Bombay High Court
Abhishek Mahesh Garodia And Ors vs Mah.Hsg.Area And Dev. Authority And Anr on 23 April, 2025
Author: A. S. Gadkari
Bench: A. S. Gadkari
2025:BHC-OS:6810-DB
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.1940 OF 1999
1. Abhishek Mahesh Garodia, ]
Age 46 years, Indian inhabitant, ]
residing at Garodia House, ]
M.G. Road, Ghatkopar (East), ]
Mumbai: 400 077. ]
2. Rohit A. Goyal ]
Age 43 years, Indian inhabitant, ]
residing at 5, Zenith Park, Deonar ]
Farm Road, Deonar Chembur, ]
Mumbai 400 088. ]
3. Sarita M. Garodia ]
Age 73 years, Indian inhabitant, ]
residing at Garodia House, ]
M.G. Road, Ghatkopar (East), ]
Mumbai 400 077. ]
4. Neha H. Dharmani ]
Age 46 years, Indian inhabitant, ]
residing at 6/A-4, Basant Park, ]
R.C. Marg, Opp. Chembur Police Station, ]
Chembur, Mumbai 400 071. ]
All the Petitioners are the present and ]
only Trustees of G.S. Garodia Charitable ]
Trust having its office at 149/159-71, ]
Garodia Shopping Centre, Garodia Nagar, ]
Ghatkoper (E), Mumbai 400 072. ] ...Petitioners.
V/s
1. Maharashtra Housing Area & ]
Development Authority, Griha ]
Nirman Bhavan, Bandra (E), ]
Mumbai 400 051. ]
2. State of Maharashtra ]
through the Secretary, Housing ]
Digitally
signed by
Mantralaya, Mumbai. ]
ASHWINI
ASHWINI
H GAJAKOSH
GAJAKOSH Date:
2025.04.23
20:11:13 1/27
+0530
::: Uploaded on - 23/04/2025 ::: Downloaded on - 23/04/2025 22:27:26 :::
apn 201-oswp-1940-1999-J1.doc
3. Vile Parle Kelwani Mandal ]
(Narsi Monji Institute of ]
Management Studies) ] ...Respondents.
Mr. Aspi Chinoy, Senior Advocate, a/w Mr. Karl Tamboly, Mr. Aseem
Naphade, Ms. Kausar Banatwala and Ms. Neuty N. Thakkar, i/by Mr. Tushar
Goradia for the Petitioners.
Mr. Virendra Tulzapurkar, Senior Advocate a/w. Mr. P.G. Lad, a/w Ms.
Aparna Kalathil and Ms. Shreya Shah for Respondent No.1-MHADA.
Ms. Prachi Tatake, Addl. GP, for Respondent No.2-State.
Mr. Girish Godbole, Senior Advocate, a/w Mr. Gaurav Srivastav, Mr. Rahul
Soma, Mr. Shongadgil, Ms. Manorama Mohanty, Ms. Malika Mondal,
Mr. Hitanshu Jain and Mr. S.K. Srivastav, i/by S.K. Srivastav & Co. for
Respondent No.3.
CORAM : A. S. GADKARI AND
KAMAL KHATA, JJ.
RESERVED ON : 30th January, 2025.
PRONOUNCED ON : 23rd April, 2025.
JUDGMENT (Per Kamal Khata, J.):
-
1) By this Petition under Article 226 of the Constitution of India,
the Petitioners seek cancellation of the Order contended in the letter dated
1st July, 1999 whereby Maharashtra Housing and Area Development
Authority ("MHADA')-Respondent No.1 cancelled the allotment of the plot
in favour of the Petitioner-Trust. Additionally, it also seeks cancellation of
Order dated 26th April, 1999 whereby the said plot was allotted to
Respondent No.3.
BRIEF FACTS:
2) The Petitioners are present trustees of a public trust namely
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G.S. Garodia Charitable Trust ('Trust'). The Trust's object is to impart
education and run educational institutions in addition to other charitable
acts for the purpose of benefits to public at large.
