Delhi High Court
Vijay Jain vs Govt. Of Nct Of Delhi & Ors. on 25 April, 2011
Author: S. Muralidhar
IN THE HIGH COURT OF DELHI AT NEW DELHI
W. P. (C) 12292/2009 & CM Nos. 12623/2009 & 12452/2010
Reserved on: April 20, 2011
Date of decision: April 25, 2011
VIJAY JAIN ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and
Mr. Ajay Shekhar, Advocates.
versus
THE HON'BLE LT. GOVERNOR,
GOVERNMENT OF NCT OF DELHI & ORS ..... Respondents
Through: Mr. MP Singh, Advocate for UoI
Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 12226/2009 & CM No. 12506/2009
ANIL KUMAR JAIN ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HONBLE LT GOVERNOR
OF NCT OF DELHI AND ORS ..... Respondents
Through: Mr. Sachin Datta, CGSC with
Ms. Gayatri Verma, Advocates
for UOI.
Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 12287/2009 & CM Nos. 12614/2009 & 12450/2010
BASANT KUMAR SOMANI ..... Petitioner
Through: Mr. Sanjiv Bahl with Mr.
Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
W.P. (C) 12292/2009 & batch Page 1 of 19
versus
THE HONBLE LT. GOVERNOR GOVT. OF
NCT OF DELHI AND ORS ..... Respondents
Through: Mr. MP Singh, Advocate for UoI
Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 12288/2009 & CMs. 12616/2009 & 12454/2010
VIRMATI ..... Petitioner
Through: Mr. Sanjiv Bahl with Mr.
Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT GOVERNOR , GOVT OF
NCT DELHI & ORS ..... Respondents
Through: Mr. MP Singh, Advocate for UoI
Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 12301/2009 & CM Nos. 12627/2009 & 12459/2010
SUNITA GUPTA ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT GOVERNOR ,
GOVT. OF NCT OF DELHI & ORS ..... Respondents
Through: Mr. MP Singh, Advocate for UoI
Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 12302/2009 & CM Nos. 12630/2009 & 12449/2010
KRISHAN KUMAR ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
W.P. (C) 12292/2009 & batch Page 2 of 19
versus
THE HONBLE LT. GOVERNOR
GOVT. OF NCT OF DELHI AND ORS ..... Respondents
Through: Mr. MP Singh, Advocate for UoI
Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 12308/2009 & CM No. 12654/2009
MANOJ VIJ & ANR ..... Petitioners
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT GOVERNOR,
GOVT. OF NCT OF DELHI & ORS ..... Respondents
Through: Mr. MP Singh, Advocate for UoI
Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 12309/2009 & CM Nos. 12656/2009 & 12457/2010
RITU JAIN ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HONBLE LT.GOVERNOR
GOVT. OF NCT OF DELHI AND ORS ..... Respondents
Through: Ms. Zubeda Begum, Addl.
Standing Counsel with Ms. Sana
Ansari, Advocate for GNCTD.
Ms. Renuka Arora, Advocate for
DSIIDC.
Mr. Sachin Datta, CGSC with
Ms. Gayatri Verma, Advocates
for UOI.
W.P. (C) 12292/2009 & batch Page 3 of 19
W. P. (C) 12333/2009 & CM Nos. 12683/2009 & 12456/2010
BALA DEVI ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT GOVERNOR GOVT OF
NCT DELHI & ORS ..... Respondents
Through: Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 14062/2009 & CM Nos. 16139/2009 & 12455/2010
DEEPAK GUPTA ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT GOVERNOR
GOVT. OF NCT OF DELHI AND ORS ..... Respondents
Through: Ms. Zubeda Begum, Addl.
Standing Counsel with Ms. Sana
Ansari, Advocate for GNCTD.
Ms. Renuka Arora, Advocate for
DSIIDC.
Ms. Sonia Sharma with
Mr. Mirza Aslam Beg,
Advocates for UOI.
W. P. (C) 14065/2009 & CM Nos. 16146/2009 & 12448/2010
VINOD KUMAR JAIN ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT GOVERNOR GOVERNMENT
OF NCT OF DELHI AND ORS ..... Respondents
W.P. (C) 12292/2009 & batch Page 4 of 19
Through: Ms. Zubeda Begum, Addl.
Standing Counsel with Ms. Sana
Ansari, Advocate for GNCTD.
