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Judgment
R. Banumathi, J.—Petitioners seek Writ of Certiorari to quash various Government Orders passed by the 1st Respondent cancelling the
allotment of Plots to Petitioners in Besant Nagar Scheme.
Since common questions of fact and law are involved in these Writ Petitions, all the Writ Petitions were taken up together and disposed of by
this common Order.
Brief facts which led to the filing of Writ Petitions are as follows:
(i) In Besant Nagar Housing Scheme, Public purpose site/School site was converted as residential Plots and divided into 20 house Plots [about 2
ground each] and allotted to the Petitioners under various Government Orders.
(ii) One Poochi S.Murugan filed W.P. Nos. 5499 to 5503/2006 to quash the allotments made by the Government and to sell the Plots by public
auction after due notification and wide publicity. By the order dated 26.4.2006, High Court has dismissed all those Writ Petitions filed by Poochi
S.Murugan. When there was change in the Government, Government reviewed the allotment scheme. Subsequently with an intention to give benefit
to more persons and to get more revenue to the Board, necessary proposals were sent to the Government to cancel the allotment already made so
as to reduce the size of the Plot to 2400 sq.ft. and to sell them through open auction. Accordingly, Government have issued the impugned orders
cancelling the allotment of 20 Plots to the Writ Petitioners.
(iii) Government have also directed to take immediate action to reduce the size of the Plot to 2400 sq.ft. and to sell them through open auction.
Government have further directed that opportunity should be given to the earlier allottees to participate in the open auction. Challenging the
cancellation of allotment of Plots under various Government Orders, Petitioners have filed these Writ Petitions.
Resisting the claim of Writ Petitioners, Respondents have filed counter stating that if the size of the Plots are reduced to one ground and sold
through open auction, the Board will get more revenue than the earlier proposal of allotting the Plots by fixing the cost of the Plots, based on the
market value or guideline value whichever is higher. Stand of the Respondents is that if the size of the Plots are reduced to one ground, more
number of people will be accommodated who are homeless and therefore, Government have decided to cancel the earlier allotment made under
various Government Orders.
On behalf of the Petitioners [W.P. Nos. 31831 to 31826/2006], the learned Senior Counsel Mr. K.M.Vijayan has submitted that excepting the
ground of change of Government, there seems to be no other reason to cancel the allotments earlier made. Laying emphasis upon the stand of
Respondents in W.P. No. 5499/2006 and batch, it was further argued that in the earlier W.P. No. 5499/2006 and batch, Respondents have taken
the stand that there would be no loss of revenue to the Government as the value of the Plot would be fixed either at the market value or at the
guideline value whichever is higher. It was further argued that the order in W.P. No. 5499/2006 and batch has become conclusive and the
impugned orders would amount to reviewing the Court''s order. It was further argued that in any event, cancellation of earlier orders of allotment is
violative of principles of natural justice.
Drawing Court''s attention to various allotments made under Government Discretionary Quota, onbehalf of the Petitioners [W.P. Nos. 31843 to
31847/2006], the learned Senior Counsel Mr. Vijay Narayan has submitted that normally such Government Discretionary Quota allotments are
being made and while so, after change of Government Petitioners'' allotment was unjustifiably cancelled. It was further argued that such selective
discrimination is a malafide exercise of power and such arbitrary exercise of power is liable to be quashed. Learned Senior Counsel would further
submit that having allotted the Plots to Petitioners, Government now cannot seek to withdraw the allotment and benefit conferred upon the
Petitioners.
Taking me through the Plan and the revised scheme, Mr. A.Masilamani, learned Advocate-General has submitted that but by mere allotment of
Plots, no vested right is conferred upon the Petitioners. Learned Advocate-General further submitted that keeping in view the place and price it
would fetch, it is for the Government to allot/revise and Government has power to cancel the allotment. Submitting that executive necessity inheres
powers of variation of the earlier allotment, learned Advocate-General has contended that Government and Tamil Nadu Housing Board has got
every right to change its policy and cancel the allotment. It was further argued that since there was no right accrued to the Petitioners, cancellation
of allotment involves no civil consequences and therefore, there was no need to give opportunity to the Petitioners.
