Citation : 2023 Latest Caselaw 3832 Tel
Judgement Date : 10 November, 2023
* THE HONOURABLE THE CHIEF JUSTICE ALOK ARADHE
AND
THE HONOURABLE SRI JUSTICE N.V. SHRAVAN KUMAR
+ WRIT APPEAL Nos.43, 120, 121, 131, 139, 181, 182, 183, 372,
367, 474, 525 of 2009
% Dated 10-11-2023
Between:
# K.Madhava Reddy and others
...Appellants/Petitioners
and
$ The State of Telangana,
Housing (HB).II) Department
Represented by its Principal Secretary
Secretariat Buildings, Hyderabad and others.
....Respondents
! Counsel for the Appellants : Ms. Divya Adepu and others
^ Counsel for the respondents : Mr.Harender Pershad, Spl.Govt.Pleader
< GIST : ---
>HEAD NOTE : ---
? Cases referred: :
1. AIR 1990 AP 331
2. AIR 1979 2C 621
3. (1993) 1 SCC 71
4. (1984) 3 AII ER 935 (HL)
5. (1985) 2 AII ER 327
6. (1979) 4 SCC 602
7. (2003) 5 SCC 437
8. (2021) 6 Supreme Court Cases 707
9. MANU/TL/1455/2022
10. 2023 SCC OnLine SC 994
11. (2019) 9 Supreme Court Cases 710
12. AIR 1993 SC 155
13. (1978) 1 Supreme Court Cases 405
HC, J & NVSK, J
THE HONOURABLE THE CHIEF JUSTICE ALOK ARADHE AND THE HONOURABLE SRI JUSTICE N.V. SHRAVAN KUMAR
WRIT APPEAL Nos.43, 120, 121, 131, 139, 181, 182, 183, 372, 367, 474, 525 of 2009
COMMON JUDGMENT: (Per the Hon'ble Sri Justice N.V. Shravan Kumar)
Heard Mr. D.Prakash Reddy, learned Senior Counsel
representing Ms. Divya Adepu, learned counsel for the appellants in
W.A. Nos.43, 120, 121, 181, 182 and 183 of 2009 and respondent
Nos.2 and 3 in W.A. No.131 of 2009.
2. Mr. V. Narasimha Goud, learned Standing Counsel for
Hyderabad Metropolitan Development Authority.
3. Mr. Harender Pershad, learned Special Government Pleader
appearing for the appellants for the State of Telangana in
W.A. Nos.131, 139, 367 and 372 of 2009 and for the respondents-
State in all the appeals.
4. Mr. L.Ravi Chander, learned Senior Counsel representing
Mr. K.R. Prabhakar, learned counsel for the appellants in W.A. No.474
of 2009 and for the respondents in W.A. No.139 of 2009.
5. Mr. O.Manoher Reddy, learned Senior Counsel appearing for the
appellant/Housing Board Employees IV-Phase Plot Allottees Welfare
Association in W.A. No.525 of 2009 and appearing for the respondent
No.1 in W.A. Nos.367 and 372 of 2009.
HC, J & NVSK, J
6. All these intra Court appeals have arisen out of the common
order dated 30.12.2008 passed in W.P. Nos.8048 of 2001, 19790,
19795 and 22657 of 2006 by the learned Single Judge.
7. Since the issues involved in these appeals are common and the
parties are one and the same, they are being disposed of by this
common judgment.
8. For the sake of convenience, the parties hereinafter will be
referred to as they were arrayed in the writ petitions.
9. All the writ petitions were filed seeking the same relief against
the same respondents, therefore, they were clubbed and heard
together and passed the impugned common order dated 30.12.2008 in
W.P. Nos.8048 of 2001 and 19790, 19795 and 22657 of 2006 by the
learned Single Judge.
10. All the writ petitions were filed with a prayer to direct the
respondents to register the plots in Sy.Nos.964 and 1009 of
Kukatpally village in Phase-IV of the lay out plan prepared for APHB
Employees Housing Scheme in the individual names of the Housing
Board Employees in pursuance of G.O. Ms. No.2, Housing
Department, dated 10.01.1991 and to declare the G.O.Ms. No.32,
Housing (HB.II) Department, dated 12.09.2006, issued by the
1st respondent, (then Government of Andhra Pradesh) as illegal, HC, J & NVSK, J
arbitrary, against the principles of natural justice and without
jurisdiction.
11. The case of the petitioners in the writ petitions is that the
petitioners are the members of the A.P. Housing Board Employees
Phase-IV Plot Allottees Welfare Association represented by its
President, Hyderabad. The said Association was registered under the
Andhra Pradesh Public Registered Societies Act, 1950 with registered
No.4567 of 2000.
BRIEF HISTORY:
12. All the members of the writ petitioners of the Association were
appointed in the year 1981-82.
13. In the year 1979, the A.P. Housing Board conducted demand
survey in all major towns of the State for construction of houses for
general public which included the housing scheme at Kukatpally.
At that point of time, the employees working in the Housing Board
made a requisition for allotment of plots and for the purpose of
allotment of plots, the Board has prescribed minimum service, income
limits and allotted 233 plots at Kukatpally to its employees and
collected the cost of the land at Rs.2.25 per square yard. Similarly,
the Board allotted plots to the employees under Phase-II and Phast-III,
Kukatpally collecting Rs.2.25 per square yard. The said action of the
Board was ratified by the State.
HC, J & NVSK, J
14. In the year 1981-82, members of the petitioner Association were
appointed in the Housing Board in various categories.
15. In the year 1986, the Board has conducted a demand survey
among the employees who were appointed on or before 31.12.1984 for
allotment of developed plots duly prescribing certain eligibility criteria
like minimum service of five years and income criteria.
BRIEF FACTS OF THE CASE:
16. The members of the Association are the employees of the
A.P. Housing Board and they were allotted plots in phase-IV of the lay
out at Kukatpally. In the year 1988, NGOs union of the A.P. Housing
Board made a representation to the Board requesting for allotment of
developed plots on the same analogy as was allotted to the Board
employees on earlier occasions. The Board in its meeting, dated
29.07.1998 resolved to recommend to the Government to accord
permission to allot 115 MIG, 181 LIG and 24 EWS plots to 320
employees in an extent of 13 acres of land situated at Kukatpally at
the rate of Rs.45/- per square yard including the cost of the land and
development charges subject to certain conditions. Thereafter,
the Government was pleased to consider the request of the Board and
accorded permission to allot plots to 320 employees on the Southern
side of Phase-IV of Kukatpally at the rate of Rs.45/- per square yard
as per G.O.Ms.No.2, Housing Department, dated 10.01.1991.
Accordingly, the individual plots were allotted to all the 320 members
on 12.05.1991 and in Circular No.19407/EM.4/RHE:WD/88, dated HC, J & NVSK, J
09.09.1991, the Vice Chairman and Housing Commissioner had
directed the Regional Engineers and other drawing and disbursement
officers to recover the cost of the plots and its development charges at
Rs.300/- per month per MIG and Rs.265/- per LIG and Rs.1500/- per
EWS respectively in 30 monthly installments. The cost and
development charges are recovered from all the 320 allottees by 1994.
The Housing Board, while sending proposals to the Government,
indicated plot areas of MIG on 233 square yards, LIG 200 square
yards and EWS at 111 square yards, which was worked out to 13
acres of lay-out plan approved by the Vice-Chairman and Housing
Commissioner on 31.03.1989. The actual area covered by the plots is
worked out to 13.66 acres excluding the road, parks play grounds
etc., and as such, the matter was placed before the Board in its 423rd
meeting held on 29.06.1992 and the Board has resolved to approach
the Government for necessary amendment to G.O.Ms.No.2, dated
10.01.1991. As the land is under the control of the Board,
the Secretary to the Government delegated authority to the Housing
Board to take action at Board level. Thereafter, the Board in its 449th
meeting held on 24.08.1995 resolved to allot Acs.26.541 of land to the
employees of the Board at Rs.116/- per square yard against Rs.45/-
per square yard and accordingly the Housing Board has to get the
plots registered in the name of allottees. Thereafter, on 29.11.2000,
the Housing Board in the 463rd meeting resolved to register the plots
charging at Rs.16/- per square yard towards costs of the land and
Rs.100/- per square yard towards development charges totaling to HC, J & NVSK, J
Rs.116/- per square yard. Thereafter, the respondent No.2 vide letter
dated 16.12.2000 asked the allottees to pay the difference amount of
Rs.71/- per square yard.
17. At this stage, the first respondent interfered with the decision of
the Board and directed the Board not to register any plots in Phase-IV
in favour of the A.P.H.B. Employees in terms of Board Resolution in
463 and 464 meetings till the Government gives a clear direction.
Basing on such direction, the second respondent instructed the third
respondent not to take further action to get the plots registered in the
name of the allottees pending further orders in the matter.
