PUNE HOUSING AND AREA DEVELOPMENT BOARDversusVITHAL SHRIPATI LADKAT

                                                                   WP-798-2007 C3.doc



                                  IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                          CIVIL APPELLATE JURISDICTION

                                         WRIT PETITION NO. 798 OF 2007

                   Pune Housing And Area Development Board
                   Through its Estate Manager,
                   Having office at Grihanirman Bhavan,
                   Agarkar Nagar, Pune – 411 001                        ...Petitioner
                               Versus
                   Vithal Shripati Ladkat
                   Age: Adult, Occup. Business,
SNEHA
NITIN
                   Residing at B-2, Mudhukunj Co-op. Hsg.
CHAVAN             Society Ltd., Paud Road, Pune-38
Digitally signed
by SNEHA
NITIN CHAVAN
                   (through legal Guardian)                             ...Respondent
Date: 2026.06.19
14:15:40 +0530
                   Shri. Jaideep Vithal Ladkat,
                   R/at – 903, A/1 Kumar Prashana Society, Fatima
                   Nagar Road, Near Wanewadi Smashan Bhumi,
                   Jambakar Chaowk, Wanewadi, Pune - 411040

                                                     ****
                   Mr. Uday Warunjikar for the Petitioner.
                   Mr. Nitin Mulye for Respondent.
                                                     ****
                                            CORAM : M.M. SATHAYE, J.
                                              DATE : 17th JUNE, 2026

                   JUDGMENT:


                   1.              The Petitioner is a Housing and Area Development Board,
                   Pune (‘the Board’ for short). It has filed the present petition under
                   Article 226 and 227 of the Constitution of India, challenging the order
                   dated 06.10.2006 passed in Appeal No. 1 of 1996 and 44 of 1996 by the
                   In-Charge Appellate Officer-II (President, Maharashtra Slum Area I.C. &
                   R Tribunal, Mumbai). By the said order, appeal filed by the Petitioner
                   was dismissed and appeal filed by Respondent was allowed so far as
                   order of eviction (as directed by Competent Authority) is concerned. By
                   the impugned order, the appeal of the Respondent, so far as it relates to


                   Sneha Chavan                                                         1
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price fixation, was disposed of as infructuous.
2.             A tenement bearing No. B-2 Madhukunj Housing Society
situated at L.I.C Colony, Kothrud- Pune is the subject matter of dispute
and it is hereinafter referred to as suit flat for short.


3.             Short background of the dispute is as under.
3.1.           The suit flat was allotted to Respondent by order of State
Government as a special case under Maharashtra Housing and Area
Development Act, 1976 (‘the said Act’ for short). A letter dated
26.07.1993 to that effect was issued by the Desk Officer of the State to
Chief Executive Officer of Maharashtra Housing Board. Its copy is
tendered in Court it is taken on record as page No. 11A in the petition,
by consent of parties.
3.2.           The allotment was from 2% quota of the government. The
order of allotment was issued with a direction that price of the suit flat
should be recovered. However, it was directed that possession should be
given to the Respondent immediately after satisfying necessary
formality and on securing deposit amount. The price of the suit flat was
not fixed at the time of allotment.
3.3.           By a letter dated 24.05.1995, the Respondent was
communicated the price fixed i.e. Rs.5,51,000/- and the Respondent
was asked to pay this amount. By letter dated 14.07.1995, the
Respondent was informed that if he does not pay the amount, then
action of dispossession will be initiated. The Respondent did not pay the
amount. Therefore, the Estate Manager moved Competent Authority,
who issued Notice under Section 66(2) of the said Act.
3.4.           The   Respondent     filed   his   reply     dated         27.11.1995
contending inter alia as under. That since the allotment is by the order
of the Government, consent of Chief Minister is necessary before issuing


