M. Sundararajan vs Appropriate Authority

K.A. Swami, C.J.—This writ appeal is preferred against the order dated 5-1-1994 passed by the learned Single Judge in W.P. No. 15039 of 1988. The learned Single Judge has held that the clarificatory observation made by the Supreme Court in C.B. Gautam Vs. Union of India and Others, would apply to the case and, therefore, the petitioner is not entitled to the application of the ratio of that decision to his case and, accordingly, dismissed the writ petition. The relevant facts in this case are as follows: There was an agreement of sale entered into between the petitioner and the third respondent in respect of the immovable property in question on 25-8-1988 under which the third respondent agreed to sell the immovable property in question to the petitioner for a sum of Rs. 19,00,000 and out of that a sum of Rs. 1 lakh was paid by the petitioner to the third respondent as an advance. Pursuant to the agreement, the petitioner and the third respondent applied for permission to the appropriate authority under the provisions of the Act. However, the appropriate authority exercising the power u/s 269UD(1) directed pre-emptive purchase of the immovable property in question by order dated 15-11-1988. The order of purchase was served upon the third respondent on 25-11-1988 and on the petitioner on 28-11-1988. The possession appears to have been delivered by the vendor on 29-11-1988 itself to the appropriate authority though the time for delivery was up to 10-12-1988. The petitioner filed the writ petition in question on 5-12-1988 itself within a period of one week and obtained an order of injunction on 8-12-1988 itself restraining the respondents from proceeding further in the matter. However, on 2-1-1989 after hearing both sides, learned Single Judge passed the following interim order:

"After hearing the learned counsels on both sides, I pass the following order:

The department, namely, the respondents 1 and 2 will pay a sum of Rs. 18,00,000 to the 3rd respondent, owner of the property within ten days from today. On such payment, the 3rd respondent will return a sum of Rs. 1,00,000 received from the writ petitioner by way of advance. Possession of the property shall continue to be with respondents 1 and 2 pending disposal of the writ petition. In the event of the writ petitioner succeeding in the writ petition, the balance of the sale consideration now paid by the respondents 1 and 2 will have to be paid by the writ petitioner to the respondents 1 and 2 before getting or taking possession from the respondents 1 and 2. The writ petitioner further, on payment of Rs. 1,00,000 to the 3rd respondent in the writ petition, is entitled to ask for execution of a sale deed from the 3rd respondent. These petitions are disposed of accordingly without prejudice to the contentions of both parties in the main writ petition."

The decision in C.B. Gautam''s case (supra) was rendered by the Supreme Court on 17-11-1992 and the clarificatory note was made on 27-11-1992. Thus, it is clear that the transaction had not been completed when the writ petition was filed. Though possession was delivered by the vendor, immediately the intending purchaser approached the Court and obtained an order of temporary injunction as pointed out above. The payment of consideration by the appropriate authority to the owner has taken place pursuant to the order of this Court made on 2-1-1989 in the aforesaid terms extracted above. These facts which are not disputed, bring the case within the ratio of our judgment dated 13-7-1994 rendered in D. Rajagopal v. Managing Director, Madras Metropolitan Water Supply & Sewerage Board [W.A. Nos. 215 and 216 of 1992].

Accordingly, following the said decision, this writ appeal is entitled to succeed. It is accordingly allowed. The order dated 5-1-1994 passed by the learned Single Judge and also that of the appropriate authority are set aside and the following directions are issued:

(1) The applications filed for permission by the petitioner and the third respondent before the appropriate authority under Chapter XX-C of the Act is remitted to the appropriate authority for a decision in accordance with law and in the light of the observations made in C.B. Gautam''s case (supra), after affording an opportunity to the petitioner and the third respondent if he appears.

(2) Within four weeks from today, the petitioner/appellant shall furnish bank guarantee for a sum of Rs. 19 lakhs to the satisfaction of the appropriate authority to ensure that in the event he succeeds before the appropriate authority, he must be in a position to pay the consideration amount of Rs. 19 lakhs.

(3) In the event the appropriate authority grants permission for purchasing the property by the petitioner/appellant, it is open to the appropriate authority to encash the bank guarantee. In that event, the petitioner/appellant shall pay interest at the rate of 12 per cent on the sum of Rs. 19 lakhs to the appropriate authority from the date the appropriate authority had paid that sum to the vendor within three weeks from the date the order granting permission for sale is passed.

(4) In the event the appropriate authority decides to order compulsory purchase of the property in question, the Bank Guarantee of Rs. 19 lakhs furnished by the petitioner/appellant shall stand cancelled.

The parties shall appear before the appropriate authority on 18-8-1994. The appropriate authority shall complete the proceedings within two months from 18-8-1994. However, there shall be no order as to costs.