Ms. Renuka Arora, Advocate for
DSIIDC.
Ms. Sonia Sharma with Mr.
Mirza Aslam Beg, Advocates
for UOI.
W. P. (C) 14066/2009 & CM Nos. 16148/2009 & 12460/2010
MANJU GARG ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT GOVERNOR
GOVT. OF NCT OF DELHI AND ORS ..... Respondents
Through: Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 14067/2009 & CM Nos. 16150/2009 & 12458/2010
RAM KUMAR JAIN ..... Petitioner
Through: Mr. Sanjiv Bahl with Mr.
Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT GOVERNOR
GOVT. OF NCT OF DELHI AND ORS ..... Respondents
Through: Ms. Zubeda Begum, Addl.
Standing Counsel with Ms. Sana
Ansari, Advocate for GNCTD.
Ms. Renuka Arora, Advocate for
DSIIDC.
W. P. (C) 755/2010 & CM Nos. 1576/2010 & 12453/2010
TILKA DEVI ..... Petitioner
Through: Mr. Sanjiv Bahl with
W.P. (C) 12292/2009 & batch Page 5 of 19
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
LTGOVERNOR GNCT OF DELHI AND ORS ..... Respondents
Through: Mr. Rajiv Nanda, Addl. Standing
Counsel with Ms. Rachna
Saxena, Advocate for
R-1 and R-2.
Ms. Renuka Arora, Advocate for
DSIIDC.
Mr. H.C. Bhatia, Adv for UoI
W. P. (C) 757/2010 & CM Nos. 1588 & 12451 of 2010
MANEESH JAIN ..... Petitioner
Through: Mr. Sanjiv Bahl with
Mr. Eklavya Bahl and Mr. Ajay
Shekhar, Advocates.
versus
THE HON'BLE LT.GOVERNOR GOVERNMENT
OF NCT OF DELHI & ORS. ..... Respondents
Through: Mr. Rajiv Nanda, Addl. Standing
Counsel with Ms. Rachna
Saxena, Advocate for
R-1 and R-2.
Ms. Renuka Arora, Advocate for
DSIIDC.
Ms. Sonia Sharma with Mr.
Mirza Aslam Beg, Advocates
for UOI.
CORAM: JUSTICE S. MURALIDHAR
1. Whether 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 Digest? Yes
W.P. (C) 12292/2009 & batch Page 6 of 19
JUDGMENT
25.04.2011
1. The common challenge in all these petitions is to a Circular dated
10th July 2008 issued by the Commissioner of Industries ('COI') fixing
the rates of conversion of industrial plots in Narela Industrial Area from
leasehold to freehold at Rs. 19,800/- per sq. m. for the year 2007-08.
The further prayer of the Petitioners is that a direction should be issued
to the COI to process the pending applications of the Petitioners for
conversion @ Rs. 7,500/- per sq. m. or in the alternative to charge Rs.
9,900/- per sq. m. as per the circular of the DDA @ for the year 2007-
08. The third prayer is for a direction to the Respondents not to charge
composition charges on account of non-execution of lease deeds and
delayed construction in terms of the decision taken in the meetings
dated 6th July 2006 and 22nd August 2007 of the Committee constituted
for the purpose, comprising of the representatives of the Government of
National Capital Territory of Delhi ('GNCTD') (Respondent No. 1),
the COI ( Respondent No. 2) and the Delhi State Infrastructure &
Industrial Development Corporation Limited ('DSIIDC') (Respondent
No. 3).
2. When notices were issued in these petitions on 26th October 2009,
this Court granted the Petitioners liberty to deposit the entire amount
demanded by the DSIIDC in terms of the impugned Circular dated 10 th
July 2008 of the COI within four weeks. It was directed that the
aforementioned deposit would be subject to the outcome of the present
writ petitions. However, it is directed that Respondents would not be
entitled to claim any amount towards non-execution of the lease deed
or composition fee towards late construction contrary to the minutes of
the meeting dated 22nd July 2007. It was further clarified that the
DSIIDC would be entitled to charge composition fee for late
construction/non-execution of lease deed in terms of Resolution dated
22nd August 2007. The Petitioners would pay the amount due and
payable in terms of the said Resolution within four weeks.
