IN THE HIGH COURT OF JUDICATURE AT MADRAS DATE:29-02-2008 CORAM: THE HON'BLE MR.JUSTICE P.JYOTHIMANI W.P.Nos.13440 and 46153 of 2006 and connected miscellaneous petitions New Kenilworth Hotel Pvt., Ltd., No.1 & 2 Little Russel Street Kolkatta 700 071 rep. By its Authorised Signatory Mr.Sudipta Nandi. .. Petitioner in WP.13440/06 New Kenilworth Hotel Pvt., Ltd., No.1 & 2 Little Russel Street Kolkatta 700 071 rep. By its Authorised Signatory Mr.A.Joseph Vincent. .. Petitioner in WP.46153/06 vs. 1.State of Tamil Nadu rep. By the Secretary to the Government, Social Welfare and N.M.P.(SW-V) Department, Fort St.George, Chennai 9. 2.The State of Tamil Nadu rep. By its Secretary to the Government, Revenue Department Fort St.George, Chennai 9. 3.Tamil Nadu Corporation for Development of Women Limited (MAHAM) Government of Tamil Nadu undertaking No.100, Anna Salai Guindy, Chennai 600 032 rep. By its Managing Director. 4.The District Collector District Collectorate Coimbatore 641 018. 5.The Member Secretary Coimbatore Local Planning Authority Corporation Commercial Complex Coimbatore 641 018. https://hcservices.ecourts.gov.in/hcservices/ 6.Jumhao's Joys Park Limited rep. By its Director P.V.Ravi No.36, K.P.N.Colony, First Street Tirupur 641 601. .. Respondents in both WPs. R6 impleaded asper order dated 04.01.2007 in WPMP.No.17272/06 Writ petitions filed under Article 226 of the Constitution of India praying for issuance of a Writ of Certiorarified Mandamus, (1) calling for the records of the first respondent in G.O. (2D).No.20, Social Welfare and Nutritious Meal Programme Department dated 20.04.2005 and communicated to petitioner's counsel on 27.04.2006 in WP.No.13440 of 2006 (2) in G.O.No.31 Social Welfare and Nutritious Meal Programme Department, dated 09.05.2005 and communicated to petitioner's counsel on 07.11.2006 and quash the same and consequently direct the respondents to permit the petitioner to proceed with the development of hotel project in terms of G.O.Ms.No.254 Social Welfare and Nutritious Meal Programme (Sw.V) dated 22.09.1994 with such approvals as may be required in law. For petitioners : Mr.P.R.Raman for Mr.C.Seethapathy in both the WPs. For respondents : Mr.S.Veeraraghavan Addl.Advocate General III assisted by Mr.I.Paranthaman,AGP and Mr.L.S.M.Hasan Fizal Government Advocate for R.1to5 in both the WPs. Mr.R.Muthukumarasamy,Sr.Counsel for Mr.S.Udayakumar for R.6 in both the WPs. COMMON ORDER The writ petitioner in these writ petitions is a Private Limited Company incorporated under the Indian Companies Act, 1956 and carrying on the business of establishing, running and managing Hotels, among others. The Government, by G.O.Ms.No.111 dated 29.04.1993, issued by the Social Welfare Department, has decided to establish a Recreational-cum-Educational Complex and Children World for the welfare of the youth to be set up at Coimbatore and directed the District Collector to identify the location. Ultimately, as per the report of the District Collector, the land measuring 25.19 acres at Vilankurichi Village was found suitable, since the same is nearer to National Highways. The second respondent, Revenue Department, under https://hcservices.ecourts.gov.in/hcservices/ whom the administration of lands would vest, issued G.O.Ms.No.900 dated 18.10.1993, for establishment of an Amusement Park in the said location by the Social Welfare Department, viz., the first respondent, since the same is for a public purpose. As the lands were originally acquired, the first respondent, Social Welfare Department was directed to enter upon the lands declaring that the lands could be transferred from Medical Department to Social Welfare Department. 2. It is the case of the petitioner that subsequently, the lands were transferred from one Government Department to another, viz., from Medical Department to Social Welfare Department. The third respondent, MAHAM is constituted by the Government to look after the welfare of Children and Women in the State of Tamil Nadu and being the Government Company, it is run by the Social Welfare Department. The Government has entrusted the task of setting up the Amusement Theme Park to the third respondent with the authority, and therefore, the lands were vested at the disposal of the third respondent with the consent of other Departments. After the techno-economic survey by the Social Welfare Department through experts, it was decided to have the Theme Park as an Amusement Complex with Shopping Arcade, Country Club and a Star Hotel. Since it requires enormous amount for developing the lands, etc., the third respondent sought permission from the Government to implement the project by way of joint venture or by leasing out the lands to private entrepreneurs on a profit sharing basis or on long lease/rental basis. Hence, proposals were invited by wide publication in the newspapers by the Government on 03.08.1994, by way of tender. 