Case: M.D., H.S.I.D.C. &amp; Others Vs. M/s. Hari Om Enterprises &amp; Another

Corporation is a public sector undertaking. Its principal function is allotment of industrial plots belonging to the State of Haryana. It was set up as a catalyst for promoting economic growth and accelerating the pace of industrialization. It not only provides financial assistance to the industrial concerns by way of term loans; it also develops infrastructure for setting up of industrial units. The Corporation also invests money in developing the industrial estates at strategic locations. In exercise of its functions, it also allots industrial plots to entrepreneurs for setting up their industries on "no profit no loss" basis. The entrepreneurs, according to the Corporation, must be the deserving ones. For the said purpose, it keeps in mind the principle that allotment of land should not be made to speculators who invest in property for getting high returns on escalation ofNo. 1 is a partnership firm. It was previously known as M/s. Dysa International (Firm). It applied for allotment of 1000 sq. m. size plot in IMT, Manesar. The Allotment Committee of the Corporation having found the respondent to be eligible for allotment, allotted plot No. 177 in Sector 6, IMT, Manesar measuring 1012.50 sq. m. wherefor a letter of allotment was issued on 10.01.2001. We may notice the relevant clauses thereof. Note appended to Clause 3 of the said letter of allotment states that in the event of failure to comply with the terms and conditions by the Regular Letter of Appointment (RLA) holder, the allotment of an Industrial plot/ shed, within the stipulated period, the RLA shall automatically lapse and 10% application money deposited towards the cost of the plot/shed shall be refunded without any interest. However, if the allottee makes a request for the surrender of the plot/shed after complying with the terms and conditions, then the Principal amount will be refunded without any interest after making a deduction of 10% of the cost of the4 provides for other Terms and Conditions governing schedule of payment of the balance 75% of the price of plot/shed. Clause 6 provides for the consequences ofof the balance amount orof the terms and conditions of the Letter of Allotment/Agreement. In such an event, the RLA shall stand withdrawn with the resumption of the plot/shed and refund of the deposit without any interest with 10% deduction. Clause 8 provides for the Schedule of Construction and "Going into Production". It mandates the allottee to commence construction of building as per the approved building plans within a period of one year from the date of the offer of possession. The allottee will be required to start commercial production within a period of three years from the date of offer of possession. Extension for commencement of construction can be granted for 6 months maximum if circumstances were beyond the control of the allottee. Similarly, extension of one year can be granted for commencement of commercial production for reasons beyond its control and only if 10% of the permissible area has been constructed and effective steps taken for completion of project subject to payment of the extensionallottee will be deemed to have completed the project if he constructs minimum 25% of the permissible covered area and starts commercial production within the period specified therein. Clause 14 provides for consequences ofto the schedule of payment and schedule of implementation. In such an event and on an unsatisfactory reply to the show cause notice, the HSIDC is empowered to the plot/shed and the principal amount is to be refunded without payment of interest and after deduction of the 10% of the26 provides for the resumption of plots by HSIDC in the event ofof the terms and conditions after givingnotice therefor. The principal amount will be refunded without payment of interest and after deduction of the 10% of the plot/shed without interest. The allottee will be free to remove the structure/debris within a period of 2 months of resumption order at his own cost. The allottee will not be entitled to any payment/compensation for building constructed by it on the resumed plot. Clause 27 provides that no restoration of resumed plots shall beagreement also provides for an appeal against the order of the competent authority of the Corporation before the Commissioner, Industries, Government of Haryana. An offer of physical possession was made to the firm by the Corporation by a letter dated 20.12.2001 wherein the schedule of payment in five instalments beginning from 1.07.2002 to 1.07.2004 was specified. It was furthermoreare, therefore, requested to deposit the installments along with interest @ 18% per annum from the date of offer of possession on the due dates otherwise you would be liable to pay penalty equivalent to 10% of the amount due and if you fail to pay the penalty within the prescribed period which would be specified by the Estate Manager, the plot would be liable for resumption after affording you opportunity of personal hearing beforehowever, appears that handing over of actual possession took some time and possession was handed over only on 8.12.2003. At the time