Holding

The Full Bench of the Delhi High Court correctly held that the revision of land rates and consequent flat pricing was neither arbitrary nor illegal, and its decision is binding, setting aside the earlier Division Bench judgment.

Summary

The Delhi Development Authority (DDA) revised the land rates for its 1979 Registration Scheme on New Pattern in 1990, leading to higher flat prices. Several allottees filed writ petitions challenging the revision as arbitrary and illegal, resulting in conflicting judgments from two Division Benches of the Delhi High Court. The matter was referred to a Full Bench, which held that the revision was neither arbitrary nor illegal and that courts could not interfere with pricing under Article 226 given the contractual nature of the scheme. The Supreme Court noted that inconsistency between co‑equal benches must be resolved by a larger bench and that the Full Bench decision is binding on subordinate courts. Consequently, the Court set aside the earlier Division Bench judgment and disposed of the writ petitions in accordance with the Full Bench order.

Issues considered

Whether under Article 226 of the Constitution the court can interfere with the pricing/costing of flats, including land price escalation, under the Registration Scheme on New Pattern, 1979.
Whether the revision of land cost by the Lieutenant Governor of Delhi is illegal and arbitrary.
Whether a decision of a Division Bench of a High Court is binding when a Full Bench of the same High Court has decided the opposite view.
Whether inconsistency and contradiction in judgments of co‑equal benches should be resolved by a larger bench to ensure certainty.

Subjects

precedent valuebinding nature of lawdivision benchfull benchprice escalationurban developmentregistration schemeArticle 226judicial reviewprice fixationconflict of judgmentscertainty

Judgment

A DELHI DEVELOPMENT AUTHORITY
v.
ASHOK KUMAR BEHAL AND ORS.

AUGUST 20, 2002

B [V.N. KHARE, SHIVARAJ V. PATIL AND ASHOK BHAN, JJ.]

Precedent-Value and binding nature of-Law laid down by Division
Bench contrary to the law laid down by another Division Bench of the same
C High Court-Referred to Full Bench which resolved the conflict of views-
Held, decision of full court binding-Inconsistency and contradiction in the
orders passed by the same court should be avoided in order to bring about
certainty in the mind of subordinate courts and litigant public-Urban
Development-Escalation in price of flats-Justification oj

D Regarding registration of flats under Registration Scheme on New
Pattern, 1979, prices of the flats were revised by the appellant authority
in 1990. Respondent-allottees filed writ petitions in High Court challenging
the revised rate. A Division Bench of the High Court allowed the writ
petitions holding the revision of rate as arbitrary and illegal. However,
similar writ petitions were dismissed on merit by another Division Bench
E earlier.
In another set of writ petitions before High Court for similar relief,
it was prayed that the writ petitions be disposed of in terms of the
judgment impugned in the present appeal. In view of the divergent views
expressed by two different Benches of equal strength, the matter was
F referred to Full Bench.

In the present appeals, it was contended that the correctness of the
view expressed in the impugned judgment ought not to have been doubted.
The matter was adjourned· till the pronouncement of the Full Bench
G Judgment. Full Bench arrived at a conclusion contrary to the view
expressed by Division Bench in impugned judgment. However, Full Bench
observed that the Division Bench went into the question of escalation of
price because, Court's queries regarding the same, were not answered.
Special Leave to appeal against the decision of Full Bench was dismissed
in limine and so during the hearing of the present appeals, respondent-
H 622
DELHI DEVELOPMENT AUTHORITY v. ASHOK KUMAR BEHAL 623

allottees sought permission to file appeal and the permission was granted. A
Respondent-allottees contended that the view expressed in the
impugned judgment was not overruled by Full Bench; rather the same
was approved and that since Division Bench in the impugned judgment
decided the case on the peculiar facts of the case, the ratio of the decision
of the Full Bench Judgment is not applicable. B
Disposing of the appeals, the Court