18. On 15.02.2001, the Vice Chairman and Housing Commissioner
gave instructions to the APHB that no further action regarding the
registration of plots should be taken. By virtue of the instructions and
subsequent letter dated 06.04.2001, the difference of amount was not
collected and by that time only 103 employees have paid the difference
of amount Rs.71/- per square yard and rest 217 could not pay the
amount. Thereafter, on 24.04.2001 the Principal Secretary to
Government issued direction to the Vice Chairman and Housing
Commissioner, APHB to stop registration of plots and also not to
accept the difference of amount from the remaining employees at the
rate of Rs.116/- square yard. By the time of the above instructions
were communicated, only 103 employees were able to pay the
additional differential cost of Rs.71/- per square yard. The remaining
217 employees had been denied the opportunity to pay the differential HC, J & NVSK, J
amount. Thereafter, a letter dated 14.12.2001 was issued by the Vice
Chairman and Housing Commissioner to the Government stating that
the new rate of Rs.204/- per square yard is estimated cost of land and
development and the Government may take necessary action.
Thereafter, on 16.01.2003, G.O. Ms. No.7 was issued by the
Government constituting a cabinet sub-committee comprising of
Revenue, Finance and Housing Minister. On 22.07.2003, the cabinet
sub committee recommended that the land already allotted to the
employees of A.P. Housing Board may be registered at the rate of
Rs.204/- per square yard including the developmental charges as
approved by the Board subject to the condition that if any increase in
developmental charge over and above Rs.204/- per square yard arises
at the time of execution, to be borne by the employee. Thereafter,
on 01.04.2005 Cabinet approved the sub committee report favouring
allotment of house sites to the Housing Board employees at the rate of
Rs.204/- per square yard and the Government asked the Vice
Chairman to submit the necessary proposals incorporating the
conditions as per G.O. Ms. No.244 and to that effect the Vice
Chairman Housing Commissioner has submitted a revised proposal
with a request to cancel all the allotments and provide houses in the
proposed Hydernagar scheme. On 08.09.2006, the Cabinet approved
the revised proposal of Vice Chairman and Housing Commissioner,
APHB vide resolution No.201(1)/2006, dated 08.09.2006. Thereafter,
on 12.09.2006, G.O. Ms. No.32 has been issued by the 1st respondent
canceling the orders issued in G.O. Ms. No.2, dated 10.01.1991 and HC, J & NVSK, J
permission was accorded to the Vice Chairman and Housing
Commissioner, APHB to construct individual flats instead of plots.
Thereafter, challenging the said G.O. Ms. No.32, dated 12.09.2006,
W.P. Nos.19790, 19795 and 22657 of 2006 have been filed.
19. In W.A. No.525 of 2009 arising out of W.P. No.19795 of 2006
wherein an order of status quo was granted on 18.04.2009 by this
Court.
20. Thereafter, on 30.05.2009, the Vice Chairman and Housing
Commissioner addressed a letter dated 30.05.2009 to the State
Government explaining the detailed narrative of the facts with respect
to the allotment of plots. Further, the Vice Chairman and Housing
Commissioner vide letter dated 15.03.2013 has informed the
Government stating that since all the 320 employees have paid more
than the land cost of Rs.16/- long back as per Board resolution dated
19.11.2000, requested the Government to issue necessary orders to
withdraw the Writ Appeals filed before this Court and also to ask all
the 320 employees to pay the difference of balance development cost
which may be calculated as per the present estimates to get their plots
registered in their favour.
CONTENTIONS RAISED BY THE PETITIONERS IN THE WRIT PETITIONS:
21. It is submitted that the Principal Secretary to Government,
without considering that the allotment was made in the year 1991,
raised an objection on the ground that the present market value is at HC, J & NVSK, J
Rs.3,000/- per square yard, whereas the allotment was made at
Rs.116/- per square yard.
22. It is further submitted that when the surrounding areas are
developed after a gap of more than 10 years, the prevailing rate is
found to be more and that cannot be a ground to stop registration
when the entire sale consideration is collected by the Board. There is
no dispute with regard to eligibility of the allottees and the
Government itself has accorded permission in G.O.Ms.No.2, dated
10.01.1991 for allotment of plots after considering the representation
and after collecting the sale consideration and that the allottees are
poor employees and they have contributed their hard earned money
with a fond hope of getting a plot, which would be an asset to them.
23. It is further submitted that the Housing Board is not a profit
making organization and it cannot do business in selling plots at
higher rates. The Government having formulated a scheme
contemplated under Regulation 21 of the A.P. Housing Board Act to
allot plots to the employees of the Board and having issued
G.O.Ms.No.2 to that effect, it is not open to the first respondent to
interfere with the scheme which is detriment to the interests of the
employees. When such similar schemes were approved by the
Government in the years 1979 and 1983 and all the employees, who
were working and eligible as on the respective dates, were allotted and
that the present petitioners are some of the employees left over under
the old schemes and joined in the service of the Board later.
HC, J & NVSK, J
24. In the writ petitions filed in the year 2006, it was contended that
subsequent to the direction by the first respondent not to register the
plots in favour of the individual employees, the Government
constituted a cabinet sub committee to examine the issue and after
examining the issue, the cabinet Committee submitted a report
favouring allotment of house sites to the Housing Board employees,
which was placed before the cabinet for approval on 01.04.2005 and
the cabinet approved the recommendations of the sub committee.
25. It was further mentioned in G.O.Ms.No.32 that the Government
permits the Vice Chairman and Housing Commissioner, A.P. Housing
Board to construct and allot individual flats to the 320 employees of
the Board who were earlier allotted individual plots and that the above
G.O. issued by the first respondent is arbitrary, illegal and is in
violation of the principles of natural justice.
26. It is further submitted that since the G.O.Ms.No.2 has been
acted upon a vested right has been created in favour of the members
of the Association. When once the G.O. has been accepted, it is not
open to the first respondent to cancel the same after a substantial
delay. It is further submitted that no notice has been issued and no
opportunity has been given to the members before passing the
impugned order.
HC, J & NVSK, J
27. It is submitted that when the Board is the ultimate authority to
fix the market value and the Government having delegated the power
to the Board to take decision in the matter through the letter dated
28.06.1994 thereafter, it is not open to the first respondent to pass
the impugned order after a decision has been taken by the Board.
Had the decision been taken by the first respondent in the year 1990
itself, the members would have purchased other plots or would have
applied in the open category for allotment of plots and that the
amount which is now being offered to the members of the petitioner-
Association cannot be a just compensation as it has no relevancy to
the present market value of the property.
28. The Government made the applicants to believe that it will allot
the land and the Housing Board will register the plots in their names
by collecting the amount fixed by the Government in 30 instalments
and the amount was also recovered by way of instalments, therefore,
the allottees developed a legitimate expectation. The Housing Board
as well as the Government made a promise by issuing G.Os. and by
collecting money towards the cost of the plots, therefore,
the doctrine of promissory estoppel will also come into operation and
the Government is estopped from taking back the promise made by it.
That apart, without any notice about the change of the scheme,
issuing G.O.Ms.No.32 is against the principles of natural justice and
arbitrary which is quite contrary to the promise made by the
Government and the earlier orders issued by the Government, HC, J & NVSK, J
therefore, G.O.Ms.No.32 is liable to be set aside and the respondents
shall be directed to register the plots in the names of the respective
applicants according to their category by collecting the difference of
development charges, if any, due from any of the allottees.
CONTENTIONS OF THE RESPONDENTS IN THE WRIT PETITIONS:
29. The first respondent filed a counter affidavit stating that the
A.P. Housing Board conducted a demand survey among the employees
who were appointed on or before 31.12.1984. In response to a
Circular issued, 320 applications were received from employees in
different categories. The A.P. Housing Board through the Resolution,
dated 29.07.1988 resolved to recommend to the Government to accord
permission for allotment of 320 sites. The Government issued
G.O.Ms.No.2, dated 10.01.1991 according permission as a special
case for allotment of house plots to 320 employees of the Housing
Board in an extent of 13 acres with certain conditions. After receipt of
the Government Orders, the drawal of the land was conducted and the
allotment proceedings were issued to the employees to pay cost of the
land and development charges at the rate of Rs.45/- per square yard.
As per the request of the NGOs union, the amount was collected in
30 monthly instalments from the salaries of the employees
commencing from August, 1991. While submitting the proposals to
the Government, the extent of allotted area was shown as 13 acres,
whereas the total area in the layout measured at 26.541 cents
including the area covered by the roads, parks, playgrounds etc., HC, J & NVSK, J
therefore, the matter was placed before the Board for consideration for
allotment of 26.541 acres. The Board in its 423rd meeting held on
29.06.1992 passed a Resolution to approach the Government for
necessary amendment to the G.O. by substituting 26.541 acres in the
place of 13 acres. The Government, vide its letter dated
28.06.1994 informed that the matter need not come to the
Government and that the Vice Chairman of the Housing Board may
take necessary action to decide at his level as the proposed land is
under the control of the Board. After receipt of the orders from the
Government, the matter was placed before the Board and the Board in
its 449th meeting held on 24.08.1995 resolved to amend the G.O. and
proposed to collect the amount at the rate of Rs.116/- per square yard
towards cost of the land including development charges.