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notice. That no price of suit flat was fixed, much less intimated to the
Respondent prior to delivery. That the rate at which price is fixed is not
known. That for the reserved quota of 2% the rate at relevant time was
between Rs.180 to Rs. 225 per sq. ft. That the amount charged from
1987 till allotment was disputed. That the Respondent has paid
Rs.50,000/- to the Board and the price of the suit flat would not exceed
Rs.1,41,130/- which is proper price. That Respondent is ready to pay
the remaining amount.
3.5.           The Competent Authority Pune Division, Pune who heard
and tried Case No. 28 of 1995 passed order dated 07.02.1996. The
Competent Authority was pleased to hold that Respondent has not paid
the amount lawfully due from him for a period more than 2 months. It
is further held that Respondent acted in contravention of terms under
which he was authorized to occupy the suit flat. It was also held that
consent of the Government or Chief Minister is not required. The
Competent Authority considered what is the amount lawfully due and
arrived at a figure of Rs.2,56,405.57 as amount lawfully due and held
that since this full amount is not paid, notice to vacate is necessary.
Ultimately notice was issued to the Respondent to vacate the suit flat.
3.6.           Admittedly, the Respondent paid the balance amount as per
calculation of the Competent Authority.
3.7.           The Respondent however filed Appeal No. 1 of 1996 under
Section 70 of the said Act, challenging the said order. The Petitioner-
Board also filed Appeal No. 44 of 1996 challenging the above order for
non consideration of its claim for remaining amount.
3.8.           The Appellate Officer who heard and tried both the appeals
together passed the impugned order dated 06.10.2006 thereby
dismissing Petitioner's appeal and allowing Respondent's appeal
partially, setting aside the eviction.


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3.9.            In these circumstances, the Petitioner filed the present
petition, which was admitted on 05.12.2007.


                                     SUBMISSIONS
4.             Learned counsel Mr. Warunjikar, appearing for the Petitioner,
submitted as as under.
4.1.            He submitted that Regulation No. 22 of the Maharashtra
Housing and Area Development (Estate Managements, Sale, Transfer
and Exchange of Tenements) Regulations 1981 (‘the said Regulations’
for short) , provides for power of the Board to increase the price of
tenement. That it starts with a non-obstante clause giving overriding
effect over other document, instrument or agreement. That the power
to revise price applies to price of tenement already specified in the
notice or agreement. That Regulation No. 15 of the said Regulations
also provides for variations of the price of tenements. That the facts of
the present case squarely fall under Regulation Nos. 15 and 22 read
together and since the tenement was constructed in 1987 and allotted
in 1993 with a gap of about 6 years, the Authority was well within its
power to increase the amount, including expenditure in the form of
supervision charges and construction escalation cost. That the revised
price demanded in eviction notice represents amount lawfully due and
therefore, ought to have been paid by the Respondent.
4.2.            He submitted that the Competent Authority under Section
66 of the said Act does not have jurisdiction to revise the amount from
Rs.5,51,000 to Rs. 2,56,405/- and the power is limited to inquire into
and adjudicate upon whether the occupant is liable to be evicted. It
does not include power of revision of price. That power to revise
exclusively vests in the Board as provided in Regulation No. 22. That
therefore, the reduction in the amount by the Competent Authority is


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without jurisdiction and is liable to be set aside. He relied upon
Raghunath Gopal Manjire & Anr. v/s. The Competent Authority and
others. [1977 (4) SCC, 578], in support of his submission that the
Board's power to revise financial obligation of allottees is judicially
recognized principle. He submitted that this principle is now elevated
to statutory provision under Regulation No. 22 of the said Regulations.
He further submitted that the Competent Authority derives its
jurisdiction and powers from Section 65 of the said Act, while the
manner and scope of exercise is provided under Section 66 thereof. He
submitted that the Competent Authority is required to satisfy only with
regard to existence of statutory conditions namely whether there has
been default in payment of rent compensation or any amount lawfully
due for the particular period and upon so satisfied, to issue notice
calling upon the occupant to show cause against eviction. He submitted
that statutory scheme does not confer upon Competent Authority any
adjudicatory jurisdiction to re-open, re-assess, revise or determine
correctness of quantum of rent, compensation or other amounts
claimed by the Board. He submitted that the inquiry under Section 66
does not extend to determination of legality, propriety or re-calculation
of amount itself and any such exercise amounts to traveling beyond the
jurisdiction.
4.3.            He submitted that section 69 of the said Act circumscribes
the power of the Competent Authority under Section 66 and confers
limited powers akin to those of Civil Court namely power to summons
and enforce the attendance of the witness, required discovery of
production of documents and exercise such other powers as may be
prescribed. He submitted that these powers are merely incidental to
effective conduct of inquiry and cannot be construed as enlarging the
jurisdiction.


