Anil Shrikishan Agrawal vs The State Of Mah And Anr
2021 Latest Caselaw 13804 Bom

                                                           WP-4801-2012 judg.odt
                                      (1)


        IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                   BENCH AT AURANGABAD

                      WRIT PETITION NO.4801 OF 2012

Anil S/o Shrikishan Agrawal,
Aged: 49 years, Occ: Business,
& Proprietor of M/s. Sudarshan
Solvent Industries,
C/o Radhe-Radhe Jewellers,
Bhusar Line, Latur,
Tq. &b Dist. Latur.                                 ...Petitioner

                Versus

1.     The State of Maharashtra,
       Through its Secretary,
       Ministry of Industries,
       Maharashtra State, Mantralaya,
       Mumbai-32.

2.     Maharashtra Industrial
       Development Corporation,
       (Govt. of Maharashtra Undertaking),
       Through Regional Ofcer,
       Maharashtra Industrial
       Development Corporation,
       Nanded.                                      ...Respondents

                                  ...

Mr. Patil N.P. Jamalpurkar, Advocate for the Petitioner. Mr. S.G. Sangle, AGP for the Respondent No.1/State. Mr. S.S. Dande, Advocate for Respondent No.2.

...

CORAM : RAVINDRA V. GHUGE & S.G. MEHARE, J.J.

RESERVED ON : 06th SEPTEMBER, 2021

PRONOUNCED ON : 24th SEPTEMBER, 2021

JUDGMENT (PER S.G. MEHARE, J.) :-

1. The petitioner has impugned the communication of respondent

no.2 dated 10.05.2012 cancelling the allotment of the plot situated in

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MIDC Kalamnuri.

2. The facts giving rise to this petition are that plot no. 17-A

measuring 12344 square meters was allotted to the petitioner by letter

of allotment dated 03.02.2003. The petitioner executed a registered

agreement with the Regional Ofcer MIDC on 28.02.2003. The plot was

delivered in possession of the petitioner on 17.03.2003. The petitioner

had to construct the industry on the allotted plot within seven years from

the date of the agreement. Besides, according to the agreement terms,

he was to fence the plot, plant the trees and pay service charges

determined by the respondent.

3. The petitioner failed to comply with the terms of the agreement in

the given time. Hence a show cause dated 14.07.2010 was served on

him. The petitioner placed his reply dated 03.08.2010 and explained

that the water arrangement could not be made. Due to the defcit rainfall

for the last three years and the global economic crisis, he could not raise

the construction on the plot. Lastly, the petitioner requested the

extension of one year for obtaining the Building Commencement

Certifcate.

4. In response to his letter, respondent no.2, by its letter dated

19.11.2010, called upon the petitioner to submit the copy of the bank

loan application, copy of fre NOC proposal, and the copy of the building

map. By letter dated 1.12.2010, the petitioner submitted the copy of

loan proposal and fre NOC. He contended in the said letter that he tried

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to pay service charges of Rs. 52,664 at Parbhani Ofce, but that was

not accepted. By letter dated 01.12.2010, the petitioner objected to the

demand of Rs.01,02,455/- towards the service charges. By letter dated

11.01.2011, respondent no.2 informed the petitioner that he should clear

the arrears of service charges frst so he may take appropriate decision

on his request to extend the time to construct the factory. By letter dated

29.03.2011, it was informed to the petitioner that the service charges

were imposed after sanctioning the maps. Lastly, respondent no.2, by

impugned decision, cancelled allotment of his plot.

5. The petitioner challenged the impugned order mainly on the

ground that the petitioner could not construct the factory since the

respondent did not provide the water facility. The drastic action

cancelling the allotment of the plot was unwarranted when the dispute of

assessing the service charges was pending. The necessary facilities

were not available in the Kalamnuri Industrial Area. Therefore, the plot

holders could not construct the factory buildings. The water facility and

other amenities were lacking. No action was taken against similarly

situated plot holders, but the respondent took drastic action against him

only. Before issuing the impugned order, no hearing was given to him.

