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Sunday, July 3, 2016

Frustration of Contract under sec.56 of Indian Contract Act - entitled for return of deposit with interest =even though the High Court held that the project land that we are concerned with was “Residential” as contended by the DDA, yet the High Court held that in the event construction activity thereon is not permitted by the Delhi Pollution Control Committee (or the DPCC) the developer (Kenneth Builders) would be entitled to a refund of the entire amount deposited with the DDA pursuant to the acceptance of the developer’s bid in an auction, along with interest thereon.- “56. Agreement to do impossible act - An agreement to do an act impossible in itself is void.-Impossible means It ought to be interpreted as impracticable and useless from the point of view of the object and purpose that the parties had in view when they entered into the contract.- As Lord Atkinson said in Matthey v. Curling[5] “a person who expressly contracts absolutely to do a thing not naturally impossible is not excused for non-performance because of being prevented by the act of God or the King's enemies … or vis major”.= we are satisfied that certain circumstances had intervened, making it impracticable for Kenneth Builders to commence the construction activity on the project land. Since arriving at some clarity on the issue had taken a couple of years and that clarity was eventually and unambiguously provided by the report of the CEC, it could certainly be said that the contract between the DDA and Kenneth Builders was impossible of performance within the meaning of that word in Section 56 of the Contract Act. Therefore, we reject the contention of the DDA that the contract between the DDA and Kenneth Builders was not frustrated.- Kenneth Builders had prayed for interest at 18% per annum in the High Court but that was declined and only 6% per annum was awarded. Kenneth Builders is not in appeal before us on this issue. However, we make it clear that the calculation of interest on the amount deposited would be with effect from 11th September, 2006 when the entire amount of Rs. 450.01 crores was deposited by Kenneth Builders with the DDA. The appeal filed by the DDA is dismissed. The DDA should now refund the deposit made by Kenneth Builders with interest at 6% per annum calculated from 11th September, 2006 till realization

                                                  REPORTABLE
                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDCITION
                       CIVIL APPEAL NO. 5370  OF 2016
              (Arising out of S.L.P. (Civil) No. 35374 of 2010)

Delhi Development Authority                       …Appellant

                                   Versus

Kenneth Builders & Developers Ltd. & Ors.          ...Respondents

                                    WITH

                        CIVIL APPEAL NO.5371  OF 2016
              (Arising out of S.L.P. (Civil) No. 13146 of 2011)


                               J U D G M E N T

Madan B. Lokur, J.
1.    Delay condoned.  Leave granted in both petitions.
2.    The appellant (Delhi Development Authority or the DDA)  in  the  first
appeal is aggrieved by the judgment and order dated 30th July,  2010  passed
by a Division Bench of the High Court of  Delhi  in  W.P.(C)  No.  10647  of
2009.[1] The grievance of the DDA is that even though the  High  Court  held
that the project land that  we  are  concerned  with  was  “Residential”  as
contended  by  the  DDA,  yet  the  High  Court  held  that  in  the   event
construction activity thereon  is  not  permitted  by  the  Delhi  Pollution
Control Committee (or the DPCC) the developer (Kenneth  Builders)  would  be
entitled to a refund of the entire amount deposited with  the  DDA  pursuant
to the acceptance of the developer’s bid in an auction, along with  interest
thereon.
3.    In the connected appeal, the appellants (Government  of  the  National
Capital Territory of Delhi or the GNCTD and its Department of  Forests)  are
aggrieved by the same judgment and order to the  extent  that  it  has  been
held that the DDA is the final authority to determine land use, even  though
its determination pertains to the Ridge in the  National  Capital  Territory
of Delhi.
4.     Before referring to the facts of the case, which we have  taken  from
the appeal filed and argued by the DDA, we would like to mention that  there
has been protracted correspondence between the  DDA,  Kenneth  Builders  and
the Secretary (Environment) cum Chairman  of  the  Delhi  Pollution  Control
Committee of the GNCTD. However, we are of opinion that it is not  necessary
to detail the contents of every letter between them and we  propose  not  to
burden this judgment with avoidable details, as long as the  narrative  does
not suffer.
5.     The principal question that arises for our decision  is  whether  the
development agreement between the DDA and  the  developer  Kenneth  Builders
was frustrated within the meaning of Section 56 of the Indian Contract  Act,
1872 due to  some  intervening  circumstances  not  contemplated  by  either
party. Our answer to the question is in the affirmative.
The facts of the case
6.     The  DDA  proposed  a  public-private  partnership  project  for  the
development of an area of 14.3 hectares of prime land at Tehkhand  in  South
Delhi for the construction of  750  premium  residential  flats  in  a  self
contained community to be sold by private real estate  development  on  free
sale basis. In addition to the  premium  residential  flats,  the  developer
would have to  construct  3500  resettlement  houses  for  the  economically
weaker sections of society with each house having a super  area  of  26  sq.
metres. These  resettlement  houses  and  the  developed  common  facilities
relating thereto would be handed over to the DDA for allotment.
7.     According to the DDA  (and  there  is  no  dispute  about  this)  the
project land was notified on 1st August,  1990  for  “Recreation”  (District
Park) in the Master Plan for Delhi - 2001 (MPD-2001). According to  the  DDA
(and again there is no  dispute  in  this  regard)  two  notifications  were
issued by the Ministry of Urban Development of the Government  of  India  on
8th January, 2002 and 23rd February, 2006 converting the project  land  from
“Recreation” (District Park) to “Residential”.
8.     On 20th March, 2006 the DDA issued  an  advertisement  for  involving
the private sector in Delhi’s development and for  the  development  of  the
project land  for  the  construction  of  750  residential  flats  and  3500
resettlement houses.  Pursuant to the advertisement, an auction was held  by
the DDA in terms of the Delhi Development Authority (Disposal  of  Developed
Nazul Land) Rules, 1981 on an “as is where is basis” and as  per  the  terms
and conditions prescribed for the auction.
9.     The terms and conditions for the auction specifically mentioned  that
the bid would be for the amount of premium offered for the project  land  to
execute the project and that the project was being  offered  on  an  “as  is
where is basis”. It was stated that the presumption is  that  the  intending
purchaser has inspected the site  and  has  familiarized  himself  with  the
prevalent conditions in all  respects  including  status  of  infrastructure
facilities available etc. before giving its bid.   It  was  stated  that  on
acceptance of the bid, the highest bidder would be required to  deposit  25%
of the bid amount as earnest money and the balance 75%  of  the  bid  amount
was required to be deposited with 90 days of the issuance of the  allotment-
cum-demand letter. It was also stated that possession of  the  project  land
would be handed over on payment of the entire bid amount  and  on  execution
of the development agreement, except an area of approximately 4 hectares  on
which there is a JJ cluster. The terms  and  conditions  also  required  the
developer to comply with  all  the  statutory  requirements  and  rules  and
regulations of all public bodies including payment of fees and taxes etc.
10.    Kenneth Builders was the highest bidder in the auction held  on  26th
April, 2006 and its bid was accepted.  On  15th  June,  2006  a  demand-cum-
allotment letter was issued to it requiring payment of balance  75%  of  the
bid amount. It is not in dispute that Kenneth Builders deposited the  entire
bid amount of Rs. 450.01 crores with the DDA on 11th September, 2006.
11.    Pursuant  to  the  deposit  of  the  entire  bid  amount  by  Kenneth
Builders, a no objection certificate was issued by the DDA on 6th  November,
2006 for submission of building  plans  for  the  project  to  the  Planning
Department of the DDA. Thereafter,  on  4th  December,  2006  possession  of
11.70 hectares of the project land was handed over to Kenneth  Builders  but
an area of approximately 2.60 hectares covered by the JJ  cluster  was  left
out and possession thereof was not given.
12.    On 5th September, 2007 a Development  Agreement  was  signed  between
the DDA and Kenneth  Builders  whereby  it  was  agreed,  inter  alia,  that
Kenneth Builders would construct 3500 houses for the  resettlement  of  slum
dwellers and 750 free sale flats which Kenneth Builders  would  be  entitled
to dispose of. Kenneth Builders would  also  develop  roads  and  peripheral
services for the entire project.
13.    In terms of the development agreement it was  the  responsibility  of
Kenneth Builders  to  obtain  various  approvals  and  clearances  from  the
appropriate authorities including environmental agencies of  the  State  and
the Central Government. Clause 6 of the Development Agreement  is  important
in this regard and this reads as follows:

“6. Responsibility of Developer to get various approvals and clearances

6.1 The Developer shall be responsible for  approval  of  drawings  and  for
obtaining other “No Objection Certificate; from the appropriate  authorities
and Deptts not limited to MCD, Delhi Jal Board,  Electric  supplying  agency
concerned, Delhi Fire Services, DUAC,  the  environmental  agencies  of  the
State and Central Government.  Authority or its authorized officers who  are
duly authorized to give approval on behalf of the Authority. (sic)

6.2 The delay in submission of applications,  drawings,  construction  plans
and compliance of the  observation:  shall  be  the  responsibility  of  the
Developer, and any delay in grant of approvals by the  aforesaid  Government
bodies shall not relieve the Developer of any of its responsibilities  under
the Contract.”

14.    Kenneth Builders was also deemed to have inspected the site  and  its
surroundings and checked the information available in  connection  therewith
including  the  sub-surface  conditions,  the  hydrological   and   climatic
conditions etc.  It  was  also  deemed  to  have  satisfied  itself  of  the
correctness and sufficiency of all the  material  and  all  its  obligations
under the contract, including dealing with  concerned  authorities  such  as
environmental agencies of the State and Central Government.  Clause 11.1  of
the Development Agreement in this regard is  important  and  this  reads  as
follows:

“11.1 Sufficiency of Information
The Developer shall be deemed to have satisfied itself  of  the  correctness
and sufficiency of all the  material  and  all  its  obligations  under  the
Contract, including dealing with the concerned authorities  not  limited  to
MCD, Delhi Jal  Board,  Electric  supplying  agency  concerned,  Delhi  Fire
Services,  DUAC,  the  environmental  agencies  of  the  State  and  Central
Government, Authority or its authorized officers who are duly authorized  to
give approval on behalf of the Authority at its own  cost  and  expense,  as
well as all the contingencies and all matters and things necessary  for  the
proper execution and completion of the project  and  the  remedying  of  any
defects therein, before submitting the tender.   The  Developer  has  agreed
and understood that no request for change in the  terms  and  conditions  of
the Contract shall be entertained at any stage on any ground whatsoever.”

15.    The problems  for  Kenneth  Builders  began  when,  pursuant  to  the
Development Agreement, it attempted to establish  infrastructure  facilities
on the project land such as its site office, DDA  office,  sample  flat  for
the economically weaker sections etc. sometime in  February/March  2008.  It
was then that the Department of Forests of the GNCTD  raised  objections  to
carrying out such activities on the ground that the project  land  falls  in
the Ridge and hence all activities were required to be suspended.
16.     The  objection  of  the  Department  of  Forests  compelled  Kenneth
Builders to stop  all  building  activity  on  the  project  land  and  that
resulted in an exchange of letters for the next several months  between  the
DDA, the GNCTD and Kenneth Builders. To cut a  long  story  short,  the  DDA
insisted that the project land was “Residential” and that the project  could
be undertaken thereon. The GNCTD was equally clear  that  the  project  land
falls within the Ridge and no construction activity  could  be  carried  out
without the consent of the Ridge Management  Board  and  the  permission  of
this Court. On its part, the Ministry of Environment and Forest,  Government
of  India  (or  the  MoEF)  kept  aloof  from  the  controversy   and   gave
environmental clearance for the project on 15th July, 2008  subject  to  the
condition that a  “consent  to  establish”  shall  be  obtained  by  Kenneth
Builders  from  the  DPCC  under  the  Water  (Prevention  and  Control   of
Pollution) Act, 1974 (for short the Water Act) and the Air  (Prevention  and
Control of Pollution)  Act,  1981  (for  short  the  Air  Act)  and  a  copy
submitted to the said Ministry before the start of any construction work  at
the site. The relevant extract of the environmental clearance given  by  the
MoEF reads as follows:

“Subject: Construction of residential housing project at Tehkhand New  Delhi
by M/s Kenneth Builders & Developers Pvt.  Ltd.  Environmental  Clearance  –
Reg.

Dear Sirs,

This has reference  to  your  application  No.  nil,  dated  15.01.2008  and
subsequent  letters  dated   23.04.2008   and   23.05.2008   seeking   prior
Environmental Clearance for the above project under  the  EIA  Notification,
2006.  The proposal has been appraised as per prescribed  procedure  in  the
light of provisions under the EIA Notification, 2006 on  the  basis  of  the
mandatory documents enclosed with the application viz.,  the  Questionnaire,
EIA, EMP and the additional clarifications  furnished  in  response  to  the
observations of the Expert Appraisal Committee constituted by the  competent
authority in its meetings held on 13th 14th March 2008, 1st & 3rd  May  2008
and 26th May, 2008 and awarded “Silver” grading to the project.

