Mohali Area Dev. Authority & Ors Vs. Manju Jain & Ors.  INSC 649
(19 August 2010)
SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 6791 OF
2010 (Arising out of SLP (C) No. 6427 of 2008) Greater Mohali Area Development
Authority & Anr. ...... Appellants Versus Manju Jain & Ors.
This appeal has been preferred against the judgment and order
dated 22.11.2007 passed by the High Court of Punjab and Haryana at Chandigarh,
in Civil Writ Petition No. 16621 of 2007, by which the High Court has set aside
the judgments and orders of the Revisional Authority dated 31st July, 2007 and
the Appellate Authority dated 30th March, 2006 and the order of cancellation of
the suit plot dated 20th August, 2003 by the statutory authority.
Facts and circumstances giving rise to this case are that the
respondent No.1 applied vide application No.026012, dated 27.1.1997, for allotment
of a flat under a hire purchase scheme along with application money of
Rs.20,000/-. After considering the application of the respondent No.1 along
with other applicants, a draw of lots was held on 28.6.1997 and an M.I.G. flat
was allocated to the respondent No.1 and she was informed vide letter dated
19.11.1997 about the said allocation. As per the said allocation letter, the
allotment was for a tentative cost to the tune of Rs.4,79,200/-. Respondent
No.1 would deposit a further 15% of the price of the flat within 30 days of the
issuance of the allotment letter and the balance amount was to be deposited in
equal monthly installments over a period of 13 years. It was also open for her
to make payment of the balance amount in a lump sum within 60 days from the
date of issue of the allotment letter. The authority issued the letter of
allotment dated 9th March, 1999 in her favour, which made it clear that the
price of the house was Rs.5,55,200/- and that she had to send her acceptance of
the 2 allotment and deposit 25% of the amount within 60 days of the receipt of
the allotment letter. She had to deposit the balance amount in monthly
installment over a period of 13 years. The respondent No.1 did not make any
response to the said letter nor did she deposit any amount. The appellant-
authority on her query vide letter dated 28th August, 2003, informed the
respondent No.1 that the allotment made in her favour stood cancelled, as she
did not deposit any amount in pursuance of the allotment letter dated 9th March,
Being aggrieved, respondent No. 1 preferred an appeal before the
Estate Officer of the appellants challenging the order of cancellation. The
said appeal was dismissed vide order dated 30th March, 2006, against which the
respondent No.1 preferred a revision which was also dismissed by the Revisional
Authority vide order dated 31.7.2007.
Being aggrieved, respondent No. 1 preferred Writ Petition No.16621
of 2007 challenging the orders passed by the authorities of the appellants, as
well as the State Government.
The writ petition has been allowed quashing all the orders 3
passed by the authorities of the appellants and of the State of Punjab. Hence,
Mr. Satinder S. Gulati, learned counsel appearing for the
appellants, has submitted that the respondent No.1 was sent the letters of
allocation as well as the allotment by Registered Post. She did not send her
acceptance nor did she deposit any amount whatsoever and she filed an appeal
wherein she did not take the ground that she had not received the letter of
allotment. Respondent No. 1 had made very vague pleadings stating that she had
not heard anything from the appellants after depositing the application fee.
She failed to make any deposit at any stage and the High Court has wrongly
proceeded as if she did not have any notice of the allocation or allotment. The
High Court summoned the officer of the appellant-authority and quashed the
order of cancellation and all other consequential orders only on the ground
that the allotment letter had not been sent to the correct person at correct
address, placing reliance upon the receipt and dispatch register of the
authority alone. The appellant- authority was not given a proper opportunity to
file a reply to 4 the writ petition. Thus, the order impugned passed by the
High Court is liable to be set aside.
On the other hand, Shri Govind Goel, learned counsel appearing for
the respondents, has submitted that greater injustice has been done to the
respondent by the authorities, as in spite of the order of allotment, the
allotment had been cancelled without issuing any show cause notice to her or
sending any information whatsoever. The High Court has rightly taken note of
the fact that the notice was sent to an incorrect person and to the incorrect
address. Therefore, the order of the High Court does not warrant interference.
The appeal lacks merit and is liable to be dismissed.
We have considered the rival submissions made by learned counsel
for the parties and perused the record.
The Appellate Authority, after considering the pleadings,
appreciating the evidence on record and hearing both the parties, came to the
conclusion that respondent No. 1 did not deposit the required amount and did
not execute the hire- purchase agreement and she failed to give any cogent
reason for the same. The appeal was rejected.
Before the Revisional Authority, no factual foundation had been
laid by respondent No. 1 on relevant factual aspects, particularly, on the fact
that she had not received the allotment letter. The only relevant ground reads
due to some financial difficulties, the applicant-petitioner could not arrange
the huge sum of Rs.1,19,800/- to be paid within the stipulated period. The
applicant-petitioner also approached some banks for loan but the Bank
Authorities did not agree to grant loan for the purpose. However, now the
applicant- petitioner has arranged funds for the purpose and is willing and
ready to make the payment at any time."
revision was dismissed by the Revisional Authority vide order dated 31.7.2007.