But, the Resolution was not communicated to the employees and the
difference of amount was not collected since the lay out was under the
process of approval. When the minutes of the Board are
communicated, the Principal Secretary to the Housing Board directed
the Vice Chairman and Housing Commissioner not to register the
plots in Phase-IV in favour of the Housing Board employees in terms
of the Board Resolution till the Government issued clarification and
takes a clear decision on the issue. The Government in D.O. letter
informed the Vice Chairman that the plots at Kukatpally were sold at
Rs.80/- per square yard in the year 1983-84 and it was decided by the
Board to sell the land at Rs.116/- per square yard in 2001 when the
land auctioned by the Housing Board is fetching more than Rs.3000/-
HC, J & NVSK, J
per square yard, therefore, it is not appropriate to sell away
A.P. Housing Board lands at throw away prices. The matter has been
examined by the Government and it was tentatively decided to
constitute a cabinet sub committee to examine the issue and
appropriate orders would be issued after taking a decision in the
matter.
30. The counter affidavit filed by the respondents No.2 and 3 is also
on the similar lines and further pleaded that as the matter is under
the active consideration of the Government, the writ petitions are
premature and misconceived.
31. By taking into consideration, the subsequent developments and
filing of writ petitions in 2006 on fresh cause of action, the first
respondent filed counter by contending that the cabinet sub
committee recommended that the land already allotted to the
employees of the Housing Board may be registered at the rate of
Rs.204/- per square yard including the development charges as
approved by the A.P. Housing Board subject to the condition that if
any increase in developmental charge over and above Rs.204/-
per square yard arises at the time of execution, it is to be borne by the
employees themselves. The Council of Ministers has approved the
recommendations of the cabinet sub committee, through the
Resolution, dated 01.04.2005 by directing that the conditions
stipulated in G.O.Ms.No.244, Revenue (Assignment-I) Department,
dated 28.02.2005 is applicable to the case of Housing Board HC, J & NVSK, J
employees also. After Resolution of the cabinet sub committee,
the Government asked the Vice Chairman to submit necessary
proposals incorporating the conditions as per G.O.Ms.No.244 and the
Vice Chairman submitted the same in May, 2005.
32. While the matter stood thus, the Vice Chairman and Housing
Commissioner has submitted a revised proposal in December, 2005
with a request to cancel all the allotments and to provide houses in
the proposed Hydernagar scheme for the following reasons:
"1. Only 103 people have paid the full amount asked for and 217 people have not paid the full amount asked for;
2. Whereas the G.O. referred to in the cabinet decision relates to payment of market value as per the basic value, what has been collected from these employees are in the nature of only a fraction of market value such as Rs.5/- against market value of Rs.180/-;
3. Several people have bought by way of either concessional allotment of outright purchase flats.
4. Several people have retired in the meantime and died and some have been removed from the service;
5. To give semblance of fairness, we have sent proposals for Administering the scheme. But it appears that it is quite difficult to administer."
33. Thereafter, the Government examined the proposals of the Vice
Chairman-cum-Housing Commissioner and placed before the Council
of Ministers for approval. The Council of Ministers approved the HC, J & NVSK, J
revised proposal on 01.04.2005 by observing that the revised proposal
submitted by the second respondent is laudable and the same has
been examined and approved by the Government with reference to
various aspects by issuing G.O.Ms.No.32, dated 12.09.2006. There is
no discrimination or violation of Article 14 of the Constitution,
therefore, the first respondent requested to dismiss the writ petitions.
34. It is further submitted that it is important to know that 26 acres
of land was never cleared by the Government and it required the
approval of the Government before any kind of allotment could be
done and the original is modified and hence, the original approval of
the Government completely stood nullified in the background of the
revised proposal as well as Government order not to register the plots.
The Government, after due deliberations, thought it prudent to take it
to the cabinet for the withdrawal of the scheme without jeopardising
the interests of the employees by giving 20% interest on the amount
paid by them and also by giving plots at the cost of construction only
without charging for the land cost. On a letter addressed by the
Housing Board on 16.10.2000 for payment of the difference amount,
only 60 members paid the amount. It is submitted that it is incorrect
to state that the second respondent stopped receiving the amount on
the ground that the first respondent gave direction not to register the
plots in favour of the allottees and further submitted that the proposal
for allotment of lands in favour of the employees is contrary to the
provisions of A.P. Housing Board Act and the employees have no right HC, J & NVSK, J
for allotment of any such land from the Board. Since the Housing
Board took some steps for allotment of plots, it felt that the concerned
employees should not be deprived of the enjoyment of the house
property and it is with this avowed intention and object that the
Housing Board proposed to make alternative arrangements for its
employees and decided to charge the construction cost only without
charging any cost for the land. The interest of the parties would be
better served by implementing G.O.Ms.No.32 and the construction
would be taken up on a time bound framework.
35. The learned Advocate General representing the first respondent
submitted that the prayer in the writ petition is in the form of specific
relief and the writ cannot be maintained and the remedy to the
petitioners is in a civil Court, but not in a writ Court. He further
submitted that the action of the Government as well as the Housing
Board is not in consonance with the Act and the Rules, therefore,
the question of legality of the action of the respondent does not arise.
The Government issued the G.O. on the recommendation made by the
Housing Board by taking into consideration the value of the land,
the availability of the land, the extra land required for the purpose of
allotment of house sites to the applicants etc., therefore,
the Government took a policy decision that it would be appropriate if
the flats are constructed to the applicants at the actual cost without
charging anything for the land on which the flats are going to be
constructed and the Government have also decided to refund the HC, J & NVSK, J
amount paid by the respective members with 20% interest per annum
or it can also be adjusted towards part of the cost of the flats that are
going to be constructed, therefore, in either way, the petitioners were
not put to loss and that the Government has power to change its
policy from time to time to extend the benefit to the employees. He
further submitted that since the employees have no statutory right for
allotment of house plots, their contention that they are discriminated
while allotting plots to the similarly placed employees on the previous
occasions, therefore, it amounts to violation of Article 14 of the
Constitution of India is not tenable. He referred to certain provisions
of the Housing Board Act and submitted that the action of the
Government is within its domain and there is no illegality in issuing
G.O.Ms.No.32.
POINTS CONSIDERED IN THE IMPUGNED COMMON ORDER:
36. In the light of the contentions raised by both parties,
the following were the points made for consideration by the learned
Single Judge:
"1. Whether the prayer in the writ petition is in the form of specific relief and whether the writ petition is not maintainable under law?
2. Whether the action of the respondents in changing the scheme for allotment of house sites amounts to promissory estoppel? and whether the action of the Government in issuing G.O.Ms.No.32, dated 12-09-2006 is arbitrary, illegal and liable to be set aside?
HC, J & NVSK, J
3. Whether the Government is estopped from changing its scheme after making the applicants to believe that they get the lands in view of the completion of the formalities except the registration of the land?"
37. The learned Single Judge while answering the above points
considered the following judgments filed by the learned counsel for the
petitioners in support of their contentions:
38. In Aeronautics Employees Co-op. Housing Society Ltd. Vs.
The Govt. of A.P., Hyderabad and others 1, this High Court while
considering the scope of doctrine of promissory estoppel held as
follows:
"The doctrine of promissory estoppel applies also against the Government. It is no defence for the Government to say that because of executive necessity, it need not keep up its promise.
Where the State Govt. promised assignment of land for house sites for the employees of a Central Govt. undertaking when vast tracts of land was readily available for construction purposes and, at the instance of the State Govt., the employees in question formed themselves into a Co-operative society, resiling from the promise towards the last stage after a long lapse of about eight years, on the ground that its own employees should be given preference, was unreasonable. Apart from the principle of promissory estoppel, in the interests of good Government the commitment made to the management of the undertaking should be honoured.
AIR 1990 AP 331 HC, J & NVSK, J
Had the State Government told the management of the undertaking in the beginning itself when vast tracts of land was readily available for construction purposes, the management would have explored alternative arrangements to provide housing accommodation to their employees. Because of the promise made by the State Government, the management, thinking that the promise would be acted upon, did not explore other possibilities. It is the promise of the government that had altered the position of the society.
The employees of any Central Government public sector undertaking, after having been promised assignment of land, should not be subjected to disappointment on the ground of the policy of the Government that the State Government employees should be given preference in the matter of assignment of house sites. Apart from the legality of the Governmental action, its legitimacy also is involved in a situation of the present type."
39. In M.P.Sugar Mills Vs. State of U.P. 2, the Supreme Court held
as follows:
"Where the Government makes a promise knowing or intending that it would be acted on by the promisee and, in fact, the promisee, acting in reliance on it, alters his position, the Government would be held bound by the promise and the promise would be enforceable against the Government at the instance of the promisee, notwithstanding that there is no consideration for the promise and the promise is not recorded in the form of a formal contract as required by Article 299 of the Constitution. It is elementary that in
AIR 1979 SC 621 HC, J & NVSK, J
a republic governed by the rule of law, no one, howsoever high or low, is above the law. Every one is subject to the law as fuly and completely as any other and the Government is no exception. It is indeed the pride of constitutional democracy and rule of law that the Government stands on the same footing as a private individual so far as the obligation of the law is concerned, the former is equaly bound as the latter. The Government cannot claim to be immune from the applicability of the rule of promissory estoppel and repudiate a promise made by it on the ground that such promise may fetter its future executive action. If the Government does not want its freedom of executive action to be hampered or restricted, the Government need not make a promise knowing or intending that it would be acted on by the promisee and the promisee would alter his position relying upon it. But if the Government makes such a promise and the promisee acts in reliance upon it and alters his position, there is no reason why the Government should not be compeled to make good such promise like any other private individual."
