Whether the compromise decree dated 16.08.1976 is fraud and collusive and was intended/designed to overcome the provisions of the Urban Land Ceiling Act in so far the suit property is concerned. = The basis of the suit (O.S. No.397/1976) filed by the defendant Nos.1 & 2 is the division of property made in the year 1962 and the will dated 18.05.1976. Though some amount of haste may be disclosed by the facts surrounding the passing of the compromise decree dated 16.08.1976, as already noted, the said decree had been acknowledged by the father in Exhibit D-1 i.e. sale deed by which a part of the Schedule ‘C’ property was sold by him. The father of the parties died in the year 1991 and for a period of 15 years after the compromise decree and the execution of the sale deed he had not raised any question with regard to the authenticity or genuineness of what is stated in the will and the compromise decree. In these circumstances, the compromise decree dated 16.08.1976 must pass the test of acceptability. there were four buildings standing on the land in question which fact alone would throw considerable doubt with regard to the applicability of the Urban Land Ceiling Act to the suit land.=2014- OCt. Part - CIVIL APPEAL NO. 6197 OF 2010 LALITHA THERESA SEQUERIA (SINCE DIED) BY L.RS. ... APPELLANT (S) VERSUS DOLFY A PIAS @ ADOLPHYS JOSEPH PAIS & ANR. ... RESPONDENT (S)

                               NON-REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION
                       CIVIL APPEAL  NO. 6197 OF 2010


LALITHA THERESA SEQUERIA
(SINCE DIED) BY L.RS.                        ...   APPELLANT (S)

                                   VERSUS

DOLFY A PIAS @ ADOLPHYS
JOSEPH PAIS & ANR.                      ...  RESPONDENT (S)


                               J U D G M E N T

RANJAN GOGOI, J.

1.     The  substituted  appellants  (hereinafter   referred   to   as   the
plaintiffs) are the legal heirs of the plaintiff who  had  died  during  the
pendency of the present appeal. The respondents 1 and 2  (Defendants  1  and
2) are the brothers of the deceased plaintiff whereas respondent  Nos.  3(i)
and (ii) are the legal heirs of the  original  defendant  No.3  who  is  the
elder sister of the parties.
2.    The plaintiff had filed the suit (OS No.99 of 1995) out of  which  the
present appeal has arisen  seeking  a  declaration  that  the  decree  dated
16.8.1976 passed in OS No.397 of 1976 by the learned Munsiff, Mangalore  was
obtained by the defendants 1 and 2 (plaintiffs in that suit)  by  fraud  and
collusion designed to defeat the provisions of the Urban Land  Ceiling  Act,
1976. It was, therefore, prayed that the said decree  be  declared  as  null
and void. The suit was dismissed by the learned trial court. Aggrieved,  the
plaintiff filed an appeal before the learned District Judge,  Mangalore  who
allowed the same and decreed the suit of  the  plaintiff.  A  second  appeal
before the High Court of Karnataka was instituted  by  defendants  1  and  2
which was allowed by  the  impugned  order  dated  30.6.2005  reversing  the
decree passed in favour of the plaintiff  by  the  learned  First  Appellate
Court. It is against the aforesaid judgment and decree dated 30.6.2005  that
the present appeal had been filed by  the  plaintiff  who  died  during  the
pendency of the appeal and has been substituted by her legal heirs.

3.    The facts essential for  an  effective  adjudication  of  the  present
appeal may be briefly noted at this stage.

      In the plaint filed in OS No.99 of 1995 the plaintiff had stated  that
the father of the plaintiff and  defendants,  one  Anthony  Pais,  inherited
land measuring 96 cents and 47  cents  covered  by  Survey  No.124  and  127
respectively situated in     90-A Boloor Village,  Mangalore.  According  to
the plaintiff, O.S.No.397 of 1976 was instituted by the defendants 1  and  2
claiming that in the year 1962 an oral partition was  effected  between  her
father and defendants 1 and 2 dividing the aforesaid  property  in  more  or
less  equal  proportions  i.e.  42,  42  and  47  cents  respectively.   The
defendants  as  plaintiffs  in  O.S.No.397  of  1976  had  averred  that  on
18.5.1976 their father had  executed  a  Will  wherein  the  oral  partition
effected in 1962 was reiterated. However, as their father  had  subsequently
denied the oral partition of  the  property  made  in  the  year  1962,  the
aforesaid OS No.397 of 1976 was filed by the defendants 1 and 2 seeking  the
relief of declaration  of  their  ownership  etc.  OS  No.397  of  1976  was
compromised and a decree was passed on 16.8.1976  to  the  effect  that  the
defendants 1 and 2  and  their  father  were  the  absolute  owners  of  the
property divided/partitioned in the year 1962 described  as  Schedule  A,  B
and C properties respectively consisting of 42, 42  and  47  cents  of  land
respectively.  According  to  the  plaintiff,  she  and  her  elder   sister
defendant No.3  were  not  made  parties  to  the  suit  and  the  same  was
instituted by the defendant Nos. 1 and 2 with an  oblique  purpose  i.e.  to
defeat the  provisions  of  the  original  Urban  Land  Ceiling  Act,  1976.
According to the plaintiff, no oral partition was made in the year  1962  as
claimed and the Will dated 18.5.1976 had not been probated or registered  so
as to have any legal effect. It  was  claimed  that  the  concept  of  joint
family property is alien  to  the  parties  who  are  Christians  by  faith.
Therefore, the properties belonging to the father  of  the  plaintiff  could
not have been divided/partitioned without giving  the  plaintiff  her  share
therein.

4.    In the written statement filed by the  defendants  1  and  2,  it  was
contended that after the partition was effected  in  the  year  1962,  their
father had not disowned the same and in fact by  the  Will  dated  18.5.1976
had re-affirmed the said oral partition. It was further stated  that  though
there was a dispute that led to the filing of the OS No. 397  of  1976,  the
same was amicably resolved, as evident  from  the  compromise  decree  dated
16.8.1976. According to the defendants, their father had, all  along,  acted
in terms of the compromise decree passed in OS No.397 of 1976. In  fact,  he
had sold a part of the Schedule ‘C’ property that had devolved on him  under
the compromise decree and in the sale deed it was again recited that he  was
the absolute owner of the property, conveyed by the said  sale  deed,  under
the compromise decree dated 16.8.1976.

5.    The learned trial court dismissed the suit by its judgment and  decree
dated 22.7.1997 holding that the property  having  devolved  on  the  father
from his mother it  was  open  for  him  to  divide  the  same  amongst  his
children, as he desired. As the plaintiff had no pre-existing right  to  the
said property, she could not have questioned the division of the  same  made
in the year 1962. The learned trial court further held that the  Will  dated
18.5.1976 specifically refers to the division of the family property in  the
year 1962 and though the Will itself is  un-probated,  its  execution  stood
proved on the basis of the evidence of the attesting  witnesses.  Therefore,
the Will can be looked into for collateral purpose. The learned trial  court
also came to the conclusion  that  the  evidence  of  PW1,  husband  of  the
plaintiff, clearly demonstrated that there were four buildings on  the  suit
land prior to the year 1968 and, therefore,  the  provisions  of  the  Urban
Land Ceiling Act  were  not  applicable  to  the  suit  property.  In  these
circumstances, the learned trial court  came  to  the  conclusion  that  the
validity of the compromise decree cannot be doubted on  the  grounds  urged.
The learned  trial  court  also  took  note  of  the  fact  that  after  the
compromise decree was passed, its authenticity and genuineness had not  been
questioned by the father of the parties and the  facts  subsequent  thereto,
i.e. execution of the sale deed (Ext.D-1) by the father  and  the  testimony
of DW-1 would go to show that the compromise decree was  given  due  effect.
The learned trial court further held that  the  compromise  decree  was  not
required to be registered in view of the  fact  that  the  decree  was  only
declaratory of the shares of the parties made as far back  as  in  the  year
1962.