HELD: I.I. The impugned judgment is set aside and the writ
petitions filed by the respondents are disposed of in terms of the order
passed by Full Bench of High Court. [631-B) C
1.2. The Full Bench did not approve the view expressed by the
Division Bench in the impugned judgment. It simply stated that the
Division Bench mighi have come to the conclusion because the Authority
failed to place the relevant "l"terial before the Court to explain how the D
price fixation had been done and on what basis. Court queries in this behalf
were not answered, which led to the belief that the appellant authority
was suppressing something and had acted arbitrarily to the prejudice of
the writ petitioners. The relevant material bad been placed before the
larger Bench and the Bench after taking into consideration the material
placed before it came to the conclusion that the revised price was neither E
arbitrary nor illegal. The inconsistency in the views expressed in the
impugned judgment and the larger Bench of High Court is self-evident.
High Court bas resolved the conflict of views expressed by the Division
Benches of co-equal strength by constituting a larger Bench and the special
leave petition filed against the judgment of the larger Bench has already F
been dismissed. (630-C, D, E)

Smt. Sheelawanti and Anr. v. D.D.A. and Anr., AIR (1995) Delhi 212
approved.

1.3. Inconsistency and contradiction in the orders passed by the same G
Court on the same point regarding the same scheme cannot be allowed to
be continued or perpetuated. If the plea of the respondents Is accepted
then an anomalous situation would arise by which the price fixed for few
of the MIG flats in the scheme would be much less than the price fixed
for the remaining flats allotted in the same year, which cannot be
permitted. The law laid down by the Supreme Court is binding on all H
624 SUPREME COURT REPORTS [2002] SUPP. l S.C.R.

A courts within the territory of India and the law laid down by a High Court
is binding on all courts within its jurisdiction. It is a cardinal principle of
rule of law that inconsistency and contradiction in the orders has to be
avoided at all costs to bring about a certainty in the mind of the
subordinate court and the litigant public. This principle would stand
B violated in case two binding principles on the same point of the same court
are al.lowed to operate simultaneously. (630-F, G, H; 631-A)

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 9802-9807
of 1995.

C From the Judgment and Order dated 25.8.1993 of the Delhi High Court
in C.W.P. No. 3267, 3198, 3456, 3645, 3795 and 3796 of 1991.

WITH

C.A. No. 9825 of 1995 ...
D Har Dev Singh, Ms. Indu Malhotra, Ms. Pooja, Dheeraj Nair, Ms. Deepa
Vishwanathan, Ms. Madhu Moolchandani, S.B. Upadhyay, (NP), V. Shekhar
(NP) and G.K. Bansal (NP) for the appearing parties

The Judgment of the Court was delivered by

E BHAN. J. Appellant - Delhi Development Authority (hereinafter
referred to as 'the Authority') formulated a Scheme known as "Registration
Scheme on New Pattern - 1997" (for short 'the~cheme') to build and sell
MIG/LIG and Janta flats so as to be within the reach of the common man.

F Registration for the scheme opened on 1st September, 1979. in the
scheme the illustrated price of various categories of flats were mentioned .
The likely cost of MIG flats with which we are concerned in these appeals
was indicated to be Rs. 42,000. On 30th of September 1979, registration was
closed. About I, 70,000 persons registered themselves in the scheme. In 1981,
allotment started taking plae<e by draw of lots based on randomised allotment.
G The cost of flats was worked out after taking into account the prevailing rate
of land by the Lt. Governor. The cost of construction was worked out by
dividing the cost incurred in construction of a pocket of flats by a number
of flats in that pocket. Clauses 13&14 of the brouchure are as follows:

"Clause 13. The plinth area of the flats to be constructed under new
H pattern is likely to be as under :-
DELHI DEVELOPMENT AUTHORITY v. AS HOK KUMAR BEHAL [BHAN, J.] 625

MIG Between 60 to 65 Sq. Mtrs. A
LIG About 38 Sq. Mtrs.