No show cause notice was served on him. Such conduct of respondent

no.2 violates the principles of natural justice and Article 14 of the

Constitution of India. The rules and guidelines for assessing the service

charges were never supplied to him. He went to deposit the amount of

Rs.52,664/-, but the Ofcer of the respondent has not accepted the

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money. He was not at fault for not paying the service charges. He was

willing to comply with all the conditions relating to the construction of the

factory building within two years, subject to the condition that the

respondent shall provide all basic amenities i.e., water supply,

road/street, lights, etc. The impugned order is arbitrary, illegal against

the principle of natural justice. Hence liable to be quashed and set

aside.

6. The contesting respondent no.2 fled his afdavit in reply. He did

not dispute the correspondence between them. However, he opposed

the petition contending that the petitioner has no legal right to insist the

respondent to extend the time to complete the construction and obtain a

Building Completion Certifcate. The petitioner was granted a

reasonable opportunity to construct the factory on the plot in question.

Though the building plans were approved, the petitioner did not build a

factory for about nine years. The inaction of the petitioner shows his

interest in not developing the plot in question. The petitioner has no

vested right for extension of time as prayed by him. The petitioner is a

mere licensee of the corporation, and the respondent has the power to

terminate the said agreement and restore the land allotted. The petition

is not liable to be entertained as it involves disputed questions of fact

and the dispute arising out of the agreement executed between the

parties. The petitioner has a statutory and efcacious remedy for the

dispute raised in this petition, and without availing the same, the present

petition is bad in law. The terms and conditions of the agreement bind

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the petitioner. The construction ought to have been completed within

seven years of delivering the possession of the plot in question. The

petition is on fimsy grounds. The petitioner took around three acres of

land without paying a single pie towards the service charges to the

respondent. From time to time, the correspondence was made, and the

facts were brought to the notice of the petitioner, but he did not take any

appropriate steps to follow the terms of the agreement. The time to

construct the building was reduced to four years from seven years,

which was also brought to his notice. The letters were sent from time to

time to the petitioner, seeking explanation. The petitioner has no

substantial grounds to seek extension.

7. To show the conduct of the petitioner, respondent no.2 has fled

an additional reply dated 31.08.2021 contending that the petitioner has

got various plots in MIDC at Latur, and instead of constructing the

factories or units, he has used the said plots for residential purposes.

By these facts, respondent no.2 tried to show that the petitioner had no

intention to develop the plot in question. To support such contentions,

he fled few photographs on record. He prayed to dismiss the petition.

8. Heard learned counsel Shri Patil for the petitioner at length and

learned counsel Shri Dande for respondent no.2 and learned AGP Shri

Sangle for respondent no.1-State.

9. Shri Patil, the learned counsel for the petitioner would argue that

the impugned order is arbitrary and against the principles of natural

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justice. He stressed his argument that neither many plots are developed

nor the factories are constructed in the Kalamnuri Mini Industrial Area.

However, the respondent deliberately chose the petitioner only and

made him a scapegoat. The required amenities like light, water, and the

road are still not available in the MIDC. The respondent failed to

discharge its duties to make such facilities and amenities available. The

respondent has no explanation how abruptly the service charges were

made double against the earlier demand of Rs.52,664/-.

10. He has further vehemently argued that the representation made

by the petitioner has not been considered in true perspective. The

overall conduct of the respondent reveals that it had made a mind to

evict the petitioner anyhow from the plot in question. The use of plots in

Latur MIDC is not the question before this Court in this petition; hence

the allegations of change of use of those plots have no relevance. He

would also argue that the petitioner was and even today ready and

willing to construct the factory on the plot in question, but he couldn't

comply with the terms of agreement for want of facilities. He would also

argue that the petitioner is ever ready to raise the unit/factory on the

plot, provided the respondent shall make all the amenities available. He

tried to make out a case that it is the respondent whose inaction to

develop the MIDC and provide necessary amenities and facilities cause

the failure of the construction of the factory not only by him but by many

other industrialists. Stressing his argument on not following the

principles of natural justice, he would pray to quash the impugned order.