3. The petitioner has made an application for setting up a Star Hotel and the same was made on 29.08.1994 along with Earnest Money Deposit of Rs.2 lakhs. The third respondent has ultimately accepted the tender of the petitioner for leasing out the lands in question on long term lease for 33 years and accordingly, the Government has issued G.O.Ms.No.254 dated 22.09.1994 through the Social Welfare Department granting lease in respect of 5 acres of land for establishing a Star Hotel and according to the petitioner, the petitioner continues to remain qualified for enforcing the said project. 4. A registered lease deed was executed by the third respondent with the petitioner on 05.10.1994 and possession of the lands was handed over to the petitioner. The registration was done after obtaining permission from the concerned authorities, like Income-tax Department, etc., and it was expressly mentioned that the first respondent had acquired the lands by transfer on 06.07.1994 under a Government Order. By letter dated 28.10.1994, the first respondent has directed the District Collector, Coimbatore, to earmark the place leased out to the petitioner for setting up the Star Hotel and to another entrepreneur viz., M/s.Jenneys Residency Private Limited, to set up a Shopping Arcade and a Country Club. Accordingly, boundaries were marked and the lands were handed over to the petitioner after the registration of the lease deed. https://hcservices.ecourts.gov.in/hcservices/ 5. Two Public Interest Litigations in W.P.Nos.1152 of 1995 and 9695 of 1995 were filed. W.P.No.1152 of 1995 for direction to form the Annai Sandhya Theme Park, as per G.O.Ms.No.900 dated 16.10.1993, and not to use the land for any purpose other than the formation of Theme Park on the allegation that the Hotels, Shopping Complex, Country Club are not related to the Amusement Park. The other writ petition, viz., W.P.No.9695 of 1995, filed for quashing G.O.Ms.No.900 dated 16.10.1993, contending that the transfer of property from the Government Medical College, Coimbatore to the Social Welfare Department for establishing the Theme Park is illegal. After hearing all the parties, including the petitioner herein, by a common order dated 22.09.1995, the writ petitions were dismissed, upholding the lease granted in favour of the petitioner and others and also holding that G.O.Ms.No.900 dated 16.10.1993, transferring the land from the Medical Department to Social Welfare Department for formation of Theme Park is valid and the lease granted to the petitioner for the purpose of starting a Star Hotel is also permissible. The order of the Division Bench has become final. The petitioner has been paying rent regularly from 1994 onwards, till 1999. However, because of the pendency of various cases, the petitioner is unable to undertake the project. 6. The petitioner is still complying with the terms of lease by paying the lease amount continuously and the petitioner has made an application to the Local Planning Authority, Coimbatore on 20.11.1996, for approval of the building plan to put up a Five Star Hotel. That was rejected on 05.12.1996 on the basis that the lands could be used only for educational purposes and the hotel project cannot come within the said object. Therefore, the petitioner has filed an appeal to the Secretary, Town Planning, Coimbatore, and also to the Director of Town and Country Planning, Chennai, against the said order. The said authorities have received the representation/appeal, but so far they have not passed any orders. In the meantime, on 11.03.1998, the petitioner has received a notice from the first respondent, stating that the transfer of lands from the Medical Department to Social Welfare Department is non-est in law and the agreement entered between the petitioner and the third respondent is also not valid and the Government has decided to resume the lands allotted to the petitioner. 7. The petitioner has filed W.P.No.4404 of 1998, challenging the said show-cause notice, which was disposed of by this Court on 01.04.1998, directing the petitioner to file its objection to the Government and accordingly, the petitioner has filed its objection on 08.04.1998. According to the petitioner, pursuant to the decision of the Division Bench of this Court in dismissing the Public Interest Litigation cases (W.P.Nos.1152 and 9695 of 1995) and also on the basis of the lease granted in its favour, the petitioner has spent more than Rs.55 lakhs, including the payment of lease rent. It is the further case of the petitioner that the annual lease of Rs.7.63 lakhs has been received by the respondents as on 09.05.1996. The petitioner has also sent three more demand drafts on 23.06.1997, 13.10.1998 and 17.03.1999 https://hcservices.ecourts.gov.in/hcservices/ and having received the same, the Government has neither encashed them nor returned the same. 8. The first respondent issued further notice to the petitioner proposing to conduct enquiry based on the show cause notice issued earlier which forced the petitioner to approach this Court by filing W.P.No.19830 of 1998, forbearing the respondents from dispossessing the petitioner from the 5 acres of land as per the lease deed dated 05.10.1994. The said writ petition was disposed of on 12.12.1999, by directing the Government to give opportunity to the petitioner before passing any order on the show cause notice dated 11.03.1998 with respect to its power to cancel the agreement. As per the direction of the first respondent dated 26.03.2002, the petitioner made his representation on 05.04.2002, clearly stating that the petitioner is still interested in proceeding with the project for constructing a Five Star Hotel as per the original lease deed and hence, requested to reduce the lease rent and adjust the amount already paid against the future rent. Thereafter, there was no communication from the first respondent and the petitioner has also sent a reminder on 21.04.2004. 