2.1) The Trust was allotted plot No.51 reserved for school
admeasuring 6100 sq. mtrs. at Juhu Vile Parle Development Scheme under
the provisions of Regulation No.16 of The Maharashtra Housing and Area
Development (Disposal of Land) Regulations, 1982, pursuant to their
Application dated 28th April, 1992 to the then Hon'ble Minister for Housing,
Maharashtra. The Trust submitted various documents from time to time as
being called upon to furnish by MHADA. By its letter dated 11 th February,
1993 MHADA called upon the Trust to pay Rs.53,91,425/- towards the
premium amount, annual lease rent and other legal charges as more
particularly set out therein. Additionally, the Trust would have to pay cost
of construction of the compound wall and the guarding charges (that would
be communicated). Upon receipt of the premium amount and the
additional costs, MHADA would hand over the possession of the school plot
immediately.
2.2) MHADA acknowledged the receipt of the 25% premium
amount namely, Rs.13,50,000/- from the Trust and thereupon granted their
No Objection to the Trust to prepare and approach the BMC for approval of
the detailed building plans for the construction of the school building. On
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21st March, 1993 MHADA called upon the Trust to pay the balance amount
in respect of the allotment of the school plot. Normally, six months are
granted to make the entire payment which would have ended on 20 th
September 1993. However, on 18 th June, 1993 MHADA informed the Trust
that, the State Government had granted stay against the allotments of the
plot made under Regulation 16 by its letter dated 12 th April, 1993 and
therefore, they should not take any further action in respect of the
allotment of the said plot.
2.3) Upon receiving such a letter, the Trust by its letter dated 28 th
June, 1993 made a representation to then Minister for Housing requesting
him to vacate the stay Order in respect of the school plot as the Trust had
completed all formalities including measurement of land by the City Survey
Office and submissions of all documents to the concerned Authorities for
undertaking construction work of a primary school. That apparently did not
fructify.
2.4) The Petition then states that, in December, 1996, the Trust paid
MHADA the remaining balance amount of Rs.40,41,425/-. MHADA received
the entire amount of Rs.53,91,425/- without any protest or complaint
regarding late payment charges or claims for interest due to late payment.
The Trust contends that upon receiving the entire payment, MHADA was
obligated to handover the possession of the school plot.
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2.5) Only on 27th February, 1997, MHADA for the first time called
upon the Trust to pay interest in the sum of Rs.13,19,949/- on the amount
of Rs.53,91,425/-. The Trust was also informed that, the cost of
construction of the compound wall, fencing and guarding charges if any
incurred by the Executive Engineer, Housing Poisar Division, would be
communicated to them. In response to this communication, the Trust
requested MHADA to waive the interest since it was the charitable
institution and the plot was allotted for setting up an educational
institution. By letters dated 10th March 1997, 24th July 1998, 21st August
1998 and 18th September 1998 repeated requests to waive interest were
made by the Trust.
2.6) MHADA did not pay heed to the Trust's request, called upon
them to pay Rs.16,17,160/- outstanding as on 20th August, 1998. Moreover,
by the letters dated 21st August, 1998 and 18th September, 1998, MHADA
informed the Trust that the allotment may be cancelled if the payment was
not made within eight days .
2.7) On 12th July, 1999 the Trust received a letter dated 1st July,
1999 from MHADA informing them that, the allotment of plot No.51 stood
cancelled on account of non-payment of interest. The letter further stated
that, the Cabinet's sub-committee in its meeting held on 26 th April 1999,
had decided to cancel the plot's allotment to the Trust. Immediately the
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following day, the Trust sent a cheque of Rs.16,17,160/- towards interest
along with its response and requested information from MHADA about the
additional costs. Since there was no response, and in the backdrop of the
facts the Trust filed the present Petition.
3) When the Trust applied for urgent circulation before this Court
it discovered that, the MHADA had already allotted the said plot to
Respondent No.3.
4) Mr. Aspi Chinoy, learned Senior Counsel for the Petitioners
contended that, the action of cancelling the Trust's allotment and granting
the allotment to Respondent No.3 are illegal, arbitrary, unreasonable,
contrary to law, malafide and invalid. According to him, the Trust had not
breached any condition and had complied with all the requisitions including
payment of entire consideration of Rs.53,91,425/- to MHADA.
4.1) He submitted that, in these circumstances, MHADA was not
entitled to cancel the said allotment on any ground whatsoever. In fact,
MHADA was obliged to handover possession upon receipt of the
consideration. There was no provision to levy any interest for late payment
nor a provision for cancellation of the allotment in the event of any default.
