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K. VINOD CHANDRAN, HARISH KUMAR
Peerage Industries Pvt. Ltd. – Appellant
Versus
State of Bihar – Respondent
K. Vinod Chandran, CJ. – The above writ petition and appeal is concerned with a plot of land bearing Plot No. B-20 and B-21 admeasuring 32670sq.ft./43560 sq.ft. within the industrial area, Hajipur. The land was acquired for the purpose of industrialization and is in the possession and ownership of the 4th respondent, the Bihar Industrial Area Development Authority, (for brevity, the ‘BIADA’). The allotment of the land, its mortgage and the eventual cancellation as also the further allotment and its cancellation are respectively challenged in the appeal and the writ petition. We first take up the appeal insofar as the same being first in point of time and also dealing with the first allotment made of the said land.
2. The appeal is filed by the BIADA from the order of the learned Single Judge in a writ petition filed by the State Bank of India, (for brevity, the ‘SBI’). The Bank had accepted mortgage of the land allotted by the BIADA to one M/s Vaishali Mineral Water Pvt. Ltd., the 3rd respondent in the writ petition. The Bank, based on allotment of a plot of land to the 3rd respondent, sanctioned a loan based on the lease deed dated 03.12.2001, produced as Annexure-1 after accepting
Failure to utilize allocated industrial land justifies its cancellation under statutory provisions.
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.
The court ruled that allotment cancellation for non-payment is valid without prior notice, as applicable law requires notice only post-lease execution, which was not applicable here.
The court established the principle that the terms and conditions of an allotment order/lease deed must be adhered to, and the authority has the power to cancel the lease deed in case of violation.
Non-compliance with payment schedules in allotment agreements leads to automatic cancellation of rights to the property.
Non-compliance with lease conditions and non-utilization of allotted land can justify the cancellation of the lease by the authority.
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