I have given thoughtful consideration to the rival submissions. In cancellation of allotment of Plots whether there was arbitrary exercise of power
warranting interference exercising judicial review in the point falling for consideration.
Tamil Nadu Housing Board [TNHB] had developed a neighbourhood scheme in South Chennai in over an extent of 420 Acres which was later
named as Indra Nagar, Sastri Nagar and Besant Nagar. Lands required for developing the above said schemes were procured through the land
acquisition and alienation of Government lands. Layout had undergone several revisions and final layout was approved by the Director of Town
and Country Planning, the competent authority in 1971. In that layout, an extent of 51 grounds and 0290 sq.ft. was earmarked for High School
purpose. Entire extent was encroached by T.D.Parasuraman and 24 others. The encroachers, prevented TNHB from utilising the land through
several protracted litigations before High Court and Supreme Court for about 32 years. After successfully clearing all the hurdles, TNHB evicted
the encroachers and took possession of the disputed property on 08.5.2003. Public purpose site/School site was re-classified as residential and
layout of 20 Plots was formed and approved by CMDA and each of the Writ Petitioners were allotted one Plot [about 2 grounds each].
Allotment of Plots to the Writ Petitioners was challenged by one Poochi S.Murugan in W.P. Nos. 5499 to 5503/2006. In those Writ Petitions,
ground of challenge was that the Plots are likely to be given for lower value than the prevailing market price. Respondents have resisted those Writ
Petitions contending that the price to be fixed for the said Plots would be based on the market price or guideline value whichever is higher.
By the order dated 26.4.2006, all those Writ Petitions were dismissed. Pointing out the averments in the counter-affidavit and observing that
apprehension in the mind of the Writ Petitioner is not well founded, Division Bench of this Court has held as under:
...As rightly contended by the learned Additional Advocate General, under the impugned order, price is not fixed at all. Under these
circumstances, we have no doubt at all that the Petitioner is before this Court very prematurely, even assuming he has a cause of action. To make it
more explicit, it is clear from the records that till date the Housing Board had not fixed the price for the Plots which it has to allot, pursuant to the
Government Order challenged in these Writ Petitions. The Housing Board had also given an undertaking in the counter affidavit that the price to be
fixed for the said Plots would be based on the market price or the guideline value whichever is higher. This undertaking is enough to safeguard the
apprehension in the mind of the Writ Petitioner.
Thereafter in 2006, there was change in the Government. After thorough investigation of earlier allotments, Government took a policy decision
to review the earlier allotments. Besant Nagar/Indra Nagar scheme was reviewed. It was noticed that the earlier allotment made under various
Government Orders, area allotted was 4800 sq.ft. and Government have decided to reduce the area of Plots from 4800 sq.ft. to 2400 sq.ft. Main
reason for cancellation of allotment is that if the size of the Plots are reduced to one ground and sold through public auction, Board will get more
revenue and more number of people will be accommodated.
In the counter affidavit filed in W.P. No. 5499/2006 and batch, Government has taken the stand as follows:
...The cost will be fixed based on the market value or guideline value whichever is higher. The beneficiaries on satisfying the condition stipulated
under Government Discretionary Quota and on payment of the cost fixed by the Board alone will be eligible for allotment.
Much emphasis was laid upon the stand of the Government in the earlier Writ Petitions wherein the Government has averred that value of Plots
would be fixed as per the market value or guideline value whichever is higher.
Laying emphasis upon the stand of Government in the earlier Writ Petitions, onbehalf of the Petitioners it was contended that when cost would
be fixed based on market value or guideline value whichever is higher, there would not be any loss of revenue to TNHB. Mr. K.M.Vijayan,
learned Senior Counsel for the Petitioners has submitted that once allotment was made under Government Discretionary Quota, TNHB has
nothing to offer its further views. It was further argued that there was no Bench mark to decide what was the revenue stipulated and while so, it
would be too premature to decide that there would be loss of revenue. It was further argued that in any event the concept of protecting the revenue
of TNHB is very vague. Learned Senior Counsel would further submit that the very allotment under Government Discretionary Quota would
negate public auction. Learned Senior Counsel mainly contended that the only ground for cancellation of allotment appears to be change of
Government and change of Government cannot be the reason for cancellation of allotments and cancellation of allotments is malafide.