According to him even Regulation No.16 of MHAD Disposal of Lands
Regulation, 1982 (under which the plot was allotted to the Trust) did not
provide or authorize MHADA to levy interest for overdue payment or cancel
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the allotment on any ground. Therefore, when the Trust sent the cheque for
interest, on receipt of termination letter for non-payment of interest,
MHADA was obligated to accept the same and revoke the cancellation; that
would have been fair and reasonable action for a public body. MHADA
ought to have kept in mind the Trust's objective as a charitable organization
to start a school.
4.2) He submitted that, the Trust had incurred considerable
expenses for measuring the plot and engaging architects to prepare and
submit plans for construction of the school to BMC. The cancellation of
allotment would therefore cause irreparable loss to the Trust.
4.3) According to him, MHADA's action were pre-planned and
premeditated, indicating malafide intent. The decision to allot the plot to
Respondent No.3 was made even before the Trust's allotment was
cancelled, as evidenced by the sequence of events. The 3 rd Respondent's
application on 16th January, 1999, preceded the cancellation of Trust's
allotment on 12 July, 1999.
4.4) In support of the above contention, he cited a similar case,
where the High Court had reversed MHADA's allotment in favour of M/s
Anchor Foundation by setting aside the cancellation of allotment in favour
of M/s Maulana Azad Memorial Trust for its Urdu School.
4.5) He further submitted that, the Cabinet sub-committee held a
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meeting on 26th April, 1999. With a premeditated intention to cancel the
Trust's allotment, the sub-committee was informed that Respondent No.3
had sought allotment of the said plot and were misinformed about the
Trust's failure to pay the entire amount including a large part of the
principal amount. For this reason, the sub-committee could have derived a
wrong conclusion.
4.6) He strenuously argued that, MHADA had miscalculated the
interest, by including even that period of around nine months, from 19 th
June 1993 to 21st March 1994, during which the State Government had
stayed MHADA's allotment process. Despite being informed about the
miscalculation on account of stay, MHADA completely ignored this aspect.
4.7) Further, each letter claimed a different rate of interest though
the Letter of Allotment did not provide for payment of interest. Then,
though the letters informed that 12.5% would be charged, the Trust was
charged interest at 16%, that too from July 1993 - MHADA ought to have
excluded the stay period of around nine months. Moreover, though MHADA
demanded interest at the rate of 12% for the first time on 21 st November
1996, by which time the entire payment of Rs 50,00,000/- was made, they
charged interest at 16% on Rs. 40,41,425/- from 11 th July, 1993. That too
was wrong as the Trust was required to pay Rs. 40,41,425/- by 21 st April,
1994 as per MHADA's letter dated 21 st March 1994. According to him,
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MHADA could have charged interest only from 21 st April, 1994 when the
stay was lifted by the Government. Thus, the retrospective charge of
interest from 11th July 1993 was entirely baseless.
4.8) Lastly, Mr. Chinoy submits that, MHADA's Order of cancellation
of allotment deserved setting aside even for want of Notice and grant of
hearing to the Trust. Accordingly, the Petition ought to be allowed.
5) Dr. Tulzapurkar learned senior Counsel for MHADA submitted
that, the cancellation of allotment was justified, as was the subsequent
allotment to Respondent No. 3. He highlighted that, the Trust had failed to
pay the balance amount within the stipulated period and had delayed
payments. Despite being granted multiple opportunities, the Trust did not
comply with the payment requirements. He emphasized that MHADA had
shown sufficient leniency and had followed due process before cancelling
the allotment. Additionally, he argued that the Trust had suppressed various
letters and documents that indicated their awareness of the interest liability,
and the payment demands.
5.1) He asserted that, the letter dated 28 th February, 1993 clearly
stated that the Trust was required to pay 25% on the issuance of the Letter
of Allotment and the balance within a period of six months i.e. by August
1993. This letter was suppressed by the Trust in the Petition. Admittedly,
though the balance amount was payable within six months, only in August
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1996 the Trust paid a total amount of Rs.50,00,000/- and undisputedly
there was a balance of Rs.3,91,425/- payable. He submitted that, the letter
dated 21st November, 1996 clearly indicates that, the Trust would have to
pay interest at the rate of 12.5% as per the prevailing policy for the delayed
payment, to which no objection had been raised. Even thereafter multiple
opportunities were granted to the Trust who still failed to make payments.
