Supreme Cooperative Group ... vs Delhi Development Authority
2009 Latest Caselaw 1746 Del

R-11
*IN THE HIGH COURT OF DELHI AT NEW DELHI
+    W.P.(C) 5616/1997

     SUPREME COOPERATIVE GROUP
     HOUSING SOCIETY LTD.               ..... Petitioner
                   Through Mr. Ajit Pudussery, advocate.

                   versus
     DDA                 ..... Respondent
                        Through Ms.Sangeeta Chandra, advocate.
     CORAM:
     HON'BLE MR. JUSTICE SANJIV KHANNA
                     ORDER

% 29.04.2009

1. Petitioner, Supreme Cooperative Group Housing Society Ltd. has filed the present Writ Petition against DDA with several prayers. The prayer with regard to the issue of C and D forms was considered and decided by Order dated 25th March, 2009 passed by Hima Kohli, J. For the sake of convenience the Order is reproduced below:-

"The present writ petition is filed by the petitioners praying inter alia for quashing the orders dated 18.3.1996, 19.6.1996 and 25.4.1997 issued by the respondent/DDA demanding composition fee from the petitioners. The second relief sought by the petitioners is for directing the respondent/DDA to grant to the petitioner society approval to Forms C & D under bye-law 7.2.4 of the Building Bye-Laws 1983 and also to grant requisite occupancy certificate to the petitioners.

The third relief sought by the petitioners is for quashing the letter dated 27.3.1996 issued by the respondent/DDA holding that the draw of lots held by the petitioner society was unauthorized. The last relief sought in the writ petition is against the

WPC NO.5611/1997 Page 1 respondent/MCD for directions to supply water and sewer connections to the flats of the petitioner society.

Counsel for the petitioner/society submits at the outset, that sewer connection has already been granted by the MCD, hence the said relief is not being pressed.

In so far as the third relief is concerned, counsel for the respondent/DDA states that the relief in the aforesaid prayer is interlinked with the relief as sought in prayers (a) and (b).

As far as the relief sought by the petitioners in prayer (b) is concerned, whereunder a mandamus is sought to the respondent/DDA to grant the petitioner society approval to Forms C & D under the Building Bye-laws 1983 and to grant the requisite occupancy certificate is concerned, counsel for the petitioner society states that the society had applied for Forms C & D with the respondent/DDA on 21.6.1990, with the requisite processing fee of Rs.200/-, but the same was wrongly rejected on the ground of incomplete work at the site. He submits that that the petitioner society had in fact requested the respondent/DDA to issue Form C in respect of the partly constructed 215 flats and thus the rejection order of the respondent/DDA is illegal. On the last date of hearing, counsel for the respondent/DDA was directed to produce the relevant records, which have been duly produced. A perusal of Form C submitted by the petitioner society to the respondent/DDA, dated 21.6.1990 shows that an application was made on behalf of the society for the entire plot and not merely for the partly built up plot, as alleged by the counsel for the petitioner. Hence, the rejection order issued by the respondent/DDA on the ground of "incomplete work" cannot be faulted.

In so far as the second application dated 12.12.1990, filed by the petitioner society with the WPC NO.5611/1997 Page 2 respondent, for issuance of Forms C & D for part project is concerned, a perusal of the application in the original records as produced by the respondent/DDA, shows that no processing fee was deposited by the petitioner society. This fact is also borne out by the noting file of the respondent/DDA, particularly the note at pages 82-83 of the file. In these circumstances, the contention raised on behalf of the petitioner society that the respondent/DDA ought to have considered the issuance of Forms C & D to the petitioner society for part project is not sustainable, as the form submitted to DDA was incomplete.

A query has been posed to the counsel for the petitioner society as to whether thereafter, the society has applied to the competent authority for approval of Forms C & D, particularly since counsel for the respondent/DDA had stated, on an earlier date, that the area in question has been transferred to the respondent/MCD w.e.f. 1991, to which the reply is in the negative. In this regard, counsel for the petitoner draws the attention of this Court to the letter dated 25.4.1997 issued by the respondent/DDA to the petitioner society.

In view of the above, the prayer (b) of the writ petition cannot be granted to the petitioner society, as the petitioner society has not submitted any application, complete in all respects, along with the processing fee to the respondent/DDA for approval of Forms C & D and the question of issuance of an occupancy certificate would arise only after approval of Forms C & D.