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4.4.             He submitted that the legislative intent is further evident
from Section 70 of the said Act which provides statutory remedy of
appeal against order passed by the Competent Authority, which the
legislature has consciously provided as limited and expeditious
appellate mechanism. He submitted that under Section 70(5), such
appeals are supposed to be disposed of expeditiously. That therefore,
the statutory framework demonstrates the proceedings are intended to
be summary and time bound. He submitted that permitting either
Competent Authority or Appellate Authority, to adjudicate on quantum
of dues would not only be contrary to express scheme of the Act but
would frustrate the legislative purpose behind it.
4.5.             He submitted that price fixation at a particular point of
time is a complex function and is undertaken by the Board by
considering various parameters involved, such as premium on land,
legal and other incident expenses including supervision charges. He
submitted that the Board has therefore adopted the method of interest
capitalisation by charging interest from July 1987 onwards.
4.6. He lastly submitted that the Respondent was a President of the
Housing Board at the relevant time and had full knowledge of the rules
and regulations and therefore, cannot claim protection of ignorance.
That partial payment made by Respondent does not create any equity.
4.7.             He relied on page No. 54 of the petition by which
calculations are submitted, which according to Petitioner, are lawfully
due. He submitted that therefore, eviction notice sent to Respondent as
well as the payment of Rs.5,51,000/- are required to be upheld and the
impugned order of the Appellate Authority is required to be set aside.


5.             On the other hand, Mr. Mulye appearing for the Respondent
submitted as under.


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5.1.           He submitted that the Competent Authority can consider
what is the amount lawfully due and it cannot be said that the
calculation made by the Board cannot be gone into. That if such
interpretation is accepted, then the concerned officers may charge
exorbitant amounts and the Competent Authority will be precluded
from going into its legality, which can not be legislative intent.
5.2.           He submitted that no intimation was given to Respondent
about amount payable by him or about price fixation, till the
letter/notice was issued in May 1995 and therefore, the Respondent
cannot be held liable to pay interest till such time. He further submitted
that in any case no interest can be charged till the time suit flat was
allotted to him i.e. till July 1993.
5.3.           Relying on Regulation No. 16, it is submitted that the suit
flat is allotted to Respondent as per direction of the State Government
and therefore the directions under allotment letter must prevail.
Inviting the Court's attention to allotment letter dated 26.07.1993, he
submitted that the Board was directed to complete the formalities and
immediately allot the suit flat and since no price was fixed or terms and
conditions were informed before putting the Respondent in possession
of suit flat, the Petitioner cannot subsequently imposed terms and
condition or interest on the price of the suit flat. He further submitted
that the amount payable or interest thereon was never communicated
to the Respondent till May, 1995, when the price was informed as
Rs.5,51,000/-.
5.4.           He submitted that in any case, right from the stage of filing
reply, Respondent has shown willingness to pay and has in fact paid
amount as per calculation of the Competent Authority. That therefore
the Respondent should not be evicted.



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                          REASONS AND CONCLUSION
6.             I have considered the rival submissions carefully and perused
the record.
7.             It is important to note in the beginning that under allotment
letter dated 26.07.1993, though a direction was given to MHADA for
immediate allotment and handover of suit flat, it was directed that
formality be completed and initial deposit amount be secured. The same
allotment letter directed the Respondent to contact the Chief Executive
Officer of the Petitioner-Board about ‘actual terms and conditions for
payment of money’. The Respondent is taking a convenient stand that
once the suit flat is allotted, the Petitioner cannot demand the price or
other components including interest from the Respondent. It does not
stand to reason that when a flat is allotted to a citizen under order of
the Government from per-cent quota, he will not be asked for amount
legally due, including the price and other components such as interest.
The allotment letter does not indicate any concession given to the
Respondent about price or other components such as interest. In fact,
the allotment letter expects the Respondent to meet the Chief Executive
Officer for particular terms and conditions about payment of money.
Nothing is brought to the notice of the Court that the Respondent
contacted the CEO of the Board to understand the terms and conditions.
It cannot be accepted as legal argument that the allottee will not abide
by the terms and conditions of the allotment and claim that whatever
initial deposit or payment is made according to his own sweet will,
should suffice and legally due amount should not be asked for.
8.             Perusal of Section 66(1) of the said Act provides that the
Competent Authority has power to evict certain persons if it is satisfied
that the person authorized to occupy any authority premises (i.e.