6.    The First Appellate Court  overturned  the  findings  of  the  learned
Trial Court, primarily, on the ground that the  partition  effected  in  the
year 1962 was without any legal effect as  the  concept  of  coparceners  or
joint family property was exclusive  to  Hindu  Law  and  was  not  existent
amongst Christians. The execution of the Will dated  18.5.1976;  the  filing
of the suit by  the  defendants  (OS  No.397/76)  and  the  passing  of  the
compromise decree dated 18.07.1976, in view of the close proximity  of  time
to each other, were held to be relevant  facts  leaning  in  favour  of  the
version put forward by the plaintiff and casting  a  serious  doubt  on  the
bona fides of the defendants in filing OS No.397/76, so as  to  warrant  the
conclusion that the decree in the said suit was  intended  to  overcome  the
effect of the Urban Land Ceiling Act on the suit property.

7.    In the second appeal, the High Court  following  the  two  substantial
questions of law for its determination –
      “1. Whether the lower appellate court is right  in  holding  that  the
compromise arrived at was  liable  to  set  aside  without  going  into  the
question that plaintiff had locus stand to question the compromise?
      2. Whether the Urban Land Ceiling Act is applicable to this case?”


 8.    Both the substantial questions of law framed by the  High  Court  are
interconnected inasmuch as the answer to either revolves  around  the  legal
validity of the  compromise  decree  dated  16.08.1976.   In  answering  the
aforesaid question the existence or otherwise of the oral partition  of  the
year 1962; the will dated  18.05.1976;  the  circumstances  surrounding  the
compromise leading to the decree dated 16.08.1976 in O.S. No.397 of 1976  as
also the facts subsequent thereto, namely, the  sale  of  the  Schedule  ‘C’
property by the father and acknowledgment of the compromise  decree  in  the
sale deed (Exbt.1), would all be relevant.  We find no basis  to  hold  that
what was claimed by the defendants to have occurred in the year  1962  is  a
partition of the joint family property as  understood  in  Hindu  Law.   The
property was inherited by the father of the plaintiff from  his  mother  and
the parties being Christians, the father must be understood to  be  absolute
owner of such property.  In that  capacity  he  was  certainly  entitled  to
divide or distribute the property as he considered fit.  What  had  actually
happened in the year 1962 is, therefore, an oral division  of  the  property
at the instance of the absolute owner thereof i.e. the father in three  more
or less equal shares.  So far as Schedule ‘C’ property  which  fell  to  the
share of the father, a part of it was sold by Exhibit D-1 and the  remaining
devolved on 2 daughters including the plaintiff.  The aforesaid  arrangement
was acknowledged in the will dated  18.05.1976  though  the  same  has  been
referred to, and one must understand such reference to be loosely  made,  as
a partition of the property.  The execution of  the  will  dated  18.05.1976
has been proved by one of the attesting witnesses who had been  examined  in
the trial.  The above understanding of the facts would dispel the  arguments
advanced on behalf of the plaintiff-appellant that  the  partition  effected
in 1962 has been wrongly accepted by the High Court though  no  question  of
partition of joint family properties could arise in the  present  case,  the
parties being Christians by faith.

9.    The basis of the suit (O.S. No.397/1976) filed by the defendant  Nos.1
& 2 is the division of property made in the year 1962  and  the  will  dated
18.05.1976.  Though some amount of haste  may  be  disclosed  by  the  facts
surrounding the passing  of  the  compromise  decree  dated  16.08.1976,  as
already noted, the said decree  had  been  acknowledged  by  the  father  in
Exhibit D-1 i.e. sale deed by which a part of the Schedule ‘C’ property  was
sold by him.  The father of the parties died in the  year  1991  and  for  a
period of 15 years after the compromise decree  and  the  execution  of  the
sale deed he had not raised any question with regard to the authenticity  or
genuineness of what is stated in the will and  the  compromise  decree.   In
these circumstances, the compromise decree dated 16.08.1976  must  pass  the
test of acceptability.  The plaintiff contends that  the  compromise  decree
dated 16.08.1976  is  fraud  and  collusive  and  was  intended/designed  to
overcome the provisions of the Urban Land Ceiling Act in  so  far  the  suit
property is concerned.  Though an elaborate discussion on the said  question
has been made by the High Court,  the  issue  has  to  be  answered  against
plaintiff on the basis of  the  evidence  of  PW-1,  her  husband,  who  had
deposed that, at the relevant point  of  time,  there  were  four  buildings
standing on the land in question which fact alone would  throw  considerable
doubt with regard to the applicability of the Urban Land Ceiling Act to  the
suit land.  The plaintiff not having examined herself and having  based  her
entire case on the testimony of PW-1, in the light of the evidence  tendered
by the said witness, it would be reasonable and justified to hold  that  the
said evidence of PW-1 has itself demolished the case  of  the  plaintiff  in
its entirety.

10.   Accordingly, we find  no  ground  or  reason  to  interfere  with  the
judgment and order dated 30.6.2005 passed by the High Court which  has  been
challenged in the present appeal. We,  therefore,  dismiss  the  appeal  and
affirm the aforesaid order passed by the High Court of Karnataka  in  Second
Appeal No.49 of 2003.

                                                               ……………………………J.
                                           [RANJAN GOGOI]



                                                           ..………………..………..J.
                                           [R.K.AGRAWAL]
New Delhi;
October 09, 2014.
-----------------------
11

Whether the claim of the respondent-writ petitioner, a housing society, to Transferrable Development Rights (TDR) under the relevant Development Control Regulations (DCR) i.e. N-2.4 framed under the Maharashtra Regional and Town Planning Act, 1966 (for short “the MRTP Act”)., rejected is correct = The rejection of the claim of the respondent Society to TDR under the MRTP Act read with DCR N-2.4.17 is seriously flawed. =2014- Oct.Part -CIVIL APPEAL NO. 3008-3009 OF 2010 PUNE MUNICIPAL CORPORATION & ANR.... APPELLANT (S) VERSUS KAUSARBAG COOP. HOUSING SOCIETY... RESPONDENT (S) LTD. & ANR.

                                 REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION
                     CIVIL APPEAL  NO. 3008-3009 OF 2010


PUNE MUNICIPAL CORPORATION & ANR....    APPELLANT (S)

                                   VERSUS

KAUSARBAG COOP. HOUSING SOCIETY...      RESPONDENT (S)
LTD. & ANR.


                                    WITH

                        CIVIL APPEAL NO. 4580 OF 2010

                               J U D G M E N T

RANJAN GOGOI, J.


The controversy in the present appeals  arises  out  of  the  claim  of  the
respondent-writ petitioner, a housing society, to Transferrable  Development
Rights (TDR) under the relevant Development Control Regulations  (DCR)  i.e.
N-2.4 framed under the Maharashtra Regional  and  Town  Planning  Act,  1966
(for short “the MRTP Act”).  The said claim has been resisted  and  rejected
by the Pune Municipal Corporation and the  State  of  Maharashtra,  the  two
appellants in the appeals under consideration, on the ground that  the  land
in question was not reserved for a public purpose in  the  development  plan
prepared under the MRTP Act and being shown as an existing  garden  therein,
the claim to TDR has no legal basis.   There are additional grounds for  the
rejection, details whereof will be, noticed in the course of  the  narration
to be made hereinafter.  The land in question measured about 3.5  acres  and
was covered by Survey No.12 (Part) located at  Kohdhava  Khurd,  Pune.   The
view of the High Court being in favour of the respondent  (writ  petitioner)
society, the Pune Municipal Corporation and the State  of  Maharashtra  have
filed the two appeals in question.

