5. This Allotment Letter will be valid only for a period of 30
days from the date of its issue and in the event of failure to
pay the amount indicated at para 4 (a). allotment stands
automatically cancelled and E.M.D. paid stands forfeited.
6 (a) In case of your failure to pay the amount mentioned at
para 4 (b) before expiry of the time stipulated therein, this
offer of allotment stands automatically expired and the
Earnest Money Deposit and 25% of the amount paid by you
towards cost of land stands automatically forfeited.
(b)If the balance land cost is not paid within 180 days from
the date of execution of lease agreement in respect of cases
mentioned at para 4 (c) the plot would be resumed on expiry
of the time stipulated without issuing any fresh notice.
7.Soon after receipt of the payment of 100% tentative cost of
land and on your acceptance of all the terms and conditions
indicated herein before and also those mentioned
hereinafter, the possession of land will be handed over within
30 days from the date of payment and at the time of taking
over possession you should produce the original receipt,
issued for the payment made to the Engineer incharge of the
area.
8(a) On taking possession of land, you shall adhere to the
time schedule indicated in the standard conditions appended
hereto."
6. The standard terms and conditions, which were applicable to
c) For commencement of 24 months from the date of taking
Production. possession of land.
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7. The appellant did not make the payment in terms of the
schedule as set out in the allotment letter. On the eve of the expiry
of the period of one hundred and eighty-days from the date of the
allotment letter, the appellant sent a letter inter alia praying that it
be provided further time till 13.08.2015 to pay the balance amount
without any interest or costs.
8. On 05.08.2014, KIADB sent a letter granting the appellant
ninety days extension from the date of the letter for payment of the
balance cost of the subject land amounting to Rs.5,04,00,000/-.
The appellant was informed that delay in payment would result in
levy of interest, and further steps to hand over possession of the
land would be taken after the payments are made.
9. The appellant did not pay the balance consideration within
the said period. In the meanwhile, on 07.08.2014, the State
Government passed an order approving the allotment of land by
KIADB on lease for a period of ninety-nine years. The said order
also applied to projects cleared by Single Window Clearance
Committees and KIADB Allotment Committee prior to 23.08.2013 in
cases where the lease-cum-sale agreement had not been signed
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for the reasons stated in the said order. By virtue of the said order,
the terms of allotment of subject land would stand altered to the
said extent.
10. It is also material to note that the said order also specifies
that if the land is not utilized for the project for which it is allotted
within a period of three years, the allotment of the lease will get
cancelled. It also specifies that if the land is not utilized within the
stipulated period as approved, the allotment of the lease would be
automatically cancelled and the land would be resumed by the
Government.
11. On 07.02.2015, KIADB sent a letter once again calling upon
the appellant to pay the balance consideration amount towards the
cost of land along with interest at the rate of 12.75 % per annum
from 05.11.2014 till the date of payment. The appellant was put to
notice that in case of failure to remit the amount within thirty days
from the date of receipt of the said letter, the allotment made in its
favour will stand automatically cancelled and no further
correspondence will be made in this regard. The appellant did not
make any payment within the said stipulated period as well.
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However, it sent a cheque for a sum of Rs.30 lakhs under cover of
its letter dated 22.05.2015 further stating that it would pay the
balance costs along with interest before 31.08.2015.
12. In the aforesaid circumstances, KIADB passed an order
dated 22.05.2015 cancelling the allotment of the subject land in
favour of the appellant. The appellant was also called upon to
return the original allotment letter along with the original receipts to
enable KIADB to refund the amount deposited by the appellant
after forfeiting the amount as stipulated.
13. However, KIADB encashed the appellant's cheque of Rs.30
lakhs on 27.05.2015.
14. On 16.06.2015, the appellant filed a writ petition being
W.P.No.25036/2015, which was rejected by the impugned order.
15. It is material to note that on 23.06.2015, the learned Single
Judge passed an interim order restraining KIADB from giving effect
to the cancellation order. The Court also observed that it would be
open for the appellant to pay the amount demanded and get the
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lease executed. The same would be subject to the outcome of the
petition.
16. On 11.06.2022, that is after almost seven years after filing
the writ petition, the appellant deposited a sum of Rs.1 crore on
11.06.2022 and a further sum of Rs.1 crore on 22.06.2022.
17. The appellant states that the Government order dated
07.08.2014 was effectively withdrawn on 01.01.2022 and the terms
of allotment were restored to a lease-cum-sale for a period of 10
years. In view of the above, the appellant filed a memo seeking
withdrawal of the writ petition, and the petition was dismissed by an
order dated 05.07.2023. The appellant claims that thereafter, it
deposited further sums of Rs. 1,00,00,000/- on 28.07.2022 and
Rs.1,18,00,000/- on 01.10.2022.
18. On 13.11.2024, KIADB sent a letter and Demand Draft for a
sum of Rs.4,38,00,000/- to the appellant, inter alia stating that the
appellant had deposited various amounts after issuance of the
cancellation order, without any demand notice from KIADB.
However, the appellant did not accept the same. It sent a
communication dated 20.11.2024 returning the demand draft and
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claiming that it had paid the balance tentative cost in terms of the
interim order passed by this Court.