40. In F.C.I. Vs. Kamdhenu Cattle Feed Industries 3, the Supreme
Court, while dealing with the aspect of the legitimate expectation, held
as follows:
"Though the first part of the submission of the respondent is correct but the proposition enunciated by the High Court which forms the sole basis of its decision is too wide to be acceptable and has to be limited in the manner indicated hereafter.
(1993) 1 SCC 71 HC, J & NVSK, J
In contractual sphere as in al other State actions, the State and al its instrumentalities have to conform to Article 14 of which non-arbitrariness is a significant facet. There is no unfettered discretion in public law: A public authority possesses powers only to use them for public good. This imposes the duty to act fairly and to adopt a procedure, which is 'fairplay in action'. Due observance of this obligation as a part of good administration raises a reasonable or legitimate expectation in every citizen to be treated fairly in his interaction with the State and its instrumentalities, with this element forming a necessary component of the decision making process in al State actions. To satisfy this requirement of non-arbitrariness in a State action, it is, therefore, necessary to consider and give due weight to the reasonable or legitimate expectations of the persons likely to be affected by the decision or else that unfairness in the exercise of the power may amount to an abuse or excess of power apart from affecting the bona fides of the decision in a given case. The decision so made would be exposed to chalenge on the ground of arbitrariness. Rule of law does not completely eliminate discretion in the exercise of power, as it is unrealistic, but provides for control of its exercise by judicial review.
The mere reasonable or legitimate expectation of a citizen, in such a situation, may not by itself by a distinct enforceable right, but failure to consider and give due weight to it may render the decision arbitrary, and this is how the requirement of due consideration of a legitimate expectation forms part of the principle of non-arbitrariness, a necessary concomitant of the rule of law. Every legitimate expectation is a relevant factor requiring due consideration in a fair decision making process. Whether the expectation of the claimant is HC, J & NVSK, J
reasonable or legitimate in the context is a question of fact in each case. Whenever the question arises, it is to be determined not according to the claimant's perception but in larger public interest wherein other more important considerations may outweigh what would otherwise have been the legitimate expectation of the claimant. A bona fide decision of the public authority reached in this manner would satisfy the requirement of non-arbitrariness and withstand judicial scrutiny. The doctrine of legitimate expectation gets assimilated in the rule of law and operates in our legal system in this manner and to this extent."
41. In Council of Civil Service Unions V. Minister for the Civil
Service 4, the House of Lords indicated the extent to which the
legitimate expectation interfaces with exercise of discretionary power.
The impugned action was upheld as reasonable, made on due
consideration of all relevant factors including the legitimate
expectation of the applicant, wherein the considerations of national
security were found to outweigh that which otherwise would have
been the reasonable expectation of the applicant. Lord Scarman
pointed out that "the controlling factor in determining whether the
exercise of prerogative power is subject to judicial review is not its
source but its subject matter". Again in Preston, in re 5 it was stated
by Lord Scarman that "the principle of fairness has an important
place in the law of judicial review" and "unfairness in the purported
exercise of a power can be such that it is an abuse or excess of
(1984) 3 AII ER 935 (HL)
(1985) 2 AII ER 327 HC, J & NVSK, J
power". These decisions of the House of Lords give a similar indication
of the significance of the doctrine of legitimate expectation.
42. In Shanti Vijay and Co. Vs. Princess Fatima Fouzia 6 , it is
held that court should interfere where discretionary power is not
exercised reasonable and in good faith.
43. In Union of India Vs. International Trading Co. 7,
the Supreme Court held as follows:
"Though there can be quarrel with the proposition that renewal of a permit carries with it a valuable right, but undisputedly, for outweighing reasons of public interest, renewal can be refused. If at the time when the matter is taken up for considering whether renewal is to be granted, there is a change in policy it cannot be said that the right is defeated by introduction of a policy. In such an event, the question of applying the doctrine of legitimate expectation or promissory estoppel loses significance. It has not been disputed that in fact the policy decision exists. Legitimacy of the policy decision has not been questioned by the respondents. Doctrines of promissory estoppel and legitimate expectation cannot come in the way of public interest, which has to prevail over private interest. The case at hand shows that a conscious policy decision had been taken and there was no statutory compulsion to act to the contrary. In that context, it cannot be said that the respondents have acquired any right for renewal. The High Court was not justified in observing that the policy decision was contrary to the statute and for that reason direction for
(1979) 4 SCC 602
(2003) 5 SCC 437 HC, J & NVSK, J
consideration of the application for renewal was necessary. Had the High Court not recorded any finding on the merits of respective stands, direction for consideration in accordance with law would have been proper and there would not have been any difficulty in accepting the plea of the counsel for the respondents. But having practicaly foreclosed any consideration by the findings recorded, consideration of the application would have been a mere formality and grant of renewal would have been the inevitable result, though it may be against the policy decision. That renders the High Court judgment indefensible.
A claim based on merely legitimate expectation without anything more cannot ipso facto give a right. For legal purposes, expectation is not the same as anticipation. Legitimacy of an expectation can be inferred only if it is founded on the sanction of law.
Even if it is accepted that there was any improper permission, that may render such permissions vulnerable so far as the thirty-two vessels are concerned, but it cannot come to the aid of the respondents. Two wrongs do not make a right. A party cannot claim that since something wrong has been done in another case; direction should be given for doing another wrong. It would not be setting a wrong right, but would be perpetuating another wrong. In such matters there is no discrimination involved. The concept of equal treatment on the logic of Article 14 of the Constitution cannot be pressed into service in such cases. What the concept of equal treatment presupposes is existence of similar legal foothold. It does not countenance repletion of a wrong action to bring both wrongs on a par. Even if hypotheticaly it is accepted that a wrong has been committed in some other cases by introducing a concept of negative HC, J & NVSK, J
equality the respondents cannot strengthen their case. They have to establish strength of their case on some other basis and not by claiming negative equality.
Article 14 of the Constitution applies also to mattes of governmental policy and if the policy or any action of the Government, even in contractual matters, fails to satisfy the test of reasonableness, it would be unconstitutional. While the discretion to change the policy in exercise of the executive power, when no trammeled by any statute or rule is wide enough, what is imperative and implicit in terms of Article 14 is that a change in policy must be made fairly and should not give the impression that it was so done arbitrarily or by any ulterior criteria. The wide sweep of Article 14 and the requirement of every State action qualifying for its validity on this touchstone irrespective of the field of activity of the State is an accepted tenet. The basic requirement of Article 14 is fairness in action by the State, and non-arbitrariness in essence and substance is the heartbeat of fair play. Actions are amenable, in the panorama of judicial review only to the extent that the State must act validly for a discernible reason, not whimsicaly for any ulterior purpose. The meaning and true import and concept of arbitrariness is more easily visualized than precisely defined. A question whether the impugned action is arbitrary or not is to be ultimately answered on the facts and circumstances of a given case. A basic and obvious test to apply in such cases is to see whether there is any discernible principle emerging from the impugned action and if so, does it realy satisfy the test of reasonableness. Where a particular mode is prescribed for doing an act and there is no impediment in adopting the procedure, the deviation to act in a different manner which does not disclose any discernible principle which is reasonable HC, J & NVSK, J
itself shal be labeled as arbitrary. Every State action must be informed by reason and it folows that an act uninformed by reason is per se arbitrary.
If the State acts within the bounds of reasonableness, it would be legitimate to take into consideration the national priorities and adopt trade policies. The ultimate test is whether on the touchstone of reasonableness the policy decision comes out unscathed. Reasonableness of restriction is to be determined in an objective manner and from the standpoint of interests of the general public and not from the standpoint of the interests of persons upon whom the restrictions have been imposed or upon abstract consideration. A restriction cannot be said to be unreasonable merely because in a given case, it operates harshly. In determining whether there is any unfairness involved; the nature of the right aleged to have been infringed, the underlying purpose of the restriction imposed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing condition at the relevant time, enter into judicial verdict. The reasonableness of the legitimate expectation has to be determined with respect to the circumstances relating to the trade or business in question. Canalisation of a particular business in favour of even a specified individual is reasonable where the interests of the country are concerned or where the business affects the economy of the country."
44. After going through the said judgments, the learned Single
Judge held that in the present case, the respondents made up their
mind to give plots to the petitioners and 103 people have admittedly
paid the full amount as required by the Housing Board. Just before HC, J & NVSK, J
the registration of the sale deeds, it struck to the respondents that
they cannot lose the valuable land for the sake of employees and due
to delay there is a hike in the prices. It is nothing but normal that
prices continue to increase and when delay is caused in taking
decision, it pricks the mind of the officers that they were giving away
the lands for paltry amount, when the prevailing rates are very high.
However, the officers failed to take note of the fact that the
Government fixed the rate by taking into consideration the then
prevailing rates as on the date of taking decision. If the decision is
implemented immediately, the properties would have been registered
in the names of the respective applicants without the problem of
comparing the rates prevailing then and the present. On account of
delay in decision making, the applicants shall not be made to suffer,
at least those who scrupulously followed the instructions of the
respondents and parted with the money as required by the
respondents. The Board has favourably considered the representation
of a new set of employees for similar benefit of allotment of lands.