After receiving the payment of Rs.3,91,425/- on 12 th December, 1996,
MHADA called upon the Trust to pay interest of Rs.13,19,949/-, on 27 th
February 1997, as per the prevailing policy. Despite having shown sufficient
leniency for the payment, the Trust by its letter dated 10 th March, 1997
made a grievance for levy of interest. Having failed to pay the interest
amount for 15 months, MHADA by its letter dated 21 st August, 1998 still
granted a further opportunity and called upon the Trust to pay the sum of
Rs.16,17,160/- within a period of 15 days; failing which the allotment
would be cancelled. The 15 days period expired on 5th September, 1998 and
accordingly MHADA was entitled to cancel the allotment. Despite this
intimation, 13 days after the expiry period, on 18 th September, 1998
MHADA granted the Trust an additional 8 days to pay a sum of
Rs.16,17,160/- in the Office of the Executive Engineer and reiterated that
on failure to act, MHADA will take a decision to cancel the allotment. He
submits that, although an allegation is raised that the document is
fabricated as it does not contain the date of 18 th September 1988, the Trust
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has not challenged this letter.
5.2) Dr. Tulzapurkar submits that, the fact that the Respondent No.3
made an Application for allotment of the land does not, by itself, indicate
any malafide or ill intent. The Respondent No.3 sought the allotment
because they required additional land adjacent to their other educational
institutions. Since this land had been lying vacant for a long duration, a
report regarding the allotment of this land to the Trust and the non-
payment of interest was submitted to the Government for a decision on 18 th
February, 1999. In the Cabinet meeting held on 26 th April 1999 a decision
was made to allot the land to Respondent No.3. After the decision was
communicated to MHADA, MHADA informed Respondent No. 3 about the
Government's decision by its letter dated 17 th June, 1999. On 1 July 1999,
pursuant to the Government's decision MHADA informed the Trust that
their allotment was cancelled due to non-payment of interest amount of
Rs.16,17,160/- within the 15 day period specified in the letter dated 21 st
August, 1998. MHADA also informed the Trust about the decision of the
Cabinet's sub-committee to cancel the allotment to the Trust and asked the
Trust to contact the Executive Engineer to receive the amount paid by the
Trust.
5.3) Dr. Tulzapurkar relied on the affidavit of Mr. Hanmant M.
Dhanure, Executive Engineer of Bandra Division, Mumbai Board dated 18 th
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August 2023 to submit that, the CEO MHADA had an absolute discretion to
grant extension of time for payment of the balance premium upto a period
of 6 months from the date of acceptance of payment and charge interest for
the extended period at the rate of 12% per annum or at such other rate as
may be determined by the Authority from time to time. He submitted that,
sufficient leniency was shown to the Trust in making payments and despite
having been granted several opportunities and demanding payments from
time to time, the Trust had failed to make the payments. He contended that,
the Trust had failed to even seek extension of time from MHADA and had
also failed to comply with the Regulation 9 of MHADA Regulations 1982.
He referred to the statement which showed that the payments were made
by the Trust only in installments. He relied upon the Resolution No.3094
dated 16th November 1992 which entitled MHADA to charge interest at the
rate of 16% per annum. He accordingly submitted that, the cancellation
was absolutely just and could not be faulted in any manner whatsoever. He
drew our attention to Clause 6 of Resolution No.3094 annexed as Exhibit-
'D' to the Affidavit of Mr. Dhanure dated 18th August, 2023. He concluded
by stating that, the Petition deserves to be dismissed.
6) Mr. Godbole, learned senior counsel appearing for Respondent
No.3 adopted the arguments of Dr. Tulzapurkar and also argued and
submitted that, the Petitioners have suppressed material facts and
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documents from the Court. He referred to the judgment in the case of S.P.
Chengalvaraya Naidu (Dead) by Lrs. vs. Jagannath (Dead) By Lrs. & Ors.
reported in (1994) 1 SCC 1 to submit that, one who comes to Court must
come with clean hands and that a person whose case is based on falsehood
has no right to approach the Court and deserves to be summarily thrown
out at any stage of the litigation.
6.1) He submitted that, the fact that the Resolution No.3094 was
dated 16th November, 1992 the Trust would obviously have been aware of
the same and cannot at this belated stage claim ignorance of the prevailing
policy. He submitted that, by its letter dated 19 th November, 1992 MHADA
had informed the Petitioners that, the plot was supposed to be allotted
under Regulation 16 of 1982 Regulations and was subject to the usual
terms and conditions. The Trust had categorically stated that they did not
have any educational institution but their sister Trust P. G. Garodia
Charitable Trust was running a High School at Ghatkopar. He asserted that,
the Trust has suppressed the undertaking given to MHADA whereby the
Trust had undertaken to pay the entire balance amount within a period of 6
months by its undertaking dated 2nd March, 1993.
