1 CWP No.5133/2001 & 5115/2001 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JAI PUR BENCH JAIPUR ORDER 1. S.B.CIVIL WRIT PETITION NO.5133/2001 Narendra Kumar-Chandra Kanta Kothari Charitable Trust & Anr. Versus State of Rajasthan & another. 2. S.B.CIVIL WRIT PETITION NO.5115/2001 Pradeep Jain vs. State of Raj. & Another. DATE OF ORDER --- July 22,2010 PRESENT HON’BLE MR.JUSTICE PREM SHANKER ASOPA Mr. Sanjay Mehrishi for the petitioners. Mr. Jinesh Jain, Govt. Counsel. REPORTABLE By the Court (Oral) (1) Heard learned counsel for the parties. (2) In the aforesaid two writ petitions, common question of facts and law regarding demand of conversion charges after more than a decade of granting permission for construction by the Municipal Board, Jhalawar, are involved and, therefore, both the writ petitions have been clubbed and are being decided by this common order. Facts relating to S.B. Civil Writ Petition No.5133/2001:- (3) On the land which was neither allotted or sold by respondent No.2 Municipality nor by the State Government, one Narendra Kumar Kothari sought permission for construction of five shops as per the attached plan which was granted by the Municipal Board, Jhalawar vide order dated 13.11.1979 after receiving the requisite fees and charges. In the plan, location of the five shops has been mentioned and the same have been constructed. The said property subsequently vested in the petitioner trust. On 16.11.2000, 28.4.2001, 16/18.6.2001 and 2 CWP No.5133/2001 & 5115/2001 16.7.2001 notices were issued by respondent no.2 to the petitioner trust asking them to deposit the conversion charges for using the premises for commercial purposes. The petitioners submitted reply to the said notices wherein it has been specifically pleaded that the permission for construction of the shops was given by the respondent No.2 as per the Rules and the plan of the shops was approved after receiving the requisite fees and charges for construction, therefore, there is no justification to raise demand of the conversion charges after more than a decade. The conversion charges under the provisions of the Rajasthan Municipalities Act, 1959 (hereinafter referred to as `the Act of 1959') are not applicable on the premises which were neither sold or allotted either by the Municipality or by the State Government. Facts relating to S.B. Civil Writ Petition No.5115/2001:- (4) Late Shri Harak Chand ji Jain, grand-father of petitioner Pradeep Jain, purchased Plot No.7-C from Shri Mathuralal through registered sale-deed dated 4.6.1984 and in the sale-deed there is no reference that the land is residential land. Subsequently, permission for construction of a Nursing Home was sought and vide order dated 17.10.1985 permission to construct the Nursing Home as per the approved plans, was granted by the Municipality after receiving the requisite fees and charges. On 15.11.2000, 28.4.2001 and 10.1.2001 notices were issued by respondent no.2 demanding conversion charges from the petitioner. The petitioner sent reply to the said notices and specifically mentioned the fact that the plans of the Nursing Home were approved by the Municipality after receiving the requisite fees and charges, therefore, demand of conversion charges after more than a decade is not justified. In the writ petition it is also stated that the Nursing Home was 3 CWP No.5133/2001 & 5115/2001 constructed neither on the land belonging to the Municipality nor to the State Government rather it was a private land. (5) In reply, the respondents have justified the demand of conversion charges on the ground that at the time, the plans were approved, no such charges were taken from the petitioner(s)/ respective owner of the land and since the land use has been changed to commercial, therefore, the demand of conversion charges is justified. (6) Learned counsel for the petitioners has raised the legal submission that conversion charges can only be demanded under unamended Section 173-A of the Act of 1959 which was applicable in the years 1979 and 1985 when permission for construction of shops and nursing home was issued with regard to change of use of land either allotted or sold by the Municipality or by the State Government whereas in the instant cases, the land in question was neither allotted nor sold by the Municipality or the State Government, therefore, no demand of conversion charges can be raised under unamended Section 173-A of the Act of 1959. He further submits that the notification dated 30.9.1999 whereby Section 173-A of the Act of 1959 and the rules framed thereunder were amended has no retrospective application. (7) Counsel for the petitioners also submits that there is no justification to issue demand notices of conversion charges after more than a decade of approving the plans for construction of shops and nursing home, which are essentially commercial in nature. Learned counsel for the petitioners then submits that in the permission letters issued by the Municipal Board for construction of the shops and nursing home, there is no such condition that the building can be utilised for the residential purposes only. Otherwise also, no opportunity of hearing was given to the petitioners before raising the demand. 4 CWP No.5133/2001 & 5115/2001 (8) In support of his submissions, learned counsel for the petitioners has placed reliance on the D.B. Judgment of this Court in the matter of Municipal Corporation, Jodhpur & Anr. vs. Rajendra Bhandari & Anr. {2000 DNJ (Raj.) 485} wherein it has been held that demand of conversion charges under Section 173-A of the Act of 1959 cannot be made in respect of the land which was neither sold nor allotted either by the Municipality or the State Government. Learned counsel for the petitioners further placed reliance on the judgment of learned Single Judge in the matter of Lalit Kumar Bothra vs. Municipal Board,Sheoganj { 2001 DNJ (Raj.) 455} wherein this Court has held that the Notification dated 30.9.1999 issued by the State Government making amendment in Section 173-A of the Act of 1959, in respect of conversion charges, is having no retrospective application. (9) Per contra, the submission of the learned counsel for the respondents is that the petitioners have changed the use of the premises, therefore, they are justified in demanding