9. In the meantime, another lessee, viz., M/s.Jenneys Residency Private Limited, who was also allotted 5 acres under the same Scheme to put up a Shopping Complex and Country Club has moved this Court, challenging a similar show cause notice dated 11.03.1998, by filing W.P.No.5109 of 1998. The learned single Judge of this Court, by order dated 08.01.1999, quashed the show cause notice dated 11.03.1998, directing the authorities to grant planning permission; against which the State has preferred appeals in W.A.Nos.428 of 1999 and 582 of 1999 and by common judgement dated 18.09.2000, the Division Bench has dismissed the appeals filed by the State Government and consequently quashed the show cause notice dated 11.03.1998; directing the Planning authorities to grant permission to the said M/s.Jenneys Residency Private Limited and the said judgement has become final and as on today, the said M/s.Jenneys Residency Private Limited, is operating the Country Club in the said premises. The writ appeals were dismissed on the ground that the petitioner in that case, viz., M/s.Jenneys Residency Private Limited has acted upon the promise and incurred heavy expenditure. In the said proceedings, the present petitioner was not a party, however, the Division Bench in the said Judgement has also stated that "if, as it is stated in the letter dated 22.09.1996 by the Collector of Coimbatore, other two allotees have not taken any action pursuant to the acceptance of their tenders, the Government is free to take such action as it deems fit". According to the petitioner, the said direction is not binding, since the petitioner was not a party to that petition and petitioner herein as M/s.Jenneys Residency Private Limited are put on the same pedestal, because both of them have taken effective steps. 10. Further, in respect of M/s.Jenneys Residency Private Limited, they have put up construction and the petitioner is not able to do so due to the pendency of various cases. Further, the said https://hcservices.ecourts.gov.in/hcservices/ M/s.Jenneys Residency Private Limited has put up the said construction without waiting for planning permission, however the petitioner has waited for such permission. As stated above, the petitioner has given its representation and in the meantime, when the officials of the petitioner sensed that some local persons have proceeded to measure the land, the petitioner had to move the Civil Court, viz., District Munsif, Coimbatore by filing O.S.No.244 of 2006 for injunction, which was subsequently withdrawn, on ascertaining that the persons who measured the land were Government officials only and the petitioner's remedy lies somewhere else. Accordingly, the petitioner approached this Court by filing W.P.No.10786 of 2006 challenging the show cause notice dated 11.03.1998, based on the earlier judgement stated above. 11. The said writ petition was filed and moved on 19.04.2006. The counsel for respondents took notice and the matter was listed on 24.04.2006, to ascertain the status of the matter. The case was further adjourned at request of the learned counsel for the respondents to 26.04.2006 and on the basis of oral instructions received, the proceedings were concluded on 27.04.2006. 12. The learned Government Advocate has produced copy of G.O. (2D)No.20 dated 20.04.2005, which is impugned in W.P.No.13440 of 2006, by which the first respondent has cancelled the lease of the land and ordered refund of the lease rent. It was, recording the said fact, W.P.No.10786 of 2006, filed by the petitioner challenging the show cause notice dated 11.03.1998 was closed on 27.04.2006, with liberty to the petitioner to challenge the subsequent order dated 20.04.2005, which was produced before the Court. It was, thereafter, W.P.No.13440 of 2006 was filed challenging the said G.O.(2D)No.20 dated 20.04.2005, cancelling the lease without issuance of notice to the petitioner and this Court while entertaining the above said writ petition ordered interim stay of dispossession, which remains operative and in that factual position, the 6th respondent, M/s.Jumhao's Joys Park Limited has sought to implead itself as a party and filed a petition to vacate the stay in W.P.No.13440 of 2006. 