D.D.A. vs Videocon Industries Ltd & Anr.
2012 Latest Caselaw 3152 Del

          *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                       Date of decision: 11th May, 2012

+Rev.P.719/2011 & CM.No.21499/2011 (for stay) in LPA No. 411/2007

D.D.A.                                                     ..... Appellant
                            Through:       Mr. Rajiv Bansal and Mr. Rahul
                                           Bhandari, Advocates.

                                       Versus

VIDEOCON INDUSTRIES LTD & ANR.               ..... Respondents
                Through: Mr. Ravinder Sethi, Sr. Advocate
                          with Mr. Brahm S. Nagar and Mr.
                          Rajeev, Advocates.

CORAM :-
HON'BLE THE ACTING CHIEF JUSTICE
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

RAJIV SAHAI ENDLAW, J.

1. This Bench has vide judgment dated 14th November, 2011 allowed the

appeal of the DDA by setting aside the order of the learned Single Judge

insofar as limiting the claim of the appellant DDA for unearned increase, to

the rate of ` 100/- per flat/floor space, and upholding the demand of the

appellant DDA for unearned increase. While so upholding the demand of the

appellant DDA, notice in para 13 of the judgment was taken of the argument

of the respondent/Review Applicant that the appellant DDA while

computing the unearned increase had considered the market rate / price,

more than that declared by the Delhi Government from time to time. The

said argument was however negatived by holding that the appellant DDA

having itself from time to time published market price for the purpose of

unearned increase and the demand on the respondent/ Review Applicant

being in terms of the prices so notified, in the absence of any challenge to

the said Circulars of the DDA, DDA could not be held bound to compute the

unearned increase on the basis of market price declared by any other agency.

2. This review application is confined to the aspect of market price

which can form the basis of the demand for unearned increase. It is the case

of the respondent/Review Applicant that DDA had been calculating

unearned increase on the basis of schedule of market prices notified by the

Department of Urban Development, Ministry of Urban Affairs and

Employment, Government of India and there was no occasion for the DDA

to depart from the said rates; that the Circulars relied upon by the DDA were

provisional and in the absence of any notification of the market price by the

competent authority i.e. the Ministry of Urban Affairs and Employment,

DDA could not on its own determine the market rate/price. It is thus the

case in the review application that the market rate of `57,960/- per sq mtr. as

published by the Ministry of Urban Development for the relevant years

1998-2000 ought to have been applied instead of the rate of `88,128/- per sq

mtr. applied by the DDA in computing the demand. Review is also sought

of the demand qua interest on unearned increase.

3. Notice of the review application was issued. Reply has been filed by

the appellant DDA and to which rejoinder has been filed by the

respondent/Review Applicant. The counsels have been heard.

4. The senior counsel for the respondent/Review Applicant has invited

attention to -

(i) letter dated 16th April, 1999 of the Department of Urban

Development, Ministry of Urban Affairs and Employment to the DDA

informing of the decision to retain the market price as published for the

period 1st April, 1994 to 31st March, 1996 also for the period 1st April, 1996

to 31st March, 1998 and intimating the prices fixed for the period 1 st April,

1998 to 31st March, 2000 wherein the price fixed for Jhandewalan, for

commercial purpose, was at the rate of `57,960/- per sq. meter;

(ii) letter dated 18th January, 2002 of the DDA to the Ministry of Urban

Development informing that the market rate of land fixed by the Ministry

were not followed by the DDA except for the purpose of lease

administration i.e. for the purpose of working out of misuse charges,

unearned increase etc; that in the absence of any notification from the

Ministry qua prices w.e.f. 1st April, 1996, DDA had increased the rates on a

provisional basis between 1 st April, 1996 to 31st March, 2000 (and in

accordance wherewith the rate of `88,128/- per sq. mtr. was applied by

DDA) and seeking permission for adopting the same;

(iii) Circular dated 15th February, 1999 of Land Costing Wing of the DDA

also to the effect that the rates fixed by the DDA for the period after 1 st

April, 1996 were provisional.

5. On the basis aforesaid, the senior counsel for the respondent/Review

Applicant has contended -

(i) that since the subject land is nazul land i.e. belonging to the

Government, though management thereof is vested in the DDA, the DDA is

bound by the Government rates;

(ii) that as per the letter dated 18th January, 2002 and Circular dated 25th

May, 1999 (supra) of the DDA also, the rates fixed by it w.e.f. 1st April,

1996 were, in the absence of any rates prescribed by the Government of

India and provisional and of which DDA had sought approval from the

Government of India;

(iii) that no approval was granted by the Government and thus DDA could

not have / cannot charge the rates as mentioned in the letter dated 18 th

January, 2002;

(iv) reliance in this regard is placed on paras 39 to 42 of the DDA Vs.