Janta Upto 24 Sq. Mtrs.

The accommodation in the flats under different categories will be as
under:- B
MCG One Living Room, 2 Bed Rooms, Kitchen, Bath Room and
W.C. and Open Court-yard.

LJG 2 Rooms, Kitchen, Bath Room and W.C.

Jania One room, Kitchen, Bath Room and W.C. c
The likely cost of flats constructed under this scheme will be as
under-

MIG Rs. 42,000

LIG Rs. 18,000 D
Janta Rs. 8,000

Tffe prices are indicative and do not represent the final cost.

14. It may please be noted that the plinth area of the flats indicated
and the estimated prices mentioned in the brochure are illustrative E
and are subject to revision/modification depending upon the exigencies
or lay out, cost of construction etc. " [Emphasis supplied]

Due to certain reasons with which we are not concerned at the moment,
the allotments could not be made. On 6th of December, 1990 fresh rates of F
land to be taken into account for costing of flats were approved by the Lt.

,
Governor. Whereas in 1979 the prevailing land rate was fixed at Rs. 62 per
sq. meter, the same was revised in 1990 to Rs. 870 per sq. meter for MIG
flats, Rs. 660 per sq. meter for LIG flats and Rs. 500 per sq. meter for EWS
(Jania flats). The increased rate was approved after taking into consideration
all the relevant factors involved. .G
The respondents-writ petitioners (hereinafter referred to as 'the
respondents') whose tum for allotment came in 1991 were allotted flats in
Jahangirpuri. The demand letters were sent to them. Respondents filed the
writ petition No. 3267 of 1991 along Civil Writ Nos. 3198, 3456, 3645, 3795
and 3796 of 1991 respectively in Delhi High Court challenging the rate at H
>,
626 SUPREME COURT REPORTS (2002] SUPP. 1 S.C.R.

A which the flats were being allotted. The case put up by them was that the
amount being charged for the flats was much higher than what was indicated "~·
in the scheme itself.

Writ Petition Nos. 3876 of 1992 titled Prem Chand v. Union of India
and Anr. CWP 2787of1990 J.K. Dhingra v. DDA, CWP 728of1991 Vinod
B Kumar Gupta v. ODA and CWP 1327of1991 Maha Nand Sharma v. DDA
also filed on the same grounds and for the same were dismissed on 24th May,
1993, 16th May, 1991, 22th October, 1991 and 15th January, 1992 respectively.

Writ Petitions filed by the respondents were allowed by the High Court
c despite the fact that several similar writ petitions had already been dismissed
on merits. By the impugned judgment the High Court struck down the revision
in the rate of land. The Authority was directed to make allotment of flats at
a tentative price of four and a half time of the price offer~d in the year 1979.
Further the Authority was directed to constitute an Expelt Committee to go
into the costing of the flats taking the land rate at Rs. 62 per sq. meter. The
D Expert Committee was to work out the price after taking into account the
actual cost of construction made by it for the construction of the flats. If the
Expert Committee after working out the cost on the basis of aforesaid works
out cost to be more than the price that was provisionally fixed then the
Authority was put at liberty to revise the cost and intimate to the respondents
requiring them to make the payment within a month of such intimation.
E
Another set of writ petitions 1121/91, 1102/93, 1059/94, 874/94, 1008/
94, 1019/94, 1451/94 and 1628 of 1994 which were for similar relief came
up for hearing before another Division Bench. Arguments were heard and
orders were reserved. A miscellaneous application being CM No. 6491 of
F 1993 was filed in writ petition No.1121 of 1991 to report that another Division
Bench had pronounced judgment in Writ Petition No. 3267 of 1991 (writ

