Shiv Sagar
Tiwari Vs. Union of India & Ors [1996] INSC 1424
(8 November 1996)
Kuldip
Singh, B.L. Hansaria
ACT:
HEAD NOTE:
O R D
E R
One of
the issues for consideration before this Court in this public interest petition
is the validity of the allotments of 52 shops/stalls made by Smt. Shiela Kaul
the then minister for Housing land Urban development, Government of India.
While
monitoring this case, this court has passed various interim orders from time to
time. It would be useful to quote three such orders. The relevant part of the
order dated April 17,
1996 is as under:
"The
material placed before us inter alia, discloses that 41 shops\stalls allotted
on July 3, 1995 were in total contravention of the
rules/policy approved situated in Lodhi Road Complex - I & II. Hanuman Road
Market. Baba Kharak Singh Marg market, DIZ area Market, and Pleasure Garden near Lajpat Nagar Market. The material on the record
further shows that the said 43 shops/stalls were allotted by Smt. shiela Kaul
without issuing any public notice/inviting applications from the eligible
persons which was in violation of the policy formulated by her on December 26, 1994. The material also discloses that
orders of allotment in respect of said 41 shops/stalls were passed by Smt. Shiela
Kaul on June 7, 1995 (5 shops and 36 stalls). The
material further discloses that all the six shops have been allotted by her to
her own relations/employees/domestic servants of her family members and family
friends. She has allotted two shops to her two grand-sons, one shop to the maid
servant of her son. Shri Vikram Kaul, who is residing in Dubai. One shop to Handloom Manager of
the firm, owned by her son-in-law and another shop to a close friend. One shop
has been allotted to the nephew of her minister of state, Shri P.K. Thungon. It
is further on the record that while making allotments in respect of stalls she
has allotted most of the stalls to the relations, friends of her personal staff
and officials of Directorate of Estate. The details and the names of Estate.
The details and the names of allottees and their relationship have also been
placed on the record." The relevant part of the order dated July 19, 1996 is as under:
"Mr.
N N. Singh, Superintendent of Police, CBI, New Delhi has placed on record
interim report No. 3 dated June 17, 1996 and Interim Report No. 4 dated July
separate preliminary enquiry was registered against Smt. Shiela Kaul and others
in the matters of allotment of shops/stalls made by her on June 7,1996 and July
3, 1995 in favour of her close relations/friends of her personal Estate.
According to the report, the preliminary enquiry, prima facie, establishes that
Smt. Shiela Kaul had abused her official position as the Minister for Urban
Development and she had entered into a criminal conspiracy with some of the
acquaintances and her personal staff, pursuant to which she in abuse of her
official position made these allotments and caused wrongful loss to the
Government by effecting allotments on economical licence fees basis without
inviting any tender or by issuing public notice for inviting the response from
the general public from the point of view of earning maximum revenue for the
Government. A regular case under Section 120-B, 420, 468/471 IPC and Section
13(2) read with 13(1) (d) of the Prevention of Corruption Act, 1988, has been
registered against Shiela Kaul and her additional Private Secretary Rajan S. Lala
and others.
The
order dated September
6, 1996 to the extent
relevant is as under:
"Pursuant
to this Court`s order dated July 19, 1996, the Director of Estates has filed
its report along with an affidavit regarding the shops and stalls allotted by Smt.
Shiela Kaul. It is stated that from 1992 onwards 52 shops have ben sanctioned
by the then Minister for Urban Development (Smt. Shiela Kaul) out of which 7
shops were allotted by Smt. Shiela Kaul before she herself had approved the
policy in 1994 for disposal of the shops on tender basis. It is further stated
in the affidavit that 45 shops were allotted by Smt. Shiela Kaul after 1994 in
violation of the policy framed by the Ministry.
The gist
of the objections filed by the various allottees have been enclosed along with
the affidavit.
Before
any action is taken, we consider it appropriate to give an opportunity of
hearing to all these persons. We, therefore, direct the Director of estates to
issue individual notices to these 42 persons to be personally present in this
Court or through their counsel to argue their point of view in respect of their
objections on 27th
September, 1996 at 2 PM. They shall show cause to this Court why their allotment be
not cancelled and why they be not burdened with damages." This Court by
the judgment dated October
11, 1996 has come to
the conclusion that the allotments of the said 52 shops/stalls made by Smt. Shiela
Kaul were arbitrary, discriminatory, unconstitutional and as such were liable
to be quashed. This Court quashed the said allotments on the following
reasoning:
"The
CBI has since inquired into the matter in some detail and has by now submitted
4 Interim Reports. According to the CBI, orders of allotment in respect of the
shops/stalls in question were passed by Smt. Shiela Kaul, the then Minister of
Urban Development and " all the 6 shops have been allotted by her to her
own relation/employees/domestic servants of her family members and family
friends. She has allotted 2 shops to her 2 grandsons, one shop to the
maidservant of her shop to sh. Vikram Kaul who is residing in Dubai, one shop to handloom manager o the
firm owned by her son-in-law and another shop to a close friend. One shop has
been allotted to the nephew of the minister of State, Sh. P.K. Thungon. While
making allotments in respect of stalls, she has allotted most of stalls to the
relations/friends of her personal staff and officials of Dte. of Estate."