Contention that once an allotment is made, TNHB has nothing further to offer its views does not merit acceptance. Since the land belongs to
TNHB and only process of allotment gets over, TNHB has every right to deal with the land and to offer its remarks. Government have decided to
permit the Board to sell the Plots through public auction to cater more public and also to get more revenue to the Board which in turn would be
reinvested for the purpose of providing housing facility to the needy and homeless people. The Plots are situated at Indra Nagar, Adyar which is a
prime locality in Chennai. It is a matter of common knowledge that value of the property in South Chennai being in close proximity to I.T. Highway
and development of I.T. Companies at OMR has enormously increased. As rightly submitted by the learned Advocate-General, it is difficult to get
even 1200 sq.ft. of plot in Adyar and Besant Nagar area. Therefore, no ulterior motive can be attributed for the proposed reduction of size of Plot
and sell by public auction.
TNHB has to necessarily augment revenue to accomplish its object. Being the owner of the properties, TNHB is the custodian of its
properties. Allotment of Plots/flats/houses to the public is by calling for an application and by conducting lots. TNHB is committed to Social
Housing Scheme thereby catering to the needs of homeless. To accomplish its commitment of Social Housing Scheme, TNHB has to ensure that it
gets maximum revenue so that it could meet its other commitments of providing houses to homeless. Therefore, TNHB was right in offering its
remarks that extent of one plot 4800 sq.ft. be reduced to 2400 sq.ft., so that more persons would be benefited. Very purpose of conversion of the
Plot from School site to residential was to fetch more revenue and that more beneficiaries could be accommodated.
Having regard to the location and price it would fetch, it is for the Government and TNHB to take appropriate decision as to what should be
the extent of Plots. Plots being situated in Indra Nagar/Besant Nagar where space is very scarce, Respondents are right in saying that if extent of
Plot reduced to 2400 sq.ft. more persons would be benefited. As the Plots are located in prime locality close to I.T. Highway, by auctioning of
Plots, it would fetch more revenue. In such view of the matter, the underlying object of cancellation cannot be doubted. The Petitioners are not
right in contending that there was arbitrary exercise of power.
Invoking doctrine of promissory estoppel, reliance was placed upon U.P. Power Corporation Ltd. and Another Vs. Sant Steels and Alloys (P)
Ltd. and Others, . It was contended that when Government offers certain benefits, it cannot withdraw those benefits. Observing that
Government/its instrumentality should abide by their commitments in U.P. Power Corporation Ltd. and Another Vs. Sant Steels and Alloys (P)
Ltd. and Others, , the Supreme Court has held as follows:
In this 21st century, when there is global economy, the question of faith is very important. The Government offers certain benefits to attract the
entrepreneurs and the entrepreneurs act on those beneficial offers. Thereafter, the Government withdraws those benefits. This will seriously affect
the credibility of the Government and would show the short-sightedness of governance. Therefore, in order to keep the faith of the people, the
Government or its instrumentality should abide by their commitments. In this context, the action taken by the appellant Corporation in revoking the
benefits and people will not take the word of the Government. That will shake the faith of the people in the governance. Therefore, in order to
keep the faith and maintain good governance it is necessary that whatever representation is made by the Government or its instrumentality which
induces the other party to act, the Government should not be permitted to withdraw from that. This is a matter of faith.
In the said case, Government allowed hill development rebate to new industrial units for five years from the date of commencement of supply
of electricity. Consequently, Respondent entrepreneurs establishing new industrial units in hill areas after huge investments. However, before the
expiry of the period stipulated in the said notifications, earlier notifications were superseded and the rate of such rebate was reduced. Based on the
notification since entrepreneurs established new industrial units in hill areas pointing huge investments of entrepreneurs, Supreme Court has held that
Government and U.P. Power Supply Corporation cannot revoke the benefits and that it would shake faith of the people in the governance.
