Holding

The Chairman's letter was not a decision of the Trust; the Single Judge's findings were erroneous; the appeal is partly allowed, setting aside those findings.

Summary

The Ludhiana Improvement Trust acquired 8.4 acres of land owned jointly by five respondents and framed the 1964 Land Disposal Rules, which allowed only one plot per local displaced person. The respondents claimed that each joint khata holder was entitled to a separate plot, relying on a letter dated 19‑Aug‑1994 from the Trust's Chairman stating that each joint holder was entitled to a 500‑sq‑yard plot. The High Court directed the Trust to decide the representation but did not determine entitlement; a contempt petition later led a Single Judge to find that the Trust had accepted the claim and that the respondents could proceed against the Trust if plots were not allotted. On appeal, the Supreme Court held that the Chairman's letter was merely a response to a government query and not a binding decision of the Trust, and that the Single Judge erred in recording findings on the merits. Consequently, the findings of the High Court were set aside and the appeal was partly allowed.

Issues considered

Whether the Chairman's letter of 19‑Aug‑1994 constitutes a decision of the Ludhiana Improvement Trust to allot separate plots to each joint khata holder.
Whether the respondents are entitled to one plot each under the 1964 Land Disposal Rules or only a single plot per joint khata under the 1983 Rules and the 1995 government notification.
Whether the Single Judge of the High Court erred in recording findings on the merits and granting the respondents liberty to proceed against the Trust.
Whether the High Court's direction to the Trust to decide the representation without determining entitlement was appropriate.

Legislation cited

Subjects

land acquisitionimprovement trustjoint khataallotment of plotsinterpretation of rulescontempt of courtadministrative law

Judgment

A CHAIRMAN, LUDHIANA IMPROVEMENT TRUST
v.
KANWALJIT SINGH AND ORS.

FEBRUARY ·4, 2004

B [R.C. LAHOTI AND ASHOK BHAN, JJ.]

land Acquisition:

Ludhiana Improvement Trust land Disposal Rules, 1964-Rules 5(ii)
C and 6-land acquired from joint holders by Trust-Joint holders claiming
that each of them entitled to allotment of plot in lieu of land acquired-
Representation-local Government seeking information-Chairman of Trust
by letter replying that each holder entitled to plots-Writ petition seeking
allotment of separate plots-Division Bench of High Court directing Trust to
D decide representation and allot plot if entitled subject to the availability of
plots-Inaction on the part of Chairman-Contempt petition against
Chairman-Single Judge of High Court discharging the Chairman and
recording thai Trust had accepted the claim of holders for allotment of
separate plots-Justification of-Held: Correspondence exchanged between
E the G9vernment and the Chairman cannot be treated as decision taken by
Trust to alloi .each holder a plot-Also for deciding representation number of
"""'\.
questions have to be considered-Single Judge erred in recording the finding
which is set aside.

Appellant-trust framed Ludhiana Improvement Trust Land Disposal
F Rules, 1964. As per the Rules not more than one plot of land when
demarcated into plots was to be sold to local displaced person being the
person whose land was acquired by the trust. In March 1975, appellant-
{

trust acquired 8.4 acres land owned by respondents as joint holders in a
khata for construction of four storeyed flats. Thereafter, in September,
1975, Utjlization of Land and Allotment of Plots and Improvement Trust
G Rules, 1975 was framed. Subsequently, Punjab Town Improvement
(Utilisation of Land and Allotment of Plots) Rules, 1983 were promulgated
,.'
which provided that only one plot can be allotted to the joint holders of a
Khata. in the acquired land. In 1988 respondent made a representation •
claimin' that each of them be allotted one plot. Appellant submitted that
H 88
!;

CHAIRMAN, LUDHIANA IMPROVEMENT TRUST v. KANWAUIT SINGH 89

as no plots had been carved out in the scheme, flat's could be allotted to A
them. Local Government then sought clarification from the Trust
regarding respondents' claim. Chairman of appellant-trust replied to the
Local Government by letter dated 19.8.1994 that every joint holder is
entitled to be allotted a plot. Respondents filed writ petition praying for
allotment of separate plots. Writ petition was disposed of directing the B
Trust to decide the representation and allot plots if found entitled in view
of the availability. Respondents again filed a representation. Thereafter,
the Government issued notification clarifying that only one plot could be
allotted to joint Khata holders. Chairman again did not accede to the
request. Respondents filed contempt petition against the Chairman. Single
Judge of High Court discharged the Chairman and recorded a finding that C
in view of the letter the respondents were entitled to fiv.e plots and that if
the respondents despite their entitlement are not being allotted the plots,
they shall be at liberty to proceed against the Trust or Chairman in
accordance with law. Hence the present appeal.