The core fact that  emerges  from  the  multitude  of  collaterals  and  the
exhaustive pleadings of the parties is that the land in question  was  shown
by the respondent Society itself in the lay out plan submitted by it to  the
Pune Municipal Corporation, as reserved for garden. Acquisition of the  said
land was initiated in the year 1982 (28.01.1982)  under  the  provisions  of
the Land Acquisition Act, 1894 and the same was completed in the  year  1987
whereafter possession of the land was taken  over  on  19.02.1987.   In  the
draft development plan dated 15.09.1982  that  was  prepared  and  published
under the provisions of the MRTP Act, which was  subsequently  approved  and
sanctioned on 05.01.1987, the land was shown  as  an  existing  garden.  The
close proximity of time between the two parallel process is too  significant
to be overlooked. While according  to  the  respondent-writ  petitioner  the
stage and the manner of the inclusion of the land in  the  development  plan
is of no consequence to the issue  arising  i.e.  entitlement  to  TDR,  the
State contends that the land  was  acquired  under  a  non-development  plan
proposal which would not attract the provisions of the MRTP Act.

The High Court took the view that it cannot be understood as  to  how  there
can be a difference between land “which  was  part  of  a  development  plan
reserved by the Government or a part of the development  plan  submitted  by
the petitioner in which the land in question was shown as a garden”.  Laying
emphasis on the relevant  DCR  i.e.                 N-2.4.17(ii),  the  High
Court took the view that no such distinction is disclosed therein and  going
by the language of the DCR the respondent Society was  entitled  to  TDR  as
compensation for the land was not  received  by  it.  The  High  Court  also
noticed the various communications brought on record by the  respondent-writ
petitioner to show  that,  at  different  stages,  the  authorities  of  the
Municipal Corporation as well as those  of  the  State  of  Maharashtra  had
unequivocally indicated the entitlement of  the  respondent-writ  petitioner
to Transferable Development Rights.  The  High  Court  also  held  that  the
directions contained in Government Order dated 03.02.2007 to be contrary  to
DCR N-.2.4.17 which is an instance of exercise  of  statutory  powers  under
the MRTP Act.  The said G.O. dated 03.02.2007 had excluded  the  entitlement
to  Transferable  Development  Rights  once  an  award  had  been  made  and
possession of the land had been delivered as in the present case.

We have heard Shri V.A. Mohta, learned senior counsel and Shri Aniruddha  P.
Mayee, learned counsel appearing for the appellants  and  Shri  Vinod  Bobde
and Shri Shekhar Naphade, learned senior counsels  appearing  on  behalf  of
the respondents.

Assailing the order of the High Court, it is  contended  on  behalf  of  the
appellants that under Section 126 of the MRTP Act grant of TDR against  land
acquired under the Land Acquisition Act is not  contemplated  and  grant  of
TDR is permissible only when the land is acquired by  agreement  and  it  is
further agreed that in  lieu  of  compensation,  TDR  will  be  granted  and
accepted.  It is argued that grant of TDR is a matter of  agreement  between
the acquiring authority and the land  owner  and  the  authority  cannot  be
directed to grant TDR if it is not so willing asmuch as a land owner  cannot
be compelled to accept TDR in the event he opts to accept  compensation  for
the land acquired.  The concept of TDR was brought in  by  an  amendment  to
the MRTP Act in the year 1993 whereas the award for acquisition of the  land
of the respondent society  was  passed  in  the  year  1987  and  possession
thereof was taken over on 21.2.1987.  It is contended  that  the  respondent
society whose land was acquired under the Land Acquisition Act  is  entitled
to compensation calculated on the market value of the land as  on  the  date
of the Notification under Section 4 of the Land Acquisition  Act  which  was
published in the year 1982.  The value of the  benefit,  if  TDR  is  to  be
granted at the present stage, would be grossly  disproportionate.   Pointing
out the provisions of the Development Control  Regulations  governing  grant
of TDR, it is contended that DCR N-.2.4.1(A) and 2.4.17 are required  to  be
read harmoniously and not in isolation as has been done by the  High  Court.
Before DCR N-.2.4.17 can be made applicable, the conditions spelt out  under
DCR N-. 2.4.1(A) has to be satisfied, namely,  that  the  land  should  have
been shown as reserved for a public purpose in the development plan.  It  is
pointed out that in the present case it was not so done and  the  land  was,
in fact, shown as an existing garden.  Therefore,  DCR  N-.2.4.1(A)  is  not
applicable thereby ruling out the application of DCR No.2.4.17.  It is  also
pointed out that the land was acquired under  the  provisions  of  the  Land
Acquisition Act under a non-development plan proposal to  which  acquisition
the provisions of Section 126 of the MRTP Act will have no application.   In
so far as the G.O. dated 03.02.2007 under Section 154 of  the  MRTP  Act  is
concerned, the appellants contend that the said G.O. dated 03.02.2007 is  no
way amends DCR No.2.4.17  as  held  by  the  High  Court;  rather  the  said
directions are merely clarificatory and  were  issued  due  to  large  scale
deviations that have taken place in the matter of grant of TDR.

Opposing the aforesaid contentions advanced on  behalf  of  the  appellants,
Shri  Vinod  Bobde  and  Shri  Shekhar  Naphade,  learned  senior   counsels
appearing on behalf of the respondent - cooperative housing society  in  the
two separate appeals have submitted that the object of  the  amendment  made
in the year 1993 (14.10.1993) introducing the concept of TDR was  to  lessen
the financial burden of the State facing the prospect of making  payment  of
huge compensation money for acquisition  of  land  in  connection  with  the
Development Plan.  Learned counsels have pointed out  that  in  the  present
case the land was eventually included in the development plan  prepared  and
approved under the MRTP Act. The manner  of  inclusion  in  the  development
plan i.e. as an existing garden or as reserved for a garden would  not  make
any difference to the claim of TDR.  It is argued that, though offered,  the
respondent had not accepted any compensation and, in fact, had agitated  for
higher compensation under Section 18 of the  Land  Acquisition  Act.   While
the matter was so pending the concept of TDR came to be  introduced  in  the
Act  and  in  the  year  1997  (05.06.1997)  the  modified  DCR  N-2.4   was
introduced.  The respondent society abandoned the reference made by  it  for
higher compensation and initiated proceedings challenging  the  acquisition.
After  the said challenge was negatived,  the  respondent  society,  in  the
year 2003, lodged a claim for grant of TDR under  DCR  N-2.4.17  (ii)  which
though  initially  was  responded  favourably  was  eventually  rejected  by
placing reliance on the Government Order dated 03.02.2007.   It  is  further
contended that DCR      N-.2.4.17 is  a  stand  alone  provision  and  under
clause (ii) of the said DCR the respondent society is entitled to its  claim
of TDR under the MRTP Act though the  land  had  been  acquired  under  Land
Acquisition Act.  In this regard, it has been specifically pointed out  that
possession of the land was taken from the society in the year 1987 which  is
within 12 years prior to 30th September, 1993  as  contemplated  in  DCR  N-
2.4.17 (ii).  Admittedly, no compensation has been received.  It is  further
submitted that the Government Order dated 03.02.2007 purports to  amend  the
DCR which cannot be so  done  without  following  the  procedure  prescribed
under Section 37 of the MRTP Act.  The fact that  in  similar  circumstances
TDR had been granted to other land owners has also been pointed out  by  the
learned counsels appearing on behalf of the respondent housing society.

In so far as the provisions of Section 126(1) (a) (b) and (c)  of  the  MRTP
Act is concerned, Shri  Vinod  Bobde,  learned  counsel  appearing  for  the
respondent society in C.A. No.3008-3009  of  2010  has  submitted  that  the
availability of TDR to cases of land acquired  under  the  Land  Acquisition
Act after invoking the provisions of Section 126(1)  (c)  of  the  MRTP  Act
will not be open  to  be  raised  either  by  the  State  or  the  Municipal
Corporation once the DCR, particularly DCR N-2.4.17 (ii), had  been  enacted
and brought into force to confer Transferrable Development Rights  for  land
acquired under the provisions of the aforesaid Section  126(1)  (c)  of  the
Act by following the process laid down in the Land  Acquisition  Act.   Shri
Bobde has pointed out that once Regulations have been  framed  contemplating
grant of TDR to  such  land  subjected  to  acquisition  under  Section  126
(1)(c), the Government cannot turn around and refuse to be bound by its  own
norms much less challenge the same.  It  is  further  pointed  out  by  Shri
Bobde that any such plea on the part of the State is not  competent  in  law
and the State cannot seek a decision on the validity of its  self  professed
norms of governance.  So long as the DCR remains its full legal effect  must
be given effect to.

