Important Points
1. Principles of promissory/equitable estoppel cannot be invoked to protect illegal acts which are against law.
2. Merely because lands of a person was acquired under Punjab Town Improvement Act, 1922, he could not claim for preferential allotment of plot unless he falls within the definition of ‘local displaced person’ as defined under the Rules framed under the Act.

Headnote:(i) Punjab Town Improvement Act, 1922-Sections 36 and 73-Jullundur Improvement Land Disposal Rules, 1954 - Rule 2(b)-Utilisation of Land and Allotment of Plots by Improvement Trust Rules, 1975-Rule 2(a)-Punjab Town Improvement (Utilisation of Land and Allotment of Plots) Rules, 1983-Rule 2(d)-Preferential allotment of plots-Local displaced persons-Suit for allotment of plots in lieu of land acquired-Claim on basis that plaintiffs were ‘local displaced persons’-Lower courts decreed suit-Whether correct? - No - Notifications u/s 36 were anterior to 1983 Rules-Definition as found in 1954 Rules of ‘local displaced person’ did not apply-Respondent-plaintiffs have not been owners of land for continuous period of two years immediately before first publication of scheme u/s 36-Respondents did not qualify for preferential allotment-Initial acceptance of part of consideration towards allotment did not act as promissory estoppel.
       Held : A perusal of the above Rules shows that so far as the 1954 Rules are concerned, the definition of ‘local displaced person’ is confined to a person whose lands have been acquired for a scheme to be executed under the Damaged Areas Act. It is not applicable to any other scheme. So far as the 1975 and 1983 Rules are concerned, the definition of ‘local displaced person’ applies to a person whose property has been acquired and who has been owner of such property for a continuous period of two years immediately before the first publication of the scheme by the Trust. Thus, it is seen from all these three set of rules that in order to have the benefit of a preferential allotment reserved for a local displaced person, there are certain qualifying standards. Unless and until a person who wants to take benefit of the preferential reservation qualifies to be a local displaced person, the said benefit is not available to him. (Para 7)
       The Notification under Section 36 applicable to the acquisitions of the respondents in these appeals are dated 7.6.1963, 27.8.1964, 7.11.1966 and 3.9.1974, a date anterior to the coming into force of the 1975 and 1983 Rules. It is not disputed in these cases, on the contrary it is admitted that the acquisitions made under the Notifications referred to above, are not made under the Damaged Areas Act. That being so, the definition as found in the 1954 Rules of ‘local displaced person’ does not apply to the acquisitions concerned in these appeals. If that be so, none of the respondents could claim a preferential allotment as contemplated under Rule 4(2) of the 1954 Rules. Therefore, the very basis of the claim of preferential allotment is non est in these cases. Assuming for argument’s sake that the 1975 or 1983 Rules are applicable to the acquisitions in question even then a bare perusal of the statements in the Chart referred to above, shows none of these respondents qualifies to be a local displaced person even under those Rules because they have not been owners of the lands acquired for a continuous period of two years immediately before the first publication of the scheme by the Trust under Section 36 of the Improvement Act. Therefore, none of these respondents qualifies to be a local displaced person for the purpose of preferential allotment of plots by the Trust. Since it is the respondents who claim preferential allotment under the Rules, the onus is on them to establish the fact that they do fall within the definition of the ‘local displaced persons’ so as to entitle them to the benefit of preferential allotment. In our view, the respondents-plaintiffs have failed to discharge this burden and the courts below have erred in presuming that the respondents were entitled to preferential allotment reserved for the category of local displaced person. As a matter of fact, it seems that the courts below have proceeded on the basis that all persons whose lands have been acquired for the execution of any scheme by the Trust, automatically become local displaced persons. This view of the courts below is unsustainable. The benefit of reservation made for local displaced person will be available only to such of those persons who fulfil the requirements of the definition of ‘local displaced person’ under the relevant Rules applicable to the acquisition of their property. (Para 10)
       (ii) Estoppel - Promissory estoppel-No estoppel against law-Principle of promissory/equitable estoppel cannot be invoked to protect illegal acts which were against statute. (Para 12)

Judgment

Santosh Hegde, J.-Leave granted in all these special leave petitions.

2. These appeals arise out of a common judgment dated 9.8.1996 delivered in RSA No. 1972/88 and other connected appeals, by the High Court of Punjab and Haryana at Chandigarh confirming the judgment of the first appellate court and decreeing the suits of the plaintiffs.

3. The plaintiffs, who are the respondents in these appeals, had filed suits for declaration and mandatory injunction against .

the appellant herein, namely, Jalandhar Improvement Trust (for short ‘the Trust’), to allot them plots in lieu of lands acquired from them. The trial Court in some cases decreed the suit and in others, dismissed the suit. In appeal, the first appellate court decreed all the suits and granted the relief prayed for. The Trust preferred second appeals before the High Court of Punjab and Haryana which confirmed the decree of the first appellate court, giving rise to these appeals. The claim of the respondents in all these appeals arises on the basis that they are all ‘local displaced persons’ who are entitled to a plot each in lieu of the lands acquired from them by the appellant-Trust, in view of the preference given to such local displaced persons under the allotment rules.

4. Acquisitions involved in these appeals are made under Section 36 of the Punjab Town Improvement Act, 1922 (for short ‘the Improvement Act’) which empowers the authorities concerned to prepare and publish improvement schemes within the local areas concerned. Section 73 thereof empowers the State Government to make rules consistent with the Act and applicable to all improvement trusts including the appellant herein.

5. The State Government exercising the power vested in it under Section 73 of the Improvement Act on 5.1.1954 notified the Jullundur Improvement Land Disposal Rules, 1954. Rule 2(b) of the said rules defines ‘local displaced person’ as a person whose property has been acquired by the Trust for the execution of a scheme under the Punjab Development of Damaged Areas Act, 1951 (for short ‘the Damaged Areas Act). Rule 5(ii) of the said Rules provides for certain preferential allotments in favour of local displaced persons, among others.

6. On 18.9.1975, the State Government promulgated a Rule titled as “Utilisation of Land and Allotment of Plots by Improvement Trust Rules, 1975”. Rule 2(a) thereof defines “local displaced person” means a person who is the owner of a property acquired by the Trust for the execution of a Scheme and has been such owner for a continuous period of two years immediately before the first publication of the Scheme by the Trust under Section 36 of the Punjab Town Improvement Act, 1922.” Sub-rule (ii) of Rule 7 of the said Rules makes reservation of plots and tenements in favour of local displaced persons. On 22.12.1983, the State Government promulgated another Rule titled “The Punjab Town Improvement (Utilisation of Land and Allotment of Plots) Rules, 1983. Rule 2(d) of the said Rules defines `local displaced person’ as follows:-

“Local displaced person” means a person who is the owner of any land acquired by the Trust for the execution of any scheme under the Act and who has been such owner for a continuous period of two years immediately before the first publication of such scheme by the Trust under Section 36.”

Rule 4(2) of the said Rules provides for preferential allotment in favour of a local displaced person.

7. A perusal of the above Rules shows that so far as the 1954 Rules are concerned, the definition of ‘local displaced person’ is confined to a person whose lands have been acquired for a scheme to be executed under the Damaged Areas Act. It is not applicable to any other scheme. So far as the 1975 and 1983 Rules are concerned, the definition of ‘local displaced person’ applies to a person whose property has been acquired and who has been owner of such property for a continuous period of two years immediately before the first publication of th

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1999 Supreme(SC) 417

Cases Referred (1)