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Judgment
Anjani Kumar and Dilip Gupta, JJ.—The petitioner who had been allotted a constructed built up area measuring 250 sq. meter by Greater Noida Development Authority (hereinafter referred to as the ''Authority''), has tiled this petition for a the respondent-bank for mortgaging the said property and for a further direction upon the Authority to enter into a tripartite agreement with the Bank for raising loan to facilitate the petitioner to deposit the amount of Rs. 34,60,400/- demanded by the Authority by the letter dated 18th December, 2006. An alternative prayer for a direction upon the Authority to Convert the cash down payment as demanded by the letter dated 18th December, 2006, into hire- purchase for three years has also been sought.
The Authority issued an advertisement in the year 2006 inviting application for built up houses for various plot sizes. In the terms and conditions, it was provided that the mode of allotment was to be done by draw of lots which was to be done first for allottees opting cash down scheme (A-5.1) and then for the remaining houses if any, for installment plan (A-5.2). A-5.1 plan required cash down payment after adjusting the registration amount within ninety days from the date of allotment while A-5.2 plan required allotment money equal to 20% of the total premium to be paid within 45 days from the date of allotment and the balance in eight equal interest free quarterly installment. It was specifically provided that the allottee could change the payment plan from installment mode of payment to cash down mode of payment but permission to change the payment plan from cash down of payment to installment mode of payment would not be granted under any circumstances. The registration amount for a constructed built up area measuring 250 sq. meters was Rs. 3.70 lacs whereas the tentative cost of the house was mentioned as Rs. 36.48 lacs.
Clause-K of the scheme provided for mortgage of the house after execution of the lease deed and the same is as follows:
K. MORTGAGE
The allottee/lesee may, with the previous consent of the lessor, mortgage the house, after execution of lease deed, to any recognized financial institution for raising loan for the purpose of funding the installments etc. and subject to such terms and conditions as may be decided by the lessor at the time of granting the permission.
Provided that in the event of sale or fore closure of the mortgage on charged property the lessor shall be entitled to claim and recover such percentage, as decided by the lessor, Of the unearned increase in the value of said house as first charge. The decision of the lessor in respect o f the market value of the said land/house shall be final and binding on all the parties concerned.
Provided further that lessor shall have pre-emptive right to purchase the mortage or charged property after deducting such percentage as decided by the lessor on the unearned increase as aforesaid. The lessor''s right to the recovery of the unearned increase and the pre-emptive right to purchase the property as mentioned herein before shall apply equally in voluntary sale or transfer, be it by or through execution of decree of insolvency/court.
The petitioner had Submitted an application for allotment of a built up house in a plot measuring 250 sq. meters in the aforesaid scheme under the cash down plan (A-5.1) A communication dated 18th December, 2006 was sent by the Authority mentioning therein that the petitioner had been allotted plot No. 87 in Block ''B'' of Sector OMICRON-02 and the petitioner was required to deposit the allotment amount of Rs. 34.60.400.00 on or before 18th March,2007.It was also specifically mentioned that in case she fails to deposit the allotment money, the allotment could be cancelled and the money deposited (sic) the date of cancellation would be forfeited. It was also mentioned that the terms and conditions mentioned in the brochure for the scheme Shall from part of the allotment and shall be binding on the allottees Upon receipt of the aforesaid allotment letter, the petitioner approach the Bank Maharashtra for availing loan facility for making the payment but the Manger of the flank by his letter dated 11th March, 2007 informed the petitioner that they shall consider the application for housing loan provided the petitioner obtains a ''no objection certificate'' from the Authority for mortgage of the property and a tripartite agreement is executed between the Authority, Bank and the borrower. The petitioner, therefore, by this letter dated 12th March, 2007 requested the Authority to issue mortgage permission but the Authority did not issue the ''no objection certificate'' nor did it express any desire to to execute the tripartite agreement. This petition has, accordingly been filed for the aforesaid reliefs.
We have heard learned Counsel for the petitioner and Sri Pradeep Kumar, learned Counsel appearing for the Authority.