6.2) He submitted that, the Trust contended that they were not
informed about the vacating of the stay Order before 25 th August, 1993 and
therefore they had not made the payment of the balance amount. However,
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the Trust had admittedly made payments on 19 th July, 1994 and 16th
August, 1994 which belies their contention as it was not possible for them
to make payments if they were not informed. He said that, the Petitioners
have also suppressed the demand letter dated 21 st March, 1994 issued by
MHADA the Trust was called upon to pay the balance Rs.40,41,425/- within
a period of 1 month from the receipt of the letter.
6.3) As a matter of fact, the Trust made a payment of Rs. 7 lakhs
towards the premium to MHADA and requested and had stated that, the
balance amount would be paid shortly as recorded in their letter dated 19 th
July, 1994. Mr. Godbole submits that, the letter dated 13 th November, 1996
which called upon the Trust to pay the remaining amount without any
further loss of time and that they were put to notice that if the payment of
the remaining amount was not made then the matter would be reported to
the higher Officers is also suppressed. The other letter dated 21 st November,
1996 where MHADA called upon the Trust to pay the amount of
Rs.10,41,425/- and interest on account of the delay as per the prevailing
policy of MHADA is also suppressed. In addition to that, they have also
suppressed the letter dated 2nd December, 1996 where the Trust informs
MHADA that they had paid Rs.50,00,000/- and the balance of
Rs.3,91,425/- would be paid shortly and had requested MHADA to bear
with them for some more time. The other letter suppressed, is the letter
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dated 3rd December, 1996 where referring to the letter dated 21 st November,
1996 they had demanded the payment immediately from the Trust. Even
after this letter, the Trust had made payments in 3 installments, the first of
which was paid on 7th December, 1996 in the sum of Rs 2,50,000/- and
second was on 12th December, 1996 whereby Rs.87,500/- was paid and the
third was also on 12 th December, 1996 for Rs.53,925/- that was towards the
premium. He contends that, the Petitioners have not challenged the
demand of interest by MHADA in the Writ Petition and had instead merely
requested for the waiver. Therefore, they cannot now contend that, they
were not aware that interest would have been leviable for delay in
payment. He submitted that, the Petitioners have further suppressed the
interest demand letters dated 21st August, 1998 and 18th September, 1998
issued by MHADA.
6.4) Mr. Godbole submitted that, merely because an allotment
Order is issued, MHADA is not powerless to cancel the same and it cannot
be that the action of cancellation is barred by the principles of estoppel,
especially when the party has committed breach of conditions imposed
under the Regulations. MHADA was therefore within its rights and obliged
to cancel the allotment on account of default by the Trust. He submitted
that, it is evident from the responses that the Trust was required to pay
interest on the demanded amount and have requested to waive the interest
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from MHADA in view of the charitable objects. According to him therefore
the denial of the liability to pay interest is merely an afterthought. He
submitted that, the Trust has merely challenged the Order of cancellation of
allotment dated 1st July 1999 but have not challenged the Regulation 9
under which the interest levy is contemplated. They have also not
challenged the decision of the sub-committee of the Cabinet appointed by
the Government under Regulation 16 dated 26 th April, 1999 whereby it
decided to cancel the allotment in favour of the Petitioners. He submitted
that, in the absence of challenge to the substantive provision under which
interest has been levied, the Trust cannot maintain a Petition for
challenging the final decision of cancellation of allotment. It is not a case
where the terms of allotment have been changed subsequently. The demand
for interest was made on 27 th February, 1997 but the Regulations provided
for levy of interest in the case of delay of making payment and that it was
only after following the process that MHADA has cancelled the allotment in
favour of the Trust on account of the defaults committed by the Trust. He
submitted that, party cannot take advantage of their own wrong. He
submitted that, the Trust cannot contend that they were not made aware of
any interest liability because the Trust has made payment of the premium
amounts after the demand for interest on 21 st November, 1996, on 7th
December, 1996 and on 12th December, 1996 without any objection or
protest regarding the levy of interest. In fact, they have requested for
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waiver of interest. It is submitted that, they have therefore acquiesced to
the levy of interest and now are precluded from objecting to the same.
