ASHOKA HOSIERY Vs. STATE OF HARYANA

JUDGEMENT

(1.) This order shall dispose of four connected Letters Patent Appeals bearing Nos. 631 to 633 and 652 of 1993 as common questions of law and facts arise in all these appeals. The appeals have been filed under Clause X of the Letters Patent Act No. 1891 against the order dated 20th December, 1991 passed by Amajeet Chaudhary, J. who likewise disposed of Civil Writ Petitions giving rise to the Letters Patent Appeals along with some other petitions by a common judgment. The facts have, however, been extracted from Letters Patent Appeal No. 631 of 1993 titled M/s. Ashoka Hosiery v. State of Haryana.

(2.) The appellant was allotted plot bearing No. H-49 situated in Industrial Area, Panipat. The case of the appellant as pleaded in the Writ Petition was that it was assured that the possession of plot would be delivered to it immediately after allotment of plot but possession was delivered only on 22nd March, 1979. It paid the entire sale consideration by way of installments and the sale deed / conveyance deed was registered in its favour on 30th March, 1979, copy of which is placed on record as Annexure P-1. It was further the case of the appellant that an assurance was held out to it by the respondents that it would be provided with the financial help through the financial institutions but no such steps were ever taken and the application of the appellant for grant of loan remained pending without any decision taken thereon. Even the plan submitted by the appellant for construction to, the Municipal Committee was not approved. Meanwhile, on 26th February, 1981, appellant received a show-cause notice from the Additional Director of Industries, Haryana as to why the plot allotted to it do not resume as the appellant had not taken any effective steps for the construction of the factory building on the plot allotted to it. The appellant made representation to respondent No. 2 in which it was explained that the delay in raising construction was due to the fact that the plan had not been approved by the Municipal Committee, Panipat. The explanation furnished by the appellant did not find favour with respondent No. 2 resulting into resumption of plot vide order dated 20th November, 1981. Being aggrieved, petitioner along with other manufacturers met the then Chief Minister on 12th October, 1982. In the meeting aforesaid it was decided that the appellant shall be restored the plot on his furnishing affidavit to the effect that he would start construction of the factory building by January, 1983 and would start industrial production by July, 1983. The case of the appellant is that it immediately started construction of the factory building and built a shed and a room for office and started manufacturing hosiery goods by the beginning of 1983. Information was given to respondent No. 2 that not only it has built a shed and a room for office which was sufficient for carrying on its industrial activity but, in fact, the factory was manufacturing hosiery goods. Consequent upon information conveyed to respondent No. 2, the order of resumption passed earlier was withdrawn, information whereof was given to the appellant vide letter dated 15th March, 1983. It is further the case of the appellant that on account of non-sanctioning of the loan from the financial institutions that was promised to it at the time of allotment of plot, it had no choice but to temporarily stop production. The appellant suffered huge losses due to non-availability of material at Panipat as also other facilities for manufacturing hosiery goods which too contributed to its temporary closure. Respondent No. 2 on 27th March, 1987 addressed a letter to the appellant asking it to seek an extension for one year to construct building to the minimum 40 percent area of plot and start industrial activity on depositing of non-refundable fee of Rs. 4/- per square meter of plot within 15 days. The appellant responded to this letter by explaining that he had been carrying on business activities from 1983 to 1986 regularly but because of non-availability of facilities he had suffered losses and for that reason had temporarily suspended the manufacturing activities. This explanation furnished by the appellant did not find favour with respondent No. 2 who again served a show cause notice to the appellant as to why the plot be not resumed as he has committed breach of terms and conditions of the conveyance deed by not constructing the building as also not starting of the production as undertaken by it by an affidavit at the time when order of resumption passed for the first time was recalled. The case of the appellant is that it reiterated the reasons for temporarily stopping the production but in spite of that respondent No. 2 cancelled the allotment of plot made in favour of the appellant on 17th December, 1974, vide letter dated 30th September, 1987. It is this order and aftermath thereof i.e. letter vide which respondent No. 2 required the appellant to handover the vacant possession that was challenged by the appellant vide Civil Writ Petition bearing No. 8352 of 1987. The writ petition came up for final hearing before the learned single Judge of this Court and vide order dated 20th December, 1991 was dismissed leaving it open to the appellant to take up the issues before the Civil Court, the rights of parties inter se being governed by terms of contract and not by statutory provisions. It is this order of the learned single Judge which has been challenged by the appellant through present Letters Patent Appeal.

(3.) Before the contentions raised by the learned Counsel for the appellant are noticed, it would be useful to briefly mention the stand projected in the written statement filed on behalf of the respondents. By way of Preliminary Objection it is pleaded that the appellant is estopped by his own act and conduct from filing and maintaining the petition as the industrial plot was allotted to it on 17th December, 1974 and the possession whereof was delivered on 22nd March, 1979. Since the date of possession it has not taken any steps to establish the industry as agreed to at the time of allotment. The allottee cannot be allowed to take the benefit of his own wrong. It is further pleaded that the appellant had taken no steps whatsoever to establish the industry and had no intention to install the unit and only constructed one shed 30'x 16' on the plot measuring 1000 sq. yards and the constructed area was only 53 sq. yards i.e. 5 per cent of the total area and if the allottee is allowed to retain the plot, the very purpose of the scheme would be forfeited. On merits, but for admitting that order of resumption passed for the first time was restored on specific undertaken given by the appellant that the construction shall be made and production started within the stipulated period, the other averments as noticed above have been denied. It is pleaded that no assurance was ever given to the allottee for providing any financial help by the financial institutions and it is for the entrepreneur to secure bank finances. However, the department being a promotional agency arranged a meeting of plot holders on 26th April, 1983 with the financial institutions for getting them financial assistance where it was agreed that loan cases can be sanctioned by the financial institutions subject to the completion of documents. The loan of Rs.1,25,000/- as term loan and cash credit limit was sanctioned by the Punjab National Bank on 23rd April, 1983. After the plot was restored to the appellant, General Manager, District Industries Centre, Panipat reported on 5th January; 1984 that the appellant-firm has constructed one shed measuring 30' x 16' and installed two flat machines. It was also reported that building was not completed according to the real plan. The appellant did not furnish any proof with regard to industrial production and as such contravened the provisions of sale deed and that of the affidavit. A registered show cause notice dated lst March, 1984 was served upon the appellant. Meanwhile, General Manager, District Industries Centre, Panipat vide letter dated 23rd December, 1986 wrote to the Director of Industries that the unit had been found locked on repeated visits and no industrial activities were being carried out in the premises. No reply to the show cause notice was received and that being so, another show cause notice dated 27th March, 1987 was served upon the appellant. The appellant did not respond to this show cause notice as well. Meanwhile, the Haryana Government formulated a lenient policy for transfer, allotment, resumption and other matters of industrial plots and according to this policy another opportunity was granted to the appellant to seek extension for completion of factory building as well as to start the industrial activities by depositing the prescribed extension fee. The appellant did not even respond to this notice and finally on 6th September, 1987 the allotment of plot in favour of the appellant was cancelled. On the facts as detailed above, learned single Judge held that the writ petition deserves to be dismissed as the rights of parties inter se are governed by terms of contract and not by statutory provisions and in the case in hand, there was contractual obligation on the appellant which he had failed to comply with. It was also held that disputed questions of facts could not be gone into in writ jurisdiction.