Commissioner of Municipal Corporation, Shimla Vs. Prem Lata Sood and Others
 Insc 573 (15 May 2007)
S.B. Sinha & Markandey Katju
CIVIL APPEAL NO. 2525 OF 2007 [Arising out S.L.P. (Civil) No. 3292 of 2006]
S.B. SINHA, J :
1. Leave granted.
2. This appeal is directed against the judgment and order dated 16.08.2005
passed by a Division Bench of the High Court of Himachal Pradesh at Shimla,
whereby and whereunder the writ petition filed by Respondent Nos. 1 to 5
herein, praying, inter alia, :
"i) That the respondents may be directed to accord necessary planning
permission to the petitioners for construction of hotel pursuant to Annexures PA,
PB, PC & PG in a time bound schedule;
ii) That the impugned Annexures PD, PE, PF &
PH, dated 24.3.1998, 1.9.1999, 6.6.2000 &
8.2.2002 respectively may be quashed and set aside";
3. The State of Himachal Pradesh enacted 'The Himachal Pradesh Town and
Country Planning Act, 1977' (for short, 'the 1977 Act') to make provisions for
planning and development as well as use of land; to make better provision for
the preparation of development plans and sectoral plans with a view to ensuring
that town planning schemes are made in a proper manner and their execution is
made effective to constitute the Town and Country Development Authority for
proper implementation of town and country development plan, to provide for the
development and administration of special areas through the Special Area
Development Authority to make provisions for the compulsory acquisition of land
required for the purpose of the development plans and for purposes connected
with the matter aforesaid.
4. 'Development' has been defined in Section 2(g) of the 1977 Act to mean :
"development" with its grammatical variations means the carrying
out of a building, engineering, mining or other operations in, on, over or
under land, or the making of any material change in any building or land, or in
the use of either, and includes sub-division of any land;"
'Planning area' has been defined in Section 2(o) of the 1977 Act to mean :
"planning area" means any area declared to be planning area under
5. Section 3 of the 1977 Act provides for appointment of a Director or other
officers for the purpose of carrying out the functions under the provisions of
the said Act. Section 10 of the said Act provides for restriction on use of
land or development thereof, sub-section (3) whereof reads as under :
"(3) If any work is carried out in contravention of the provisions of
this section, the Municipal Corporation or Municipal Committee within its such
local area, and the Collector in area outside such local areas may cause such
work to be removed or demolished at the cost of the defaulter, which shall be
recovered from him in the same manner as an arrear of land revenue."
6. Section 14 of the 1977 Act provides for preparation of development plans
by the Director. Section 17 provides for interim development plans, pursuant to
or in furtherance whereof the interim development for the planning area has
been made to which reference shall be made at an appropriate place.
7. In terms of the said provisions, an interim development plan is to be
made after consultation with the local authority concerned. Sub-section (5) of
Section 17 mandates the State Government to publish the interim development
plan in the official gazette.
8. Chapter VI of the 1977 Act provides for control of development and use of
land. Section 25 thereof reads as under :
"25. The overall control of development and the use of land in the
planning area shall, as from the date of publication in the official Gazette of
a notification by the State Government, vest in the Director."
9. Section 30 of the 1977 Act provides for an application for permission for
development by a person other than Union Government, State Government, a local
authority or a special authority constituted thereunder.
An application therefor is required to be filed in the office of the
Section 31 provides for the mode and manner in which such application shall
be governed, inter alia, stating :
"(5) If the Director does not communicate his decision whether to grant
or refuse permission to the applicant within two months from the date of
receipt of his application, such permission shall be deemed to have been
granted to the applicant on the date immediately following the date of expiry
of two months.
10. Chapter IX provides for control. Section 76 of the 1977 Act provides for
a non-obstante clause in terms whereof the Government is empowered to review plans
etc. for ensuring conformity, in the following terms :
"76. Notwithstanding anything contained in any other enactment for the
time being in force, the State Government may, with a view to ascertaining that
no repugnancy exists or arises with the provisions of this Act or the rules
made thereunder, review the town improvement schemes, building plans or any
permission for construction sanctioned or given by any authority under
development plans, sanctioned under any enactment for the time being in force
and may revoke, vary, or modify any scheme, plan, permission or sanction in
conformity with the provisions of this Act :
Provided that no order under this section shall be made without giving a
reasonable opportunity of being heard to the persons affected thereby."
