Calcutta High Court (Appellete Side)
Binod Kumar Agarwal And Others vs The State Of West Bengal And Others on 10 November, 2022
M.L.-06
Ct No.09
10.11.2022
(Assigned)
WPA No. 2615 of 2021
IA No: CAN 1 of 2021
Binod Kumar Agarwal and others
Vs.
The State of West Bengal and others
Mr. Sabyasachi Chatterjee,
Ms. Dona Ghosh,
Mr. Sandipan Das,
Mr. Ankur Sharma,
Mr. Bodrul Karim
.... for the petitioners
Mr. Chayan Gupta,
Mr. Sandip Dasgupta,
Mr. Saaqib Siddiqui,
Mr. Aviroop Mitra
.... for the WBHIDCO
Mr. Arunava Ghosh,
Mr. Atish Dipankar Ray,
Mr. Asit De,
Ms. Sanjukta Ray
.... for the respondent nos.8 to 10
The writ petition was heard only on the point of maintainability. Hence, the merits of the matter are not entered into at this stage and all the findings below are prima facie for the purpose of deciding the question of maintainability. The respondents plead non-maintainability at the outset.
2Relief B) of the writ petition, it is contended, concerns a money claim and is not amenable to the writ jurisdiction.
Secondly, the petitioners are not parties to the development agreement on which they heavily rely, hence hit by privity.
The said agreement is not a statutory agreement; hence, no writ lies for its implementation.
Fourthly, all the private respondents are companies having privately elected Boards of Directors, having no connection with the Government of West Bengal.
That apart, the petitioners, it is contended, have failed to demonstrate that not handing over their flats within the alleged time given amounts to violation of fundamental rights, namely right to life under Article 21.
The respondents cite judgments, which have been discussed later on hereunder, and seek to distinguish the petitioners' citations. The petitioners, on the other hand, harp on the public law element allegedly involved in the present case to justify the invocation of the writ jurisdiction. It is submitted that mere availability 3 of alternative remedy is not a bar to the exercise of jurisdiction under Article 226 of the Constitution.
The first decision cited by the petitioners is Smt. Vrinda Gujarati & Ors. V. Bareilly Development Authority & Ors., reported at AIR 1997 All 107, in which a Division Bench of the Allahabad High Court had interfered in the case of delay occasioned by the authorities in registering applications for allotment of houses. However, there the judicial review had emanated from contracts which originated from statutes and rules. The inaction complained of was that of the Bareilly Development Authority. Although, in the present case, the HIDCO is also involved, the inaction complained of is primarily of the Respondent Nos. 8 and 9 which are not statutory bodies, nor are the agreements statutory contracts. Thus, the said judgment is not applicable in terms.
The next cited judgment of the petitioners is LIC of India & Anr. V. Consumer Education & Research Centre &Ors., reported at (1995) 5 SCC 482, where the Supreme Court contemplated interference in the writ jurisdiction in state action in the contractual field. Paying capacity for life insurance was broadly included within the right to life and public element was read into it. The said 4 principle, no doubt, holds true for the present case, though analogically.
The ratio laid down in W.B. Housing Board & Ors. v. Brijendra Prasad Gupta &Ors., reported at (1997) 6 SCC 207, however, pertains to land acquisition and involves the role of the Housing Board, which is a statutory authority. Hence, the ratio laid down therein is not applicable directly to the present case.
The next citation of the petitioners, being Urmila Roy & Ors. v. Bengal Peerless Housing Development Company Limited &Ors. [(2009) 5 SCC 242] relates to the W.B. Housing Board Act, 1972 and is not apt in the facts of the present case, which is not under the said or any similar statute. The ratio laid down in the next judgment, Whirlpool Corporation v. Registrar of Trade Marks, Mumbai &Ors. [(1998) 8 SCC 1] is broadly applicable in the sense that the existence of alternative remedy is not an absolute bar in several circumstances.
Magadh Sugar & Energy Ltd. V. State of Bihar &Ors., reported at 2021 SCC OnLine 801, encapsulates the principles of law governing interference in the writ jurisdiction. Exceptions to the rule of alternate remedy have been discussed 5 there and it has also been reiterated that an alternate remedy by itself does not divest the High Court of its powers under Article 226 of the Constitution. The discussions below would go on to clarify that the broad principles laid down therein, for interference in judicial review under Article 226, are met in the instant case. The scope and gamut of the present writ petition is not restricted to private contractual relief but relates to a public purpose as well.