the charges which were not deposited by the petitioners at the time of approval of the plan but neither any legal provision has been referred to in the reply nor pointed out while making oral submissions for charging the conversion charges in respect of the land which was neither sold nor allotted either by the Municipality or the State Government. (10) I have gone through the record of both the writ petitions and further considered the rival submissions of counsel for the parties. (11) Before proceeding further I would like to quote unamended Section 173-A of the Act of 1959, which was in existence in the years 1979 and 1985 when the permission for construction of shops and nursing home was granted, which reads thus:- “ 173-A. Power of the State Government to allow change in the use of land- (1) 5 CWP No.5133/2001 & 5115/2001 Notwithstanding anything contained in this Act, where any land has been allotted or sold to any person by a municipality or the State Government subject to the condition of restraining its use for a particular purpose, the State Government may, if it is satisfied so to do in public interest, allow the owner or holder of such land to use it for any other purpose other than the purpose for which it was originally allotted or sold, on payment of such conversion charges as may be prescribed: Provided that the rates of conversion charges may be different for different areas and for different purposes. (emphasis supplied) (2)The conversion charges so realised shall be credited to the Consolidated Fund of the State or to the fund of the municipality as may be determined by the State Government. (3)Such charges shall be the first charge on the interest of the person liable in the land the use of which has been changed and shall be recoverable as arrears of land revenue.” (12) In the matter of Municipal Corporation, Jodhpur & Anr. vs. Rajendra Bhandari & Anr. (supra) in para no.11 of the judgment, the Division Bench of the Principal Seat at Jodhpur has considered the unamended section 173-A of the Act of 1959 and has observed as under:- “ A bare reading of Sec.173-A shows that for the application of this section, two conditions are necessary: (1) that the land has been allotted or sold to any person by the Municipality or the State Government and (2) that the allotment or sale of the land by the Municipality or the State Government was subject to the condition of restraining its use for a particular purpose. If either of these two conditions is fulfilled, the provisions of Sec.173-A will not apply. (emphasis supplied) In other words, the provisions of Sec. 173-A have no application to the land which had been obtained by a person otherwise than by allotment or sale by the State Government or the Municipality and in case of land allotted or sold by the Municipality or the State Government, the power to demand conversion charges would be exerciseable only in those cases in which the land was allotted or sold subject to the condition that the land would be used for a specific purposes only.” 6 CWP No.5133/2001 & 5115/2001 (13) Thus, a bare perusal of the aforesaid judgments would reveal that for making unamended Section 173-A of the Act of 1959 relating to conversion charges applicable, two conditions are necessary: (1) that the land has been allotted or sold to any person by the Municipality or the State Government and (2) that the allotment or sale of land by the Municipality or the State Government was subject to the condition of restraining its use for a particular purpose. If either of these two conditions is not fulfilled, the provisions of unamended Section 173-A of the Act of 1959 in existence at the time of granting permission for construction of shops and nursing home will not apply. (14) Single Bench of this Court in the matter of Lalit Kumar Bothra (supra) has considered the Notification dated 30.9.1999 making amendment in Section 173-A of the Act of 1959 and the rules framed thereunder and has held that the said Notification is not retrospective in operation so as to validate the orders made under the then existing provisions before its amendment. Para 4 and relevant part of para 5 of the same are as under:- “ 4. This proposition has not been contested by learned counsel for the respondent either that the Division Bench has held that power to levy conversion charges u/s.173-A is not applicable where the grant is not conditioned by restricting the right of the grantee about the user of the land in particular manner. However, he contends that since the Division Bench has not taken into consideration the Notification dated 30.9.1999 making amendment in Sec. 173-A and rules framed thereunder, the question requires reconsideration. 5. I am unable to agree inasmuch as there is nothing in the Notification which makes it retrospective in operation so as to validate the orders made under the then existing provisions before its amendment, nor any provision of the amended section makes any change so far as the principle of levying conversion charges only to a 7 CWP No.5133/2001 & 5115/2001 case when a person uses or permits the use of any land situated in municipal area for the purpose other than for which the land was originally allotted or sold by the State Government to any person.” (emphasis supplied) (15) Adverting to the facts of these cases it is clear that the lands in dispute were neither allotted nor sold either by the Municipality or by the State Government, therefore, unamended and amended provisions of Section 173-A of the Act of 1959 have no application and the demand of conversion charges is wholly unjustified. (16) In view of the aforesaid decisions on the unamended and amended Section 173-A of the Act of 1959, I need not decide the other issues raised by the learned counsel for the petitioners. (17) Accordingly, both the writ petitions are allowed. Notice No.1531 dated 16/18.6.2001 (Annexure-5) and Notice No.1732 dated 16.7.2001 (Annexure-6) in S.B. Civil Writ Petition No.5133/2001 and Notice No.1533 dated 16/18.6.2001 (Annexure-5) in S.B. Civil Writ Petition No.5115/2001 are quashed. (18) No orders as to cost. (Prem Shanker Asopa) J. bai r wa/गोpa ल All corrections made in the judgment/ order have been incorporated in the judgment/ order being e-mailed. Gopal Lal Sharma Private Secretary