M/S.Sai Aditya Assets, vs The State Of Andhra Pradesh,
2021 Latest Caselaw 1399 AP

                                1




          *HON'BLE SRI JUSTICE D.V.S.S. SOMAYAJULU

               + WRIT PETITION No.12779 of 2019


                      % 5TH MARCH, 2021


#   M/s Sai Aditya Assets,
    Rep. by its Managing Partner, Sri Seshagiri Rao,
    APSEB Colony, Seethammadhara, Visakhapatnam.
                                                           ... Petitioner


                               AND

$ The State of A.P. rep. by its Principal
   Secretary, Municipal Administration and
   Urban      Development,     Secretariat,
   Velagapudi, Guntur District and two
   others.
                                                       ... Respondents.



! Counsel for the Petitioner          : Sri C. Raghu




^ Counsel for the 1strespondent :    Government Pleader for
                                     Municipal Administration


^ Counsel for the 2ndrespondent:     Sri S. Lakhsmi Narayana Reddy
                                     Standing counsel for GVMC


^ Counsel for the 3rdrespondent:     Sri V. Surya Kiran Kumar
                               Standing counsel for VMRDA.




< Gist:

> Head Note:


? Cases referred:
1) AIR 1986 SC 806
2) AIR 2020 SC 2954
3) (1990) 3 SCC 280
                                     2




       HON'BLE SRI JUSTICE D.V.S.S.SOMAYAJULU

               WRIT PETITION No.12779 of 2019

ORDER:

The prayer in the Writ Petition is as follows:

".....to issue a writ order or Order more in the nature of Writ of Mandamus or any other appropriate writ, order or direction, declaring the action of the 1st respondent in issuing G.O.Ms.No.93, MA & UD, dated 01.03.2019 allotting only 91 cents (4404 Sq.yards) in Sy.No.350/2, Madhurawada village out of the total land to the extent of Ac.1-95 cents agreed to be allotted to the petitioner firm and also not providing the benefit of Tourism Policy 2015-20 and five years lease rental waiver which was agreed vide Memo No.3808/M2/2014, dated 11.05.2018 and Letter Rc.No.2340/2018/Estate/F1, dated 01.05.2018 of the 3rd respondent as illegal and arbitrary and further direct the 1st respondent to comply with the conditions contained in the Memo No.3808/M2/2014, dated 11.05.2018 of the 1st respondent by issuing appropriate orders and pass such other order or orders as may deem fit and proper in the circumstances of the case."

The petitioner before this Court is the successful

tenderer in a tender that was notified in the year 2012 for

development of plots of a land in MVP Colony, Visakhapatnam.

The tender was floated by the 2nd respondent. This tender was

floated for the development of the site under the Public Private

Participation Mode (P.P.P. Mode). The site measures Ac.0-91

cents in MVP Colony / ChinnaWalatair. For various reasons

the allotment of the site and the physical development of the

same was delayed and ultimately the petitioner filed a Writ

Petition No.41619 of 2017 followed by W.P.No.5543 of 2018

challenging the decision taken by the State. An interim order

was granted by the Court in W.P.No.5543 of 2018 restraining

the State and others from allotting the site of Ac.0-91 cents in

Sy.No.21/1P of MVP Colony to the third parties. Thereafter

the authorities entered into a dialogue and according to the

petitioner an alternative site measuring Ac.1-95 cents in

Sy.No.350/2 of Madhurawada village was agreed to be allotted

to the petitioner on the condition that he withdraws the Writ

Petition and accepts the site. The petitioner submits that

consequent on the representations made by the respondents,

they have withdrawn the Writ Petition and after the Writ

Petition was withdrawn the petitioner was allotted only Ac.0-91

cents in Madhurawada instead of entire Ac.1-95 cents. This is

the sum and substance of the dispute. According to the

petitioner the rule of promissory estoppel clearly applies and

that the Writ Petition was withdrawn on the representation

made that he would be allotted alternative site of Ac.1-95 cents

in Sy.No.350/2 of Madhurawada in lieu of Ac.0-91 cents in

Sy.No.21/1P of ChinnaWaltair/ MVP Colony (Land in

Sy.No.21/P of ChinnaWaltair / MVP Colony, Visakhapatnam is

hereinafter called the "Original" site and the land in

Sy.No.350/2 of Madhurawada is called the "alternative" site).