3. After completion of pleadings when the matter was heard on 29 th
November 2010 this Court passed the following order:
"1. There are two points urged by learned counsel
for the Petitioners. The first one relates to the levy
of composition charges for non-execution of the
lease deeds within the stipulated time by Delhi State
Infrastructure & Industrial Development
Corporation („DSIIDC‟).
2. The submission on behalf of the Petitioners is that
even according to the DSIIDC, the time for the
allottees to come forward to get the lease deed
executed was extended from time to time. The last
extension was up to 15th September 2007 subject to
payment of penalty of Rs. 50,000/-. Reference is
made to minutes of two meetings dated 6th July
2006 and 22nd August 2007 which records the fact
that a decision had been taken to permit conversion
from leasehold to freehold even in those cases
where a lease deed had not been executed. It is
accordingly submitted that in such cases where no
lease deed had been executed, conversion should be
permitted without insisting on payment of
composition charges for non-execution of the lease
deed.
3. The reply filed by the DSIIDC points out that at
no point of time any decision was taken to waive the
requirement of the execution of the lease deed. Even
when there was an extension of time for execution
of the lease deed, the composition charges were
being collected. As far as the last extension up to
15th September 2007, the penalty of Rs. 50,000/-
was in addition to the composition charges. As
regards the minutes of the two meetings held in July
2006 and August 2007, it is submitted that the
minutes of meeting were not approved by the
competent authority and there was no Notification
for waiving the requirement of execution of any
lease deed.
4. As regards this issue, this Court is of the view
that the Petitioner cannot escape the requirement of
having to pay the composition charges for non-
execution of the lease deed. It appears that in
November 2005 the conversion policy was
launched. Although the allottees were permitted to
raise construction even without formal execution of
the lease deed, throughout this period lease deeds
were in fact being executed. Composition charges
were collected from the allottees as and when they
executed lease deeds. There appears to have been no
notification or circular issued at any point of time
either waiving the requirement to pay composition
charges or permitting the allottees to straightaway
be granted conversion without executing the lease
deeds. Consequently, this Court is not impressed
with the submission that such of the Petitioners,
who may have raised construction and who are now
opting for conversion of the property from freehold
to lease hold should not be required either to execute
a lease deed or to pay the composition charges. The
first point urged by the Petitioner is accordingly
rejected.
5. The second point urged by the Petitioner is that
the conversion charges have been increased
arbitrarily from Rs. 7500/- per sq. mtr. in 2005-06 to
18,000/- per sq. mtr. in the year 2006-07 and Rs.
19,800/- per sq. mtr in 2007-08. It is submitted that
the relevant notification itself states that the DSIIDC
would follow the Delhi Development Authority
(„DDA‟) pattern and even in respect of commercial
properties in Narela, the DDA were charging for
conversion only at the rate of Rs. 13,300/- per sq.
mtr and for industrial plots, at Rs. 9900/- per sq.
mtr. It is accordingly submitted that the increase in
the conversion charges by the DSIIDC is arbitrary
and irrational.
6. As regards the second point concerning the
increase in the conversion charges from Rs. 7500/-
per sq. mtr in 2005-06 to Rs. 18,000/- per sq. mtr in
2006-07 and Rs. 19,500/- per sq. mtr in 2007-08,
this Court finds that there is no proper explanation
offered by the DSIIDC indicating the basis on which
this increase was effected. In its reply to Writ
Petition (Civil) No. 12226/2009 the DSIIDC has
explained that only 10% of the conversion charges
have to be actually paid. Where the plot holder is an
original allottee a further rebate of 40% has been
granted. The formula for calculation of the
conversion charges for a plot size of 350 sq. mtr is
indicated as under:
„P x R x 10 - 40% rebate (original allottee)
P = Plot area
R = Rates notified by the Govt. of NCT of
Delhi (GNCTD).‟
7. If indeed the rates are those notified by the
GNCTD and are not those determined by the
DSIIDC, a further question arises as to what the
notified rates of the GNCTD were at the relevant
point of time. This is not clear from the reply of the
DSIIDC.
8. A second question that arises is in the context of
the fact that the relevant circular of the DSIIDC
mentions that the DDA pattern of rates would be
followed. However, the actual conversion charges
fixed by the DSIIDC appear to be much higher than
the rates notified by the DDA both for industrial and
commercial plots in Narela (i.e. Rs. 9,900/- per sq.
mtr and Rs. 13,300/- per sq. mtr respectively).
