for cancellation of allotment of the land. What matters is the locus standi of Respondent No.5 to file an appeal before the Secretary, Department of Industries, State of Jharkhand, limitation as well as the intention to carry out industrial activity. There was a lack of intention on the part of Model Heavy --
-13-Fabricators Pvt. Ltd. to start industrial activities on the plot in question, which assigned the plot to Respondent No.5. If M/s Model Heavy Fabricators Pvt. Ltd. had no intention to start Industrial Activity, the Debt Recovery Tribunal No.I, Kolkata should not have allowed M/s Model Heavy Fabricators Pvt. Ltd. to purchase the plot at any cost, whatsoever. Thus, M/s Model Heavy Fabricators Pvt. Ltd. could not have purchased the plot even at any cost and hence its assignee Respondent No.5 cannot get any plot, whatsoever. This aspect of the matter has been lost sight of by the Secretary, Department of Industries, State of Jharkhand while passing order dated 7th February, 2011 (Annexure 10 to the memo of this Letters Patent Appeal) and this aspect has not been properly appreciated by the learned Single Judge also while deciding the writ petitions and hence, order dated 7th February, 2011, passed by the Secretary, Department of Industries, State of Jharkhand as well as the orders, dated 14th August, 2012, passed by the learned Single Judge in W.P.(C) No. 1145 of 2011 as well as in W.P.(C) No. 1408 of 2011 deserve to be quashed and set aside so far as they affect the present appellant.
It is submitted by the counsel appearing for Respondent No.3 and 4 that no allottee of the plot in question can assign the plot, without consent of lessor-the AIADA, on its own to a third party. Lessee cannot assign the plot to a sub lessee without prior permission of the lessor as per the covenant incorporated in the lease deed.
Thus, as submitted by the counsel appearing for Respondent No.3 and 4, sub lease was never permitted. There ought to have been a tripartite agreement, if any lessee wants to assign the industrial plot to a sub-lessee. In the facts of the present case, M/s Model Heavy Fabricators Pvt. Ltd. cannot assign the plot to anyone, much less to Respondent No.5, without there being a tripartite agreement which would include lessor-the AIADA.
Thus, it is submitted by counsel appearing for Respondent No.3 and 4 that once Secretary, Department of Industries, State of Jharkhand has not interfered with the order of cancellation of the allotment of the plot by the AIADA dated 21st October, 2009, there was no need for the Secretary, Department of Industries, State of Jharkhand, to -
-14-further observe in the order dated 7th February, 2011 (Annexure 10 to the L.P.A. No. 487 of 2012) that the AIADA can reallot the plot. This observation was uncalled for and was unwarranted because the allotment of the plot in favour of this appellant, dated 30th September, 2010, was never under challenge before the Secretary, Department of Industries, State of Jharkhand, and hence, order dated 7th February, 2011, passed by the Secretary, Department of Industries, State of Jharkhand as well as the orders, dated 14th August, 2012, passed by the learned Single Judge in W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 deserve to be quashed and set aside, so far as observations regarding reconsideration by the AIADA for re-allotment of the plot in question is concerned.
5. Arguments canvassed by Respondent No.5.
Counsel appearing for Respondent No.5 submits that Respondent No.5 was an assignee of the industrial plot in question by M/s Model Heavy Fabricators Pvt. Ltd. on 2nd January, 2006. M/s Model Heavy Fabricators Pvt. Ltd. was an auction purchaser of the industrial plot before the Debt Recovery Tribunal No.I, Kolkata in Case No. O.A.No.81 of 2002. It is submitted by counsel for Respondent No. 5 that M/s Model Heavy Fabricators Pvt. Ltd. had purchased the industrial plot on 7th April, 2005 in an auction carried out by the Debt Recovery Tribunal I, Kolkata and therefore, M/s Model Heavy Fabricators Pvt. Ltd. has all right, title and interest in the industrial plot, which is now vested in Respondent No.5 and therefore, Respondent No. 5 has all power, jurisdiction and authority to challenge the order passed by the AIADA dated 21st October, 2009 cancelling the allotment of Industrial Plot in favour of M/s Baynee Engineering Ltd. This aspect of the matter was not properly appreciated by the learned Secretary, Department of Industries, State of Jharkhand while deciding Appeal No. 19/2010 vide order dated 7th February, 2011. It is further submitted by Respondent No. 5 that in fact, Respondent No. 5 has offered much higher amount to lessor-the AIADA than what has been offered by this appellant. This appellant has paid approximately Rs.30 lacs for the plot in question, whereas Respondent No. 5 has offered Rs. 50 lacs.
