2021 Supreme(Raj) 653

IN THE HIGH COURT OF RAJASTHAN AT JAIPUR BENCH
Indrajit Mahanty,Satish Kumar Sharma, JJ.
Arfat Petrochemicals Private Limited & Ors. - Appellants
Versus
State Of Rajasthan & Ors. - Respondents
D.B. Civil Writ Petition No. 3410/2020
Decided on : 20-07-2021

The State Government has the power to issue appropriate directions under Article 138 of the Articles of Association of RIICO to manage the affairs of the RIICO, but such power cannot be used to direct the RIICO to straightaway cancel the lease deeds, permissions/approvals granted by it in favour of the third party without adopting the procedure prescribed under the Rules of 1979 and other prevalent Rules.

Headnote:

RIICO - Scope of authority of State Government over RIICO - Rajasthan State Industrial Development and Investment Corporation (RIICO) - Article 138 of its Articles of Association - Challenge to the decision of the Cabinet Committee of the State Government to review the decisions taken by the previous Government in the last six months - Cancellation of permissions/approvals granted to the petitioner-company by RIICO - Maintainability of the petition - Scope of power of the State Government under Article 138 of the Articles of Association of RIICO - Validity of the impugned orders - Principles of promissory estoppel and legitimate expectation - Applicability against the State Government - Cancellation of lease deeds and permissions/approvals granted to the petitioner-company - Quashing and setting aside of the impugned orders - Declaration regarding the scope of power of the State Government under Article 138 of the Articles of Association of RIICO.

Fact of the Case:

Petitioner-company challenged the decision of the Cabinet Committee of the State Government to review the decisions taken by the previous Government in the last six months and consequential orders issued pursuant thereto, whereby the permissions/approvals granted to the petitioner-company by RIICO have been cancelled. The petitioner-company made an application before the District Collector, Kota for clearance to develop affordable housing scheme on the lease land under Chief Minister Jan Aavas Yojana (CMJAY) scheme. Correspondence in this regard was also made between the District Collector and RIICO but it could not get the desired clearance. Thereafter, the petitioner-company submitted proposals for sub-division and change of land use of the subject land for commercial and institutional use from industrial use in a phased manner under RIICO Disposal of Land Rules, 1979 (Rules of 1979). The proposals of the petitioner-company was accepted by the Land Planning Committee (LPC) and approved by the Infrastructure Development Committee (IDC). The petitioner-company deposited a total sum of Rs. 5,21,61,276/- with the RIICO as its application fees, sub-division charges, transfer of strip land, economic rent, service charges, commercial conversion charges interest and GST. On fulfillment of all the formalities, the RIICO executed necessary supplementary lease deeds and issued the required permissions/approvals in favour of the petitioner-company. The State Government vide order dated 01.01.2019, constituted a Cabinet Committee to review the decisions taken by the previous Government in the last six months. The Cabinet Committee, vide its decision dated 03.08.2019 with respect to the permissions/approvals granted to the petitioner-company directed that the permissions/approvals granted to the petitioner-company be cancelled. In pursuance thereto, the State Government vide its order dated 10.10.2019, in exercise of its powers under Article 138 of the Articles of Association of RIICO issued directions to the RIICO to cancel all permissions/approvals granted to the petitioner-company. In compliance, the RIICO issued orders dated 11.10.2019 and 14.10.2019 for cancellation and withdrawal of the permissions/approvals granted to the petitioner-company.

Finding of the Court:

The impugned orders cancelling the lease deeds and permissions/approvals granted to the petitioner-company are liable to be quashed and set aside with the appropriate declaration regarding the scope of power of the State Government under Article 138 of the Articles of Association of the RIICO.

Issues: 1. Whether the petition is maintainable? 2. Whether the State Government has the power to issue appropriate directions under Article 138 of the Articles of Association of RIICO to manage the affairs of the RIICO? 3. Whether such power can be used to direct the RIICO to straightaway cancel the lease deeds, permissions/approvals granted by it in favour of the third party without adopting the procedure prescribed under the Rules of 1979 and other prevalent Rules?

Ratio Decidendi: 1. The petition is maintainable as every citizen is entitled to approach the Court under Article 226 of the Constitution of India for protection of his/her fundamental rights or statutory rights. 2. The State Government has the power to issue appropriate directions under Article 138 of the Articles of Association of RIICO to manage the affairs of the RIICO, but such power cannot be used to direct the RIICO to straightaway cancel the lease deeds, permissions/approvals granted by it in favour of the third party without adopting the procedure prescribed under the Rules of 1979 and other prevalent Rules.

Final Decision: The petition is allowed. The decision of the Cabinet Committee constituted to review the decisions taken by the previous Government in the last six months, taken in its meeting dated 03.08.2019 and the Order of the State Government dated 10.10.2019 issued pursuant thereto and the Orders dated 22.07.2019, 25.07.2019, 11.10.2019 & 14.10.2019, issued by the RIICO and all subsequent orders are quashed and set aside whereby the lease deeds and permissions/approvals already granted to the petitioner-company have been cancelled. The petitioner-company shall be entitled to act upon in terms of approvals/permissions granted to it by the RIICO. The Show Cause Notice dated 27.11.2020 issued by the District Collector, Kota to the petitioner-company for cancellation of lease deed against the interim directions of this Court, is hereby quashed and set aside. The applications for impleadment filed by the labour unions are dismissed.