Govt Of Nct Of Delhi & Ors. vs Wbm Systems Pvt Ltd & Ors.
2011 Latest Caselaw 330 Del

47.
*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                             Judgment delivered on: 20th January, 2011

+      LPA 76/2011

       GOVT OF NCT OF DELHI & ORS.          ..... Appellants
                    Through Ms. Avnish Ahlawat, Advocate.


                     Versus

       WBM SYSTEMS PVT LTD & ORS.           ..... Respondents

Through Mr. I.S. Alag, Mr. J.S. Lamba & Mr. R.S. Bisht, Advocates.

CORAM:

HON'BLE THE CHIEF JUSTICE HON'BLE MR. JUSTICE SANJIV KHANNA

1. Whether Reporters of local papers may be allowed to see the judgment?

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

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

SANJIV KHANNA, J.:

In this intra-Court appeal, Government of National Capital

Territory of Delhi assails the order dated 5th October, 2010 passed in

Writ Petition (Civil) No. 2957/1998 allowing the writ petition filed by

the respondent-M/s WBM Systems Private Limited and others. By the

impugned judgment, learned single Judge has quashed the order dated

6th May, 1998 passed by the appellant canceling allotment of plot No.

72, Functional Industrial Estate for Electronics, Okhla Industrial Area,

Phase-II, New Delhi (plot, for short). By the impugned order, the

LPA NO. 76/2011 P age 1 of 9 respondent-company who was one of the writ petitioners has been

granted the following consequential reliefs:-

"(i) The Respondents shall within eight weeks from today carry out the necessary changes to the lease deed in respect of the plot in question to reflect the change in the name of the lessee as M/s. WBM Systems (P) Ltd.

(ii) Within the said period of eight weeks, the Respondents will communicate to the Petitioner the unearned increase that is required to be paid by the Petitioner as on 21st April 1986.

(iii) The amount of unearned increase as communicated by the Respondents will be paid by the Petitioner within a period of eight weeks thereafter.

(iv) Subject to the aforesaid payment of unearned increase, the Respondents will carry out necessary changes in the lease deed.

(v) The Respondents will also consider extending the time for completion of construction for a further period of one year."

2. The plot was allotted to one Mr. P.D.S. Sawhney vide perpetual

lease deed executed on 9th February, 1984 as sole proprietor of M/s

World Business Machines. The plot was subsequently mortgaged with

Delhi Financial Corporation and a loan of Rs.9,88,000/- was

sanctioned. The lessee was required to raise construction within two

years from 9th February, 1984, i.e., by 8th February, 1986. The plot, it

appears was encroached by jhuggi dwellers and after some difficulty,

the jhuggi dwellers vacated the plot in October, 1985. By letter dated

22nd January, 1986 the lessee sought extension of time by one year for

LPA NO. 76/2011 P age 2 of 9 making construction.

3. By an earlier letter dated 18th January, 1986 the lessee had

sought permission for transfer of the leasehold rights in the name of

M/s WBM Systems Private Limited, i.e., the respondent No. 1

company herein. Mr. P.D.S. Sawhney and his wife, viz., Ms. Achla

Sawhney were the Directors of the said company. Vide letter dated

14th February, 1986 Mr. P.D.S. Sawhney was informed that he should

be ready to pay 50% unearned increase in the value of the property and

submit an undertaking. On 19th February, 1986, Mr. P.D.S. Sawhney

accepted the offer and submitted an undertaking to pay 50% unearned

increase. The appellant wrote another letter dated 21st April, 1986 that

they had in principle agreed to allow the lessee to transfer the land to

the private company consisting of Mr. P.D.S. Sawhney and his wife, as

directors with equal shares and subject to payment of unearned

increase, as and when demanded by the department.

4. The respondent company vide letter dated 3rd May, 1988

requested the appellant to issue No Objection Certificate for

mortgaging the plot with Punjab and Sind Bank Limited and to obtain

loan. Another letter dated 23rd June, 1988 was issued by the respondent

company to Deputy Director (Land) making the same request.

5. Mr. P.D.S. Sawhney had died in a road accident on 14 th

December, 1987.

LPA NO. 76/2011 P age 3 of 9

6. By letter dated 4th August, 1988 the appellant asked the

respondent company to file list of existing shareholders and directors.

On 10th August, 1988, the respondent company filed a certificate

issued by the Chartered Accountant mentioning the name of directors

and shareholders. On 20th September, 1988 the appellant wrote to the

respondent company asking for the following details:-

"i. Succession Certificate/Will form late Mr. P.D.S. Sawhney;

ii. Affidavit and Indemnity Bonds from the legal heirs;

iii. Conveyance Deed by legal heirs, conveying the property in the name of the company;

iv. Affidavit by legal heirs in regard to the payment of unearned increased and additional sum chargeable, etc."

7. The respondent company replied that pursuant to agreement

dated 1st October, 1985 amongst late Mr. P.D.S. Sawhney and his wife

Ms. Achla Sawhney and the respondent company all the assets and

liabilities of the proprietorship concern of late Mr. P.D.S. Sawhney had

been be taken over by the respondent company as a going concern.

Therefore, succession certificate, indemnity bonds etc. of late Mr.

P.D.S. Sawhney were not required. Copy of the agreement was

enclosed. It was reiterated that the respondent company was ready and

willing to pay 50% unearned increase.