2.  xxx xxx xxx

3.  The Expert Committee after due considerations of the relevant  documents
submitted by the project proponent and additional  clarifications  furnished
in response to its observation have accorded environmental clearance as  per
the provisions of Environmental Impact Assessment Notification  –  2006  and
its subsequent amendments, subject to strict compliance  of  the  terms  and
conditions as follows:

PART A – SPECIFIC CONDITIONS

Construction Phase.
“Consent for Establishment” shall be obtained from Delhi  Pollution  Control
Committee under Air and Water Act and a  copy  shall  be  submitted  to  the
Ministry before start of any construction work at the site.
to  (xxvi)    xxx xxx xxx

II. Operation Phase
xxx xxx xxx

PART B - GENERAL CONDITIONS:
     xxx xxx xxx

4. and 5. xxx xxx xxx

6.   The Ministry reserves the right to add  additional  safeguard  measures
subsequently, if found necessary and to take  action  included  revoking  of
the  environment  clearance  under  the  provisions  of  the   Environmental
(Protection) Act, 1986, to ensure effective implementation of the  suggested
safeguard measures in a time bound and satisfactory manner.

7.  All other statutory clearances such as  the  approvals  for  Storage  of
diesel from Chief Controller of Explosives, Fire Department, Civil  Aviation
Department.  Forest Conservation Act, 1980 and  Wildlife  (Protection)  Act,
1972 etc. shall be obtained, as applicable by project  proponents  from  the
respective competent authorities.

8.  These stipulations would be enforced among others under  the  provisions
of  Water  (Prevention  and  Control  of  Pollution)  Act,  1974,  the   Air
(Prevention  and  control  of   Pollution)   Act   1981,   the   Environment
(Protection) Act, 1986 the Public Liability (Insurance) Act,  1991  and  EIA
Notification, 2006.

9.  Environmental clearance  is  subject  to  final  order  of  the  Hon’ble
Supreme Court of India in the matter of Goa Foundation v. Union of India  in
Writ Petition (Civil) No.460 of 2004 as may be applicable to this project.

10. xxx xxx”

17.    In view of the above,  Kenneth  Builders  applied  to  the  DPCC  for
“consent to  establish”  on  4th  November,  2008.  In  response,  the  DPCC
required Kenneth Builders to submit a  “ridge  demarcation  report”  at  the
earliest. Despite its asking by Kenneth Builders, the DDA did not  give  any
such report to Kenneth Builders on the ground that  the  issue  had  already
been clarified to the GNCTD in  a  letter  dated  17th  October,  2008.  The
letter dated 17th October,  2008  is  a  little  ambiguous  inasmuch  as  it
mentions that the boundaries of the Ridge have  been  delineated,  but  they
have not been identified at the site. The letter dated  17th  October,  2008
reads as follows:

“Subject: Regarding Residential housing Project at Tehkhand, New Delhi by
M/s Kenneth Builders & Developers Pvt. Ltd.

Sir,

This has reference to letter No. DPCC/MCIII/3154: dated  6th  August,  2008,
enclosing the copy of the letter of Secretary  (Environment)  cum  Chairman,
Delhi Pollution Control Committee, Government of National Capital  Territory
of Delhi dated 13th June, 2008.  In the Master Plan  for  Delhi-2001,  Ridge
has been defined in an area of 7777 hectares which is  to  be  preserved  in
its pristine glory.  In the Preamble of the  said  Master  Plan  for  Delhi-
2001, one conceptual sketch indicating the ridge has been shown  as  one  of
the  eight  concepts  only,  whereas  the  land  use  Plan  is   the   legal
documents/plan showing the details which are to be referred for the  purpose
of establishing the area/land use,  in  this  case  for  the  ridge/regional
park.

Delhi Government through its notification dated  24.05.1994  has  delineated
the boundaries of the ridge but the same has  not  been  identified  on  the
site.  This notification is under Section 4 for the areas  to  be  earmarked
as reserved forests under the Delhi Forest Act.

The land pocket where DDA has proposed residential development, was  clearly
shown under District Part in-MPD-2001, and the land  use  of  the  same  has
already been changed from Recreational Use (District  Park)  to  residential
vide  Gazette   of   India   notification   Nos.A-13011/30/1995-DDIB   dated
08.01.2002 and 23.02.2006 (copies enclosed).  The  said  notifications  were
issued following the due process of law and  taking  relevant  factors  into
consideration.  No objection in respect of the land use of the Project  land
were raised by any departments  including  the  Forest  Department  at  that
stage.

The Ministry of Environment  &  Forest,  after  considering  and  taking  on
record the representation from both Delhi Pollution  Control  Committee  and
DDA (Letter No.F.3(60)MP/D.116 dated 30.6.08) with respect to  land  use  of
the Project land, has accorded the Environment Clearance to our  project  on
15th July, 2008, copy of the same is attached herewith.

All the facts, documents and detailed plans have been shared  and  discussed
in detail between the two departments, in meeting.  In the  light  of  facts
been  legally  converted  from   recreational   use   (District   Park)   to
residential.

In view of the facts, it is requested that the “Consent to  Establish”  from
Delhi Pollution Control Committee under Air & Water Act be  granted  to  the
applicant at the earliest.”

18.    Faced with this impasse and unable to obtain  the  ridge  demarcation
report and therefore the “consent  to  establish”  from  the  DPCC,  Kenneth
Builders approached the Delhi High Court by way of a writ  petition  on  1st
August, 2009 resulting in the impugned  judgment  and  order.  In  the  writ
petition, Kenneth Builders prayed, inter alia,  for  setting  aside  of  the
tender/auction notice dated 20th March, 2006 as also  the  allotment  letter
dated 15th June, 2006 and a declaration that the project  was  incapable  of
performance. It was further prayed that the  auction  had  become  void  and
that Kenneth Builders was entitled to a refund of the  amount  paid  to  the
DDA along with interest at 18% per annum till realization.
Decision of the High Court
19.     The  High  Court  has  elaborately  discussed  the  various  letters
exchanged between the concerned parties and has thereafter  very  succinctly
put the controversy in focus  in  paragraphs  26  and  27  of  the  impugned
judgment and order. These paragraphs read as follows:

“26. The foregoing demonstrates the controversy between  the  parties.   The
petitioner’s stand is that it had made the bid for the project and  had  aid
the entire amount of Rs.450.01 crores on the clear  understanding  that  the
project  site  was  residential.   This  understanding,  according  to   the
petitioner, was based on the representation made by the DDA as the  detailed
facts referred to above would reveal.  In fact, the DDA has  maintained  and
continues to maintain its stand that the project  site  is  not  within  the
ridge area and  the  land  use  of  the  same  has  been  clearly  shown  as
residential.  According to  the  DDA,  the  land  in  question  was  earlier
earmarked for recreational (District  Park)  purposes.   However,  that  was
subsequently  altered  by  the  two  notifications  dated   08.01.2002   and
26.02.2006 by carrying out modifications  in  the  Master  Plan  (MPD-2001).
The stand of the DDA is also this that the land use of any  particular  area
is to be determined under the Master Plan and the authority which does  such
determination is the DDA and not any other authority, such as the DPCC.  The
clear stand of the DDA is that the DPCC has no right or  business  to  raise
any objection with regard to the land use and  that  is  solely  within  the
domain and powers of the DDA.   The  stand  of  the  DDA  is,  however,  not
accepted either by the DPCC or the Department of Forests, Government of  NCT
of  Delhi.   In  fact,  both  the  DPCC  and  the  Department   of   Forests
(respondents 2 and 4 herein) along with  the  Government  of  NCT  of  Delhi
(respondent No.3) have taken a unified  stand  that  the  land  in  question
falls within the ridge and more so because the  Department  of  Forests  has
found the said land to be part  of  Khasra  Nos.  444  and  445  of  village
Tehkhand which, in the revenue  record,  has  been  shown  as  “gair  mumkin
pahar”.  Thus, according to the said respondents, no  construction  activity
can be carried out in the land in question inasmuch as,  according  to  them
it falls within the ridge area. Consequently, the DPCC  has  refrained  from
issuing the “consent to establish” under Water and Air  Acts,  which  was  a
requirement and a condition of  the  clearance  given  by  the  Ministry  of
Environment and Forests, Government of India.

27.  It is  in  this  backdrop  that  the  petitioner  felt  that  there  is
virtually no chance of the project going ahead  in  view  of  the  stalemate
between the DDA and the various governmental  departments.   It  is  on  the
basis of this situation that the petitioner has sought the setting aside  of
the tender/auction as also the allotment  letter  dated  15.06.2006  in  its
favour and has sought the  return  of  the  money  paid  by  it  along  with
interest thereon.”

20.    By the impugned judgment and order, the High Court held that  Kenneth
Builders was not entitled  to  have  the  tender/auction  in  which  it  had
participated and in which  it  was  a  highest  bidder  set  aside.  Kenneth
Builders was also not entitled to have the letter of allotment issued to  it
pursuant to the acceptance of its bid in the auction conducted  by  the  DDA
set aside or to the return of money paid by it to the DDA. However,  it  was
held that Kenneth Builders would be entitled to have the  DPCC  examine  its
application for the grant of “consent to establish” from the stand point  of
the Water Act and the Air  Act  within  two  months  for  carrying  out  the
project which was the subject matter of the  writ  petition.   It  was  also
held that in the event the DPCC does not give  its  “consent  to  establish”
and the project cannot  be  carried  out  then  Kenneth  Builders  would  be
entitled to a return of the entire amount (with interest at the rate  of  6%
till realization) paid by it to  the  DDA  since  the  project  would  stand
frustrated and would be incapable of performance.
21.    For arriving at the above conclusions, the High Court held that  once
the Master  Plan  for  Delhi  prepared  by  the  DDA  earmarks  land  for  a
particular use, then no other authority can challenge the same.  As  far  as
the project land was concerned, the DDA had  earmarked  it  for  residential
use and this could not be challenged. The High Court also  held  that  after
the MoEF had given the environmental clearance, the role  of  the  DPCC  was
limited to the grant of “consent to establish” under the  Air  Act  and  the
Water Act. It was not open to the GNCTD, the Department of  Forests  or  the
DPCC to question the land use of the project land as determined by  the  DDA
on the ground that it was within the Ridge.
22.    At this stage, it is necessary to mention that  during  the  pendency
of the writ petition in the High Court, it came out that  during  a  meeting
convened by the Lieutenant Governor on 23rd June, 2009 on some other  issue,
the case of Kenneth Builders came up, perhaps for  an  informal  discussion.
Nevertheless, it was decided in  that  meeting  that  the  question  of  the
status of the project land should be referred to the MoEF  (even  though  it
had already granted environmental clearance) and that the  decision  of  the
MoEF would be accepted as  final.  These  facts  were  put  to  the  learned
Additional Solicitor General appearing in the matter and he sought  time  to
take instructions. Eventually, the following response  dated  3rd  December,
2009 was sent by the MoEF to the learned Additional Solicitor General:

“Sub: Opinion of the Ministry of Environment and Forest in regard to WP  (C)
No. 0647/2009

Ref.: Secretary, Environment, NCT’s D.O.  No.  F.11  (105/PA/CF/Part/09/4582
dated 27.11.2009).

Sir,

This is with regard to Writ Petition (C) 10647/2009 of Kenneth Builders  and
Developers Ltd. v. UOI & Ors. in the High Court of Delhi.   An  opinion  was
sought from Ministry of Environment and Forests to the effect that the  land
in the subject matter of the Writ Petition  mentioned  under  subject  is  a
part of Ridge or not. The opinion of Ministry of Environment and Forests  in
this regard is as follows:

“Keeping in view the purely legalistic position taken by  DDA  and  exercise
undertaken for identification of ridge, based upon  one  or  more  criterion
decided by NCT of Delhi, as relevant  for  classification  of  any  land  as
“ridge” in Delhi, the said piece  of  land  measuring  14.3  ha  falling  in
Khasra No.444 and 445 reflected as  “Gai  Mumkin  Pahar”  in  revenue  land,
needs to be considered as ridge in  accordance  to  the  spirit  of  various
orders of Hon’ble Supreme Court in WP (C) 4677/1985, morphological  features
and revenue records.  The Hon’ble Apex Court is still looking  into  various
aspects of protection & conservation of  Delhi  ridge,  in  WP  (Civil)  No.
4677/1985 from time to time.  However, the Hon’ble High Court of  Delhi,  if
deemed appropriate, the opinion of Central Empowered Committee,  set  up  by
Hon’ble Supreme Court may be taken”.

It is requested to intimate the Hon’ble  Court  about  the  opinion  of  the
Ministry of Environment and Forests when  the  case  will  come  up  on  4th
December, 2009.”

It will be seen from the above that the MoEF had taken a virtual volte  face
and had opined that the project land needs to be considered  as  Ridge,  but
if deemed appropriate the opinion of the Central Empowered  Committee  might
be taken. This was apparently not brought to the notice of the  High  Court.