This ground impliedly amounts to admission that respondent No. 1
was fully aware of her liability and she could not fulfill the requirement only
for non-availability of funds.
that she had not received the allotment letter was neither pleaded before the
Appellate Authority nor before the Revisional Authority. Thus, there was no
occasion for either of the said authorities to record a finding on this factual
In the writ petition filed on 25-10-2007 before the High Court, a
totally new case was built up on a new factual matrix, i.e. that respondent No.
1 had never received the allotment letter and after waiting for a long time
when she made a representation to the authorities, she was informed that
allotment made vide letter dated 9.3.1999 has been cancelled vide order dated
The Writ Petition came for admission before the High Court on
29.10.2007, wherein the following order was passed:- "Let concerned
records be produced by Greater Mohali Area Development Authority, Mohali on
12.11.2007. Copy of the order be given dasti under the signature of Bench
When matter came up on 12.11.2007 before the High Court, the
appellants herein did not appear, and thus, the Court passed the following
order:- "Accordingly, Special Secretary to Govt. of Punjab, Department of
Housing and Urban Development, Mini Secretariat, (ii) Chief Administrator,
Greater Mohali Area Development Authority and (iii) Addl. Chief Administrator
of Punjab Urban Planning & Development Authority, Mohali, are directed to
remain present in Court on 22.11.2007 to 7 explain reasons for disobeying order
dated 29.10.2007 of this court.
A copy of
this order be given to Mr. A.G. Masih, Senior Deputy Advocate General, Punjab
for ensuring compliance."
The officers of the appellants received the order dated 29.10.2007
on 13.11.2007 and that is why, they did not enter appearance and none of their
officers could be present in the Court on 12.11.2007. To this effect, an
affidavit was filed on 20.11.2007. A specific plea was taken therein that the
allotment letter was sent to respondent No. 1 at the correct address under
registered cover as was recorded at serial no.364 of the Register for dispatch
of registered letters and on which the stamp of the Post Officer, SAS Nagar,
dated 11.3.1999 had been affixed along with 11 other registered letters
dispatched on that date. Photocopies of those allotment letters were appended
along with affidavit. It was further submitted that the letter of cancellation
was also sent to the same address where the allocation and allotment letters
had been sent.
The matter came up before the Court on 22.11.2007 when the writ
petition filed by the respondent No. 1 stood allowed without examining the
entire record placed before the Court, only on the ground that the dispatch
register did not contain the correct name and address of respondent No.1.
petition was finally allowed by the High Court within a period of 26 days of
its filing without giving any proper opportunity to the present appellants to
file a reply and produce material to controvert the averments made in the writ
The High Court failed to note that the appellants had taken a
specific plea that the letter of allotment had been communicated to respondent
No. 1 by Registered Post. The 1918 PC 102, held that there can be a presumption
of receipt of a letter sent under postal certificate in view of the provisions
of Section 114 Ill.(f) of the Indian Evidence Act, 1872
(hereinafter the Evidence Act).
SC 1191, this Court dealt with the issue of 9 presumption of service of letter
sent under postal cover, and observed:- "The certificate of posting might
lead to a presumption that a letter addressed to the Assistant Collector of
Customs was posted on 14-8-80 and in due course reached the addressee. But it
is only a permissible and not an inevitable presumption. Neither Section 16 nor
Section 114 of the Evidence Act compel the Court to draw a presumption. The
presumption may or may not be drawn. On the facts and circumstances of a case,
the Court may refuse to draw the presumption.
other hand, the presumption may be drawn initially but on a consideration of
the evidence, the Court may hold the presumption rebutted."
SCC 555, this court re-iterated a similar view that Section 27 of General Clauses Act,
1897 and Section 114 Ill.(f) of the Evidence Act,
give rise to a presumption that the service of a notice has been effected when
it is sent to the correct address by registered post. This Court held as under
:- "Section 27 gives rise to a presumption that service of notice has been
effected when it is sent to the correct address by registered post.........
Unless and until the contrary is proved by the addressee, service of notice is
deemed to have been effected at the time at 1 which the letter would have been
delivered in the ordinary course of business."
This Court has reiterated a similar view in Gujarat AIR 1989 SC
1433; Chief Commissioner of Income Tax Authority (2007) 13 SCC 154; Sarav
Investment & Financial Shipping Indian Office Staff Provident Fund &
Anr. (2007) Development Authority & Anr. AIR 2009 SC 1233.
