Karnataka High Court
Vst Tillers Tractors Limited vs Karnataka Industrial Areas ... on 16 June, 2023
Bench: C.M. Poonacha
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NC: 2023:KHC:20981
WP No. 11071 of 2017
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 16TH DAY OF JUNE, 2023
BEFORE
THE HON'BLE MR JUSTICE C.M. POONACHA
WRIT PETITION NO. 11071 OF 2017 (GM-KIADB)
BETWEEN:
1. VST TILLERS TRACTORS LIMITED
HAVING ITS REGISTERED OFFICE AT PLOTNO.1
DYAVASANDRA INDUSTRIAL LAYOUT
WHITEFIELD ROAD
MAHADEVAPURA POST
BENGALURU-560 048
REPRESENTED BY ITS MANAGING DIRECTOR
...PETITIONER
(BY SRI. ABHINAY Y T., ADVOCATE FOR
SRI. SIDDARTHA S G., ADVOCATE)
AND:
1. KARNATAKA INDUSTRIAL
AREAS DEVELOPMENT BOARD
#49, 4TH & 5TH FLOORS
EAST WING, KHANIJA BHAVAN
RACE COURSE ROAD
Digitally signed BENGALURU-560 001
by BELUR REPRESENTED BY ITS CHAIRMAN
RANGADHAMA
NANDINI ...RESPONDENT
Location: HIGH (BY SRI. P V CHANDRASHEKAR., ADVOCATE)
COURT OF
KARNATAKA
THIS WP IS FILED UNDER ARTICLES 226 & 227 OF THE
CONSTITUTION OF INDIA PRAYING TO QUASH THE LETTER
DTD.26.11.2016 VIDE ANNEX-M AND DIRECT THE RESPONDENT TO
REFUND A SUM OF RS.1,35,31,500/- TO THE PETITIONER ALONG
WITH INTEREST AT THE RATE OF 18% PER ANNUM FROM 6.8.2016
TILL THE DATE OF PAYMENT AND ETC.
THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN
'B' GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:
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WP No. 11071 of 2017
ORDER
The above Writ Petition is filed seeking for the following
reliefs:
"a) Quash the letter dated 26.11.2016 bearing
No.KA Ke Pra Ma/Kem Ka/Hanchike/473/12568/
2016-17 (Annexure-M) and direct the respondent to
refund a sum of `1,35,31,500/- to the Petitioner
along with interest at the rate of 18% per annum
from 6.8.2016 till the date of payment.
b) And pass such other orders as this Hon'ble
Court deems fit, in the interest of justice and
equity."
2. It is the case of the Petitioner that pursuant to the
approval of its project by the State High Level Clearance
Committee ('SHLCC' for short) in its meeting held on 4.3.2014,
wherein the project of the Petitioner for establishment of an
unit to manufacture "Power Tillers, Tractors and Agricultural
Machinery", in an extent of 15 acres of land in Jakkasandra
Industrial Area was approved, the Respondent - KIADB, vide
allotment letter 16.7.2014 (Annexure-C to the Writ Petition)
allotted 15 acres of land in Sy.Nos.16/P1, 16/b3, 16/b4, 134
and 16/b8 of Jakkasandra Industrial Area, Kolar District, at
`145.50 lakhs + 10% extra for corner plot charges. Thereafter,
the Petitioner, vide letter dated 12.8.2014 (Annexure-D to the
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Writ Petition) tendered the requisite amount being 30%
advance as stipulated by the KIADB and requested for grant of
an alternate land since the land and terrain is not suitable.
Upon a request made by the Petitioner for alternate land, the
KIADB vide its letter dated 30.10.2015 (Annexure-E to the
Writ Petition) allotted 15 acres of land in plot No.50 in lieu of
the earlier allotment and called upon the Petitioner to remit a
sum of `15,79,36,134/- towards the balance cost of the land.
3. The KIADB vide letter dated 13.5.2016 (Annexure-H
to the Writ Petition) informed the Petitioner that out of 15 acres
of land allotted, an extent of 8 acres is free from litigation and
remaining 7 acres is under litigation. The Petitioner, vide letter
dated 29.6.2016 (Annexure-J to the Writ Petition), having
regard to the fact that the land allotted to it is under litigation,
indicated its intention to withdraw the application for allotment
and sought for refund of the initial deposit of `6,76,57,500/-.
The KIADB refunded a sum of `5,41,26,000/-.
4. The Petitioner vide its letter dated 17.8.2016
(Annexure-K to the Writ Petition) sought for refund of the
remaining sum of `1,35,31,500/-. The KIADB failed to refund
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WP No. 11071 of 2017
the same. Hence, the Petitioner got issued a legal notice dated
26.10.2010 (Annexure-L to the Writ Petition) which was replied
by the KIADB vide its reply dated 26.11.2016 (Annexure-M to
the Writ Petition) whereunder the Petitioner was informed that
the said sum of `1,35,31,500/- retained by it has been forfeited
consequent to clause 1(a) of its Circular dated 31.8.2015
(Annexure-N to the Writ Petition). Being aggrieved, the
present Writ Petition is filed.