6.5) He argued that, the Trust did not provide any details or
particulars to support the accusation of mala fides intention in the Petition.
Therefore that accusation should not be considered valid. He submitted
that, the Respondent No.3 have paid the entire amount which was
demanded within the stipulated time and have also secured the allotment
in accordance with law. They have also invested crores of rupees in
furtherance of the allotment and have protected the property from
encroachment for more than a decade. In the aforesaid circumstances, the
Petition should be dismissed, as allowing it would cause grave loss,
prejudice and legal injury to the Respondent No.3, for no fault on their part.
6.6) We have heard Mr. Chinoy, learned Senior Counsel for the
Petitioner, Dr. Tulzapurkar, learned Senior Counsel for MHADA and Mr.
Godbole, learned Senior Counsel for Respondent No.3 and have also
perused the entire record before us.
Reasons and Conclusions:
7) This Petition is regarding the allotment of land by MHADA
under Regulation 16 of MHAD (Disposal of Land) Regulations, 1982 that
empowers MHADA allot plots without the process of tender, advertisement,
public auction etc. For ready reference, Regulation 16 of MHAD (Disposal of
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Land) is reproduced hereinbelow:
"16. Disposal of certain plots under directive from
Government. -
Notwithstanding anything contained in these
Regulations, the plots reserved for amenities or for purely
commercial purposes in any layout prepared by the Authority
in a land situate in any of the nine Urban Agglomerations,
namely, Greater Bombay, Thane, Ulhasnagar, Pune, Kolhapur,
Sangli-Miraj, Solapur, Nashik and Nagpur shall be disposed of
in accordance with the directions of the State Government.
Similarly, the disposal of not more than two per cent, of the
plots reserved for residential use, and to be allotted to
individuals, [or to the co-operative housing societies, whether
proposed or registered]located in such layouts as aforesaid
shall also be done in accordance with the directions of the
State Government.
[Provided that, from out of the plots (other than the 2 per
cent, plots as aforesaid) reserved for residential use and have
not been disposed of, the Authority shall allot or dispose of
any of the plots in accordance with the directions of the State
Government."
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8) Although at the first blush, having heard Mr. Chinoy it
appeared that MHADA's action to cancel the Trust's allotment deserved to
be set aside, having heard the Respondent's counsel and on perusal of the
entire record we find that the Trust has in fact abused its position. The
entire object of MHADA to allot plot for construction of school way back in
1993 has been clearly frustrated. Almost 32 years have passed since the
date of the actual allotment. Even though the entire delay cannot be foisted
on the Trust for thwarting the object of MHADA, atleast the period of five
years delay prior to filing of the Petition are only because of the Trust. They
neither paid the consideration nor constructed the school, for which the
land was allotted.
9) We agree with Dr. Tulzapurkar that the Trust has not come to
the Court with clean hands. It has suppressed both material facts and
documents from this Court. No explanation has been given for not paying
the balance amount of construction within the stipulated time or even after
having being granted multiple opportunities to pay. We find that Trust has
suppressed letters that would evince their obligation to pay MHADA as
demanded by MHADA from time to time as clearly stated in those letters.
Two such letters that have been suppressed are, the letter dated 21 st March,
1994 that required the Trust to pay the balance amount of Rs.40,41,425/-
within a period of one month, i.e., by 21 st April, 1994 and the letter dated
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21st November, 1996 whereby MHADA called upon the Trust to pay the
amount of Rs.10,41,425/- together with interest at the rate of 12.5% for the
delayed period as per the prevailing policy.
10) The Trust has also suppressed the undertaking given by it on
2nd March, 1993 whereby it undertook to pay the entire balance amount
within the period of six months. According to us, these three documents
itself would evince that the Trust had breached the conditions that were
imposed by MHADA. Therefore, Mr. Chinoy's assertion that there was no
breach of condition by the Trust has to be rejected.
11) Mr. Chinoy's next contention regarding not being liable to pay
interest also cannot be sustained. The Trust has contended that MHADA
was not entitled to claim interest at all. That contention is belied by the
Resolution dated 16th November, 1992 and the letter dated 21 st November,
1996 which relied on this Resolution whilst demanding interest from the
Trust.