11. The said Act, thus, provides for an overall policy to be taken by the
authority as well the State Government.
12. The State of Himachal Pradesh also enacted the 'Himachal Pradesh
Municipal Corporation Act, 1994' (for short, 'the 1994 Act'). A municipal
corporation constituted under the said provisions is a local authority within
the meaning of the provisions of the 1977 Act.
13. Section 243 of the 1994 Act provides that every person who intends to
erect a building shall apply for sanction by giving notice in writing of his
intention to the Commissioner in such form and containing such information as
may be prescribed by the bye-laws made in that behalf. Despite the fact that
the 1977 Act provides for filing of an application for a development plan, when
an interim development plan has been made, the 1994 Act also provides for
sanction of a building plan, if a person intends to execute any of the works
specified under Section 244 of the 1994 Act. The said provision lays down that
every person who intends to execute any of the works specified therein shall
apply for sanction by giving notice in writing of his intention to the
Commissioner in such form and containing such information as may be prescribed
by the bye-laws made in that behalf. Section 245 of the 1994 Act provides for
issuance of a notice wherein the purpose for which it was intended to use the
building is required to be specified in the following terms :
"245.(1) A person giving the notice required by section 243 shall
specify the purpose for which it is intended to use the building to which such
notice relates and a person giving the notice required by section 244 shall
specify whether the purpose for which the building is being used is proposed or
likely to be changed by the execution of the proposed work.
(2) No notice shall be valid until the information required under
sub-section (1) and any further information and plans which may be required by
bye-laws made in this behalf have been furnished to the satisfaction of the
Commissioner along with the notice."
14. Section 246 which provides for the power of the Commissioner to grant or
refuse to grant such sanction, which is relevant for our purpose, reads as
"246(1).- The Commissioner shall sanction the erection of a building or
the execution of a work unless such building or work would contravene any of
the provisions of sub-section (2) of this section or the provisions of section
(2) The grounds on which the sanction of a building or work may be refused
shall be the following, namely :- (a) that the building or work, or the use of
the site for the building or work or any of the particulars comprised in the
site plan, ground plan, elevation, section or specification would contravene
the provisions of any bye-law made in this behalf or of any other law or rule,
bye-law or order made under such other law;
(b) that notice for sanction does not contain the particulars or is not
prepared in the manner required under the bye-laws made thereunder has or have
not been duly furnished;
(c) that any information or documents required by the Commissioner under
this Act or any bye-laws made thereunder has or have not been duly furnished;
(d) that in cases falling under section 222 lay out plans have not been
sanctioned in accordance with section 223;
(e) that the building or work would be an encroachment on Government land or
land vested in the Corporation;
(f) that the site of the building or work does not abut on a street or
projected street and that there is no access to such building or work from any
such street by a passage or pathway appertaining to such site;
(g) that the building or work would be in contravention of any scheme
sanctioned under section 260; and (h) that a building for habitation, does not
provide for a flush or a water seal latrine.
(3) The Commissioner shall communicate the sanction to the person who has
given the notice; and where he refuses sanction on any of the grounds specified
in sub-section (2) of this section or under section 250 he shall record a brief
statement of his reasons for such refusal and communicate the refusal alongwith
the reasons therefor to the person who has given the notice.
(4) The sanction or refusal as aforesaid shall be communicated in such
manner as may be specified in the bye-laws made in this behalf."
15. Section 247 of the 1994 Act provides for a deeming provision in the
following terms :
"247.(1) Where within a period of sixty days after the receipt of any
notice under section 243 or section 244 or of the further information, if any,
required under section 245 the Commissioner does not refuse to sanction the
building or work or upon refusal does not communicate the refusal to the person
who has given the notice, the Commissioner shall be deemed to have accorded
sanction to the building or work and person by whom the notice has been given
shall be free to commence and proceed with the building or work in accordance
with his intention as expressed in the notice and the documents and plans
accompanying the same :
Provided that if it appears to the Commissioner that the site of the
proposed building or work is likely to be affected by any scheme of acquisition
of land for any public purpose or by any proposed regular line of a public
street or extension, improvement, widening or alteration of any street, the
Commissioner may withheld sanction of the building or work for such period not
exceeding sixty days as he deems fit and the period of sixty says shall be
deemed to commence from the date of the expiry of the period for which the
sanction has been withheld.
