Defence Enclave Residents
Society Vs. State of U.P. & Ors  Insc 560 (20 September 2004)
Shivaraj V. Patil & B.N.
Srikrishna With Writ Petitions (C) Nos. 185/ 2001, 349/2002 And 303/2003
These four writ petitions under Article 32 of the Constitution, though
slightly differing on facts, raise the same issue of law and, therefore, can be
conveniently disposed of by a common judgment.
Writ Petition No. 344 of 2000:
This writ petition is by a society of the residents of a colony known as
'Defence Enclave' in Meerut. The respondents to the writ petition are the State
of U.P., the Meerut Development Authority and the Special Land Acquisition
Officer, Meerut, U.P.
The second respondent, Meerut Development Authority (hereinafter referred to
as 'the authority') is a statutory authority constituted under Section 4 of the
Uttar Pradesh Urban Planning and Development Act, 1973 (hereinafter referred to
as 'the Act'). The objectives of the authority are securing the development of
the development area according to plan and for that purpose the authority has
the power to acquire, hold, manage and dispose of land and other property, to
carry out building, engineering, mining and other operations, to execute works
in connection thereto for such development and for purposes incidental thereto.
Under Section 17 of the Act, the State Government is empowered to acquire any
land, if land is required for the purpose of development, or for any other
purpose of the Act and State Government, having taken possession of the land,
is empowered to transfer it to the Authority on payment by the Authority of the
compensation awarded under the Act and the charges incurred by the Government
in connection with the acquisition. Under Section 18 of the Act, the Authority may
dispose of the land acquired by the State Government after undertaking or
carrying out such development as it thinks fit, to such persons, in such
manner, and subject to such terms and conditions as it considers expedient for
securing the development of the development area according to plan.
Under sub-Section (2) of Section 18 the Authority is empowered to dispose of
the land by sale, exchange or lease or by the creation of any easement, right
or privilege or otherwise.
One of the main functions of the second Respondent authority is urban
development. Pursuant to this objective, the second Respondent formulated a
scheme known as "Defence Enclave". The scheme envisaged allotment of
land on long lease for 90 years to retired and serving Defence personnel. For
the purpose of implementing the scheme, the first Respondent, State of U.P.,
acquired land by invoking its powers under the Land Acquisition Act, 1894. The
Land Acquisition Officer awarded compensation for the acquired lands @ Rs. 50/-
per sq. yard to the land holders. The land holders sought a reference under
Section 18 of the Land Acquisition Act and the reference Court enhanced the
compensation from Rs. 50/- per sq. yard to Rs. 240/- per sq. yard by an award
First and second Respondent carried the matter in appeal before the High
Court of Judicature at Allahabad. The claimants also filed cross appeals. The
High Court by its judgment dated 12.1.1995 reduced the compensation from
Rs.240/- per sq. yard to Rs.75/- per sq. yard.
The claimants filed special leave petitions in this Court which came to be
disposed of by an Order dated 30.4.1997. This Court enhanced the compensation
payable to the claimants from Rs. 75/- per sq. yard to Rs. 175/- per sq. yard.
While disposing of the special leave petitions, this Court observed as under:
"The appeals are, accordingly allowed. The judgment of the High Court
stands set aside. The award and decree of the reference Court in respect of
villages stand modified. In view of the facts and circumstances of the case,
parties are directed to bear their own costs. If the amount has already been
deposited as per the award of the reference Court to the extent of variation,
the Meerut Development Authority is entitled to restitution.
It is open to the Meerut Development Authority to enforce the award for
seeking restitution. In view of the increase in the case of valuation of the
lands, necessarily, enhanced compensation would form a component for charging
the said amount from the purchaser in respect of the respective plots on
buildings, as the case may be, towards the developmental expenses."
Although, originally, the 'Defence Enclave' scheme formulated by second
Respondent contemplated allotment of plots at fixed rate of Rs.600/- per sq.
meter, on which basis the petitioner and others had taken possession during the
period March, 1995 to December, 1995, pursuant to the order of this Court dated
30.4.1997, second Respondent decided that the plot holders would have to pay an
additional amount of Rs. 694/- per sq. meter.
Accordingly, the second Respondent addressed a letter to the Secretary of
the petitioner Society on 9.7.1997 calling upon the petitioner-Society to
collect the additional amounts from its members, who had been allotted the
plots, and remit the same on or before 31.7.1997, failing which interest @ 15%
per annum would have to be paid by the petitioner-Society up to the date of
The petitioner-Society has impugned the action of second Respondent by the
present writ petition under Article 32 of the Constitution on the following,
amongst other, grounds:
"(iii) That the MDA now has record out of the concluded contract
between the Petitioner Society and the MDA and the demand, therefore, is not
(v) That the impugned demand of Rs. 694/- per sq.
meter over and above Rs. 600/- per sq. meter as per the terms of allotment
is tantamount to violation of the contract between the petitioner and the MDA
and is, therefore, not sustainable.
