t 5 i\ fj l i i 1 l [ 3377 ] HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD FRID rrlt AY HE TWENry NINTH DAY OF DECEMBER TWb THOUSAND AND TWENTY THREE fl l$ PRESENT I THE HO THE HO t N' BLE THE CHIEF JUSTICE ALOK ARADHE AND BLE SRIJUSTICE N.V.SHRAVAN KUMAR J#$ WRI PEAL NO.461 AND 462 OF 2OO8 Jffi Writ Appeal ,naer cfJuJelf 5 of the Letters Patent against the order dated 30-11- ll 2OO7 in W.P.No.7619 of 2006 on the file of the High Court. ,ifi$ 1l+ Between: jl , 1. B.Satish Kumar Gupta, (died per LRs Appellant Nos.2 to 4) 2. Smt Prabha Rani Gupta, Wo Late Sri Satish Kumar Gupta'Aged about 73 Years Occ: Housewife 3. Vinay KumarGupta, S/o Late Sri Satish Kumar Gupta Aged about 55 Years Occ: Business 1. ,9. 4. Sanjeev fumarlctipta, S/o Late Sri Satish Kumar Gupta Aged about 50 Years Occ: Business 'tr lErr All are Rl/o.Flafl'fffi.ro+, Mohini Mansion, H.No.1-2-18, Gaganmahal Road, Domalguda, HYderabad. Appellant Nos. 2 t8'4 are brought on record as LRs of deceased Appellant No. 1 'ds per Court Order dated 11.O4.2022 Vide l.A.No-1 ot 2022 in W.A.No.461 WRIT APPEAL N oF 2008 of 2008 AND 1 . Government of ...APPELLANTS/PETITIONERS rl. I AhOnra Pradesh, rep. by its Secretary, lndustries and i1 l[ ffii 2 3 Commerce Department, Secretariat, Hyderabad Commissioner ,lbilt tnAr"tri". and Competent Authority, Andhra Pradesh, Azamabad lnddstrial Area, Chirag Ali Lane Hyderabad Praja Shakti Slnhi S"..tf,a, rep. by its Authorised, Signatory, RTC Cross Roads, Hyderabad . *ff i, t Counsel for ttre ResJo,[a"n, tto.. 1 & 2: GP FOR TNDUSTRTES & COMMERCE Writ Appeal ,nd.r. "'lrff 15 of the Lefters patent fited against the order dated 30.11.2oo7in w.p.r.ro]zJro 7 of 2oolon the fite of the High Court. 4 r* Andhra ",.,o"lnIi"o Managing Directol, Pa Municipat corpf,,tf;on Bhavan, Tank Bur1d, H ustrial lnfrastructure Corporation Ltd., rep. by its rishram Bhavan, Basheerbagh, Hyderabad of Hyderabad, rep. by its Commissioner, B.R.K.R. yderabad ...RESPONDENTS/RESPONDE NTS 5 ,J Counsel for the Ap : SRI V. HARI HARAN counset ror tre nesJola counsel ro. tne nesfo,lal"f Counsel for the Res ent No.4: SRI K. V. SIMHADRI ent No.3: SRI N.S. ARJUN KUMAR SRI V. MALLIK ent No.5: M/s. KALPANA EKBOTE, S.C. FOR MUNICIPAL CORPORATION lT APPEAL NO: 462 OF 2008 ffi Between: l '1. B.Satish Kumal AND 1 $,i d[0" 2. 9mt.Prabha RaniirGupta, Wo Late Sri Satish Kumar Gupta, Aged about 73 Years Occ: Housewife 3. Vinay_Kumar Gupia, S/o Late Sri Satish Kumar Gupta Aged about 55 years Occ: Business i I 4. Sanje{"v Kumar Gupta, S/o Late Sri Satish Kumar Gupta Aged about 50 Years Occ: Business r i All are R/o. FlatrrNo.104, Mohini Mansion, H.No.1-2-lS,Gaganmahal Road Domalguda Hyderabad. Appellant Nos.2ld 4 are brought on record as LRs of deceased Appellant No. 1 as per Court Order dated'11.04.2022 Yide LA.No.1 of 2022 in \A/.A.No.462 (Died per LRs Appellant Nos. 2 to 4) of 2008 ...APPELLANTS/PETITIONERS The Govemme of Andhra Pradesh, rep. by its Secretary, lndustries & Commerce (lF C ) Department, Secretariat, Hyderabad 2. The CommissiJnJ. of lndustries and Competent Authority, Andhra Pradesh, Azamabad lndustrial Area, Chirag Ali Lane, Hyderabad rI I I tl ri t Counsel for the Appellants: SRI V. HARI HARAN I Counsel for the Resporident Nos. 1 & 2: GP FOR INDUSTRIES & COMMERCE r' ih;i Counsel for the ResfbJtdent No.e: SRI N.S. ARJUN KUMAR rhe court."o",n" ffffi* 3. Praja Shakti Sahiti Samstha, rep.by its Authorised Signatory, RTC Cross Roads, Hyderabad ...RESPONDENTS/RESPONDENTS SRIV. MALLIK ing: COMMON JUDGMENT :l lE;t 1t I 'i I i l tl: ; lEri iiiffi iiiB{ .I lF:F i, ffi.i IF i ir[t *r It II iI ii ir irll tit:tt l THE HON'BLE THE CHIEF JUSTICE ALOK ARADHE AND TIIE HON'BLE SRI JUSTICE N.V.SHRAVAN KUMAR Writ Appeal Nos.461 and,462 of2OOB coMMON JUDGMENT: 6'er rrre ao n'ble Sd JusticeN V Shtauan Kumar) These intra cotrt appeals are filed against the common order dated 13.ll.2OO7 in W P'No'25167 of 2OO5 and, 7619 of 2006. The said writ petitions were disposed of by common ordcr in view of commonality of the parties ald also subject matter as well. The petitioner in