LAL CHAND Vs. CHANDIGARH ADMINISTRATION

JUDGEMENT

(1.) In this petition under Articles 226 and 227 of the Constitution, the point involved is very short, that is, as to whether the Chandigarh Administration can cancel the allotment of a site if the allottee has failed to abide by the terms and conditions of allotment and there being no clause in the agreement empowering the authorities to forfeit the earnest money deposited by the allottee, can the earnest money be forfeited as a consequence of cancellation of allotment and resumption of site.

(2.) Briefly stated, the Notified Area Committee, Manimajra, in the Union Territory, Chandigarh, allotted two Shop-cumFlats bearing Nos. 24 and 26 (commercial sites), on free-hold basis in the Motor Market and Commercial Complex at Manimajra, in 1977, in favour of the petitioners. The petitioners had already deposited a sum of Rs. 2,000.00 each as earnest money along with the application for allotment. But instead of paying the balance, they approached this Court in 1977 by way of C.W.P. No. 3553 of 1977 and got stay of recovery of further instalments beyond 25 per cent. In the said writ petition, the petitioners had pleaded that as the respondent-Notified Area Committee, Manimajra, had failed to develop the area, the petitioners were not obliged to take possession of the sites in dispute and complete construction thereon within the stipulated period. In reply thereto, the respondents had stated that the Motor Market and Commercial Complex had been fully developed and roads had been constructed, water pipes had been laid and sewerage and drainage had been provided. Consequently, the writ petition was dismissed by S. S. Sandhawalia, C.J., as his Lordship then was, on 13/07/1979. However, his Lordship taking a compassionate view of the matter, granted a period of one year from the date of the judgment to the petitioners to complete the construction. Thereafter, the Notified Area Committee, Manimajra, issued a number of notices to the petitioners requiring them to deposit the instalments within the stipulated period failing which the allotment of sites would be cancelled and the plots resumed, besides forfeiting the amount already deposited. Despite this nothing was done by the petitioners and ultimately on 24th Oct. 1979, the allotment of the sites in dispute was cancelled in accordance with the terms and conditions of allotment as the petitioners failed to comply with the terms of the notice served on them on 5th Sept., 1979, and the earnest money deposited earlier was forfeited. Aggrieved against this order, the petitioner have approached this Court by way of the present writ petition challenging the cancellation of allotment and resumption of plots as also forfeiture of the earnest money deposited by them, mainly on the ground that the respondents had no jurisdiction to cancel allotment and resume the plots, much less to forfeit the earnest money, for breach of the terms and conditions of the allotment.

(3.) In reply, the respondents have pleaded that the principle of constructive res judicata was attracted in the case and otherwise also the matter in dispute being purely contractual, the writ petition under Art. 226 of the Constitution was not maintainable.