(vi) That all acts of the public authority must be public oriented as this
sovereignty ultimately lies in the people. The demand clearly infringes the
fundamental right to property of the Members of the Petitioner Society."
The respondents have opposed the writ petition inter alia on the ground that
the writ petition is an abuse of the process of law; that the brochure
published by second Respondent had clearly stated that: "the site, size
and price of the proposed property under this scheme is provisional.
Vice-Chairman, MDA has right to make any alteration. In case of any dispute,
the decision of Vice-Chairman, MDA shall be final and binding on the
applicants/allottees." It is also pleaded by the second Respondent that
the sale deeds executed by various purchasers contained an enhancement clause
to the effect that the cases regarding enhancement of compensation were
pending, and, in the event of such enhancement being granted by the court,
second Respondent reserved the right to realize the additional amount from the
purchasers. In the copy of the model sale deed placed on record, this clause
finds place, which reads as under:
"2. That although the first party has realized the sale consideration
from the second party before the execution of this deed, but since the house is
constructed on the land, with respect of which the cases regarding compensation
are pending before different courts and, in case, in future, the amount of
compensation is enhanced in the cases relating to land acquisition, in that
case, the first party shall have a right to issue demand letter with respect to
enhanced amount and the second party shall be bound to pay the enhanced amount
and shall have no objection in its recovery along with 18% annual interest with
other expenses, as arrears of land revenue. Any supplementary deed, with
respect of the additional amount taken from the second party shall be executed
later." The petitioner pleads in the writ petition that, in view of this
concluded contract, the members of the petitioner Society, who were
purchasers/allottees of the plots, could not be called upon to pay any
additional price, irrespective of the fact that the land holders whose lands
were acquired by second Respondent had to be paid higher compensation under the
order of this Court as it would "tantamount to violation of the contract
between the Petitioner and the MDA". It is also pleaded that the action of
the second Respondent "clearly infringes the fundamental right to property
of the members of the petitioner society".
In our view, this writ petition is entirely misconceived. A perusal of the
grounds on which relief is sought makes it clear that what is really a
contractual dispute is sought to be masqueraded as breach of fundamental rights
under Articles 14, 19 and 21 of the Constitution.
In the first place, a fundamental right to property no longer exists by
reason of the deletion of Clause (f) from Article 19(1) of the Constitution by
the Constitution (Forty-fourth Amendement) Act, 1978, sec. 2, (w.e.f.
Secondly, it is not possible to accept the contention that Article 21 has
been infringed or that there is a violation of Article 21 by reason of a
dispute which has arisen between the two parties to a contract with regard to
price payable for land allotted to the members of one of the parties.
Finally, as to the allegation of breach of Article 14, we find that this
issue cannot be adjudicated unless the full facts of the contractual dispute
are ascertained and the contractual rights of the parties are adjudicated. We
also find that, as a matter of fact, one of the associations had filed civil
suit before the Civil Court at Meerut, being Original Petition No. 845 of 1999,
and sought for an injuction therein. We are informed that, though the
injunction order was not granted, the suit is still pending.
In these circumstances, we called upon the learned counsel for the
petitioner to satisfy us as to why we should entertain a writ petition directly
under Article 32 of the Constitution, in what appears to be a purely
The learned counsel for the petitioner contended that the second Respondent
was constrained to move this writ petition under Article 32 of the Constitution
only because of the observations of this Court made in Order dated 30.4.1997,
which we have quoted supra. He contends that, in view of these observations,
all courts including the High Court would feel bound by these observations and
it would be futile for the petitioner to move in a civil court or even attempt
to claim relief under Article 226 of the Constitution before the concerned High
In our view, the apprehension voiced for the petitioner is unjustified and
misplaced. In the first place, the allottees of lands, the members of the
petitioner Society, were not parties to the special leave petitions in which
the said Order of this Court was given. Secondly, the above observations appear
to be more in the nature of general observations and not intended as a
direction, as assumed by the second Respondent. A reading of the said Order
dated 30.4.1997 does not disclose that individual sale deeds executed between
the allottees and the second Respondent authority were either adverted to or
considered. The above observations appear to proceed on the tacit assumption
that there were individual contracts under which the liability for increased
compensation could be passed on to the allottees of lands. A careful perusal of
the said order does not indicate that the issue as to whether the increased
burden on account of the increase of the compensation was to be borne by the authority
or if it could be passed on to the purchasers/allottees of land, was neither
pleaded, nor raised, nor adverted to in the order. Except by way of a passing
reference to the effect "In view of the increase in the case of valuation
of the lands, necessarily, enhanced compensation would form a component for
charging the said amount from the purchaser in respect of the respective plots
on buildings, as the case may be, towards the developmental expenses"
there does not appear to be any discussion on this issue in the entire order.