12) According to us, the Trust was well aware of the Resolution
dated 16th November, 1992 because prior to this Resolution, 50% of the
premium/consideration amount was required to be paid within the first 15
days. Therefore it was well aware or was deemed to have been aware of the
Resolution dated 16th November, 1992 as it had submitted the undertaking
dated 2nd March, 1993 to pay the entire balance amount within a period of
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six months. It would be pertinent to reproduce Regulation 9 of The
Maharashtra Housing and Area Development (Disposal of Land)
Regulations, 1982 which reads as under:
"9. Payment of premium. -
(a) A person, whose tender or offer for grant of a lease
on payment of premium is accepted, shall pay half of such
premium within fifteen days of the acceptance of his offer and
the balance within one month thereafter. The Chief Executive
Officer, may, in his absolute discretion, grant extension of
time for payment of the balance premium upto a maximum of
six months of the date of acceptance on payment of interest
for the extended period at the rate of 12 per cent. per annum
or at such other higher rate as may be determined by the
authority from time to time.
(b) Whenever a lease shall be granted in consideration
of premium, the ground rent shall be payable annually in
advance without any deductions whatsoever, on or before the
10th day of January in each and every year, at the rates to be
determined by the Authority from time to time."
13) It is evident from Clause 6 of the Resolution dated 16 th
November, 1992 that interest would be chargeable at the rate of 16% after
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completion of the six month period. Moreover the Trust has referred to and
relied upon Resolution dated 16 th November, 1992 in its Affidavit dated 4 th
February, 2015. Thus, having taking the benefit of the provision in the
Resolution dated 16th November 1992, the Trust cannot feign ignorance
about the said Resolution. Admittedly, Trust has not challenged the
Regulations more particularly Regulation 9 under which MHADA is entitled
to levy interest.
14) According to us, the Trust has not challenged the levy of
interest, as when it was demanded for the first time on 21 st November,
1996, the Trust had deposited the entire interest amount with MHADA after
it received the termination letter. Furthermore, the Trust has contended in
this Petition that MHADA ought to have accepted the amount and set aside
the cancellation of allotment. Thus we are unable to accept the contention
of Mr. Chinoy that interest was not payable at all.
15) Regarding, the next contention of Mr. Chinoy that MHADA had
no power to cancel the allotment issued in favour of the Trust, we are
unable to accept this proposition. We find that MHADA had granted, not
only sufficient but multiple opportunities to the Trust to make the balance
payment within the stipulated period through various communications. It
was therefore justified in submitting a proposal to the Government for
cancellation of the allotment on account of the Trust's defaults.
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16) We do not find any malafide intent in submitting proposal to
the Government for cancelling the allotment of Trust. The sequence of
events starting with the application of Respondent No.3 for allotment to the
subject land, followed by proposal submitted to the Government to take a
decision and the communication of the decision of the cabinet sub-
committee first to the Respondent No.3 and subsequently to the Trust
cannot itself be a ground to set aside the cancellation of allotment to the
Trust. Admittedly, on the date of cancellation there was an outstanding
amount payable by the Trust. More than five years had lapsed by then, since
MHADA had called upon the Trust to pay the balance amount. Even if we
take into consideration that on 7 th December, 1996, the Trust had paid
Rs.50 lakhs, even then admittedly there was an outstanding amount of
Rs.3,90,425/- payable, apart from interest claimed on 1 st July, 1999, i.e date
of termination of allotment.
17) The allegations of mala fide raised by the Trust are bereft of
any details or particulars. It is merely a presumption. In the facts and
circumstances narrated herein above, we do not find any reason to give any
credence to the same.
18) We do not find the necessity to venture into the assertions and
contentions of Mr. Godbole and the fact that Respondent No.3 has invested
substantial amounts pursuant to the allotment.
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19) In our view, the ratio laid down by the Supreme Court in the
case of S.P. Chengalvaraya Naidu (supra) holding that the Courts of law are
meant for imparting justice between the parties and that one who comes to
Court must come with clean hands. Consequently, the person who's case is
based on falsehood, has no right to approach the Court and can be
summarily thrown out at any stage of the litigation is squarely applicable to
the facts of this case. In our view, the Trust has suppressed material facts
and documents as more particularly stated by Mr. Godbole above.
Therefore, such a party deserves to be thrown out summarily.
20) According to us, the Trust on account of its knowledge of the
Resolution dated 16th November 1992, its conduct has waived its rights to
deny interest payable. According to us the ratio laid down by the Supreme
Court in the case of Galada Power and Telecommunication Limited V/s.