Joginder S. Monga (2004) 2 SCC 297 to contend that Central Government

is the ultimate authority for determination of market value and without the

proposal of the DDA receiving any favourable response from the Central

Government, DDA was bound by the conscious decision of the Central

Government retaining the rates for the period 1st April, 1996 to 31st March,

1998;

(v) Qua interest it is stated that since the demand for unearned increase

was itself raised in the year 2000, no interest for the period prior thereto, as

demanded, could have been demanded. Reliance is placed on a Circular

dated 16th August, 2005 of the Co-ordination (Land Disposal) Wing of the

DDA in this regard.

6. The counsel for the appellant DDA per contra has argued that the

respondent/Review Applicant in the garb of review is re-arguing the matter.

It is contended that no arguments as raised now were raised at the time of

earlier hearing. It is highlighted that no challenge to the demand of interest

also was made at that time. The judgment in Joginder S. Monga (supra) is

sought to be distinguished by contending that it was a case where the

demand of the DDA was struck down for the reason of being in direct

conflict with the letter dated 16 th April, 1999 (supra) of the Central

Government. It is urged that DDA on 25th May, 1999 had fixed its own rates

and also communicated the same to the Central Government vide letter dated

18th January, 2002; that the Central Government had not controverted the

said proposal of the DDA and is deemed to have accepted the same. It is

also argued that the market rate is different from pre-determined rate. It is

further contended that w.e.f. 19 th April, 2006, even the concept of pre-

determined rates has been given up and DDA is now relying only on

auction. The counsel for the DDA has further stated that even if there are

any errors in the demand for interest, and if the demand for interest is

contrary to the Circular dated 16 th August, 2005 (supra) of the DDA itself,

upon the respondent/Review Applicant pointing out the said error, the same

will be corrected by the DDA itself.

7. The senior counsel for the respondent/Review Applicant in rejoinder

has reiterated the earlier submissions and has contended that the pleas now

taken are there in the file.

8. We find considerable merit in the argument of the counsel for the

appellant DDA that all the arguments now raised were not raised at the time

of hearing of the appeal on 20th October, 2011. The respondent/Review

Applicant indeed has sought to re-argue the matter. The reliance in this

regard on the written arguments filed or the pleas taken in the pleadings but

which were not urged at the time of hearing and during the oral submissions,

is of no avail. Either the counsels should give up the right of oral

submission by placing reliance on the pleadings and the written arguments

and if make oral submissions, the Court can proceed on the premise that the

other pleas in the pleadings are not urged and ignore the same. It is not as if

the respondent/ Review Applicant in the present case did not at the time of

hearing, challenge the rate at which the demand for unearned increase was

made. However, the only argument was that the rates of the Government

were to apply. Neither the judgment on which the reliance is now placed nor

the documents, some of which are filed for the first time with the review

application, were referred to.

9. Though the review application is liable to be dismissed on this ground

alone but to do complete justice, we deem it appropriate to examine the

arguments now raised, on merits.

10. As far as the demand for interest is concerned, the counsel for the

appellant DDA having stated that the same would be gone into when the

respondent / Review Applicant approaches the DDA for payment in terms of

that part of the judgment which is not under challenge, we do not deem it

necessary to adjudicate on the same.

11. We have in our judgment dated 14th November, 2011 held the

appellant DDA to be entitled to 50% of the unearned increase. It is not in

dispute that the unearned increase is the difference between the premium

paid for the land and the „market price on the date of sale, transfer, assign,

parting with possession‟. The question which arises is, as to what that

market price is to be. We find that the market price was being fixed by the

Central Government and the DDA was following the same till 31 st March,

1996. However, it appears that the Central Government did not fix the

market prices w.e.f. 1st April, 1996 and the decision in this regard remained

pending for long. However since DDA, in administration of leases granted

by it was required to apply the market price, DDA, w.e.f. 1st April, 1996, in

the absence of market prices fixed by the Government, started itself fixing

the market price for commercial lands by increasing the same by 20% every

year over the price fixed by the Government for the period 1 st April, 1994 to

31st March, 1996. It was only vide letter dated 16th April, 1999 that the

Central Government communicated the decision to retain for the period 1st

April, 1996 to 31st March, 1998, the market prices as fixed for the period 1 st

April, 1994 to 31st March, 1996. The rates w.e.f. 1st April, 1998 to 31st

March, 2000 were also communicated.