both the Writ petitions had filed the present writ appeals' Since' the petitioner / appellant died, his legal heirs were brought on record as appellant Nos.2 to 4 in both the writ appeals' The respondent Nos. I to 3 in W.A.No '462 of 2OO8 were shown as respondent Nos.1 to 3 in W.A.No 46 1 of 2OO8 and apart from these parties, A.P'Industrial Infrastructure Corporation Ltd., represented by its Managing Director was shown as respondent No.4 and the Municipal Corporation of Hyderabad, represented by its Commissioner was shown as respondent No.5 in W.A.No.46 1 of 2OO8' 2 2. W.p.No.25l67 of 2005 was filed questroning the action of respondent No. I contained in Memo No'14701/tF-.ELL/Ar/2005 dated 29.ro.2oos and the order of respondent No.2 in Lr.No.13/ t /2OO4l oo25/0025/FD ilated o1.or.2oo4 rejecting the ciaim of the petitioner for grant of leasehold / freehold rights over the industrial plot bearing No.21/ 1 by deeming that the petitioner has been in continuing lessee as on the date when the Azamabad Industrial Area (Termination and Regulation of Leases) Act, 7992 and the provisions of the amendment to the said acts and also to declare the cancellation of leasehold rights of the petitioner contained in the order of respondent No. 1 in G.o.Ms.No.225 dated 23.O3.1990 and arbitrarSz and illegal. 3. W.P.No.76 19 of 2006 was filed questioning the action of respondent in selling plot no.2l /1 of Azarnabad Industrial Area, Hyderabad to respondent No.3 under registered sale deed bearing Doc.No.3g04/2005 dated 23.11.2OO5 ignoring the legitimate claim of the petitioner for fresh lease of the industrial plot and to direct respondent No.2\to grant leasehold / freehold rights of the J said plot in favour of the appeliant / petitioner contemplated by the provisions of Azamabad Industrial Area (Termination and Regulation of Leases) Act, 1992' 4. In both the writ appeals, since the pleadings of the parties are common, these writ appeals are disposed of by a common order. 5. The brief facts of the case are that the father of the appellant / petitioner one S'Bhagatram Gupta, the Managing Director of M/s.S.B.Ram a-nd Company was an industrial concern manufacturing readymade garments and his father obtained leased out industrial plot bearing No.21/ 1 admeasuring Ac.1.137 gts, Hyderabad for a period of 99 years vide registered lease deed executed by Government of Andhra Pradesh on 24.03.1967 enabling establishment of manufacturing plant for readymade garments. Thereafter, the petitioner's father in pursuance to the said lease, has constructed factory building and installed machinery for readymade garments and the unit was continuously functional and carrying on manufacturing activity for fifteen (i5) years and thereaJter' -z 4 due to labour unrest, it became a sick unit. Thereafter, the line of activity was changed from dress manufacturing unit to Pharmaceutical and in such context, a partnership deed was entered oo 19Z6 under the name and style of M/s. Phoenix Pharmaceuticals and necessary permissions were a-[so taken. 6. Thereafter, due to some disputes amongst tfre members of M/s. phoenix pharmaceuticals which resulted in filing of O.S.No.39g of 1995 but the manufacturing activity continued upto I0.07.I99g a,d thereafter, the partners have left the partnership firm. It is further submitted that eversince grant of lease, there was always an industrial activity over the said industrial plot and it was never put to disuse by the father of the appellant / petitioner. Later, the petitioner father died in the year 1995 and the appellant / petitioner was associated with the manufacturing process. Thereafter, respondent No.1 issued memo dated 29.O7.19g7 proposing termination of lease orr the ground of sub-lease and non_user of industrial plot for which the petitioner / appellant filed detailed explanatiorr to the said memo and proceedings were dropped. 