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11. Per contra, Shri Dande, the learned counsel for respondent

no.2, taking the Court through the record and various correspondence

and communications between the petitioner and respondent no.2

pointed out, that the overall conduct of the petitioner is not bonafde.

Referring to clauses of the agreement, he would further argue that there

were specifc conditions in the agreement that the plot holder has to

construct the factory anyhow within seven years from the date of

possession. Admittedly, the petitioner has raised no construction as

such. The petitioner obtained the sanction for the construction of the

factory and went silent till the service of notice dated 14.07.2010. He

would further argue that the extension of time for completing the

construction of factory building is the discretion of the respondent. No

one can claim an extension of time as a matter of right. Referring to the

various notices and the reply given by the petitioner, he would point out

that the overall conduct of the petitioner is explicit that he never intended

to comply with the terms and conditions of the agreement and utterly

failed to use the plot in question for the purpose for which it was allotted.

He vehemently denied the allegations of no facilities as argued by the

petitioner's counsel in the MIDC area. He would say that till 2010, the

petitioner never whispered or complained about the non-availability of

the alleged facilities and amenities. On the contrary, all the necessary

facilities were available. The intention of the petitioner is clear from his

conduct that he was not interested in developing the industrial unit.

Hence, no extension as prayed can be permitted.

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12. He relies upon catena of judgments against the petitioner, which

held that violation of the terms of the agreement would not allow

extending the time. He relied on the following cases:

1. Dalip Singh and Ors Vs. State of Haryana and Ors, MANU/SC/

1210/2018.

2. Phatu Rochiram Mulchandani Vs. Karnataka Industrial Areas

Development Board and Ors, MANU/SC/0214/2014.

3. National Project Construction Corporation Ltd Vs. State of

Maharashtra, 2015 (1) Bom C.R. 22.

4. Ashok Sursingh Bhimani and Another Vs. The State of

Maharashtra and Others in Writ Petition No.8248 of 2017 dated

19/07/2017.

5. Surajagrah Steel & Mines Pvt. Ltd., Gadhchiroli Vs. The Chief

Executive Engineer, Maharashtra Industrial Development Corporation,

and another in Writ Petition No.4354 of 2012 dated 13.03.2013.

6. Abhay S/o Jayantilal Shah Vs. The State of Maharashtra and

others in Writ Petition No.5213 of 2013 dated 25.02.2016.

7. Sau. Chandrakala w/o. Suresh Mugdiya (Jain) Vs. Maharashtra

Industrial Development Corporation and others in Writ Petition No.8295

of 2006 dated 21.04.2009.

8. Orissa Industrial Infrastructure Development Corporation Vs.

MESCO Kalinga Steel Ltd and Ors, (2017) 5 SCC 86.

9. Sethi Auto Service Station and Ors Vs. Delhi Development

Authority and ors, AIR 2009 SC 904.

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13. The law is settled, that the parties are bound by the

terms of an agreement or the contract. The parties to the agreement

reciprocally bind each other according to the terms and conditions of the

agreement/contract.

14. The agreement dated 28.02.2003 is an agreement for seven

years. The petitioner had the license only to enter the piece of land for

building and executing work thereon. Respondent no.2, by the

impugned communication dated 10.05.2012, cancelled the letter of

allotment of plot no. 17-A which was issued in favour of the petitioner for

the following reasons that the petitioner;

i) had neither paid the annual rent nor fenced the plot.

ii)        has made no development activities as per the sanctioned

           map,

iii)       has not constructed the factory within seven years as per

           clause 3(c) of the agreement,

iv)        the plot is lying unused,

v)         he had not planted the trees.

vi)        no service charges as contemplated in clause 3 (g) were paid,

vii)       he did not submit a bank loan sanction order.