8. In spite of the said letter, the appellant required the respondent

LPA NO. 76/2011 P age 4 of 9 company to furnish succession certificate. The respondent company

responded by letter dated 10th February, 1999 stating that the

succession certificate had not been received. Another letter dated 22nd

August, 1989 was written by the respondent requesting for formal

change of name of Lessee in the lease deed and extension of time for

completion of construction. Subsequently copy of the succession

certificate dated 17th February, 1990 issued by the Sub-Judge First

Class, Delhi in favour of the Ms. Achla Sawhney and her two minor

children was filed with the appellant. Learned single Judge has

recorded that the said certificate was on record.

9. On 6th August, 1991, show cause notice was issued by the

appellant alleging that the respondent company had not filed

documents as required vide letter dated 20th September, 1988 and there

was violation of the lease deed as the lessee had failed to construct on

the plot within the period of two years. It was also alleged that the

lessee had failed to apply for and pay composition charges for

default/delay in construction of the building. It was alleged that three

more directors had been inducted during the period 1986-87. The

respondent company responded by their detailed letter dated 10 th

October, 1991. A subsequent letter dated 12th October, 1993 was

written.

10. After a gap of nearly five years vide order dated 6th May, 1998

LPA NO. 76/2011 P age 5 of 9 the lease was cancelled. The cancellation order was addressed to Ms.

Achla Sawhney and World Business Machines. In the said cancellation

order the only reason and cause given is as under:-

"4. Whereas a Show Cause Notice was accordingly issued on 06.08.1991 for the violation of clause II 4(a) of the lease deed as the lessee has failed to erect the factory building within stipulated period. To verify the facts the report of the Estate Manager, Functional Industrial Estate for Electronics was asked and he confirmed that no construction activity was taken (sic) and the plot is still lying vacant.

5. Since the maximum permissible period has already expired on 08.02.91 and the allottee has failed to complete the construction of the factory building on the allotted plot, the Lessor i.e. Hon'ble L.G. of Delhi is pleased to cancel the allotment of the above said plot and determine the lease deed of plot No.72, FIEE, Phase-II, Okhla, New Delhi in favour of Sh. PDS Sawhney under the powers vested with him under clause III of the lease deed. The lessee is accordingly ordered to hand over the vacant possession of plot No.72, FIEE to the Estate Manager within a week of issue of this order. In case lessee fails to hand over the vacant possession of the said plot as ordered above, re-entry shall be affected by the lessor and possession of the said plot taken under the provision of law including Public Premises (eviction and unathorised occupant) Act."

11. It may be noted here that during the gap between 1993 to 1998,

the respondent company had written letters asking the appellant to

inform them about the unearned increase for transfer of the plot. They

had all along prayed to extension of time for carrying out construction.

The answering respondent company had submitted a pay order of

LPA NO. 76/2011 P age 6 of 9 Rs.2,33,500/- towards extension of construction period without any

demand being raised by the appellant.

12. The respondent company filed the writ petition No. 2957/1998

and vide order dated 15th June, 1998 status quo with regard to

possession was ordered to be maintained. The said order continued till

the impugned judgment was passed in favour of the respondent

company.

13. Learned counsel for the appellant has submitted that new and

unknown persons viz., Mr. Thomas Mathew, Mr. A.S. Duggal, Mr.

K.L. Chadha and Ms. Achla Sawhney were inducted as directors of the

respondent company. As far as the induction of Ms. Achla Sawhney is

concerned, the same cannot be objected to by the appellant. However,

as is clear from the order dated 6th May, 1998 quoted above, the lease

has not been cancelled on the ground of sub-letting or induction of new

directors. The lease has been cancelled on the ground of non-

construction and failure to construct within seven years. The appellant

cannot add or plead new grounds and reasons to the order dated 6th

May, 1998. The said order has to stand on its own legs and for the

reasons stated therein. The appellant cannot improve upon or make a a

new or different case (refer in this regard Mohinder Singh Gill v Chief

Commissioner (1978) 1 SCC 405; R. S. Garg v State of Gujarat

(2006) 6 SCC 430). In any case the respondent company has to pay

LPA NO. 76/2011 P age 7 of 9 unearned increase as per the impugned judgment.

14. As far as non-construction or delay in construction is concerned,

the default and the delay have been caused because of inaction and

failure of the appellant themselves. The detailed facts have been stated

above. The appellant had agreed to transfer the plot in the name of the

respondent company subject to payment of unearned increase. The

unearned increase was never communicated. Transfer/change in the

name of the lessee was never made. In the meantime, Mr.

P.D.S.Sawhney died on 14th December, 1987. In spite of the

agreement dated 1st October, 1985 between late Mr. P.D.S. Sawhney

and his wife and the respondent company, the appellant insisted on

documents including succession certificate vide their letter dated 20th

September, 1988, though once the transfer in the name of the

respondent company was accepted, there was no need for the said

documents. The succession certificate dated 17th February, 1990 was

also furnished. Written requests for extension of period of construction

were made and a pay order dated 26th March, 1997 of Rs. 2,33,500/-

towards composition fee was submitted by the respondent company to

the appellant but the extension was not granted. Without extension of

time and NOC from the appellant, construction could not have been

made on the plot. The appellant cannot take advantage of their defaults

and wrongs.

LPA NO. 76/2011 P age 8 of 9

15. In view of the aforesaid factual matrix, we do not find any merit

in the present appeal and the same is dismissed. No costs.

SANJIV KHANNA, J.

                                             CHIEF JUSTICE
       JANUARY 20, 2011
       VKR




LPA NO. 76/2011                                               P age 9 of 9