(2) Where a building or work is sanctioned or deemed to have been sanctioned
by the Commissioner under sub-section (1), the person who has given the notice
shall be bound to erect the building or execute the work in accordance with
such sanction but not so as to contravene any of the provisions of this Act or
any other law or of any bye-law made thereunder.
(3) If the person or any one lawfully claiming under him does not commence
the erection of the building or the execution of the work within one year of
the date on which the building or work is sanctioned or is deemed to have been
sanctioned, he shall have to give notice under section 244, or, as the case,
may be, under section 243 for fresh sanction of the building or the work and
the provisions of this section shall apply in relation to such notice as they
apply in relation to the original notice.
(4) Before commencing the erection of a building or execution of a work
within the period specified in sub-section (3), the person concerned shall give
notice to the Commissioner of the proposed date of the commencement of the
erection of the building or the execution of the work.
Provided that if the commencement does not take place within seven days of
the date so notified, the notice shall be deemed not to have been given and a
fresh notice shall be necessary in this behalf.
(5) Where the building plan is sanctioned or deemed to have been sanctioned,
the person, at whose instance building operations are to be carried on, shall,
after the excavation of the foundation and before starting construction
thereon, intimate the Corporation about the excavation of the foundation.
(6) For the purpose of ascertaining, whether the strata of the land, over
which a building is to be erected is geologically fit, and the building
operation thereon can be carried out in accordance with the sanctioned plan,
the Corporation may, within seven days from the intimation under sub-section
(5), cause inspection of excavated foundation to be made by such persons as it
may direct, and in such manner as may be prescribed :
Provided that the person at whose instance the building operations are
carried out shall be associated in the inspection.
(7) The persons making the inspection under sub-section (6), may communicate
to the person, from whom intimation under sub-section (5) has been received,
its views in regard to the result of such inspection and may after ascertaining
the opinion of the said person, recommend to that person the action to be taken
as a result of such inspection and also report to the Commissioner the action,
if any, which is proposed to be taken for the purposes of implementation of any
(8) On the receipt of the report under sub- section (7), the Corporation
may, within seven days from the date of intimation under sub-section (5), give
such direction to the person concerned, as it may deem fit."
16. We may, however, notice that a similar Act which was then prevailing,
namely, Himachal Pradesh Municipal Corporation Act, 1979 was repealed.
17. Respondent No.1 to 5 herein (hereinafter referred to as 'the
respondents) intended to construct a hotel on the Mall Road in the town of
Shimla. They filed an application for grant of planning permission to the Town
and Country Planning Department on 27.06.1994. Such permission was approved by
the Government of Himachal Pradesh by an order dated 16.01.1998.
18. The Executive Engineer of Respondent No.6 herein granted permission
under sub-section (1) of Section 31 of the 1977 Act subject inter alia, to the
condition that building permission should be obtained from the local authority
concerned before commencement of the development.
19. An application for sanction of the building plan in terms of the
provisions of the 1994 Act and building bye-laws framed thereunder was
submitted by Respondent No.1 on 07.07.1999. The Municipal Corporation, however,
returned the said plans asking for certain clarifications. Such clarifications
evidently had been asked for by the appellant herein in terms of Section 246 of
the 1994 Act.
20. Respondents resubmitted the plans upon purported compliance of the
objections raised in the said letter dated 01.09.1999 only on 10.04.2000.
However, immediately thereafter a purported temporary freeze on construction
activities in some areas appertaining to Shimla Planning Area was issued by the
Government of Himachal Pradesh, stating :
"I am directed to say that it has been decided by the Government that
all development activities in banned area of Shimla planning area are to be
temporarily frozen till the finalization of new guidelines to be framed by the
government for these area.
In view of the above decision of the government on planning permission cases
are to be approved or sent to this department till further orders."
21. Respondents were informed thereabout by the appellant in terms of its
letter dated 06.06.2000, stating :
"Application for construction of house submitted on 10.4.2000 by you.