Learned counsel for the petitioner Sri C. Raghu argues

that this is clear case of promissory estoppel. According to

him a representation was made by the 2nd and 3rd

respondents, pursuant to which the petitioner has changed his

position / stand and withdrew the Writ Petition. After the Writ

Petition was withdrawn, according to the learned counsel for

the petitioner, the respondents have gone back on their

promise. He points out that from a reading of the

correspondence at more than one place the State had agreed

that the alternative land for Ac.1-95 cents in Madhurawada is

to be allotted since the petitioner was surrendering the original

land of Ac.0-91 cents in ChinnaWaltair / MVP Colony. He

draws the attention of this Court to the Memo dated

15.05.2018 issued by the Principal Secretary to the

Government, wherein the petitioner was directed to withdraw

the Writ Petition and notes that the Vice Chairman of the

3rdrespondent-Visakhapatnam Metropolitan Region

Development Authority has identified an alternative land

measuring Ac.1-95 cents for allotment. He also draws the

attention of this Court to the Memo dated 07.05.2018 wherein

in paragraphs 4 and 5 this proposal has been noted and

reiterated. Learned counsel for the petitioner states that the

Government gave its "in principle" approval in paragraph 4 of

this Memo dated 07.05.2018 for giving Ac.1-95 cents of land

situated in Sy.No.350/2 of Madhurawada village as alternative

land for the Ac.0-90 cents in ChinnaWaltair (original site). In

paragraph 5 learned counsel points out that they were directed

to take necessary steps to withdraw the case and submit a

detailed proposal to the State for processing the same.

Learned counsel argues that based on these representations of

the State / the respondents, the petitioner withdrew the case.

Unfortunately, learned counsel submits that the petitioner was

not given the entire Ac.1-95 cents in Madhurawada and it was

only allotted Ac.0-91 cents. This is the order that is being

questioned.

Relying upon the judgments of the Hon'ble Supreme

Court of India reported in Union of India and Ors., v Godfrey

Philips India Ltd.,1;Union of India and Another v V.V.V.

Limited and Another2and M/s Star Enterprises and Others

v City and Industrial Development Corporation of

Maharashtra Ltd., and Others 3 learned counsel for the

petitioner argues that this is an absolutely fit case where the

principle of promissory estoppel should be applied and an

order should be given in favour of the petitioner.

Sri V. Surya Kiran Kumar, the learned standing counsel

for the VMRDA took the lead and argued the matter on behalf

of the respondents. Sri S. Lakshmi Narayana Reddy, learned

standing counsel for the 2nd respondent and the learned

Government Pleader for Municipal Administration supported

the case set up by the 3rdrespondent and argued on the same

lines.

The sum and substance of the respondents' argument is

that there is no enforceable right in the petitioner to seek a

Writ of Mandamus and that there is no concluded contract

between the petitioner and the 3rd respondent, in particular

AIR 1986 SC 806

AIR 2020 SC 2954

(1990) 3 SCC 280

VMRDA. Sri V. Surya Kiran Kumar also submits that the

petitioner has been regularly filing writ petitions and that the

repeated filing of the Writ Petitions is not permissible as per

the judgments of the Hon'ble Supreme Court of India. He also

argues that the Government Memos do not confer any

enforceable rights on the petitioner and that they are mere

executive instructions which cannot be enforced under law. It

is again reiterated that as there is no letter of intent or letter of

award there is no enforceable right available with the

petitioner. He also relies upon a judgment of the Hon'ble

supreme Court of India, which is also relied upon by the

petitioner, in VVF Limited case to argue that principles of

promissory estoppel do not apply and that the petitioner does

not have right to claim Mandamus.

This Court after hearing all the learned counsel and

perusing the records notices that there is no dispute about the

essential facts. The fact that the petitioner filed a tender in

2012 and that he filed the Writ Petition, which was withdrawn

as there was a proposal for allotting alternative bit of land

which reached the highest hierarchy in the State Government

etc., is not really in dispute. The only question is whether the

petitioner is entitled to the reliefs prayed for.