Facts of the above case cannot be compared to the instant case. In the present case, there is no vested right on the Petitioners so as to invoke
principle of promissory estoppel. Allottees/beneficiaries have not questioned any legal right in the allotted Plots. When the Writ Petitioners have no
accrued legal right, they cannot compel the Government/TNHB to allot the Plots. Petitioners have not got any vested right and as such no right
accrued to them. In the absence of any accrued/vested right, Petitioners cannot seek Writ of Certiorari.
Writ Petitioners have sought for Writ of Certiorari quashing order of cancellation and to direct the Respondents to restore the order of
allotment. Having prayed for Writ of Certiorari, in my considered view, it is incumbent on the Petitioners to show that they have vested right in the
subject matter i.e Plots. Grant of Certiorari/Writ of Mandamus, it presupposes a legal right in favour of the Petitioners. There must be a
corresponding duty to apply that duty cast upon Government to sustain the allotments. When there is no right accrued to Petitioners, the Petitioners
cannot successfully challenge the cancellation.
Observing that promissory estoppel is based on equity or obligations and that it is not based on vested right, in M.P. Mathur and Others Vs.
D.T.C and Others, , the Supreme Court held as follows:
As regards the first contention, we may observe that promissory estoppel is based on equity or obligations. It is not based on vested right. In
equity the court has to strike a balance between individual rights on one hand and the larger public interest on the other hand. Freedom to contract
is a common law civil liberty enjoyed by all persons. But when the Government is contracting with private parties this common law freedom is
circumscribed by the principles of administrative law which requires larger public interest to be taken into account. We must remember that larger
public interest is not only for accommodating retiree workmen but also to accommodate in-service workmen. Even applying the principles
enshrined in Article 39 (b) and (c) of the Constitution, egalitarian equality requires the Government to strike a balance between competing claims.
Even in the realm of social justice, on which our Constitution is founded, the administration has to strike a balance between the competing claims....
Similarly, in the case of Bannari Amman Sugars Ltd. Vs. Commercial Tax Officer and Others, , the Division Bench of this Court speaking
through one of us, Pasayat, J., vide paras 19 and 20 observed as follows:
In order to invoke the doctrine of promissory estoppel clear, sound and positive foundation must be laid in the petition itself by the party
invoking the doctrine and bald expressions without any supporting material to the effect that the doctrine is attracted because the party invoking the
doctrine has altered its position relying on the assurance of the Government would not be sufficient to press into aid the doctrine. The Courts are
bound to consider all aspects including the results sought to be achieved and the public good at large, because while considering the applicability of
the doctrine, the Courts have to do equity and the fundamental principles of equity must for ever be present in the mind of the Court.
In Shrijee Sales Corporation and Another Vs. Union of India (UOI), it was observed that once public interest is accepted as the superior
equity which can override individual equity the principle would be applicable even in cases where a period has been indicated for operation of the
promise. If there is a supervening public equity, the Government would be allowed to change its stand and has the power to withdraw from
representation made by it which induced persons to take certain steps which may have gone adverse to the interest of such persons on account of
such withdrawal. Moreover, the Government is competent to rescind from the promise even if there is no manifest public interest involved,
provided no one is put in any adverse situation which cannot be rectified. Similar view was expressed in M/s. Pawan Alloys and Casting Pvt. Ltd.,
Meerut etc, etc. Vs. U.P. State Electricity Board and others, and in Sales Tax Officer and Another Vs. Shree Durga Oil Mills and Another, and its
was further held that the Government could change its industrial policy if the situation so warranted and merely because Resolution was announced
for a particular period, it did not mean that the government could not amend and change the policy under any circumstances. If the party claiming
application of the doctrine acted on the basis of a notification it should have known that such notification it should have known that such notification
was liable to be amended or rescinded at any point of time, if the Government felt that it was necessary to do so in public interest.
The order of allotment was only in the stage of proposal. Nothing more was done in furtherance of the order of allotment. Unless anything
further has been done in the process of allotment, TNHB has every right to seek revision of approved plan. Until process of allotment is over,
TNHB has every right to deal with the land in accordance with law, in furtherance of its commitment to Social Housing Scheme and to augment its
income.