13. According to the petitioner, the 6th respondent was also originally allotted about 10 acres of land in the year 1995 for the purpose of setting up of an Amusement Park as per G.O.Ms.No.3 dated 09.01.1995 by the first respondent. Two other persons were also allotted land of an extent of 5 acres each for the purpose of setting up of Shopping Arcade and Country Club and also a Star Hotel. According to the petitioner, it is only when the 6th respondent has filed impleading petition in W.P.No.13440 of 2006, for the first time, the petitioner came to know that the Government by G.O.Ms.No.31 dated 09.05.2005, which is impugned in W.P.No.46153 of 2006, has allotted 3.30 acres of land to the 6th respondent from and out of the 5 acres of land allotted to the petitioner under the lease granted by G.O.Ms.No.245 dated 22.09.1994. 14. Since the impugned G.O.No.31 dated 09.05.2005 was not served on the petitioner, the petitioner made a request on 23.09.2006, https://hcservices.ecourts.gov.in/hcservices/ for issuance of copy of the impugned Government Order and the same was served on the petitioner on 07.11.2006, based on which W.P.No.46153 of 2006, is filed. It is the case of the petitioner that G.O.(2D)No.20 dated 20.04.2005 impugned in W.P.No.13440 of 2006 as well as G.O.Ms.No.31 dated 09.05.2005 impugned in W.P.No.46153 of 2006, were never served on it. It is only in some other proceedings when the petitioner came to know about the Government Orders, the petitioner was constrained to file these writ petitions on various grounds, including that the impugned orders are illegal and that the impugned Government Order cancelling the lease granted to the petitioner for 33 years is violative of the principle of promissory estoppel. By passing the impugned order, the Government has shown bias in favour of the 6th respondent and that the impugned G.O.(2D)No.20 dated 20.05.2005 was passed illegally by terminating the lease and within a period of one month the other impugned G.O.Ms.No.31 dated 09.05.2005 came to be passed, allotting 3-1/2 acres of land to the 6th respondent in an illegal manner, apart from stating that the impugned Government Orders are violative of principles of natural justice. 15. The first respondent through its Deputy Secretary has filed the counter affidavit in both the writ petitions. While it is admitted that the first respondent under G.O.Ms.No.111 Social Welfare Department and Nutritious Meal Programme Department dated 29.04.1993, has issued orders for the establishment of Annai Sandhya Children World at Coimbatore and also by a subsequent G.O.Ms.No.900 Revenue Department dated 18.10.1993, the Social Welfare and Nutritious Meal Programme Department was permitted to enter upon the lands to an extent of 25.19 acres and thereafter, the third respondent, which is a Government Corporation was entrusted with the work of implementation of the Scheme and persons including the petitioner were chosen on the basis of tender for lease. It is the case of the first respondent that the transfer of land has never taken in favour of the first respondent, viz., Social Welfare Department and therefore, the Government decided to resume the land. It is admitted that this Court while allowing the writ petition in W.P.No.19830 of 1998 on 12.02.1999 has directed the Government to give opportunity to the petitioner before passing orders on the show cause notice dated 11.02.1998. 16. It is the case of the first respondent that the writ petitioner has decided not to run the business and therefore requested the Government for the refund of the expenditure that it has incurred under various heads, viz., 1.Lease amount :Rs.38.17 lakhs; 2.Building cost :Rs.13.24 lakhs; 3.Stamp duty :Rs. 3.24 lakhs; and 4.Inagural expenses :Rs.10.00 lakhs --------------- Total :Rs.64.65 lakhs. --------------- https://hcservices.ecourts.gov.in/hcservices/ Therefore, according to the first and second respondents, by letter dated 14.05.2004, the petitioner has requested the Government to refund the entire amount which shows that the petitioner is not interested in carrying on the business, for which the lease was granted to it. It was only after considering the same, the Government has passed G.O.(2D)No.20 dated 20.40.2005, cancelling the order issued in G.O.Ms.No.254 Social Welfare and Nutritious Meal Programme dated 22.09.1994, allotting 5 acres of land to the petitioner, apart from refund of Rs.15.26 lakhs that had already been encashed towards the lease rent by the third respondent, to the petitioner, besides returning 3 demand drafts for Rs.22.93 lakhs received towards lease rent and Rs.13.24 lakhs being part of the amount spent by the petitioner in respect of the Scheme. 