LAKSHMI METALLURGY LIMITED Vs. GOVT OF ANDHRA PRADESH

JUDGEMENT

(1.) This writ petition is filed under Article 226 of the Constitution of India for the following relief:

(2.) Brief facts of the case are that the Petitioner made an application to the 2nd respondent seeking allotment of land for setting up "Ferro Alloys Industry" ('Project'). The application was forwarded to the 4thRespondent for necessary action. The final allotment order was issued by the 4thRespondent confirming the allotment of Plot No's. 67 and 69 to 73 at Industrial Park, Gajulamandyam in favor of the petitioner for Rs.1,53,52,800.00. An Agreement of Sale was also entered into and Pursuant to the Agreement, possession certificate was issued. Petitioner without wasting any time, with great diligence started development work on the subject land but it took more than two and half years to get the statutory approvals. Pursuant to obtaining approval almost 70% of the building works on the subject land was completed. It is stated that the APSPDCL issued a revised estimate to the petitioner for supplying electricity to the subject land. The petitioner applied for credit facilities from financial institutions and with great difficulty convinced ICICI Bank to advance credit facilities of Rs.14.00 Crore. Amount was sanctioned subject to issuance of NOC from 4thRespondent. Pursuant thereto, the petitioner requesting the 4th Respondent for grant of No objection Certificate (NOC) under clause 4 (a) of Agreement. The 4th Respondent neither granted the NOC nor replied to the communications issued by the Petitioner on numerous occasions. Accordingly, the petitioner sought for extension of time as commercial production could not be commenced within two years. The 4th Respondent extended the time till 30/11/2014 but penalty of Rs.19,34,453.00 was levied. Petitioner requested the for waiver of the penalty and further requested for issuance of NOC to ICICI Bank. It is further stated that Multiple Letters were sent as NOC was not granted even after lapse of a year. Finally the 4th Respondent waived penalty and granted NOC to ICICI Bank after fourteen months. Owing to the delay, bank withdrew its decision to sanction loan and the NOC was returned. In view of the same, the petitioner suffered loss of Rs.24,50,000.00 paid as processing fee to bank. Due to delay caused in issuance of NOC, further extension of time for 15 months was sought. But surprisingly show cause notice was issued seeking reason for not cancelling the allotment. Thereafter, the petitioner issued reply explaining the reasons for delay. An additional reply with supporting documents was also issued. The Petitioner requested for issuance of NOC to Canara Bank for loan. But the Respondents did not respond and the Petitioner's request for grant of NOC was rejected as project not implemented within stipulated time. Thereafter, detailed Representations were sent by petitioner explaining the cause of delay and the investments made and sought for final extension of one year with NOC. Even though Valuation certificates to the tune of 20 crore and photographs showing 80% work completion were also sent, the allotment of land made to the Petitioner was cancelled. Further, the 4th Respondent also sought to cancel the Agreement of Sale and forfeit the EMD amount and requested the Petitioner to surrender the subject land within fifteen days. Aggrieved by the same, the petitioner filed WP 8322/2016 before the High Court and this Court has granted Interim suspension orders. It is also stated that the 2nd Respondent was requested for EOT & NOC. Certain conditions were put forth by Respondents for grant of EOT & NOC. Later, the Petitioner remitted Rs.5,00,000.00 towards penalty. But respondents insisted payment of entire amount in single payment. Multiple Requests were made for payment in installments. But demand for single payment was reiterated. Accordingly, the Petitioner paid the full penalty amount and requested for NOC to Union Bank for loan. But the amount was returned as WP was not withdrawn. It is further stated that the Petitioner undertook to withdraw the WP on receipt of NOC with sanction of 12 months EOT. Occupancy Certificate was also sought for. The Respondent informed that the above would be subject to withdrawal of WP etc., Thereafter, steps have been taken for withdrawal of the writ petition and the same was informed to the Respondent. The conditions for grant of NOC etc were fulfilled by the petitioner and the DD's were accepted by Respondent, but further amount of Rs.5,62,312.00 and memo filed for withdrawal was demanded. Penalty of Rs.88,171.00 was remitted. Withdrawal memo was sent reiterating request for NOC and EOT for one year. Even though the Petitioner sent multiple letters detailing the various timelines and efforts made by the Petitioner to implement the project, no steps have been taken by the respondents. Hence, the present writ petition.