Learned Counsel for the petitioner submitted that though the mortgage clause contained in Clause-K of the terms and conditions provides that the allottee may, with the previous consent of the lessor, mortgage the house after execution of the lease deed to any financial institution for raising loan for the purpose of funding the installments etc. but in a case where cash down payment is to be made, the said clause is imaginary and, therefore, liable to be modified so to make it effective. He further submitted that the petitioner believed that she would be able to raise loan from the Bank, as in the past the Authority had been issuing the ''no objection certificate'' and had also entered into various tripartite agreements with the Bank and it is on the basis of the aforesaid legitimate expectation that the petitioner had submitted the application. He therefore, submitted that the Authority is under an obligation to issue the ''no objection certificate'' and enter into a tripartite agreement with the Bank so that the Bank may give the loan to the petitioner for making the payment, particularly when in some earlier cases the Authority had done so.
Sri Pradeep Kumar, learned Counsel appearing for the Authority, however, submitted that the house can be mortgaged in favour of any recognised financial institution for raising the loan only after the execution of the lease deed as is absolutely clear from Clause-K of the terms and condition and the petitioner having accepted the same cannot now turn around and insist that the Authority should permit the mortgage of the house even though the lease deed has not been executed. He further submitted that in view of this specific clause contained in terms and conditions, there was no occasion for the petitioner to believe that the Authority would give its consent for mortgage of the house in favour of the Bank even prior to the execution of the lease deed and that no discrimination whatsoever has been practiced by the Authority in such matters.
We have carefully considered the submissions advanced by the learned Counsel for the parties.
The petitioner responded to the advertisement issued by the Authority by submitting an application for allotment of a built up house in a plot measuring 250 sq. meters on the basis of cash down payment. It needs to be pointed out that under the scheme, there were two modes provided for payment. The petitioner could have opted either for cash down payment (A-501) or two year interest free installment plan (A-5.2) but the petitioner opted for the cash down payment presumably for the reason that he would have a better chance of allotment as the allotment was to be made by the draw of lots first for the allottees opting cash down plan and the draw of lots for the installment plan was to be held only for the remaining houses, if any. The cash down payment plan provides that the amount has to be paid within ninety days from the date of allotment. Clause-K relating to the mortgage deed clearly stipulates that it is only after the execution of the lease deed and with the previous consent of the Authority that the house can be mortgaged in favour of any recognised financial institution for raising the loan for the purposes of payment of installment and, therefore, in a case where cash down payment is to be made, the allotee cannot insist as a matter of right that the Authority should give its previous consent for mortgage of the house in favour of the financial institution. We are, therefore, of the considered opinion that in view of specific clause contained in the terms and conditions, there was no occasion for the petitioner to believe that if the petitioner opted for the cash down payment plan then too the Authority would give its previous consent for mortgaging the house in favour of the financial institution.
Learned Counsel for the petitioner, however, submitted that the condition providing for mortgage of the house for payment to the Authority with the prior consent of the Authority only for installment plan and that too after execution of the leasee deed is arbitrary and unreasonable and that the Authority was obliged to enter into a tripartite agreement as requested by the Bank. In support of his contention, he placed reliance upon the decisions of the Supreme Court in Delhi Science Forum and others Vs. Union of India and another, M.P. Oil Extraction and Another Vs. State of M.P. and Others, and LIC of India and Another Vs. Consumer Education and Research center and Others,
The petitioner has challenged the policy decision contained in the terms and conditions as being arbitrary and unreasonable. It would therefore, be appropriate to refer to certain decisions of the Supreme Court wherein the scope of interference in policy decision has been dealt with.
