Raj Kumar Bhutani And Ors. vs Union Of India And Another
2010 Latest Caselaw 5356 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI
18.
+             W.P.(C) 12421/2009 & CM 12856/2009

       RAJ KUMAR BHUTANI AND ORS              ..... Petitioners
                   Through: Mr. Rahul Gupta with
                   Ms. Ira Gupta and
                   Mr. Rajnish Mishra, Advocates.

                       versus

       UNION OF INDIA AND ANOTHER               ..... Respondents
                     Through: Mr. Atul Nanda with
                     Ms. Sugandha, Advocate.

        CORAM: JUSTICE S. MURALIDHAR

                                ORDER

% 25.11.2010

1. The challenge in this petition is to a communication dated 24th June

2009 issued by the Land and Development Office (L&DO), Ministry of

Urban Development, Government of India informing the Petitioner No. 1

that the agreement to sell dated 10th July 2007 executed by the General

Power of Attorney (GPA) on behalf of the lessee of property No. C-73,

Lajpat Nagar-I, New Delhi (hereafter `the property in question') in favour

of both purchasers, i.e., Petitioner Nos. 3 Shri Ankit Bhutani and Mr.

Arpit Bhutani, was not acceptable as it was unregistered.

2. The property in question was originally allotted to Mr. Dewan Chand

by a lease deed dated 29th April 1967 executed by the President of India.

A deed of conveyance of the building constructed on the leasehold site

was also executed on the same date. Mr. Dewan Chand sold the property

to Captain Jaginder Singh Sobti on 8th August 1967. On 24th October

1967 a mutation order was passed in favour of Capt. Sobti by the L&DO.

The MCD also passed a mutation order in his favour on 22nd March 1973.

3. On 1st September 2001 a separate agreement to sell was entered into by

Jagjinder Singh Sobti agreeing to sell the first floor of the suit property to

Petitioner No. 4, Arpit Bhutani, for a sum of Rs. 23 lakhs. Brigadier Sobti

also executed the GPA dated 1st October 2001 in favour of the Petitioner

No. 1 Raj Kumar Bhutani the father of Petitioner No. 3 Ankit Bhutani

and Petitioner No. 2 Ashok Kumar Bhutani father of Petitioner No. 4

Arpit Bhutani jointly in respect of the property in question. A Will was

also executed on 1st October 2001 by Brigadier Sobti declaring

Petitioners 3 and 4 as absolute owners of property in question.

4. A single application dated 30th January 2003 was filed by Raj Kumar

Bhutani for conversion of the property in question from leasehold to

freehold in the joint names of Ankit Bhutani and Arpit Bhutani and

conveyance fee was also deposited.

5. On 18th September 2003 the L&DO wrote to Petitioner No. 1 stating

that in terms of the lease deed the property in question could not be sub-

divided.

6. On 10th July 2007 the Petitioners 1 and 2 as GPA holders on behalf of

Brigadier Sobti executed a modified agreement in favour of Ankit

Bhutani and Arpit Bhutani. It is stated that the modified agreement was

executed on the basis of the earlier agreements executed in 2001 when

the possession had been delivered to the Petitioners and sale

consideration amount was paid to the seller.

7. On 12th November 2007 the L&DO rejected the conversion application

on the ground that the modified agreement dated 10th July 2007 was not

registered. The conversion charges in the sum of Rs. 1,13,625/- was also

refunded.

8. Petitioner No. 1 made a representation against the rejection of the

application for conversion. On 12th February 2008, Petitioner No. 1 again

deposited the conversion charges. On 2nd January 2009 the L&DO again

informed Petitioner No. 1 that the conversion process could not be

completed since the agreement to sell dated 10th July 2007 was not

registered and further that an attested copy of the agreement had not been

filed. A further representation was made on 16th March 2009 by the

Petitioner No. 1 to the L&DO. Reference was also made to the judgment

in S. R. Bhutani v. DDA 2003 (68) DRJ 380 where, in similar

circumstances, such prayer for conversion was allowed.

9. On 24th June 2009 the impugned letter was issued stating as under:

"I am to refer to your letter dated 16.2.2009 on the subject cited above and to regret to say that the Agreement to Sell dated 10.7.2007 which is executed by GPA on behalf of the lessee in favour of both the purchasers for entire property is not acceptable as it is un-registered one. Also the Agreement to Sell dated 23.8.2001 and 1.9.2001 were executed in respect of floor- wise sale which amounts sub-division.

As per lease terms, sub-division is not permissible and hence are not acceptable.

Action for revalidation of cheque for refund of conversion fee is being taken separately."

10. Mr. Rahul Gupta, the learned counsel appearing for the Petitioner

submits that at the time when the original agreements to sell were

executed the Registration and Other Related Laws (Amendment) Act,

2001 (hereafter `the Amendment Act of 2001') had not been enacted

whereby registration of an agreement to sell in respect of immoveable

property became mandatory with 90% of the stamp duty having to be

paid. Consequently, the amended provisions did not apply to the

agreements to sell in the present case. It is submitted that the present case

would stand covered by the judgment of this Court in S.R. Bhutani v.

DDA. It is submitted that the above judgment was affirmed by the

impugned order dated 2nd December 2003 passed by the Division Bench

of this Court dismissing LPA No. 352 of 2003 in DDA v. S.R. Bhutani.

It is submitted that the supplementary agreement dated 10th July 2007

was really not required but was executed by way of abundant caution to

reinforce the fact that the prayer for conversion was being made in the

joint names of Petitioners 3 and 4 with there being no basis for the

apprehension of any sub-division of the property in question.

11. Ms. Sugandha, counsel appearing for the Respondents submits that

the subsequent agreement dated 10th July 2007 whereby the property in

question was agreed to be sold to Petitioners 3 and 4, was required to be

registered in terms of the Amendment Act of 2001 and therefore the

conversion application was rightly rejected.

12. The above submissions have been considered.

13. This Court finds that the basis for the conversion application is in fact

the two agreements executed in 2001 itself and the application was for

conversion of the property in question jointly in the names of Petitioners

3 and 4. It appears that the intention was always that the property should

always be held jointly in the names of Petitioners 3 and 4 and not that the

floors should be separately held by Petitioners 3 or 4.

14. The subsequent agreement dated 10th July 2007 no doubt has been

executed after the Amendment Act of 2001 was enacted. Nevertheless, it

was obviously executed out of abundant caution in view of the objection

raised by the Respondents. Even de hors such agreement, the request for

conversion was only in the joint names of Petitioners 3 and 4 and

therefore, there was no basis for apprehension of any subdivision of the

property in question. As far as the agreements of 2001 are concerned,

they were not required to be registered because they were executed prior

to the coming into force of the Amendment Act of 2001. This Court finds

that the present case is more or less covered by the decision of this Court

in S.R. Bhutani v. DDA which decision has been affirmed by the

Division Bench of this Court.

15. In the circumstances, the writ petition is allowed. The impugned

order dated 24th June 2009 is set aside. A direction is issued to the

Respondents to grant conversion of the property in question in the joint

names of Petitioners 3 and 4 within a period of eight weeks from today

subject of course to the Petitioners complying with all the necessary

formalities.

16. The petition stands allowed in the above terms. Application also

stands disposed of.

S. MURALIDHAR, J.

NOVEMBER 25, 2010 akg