Appellant-Trust contended that the Single Judge of High Court erred D
in recording the finding that in view of the letter by the Trust respondents
were entitled to five plots and if despite their entitlement they arc not
allotted the plots, they shall be at liberty to proceed against the Trust or
Chairman; that the letter of Chairman prior in time to the directions
issued by the High Court in writ petition could not be made the basis for E
recording a finding that the Trust had accepted or endorsed the·claim of
the respondents for allotment of one plot each.

Respondents contended that their claim was to be determined in
accordance with 1964 Rules and since the Chairman of the Trust in
response to a letter written by the Government had accepted that each of F
the joint holder in the joint Khata was entitled to the allotment of a
separate plot they had become entitled to the allotment of five plots.

Partly allowing the appeal, the Court

HELD: 1.1. Letter dated 19.8.1994 was written by the Chairman of G
the trust in response to the query made by the State Government. Based
on this letter writ petition was filed in the High Court for issuance of a
mandamus to direct the Trust to allot one plot to each of the holders of
the joint Khata. Thus, the letter could not be taken as a decision of the
Trust to allot one plot to each of the joint holder in a Khata. Division H
90 SUPREME COURT REPORTS f2004l 2 S.C.R.

A Bench while disposing of the writ petition did not issue mandamus but
instead directed the Trust to decide the representation and allot the plots
· . if found entitled subject to the availability of the plots as on the date of
the passing .of the order. The entitlement of the respondents to get plots
was not determined. Aggrieved against this in.action contempt petition was
filed. The finding recorded by the Single Judge hearing the contempt
B petition that the entitlement of the respondents for allotment of plots had
already be~n decided is without any basis. The liberty reserved with the
respondents to proceed against the Trust or the new Chairman for not
allotting the plots despite their· entitlement to get the plots is based on
wrong assumption of the fact that the Trust had endorsed the claim of
C the respondents to get five plots being the holders of joint khata. Single
Judge should have closed the matter instead of proceeding to decide the
rights of the parties as if he was hearing the writ petition. 196-B-C-EI

1.2. Correspondence exchanged between the State Government and
the Chairman ~fthe Improvement Trust could not be treated as a decision
D taken by ~he Trust to allot five plots to the respondents. Even according
to the Ludhiana Improvement Trust Land Disposal Rufos, 1964 (Rule 6)
the Chairman of the Trust could seil the plots subject to confirmation by
the Trust. As the Trust had not taken the decision to allot 5 plots to the
respondents the finding recorded by the Single Judge was not sustainable.
E 196-F; 97-CI

CIVIL APPELLATE JURISDICTION : Civil Appeal No. I 077 of
1998.

From the Judgment and Order dated 13.2.97 of the Punjab and Haryana
F High Court in C.O.C.P. No. 991 of 1995

Naresh K. Sharn1a for the Appellant.

Stidhir Chandra, l.S. Alag, J.S. Lamba and Pradeep Kumar Bakshi for
the Respondents.

G The Judgment of the Court was delivered by

BHAN, J. I. Ludhiana Improvement Trust, Ludhiana, (hereinafter
referred to as ''.the appelllant") acquired SA acres Ian~ owned by the
respondents as joirit holders in a khata in the month of March 1975. The land I
H was acquired for construction of four storeyed flats. Under th~ scheme prepared
\./
CHAIRMAN. LUDHIANA IMPROVEMENT TRUST v. KA NW AL.HT SINGH [BHAN. J.] 9J

by the trust no individual plots were to be carved out. A
2. Appellant had framed 'The Ludhiana Improvement Trust Land
Disposal Rules, 1964' (hereinafter referred to as "the 1964 Rules"). Local
displaced person was defined to mean a person whose land was acquired by
the Trust for the execution of a scheme under the Punjab Town Improvement
Act, 1922 (hereinafter referred· to as "the Act"). Rule 5 (ii) provides that the B
Trust would fix a concessional price at which land comprised in a scheme
will be sold to a local displaced person. The concessional price was not to
be less then the cost price of the land, i;e. the estimated cost of acquisition
of the land plus development charges etc. Not more than one plot of land
when demarcated in to plots, was be sold to a local displaced person. Rule C
6 provides for issuance of a public notice in an appropriate form in the
prescribed manrier inviting applications from the Local displaced person. The
Land Officer after making enquiries as deemed fit as to the correctness of the
statements made therein was to submit all the applications received upto the
. last date fixed for this purpose to the Chairman who in turn could sell the
land to the applicants subject to confirmation by the Trust at the concessional D
price fixed by it under Rule 5 (ii).