We, therefore, do not think that the aforesaid observations were intended to
bind and operate against persons who were not parties to the special leave
petitions before this Court without consideration of the complete facts and
circumstances in respect of such persons.
In our view, what is projected before us, though under the camouflage of an
infringement of fundamental right, is really a contractual dispute pure and
simple. As to whether there is a right reserved in the second Respondent to
pass on the additional liability to the purchasers, is determined by the terms
of the contract between the parties. Though, a model sale deed has been placed
on record before us, we think it necessary that the facts in each case have to
be investigated, the terms of the contract between the second Respondent and
the allottee be determined on evidence and construed, before the dispute can be
In our view, a writ petition under Article 32 of the Constitution is neither
an occasion, nor an appropriate remedy, for such a dispute. Without expressing
anything further on the merits of the dispute between the parties, we decline
to exercise our jurisdiction under Article 32 of the Constitution in view of
the peculiar facts and circumstances of the case before us.
Writ Petition No. 185 of 2001:
The facts here are almost the same as in the case of writ petition No.
344/2000. In this case, the land was acquired for the Society known as
Shradhapuri, Phase-II at Meerut, U.P. The special leave petitions came to be
disposed of by the same Order dated 30.4.1997, by which the compensation was
increased. Pursuant thereto, second Respondent authority issued demand notices
to the individual members of the society claiming increased compensation of
Rs.654/- per sq. meter. In view of the fact that writ petition No. 344/2000 was
already admitted in somewhat similar circumstances, this writ petition came to
Although, the learned counsel tried to impress upon us that there was some
distinction between this case and that in writ petition No. 344/2000, we find
there is hardly any material difference between the two.
Writ Petition No. 303 of 2003:
The second Respondent floated a scheme for residential plots. For the rest,
the facts are same as in case of writ petition No. 344/2000. Here also, the
compensation payable to the land owners was increased by the same Order dated
30.4.1997 of this Court and, following thereupon, the second Respondent
authority issued notices demanding additional payments.
The petitioner contends that, once having fixed the price in the brochure,
the authority was not empowered by any law to pass on the liability of
additional charges in any form whatsoever, "not stipulated under the
contract or the law governing the same". In this case, the authority has
not allotted land by way of sale, but granted long leases of residential plots.
It is alleged that while the price was charged initially Rs. 176 per sq.
meter, the authority is now demanding Rs.850/- per sq. meter, which,
according to the petitioner, is unreasonable and arbitrary. The petitioner also
pleads that "it is immaterial so far as the purchasers and the allottees
were concerned, what amount the authority was liable to pay for acquisition
under Section 17. So far as the disposal of the land is concerned, it is
governed by the terms and conditions entered into between the Development
Authority and the allottees or the purchasers." (emphasis ours) It is
averred in the writ petition that one of such associations has filed a civil
suit before the Civil Court at Meerut numbered as Original Petition No. 845 of
1999 which is pending before the said court. However, in the meanwhile 'Defence
Enclave' society had filed a writ petition before this Court, which is admitted
and numbered as WP 344/2000. Hence, this writ petition is filed and came to be
In our view, there is no substantial difference between the case of this
writ petitioner and the other writ petitioners in the group. Here also, it is
not possible to ascertain as to what are the exact terms of the contract
between the individual members of the society and the second Respondent.
Writ Petition No. 349 of 2002:
This is another writ petition arising from the same set of facts. The members
of the petitioner's association are said to be senior citizens for whose
welfare a residential scheme was floated.
Here also, it is contended in the petition that second Respondent is
"bound by the terms" (emphasis ours) and demanding the enhanced compensation
amount on the part of second Respondent is "tantamount to violation of the
own extent contract in between the petitioner as well as the MDA."
(emphasis ours) What is true of the other writ petitions is also true of this.
In any event, whether the second Respondent authority could pass on the
increased liability consequent upon the additional compensation payable to the
land owners of the acquired land, and, if so, how much of it could be passed on
to the purchasers/allottees of the land, is a matter requiring careful
investigation of the facts and circumstances, including the detailed terms of
the contract between the second Respondent authority and the individual flat
purchaser/allottee of sites. It would also require an examination of the basis
on which the cost of each site was worked out. These are matters requiring
detailed evidence, without which a satisfactory adjudication of the dispute is
not possible. A writ petition under Article 32 of the Constitution is hardly an
occasion for such exercise.
Writ Petitions Nos. 344 of 2000, 185 of 2001, 349 of 2002 and 303 of 2003:
For the aforesaid reasons, we are of the view that these writ petitions are
liable to be dismissed. Hence, all the four writ petitions are dismissed
leaving open all the rights and contentions of the parties to be agitated
before any other appropriate forum.
No order as to costs.