-15- It is further submitted by counsel appearing for Respondent No. 5 that when Respondent No. 5 is offering sizable amount then it ought to be appreciated by lessor- the AIADA to reallot the plot in question. This was properly appreciated by the Secretary, Department of Industries, Government of Jharkhand, in his order dated 7th February and therefore, order of allotment in favour of the present appellant by the AIADA should be cancelled and there should be a re-auction of the property or there should be re-allotment of the industrial plot. This aspect of the matter has been properly appreciated by the learned Single Judge while deciding W.P.(C) No. 1408 of 2011 and W.P.(C) No. 1145 of 2011, vide separate judgments and orders, both dated 14th August, 2012 and hence, these Letters Patent Appeals may not be entertained by this Court. It is submitted by counsel appearing for Respondent No.5 that looking to the affidavit filed by Respondent No.s 1 and 2 dated 14th November, 2017, especially paragraph 8 onwards thereof, it appears that there are several plots available for allotment because the AIADA has got 358.06 acres of vacant land, which is waiting for its allotment and therefore, let a suitable direction be given to AIADA for allotment of any other industrial plot to Respondent No. 5 upon payment of the legally payable amount.
6. Arguments canvassed by counsel for Respondent No.s 1 and 2. Counsel appearing for Respondent No.s 1 and 2 has adopted the argument canvassed by Respondent No. 3 and 4 so far it concerns the availability of land and a fresh allotment of any other vacant land in accordance with law, rules and regulations, especially Adityapur Industrial Area Development Authority Regulations, 2016. Keeping in mind this legal position, a plot can be allotted to any applicant who is eligible for the allotment, which includes Respondent No. 5. REASONS:
7. Having heard counsels appearing for both sides and looking to the facts and circumstances of the case, we, hereby, quash and set aside the order passed by the learned Single Judge in W.P.(C) No. 1145 of 2011 and the order passed in W.P.(S) No. 1408 of 2011, both dated 14th August, 2012 as well as order dated 7th February, 2011, passed by the -16- Secretary, Department of Industries, State of Jharkhand in Appeal No. 19 of 2010 for the following facts and reasons:
(I) The plot in question is narrated as Plot No. M-2, N.S.-I, Phase III, admeasuring 5 Acres, situated in Adityapur Industrial Area near the city of Jamshedpur (II) The plot in question is an industrial plot, which is owned, managed and controlled by the AIADA- the only body which can allot plots of land on lease to the applicants upon payment of requisite amount and upon fulfilment of other conditions, like approval of the project report etc. by the AIADA.
(III) It appears that payment of higher amount is not the sine qua non for allotment of plots by the AIADA. What is more important is the intention of the applicant to carry out industrial activities. (IV) The plot in question was initially allotted to M/s Baynee Engineering Ltd. on 14th September, 1996. This plot was assigned to M/s Baynee Engineering Ltd. on lease for 30 years, upon fulfilment of several conditions like payment of rent etc. (V) M/s Banyee Engineering Ltd. became a defaulter of sizable amount and hence, lessor- the AIADA cancelled the allotment of aforesaid industrial plot vide order dated 21st October, 2009, which was in favour of M/s Baynee Engineering Ltd.
(VI) Thus, aforesaid industrial plot was free to be assigned to any other applicant by lessor-the AIADA.
(VII) There were several applications pending before the lessor.
