THE HON’BLE SRI JUSTICE V.V.S.RAO WRIT PETITION No.7468 of 2006 August 13, 2010 Between: M/s.Kayquinone Organics (India) Ltd., represented by its Director, Anil Kumar Agarwal, S/o.O.P.Agarwal … Petitioner And The Andhra Pradesh Industrial Infrastructure Corporation Ltd., Represented by its Chairman and Managing Director, Hyderabad And another ... Respondents THE HON’BLE SRI JUSTICE V.V.S.RAO WRIT PETITION No.7468 of 2006 ORDER: The Andhra Pradesh Industrial Infrastructure Corporation Limited (APIIC) developed Industrial Development Area at Pydi Bhimavaram in Srikakulam District, with an object of providing industry friendly facility and a fillip to socio-economic development of the State. In 1995, petitioner – which is a registered company – was allotted land admeasuring Acs.35.00 (plot Nos.1 to 60) for setting up of industry for manufacturing Dye Intermediate plant. By impugned order dated 22.3.2006, APIIC cancelled the allotment and made them liable for eviction while advising them to approach APIIC for refund of the amount. The petitioner was allotted the land vide allotment letter dated 05.1.1995, subsequently modified on 22.6.1995, at a cost of Rs.22,24,675/- on outright sale basis. Petitioner was asked to pay total cost Rs.57,59,691/- including developmental charges and EMD of Rs.1,25,000/-. The total amount was paid. APIIC agreed to execute agreement of sale and sale deed. After negotiations, the former also agreed to modify clause 18 of the agreement besides deleting other clauses which formed part of the draft agreement. On 13.9.1995, APIIC gave ‘No Objection Certificate’ for the petitioner to mortgage the land to the Industrial Finance Corporation of India (IFC) by depositing the title deed. In furtherance thereof, second respondent executed sale deed dated 09.1.1996 conveying the right, title and interest. All along the possession has been with the petitioner. It appears that there was some delay on the part of the financiers to release the funds and therefore the unit could not be grounded. Further, as alleged by petitioner, APIIC obtained copy of registered sale deed and sent it directly to IFCI and, therefore, they could not approach other financiers for necessary funds. The impugned order was passed on the ground that the unit was not established and that the land can be made available for any other entrepreneurs for industrial purpose. Therefore the impugned order purports to cancel the allotment consequent to agreement of sale dated 13.9.1995 and sale deed dated 09.1.1996. Though the writ petition was admitted on 17.4.2006 and the impugned order was suspended, APIIC has not filed counter affidavit. Therefore applying the principle of non-traverse the allegations with regard to justification for not commencing the unit remain uncontraverted. The Counsel for petitioner and Standing Counsel for APIIC made their submissions, when these cases were heard along with a batch of cases in W.P.No.7320 of 2006 and batch. In the judgment delivered on 16.7.2010 in the said batch, this Court overruled the objection of APIIC on the question of maintainability. The other aspects are also decided against APIIC. The conclusions and reasons therein are applicable to the facts and issues in these cases as well. It may be reiterated that when once APIIC executed sale deeds either in favour of original allottees or subsequent purchasers, who purchased the plots with the permission of APIIC (who have also accepted for change of ownership), the issue goes out of the realm of contract. Being a public authority, APIIC cannot act arbitrarily and cancel the allotment having the effect of nullifying the registered sale deed transferring the title. In the judgment delivered by this Court referred herein above, it was held as follows. There is no denial that the agreement entered into by APIIC and the petitioners in these cases, does not contain any clause in the above terms nor clause 7 in the registered sale deed can be construed as “condition super added”. This Court is not able to countenance the submission of the counsel that the phrase in clause 7 of the sale deed reading “ … … shall use the said plots for the aforesaid purpose of putting up factory or factories duly permitted by the competent Authority and for no other purpose” should be construed as “super added clause”. As held by this Court in K.Gopal Reddy v Secretary, M/s.Vijaya Coop. House Buildings Society[1], when once sale deed is registered by the seller in favour of buyer, contract is concluded and no party can enforce sale agreement covenants. Therefore, this Court holds that insofar as these cases are concerned, APIIC has no such power or jurisdiction to cancel the allotment, which has effect of nullifying the sale deed. The writ petition, for the above reasons, is allowed with costs. Advocate fee Rs.5,000/- (Rupees five thousand only). ________________ (V.V.S. RAO, J) August , 2010 YS [1] 2004 (2) ALT 538