As the issues raised before us will have to be answered on the basis of  the
true and correct purport and effect of the relevant provisions of  the  MRTP
Act; those of the Development Control Regulation  i.e.  DCR  N-2.4.1(A)  and
2.4.17;  and  the  Government  Order  dated  03.02.2007,  the  same  may  be
extracted at the first instance.

Relevant provisions of the MRTP Act

“22. Contents of Development Plan -

      A Development plan shall generally indicate the manner  in  which  the
use of land in the area of the Planning Authority shall  be  regulated,  and
also indicate the manner in which the development of land therein  shall  be
carried out. In particular, it shall provide so far as may be necessary  for
all or any of the following matters, that is to say,-
(a)…………..
(b)………....
(c)………….
(d)……………
(e)……………
(f)……………..
(g)……………..
(h)……………..
(i)…………….
(j)………………
(k)……………….
(l)………………….

 (m)  -  provisions  for  permission  to  be  granted  for  controlling  and
regulating the use and development of land  within  the  jurisdiction  of  a
local authority including imposition of fees, charges and premium,  at  such
rate as may be fixed by the State  Government  or  the  Planning  Authority,
from time to time, for grant of an additional Floor Space Index or  for  the
special permissions or  for  the  use  of  discretionary  powers  under  the
relevant  Development  Control  Regulations,  and  also  for  imposition  of
conditions and restrictions in regard to the open  space  to  be  maintained
about buildings, the percentage of building area for a plot,  the  location,
number, size, height, number of  storeys  and  character  of  buildings  and
density of population allowed in a specified area, the use and  purposes  to
which buildings or specified areas of land may or may not  be  appropriated,
the sub-division of plots the discontinuance of objectionable users of  land
in any area in reasonable periods, parking space and loading  and  unloading
space for any building and the sizes of projections and advertisement  signs
and boardings and other matters as may be considered necessary for  carrying
out the objects of this Act.”



“Section 126. Acquisition of land required for public purposes specified  in
plans  (1)  When  after  the  publication  of  a  draft  Regional  Plan,   a
Development or any other plan or town planning scheme, any land is  required
or reserved for any of the public purposes specified in any plan  or  scheme
under this Act at any time the Planning  Authority,  Development  authority,
or as the case may be,/ any appropriate authority may, except  as  otherwise
provided in Section 113-A,/ acquire the land –

(a)   by an agreement by paying an amount agreed to or,

(b)   in lieu of any such amount, by granting the land-owner or the  leasee,
subject, however, to the lessee paying the lessor  or  depositing  with  the
Planning Authority, Development Authority or Appropriate Authority,  as  the
case may be, for payment to the lessor, an amount equivalent  to  the  value
of the lessor’s interest to be determined by any  of  the  said  Authorities
concerned on the basis of the principles laid down in the  Land  Acquisition
Act, 1894, Floor Space Index (FSI) or Transferable Development Rights  (TDR)
against the area of  land  surrendered  free  of  cost  and  free  from  all
encumbrances, and also further additional Floor Space Index or  Transferable
Development Rights against the development or construction  of  the  amenity
on the surrendered land at this  cost,  as  the  Final  Development  Control
Regulations prepared in this behalf provide, or

(c)   by making an application to the State Government  for  acquiring  such
land under the Land Acquisition Act, 1894.

And  the  land  (together  with  the  amenity,  if  any,  so  developed   or
constructed) so acquired by agreement or by grant of Floor  Space  Index  or
Additional  Floor  Space  or  Transferable  Development  Rights  under  this
Section or under the Land Acquisition Act, 1894, as the case may  be,  shall
vest in the Planning Authority, Development Authority, or as  the  case  may
be, any Appellate Authority.”



Government Order dated 03.02.2007

                                                “Maharashtra Regional & Town
                                                          Planning Act, 1966
                                                 Directive under Section 154
                                                                  About TDR.
                         GOVERNMENT OF MAHARASHTGRA
                        URBAN DEVELOPMENT DEPARTMENT
                        MANTRALAYA, MUMBAI – 400 032.

                          DATED 3rd FEBRUARY, 2007.

                                    ORDER

No. TPS/Sankirna-06/CR-527/06/UD-13:- Whereas the provision of  Transferable
Development Rights (hereinafter referred to as  “the  said  TDR”)  has  been
incorporated in the sanctioned Development Control Regulations  (hereinafter
referred to as “the said DCR”) with a view to reduce  the  financial  burden
of acquisition of lands reserved for  public  purposes  in  the  Development
Plan and for early possession of these lands:

      And  whereas,  sanctioned  Development  Control  Regulations  of  some
Municipal Corporations contain the provision of  rules  regarding  the  said
TDR;

      And whereas, sanctioned the said DCR of  some  Municipal  Corporations
also have provision to grant the said TDR  for  the  lands  acquired  either
under Maharashtra Regional& Town Planning Act,  1966  (hereinafter  referred
to as “the said Act”), Bombay Provincial Municipal Corporation Act,  Private
Negotiation or any other Act  and  possession  of  which  has  already  been
delivered to the Municipal Corporation;

      And whereas, it has come to the notice of  Government  that  the  rule
regarding the grant of TDR such acquired lands have been misinterpreted  and
misused;

      And whereas, once the possession is delivered  after  acquisition  the
rights of the owner are  transferred  to  the  Planning  Authority  and  the
application by the land owner demanding TDR thereafter can  be  said  to  be
made without having any rights in the land;

      After considering the facts and circumstances referred  to  above,  in
exercise of the  powers  conferred  under  Section  154  of  the  said  Act,
Government is pleased to issue directives to all the Municipal  Corporations
as follows:

                                 DIRECTIONS
      All the Municipal Corporations which  have  the  provisions  regarding
grant of Transferable Development Rights  (TDR)  for  the  lands  which  are
acquired under either the MRTP Act, BPMC Act,  Private  Negotiation  or  any
other Act shall initiate modification  proposal  after  following  procedure
laid down under Section 37 of the said Act so as to replace  the  provisions
of this regard by new rules as follows:

NEW RULES:

1)    Transferable Development Rights (TDR) shall not  be  permissible  once
an award has  been  declared  under  the  acquisition  process  and  or  the
possession has already been delivered to  the  Municipal  Corporation  under
any Act.

2)    Municipal Corporation shall punish a notice inviting  suggestions  and
or objections regarding the modification within sixty days from the date  of
issue of this order.

3)    After completing the procedure laid down under Section  37(1)  of  the
said Act Municipal Corporation shall submit the said  modification  proposal
to the Government for final sanction.

4)    Pending the approval  to  the  aforesaid  modification  the  new  rule
mentioned hereinabove shall come into force with effect  from  the  date  of
issue of this notification.

                                                 By order and in the name of
                                                    Governor of Maharashtra.
                                                                        Sd/-
                                                          (Nandkishor Patil)
                                              Under Secretary to Government”

      Development Control Regulation
“N.2.4.1 (A). The owner (or lessee) of a plot of land which is reserved  for
a public purpose, or road construction or road widening in  the  development
plan and for additional amenities deemed  to  be  reservations  provided  in
accordance with these Regulations, excepting in the case of an  existing  or
retention user or to any required compulsory  or  recreational  open  space,
shall be eligible for the word of transferable Development Rights (TDRs)  in
the form of Floor Space Index (FSI) to the extent and on the  condition  set
out below.  Such award will entitle the owner of the land,  to  FSI  in  the
form of a Development Right Certificate (DRC) which be        (sic. he)  may
use for himself or transfer to any other person.