9. Ms. Arora, learned counsel for the DSIIDC states
that she may be permitted to file an additional
affidavit explaining the basis on which the
conversion charges were fixed for the years 2006-07
onwards. She states that the relevant documents
containing the calculations or the formula on the
basis of which enhanced conversion charges were
fixed would also be enclosed. The additional
affidavit with documents be filed by the DSIIDC
within four weeks. The Petitioners are permitted to
file a reply to the said additional affidavit of the
DSIIDC within two weeks thereafter.
10. List on 18th February 2011."
4. Pursuant to the above order, an affidavit was filed by the DSIIDC on
14th February 2011 and a reply thereto was filed by the Petitioner on 3rd
March 2011. Thereafter when the matter was again heard on 15th March
2011, the following order was passed:
"1. It is seen from the affidavit filed by the DSIIDC that
the Committee constituted to revise the conversion rate
adopted the DDA‟s rates and made its recommendation on
that basis on 19th June 2008. For Narela Industrial Area the
Committee recommended a conversion rate of Rs. 9,000/-
per sq. m. for the year 2006-2007 based on the prevalent
DDA rates. For the subsequent years 2007-2008 and 2008-
2009 a 10% increase in each year was proposed. When the
Committee‟s recommendation was seen by the Minister of
Industries he took the view that going by the past practice
the conversion rates for plots in the Narela Industrial Area
should not be different from the rates recommended for the
Badli Industrial Estate, i.e. Rs. 18,000/- per sq. m.
2. It is seen from the tabular chart which forms a part of
the Circular dated 10th July 2008 issued by the
Commissioner of Industries, that a uniform conversion rate
at Rs. 18,000/- per sq. m. has been proposed for the year
2006-07 industrial plots in industrial areas in three zones,
i.e., East, North and West. For the industrial plots in the
South Zone for the year 2006-07 the uniform conversion
rate recommended is Rs. 25,920. This has been followed
in the subsequent years 2007-2008 and 2008-2009 with a
10% increase for each year.
3. The Petitioner‟s contention is that Narela Industrial
Area is to be considered as a separate zone. It cannot be
equated with the Badli Industrial Estate for the purposes of
fixation of conversion rates. On the other hand, Ms.
Salwan states that Narela Industrial Area and Badli
Industrial Estate are in the North zone and the consistent
past practice has been to treat them at par for the purposes
of conversion rates. She states that she will file a
supplementary affidavit explaining why Narela Industrial
Area and Badli Industrial Estate continue to be treated at
par for the purpose of conversion rates. The supplementary
affidavit be filed within two weeks.
4. List on 20th April 2011."
5. Pursuant to the aforementioned order dated 15 th March 2011, the
DSIIDC has filed a supplementary affidavit on 18th April 2011 in which
it is stated as under:
(i) The DDA does not have any industrial estate at Badli or
Narela. Consequently, certain other factors had to be taken into
account while fixing the conversion rates for the industrial estate
at Narela;
(ii) The DSIIDC and the Industries Department, GNCTD had
been fixing the land rates based on the rates fixed by the DDA in
the nearby estates falling in the same zone. Since Narela and
Badli are in the same zone, the conversion rates fixed by the
DDA in its north zone have been adopted for Narela and Badli;
(iii) even prior to the launch of the conversion scheme there has
been parity in rates fixed by the government for disposal of lands
in the industrial estates at Badli and Narela; and
(iv) the circle rates fixed by the Revenue Department of the
GNCTD are the same for Badli Industrial Area and Narela
Industrial Area. As per the categorization of colonies by the
Municipal Corporation of Delhi ('MCD'), Badli and Narela
Industrial Area are at par, as both fall in the category 'G'.
6. Mr. Sanjiv Bahl, learned counsel appearing for the Petitioners
submitted that the above explanation offered by the DSIIDC is mere
reiteration of the earlier stand taken by it in the matter. He further
submitted that the circle rates relied upon in the aforementioned
supplementary affidavit dated 18th April 2011 were notified as recently
on 4th February 2011 and therefore, would not be relevant for the
purpose. He submitted that circle rates, if at all, pertaining to the
relevant period 2007-08 had to be considered. He further pointed out
that in terms of the recent announcement of circle rates in Delhi
announced on 4th February 2011 effective 8th February 2011, all
industrial areas have been categorized in Zone 'G'. This, therefore,
would not have a bearing on the conversion rates. Mr. Bahl referred to
the notings on the file which showed that the Committee constituted for
the purpose had made a categorical recommendation that the
conversion rates of 2006-07 for Narela Industrial Area should be at Rs.