(3.) The counter affidavit has been filed by the respondents No.2 to 4. While denying the allegations made in the petition, inter alia, contended that, the petitioner with mala fide intention has not fulfilled the conditions of the EOT granted, further in order to delay the project, the petitioner vide Letter dtd. 19/7/2016 has submitted Demand Draft for Rs.5,00,000.00. The same was not accepted by this office as the total EOT penalty which was Rs.34,39,027.00 + Service Tax @15% Rs.5.0015/854/- The DD worth Rs.5,00,000.00 was returned to the allottee vide Ietter dtd. 22/7/2016 and requested to pay the total amount. In order to further delay the petitioner vide Ietter dtd. 14/9/2016 has forwarded DD worth Rs.10,00,000.00 to head office towards EOT fee. Head office vide Ietter dt.9/2/2017 has returned the DD of Rs.10,00,000.00 and instructed to pay the total EOT penalty along with applicable tax and the petitioner has not taken any steps in fulfilling the conditions of APIIC letter dtd. 17/5/2016. This shows the petitioner has been intentionally delaying the project and has no interest in implementing the project and the seeking of NOC is being used to evade the cancellation and resumption. It is stated that the petitioner has not implemented the project inspite of elapse of substantial time and there also appears no intention to implement the project, and petitioner wants to withhold the land vacant and without any industrial activity merely as real estate and clearly violated the conditions imposed by APIIC vide letter dtd. 17/5/2016, i.e by not paying the penalty(intentionally wasted time in paying amounts in phased manner with a gap of 2 months in zonal office and 9 months in Head office from the date of consideration of EOT and NOC ie 17/5/2016 However the same was rejected by Zonal office and APIIC Head office as well and requested the petitioner to pay full amount along with applicable taxes. But after protracted correspondence, the allottee vide Lr.No.LML/APIIC/21/2017-18, Dt: 19/6/2017 has furnished DD. No.786477, Dt:17/5/2017 for Rs.39,84,881.00 to Head Office and the same has been accepted. It is further stated that penalty is payable on the current land rate of APIIC and hence in this case there is short payment of penalty due to revision of land rate from Rs.1,120.00 psm, to Rs.1,255.00 psm., w.e.f. 1/6/2017, the allottee has been requested for payment of balance penalty & GST amount vide reference 2ndcited. In reply, the allottee vide letter 3rd cited has stated that the present land rate of Rs.1255.00 per sq.mtr is not applicable, since they have paid full payment of the amount prior to 1/6/2017 and there is delay in acceptance of DD by APIIC. The allottee has requested for considering penalty on old land rate of Rs.1,120.00 per sq.mtr., ie, prevailing as on the date of the Demand Draft and furnished DD. No. 108433, dt:31 08.2017 for Rs.88,171.00 towards balance GST and legal expenses. The details of payments received from the allottee as follows: <IMG>JUDGEMENT_211_LAWS(APH)2_2025_1.jpg</IMG> It is further stated that the penalty has not been paid and as per the land rate of Rs.1,255.00 per sq.mtr. applicable w.e.f 1/6/2017, applicable by the date of payments by the petitioner still it is in due of difference penalty (i.e., Rs.38,53,553.00 Rs.34,39,027.00) along with GST @ 18%, which works to Rs.4,89,141.00 (Penalty Rs.4,14,526.00 GST Rs.74,615.00) thus it has not complied with the terms and conditions and now the petitioner has approached this Hon'ble Court stating only facts suiting itself. Thus, the allottee has requested for considering penalty @ 3% on land rate of Rs.1,120.00 per sq.mtr., prevailing upto 31/5/2017 instead of Rs.1,255.00 per sq.mtr revised wef.1/6/2017, duly stating that issue was long pending with the Corporation as they have submitted DDs towards payment of penalty & legal expenses to APIIC within the time but the same were returned by APIIC vide letter dt:5/6/2017 stating that the case is not withdrawn and also stated that since their Advocate expressed delay due to court vacations in May, the withdrawal issue was delayed which is not deliberate and hence they submitted an Affidavit for withdrawal of case in their letter dt. 19/6/2017 Further it is also to be noted that the petitioner filed court case which was disposed as withdrawn on 5/1/2018 which was a delay of nearly 8 months from the date of consideration of EOT and NOC by APIIC. The petitioner merely dragged the issue by making some DD to APIIC just to drag the matter and failed to pay the entire penalty and withdraw the case expeditiously though he had the option to submit withdrawal letter previously as per the EOT conditions as above stated. It is further stated that inspite of availing the opportunity given by APIIC for EOT & NOC, the petitioner has started continuously corresponding for execution of sale deed or issue of NOC without fulfilling the terms and conditions requested by APIIC. The grievance of the petitioner has been heard personally by the 2nd respondent and the 2nd respondent has inspected the premises on 7/7/2021 in the presence of the petitioner and the petitioner was also instructed to get the power connection and implement the unit as the petitioner has not even got power. But, inspite of taking action for implementation, the petitioner has filed this WP simply blaming APIIC for nothing. It is further stated that APIIC has always been encouraging the petitioner in implementing the project, but the petitioner failed to utilize the opportunities and now blaming APIIC for the delay is not correct.It is stated that the petitioner has been holding huge industrial lands idle and vacant thus adversely affecting the industrial development. The petitioner is therefore not entitled to any reliefs and the writ petition is not maintainable.