N-2.4.17. Grant of TDR in cases where lands are under acquisition:

(i)  Where Land Acquisition has been declared but request was made  for  TDR
to the Special Land Acquisition Officer after 30th September 1993  i.e.  the
date  of  publication  of  these  draft   Development   Control   Regulation
containing TDR concept.

(ii)  Possession of the land has  been  delivered  without  having  received
part or full compensation under either the  Maharashtra  and  Town  Planning
Act, Bombay Provincial Municipal Corporation  Act,  private  negotiation  or
under any Act for the time being in force within  12  years  prior  to  30th
September 1993.”


9.    Though there is some controversy on the basic  facts,  there  is  also
unanimity to show  that  the  acquisition  of  the  land  belonging  to  the
respondent society was initiated by  notification  dated  28.01.1982  issued
under Section 4 of the Land Acquisition Act, 1894.  It is  also  clear  that
on completion of enquiry under Section 5-A  of  the  Land  Acquisition  Act,
declaration under Section 6 was published on 2.1.1985.  Some  further  facts
on which there is no dispute and therefore would require to  be  taken  note
of, are that the draft revised  development  plan  which  was  published  on
18.9.1982  showed  the  land  as  an  existing  garden  and  in  the   final
development plan which was sanctioned on 5.1.1987, the land was again  shown
as  “existing  garden  as  per  approved   layout”.    The   respondent-writ
petitioner, however, contends  that  the  description  of  the  land  as  an
existing garden is  wrong  and  what  should  have  been  mentioned  in  the
development plan is that the land was proposed for a  garden  as  possession
of  the  same  was  still  with  the  respondent-society  on  the  date   of
publication of the final development plan i.e. 5.1.1987. Possession  of  the
land, as noticed, was taken over on 18.2.1987 whereas the  award  under  the
Land Acquisition Act was made on 22.01.1987.

10.   Having considered the matter we are of the view that it  will  not  be
necessary for us to consider the aforesaid perspective  highlighted  by  the
respondent society as the controversy over the entitlement to TDR under  the
relevant DCR is capable of being resolved on a  wholly  different  basis  to
which aspect of the matter we may now turn.

11.   The concept of TDR was introduced for the first time in the  MRTP  Act
in the year 1993 by an amendment of Section 126(1)(a), (b) and  (c)  of  the
MRTP Act.  The modalities for grant of TDR were brought into  force  by  the
amended Development Control Regulation (for short ‘DCR’) N-2.4  with  effect
from 5.6.1997.  In its simplest  form,  the  concept  of  TDR  involves  the
surrender of land reserved for various public purposes  in  the  development
plan free of cost and in exchange thereof grant of TDR entitling the  holder
thereof to construct a built up area equivalent to the  permissible  FSI  of
the land handed over by him on one or more  plots  in  the  zone  specified.
Such rights are transferable.  The object behind  introduction  of  TDR,  as
admitted by the Pune Municipal Corporation in its various publications,  was
to meet the situation faced by the Corporation on being called upon to  make
payment of over Rs.1500 crores to take over different sites measuring  about
600 hectares which had been reserved for different public  purposes  in  the
development plan.

12.   Strictly construed it is the provisions  of  the  Section  126  (1)(a)
read with (b) of the MRTP Act, extracted earlier,  which  contemplate  grant
of  TDR  and  that  too  only  against  land  acquired   by   agreement   as
distinguished from land which is acquired under the Land Acquisition Act  in
exercise of powers under Section 126(1)(c). The latter kind  of  acquisition
i.e.  under the Land Acquisition Act by invoking Section  126(1)(c)  of  the
MRTP Act however stands on a footing that is different  and  distinguishable
from the normal process of acquisition under the  same  Act  i.e.  the  Land
Acquisition  Act.   This  is  because  in  an  acquisition  under  the  Land
Acquisition Act made in exercise of power under  section  126(1)(c)  of  the
MRTP Act, the provisions of Section 4 and Section 5A of  the  L.A.  Act  are
dispensed with and straightway a notification  under  Section  6  is  to  be
issued.  The market value of the land, though sought to  be  acquired  under
the Land Acquisition Act, is pegged  to  the  date  of  publication  of  the
interim or draft development plan, as  may  be,  and  not  to  the  date  of
publication of the notification under Section  4  of  the  Land  Acquisition
Act.  The above is a subtle but vital difference between  the  ordinary  and
‘normal’ process of acquisition under  the  Land  Acquisition  Act  and  the
process of acquisition under the same Act but in exercise  of  powers  under
Section 126(1)(c) of the MRTP Act that needs to be kept in mind.

13.   DCR N-2.4.1(A) gives effect to the  provisions  of  Section  126(1)(a)
and (b) brought in by the amendment to the MRTP Act in  1993.   It  entitles
the owner or a lessee of a plot of land, which  is  reserved  for  a  public
purpose  in  the  development  plan,  to  the  award  of  TDR  in  lieu   of
compensation upon surrender of the land free of cost.  If, DCR No.N-2.4  had
not contemplated any further  situations  for  grant  of  TDR  the  argument
advanced  on  behalf  of  the  appellants   would   have   merited   serious
consideration.  However, DCR N-2.4.17,  extracted  above,  contemplates  two
other situations for grant of TDR.  Under  DCR  N-2.4.17(ii)  in  situations
where possession of land had been delivered without receipt of part or  full
compensation  payable  under  the  MRTP  Act,  Bombay  Provincial  Municipal
Corporation Act, private negotiations or under any Act and  such  event  had
occurred within 12 years prior to 30.9.1993  (date  of  publication  of  the
draft DCR containing the TDR concept) claims for grant of TDR  are  required
to be entertained.   DCR  N-2.4.17  extends  the  frontiers  outlined  under
Section 126(1)(a) and (c) and makes  the  grant  of  TDR  applicable  to  an
extended class of cases wherein acquisition of land is made not  only  under
the MRTP Act but also under other enactments including the L.A.  Act.   Such
an extension appears  to  be  in  consonance  with  the  object  behind  the
introduction of the concept of TDR by the  amendment  of  the  MRTP  Act  of
1993.  Having regard to the clear language  contained  in  DCR  N-2.4.17(ii)
and the object sought to be achieved by the introduction of TDR, we  do  not
see as to how grant of TDR can be confined only  to  cases  of  lands  which
have been reserved in the development plan and not to lands  acquired  under
the Land Acquisition Act  which  land  eventually  becomes  a  part  of  the
finally approved and sanctioned development  plan.   The  above  would  also
lead  to  the  conclusion  that  DCR  N-2.4.17  is  capable   of   operating
independently and is not contingent  on  the  existence  of  the  conditions
mentioned in DRC N-2.4.1(A).

14. The matter needs to be viewed from another perspective.  The  difference
between acquisition under the L.A.  Act  by  resort  to  the  provisions  of
Section 126(1)(c) of the MRTP Act and acquisition dehors the said  provision
of the MRTP Act has already been noted.  If under DCR N-2.4.17, TDR  can  be
granted in cases of acquisition under the  MRTP  Act  obviously  acquisition
under the LA Act upon invocation of Section  126(1)(c)  would  be  included.
In such a situation, reference to  any  other  Act  in  DCR  N-2.4.17  would
include the L.A. Act so as to bring land covered by the  normal  process  of
acquisitions under the L.A.  Act  within  the  fold  of  DCR  N-2.4.17.  The
acquisition  of  the  land  belonging  to  the  respondent  society   would,
therefore, be clearly covered by the provisions of DCR N-2.4.17.