Counsel for the petitioner society states that in view of a pending dispute between the petitioner society and the contractor/architect, the formality of completing of Forms C & D for obtaining an occupancy certificate cannot be completed. In this regard, he draws the attention of this Court to the order dated 9.5.1996 passed by the Supreme WPC NO.5611/1997 Page 3 Court in SLP No.10772/96, entitled "Supreme Co- operative Group Housing Society Vs. MCD", to state that the said fact was noticed by the Supreme Court in the aforesaid SLP and thereafter, directions were issued to the respondent/DESU therein to give permanent connections to the petitioner society after inspecting the premises of the petitioner society. In the present case, submission of Forms C & D, complete in all respects, is a pre-requisite. It is not denied by the counsel for the petitioner society that the same need not be submitted only through a contractor/architect. Hence it was and is still always open to the petitioner/society to apply to the respondents for obtaining Forms C & D, as per the applicable Building Bye-Laws.

This leaves the issue with regard to the composition fee levied by the respondent/DDA. Perusal of the impugned demand letter dated 18.3.1996 raised by the respondent/DDA on the petitioner society shows that the below mentioned amounts have been demanded:

1.Extension of time for the construction of a Building can be allowed upto 2.5.96 on payment of composition fee Rs.44,51,700/-

2.Penalty for execution of Lease Deed Rs. Nil.

3. Ground Rent for the period upto 14.7.96 Rs. 27,823/-

4.Any other dues/Interest on ground rent for belated period Rs. 1,18,720.50

5.Construction of one less dwelling unit Rs. 76,825.55

--------------------------

Total : Rs.46,75,069.05

----------------------------

Counsel for the petitioner society states that the demands raised against Items No. 3 to 5 do WPC NO.5611/1997 Page 4 not survive as the ground rent and the interest thereon, have been duly paid to the respondent, and "one less dwelling unit" mentioned at Serial No. 5 has since been constructed.

Counsel for the respondent/DDA seeks time to obtain necessary instructions from her client in this regard.

At the request of the parties, this case shall not be taken up till 27.3.2009."

2. I have heard learned counsel for the petitioner and the respondent-DDA on the question of composition fee, ground rent and interest due thereon and construction of one less dwelling unit.

3. It is admitted that ground rent and on failure to pay the same, interest has to be paid. Thus liability to pay ground rent and interest cannot be denied. It is agreed by the learned counsel for the petitioner-Society that they shall pay ground rent as well as interest as per the policy of DDA for delay in payment of ground rent. DDA will send a letter to the petitioner-Society enclosing therewith a chart giving details of ground rent and interest due and payable from the date the plot was allotted till today. The petitioner will pay ground rent along with interest within one month from the date demand is received. In case there is any error or mistake in the calculation, the petitioner-Society will respond along with documentary proof of payment within 15 days of the receipt of the said notice.

4. On the question of construction of one less dwelling unit,

learned counsel for the petitioner states that 300 dwelling units were

required to be constructed on the plot of 5 acres allotted to the

WPC NO.5611/1997 Page 5 petitioner-Society and in fact 300 dwelling units have been

constructed. Learned counsel for the respondent-DDA very fairly

states that DDA will carry out inspection and in case the aforesaid

statement is found to be correct, the petitioner-Society will not be

called upon to pay Rs.76,825.55 for construction of one less dwelling

unit. However, in case the petitioner has constructed 299 flats the

said charges will be payable. Learned counsel for the petitioner

agrees to the said statement made by learned counsel for the

respondent-DDA. DDA will carry out inspection after giving notice to

the petitioner-Society.

5. The last issue pertains to composition fee payable for delayed

construction. Clause II(4) of the perpetual Lease Deed reads as

under:-

"(4) The Lessee shall within a period of two years (or such period as may be fixed by the Lessor) from the 3rd day of May one thousand nine hundred and eighty three (and the time so specified shall be the essence of the contract) after obtaining sanction to the building plan with necessary design, plans and specifications and architectural controls from the Authority, proper Municipal or other authority at his own expense, erect upon the residential plot and complete in a substantial and workmanlike manner a Group Housing Complex with not less than 60 dwelling units to an acre for private dwelling of its members with the requisite and proper walls, sewers and drains and other conveniences in accordance with the WPC NO.5611/1997 Page 6 sanctioned building plans to the satisfaction of the Authority and then from the proper municipal or other authority." ( emphasis supplied).