15. As per Clause 3(a) of the agreement dated 28.02.2003, the

petitioner was bound to submit the specifcation, plan elevations,

sections of the factory building to the Ofcer appointed by respondent

no.2 for approval within 84 months from the date of the agreement.

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Respondent no.2 has complete control over such maps, elevation, and

plans. For the said compliance, the Licensee may be called upon by the

authority appointed by respondent no.2. As per Clause (b), the plot

holder was bound to fence the plot granted to him at his or her expense.

Clause (c) speaks of the work that shall not begin until the plans are

approved. Until no objection certifcate is obtained from the

Maharashtra Pollution Control Board, no building work shall be

commenced following the building regulations. Clause 3(d), which is

most relevant to the issue involved in this case, is reproduced

hereunder;

"(d)That he shall within a period of seven years from the date of this agreement hereto commence, and within a period of seven years from the said date at his own expenses and in a substantial and workmanlike manner and with new and sound material and in compliance with all Municipal rules, bye-laws and regulations applicable thereto and in strict accordance with the plans, elevations, details and specifcations to the satisfaction of the Executive Engineer and conformably to the building lines marked on the plan hereto annexed and the building Regulations, set out in the Second Schedule hereunder written, build and completely fnish ft for occupation a building to be used as an industrial factory with all requisite drains and other proper conveniences thereto."

16. Clause (d) imposes responsibility on the plot holder to plant the

trees in the open space. Clause (g) speaks of the service charges and

other charges to be paid by the plot holder as may be prescribed by the

State Government under MIDC Act, 1961 in respect of amenities or

common facilities provided by the grantor.

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17. Clause 5(b) of the agreement empower the respondent to

resume the land allotted to the holder of the plot on the failure of the plot

holder to make construction on the plot within seven years from the date

of the agreement, the plot holder defaults to pay the service charges or

fails to observe the terms of the agreement. Upon resuming the land, the

agreement shall cease and terminate.

18. The above conditions mandate the plot holder to construct the

industrial factory anyhow within seven years from the date of the

agreement. Considering the date of the agreement, it was incumbent

upon the petitioner to build the factory unit on or before 27.02.2010.

Since the petitioner raised no construction on the plot, the respondent

issued him the frst notice dated 14.07.2010, calling upon him why the

action shall not be taken against him for breach of the terms of the

agreement. The petitioner, by way of reply dated 03.08.2010 submitted

the explanation as discussed above.

19. In addition to the above, Clause (6) of the agreement empowers

the respondent to extend the period for completion of the factory

building and the necessary work for the said period mentioned in clause

3(d), if it is satisfed that the building and works could not be completed

within the prescribed time for reasons beyond the control of the licensee.

20. The petitioner accepted, particularly vide Clause 3(d), the

responsibility to commence the construction of the factory building

within seven years from the date of the agreement. The petitioner also

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knew, by letter dated 16.11.2007, that the period of seven years was

reduced to four years. He never challenged such reduction of tenure. It

is not in dispute that till the frst show-cause notice dated 14.07.2010, no

action was taken to cancel the allotment of the plot after four years from

the date of the agreement. The respondents waited for seven years and

then initiated the action. The burden is on the petitioner to prove that

there were reasons for not raising the constructions within a given time.

Firstly he complained that the respondent did not make water facility

and infrastructure available, to any plot holder. He further explained that

there was defcit rainfall for the last three years and global economic

crisis. He has nothing to show that he ever complained of the lack of

water and infrastructural facilities. He tried to convince us that shortage

of rain for the last three years and a global economic crisis are the

reasons for not raising construction, and it was a situation beyond his

control. To believe his defence he placed no material that shortage of

rain and global economic crisis had a bearing on his project. He also

has no case; that for these reasons, the bank refused him the loan. He

never made any representation to respondent no.2 that he is facing

difculties as mentioned above in raising the construction until the show

cause notice dated 14.07.2010 was served on him. Indisputably, the

petitioner is in arrears of the service charges. He has a defense that he

went to pay the arrears, but the Ofcer refused. Had he intended to pay

the arrears, he could have paid by cheque or demand draft. On the

other hand, he went on disputing with the respondent about how the

charges were assessed. He could have paid the arrears under protest.