12. We can safely assume that in the absence of any decision of the

Central Government between 1 st April, 1996 to 16th April, 1999, DDA

would have administrated other leases during the said period by treating the

market price increased by 20% as aforesaid and claimed unearned increase

and other charges from other lessees on the said basis. By applying the said

increases, the market price of the subject land in the year 2000 was

`88,128/- per sq. mtr. as against the price of `57,960/- per sq. mtr.

prescribed by the Central Government.

13. The aforesaid facts would show that a piquant situation had arisen,

with DDA treating the market prices to be higher than the market price

fixed by the Central Government. If the DDA were to after receipt of letter

dated 16th April, 1999 (supra), follow the rates fixed by the Central

Government, it would have resulted in DDA charging different rates from

different persons though similarly situated. It is perhaps for this reason that

DDA vide its letter dated 18th January, 2002 sought the approval from the

Central Government of its own rates.

14. Though the counsel for the DDA has been unable to show that any

approval was so accorded and the argument of the deemed approval cannot

be accepted but we nevertheless hesitate from directing the DDA to apply

the Central Government rates. As aforesaid, DDA must have dealt with other

leases as per its own rates; DDA cannot be directed to treat the market price

in the year 2000 as lower than that applied by it in the year 1998-99.

15. That brings us to the judgment of the Apex Court in Joginder S.

Monga (supra). The said case was concerned with Nazul land i.e. land

belonging to the Government and placed at the disposal of DDA for

management. It was in reference to such land that the Supreme Court held

that the Central Government was the ultimate authority for determination of

the market value and the Central Government having taken a decision to

continue with the same valuation, DDA as a delegatee of the Central

Government could not question the said decision.

16. The question which arises is whether the aforesaid judgment can be

applied to the present case. The answer would depend upon, whether the

subject land is Nazul land or not. Though the senior counsel for the

respondent/Review Applicant has argued that the subject land is Nazul land

but a minute perusal of the writ petition as well as the review application

does not show any such plea having been taken therein, though the land has

been described as Nazul land in the rejoinders and to which the appellant

DDA has had no occasion to respond.

17. We have in our enquiry as to whether the subject land can be said to

be Nazul land, perused the Delhi Development Authority (Disposal of

Developed Nazul Land) Rules, 1981, as then in force. Rule 23 thereof

provides for the lease of Nazul land to be as per Form „A‟ or Form „B‟

appended to the rules. A perusal of Form „A‟ and Form „B‟ shows that the

lease of Nazul land is to be "BETWEEN THE PRESIDENT OF INDIA

(hereinafter called " the Lessor") through the Delhi Development

Authority........." on the one hand and the lessee/sub-lessee on the other

hand. This is in consonance with, Nazul land being land owned by the

Central Government and placed at the disposal of the DDA for development,

control, supervision, management etc. However when we look at the lease

deed of the subject land filed by the respondent/Review Applicant itself

along with the writ petition, we do not find the lease to have been granted by

the President of India acting through the DDA but to have been granted by

the DDA itself. It thus cannot be said that the DDA in the matter of grant of

subject land has acted on behalf of the Central Government or that the

Central Government is the owner of the subject land.

18. Once it is found that the subject land is not a Nazul land but land

belonging to DDA itself, even if DDA in the past has in the administration

of leases of non-Nazul land also followed the rates determined and fixed by

the Government, it cannot be bound by the said rates and having fixed its

own rates and which as per aforesaid are not under challenge, would be

entitled to administer the leases of the non-Nazul land in accordance with

the said rates.

19. Judicial notice can also be taken of the fact that the prevalent market

rates are invariably higher if not much higher than the rates fixed by the

governmental authorities. It cannot also be lost sight of that if the

consideration for transfer as reflected in the document of transfer is higher

than the governmental/DDA rates, unearned increase is to be computed on

the basis of the actual consideration. However since the transfer/assignment

in the present case was through the route of amalgamation and for which

reason the actual consideration paid for the land is not visible, one has to fall

back on the rates so fixed by the Government/DDA.

20. We therefore, even on merits, do not find any merit in this review

petition which is dismissed. No order as to costs.

RAJIV SAHAI ENDLAW, J

ACTING CHIEF JUSTICE

MAY 11, 2012 „M‟/pp