of handing over of possession, the area of the land, measurement thereof as also the boundaries wereRespondent No. 1 herein filed an application for construction of the building on 19.12.2003. Indisputably, again the permission for construction of the buildings was to be granted only by the Corporation. The Corporation itself granted permission only on 20.03.2004 where after the construction started. It was completed in May,Corporation, however, by a letter dated 13.07.2004 asked the firm as to what steps had been taken by it for constructions of the plot in question with documentary proof as also need to apply for extension on the premise that offer of possession was issued on 1.01.2002 and the construction activity, thus, was required to be started within one year therefrom and production of the Unit should have been started from the date of offer of possession. Respondent No. 1 intimated about the change of the constitution of its firm. It by a letter dated 30.11.2004 categoricallycould not start the construction on the above mentioned plot, due to some financial constraints. We are pleased to inform you that we have been able to arrange sufficient funds for the construction and have already started the construction of your factory at the above mentioned plot. The factory will be operational within three months. Since we have the building plans approved by your department and have obtained temporary connections for water and electricity, the construction is going on in full swing. Regarding the balance amount, enclosed please find Demand Draft No. 000433 for Rs. 908461/drawn on HDFC Bank. This clears our account as mentioned in your letter. Copy of the approval of the building plan is attached herewith for yourthe same, as no action was taken, a legal notice was issued by the Respondent No. 1 through its lawyer dated 1.03.2005 inter alia drawing its attention toActual physical possession had been handed over on 9.12.2003 and the building plans were approved by the Corporation on or about 20.03.2004.(ii) Steps for construction had been intimated to the Corporation together with a letter for extension of time.(iii) Pursuant to the show cause notice dated 2.11.2004, a sum of Rs. 9,08,461/had been remitted.(iv) 25% of the construction had been completed and despite the same the land was said to have been resumed without issuing any show cause notice although the respondent had already deposited the saidCorporation was asked to withdraw the said notice of resumption. By an order dated 3.03.2005, however, the plot was said to have been resumed inter alia on the premise that Respondent no. 1 had violated Clause 4 of the said Agreement. A demand draft of Rs. 9,08,461/was not accepted and a cheque for a sum of Rs. 6,83,349/towards the refundable amount as also the demand draft for the said sum of Rs. 9,08,461/, an appeal preferred there against has been dismissed. Respondent No. 1 aggrieved by and dissatisfied therewith filed a writ petition before the Punjab and Haryana High Court. A Division Bench of the High Court by reason of the impugned judgment while setting aside the order of resumption as also the order of the appellate authority dated 27.05.2005,plot in question stands restored back to the petitioner. The amount refunded by the Corporation to the petitioner shall be repaid to the Corporation within a period of two weeks from the date a certified copy of this order is received.The respondentCorporation would be at liberty to inform the petitioner through a written communication, if there are still any outstanding dues against the petitionerfirm. On receipt of the aforesaid communication, the petitionerfirm shall be required to clear all the aforesaid outstanding dues also, within a further period of two weeks thereof. It is made clear that if the payments as notice above are not made by the petitionerfirm, the present petition shall be deemed to have beenherein are directors of M/s. Shiv Shakti Embroidery Pvt. Ltd. (Company). The Company was allotted an industrial plot. An additional facility was granted to the industrial undertakings for allotment of residential plots for their directors. Pursuant to and in furtherance of the said policy decision to grant additional benefit, the respondents were allotted residential plot No. 331 in Sector 1, Manesar. The terms and conditions provided for a schedule of payment, the relevant clauses whereof read asThe balance amount of Rs. 10,69,200/of the tentative price of the plot can be paid in lumpsum without interest within 60 days from the date of issue of the allotment letter or in six (6) half yearly installments. The first installment will fall due after the expiry (6) six months of the date of issue of this letter. Each installment would be recoverable together with the interest on the balance price at 15% interest on the remaining amount the interest shall, however, accrue from the date of offer of possession.4. You are requested to remit Rs. 1,78,200/in order to make the 25% price of the said plot within 30 days (upto 17.08.09) from the date of issue of this letter. The payment shall be made by the Bank Draft payable to the HSIDC, Panchkula and drawn on any scheduled bank at Panchkula. In