Had the Board felt that there is no statutory right, it would have
outright rejected the application by saying that the Board is not
inclined to recommend to the Government for allotment of house sites
to the employees. Having recommended favourably, having obtained
the G.O. from the Government for allotment of the lands, having fixed
the rate and having collected the amount by deducting the
instalments from the salary of the respective applicants, it is not just
and proper on the part of the respondents to go back by taking an HC, J & NVSK, J
excuse that the applicants have no right under the statute for
allotment of the land.
45. The learned Single Judge has also noted the submissions of the
learned Advocate General that the prayer in these writ petitions is in
the form of specific relief, therefore, it is for the petitioners to
approach the civil Court for appropriate remedy and the writ petitions
cannot be maintained. In this regard, the learned Single Judge has
observed that G.O. Ms. No.32, dated 12.09.2006 was questioned on
the ground of arbitrariness on the part of the Government as it was
issued solely on the ground that the land will fetch more value if it is
sold in the open market, unmindful of the sequence of events that
went to the extent of registration of plots in favour of the petitioners
after complying all the formalities including recovery of sale
consideration as fixed by the Government. Since the board took a
decision to allot plots to its employees, after obtaining permission
from the Government to sell the land as per the price fixed by the
Government, and when the G.O. was issued authorizing the Board to
execute the sale deeds, nothing remained to be in force by way of
specific performance, therefore, the learned Single Judge did not agree
with the contention of the learned Advocate General that the relief
sought for is in the form of specific relief.
46. Regarding the point whether the action of the respondents in
changing the scheme for allotment of house sites amounts to
promissory estoppel, the leaned Single Judge has observed that the HC, J & NVSK, J
respondents having made all arrangements for registration of the sale
deeds in favour of the petitioners, are estopped from saying that there
is no statutory right to the petitioners and that the Government will
be put to loss and the land can be utilized for some other purpose.
After considering the above aspects, the learned Single Judge has
come to a conclusion that G.O. Ms. No.32, dated 12.09.2006 is
arbitrary to the extent of 103 applicants, who have paid the full
amount as required by the respondents and quashed the G.O. Ms.
No.32 dated 12.09.2006 in part to the extent of the eligible applicants,
who have paid the entire amount as required by the respondents and
the rest of the G.O. was held valid in respect of the applicants,
who are about 217 in number, who failed to pay the full amount as
prescribed by the respondents. Eventually, the learned Single Judge
has held as under:
"In the result, the Writ Petitions are allowed in part by quashing G.O.Ms.No.32, dated 12-09-2006 to the extent of cancellation of allotment of plots in respect of the applicants, who paid the full amount as required by the respondents. The respondents are directed to register the plots in favour of the petitioners, who have paid the entire amount as prescribed by the respondents in G.O.Ms.No.2, dated 10-01-1991 and deliver possession of the respective plots or such other plots, which are situated contiguously by collecting such development and other charges as is required by the respondents on account of the amount spent for the development of the land. The option is left to the Government to continue the G.O.Ms.No.32 dated 12- 09-2006 in force in respect of other applicants, who HC, J & NVSK, J
paid the amounts in part or failed to pay any amount, who are said to be 217 in number, by leaving the option to such petitioners either to go for purchase of the flats as mentioned in the G.O. or take the refund of the respective amounts with interest as mentioned in the impugned G.O. No order as to costs"
CONTENTIONS OF THE APPELLANTS/ALLOTTEES:
47. The learned Senior Counsel Mr. D.Prakash Reddy, representing
Ms. Divya Adepu, learned counsel for the appellants in W.A. Nos.43,
120, 121, 181, 182 and 183 of 2009 and respondent Nos.2 and 3 in
W.A. No.131 of 2009, would submit that the G.O. Ms. No.2, dated
10.01.1991 was issued after considering the representations from the
employees of the 2nd respondent Board to allot plots to 320 eligible
employees in Phase IV Kukatpally at the rate of Rs.45/- per square
yard and accordingly all the 320 employees of the 2nd respondent have
paid the amount by way of recovery made by the 2nd respondent from
their salaries. Therefore, all the 320 allottees are standing on equal
footing and there cannot be any discrimination in extending the
benefits in pursuance of G.O. Ms. No.2, dated 10.01.1991 and on any
consequential decisions of the respondents to register their respective
plots in their favour. He would further submit that the Board in its
449th meeting held on 24.08.1995 resolved to allot Acs.26.541 of land
to the employees of the Board at the rate of Rs.116/- per square yard
against Rs.45/- and also recovered the same from the employees.
Thereafter, in view of the directions of the 1st respondent, Principal
Secretary, not to register the plots in favour of the allottees and not to HC, J & NVSK, J
proceed further in the matter, the 2nd respondent, Housing Board,
stopped receiving the enhanced amount of the plot cost and
development charges at the rate of Rs.116/- from the rest of the
allottees, therefore, it cannot be said that the 217 allottees/employees
failed to pay the enhanced amount at the rate of Rs.116/-.
48. He would further submits that the learned Single Judge has
committed an error in differentiating the allottees into two categories
as the 103 applicants fully paid the money at the rate of Rs.116/-
per square yard and 217 applicants failed to pay the full amount as
prescribed by the respondents. In fact, the amount of Rs.116/-
per square yard is not a final amount but subsequently the
Sub Committee and the respondents have decided to collect at the
rate of Rs.204/- per square yard and all the 320 allottees are yet to
pay the amount at the rate of Rs.204/- per square yard.
49. Eventually, he submitted that the impugned G.O. Ms. No.32
dated 12.09.2006 issued by the 1st respondent is arbitrary, illegal and
in violation of principles of natural justice in view of the fact that the
G.O. Ms. No.2, dated 10.01.1991 has been acted upon and rights in
favour of the members of the Society is vested and once the G.O. Ms.
No.2 has been acted, it is not open for the 1st respondent to cancel the
same at the length of time. Apart from that no notice has been issued
and no opportunity has been given to the members before passing the
impugned G.O.
HC, J & NVSK, J
50. He would further submits that since the petitioners are not the
defaulters and the impugned order is arbitrary and had created an
artificial dichotomy in respect of the applicants who paid full amount
as prescribed by the respondents and leaving the option to the
Government to continue G.O. Ms. No.32, dated 12.09.2006 in respect
of other applicants comprising of 217 members who paid the amount
in part or failed to pay any amount leaving it open to the petitioners
either to go for purchase of the flats or take refund with interest.
Further he would submit that 217 persons have, in fact, paid the
amounts as per G.O. Ms. No.2 and the land to individual members
was not increased and the 26 acres was required only to accommodate
the roads and other amenities.
51. It is further contended that there is no intelligible differentia in
segregation the 103 and 217 employees with regard to the quashment
of G.O.Ms. No.32 only to the extent of 103 employees and as per the
G.O.Ms. No.2, all the employees have paid the amount. Deductions
have been made from the salaries of the employees to the
2nd respondent and that 217 employees could not pay the difference
amount of Rs.71/- per square yard in pursuance to the Principal
Secretary Order dated 06.04.2001 to stop APHB from further action
on the Board's decision dated 29.11.2000. There was no last date
payment of difference of amount mentioned in the letter dated
16.12.2000. The rate paid by the 103 employees i.e. Rs.116/-
per square yard is not final and as per letter dated 14.12.2001 and HC, J & NVSK, J
the new estimate price was worked out to be Rs.204/- per square
yard.
52. He would further submit that subsequent to the filing of the writ
appeals some of the allottees have died, which would not preclude the
interest of the successors of the allottees and that the legal
representatives would also get the benefit of the allotments and
submit that the appeals be allowed.
53. The learned Senior Counsel Mr. L.Ravi Chander, representing
Mr. K.R. Prabhakar, learned counsel for the appellant in W.A. No.474
of 2009 and respondent No.3 in W.A. No.139 of 2009, had advanced
his arguments similar to that of the submissions made by the learned
Senior Counsel Mr. D.Prakash Reddy. In addition, he would submit
that the action of the respondents in issuing G.O. Ms. No.32 is
arbitrary and contrary to the principles of promissory estoppel and
therefore, the learned Single Judge ought to have allowed the writ
petition in entirety and as there cannot be any severability or different
treatment among all the allottees. He would further submits that it is
not the case of the 2nd respondent Board that the appellant and
similarly situated candidates were in default of the entire sale
consideration. He would further submit that the circumstances and
the developments in the case specifically after the year 2000 explicit
that the respondents have changed their mind and decided to go back
from their promise to allot plots to the allottees and therefore they
have not collected further amounts, for which they should not HC, J & NVSK, J
penalise the appellant and the similarly situated candidates, who are
not at fault.
54. The learned Senior Counsel drawn the attention of this Court to
the reports dated 06.06.2018 and 15.03.2013 submitted by the Board
to the Government and he also drawn the attention of this Court to
the correspondence/communication by the Vice Chairman and
Housing Commissioner dated 15.02.2021 to the Executive Engineer,
Western Division, APHB, respectively, which are extracted hereunder:
Lr. No.1574/EE(WD)/2003, dated 06.06.2018:
".... In view of the circumstances explained above, Government may be pleased to take suitable decision on the request of the Employees for physical possession as provided in the Board Act for allotment of plots rules confirmed (1977) under rule No.11, 14(2) at P.320/321 and to register the plots, considering that all the allottees have paid the amount as prescribed in G.O. Ms. No.2 Housing Dated: 10-01-1991 i.e., Rs.45 per square yard which is more than the enhanced land cost of Rs.16 per square yard. The difference amount between actual development cost and cost already paid after adjustment of Rs.16 per square yard towards land cost may be collected before registration of plots as per the procedure in vogue."