Drawing Court''s attention to various allotments made during 2001-2006, learned Senior Counsels for Petitioners submitted that during 2001-
2006, number of allotments were made. It was further submitted that Respondents have not reviewed various other allotments made during such
period [2001-2006] and there is an element of ""pick and choose"" in reviewing Besant Nagar scheme and cancelling the allotments of Writ
Petitioners which amounts to selective discrimination.
Ofcourse, during 2001-2006 various allotment of Plots were made under Government Discretionary Quota. Government Discretionary Quota
is reserved for allotment to the persons coming under different categories such as Eminent Sportsman, Journalist, Social Worker, Widow etc.,.
Such allotments are made based on the request of the concerned persons or by the Government itself subject to the availability of Plots under
different housing scheme. It is for the Government to decide to whom the largesse to be given and how to allot it. With the development of I.T.
Companies and other industrialisation in and around Chennai, in Chennai space has become a valuable asset. TNHB being committed to Social
Housing Scheme, it has to augment its revenue so that it could provide accommodation to the needy and homeless in achieving its commitment of
Social Housing Scheme.
As pointed out earlier, it is a matter of common knowledge that the value of the property in Adyar, Besant Nagar and Indra Nagar has
increased enormously. When the Plots are situated in such prime locality, it is for the Housing Board and Government to take appropriate decision
by changing its policy decision so that it might fetch more revenue.
Contending that by allotment of Plots, Respondents committed themselves and when the Respondents acted unlawfully in relation to its
commitments, invoking doctrine of legitimate expectation, Court is to interfere with cancellation of allotment, on behalf of the Petitioners reliance
was placed upon Southern Petrochemical Industries Co. Ltd. Vs. Electricity Inspector and E.T.I.O. and Others, . In the case of Petitioners, there
is no question of application of doctrine of legitimate expectation As pointed out earlier, Government Orders were passed making allotment of
Plots to the Petitioners. Absolutely, there is no averment in the affidavits that based on the Government Orders, Petitioners have changed their
position and cancellation would prejudicially affect their interest. As rightly submitted by the learned Advocate-General, there was no pleadings or
averments to the effect that Petitioners have acted changing their position nor any averments that Petitioners have suffered any loss and that
cancellation would affect their interest. Absolutely, there is nothing to show that the order of cancellation will divest the Petitioners with civil
consequences and there is no question of invoking promissory estoppel or legitimate expectation.
In Jitendra Kumar and Others Vs. State of Haryana and Another, , it has been reiterated that a legitimate expectation is not the same thing as
an anticipation. It is distinct and different from a desire and hope. It is based on right.
But a claim based on mere legitimate expectation without anything more cannot ipso facto give a right to invoke these principles. It is well
settled that the concept of legitimate expectation has no role to play where the State action is as a public policy or in the public interest unless the
action taken amounts to an abuse of power. The court must not usurp the discretion of the public authority which is empowered to take the
decisions under law and the court is expected to apply an objective standard which leaves to the deciding authority the full range of choice which
the legislature is presumed to have intended. Even in a case where the decision is left entirely to the discretion of the deciding authority without any
such legal bounds and if the decision is taken fairly and objectively, the court will not interfere on the ground of procedural fairness to a person
whose interest based on legitimate expectation might be affected. Therefore, a legitimate expectation can at the most be one of the grounds which
may give rise to judicial review but the granting of relief is very much limited. [Vide Hindustan Development Corporation (1994 AIR SCW 643)].
A person who basis his claim on the doctrine of legitimate expectation, in the first instance has to satisfy that he has relied on the said
representation and denial of that expectation has worked to his detriment. Court could interfere only if the decision taken by the authority was
found to be arbitrary, unreasonable or in gross abuse of power and not taken in public interest.
In M.P. Mathur''s case cited supra, Supreme Court has held that Government is competent to rescind from the promise even if there is no
manifest public interest involved provided no one is put in any adverse situation which cannot be rectified. As pointed out earlier, absolutely there is
nothing to show that Petitioners have changed their position and that cancellation of allotment had prejudicially affected them.