Periodically, plots were being allotted by the AIADA after verification and approval of certain projects presented by the applicants and upon payment of certain amount and upon fulfilment of certain conditions, lease agreements were entered into. One of such applicants was this appellant, at the relevant time, whose project was approved by the Committee, constituted by the AIADA, and later on, on payment of Rs. 29,82,830/-, the aforesaid plot was allotted to this appellant on 30th September, 2010 upon further payment of Rs. 5,47,568/-, which was the arrears of rent of defaulter M/s Baynee Engineering Ltd. We are not analysing the payment of defaulted rent, of the earlier allottee by the present appellant, but, the fact remains that not only the legally payable amount, viz. Rs.29,82,830/-
-17-was paid, but, this appellant had also paid the defaulted amount of arrears of rent of the earlier allottee i.e. M/s Baynee Engineering Ltd. though this appellant had nothing to do with the same. (VIII) Thus, the plot in question of which the allotment was cancelled on 21st October, 2009 for M/s Baynee Engineering Ltd. is now allotted to this appellant on 30th September, 2010.
(IX) M/s Baynee Engineering Ltd. was also a defaulter of several financial institutions and one such Bank, who was a creditor, filed Case No. O.A. No.81 of 2002 before the Debt Recovery Tribunal No.I at Kolkata. This was an application for recovery of loan from M/s Baynee Engineering Ltd. before the Debt Recovery Tribunal. The AIADA was never joined as a party and hence, the Debt Recovery Tribunal No. I, Kolkata in Case No. O.A. No.81 of 2002 has passed an order of auction of the property, without hearing the lessor.
(X) M/s Model Heavy Fabricators Pvt. Ltd. is an auction purchaser of the property in question, which has taken place on 7th April, 2005. In fact, before the Debt Recovery Tribunal, Kolkata, lessor- the AIADA ought to have been heard. There were several reasons to hear the lessor of the industrial plot. The Debt Recovery Tribunal ought to have kept in mind that the method of auction involving normal plots cannot be implemented with respect to industrial plots. It ought to have been kept in mind by the Debt Recovery Tribunal No.1, Kolkata that whenever any industrial plot, assigned by some lessor, is to be auctioned then lessor must be heard so that auction purchaser's intention to carry out industrial activities at the plot in question can be verified. Sometimes, people purchase industrial plots through auction just as traders which is not permissible in the eye of law. Nobody is allowed "to trade" in industrial plots, viz. to purchase in auction industrial plots at certain higher price and then assign the plot to some other person. This is not permissible and therefore, lessor of industrial plots must be heard by the Debt Recovery Tribunal. Thus, M/s Model Heavy Fabricators Pvt. Ltd., who was an auction purchaser of the aforesaid industrial plot in the auction dated 7th April, 2005, had no intention to carry out any industrial activity and therefore, M/s Model Heavy Fabricators Pvt. Ltd. assigned the aforesaid industrial plot, on its own, unilaterally, without permission of the lessor, to Respondent No.5 as on -18- 2nd January, 2006. This is a patent illegality. Industrial plots cannot be transferred by anyone or everyone, neither by the lessee nor by the auction purchaser. This aspect of the matter has been lost sight of by the Secretary, Department of Industries, State of Jharkhand as well as by the learned Single Judge and hence also order dated 7th February, 2011, passed by the Secretary, Department of Industries, State of Jharkhand as well as the orders, both dated 14th August, 2012, passed by the learned Single Judge in W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 deserve to be quashed and set aside so far as they affect the allotment of the plot in question in favour of this appellant on 30th September, 2010 by the lessor.
Debt Recovery Tribunal No. I, Kolkata, while passing an order in Case No. O.A. No. 81 of 2002 had committed an error because it was not appreciated by the Tribunal that neither the bank was a lessor nor the Debt Recovery Tribunal can step into the shoes of a lessor. Original lessor - the AIADA ought to have been joined as a party respondent. The Debt Recovery Tribunal No.I, Kolkata can neither allow M/s Model Heavy Fabricators Pvt. Ltd. to purchase the property nor create any lease in favour of M/s Model Heavy Fabricators Pvt. Ltd. because the Debt Recovery Tribunal was neither a lessor nor it can step into the shoes of the lessor. The applicant Bank, which preferred Case No. O.A.No.81 of 2002, was also not the lessor and therefore, lessor of the plot in question ought to have been joined as a party respondent so that several other facts about auction purchaser can be verified by the lessor or even an objection can be raised by the lessor that the industrial plot has already been allotted to somebody else or is likely to be allotted to somebody else.