5 Thereafter, notice was issued by respondent No.1 on I2.O7.1989 suggesting termination of lease on the very same grounds and respondent No.l issued G.O.Ms.No.225 dated 23.03.1990 terminating lease hold rights in respect of said industrial plot. Thereafter, petitioner challenged the said G.O., dated 23.03.1990 by way of filing W.P.No.7025 of 1990 and this Court granted an interim order of slatus quo as regards possession on 25.05.1990 in the said writ petition. 7 . The petitioner has submitted a detailed representation dated 21 .O7.1993 to respondent No. I for restoration of lease which was executed in favour of his father, since the lease was heritable. The petitioner was made to understand that the Government itself may reconsider the issue and restore the leasehold rights in his favour and that on the said representation, respondent No. I issued memo dated 20.08.1993 forwarding the representation to respondent No.2 and directed him to obtain a fresh lease application. It is submitted that petitioner received a letter from respondent No 2 to withdraw W.P.No.7O25 of 1990, so that Government cal 6 take appropriate decision The petitioner in pursuance of that letter, the letter has withdrawn said writ petition relying upon dated 16.11.1993 issued by respondent No.2 wherein certain documents were required to be furnished for restoration of lease hold rights. 8. In G.O.Ms.No.225 dated 23.03.1990, it is submitted that the original lessee Mr.S.Bhagat Ram Gupta and his successors-in-interest of the said leasehold rights of the deceased lessee failed to run the unit of original line of manufacture "Ready-made dresses unit,, or revive it or start a new unit so far in the leasehold premises, inspite of several reminders and though ample opportunity was given to them all these years. It is further submitted that the entire land vr,as kept idle without any industrial activity, defeating the very purpose of individual use for which the land was leased out. 9. In view of the wilful breach of the covenants and violation of terms and conditions in respect of lease deed dated 24.03.2019 agreed upon in respect of the leasehold premises of plot No.21/ 1, admeasuring Ac. l _ 13T gts, the 1 Governor of Andhra Pradesh thereby terminated the leasehold rights in the said plot of Industrial Area, Azamabad. 10. The learned Judge has noted the letter dated 16. I 1. 1993 issued by Commissioner of Industries, Andhra Pradesh i.e., respondent No.2 to the petitioner wherein that certain particulars / documen ts were required for taking appropriate decision and requested to give undertaking to pay the arrears of the enhanced rate or quit rent. It was submitted by the petitioner before respondent No'2 that the industry would be commenced within a period of one (1) year from the date of re-delivery of possession of plot and that the petitioner has complied with all the requirements contained in the letter issued by respondent No.2 dated 16.11.1993 and also withdrawn the writ petition and paid the quit rent and submits that he had legitimate expectation that industrial plot will be restored to the petitioner as regards leasehold rights. 11. It was further submitted that in tLte year 1992, the State Legislature enacted Azamabad Industrial Area 8 (Termination and Regulation of Leases) Act, 1992 [for short 'the Act' hereinafterl by which the subsisting leases in Azamabad Industrial Estate were enmass terminated by operation of law and the uires of the said Act were unsuccessfully chalenged before this court and therefore matter was taken before the Honble Supreme Court wherein, respondent No.l represented before the Apex Court and stated that it is going to come up with certain amendments carrying considerable benefits to the erstwhiie lessees and on that promise the appeals in the Honble Supreme Court were closed. 