In Ekta Shaki Foundation v. Govt. of NCI of Delhi AIR 2006 SCW 3601 the Supreme Court observed as follows:
While exercising the power of judicial review of administrative action, the Court is not the appellate authority and the Constitution does not permit the Court to direct or advise the executive in matter of policy or to sermonize any matter which under the Constitution lies within the sphere of the Legislature or the executive, provided these authorities do not transgress their constitutional limits or statutory power. See Asif Hameed and others Vs. State of Jammu and Kashmir and Others, M/s. Shri Sitaram Sugar Co. Ltd. and another Vs. Union of India and others, The Scope of judicial enquiry is confined to the question whether the decision taken by the Government is against any statutory provisions or is violative of the fundamental rights Of the citizens or is opposed to the provisions of the Constitution. Thus, the position is that even if the decision taken by the Government does not appear to be agreeable to Court it cannot interfere.
The correctness of the reasons which prompted the Government in decision making, taking one course of action instead of another is not a matter of concern in judicial review and the Court is not the appropriate forum for such investigation.
The policy decision must be left to the Government as it alone can adopt which policy should be adopted after considering all the points from different angles. In matte of policy decisions or exercise of discretion by the Government so long as the infringement of fundamental right is not shown Courts will have no occasion to interfere and the Court will not and should not substitute its own judgment for the judgment of the executive in such matters. In assessing the propriety of a decision of the Government the Court cannot interfere even if a second view is possible from that of the Government.
The Court should constantly remind itself of what the Supreme Court of the United States said in Metropolis Theatre Co. v. City of Chicago (1912) 57 LEd 730 . The problems of Government are practical ones and may justify if they do not require, rough accommodations, illogical it may be, and unscientific. But even such criticism should not be hastily expressed. What is the best is not always discernible, the wisdom of any choice may be disputed or condemned. Mere errors of government are not subject to our judicial review. See: State of Orissa and Others Vs. Gopinath Dash and Others,
(emphasis supplied)
In Akhil Bharat Gosewa Sangh Vs. State of A.P. and Others, the Supreme Court observed:
...We are of the view that the policy of the Central Government cannot be easily struck down only because there was slight decline of cattle growth nor can it be struck down before looking into the entire aspect of the matter. It is also well settled that policy decision of the Government cannot be interfered with or struck down merely on certain factual disputes in the matter. It is not open to the Court to strike down such decision until and unless a serious and grave error is found on the part of the Central Government or the State Government.
In Karnataka State Industrial Investment and Development Corporation Ltd. Vs. Cavalet India Ltd. and Others, the Supreme Court observed that in commercial matters, the courts should not risk their judgments for that of the bodies to which that task is assigned and that unless the action of the Financial Corporation is mala fide, even a wrong decision taken by it is not open to challenge. It was further observed that it is not for the Courts or third party to substitute its decision, howsoever, more prudent, commercial or businesslike it may be, for the decision of the Financial Corporation.
In Union of India and Others Vs. Dinesh Engineering Corporation and Another etc., the Supreme Court observed:
There is no doubt that this Court has field in more than one case that where the decision of the authority is in regard to a policy matter, this Court will not ordinarily interfere since these policy matters are taken based on expert knowledge of the persons concerned and courts are normally not equipped to question the correctness of a policy decision. But then this does not mean that the courts have to abdicate their right to scrutinise whether the policy in question is formulated keeping in mind all the relevant facts and the said policy can be held to be beyond the pale of discrimination or unreasonableness, bearing in mind the material on record....Any decision, be it a simple administrative decision or a Policy decision, if taken without considering the relevant fact, can only be termed as an arbitrary decision. If it is so then be it a policy decision or otherwise, it will be violative of the mandate of Article 14 of the Constitution.
It is, therefore clear from the aforesaid decisions that in matter of policy decisions or exercise of discretion, so long as infringement of fundamental lights. is not shown, Courts should not interfere and should not substitute its own judgment for the judgment of the executive in such matters. In fact in assessing the propriety of a decision of the Government the Court cannot interfere even if a second view is possible.