It appears from the facts of the case that M/s Model Heavy Fabricators Pvt. Ltd. had no right to be an auction purchaser in absence of the lessor and therefore, similarly, it had no right to assign the plot in question to Respondent No.5 on 2nd January, 2006, which is another overlapping error or another overlapping illegality. (XI) Respondent No.5 has no power, jurisdiction and authority to challenge the order of cancellation of allotment of the plot by the AIADA dated 21st October, 2009, which was initially made in favour of M/s Baynee -19- Engineering Limited and that too after much delay in an appeal preferred before the Secretary, Department of Industries, State of Jharkhand being Appeal No. 19 of 2010. This Appeal No. 19 of 2010 was rightly dismissed by the Secretary, Department of Industries, State of Jharkhand vide order dated 7th February, 2011. Thus, order of cancellation of allotment passed by AIADA dated 21st October, 2009 has attained its finality. This order of the AIADA was upheld by order, dated 7th February, 2011 in Appeal No. 19 of 2010. Unnecessarily, this appellant, being over cautious, had preferred an intervention application in Appeal No.19 of 2010 before the Secretary, Department of Industries, State of Jharkhand, who had made an observation in order dated 7th February, 2011 that the AIADA can rethink about allotment of the industrial plot because Respondent No.5, who is appellant in Appeal No. 19 of 2010, before the Secretary, Department of Industries, State of Jharkhand had offered Rs. 50,00,000/- for the said plot. The Secretary, Department of Industries, State of Jharkhand, could have checked the bonafide of Respondent No.5 by passing an order to deposit Rs. 50,00,000/-, so that "opus"kq fdae~ nfjnzk%" (Why one should be poor, in giving a promise) type of applicant's intention can be verified.
In view of the aforesaid Sanskrit philosophy, which applies very aptly to the casual assurance given by Respondent No. 5, the said respondent, who was the appellant in Appeal No. 19 of 2010, in all probability, has made a false promise to offer Rs.50,00,000/- for the land in question and the Secretary, Department of Industries, Government of Jharkhand, had made an observation in the order dated 7th February, 2011, while deciding the said appeal that there can be re-allotment of the plot in question. This is an apparent error committed by the Secretary, Department of Industries, Government of Jharkhand and hence, this observation, made in order dated 7th February, 2011 in appeal No. 19 of 2010, is hereby, quashed and set aside. Rest part of the order is maintained as it is.
This aspect of the matter has also been lost sight of by the learned Single Judge while deciding W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 vide orders, both dated 14th August, 2012. We, therefore, quash and set aside the orders, dated 14th August, 2012, passed by the -20- learned Single Judge in W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 so far as they affect the allotment of the industrial plot in favour of this appellant.
(XII) It further appears from the arguments canvassed by both sides that unnecessarily Respondent No.5 has retained the possession.
Thus, it appears that Respondent No. 5, who is an illegal assignee of the plot in question by M/s Model Heavy Fabricators Pvt. Ltd., is in possession of the industrial plot on and from 2nd January, 2006, hence, Respondent No.5 is bound to make payment of reasonable rent to the AIADA till the AIADA finally decides the amount of rent to be paid by Respondent No.5.
