Roochira Ceramics vs The State of Haryana and Others

Amarjeet Chaudhary and N.C. Khichi, JJ.—In this writ petition under Articles 226/227 of the Constitution of India, the prayer is for

quashing the order dated 7.4.1995/8.5.1995 vide which industrial plot No. 5-B, Sector 15-A, Faridabad allotted to the petitioner has been

resumed and the entire money deposited by the petitioner has been forfeited and the order dated 12.9.1995 vide which appeal filed by the

petitioner-Company against the resumption order was dismissed as also notice dated 21.4.1995 issued u/s 18(1) of the Haryana Urban

Development Authority Act.

Unshorn of necessary details, relevant facts of the case are that the petitioner was allotted industrial plot measuring 1.80 acres for an amount of

Rs. 2,61,360/-. Later on the area of the plot was increased to 2.10 acres and the amount was also increased to Rs. 3,05,827.50P. The petitioner,

at the time of initial allotment had deposited 25% of the tentative cost of plot. A sum of Rs. 2,5,0457.67P was due to the petitioner upto

19.12.1980. The petitioner, in all, had deposited a sum of Rs. 1,90,000/- in the office of respondent No. 3. As per record of respondent No. 3, a

sum of Rs. 18,21,448.90P was due from the petitioner which also includes interest, penalty and enhanced compensation upto 7.12.1995. The

petitioner had also constructed a factory on the plot. The plot in question was resumed for non-payment of instalments etc. after issuing notices to

the petitioner. The petitioner filed an appeal against the resumption order which was also dismissed.

The case of the petitioner is that it was to set up factory for the manufacture of Ceramic Products. The factory could not function as coal etc.

was not allotted to the petitioner. Therefore, the petitioner faced financial stringency. The petitioner also averred that no notice was served upon it

at the address supplied by it. However, notices were sent at some other place. Therefore, the mandatory provisions of Sections 17(1) (2) and (3)

of the Act which require service of notice have not been complied with. The proceedings initiated against the petitioner were not communicated to

it. The entire proceedings initiated are vitiated.

On notice of motion having been issued, respondents put in appearance and respondent No. 3 filed written statement. In which material

averments of petitioner have been controverted.

We have heard learned counsel for the parties and perused the paper book.

Mr. Sarin, learned counsel for the petitioner has stated that the petitioner is willing to deposit the outstanding dues in case time is given to it and

the possession is also given.

It is apposite to reproduce the relevant provisions of the Act;-

(l)Where any transferee makes default in the payment of any consideration money, or any instalment, on account of the sale of any land or

building, or both, u/s 15, the Estate Officer may, by notice in writing, call upon the transferee to show cause within a period of thirty days, why a

penalty which shall not exceed ten percent of the amount due from the transferee, be not imposed upon him.

(2) After considering the cause, if any, shown by the transferee and after giving him a reasonable opportunity of being heard in the matter, the

Estate Officer may, for reasons to be recorded in writing, make an order imposing the penalty and direct that the amount of money due alongwith

the penalty shall be paid by the transferee with in such period as may be specified in the order.

(3) If the transferee fails to pay the amount due together with the penalty in accordance with the order made under Sub-Section (2), or commits a

breach of any other condition of sale, the Estate Officer may, by notice in writing, call upon the transferee to show cause within a period of thirty

days, why an order of resumption of the land or building, or both, as the case may be, and forfeiture of the whole or any part of the money, if any,

paid in respect thereof which is no case shall exceed ten per cent of the total amount of the consideration money, interest and other dues payable in

respect of the sale of the land or building, or both, should not be made.

(4) After considering the cause, if any, shown by the transferee in pursuance of a notice under sub-section (3) and any evidence that he may

produce in support of the same and after giving him a reasonable opportunity of being heard in the matter, the Estate Officer, may for reasons to be

recorded in writing, make an order resuming the land or building or both, as the case may be, and directing the forfeiture as provided in sub-

section (3) of the whole or any part of the money paid in respect of such sale.

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From the above provisions, it is crystal clear that in the event of default of any instalment, the plot can be resumed and forfeiture and penalty can

be imposed on the defaulting party.

The case of petitioner, is that it got the plot for setting up a unit for the production of Ceramic Products approved by the Director of Industries,

Haryana. The coal was the basic raw material to be used for manufacturing the said product. Due to acute shortage of coal, the same was not

allotted to the petitioner. Due to non-availability of coal, the Project of the petitioner could not function.

Keeping in view the financial stringency of the petitioner, interest of the parties, readiness and willingness of the petitioner to pay the remaining

unpaid amount and to set the controversy at rest, orders Annexures P-5 to P-8 are quashed. The petitioner shall deposit the balance amount of

instalments, including enhancement of price alongwith interest at the rate of 10% per annum on the unpaid amount within a period of three months.

The respondents shall calculate and convey to the petitioner the total amount payable by it within two weeks from the date of receipt of copy of

judgment. After the receipt of intimation regarding the total amount of its liability, the petitioner shall deposit the said amount within two months

thereafter positively. In case, the petitioner fails to deposit the amount within the time specified despite intimation in terms of our judgment, it shall

be liable to pay whole of the amount to the respondents as per the demand and the calculations made by the respondents according to the order

impugned and it shall not be held entitled to any further time to make the payment. It is relevant to mention here that as per stipulation in the

allotment letter, copy/Annexure P-1 to the writ petition, interest at the rate of 10% per annum is being charged from the petitioner.

From the language of Section 17, it is apparent that penalty can be imposed, though not mandatory. We, therefore, maintain the order of

penalty as no justifiable cause has been shown to upset the same.

The writ petition is disposed of in the above terms.