On receipt of report from various departments, the case has been considered in
which proposed hotel on Khasra Nos. 315, 316, 317, 318, 321, 322, 320, 310,
311, 313, 312, 319 at Talpat Cottage, Shimla Sanction has been asked for.
Hence the map with the following observations has not been considered for
1. Pucca burjirs have not been fixed at site.
2. The proposal shown with the cutting of earth more than 3.00 M in both the
blocks cannot be allowed as per M.C. bye-laws.
3. The proposal for machine room structure is not as per M.C. bye-law.
4. Report from ME has not been received.
5. Ground floor plan for upper Block should be shown separately with the
6. The proposal falls in banned area. As per the notification received from
Govt. of H.P. vide their letter No. PBW (B&R)(B) 24(1)91-1 dated 17.4.2000,
the development activities in banned area of Shimla planning area have been
temporarily frozen. As such the proposal cannot be considered at this stage.
Hence the plan is rejected and returned herewith."
22. However, a question arose as to whether the temporary freeze of
development activities in the banned area of Shimla planning area was to apply
in relation to the cases where the building plans had already been approved by
the Government before the said date, wherefor permission had been issued to the
Commissioner, Municipal Corporation, in the following terms :
"The temporary ban on development activities in the Shimla Planning
Area was imposed by the Government on dated 17.04.2000. The building plans
approved by the Government before this date need not be detained. Therefore,
the building plan cases already cleared by the Government/Cabinet may be
processed further in accordance with the Rules and Regulations."
23. Before, however, the Corporation could consider the Respondents'
application for grant of sanction of the said development plan in terms of the
1994 Act and/or building bye-laws framed thereunder, a notification was issued
by the State of Himachal Pradesh purported to be in terms of sub- sections (4)
and 5 of Section 17 of the 1977 Act, making further amendments in the interim
development plans which was published in the gazette on 31.03.1979 and is to
the following effect :
"(a) All Private as well as Government construction are totally banned
within the core area of Shimla Planning Area. Only construction on old lines
shall be permitted in this area with the prior approval of the State
Government. The 'core area' shall comprise of the following :
'Central Shimla bounded by the circular road starting from Victory Tunnel
and ending at Victory Tunnel via Chotta Shimla & Sanjauli and the area
bounded by Mall Road starting from Railway Board Building to Ambedkar Chowk,
covering Museum Hill by a road starting from Ambedkar Chowk on the north side,
joining the chowk of the Indian Institute of Advance Studies and following the
road joining Summer Hill post office and via upper road to Boileauganj Chowk
and then joining the cart Road, along Cart Road to Victory Tunnel.
(b) No development, unless specifically permitted by the State Government
shall take place in the restricted area which shall comprise of the following :
24. Yet again a notification was issued by the State of Himachal Pradesh on
or about 22.08.2000 whereby and whereunder, for the existing Regulation
10.4.2(x)(a), the following was substituted :
"10.4.2 (x)(a), CORE AREA : (i) New construction in core area shall be
allowed in respect of residential buildings upto maximum two storeys and
ancillary used thereto with the prior permission of the State Government.
Provided that in case of reconstruction of old structured or building shall
be permitted by the State Government subject to the condition that the plinth
area and number of storeys on old lines shall remain the same as were existing
25. Regulation 10.7 provided for a 'Heritage Zone', relevant clauses whereof
read as under :
"10.7 HERITAZE ZONE :
(A) No development for reconstruction unless specifically recommended by the
Heritage Advisory Committee and permitted by the State Government shall take
place in the Heritage Zone, which shall be comprised of the following areas,
(i) Viceregal lodge complex Complete;
(ii) One building depth on either side of the road surrounding Viceregal
(iii) One building depth on either side of the Mall road starting from the
gate of Indian Institute of Advance Studies upto Chhota Shimla Chowk via State
Bank of India, Scandal Point, Shimla Club and Oak Over."
26. In view of the aforementioned amendments in the regulation declaring
'core area' and 'heritage zone' within which only the respondents had filed
their application for grant of sanction of the building plans, no order could
be passed by the appellant.
27. In view of the aforementioned notification, the application for sanction
of the building plans was ultimately rejected by the Corporation.