9,000/- per sq. m. He pointed out that in the letter written by the COI to
the DDA on 19th May 2008 the queries raised pertained to
corresponding zones of the DDA within which the industrial estates in
Badli and Narela fell. In reply thereto on 3rd June 2008 the DDA left the
zone in which the Badli Industrial Estate should be slotted to be
decided by the COI itself. As regards the Narela industrial area the
letter clearly mentioned that this area was within the Narela zone of the
DDA. The minutes of the meeting of the Committee held on 18 th June
2008 also took note of the fact that the conversion rates of 2005-06
both for Badli and Narela Industrial Area at Rs. 7,500/- per sq. m.
acknowledging that Narela was a separate zone. The Committee
recommended the conversion rate of Rs. 18,000/- per sq. m. It is
submitted that it is only because the Minister of Industries raised a
query as to why the conversion rates for Narela should not be the same
as for the Badli Industrial Area that the prices were equated. It is further
submitted that there was no basis to equate Narela with the Badli
Industrial Estate for the purposes of fixation of conversion rates. Mr.
Bahl further submitted that the commercial rates for properties in
Narela has been fixed by the DDA as on 15th February 2009 at Rs.
15,112/- sq. m. which is far less than the rates fixed by the COI for
industrial plots in terms of the Circular dated 10th July 2008 for the
same year 2007-08. He submitted that it is unlikely that rates for an
industrial area can be more than those for a commercial area. He further
submitted that having decided to adopt the rates fixed by the DDA, the
COI should not be permitted to change its stand and fix different rates
for conversion for the Narela Industrial Area.
7. Appearing for the DSIIDC, Ms. Renuka Arora, learned counsel
submitted that the COI was not bound to follow the DDA‟s rates since
in any event the DDA does not have an industrial estate in Narela. She
pointed out that Narela and Badli industrial estates are in the same
zone, categorized by the MCD as falling in category „G‟. She submitted
that various factors were considered before equating the conversion
rates for Narela and Badli industrial areas. She further submitted that
there is no reason to keep the conversion rates for Narela industrial area
lower than those for other industrial areas in the North zone. She
submitted that there is nothing arbitrary in the decision of the COI to
fix the conversion rates for industrial plots in Narela for the year 2006-
07 at Rs. 18,000/- per sq. m. at par with the Badli industrial estate.
8. The above submissions have been considered. It is correct that the
Committee in its meeting on 18th June 2008 recommended the fixation
of conversion charges as per the rates charged on provisional basis by
the DDA. It is also not in dispute that the DDA identified the Narela
industrial area as falling in the Narela zone whereas the Badli industrial
estate was not assigned any particular zone. However, the above
categorization of industrial plots by the DDA into different zones was
not necessarily binding on the COI. As already noticed, the DDA did
not have an industrial estate in Narela. It was, therefore, not obligatory
for the COI to adopt the categorization of the DDA. On the other hand,
the MCD recognized both Badli and Narela industrial areas as falling in
the „G‟ zone. The latest notification regarding circle rates places all
industrial areas including Narela and Badli in Zone „G. The decision of
the Committee was only in the form of a recommendation. The query
raised by the Minister of Industries as to why the conversion rates in
Narela should not be at par with Badli industrial estate cannot in the
circumstances be said to be unjustified or irrelevant. Moreover, the
scope of interference by this Court with administrative decisions
concerning fixation of conversion rates is limited. The Court is satisfied
that relevant materials have been accounted for, and irrelevant
considerations kept out, in arriving at the decision to fix the conversion
rate for the industrial plots in Narela for 2006-2007 at Rs. 18,000 per
sq. m. and increase it by 10% for every subsequent year.
9. Consequently, this Court does not find any ground to interfere with
the impugned circular dated 10th July 2008 issued by the COI fixing the
rates of conversion of industrial plots in Narela Industrial Area from
leasehold to freehold at Rs. 19,800/- per sq. m. for the year 2007-08.
10. Consequently, there is no merit in these petitions and they are
dismissed as such. The pending applications are disposed of.
S. MURALIDHAR, J
APRIL 25, 2011
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