19. The appellant thereafter filed an application for recall of the
order of dismissal dated 05.07.2023, venting its grievance that it
had paid the entire amount, but KIADB had not executed the lease-
cum-sale agreement. Appellant claimed that in similar
circumstances, KIADB had executed lease-cum-sale agreement in
respect of similarly situated persons. Apparently, the said
application was heard and accepted by order dated 29.02.2024.
The learned Single Judge heard the petition on merits and
disposed of the same in terms of the impugned order.
Reasons & Conclusions
20. Mr. Dhyan Chinnappa, learned Senior counsel earnestly
contended that the appellant had paid the entire consideration for
the allotment of the subject land and therefore, was entitled to the
same. He further stated that the appellant was ready and willing to
pay interest for the belated payment. In the alternative, it was also
willing to pay the current value for the subject land. He also
contend that at the time of allotment, the area was not developed
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and therefore, there was little possibility of utilizing the same for
establishing a Hotel or a Convention Centre.
21. We find no merit in the present appeal. There is no dispute
as to the essential facts. The appellant was allotted the subject
land in terms of the allotment letter dated 15.02.2013. There is no
ambiguity in the terms and conditions of the allotment. In terms of
the of the said letter, the appellant was required to pay a sum of
Rs.18,00,000/- on or before 14.03.2013 and the balance 80%
consideration on or before 13.08.2013. Clause 5 of the allotment
letter clearly stipulated if the payment of a sum of Rs.18,00,000/-
was not made within the period of thirty days as stipulated in clause
4(a), the allotment would stand automatically cancelled and the
earnest money [EMD] would stand forfeited.
22. The appellant was given another opportunity to pay the
amount in terms of the letter dated 05.08.2014, whereby the
appellant was granted further ninety days from the date of the letter
to make the balance payment. However, the appellant failed to
make the payment as required. The appellant was granted yet
another opportunity in terms of the letter dated 07.02.2015,
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whereby it was called upon to make the balance payment along
with interest at the rate of 12.75% from 05.11.2014 till the date of
payment. The appellant was clearly put to notice that failure to
remit the amount within a period of thirty days of receipt of the said
letter would result in automatic cancellation of the allotment made
in its favour.
23. Concededly, the appellant had not made the payment within
the said period. Thus, the allotment in its favour was cancelled by
an order dated 22.05.2015, which was communicated to the
appellant by a letter dated 22.05.2015 / 23.05.2015.
24. We do not think that the appellant can draw any benefit of
having sent the sum of Rs.30 lakhs under the cover of its letter
dated 22.05.2015 or KIADB having encashed the same. The said
payment was not in conformity with the letter dated 07.02.2015 and
therefore, the appellant did not acquire any right for sustaining the
said allotment on account of such payment. The appellant's
challenge to the order dated 07.08.2014 issued by the Government
changing the terms of the allotment to a lease for a period of 99
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years, is insubstantial. The appellant had not acquired any interest
in the subject land as on the date of the said order, as the appellant
had not paid the consideration, which was a pre-condition for
execution of the lease-cum-sale agreement. The appellant thus
acquired no right to insist that the terms of allotment be adhered to.
However, if the appellant did not wish to accept the lease for 99
years, it was open for the appellant to take steps for avoiding the
allotment. It is also material to note that the changed terms would
be applicable to allotments made prior to 23.08.2013 only in cases
where lease-cum-sale agreement had not been signed due to the
reasons stipulated in the Government Order. In the present case,
the lease-cum-sale agreement was not signed on account of failure
on the part of the appellant to pay the consideration as required.
25. The appellant had secured an interim order on 23.06.2015
whereby it was permitted to pay the amount as demanded and
obtain the lease-cum-sale agreement in its favour, subject to the
outcome of the petition. However, the appellant did not make any
payment for a period of almost seven years after having secured
the said interim order. However, it made certain payments in June
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and July 2022 (Rs. 1 crore on 11.06.2022; Rs.1 crore on
22.06.2022; Rs.1 crore on 28.07.2022 and Rs.1.18 crore on
01.10.2022).
26. Admittedly, the said payments were made without any
demand or notice. In the meanwhile, the appellant had after
making payments, withdrawn the writ petition as per order dated
05.07.2023. Notwithstanding the same, it claimed that it had made
payments in terms of the interim order dated 23.06.2015.
However, the said order clearly stipulated that the sale was subject
to the appellant ultimately succeeding. In terms of the interim
order, the appellant was permitted to pay the amount demanded
and obtain the lease agreement which would "remain subject to the
result of this petition". Since, the petition was dismissed as
withdrawn, the interim order did not survive. The appellant can
draw no benefit out of the said interim order.
27. We find no grounds to set aside the cancellation of the
allotment of subject land in favour of the appellant. The learned
Single Judge rightly declined the challenge to the cancellation
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letter. We find no ground to fault the impugned order. The appeal
is unmerited. The same is accordingly, dismissed.
Sd/-
(VIBHU BAKHRU)
CHIEF JUSTICE
Sd/-
(C.M. POONACHA)
JUDGE
KS
List No.: 2 Sl No.: 29