28. In the aforementioned premise Respondents filed a writ petition before
the High Court of Himachal Pradesh at Shimla, praying for the reliefs which
have been noticed hereinbefore. By reason of the impugned judgment, a Division
Bench of the said Court held that the purported declaration in relation to the
core area and heritage zone would not apply in the case of the writ-petitioners
in view of the fact that the building plan submitted by them before the
Director in terms of the provisions of the 1977 Act had already been allowed,
and, thus, the same had conferred a vested right in them. It was hence directed
"(a) The respondent No. 3 shall process the resubmitted building plans
furnished by the petitioners uninfluenced by the notification of the Government
dated 22.8.2002. Annexure R1/A and on the basis of the building bye-laws as
were prevalent at that time, i.e. on 17.4.2000 and shall pass the order within
four weeks from today.
(b) Needless to say, if any deficiency is found in the resubmitted plans, on
the basis of the bye-laws prevalent on 17.4.2000, the petitioner shall remove
such deficiency within a week of being pointed out by the Municipal Corporation
and the Commissioner in turn shall pass his orders within two weeks thereafter.
(c) In case the respondent No. 3 does not comply with the aforesaid
directions within the time frame noticed above, the petitioners shall be at
liberty to carry out the construction as per their resubmitted plans on
4.12.2000 in accordance with the bye-laws as in force on 17.4.2000 after giving
intimation to the Commissioner, Municipal Corporation-respondent No.
29. Appellant is, thus, before us challenging the aforesaid judgment.
30. Mr. Anil Nag, the learned counsel appearing on behalf of the appellant,
submitted that having regard to the aforementioned notifications dated
11.08.2000 and 22.08.2000, the impugned judgment could not have been passed by
the High Court.
31. Mr. A.K. Ganguli, the learned Senior Counsel appearing on behalf of the
respondents, on the other hand, raised the following contentions :
i) Having regard to the purport and object of the 1977 Act, once a building
plan is sanctioned in terms thereof, the Municipal Corporation is required to
only supervise the construction thereof in exercise of its functions under the
ii) Being a local authority, a building plan by the State sanctioned in
terms of the 1977 Act would be binding on the appellant and, thus, the same
could not have rejected; the functions of the appellants confined only to
oversee construction of the building;
iii) In view of the clarificatory circular issued by the State of Himachal
Pradesh on 25.07.2000, the building plan submitted by the respondents having
already been approved, the Municipal Corporation was bound to act thereupon
irrespective of the effect of notification dated 10.04.2000.
iv) In any event, as the application for building plans was submitted on
07.07.1999, in terms of the provisions contained in Section 247of the 1994 Act,
having regard to the fact that the said application had neither been rejected
nor accepted within a period of sixty days therefrom, the sanction of the plan
would be deemed to have been granted.
v) In any view of the matter as during pendency of the writ petition, the
Municipal Corporation granted sanction in favour of other applicants who were
similarly situated, there is absolutely no reason as to why the respondents
should have been discriminated against.
vi) Appellant being a local authority was bound to act fairly, which would
mean that they should have exercised their jurisdiction within a reasonable
time and having not done so, it does not now lie in their mouth to rely upon
the subsequent notifications issued by the State under Section 17 of the 1977
vii) Unnecessary delay was caused by the appellant-Corporation in dealing
with the respondents' application for grant of sanction for the building plans.
Hence the original sanctioned plan was only valid for a period of three years,
the same should be held to have been extended.
32. In our opinion, the 1977Act and the 1994 Act operate in different fields
and they are complementary and supplementary to each other. The provisions of
both the Acts can be worked out. There is no conflict between the two Acts. The
1977 Act deals with laying down the broad policy. It provides for preparation
of development plans including the internal development plans. Indisputably,
such development plans when made would be binding upon the local authority. It
may, however, be not correct to contend that despite the fact that the
operation of the Acts cover two different fields, namely, the 1977 Act deals
with laying down the overall policy matter and the 1994 Act deals with the
grant of building plans in terms of the provisions thereof by the Commissioner
of the Municipal Corporation; only because sanction for development in the Mall
area of the town of Shimla was granted by the State in terms of the 1977 Act,
the same would mean that the same was binding upon the Municipal Corporation or
that the provisions of the 1994 Act or the building bye-laws were not required
to be complied with at all.
