Aneesa Ahmed vs Mysore Urban Development Authority

Ram Mohan Reddy, J.—The petitioner''s vendor, amongst others was allotted a residential house in the High income Group (HIG) category, in III Stage, Devanur Extension, Mysore, under the HUDCO scheme, by the respondent-Mysore Urban Development Authority (for short ''MUDA''). The initial cost of the building was Rs. 3 lakhs and on completion of the construction, the MUDA escalated the cost by Rs. 96,200/-, which when demanded was made over by the petitioner''s vendor. It appears that some of the allottees aggrieved by the demand for the escalated cost invoked the writ jurisdiction of this Court in W.P. Nos. 28138/2000 and 30266/2000 & connected petitions, whence, by orders dt. 5.12.2001 Annexures-G and H directed the authorities to extend an opportunity of hearing to the petitioners therein, calling upon them to pay the escalation charges and to conduct an enquiry and fix the cost of the building. The petitioner having purchased the property on 28.4.2003 approached the MUDA for execution of the sale deed, and when called upon to appear before the Secretary on 17.1.2005 by notice dt. 5.1.2005 Annexure-K, it is alleged, nothing transpired and no action was taken to execute the sale deed. Hence this petition for a writ of mandamus directing the respondent to execute the sale deed in respect of the property in question and in the alternative if the authority were to claim additional amount, direct it to hold an enquiry and pass orders, time bound, after issuing notice to the petitioner.

The petition is opposed by filing statement of objections dt. 25.5.2009 of the respondent-MUDA interalia admitting the fact that the property in question was allotted to the petitioner''s vendor, who had paid the escalation cost of Rs. 96,200/- on 25.2.1995, whence possession of the house was handed over on 28.2.1995. According to the respondent, lease-cum-sale agreement entered into between the allottee and itself on 8.3.1995 Annexure-R3, stipulated that Rs. 3,96,200/- being the cost of the building was tentative and dependant upon a final determination and therefore, the allottee was bound by the condition to pay the difference of price after final determination of the cost It is further stated that on the completion of the entire construction work, the authority authorised the Commissioner and other Officers of the authority to fix the final cost of the houses constructed and thereafter was determined by a Committee, taking into consideration the total cost of construction of 18 houses. The exercise, it is said, resulted in a demand for difference of cost of construction of Rs. 2,05,200/- by notice dt. 19.6.2000 Annexure-R4. It is the contention of the respondent that the petitioner''s application for issue of title deed resulted in a notice dt. 19.9.2002 calling upon the allottee to pay the difference of cost of Rs. 2,05,200/- whence the sale deed would be executed. The petitioner''s vendor without making payment of the said sum, is said to have executed a sale deed on 28.4.2003, in favour of the petitioner, who too, thereafter filed an application dt 10.5.2005 Annexure-P5 for issue of a title deed and clearance certificate.

In para 7 of the statement of objections, it is stated that similar demands for payment of escalation in cost in respect of other allotments, similarly situate, were subject matter of challenge in W.P. Nos. 28138/2000 and 30266/2000 & connected petitions, wherein this court by orders Annexures-G and H directed the authorities to extend an opportunity to the allottees before collecting the escalated cost It is further contended that pursuant to the directions, the matter when discussed in the meeting held on 20.7.2002, a resolution was passed to obtain suitable orders of the State Government in the matter, which was responded to by letter dt. 12.8.2003 of the State issuing certain directions over "recovery of the escalated cost and interest thereon". The authority is said to have placed the same in the meeting held ON 11.2.2009 and resolved to waive the interest on the escalated cost, wherever the allottee had paid the entire cost of construction and the difference of cost within the stipulated time as recorded in Annexure-R6. In addition, it is stated that pursuant thereto, some of the allottees agreed that if the authority waives the interest on the escalated cost, they were prepared to pay the principal cost and the difference of Rs. 2,05,200/-. The cost of construction of each of the 18 houses, according to the respondent MUDA, is Rs. 6,01,400/- and therefore, there is no illegality in the demand.

After having heard the learned counsel for the parties at length and perused the orders dt. 5.12.2001 Annexures-G and H of this Court in W.P. Nos. 28138/2000 and 30266/2000 & connected petitions, respectively, there can be no more doubt in my mind that the petitioner who was similarly circumstanced as the petitioners in the said writ petitions, was entitled to the similar benefit of the directions issued by this Court. If 17 ether allottees of similarly constructed buildings are entitled to an opportunity of hearing, it cannot but be said that the petitioner too is entitled to such an opportunity. It is elsewhere said State must act fairly in its business transactions and therefore, MUDA being a State for the purpose of Article 12 of the Constitution of India must exhibit and animate fairness in its transaction. It is in that view of the matter, the petitioner is entitled to an opportunity of being heard before the MUDA demands the payment of escalation charges, and in the manner as directed by this Court in the orders Annexures-G and H.

In the result, the petitioner though not entitled to the first relief, is entitled to the alternate relief sought for. A direction shall ensue to the respondent-MUDA to extend an opportunity of hearing to the petitioner before calling upon her to pay the escalation charges after furnishing the petitioner with all relevant particulars of the final fixing of cost of the building, in any event within a period of three months from the date of receipt of a certified copy of this order.