Important pointProviding of amenities is not a condition precedent to the payment of the interest and penalty as the case may be on the instalments in cases of allotment of sites.

Headnote:(i) Capital of Punjab (Development and Regulation) Act, 1952—Sections 2(b), 2(f), 2(i), 2(j), 2(k), 3, 5 to 8 and 22—Chandigarh Lease-Hold of Sites and Buildings Rules, 1973—Rules 3(2), 4 to 14—Amenities on allotment of site—Obligation to provide—As per terms of allotment upon payment of the 25 per cent, possession will be handed over and rest of the 75 per cent of leased amount to be paid in three annual equated instalments alongwith interest—It is never a condition precedent of the auction that all the facilities like road, water supply, street lighting, drainage, sewerage, public building, horticulture, landscaping shall be a condition precedent—Whether providing of amenities is a condition precedent to the payment of the interest and penalty—(No)—However, according to the provisions of the Act, the Administrator is under the obligation to provide the amenities—Matter is remitted to the High Court for a very limited purpose to see that in cases where facilities like kutcha road, drainage, drinking water, sewerage, street lighting have not been provided, the High Court may grant the allottees some proportionate relief.
       Held : It is true that once allotment of the land has been made in favour of the allottee, he can take possession of the property and use the same in accordance with the Rules. That does not mean that all the facilities should be provided first for so called enjoyment of the property this was not the condition of auction. Party knew the location & condition prevailing thereon. The interpretation given by the Division Bench of the High Court of Punjab & Haryana and contended before us cannot be accepted as a settled proposition of law. In the present case, as per the Act and the Rules it is never a condition precedent of the auction or as per the lease that all the facilities like, road, water-supply, street lighting, drainage, sewerage, public building, horticulture, landscaping shall be a condition precedent. (Para 15)
       It has been contended by the counsel for the Chandigarh Administration that all necessary facilities have been provided and some of the allottees have already constructed their buildings and have rented out the same and some allottees have applied for construction of Hotels also. It is not possible for us to examine all these facts individually. Some of the sectors have been fully developed and some sectors have been less developed. Therefore, it is not possible to work out that in one case it has been fully developed and in the other case it is still not developed. However, in some cases full payment has been made, in some cases two instalments have been made. Therefore, all these disputed facts have to be adequately dealt with by the High Court. We make it clear that though it was not a condition precedent but there is obligation on the part of the Administration to provide necessary facilities for full enjoyment of the same by the allottees. We therefore, remit the matter to the High Court for a very limited purpose to see that in cases where facilities like kutcha road, drainage, drinking water, sewerage, street lighting have not been provided, then in that case, the High Court may grant the allottees some proportionate relief. Therefore, we direct that all these cases be remitted to the High Court and the High Court may consider that in case where Kutcha road, drainage, sewerage, drinking water facilities have been provided, no relief shall be granted but in case, any of the facilities had not been provided, then the High Court may examine the same and consider grant of proportionate relief in the matter of payment of penalty under Rule 12(3) and delay in payment of equated instalment or ground rent or part thereof under Rule (12(3A) only. We repeat again that in case the above facilities had not been granted then in that case consider grant of proportionate relief and if the facilities have been provided then it will be the open on the part of the allottees to deny payment of interest and penalty. So far as payment of instalment is concerned, this is a part of the contract and therefore, the allottees are under obligation to pay the same. However, so far as the question of payment of penalty & penal interest is concerned, that shall depend on facts of each case to be examined by the High Court. The High Court shall examine each individual case and consider grant of the proportionate relief. (Para 22)
       (ii) Words and Phrases—Expression ‘amenities’—Meaning—Term ‘amenity’ in the context of real estate—It is for the better use of the allotted piece of land. (Para 15)
       (iii) Words and Phrases—Word ‘enjoy’—Meaning as per Webster’s Dictionary. (Para 15)

Judgment

A.K. Mathur, J.—Leave granted.

2. All these petitions involve common question of law, therefore, these are taken up together for disposal by the common judgment.

3. In all these petitions, there are two class of petitions, one filed by the private parties/individuals against the Division Bench judgment of the Punjab & Haryana High Court whereby the Division Bench has not given any relief following its judgment passed in CWP No. 13695 of 2001 dated 18.2.2002 [M/s. D.L.G. Builders Private Limited vs. The Advisor to the Administrator, Chandigarh Administration & Ors.]. The relevant portion of that judgment reads as under :

"In our considered view, the allottee is bound to pay the premium and other charges in accordance with the conditions of allotment. If the judgment of M/s. Shanti Kunj Investments Pvt. Ltd. (supra) is read as laying down a proposition that the allottee is not obliged to pay the balance of premium even after raising construction of the building and occupying it on the pretext that beautification of the site has not been done or land-scaping has not been provided or payment of the tiles has not been done, extremely anomalous consequences would follow inasmuch as, the allottee would construct building and utilize the same by renting out or otherwise and hereby reap huge benefits, but would not pay a single penny towards balance of premium and ground rent etc. Therefore, while examining the complaint of the allottee about the lack of amenities, what the Court is required to consider is whether the basic amenities, electricity, approach road, sewerage and drainage have been provided in the area so as to facilitate construction of the building within the specified time. If such amenities have been provided, the Court will not interdict in the matter and facilitate withholding of the balance of premium, ground rent etc. Rather, it would insist that all the dues of public money are paid by the allottee in accordance with the relevant rules/regulations and conditions of allotment."

Another class of cases in which the Municipal Corporation of Chandigarh and the Chandigarh Administration have filed the special leave petitions against the order passed by the Division Bench of the Punjab & Haryana High Court against the judgment dated 2.2.2002 passed in M/s. Shantikunj Investment Pvt. Ltd. and batch. Relevant portion of the judgment reads as under :

"They having failed to provide the basic amenities, the order of resumption and forfeiture cannot be sustained. The impugned orders are, consequently set aside. The respondents are directed to provide the amenities in accordance with law. The needful shall be done within three months. No interest shall be chargeable from the petitioners if they make the entire outstanding amount within three months from the date of the provision of the amenities."

4. It would not be proper to refer to all individual cases because various orders have been passed by the High Court from time to time but largely, the cases have been divided into two class of cases i.e. one governed by M/s. Shantikunj Investment Pvt. Ltd. and the other governed by M/s. D.L.G. Builders Private Limited. We are only deciding the question in principle and leaving the rest to be decided by the High Court.

5. In all these petitions, the common question is whether grant of the amenities is a condition precedent or not. All the plots in question were allotted by the Chandigarh Administration as well as the Municipal Corporation of Chandigarh on certain terms and conditions of the sale of residential and commercial sites & buildings by auction on lease for 99 years and certain terms and conditions were laid down therein. But the challenge in these various petitions filed before the Punjab & Haryana High Court was that the basic amenities were not provided and, therefore, the Chandigarh Administration and the Municipal Corporation of Chandigarh were not entitled to charge interest @ 18 or 10 , as the case may be, on the inst

Click Here to Read the rest of this document

2006 Supreme(SC) 190

Important pointProviding of amenities is not a condition precedent to the payment of the interest and penalty as the case may be on the instalments in cases of allotment of sites.

Cases Referred (10)