IMPORTANT POINT
Writ petitions can be entertained even in contractual matter if the action of the respondent is illegal and without jurisdiction; if the principles of natural justice have been violated and if the petitioners fundamental rights have been violated.

Headnote:Constitution of India—Article 226 —Contract Act, 1872—Section 23—Writ petition in a contractual matter—Maintainability—Plea of availability of alternative remedy—Appellant made an application for allotment of a plot for construction of a multiplex at railway station on 18-5-2004—Allotment made by City Industrial Development Corporation by the Board’s Resolution dated 3-6-2004—Appellants deposited amount as and when directed by respondent 1—On 28-2-2005, CIDCO being the Development Authority of the area issued commencement certificate to appellants permitting them to start construction—However, on 14-7-2005, appellants received show cause notice seeking to cancel allotment in favour of appellant on ground that allotment was void as made without issuance of tender, therefore, opposed to public policy—CIDCO sought to resume possession of plot—Writ petition filed against cancellation of allotment dismissed on ground of availability of alternative remedy—High Court rejected prayer for interim protection to appellant—Supreme Court ordered stay of dis-possession—As per Land Disposal Policy of CIDCO and New Bombay Disposal of Lands Regulations, 1975, allotment of land could be done by considering individual application—In the instant case there is no infirmity in the allotment—There was no application pending with CIDCO prior to the application of appellant—In Board’s deliberation it was noted that promoting a Multiplex near railway station shall be adding value to the development of that node and was needed in view of shortage of entertainment facility in Navi Mumbai—Whether High Court was justified in dismissing writ petition as not maintainable—(No)—Matter remitted to High Court for fresh disposal.
       Held : He invited our attention to the Whirlpool Corporation case (supra) wherein this Court has held that there are three clear-cut circumstances wherein a writ petition would be maintainable even in a contractual matter. Firstly, if the action of the respondent is illegal and without jurisdiction, Secondly, if the principles of natural justice have been violated and Thirdly, if the appellants’ fundamental rights have been violated.(Para 14)
       In our opinion, the High Court has committed a grave mistake by relegating the appellant to the alternative remedy when clearly in terms of the law laid down by this Court, this was a fit case in which the High Court should have exercised its jurisdiction in order to consider and grant relief to the respective parties. In our opinion, in the instant case, 3 of the 4 grounds on which writ petitions can be entertained in contractual matter were made out and hence it was completely wrong by the High Court to dismiss the writ petitions. In the instant case, 3 grounds as referred to in Whirlpool Corpn. (supra) has been made out and accordingly the writ petition was clearly maintainable and the High Court has committed an error in relegating the appellant to the civil court.(Para 39)
       It is also pertinent to notice when the allotment was made in favour of the appellant there was no entertainment facility available in the area and CIDCO in its endeavour to do proper planned development of the area was obliged to provide for entertainment for the residents. CIDCO in fact had put an advertisement for tender for various other plots for the said purpose and upon getting no response to the advertisement, CIDCO approved the allotment in favour of the appellant on first come first serve basis. It is not the case of CIDCO or by any other private party that any other application was made prior in time to the application made by the appellants for the same plot and hence the allotment in favour of the appellant cannot be faulted in any manner. It has been held by several decisions of this Court that while developing a new township the objective of the planning authorities is not to earn money but to provide for systematic and all-round development of the area so that the purpose of setting up the township is achieved by more and more people wanting to live in the area in view of the various amenities being provided in the area. Considering this objective in mind, we are of the view that the allotment made in favour of the appellants cannot be faulted with and this Court will accordingly set aside the orders of CIDCO seeking to resile from a concluded contract in favour of the appellants.(Para 40)
       The High Court has disposed of the writ petition only on the ground of availability of alternative remedy. The High Court has not recorded its finding on the merits of the rival claim. Since elaborate arguments were advanced by learned senior counsel for the appellant and countered by learned senior counsel for the respondent, we extracted the entire argument in extenso in order to enable the High Court to consider all the above submissions made by both the parties on merits and dispose of the same within a period of 6 weeks from the date of receipt of this judgment.(Para 42)

JUDGMENT

Dr. AR. Lakshmanan, J.—

SLP (C) NO. 11085 OF 2006:

Leave granted.