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That could throw light on his bonafde. Having regard to the

circumstances, we do not fnd substance in the arguments of the

petitioner that the situation was beyond his control which restrained him

from raising the construction of the factory within agreed time.

21. It is also the argument of the learned counsel for the petitioner

that the respondent was biased against the petitioner and took a drastic

step to evict him when numerous plot holders had not completed the

construction in the same MIDC area.

22. A person alleging bias against the authority has to place the

material or circumstances to believe the defense of bias. Bias is

inclination or prejudice for or against one person or group, especially in

a way considered unfair. It is a personal or sometimes unreasonable

judgment. The person alleging bias, shall prove instances of prejudice.

The petitioner has not placed a single example against respondent no.2

that he acted against his interest; he favoured others or did the acts with

malafde intention to evict the petitioner from the allotted plot. On the

contrary, no immediate action was taken within four years from the date

of agreement when the petitioner had not constructed the factory.

Respondent no.2 vide letter dated 11.01.2011, positively requested the

petitioner to clear the arrears frst so the appropriate decision may be

taken on his request to grant the extension. In the absence of material

that prejudiced respondent no.2 against the petitioner, the bare

allegations of bias have no meaning.

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23. The learned counsel Shri Dande for respondent by fling

additional reply, would argue that the plots in MIDC Latur were allotted

to the petitioner for construction of the factory, but instead of

constructing the factories, he constructed residential houses on those

plots. That shows his conduct that he never intended to use the land for

the purpose for which those were allotted. We are not impressed by his

arguments for the reasons that no issue of its change of user is before

us, and no material is placed in this case for what purpose those plots

were allotted to him. We are unaware what restrained respondent no.2

or the concerned Ofcer from taking action for the breach of agreement,

if any.

24. The learned counsel Shri Dande would argue that the plot

allotted under an agreement was subject to the terms and conditions

therein. Therefore, it could not be kept idle for stalling and stultifying

industrial growth of the area. To bolster his argument, he relied on the

case of National Project Construction Corporation Ltd (Supra). He

would also rely on the case of Ashok Sursingh Bhimani (Supra) and

argue that the properties of MIDC are public. Therefore in violation of

the terms of the agreement, the public property cannot be retained by

private persons. He also relied on the case of Abhay S/o Jayantilal

Shah (Supra), and argued that just applying for construction permission

would not mean taking the steps for the development of the property in

its real sense. In this case, the facts are that the petitioner has obtained

only the plan sanctioned from the concerned authority of the respondent.

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The above case law come to the aid of the learned counsel Shri Dande.

25. The facts and material placed on record indicates that the

petitioner breached the agreement terms. There were no circumstances

beyond the control of the petitioner that restrained him from constructing

the factory within the agreed time. Therefore nothing is there to believe

that the action cancelling the allotment of plot for the given reason is

arbitrary, perverse, and against the principle of natural justice.

26. In the light of the above, we do not fnd that judicial indulgence

is necessary in this case. Accordingly, the petition is devoid of merit;

hence dismissed. Thus, the interim orders stand vacated.

27. The learned counsel for the petitioner prayed to extend

the interim relief for eight weeks.

28. We have discussed the issues at length. The plot in

question is vacant and unused since 2003. It is a plot to be

commercially used. The MIDC is getting no revenue since then. The

petition was pending for about nine years. It would be improper to put

the MIDC at further loss. Hence, we reject the prayer.

   (S.G. MEHARE, J.)                           (RAVINDRA V. GHUGE, J.)




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