Sarvodaya Coop. Housing Society ... vs Union Of India & Others
2009 Latest Caselaw 2508 Del

R-5
*     IN   THE     HIGH     COURT    OF    DELHI     AT   NEW     DELHI

+     W.P.(C) No. 125/1993


      SARVODAYA COOP. HOUSING SOCIETY LTD. ..... Petitioner
                   Through Mr. K.M.Sharma, advocate.

                   versus

      UOI & ORS.                          ..... Respondents
                          Through Ms.Sangeeta Chandra, advocate.


      CORAM:
      HON'BLE MR. JUSTICE SANJIV KHANNA

                             ORDER

% 07.07.2009

Sarvodaya Cooperative Housing Society Ltd-the petitioner has

challenged the conversion scheme enclosed with the letter dated 14th

February, 1992 issued by Ministry of Urban Development and the

brochure issued by the Delhi Development Authority incorporating and

fixing rates for conversion of leasehold rights in plots into freehold rights

as discriminatory and violates Article 14. It is submitted that the

petitioner-Society cannot be clubbed with other cooperative societies

and accordingly members of the petitioner-Society cannot be asked to

pay conversion charges as are payable by members of other

cooperative societies.

2. Petitioner-Society as per the averments made in the Writ Petition

was registered in 1955 and had purchased 39 acres of land in village

Mahanapur, Munirka. Delhi Administration acquired this land in 1957.

Subsequently, 37 acres of land on leasehold basis was allotted to the

WPC NO.125/1993 Page 1 petitioner-Society in terms of letter dated 2nd May, 1961 issued by

Government of India, Ministry of Home Affairs. It is claimed that the

petitioner-Society had purchased the land which was acquired for

Rs.11.70 lacs approx. and the total compensation received by the

petitioner-Society on account of said land acquisition was merely

Rs.5.64 lacs. It is accordingly submitted that the members of the

petitioner-society should not be charged the same rate for conversion of

the leasehold rights into freehold rights.

3. The petitioner-Society as per the averments in the Petition may

have purchased 39 acres of land in Vill. Mohamadpur, Munirka but the

said land was acquired. Compensation as per the Land Acquisition Act,

1894 was paid to the petitioner. The said acquisition had taken place on

8th March, 1957 by simultaneously issuing notices under Sections 4, 6

and 7 of the Land Acquisition Act. Subsequently, the petitioner-Society

was allotted 37 acres of land on leasehold basis by the Government of

India, Ministry of Home Affairs vide letter dated 2nd May, 1961. As per

the terms and conditions of allotment, members of the

petitioner-Society who were allotted plots were liable to pay ground rent

@ Rs.1.00 per plot for 10 years and thereafter @ 2-1/2% of the premium

of the land already paid. The ground rent was/is subject to revision after

every 30 years. On transfer 50% unearned increase was/is payable to

the lessor. Thus, allotment of land made to the petitioner-Society was on

leasehold basis and subject to payment of lease rent. The said allotment

was accepted by the petitioner-society in 1961. The premium as

demanded was also paid and for the last several years members of

WPC NO.125/1993 Page 2 the petitioner-Society have been paying ground rent without any demur

and protest. Thus members of the petitioner-Society have leasehold

rights in the plots and not freehold rights.

4. Acquisition of land by way of Notification dated 8th March, 1957

issued under Sections 4, 6 and 17 of the Land Acquisition Act, 1894 is a

separate transaction and the petitioner-Society has received

compensation for the same. The consideration paid by the

petitioner-Society for purchasing the land and compensation paid on

acquisition of the said land is a closed issue and cannot be a

determinative, relevant or deciding factor for fixing the conversion

charges payable in respect of the land which was allotted to the

petitioner-Society in 1961 on leasehold basis. The allotment of land on

leasehold basis with a stipulation to pay 50% of the unearned increase

has been accepted by the petitioner-Society and its members for more

than 30 years. The petitioner-Society cannot claim that the right of its

members is superior or better than the rights of members of other

cooperative societies who have been allotted land on leasehold basis.

The petitioner-Society cannot be treated differently and separately from

other societies who have been granted leasehold rights in land.

5. The conversion scheme is universally applicable to all cooperative

societies and their members who have been allotted land on leasehold

basis. The terms and conditions of the lease deed on the basis of which

cooperative societies have been given land are material and in essence

same. All cooperative societies are treated alike because the terms on

which land has been allotted to them are virtually identical.

WPC NO.125/1993 Page 3

6. The identical leasehold rights are being converted into freehold

rights. The contention of the petitioner-Society that in 1957 the land

owned by the petitioner-Society became subject matter of land

acquisition and loss was suffered, is specious and at this distinct point of

time cannot be regarded as good justification and ground to distinguish

the petitioner-Society from others. The petitioner-Society does not form

a separate category or a class which is required to be given a different or

more beneficial treatment. The petitioner-Society was allotted land in

1961 on leasehold basis as in the case of other societies. All such

societies have to be treated at par and uniformly.