case of failure to deposit the said amount within the above specified period, the allotment shall be cancelled and the 10% earnest money deposited alongwith the application shall stand forfeited to the HSIDC against which you shall have no claim for damage.5. The balance 75% amount i.e. Rs.8,91,000/of the above price of the plot can be paid in lumpsum without interest within 60 days from the date of issue of the allotment letter or in half yearly installments. The first installment will fall due after the expiry of six months of the date of issue of this letter. Each installments would be recoverable together with interest @ 15% interest per annum on the remaining amount as mentioned in clause No.were made in the name of the Company although allotment had been made in the individual names of the respondents herein. The allotment of the said plot was cancelled on the premise that payment has not been made in terms of Clauses 4 and 5 of the offer of allotment dated 18.07.2003. A proceeding for resumption was initiated and by an order dated 1.06.2004, the said plot was resumed. Aggrieved by and dissatisfied therewith, a writ petition wasapplied for and was allotted an industrial plot at Manesar, Gurgaon by the Appellant Corporation. Indisputably, it deposited a sum of Rs. 3,96,000/being 10 per cent of the total cost of the said plot. It, however, was not satisfied with the said allotment. A prayer was made to change the plot which was accepted by the appellant Corporation. He was allotted a plot No. 269 in Sector 7 on or about 9.7.2004. They were, however, not satisfied with the said allotment and made another representation for change of plot. On or about 21.9.2004, the appellant deposited an amount of Rs. 6,00,000/towards 15% of the total price of the plot. He was, however, required to deposit the said amount by 22.7.2004 which was extendable by another 30 days on interest at 11% per annum after 22.7.2004, but he failed to do so. Appellant took a stand that the letter of allotment elapsed automatically. The amount of Rs. 3,96,000/was directed to be refunded. The bank draft sent by the respondent for an amount of Rs. 6,00,000/was also returned. The respondent filed a WritHigh Court was of the opinion that although respondent was required to deposit 15% of the price of plot on or before 22.7.2004, but by clause 3 of the Letter of Allotment, the said amount could be deposited by him within 60 days. The High Court accepted that there had been a delay on the part of the appellant. The interim order was passed directing the appellant tothe plot, however the same was not allotted. The High Courtin view the facts and circumstances of the case, as noticed in the above portion of the judgment, we allow the present petition and restore the allotment of plot No. 269, Sector 7, Manesar to the petitioner as per original terms of allotment. Since the petitioner was required to pay the entire amount, even by way of instalments upto January 16, 2007, therefore, the petitioner is directed to make the total payment of the entire amount towards the cost of the plot in question within a period of three months from the date a certified copy of this order is received. On receipt of the entire payment, the actual physical possession of the plot in question shall be handed over to the petitioner. The petitioner shall, however, remain bound by all the terms and conditions of the letter ofof allotment was issued on 23.1.2001. The final agreement was entered into on or about 20.9.2001. However, possession was delivered on 31.10.2001. On the premise that respondent has not complied with the terms and conditions of the agreement, a notice was issued on 17.4.2003. Respondent, however, was asked to take physical possession of the land and also to apply for extension for the purpose of starting construction by the Estate Manager of the appellant Corporation by a letter dated 24.4.2003. Pursuant thereto physical possession was said to have been handed over on 6.5.2003. Respondent, thereafter applied for grant of water connection on 1.7.2004. He submitted his building plan on 10.7.2004. Alleging that the ownership is in dispute, the plan was not sanctioned. The Town Planner of the appellant asked the Senior Manager of the Corporation to ascertain ownership status before the building plans could be cleared. From an internal communication dated 21.7.2004, however, it appears that building plans were not processed on the premise that ownership clearance had not come from the Corporation. By a letter dated 23.8.2004, respondent informed the concerned authority that the request of clearance of ownership status was being pursued with the authorities of theshow cause notice for resumption of the plot, however, was issued on or about 21.9.2004 alleging that construction work had not been started within a period of one and a half year of the handing over of the possession and some amount wasin their show cause, brought the aforementioned fact to the notice of the concerned authority of the appellant. It was requested that the excess period for starting construction may be waived by imposing some penalty. An assurance was given to start construction on clearance of building