The primary objectionsof the learned standing counsel

for the 3rd and 2nd respondentsis that in the absence of a

concluded contract or /and as the petitioner is relying upon a

memo he is not entitled to Writ of Mandamus. It is not out of

place to mention that the principal of promissory estoppel is a

principle of equity. It is not necessarily based upon a contract

and there is no need for a written contract to be in place before

a person can base his claim on the principle of promissory

estoppel. In page 30, para 32 of the judgment in VVF Ltd.,

case it was held as follows:

"32. The doctrine of promissory estoppel is by now well recognized and well defined by a catena of decisions of this Court. Where the Government makes a promise knowing or intending that it would be acted on by the promise and, in fact, the promise, acting in reliance on it, alters his position, the Government would be held bound by the promise and the promise would be enforceable against the Government at the instance of the promise notwithstanding that there is no consideration for the promise and the promise is not recorded in the form of a formal contract as required by Article 229 of the Constitution. The rule of promissory estoppel being an equitable doctrine has to be moulded to suit the particular situation. It is not a hard-and-fast rule but an elastic one, the objective of which is to do justice between the parties and to extend an equitable treatment to them. This doctrine is a principle evolved by equity, to avoid injustice and though commonly named promissory estoppel, it is neither in the realm of contract nor in the realm of estoppel. For application of the doctrine of promissory estoppel the promise must establish that he suffered in detriment or altered his position by reliance on the promise."

A reading of this passage would make it very clear that

when the State or a party makes a promise and the petitioner

or the other party changes its stand, the State or the party is

bound by the same. It is a doctrine based upon equity for

which there is no hard and fast rule. The ultimate objective of

this rule is to do justice between the parties and to extend

equitable treatment. In this judgment the Hon'ble Supreme

Court of India clearly held that what is necessary is that there

should be a promise, action upon the said promise and that

the petitioner should change his position. If these conditions

are satisfied the respondent can be compelled to honourits

promise and that there is no need for a formal contract and /

or for consideration. In the opinion of this Court this passage

of the Hon'ble Supreme Court of India which reproduces the

law on the subject is a sufficient answer for the entire defense

that has been raised by the respondents including the aspect

of reliance on memos etc. In the opinion of this Court there is

no need for a formal contract nor is there a need for

consideration. If the Government makes a promise, whether it

is in the form of a letter, memo or otherwise and the party

acted upon it, the equitable rule of promissory estoppel will

come into play. Although the case law mentioned by the

learned counsel for the respondents in his counter is not in

doubt, the fact remains that in this case there was a promise /

representation and a change of the position by the petitioner to

his detriment. In the opinion of this Court, this change in the

position of the petitioner based upon the representation of the

State/respondentsthrough memos / letters etc., is enough for

him to seek a Mandamus. The equitable doctrine of promissory

estoppel gives him the right to approach this Court and to

claim the relief. It is the "promise" and the change / alteration

in the stand that is material and not whether it is in a letter /

contract or even a mere memo.

If the facts of the case are examined in detail,the letter

dated 01.05.2018 is addressed by the 3rd respondent which

was earlier known as the Visakhapatnam Urban Development

Authority. In this letter dated 01.05.2018 the Vice Chairman

of the 3rd respondent clearly spelt out that an alternative land

has been identified and that the request of the petitioner for

allotment of equivalent alternative land on lease basis and also

the lease terms and conditions submitted to the Government

for orders. It is equally important to note that the value of the

original land of Ac.0-91 cents is mentioned as Rs.45,000 per

Sq.yardequivalent to Rs.45,000 x 4404 Sq.yardsi.e., Rs.19.81

crores. The value of the proposed alternative land of Ac.1.95

cents equivalent to 9,438 Sq.yards is also exactly the same.

(9,438 x 21,000 per Sq.yards equals to Rs.19,81,80,000/-).

Therefore, a reading of this letter makes it clear that the

alternative land that was identified in Madhurawada village

measuring Ac.1-95 cents is exactly equal in value to the land

which the petitioner has bid for i.e., Ac.0-91 cents in MVP

Colony. This letter dated 01.05.2018 is replied by the

Government on 15.05.2018,whereunderit is mentioned that

the proposal has been processed.Paragraphs 5 to 7 of this

letter make it very clear that what was processed was the

proposal of the 3rd respondent in the letter mentioned above.