· 3. In September 1975, the State of Punjab framed the Utilisation of
· Land and Allotment of Plots and Improvement Trust Rules, 1975 (hereinafter
referred to as "the 1975 Rules"). Subsequently in 1983 Punjab Town
Improvement (Utilisation of Land and Allotment of Plots) Rules, 1983 E
(hereinafter referred to as "the I983 Ru !es") were promulgated which provided
that only one plot can be allotted to the joint holders of a Khata in the
acquired land. On 17.8.1988 Respondent Nos. l to 5 who were the joint
.Khata holders of the acquired land made a representation to the State of
Punjaq to allot one plot to each one of them. Som~ correspondence was F
exchanged between the appellant and the Respondents. The stand being taken
by the appellant was that the respondents could be allotted flats and not plots
as no plots had been carved. out. in the .scheme. On 5.8.1994 Department of
Local Government Punjab wrote a lette_r to the Improvement Trust, Ludhiana
seeking certain information regarding the claim of Respondents I to 5 for
allotment of plots to them, which was replied to by the then Chairman of the G
appellant Trust on 19 .8.1994 which reads as under:

H
92 SUPREME COURT REPORTS [2004] 2 S.C.R.

A "OFFICE OF IMPROVEMENTTRUST, LUDHIANA

To
The Director
Depa11ment of Local Govt.,
Punjab,
B
Chanidgarh

Memo No. LIT/7059 dated 19.8.1994

Sub: Regarding allotment of L.D.P. to Shri D.S. Grewal, IPS, Attorney
c Ref: Your letter No. 5/400/94-2 JG 11/9032 dated 5.8.1994 on the
above noted subject.

The requisite inforrnation, as asked for, is given below:-

(I) That 8.4 Acre Scheme of the Trust under Section 36 was published
D on 263.1975 and, as per this Scheme, 1964 Rules are applicable
for L.D.P. allotments.

(2) That there is no record available. in the office for inviting
applications from the L.D.Ps. under this Scheme and earnest
money was deposited by them on 26.12 .1985 and 02.1.1986.
E (3) That according to Land Disposal Rules, 1964, every joint Khata
Holder is entitled for allotment of 500-500 sq. yards plot according
to which all the five applicants are entitled to have 500-500 sq.
ya~d plot each.

Sci/-
F President
Improvement Trust
Ludhiana
19.8.94"
4. Basing their claim on this letter the respondents filed Civil Writ
G Petition No. 13980 of 1994 seeking its implementation and inter alia praying
for allotment ·of five separate plots. This writ petition was disposed of by a
Divisio~ Bench on 30.9.1994 without issuing notice to the respondents (the
appellant herein) by observing thus:

H
"The respondents are directed to decide the representation of the
petitioners by passing a speaking order. In case the petitioners are
I
CHAIRMAN, LUDHIANA IMPROVEMENT TRUST v. KANWAL.llT SINGH [BHAN, J.) 93

found entitled to the allotment of plot(s) in accordance with the rules/ A
regulations being 'displaced persons', appropriate relief may be granted
to them. The respondents shall ensure that ifthe petitioners are entitled
to the allotment of plot(s), the same would be allotted irrespective of
fact whether the allotment has· already been made or not keeping in
view the availability of plot as today.
B
With the said observations, the writ petition is disposed of."

5. On 6.10.1994, respondents filed a representation seeking for allotment
of five separate plots. On 2.5.1995 the Government of Punjab issued a
notification vide memo No. 51245195 2DGHil/6195 mentioning therein that
there was some ambiguity in the 1964 Rules regarding the number of plots C
to be allotted to the joint holders of a Khata of the land acquired. It was
clarified that only one plot could be allotted to the joint Khata holders of the
land acquired. The relevant portion of the said notification reads:

"In 43 cases, more than one plot has been allotted against a Joint- D
Khata., These allotments have been made under 'The Ludhiana
Improvement Trust Land Disposal Rules, 1964 ',which are ambiguous
.,
on this point. Under the Punjab Town Improvement (Utilisation of
Land and Allotment of Plots) Rules, 1983 which are operative now,
only one plot can be allotted against a joint Khata. Therefore, these
allotments are not in accordance with the rules and deserve to be E
cancelled by following the procedure as laid down under the Rules.
However, it has been noted that in cases, as detailed in Annexure 'C'
where payments have been fully/partly made, agreements etc. have
also been executed and possession have als9 been delivered, in such
cases cancellation though technically right would only be a paper
cancellation and lead to prolonged litigation. As a one time measure, F
therefore, such cases of allotments of more than one plot to a joint
khata holder where possession has been delivered, payments have
been fully or partly accepted and agreements etc. has been entered
into, allottees may be given an offer tv have this allotment regularised
on payment of market price prevailing on the date of allotment, which G
would be assessed by the Deputy Commissioner. This is only a one
time measure and would not be a precedent for dealing with similar

- cases in future. In the remaining cases where no payment has been
made nor any document has been executed nor possession delivered
and allotments may be cancelled by following procedure as laid down
H
94 SUPREME COURT REPORTS [2004] 2 S.C.R.

A under the rules."

[Emphasis supplied]

6. The appellant did not accede to the request made by th.e respondents
for allotment of five separate plots to them. According to the appellant under
B the. Scheme and the Rules the respondents were entitled to get one flat allotted
to them and not flats/plots, as claimed by them as no plots had been carved ...
I
out under the scheme . I
\
7. On 29.8.1995 respondents filed contempt petition No. CCOP No.
991 of 1995 against Surinder Aggarwal, the then Chairman of the appellant
C Trust. Contempt Petition was disposed Of or:i 13 .2.1997. Respondent Chairman
of the Trust was discharged of the allegation made against him by observing
that the respondent had already accepted the position taken by the writ
petitione~s (Respondents herein) that they were entitled to the allotment of
five plots in lieu of land acquired by his letter dated 19.8.1994. Whatever
D was possible had already been done by the Chairman in compliance with the
directions issued by the High Court by its order dated 30.9.1994 in C.W.P.
No. 13980of1994. In the body of the order the learned Single Judge recorded
a finding that the trust by its letter No. LIT - 7059 dated 19.8.1994, has
admitted that the respondents were entitled to the plots in lieu of the land
acquired by the Trust." It was held:
E
"I find that the Trust vide letter No. LIT-7058 dated 9.8.1994 (sic)
f
addressed to the Government of Punjab admitted and accepted the
position that petitioners are entitled to five plots in lieu of their land I I
acquired by the Trust."

F In the concluding portion the learned Single Judge held:

"If the petitioners are still aggrieved of the action of the Trust or the
action of the present Chairman of the Trust that despite their
entitlement in regard to allotment of plot(s) they are not being allotted
the same, they shall be at liberty to proceed against the Trust or the
G present Chairman in accordance with law."

8~ Aggrieved by the afore:;aid two findings recorded by the learned
(,
Single Judge the present appeal has been filed. According to the appellant the
learned Single Judge gravely erred in recording the above said two findings.
· .Trust had neither accepted nor endorsed the claim. of the respondents that
H they were entitled to five separate plots in lieu of the land acquired from
CHAIRMAN, LUDHIANA IMPROVEMENT TRUST v. KANWAL.llT SINGH [BHAN, .I.] 95

them. That the letter of the Chairman dated 19.8.1994 was prior in time to A
the directions issued by the High Court on 30.9.1994 in C. W.P. No. 13980
of 1994. The letter written prior to the directions issued on 30.9.1994 could
not be made the basis for recording a finding that the Trust had acct>pted or
endorsed the claim of the respondents for allotment of one plot each of the
five joint holders of the Khata of the land acquired.
B
9. As against this the stand taken by the respondents is that their case
wouid not be governed either by the Rules of 1983 or by the instructions
issued by the Government on 7.1.1995. According to them their claim was
to be determined in accordance with 1964 Rules and since the Chairman of
the Trust in response to a letter written by the Government had accepted that C
each of the joint holder in the joint Khata was entitled to the alJotment of a
separate plot they had become entitled to the allotment of five plots.

- I0. Counsel for the parties have been heard at length. The record has
been perused.