33. We have noticed hereinbefore that even in the order of sanction passed
in favour of the respondents by the State, a condition was imposed that before
undertaking the development activities by way of erection of the building, the
respondents would take the requisite sanction from the Municipal Corporation.
Even if such a condition had not been imposed, the provisions of the Municipal
Corporation Act, as noticed hereinbefore, would operate.
34. Section 243 of the 1994 Act clearly mandates that erection of a building
must precede grant of express sanction of a building plan. How and in what
manner the same is required to be dealt with is provided in Sections 244 and
245 of the 1994 Act. Clause (a) of sub-section (2) of Section 246 in no
uncertain terms restrict the power of the Appellant-Corporation to grant
sanction for erection, inter alia, for development of an area by way of
erection of a building or otherwise, not only if the same is not in conformity
with the building bye-laws, but also if it contravenes any other law or rules
operating in the field.
35. The 1977 Act is one of such Act. As noticed hereinbefore, the provisions
thereof are binding upon the local authority. Once the provisions thereof are
held to be binding, the law made by the State by way of subordinate legislation
in the form of the regulations and/or notifications issued under sub-sections
(4) and (5) of Section 17 of the 1977 Act would also be binding. Indisputably,
the Municipal Corporation would not have any authority to grant any sanction in
36. Section 247 no doubt provides for a legal fiction specifying a period of
sixty days, within which the application for grant of sanction of a building
plan should be granted, but the said period evidently has been considered to be
providing for a reasonable period during which such application should be disposed
of. However, only because the period of sixty days has elapsed from the date of
filing of application, the same by itself would not attract the legal fiction
contained in Section 247 of the 1994 Act. When such an application is attended
to and the defects in the said building plans are pointed out, there cannot be
any doubt whatsoever that the applicant must satisfactorily answer the queries
and/or remedy the defects in the building plans pointed out by the competent
37. The building plans for which sanction was prayed for by the respondents,
as noticed hereinbefore, had been attended to. The purported defects were
removed, as noticed hereinbefore only on 10.04.2000. Even according to the
appellant-Corporation all the defects were not removed which had been pointed
out by the appellant-Corporation in terms of its letter dated 06.06.2000. In
any event, as noticed hereinbefore, the State of Himachal Pradesh imposed a
temporary freeze on the development activities in the Mall area by an order
dated 17.04.2000. The said order was also binding upon the
appellant-Corporation and no permission could have been granted in favour of
the respondents in violation thereof. It is true, as has been contended by Mr.
Ganguli, that the said purported temporary freeze on the construction
activities imposed in terms of the notification dated 17.04.2000 came to be
clarified by the State on or about 25.07.2000. But by reason thereof, the State
could not have directed the Municipal Corporation to grant sanction, as a
statutory authority must be permitted to perform its statutory functions in
respect whereof even any higher authority cannot issue any direction. [See
Commissioner of Police, Bombay v. Gordhandas Bhanji AIR 1952 SC 16 and Mohinder
Singh Gill and Another v. The Chief Election Commissioner, New Delhi and Others
- AIR 1978 SC 851] and R.S. Garg v. State of Uttar Pradesh and Others [(2006) 6
38. In any event, as in the meanwhile, the period for which the building
plan was sanctioned by the State had expired, the question as to whether in the
aforementioned fact situation obtaining, the respondents acquired any vested
right despite the amendments in the regulation by defining 'core area' and
providing for the heritage zone is the issue, in our opinion, is misconceived.
39. It is now well-settled that where a statute provides for a right, but
enforcement thereof is in several stages, unless and until the conditions
precedent laid down therein are satisfied, no right can be said to have been
vested in the person concerned. The law operating in this behalf, in our
opinion is no longer res integra.
40. In Director of Public Works v. Ho Po Sang [1961 AC 901 : (1961) 2 All ER
721], the Privy Council considered the said question having regard to the repealing
provisions of the Landlord and Tenant Ordinance, 1947 as amended on 9-4-1957.
It was held that having regard to the repeal of Sections 3-A to 3-E, when
applications remained pending, no accrued or vested right was derived. It was
observed therein :
"In summary, the application of the second appellant for a rebuilding
certificate conferred no right on him which was preserved after the repeal of
Sections 3-A to 3-E, but merely conferred hope or expectation that the
Governor- in-Council would exercise his executive or ministerial discretion in
his favour and the first appellant would thereafter issue a certificate.