2. The above appeal was filed against the final judgment and order dated 30.06.2006 passed by the High Court of Judicature at Bombay in W.P.No. 9467 of 2005 whereby the High Court has rejected the writ petition filed by the appellants by holding that the appellants have an equally efficacious remedy of filing a civil suit and thus the writ jurisdiction cannot be invoked.

BACKGROUND FACTS:

3. The appellant made an application for allotment of a plot on 18.05.2004 for construction of a multiplex at Kharghar railway station. The first respondent, The City Industrial Development Corporation (in short, “CIDCO”) asked the appellants to pay an EMD of Rs. 20 lacs being 10% of the tentative price of the plot in order to consider the application of the appellant. The appellant deposited the said amount of EMD immediately. CIDCO, vide its Board Resolution dated 03.06.2004, approved the allotment in favour of the appellant considering the fact that there were no multiplex in the area and the earlier effort of CIDCO to advertise for such plots had met with no response. CIDCO issued allotment letter in favour of the appellant asking the appellant to pay Rs.1,80,00,000/- lacs being the balance price of the plot. The appellant made two separate payments of Rs. 90 lacs each towards the balance price of the plot on 16.08.2004 and 19.08.2004. The appellant paid a sum of Rs.20,00,600/- being the other charges demanded by the respondent. The appellant was asked to pay a further sum of Rs. 65,096/- which the appellant paid immediately. CIDCO unilaterally decided to ask the appellants to pay a further sum of Rs.20 lacs by enhancing the rate at which the plot was to be allotted to the appellant from Rs. 2500/- per sq. metre as demanded in the allotment letter to Rs.2,750/- per sq. metre because the plot of the appellant was on a 24 metre road. The appellant on 17.11.2004 paid a further payment of Rs.20 lacs along with Rs. 2,96,078/- plus Rs. 4,957/- being the additional cost and the other charges. On 14.01.2005, the appellant paid a further sum of Rs.19,828/- being the sum demanded by the respondent. The appellant on 17.01.2005 entered into an agreement to lease with the respondent for the allotment of the plot. On 28.02.2005, CIDCO being the Development Authority of the area issued commencement certificate to the appellant permitting the appellant to start construction. On 14.07.2005, the appellant received a show cause notice seeking to cancel the allotment in favour of the appellant on the ground that the allotment was void in view of Section 23 of the Contract Act as being opposed to public policy. The main ground in the show cause notice was that the allotment was without issuance of tender and was opposed to public policy. On 27.07.2005, the appellant submitted a detailed reply to the show cause notice. On 16.12.2005, CIDCO issued an order canceling the agreement to lease and sought to resume the possession of the plot. According to the appellant only the appellant was singled out for cancellation whereas hundreds of allotments made without issuance of tender were allowed to remain which is also a matter of record. In these facts, on 28.12.2005, the appellant approached the High Court by way of writ petition against the said cancellation order dated 16.12.2005. The writ petition was numbered as 9467 of 2005 on 02.01.2006 and the High Court granted stay of the order dated 16.12.2005 and fixed the matter for further hearing on 04.01.2006. The appellant, vide reference dated 08.03.2006 of CIDCO, under the Right to Information Act, 2005 has asked them to supply information regarding the allotments made by Social Service Department without any advertisement i.e. by considering individual applications.

4. On 16.03.2006, the appellants filed their rejoinder before the High Court pointing out further information sought under the Right to Information Act which cl

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2007 Supreme(SC) 252

IMPORTANT POINTWrit petitions can be entertained even in contractual matter if the action of the respondent is illegal and without jurisdiction; if the principles of natural justice have been violated and if the petitioners fundamental rights have been violated.

Cases Referred (21)

IMPORTANT POINT
Writ petitions can be entertained even in contractual matter if the action of the respondent is illegal and without jurisdiction; if the principles of natural justice have been violated and if the petitioners fundamental rights have been violated.