Case: M.I.Builders Pvt. Ltd Vs. Radhey Shyam Sahu &amp; Ors

1. These appeals are directed against the judgment dated August 23, 1994 of a Division Bench of the High Court of Judicature at Allahabad, (Lucknow Bench). By a common judgment in three writ petitions, High Court speaking through Shobha Dixit, J. held that the decision of the Lucknow Nagar Mahapalika (`Mahapalika for short), also now called Nagar Nigam or Corporation, permitting M.I. Builders Pvt. Ltd. (the appellant herein) to construct underground shopping complex in the Jhandewala Park (also known as Aminuddaula Park) situated at Aminabad Market, Lucknow, was illegal, arbitrary and unconstitutional. High Court set aside and quashed the relevant resolutions of the Mahapalika permitting such construction and also the agreement dated November 4, 1993 entered into between the Mahapalika and the appellant for the purpose. Writ of mandamus was issued to the Mahapalika to restore back the park in its original position within a period of three months from the date of the judgment and till that was done, to take adequate safety measures and to provide necessary safeguard and protection to the public, users of the park. High Court had noticed that the fact that the park was of historical importance was not denied by the Mahapalika and also the fact that perservance or maintenance of the park was necessary from the environmental angle and that the only reason advanced by the Mahapalika for construction of underground commercial complex was to ease the congestion in area. High Court, however, took judicial notice of the conditions prevailing at the Aminabad market. It said it was so crowded that it was brusting from all its seams. Construction of the underground shopping complex in question would only complicate the situation and that the present scheme would further congest the area. It said that the public purpose, which is alleged to be served by construction of the underground commercial complex, seemed totally illusory2. Aggrieved by the impugned judgment of the High Court, appellant has come to this Court, Mahapalika also felt aggrieved and filed appeals (Civil Appeal Nos. 9326-28 of 1994) but these appeals by the Mahapalika were subsequently allowed to be withdrawn by order dated February 6, 2997. There is controversy as to how the Mahapalika which had earlier justified its action later turned round and sought to withdraw the appeals. The order allowing withdrawal of the appeals by the Mahapalika is as under :-I.A. Nos. 20 to 12Civil Appeal Nos. 9326-28 of 1994Nagar Mahapalika - AppellantsVersusRadhey Shyam Sahu and others - RespondentsOrderTaken on board.The learned counsel for the appellant seeks leave to withdraw the appeals and states that Mr. S.V. Deshpande who appears for the other side has no objection to the withdrawal. The appeals will, therefore, stand disposed of as withdrawn with no order as to costs.Sd/_________________, CJINew DelhiFebruary 6, 1997Sd/_________________, J3. Mahapalika also cancelled the building plans. This action of the Mahapalika was subject matter of criticism by the appellant as to how a duly sanctioned plan could be revoked without any notice to the appellant. We may, at this stage, itself reproduce the relevant portion of the resolution dated August 6, 1996 of the Mahapalika for withdrawal of its appeals which is as under :-The Lucknow Bench of Honble High Court of Allahabad has declared the agreement dated 4.11.1993 executed between the Nagar Mahapalika, Lucknow and M.I. Builders, Karamat Market LUcknow in respect of construction of underground Palika Bazar and Multistoreyal parking on Jhandewala Park Aminabad, Lucknow as invalid and not in the public interest vide their judgment dated 23.8.1994The Honble High Court rendered the above said Judgment by accepting the writ petitions preferred by several elected sabhasad of the then Nagar Mahapalika and the citizensOn the directions of the then Nagar Pramukh Shri Akhilesh Das, who wanted to cause undue profit to M.I. Builders against the interest of Nagar Mahapalika now Nagar Nigam Lucknow, the citizens of Lucknow, the Nagar Nigam Lucknow filed Special Leave Petition No. 17223-25 of 1994 in the Honble Supreme Court against the Judgment of the Honble High CourtIt is proposed that in the interest of the citizen of Lucknow and the Lucknow Nagar Nigam and pending Special Leave Petition No. 17223-25 of 1994 in the Honble Supreme Court be withdrawn and the Nagar Nigam Lucknow be further directed to oppose the Special Leave Petition filed by M/s M.I. Builders in the Honble Supreme Court against the Judgment dated 23.8.1994 of Lucknow Bench of Honble High Court of AllahabadUnanimously decided that the aforesaid resolution be passed and accordingly the action may be taken.4. The letter revoking the sanctioned building plans is dated April 17, 1997 and is as under :-ToM/s M.I. Builders (P) Ltd.Karmat Market,Nishatganj, Lucknow.Vide this office letter No. 223/Sa.Sa.A./95 dated 23.1.1995 the building plans for construction of underground shopping and parking complex at Jhandewala Park, Ameenabad were sanctionedAfter taking legal advice by the Honble Nagar Pramukh from the standing counsel of the Nagar Nigam and Add. Advocate General the earlier sanctioned building plans has been revoked vide order dated 17.4.1997. As such these have no legal sanctityPlease be informed.Yours faithfully,- S.K. GuptaMukhya Nagar Adhikari17.4.1997Copy to :The Vice Chairman, Lucknow Development Authority, for information.Sd/S.K. GuptaMukhya Nagar Adhikari5. There were three writ petitions before the High Court and during the course of hearing of those petitions High Court had directed maintenance of status quo. At that time, it would appear only digging in some part of the park had been done and there was no construction. When the matter came before this Court, by order dated December 14, 1994 the Court passed the following order :-Exemption from filing official translation is allowedLiberty to add the omitted parties in the cause title.Leave granted.We have heard counsel on the question of grant of interim reliefPrinting dispensed withThe operation of the impugned order of the High Court is stayed on the following conditions :Taking all the facts and circumstances into consideration and having regard to the fact that it