As the order of allotment was only a proposal and nothing further has been done in the process of allotment, TNHB has every right to seek for
revision of approved plan and reduction in the size of the Plots. No ulterior motive could be attributed for the proposed reduction in size of Plots
and the proposed revision of approved layout and cancellation of allotments to Petitioners cannot be said to be arbitrary or unreasonable or against
the public interest warranting interference exercising judicial review.
It was nextly contended that by cancellation of allotment of Plots to the Petitioners alone there was selection discrimination, it is for the Housing
Board to decide what to do with each of the property and the discretion solely vested with the Government. That apart this is not a public interest
litigation to go into rationale of allotment of other Plots. As rightly submitted by the learned Advocate-General resources of the Government are
very limited to fetch to higher price would be the ultimate object of TNHB and the Government. There is no substance in the contention that by
cancellation of allotment of Plots, there was selective discrimination.
The impugned orders are challenged on the ground of violation of principles of natural justice. Learned Senior Counsels for the Petitioners
submitted that once there was an allotment, by cancellation, interest was taken away from the Petitioners which is in violation of principles of
natural justice. It was further argued that once the allotment was made to the Petitioners, cancellation involves civil consequences and therefore,
opportunity ought to have been afforded to the Writ Petitioners.
Giving opportunity of hearing stems from a right. Since there was no vested right in the Petitioners, no civil consequences are involved and
therefore, there was no necessity for issuance of show cause notice.
Placing reliance upon Dr. J. Shashidhara Prasad Vs. Governor of Karnataka and Another, and Ravi S. Naik and Sanjay Bandekar Vs. Union
of India and others, , learned Advocate-General submitted that while applying the principles of natural justice, it must be borne in mind that they
are not immutable but flexible and they are not case in a rigid mould and they cannot be put in a legal strait-jacket. Whether the requirements of
natural justice are to be complied with or not has to be considered in the context of the facts and circumstances of a particular case.
Observing that whether rule of natural justice should apply to a given case must depend upon a great extent to the facts and circumstances of
that case, in A.K. Kraipak and Others Vs. Union of India (UOI) and Others, , the Supreme Court held as follows:
What particular rule of natural justice should apply to a given case must depend to a great extent on the facts and circumstances of that case, the
frame-work of the law under which the enquiry is held and the constitution of the Tribunal or body of persons appointed for that purpose.
Whenever a complaint is made before a court that some principle of natural justice had been contravened the court has to decide whether the
observance of that rule was necessary for a just decision on the facts of that case.
Similarly, in R.S. Dass Ors. Vs. Union of India (UOI) and Others, , the Supreme Court has held as under:
It is well established that rules of natural justice are not rigid rules; they are flexible and their application depends upon the setting and the
background of statutory provision, nature of the right which may be affected and the consequences which may entail, its application depends upon
the facts and circumstances of each case.
Principles of natural justice are not rigid or immutable and they cannot be imprisoned in a strait-jacket formula. They must yield to and change
with exigencies of situation. Order of allotment was just an allotment order. No right was vested with the Petitioners nor have they altered their
position. When that being so, non-observance of natural justice cannot be said to have prejudicially affected the interest of Petitioners. In my
considered view, even if hearing was afforded to the Petitioners, notice would have served no purpose or Petitioners could not have offered any
defence. After all, in the cancellation order it was specifically observed that all the Petitioners are to be permitted to participate in the open auction.
Grievance of the Petitioners regarding violation of principles of natural justice has no force.
Since no right accrued to the Petitioners, cancellation of allotment no way prejudicially affected the Petitioners. In such view of the matter,
Petitioners cannot challenge the action of Government in cancellation of allotments. While exercising jurisdiction under Article226 of Constitution of
India, High Court would not issue Writs if it was satisfied that there has been no violation of statutory provisions or arbitrary exercise of powers.
The impugned order of cancellation of allotments cannot be said to be arbitrary exercise of power warranting interference.
In the result, all the Writ Petitions are dismissed. No costs. Interim stay already granted is vacated and all the M.Ps. are closed.