plan and ownership status. It was pointed out that the sum of Rs. 14,30,940/had already been deposited. Respondent filed a further reply on 22.12.2004. No opportunity of personal hearing was granted. By an order dated 7.3.2005, an order of resumption was issued. However, despite the same, letters were written by the appellant communicating the respondent in respect of certain errors in the building plans as would appear from the letters dated 8.4.2005 andted by the respondent on 14.12.2005 whereto again some defects were pointed out therein. In the meantime, the appellant preferred an appeal which was dismissed by the Commissioner by an Order dated 16.2.2006. A Writ Petition was filed which by reason of the impugned judgment has beenthe Writ Petition inter alia a contention was raised that the appellant had regularized the delay by extending the period of construction even for a period of four years in favour of the parties named therein which was not denied or disputed. It claimed parity with the decision of the High Court in case of M/s. Jassi Designs Versus Managing Director, HSIDC and Others being C.W.P. No. 4530 of 2005. The SLP preferred there against has beenapplied for and was allotted an industrial plot vide its Regular Letter of Allotment dated 29.8.2001 at IMT, Manesar. Thereafter, a final Agreement was entered into between the parties on 24.9.01. On 4.11.01, physical possession was offered to the respondent, which was not taken. Allegedly, no construction was started by the16.7.02, the appellant issued a show cause notice to the respondent for its failure to take possession and set up the industrial unit. Respondent vide its letter dated 24.2.03 requested the appellant for handing over the possession. In response thereto, the respondent was asked to clear the outstanding dues in regard to the second installment. Subsequently, the appellant by its letter dated 14.5.03, asked the respondent to attend its office to take over the possession of the plot. Despite being handed the possession on 17.6.03, no construction was commenced by the respondent. On 29.10.03, a show cause notice was issued to the respondent for failure to commencevide its letter dated 7.11.2003, requested for six months extension. Thereafter, on 7.10.2004, a show cause notice was issued to the respondent as to why an order of resumption should not be passed against him. On the failure of the respondent to satisfy the concerned authority with regard to the delay in commencement of the construction, the plot was ordered to be resumed vide letter dated 28.2.05. The resumption order was challenged before the Commissioner of Industries, who, vide its order dated 13.1.2006, dismissed theaggrieved by the order, the respondent herein filed a Writ petition before the High Court. The High Court by its order dated 28.7.2006, allowed the said Writ Petition and quashed the order ofapplied for and was allotted an industrial plot in Industrial Estate IMT, Manesar, by the Appellant Corporation. Allegedly, a dispute arose as regards handing over of the actual possession of the said plot. Respondents contend that the entire 1st installment along with interest was duly paid within the stipulated time except for delay of 22 days. Indisputably, the appellant offered the respondent possession of the plot and asked to commence construction by its letters dated 19.12.2001, 9.8.2002 and 11.11.2003. Respondents contend that though a request was made to hand over possession by its letter dated 2.8.02 however, the same was note notices dated 1.3.05 and 19.5.05 were issued by the appellant to the respondent. After giving an opportunity of personal hearing to the respondent, the said plot was resumed on 7.7.05. Respondent filed a Writ Petition before the High Court which was disposed of on 8.08.2006 directing the allottee to appear before the Appellate Authority. Thereafter, the appellate authority dismissed the said appeal. Respondent then filed a Writ Petition before the Highapplied for and was allotted an industrial plot vide its allotment letter dated 14.6.2000 at IMT, Manesar. On 14.8.2000, a Regular Letter of Allotment was issued to the respondent whichrequired it to commence construction of the building within a period of one year and commercial production within a period of three years from the date of offer of possession. The said clause was also incorporated in an Agreement dated 8.9.00 entered into between the two parties. Indisputably, on 24.12.01, the appellant issued a receipt for acceptance of three demand drafts to the respondent towards payment of the installments. On 8.1.03, a show cause notice was issued by the appellant to the respondent regarding the failure to set up the industrial unit. On 1.1.04, a show cause notice was issued to the Respondent as to why the said plot should not be resumed in view ofof construction andof the 4th and 5th installments. Being dissatisfied by the reply so rendered by the respondent, the appellant gave the respondent an opportunity of retaining the plot by allowing him to convey his acceptance to buy the plot at the current price of Rs. 2200/ed by the order of resumption, the respondent preferred an appeal before the Commissioner of