may not be possible for this Court to hear the appeal within a short time having regard to the pressure of work and pendency of old cases, we direct that the appellant shall be permitted to construct an under ground shopping complex by raising its own funds without collecting any additional funds from individual or concerns to whom the promise of allotment of shop is made.clarify the matter, we say that the funds can be raised from agencies other than those to whom the shops are ultimately allotted. It will be made clear to the agencies from whom the funds are raised that they will not entitled to allotment of shops. The appellant will maintain accounts and file an undertaking to the above effect in this Court within two weeks from today. In addition to undertaking will contain a statement to the effect that in the event the appeals fail the appellant will not raise questions as to equity or the ground or its having invested a huge amount and will be totally amenable to such directions and orders that this Court may make in regard to the maintenance or otherwise of the shopping complex. In other words, if the Court directs removal of the shopping complex in the event of failure of the appeals, the shopping complex will have to be removed at the appellants cost without claiming anything in return. The construction will be so carried out that the open space will remain available for the public and the entire complex will be so constructed that it will be an underground one except for the ingress and egress portions to the complex. The total area to be constructed on the surface of the plot shall not exceed 10% of the plot. Â3pÂ3  ÅSLP (C) Nos. 17223-25/94Exemption from filing official translation isve granted.Tag on with appeals arising from SLP (C) Nos. 16907-09 of 1994 in which interim orders have already been made.6. It is contended by the appellant that after the aforesaid interim order, it got necessary building plans sanctioned by the Mahapalika and started construction. Respondents, however, filed an application complaining that construction was in violation of the building plans and was also against the provisions of the U.P. Urban Planning and Development Act, 1973 (for short, the `Development Act).ascertain the nature of construction being carried out at that time this Court appointed a Local Commissioner. These applications were then disposed of by passing the following order -.A. Nos. 10-12The Commissioner, Mr. Justice Loombs, a retired Judge of the High Court of Allahabad, has pursuant to this Courts order, submitted his Report dated February 15, 1996. In paragraph 3 of the Report he identifies the points on which the Report was required and then proceeds to indicate the actual physical condition in regard to the construction of the market and states that the entire market is being constructed underground and not above the ground and that the total area on the surface of the market for the ingress and egress (with Chabutras) and light purposes etc. does not exceed 10 per cent of the plot and is about 9.74 per cent of the area in which the market is being constructed. He, however, notes that the level of the park at the periphery appears to be higher than the estimated average level of the original park by about 3.21 feet = 3 feet 2.5 inches as worked out on the basis of available old signs and that the same does not appear to be in any manner offensive and is of no consequence. He also points out that the park made on the market area is and will be available for the public in the form of park less the structures made on the surface, which as pointed out above; does not exceed the permissible limit of 10 per cent of the total plot area. He also states that the Chabutras constructed on the back of the structures will also be available to the public and may serve as benches in the park. In view of this Report which precisely indicates the actual physical condition existing on the date of the Report and the plan appended thereto which shows beyond any manner of doubt that the entire construction is underground, the total surface area does not exceed the permissible limit of 10 per cent and the raising of the height on the periphery is of no consequence because it does not in any manner affect the surface area. We, therefore, accept the Report of the learned Judge and see no merit in these I.As.7. The Court, however, did not go into other issues raised in the applications. By a subsequent order dated May 7, 1997 the Court stopped further construction.

Reasoning:
The builder as well as the Mahapalika filed their respective counter affidavits in the High Court opposing the writ petitions. No counter affidavit was filed either by the State or by LDA though they were parties in the writ petitions. Chief Executive Officer and the Mayor were impleaded by name as respondents in the writ petitions and allegations of mala fides and favourtism made against them but none of them choose to file any counter affidavit controverting those allegations. In the High Court a very strange scenario emerged and that was that though the stand of Mahapalika and LdA as spelled out from documents was at variation with each other, yet both were represented by one counsel. Builder was represented by the Advocate General of the State while State was represented by its standing counsel. Before us though Mahapalika earlier supported the builder as noted above and also filed appeals against the impugned judgment but subsequently it reversed its stand, withdraw its appeals and filed an affidavit supporting the impugned judgment of the High Court. The State Government and the LDA also filed their affidavits supporting the judgment of the High Court with full vigour though as seen earlier before the High Court they are just mute spectators. We may also note that in reply to the applications IA Nos. 10 and 11 in this Court the Mahapalika lent its support to the builder. This action of the Mahapalika changing its stand midstream was subjected to severe criticism by the appellant and it was stated that there was estoppel by deed in the case and Mahapalika could not go back on its earlier stand.This last submission we need not go into the question if cancellation of the sanctioned building plans by the Mahapalika was valid as that was not the issue before the