5. The Respondent - KIADB has entered appearance
and filed Statement of Objections contending, inter alia, that it
is entitled to forfeit 20% of the amount paid to it as initial
deposit having regard to the guidelines framed in the 335th
Meeting of its Board held on 14.8.2015.
6. Sri Abhinay Y.T, learned Counsel for the Petitioner
contended that the Petitioner was constrained to withdraw its
application for allotment of land since the KIADB did not allot
entire extent of 15 acres of land as required for starting its
manufacturing project. That since the Petitioner withdrew its
application for no fault on its part, the entire amount paid by it
is required to be refunded together with interest. In support of
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his contention, the learned Counsel relied upon a judgment of a
Co-ordinate Bench of this Court in the case of M/s. Chantilly
Group v. State of Karnataka and others1.
7. Per contra, Sri P.V.Chandrashekar, learned Counsel
for the Respondent - KIADB justified the forfeiture and sought
for dismissal of the Writ Petition.
8. I have considered the submissions made by both
the learned Counsel and perused the material on record. The
question that arises for consideration is:
Whether the Respondent is liable to refund the forfeited
amount to the Petitioner?
9. The essential facts regarding allotment of 15 acres
of land, payment of the initial deposit, only 8 acres of the land
out of the originally allotted area of 15 acres being available for
allotment, due to which the Petitioner sought for withdrawal of
its application and refund of the amount deposited and the fact
that the KIADB has refunded a sum of `5,31,26,000/- to the
Petitioner and forfeited a sum of `1,35,31,500/- being
WP No.65254/2016, DD 20.4.2023
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WP No. 11071 of 2017
undisputed, the only aspect that is required to be considered is,
whether the KIADB is entitled to forfeit the said amount.
10. In its 335th Meeting held on 14.8.2015 the Board of
KIADB approved guidelines to be followed for refund of the
amount remitted by allottees in respect of allotments made for
the industrial areas on the basis of which the Circular dated
31.8.2015 (Annexure-N to the Writ Petition) is issued. The
clause regarding forfeiture relevant for the present case is as
under:
"1. Allotments made in Industrial Areas
a) To forfeit 20% of the amount paid towards initial
deposit instead of 10% in cases of cancellation of
allotments for non-payment of balance land cost within
the stipulated period."
11. It is relevant to note that the allotment was made
by the KIADB to the Petitioner on 16.7.2014 i.e., prior to the
Circular being issued. Thereafter, the revised allotment was
made on 30.10.2015. It is undisputed that the Petitioner had
made the initial deposit prior to the guidelines being approved
by the Board of the KIADB.
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12. Notwithstanding the above, it is relevant to note
that the Petitioner has decided to withdraw its application for
allotment since the KIADB had communicated to the Petitioner
that only 8 acres of land (out of originally allotted land of 15
acres) is free from litigation and the remaining 7 acres is under
litigation. Hence, it is clear that the Petitioner was constrained
to seek for withdrawal of its application since the entire extent
of land allotted was not handed over by the Respondent -
KIADB.
13. Even the guidelines entitling the Respondent -
KIADB to forfeit 20% of the amounts paid towards initial
deposit is in respect of a case of "cancellation of allotment for
non payment of land cost within the time stipulated".
Admittedly, the present case is not a situation where the
allotment has been cancelled for non payment of the balance
land cost. Hence, the said stipulation regarding forfeiture is not
applicable to the facts of the present case and the relief sought
for by the Petitioner is liable to be granted. Accordingly, the
question framed for consideration is answered in the
affirmative.
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14. In the case of M/s. Chantilly Group1, a co-
ordinate Bench of this Court directed that amounts be refunded
with interest @ 6% per annum. However, the facts in the said
case are different from the facts in this case, inasmuch as in
the present case, the KIADB themselves intimated the
Petitioner that out of the entire land of 15 acres allotted, only 8
acres is free from litigation and 7 acres is under litigation. It is
in that context that the Petitioner withdrew its application for
allotment of land and requested for refund of the deposit
amount.
15. In view of the aforementioned, I pass the following:
ORDER
i. The Writ Petition is partly allowed;
ii. The letter dated 26.11.2016 passed in No.Ka Ke
Pra Ma/Kem Ka/Hanchike/473/12568/2016-17
issued by the Respondent is quashed;
iii. The Respondent is directed to refund to the
Petitioner a sum of `1,35,31,500/- within three
months from the date of receipt of a copy of this
order together with interest at 8% p.a., from the
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WP No. 11071 of 2017
date of the Writ Petition i.e., 10.3.2017 till date
of payment. In the event, the said amount
together with interest is not refunded within three
months as stipulated, the Respondent will be
liable to refund the entire amount together with
interest at 12% p.a., from the date of the Writ
Petition i.e., 10.3.2017 till date of payment.
No costs.
Sd/-
JUDGE