11. We find force in the submissions made by the learned counsel for
D
the appellant. Letter dated 19.8.1994 could not be taken as a decision of the
Trust to allot one plot to each of the joint holder in a Khata. This letter was
written by the Chairman of the Trust in response to a query made by the State
Government. Based on this letter Civil writ petition No. C.W.P. 13980 of
1994 was filed in the High Court seeking a mandamus directing the E
respondents to allot five plots (one each to the five joint Khata holders). The
Division Bench without issuing notice to the respondents in the High Court
issued a direction to the appellant Trust to decide the representation of the
respondents and if found entitled to the allotment of the plots, then, they be
allotted plots keeping in view the availability of the plots as on the date of F
the passing of the order. It was conceded by the counsel for the parties that
the representation filed by the respondents has n~t been decided. Aggrieved
against this inaction of the Chairman of the Improvement Trust, petition
under the Contempt of Courts Act, 1971 was filed for taking suitable action
under the Act against the Chairman of the Trust. Learned Single Judge
exonerated the Chairman of the Trust of the charge levelled against him but G
proceeded to record findings on merits regarding the entitlement of the
respondents to get the plots and reserving liberty with them to proceed against
..... the Trust or the present Chairman for not allotting plots to them despite their
entitlement in accordance with law. "Civil Contempt" means wilful
disobedience to any judgment, decree, direction, order, writ or other process
H
96 SUPREME COURT REPORTS 12004] 2 S.C.R.

A of a court or wilful breach of an undertaking given to a Court. The appellant
Trust and the Chairman were exonerated of the charge of wilful disobedience
of the directions issued by the High Court. On the recording of this finding
t~e learned Single Judge hearing the contempt petition should have closed
the matter but instead of doing that the learned Single Judge proceeded to
B decide the rights of the parties as if he was hearing the writ petition.

12. Letter dated 19.8 . .1994 written by the Chairman was prior in time
to the order passed on 30.9.1994 in the writ petition. ~n fact, the letter dated
19 .8 .1994 was the basis on which the writ petition was filed in the High
Court for issuance of a mandamus to direct the Trust to allot one plot to each
C of the holders of the joint Khata. The Division Bench while disposing of the
writ petition did not deem it appropriate to issue a mandamus as prayed for
but instead directed the Trust to decide the representation and allot the plots
if found entitled subject to the availability of the plots as on the date of the
passing of the order. The entitlement of the respondents to get plots was not
determined. The finding recorded by the learned Single Judge hearing the
D contempt petition that .the entitlement of the respondents for allotment of
-
plots had already been decided is without any basis. The liberty reserved with
the respondents to proceed against the Trust or the new Chairman for not
allotting the plots despite their entitlement to get the plots is based on wrong
assumption of the fact that the Trust had endorsed the claim of the respondents
E to get five plots being the holders of joint Khata.
13. Correspondence exchanged between the State Governme~t and the
Chairman of the Improvement Trust could not be treated as a decision taken
by the Trust to allot five plots to the respondents. Even according to the 1964
Rules (Rule 6) the Chairman of the Trust could sell the plots subject to
p confirmation by the Trust. Trust· has not taken any decision so far. The
Scheme prepared for development of 8.4 acres of land acquired for the
construction of four storeyed flats has not been placed on record. While
deciding the representation a host of questions would arise including (i)
whether the application filed by the respondents in the year 1988 was within
time?; (ii) whether the respondents would be entitled to pl9ts or flats?; (iii)
G whether they would be entitled to one plot/flat being the joint holders of the
Khata or to separate plots/flats (one each) as claimed by them?; (iv) whether
any applications were invited by the Trust from the Local displaced persons
in accordance with the 1964 Rules? (v) whether the respondents had put in
their claim in response to the said application?; (vi) As to which of the Rules 1
H of 1964, 1975 or 1983 would apply as respondents had filed the representation '
CHAIRMAN, LUDHIANA IMPROVEMENT TRUST''· KANWALJIT SINGH [BHAN, .I ) 97

in the month of 1988 for the first "time?; (vii) what would be the effect of the A
clarificatory notification issued by the Goverriment on 7.1.1995 stating therein
that co-sharers of the joint khata ofthe land acquired would be entitled to get
one plot only and not separate plots to each of the co-sharers and (viii)
availability of the plot/flat as on the date of the· passing of order.

14. For the reasons stated above, it is held that that learned Single B
Judge erred in holding that the Improvement Trust had either accepted or
endorsed the c Iaim of the respondents for allotment of separate plots to each
of the joint holders of the khata of the land acquired. Learned Single Judge
further erred in holding that the respondents were at liberty to proceed against
tbe Trust or the present Chairman in accordance with law in case plots were C
not allotted despite their entitlement to the allotment of plots.

15. For the reasons stated above, the findings recorded by the High
Comt which are reproduced in paragraph 7 are set aside and appeal is allowed
to that extent. Parties shall bear their own costs.
D
N.J. Appeal partly allowed.