High Court.. This Court, after examining the whole facts of the case and applying the parameters laid in Ramana Dayaram Shetty v. International Airport Authority of India, 1979(3) SCC 489 negatived all the pleas raised by the petitioners. Referring to its earlier decision in International Airport Authority of India case this Court had observed that there are two limitations imposed by law which structure and control the discretion of the Government in giving largess. The first is in regard to the terms on which largess may be granted and the other in regard to the persons who may be recipients of such largess. Then the Court said as under :-So far as the first limitation is concerned, it flows directly from the thesis that, unlike a private individual, the State cannot act as it pleases in the matter of giving largess. Though ordinarily a private individual would be guided by economic considerations of self-gain in any action taken by him, it is always open to him under the law to act contrary to his self-interest or to oblige another in entering into a contract or dealing with his property. But the government is not free to act as it likes in granting largess such as awarding a contract or selling or leasing out its property. Whatever be its activity, the government is still the government and is, subject to restraints inherent in its position in a democratic society. The constitutional power conferred on the government cannot be exercised by it arbitrarily or capriciously or in an unprincipled manner; it has to be exercised for the public good. Every activity of the government has a public element in it and it must therefore, he informed with reason and guided by public interest. Every action taken by the government must be in public interest; the government cannot act arbitrarily and without reason and if it does, its action would be liable to be invalidated. If the government awards a contract or leases out or otherwise deals with its property or grants any other largess, it would be liable to be tested for its validity on the touchstone of reasonableness and public interest and if it fails to satisfy either test, it would be unconstitutional and invalid.. The Court said that the State of J&K, in view of its policy of industrialization, was interested in the setting up of the factory by the second respondents, particularly since the second respondents had two factories for manufacture of resin, turpentine oil and other derivatives and they possessed large experience in the processing of resin and reprocessing of resin, turpentine oil and other derivatives. The Court considered the nature of the contract and observed that it was obvious that, in view of the policy of the State Government, no resin would be auctioned in the open market and in this situation, it would be totally irrelevant to import the concept of market price with reference to which the adequacy of the price charged by the State to the second respondents could be judged. If the State were simply selling resin, there could be no doubt that the State must endeavour to obtain the highest price subject, of course, to any other overriding considerations of public interest and in that event, its action in giving resin to a private individual at a lesser price would be arbitrary and contrary to public interest. But, where the State has, as a matter of policy, stopped selling resin to outsiders and decided to allot it only to industries set up within the State for the purpose of encouraging industrialization, there could be no scope for complaint that the State was giving resin at a lesser price than that which could be obtained in the open market. The yardstick of price in the open market would be wholly inept because in view of the State policy, there would be no question of any resin being sold in the open market37. After examining this judgment it is difficult to appreciate the argument of Mr. Sorabjee as to how the principles laid in this case can be applicable to the present case.. It is not necessary to examine the report of the Local Commissioner in detail except to note that :1. extent of work carried out is approximately 80% of the civil and structural work, about 30% of the finishing work and 20% of the services support work;2. it is a First Class permanent constructions;3. cost of construction of the work so far executed is approximately Rs. 3.52 crore and the cost of work still to be done is approximately 2.97 crore;4. dismantling of the construction so far made and restoration of the park would cost Rs. 98,10,181/- less Rs. 22,19,550/- salvage value;5. though there is a letter of approval of confirmation having been given, there are no sanctioned drawings (Chief Architect of the Mahapalika said that sanctioned drawings were missing from his files)6. Lucknow Development Authority (LDA) did not play any role in sanctioning the project except the Layout Plan. (Layout Plan was forwarded to the LDA by the Chief Architect of the Mahapalika who was also officiating as Chief Architect of LDA at that time. In other words, the approval of the Layout at the LDA level was recommended by the same person who forwarded it from the Mahapalika);7. Master Plan could not have envisaged the park as a site available for commercial exploitation, given the density and congestion of the surrounding area;8. structure as designed is safe from the structural engineering view point;9. air pollution levels of the park and the surrounding areas would go up by substantial amount as a result of underground shopping complex-cum-parking; and10. there is a lot of crowding during day hours (9.00 a.m. to 6.00 p.m.) leading to generally slow movement of traffic and occasional traffic hold ups. A high decibel level thanks to vehicles and moving people and vendors. A lot of solid waste collection at the end of the day and generally high level of pollution as a result.. By and large the Report of Prof. Narayanaswamy has found acceptance by all the parties.We, however, do not find merit in his submission as we find that the Local Commissioner has applied the same principles while arriving at the cost so far incurred and the cost to be incurred for completion of the project. We, therefore, accept the Report of the Local Commissioner in its entirety. But to what effect we shall presently