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allottee) has not paid ‘amount lawfully due’ from him in respect of such
premises for a period of more than 2 months. The Respondent squarely
falls under Section 66(1)(a)(i) of the said Act.


9.             Now let us consider the argument of learned counsel for the
Petitioner that the Competent Authority has no jurisdiction to re-open,
re-assess, revise or determine correctness of quantum and cannot
adjudicate the amount lawfully due. Having considered provisions of
Chapter VI i.e. sections 65 to 72 of the said Act, in my view, this
argument is not well-founded, for following reasons.
9.1.             Section 65 of the said Act provides that Competent
Authority is not below the rank of ‘Deputy Collector or Civil Judge’.
9.2.             Section 66 of the said Act provides for various grounds of
eviction; such as non payment of rent, compensation or amount
lawfully due, subletting without permission of authority, committing act
destructive or injuries to the premises, making material addition and
alteration to the premises, act of contravention of terms of occupation,
failure to vacate for the purpose of implementing any plan or project,
being in unauthorised occupation. The Competent Authority can issue
notice asking a person to vacate the premises. It is further provided that
before an order of issuing notice to vacate, the Competent Authority is
required to issue notice specifying ground on which eviction is
proposed and required the person concerned to show cause against
proposed order. It is also provided that if a person seeks extension of
period then the Authority may grant such extension on deposit of
money. Written statement is provided to be filed by the person before
Competent Authority by Advocate or legal practitioner. If the person
refuses or fails to comply with the order, then eviction by use of force is
also provided. Only for the purpose of apportionment of balance


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amount payable, a reference to Civil Court is provided. The word
‘lawfully’ used in section 66(1)(a)(i) itself indicates that if any amount
is demanded as due, then it has to be ‘lawfully due’. If the competent
authority is empowered to evict the allottee on the basis of non
payment of such dues, then ‘whether an amount is lawfully due or not’
becomes the basis of such eviction.
9.3.           Section   67   provides   for   power      to    recover      rent,
compensation, amount or damages as arrears of land revenue.
9.4.           Section 68 provides for rent, compensation or amount to be
recovered for deduction from salary or wages in certain cases.
9.5.           Section 69 provides that 'Competent Authority to have
powers of Civil Courts'. It provides that the Competent Authority, for
the purpose of holding inquiry have the same powers as are vested in
Civil Court, under the Code of Civil Procedure, 1908, when trying a suit
in respect of summoning and enforcing attendance of any person and
examine on oath, requiring the discovery and production of documents
and any other matter which may be prescribed.
9.6.           Section 70 deals with appeals, where it is provided that an
appeal shall lie from every order of the Competent Authority under
Section 66 and 67 of the said Act to the Appellate Officer. It is further
provided that the Appellate Authority shall be a person not below the
rank of Deputy Secretary to Government having judicial department of
the State or a person who has for at least 10 years held any judicial
office.
9.7.           Section 71 of the said Act bars the jurisdiction of the Civil
Court to entertain any suit or proceedings in respect of eviction of any
person or recovery of arrears of rent, compensation, amount or
damages or in respect of order made or action taken by Competent
Authority or the Appellate Authority.


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9.8.             Section 72 contemplates penalty for obstructing lawful
exercise of powers under the said Chapter and on conviction such
person can be punished with fine.
9.9.             Considering the above entire scheme of Chapter VI of the
said Act, it is a code in itself for the purpose of eviction from authority
premises and for recovery of dues. The jurisdiction of Civil Court is
barred. Therefore, if the power of the Competent / Appellate Authority
is interpreted in a restricted / limited manner, as suggested by learned
Counsel for the Petitioner, the allottee will be left in a situation where
no authority under the said Act will have power to scrutinize whether
the amount claimed by the officers of the Board is lawfully due or not.
Such interpretation will result in unchecked powers with the officers to
demand unlawful dues. Such interpretation can not be countenanced.
Therefore, the argument of the learned Counsel for the Petitioner about
restricted jurisdiction of Competent Authority or Appellate Authority is
rejected.
9.10             In that view of the matter, it is not possible to accept that
the Competent / Appellate Authority can not go into calculation of
amount lawfully due which is the basis of the eviction.
10.                Now returning to the case in hand. The Competent
Authority has considered that the suit flat was allotted without fixing
any price and even deposit amount was not fixed. The Competent
Authority has rightly considered that it does not necessarily mean that
the allotee was expected not to pay anything to the Board towards
purchase price of the suit flat. Therefore, it is rightly held that merely
because price was not fixed earlier, it would not absolve the Respondent
from liability to pay.
11.            The Competent Authority has considered that allotment is of
the year 1993 and therefore the interest till such date cannot be