6. Composition fee is payable in terms of Clause III r/w proviso

thereto which reads as under:-

"III. If the sum or sums payable towards the premium or the yearly rent hereby reserved or any part thereof shall at any time be in arrear and unpaid for one calendar month next after any of the days whereon the same shall have become due, whether the same shall have been demanded or not, or if it is discovered that this lease or any conveyance deed has been obtained by suppression of any fact or by any mis-statement, mis-representation or fraud or if there shall have been in the opinion of the Lessor, whose decision shall be final, any breach by the Lessee or by any person claiming through or under it of any of the covenants or conditions herein contained and on its part to be observed or performed, then and in any such case, it shall be lawful for the Lessor, notwithstanding the waiver of any previous cause or right of re-entry upon the plot hereby demised and the building thereon to re-enter upon and take possession of plot or any of the sub-leased plots and the buildings and fixtures thereon in respect of which any sum or rent has been in arrear, or such suppression, mis- statement, mis-representation or fraud or breach has been committed and thereupon this demise and everything herein contained shall cease and determine in respect of the plot so re-entered upon and the Lessee and the allottee(s) shall not be entitled to any compensation whatsoever, nor to the return of any premium paid.

PROVIDED that, notwithstanding anything contained herein to the contrary, the Lessor may without prejudice to his right of re-entry as aforesaid, and in his absolute discretion, waive or condone breaches, WPC NO.5611/1997 Page 7 temporarily or otherwise, on receipt of such amount and on such terms and conditions as may be determined by him and may also accept the payment of the said sum or sums or the rent which shall be in arrear as aforesaid together with interest at the rate of six per cent per annum." (emphasis supplied)

7. It is an admitted case of the parties that respondent-DDA has not cancelled the lease in the present case for late construction and has demanded composition fee in terms of Clause III.

8. A bare reading of Clause II(4) of the Lease Deed shows that

the petitioner-Society was to construct a building consisting of not

less than 300 dwelling units (60 dwelling units per acre x 5 acres)

within two years. The said Clause also stipulates that the dwelling

units should be "complete in a substantial and work like manner ...

for private dwelling of its members with the requisite and proper

walls, sewers and drains and other conveniences." The short

question involved is when 300 flats were constructed/completed so

as to be covered by the said Clause.

9. In the counter affidavit, DDA has stated that the petitioner-

Society had applied for Form C on 21st June, 1990. However, the said

Form C was rejected as it was found that the sewer lines were

incomplete. It is, therefore, clear that as on 1st June, 1990 the 300

dwelling units were not complete in a substantial and work like

WPC NO.5611/1997 Page 8 manner with proper walls, sewer lines and drains.

10. Respondent-DDA admits that the petitioner-Society applied for

Forms C and D on 12th December, 1990 in respect of 215 flats. It is

stated in the application that remaining 85 flats were under

construction in the fourth tower and the construction was likely to

take some more time. The respondent-DDA was requested to issue

Forms C and D in respect of 215 flats to enable the members to shift

in their flats. It is clear from the said application that the petitioner

had not completed construction of 300 flats on 12th December, 1990

and therefore requirement of Clause II(4) was not satisfied on the

said date.

11. Learned counsel for the respondent-DDA submitted that the

petitioner has thereafter not applied for Forms C and D and had

straightaway applied for completion certificate on 15th April, 1993. It

was stated in this application that 215 flats were constructed in the

first phase and were allotted to its members on 13th April, 1990 and

the construction of the remaining flats was completed on 17th July,

1992. DDA, however, did not entertain the said application and vide

their letter dated 25th June, 1993 informed the petitioner that the

request for completion certificate cannot be accepted without the

WPC NO.5611/1997 Page 9 petitioner first obtaining approval of Forms C and D. It appears that

the matter has lingered on since then with the petitioner-Society

applying for Forms C and D and completion certificate and with the

DDA insisting on payment for late construction fee or composition fee

before the application of the petitioner for Forms C and D can be

considered. Reference in this regard can be made to letter dated 25th

April, 1997 written by the respondent-DDA to the petitioner-Society

in which it is stated as under:

1. "With reference to your letter no. nil dated 27/2,3/97 on the subject cited above, I am directed to inform you that as per or guide-lines, composition fee is leviable till the date of issue of `D` form by the Bldg. Branch of D.D.A. Since you are yet to submit a copy of the same, Composition fee continues to be charged from you.

2. The composition fee has therefore been demanded strictly in accordance with the policy and guide-lines of D.D.A.

3. In view of above, you are again requested to pay the demanded amount of composition fee and approach our Building Deptt. to obtain form `D` so that levy of composition fee may be stopped."

12. The facts of the present case are rather peculiar and unusual.

DDA claims that the petitioner should pay composition fee before

issue of Forms C and D can be examined and composition fee is

WPC NO.5611/1997 Page 10 payable till Forms C and D are issued. The petitioner, on the other

hand, submits that composition fee is payable till the date 300 flats

were not complete for occupation but not thereafter. It is admitted

that even today, Forms C and D have not been issued though

admittedly the building is complete and even occupied and lived in

for last nearly 25 years.