23.    Be that as it may, the DDA has challenged  the  order  of  the  Delhi
High Court which has effectively directed  the  DDA  to  refund  the  tender
amount to Kenneth Builders since “consent to establish”  and  continue  with
the project had not been granted by the DPCC.  The  GNCTD  as  well  as  the
Department of Forests also filed a Petition  for  Special  Leave  to  Appeal
being SLP (C) No. 13146 of 2011 challenging the decision of the  Delhi  High
Court to the effect that the DDA is the competent authority  to  decide  the
land use.
Subsequent events
24.    After  the  decision  of  the  Delhi  High  Court,  Kenneth  Builders
requested the DPCC on 3rd August, 2010 in terms of the order  of  the  Delhi
High Court, for “consent to establish”. By its letter of 28th October,  2010
the DPCC made it quite clear that since Kenneth Builders did  not  have  any
clearance to carry out any construction on the project land from  the  Ridge
Management Board or from this Court  or  from  the  Department  of  Forests,
“consent to establish” under the Air Act and Water Act could not  be  given.
It was also mentioned that the Department of Forests  would  be  challenging
the order of the Delhi High Court in  this  Court.  The  letter  dated  28th
October, 2010 reads as follows:

“Sub: - Refusal of Consent under Water (Prevention & Control of Pollution)
Act, 1974 and (Prevention & Control of Pollution) Act, 1981 as amended to
date.

Whereas, you M/s KENNETH BUILDERS &  DEVELOPERS  PVT.  LTD.,  MAA  ANANDMAYI
MARG, TEHKHAND, DELHI (hereinafter referred as addressee) have  applied  for
Consent to Estab. (Orange Category) on 30.05.08  vide  I.D.  No.25891  under
section 21 of Air (Prevention & Control of  Pollution)  Act,  1981  and  u/s
25/26 of the Water  (Prevention  &  Control  of  Pollution)  Act,  1974  for
activity of Residential Construction Project.

And whereas, a letter dt. 27.03.08 addressed  to  the  Commissioner  (L.M.),
DDA was received from Deputy Conservator of Forest, South to provide a  copy
of Environmental Clearance w.r.t. large scale earth work undertaken  by  you
(the addressee)

And whereas, a copy of letter dt. 04.04.08  addressed  to  the  Commissioner
(L.M.) DDA was received from the Deputy  Conservator  of  Forest,  South  to
stop all construction activity on the said land  until  the  permission  for
the same is accorded by the Ridge Management Board.

And whereas, as decided by the Consent Management Committee (Orange) in  its
meeting held 03.06.08, a letter was issued  to  the  Deputy  Conservator  of
Forest, South, on 13.06.08 regarding status of Forest Clearance  w.r.t.  the
said project.

And whereas, a D.O. letter issued by the Chairman, DPCC on 13.06.08  to  the
Vice Chairman, DDA regarding immediate cessation of  all  construction  work
on the project site till the clearance  from  the  same  obtained  from  the
Competent Authorities including the Ridge Management  Board  &  the  Hon’ble
Supreme Court.

And whereas, a letter  dt.  23.06.08  has  been  received  from  the  Deputy
Conservator of Forest Dept. informing that  the  clearance  from  the  Ridge
Management Board & the Hon’ble Supreme Court has not  been  communicated  by
DDA so far.

And whereas a letter was issued to the Deputy Conservator of  Forest,  South
on 19.02.09 to confirm whether any forest clearance  and  ridge  demarcation
report to the said project has been granted or not.

And whereas, a reply was received from the  Deputy  Conservator  of  Forest,
South on 17.03.09 informing that no forest clearance has  been  accorded  so
far.

And whereas, a letter was issued to the Deputy Conservator of Forest,  South
on 16.04.09 along with the site plans of the project to  inform  the  status
of the area as per the ridge demarcation report.

And whereas, the Hon’ble High Court vide its judgment dt. 30.07.10  directed
the DPCC to examine the application of the petitioner for grant of  “Consent
to Establish” from the standpoint of the Water & Air Acts alone  within  two
months from the date of judgment.

And whereas,  after  examination,  as  decided  by  the  Consent  Management
Committee (Orange) in its meeting held on 22.09.10, a letter was  issued  to
the Forest Deptt. on 01.10.10 to send the opinion on  the  judgment  at  the
earliest as the issue pertains the Forest Department.

And whereas,  the  case  was  again  taken  up  by  the  Consent  Management
Committee (Orange) in it meeting held on 1.10.10 & it was decided:

“Forest department is going for appeal, therefore, consent be refused.”

Now, therefore, as decided by the said Committee aforementioned  consent  to
establish application under Air &  Water  Acts  to  the  addressee  unit  is
hereby refused with immediate effect.

Please note that the activity of Residential  Construction  Project  without
having valid consent under the Air & Water Acts is a punishable offence  and
attracts penal action under the provisions of the said Act.”

25.     In  view  of  the  categorical  response,  broadly   speaking,   the
controversy remains whether the project land is a part of the Ridge  or  not
and whether the contract between the  DDA  and  Kenneth  Builders  has  been
frustrated  due  to  supervening  factors  or  not.  To  resolve  the  first
controversy,  this  Court  passed  an  order  on  6th  October,   2015   for
ascertaining whether the project land falls within the Ridge  or  not.  This
was in view of the uncertainty in the status of the project land as well  as
the view expressed by the MoEF  in  the  letter  dated  3rd  December,  2009
addressed to the learned Additional Solicitor General appearing in the  High
Court that the issue could be best resolved (if  deemed  appropriate)  by  a
reference  to  the  Central  Empowered  Committee  set  up  by  this  Court.
Accordingly, we referred this  issue  to  the  Central  Empowered  Committee
(CEC) set up in T.N.Godavarman v. Union of India[2].
26.    Pursuant to the order of 6th October,  2015  the  CEC  submitted  its
Report dated 18th November,  2015  in  which  it  was  concluded  that  non-
forestry use of land falling  in  the  Ridge  was  permitted  only  after  a
development project was cleared  or  recommended  by  the  Ridge  Management
Board and permitted by this Court. However, a decision was rendered  by  the
Delhi High Court in a case filed by Ashok Kumar Tanwar [W.P.  (C)  No.  3339
of 2011 decided on 30th November, 2011] to the  effect  that  a  development
project on land outside the notified Ridge  area  but  having  morphological
features conforming to the Ridge  would  also  require  clearance  from  the
Ridge Management Board and this Court. Therefore,  as  far  as  the  present
case is concerned though the project land falls outside the  Ridge  but  has
morphological features conforming  to  the  Ridge  bringing  it  within  the
extended Ridge, the project of the DDA involving  non-forestry  use  of  the
land could be permitted  only  after  obtaining  clearance  from  the  Ridge
Management Board and after obtaining the permission of this Court.  The  CEC
in its Report stated in this regard as follows:

“6. The non-forestry use of land falling in Delhi Ridge  for  implementation
of the various development projects  are  being  permitted  only  after  the
proposal is cleared/recommended by the Ridge Management Board and  permitted
by this Hon’ble Court.  Such permissions have been granted by  this  Hon’ble
Court subject to deposit of 5% of the estimated project cost with the  Ridge
Management Board Fund for conservation and development of  Delhi  Ridge  and
compensatory afforestation over equivalent  non-forest  land/Ridge  land  at
project cost.