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recovered from the Respondent. In this respect, it is important to note
that the price of suit flat in 1987 is taken as Rs. 1,41,130/-. So it does
not stand to reason that till 1993, that is even after a gap of 6 years, at
a location like Kothrud-Pune, the price will remain the same and
nothing can be added on the said price from 1987 till 1993 when it was
allotted to Respondent. The Petitioner Board has applied the method of
interest capitalization for arriving at the price in 1993. Considering that
interest @ 12.5% p.a. is added coupled with the time period involved,
from 1987 till 1993, when the prices of real-estate in the concerned
area was increasing, especially after 1991 when economic liberalization
happened, the method or percentage can not be called without basis or
illegal.
12.            Regulation No. 17(1) contemplates that the authorized officer
is expected to send an intimation of allotment in Form-II to every
eligible Applicant and on receipt of such intimation, the allottee may
within a period specified in the letter, accept allotment of tenement in
Form-III and pay the amounts referred in Form-II. Perusal of Form-III
indicates that the allottee is expected to accept the offer of allotment on
terms and conditions set out in the Appendix to the letter in Form-II.
Perusal of Form-II indicates that eligibility to allotment is subject to
terms and conditions, as set out in the Appendix, and the payment can
be demanded for ‘cost of tenement’ together with ‘proportionate
amount of premium on the land’ and ‘other incidental expenses’. In the
present case, for reasons best known to the Petitioner- Board, may be
because of the allotment by the Government from per-cent quota, the
Petitioner neither issued any letter in Form-II as an offer/intimation, nor
the Respondent issued acceptance letter in Form-III.
13.            When it is a statutory requirement under the applicable
Regulations that the allotment is subject to terms and conditions and


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subject to payment demanded, mere direction by the State Government
that a tenement be allotted to particular allottee on completion of
formalities and acceptance of initial deposit amount, will not absolve
the Authority or the allotee from payment of amount lawfully due and
demanded. Afterall, the Petitioner deals with public money and the
Respondent cannot be allowed to claim any privilege so as to be not
bound by the Statutory Regulations. Government quota can secure entry
in the project, but price fixation and liability to pay can not be done
away with.
14.            Regulation No.15 provides that price at which tenement is
offered could vary in cases where considerable time has elapsed till
actual allotment. Regulation No. 22 provides for Regulation No. 22
provides that if expenditure incurred on supervision has increased the
cost of tenement, the Board shall be competent to revise the price
already specified in notice or agreement and all allottees               shall be
bound by such revision. It is material to note that this regulation starts
with non-obtante clause giving it overriding effect on earlier notice or
agreement.
15.            Mr. Warunjikar is therefore right in his submission that
payment can be demanded together with proportionate amount of
premium and other incidental expenses in view of time elapsed till
allotment.       Time   elapsed   has   direct   connection       with    market
appreciation. In my considered view, in a place like Kothrud-Pune, a
tenement constructed in 1987 and the land beneath therein can not be
expected to remain static in its value. It also can not be expected that no
expenses will be required as ‘incidental expenses’ for maintaining the
tenement from 1987 till 1993. Therefore, the increase in the price by
way of interest capitalization cannot be faulted.
16.            There is nothing on record to show that the Respondent