Industries on 9.2.04. The said appeal was rejected by the Commissioner on the ground that the order of resumption was not final. Aggrieved by the two orders, the respondent filed a Writ Petition in the High Court. The High Court while dismissing the Writ Petition on the ground that an appeal was pending before an appropriate authority, however allowed the respondent to file its objections against the order of resumption. On 26.2.04, the respondent filed its objections. On 23.11.2004, the High Court dismissed the Writ Petition directing the appellant to consider and dispose off the objections. On 27.6.2005, the objections were dismissed by the appellant on the ground that the said plot had become liable for resumption. However, before resumption, an opportunity was given to the respondent to retain the plot at the current price of Rs. 2200/he same having not being accepted by the respondent, the objections were rejected by the appellant and the amount was refunded as per the terms of the Agreement. Aggrieved by the said order, the respondent preferred an appeal before the Commissioner. On 12.7.05, the appellant issued a letter to the respondent intimating the withdrawal of the possession of the plot. Aggrieved by the order and during the pendency of the appeal before the commissioner, the respondent filed a Writ Petition before the High Court on 18.7.2005. On 8.5.2006, the High Court without going into the merits of the case, allowed the Writapplied for and was allotted an industrial plot vide its Regular Letter of Allotment dated 26.6.2000 at IMT, Manesar. An Agreement containing the terms and conditions of the allotment was executed between the two parties on 12.9.2000. Physical possession of the plot was taken over onapplied for and was allotted an industrial plot vide its Regular Letter of Allotment dated 22.10.1998 at Growth Centre Investate Bawal, District Rewari. Physical possession of the plot was offered on 21.5.02. However, the respondent failed to take over the possession. On 21.4.04, the appellant issued anotice to the respondent directing him to start commence construction within a period of two years and to implement the project on or before 21.5.05. The respondent intimated the appellant that the construction would start immediately and requested for a three year extension period. On 17.1.2005, the appellant issued anotice to the respondent for delay in taking the physical possession of the plot and forof construction. Vide its letter dated 31.1.05 the respondent informed the appellant that due to loss in its business, they were unable to continue industrial activity and had decided to surrender the plot. It thus requested for a refund. On 25.2.06, the respondent requested for a personal hearing. After hearing the respondent in person, the appellant passed an order of resumption. Aggrieved by the said order, the respondent filed a Writ Petition before the High Court. By its order dated 25.8.06, the High Court set aside the Resumptionapplied for and was allotted an industrial plot vide its Regular Letter of Allotment (RLA) dated 13.3.02 at IMT, Manesar. On 12.4.02, a final Agreement was entered into between the parties incorporating the terms and conditions of the allotment letter. On 18.11.2003, the respondent took physical possession of the plot. On 2.11.04, anotice was issued to the respondent on account of its failure to commence construction and default in making the payment of the 4th and 5th installments. Due to unsatisfactory reply of the respondent by his letter dated 14.12.04, the appellant resumed the plot by its order dated 18.2.05. Aggrieved by the said order, the respondent on 11.11.1999 filed an appeal before the Financial Commissionersaid appeal was dismissed by the commissioner on the basis that it was devoid of any merit. Feeling aggrieved by the order of resumption and the order dismissing the appeal, the respondent filed a Writ Petition before the High Court. By an order dated 7.8.06, the High Court set aside the order ofapplied for and was allotted an industrial plot vide its Regular Letter of Allotment (RLA) dated 9.4.01 at Kundli Industrial Estate. On 11.04.01, a final agreement was entered into between the parties incorporating the terms and conditions of the allotment letter. Vide its letter dated 3.5.01 the appellant offered the respondent the physical possession of the plot. On 24.12.03, the appellant issued anotice to the respondent for failure to commence construction as well as commercial production within the stipulated time. Respondent on grounds of illness of his mother and other financial constraints requested for an extension to commence construction. Vide its letter dated 18.1.05 the appellant passed an order of resumption of the plot against the respondent and refunded his cheque after making the necessary deductions. Aggrieved by the said order, the respondent on 14.1.05 filed an appeal before the Financial Commissioner Industries. Vide its letter dated 28.8.06, the appellant informed the respondent that the commissioner had dismissed his appeal by an order dated 1.8.06 on the ground that it was devoid of any merit. Being aggrieved by the order of resumption and the order dismissing