15.   “Making of DCR or amendments thereof  are  legislative  functions.”[1]
The Government Order dated 3.2.2007, though claimed to be  clarificatory  by
the appellants, really, seeks to prohibit the grant  of  DCR  under  DCR  N-
2.4.17 so far as lands in respect of which Award under the Land  Acquisition
Act had been passed or possession of which has been  taken  over.   This  is
contrary to the clear intent  behind  DCR  N-2.4.17.  The  Government  Order
itself acknowledges the necessity of following the procedure  prescribed  by
Section 37 of the MRTP Act before the aforesaid  modification  could  become
effective.  Yet, surprisingly the Government Order goes on  to  state  that,
“Pending approval of the  aforesaid  modification  the  new  rule  mentioned
hereinabove shall come into force with effect from  the  date  of  issue  of
this notification”.  The Government Order in question,  having  been  issued
under Section 154 of the MRTP Act, therefore, cannot  override  the  DCR  N-
2.4.17 as the directions under Section 154 of the MRTP Act would be  in  the
nature of administrative instructions (Laxminarayan R.  Bhattad  and  Others
Vs. State of Maharashtra  and  Another[2]).   Admittedly,  at  the  relevant
point of time, the requisite process under Section 37 of the  MRTP  Act  had
not been completed.

16.   Underlying the arguments advanced on behalf of  the  appellants  is  a
fundamental issue that would require a  brief  mention.   The  present  case
discloses a somewhat disturbing course of action adopted  by  the  State  in
seeking to disown and challenge its own professed  standards  laid  down  in
the form of a DCR by tangentially contending the same to be  incompetent  in
law.  Such a course of action by the State seeking to depart from its  self-
professed norms is neither  permissible  nor  would  the  Court  require  to
consider the same.  The DCR governing the grant of TDR though may have  gone
beyond  what  is  contemplated  under  the  MRTP  Act,  the  State  and  its
authorities cannot  be  permitted  to  request  the  Court  to  collaterally
adjudge the validity of the said norms laid down by the  State  itself.   It
is for the State to effect necessary corrections as deemed  proper  and  not
search for an escape valve through a judicial verdict.   Such  a  course  of
action is jurisprudentially impermissible.  So long as  the  DCR  holds  the
field all executive actions must be within the four corners thereof. We  can
usefully remind ourselves of the  observations  of  Justice  Frankfurter  in
Viteralli Vs. Seaton[3] approved in R.D. Shetty  Vs.  International  Airport
Authority[4] :

“An executive agency must be rigorously held to the standards  by  which  it
professes its  action  to  be  judged.   ..Accordingly,  if  dismissal  from
employment is based on a defined procedure, even though generous beyond  the
requirements that bind the  agency,  that  procedure  must  be  scrupulously
observed…This judicially evolved rule of administrative law  is  now  firmly
established and, if I may add, rightly so.  He  that  takes  the  procedural
sword shall perish with the sword.”



17.    For  the  above-stated  reasons,  the  conclusion  is  obvious.   The
rejection of the claim of the respondent Society to TDR under the  MRTP  Act
read with DCR N-2.4.17 is seriously flawed. We,  therefore,  set  aside  the
same; affirm the order dated 15.9.2009 of the Bombay High Court in the  writ
petition filed by  the  respondent  Society  and  consequently  dismiss  the
appeals  filed  by  the  Pune  Municipal  Corporation  and  the   State   of
Maharashtra.


                                                               ……………………………J.
                                           [RANJAN GOGOI]



                                                           ..………………..………..J.
                                           [M.Y.EQBAL]
New Delhi;
October 09, 2014.






-----------------------
[1]     Pune Municipal Corporation and Anr. Vs. Promoters and Builders
Association and Anr. [(2004) 10 SCC 796]
[2]    (2003) 5 SCC 413
[3]    3.L Ed.2d. 1012
[4]    (1979) 3 SCC 489

-----------------------
26

whether the appellant be granted leave to defend the eviction petition filed by the respondents-landlords. = when there is a fair dispute to be tried in the eviction petition and the appellant be granted leave to defend. However, leave to defend could be granted to the appellant only conditionally. =2014 - Oct- Part- SHANTI DEVI ...Appellant Versus RAJESH KUMAR JAIN & ANR. ..Respondents

                                                              NON-REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

                       CIVIL APPEAL NO. 9378  OF 2014
                 (Arising out of SLP (Civil) No. 37274/2012)


SHANTI DEVI                                            ...Appellant

                                   Versus

RAJESH KUMAR JAIN & ANR.                          ..Respondents



                                  O R D E R


R. BANUMATHI, J.

Leave granted.
2.          In this appeal, short  question  falling  for  consideration  is
whether the appellant be granted  leave  to  defend  the  eviction  petition
filed by the respondents-landlords.
3.          Appellant is a tenant in respect of shop premises  situated   on
the ground floor of  a  property  No.  6157,  Partap  Street,  Behind  Kothi
Bhagwan  Dass,  Gandhi  Nagar,           Delhi  -110031  since  1988.    The
appellant has been engaged in carrying on her business (Disco Hair  Dresser)
in the said premises.  The respondents-landlords filed an eviction  petition
under Section 14 (1) (e) of Delhi Rent Control Act  (DRC  Act)  against  the
appellant, interalia, on the ground of bonafide requirement to open  office-
cum-display counter on the main  road  side  to  expand  their  business  of
cosmetic unit.  The appellant filed application under  Section  25B  (5)  of
DRC Act read with Section 151 CPC  seeking  leave  to  defend  the  eviction
petition.   The  appellant  raised  the  plea  that  there  is  no  bonafide
requirement and that the respondents  have  alternative  accommodation.  The
Addl. Rent Controller, Karkardooma Court, Delhi  dismissed  the  application
of the appellant-tenant on the ground  that  the  appellant  has  failed  to
raise any triable issue.  Being  aggrieved,  the  appellant  filed  revision
petition before the High Court under sub-section (8) of Section 25B  of  DRC
Act and the same was dismissed.  Hence, this appeal by special leave.
4.          We  have  heard  counsel  for  the  appearing  parties.  Learned
counsel for respondents contended that the landlords needed the property  in
question to expand their business, as the space currently available to  them
is insufficient. It was submitted that the  appellant-tenant  owned  another
property, along with her husband in  the  same  locality,  where  she  could
shift her business. The appellant-tenant denied the  issues  raised  by  the
respondents-landlords with respect to having alternative accommodations.
5.          We are not inclined to go into the merits of rival  contentions,
lest, it would amount to expression of views on the merits  of  the  matter.
In the facts and circumstances of the case, we are of  the  view,  that  the
appellant has raised a triable issue, in the sense, that  there  is  a  fair
dispute to be tried in the eviction petition and the  appellant  be  granted
leave to  defend.   However,  leave  to  defend  could  be  granted  to  the
appellant only  conditionally.   When  the  revision  petition  was  pending
before the High Court, the appellant agreed to pay to the landlords rent  at
the rate of Rs.3,000/- per month and the same could be continued.
6.          The impugned order of the High Court in  Revision  Petition  No.
347/2011 is set aside and the appeal is allowed.  The appellant  shall  file
her reply statement before the Addl.  Rent  Controller,  Karkardooma  Court,
Delhi within four weeks from today and the  learned  Addl.  Rent  Controller
shall afford sufficient opportunity to both the  parties  and  proceed  with
the matter in accordance with law and dispose of the same preferably  within
a period of six months from the date of  receipt  of  copy  of  this  Order.
Till the disposal of the eviction petition, the appellant shall continue  to
pay rent at the rate of           Rs.3,000/- per month on or before  7th  of
each succeeding English calendar month.   No costs.