The CBI has also reported that Smt. Shiela Kaul had made ten different
categories of persons as the basis for deciding allotments, but even this categorisation
was not adhered to while making allotments.
The
further findings are;
(1)
Many other Organisations/persons who had also applied for allotment of
shops/stalls from time to time were not considered for allotment of
shops/stalls to them": and
(2) -
"At the time of discretionary allotments made by Smt. Shiela Kaul in 1992
and 1994 persons who were relations of her personal staff were considered and
allotted shops......"
Question
is whether they were selected in accordance with law, which aspect as its
importance because apparently a large number of other persons could as well
fall within the categories in question and had applied also? From the report of
the CBI it is clear that the allottees had been selected, not by following the
tender system, as required by the policy of 1994, but because of their
relationship with the minister or her personal staff, or being employees or
friends of such persons. If that be so, the allotments were wholly question is
what is required to be done to undo the wrong and how the wrong doer is to be
dealt with within the parameters known to law." Finally in para 18 of the
judgment, this Court directed as under :
Secondly,
Smt. Shiela Kaul, who was prima facie personally responsible for the illegal
allotments, has to be asked to show cause as to why damage should not be
awarded against her for her alleged misuse of power. So, a notice be issued to
her to show cause why she should not be asked to pay such sum as damages, for
each of the illegal allotments made by her, as this Court would deem just and
proper. The cause would be shown within three weeks of the receipt of this
order." Pursuant to the above quoted directions, a show cause notice was
issued to Smt. Shiela Kaul. She has filed affidavit in reply to the show cause
notice.
Smt. Shiela
Kaul was arrayed ass respondent in the writ petition. This Court has been
monitoring this case for a period of about 2 years. Various interim orders were
passed from time to time. Despite ample opportunity available to her Smt. Shiela
Kaul did not choose to file any counter- affidavit in this Court. Dr. Rajiv Dhawan,
learned counsel appearing for Smt. Shiela Kaul has very fairly stated that her
client cannot take her case higher than what has ben stated in the affidavit
filed on behalf of the Union of India. The learned counsel has relied upon para
6 & 7 of the affidavit dated September 6, 1996 filed by Harcharanjeet Singh, Director of Estates, Ministry
of Urban Affairs and Employment. On behalf of Union of India. The said paras
are as under :
"6.
That the Ministry of Works & Housing (renamed as ministry of Urban Affairs
& Employment) on 24th March, 1979 had issued the policy to be adopted for
development, and construction of shopping centres in various Government
colonies in Delhi. A copy of the Office Memorandum issued in this regard is
given as Annexure-R-V. The salient features of the policy are indicated as
follows.
i) The
shops under construction in convenient/local shopping centres in the sanctioned
scheme would be sold by auction by the Land & Development Officer after
fixing minimum reserve price in consultation with the Finance Division.
ii) In
respect of the shopping centres which are to be constructed in various colonies
the L & DO would auction the sites for various purposes on perpetual
leasehold basis.
iii)
Such shops that are constructed multistorey buildings would be taken in the
books of Director of Estates would allot the same on licence, fee basis.
iv)
While the above was the general policy to be adopted in future (after 24th March, 1979) exceptions may be made if the
circumstances so warranted.
7. The
records of the Director of Estates indicate that after the issue of these
instructions in March 1979, the Office of L & D O has not been able to
auction any shops in any of the shopping centres in Government colonies,
despite the efforts made by the Office of L & D O was considered too high
and no bidders came forward for auction of shops. At present, have been taken
by various Ministers to allot the shops on licence fee basis are with the
Central Bureau of Investigation. In the absence of records which were not the
exact position in respect of each shop which has been given on licence fee
basis after the policy as indicated above came into force. However, on the
basis of the individual files it is observed that in January, 1986, 5 shops
were given on licence fee basis by the then shops were allotted on licence fee
basis by the then minister (Smt. Mohsina Kidwai). Thereafter, from 1992 onwards
52 shops have been sanctioned by the then minister for Urban Development (Smt Shiela
Kaul) out of which 7 shops were allotted by Smt. Shiela Kaul before she herself
had approved the policy in 1994 for disposal of the shops on tender basis.
8.