the appeal, the respondent filed a Writ Petition before the High Court. On 5.12.06, the High Court set aside the order ofapplied for and was allotted an industrial plot vide its Regular Letter of Allotment (RLA) dated 24.5.04 at IMT, Manesar. Allegedly, the petitioner requested the appellant vide its letters dated 15.6.04 and 05.7.04 to change the site of the plot on the ground that the area where it was so situated was not developed. Allegedly, on 19.8.04, the respondent met the appellant for the change of plot who were then informed that the plot could not be changed. On 22.7.04, the RLA23.8.04, the respondent remitted 15% of the cost of the plot. Vide its letter dated 12.1.05, the appellant cancelled the allotment and refunded the amount paid by the respondent on the ground that he had failed to comply with clause 3 of the Allotment letter providing for the payment and thus the RLA had lapsed automatically. On 19.1.05, the respondent requested the appellant to reconsider his case. Vide its letter dated 21.3.05 the appellant informed the respondent that his request had been rejected and refunded the amount so paid. Aggrieved by the said order, the respondent preferred an appeal before the Commissioner of Industries which by its order dated 13.1.06, dismissed the appeal. Aggrieved by the order of the commissioner, on 4.9.06, the respondent filed a Writ Petition before the High Court. The High Court by its order dated 5.12.06 while allowing the Writ Petition, quashed the letter dated 12.1.05 and the appellate order on the premise that the respondent had always showed his eagerness to initiate construction and the delay in making the payment had been on account of a genuine belief by the respondent that the request for an alternative plot was pending before theapplied for and was allotted an industrial plot vide its Regular Letter of Allotment (RLA) dated 23.1.01 at IMT, Manesar. Thereafter, a formal Agreement was entered into between the parties incorporating the terms and conditions of the RLA. Allegedly, the respondent made various requests to the appellant for delivering the physical possession of the plot after making necessary developments. On 19.12.01, the appellant issued a letter thereby offering the respondent physical possession of the plot. On the other hand, on 24.2.03, the appellant issued a notice to the respondent towhy the plot should not be resumed on account of its failure to comply with the terms and conditions of the allotment letter. Subsequently, two morenotices dated 13.10.03 and 8.12.03 were issued. Allegedly, an authorization letter dated 10.2.04 was issued to the respondent for taking over the physical possession. Allegedly, the respondent by its letter dated 4.2.04 requested the appellant to hand over the possession of theby its letter dated 15.2.05, the respondent gave an undertaking to the appellant to commence construction immediately, if it delivered the possession of the plot. On 7.2.05, the appellant issued a notice to the respondent toas to why the plot should not be resumed in light of the default made. On being unsatisfied by the reply of the respondent vide its letter dated 15.2.05 to thenotice, the appellant passed an order of resumption of the plot on 7.7.05. Being aggrieved by the said order, the respondent on 5.08.05 preferred an appeal before the Commissioner of Industries. Vide its letter dated 19.4.06, the appellant informed the respondent that the commissioner had dismissed his appeal by an order dated 13.1.06 on the ground that it was devoid of any merit. Being aggrieved by the order of resumption and the order dismissing the appeal, on 25.6.06, the respondent filed a Writ Petition before the High Court. The High Court, by its judgment and final order dated 27.11.06, set aside the order ofapplied for and was allotted an industrial plot vide its Regular Letter of Allotment (RLA) dated 30.6.99 at Industrial Estate, EPIP, Kundli. On 18.1.00, on a request made by the respondent, the allotment of the said plot was changed due to a change in the constitution of the respondents company. Subsequently, on 20.1.00, a supplementary agreement was entered into between the parties. As per the terms of the new Agreement, the respondent was to commence construction within a period of six months. Appellant issued twonotices to the respondent dated 14.8.00 and 26.2.01 for its failure to commence construction. Vide its letter dated 7.11.01, the respondent sought extension of time to start construction and commercialthe new Industrial Infrastructure Development Policy coming into force, the appellant extended the time for implementation of the project to three years i.e. up to 29.6.02. Allegedly, the respondent made several requests by its various letters dated 26.2.03, 07.5.03, 18.5.03, 20.6.03 and 29.8.03 for extension of time which was purportedly rejected or not considered by the appellant. On 22.1.03, anotice was issued by the appellant to the respondent to explain why a resumption order should not be passed forof the building within the stipulated time. After being given a personal opportunity of hearing on 18.6.03, the appellant vide its letter dated 27.8.03 resumed the plot and requested the respondent to collect the cheque of the amount deposited by him. Allegedly, the order of resumption was passed against the respondent without a personal hearing. Being aggrieved by the said order, the respondent on 28.9.03 preferred an appeal before the Commissioner of Industries. Vide its letter dated 28.8.06, the appellant informed the respondent that the commissioner had dismissed his appeal by an order dated 1.8.06 on the ground that it was devoid of any merit. Being aggrieved by the order of resumption and the order dismissing the appeal, on 9.10.06, the respondent filed a Writ Petition before the High Court. The High Court, by its judgment and final order dated 12.12.06, set aside the order of resumption.

