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Wednesday, August 29, 2012

As far as the land meant for the Children’s amusement park is concerned, the same was hardly put to the full use. In as much as this entire parcel of land of about 7 acres was not utilized, and since it was an open parcel of land, there was nothing wrong in the State Government deciding to retain it as an open parcel of land, and to change the land-use thereof from commercial to a regional park. The notification cannot be faulted on that count either. 27. In the circumstances, we do not find any error in the impugned judgment of the High Court. The appeal is therefore dismissed. Parties will bear their own costs.


                                 Reportable

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION


                       Civil  Appeal  No. 6105 OF 2012
                   (Arising out of SLP No. 16416 OF 2011)


Mangal Amusement Park (P) Ltd. & Anr.                    ...    Appellants

                                   Versus


State of Madhya Pradesh & Others                   ...         Respondents









                          J  U  D  G  E  M  E  N  T

H.L. Gokhale J.

            Leave granted.

2.          This appeal by special leave seeks  to  challenge  the  judgment
and order dated 19.5.2011  rendered  by  a  Division  Bench  of  the  Madhya
Pradesh High Court dismissing the Writ Petition bearing  No.5698/2008  filed
by the appellants herein.  The said petition sought to challenge the  change
of land-use from ‘commercial’ to a ‘regional  park’  of  a  parcel  of  land
which had been allotted to the appellants in the  town  planning  scheme  of
Indore, and also the decision of the State  Government  that  the  concerned
land be utilized only after inviting fresh tenders.

3.          The first appellant herein is a  Company  registered  under  the
provisions of the Companies Act, 1956,  and  the  second  appellant  is  its
Managing Director.  The respondent No.1 to  this  appeal  is  the  State  of
Madhya Pradesh through its Principal Secretary, Department  of  Housing  and
Environment, Bhopal, whereas the respondent No.2 is  the  Director  of  Town
and Country Planning of  Madhya  Pradesh.   The  third  respondent  to  this
appeal is  Indore  Development  Authority  (“IDA”  for  short)  through  its
Chairman, whereas the fourth respondent is the same  Authority  through  its
Chief Executive Officer.  Shri Ranjit  Kumar,  learned  senior  counsel  has
appeared for the appellants.  Shri Vikas Singh, learned senior  counsel  has
appeared for  the  first  two  respondents,  and  Ms.  Vibha  Datta-Makhija,
learned counsel has appeared for respondent no.3 and 4.

      Facts leading to this appeal:-

4.   During November 1991 to February  1992,  IDA  floated  tenders  through
advertisements for setting up of an amusement  park  on  a  parcel  of  land
owned  by  it  situated  in  village  Bhamori-Dubey.   The  concerned   land
admeasured about seven acres  comprising  of  survey  nos.  91  part,  92/1,
93/1, 93/2, 94/1, 94/2, 95/1, 95/2, 96/1, 96/2, 152,  155  part,  157,  159,
160, 162, 163, 164 part, 165 part and  166  part  and  was  situated  within
Scheme  No.54.   There  is  no  dispute  that  under  the  then   subsisting
Development  Plan  the  designated  land-use  of  these  survey   nos.   was
‘commercial’.  It is the case of the appellants that though they applied  in
pursuance to the advertisement, and though  the  appellants  were  the  most
eligible, IDA arbitrarily delayed the acceptance of their tender.  This  led
the appellants to file an earlier writ petition in the High Court of  Madhya
Pradesh bearing M.P. No.313/1992  which  was  allowed  by  the  High  Court.
Consequently, the appellants were allotted  this  parcel  of  land  for  the
establishment of a Children’s amusement park.

5.          Accordingly, IDA granted a license to the appellants, the  terms
and conditions of which were as follows:-
                 “           LICENSE
                       (FOR AMUSEMENT CENTRE)
                                             Dated 6.5.1994

           This license is granted  to  Shri  Ramesh  Mangal  son  of  Shri
           Manikchand Mangal age 48 years, resident of  8/2,  New  Palasia,
           Indore, Managing Director, M/s Mangal Amusement Park Pvt.  Ltd.,
           Indore, by  the  Indore  Development  Authority  Indore  (M.P.).
           Terms and conditions of this license shall be as follows:-

                 TERMS AND CONDITIONS:-

           The land measuring 7 acres is given to M/s Mangal Amusement Park
           Pvt. Ltd. (hereinafter called the ‘Licensee vide letter  No.4179
           dated 4.4.1994 on license by the  Indore  Development  Authority
           initially for a period of 15 years.  The licensee will  have  to
           develop inside infrastructure such as path-ways, roads, boundary
           walls, land installation of rides and games etc. at his own cost
           as approved by the Authority.  Construction of Food & Beverage’s
           Centres, Kiosks, Shops, Administrative  building,  toilet  shall
           also be permissible as per requirement.

