M/S Ahuja And Anand Real Estate ... vs State Of U.P. And 3 Others
2023 Latest Caselaw 2133 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

Court No. - 39
 

 
Case :- WRIT - C No. - 8596 of 2022
 
Petitioner :- M/S Ahuja And Anand Real Estate Pvt. Ltd.
 
Respondent :- State Of U.P. And 3 Others
 
Counsel for Petitioner :- Harsh Vardhan Gupta,Aditya Gupta
 
Counsel for Respondent :- C.S.C.,Anjali Upadhya
 

 
Hon'ble Mrs. Sunita Agarwal,J.

Hon'ble Vipin Chandra Dixit,J.

Rejoinder affidavit filed by the petitioner is taken on record.

Heard Sri Anurag Khanna, the learned Senior Advocate assisted by Sri Harsh Vardhan Gupta, learned counsel for the petitioner and Ms. Anjali Upadhya, learned counsel appearing for the Greater Noida.

The present writ petition is directed against the order of cancellation of the lease deed dated 8.9.2011, passed on 14.2.2022 by the Additional Chief Executive Officer, Greater Noida. The order impugned records that the petitioner has not complied with the terms and conditions of the lease deed by not depositing the lease rent and getting a plan sanctioned for completion of the project for a period of more than 10 years.

This order is sought to be challenged with the aid of provisos of Section 7 of the U.P. Industrial Area Development Act, 1976 (hereinafter referred to as 'Act, 1976') which reads as under:-

"7. Power to the Authority in respect of transfer of land. - The Authority may sell, lease or otherwise transfer whether by auction, allotment or otherwise any land or building belonging to the Authority in the industrial development area on such terms and conditions as it may, subject to any rules that may be made under this Act, think, fit to impose."

(Provided that where any land so allotted is not utilised for the purpose for which it was allotted within the period of five years from the date of possession or within the period fixed for such utilisation in the conditions of allotment, whichever is longer, the lease deed will stand cancelled and the land shall vest with the Authority:

(Provided further where the aforesaid period has already lapsed before the commencement of this Act, the Authority shall give a notice to the allottee to use the land for the purpose for which it was allotted within a period of one year and if within the above period of one year the allottee does not use the land, then the allotment and lease deed shall stand automatically cancelled."

It is sought to be submitted by the learned Senior Counsel for the petitioner that under the said provisos it was incumbent upon the authority to give notice to the allottee petitioner calling upon it to use the land for the purpose for which it was allotted, within a period of one year and in case, the allottee failed to use the land within the period of one year, the allotment and lease deed would stand automatically cancelled. It is submitted by the learned Senior Counsel for the petitioner that the provision of 2nd proviso to Section 7 of the Act, 1976 duly apply to the facts and circumstances of this case and the benefit of period of one year is required to be given to the petitioner. The provision is mandatory in nature and without complying with the same the cancellation order could not have been passed by the development authority. Learned Senior Counsel for the petitioner has placed reliance on the Division Bench judgments of this Court passed in the case of M/s Logix Infomedia (P) Ltd. Vs. State of U.P. and 4 others (Writ-C No.18969 of 2021, dated 1.9.2021) and M/s J.M. Housing Limited Vs. State of U.P. and others (Writ-C No.2238 of 2021, dated 2.2.2021), to substantiate these submissions.

In rebuttal, Ms. Anjali Upadhya, learned counsel appearing for the Greater Noida drew the attention of the Court to the notice dated 4.3.2020, whereby the petitioner had been called upon to deposit the entire premium and lease rent without 25% rebate provided to him under Mega Investment Rebate. It is noted in the said notice itself that last opportunity was given to the petitioner by the development authority to submit a construction plan for sanction and the time upto 31.3.2020 was given to submit the map with delay fees. The extension has been granted to the petitioner for execution of the project in the first phase uptill 31.3.2021 and permission for the second phase was then to be granted with extension fee within the time given by the development authority. It was duly informed that in case, the first phase of the project is not completed by 31.3.2021 the allotment would be cancelled.

On a query made by the Court as to what was the action of the petitioner after receipt of the notice dated 4.3.2020, no plausible answer could be given by the learned Senior Counsel for the petitioner. It is only submitted that representations were given by the petitioner seeking permission of the development authority to deposit the lease rent and submit the plan for construction.

It is further evident that despite opportunity granted to the petitioner and the relief in the Mega Investment Rebate to the extent of 25% for deposit of premium and lease rent, the petitioner has not deposited the lease rent. No plan has been submitted by the petitioner before the development authority to seek sanction for commencement of the project. For a period of 11 years, the petitioner has failed to comply the terms and conditions of the lease deed.

As regards the first and second provisos to Section 7, which puts rider on the power of the development authority to cancel the allotment, the object of the said provision is to provide opportunity to the allottees to complete their project within a period of one year, in case the project is not completed for any circumstance beyond their control. The allotment and the lease deed shall stand automatically cancelled in case of failure of the allottee. In the instant case, for the last 11 years, not only the petitioner has failed to commence the project but the lease rent under the lease agreement signed by the petitioner has not been paid in full. It is intimated by Ms. Anjali Upadhya, learned counsel for the respondent development authority that only two installments out of twenty towards lease rent have been paid by the petitioner. The cancellation order, thus, has been passed due to utter violation of the terms and conditions of the lease deed on the part of the petitioner. In the above circumstances, the petitioner cannot seek benefit of the first and second proviso of Section 7 of the Act, 1976 to alter the terms and conditions of the lease deed.

At this stage, the learned Senior counsel for the petitioner informs that under the order dated 4.4.2022 of this Court, the petitioner has deposited the entire lease rent without any interest. Only principal amount has been deposited towards the lease rent that too under the order passed by this Court after cancellation of the lease deed.

As we do not find any fault in the action of the development authority in cancellation of the lease deed on account of non-fulfilment of terms and conditions of the lease deed, we are not impressed by the deposits made by the petitioner under the order passed by this Court. No merit is, thus, found in the writ petition.

However, at this stage it is relevant to note that there is a policy of the Greater Noida to grant restoration of the allotted plot on completion of necessary formalities by the allottees. On the said submission of Ms. Anjali Upadhya, the learned Senior Counsel for the petitioner submits that the petitioner is ready and willing to apply for restoration of the plot in question in accordance with the policy of the Greater Noida Development Authority within a period of two weeks from today.

We, therefore, provide that in case the petitioner applies for restoration of the plot in question in accordance with the requirements of the policy framed by the Greater Noida, within a period of two weeks from today along with copy of this order, an expeditious decision in accordance with law shall be taken by the competent authority for restoration of the plot in question, strictly in terms of the policy framed by the development authority, preferably within a period of four weeks from the date of presentation of the application.

For a period of two months from today or till such a decision is taken by the competent authority, Greater Noida, whichever is earlier, no third party right shall be created over the plot in question.

However, in case of default on the part of the petitioner to move application for restoration or completion of necessary formalities, it would be open for the competent authority to proceed in accordance with law.

It goes without saying that, in case, the application filed by the petitioner for restoration of the plot in question finds favour with the competent authority, the sum of Rs.2,59,00,000/- deposited by the petitioner towards the lease rent under the order passed by this Court shall be adjusted against the deposits which are required to be made by the petitioner under the restoration policy. For any other deposits made by the petitioner under the terms and conditions of the lease deed, it would be open for the Greater Noida to deal with the same in accordance with its own policy.

With the above observations/directions, the writ petition is disposed of.

Order Date :- 20.1.2023

Kpy