see63. Jhandewala Park, the park in question, has been in existence for a great number of years. It is situated in the heart of Aminabad a bustling commercial-cum-residential locality in the city of Lucknow. The park is of historical importance. Because of the construction of underground shopping complex and parking it may still have the appearance of a park with grass grown and path laid but it has lost the ingredients of a park inasmuch as no plantation now can be grown. Trees cannot be planted and rather while making underground construction many trees have been out. Now it is more like a terrace park. Qualitatively it may still be a park but it is certainly a park of different nature. By construction of underground shopping complex irreversible changes have been made. It was submitted that the park was acquired by the State Government in the year 1913 and was given to the Mahapalika for its management. This has not been controverted. Under Section 114 of the Act it is the obligatory duty of the Mahapalika to maintain public places, parks and plant trees. By allowing underground construction Mahapalika has deprived itself of its obligatory duties to maintain the park which cannot be permitted. But then one of the obligatory functions of the Mahapalika under Section 114 is also to construct and maintain parking lots.that extent some area of the park could be used for the purpose of constructing underground parking lot. But that can only be done after proper study has been made of the locality, including density of the population living in the area, the floating population and other certain relevant considerations. This study was never done. Mahapalika is the trustee for the proper management of the park. When true nature of the park, as it existed, is destroyed it would be violative of the doctrine of public trust as expounded by this Court in Span Resort Case (1997(1) SCC 388). Public Trust doctrine is part of India law. In that case the respondent who had constructed a motel located at the bank of river Beas interfered with the natural flow of the river. This Court said that the issue presented in that case illustrated the classic struggle between those members of the public who would preserve our rivers, forests, parks and open lands in their pristine purity and those charged with administrative responsibilities who, under the pressures of the changing needs of an increasingly complex society, find it necessary to encroach to some extent upon open lands heretofore considered inviolate to change.66. If we refer to the provisions of law relating to notice of meetings and business of the Mahapalika and its committees it is apparent that these provisions were not adhered to. There is no authority with the Mahapalika to constitute High Power Committee and to delegate its functions to that High Power Committee. There was no agenda at any time in any of the meetings of the Mahapalika for consideration of the underground shopping complex. There were no proposals, no documents, no plan, no study, no project report or feasibility report on the basis of which Mahapalika could have given a green signal for construction of the underground shopping complex. There was no discussion and no informed decision. Mahapalika completely abdicated its functions. Mahapalika delegated its functions to the High Power Committee in contravention of the Act. Constitution of the High Power Committee itself was wholly illegal. High Power Committee took decision to hand over the park to the builder for construction of the underground shopping complex and also approved the terms of the agreement dated November 4, 1993. Decision of the High Power Committee was put before the Executive Committee and the general body of the Mahapalika for the purpose of information ~ and both there was no agenda for consideration of these resolutions of the Executive Committee of the Mahapalika. Corporators had no time to apply their minds. Such an important matter, where the cost of the project was likely to run in crores of rupees, could not have been considered under the topic other subjects, subject to the permission of the Presiding officer. Section 105 of the Act protects any act done or proceeding taken on account of any defect or irregularity in procedure not affecting the substance. In the present case it is not mere irregularity or defect in the procedure but the whole procedure is in clear breach of Sections 91 and 119 of the Act which are mandatory67. The law mandates that not only the notice of the date and the time of the meeting but the notice of the business to be transacted at such meeting should be given at least 4 clear days before the date of the meeting for the Mahapalika and 3 days for the Executive Committee. When the agenda did not include the subject of construction of underground shopping complex nor was there any material to support the discussion the subject of construction of underground shopping complex it could not have been considered in the meetings of the Mahapalika and the Executive Committee.68. In Myurdwaj Cooperative Group Housing Society Ltd. v. Presiding Officer, Delhi Cooperative Tribunal and Ors. [1999(6) SCC 39), the appellant was a Housing Co-operative Society registered under the Delhi Co-operative Societies Act, 1972 and Delhi Co-operative Societies Rules, 1973. In the meeting of the general body of the society, it was decided that only those who have deposited minimum amount specified by the general meeting would be allotted flats and others would be accommodated on the flats to be constructed on the additional land in Phrase-II construction. Respondent No. 3 who was one of the original members of the society challenged the decision of the general meeting. One of the contention raised was that decision of the general body which relegated her and other such members to Phrase-II was not on the agenda. This Court said a general body can always with the approval of the house in the meeting of its members take up any other matter not covered by the agenda on that account, no illegality could be held. This Court also observed that Section 28 of the Delhi Co-operative Societies Act, 1972 vests final authority in the general body of a cooperative society. It has wide powers including residuary power except those not delegated to any other authority