           2.    The period of license shall  commence  from  the  date  of
           activation of the park or 18 months  from  the  date  of  giving
           possession, whichever is earlier.

           3.    The period of completion of the project shall be 24 months
           (inclusive of Monsoon season) from the date of handing over  the
           possession of the said land.  Failing which, the license may  be
           terminated, forfeiting the Earnest Money and other payments,  if
           any, by the Authority.

           4.    The advance license fee shall be payable  annually  before
           first of June.  In case, the licensee fails to pay the fee on or
           before the due date, an interest at the rate of  18%  per  annum
           shall be charged for period defaulted.  The  interest  shall  be
           calculated on the license fee itself for full calendar month.

           5.    In addition to the license fee, an amount equal to 25%  of
           the entry fee will be charged by the I.D.A. and has to  be  paid
           by the licensee by 10th of next month.

           6.    Earnest Money of Rs.1,00,000/- has been kept  with  I.D.A.
           and no interest shall be given on the amount of  Earnest  Money.
           This amount shall be adjusted towards  license  fee  1,81,000.00
           (Rs. One Lac eighty thousand only) per year on commission of the
           project.

           7.    The Authority or an  officer  authorized  in  this  behalf
           shall have the power to examine the accounts  of  collection  of
           entry fee, as and when deemed fit.  The  Authority  may  further
           regulate the mode of collection  of  entry  fee.   The  duty  of
           collection of entry fee will rest on the licensee himself.

           8.    The license may be renewed for further period of 15  years
           by enhancing the license fee, maximum by 40% and  thereafter  at
           such a percentage as may be decided by the Authority.

           9.    Bank Guarantee of Rs.5,00,000/- (Rs. Five lacs only) given
           by the licensee shall be redeemed  after  three  complete  years
           from the date of activation of the amusement park.

           10.   The rides, games etc. should be bought from the  suppliers
           manufacturing these in India indigenously.

           11.   At least one roller coaster, one  ferries  wheel  and  bay
           train, one set of merry cups, one Columbus  and  one  telecombat
           must be erected with other rides.

           12.   The  complete  amusement  centre  shall  be  operated  and
           managed  by  the  licensee  himself  at   his   own   cost   and
           responsibilities.

           13.   In the event of any increase or decrease in  the  area  on
           physical measurement, the license fee shall be  subject  to  the
           increase or decrease proportionately.







           14.   In the  event  of  violation  of  any  of  the  terms  and
           conditions mentioned hereinabove, on the part of  the  licensee,
           the decision of the Chairman, Indore Development Authority shall
           be final.

           15.   Land for which licnese  is  granted  is  marked  in  green
           colour in………. plan.

                                        SIGNATURE OF LICENSEE”



6.          It is the case of the appellants that they submitted the  plans,
maps and drawings for necessary construction, and thereafter  started  using
the concerned parcel of land as amusement park.

7.          It so transpired that  sometime  in  December  1999,  respondent
nos.1 and 2 i.e. the  State  and  the  Town  Planning  Dept.  initiated  the
process of modification of the Development Plan.  In  that  process  it  was
proposed to change the user of this parcel  of  land  from  ‘commercial’  to
‘regional park’ (i.e. a green area).  The Chairman of IDA however, wrote  in
that context to the respondent nos.1 and 2 on 7.12.1999 that such  a  change
was not desirable, since the use of the concerned land was  already  secured
for a specified  purpose  in  the  master  plan.  The  State  Govt.  however
proceeded to issue a notification on 9.3.2001  under  Section  23-A  (2)  of
Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973 (M.P. Act for  short)
proposing the change of the land-use from ‘commercial’ to  ‘regional  park’,
and inviting  objections  thereto.   The  appellants  did  raise  objections
against  the  proposed  modification  which  were  heard  by  the  Principal
Secretary to the Govt. of Madhya Pradesh on 23.8.2001.