17. According to respondents 1 and 2, the petitioner has not done anything in furtherance of the lease agreement and therefore, it has no right to claim to run the business. Further, the petitioner has not paid the lease amount regularly. As per the lease, the petitioner was in enjoyment of the property nearly for 12 years and it was only after the petitioner has expressed its willingness for amicable settlement, the amounts were directed to be settled to it, by return of 50% of the expenditure stated to have been incurred by the petitioner. It is the specific case of the first and second respondents that the impugned orders cancelling the lease as well as granting the property to the 6th respondent were made on the basis of the request of the petitioner only, since the petitioner wanted to have amicable settlement. It is also denied that the petitioner is equally situated as that of M/s.Jenneys Residency Private Limited on the basis that it has put up the construction as per the agreement. 18. It is the further case of the respondents that the property originally belonged to the Coimbatore Medical College and was transferred in the name of first respondent. The Medical College has requested the property back since the College objected to the formation of an I.T. Park in the property belonged to the Medical College and in those circumstances, the Managing Director of M/s.ELCOT has identified the property leased out to the petitioner as well as other 5 acres of land given to M/s.Jumhao's Entrepreneurs to be resumed and given back to the Coimbatore Medical College. Therefore, it is now proposed to resume the lease land of the petitioner, which has already been cancelled by the impugned Government Order in G.O. (2D).No.20 Social Welfare and Nutritious Meal Programme Department dated 20.04.2005 and the lease land of M/s.Jumhao's Joys, for construction of Dental College. 19. It is the further case of the respondents that even though by G.O.Ms.No.111 Social Welfare and Nutritious Meal Programme Department dated dated 29.04.1993, there was a proposal to establish Annai Sandhya Children World, actually the property which was selected for the said purpose belonged to the Medical College, Coimbatore and the concerned Department has never transferred the property in favour https://hcservices.ecourts.gov.in/hcservices/ of the Social Welfare Department at all and therefore, the property has never vested with the Social Welfare Department. In those circumstances, the Government has decided to resume the lands allotted in favour of other people including the petitioner. 20. It is the further case of the respondents that two demand drafts sent by the petitioner for the value of Rs.15.28 lakhs towards the lease from 05.10.1994 to 04.10.1996 have been returned to the petitioner. It is also their further case that the petitioner has not paid the lease amount up to date. If really the intention of the petitioner was to proceed with the project, they would have paid the rent as on date. As per the judgement in the writ petition filed by M/s.Jumhao's Joys Park, in W.P.No.7652 of 1999, the District Collector of Coimbatore has found that the 6th respondent was having only 6.70 acres out of 10 acres allotted, since the remaining 3.30 acres was utilised by the Coimbatore Corporation for public road and after finding that the land allotted to the petitioner can be given to the 6th respondent, in order to avoid any contempt proceedings relating to the judgement given in the case filed by M/s.Jumhao's Joys Park, the Government has cancelled the allotment of 5 acres of land to the petitioner and allotted a part of the said land to the 6th respondent. 21. It is also the case of the first respondent that as per the lease deed, the construction should be completed within 12 months but the petitioner has not completed the construction till date and the petitioner has also failed to pay the lease rent up to date, and it was only thereafter, due to inability the petitioner has expressed its desire to have the settlement. It is the case of the first respondent that allotment of 3.30 acres of land to the 6th respondent from and out of the property which has been leased out to the petitioner was only as per the direction of this Court. It is also the case of the first respondent that the property in possession of Coimbatore Medical College has been identified for the purpose of I.T.Park and when the College objected to the same and decided to take away the property, the petitioner had to give up its claim under the lease deed. 22. Mr.P.R.Raman, learned counsel appearing for the petitioner would submit that the impugned orders in these two cases have not been served on the petitioner and the petitioner came to know about the cancellation of lease, which was granted to it on 05.10.1994 for a period of 30 years, when it was revealed before the Court by the learned Government Pleader on 27.04.2007 in the writ petition filed by the petitioner in W.P.No.10786 of 2006, challenging the show cause notice issued by the first respondent dated 11.03.1998 and no orders were passed in spite of repeated representations. 23. It is his further contention that even the other impugned order, viz., G.O.Ms.No.31 dated 09.05.2005, by which the first respondent has taken away 3.30 acres of land which has been leased out, from the petitioner to the 6th respondent, which fact came to light only when the 6th respondent has filed an impleading petition in https://hcservices.ecourts.gov.in/hcservices/ W.P.No.13440 of 2006, filed by the