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contacted the CEO as was expected under the allotment order. There is
nothing on record to show that Respondent made any efforts to know
the terms and conditions of payment. In such circumstances, if the
Petitioner has issued letter/notice and demanded amount, such demand
cannot be faulted with. In that view of the matter, the Competent
Authority has erred in concluding that no additional amount can be
claimed from the Respondent towards interest capitalization from 1987
till 1993.
17.            The Appellate Authority has held that the law officer of the
Petitioner could not explain about charging of interest and therefore, it
is held that interest cannot be claimed. It is further held by the
Appellate Authority that the law officer could not explain the profit
added towards locational advantage. Even if the law officer could not
explain the charging of interest or locational advantage, it would not
have any bearing on the statutory requirement and the Regulations as
explained above.
18.            However if the Petitioner Board knew that price has not been
paid by Respondent even after allotment in July 1993, there is no
explanation why the Board remained silent till May 1995 to issue
notice. Therefore factoring in 2 months’ statutory period under section
66(1)(a)(i) from July 1993, the demand ought to have been made
immediately in September 1993. The Petitioner Board has waited till
May 1995 for reasons best known to them. Therefore Petitioner can not
claim interest from September 1993 till May 1995. However, from May
1995, when amount was demanded, considering that parties resorted to
legal action, interest @9% p.a. appears to be legal and valid.
19.            The Appellate Authority on finding that the Respondent has
already made payment to the Board as per determination by Competent
Authority, it is held that the eviction order has been rendered


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unjustifiable and therefore, it was set aside. Since it is found that the
amount demanded by adding interest and other incidental charges
cannot be faulted with, it is necessary that the Respondent pays
remaining amount also, albeit calculated in the light of what is observed
above.
20.            The Petitioner has given the cost of suit flat in a chart Exhibit-
F, wherein amount of interest capitalization is added and the amount of
Rs.51,000/- paid by the Respondent is already adjusted.
21.            The Competent Authority had determined amount of Rs.
2,56,405/- considering 4 amounts, viz. price of flat, some interest, price
of furniture and interest on price of furniture. It appears that this
amount is made good by the Petitioner after adjusting amount paid
already by him. So far as the demand towards furniture cost or interest
thereon is concerned, the same is not seriously pressed by the learned
counsel for Petitioner. Therefore said heads are not being considered.


22.            Considering that the Respondent is occupying and residing in
the suit flat ever since 1993, it will be unjust to pass an order of eviction
after so many years, without an opportunity to pay balance amount. In
that view of the matter, in the interest of justice, Respondent is directed
to pay the remaining amount and continue with the possession, subject
to such payment. The amount is reworked in following manner.

            Event               Date                      Effect                        Amount
      Flat constructed.       July 1987    Initial cost                           1,41,130/-
       Flat allotted to       26.07.1993   (add) 12.5% p.a. interest from         1,07,259/-
        Respondent                         July 1987 till July 1993
                                           (as calculated by Petitioner)
                                                      Sub-total                   2,48,389/-
 Payment by Respondent        29.07.1993                  (less)                  11,000/-
 Payment by Respondent        10.06.1994                  (less)                  40,000/-
                                                    Balance due                   1,97,389/-


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Amount demanded by           24.05.1995    (add) Interest @9% p.a. (Rs.         14,800/-
Petitioner       therefore                 1480/- p.m. x 10 months) from
interest starts.                           May 1995 upto February
                                           1996 when amount was
                                           determined by Competent
                                           Authority
                                                     Sub-total                  2,12,189/-
Approximate        amount      Shortly                 (less)                  *1,21,939/-
seems to be paid by           thereafter
Respondent towards cost                                                        *(1,41,130/-
and interest (furniture                                                         + 31,809/-
price and interest thereon                                                      - 50,000/-)
not considered)
                                                   Balance due                  90,250/-
                             From June     (add) Interest @ 9% p.a. (Rs.        2,51,797/-
                                1995       8,122.5/ - x 31 years) from
                                           June 1995 till today
                                           Total amount due, as on today        3,42,047/-


23.            In that view of the matter, the petition partly succeeds.
Respondent is directed to pay remaining amount of Rs.3,42,047/- to the
Petitioner within a period of 2 weeks from today. Subject to such
payment, the Respondent can continue to occupy the suit flat. If amount
is not paid as directed, the Petitioner is at liberty to press for eviction.
24.            Rule is made partly absolute and writ petition is disposed of in
above terms. No order as to costs.
25.            All concerned to act on duly authenticated or digitally signed
copy of this order.


                                                       (M.M. SATHAYE, J.)




Sneha Chavan                                                                     16