Keeping in mind the above propositions, the facts of this case are as follows:
The cause of action of the present writ petition is comprised of a sequence of events and agreements. The first is a development agreement dated March 7, 2007 entered into between the West Bengal Housing Infrastructure Development Corporation Limited (for short, "the HIDCO"), which is a Government of West Bengal Company and Shapoorji Pallonji and Company Limited (in brief, "the SPCL"), a public company not being an instrumentality of the State.
The salient clauses of the same are to be examined for the present purpose, since the said agreement is the genesis of the entire sequence of events.6
The very first clause in the recital declares that the Government of West Bengal, through the HIDCO, has decided to undertake a large scale construction of Housing Complex in order to address the housing problem in Kolkata by implementation of a Mass Housing Scheme in the New Town, Kolkata.
With this end in view, the HIDCO had invited Detailed Expressions of Interest (DEOI) for construction of dwelling units for low income group and middle income group along with physical and social amenities. The HIDCO shall provide peripheral services including approach road, drinking water supply, street lighting, storm water drainage and sewerage etc. and may also facilitate for providing required power supply. Clause 4 of the agreement provides that the project was to be implemented, phase-wise, in all respects within four years from the date of handing over land to the Developer or from the date of sanction of the plan, whichever is later. Clause 5 iterates that SPCL was selected for being awarded with the sole responsibility of developing the Mass Housing Scheme in the New Town, which was subject to the terms and conditions of the Letter of Allotment. 7 Pursuant to the application of the SPCL, it was allotted the residential plot for development and construction of dwelling units for LIG and MIG for implementation of Mass Housing Scheme. HIDCO's obligations are stated in Clause 5, sub-clause (a) of which provides, in no uncertain terms, that until the completion of Mass Housing Project, the possession of the said land by SPCL shall not be exclusive but jointly with HIDCO. Sub-clause (g) provides that the HIDCO is not only to provide phase- wise peripheral services including approach road, water supply, etc. but also may engage a competent Project Management Engineering Firm at its own costs for monitoring and supervision of the project work. Importantly, Clause 6 (C) of the agreement provides, among other things, that if the construction of the Scheme is not completed and handed over to the successful allottee within four years, SPCL shall be held liable to compensate suitably HIDCO and the allottees of the flats "as may be decided upon".
Clause 7 (f) provides that SPCL shall be entitled to execute conveyance deeds for and on behalf of HIDCO, although SPCL would retain the 8 sale proceeds after payment of the consideration amount to HIDCO.
Clause 8 throws further light in this regard. According to it, the HIDCO shall be entitled from time to time to make reasonable inspection of all the works, other records of SPCL regarding implementation of the dwelling units including common amenities in Mass Housing Plot and give such directions and instructions in respect thereof to SPCL as may be deemed necessary. Further, in case HIDCO finds any wilful gross default on the part of SPCL, HIDCO shall be entitled to give such directions as it may deem fit and proper and SPCL will comply and/or implement the same to that extent.
Clause 11 (a) stipulates that SPCL will allocate land in the project area as per the Scheme approved by HIDCO with regard to the social facilities like school, market, hospital, etc. as described in the Fourth Schedule to the agreement.
In case of disputes, Clause 13 speaks of arbitration before the Secretary, Housing Department, Government of West Bengal or any person nominated by him.
In a word, the entire agreement speaks of SPCL to act as the developer/agent of HIDCO for 9 the specific purpose of implementing the Government scheme of providing affordable housing to the LIG and MIG people.
The argument of privity of contract between the SPCL and the HIDCO is neither here nor there, since the agreement between them clearly reflects the very purpose of the agreement to be implementation of the Government scheme to provide housing to the Lower Income Group and Middle Income Group sections of West Bengal.
The clauses thereof, as discussed above, are sufficiently germane to elucidate that the very purpose of the project is in public interest.
The above clauses clearly show that the control and liability of the HIDCO, including possession of the land, is retained till the end of the project, which can only culminate in its natural course upon handing over of the houses to the target group of allottees.
The respondents seek to highlight the commercial aspect of the transaction between the respective allottees (including the petitioners) and the SPCL. However, the public element in the purpose of the entire project overshadows the monetary transactions. It is absurd to suggest that all public projects are free. Even providing 10 housing, which is a basic and integral component of the right to life guaranteed by the Constitution of India, at reasonable rates to low and middle- income groups is evidently a project in public interest.
The SPCL merely acts as an agent of the Government, through the HIDCO (which is a Government Company) to implement the Government's task of providing housing at affordable rates to disadvantaged strata of society.
The transaction may be commercially viable from the point of view of the SPCL, inasmuch as it gets to retain the sale proceeds, but such ingredient simpliciter cannot confer a commercial hue to the public project.
