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2013 Supreme(Online)(SC) 73

SUPREME COURT
*Dr. B. S. Chauhan, V. Gopala Gowda, JJ.
Rajasthan State Industrial Development and Investment Corporation – Appellant
Versus
Diamond and Gem Development Corporation Ltd. – Respondent
Civil Appeal Nos. 7252-53/2003 | Civil Writ Petition Nos. 5481/1994 | 105/1997



Advocates:
For the Appellants/Petitioners: Shri Dhruv Mehta, Shri Manish Singhvi
For the Respondents: Shri P.S. Patwalia

The court affirmed that a party cannot use writ jurisdiction to enforce contractual obligations, which must instead be pursued through appropriate civil or arbitration channels.

Headnote:(A) Rajasthan Land Acquisition Act, 1953 - Sections 4(1) and 6 - Rajasthan Land Revenue (Industrial Area Allotment) Rules, 1959 - Rule 11-A - Lease of land on "as is - where - is" basis - Appeals challenging High Court's order that quashed cancellation of lease and directed provision of approach road - Court ruled that respondent failed to comply with terms of lease, warranting cancellation - High Court misinterpreted amendments, leading to erroneous conclusions. (Paras 2, 12, 18, 32)

(B) Contractual obligations - Writ jurisdiction cannot be invoked to enforce contractual terms - If contractual rights exist, they must be asserted in civil or arbitration proceedings, not by writ petitions. (Paras 12, 32)

(C) Interpretation of contracts - Courts must interpret agreements strictly; parties are bound by their explicit terms without judicial alterations. (Paras 16, 32)

Facts of the case:
Appeals arose from a High Court ruling that overturned the cancellation of a lease issued to a company for land development, failing to meet project completion timelines. Appellant argued lease termination was justified due to non-compliance with stipulated conditions in the lease deed. (Paras 2, 26)

Findings of Court:
High Court's decision to restore possession and order the provision of an access road was held erroneous, violating terms of the lease. (Paras 26, 32)

Issues: Whether the cancellation of lease by appellant was justified under the contractual agreements and rules. (Paras 12, 32)

Ratio Decidendi: The Court held the High Court misapplied the statutory provisions related to lease agreements, affirming that the terms of the lease allowed for cancellation due to construction delays and lack of compliance observed by the respondent. (Paras 12, 32)

Result: Appeals allowed; High Court's order set aside, restoring the cancellation of allotment in favor of the company.

Table of Content
1. facts relating to land allotment and legal background. (Para 1 , 2)
2. appellant’s argument regarding lease terms. (Para 3)
3. respondent's claim on equitable grounds. (Para 4)
4. court's findings on contractual obligations and interpretations. (Para 5 , 9 , 10 , 11 , 12 , 13 , 14 , 16 , 17 , 18 , 20 , 21 , 22 , 24 , 26 , 27 , 28 , 29 , 30 , 31)
5. final decision and order restoration. (Para 32)

1. These appeals have been preferred against the impugned judgment and order dated 30.7.2002 passed by the High Court of Rajasthan (Jaipur Bench) in Civil Writ Petition Nos. 5481/1994 and 105/1997, by which the High Court has allowed the writ petitions filed by the respondent - Diamond and Gem Development Corporation Ltd. (hereinafter referred to as the 'Company'), for quashing the order of cancellation of allotment of land and directing the appellants for providing the approach / access road.

2. As these appeals have been preferred against the common impugned judgment, for the sake of convenience, Civil Appeal Nos. 7252-53/2003 are to be taken to be the leading case. The facts and circumstances giving rise to these appeals are :
A. That a huge area of land admeasuring 607 Bighas and 5 Biswas situate in the revenue estate of villages Durgapura, Jhalan Chod, Sanganer and Dhol - ka - Bad in District Jaipur, stood notified under S.4(1) of the Rajasthan Land Acquisition Act , 1953 (hereinafter referred to as the 'Act') on 18.7.1979, for a public purpose i.e. industrial development, to be executed by the appellant Rajasthan State Industrial Development and Investment Corporation (in short 'RIICO').
B. Declaration under S.6 of the Act was made on 22.6.1982 for the land admeasuring 591 Bighas and 17 Biswas. After meeting all requisite statutory requirements contained in the Act, possession of the land, was taken over by the Government and was subsequently handed over to appellant - RIICO, on 18.10.1982 and 17.11.1983. The Land Acquisition Collector assessed the market value of the land and made an award on 14.5.1984. RIICO made allotment of land admeasuring 105 acres vide allotment letter dated 10.3.1988 to the respondent no.1 company, to facilitate the establishment of a Gem Industrial Estate for the manufacturing of Gem stones.
C. In pursuance of the aforesaid allotment letter, a lease deed was executed between the appellant and respondent - company on 22.5.1989, with a clear stipulation that the land was allotted on an "as is - where - is", and that the respondent - company must complete the said project within a period of 5 years, and further that, in the event that the terms and conditions of the lease agreement were not complied with, the appellant would be entitled to recover its possession in addition to which, various other conditions were also incorporated therein.
D. After possession was taken by the respondent - company, construction could be carried only on a portion of the land allotted to it. As the development work was being carried out at an extremely slow pace, the appellant issued various notices from time to time, reminding the respondent - company that it was under an obligation to complete the project within a specified period, owing to which, it must accelerate work. Additionally, there also arose some difficulty with respect to the respondent - company's attempts to sub-lease the said premises, or parts thereof, and in view of this, an amendment dated 4.11.1991 was inserted in R.11 - A of the Rajasthan Land Revenue (Industrial area Allotment) Rules, 1959 (hereinafter referred to as the 'Rules, 1959'), enabling the company to sub-lease the said land.
E. The appellant vide notice dated 4.7.1992, informed the respondent - company, that as per clause 2(n) of the lease deed, all construction had to be completed within a stipulated time period of 5 years. The respondent - company began asking the appellant to provide it accessibility via road, from the Jaipur Tonk main road and, as the same was not provided, th


































































































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