The 2nd respondent was also directed to identify the suitable

land parcel against the land in Sy.No.21/1P in China Waltair

to an extent of Ac.0-91 cents (original land) and handover

theexisting site to the Collector, Visakhapatnam for handing

over to a thirdparty. The reply to this is the letter dated

07.05.2018 addressed to the 3rd respondent by the State in

paragraph 4 shows the "in principle" approval of the

alternative land measuring Ac.1-95 cents is conveyed along

with the direction tothe petitioner to withdraw the Court case

and to submit a proposal to the Government for allotment of

Ac.1-95 cents (9438 Sq.yards) in Madhurawada village. This is

followed by a letter dated 11.05.2018 containing the same

contents. The next letter is dated 15.05.2018. In this letter

also it ismentioned that the Government wanted to allot this

land of Ac.0-90 cents in China Waltair, MVP to a third party

for another project including a Mega Convention Centre etc.,

and that the 2nd respondent has identified the land

measuringAc1-95 cents in Madhurawada. This letter was also

marked to the petitioner with a request to withdraw all his

cases. Ultimately, after the case was withdrawn the impugned

order came to be passed, by which only Ac.0-90 cents out of

Ac.1-95 cents allotted in Madhurawada.

This Court notices that the reason why the State pursued

this course is because, as a part of their policy they have

decided to allot certain lands to another entity for development

of shopping mall, convention Centre etc. Vide G.O.Ms.No.5

dated 16.02.2018 these proposals were adopted. Therefore,

the original land of Ac.0-91cents, which was allotted to the

petitioner was taken over by the State and handed over to

some other parties in terms of the abovementioned G.O. The

Petitioner on the other hand was to be given the alternate land

identified in Sy.No.350/2 of Madhurawada village.

The State and the respondents are supporting their

arguments by stating that the original Ac.0-91 cents of land

which was allotted to the petitioner is equal to the alternate

Ac.0-91 cents of land which is now proposed to be allotted in

Madhurawada village. However, the fact remains that very

reading of the letter of the 3rd respondent itself which is

mentioned the market value of Ac.0-90 cents of land in MVP

colony, China Waltair (originally allotted to the petitioner) is

equal to the market value of Ac.1-95 cents of land in

Sy.No.350/2A, Madhurawada(the alternative land). For a

businessman or a business entity like the petitioner the value

of the land is as important as it's extent. Financial viability

and other factors for the project depend on the value also. The

State in the opinion of this Court cannot advance this

argument because basing on the representation made by the

State and the correspondence, which is detailed above, the

petitioner has changed his stand and acted upon the

representations and has withdrawn his Writ Petition. The

action of the petitioner in withdrawing his case has facilitated

the State in handing over the lands to another party in terms

of G.O.Ms.No.5, dated 16.02.2018 and the State has also

benefited from the same. This case, in the opinion of this

Court, is a classic case for applying the principle of promissory

estoppel. The correspondence exchanged between the parties

clearly showsthat the proposal was mooted at the District level

and it went upon to highest echelons of the State / the Head

Quarters and thereafter the petitioner withdrew his case.

The matter was also reopened to enable the learned

counsels to argue if on the ground of larger public interest etc.,

the principle of promissory estoppel will not apply. The case

law on the subject makes it clear that if there is a larger public

interest the doctrine of promissory estoppels must yield. The

learned counsels argued this issue also. This Court after

hearing the submissions notices that there is no supervening /

larger public interest which would enable the respondents to

resilefrom their commitment. The land that was allotted to the

petitioner was required by the State because they wanted to

transfer the same to another entity. This is visible from para-3

of the impugned order itself. The same can also be seen in the

letters dated 01.05.2018, 07.05.2018, 11.05.2018 and

15.05.2018. In all these letters exchanged between the

respondents, copies of which were marked to the petitioner, it

is clear that all the respondents wanted to allot this original

land Ac.0-90 cents in ChinnaWaltair / MVP to another entity

for the purpose of development of Mega Convention shopping

center by CMR group / Lulu International Shopping Mall Ltd.

Therefore, this Court finds that in fact there is only a

commercial interest of the State to develop this parcel of the

land along with other parcels of land and there is no

supervening "public" interest to hold that the doctrine of

promissory estoppel will not apply.

In that view of the matter, there shall be an order of

Mandamus directing the respondents to allot Ac.1-95 cents of

land in Sy.No.350/2 of Madhurawada village (alternative land)

to the petitioner along with all the other prayers made in the

Writ Petition.The petitioner has set out these conditions, which

were accepted in principle by the State, and in view of the

considerable delay this order has to be passed in line with the

same.

With the above observations the Writ Petition is allowed

in its totality. There shall be no order as to costs.

Consequently, the Miscellaneous Applications pending, if

any, in this writ petition is stands closed.

__________________________ D.V.S.S.SOMAYAJULU, J Date:05.03.2021.

Note: LR copy to be marked B/o Ssv