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“13. Since the tenders were invited for grant of lease of five­star hotel plot, only bidders interested in development of 5­star Hotel participated in the bidding process. Had the Corporation invited tenders with residential + commercial use of the plot, several bidders could have participated in the bidding process and the Corporation might have fetched higher revenue. Due to change of user and sub­ division of the plot contrary to the terms and conditions of invitation of offer, several eligible bidders were deprived and also caused financial loss to the public exchequer. Besides this, due to change of user and sub­division of the plot, the basic object of development of 5­ star hotel is frustrated.

14. On the aspect of whether the change of user and sub­ division of the plot adversely affected the object of development of a five­star hotel, the order noted that the change of user and sub­division of plots were in contravention of the terms and conditions initially offered. Due to such changes, the basic object of development of a five­star hotel in Navi Mumbai was frustrated.

15. On the aspect of whether allotment of the plot, change of land use, and sub­division of plots was arbitrary, illegal, and unjustified, the order noted that the deviations could be categorized as major deviations from the terms and conditions mentioned in both the tender documents and letter of allotment. Such deviation frustrated the basic purpose of development of a five­star hotel. Therefore, it was concluded that the aspect of promissory estoppel against the CIDCO would not be applicable as specific terms of the tender and letter of allotment were deviated. Further, such deviations were not in public interest. Accordingly, the two lease deeds in favour of the respondents­lessees were cancelled.

16. Aggrieved by the cancellation of the lease deeds, M/s. Metropolis Hotels and Shishir Realty Pvt. Ltd., challenged the aforesaid order of the Vice Chairman, CIDCO, through two writ petitions being Writ Petition No. 702 of 2011 and Writ Petition No. 5245 of 2011 before the High Court of Judicature at Bombay. Separately, a PIL was also filed challenging the allotment of the plot in question, change of land use, and sub­division of the said plot.

17. The High Court, vide impugned order dated 06.12.2013, while quashing the aforesaid cancellation order passed by CIDCO, held that the change of land use and sub­division of the plot had taken place with due authorization of the CIDCO. Further, it held that the CIDCO was not able to show any concrete violations which go to the root of the matter. Finally, the High Court held that, without producing any pressing need on record, the CIDCO is precluded and estopped on the doctrine of promissory estoppel from canceling the allotment.

“1. The Government of Maharashtra through the Principal Secretary, Urban Development Department conducted enquiry into the irregularities in allotments of plots, change of user and deviation of the terms and conditions of the tender made by the then Vice Chairman and Managing Director, CIDCO, during the period from Ist October, 2009 to 31st March, 2010. The Principal Secretary Urban Development Department conducted the enquiry and submitted his report to the State Government on 03.11.2010. The change of user, sub­division and transfer of part of plot no. 5, Sector 46A, Nerul, to M/s Metropolis Hotels was also covered in the enquiry conducted by the Principal Secretary, Urban Development Department. The State Government accepted the findings and recommendations of the enquiry committee and directed the Managing Director, CIDCO, vide letter dated 19.11.2010, to implement the findings and recommendations of the Principal Secretary, Urban Development Department. The Principal Secretary has recorded his findings about the irregularities in acceptance of tender and breach of tender conditions, change of user, sub­division of plot and further transfer of part of the plot and further recommended cancellation of the tender process.