Namgyal Inst. For Research On ... vs Dda & Ors
2008 Latest Caselaw 1711 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI




+     C.M. No. 4138/2008 in Writ Petition (Civil) No. 14645/2006



                                  Reserved on: 11th September, 2008

                           Date of Decision: 23rd September, 2008


NAMGYAL INST. FOR RESEARCH ON LADAKHI ART & CULTURE AND ANR.
               ..... Petitioners

Through: Ms. Shyamala Pappu, Sr. Advocate, with Mr. R. Krishnamoorthy, Advocate.
     Mr. K. Datta, Advocate.


             Versus


      DDA & ORS                                        ..... Respondents
                           Through:       Mr. Rajiv Bansal, Advocate and Mr. Lalit Gupta,
                                         Advocate for applicant in CM No. 4138/2008.


CORAM:
HON'BLE MR. JUSTICE MUKUL MUDGAL
HON'BLE MR. JUSTICE MANMOHAN




1. Whether the Reporters of local papers may be allowed to see the
   judgment?                                    No

2. To be referred to the Reporter or not?            Yes

3. Whether the judgment should be reported in the Digest? Yes
                           ORDER

%                         23.09.2008


: MANMOHAN, J

1. The writ petition has been filed on behalf of Namgyal Institute for Research on Ladakhi Art &

Culture (hereinafter referred as the 'Society') against the respondents praying for quashing of the

letter/order No. 12(33)/83/1L/1051 dated 10.05.2006 issued by the Respondent No.2 (Deputy Director

(IL) DDA) herein directing cancellation of perpetual lease dated 22.11.1995 and praying for further

directions for quashing the proceedings issued by the Respondent No. 3 (Estate Officer, DDA) pursuant

to letter/order dated 24.05.2006 in respect of built up property bearing No. B-25, Qutab Institutional

Area, New Delhi-110 016 (hereinafter referred to as the said property).

2. The present application has been filed for impleadment /intervention by Turner Morrison Land

Ltd. in Writ Petition (Civil) No. 14645-46 of 2006.

3. The brief facts of the case, as per the applicant are as follows:-

(a) The Society was registered on 02.03.1985 to carry on the activities for the promotion of Art,

Culture, Literature and Education.

(b) In order to promote its objective the Society approached DDA for obtaining lease of plot of

land to carry on its activities. Thereafter, perpetual lease deed was executed and registered and

executed on 02.11.1985.

(c) Clause 4 of the lease Deed stipulated that time for commencement and completion of the

proposed building was the essence of the contract.

(d) Due to paucity of funds the society was not in a position to comply with the terms of Clause 4

of the said Lease Deed and the society was unable to even commence the construction of a building on

the said property. In these circumstances, the society approached Turner Morrison Ltd.

(e) In pursuance of negotiations between the parties, a construction agreement dated 11.12.1995

(hereinafter referred as the Construction Agreement) was executed between TML and Petitioner

society.

(f) In terms of the said Construction Agreement, TML agreed and undertook as to costs to

commence and complete construction of a building on the said property by utilizing the maximum

Floor Area Ratio (FAR).

(g) Subsequently, the construction work was duly completed by the applicant company in or about

September, 1999 and the building so constructed by TML has a built up area of 71146 sq.ft. (approx.),

inclusive of 13510 sq. ft. of basement.

(h) However, TML decided to carry on its business of construction through another Company

named Turner Morrison Land Ltd. i.e. the applicant company (hereinafter referred as 'TMLL').

(i) Hence, TML decided to assign its rights and obligations under the said Construction

Agreement dated 11.12.1995 in favour of the applicant herein i.e. TMLL and this intention was duly

communicated to society vide letter dated 04.03.1996 and the society vide its letter dated 28.03.1996, duly gave its no objection in this behalf.

(j) Thereafter, by a Deed of Assignment dated 02.08.1996, all rights and obligations of TML

under the said construction agreement dated 11.12.1995 were assigned in favour of TMLL with the

knowledge and consent of the society. The society was also a signatory to the said Deed of

Assignment.

(k) The Petitioner society has not been able to clear its dues payable to the applicant company.

Apart from incurring huge expenses running into crores of rupees, the applicant company has also

entrusted security deposit of Rs. 3 crores to the petitioner society.

(l) On account of the failure of the society to repay the construction cost to the applicant company,

the present application has been filed.