It ought to be kept in mind that those, who are illegally retaining industrial plots are not only causing loss to lessor-the AIADA, but, this act of illegal retention has caused sizable loss to the State of Jharkhand. Not only there is loss of rent to the AIADA, but, also of an industrial activity on that plot which otherwise could have generated income for the State in the form of taxes. Thus, there is a sizable loss to the AIADA as well as to the State of Jharkhand because of illegal retention of industrial plots by Respondent No.5 from 2nd January, 2006, without any industrial activity, and that too just as an assignee of M/s Model Heavy Fabricators Pvt. Ltd. In fact, M/s Model Heavy Fabricators Pvt. Ltd. had no power, jurisdiction and authority to assign such a huge industrial plot in favour of Respondent No.5, without prior permission of the lessor-AIADA. (XIII) When we put a question to Respondent No.5 as to whether any industrial activity is carried out by Respondent No.5 on the said plot, there is a stoic silence from the counsel for Respondent No.5. Industrial Plots cannot be sold and purchased like a free hold land by people like traders. In fact, M/s Model Heavy Fabricators Pvt. Ltd. cannot be the auction purchaser of the plot in question because it is an industrial plot and over and above money, several other things are attached to the allotment of the plot. There was no intention at all of M/s Model Heavy Fabricators Pvt. Ltd. to initiate industrial activities in the industrial plot in question situated at Adityapur Industrial Area near Jamshedpur and therefore, like a trader, this M/s Model Heavy Fabricators Pvt. Ltd. has assigned the plot to -21- Respondent No.5 as on 2nd January, 2006. Thus, in our view, purchasers of plots from illegal owners must suffer. Such a huge industrial plot must have been purchased by Respondent No. 5 deliberately and this must be a pre-planned and well designed action on its part. In fact, no innocence can be attached to either M/s Model Heavy Fabricators Pvt. Ltd. or to Respondent No.5. Unnecessarily the plot has been retained by Respondent No.5 with no industrial activity from 2nd January, 2006.
We, therefore, direct that Rs. 15,00,000/- shall be deposited by Respondent No.5 within twelve weeks from today, subject to the final rent which will be calculated and fixed as rent (including penalty) by the AIADA after giving adequate opportunity of being heard to Respondent No.5. If higher amount is fixed by the AIADA to be paid by Respondent No.5, balance amount will also be deposited by Respondent No. 5. This order against Respondent No.5 to deposit the amount is passed, so as to curb, such type of activities by auction purchasers or by such type of persons who are engaged in the business of trading in industrial plots in Adityapur Industrial Area.
(XIV) It is submitted by the counsel for Respondent No.5 that stay was given by this High Court and hence, said respondent is in possession.
This argument is of no help to Respondent No.5 because, upon arguments canvassed by the counsel for Respondent No.5, an order of stay must have been passed. Appellant has never assisted in getting the stay in favour of Respondent No.5. The AIADA never assisted in getting the stay in favour of Respondent No.5. The fact remains that Respondent No. 5 remained in possession from 2nd January, 2006 of the industrial plot in question without there being any industrial activity. Possession of industrial plot, is a costly affair, without industrial activity. (XV) We, therefore, quash and set aside the judgments and orders, dated 14th August, 2012, passed by the learned Single Judge in W.P.(C) No. 1145 of 2011 as well as W.P.(C) No. 1408 of 2011 and order dated 7th February, 2011, passed by the Secretary, Department of Industries, State of Jharkhand so far as they affects the allotment of industrial plot in favour of this appellant and we, hereby, direct Respondent No.5 to immediately hand over the possession to this appellant. We also direct the AIADA to -22- assist for peaceful handover of the industrial plot in question to the legal allottee or lessee or this appellant.
We also direct the State of Jharkhand to assist this appellant in getting possession and if there is any hindrance caused by Respondent No.5, immediately the matter may be mentioned before this Court even after disposal of these Letters Patent Appeals, within a period of 10 days. (XVI) Looking to the policy decision taken by Respondent 1 and 2, which is mentioned in the affidavit filed by Respondent No.s 1 and 2, dated 10th November, 2017, especially paragraph no. 8 thereof, we, hereby, permit the Respondent No. 5 to prefer an application for industrial plot, only after the rent is paid, as stated hereinabove and we direct that if any application is preferred by Respondent No. 5 for allotment of another industrial plot at Adityapur industrial Area, the same will be decided by Respondent No.s 1, 2, 3 and 4 in accordance with rules, regulations, governmental orders, policy and the regulations of Adityapur Industrial Area Development Authority Regulations, 2016.
8. These Letters Patent Appeals are allowed with the above directions.
(D.N.Patel, A.C.J.) (Amitav K. Gupta, J.) s.m.