under the Act, the rules and its bye-laws. In other words, its power, if any, is only restricted by the Act, the rules, the bye-laws and any order having force of law. This decision is of no help to the appellant as in the present case we are considering the statutory provisions for holding of the meetings of the Mahapalika and the Executive Committee which have been violated69. Agreement dated November 4, 1993 has not been executed as required under Section 133 of the Act. Resolution of the High Power Committee, which was placed before the Mahapalika and the Executive Committee for information, required that ~ the prescribed project may be got executed by M.I. Builders Pvt. Ltd. and theshould be authorised for conducting all the forthcoming actions and formalities. Now, Mahapalika has power to enter into contracts (Sec. 131). Under sub-section (1) of Section 132 contract shall be expressed to be made, for and on behalf of Mahapalika and shall be so executed for and on behalf of the Mahapalika. Under sub-section (4), no contract involving an expenditure exceeding five lakh rupees shall be made by(Chief Executive Officer) unless it has been sanctioned by the Mahapalika. Proviso (a) to Section 133(1) requires common seal of the Mahapalika to be affixed on every contract. The common seal shall be affixed only in the presence of a corporator (Sabhasad) who shall attach his signatures to the contract in token that the same was sealed in his presence. The signatures of the corporator shall be distinct from the signature of any witness to the execution of such contract (sub-sections 2 and 3 of Section 133). Under sub-section 4 of Section 133 no contract executed otherwise than as provided in the section shall be binding on the Mahapalika. The impugned agreement is thus not executed in accordance with the requirements of law. Further, under sub-section (2) of Section 136 where the Mahapalika approves the project and the entire estimated cost exceeds rupees ten lakhs, the project report shall be submitted to the State Government and it is for the State Government to reject or sanction the project with or without modifications. Till that is done no work shall be commenced. No such sanction of the State Government was obtained in the present case. It was submitted that this provision would apply only if the project cost was to be incurred by the Mahapalika. We do not think it is so. It is the cost of the project that matters and not who incurs the cost in the first instance. Agreement dated November 4, 1993 is, therefore, not a valid contract and not binding on the Mahapalika. As held in H.S. Rikhys case (AIR 1962 SC 554 ) where a statute makes a specific provisions manner and in no other, that provision of law being mandatory and not directory has to be strictly followed. This principle will apply both as regards holding of meeting of the Mahapalika and execution of contract on its behalf. This judgment is also authority for the preposition that there is no estoppel against a statute70. We may now examine some of the terms of the agreement dated November 4, 1993. There are six recitals to the agreements which cannot be co-related to any discussion in any of the meetings of the Mahapalika, the Executive Committee or the High Power Committee. Under clause (2) of the agreement it is for the builder to make construction at its own cost and then to realise the cost with profit not exceeding more than 10% of the investment in respect of each shop. Nobody knows how much cost the builder is likely to incur and how long it will continue to be in possession of the shopping complex. Full freedom has been given to the builder to lease out the shops as per its own terms and conditions to persons of its choice on behalf of the Mahapalika and Mahapalika shall be bound by these terms and conditions. Builder has also been given the right to sign the agreement on behalf of the Mahapalika on the terms and conditions which the builder may deem fit and proper. Builder is only required to give a copy of the agreement to the Mahapalika after its execution and both the Mahapalika and the builder shall remain bound by the terms of that agreement. Since there is no project report nobody knows how many shops the builder would construct and of what sizes. Mahapalika is allowed to charge Rs. 5,000/- per shop for every second and subsequent transfer of shops by the builder but what amount is to be charged for the first transfer or subsequent transfers is left to the sole discretion of the builder. A bare glance at the terms of agreement shows that not only that the clauses of the agreement are unreasonable for the Mahapalika but they are atrocious. No person of ordinary prudence shall even enter into such an agreement. A trustee, which the Mahapalika is, has to be more cautious in dealing with its properties. Valuable land in the heart of commercial area has been handed on a platter to the builder for it to exploit and to make run away profits. As a matter of fact on examining the terms of the agreement we find that Mahapalika has been completely ousted from the underground shopping complex for an indefinite period. It has completely abdicated its functionsrepeat, the agreement is completely one sided favoring the builder. The land of immense value has been handed over to it to construct underground shopping complex in violation of the public trust doctrine and the Master Plan for the city of Lucknow. Mahapalika has no right to step in even if there is any violation by the builder of the terms of the agreement or otherwise. Mahapalika, though considered to be the owner of the land, is completely ousted and divested of the land for a period which is not definite and which depends wholly on the discretion of the builder.When we keep in view the principles laid by this Court in its various judgments and which we have noticed above, it has to be held that the agreement dated November 4, 1993 is not a valid one. The agreement defies logic. It is outrageous. It crosses all limits of rationally. Mahapalika has certainly acted in fatuous manner in entering into such an agreement. It is a case where the High Court rightly interfered in exercise of its powers of judicial review keeping in view the principles laid by this Court in Tata Cellular v. Union of India 1994(6) SCC 