Court's reasoning:
Allotment of industrial plot keeping in view the object and purport for which the Corporation had been constituted and incorporated must be held to be a governmental function. In a case of this nature where the aim and object of the Corporation as also the State is to encourage industrialization while adjusting equity, the purpose for which the Scheme was made would be a relevant factor. Only because allotment of land has been effected through a letter, the same by itself does not make such allotment and/ or the provisions contained therein to be matters within `private law domain asfrom `public law domain. The State exercises deep and pervasive control over the activities of theparties themselves agreed that despite the fact that the Corporation is a juristic person, an appeal against its decision shall lie to the Financial Commission of the State. Indisputably, the function of the appellant is a sovereign function. It, in any event is a State, within the meaning of Article 12 of the Constitution of India. Its action, therefore, must be fair and reasonable so as to sub serve the requirements of Article 14 of theletter of allotment dated 10.01.2001 indisputably sets out the terms and conditions thereof. But, the same is not exhaustive. The terms and conditions were supplemented by the Corporation itself in its letter dated 20.12.2001 when offer of handing over physical possession was made, by reason whereof not only a period of two years was provided for deposit of installment along with interest at the rate of 18% per annum but also a provision had been made that in the event of failure to adhere to the schedule enumerated therein, penalty equivalent to 10% of the amount due would be levied. It was furthermore laid down that in the event of failure of the `firm to pay the amount penalty within the prescribed period, the plot would be liable for resumption. The terms and conditions of letter of allotment would clearly show that resumption of the plot is nota State takes penal action against the allottee, its bona fide would be one of the relevant factors before an order of resumption and forfeiture of the amount deposited is passed. The particulars contemplated in the letter of allotment as also the letter of offer of possession and the procedures laid down therefor were required to be scrupulously complied with. The letter of allotment as also the letter of offer of possession must be read conjointly. The very fact that not only the amount specified therein was required to be paid in instalments but also with interest at the rate of 18% per annum, was required to be borne in mind. Thus, in a case where the allottee had complied with the terms of allotment in the matter of payment of instalments, the same would be a relevant factor for exercising the enabling clause of resumption by a `State. Not only that, a further opportunity was required to be given to the allottee even if there was some default on its part inasmuch as the appellant itself provides for levy of penalty. The power of resumption, thus, must be resorted to only in a case where despite grant of the opportunities contemplated in terms of the letter of intent wereissuance of letter of offer of physical possession dated 20.12.2001, the fact that actual possession had not been handed over for a period of two years is not in dispute. The Corporation did not say that actual possession was not taken by the respondent despite offer having been made in that behalf. It, in its anxiety to set a time limit for ensuring that the commercial production starts at an early date, was expected at least to send a reminder. It failed and/ or neglected to do so. For the purpose of approval of the building plan, the time taken by it also would have been a relevant factor for passing an order ofalthough do not intend to lay down a law that all the aforementioned period should be excluded from computation for the purpose of grant of notice of resumption, but there cannot be any doubt whatsoever that while judging the conduct of the parties, the appellant was obligated to judge its own conduct in thethe provisions of the aforementioned Act are not applicable in the instant case, Jagdish Chand (supra) is being referred for showing that when two remedies to enforce a contract are available, the power should be exercised in reasonable manner. So construed, a harsher remedy may not ordinarily be resortedHigh Court, in our opinion, has notthe contract nor waived the rights and