IN THE HIGH COURT OF JUDICATURE AT PATNA
Anjani Kumar Sharan, J.
M/s Naturals Dairy Private Ltd - Appellant
Versus
State of Bihar - Respondent
Civil Writ Jurisdiction No. 22922 of 2018
Decided On : 22-03-2021
Bihar Industrial Area Development Authority Act, 1974 – Section 6 – Cancellation of allotment of industrial plot – Purpose of leasing land was only to permit industries to come up and thereby to generate employment as well as to earn income to State – Several State and Central Public Sector undertakings have also been closed when such is fluidity of situation, taking a stringent view that non-establishment of industries must result in cancellation of lease cannot be countenanced – Instead, time ought to have been granted either to establish industries or to revive those which have become sick – In case, existing industries have become unviable, lessee can be permitted to go for diversification sudden or abrupt cancellation of leases would not only put lessee, but also various agencies, as well as employees to serious hardship – State Government irepeatedly inviting entrepreneurs from all over world to come and establish industry so that more and more employment could be generated and for this State Government is always announcing different types of incentives to lure them – State instrumentality are also expected to give them good and viable atmosphere so that they could come and establish their companies for betterment of public at large and are not expected to create hurdles on one pretext or other or on one pretence or other – Petitioner is successful in his attempt in proving through various documents issued by different Departments of State that its unit is functional and operational one – Impugned order quashed. (Paras 18 to 21)
JUDGMENT
Anjani Kumar Sharan, J. - Heard learned counsel for the petitioner, learned counsel for the Bihar Industrial Area Development Authority (hereinafter in short as 'BIADA') and learned counsel for the State.
2. Pleadings being complete, with consent of all the parties, this writ petition has been heard at length for final disposal at this stage itself.
3. The petitioner has approached this Court seeking the following reliefs:
i. To issue an appropriate writ (s)/ order (s) /direction(s) in the nature of Certiorari quashing the order dated 20.11.2018 as contained in memo no. 5195 dated 22.11.2018 (Anx-16), whereby the appeal filed by the petitioner being Appeal Case No. 06/2017 has been dismissed on non-est and perverse grounds by respondent no. 2.
ii. To issue an appropriate writ/order/direction in the nature of Certiorari quashing the order dated 31.03.2016 (Anx-8) whereby the allotment of Industrial Plot No. NS11 at Patliputra Industrial Area, Patna, has been cancelled and also the order dated 27.12.2016 (Anx-12) affirming the said cancellation.
iii. To issue an appropriate writ /order/direction in the nature of Mandamus directing the Respondents not to take any coercive action against the petitioner's plot.
iv. To issue an appropriate writ /order/direction in the nature of Mandamus directing the respondents to allow the petitioner to run his unit without any hindrance.
v. To stay the operation of the order dated 20.11.2018 as contained in memo no. 5195 dated 22.11.2018 (Anx-16) till the final disposal of the present writ petition.
vi. To any other relief(s) that the petitioner is entitled to in the facts and circumstances of the case.
4. The petitioner is a company duly incorporated under the provisions of the Indian Companies Act, 1956. Petitioner is operating a factory which was established in the year 2008 for the purpose of manufacturing milk, ghee, paneer, dahi, ice-cream and other milk related products. Petitioner's unit has a daily production capacity of 25000 liters of milk, in addition to production of milk products like ghee, paneer, butter and ice-cream. For this purpose, petitioner's unit was allotted an industrial plot bearing no. NS-11 admeasuring 24032 sq. ft. by the respondent no.4 at Patliputra Industrial Area, Patna under registered lease agreement dated 01.02.2008. The unit has also been financed by the banks in order to meet the capital requirement and is running successfully till date.
5. Suddenly in the month of August, 2015, the petitioner received a notice dated 27.08.2015, whereby an explanation was sought from him within a period of 30 days in connection with alleged inspection as done in the premises of the petitioner with a finding of no production activity visible and also that there had taken place an illegal construction of two storied building. Pursuant thereto, the petitioner submitted a detailed explanation on 17.09.2015. On 10.12.2015, again final notice seeking explanation from the petitioner against the proposed cancellation of allotment was issued. Thereafter, the petitioner personally met the respondent nos. 5 and 6, pursuant to the show cause notice dated 10.12.2015 and persuaded them to explain the cause behind frequent notices for proposed cancellation of allotment for alleged violation of the Rules and conditions for allotment of plots by BIADA. On 28.01.2016, petitioner received a letter issued by the Area In-charge of the Industrial Area to stop operation of the retail outlet in the name and style of 'Doodh Malai'. Vide letter dated 04.03.2016, the petitioner submitted a detailed explanation to respondent no.6. In response to the show cause notice dated 10.12.2015, the petitioner rebutted all the allegations and informed about the status of various incentives being made available to him from different governmental sources. Respondent no. 5 vide his order dated 31.03.2016, proceeded to cancel the allotment of the petitioner with forfeiture of the security deposit and directed restorati
The court upheld the cancellation of land allotment due to the petitioner's non-utilization for over twenty years, reinforcing authority's jurisdiction under the BIADA Act, 1974 and its amendments.
Failure to utilize allocated industrial land justifies its cancellation under statutory provisions.
The court emphasized that passing of an order of cancellation of allotment was not mandatory on violation of the conditions of allotment letters, and that the petitioner's substantial compliance with....
Non-compliance with lease conditions and non-utilization of allotted land can justify the cancellation of the lease by the authority.
Compliance with the provisions of Sub-section 2 of Section 6 of the Bihar Industrial Area Development Authority Act, 1974 is essential in the cancellation of plot allotments by the authority.
Compliance with undertaking and consequences of breaching it are crucial in the disposal of the petition.
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