SURENDRAKUMARJABALPUR Vs. KUMARI LILAWATI VIOLET MANORAMA LAXMANANJABALPUR AND

JUDGEMENT

(1.) Plot No. 7/1 situated in South Civil Lines, Jabalpur, with a bungalow and outhouses belongs to Kum. Lilawati, respondent No, 1 in this petition. The entire area of the plot is 38,115, sq. ft. The area on which the constructions stand is 5,422 sq. ft. The petitioner entered into an agreement with Respondent No. 1 on 11th-September 1978 for purchase of 16,500 sq. ft. of land out of plot No. 7/1 including an area of 4,142 sq. ft. covered by the bungalow, garage and some outhouses for a consideration of Rs. 50.000/-. The petitioner and Respondent No. 1 both applied under Section 27 of the Urban Land (Ceiling and Regulation) Act, 1976 to the Competent Authority for permission for sale of the aforesaid property in accordance with the agreement dated 11th Sep. 1978. This application was made on 31st Oct. 1979. The Competent Authority on 29th Dec, 1979 exercised the option for purchase of the property on behalf of the State Government under Section 27 (5) (a) of the Act. A sale deed in pursuance of this option was executed on 16th May 1980 on behalf of respondent No. 1 in favour of the State Government. The petitioner by this petition under Article 226 of the Constitution prays that the option exercised by the Competent Authority and the sale deed executed by Respondent No. 1 in favour of the Government be quashed. It is further prayed that the respondents be directed to execute a sale deed in respect of the property in favour of the petitioner.

(2.) The first contention raised by the learned counsel for the petitioner is that the sale deed in favour of the State Government was ineffective as it was not executed within three months of the exercise of the option by the Competent Authority. Learned counsel in this connection relies upon the proviso to Section 27 (5), which enacts, that where the Competent Authority exercises the option, the execution of the sale deed shall be completed and the payment of the purchase price shall be made within a period of three months from the date on which such option is exercised. A perusal of Section 27 (5) goes to show that the option has to be exercised by the Competent Authority within sixty days from the date of receipt of the application for permission; and in case no option is exercised within this period, the owner becomes entitled to transfer the property to whomsoever he may like. The section thus in clear terms provides the consequence of not exercising the option within the period of sixty days. The consequence being that the option to purchase lapses after the expiry of this period. This section, however, nowhere provides as to what will happen when the option is exercised within sixty days from the date of receipt of the application for permission but no sale deed is executed within three months from the date of the option. Whatever may be the position, when sale deed is not executed and price is not paid within this period because of laches of the Government, we are clearly of opinion that if the delay is due to inaction of the owner in taking steps for completion of the sale deed, the option once exercised does not lapse and a sale deed executed even after three months from the date of the option remains valid. If the option which has been exercised and which confers on the State Government the right to purchase can be said to lapse even though the State Government has been throughout ready and willing to complete the sale within the statutory period of three months but the sale deed is not executed within this period because of inaction or negligence of the owner, it would be possible for the owner to bring about this result in every case whenever he wants not to sell the property to the Government. Such a construction will make Section 27 (5) wholly ineffective to serve the purpose for which it was enacted, i.e. to give the Government preferential right to purchase. The facts relevant on this point are that respondent No. 1 resides at Bombay. In proceedings before the Competent Authority she was represented by Advocate Shri V.R. Rao. The State was ready and willing to pay the price and complete the sale before 28th March 1980. The intimation that the Government was prepared to complete the sale and to pay the price was given to Shri Rao on 28th March 1980. The sale deed could not be executed within three months from the date of exercise of the option i.e. on or before 28th March 1980 for the reason that the power of Attorney came late in favour of Shri Rao authorising him to execute the sale deed. Now the delay in the instant case was not because of any negligence or lapse or default on the part of the State Government. The delay was solely because of the inaction of Respondent No. 1 in either not coming personally to execute the sale deed or in not giving the power of attorney in favour of Shri Rao earlier to complete the sale within the period of three months. In the circumstances, the Government was not responsible for the delay in execution of the sale deed. There was thus no question of the option lapsing and the sale being void on this ground.

(3.) The next contention raised by the learned counsel for the petitioner is that the application under Section 27 for permission to sell the property was made under a mistake and that in fact no application lay to the competent Authority for that purpose in respect of the property which the petitioner agreed to purchase from respondent No. 1. It is submitted that the law became clear on this point only after the decision of the Supreme Court in Bhim Singhji v. Union of India AIR 1981 SC 234 was pronounced that Section 27 is partly invalid. It is further contended that as the application under Section 27 was not maintainable there was no right in the Competent Authority to exercise the option to purchase the property and the sale deed executed in favour of the State Government was void.