In view of the above, the High Court ought to have examined the
issue in the correct perspective, as respondent No. 1 did not controvert the
plea taken by the appellants of sending the allotment letter by Registered
Mere draw of lots/allocation letter does not confer any right to
allotment. The system of draw of lots is being resorted 1 to with a view to
identify the prospective allottee. It s only a mode, a method, a process to
identify the allottee i.e. the process of selection. It is not an allotment by
itself. Mere identification or selection of the allottee does not clothe the
person selected with a legal right to allotment. (See Delhi 1995 SC 1).
Constitution Benches of this Court in Bachhittar Singh that an
order does not become effective unless it is published and communicated to the
person concerned. Before the communication, the order can not be regarded as
anything more than provisional in character.
view has been reiterated in Union of India & (2002) 8 SCC 443.
Maharashtra & Anr. (2003) 5 SCC 413, this Court held that the order of the
authority must be communicated for conferring an enforceable right and in case
the order has been passed and not communicated, it does not create any legal
right in favour of the party.
view of the above, it can be held that if an order is passed but not
communicated to the party concerned, it does not create any legal right which
can be enforced through the court of Law, as it does not become effective till
it is communicated.
Clause 4 of the allotment letter reads as under:- "In case
you accept this allotment, you should send your acceptance by registered post
along with amount of balance of twenty five percent of price within sixty days
from the date of receipt of allotment letter." (Emphasis added) In the
instant case, an acceptance letter had not been sent by respondent No.1. Thus,
the allotment in her favour remained of no significance.
The respondent No.1 raised the plea of non-receipt of the letter
of allotment first time before the High Court. Even if it is assumed that it is
correct, the question does arise as to whether such a new plea on facts could
be agitated before the Writ Court. It is settled legal proposition that pure
question of law can be raised at any time of the proceedings but a question of
fact which requires investigation and inquiry, and for which no factual
foundation has been laid by a party before the Court or Tribunal below, cannot
be allowed to be agitated in the Writ Petition. If the Writ court for some
compelling circumstances desires to entertain a new factual plea the court must
give due opportunity to the opposite party to controvert the same and adduce
the evidence to substantiate its pleadings. Thus, it is not permissible for the
High Court to consider a new case on facts or mixed question of fact and law
which was not the case of the parties before the Court or Das (D) through Lrs.,
(1999) 7 SCC 303; Vasantha 1 of West Bengal, (2009) 14 SCC 406; and Sanghvi SCC
instant case, as the new plea on fact has been raised first time before the
High Court it could not have been entertained, particularly in the manner the
High Court has dealt with as no opportunity of controverting the same had been
given to the appellants.
The High Court, instead of examining the case in the correct perspective,
proceeded in haste, which itself Punjab AIR 2010 SC 1237).
SCC 130, this Court held that cancellation of an allotment should be a last
resort. The allotment should not be cancelled unless the intention or motive on
the part of the allottee in not making due payment is evident. The drastic 1
power of resumption and forfeiture should be exercised in exceptional cases but
that does not mean that the statutory rights conferring the right on the
authority should never be resorted to. In exceptional circumstances, where the
allottee does not make any payment in terms of allotment, the order of
cancellation should be passed. Sympathy or sentiment by itself cannot be a
ground for passing an order in favour of allottees by the courts nor can an
order be passed in contravention of the statutory provisions.
the instant case is examined in the light of the aforesaid settled legal
propositions, it becomes clear that respondent No.1, did not make any response
whatsoever after applying for allotment. No explanation could be furnished by
respondent No.1 for why she kept quiet for 4= years after receiving the
allocation letter and why she did not make any attempt to find out what had
happened to her application.
No.1 did not send her acceptance of the allotment;
deposit the amount which became due in 1999 itself;
not execute the required hire-purchase agreement with the appellant-authority.
Thus, it is solely for her that no 1 concluded contract came into existence
between the parties.
In such a
fact-situation, the respondent No.1 could not be handed over possession of the
flat. The forfeiture of the earnest money is in terms of the statutory
deciding the writ petition, the High Court did not even consider the well
reasoned judgments/orders by the authorities under the Statute. The Court was
supposed to examine the correctness of those orders. More so, the relevant
record of the authority was not examined.
reason, leave alone a cogent reason has been given by the High Court for the
reversal of these orders.
High Court while deciding the case did not give opportunity to the authority to
file a reply to the writ petition.
proceeded in haste and decided the case relying upon irrelevant materials. An
appropriate course may be to set aside the Judgment and order of the High Court
and remit it for consideration afresh. However, as a period of 13 years has
already been elapsed, since the proceeding came into existence and we ourselves
have examined the entire record 1 and re-appreciated the evidence, such a
course would not serve any purpose.
view of the above, the appeal is allowed. The judgment and order of the High
Court is set aside and the orders passed by the authorities under the statute
are restored. No order as to costs.
..................................J. (P. SATHASIVAM)