2008 Supreme(All) 1160

[2008(5) ADJ 356 (DB)]
ALLAHABAD HIGH COURT
BEFORE : DR. B.S. CHAUHAN AND ARUN TANDON, JJ.
I.T.C. LTD. ...........Petitioners
Versus
STATE OF U.P. AND OTHERS ........Respondents
(Civil Misc. Writ Petition Nos. 37949, 37742, 37919, 38021, 38022, 38024, 38029, 38030, 38386, 38498, 38632, 38635, 42709 and 56831 of 2007, decided on 13th May, 2008)

Headnote:(A) Allotment—Cencellation of—Direction issued for identified the officers responsible—Hence, petition against, by petitioners-Companies—Held, impugned orders passed by State Government, and consequential order passed by NOIDA being in violation of principles of natural justice, cannot be legally sustained, quashed and set aside—Since time is of essence, inasmuch as lease-deeds contain stipulations, whereunder constructions have to be made in a time-bound manner, State Government directed to take appropriate action, after affording opportunity of hearing to petitioners—And decision so taken by State Government, would record reasons—And would be communicated to NOIDA, which would take all consequential actions thereon—Matter remanded to State Government for taking a fresh decision in accordance with law. [U.P. Urban Planning and Development Act, 1973—Sections 30, 32, 40 to 47, 49 to 51, 53 and 58—U.P. Industrial Area Development Act, 1976—Sections 7, 12, 14, 17, 18, 19, 6(b), 6(c), 9, 14, 8 and 15—Constitution of India—Article 300-A]. [Paras 1 and 138]

       (B) Public Trust—Doctrine of trust and duty to act, fairly and reasonably—State, or public authority, which holds property for public, or which has been assigned duty of grant of largesse, etc., acts as a trustee—And, therefore, has to act fairly and reasonably. [Para 51(1)]

       (C) Promissory estoppel—Principle of—Has no application, in cases where there is violation of law—Nor the principles of estoppel can override the supervening public interest—Question of estoppel, does not arise against statute. [Paras 51(2)]

       (D) Words and phrases—"Reserve price”—Meaning of—It means price at which public auction starts; i.e., amount below which auction bidders are not permitted to start bid amount at auction. [Para 51(3)]

       (E) Rule of law—What is—Even discretion is to be exercised by Executive strictly in accordance with law—And action is to be free from arbitrariness and unreasonableness. [Para 51(4)]

       (F) Policy decisions—Whether has no statutory force—Held, do not have statutory force. [Paras 51(5)]

       (G) Allotment—Stringent conditions for allotment—Whether has effect of reducing fair price, which can be fetched—Where allotment of property is subject to some stringent conditions, its value is required to be assessed at a proportionately discounted rate—For reason that transferee does not have free hand to deal with property—Any deviation/violation of any of stringent conditions may be fatal. [Para 51(6)]

       (H) Property—State public owned property—Transfer of—Inviting tenders/auction—Whether not only mode for transfer for public State owned, or public owned property—Held, State/public owned property is to be transferred by inviting tenders, or by auction for receiving highest consideration—In exceptional circumstances, where policy-decision, public interest, economic policy, or development of a particular Industry, etc. so warrant, property may be settled, even by negotiation—However, State action should be reasonable, fair and in public interest—And onus to prove otherwise, is on person challenging State action as whimsical or unreasonable, unfair. [Para 51(8)]

       (I) Trespasser—Right to property—Whether even trespasser has a right, not to be thrown out of possession forcibly—Held, even a trespasser could not be removed, without following procedure, prescribed by law—State authorities also cannot dispossess a person by an Executive order—Authorities cannot become law unto themselves—And it would be in violation of rule of law—Government can resume possession only in a manner, known to, or recognised by law, and not otherwise. [Para 51(10)]

       (K) Constitution of India, 1950—Article 300-A—Scope and applicability of—Held, “Law” within meaning of Article 300-A would mean a Parliamentary Act, or an Act of State Legislature, or a statutory order, having force of law—Thus, it does not include Executive order. [Paras 51(10)]

       (L) Policy-decision—Change of policy with change of Government—Whether permissible—Held, unless it is found that act done by authority earlier in existence, is contrary to statutory provision or unreasonable, or against public interest, State should not change its stand merely because other political party has come into power. [Para 51(11)]