4. The Clauses of the said Construction Agreement 2, 3.1, 3.2 and 4 executed between the first party, Namgyal Institute for Research on Ladakhi Art and Culture and the Second Party, Turner Morrison Ltd., dated 11th December, 1995 are reproduced below:

"2. It will be the obligation of the Second Party to do the following:

(a) To appoint Architect, Engineer, Sub-contractor for commencing the construction on the said plot.

(b) To prepare the plan for construction of a building/buildings on the said plot utilizing the maximum FAR permissible and get the same signed by the First Party and obtain necessary approvals from all relevant authority and authorities for construction of the building on the said plot of land.

(c) To commence and complete construction on the said plot utilizing the maximum FAR and consisting of Basement floors and other floors.

3.1 It will be obligation of the First Party to do the following:

(a) To cooperate with the Second Party for obtaining all necessary approvals and permissions and for that purpose to sign all applications, affidavits as may be required from time to time including the plans, revised building plan and all documents and papers for commencing the construction, completing the construction and for obtaining "C" form and "D" form and completion certificate.

(b) To pay the construction cost to the Second Party at the rate of Rs.1, 200/- per sq. ft. to the Contractor which the First Party shall pay to the Contractor in stages depending upon the progress of the work.

(c) The First Party further agrees and undertakes to sign all necessary papers and documents as may be required by the Second Party from time to time to enable the Second Party to commence and complete the construction.

3.2 (a) It will be the obligation of the First Party to make payments to the Contractor in accordance with the Schedule of payment annexed hereto and in the event delay in any payment, the First Party shall pay interest @ 36% per annum on the delayed payment.

(b) That till the entire construction cost is paid by the First Party to the Second Party, the Second Party shall have a lien over the said land along with constructions thereon and in that event shall have full authority and power to appropriate all its construction cost, interest and expenses by safe, transfer or lease of such constructed area so as to meet the outstanding liabilities of the First Party and in that event the First Party shall not raise any objection in any manner whatsoever.

(c) That further to secure the payments to be made to the Second Party the First Party shall deposit the original title deeds of the said property with the Second Party who shall retain the same as a security till the entire payment and entire construction cost and all the dues and expenses payable by the First Party to the Second Party is paid fully.

4. The construction shall be completed by the Second party within a period of 24 months from the date of sanction of the building plan by the relevant authority or within such extended period as may be agreed upon between the parties. (emphasis supplied)"

5. The relevant Clause 3.2 sub-clause b of the aforesaid Construction Agreement as well as the

Resolution of the Governing Body dated 25.09.1995 clearly stipulates that till the entire agreed

construction costs are paid by the Society to the contractor, a lien over the said property alongwith all

constructions thereon was created in favour of TML and TML was granted unfettered rights to recover

any outstanding construction cost, interest and expenses inter-alia by sale, transfer or lease of the

constructed area. The society was not entitled to raise any objection to such utilization of the said

building by TML. Further, in terms of Clause 3.2 (C) above, the society was also to deposit the

original title deed of the said property with the TML. Therefore, it is seen that TML has substantial

and valuable interest in the said property which formed the subject matter of the writ petition as can

also be noted from the abovementioned Construction Agreement and the Resolution of the Governing

Body of the Society.

6. It is also pertinent to note that TML decided to carry on its business of construction through

another Company TMLL i.e. the applicant Company. The Rights and Obligations of TML under the

said Construction Agreement were assigned in favour of the applicant i.e. TMLL under the Deed of Assignment dated 02.08.1996 with the knowledge and consent of the Society and the Society was also

signatory to the said Deed of Agreement. Therefore, the interest in favour of TML was assigned in

favour of the applicant company in the said property.

7. The learned Senior counsel for the petitioner, Ms. Shyamala Pappu contended that the said

TML have forged and fabricated documents purported to be executed by the officer bearers of the

petitioner. However, since the initial agreement has not been denied, therefore, we are of the opinion

that the applicant is a necessary and proper party.

8. In view of the above observations, the applicant Company is permitted to be impleaded as a

party in this writ petition and allowed to participate in the writ proceedings.

9. Mr. K. Datta, Advocate, contended that he has been appearing for the petitioner in Writ

Petition(C) No. 17210/2006. However, Mr. R. Krishnamoorthy, Advocate, contends that he is now

appearing for the petitioner. But we find that Mr. K. Datta has not been given a discharge by the

petitioner. Therefore, we direct the petitioner to be present in the court for further directions on 4 th

November, 2008.

                                                      MANMOHAN, J




SEPTEMBER 23rd , 2008                                  MUKUL MUDGAL, J
s/dr