7.  Earlier, the clearance from the Delhi Ridge  Management  Board  and  the
permission of this Hon’ble Court was being insisted upon only in respect  of
the notified Ridge areas.  One Shri Ashok Kumar Tanwar filed  Writ  Petition
(Civil) No.3339 of 2011 before the Hon’ble High Court of Delhi  against  the
construction of buildings and other infrastructure facilities being done  by
the Directorate General, Border Road Organisation  in  2.25  acres  of  land
belonging to Ministry of Defence at Naraina, Delhi Cantonment on the  ground
that the said land falls in the Central Ridge and wherein  pursuant  to  the
directions of this Hon’ble Court the non-forestry uses are prohibited.   The
Government of NCT of Delhi after considering the view  of  the  Delhi  Ridge
Management Board filed before the Hon’ble High Court of Delhi  an  affidavit
dated 30th November, 2011 wherein it was stated that the  land  in  question
is situated outside the notified ridge areas  but  is  having  morphological
features conforming to the Ridge.  The Hon’ble High Court of Delhi by  order
dated 30th November, 2011 disposed  of  the  said  Writ  Petition  with  the
directions that the Border Road Organisation  is  restrained  from  carrying
out any further construction works on the land  till  it  obtains  necessary
clearance from the Delhi Ridge Management Board or (and) this Hon’ble  Court
through the CEC. A copy of the said order  of  the  Hon’ble  High  Court  of
Delhi is enclosed at ANNEXURE-R-2 to this Report.  Since then,  non-forestry
use of any land having morphological features conforming to  the  Ridge  but
falling outside the notified ridge areas (commonly referred to as  “extended
ridge areas”) is also being permitted only after  obtaining  clearance  from
the Delhi Ridge Management Board and permission of this Hon’ble Court.

8.  The said project  of  the  Border  Road  Organisation  was  subsequently
cleared/recommended by the Delhi Ridge Management Board, recommended by  the
CEC and thereafter this Hon’ble Court by  order  dated  2nd  November,  2012
granted permission for implementation of the project on 2.25  acre  of  land
falling on the “extended ridge areas”.  This Hon’ble Court by another  order
dated 21.10.2013 has granted permission for implementation of a  project  by
Delhi Metro Rail Corporation  (DMRC)  involving  use  of  lands  falling  in
“extended ridge area”.  The copies of the abovesaid orders  of  the  Hon’ble
Court dated 2nd November. 2012  and  21st  October,  2013  are  enclosed  at
ANNEXURE-R-3 and ANNEXURE-R-4 respectively to this Report.

9.   In the present case the Delhi Forest  Department  has  found  that  the
project  area  falls  in  “extended  ridge  area”  i.e.  outside  the  areas
identified as Ridge area in the MPD 2001/MPD 2021 but  having  morphological
features conforming to the ridge and that a large extent  of  areas  in  and
around the project site are recorded as “Gair Mumkin Pahar” in  the  revenue
records. The stand taken by the Forest Department has been verified  by  the
CEC during the site visit.  Copies of the photographs of  the  project  site
taken during the  site  visit  of  the  CEC  are  collectively  enclosed  at
ANNEXURE-R-5 to this Report.  A copy of  the  sketch  map  prepared  by  the
Forest Department showing the details of Gair  Mumkin  Pahar  areas  in  and
around project site is enclosed at ANNEXURE–R-6 to this Report.  A  copy  of
the satellite imagery made available by the DDA showing the project area  in
question and the  adjoining  areas  is  enclosed  at  ANNEXURE-R-7  to  this
Report.

10. From the above it may be seen that in the present case  the  land  falls
in the “extended Ridge area” i.e. outside the Ridge areas identified in  MPD
2001/MPD  2021  having   morphological   features   conforming   to   Ridge.
Implementation  of  all  the  similarly  placed  cases  i.e.  the   projects
involving non-forestry use of the areas falling in  “extended  ridge  areas”
have  been  permitted  only  after  obtaining  clearance  from   the   Ridge
Management Board and permission of this  Hon’ble  Court.  In  two  similarly
placed projects of the Border Road Organisation and DMRC this Hon’ble  Court
by orders dated 2nd November, 2012 and 21st October, 2013  respectively  has
granted permission from the non-forestry use of the  lands  falling  in  the
“extended Ridge area”.

11. In the above background the CEC is of the considered view  that  in  the
present case the proposed construction of buildings can be  undertaken  only
after obtaining clearance from the Ridge Management Board and permission  of
this Hon’ble Court.”