In the present case, the petitioner specifically opted for the cash down payment scheme, It is only when installments have to be paid that the house could be mortagaged in favour of the financial institution with the previous consent of the lessor after execution of the lease deed. The contention of the petitioner is that the said policy of the Authority is arbitrary and unreasonable. In our opinion it is for the Authority to prescribe the terms under which the. mortgage can be executed in favour of any financial [Institution proposing to give loan to the allotee and the allotee does not have an absolute right to get the loan. In the case of installment plan, 20% of the total premium has to be paid within 45 days of the allotment and the balance amount is paid in eight equal interest free quarterly installments. The Authority has also brought on record the Government Order dated 24.1.2000 which clearly provides that t Development Authorities should give permission for mortgage, of houses/plots only after execution of the deed and not on the basis of allotment order as rights upon the land/house accrue to the allotee only after the deed in executed. We have not been able to persuade ourselves to hold that such a restriction is unreasonable or arbitrary. It cannot also be paid that the Authority was under a legal obligation to execute the tripartite agreement as again it has to determine the terms. The decisions on which reliance has been placed by the learned Counsel for the petitioner do not run Contrary to the provision of law enunciated by the Courts in the aforesaid decisions of the Supreme Court. Such being the position. we do not find any merit in the contention Advanced by the learned Counsel for the petitioner.
Learned Counsel for the petitioner then contended that the Authority has practiced discrimination as certain mortgage deeds had been executed by the Authority in favour of financial institution even before the execution of the lease deed. In the counter affidavit, it has been specifically stated that in the present scheme the Authority has not executed any mortgage deed in favour of any financial institution where the lease deed has not been executed. Learned Counsel for the petitioner, however, urged that in the past in some other scheme the Authority had executed the mortgage deeds but the petitioner has not brought on record the terms and conditions set out by the Authority where such mortgage deeds had been executed and. therefore, it is not possible to examine this Contention. However, in any view of the matter, even if be assumed that mortgage deeds had been executed in spite of such a condition then too we are of the opinion that a wrong committed in the past will not confer a right oh the petitioner to insist that the authority should commit the same mistake again. This is what has been repeatedly observed by the Supreme Court.
In Gursharan Singh and others etc. Vs. New Delhi Municipal Committee and others, the Supreme Court observed:
Neither Article 14 of the Constitution conceives within the equality clause this concept nor Article 226 empowers the High Court to enforce such claim of equality before law. If such claims are enforced, it shall amount to directing to continue and perpetuate an illegal procedure or an illegal order for extending similar benefits to others. Before a claim based on equality clause is upheld, it must be established by the petitioner that his claim being just and legal, has been denied to him, while it has been extended to others and in this process there has been a discrimination.
In Union of India (UOI) and Another Vs. International Trading Co. and Another, the Supreme Court observed:
...A party cannot claim that since something wrong has been done in another case direction should be given for doing another wrong. It would not be setting a wrong right, but would be perpetuating another wrong. In such matters there is no discrimination involved. The concept of equal treatment on the logic of Article 14 of the Constitution of India (in short "the Constitution") cannot be pressed into service in such cases. What the concept of equal treatment presupposes is existence of similar legal foothold. It does not countenance repetition of a wrong action to bring both wrongs on a par. Even if hypothetically it is accepted that a wrong has been committed in some other cases by introducing a concept of negative equality the respondents cannot strengthen their case....
In U.P. State Sugar Corporation Ltd. and Anr. v. Sant Raj Singh and Ors. AIR 2006 SCW 3013 the Supreme Court observed:
Moreover, Article 14 has a positive concept. Nobody can claim equality in illegality.
In Ekta Shakti foundation v. Govt. of NCT of Delhi AIR 2006 SCW 3601 the Supreme Court observed:
In a converse case, in the first instance, one may be wrong but the wrong order cannot be foundation for claiming equality for enforcement of the same order. As state earlier, his right must be founded upon enforceable right to entitle him to the equality treatment for enforcement thereof. A wrong decision by the Government does not give a right to enforce the wrong order and claim parity or equality. Two wrongs can never make a right.
Learned Counsel for the petitioner also submitted that as in the past the Authority had been issuing the ''no objection certificate'' and had also entered into various tripartite agreements with the Bank, the petitioner had a legitimate expectation that she would also be able to raise loan from the Bank and it is on the basis of this expectation that the petitioner had tiled the application from before the Authority.