8.          It is the case of the appellants that they wanted to  put  up  a
banquet hall and an amusement club on this parcel  of  land,  and  therefore
sought the requisite permission from IDA.  IDA in fact passed  a  resolution
bearing No. 133 on 8.5.2003 recommending grant  of  such  permission  though
subject to the conditions mentioned therein.  The  Chief  Executive  Officer
of IDA accordingly wrote to the Principal Secretary of  the  Madhya  Pradesh
Govt. on 27.5.2003 for grant of this permission, and  consequently  for  the
increase in the  license  fee.   The  State  Govt.  however  wrote  back  on
23.9.2003 declining the request,  and  asking  IDA  to  invite  the  tenders
afresh for the re-allotment of the  plot  (the  appellants  however  contend
that there is a  contrary  note  on  the  files  of  the  respondents  dated
29.9.2003 recommending  the  proposed  use).   That  apart,  ultimately  the
Madhya Pradesh Govt. issued the notification approving  the  change  in  the
land-use from ‘commercial’ to a ‘regional park’ on 19.11.2003.  It  is  this
letter  dated  23.9.2003  and  notification  dated  19.11.2003  which   were
challenged by the appellants by filing Writ  Petition  No.5698/2008  in  the
High Court of Madhya Pradesh.

9.          This letter dated 23.9.2003 reads as follows:-
                 “           M.P. Government
                 Housing and Environment Department
                             Ministry

            Letter No.H-3-107/3/32 Bhopal          Date 23.09.2003

            To,
                 The Chief Executive Officer
                 Indore Development Authority
                 Indore, M.P.

           Sub:  Regarding grant of permission  to  Mangal  Amusement  Park
                 Pvt. Ltd. for the construction of Amusement  Club,  Banquet
                 Hall on the land allotted under plan No.54  of  the  Indore
                 Development Authority.


           Ref:  Your letter No.6314 dated 23.05.03.


           Please take reference of the letter  referred  above,  by  which
           Authority had sought permission from Govt. for proposal on  land
           allotted by Authority on lease 1994.


              2. It has been established from the documents  made  available
                 by the Authority that proceedings by the Authority have not
                 been in accordance with the rules and there has  been  lack
                 of transparency.  Therefore, it is  not  possible  to  give
                 permission on this proposal of Authority.


              3. It is directed to Authority that it  utilize  the  land  in
                 question only after  issuing  fresh  notification  inviting
                 tenders.



                                                            Sd/-
                                                        Illegible
                                                      23.09.03
                                                   (C.C. Padiyar)
                                                    Under Secretary
                                                       M.P. Govt.
                              Housing and Environmental Department”


10.         The notification dated 19.11.2003 reads as follows:-

                 “HOUSING & ENVIRONMENT DEPARTMENT
                       Vallabh Bhawan, Bhopal.

                       Bhopal dated 19th November, 2003.

                 No.F-3-47-0000-32  –  The   State   Government   vide   its
                 Notification No.F-3-47-2000-32 dated 9th March, 2001 issued
                 under Section 23(A) (2) of the  Madhya  Pradesh  Urban  and
                 Rural Act,  1973  (Act  No.23/1973)  had  proposed  certain
                 modifications in public interests.  Thereafter  notices  to
                 the  above  effect  were  also  published  in   2   leading
                 newspapers on 15th  ad  16th  March,  2001.   Through  said
                 notice, Objections were invited from the aggrieved  persons
                 and ultimately  4  objections  were  received  jointly  and
                 individually.  Thereafter objectors of the said  objections
                 were heard on 3.8.2001 and 23.8.2001 and  their  objections
                 were considered  and  were  finally  rejected.   Thereafter
                 Department sought an opinion from the Municipal Corporation
                 of Indore on the proposed modification  and  the  Municipal
                 Corporation has granted its No Objection vide letter  dated
                 1st June, 2001.

      (2)   In the premises  aforesaid,  State  Government  hereby  confirms
           modification of the following lands of  Village  Bhamori  Dubey,
           Indore, as described in Schedule  ‘A’  hereunder,  according  to
           user prescribed in the Indore Development scheme, 1991.   It  is
           further informed that this modification will  be  an  integrated
           part  of the Approved Indore Development Scheme, 1991 as well as
           Draft Development Scheme, 2011.