                                                                 …………………………J
                                             (T.S. Thakur)


                                                                 …………………………J
                                                              (R. Banumathi)
New Delhi;
October 9, 2014
-----------------------
4

Govt. Tenders -Refusing to accept the tender at end as in the earlier tender the parties failed to perform the contract - In earlier litigation, the clause 7 was invoked but high court refused to accept the same for debarring the parties for 7 years - Apex court held that the high court failed to interpret it' own order properly and as such set aside the same and allowed the appeal = CIVIL APPEAL NO. 9379 OF 2014 (Arising out of SLP (Civil) No.33798/2012) SHREE SHYAMJI TRANSPORT COMPANY ... Appellant Versus FOOD CORPORATION OF INDIA & ORS. ...Respondents = 2014-Oct. month-http://judis.nic.in/supremecourt/imgst.aspx?filename=41981

  Govt. Tenders -Refusing to accept the tender at end as in the earlier tender the parties failed to perform the contract - In earlier litigation, the clause 7 was invoked but high  court refused to accept the same for debarring the parties for 7 years - Apex court held that the high court failed to interpret it' own order properly and as such set aside the same and allowed the appeal =

   FCI invited tenders for Mandi Labour Contract  (MLC)  for
its centres at Uchana, Sonepat,  Narwana  and  Safidon  and  the  appellants
applied for the tender.  The tender consisted of two parts -  technical  bid
and price bid.   As  per  the  procedure,  on  successfully  qualifying  the
technical bid, the  price  bid  was  to  be  opened.   The  appellants  were
eligible in technical bid thereby making themselves  qualified  for  opening
of price bid.  The said price bid was opened on 2.3.2012.   The  appellants’
bid was not considered by FCI, in view of  the  fact  that  in  the  earlier
tender of Road Transport Contract (RTC) of Hathin–Rajasthan, the  appellants
had failed to deposit the security deposit and  bank  guarantee  within  the
stipulated period as required and the Earnest Money  Deposit  (EMD)  of  the
appellants had been forfeited vide Order  dated  5.11.2011  and  hence,  the
appellants’ MLC tender was rejected invoking sub clause (III)  of  Clause  4
of the Disqualification Conditions.=

Clause 7 of the MTF      to debar the appellants for  the  contract  period.
It appears that apprehension of debarment of appellants  invoking  Clause  7
was brought to the notice of the Court and the High Court did  consider  the
same as a necessary point.  In our view, the finding of  the  Court  on  the
same is binding  on  FCI.   Inspite  of  FCI’s  modification  petition,  the
finding that there was no intentional lapse on the part  of  the  appellant-
Shree Shyamji Transport Company, was neither modified nor set aside.    That
being so, while considering  the appellant’s  tender  for  MLC, FCI was  not
justified in invoking Clause 4 (III) of the MTF  on the  ground   that   the
tender of the appellants pertaining  to  RTC  Hathin–Rajasthan  was  earlier
rejected and that appellant’s EMD was forfeited. High Court,  in  our  view,
has not properly appreciated its own observations in CWP No.21694/2011  that
FCI has not invoked Clause 7 of the MTF to  debar  the  appellants  for  the
contract period.
    2014-Oct. month-http://judis.nic.in/supremecourt/imgst.aspx?filename=41981

                                                        REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

                       CIVIL APPEAL NO. 9379   OF 2014
                 (Arising out of SLP (Civil) No.33798/2012)


SHREE SHYAMJI TRANSPORT COMPANY        ... Appellant

                                   Versus

FOOD CORPORATION OF INDIA & ORS.           ...Respondents

                                    WITH

                       CIVIL APPEAL NO. 9380  OF 2014
                 (Arising out of SLP (Civil) No. 3928/2013)


M/S  R.S. LABOUR AND TPT. CONTRACTOR          ..Appellant

                                   Versus

FOOD CORPORATION OF INDIA & ORS.          ..Respondents



                               J U D G M E N T


R. BANUMATHI, J.


            Leave granted.   These appeals arise out of common order of  the
Punjab and Haryana High Court dated 26.7.2012 passed in CWP  Nos.  8415/2012
& 8416/2012 whereby the High Court declined to interfere with the action  of
the Food Corporation of India (FCI)  rejecting  tender  of  the  appellants-
firms.
2.          Brief facts leading to  the  filing  of  these  appeals  are  as
follows:-  The  appellants  are  partnership  firms  having  five  partners.
Respondent No. 2 - FCI invited tenders for Mandi Labour Contract  (MLC)  for
its centres at Uchana, Sonepat,  Narwana  and  Safidon  and  the  appellants
applied for the tender.  The tender consisted of two parts -  technical  bid
and price bid.   As  per  the  procedure,  on  successfully  qualifying  the
technical bid, the  price  bid  was  to  be  opened.   The  appellants  were
eligible in technical bid thereby making themselves  qualified  for  opening
of price bid.  The said price bid was opened on 2.3.2012.   The  appellants’
bid was not considered by FCI, in view of  the  fact  that  in  the  earlier
tender of Road Transport Contract (RTC) of Hathin–Rajasthan, the  appellants
had failed to deposit the security deposit and  bank  guarantee  within  the
stipulated period as required and the Earnest Money  Deposit  (EMD)  of  the
appellants had been forfeited vide Order  dated  5.11.2011  and  hence,  the
appellants’ MLC tender was rejected invoking sub clause (III)  of  Clause  4
of the Disqualification Conditions. According  to  the  appellants,  earlier
tender of the appellants was rejected by an Order  dated 5.11.2011  invoking
Clause 7 of the  Model  Tender  Form  (MTF).   The  appellant-Shree  Shyamji
Transport Company challenged  the said Order dated 5.11.2011 by  filing  CWP
No.21694/2011 which was disposed of by Order dated  6.3.2012  in  which  the
Court observed that FCI had not invoked Clause 7 of the MTF   to  debar  the
appellant-Shree Shyamji Transport Company for the contract  period  and  the
apprehension of the appellant  was   ill-founded.    In  the  light  of  the
observations in CWP No.21694/2011, appellants contend that the  Order  dated
21.3.2012 rejecting the appellants’ tender for MLC invoking Clause  4  (III)
is unsustainable.
3.          Challenging action of the respondents - FCI in  not  considering
their MLC tender, the appellants filed two writ petitions bearing  Nos.  CWP
8415/2012 and 8416/2012 to quash the communication dated 21.3.2012 and  also
prayed for consideration of their price bid with regard to MLC tender  dated
14.3.2012.  The High Court dismissed the writ petitions by  a  common  Order
dated 26.7.2012, interalia, on the  grounds:-   (i)  In  the  Writ  Petition
No.21694/2011,  forfeiture of Earnest Money Deposit (EMD) of the  appellants
was not set aside by  the  Court  and  forfeiture  of  earnest  money  stood
sustained  justifying  the  invocation  of  Clause  4  (III);           (ii)
appellants had also not challenged the action of the  respondents  declaring
it to be   disqualified  under  Clause  4  (III)  of  the  MTF.    Aggrieved
appellants are before us.
4.          Assailing the impugned order, Mr. Jasbir  Singh  Malik,  learned
counsel appearing for the appellants   submitted that in the  light  of  the
order dated 6.3.2012 passed in CWP No.21694/2011, it was  not  open  to  the
respondents to forfeit the earnest money in  respect  of  Hathin  –Rajasthan
RTC tender by invoking Clause 7 of the MTF and the learned  High  Court  did
not correctly interpret its  earlier  order  passed  in  CWP  No.21694/2011.
Learned counsel further submitted that  the  High  Court  has  committed  an
error in observing that the appellant has not challenged the action  of  the
respondents declaring it to be disqualified under Clause 4 (III) of the  MTF
whereas the appellant-firm had actually challenged the  action  of  the  FCI
disqualifying the appellant under Clause 4 (III)  of  the  MTF  in  CWP  No.
8415/2012, contending that Clause  4  (III)  could  not  have  been  invoked
against the appellants.
5.          Refuting the above  contentions,  Mr.  Ajit  Pudussery,  learned
counsel appearing for the respondents, submitted   that  admittedly  EMD  of
the  appellant-firm   in   RTC                              Hathin–Rajasthan
tender was forfeited and forfeiture of EMD was not set  aside  by  the  High
Court in the CWP                   No.21694/2011  and  FCI  rightly  invoked
clause 4(III) of the MTF against the  appellants  in  MLC  Tender.   It  was
submitted that in CWP No.21694/2011, the  High  Court  has  wrongly  assumed
that Clause 7 of the MTF was not being invoked,  when  in  fact  action  had
been taken under Clause 7 only      and thus the  presumption  made  by  the
High Court in  CWP    No.21694/2011  is  contrary  to  the  record.  Learned
counsel  further submitted that strict compliance of tender  conditions  are
provided to ensure that only serious tenderers participate in  the  bids  as
in case after the award of contract if the tenderer  fails  to  perform  his
due obligations,  huge amount of public money is wasted in re-tendering  and
also creating a situation affecting the movement and  distribution  of  food
grains  which  is  not  in  public  interest  and  the  High  Court  rightly
interpreted Clause 4(III) and the impugned order warrants no interference.
6.          We have considered the rival submissions  made  by  the  learned
counsel for the parties and perused the record.  The  question  falling  for
consideration is  that  in  the  light  of  the  observations  made  in  CWP
No.21694/2011 whether the High Court was right in upholding  the  action  of
the respondents-FCI declaring the appellants-firms to be disqualified  under
Clause 4 (III) of the MTF.
7.          Clause 4 (III) of the MTF stipulates  that  the  tenderer  whose
EMD was forfeited in any other contract with FCI during the last five  years
will be ineligible to participate in the bid. For  better  appreciation,  we
may refer to the relevant clause 4 (III) and relevant paras in Clause  5  of
the MTF which read as under:-
“Clause  4. Disqualification Conditions
………
(III)       Tenderer whose Earnest Money  Deposit  and/or  Security  Deposit
has been forfeited by Food  Corporation  of  India   or  any  Department  of
Central or State Government or any other Public  Sector/Undertaking,  during
the last five years, will be ineligible.