The counter to the privity argument also finds shape in Clause 6 (C), which stipulates, as one of the obligations of the SPCL, that if the construction of Mass Housing Scheme is not completed and handed overto the successful allottees within the said four years' time, SPCL shall be liable to compensate suitably HIDCO and allottees of the flats as may be decided upon.
Thus, the writ petitioners' rights to get timely possession of the flats, in the capacity of finalized 11 allottees of the scheme/project, in the alternative, suitable compensation from the SPCL after the stipulated four years, flow from the Development Agreement dated March 7, 2007 itself, despite the individual allottees not being signatories thereto.
The entire authority of the SPCL flows from the project and the development agreement, as amended till date, which, in turn, is necessitated by and directed towards providing affordable housing to sustain the lives of citizens, which is obviously a function of the Welfare State, that India is as per her Constitution. The Bengal Shapoorji Housing Development Private Limited (or "the BSHDPL") is at best an instrumentality in the entire chain of events leading to the writ petition, being a sub-agent of the SPCL.
The 'Sukhobrishti' project floated by the SPCL and the deeds/agreements entered into between the individual allottees (including the petitioners) and the SPCL, thus, are a sequel to the development agreement between SPCL and the HIDCO, which cannot be interpreted in isolation to invoke privity as a bar to the writ. The contract between the allottees and the SPCL are not statutory contracts. However, the entire housing project, of which the individual contracts are 12 components, definitely involves a public law element.
Inasmuch as the West Bengal Housing Board Act, 1972 is concerned, the same is not attracted in the present case, nor is the SPCL a joint enterprise with the Government. Nevertheless, the public law element involved in the scheme under consideration cannot be brushed aside.
The allottees admittedly belong to the lower and middle-income groups and evidently have much at stake since a substantial chunk of their savings and income must have gone into the mass housing project, in the hope of having homes to call their own. The inordinate delay even prior to and after the pandemic lockdown apparently occasioned by the SPCL and its instrumentalities, at least prima facie, indicate serious abuse of resources meant for public housing and translate to increasing costs for all concerned.
There is no dispute as to interpretation of the terms of the relevant agreements, nor are there any serious disputed questions of fact of complex nature requiring oral evidence to prima facie observe that there has been a gross dereliction of duty on the part of the HIDCO in not ensuring that the mass housing project is completed within 13 reasonable time. The HIDCO retains joint possession with the SPCL as per their mutual development agreement and, as per its clauses, both the HIDCO and the allottees are entitled to compensation from the SPCL for not completing the project in time.
Coming to the decisions relied on by the respondents, the legal tests laid down in Joshi Technologies International Inc. v. Union of India & Ors., reported at (2015) 7 SCC 728, for interference under Article 226 of the Constitution are, thus, satisfied in the present case.
In Eastern Coalfields Limited v. Ravi Udyog & Ors. [1994 Supp (2) SCC 466], a money claim was made, for which the Supreme Court remanded the matter to the High Court, directing the writ petition to be treated as a plaint. No proposition of law relevant to the present case has been laid down in the said case.
The third decision cited by the respondents, being Pimpri Chinchwad Municipal Corporation & Ors. v. Gayatri Construction Company & Anr. [(2008) 8 SCC 172], reiterates the proposition that private contracts between parties are governed by the Contract Act, which is a matter either for arbitration or for the civil court. However, in view 14 of the public law element involved in the instant lis, the said ratio is inapplicable here.
The question raised in the present writ petition is not restricted merely to interpretation or implementation of a private contract but covers a broader spectrum inasmuch as the alleged dereliction of the public duty cast on the HIDCO and SPCL, as its agent in the public scheme, in implementing the mass housing project meant for LIG and MIG cross-sections of society is concerned. The public element and the entire chain of events giving rise to the cause of action here relate back to the development agreement dated March 7, 2007, which was to carry out a mass housing scheme. Hence, the scheme and the said agreement together form the core of the common cause of action for all the petitioners.
Inasmuch as the relief B), relating to compensation package, is concerned, the same is only an ancillary relief consequential to the main reliefs sought in the writ petitioner.
In view of the above discussion, the present writ petition is maintainable in law and its present form. Thus, the maintainability issue is held in favour of the petitioners.15
As such, the writ petition is required to be heard on merits and shall be enlisted for final hearing in the monthly combined list of cases for January, 2023, to enable the respondents to challenge this order, if they so choose, in the meantime.
Urgent server copy of this order be supplied to the parties upon compliance of all formalities.
(Sabyasachi Bhattacharyya, J.)