651. Every decision of the authority except the judicial decision is amenable to judicial review and reviewability of such a decision cannot now be questioned. However, a judicial review is permissible if the impugned action is against law or in violation of the prescribed procedure or is unreasonable, irrational or mala fide. On the principle of good governance reference was made to a decision of Division Bench of Bombay High Court in State of Bombay v. Laxmidas Ranchhoddas and another (AIR 1952 Bombay 468 at 475) (Para 12). It was submitted that bad governance sets a bad example. That is what exactly happened in the present case.It cannot be said that the construction of the underground shopping complex is by the builder as an agent of the Mahapalika. Concept of agency is totally missing in the present case. Rather the deal is from principal to principal. Reference may be made to the decision of this Court in Akadasi Padhans case [1963 Supp. (2) SCR 691] quoted above. When the development is by the builder provisions of Section 14 of the Development Act would apply. There is no sanction of the building plan of the underground shopping complex by the LDA. Construction is, therefore, per se illegal. Even after the interim order of this Court allowing construction, plans were not got sanctioned from the LDA, which would be authority under the Development Act. Sanction of the building plan by the Mahapalika would, therefore, be meaningless. Even then, there were no sanctioned drawings. It has been pointed out that process of sanction appeared to be ad hoc and skeletal. When construction started LDA issued a show cause notice to the Mahapalika but then in view of the interim order made by this Court show cause notice was subsequently withdrawn. It was stated that against the order withdrawing the show cause a revision was filed by Mr. Amrit Puri, a writ petitioner to the State Government, which was stated to be still pending.75. It is not disputed that there is a Master Plan applicable to city of Lucknow. This Master Plan prepared under the Development Act. It was submitted by the builder that the park could be exploited for commercial purposes as Aminabad has been shown to be a commercial area. No doubt Aminabad is a commercial area but that does not mean that the park can be utilised for commercial purposes. Rather using the park for commercial purposes would be against6 the Master Plan.How this letter came to be written one may notice the sequence. High Power Committee meets on October 13, 1993 and is adjourned to October 19, 1993. Mr. G.C. Goyal is the Architect of Mahapalika and he forwarded the layout plan to LDA. Mr. Goyal is also officiating as Architect of LDA. Approval of the layout plan by LDA is dated October 16, 1993, which is 3 days before the next meet of the High Power Committee. This approval of the layout at LDA was recommended by the same person who forwarded it from the Mahapalika and in a great hurry. In the Master Plan for the city of Lucknow, it is Aminabad area which is commercial and that would not mean that Park can be put to commercial use. By letter dated November 23, 1993, LDA objected to the construction being undertaken in the Park without obtaining permission/No objection from it and required the construction to stop. Mahapalika in turn by its letter sent on the following day to the builder informed it of the objection raised by LDA and that before starting any construction the permission/No objection of LDA as required under Sections 14 and 15 of the Development Act was necessary. It does appear to us that the Master Plan of the city of Lucknow could not have envisaged the Jhandhewala Park as a site available for commercial exploitation considering the density and congestion in the area77. The reason for t he construction of underground shopping complex given was that it would remove the congestion in the area. We have report of the Local Commissioner, which says that it would rather lead to more congestion. We think Mr. Dave is right in his submission that a decision to construct underground shopping complex by M.I. Builders had already been taken and that the whole process was gone into to confer undue benefit to M.I. Builders and the bogie of congestion was introduced to justify the action of the Mahapalika. It is wholly illegal and smacks of arbitrariness, unreasonable and irrationality.79. Action of the Mahapalika in agreeing to the construction of underground shopping complex in contravention of the provisions of the Act and then entering into a agreement with the builder against settled norms was wholly illegal and has been held to be so by the High Court. No doubt Mahapalika is a continuing body and it will be estopped from changing its stand in the given case. But when Mahapalika finds that its action was contrary to the provisions of law by which it was constituted there could certainly be no impediment in its way to change its stand. There cannot be any estoppel operating against the Mahapalika. Principles laid in Union of India v. M/s. Indo-Afgan Agencies Ltd. 1968(2) SCR 366 and of Calcutta High Court in The Ganges Manufacturing Co. v. Sourujmull and others 1880 ILR Calcutta 669 cannot apply to the facts of the present case.80. Section 128 of the Act confers powers on the Mahapalika to sell, let of, hire, lease, exchange, mortgage, grant otherwise dispose of any property or any interest therein acquired by or vested in the Mahapalika. Appellant and the interveners said that there was no disposal of any property and no interest in the land had been transferred by the Mahapalika to the builder. Respondent, as noted above, contended to the contrary. Union Section 54 of the Transfer of Property Act, 1882 agreement to sell does not create any interest in land. We are not concerned with this provision. Reference may, however, be made to Sections 60(b) and 62(f) of the Easement Act, 1882. Though the licence under Section 60(b) is irrevocable but it can be revoked after the happening of certain event which is when the builder has recovered whole of his investment plus 10% of the profit.We find force inthe submissions of respondents that by granting license to the builder to construct underground shopping complex of permanent nature and to hold on the same for a period which is not definite and