obligations of thethe court can balance the equities between the parties but the same does not necessarily mean that in all cases this Court should refuse to exercise its discretionary jurisdiction. Each case must be considered on its own merit and no hard and fast rule can be laid downthe instant case, the High Courts jurisdiction is in question. The learned counsel for the parties have addressed us at great length on the individual merit of thetherefore, are of the opinion that on the said ground alone, we would not refuse toCivil Appeals arising out of SLP (C) No. 17426 of 2006, no opportunity had been given to the appellants to file counter affidavit. Even the High Court had proceeded on the basis that equity demands that they should be given some extension of time to perform their part ofagree with the High Court that Clause 3 of the said offer of the order of allotment dated 18.07.2003, on the one hand, and Clauses 4 and 5, on the other, are irreconcilable. Payment to be made under Clause 3 cannot be subject to the stipulations contained in Clauses 4 and 5. They are independent of each other. The allottee in terms of Clause 3 had an option. Mode of payment in terms of Clause 3, on the one hand, and Clauses 4 and 5, on the other, are distinct and different. However, the High Court was not correct when it directed thatof land would be subject to the final decision of the case. Cancellation of plot as also reallotment thereof had been made in June 2004. The writ petition was filed in July,reason of the judgment of the High Court, the right of a third party has been affected. He without having been impleaded as a party in the writ petition cannot suffer an adverse order for which he is no way responsible. A statement has been made before us by the learned Additional Solicitor General that no residential plot is available for allotment. He, however, submits that as and when such a plot is available, the same would be offered to the respondent. We may place on record the aforementioned submission. However, we feel that the respondents were not to be blamed for not depositing the amount. Invocation of Clause 4 is clearly illegal. We, therefore, are of the opinion that the respondent should be suitably compensated on monetary terms. We direct the appellants to pay a sum of Rs. 1,00,000/to the respondents herein. We, however, also direct that keeping in view the statements made at the Bar, as and when any residential plot becomes available, the same should be allotted to the respondents on the sameis a clear case where the respondents have failed to abide by any of the terms of contract. It did not deposit even the initial amount in time, there was no reason for it not to do so. Even interest payable on the said amount had not been paid. The appeal should, therefore, bethis case, the respondent has clearly been discriminated against. Appellants action is clearly unfair and unreasonable. In any event, it has waived its right. Furthermore, it was a case where the principles of natural justice should have been compliedHigh Court in, this case, in its impugned judgment has taken care to see that the object for grant of allotment were fulfilled being promotion of industrial growth. Applying the principles of law as indicated hereinbefore, we are of the opinion that no case has been made out for our interference with the impugnedhad already appointed an architect for construction of the building. It had already started constructions. The fact that it was the Department which did not grant any license. The Appellate Committee, however, did not consider this aspect of the matter at all and thus the appellate orders suffered from totalhe High Court while allowing the petition quashed the resumption order and directed the respondent to complete the construction of the industrial building within a period of six months from the date of offer of the possession of theall these cases, it is difficult to uphold the order of the High Court. But a general offer was made by the learned Additional Solicitor General that those who intend to obtain reallotment of plot may do so on payment of the price as per the current rate as on the date of the order of the Highus, several allottees had categorically made a statement that they are ready and willing to pay the prevailing price as fixed by the appellantCorporation. Keeping in view the facts and circumstances of this cases, we are of the opinion that in the event, respondents offer the prevailing price as on the date of judgment of the High Court, the plot, in question, shall standand should be subject to the same terms and conditions. Such reallotment may be made even in cases where we have found the order of the High Court to beshall deposit the amount within six weeks from date. Appellant shall hand over the possession of the plot, in question, within four weeks thereafter. The highest executive of Appellant – Corporation shall see to it that the order of this Court is complied with. It is, however, made clear that in the event of failure on the part of the respondents concerned in making payment in terms of this order, it would be open to the appellant to take recourse to such action as is permissible in law.