                                SCHEDULE ‘A’

                 Land  use  modification  of  18.222  Hectares  and   17.931
                 Hectares situated in Village  Bhamori  Dubey  under  Indore
                 Development Scheme, 1991-



|Sr.   |Survey   |Area (In |Land user   |Change land|
|No.   |No.      |Hect).   |prescribed  |use        |
|      |         |         |in the      |           |
|      |         |         |Indore      |           |
|      |         |         |Development |           |
|      |         |         |Scheme      |           |
|(1)   |(2)      |(3)      |(4)         |(5)        |
|1.    |257 & 259|9.134    |Regional    |Commercial |
|      |         |         |Park        |           |
|2.    |258 part |0.113    |- “ -       |“          |
|      |         |         |            |           |
|      |260      |1.000    |- “ -       |“          |
|3.    |261      |1.295    |- “ -       |“          |
|4.    |262      |1.474    |- “ -       |“          |
|5.    |264      |0.522    |- “ -       |“          |
|6.    |265      |2.429    |- “ -       |“          |
|7.    |265 part |2.255    |- “ -       |“          |
|      |         |18.222   |            |           |
|8.    |91 part  |0.713    |Regional    |Commercial |
|      |         |         |Park        |           |
|9.    |92/1     |0.429    |- “ -       |“          |
|10.   |92/2     |0.425    |- “ -       |“          |
|11.   |93/1     |1.060    |- “ -       |“          |
|12.   |93/2     |1.064    |- “ -       |“          |
|13.   |94/1     |0.235    |- “ -       |“          |
|14.   |94/2     |0.235    |- “ -       |“          |
|15.   |95/1     |0.219    |- “ -       |“          |
|16.   |95/2     |0.223    |- “ -       |“          |
|17.   |96/1     |0.117    |- “ -       |“          |
|18.   |96/2     |0.117    |- “ -       |“          |
|19.   |152      |0.174    |- “ -       |“          |
|20.   |155 part |0.267    |- “ -       |“          |
|21.   |157      |0.186    |- “ -       |“          |
|22.   |159      |0.344    |- “ -       |“          |
|23.   |160      |0.360    |- “ -       |“          |
|24.   |161      |0.170    |- “ -       |“          |
|25.   |162      |8.259    |Commercial  |Regional   |
|      |         |         |            |Park       |
|26.   |163      |1.967    |- “ -       |“          |
|27.   |164 part |0.607    |- “ -       |“          |
|28.   |165 part |0.534    |- “ -       |“          |
|29.   |166 part |0.226    |- “ -       |“          |
|      |         |17.931   |            |           |

                                     In the name of and by Order of Governor

                                                            Shivanand Dubey,
                                                           Deputy Secretary”


11.         The appellants point out that thereafter also the stand  of  IDA
was different from that of the concerned  department  as  reflected  in  the
Notesheet of IDA dated 3.2.2005.  Yet,  ultimately  it  accepted  the  view-
point of the State Govt., and issued a show cause notice to  the  appellants
on 8.1.2007 alleging  various  breaches  of  the  terms  and  conditions  of
allotment.  In para 7 and 8 thereof, it was alleged as follows:-

                 “7.   You have not taken  action  to  establish  Children’s
           Amusement Park on the  land  allotted  violating  conditions  of
           license.  Half of the land  is  still  undeveloped,  vacant  and
           without any use given after 12 years of allotment.

                 8.    Application for the construction of  Amusement  Club,
           Banquet Hall on the land allotted, given by you establishes that
           you do  not  want  to  run  activities  relating  to  Children’s
           Amusement Park on the land allotted.”

            The appellants were, therefore, asked to show cause  as  to  why
the license of land allotted to them should not be cancelled.

12.         It is the further case of  the  appellants  that  although  this
show cause notice was issued on 8.1.2007, the Chairman  of  IDA  once  again
wrote to the Govt. on 29.11.2007 asking it to retain the  land-use  of  this
particular parcel of land as commercial.  The State Govt. however  proceeded
to bring the modification into force with effect from 1.1.2008.   It  is  at
this stage that the above writ petition No. 5698 of 2008 was filed with  the
following prayers:-

      (a)   to strike down Section 23-A of Madhya Pradesh Nagar  Tatha  Gram
Nivesh Adhiniyam 1973 (which prayer was however not pressed),

      (b)   to quash the notification dated 19.11.2003, and

      (c)   to quash Govt.’s letter dated 23.9.2003 (which prayer was  added
later on).

13.   Contentions of the rival parties

      The principle submission of the appellants was three-fold:-

      (a)   the document of allotment of the concerned  parcel  of  land  to
the appellants was a document of lease and not simply a  license,  and  that
the appellants were entitled to the renewal thereof,

      (b)   the appellants had  made  good  investment  onto  the  concerned
parcel of land, and they had their legitimate  expectations.   Consequently,
the respondents were bound by the doctrine of promissory estoppel  to  renew
the allotment,

      And

      (c)   the decision to change the land-use was a malafide one  for  the
benefit of another party which had its  parcel  of  land  in  the  vicinity,
where the land-use was changed from the previous  one  which  was  ‘regional
park’, to ‘commercial’.  The change of use of land of  the  parcel  allotted
to the appellants was effected to set off the resultant reduction  in  green
area, and to justify the change of land-use of the parcel of  land  allotted
to the other party.