“Clause 5.  Details of Sister Concerns.
………..
(i)   The blacklisted parties by FCI or Govt./Quasi Govt. Organization  will
not be qualified.
(ii)  The parties whose EMD is forfeited by FCI will not be qualified.
(iii) Food Corporation of India reserves the right not to  consider  parties
having any dispute with Food Corporation of India in order  to  protect  its
interest.”


8.          According to  the  respondents,  EMD  of  the  appellant-  Shree
Shyamji Transport Company was forfeited   in  the  earlier  tender  of  Road
Transport Contract  (RTC)                   -Hathin-Rajasthan,   making  the
appellant ineligible to bid in the MLC tender and  therefore,  the  bid   of
the appellant for MLC was rightly rejected by the respondents-FCI  by  Order
dated 21.3.2012.
9.          Insofar as RTC tender  for  Hathin–Rajasthan  is  concerned,  it
appears from the record and the observations of the High Court  in  CWP  No.
21694/2011 that there was no intentional lapse on the part of the  appellant
and the delay in furnishing the security and  the  bank  guarantee  appeared
  to be on account of failure of  banking  operations.    As  per  Clause  7
(iii) of MTF, the successful tenderer within fifteen days of  acceptance  of
its tender, must furnish security deposit for the  due  performance  of  his
obligation under the contract.  While dismissing the writ petition  CWP  No.
21694/2011 on 6.3.2012, High Court observed  that  respondents-FCI  did  not
have any intention to invoke that part of Clause 7  of  the  MTF  indicating
that the respondents-FCI preferred  not  to  debar  the  appellant  for  the
contract period.  For proper appreciation of the contention of the  parties,
it is relevant to refer to the order of the High Court in CWP  No.21694/2011
which reads as under:-
“In so far as  the argument  of  the  learned  counsel  for  the  petitioner
apprehending  debarment  under clause 7  of the MTF is concerned, we are  of
the view that there is nothing  in the impugned order dated  05.11.2011  (P-
16) which may indicate that the respondents have  any  intention  to  invoke
that part of  clause 7 against the petitioner.  The reason for not  invoking
 clause 7 of the MTF appears to be  that  there  is  no  intentional   lapse
committed by the petitioner and the delay  in furnishing  the  security  and
the  bank  guarantee  appears  to  be  on  account  of  failure  of  banking
operations.   Therefore, we appreciate   the  respondents   for  not  having
invoked  clause 7 of the MTF to  debar  the  petitioner   for  the  contract
period.  Therefore, the apprehension of the petitioner    expressed  through
their counsel is ill founded.”

10.          The  respondents-FCI,  in  fact,  filed   Civil   Miscellaneous
Application No.4480/2012 seeking  modification  of  the  above  order  dated
6.3.2012 and prayed to hold that Clause  7(iii)  of  the  MTF  includes  the
debarring of the contractor  and  its  partners  i.e.  the  appellants  from
participating in any future tender of the FCI for a period of  three  years.
By order dated  2.4.2012, the Division Bench of the High Court  disposed  of
the said application and other applications reiterating  its  earlier  order
dated 6.3.2012 that FCI in its order  dated  5.11.2011  (pertaining  to  RTC
Hathin–Rajasthan) did not indicate any intention to  invoke   that  part  of
Clause 7 of MTF to debar the appellants’ firm for the contract period.   The
said Order of the High Court dated 2.4.2012 reads as under:-

“It is thus evident that this Bench has taken the view  that  in  the  order
dated 05.11.2011 (P-16), the respondents did not indicate any  intention  of
invoking  that part of clause 7 of MTF which could  debar   the  petitioner.
The reason for adopting  the aforesaid course has also  been  noted  by  the
Division  Bench   by  observing   that  there   was  no  intentional   lapse
committed by the petitioner and the delay in furnishing   the  security  and
the bank guarantee was on account of  failure  of banking  operations.   The
Bench, in fact, appreciated the respondents for not  invoking  the  part  of
clause 7 of  the MTF  to debar the petitioner   for  the  contract  period.”



11.         Insofar as RTC Hathin–Rajasthan is  concerned,  finding  of  the
High Court that there was no intentional lapse on the part of the  appellant
and that delay in furnishing the security and bank guarantee was on  account
of failure of banking  operation  had  attained  finality.  In  response  to
appellants’ apprehension of debarment under Clause 7 of MTF, Division  Bench
has recorded its finding that  it  appreciates  that  FCI  has  not  invoked
Clause 7 of the MTF      to debar the appellants for  the  contract  period.
It appears that apprehension of debarment of appellants  invoking  Clause  7
was brought to the notice of the Court and the High Court did  consider  the
same as a necessary point.  In our view, the finding of  the  Court  on  the
same is binding  on  FCI.   Inspite  of  FCI’s  modification  petition,  the
finding that there was no intentional lapse on the part  of  the  appellant-
Shree Shyamji Transport Company, was neither modified nor set aside.    That
being so, while considering  the appellant’s  tender  for  MLC, FCI was  not
justified in invoking Clause 4 (III) of the MTF  on the  ground   that   the
tender of the appellants pertaining  to  RTC  Hathin–Rajasthan  was  earlier
rejected and that appellant’s EMD was forfeited. High Court,  in  our  view,
has not properly appreciated its own observations in CWP No.21694/2011  that
FCI has not invoked Clause 7 of the MTF to  debar  the  appellants  for  the
contract period.
12.         The impugned tenders pertain to Mandi Labour Contract (MLC)  for
which the appellants submitted their bid  on  2.3.2012  and  the  appellants
have already suffered debarment for about  three  years.    Considering  the
facts and circumstances of the  case  and  in  the  light  of  High  Court’s
observation made in CWP No.21694/2011, in our view,  the  debarment  of  the
appellants is not justifiable and the  impugned  order  of  the  High  Court
cannot be sustained.
13.         In the result, the impugned order  of  the  High  Court  is  set
aside and the appeals are allowed.  No order as to costs.


                                                                 …………………….J.
                                                               (T.S. Thakur)


                                                                 …………………….J.
                                                              (R. Banumathi)

New Delhi;
October 9, 2014
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