Lr. No.1574/EE(WD)/2003, dated 15.03.2013:
".... In view of the above the Govt. is requested to issue necessary orders to withdraw the Writ appeals as filed in the Hon'ble High Court, since all the 320 employees have paid more than the land cost of Rs.16/- long back as per Board resolution dt.19.11.2000, to ask HC, J & NVSK, J
all the 320 employees to pay the difference of balance development cost which may be calculated as per the present estimates to get their plots registered in their favour. Therefore, the Government is requested to take early decision in the matter please."
Note No.VC&HC/APHB/2001, Dated: 15.02.2001:
".... Please refer to the Board resolution, Dated Jan 29, 2001. With regard to the registration of plots in the name of the Board employees, the Prl.Secretary to Government, Housing Department, has talked to me over telephone, that the matter is under examination of the Government.
I, therefore, request you to see that no further action is taken until further orders in this regard."
55. The above referred reports/communication are self explanatory
in support of the allottees.
56. It is further submitted that though it is impermissible for the
respondent Board to revise the cost of the land having collected entire
amount of Rs.45/- per square yard by recovering the same from the
salaries of all the 320 allottees, all the 320 allottees have expressed
their readiness and willingness to pay the differential amount and in
fact some of the applicants out of 320 have paid the differential
amount and some of the allottees did not receive any notice from the
respondent Board directing them to pay the differential amount.
Having known such notices were sent by the Board to some of the
allottees, other allottees have approached the authorities to pay the HC, J & NVSK, J
differential amount but the respondent Board did not receive the
differential amount from them in view of the telephonic instructions
issued by the Principal Secretary to Government as reflected in the
orders of the respondent Board vide Note dated 15.02.2021.
57. He would further submit that after issuance of G.O. Ms. No.2
and having collected the amounts from all the 320 allottees,
Government is propounding new theory of public interest which has
been subsequently created and such pleadings cannot improve the
case of the respondents. He would further submit that in the G.O.
Ms. No.32 there was no reference to G.O. Ms. No.244, dated
28.02.2005. He would further submit that the entire action of the
respondents in depriving the rights of the petitioners is totally
arbitrary, misconceived and that the respondents failed to act upon
their own action.
58. Eventually, in support of his submissions, he placed reliance in
the case of Opto Circuit India Limited Vs. Axis Bank and others 8
at para 12, which reads as under:
12. The action sought to be sustained should be with reference to the contents of the impugned order/communication and the same cannot be justified by improving the same through the contention raised in the objection statement or affidavit filed before the Court. This has been succinctly laid down by this Court in Mohinder Singh Gill v. Chief Election
(2021) 6 Supreme Court Cases 707 HC, J & NVSK, J
Commr. [Mohinder Singh Gill v. Chief Election Commr., (1978) 1 SCC 405] as follows : (SCC p. 417, para 8)
"8. The second equally relevant matter is that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise, an order bad in the beginning may, by the time it comes to court on account of a challenge, gets validated by additional grounds later brought out. We may here draw attention to the observations of Bose, J. in Gordhandas Bhanji [Commr. of Police v. Gordhandas Bhanji, 1951 SCC 1088] :
(SCC p. 1095, para 9)
'9. ... public orders, publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind, or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the actings and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself.'
Orders are not like old wine becoming better as they grow older."
In fact, in the instant case such contention of having exercised power under Section 102 CrPC has not been put forth even in the counter-affidavit, either in this appeal or before the High Court and has only been the attempted ingenuity of the learned Additional Solicitor General. Such contention, therefore, cannot be accepted. In fact, in the objection statement filed before HC, J & NVSK, J
the High Court much emphasis has been laid on the power available under the PMLA and the same being exercised though without specifically referring to the power available under Section 17 of the PMLA."
59. The learned Senior Counsel also placed reliance in the case of
Madhu Koneru and others Vs. The Directorate of Enforcement
and others 9 and the relevant para 76 reads as under:
"76. At this stage, we may remind ourselves of the famous Observations Of Vivian Bose, J in Commissioner of Police v. Gordhandas Bhanji MANU/SC/0002/1951 : AIR 1952 SC 16. He had said that public orders, publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind, or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the acting and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself. This salutary principle was reiterated and re-stated with great emphasis by a Constitution Bench of the Supreme Court in Mohinder Singh Gill (supra). Supreme Court held that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. If that is allowed, an order bad in the beginning may, by the time it comes to the Court on account of a challenge, gets validated by additional grounds later brought out. It was succinctly put that
MANU/TL/1455/2022 HC, J & NVSK, J
'orders are not like old wine becoming better as they grow older'."
60. The learned Senior Counsel Mr. O.Manohar Reddy, appearing for
the appellant, Housing Board Employees IV-Phase Plot Allottees
Welfare Association, in W.A. No.525 of 2009 and also for the
respondent No.1 in W.A. Nos.367 and 372 of 2009, had also advanced
his arguments similar to that of the submissions made by the learned
Senior Counsel Mr. D.Prakash Reddy and Mr. L.Ravi Chander.
That apart, he would submit that the resolution of the Board dated
29.11.2000 and the subsequent letter dated 16.12.2000 was issued
only to some of the employees and the said resolution also does not fix
any period for payment of the enhanced development charges and in
the absence of fixing any period for payment of the development
charges as fixed subsequently by the Board, it cannot be held that the
members of the appellant association have failed to pay the amount.
Further, the letter issued by the Board dated 29.11.2000 was kept in
abeyance by the Government itself in April, 2001 and the Board has
stopped collecting the amounts even though the members of the
appellant association were ready to pay the amount. Since all the
members of the appellant association have paid the consideration and
individual plots have been allotted in their favour as such the learned
Single Judge ought to have held that the plea of promissory estoppel
would apply to all members of the appellant association.
HC, J & NVSK, J
61. He would further submits that the employees are entitled to the
benefit of doctrine of substantive legitimate expectation. In support of
his contentions, he placed reliance on the judgment rendered by the
Hon'ble Supreme Court in the case of Sivanandan C.T. and others
Vs. High Court of Kerala and others 10 and the relevant para 29 is
reproduced hereunder:
"29. A claim based on the doctrine of procedural legitimate expectation arises where a claimant expects the public authority to follow a particular procedure before taking a decision. This is in contradistinction to the doctrine of substantive legitimate expectation where a claimant expects conferral of a substantive benefit based on the existing promise or practice of the public authority. The doctrine of substantive legitimate expectation has now been accepted as an integral part of both the common law as well as Indian jurisprudence."
62. On the other hand, the learned Special Government Pleader
Mr. Harender Pershad appearing for the appellants, State of
Telangana, in W.A. Nos.131, 139, 367 and 372 of 2009, would submit
that the learned Single Judge has committed an error in quashing the
G.O. Ms. No.32, dated 12.09.2006 to the extent of cancellation of
allotment of plots in respect of the applicants inasmuch as neither the
applicants concerned were before this Court on their own nor did they
seek for quashing of G.O. Ms. No.32. He would further submits that
the principle of promissory estoppel has no application having regard
2023 SCC OnLine SC 994 HC, J & NVSK, J
to the facts in the instant case. He further submitted that the
petitioners were virtually seeking for the relief of specific performance,
which is purely a discretionary relief and as such could not have been
allowed. It is further contended that the learned Single Judge has
committed an error in coming to a conclusion that the petitioners
fulfilled all the conditions and that they legitimately expect that they
would get benefit inasmuch as there is no factual background/
pleading in this regard. He would further submit that any practice
which is not sanctioned by law cannot be sought to be enforced by
way of a writ petition by invoking the jurisdiction under Article 226 of
the Constitution of India.
63. It is further contended that the action of the Government as well
as the Housing Board is not in consonance with the Act and the Rules
therefore, the question of legality of the action of the respondent does
not arise. The Government issued the G.O. on the recommendation
made by the Housing Board by taking into consideration the value of
the land, the availability of the land, the extra land required for the
purpose of allotment of house sites to the applicants etc., therefore,
the Government took a policy decision that it would be appropriate if
the flats are constructed to the applicants at the actual cost without
charging anything for the land on which the flats are going to be
constructed and the Government have also decided to refund the
amount paid by the respective members with 20% interest per annum
or it can also be adjusted towards part of the cost of the flats that are HC, J & NVSK, J
going to be constructed, therefore, in either way, the petitioners were
not put to loss and the Government have power to change its policy
from time to time to extend the benefit to the employees. He further
contended that the employees have no statutory right for allotment of
house plots.