The Supreme Court in the case of Ram Pravesh Singh and Others Vs. State of Bihar and Others, has elaborately dealt with this issue and has observed:
What is legitimate expectation? Obviously, it is not a legal right. It is an expectation of a benefit, relief or remedy, that may ordinarily flow from a promise or established practice. The term "established practice" refers to a regular, consistent, predictable and certain conduct, process or activity of the decision-making authority, The expectation should be legitimate, that is, reasonable, logical and valid. Any expectation which is based on sporadic or casual or random acts, or which is unreasonable, illogical or invalid cannot be a legitimate expectation. Not being a right, it is not enforceable as such. It is a concept fashioned by the courts, for judicial review of administrative action. It is procedural in character based on the requirement of a higher degree of fairness in administrative action, as a consequence of the promise made, or practice established. In short, a person can be said to have a "legitimate expectation" of a particular treatment, if any representation or promise is made by an authority, either expressly or impliedly, or if the regular and consistent past practice of the authority gives room for such expectation in the normal course. As a ground for relief, the efficacy, of the doctrine is rather weak as its slot is just above "fairness in action" but far below "promissory estoppel". It may only entitle an expectant: (a) to an opportunity to show cause before the expectation is dashed; or (b) to an explanation as to the case for denial In appropriate cases, the courts may grant a direction requiring the authority to follow the promised procedure or established practice. A legitimate expectation, even when made out, does not always entitle the expectant to a relief Public interest, change in policy, conduct of the expectant or any other valid or bona fide reason given by the decision-maker, may be sufficient to negative the "legitimate expectation". The doctrine of legitimate expectation based on established practice (as contrasted from legitimate expectation based on a promise), can be invoked only by someone who has dealing or transactions or negotiations with an authority, on which such established practice has a bearing, or by someone who has a recognised legal relationship with the authority. A total stranger unconnected with the authority or a person who had no previous dealings with the authority and who has not entered into any transaction or negotiations with the authority, cannot invoke the doctrine of legitimate expectation, merely on the ground that the authority has a general obligation to act fairly.
In Union of India and others Vs. Hindustan Development Corpn. and others, the Supreme Court Observed:
For legal purposes, the expectation cannot be the same as anticipation. It is different from a wish, a desire or a hope nor can it amount to a claim or demand on the ground of a right. However, earnest and sincere a wish, a desire or a hope may be and however confidently one may look to them be fulfilled, they may themselves cannot amount to an assert able expectation and a mere disappointment does not attract legal consequences. A pious hope even leading to a moral obligation cannot amount to a legitimate expectation. The legitimacy of an expectation can be inferred only if it is founded on the sanction of law or custom or an established procedure followed in regular and natural sequence. Again it is distinguishable from a genuine expectation. Such expectation should be justifiably legitimate and protectable. Every such legitimate expectation does not by itself fructify into a right and therefore it does not amount to a right in the Conventional sense.
The petitioner has failed to establish that the past practice referred to was a regular, consistent predictable and certain conduct as any sporadic or casual or random act which is invalid cannot give rise to a legitimate expectation. The legitimacy of an expectation can be inferred only if it is founded on sanction of law or custom or any established procedure. In the absence of these factors, the petitioner cannot be permitted to raise the plea of legitimate expectation.
In the end learned Counsel for the petitioner contended that he may be permitted to opt for the installment plan (A-5.2) instead of the cash down scheme (A-5.1). This prayer cannot be accepted as the terms and conditions contained in the brochure specifically provide that the payment plan from cash down payment cannot be changed under any circumstances to installment mode of payment. The plausible reason for not permitting such a change appears to be on account of the fact that the draw of lots is first done for cash down payment plan and it is only when certain houses still remain that the draw is made for those applicants opting for the installment plan.
In view of the above, as none of the contentions raised by the petitioner have any substance the writ petition is liable to be dismissed and is, according dismissed.