Similarly, the issue by the first appellant of notice of intention to grant a
rebuilding certificate conferred no right on the second appellant which was
preserved after the repeal, but merely instituted a procedure whereby the
matter could be referred to the Governor-in-Council. The repeal disentitled the
first appellant from thereafter issuing any rebuilding certificate where the
matter had been referred by petition to the Governor-in-Council but had not
been determined by the Governor."
[See also Lakshmi Amma v. Devassy [1970 KLT 204]
41. The question again came up for consideration in Howrah Municipal Corpn.
and Others v. Ganges Rope Co. Ltd. and Others [(2004) 1 SCC 663], wherein this
Court categorically held :
"The context in which the respondent Company claims a vested right for
sanction and which has been accepted by the Division Bench of the High Court,
is not a right in relation to ownership or possession of any property for which
the expression vest is generally used. What we can understand from the claim of
a vested right set up by the respondent Company is that on the basis of the
Building Rules, as applicable to their case on the date of making an
application for sanction and the fixed period allotted by the Court for its
consideration, it had a legitimate or settled expectation to obtain the
sanction. In our considered opinion, such settled expectation, if any, did not
create any vested right to obtain sanction. True it is, that the respondent
Company which can have no control over the manner of processing of application
for sanction by the Corporation cannot be blamed for delay but during pendency
of its application for sanction, if the State Government, in exercise of its
rule-making power, amended the Building Rules and imposed restrictions on the
heights of buildings on G.T. Road and other wards, such settled expectation has
been rendered impossible of fulfilment due to change in law. The claim based on
the alleged vested right or settled expectation cannot be set up against
statutory provisions which were brought into force by the State Government by
amending the Building Rules and not by the Corporation against whom such vested
right or settled expectation is being sought to be enforced. The vested right
or settled expectation has been nullified not only by the Corporation but also
by the State by amending the Building Rules. Besides this, such a settled
expectation or the so-called vested right cannot be countenanced against public
interest and convenience which are sought to be served by amendment of the
Building Rules and the resolution of the Corporation issued thereupon."
42. In Union of India and Others v. Indian Charge Chrome and Another [(1999)
7 SCC 314], yet again this Court emphasized :
"The application has to be decided in accordance with the law
applicable on the date on which the authority granting the registration is
called upon to apply its mind to the prayer for registration"
43. In S.B. International Ltd. v. Asstt. Director General of Foreign Trade
[(1996) 2 SCC 439], this Court repelled a contention that the authorities
cannot take advantage of their own wrong viz. delay in issuing the advance
licence, stating :
"We have mentioned hereinbefore that issuance of these licences is not
a formality nor a mere ministerial function but that it requires due
verification and formation of satisfaction as to compliance with all the
[See also Kuldeep Singh v. Govt. of NCT of Delhi [(2006) 5 SCC 702]
44. Mr. Ganguli, however, submitted that whereas in the case of State of
West Bengal etc. v. Terra Firma Investment & Trading Pvt. Ltd. etc.,
[(1995) 1 SCC 125], the amended statute itself provided for rejection of all
pending applications, no such provision has been laid down in the notification
and, thus, the said decision is distinguishable.
45. Ganges Rope Co. Ltd. (supra) was also sought to be distinguished by Mr.
Ganguli, submitting (i) in the Howrah Municipal Corporation Act, 1980 there was
no deeming provision; (ii) the said law had been amended; and (iii) therein the
statute used the word 'ordinarily'.
46. It is difficult to agree with the aforementioned contention of the
learned Senior Counsel.
47. There cannot be any doubt whatsoever that an owner of a property is
entitled to enjoy his property and all the rights pertaining thereto. The
provisions contained in a statute like the 1994 Act and the building bye-laws
framed thereunder, however, provide for regulation in relation to the exercise
and use of such right of an owner of a property. Such a regulatory statute must
be held to be reasonable as the same is enacted in public interest. Although a
deeming provision has been provided in sub-section (1) of Section 247 of the
1994 Act, the same will have restricted operation. In terms of the said
provision, the period of sixty days cannot be counted from the date of the
original application, when the building plans had been returned to the applicant
necessary clarification and/or compliance of the objections raised therein. If
no sanction can be granted, when the building plan is not in conformity with
the building bye-laws or has been made in contravention of the provisions of
the Act or the laws, in our opinion, the restriction would not apply despite
the deeming provision.