then under the impugned agreement builder having been authorised to lease out the shops on behalf of the Mahapalika, it is a dubious method adopted as well in the case of lease and thus the transaction will also be covered by the expression otherwise dispose of any interest in the property.It is, therefore, difficult to accept the argument of the builder that transaction is outside Section 128 of the Act. Now, first license has been granted to the builder to enter upon the park and to execute a work of permanent character and incur expenses in the execution of the work, thus making the license irrevocable. However, the license is deemed to be revoked after the licensee has recovered his full cost on the construction plus 10% of the profit on the investment made by him. When this purpose is achieved by the licensee is anybodys guess. Not only that licensee, i.e., the builder is then authorised to lease out the shops so constructed on behalf of the Mahapalika. The result would be that to the builder provisions of Section 129 of the Act, cannot be thus made applicable. In such a situation for the builder to contend that the transaction is not covered by covered by Section 128 and, therefore, Section 129 will not apply is certainly incredulous. Provisions of Section 129 of the Act has, therefore, been flouted. Impugned agreement dated November 4, 1993 is bad having been executed also in contravention of the requirement of Section 129 of the Act.82. The facts and circumstances when examined point to only one conclusion that the purpose of constructing the underground shopping complex was a mere pretext and the dominant purpose was to favour the M.I. Builders to earn huge profits. In depriving the citizens of Lucknow of their amenity of an old historical park in the congested area on the spacious plea of decongesting the area Mahapalika and its officers forgot their duty towards the citizens and acted in a most brazen manner83. Proposition of construction of underground shopping complex was so lucrative and the land so valuable that Mahapalika itself could have done it by collecting earnest money from the prospective allottees. But then nobody cared to examine this aspect and a plea was also advanced that Mahapalika had no finance to undertake the project. If one refers to the agreement the builder itself devised a self-financing scheme and it had not to spend anything from its own pocket. On mere booking of the shops builder could collect rupees one crore twenty five lakhs and would have collected more money with the progress of the construction at various stages. A public body would not sequester away its property by devising new methods84. Thus there are two distinct areas of challenge in the present case - (1) the agreement is fraud on power, prime land has been given for a song by the Mahapalika. The fact that the scheme is so lucrative could be seen from the fat that all shops less 5% were booked within six days of the advertisement appearing in December, 1993. Public interest and public exchequer have been sacrificed. Mahapalika is divested of its control over the project though notionally not for ever but the builder, on the other hand, has control over the project for all times to come and (2) construction is in contravention of the provisions of law as contained in Development Act. The project has been entrusted to the builder in violation of the provisions of the Act. The decision taken by the Mahapalika was not on proper consideration and was not an informed objective decision. Judicial review is permissible if the impugned action is against law or in violation of the prescribed procedure or is unreasonable, irrational or mala fide. As said earlier High Court rightly exercised its power of judicial review in the present case. It has examined the manner in which the decision was made by the Mahapalika. Second principle laid in Tata Cellulars case [1994(6) SCC 631] applies in all respects. High Court held that the maintenance of the park because of its historical importance and environmental necessity was in itself a public purpose and, therefore, the construction of an underground market in the garb of decongesting the area was wholly contrary and prejudicial to the public purpose. By allowing the construction Mahapalika had deprived its residents as also others of the quality of life to which they were entitled to under the arbitrariness, unfairness and favoritism. The agreement was opposed to public policy. It was not in public interest. Whole process of law was subverted to benefit the builder. We agree with the findings and conclusions of the High Court.85. High Court in its impugned judgment has not doubted the capacity of M.I. Builders to undertake the project but then that is not the issue.Public interest has certainly been given a go bye. There was some undercurrent flowing to award the contract to M.I. Builders. High Court said lest we are taken amiss we wish to make it clear that we do not doubt either the bona fides of the authorities or the competence of the respondents M/s. M.I. Builders to enter into the impugned agreement but we are of the view...... The competence of M/s. M.I. Builders to undertake the project is not doubted when now it is seen that proper construction has been made but before taking decision to award the contract to it nobody knew its credentials. No attempt made whatsoever to consider if there was any other person more competent for the job or if of equal competence could offer better terms. In these circumstances, dictum contained in the case of Kasturi Lal Lakshmi Reddy v. State of J&K, 1980(4) SCC 1 becomes inapplicable. No advantage can be drawn by the builder from the decision of this Court in G.B. Mahajans case [1991(3) SCC 91] as here the whole process of awarding contract to M.I. Builders has been gone through in an unabashed manner and in flagrant violation of law with the sole purpose of conferring benefit on it.86. All said and done we fail to understood the certificate given by the High Court about the bona fides of the authorities in awarding the contract to M/s. Builders. The officers of the Mahapalika, who were impleaded as respondents by name, did not file any replies to contradict the allegations made against them. Rather it appears that it was a fit case where High Court