64. It is further submitted that an expectation entertained by a
person may not be found to be legitimate due to the existence of some
countervailing consideration of policy or law. Administrative policies
may change with changing circumstances, including changes in the
political complexion of Governments. The liberty to make such
changes is something that is inherent in our constitutional form of
Government. It is further submitted that so long as the Government
does not act in an arbitrary or in an unreasonable manner,
the change in policy does not call for interference by judicial review on
the ground of a legitimate expectation of an individual or a group of
individuals being defeated. In support of his contentions, he placed
reliance in the case of Kerala State Beverages (M and M)
Corporation Limited Vs. P.P. Suresh and others 11 and the relevant
paras from 19 to 21 are extracted hereunder:
"Substantive Legitimate Expectation
19. An expectation entertained by a person may not be found to be legitimate due to the existence of some countervailing consideration of policy or law. [ H.W.R.
Wade & C.F. Forsyth, Administrative Law (Eleventh
(2019) 9 Supreme Court Cases 710 HC, J & NVSK, J
Edn., Oxford University Press, 2014).] Administrative policies may change with changing circumstances, including changes in the political complexion of Governments. The liberty to make such changes is something that is inherent in our constitutional form of Government. [Hughes v. Department of Health and Social Security, 1985 AC 776, 788 : (1985) 2 WLR 866 (HL)]
20. The decision-makers' freedom to change the policy in public interest cannot be fettered by applying the principle of substantive legitimate expectation. [Findlay, In re, 1985 AC 318 : (1984) 3 WLR 1159 : (1984) 3 All ER 801 (HL)] So long as the Government does not act in an arbitrary or in an unreasonable manner, the change in policy does not call for interference by judicial review on the ground of a legitimate expectation of an individual or a group of individuals being defeated.
21. The assurance given to the respondents that they would be considered for appointment in the future vacancies of daily wage workers, according to the respondents, gives rise to a claim of legitimate expectation. The respondents contend that there is no valid reason for the Government to resile from the promise made to them. We are in agreement with the explanation given by the State Government that the change in policy due was to the difficulty in implementation of the Government Order dated 20-2-2002. Due deference has to be given to the discretion exercised by the State Government. As the decision of the Government to change the policy was to balance the interests of the displaced abkari workers and a large number of unemployed youth in the State of Kerala, the decision taken on 7-8-2004 cannot be said to be contrary to public interest. We are convinced that HC, J & NVSK, J
the overriding public interest which was the reason for change in policy has to be given due weight while considering the claim of the respondents regarding legitimate expectation. We hold that the expectation of the respondents for consideration against the 25% of the future vacancies in daily wage workers in the Corporation is not legitimate."
ANALYSIS/OBSERVATIONS:
65. For better appreciation, it is necessary and essential to excerpt
the G.O. Ms. No.2, dated 10.01.1991 and G.O. Ms. No.32, dated
12.09.2006.
"GOVERNMENT OF ANDHRA PRADESH ANDHRA PRADESH ABSTRACT Andhra Pradesh Housing Board - Allotment of Plots to the staff of Andhra Pradesh Housing Board at "Kukatpally" - Orders - Issued. __________________________________________________ HOUSING DEPARTMENT
G.O.Ms.No.2 Housing Dt.10.01.91 Read the following:
1) From VC&Hg.Commissioner, A.P. Housing Board, Lr.No.19407/D16/80 dt.30.3.89.
2) From the VC&Hg.Commissioner, A.P.Housing Board, Lr.No.19407/D16/86 dt.21.8.89.
ORDER The Vice Chairman & Housing Commissioner, Andhra Pradesh Housing Board in his letter first cited above has stated that the NGOs union of the Andhra Pradesh Housing Board represented to categories to whom the plots were not allotted and requested for allotment of developed plot on the same anology as was allotted to the Board employee earlier. The Vice Chairman and Housing Commissioner, Andhra Pradesh Housing Board has further stated, that the Board in its meeting held on 29.7.88 resolved to recommend to Government for according permission to allot 115 MIG, 181 LIG and 24 EWS plots to the 320 Board employees to an extent of 13.00 acres of land at "Kukatpally" at the rate including HC, J & NVSK, J
the cost of land and developmental charges subject to condition that no employee shall sell away the land and if there is any violation, the land with a structure if any, will be resumed by the Government.
2. The Government have considered the above request of the Andhra Pradesh Housing Board and hereby accord permission for allotment of 115 MIG, 181 LIG and 24 EWS plots to 320 employees of Andhra Pradesh Housing Board in an extent of Acs.13.00 on the Southern side of 4th phase situated at "Kukatpally" Hyderabad at the rate of Rs.45/- per sq. yd. subject to the condition that no board employee shall sell away or exchange or mortgage the plot and subject also to the condition that the plots with structure if any, will be resumed by the Government at any time for any violation of rules or orders of allotment.
3. The Vice Chairman and Housing Commissioner, A.P. Housing Board is requested to take action.
(BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH)
Smt.Rachel Chatterjee Secretary to Government"
--------------------------------------------------------------------------------------
"GOVERNMENT OF ANDHRA PRADESH ANDHRA PRADESH ABSTRACT Housing Board - Andhra Pradesh Housing Board (APHB) - Permission accorded for allotment of 320 plots to the employees of APHB - Cancellation of the permission accorded - Orders - Issued. __________________________________________________ HOUSING (HB.II) DEPARTMENT
G.O.Ms.No.32 Housing Dt.12.09.2006 Read the following:
1) G.O.Ms.No.2, Housing Department, dt.10.1.1991
2) From VC&HC, APHB, Lr.No.6571/B5/2002, dt.9.5.2005.
3) From the VC & HC, APHB, Note dt.17.2.2005.
ORDER
Government, after careful examination of the proposals received in the references 2nd and 3rd read above from the Vice Chairman and Housing Commissioner, A.P.Housing Board, hereby cancel the orders already issued in the reference 1st read above.
HC, J & NVSK, J
Government hereby permit the Vice Chairman and Housing Commissioner, A.P.Housing Board to construct and allot individual flats to the 320 employees of the A.P.Housing Board who were earlier allotted 115 MIG, 181 LIG and 24 EWS individual plots in the land situated on the Southern side of the IV phase at Kukatpally, Hyderabad subject to the following conditions:
i. Permission is accorded to the Vice Chairman and Housing Commissioner, A.P.Housing Board for the construction of individual flats (HIG/MIG/LIG) for the employees appropriate to their category at the time of the service which will be allotted at current rates of construction without charging them the land cost.
ii. Interest @ 20% per annum will paid by the A.P.Housing Board on the amount paid by the employees initially towards the land cost, if any, which will be offset against the cost of the construction at the current rates to be charged to them.
iii. Approval of the A.P.Housing Board shall be obtained by the Vice Chairman and Housing Commissioner, A.P.Housing Board of the above new scheme before its implementation.
(BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH)
A.K.Parida Principal Secretary to Government"
66. Admittedly, it is not in dispute that based on the representation
of the NGO Union of A.P. Housing Board and the recommendation
made by the Board to the Government, the Government had issued
G.O. Ms. No.2, dated 10.01.1991 allotting individual plots to 320
employees at the rate of Rs.45/- per square yard on the Southern side
of Phase IV of Kukatpally. Thereafter, individual allotment letters with
plot numbers and its area were issued by the Board to all the 320
employees vide letter dated 04.06.1991. As per the directions of the HC, J & NVSK, J
Vice Chairman and Housing Commissioner vide circular dated
09.09.1991 all the 320 employees have paid the price of the land as
per the G.O. Ms. No.2 from their salary deductions.
67. Thereafter, the Board by its resolution dated 29.06.1992
approached the Government for necessary amendment to the G.O. Ms.
No.2 for substitution of 26.451 acres in place of 13 acres for the
proposed layout and the Government vide its letter dated 28.06.1994
delegated the authority to the Board to take decision as the proposed
land is under the control of the Board and accordingly, the Board has
resolved on 24.08.1995 to allot Acs.26.541 of land to the employees of
the Board at the enhanced amount of Rs.116/- per square yard as
against Rs.45/- per square yard and vide letter dated 16.12.2000 of
the 2nd respondent, the allottees were asked to pay the difference
amount of Rs.71/- per square yard but no cut-off date for the
payment of the difference amount was mentioned.
68. While the matter stood thus, it is submitted that based on the
instructions from the Government, the Board has stopped to accept
the difference amount from the allottees and by that time only 103
employees have paid the difference of amount of Rs.71/- and rest of
217 could not pay the same.
69. After some correspondence between the Government and the
Board, it was decided to constitute a cabinet sub-committee and the
cabinet sub-committee also recommended and approved that the land HC, J & NVSK, J
already allotted to the employees of the Board may be registered at the
rate of Rs.204/- per square yard including the developmental charge
as approved by the Board subject to the condition that if any increase
in developmental charge over and above Rs.204/- per square yard
arises at the time of execution to be borne by the employee.
70. Subsequently, the Vice Chairman and Housing Commissioner
had submitted a revised proposal with a request to cancel all the
allotments and provide houses in the proposed Hydernagar scheme
and accordingly G.O. Ms. No.32 dated 12.09.2006 was issued by the
1st respondent cancelling the orders issued in G.O. Ms. No.2, dated
10.01.1991. Challenging the same, writ petitions were filed and the
learned Single Judge has passed the impugned common order dated
30.12.2008. Aggrieved by the same, either of the parties i.e. allottees
and the State have filed separate writ appeals.