48. A legal fiction, as is well-known, must be construed having regard to
the purport and object of the Act for which the same was enacted. [See
Ishikawajma-Harima Heavy Industries Ltd. v. Director of Income Tax, Mumbai 2007
(1) SCALE 140 Para 36].
49. It is in the light of the aforementioned principle that the question as
to whether the respondents had acquired any vested right or not must be
considered. Strong reliance, in this behalf, has been placed by Mr. Ganguli on
a decision of the Division Bench of this Court in Live Oak Resort (P) Ltd. and
Another v. Panchgani Hill Station Municipal Council and Another [(2001) 8 SCC
329]. The said decision was rendered on its own facts. In that case a building
plan had been granted; construction had been started in terms of the building
plan as also the rules which were applicable at the relevant point of time. The
question which arose for consideration therein was as to whether a subsequent
amendment to the rules, in respect of additional FSI shall have any effect on
the sanctioned building plan, it was contended that keeping in view the
environmental question, the same will have not.
50. The said decision having been rendered in the fact situation obtaining
therein, which has no similarity to the facts of the present case, which in our
opinion, cannot be said to have any application whatsoever. The submission of
Mr. Ganguli that despite expiry of the period of sanction of the development
plan by the State under the 1977 Act, the same should be held to be extended,
in our opinion, cannot be accepted. Reliance has been placed by Mr. Ganguli on
M.C. Mehta (Badkhal and Suraj Kund Lakes Matter) v. Union of India and Others
[(1997) 3 SCC 715]. Therein, it was held :
"2. No construction of any type shall be permitted, now onwards, in the
areas outside the green belt (as shown in Ex. A and Ex. B) up to one km radius
of the Badhkal lake and Surajkund (one km to be measured from the respective
lakes). This direction shall, however, not apply to the plots already
sold/allotted prior to 10-5- 1996 in the developed areas. If any unallotted
plots in the said areas are still available, those may be sold with the prior
approval of the Authority. Any person owning land in the area may construct a
residential house for his personal use and benefit. The construction of the
said plots, however, can only be permitted up to two and a half storeys
(ground, first floor and second half floor) subject to the Building
Bye-laws/Rules operating in the area. The residents of the villages, if any,
within this area may extend/reconstruct their houses for personal use but the
said construction shall not be permitted beyond two and a half storeys subject
to Building Bye-laws/Rules.
Any building/house/commercial premises already under construction on the
basis of the sanctioned plan, prior to 10-5-1996 shall not be affected by this
51. The restriction therein was imposed by the court, which was a judge- made
law and not a statute law. Relaxation, therefore, was granted keeping in view
the rights of the parties in terms of the order passed by the court.
However, in this case, we are bound by the provisions contained in a
52. In T. Vijayalakshmi and Others v. Town Planning Member and Another
(2006) 8 SCC 502], although exercise of jurisdiction by a statutory authority
within a reasonable time has been emphasized, but there again the applicability
of existing law has been emphasized referring to Ganges Rope Co. Ltd. (supra)
and Ho Po Sang (supra). The said decision was rendered having regard to the
fact that only a proposal of amendment was made, and no amendment as such had
come into effect. A right of a citizen under a statute, therefore, could not have
been taken away only because a proposal was in the offing. In that case, the
State had not given its final approval having regard to the development of the
plan. The said decision, therefore, cannot be said to have any application in
the instant case.
53. Furthermore, since special regulations have been framed in the town of
Shimla, the core area as provided for in the regulation is required to be
protected. The area in question has been declared to be a heritage zone, and
hence no permission to raise any construction can be issued, which would
violate the ecology. Such regulations have been framed in public interest.
Public interest, as is well-known, must override the private interest. [See
Friends Colony Development Committee v. State of Orissa and Others AIR 2005 SC
1 para 22].
54. For the reasons aforementioned, the impugned judgment cannot be
sustained, which is set aside accordingly. The appeal is allowed. In the facts
and circumstances of the case, however, there shall be no order as to costs.