should have directed an inquiry to be made as to how the project came to be awarded to M.I. Builders including the conduct of the lawyers87. High Court has directed dismantling of the whole project and for restoration of the park to its original condition. This Court in numerous decisions has held that no consideration should be shown to the builders or any other person where construction is unauthorised. This data is now almost bordering rule of law. Stress was laid by the appellant and the prospective allottees of the shops to exercise judicial discretion in moulding the relief. Such discretion cannot be exercised which encourages illegality or perpetuates an illegality. Unauthorised construction, if it is illegal and cannot be compounded, has to be demolished. There is no way out. Judicial discretion cannot be guided by expediency. Courts are not free from statutory fetters. Justice is to be rendered in accordance with law. Judges are not entitled to exercise discretion wearing robes of judicial discretion and pass orders based solely on their personal predilections and peculiar dispositions. Judicial discretion wherever it is required to be exercised has to be in accordance with law and set legal principles. As will be seen in moulding the relief in the present case and allowing one of the blocks meant for parking to stand we have been guided by the obligatory duties of the Mahapalika to construct and maintain parking lots88. In the present case we find that the builder got an interim order from this Court and on the strength of that order got sanction of the plan from the Mahapalika and no objection from the LDA. It has no doubt invested considerable amount on the construction which is 80% complete and by any standard is a first class construction. Why should the builder take such a risk when the interim order was specific that the builder will make construction at its own risk and will not claim make construction at its own risk and will not claim any equity if the decision in the appeal goes against it ? When the interim order was made by this Court Mahapalika and the State Government were favoring the builder. As a matter of fact Mahapalika itself filed appeals against the impugned judgment of the High Court. Perhaps that gave hope to the builder to go ahead with the construction and to take the risk of getting the construction demolished and restoring the park to its original condition at its own cost. The builder did not foresee the change in stand not only of the Mahapalika but also of the State Government. It also, as it would appear, over-rated its capacity to manage with the State Government to change the land use of the park. Builder is not an innocent player in this murky deal when it was able to get the resolutions of the Mahapalika in its favour and the impugned agreement executed. Now, construction of shops will bring in more congestion and with that the area will get more polluted. Any commercial activity now in this unauthorised construction will put additional burden on the locality. Primary concern of the Court is to eliminate the negative impact the underground shopping complex will have on environment conditions in the area and the congestion that will aggravate on account of increased traffic and people visiting the complex. There is no alternative to this except to dismantle the whole structure and restore the park to its original condition leaving a portion constructed for parking. We are aware that it may not be possible to restore the park fully to its original condition as many trees have been chopped off and it will take years for the trees now to be planted to grow. But beginning has to be made89. There are four blocks under construction. Services like air-conditioning, fire-fighting, water supply, sanitary installation, necessary pumps for drainage and sewerage, etc. are yet to be installed and completed90. In block No. 1 there are shops at the level minus 96. These shops are divided by partition walls. There is a big hall with pillars below these shops at level of minus 19691. In block 2 there are shops on the upper basement level 96. There is no lower basement level92. Third block is currently designed to have shops at the upper basement level and parking at the lower basement level. The upper basement level can be converted to have parking at that level too since the structural configuration will permit the same. Flooring on the lower basement is yet to be laid. There can thus be parking both on the upper basement and the lower basement. This parking place for vehicles would lead to decongestion of the roads surrounding the park which are otherwise choked with the parked vehicles in its entire periphery93. Fourth block is only partially developed with just a separate ramp going down to the first basement level and a few columns with their foundations standing from the lower basement level. This fourth block, is currently dug up. However, to facilitate the movement of the vehicles to the two levels of parking in the third block a new ramp shall be constructed adjacent to and contiguous to the third block94. We have noted above that under clause (ix-a) of Section 114 of the Act, it is incumbent on the Mahapalika to make reasonable and adequate provision by any means or measures which it is lawfully competent to it to use or to take for the construction and maintenance of parking lots, bus stops and public convenience95. Number of cases coming to this Court pointing to unauthorised constructions taking place at many places in the country by builders in connivance with the Corporation/Municipal officials. In the series of cases, this Court has directed demolition of unauthorised constructions. This does not appear to have any salutary effect in cases of unauthorised construction coming to this Court. While directing demolition of unauthorised construction, court should also direct inquiry as to how the unauthorised construction came about and to bring the offenders to book. It is not enough to direct demolition of unauthorised construction, where there is clear defiance of law. In the present case, but for the observation of the High Court, we would certainly have directed an inquiry to be made as to how the project was conceived and how the agreement dated November 4, 1993 came to be executed.