13. Learned counsel for the petitioner has drawn my attention to

the Circular issued by the Government of India, Ministry of Urban

Affairs vide letter no.J-20011/12/77-LII dated 21st January, 1994 to

deal with cases where no Form D or occupancy certificate has been

obtained or are not traceable. In respect of these cases, the said

Circular states as under:

"Ascertainment of Date of Construction when D Form/Occupancy Certificate not Obtained/not Traceable.

Under Secretary to the Govt. of India, Ministry of Urban Affairs and Employment vide letter No.J- 20011/12/77-LII dated 21.1.1994 conveyed the decision of the Govt. of India that in respect of conversion cases of lease hold rights into free-hold rights, in the absence of form „D‟ or completion certificate other documentary evidences, such as, House Tax assessment notice, certificate of exemption from property tax etc. can also be accepted.

Considering the above decision of the Govt. of India, LG, Delhi vide his orders dated 28.8.1996 has ordered that in these conversion cases where either WPC NO.5611/1997 Page 11 the lessee/allottees have not obtained form „D‟/occupancy Certificate or the same is reportedly not traceable, the actual date of construction shall be determined on the basis of :

(i) House Tax assessment order certifying the effective date of Property Tax.

(ii) Letter from DESU for permanent connection of electricity.

LG, Delhi has also approved that simultaneously a letter shall be sent to the Building Department, DDA/MCD, as the case may be, informing them that the conversion application has been processed in the absence of form „D‟ or Occupancy Certificate and, therefore, they may ensure that the building constructed on the plot is in accordance with the sanctioned plan."

14. As per the above Circular, where Form D or occupancy

certificate has not been obtained or is not traceable the actual date

of construction can be determined on the basis of the house tax

assessment order certifying the effective date of property tax. The

petitioner has filed on record the initial assessment orders passed by

the House Tax Department, MCD. As per the Assessment Order

dated 27th November, 1996, 215 flats were constructed and property

tax was payable thereon w.e.f. 1st April, 1991. As already stated

above, the said date is not relevant because the petitioner-Society

had to complete 300 flats substantially and in a work like manner. As

per another Assessment Order dated 27th November, 1996 the

balance 85 flats were completed and were assessable to house tax WPC NO.5611/1997 Page 12 w.e.f. 1st April, 1993. Normally, assessees to avoid incidence/charge

of property tax like to give a belated date of construction as property

tax is leviable only on a constructed building and not on an

incomplete building. Thus as per the aforesaid Assessment Order

300 flats were complete in a substantial and in a work like manner

w.e.f. 1st April, 1993. I feel the said date should be treated as the

date on which the petitioner had complied with Clause II(4) of the

Lease Deed. The petitioner-Society will be, therefore, liable to pay

composition fee upto 31st March, 1993.

15. Learned counsel for the respondent-DDA submits that as per

the policy of DDA, the date on which Form D is issued is treated as

the date for completion of construction and cessation of liability to

pay composition fee. This is a matter of convenience for DDA in the

absence of requisite documents and information. Building Bye Laws

1983 may require issue of Forms C and D, before the building is

occupied, however, Clause II(4) imposes no such obligation and

does not prescribe any such requirement. Clause II(4) of the Lease

Deed requires the lessee to complete the construction in a substantial

and in a work like manner with proper walls, sewer lines and drains

and other conveniences. Penalty is charged for failure to construct

WPC NO.5611/1997 Page 13 building/flats in terms of the said clause and not for failure to obtain

forms C and D. Clause II(4) quoted above does not make reference

to Building Bye Laws 1983 or Forms C and D. It specifically refers to

completion of the requisite dwelling units in a substantial and work

like manner with proper walls, sewer and drains and other

conveniences. It is not denied by the respondent-DDA that members

of the petitioner-Society and other transferees are in occupation of

the flats for the last several years and are using the same.

16. In these circumstances, it is not possible to accept the plea of

the respondent-DDA that the petitioner-Society will be liable to pay

composition fee till today or till the time Forms C and D are not

issued. Accordingly, it is directed that respondent-DDA is entitled to

charge composition fee upto 31st March, 1993. DDA will compute the

said composition fee and issue letter of demand within four weeks.

The petitioner-Society will make payment of the said demand within

eight weeks thereafter along with interest @ 6% p.a. as stipulated in

Clause III..

Writ Petition is accordingly disposed of. DASTI.

SANJIV KHANNA, J.

APRIL      29, 2009
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WPC NO.5611/1997
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