12. Thereafter, the Act underwent amendment in the year 2000 by Amending Act No. ll2OOO and the amended provisions have enabled not only fresh grant of leasehold rights into freehold rights and arso conversion of freehold rights as per option of erstwhile lessees and thereaJter necessarJi applications under the amendment provisions of the Act was to be made as prescribed in the Rules. At the time of pending representation of the petitioner, the Act was promulgated and the representation of the petitioner was kept pending till the Amending Act 1/2000 has come 9 into force. Thereafter, the petitioner has submitted represenlation dated 12.08.2OO2 duly referring to his earlier representation and prayed for grant of leasehold rights over the industrial plots. Thereafter, petitioner has submitted another representation on 17 .O3.2OO4 in pursuant to the fresh notification dated 17 .O2.20O4 for grant of freehold rights. Respondent No.2 had rejected the petitioners claim vide order dated 08.O7 .2OO4 on the ground that there has been no industrial activity and that the lessee has failed to utilize the land either for starting any new unit or to revive the closed unit despite many opportunities given by the Government since then and the lessee remained as a non-user of the assigned plot since I 967. There was no industrial activity and the lessee remained as non-user as on the appointed date i.e., 17.O2.2OOO thereby attracting the provision of Section 3(1)(b) of the Act No.1/2000 1 3. The petitioner submits that since he was called upon to pay the quit rent as per the letter dated 16.11.1993 on the principle of promissory estoppel and legitimate expectation, the respondents ought to have l0 restored the leasehold rights to him in which event, he would have been a subsisting industrialist as on Ge date when the Act and the Amended Act had come into force. The petitioner would further submit that there was continuous industrial activity over the industrial plot from 1963 when the lease was executed in favour of his father. It is further submitted that respondent No.2 has taken a very hyper technical ground and imaginary ground to reject his claim and insofar there is absolutely no basis for such a finding and hence the cancellation of lease order contended in G.O.Ms.No.225 dated 23.O3.1990 is erroneous ald basele ss. 14. The main grievance of the petitioner is that respondents have deceitfully made him to withdraw the writ petition i.e., W.P.No.7205 of 1990 filed against the said cancellation and due to fraud played on him, he has withdrawn the writ petition. It is further submitted that as part of the same strates/, respondent No.2 had allotted industrial plot to respondent No.3 who is not entitled for such an allotment since he is not an industrialist. Further, the petitioner submits that respondent No.3 is a political lt organization and to accommodate them by allotment of his industrial plot is totaliy irrational and beyond any valid reason and if respondent No.3 is etigible for allotment of his industrial plot, it is absolutely ununderstandable as to how he is disentitled to the same. That apart, respondent No.3 has not complied with any of the provisions of the Act and amendments provisions of the Act and hence rejection of the claim to respondent No.3 is erroneous, discriminatory and arbitrary 15. Petitioner / appellant thereafter liled an appeal before respondent No.1 under Section 9 of the Act and his appeal was rejected vide Memo dated OB.1 1.2004, challenging the same, petitioner preferred a writ petition in W.P.No.21410 of 2004 and the said writ petition was partly allowed on 17.02.2005 setting aside summary rejection order and directed respondent No.1 to consider the grounds of appeal on their own merit afre sh and in pursuance to the said order, respondent No'1 has passed impugned memo dated 29.1O.2OO5. It is submitted that during the pendency of the writ petition, respondent No.4 had executed the sale deed in favour of respondent No.3 \ .a? r2 which is registered as Doc.No.3BO4 I2OOS alienating said plot in favour of respondent No.3 for a total consideration of Rs. 17 ,19 ,5OO I - which according to the petitioner is nothing but an undue favour conferred out of way in favour of respondent No.3, when all the other industrial plots in Azamabad Industrial Area were granted fresh lease/fresh hold in favour of the subsisting lessees an no sale deed is executed in respect of any other industrial plots in Azamabad Industrial Area. 16. The petitioner is questioning the action of respondents in permanentll, de priving his claim for grant of lease / freeholder rights over the subject plot, which is subject matter in W.p.No.25167 of 20O5 and thus, from any point of view, the action of selling industrial plot to respondent No.3 is arbitrary and illegal. The petitioner further submits that in the contractual matters, the action of State should be transparent and free from arbitrariness [2OO4(31SCC ss3]. 