71. At this juncture, it is necessary and essential to refer the report
dated 06.06.2018 submitted by the Board to the Government from
which it could be culled out that all the allottees have paid the
amount as prescribed in G.O. Ms. No.2, dated 10.01.1991 and from
the report dated 15.03.2013 it is noticed that the Board had requested
the Government to issue necessary orders to withdraw the writ
appeals since all the 320 employees have paid more than the land cost
of Rs.16/- long back as per Board resolution dated 19.11.2000 but
the Government did not choose to do so and contested the appeal
matters.
HC, J & NVSK, J
72. The learned Senior Counsel appearing for the allottees mainly
contended that G.O. Ms. No.32 is arbitrary and contrary to the
principles of promissory estoppel and the doctrine of legitimate
expectation applies.
73. Doctrine of 'legitimate expectation' is a legal principle that
protects individuals' expectation arising from the promises,
representations or established practices of public authorities.
The doctrine of 'legitimate expectation' is one amongst several tools
incorporated by the Court to review administrative action. According
to this doctrine, the public authority can be made accountable in lieu
of a 'legitimate expectation'. A person may have a reasonable or
legitimate expectation of being treated in a certain way by the
administrative authorities owning to some consistent practice in the
past or an express promise made by the concerned authority.
74. In the instant case, the authorities have initiated action for
allotment of individual plots and acted as such thereon by issuing
G.O. Ms. No.2 and thereafter, they have changed their policy from
allotment of individual plots to that of providing flats. Issuance of
G.O. Ms. No.2 itself has given rise for legitimate expectation to the
allottees that they will be provided independent plots and therefore,
the doctrine of 'legitimate expectation' is applicable in the present
case.
HC, J & NVSK, J
75. It is pertinent to note here that while changing the policy from
allotment of individual plots to that of providing flats, the allottes were
never given an opportunity of hearing by way of issuing any kind of
notice or by way of any public notice. In a case of 'legitimate
expectation' if the authority proposes to defeat a person's 'legitimate
expectation' it should afford him an opportunity to make
representations in the matter. In the case of Navjyoti Coop. Group
Housing Society Vs. Union of India 12 the Hon'ble Supreme Court
had categorically held that before introducing or implementing any
change in the guideline for allotment, an opportunity to make
representations against the proposed change in the guideline should
have been given to the registered group housing societies if necessary,
by way of a public notice. The relevant para 16 is extracted
hereunder:
16. It may be indicated here that the doctrine of 'legitimate expectation' imposes in essence a duty on public authority to act fairly by taking into consideration all relevant factors relating to such 'legitimate expectation'. Within the conspectus of fair dealing in case of 'legitimate expectation', the reasonable opportunities to make representation by the parties likely to be affected by any change of consistent past policy, come in. We have not been shown any compelling reasons taken into consideration by the Central Government to make a departure from the existing policy of allotment with reference to seniority in Registration by introducing a new guideline. On the
AIR 1993 SC 155 HC, J & NVSK, J
contrary, Mr. Jaitley the learned Counsel has submitted that the DDA and/or Central Government do not intend to challenge the decision of the High Court and the impugned memorandum of January 20,1990 has since been withdrawn. We therefore feel that in the facts of the case it was only desirable that before introducing or implementing any change in the guideline for allotment, an opportunity to make representations against the proposed change in the guideline should have been given to the registered Group Housing Socieites, if necessary, by way of a public notice.
76. Coming to the impugned order passed by the learned Single
Judge wherein he observed that only on the basis of an idea crept in
the mind of one official, the respondents have gone to the extent of
giving go by to the scheme on the sole ground that there will be loss to
the Government if the sites are allotted to the respective petitioners.
The respondents, having made all arrangements for registration of the
sale deeds in favour of the petitioners, are estopped from saying that
there is no statutory right to the petitioners and that the Government
will be put to loss and the land can be utilised for some other purpose.
After considering the above aspects, the learned Single Judge had
come to a conclusion that G.O. Ms. No.32, dated 12.09.2006 is
arbitrary to the extent of 103 applicants, who have paid the full
amount as required by the respondents.
77. The said observation made by the learned Single Judge appears
to be obvious but extending the benefit of quashing the G.O.Ms. No.32
dated 12.09.2006, only to the extent of 103 applicants, who have paid HC, J & NVSK, J
the full amount as required by the respondents appears to be
oblivious since all the entire 320 applicants have paid the entire
amount as per the G.O. Ms. No.2, dated 10.01.1991 and the benefit of
quashment of G.O. Ms. No.32 has to be extended to the entire 320
applicants. Remaining 217 employees could not pay the difference
amount in pursuance to the order dated 06.04.2001 to stop APHB
from further action on the Board's decision dated 29.11.2000 and that
there was no last date for payment of difference amount mentioned in
the letter dated 16.12.2000.
78. The learned Special Government Pleader placed reliance in the
case of Kerala State Beverages (11 supra) pertains to the service law
wherein the Government modified the rehabilitation policy wherein the
promise became impossible task for non availability of the vacancies.
This judgment does not apply to the facts and circumstances of the
present case as the allottees herein were given lands after collecting
amount based on promise and whereas further collection could not be
done on account of change in the policy of the Housing Board and the
Government for which, the allottees cannot be deprived of their vested
right.
79. Admittedly, the G.Os., were issued solely for the allotment of the
plots to the petitioners and that the policy of allotment of plots
eventually was not extended to the public in general as such,
there cannot be any element of public interest and the orders does not
spell out overriding the public interest. That apart, any change in the HC, J & NVSK, J
policy would put the petitioners in disadvantageous position.
However, the benefit of allotment of plots was not withdrawn by the
Government and there were no special circumstances necessitated the
change in the policy. Further, admittedly individual allotment letters
with plot numbers and plot area was issued by the Board to all the
320 individual employees vide letter dated 04.06.1991. More so,
after receiving the amounts a vested right is created in favour of the
petitioners. The only aspect left was registration of the plots.
Any change in the policy cannot take away the vested right for seeking
registration of the plots as per the allotment letters. When the
petitioners specifically at all times were ready to pay the prescribed
rates and that they were not defaulters. It is also to be noted here
that allotment of plots to the employees of APHB is not made for the
first time and on the earlier policy the housing sites were allotted for
the earlier periods also. As such, the petitioners/allottees having been
received the allotment letters would stand on similar footings.
The doctrine of legitimate expectation cannot be defeated by overriding
the public interest. In the case on hand, there is no public interest on
the subject allotments and the G.Os., passed by the Government does
not give any overriding effect since there is no requisition from the
public. The issuance of G.O. Ms. No.32 appears to be afterthought
and the respondents had completely swayed away from their earlier
policy. In view of the same, the orders in G.O. Ms. No.32 in purport to
the orders passed by the Government has no cogent reasons and is in
violation of the doctrine of legitimate expectation and the same has HC, J & NVSK, J
been rightly quashed by the learned Single Judge in the impugned
order.
80. It is relevant to refer the para No.45 in the case of Mohindhr
Singh Gill and another Vs. Chief Election Commissioner,
New Delhi and others 13, which reads as under:
"45.Kraipak marks the watershed, if we may say so, in the application of natural justice to administrative proceedings. Hegde, J., speaking for a Bench of five Judges observed, quoting for support Lord Parker in In re H.K. (an infant) [(1967) 2 QB 617, 630 : (1967) 1 All ER 226] :
"It is not necessary to examine these decisions as there is a great deal of fresh thinking on the subject. The horizon of natural justice is constantly expanding. (p. 467) (SCC p. 271, para 17) *** The aim of the rules of natural justice is to secure justice or to put it negatively to prevent miscarriage of justice. These rules can operate only in areas not covered by any law validly made. In other words they do not supplant the law of the land but supplement it. (p.
468) (SCC p. 272. para 20)"
81. Having regard to the facts and circumstances of the case,
submissions made by the learned counsel on either side and also
taking into consideration the aforementioned judicial pronouncements
into consideration, we are of the considered opinion that the
respondents' authorities have totally misdirected themselves and the
(1978) 1 Supreme Court Cases 405 HC, J & NVSK, J
issuance of G.O. Ms. No.32 dated 12.09.2006 is manifestly erroneous
and therefore, the G.O. Ms. No.32 dated 12.09.2006 is liable to be
quashed in its entirety and accordingly quashed. Consequently,
the impugned common order dated 30.12.2008 passed by the learned
Single Judge allowing the writ petitions in part is liable to be set aside
and accordingly, the same is set aside.
82. In the result, the appeals preferred by the petitioners/
appellants/allottees i.e. W.A. Nos.43, 120, 121, 181 182, 183, 474
and 525 of 2009 are allowed and consequently, the appeals preferred
by the State i.e. W.A. Nos.131, 139, 367 and 372 of 2009 are
dismissed. A direction is issued to the Government and the Housing
Board authorities to act upon the earlier G.O. Ms. No.2 dated
10.01.1991 and after collecting the difference of amount from the
petitioners/allottees shall register the plots in terms of the original
allotment letters issued on 04.06.1991 within a period of Four (4)
months from the date of receipt of a copy of this order. There shall be
no order as to costs.
As a sequel, miscellaneous applications, if any pending, shall
stand closed.
___________________________ ALOK ARADHE, CJ
___________________________ N.V. SHRAVAN KUMAR, J Date: 10-11-2023
Note: L.R. copy to be marked.
B/o.
LSK HC, J & NVSK, J
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