14.         The petition was opposed by respondent nos. 1 and 2 on  the  one
hand, and  by  respondents  no.3  and  4  by  filing  their  replies.   They
contended principally as follows:-

      (a)   the concerned document of allotment was clearly  a  document  of
license, and not that of lease.  In any case, by that  time  the  period  of
license having expired after the lapse of 15 years, the appellants  did  not
have any case for renewal particularly when they had not put to use half  of
the land for the purpose for which it was allotted, and when  in  fact  they
wanted to use it for another purpose by putting up a banquet hall therein.

      (b)   Inasmuch as, the document of allotment was a license  which  was
valid only for 15 years, there was no question of the  appellants  having  a
legitimate expectation for a renewal beyond 15 years.  The  respondents  had
not promised any such renewal to the appellants to enable them to  avail  of
the doctrine of promissory estoppel.

      (c)   The modification in the  development  plan  was  effected  after
considering all relevant factors and not for obliging anybody.  No  material
in support of their allegation had been produced  by  the  appellants.   The
change was effected after following the due process of  law,  viz.  inviting
suggestions and objections, and hearing the concerned parties.   The  change
cannot be faulted on that count either.

15.         The petition was  heard  by  a  Division  Bench  of  the  Madhya
Pradesh High Court which dismissed the same by its judgment and order  dated
19.5.2011, after hearing the counsel for all the parties.  This judgment  is
under challenge in the present appeal.

16.   Consideration of the rival submissions

            The principle question to be considered is  as  to  whether  the
document of allotment of land dated 6.5.1994 was in any way  a  lease  or  a
license.  As far as a lease is concerned, Section 105  of  the  Transfer  of
Property Act, 1882, defines it as follows:-

                  “105. Lease defined.- A lease of immoveable property is  a
      transfer of a right to enjoy such property, made for a  certain  time,
      express or implied, or in perpetuity, in consideration of a price paid
      or promised, or of money, a share of crops, service or any other thing
      of value, to be rendered periodically or on specified occasions to the
      transferor by the transferee, who accepts the transfer on such terms.

                 Lessor, lessee, premium and rent defined. – The  transferor
      is called the lessor, the transferee is called the lessee,  the  price
      is called the premium, and the money, share, service or other thing to
      be so rendered is called the rent.”

As far as a license is concerned, the same is defined under  Section  52  of
the Indian Easements Act, 1882, as follows:-

                  “52. “License” defined.  -  Where  one  person  grants  to
      another, or to a definite number of other persons, a right to  do,  in
      or upon the immovable property of the grantor, something which  would,
      in the absence of such right, be unlawful, and  such  right  does  not
      amount to an easement or an interest in the  property,  the  right  is
      called a license.”

      From these two definitions it is clear that a  lease  is  not  a  mere
contract but envisages and transfers an interest  in  the  demised  property
creating a right in favour of the lessee in rem.  As against that a  license
only makes an action lawful which without it would  be  unlawful,  but  does
not transfer any interest in favour  of  the  licensee  in  respect  of  the
property.

17.         The issue concerning the distinction between lease  and  license
came up for consideration before this court in Associated  Hotels  of  India
vs. R.N. Kapoor reported in AIR 1959 SC 1262.  In para 27 of  his  judgment,
Subba Rao,J.  (as he then was) observed therein as follows with  respect  to
lease:-

                 27.   There is a marked distinction between a lease  and  a
    license. Section 105 of the Transfer of Property Act defines a lease of
    immovable property as a transfer of a right to enjoy such property made
    for a certain time in consideration for a price paid or promised. Under
    Section 108 of the said Act, the  lessee  is  entitled  to  be  put  in
    possession of the property. A lease  is  therefore  a  transfer  of  an
    interest in land. The interest  transferred  is  called  the  leasehold
    interest. The lessor parts with his right to enjoy the property  during
    the term of the lease, and it follows from it that the lessee gets that
    right to the exclusion of the lessor…..”