17. Thereafter, lcarned Judge after noting the contents of the counter filed by respondent Nos. l, 2 and 3 t3 observed that while disposing the application of the petitioner / appellant dated 17.03.2004, the Commissioner of Industries and competent authority opined as follows: "that the representation filed by Mr.B.Sathish Kumar Gupta of M/s.S.B.Ram and Company along with Application dated 17.03.2004 was examined and found that he had violated lease conditions ald the lease was carrcelled by Government uide G.O.Ms.No.225 dated 23.O3. 1990 and that the subsequent representation is only a statement of intention of starting of an industrial activity and that the earlier assurances were made difficult to believe that the petitioner would start any industrial activity and that M/s.S.B.Ram and Company was not doing any industrial activity and thus they fall within the provisions of Section 3(1)(b) and was ht for rejection. Accordingly, the application of M/s.S.B.Ram and Company for grant of leasehold rights was rejected uide offrce letter Lr.No.13/ | /2Oo4 /Oo2s lOo25lFD, dated 08.07 .2004." 18. It is further observed that rcjection of the grant of freehold rights were strictly in terms of Act No.1/20O0 and that when the appeal filed by the petitioner / a-ppellant has I4 been rejected, the Government has directed the Commissioner of Industries to handover the land to respondent No.4. Respondent No.2 after conducting panchanama has handed over plot admeasuring 34 14 sq.yds., in PIot No.21/1 to respondent No.4 on lg.ll.2OO4 as per G.O.Ms.No.97t8/IF Cdil/A1 /2OOa, dated 09.ll.2OO4, which was questioned by the petitioner by Itling W.P.No.25l67 of 2005. The learned Single Judge while considering the applicability and the provisions of the Act carefully taken note of the Act and observed that as seen from the letter dated 16.11.1993, though in W.P.No.7O25 of 1990 u,hich has been r.r,ithdrawn, relating to liberty or otherwise nothing has been specified and the learned Judge has come to a conclusion that only in the light of the compromise made, the writ petition had been withdrawn. The learned Judge has considered Section 4 of the Act cannot be invoked since the ingredients of Section 4 are not satisfied. l5 19. Learned Judge has referred to State of Orissa v, Mangalam Titnber Prod.ucts Limited t and the relevant paragraph is extracted hereunder: "Hauing heard the learned counsel for the parties, we are satisfied that no case ls made out for interference tuith the judgment of the High Court. Before the High Court, tlrc principal plea of the respondent u,tas that there u-)as no contract in uriting and therefore the applicabilitg of the pinciple of promissory estoppel was not established. The High Courl has rightly discarded this plea. To attract the applicabilitg of the pinciple of estoppel it is not necessaru that there must be a contract in writing entered into between the parties. We are ftot sotisfi.ed euen pima facie that it was a case of an error committed bg the State Gouernment of which it utas not aware. The State of Orissa should haue, uhtle holding out the representation, taken into consideration the factwho utill haue to do re- plantation and tfnt the permission of the Gouernment of India tuouLd be needed for the purpose. The State cannot take aduantage of its otun omission. The State Gouernment hauing persuaded the respondent to establish an industry and respondent hauing acted on the ' etn zooa sc zq{ 16 solemn promise of the state Gouernment, purchased the rauL material at a ftxed pice and also sold its products bg pricing the same taking into consideration the pice of raut mateial fixed by the State Gouernment and supplied, the State Gouernment cannot be permitted to reuise the term.s for supplg of raw material aduerselg to the interest of the respondent and effectiue from a back date and place the respondent in a situation which it will not be able to resolue. The respondent could not haue reuised their pice Jrom a back date and recouered it from innumerable consumers to uthom their finished products utere supplied at a frxed price." 