Break-up of the shops allotted by Smt. Shiela Kaul, the then Minister during
her tenure is as follows:
Shops
allotted from 1992 to 1994 7 (Before the Policy of giving the shops on tender
basis was approved).
Shops
allotted after 1994 policy 45 was laid down.
Shops
not accepted by the allottees 9 The contents, quoted above, only give the
factual position pertaining to the allotment of shops/stalls during the period
from 1979 onwards. It is further obvious that Smt. Shiela Kaul herself framed
the Policy in 1994 for disposal of the shops on tender basis but did not follow
the same. At this stage it would be instructive to quote the explanation given
by Smt. Shiela Kaul in her affidavit in reply to the show cause notice to the
allegation that she allotted shops to her two grand children, friends, and
relations:
"In
any case, the allegations are wrong in material particulars in that- In respect
to the 2 shops to her grandsons, she was not aware at that time because the
name in the list were Vivek Kumar & Ashish Kumar and the addresses were of
Delhi of which she was not aware. The shop allotted to maid servant of her son Vikram
Kaul, she was not aware of her name and addresses in the statement given to
her. She comes from a weaker section of society and comes under Schedule
Tribes." We do not wish to comment except that we are at pains to read the
above quoted stand taken by a person who has held high offices like Central
Minister and Governor.
This
Court in Common Cause A Regd. Society vs. Union of India & Ors. Writ
Petition (C) 26 of 1995 (Capt. Satish Sharma's case) decided on November 4,
1996 relied upon this Court's judgment in Nilabati Behera (Smt.) Alias Lalita
Cases 1129 and the judgment of the Court of Appeal in A.B.
Bench
507 and held as under:
"We
are of the view that the legal position that exemplary damages can be awarded
in a case where the action of a public servant is oppressive, arbitrary or
unconstitutional is unexceptionable." Even in the judgment dated October
11, 1996 by which show cause notice was issued to Smt. Shiela Kaul, this Court
referred to various judgments of different Courts from different countries in
the world and has held that a public servant is liable to exemplary damages for
his acts which are oppressive, arbitrary or unconstitutional.
The
question for consideration, however, is whether the action of Smt. Shiela Kaul,
as discussed in detail in our judgment dated October 11, 1996 (relevant part
quoted above) and also in various interim orders quoted above, makes her liable
to pay exemplary damages. After gibing our thoughtful consideration to the
material on record and in particular the findings of this Court- quoted above-
the answer has to be in the affirmative. Smt. Shiela Kaul's action was wholly
arbitrary, malafide and unconstitutional. This Court has given clear finding in
the judgment/orders quoted above to this effect. We, therefore, hold that Smt. Shiela
Kaul is liable to pay exemplary damages.
We
have heard Dr. Rajiv Dhawan, Mr. Kapil Sibal, Mr. Altaf Ahmad, learned
Additional Solicitor General and Mr. Shiv Sagar Tiwari on the question of
quantum. Dr. Dhawan has stated that Smt. Shiela Kaul has followed the same
Policy which was being followed by her predecessors in office. Mr. Kapil Sibal
has contended that exemplary damages should be awarded for public injury caused
as a result of arbitrary exercise of power on the part of Smt. Shiela Kaul. He
has, however, contended that so far as the allotments made by her are
concerned, in the facts and circumstances of the case, exemplary damages are
not called for. Mr. Sibal has based his contention on the assumption that if
the allotments were to be made to the persons belonging to the weaker sections
of the society, then, there would not have much gain to the State Exchequer.
There is nothing on the record to show that if the allotments were to be made
only to weaker sections or to any category of persons. In any case Smt. Shiela Kaul
did not follow any Policy or criteria. Allotments w e re made by her in an
arbitrary and illegal manner.
We may
mention that this Court in the order dated November 4, 1996 concerning Capt. Satish Sharma
awarded Rs.50 lacs as damages for his actions which were arbitrary, malafide
and unconstitutional.
After
examining all the facts and circumstances of the case and giving our thoughtful
consideration to this aspect.
We
direct Smt. Shiela Kaul to pay a sum of Government Exchequer. Since the
property with which Smt. Shiela Kaul was dealing was public property, the
Government which is "by the people: has to be compensated. We further
direct Smt. Shiela Kaul to deposit the amount with the Secretary, ministry of
Finance, Government of India within nine months from today. The amount if not
paid, shall be recoverable as arrears of land revenue.
Before
parting with this order, we make it clear that the CBI. Which is separately
investigating the matter, shall not be influenced by any observations made by
this Court for reaching the conclusion as to whether any prima facie case for
prosecution/trial is made out against Smt. Shiela Kaul.
It
shall have to be decided on the basis of the material collected and made
available with the CBI as a result of the investigation.
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