Thereafter, the learned Judge referred to the definition  of  license,  then
observed as follows:-
                 “Under the aforesaid section, if a document  gives  only  a
    right to use the property in a particular way or  under  certain  terms
    while it remains in possession and control of  the  owner  thereof,  it
    will be a license. The legal possession,  therefore,  continues  to  be
    with the owner of the property, but the licensee is permitted  to  make
    use of the premises for a particular purpose. But for  the  permission,
    his occupation would be unlawful. It does not create in his favour  any
    estate  or  interest  in  the  property.  There  is,  therefore,  clear
    distinction between the two concepts. The dividing line is clear though
    sometimes it becomes very thin or even blurred.”

18.         Subba Rao, J., thereafter referred to the judgments of Court  of
Appeal in Errington V. Errington, 1952-1 All ER 149, and Cobb V. Lane, 1952-
1 All ER 1199, and then observed as follows:-

                 “The following propositions may,  therefore,  be  taken  as
    well-established : (1)  To  ascertain  whether  a  document  creates  a
    license or lease, the substance of the document must  be  preferred  to
    the form; (2) the real test is the intention of the parties  -  whether
    they intended to create a lease or  a  license;  (3)  if  the  document
    creates an interest in the property, it is a lease;  but,  if  it  only
    permits another to make  use  of  the  property,  of  which  the  legal
    possession continues with the owner, it is a license; and (4) if  under
    the document a party gets exclusive possession of the  property,  prima
    facie, he is considered to  be  a  tenant;  but  circumstances  may  be
    established which negative the intention to create a lease.”

      These propositions have been quoted with approval  subsequently  by  a
bench of three Judges in Konchanda  Ramamurty  Subudhi  (dead)  V.  Gopinath
Naik and Ors. reported in AIR 1968 SC 919, and  in  Capt.  B.V.  D’Souza  V.
Antonio Fausto Fernandes reported in AIR 1989 SC 1816.



19. (i)          Having seen this legal position, we  may  now  examine  the
submissions of the rival parties.  It was submitted by  Shri  Ranjit  Kumar,
learned senior counsel that, it has to be noted that though the document  of
allotment states that the license is granted initially for a  period  of  15
years, clause 8 thereof adds that it may be renewed for a further period  of
15 years by enhancing the license fee maximum  by  40%,  and  thereafter  at
such a percentage as may be decided by the authority.   This  indicated  the
permission to the allottee to remain on the concerned parcel of land  for  a
period of 30 years and more, and should therefore be construed  as  creating
an interest in the  parcel  of  land.   Therefore,  in  his  submission  the
document of allotment created a lease, and renewal thereof was a  matter  of
formality, and the IDA was bound to renew the document. He referred  to  the
judgment of this Court in Sudhir Kumar & Ors. vs. Baldev  Krishna  Thapar  &
Ors. reported in 1969 (3) SCC 611 to submit that a  lessor  cannot  withhold
his consent for renewal unreasonably.

(ii)   Shri Vikas Singh, learned senior counsel appearing for  IDA  and  Ms.
Vibha Datta-Makhija, learned counsel for the State Govt.  submitted  on  the
other hand that the possession of the allottee was merely a permissive  one,
and that it was not exclusive to warrant an  inference  of  creation  of  an
interest.  In their view,  the  document  of  allotment  when  read  in  the
entirety makes it very clear that it was a license and not a lease.





20.         In the instant case, if we peruse  the  document  of  allotment,
the following facts are noticed:-

(i)           The first clause does  provide  that  the  land  is  given  on
license initially for a period of 15 years, and clause 8 does lay down  that
the license may be renewed for a further period of  15  years  by  enhancing
the license fee maximum by 40%, and thereafter at such a percentage  as  may
be decided by the Authority.  We must,  however,  as  well  note  the  other
provisions in the document of allotment and their effect.

(ii)  In the instant case, the document of allotment is called a  ‘license’,
and the allottee is called a ‘licensee’.  In the very first  clause,  it  is
stated that the concerned parcel of land is given on license, and  clause  4
refers to the amount payable by the licensee as the license fee which is  to
be paid annually before the first of June.

(iii) Clause 11 of  the  document  requires  the  licensee  to  provide  the
specified games and rides in the amusement park.  Not only that  but  clause
10 further requires that the rides, games etc. should  be  bought  from  the
suppliers manufacturing them in India indigenously.

(iv)  Clause 7 authorises IDA to regulate the mode of  collection  of  entry
fee, and clause 5 provides that the amount equal to 25%  of  the  entry  fee
will be charged by the IDA  in  addition  to  the  license  fee.   Clause  7
further provides that the Authority (i.e IDA) or the officer  authorised  by
the Authority will have the power to examine the accounts of  collection  of
entry fee, as and when deemed fit.