20. In the case of Hira Tikkoo v. tlnion territory, Chand,igarh2, th,e I{on''ble Supreme Court observed at paragraph 25 as under: "25. Surelg, the doctrine of estoppeL cannot be applied against public authorities uthen their mistaken aduice or representation is found to be in breach of a Statute and therefore, against general public interest. The question, hou,teuer, is uthether tle parties or indiuiduals, uho had suffered because of the mistake and. negligence on the part of tlrc statutory public authoitie s, ' etn zooa sc 3oa8 t7 would haue anA remedA of redressal for the loss theg haue suffered. The 'rules of fairness' bg which euery public authority ts bound, requires them to compensate loss occasioned to piuate parties or citizens tuho were misled in acting on such mistaken or negligent aduice of the public Autlnritg. There are no allegations and material in these cases to come to a conclusioru that the action of the authorities was mala fide. It mag be Lreld to be careless or negligent. In some of the Dnglish cases, the uiew taken is that the public authoittes cannot be absolued of their liabilitg to prouide adequate monetary compensation to the parties u.tho are aduersely affected bg their errofteous decisions and actions. But in these cases, anA directions to the public authoities to pag monetary compensation or damages utould also indirectly harm general public interest. The public authortties are enttusted with public fund raised from public moneA. Tlrc funds are in trust uith them for utilisation in public interest and stictlg for the purposes of the Statute under which they are created wiLh specific statutory duties imposed on them. In such a situation when a partg or citizen has relied, to his detiment, on an erroneous representation made bg public authorities and suffered loss and where doctrine of 'estoppel' utill not be inuoked to his aid, l8 directing administratiue red.ressal tuould be a more appropriate remedg than pagment of monetary compensation for the loss caused. bg non- deliuery of the possession o/ the pLots and consequent delag caused in setting up industies bg the allottees." 21. Learned Judge had observed that this was a long drawn litigation and that the petitioner had been agitating for his rights knocking the doors of the Courts repeatedly. It may also be relevant to have a glalce at the order made in W.P.No.456t of 2OO2 d.ated, 19.OZ.2OO2; "The bnef facts of the case are that the father of the petitioner u)qs grated- lease of the land in Azamabad Industial area for a period of 99 gears in respect of Ac. 1 . 137 by tlrc Industries Department. Hou.teuer, the Gouernment of And-hra Pradesh issued G.O.Ms.No.225, Industies and_ Commerce (IF-Cell) Department dated. 23-3 l99O canceling ttle lease granted. on 24_3_ j gB7. Against the same, the petittoner filed Writ Petition. No.7O25 of 1990, but in the meanuhile the Gouernment enacted the act called. azamabacl industrial aree. (termination & regulation of leases) act bA utlttch all the leases in respect of Industrial area situated und.er Azamabad area sta.nd cancelled. Consequentlg, the petitioner uLas l9 asked to uLithdrau the Wnt Petition so as to consider his case for allotment of fresh lease under the Act. Thereafter, the petitioner had withdrawn the Wit Petition filed bg him and he made a representation to the authorities for the grant of fresh lease but so far no action has been taken and therefore, the petitioner seeks appropiate directions. The petitioner also brtngs to the notice of this Court the co mmunication serut bg the General