Discussion
27.    The first submission of learned counsel for the DDA was that  a  writ
petition under Article 226 of the Constitution was not maintainable for  the
reliefs claimed by Kenneth Builders. The reliefs arise out of a  contractual
dispute and the High Court ought not to have entertained the writ  petition.
We are not inclined to consider this submission for the reason that no  such
objection was raised by the DDA  before  the  High  Court  or  even  in  the
petition filed in this Court.  The submission has been advanced  by  learned
counsel for the DDA for the first time during the  final  hearing  of  these
appeals.   It is too late in the day for learned counsel to  raise  such  an
objection and we are not inclined to entertain it.
28.    On merits, it was submitted that in view of the terms and  conditions
of the auction and the development agreement between  the  DDA  and  Kenneth
Builders, it was the duty and responsibility of the developer to obtain  all
necessary clearances including environmental clearance and consent from  the
DPCC for completing the project. It was pointed out that the MoEF had  given
environmental clearance for the project on 15th July, 2008  subject  to  the
developer obtaining “consent to establish” from the DPCC under the  Air  Act
and the Water Act.  It was therefore the obligation of Kenneth  Builders  to
approach the DPCC and obtain the necessary consent which it failed to do.
29.    What has been overlooked by learned counsel is that  the  fresh  view
of the MoEF is that the project  land  needs  to  be  considered  as  Ridge.
Consequently, no construction activity is permissible on the  project  land.
That apart,  Kenneth  Builders  did  apply  to  the  DPCC  for  “consent  to
establish” for starting construction  activity  on  the  project  land.  For
considering the request, the DPCC required a ridge demarcation report  which
was not given by the DDA to Kenneth Builders or to the DPCC. Therefore,  the
DPCC was not inclined to give its  consent  in  the  absence  of  the  ridge
demarcation report.  Even after judgment was delivered by  the  High  Court,
Kenneth Builders applied to the DPCC for “consent to establish”  but  to  no
effect in the absence of a ridge demarcation report and forest clearance.
30.    It does appear from the record  that  the  exact  boundaries  of  the
Ridge had not been identified by anybody and this is apparent from a  letter
dated 13th June, 2008 sent by the Secretary (Environment) of  the  GNCTD  to
the DDA wherein it was pointed out that there is  some  discrepancy  between
the areas notified by the Ministry of Urban Development  of  the  Government
of India in the notifications dated 8th January,  2002  and  23rd  February,
2006 and the boundaries of the Ridge.  It was further pointed out  that  the
process of identification had been initiated by the  Department  of  Forests
of the GNCTD but it appears that the demarcation was not  completed  by  the
time the writ petition was filed by Kenneth Builders. According to  the  DDA
the letter was based on an incorrect appreciation of facts,  but  that  does
not concern us. All that is relevant is that the  GNCTD  believed  that  the
construction could not go on in the project land since it  fell  within  the
boundaries of the Ridge.
31.    In this context, it must not be  forgotten  that  even  after  having
given environmental clearance to  Kenneth  Builders,  the  MoEF  had  second
thoughts regarding the status of the project land.  This  led  the  MoEF  to
send the letter dated 3rd December, 2009 referred to above. In other  words,
the status of the project land was  generally  ‘unclear’  at  least  to  the
GNCTD and the MoEF.
32.    Be that as it may, it appears to us that Kenneth  Builders  did  take
all necessary steps to commence the construction  activity  on  the  project
land but due to the impasse created by the governmental agencies,  it  could
not proceed in the development activity. We agree with learned  counsel  for
Kenneth Builders that under these circumstances, the provisions  of  Section
56 of the Indian Contract Act, 1872 (the Contract Act)  would  be  attracted
to the facts of the case.  Section 56 of the Contract Act reads as follows:
“56. Agreement to do impossible act - An agreement to do an  act  impossible
in itself is void.
Contract to do act afterwards becoming impossible or unlawful -  A  contract
to do an act which, after the contract is made, becomes impossible,  or,  by
reason of some  event  which  the  promisor  could  not  prevent,  unlawful,
becomes void when the act becomes impossible or unlawful.
Compensation for loss through non-performance of act known to be  impossible
or unlawful - Where one person has promised to do something which  he  knew,
or, with reasonable diligence, might have known, and which the promisee  did
not  know,  to  be  impossible  or  unlawful,  such   promisor   must   make
compensation to such promisee for any  loss  which  such  promisee  sustains
through the non-performance of the promise.”

33.    The interpretation of Section 56 of the  Contract  Act  came  up  for
consideration in Satyabrata Ghose v. Mugneeram Bangur & Co.[3]  It was  held
by this Court that the word “impossible” used in Section 56 of the  Contract
Act has not been used in the sense of physical or literal impossibility.  It
ought to be interpreted as impracticable and useless from the point of  view
of the object and purpose that the parties had in  view  when  they  entered
into the contract. This impracticability or uselessness could arise  due  to
some intervening or supervening  circumstance  which  the  parties  had  not
contemplated. However, if the intervening circumstance was  contemplated  by
the parties, then the contract would stand despite the  occurrence  of  such
circumstance. In such an  event,  “there  can  be  no  case  of  frustration
because the basis of the contract being to demand  performance  despite  the
happening of a  particular  event,  it  cannot  disappear  when  that  event
happens.” This is what this Court had to say:
“The first paragraph of the section lays down the law in the same way as  in
England. It speaks of something which is impossible  inherently  or  by  its
very nature, and no one can obviously be directed to perform  such  an  act.
The second paragraph enunciates the law relating to  discharge  of  contract
by reason of supervening impossibility or illegality of the  act  agreed  to
be done. The wording of this paragraph is  quite  general,  and  though  the
illustrations attached to it are not at  all  happy,  they  cannot  derogate
from the general words used in the enactment. This much is  clear  that  the
word “impossible” has not been  used  here  in  the  sense  of  physical  or
literal impossibility. The performance  of  an  act  may  not  be  literally
impossible but it may be impracticable and useless from the  point  of  view
of the object and purpose which the parties had in view; and if an  untoward
event or change of circumstances totally upsets  the  very  foundation  upon
which the parties rested their bargain, it can very well be  said  that  the
promissor finds it impossible to do the act which he promised to do.

Although various theories have been propounded by the Judges and jurists  in
England regarding the juridical basis of the doctrine  of  frustration,  yet
the  essential  idea  upon  which  the  doctrine  is  based   is   that   of
impossibility of performance of the  contract;  in  fact  impossibility  and
frustration are often  used  as  interchangeable  expressions.  The  changed
circumstances, it is said, make the performance of the  contract  impossible
and the parties are absolved from the further performance of it as they  did
not promise to perform an impossibility. The parties shall  be  excused,  as
Lord Loreburn says[4]
“If substantially the whole contract becomes impossible  of  performance  or
in  other  words  impracticable  by  some  cause  for  which   neither   was
responsible.”

xxx xxx xxx

It must be  pointed  out  here  that  if  the  parties  do  contemplate  the
possibility  of  an  intervening  circumstance  which   might   affect   the
performance of the contract,  but  expressly  stipulate  that  the  contract
would stand despite such circumstance, there can be no case  of  frustration
because the basis of the contract being to demand  performance  despite  the
happening of a  particular  event,  it  cannot  disappear  when  that  event
happens. As Lord Atkinson said  in  Matthey  v.  Curling[5]  “a  person  who
expressly contracts absolutely to do a thing  not  naturally  impossible  is
not excused for non-performance because of being prevented  by  the  act  of
God or the King's enemies … or vis major”. This being the legal position,  a
contention  in  the  extreme  form  that  the  doctrine  of  frustration  as
recognised in English law does  not  come  at  all  within  the  purview  of
Section 56 of the Indian Contract Act cannot be accepted.”