7. Conversion policy has been framed by the Ministry of Urban

Development and is being implemented by the DDA. Conversion rates

have been fixed depending upon the area where the land is located.

Upon conversion, leasehold rights get converted into freehold rights and

thereafter there is no need and requirement to pay 50% unearned

increase to the Government/lessor on transfer. Ground rent also ceases

to be payable. Rights of the lessor also cease and obligations of the

lessee or the sub-lessee to the lessor came to an end. What should be

the terms and conditions and the rate of conversion is fixed by the

Government i.e. Ministry of Urban Development. It is not for the Court to

determine and decide the rate of conversion or classify cooperative

societies into categories. Courts have a limited role, and are required to

adjudicate whether while fixing the rates and classifying cooperative

societies as a group, Article 14 of the Constitution has been violated. By

treating cooperative societies uniformly and fixing the rate of land

WPC NO.125/1993 Page 4 depending upon the location, conversion scheme does not violate

Article 14 and cannot be regarded as discriminatory. Courts cannot say

a superior or a better policy or scheme could have been adopted and

applied. It is for the Government to work out the economics as it is

giving up its right to claim 50% unearned increase as well as rights as a

lessor in the plots. In such policy matters unless a clear and palpable

case of discrimination is made out, interference is not warranted.

8. A Single Judge of this Court has upheld the freehold scheme in

Federation of Ashok Vihar Residents Welfare Association versus

Union of India and others 55 (1994) DLT 62. After referring to several

judgments of the Supreme Court on the question of Article 14 and

discrimination, learned Single Judge has reproduced the following

observations of the Supreme Court in the case of State of Gujarat

versus Shri Ambica Mills AIR 1974 SC 1300 :

"A reasonable classification is one which includes all who are similarly situated and none who are not. The question then is: What does the phrase "similarly situated" mean? The answer to the question is that we must look beyond the classification to the purpose of the law. A reasonable classification is one which includes all persons who are similarly situated with respect to the purpose of the law. The purpose of a law may be either the elimination of a public mischief or the achievement of some positive public good. A classification is under-inclusive when all who are included in the class are tainted with the mischief but there are others also tainted whom the classification does not include. In other words, a classification is bad as under-inclusive when a State benefits or burdens persons in a manner that furthers a legitimate purpose but does not confer the same benefit or place the same burden on others who are similarly situated.

A classification is over-inclusive when it includes not only those who are similarly situated with respect to the purpose but others who are not so situated as

WPC NO.125/1993 Page 5 well. In other words, this type of classification imposes a burden upon a wider range of individuals than are included in the class of those attended with mischief at which the law aims. Herod ordering the death of all male children born on a particular day because one of them would some day bring about his downfall employed such a classification."

xxxxxx "The legislation is directed to practical problems, that the economic mechanism is highly sensitive and complex, that many problems are singular and contingent, that laws are not abstract propositions are do not relate to abstract units and are not to be measured by abstract symmetry, that exact wisdom and nice adaptable of remedies cannot be required, that judgment is largely a prophecy based on meager and uninterrupted experience, should stand as reminder that in this area the Court does not take the equal protection requirement in a pedagogic manner."

9. Problem of legislative classification is a perennial one and admits

of no doctrinaire. The rights which the State has as a lessor in the land

allotted to the petitioner-Society and other societies is the same. The

lease deeds in favour of the petitioner-Society have a similar material

stipulations with regard to payment of 50% unearned increase, ground

rent, etc. The State has therefore treated all cooperative societies

similarly.

10. The members of the petitioner-Society always have the option

not to apply for conversion if they are satisfied with the leasehold rights

acquired and retained by them.

11. Learned counsel for the petitioner has relied upon para 12 of the

judgment in the case of Federation of Ashok Vihar Ressidents

Welfare Association (supra). In the said case learned Single Judge of

this Court noticed that in leases which were executed by Ministry of

WPC NO.125/1993 Page 6 Rehabilitation on first transfer, no unearned increase was payable and

unearned increase was payable only on second or subsequent transfers.

Thus the terms of lease issued by Ministry of Rehabilitation were

substantially different from the terms of other lessees where 50%

unearned increase was payable even on first transfer. In these

circumstances, original allottees who were not liable to pay 50%

unearned increase on the first transfer, it was held formed a separate

class and cannot be clubbed with cases where 50% unearned increase

was payable even on the first transfer. Accordingly, directions were

given for providing conversion at reduced conversion fee in such cases.

In the present case, as stated above, the terms and conditions of the

original lease in the case of petitioner-Society and other societies is

material and substantially same. The members of the petitioner-Society

are liable to pay 50% unearned increase as in the case of other

societies. In view of above, I do not find that a case of discrimination

is made out.

Writ Petition has no merit and is dismissed.

SANJIV KHANNA, J.

JULY 07, 2009.

      P




WPC NO.125/1993                                                       Page 7