21.         It must also be noted that the  concerned  document  has  to  be
read as a whole, and when we see the  above  clauses  together,  it  becomes
clear that IDA retained complete control over the concerned parcel of  land.
 The manner in which the  facilities  in  the  amusement  park  were  to  be
enjoyed was completely controlled by the IDA.  The IDA decided  as  to  what
games and rides were to be provided.  It also laid down  as  to  from  which
suppliers  these  games  and  rides  were  to  be  purchased.   IDA  further
regulated the mode of collection of entry fee, and had the right to  examine
the accounts of collection thereof as and when  it  deemed  fit.   Over  and
above, Clause 14 of the document specifically provided that in the event  of
violation of any of these terms and conditions on the part of the  licensee,
the decision of the Chairman of IDA will be final, indicating the  right  of
IDA to terminate the license in the event of such a contingency.   Obviously
when all these clauses are seen together, it becomes clear  that  there  was
no exclusive possession handed over to the appellants.  Thus,  the  document
of allotment merely granted a permission to  use  the  concerned  parcel  of
land in a particular manner, and  without  creating  any  interest  therein.
Hence, if we apply the tests which have been laid down  by  this  court  way
back in the year 1959 (and followed subsequently) the document will have  to
read as granting a license, and not a lease.

22.         The appellants had challenged the legality of  the  letter/order
dated  23.9.2003  issued  by  the  State  Government  to  the   IDA.    That
letter/order while declining the proposal of IDA  to  permit  the  amusement
club and Banquet Hall  proposed  by  the  appellant,  directed  the  IDA  to
utilize the land in  question  after  issuing  fresh  notification  inviting
tenders.  It was submitted that the IDA was in fact, favourably inclined  to
consider  the  proposal  of  the  appellants,  and  the  said   letter/order
indicated mala fides on  the  part  of  the  State  Govt.   It  was  further
submitted that IDA was a body corporate under Section 39 of  the  M.P.  Act,
and though section 73 empowers the State Government to  give  directions  in
matters of policy, this power cannot be exercised to give the directions  of
the kind contained in the letter dated 23.9.2003.   In  this  connection  it
was contended that assuming that the letter may not be found to be  vitiated
by reason of malice on fact, but still it can be held to be invalid  if  the
same had been issued for unauthorized purpose as it would amount  to  malice
in law. Reliance was placed in this behalf on the proposition  in  paragraph
40 of the judgment of this Court in Punjab State Electricity Board Ltd.  Vs.
Zora singh and Ors. Reported in 2005 (6) SCC 776.

23.          In our view, the appellants have tried to make much  ado  about
the stand which  the  IDA  took  on  earlier  occasions  in  favour  of  the
appellants.  One has to  recognise  that  where  different  authorities  are
dealing with a particular  subject,  it  is  quite  possible  that  on  some
occasions,  they  may  take  a  stand  different  from  each  other,  though
ultimately it is the decision of the competent authority which matters,  and
it cannot be tainted with mala fides merely on that  count.   The  following
observations of this Court in para 35 of Jasbir Singh  Chhabra  &  Ors.  vs.
State of Punjab reported in  2010  (4)  SCC  192  are  instructive  in  this
behalf:-

            “35. It must always be remembered that in a  democratic  polity
    like ours, the functions of the Government are carried out by different
    individuals at different levels. The issues and  policy  matters  which
    are required to be decided by the Government are dealt with by  several
    functionaries some of whom may record notings on the files favouring  a
    particular person or group of persons. Someone may suggest a particular
    line of action, which may not  be  conducive  to  public  interest  and
    others may suggest adoption  of  a  different  mode  in  larger  public
    interest. However, the final decision is required to be  taken  by  the
    designated authority keeping in view the larger  public  interest.  The
    notings recorded in the files cannot be  made  basis  for  recording  a
    finding that the ultimate decision taken by the Government  is  tainted
    by malafides or is influenced by extraneous considerations……”