34.    In so far as the present case is concerned,  the  DDA  certainly  did
not contemplate a prohibition on construction activity on the  project  land
which would fall within the Ridge or had  morphological  similarity  to  the
Ridge.  It is this circumstance  that  frustrated  the  performance  of  the
contract in the sense of making it impracticable of performance.
35.    It is true that the Government of  India  had  notified  the  project
land as “Residential” and that the project land was shown  as  “Residential”
in the MPD-2001 and MPD-2021. But that  fact  alone  would  not  change  the
position at law.  The exact boundaries of the Ridge do not  appear  to  have
been demarcated and in the absence of demarcation,  it  could  not  be  said
with any degree of certainty by the DDA  that  merely  because  of  the  two
notifications issued by the Ministry of Urban Development the  project  land
could be used for residential purposes even if it  fell  within  the  Ridge.
This would be ignoring the position at  law  and  would  be  stretching  the
argument a little too far. The DDA was unaware  that  even  if  the  project
land did not fall within the Ridge  yet  any  development  activity  thereon
would require permission from the Ridge Management Board  as  well  as  from
this Court since there was morphological similarity between  the  Ridge  and
the project land. It  is  this  intervening  circumstance  which  eventually
frustrated the implementation of the contract.
36.    It is one thing for the DDA to now contend  before  us  that  Kenneth
Builders could have applied to the Ridge Management Board for permission  to
carry out development activity and also approached this Court for  necessary
permission but it is another thing to say that these requirements  were  not
within  the  contemplation  of  the  DDA  and  certainly  not   within   the
contemplation of Kenneth Builders.  For a statutory body  like  the  DDA  to
contend that in  the  face  of  the  legal  position  (with  which  the  DDA
obviously does not agree), Kenneth Builders  ought  to  have  persisted  and
perhaps initiated or invited litigation cannot be appreciated.
37.    When the DDA informed Kenneth Builders  that  the  project  land  was
available on an “as is where is basis” and that it  was  the  responsibility
of the developer to obtain all clearances, the conditions  related  only  to
physical issues pertaining to the project land and ancillary  or  peripheral
legal issues  pertaining  to  the  actual  construction  activity,  such  as
compliance with the building bye-laws,  environmental  clearances  etc.  The
terms and conditions  of  “as  is  where  is”  or  environmental  clearances
emphasized by learned counsel for  the  DDA  certainly  did  not  extend  to
commencement  of  construction  activity  prohibited  by  law  except  after
obtaining permission of the Ridge Management Board and this  Court.  On  the
contrary, it was the obligation of the DDA to ensure that the  initial  path
for  commencement  of  construction  was   clear,   the   rest   being   the
responsibility of the developer. The failure of the DDA to provide  a  clear
passage due to an intervening circumstance beyond its contemplation went  to
the foundation of implementation of the contract with Kenneth  Builders  and
that is what frustrated its implementation.
38.    Reliance by learned counsel for the DDA  on  the  “as  is  where  is”
concept as well as clauses 6 and 11 of the  Development  Agreement  in  this
context is  misplaced.  As  mentioned  above,  this  primarily  pertains  to
physical issues at site. This is clear from the following  passage  referred
to by learned counsel from Punjab Urban Planning & Development Authority  v.
Raghu Nath Gupta[6]:
“Evidently, the commercial plots were allotted  on  “as-is-where-is”  basis.
The allottees would have ascertained the facilities available  at  the  time
of auction and after having accepted the commercial plots  on  “as-is-where-
is” basis, they cannot be heard to contend that PUDA had  not  provided  the
basic amenities like parking, lights, roads, water, sewerage,  etc.  If  the
allottees were not interested in taking  the  commercial  plots  on  “as-is-
where-is” basis, they should not  have  accepted  the  allotment  and  after
having accepted the allotment on “as-is-where-is” basis, they  are  estopped
from contending that  the  basic  amenities  like  parking,  lights,  roads,
water, sewerage, etc.  were  not  provided  by  PUDA  when  the  plots  were
allotted. Over and above, the facts would clearly indicate  that  there  was
not much delay on the part of PUDA to provide those facilities as  well.  As
noted, the electrical works and health works were  completed  by  24-12-2002
and 22-11-2002 respectively and all the  facilities  like  parking,  lights,
roads, water, sewerage, etc. were also provided.”

39.    On a conspectus of the facts and the law placed  before  us,  we  are
satisfied   that   certain   circumstances   had   intervened,   making   it
impracticable for Kenneth Builders to commence the construction activity  on
the project land. Since arriving at some clarity on the issue  had  taken  a
couple of years and that clarity was eventually and  unambiguously  provided
by the report of the CEC, it could  certainly  be  said  that  the  contract
between the DDA and Kenneth Builders was impossible  of  performance  within
the meaning of that word in Section 56 of the Contract  Act.  Therefore,  we
reject the contention of the DDA that  the  contract  between  the  DDA  and
Kenneth Builders was not frustrated.
40.    Learned counsel for Kenneth Builders urged that the amount  deposited
with the DDA ought to be returned with interest at 12% per annum and not  6%
per annum as directed by the High Court. We are not inclined  to  accede  to
this request. Kenneth Builders had prayed for interest at 18% per  annum  in
the High Court but that was declined and only  6%  per  annum  was  awarded.
Kenneth Builders is not in appeal before us on this issue. However, we  make
it clear that the calculation of interest on the amount deposited  would  be
with effect from 11th September, 2006 when the entire amount of  Rs.  450.01
crores was deposited by Kenneth Builders with the DDA.
41.    The GNCTD and the DPCC raised an issue before us  that  the  DDA  was
not  the  final  authority  in  the  matter  of  determining  the  land  use
particularly when it related to the Ridge. In the view that we  have  taken,
it is not necessary to go into this question.
Conclusion
42.    The appeal filed by the DDA is dismissed. The DDA should  now  refund
the deposit  made  by  Kenneth  Builders  with  interest  at  6%  per  annum
calculated from 11th September, 2006 till realization. The  question  raised
in the connected appeal filed by the GNCTD and the Department of Forests  of
the GNCTD is left open for consideration in an appropriate case.
43.    There will be no order as to costs.

                                 ………………………………J
                                 ( Madan B. Lokur )


                                 ……………………………….J
New Delhi;                              ( N.V. Ramana )
June 29, 2016
-----------------------
[1]  Kenneth Builders and Developers Ltd. v.  Union  of  India  and  others,
MANU/DE/1815/2010
[2]   (2013) 8 SCC 198
[3]  (1954) SCR 310
[4]  Tamplin Steam Ship Co. Ltd. v. Anglo-Mexican Petroleum Products Co.
Ltd., (1916) 2 AC 397, 403
[5]  (1922) 2 AC 180 at 234
[6]  (2012) 8 SCC 197

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