United India Insurance Company Limited and Anr. reported in (2016) 14
SCC 161 is clearly applicable to the facts of this case. The Judgment holds
that, when a party is bound to be fully cognizant of its rights and it
neglected to enforce, it would clearly lead to an inference of its waiver and
its intention abandone its rights. The conduct of the Trust in this case
clearly evinced that although the Trust did not expressly waive its right, it
was implied on account of Trust having asked for waiver of interest through
its communication and consequently having paid it after the allotment was
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terminated. In fact the Petition is based on the ground that the amount paid
by the Trust after the letter of termination ought to have been accepted by
MHADA and the cancellation of allotment ought to have been revoked by it.
21) The mere allegation of the Trust that MHADA has exercised its
powers mala fidely is insufficient. The Supreme Court in First Land
Acquisition Collector and Ors. V/s. Nirodhi Prakash Gangoli and Anr.
reported in (2002) 4 SCC 160 has held that, a mere allegation that power
was exercised mala fide would not be enough and in support of such
allegation specific materials should be placed before the Court. The burden
of establishing mala fides lies heavily on the person who alleges it. Apart
from the bald allegations made in the Petition there is no specific material
placed by the Trust to support such allegations of mala fide.
22) Further, the Supreme Court in the case of Union of India and
Ors. V/s. Ashok Kumar and Ors. reported in (2005) 8 SCC page 760 has
upheld the proposition that to invalidate or nullify any act or Order one
must establish the charge of bad faith, an abuse or a misuse by the
authority of its powers, while the indirect motive or purpose, or bad faith or
personal ill will is not to be held established, except on clear proof thereof.
23) The decision making process by the authority was correct or
not is to be tested by the Wednesbury principle. As held by the Supreme
Court in the case of Union of India and Anr. V/s. G. Ganayutham reported
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in (1997) 7 SCC 463, the Court would have to consider whether the
relevant matters had not been taken into account or whether irrelevant
matters had been taken into account or whether the action was not bona
fide. It also held that the Court will also consider whether the decision was
absurd or perverse. It held that the Court would not however go into the
correctness of the choice made by the administrator amongst the various
alternatives open to him. The Court was also not entitled to substitute its
decision to that of the administrator as per the Wednesbury's test. Thus,
even on this ground, the Trust's contention that the cancellation of the
Trust's allotment was arbitrary deserves to be rejected.
24) MHADA had rightly submitted the proposal in the above
circumstances to the Cabinet's Sub-committee pointing out the relevant
facts and the undisputed delay for payment of consideration by the Trust.
We do not find the actions of MHADA or the sub-committee perverse or
absurd for having cancelled the allotment in the stated circumstances.
25) According to us the contention that, there was no notice or
hearing given to the Trust before cancellation of the allotment also deserves
to be rejected. According to us the principles of natural justice would be
attracted only when termination is on account of a punitive measure or
stigma attached. In the case of State of Uttar Pradesh V/s. Sudhir Kumar
Singh and Ors. reported in (2021) 19 SCC page 706, it was held that
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natural justice is a flexible tool in the hands of judiciary to reach out in fit
cases to remedy injustice. The breach of the audi alteram partem rule
cannot by itself, lead to the conclusion that prejudice is thereby caused.
According to us admittedly there was delay in consideration in payment,
there were multiple opportunities granted to the Trust to make payment
which were admittedly not adhered to resulting in breach. In our view
therefore, this is a clear case where no prejudice as such is caused to the
Trust who has failed to make payment of consideration demanded by
MHADA and therefore the further notice and hearing was not warranted.
26) In view of the above discussion we find that, there are no
merits in the Petition and is accordingly dismissed with no order as to costs.
(KAMAL KHATA, J.) (A.S. GADKARI, J.)
27) At this stage, learned counsel for the Petitioners submitted that,
the interim relief of 'status quo' which is in favour of the Petitioners since
18th November, 1999 be continued for a period of two weeks from today, to
enable the Petitioners to challenge the Order before the Hon'ble Supreme
Court. Learned Advocates for the Respondents opposed the said prayer.
28) However, we deem it appropriate to continue the said interim
relief of 'status quo' for a period of two weeks from today to enable the
Petitioners to impugn the Order before the Hon'ble Supreme Court.
(KAMAL KHATA, J.) (A.S. GADKARI, J.)