24.         The High Court has held in para  23  of  the  impugned  judgment
that in any case admittedly the license had come to  an  end  by  efflux  of
time in the month of the June 2010, and therefore the validity and  legality
of the letter/order dated 23.9.2003 had  become  academic,  and  it  was  no
longer necessary to examine that issue.  We cannot find fault with the  High
Court on that account, since quashing of this letter cannot in any way  lead
to the renewal of the  license  which  had  already  expired.  Besides,  the
respondents had valid reasons not to renew the license as indicated  in  the
show cause notice dated 8.1.2007.  The construction of Amusement Club  or  a
Banquet Hall could certainly not be a part of a Children’s  Amusement  Park.
The parcel of land was allotted for setting up of  a  children’s  park  with
games and rides as indicated in  the  document  of  license.   Additionally,
what was permitted were the  food  and  beverages  centers,  kiosks,  shops,
administrative building and toilets, which would be in furtherance  of  this
objective. The Banquet Hall and an amusement club which  would  be  used  by
adults would not fit in  the  purpose  of  Children’s  Amusement  Park.   As
stated in clause 8 of the show cause notice, it clearly indicated  that  the
appellants did not want to  run  the  activity  related  to  the  Children’s
amusement park on the land allotted.

25. (i)          It was submitted on behalf of the appellants that they  had
made good investment  in  the  concerned  parcel  of  land  with  legitimate
expectations,  and,  therefore,   the   respondents   were   estopped   from
discontinuing their allotment on the basis of  the  doctrine  of  promissory
estoppel.  This submission was disputed by Shri Vikas Singh, learned  senior
counsel appearing for IDA.  He ,firstly, pointed out that more than half  of
the land remained un-utilised even 12 years after  the  allotment,  and,  in
fact, the park was not functioning for quite sometime.  The games and  rides
which were placed on this parcel of land were in  the  nature  of  fixtures,
and not permanent additions as such, and could  be  removed  therefrom  when
the appellants were required to vacate.

(ii)  Having noted these submissions we are  of  the  view  that  since  the
document of allotment was a license and not one creating any  interest,  the
provision of renewal contained therein cannot  be  read  as  laying  down  a
mandatory requirement.  Besides, as stated above, clause 14 of the  document
of license clearly stated that in the event  of  violation  of  any  of  the
terms and conditions on the part  of  the  licensee,  the  decision  of  the
Chairman of IDA was final.  Para 7 of the show cause notice in  fact  stated
that the necessary action to establish the  Children’s  Amusement  Park  had
not been taken since half of the  land  had  remained  undeveloped,  and  it
amounted  to  violating  the  conditions  of  license.   The   doctrine   of
promissory estoppel can certainly not be permitted to be invoked on  such  a
background.

26.(i)           The appellants had made one more  prayer  namely  to  quash
and set aside the notification dated 19.11.2003.  Section 23-A of  the  M.P.
Act permits the modification of the provisions in the  development  plan  by
following the due procedure of law as laid down  therein.   In  the  instant
case, a notification had  been  issued  earlier  on  9.3.2001  inviting  the
objections to the proposed modification.  The  appellants  were  heard  with
respect  to  these  objections,  and  thereafter  the   notification   dated
19.11.2003 had been issued approving  the  proposed  modification.   It  was
contended on behalf of the appellants that the modification was a  motivated
one.  The appellants submitted that under  the  modification,  a  parcel  of
land in nearby vicinity which was earlier reserved for  a  green  area,  was
now being permitted for a commercial use,  whereas  the  user  of  the  land
which was marked for the Children’s Amusement Park, was being changed  to  a
regional park.  This was with a view to accommodate the constructions  which
had come up on the other parcel of land in the vicinity.

(ii)  In this connection we must note that the  appellants  had  not  joined
any of those parties for whose benefit this change had been allegedly  made.
 As held in Girias Investment  (P)  Ltd.  vs.  State  of  Karnataka  &  Ors.
reported in 2008 (7) SCC 53, in the absence of factual basis, the  court  is
precluded from going into the plea of malafides.  As far as the  land  meant
for the Children’s amusement park is concerned, the same was hardly  put  to
the full use.  In as much as this entire parcel of land  of  about  7  acres
was not utilized, and since it  was  an  open  parcel  of  land,  there  was
nothing wrong in the State Government deciding  to  retain  it  as  an  open
parcel of land, and to change the land-use  thereof  from  commercial  to  a
regional park.  The notification cannot be faulted on that count either.

27.         In the circumstances, we do not find any error in  the  impugned
judgment of the High Court. The  appeal  is  therefore  dismissed.   Parties
will bear their own costs.

                                                   …………..……………………..J.
                                                ( Surinder Singh Nijjar )




                                                        …………………………………..J.
                                                ( H.L. Gokhale  )

New Delhi
Dated: 28th August, 2012
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