G
petition filed by the respondents) on August 25, 1993 which had a direct
bearing on the controversy involved, in which similar issues had been
considered and decided. The relief similar to the one claimed in petition had
been granted. A prayer was made that the writ petitions be disposed of in
terms of the said judgment. On notice, the authority resisted the application
,I

swaying that important decisions vital to the issue raised had escaped attention
;.'
of the Court in CWP 3267 of 1991 and as such the same was not binding.
K~eping in mind the divergent views expressed by different Benches of equal
~ < strength, the Division Bench felt it appropriate that the matter be decided by
.H a larger bench and in particular the following questions :
DELHI DEVELOPMENT AUTHORITY v. ASHOK KUMAR BEHAL [BHAN, l.] 627

"I. Whether under Article 226 of the Constitution of India, this Court A
can interfere in the matter of pricing/costing of flats including
escalation in cost of land particularly in view of Clause No. 13 and
14 of the brochure regarding the Registration Scheme on New Pattern-
1979 under which the petitioners are registrants for allotment of flats?

2. ls the impugned revision of cost of land by the Lieutenant Governor B
of Delhi illegal and arbitrary?"

Thus, on their recommendation, a Full Bench was constituted to decide
the aforesaid questions.

The fact that the matter had been referred to a larger Bench doubting C
the correctness of the view expressed in the impugned judgment was brought
to the notice of this Court in the present appeals. This Court on 7th February,
1994 adjourned the case sine die to await the decision of the Full Bench and
passed the following order.'
D
"We are told at the bar that the instant decision under appeal has been
doubted by another Division Bench of the High Court. Apparently
there exists a conflict of opinion raging in the High Court on the
question raised herein. It appears that CWP No. 1121191 Sheela Wanti
v. Delhi Development Authority and Ors. batch cases stands referred
to a Full Bench by a order of a Division Bench dated 22nd September, E
1993. We feel that in this situation it would be appropriate that the
High Court itself puts to order its own views. We, therefore, send a
request to the Chief Justice of the High Court to constitute a Full
Bench, if possible, within 3 weeks and have the matter listed and
heard as expeditiously as possible. We on our part hold over this F
matter awaiting the decision of the Full Bench.

The matter is adjourned sine die with the liberty to mention.''

The authority filed a detailed affidavit before the Full Bench along with
the documents explaining as to how likely cost of the flats mentioned in 1979 G
was arrived at, the component of land price in the said cost, the basis thereof
and increase in the land price, if any, between 1979 and 1990. The basis on
which the price was enhanced was also indicated which ultimately resulted
in the issuance of the notification by the Lt. Governor of Delhi dated 6th
December, 1990 fixing the revised rates which was impugned in the writ
petitions filed in the High Court. H
628 SUPREME COURT REPORTS [2002) SUPP. l S.C.R.

A The points which were referred to the Full Bench were answered in the
negative, i.e. in favour of the authority and against the allottees. lt was held
that the scope of judicial review in the cases involving costing and fixation
of prices was very much limited.

In the concluding portions, the two points referred to the Full Bench
B were answered in the following terms :

"We may now advert to the questions referred to the Full Bench. In
keeping without observations and findings recorded above, we are of
the opinion that in view of Clauses 13 and 14 of brochure and the
transaction being contractual, this court cannot interfere under Article
c 226 of the Constitution in the matter of pricing/costing of flats,
including escalation of cost of land, etc. The answer to the first question
has to be in the negative.

As regards the second question referred to the Full Bench, as
D noticed above, we are of the view that the impugned revision of by
the Lieutenant Governor of Delhi is neither illegal nor arbitrary."

The decision of the Full Bench was challenged iii this Court by filing
Special leave petition (C) No. 13508 of 1995 and the same was dismissed on
14th July, 1995.
E
Special leave petitions in the present appeals were listed before the
Bench on 20th October, 1995. Counsel for the respondents raised an argument
that since the special leave petitions against the Full Bench judgment were
dismissed in limine, he would like to challenge the correctness of the Full
Bench judgment. Keeping in view this submission, this Court granted .the
F leave to file the appeals. The order passed by the Court is in the following
terms:

"Learned counsel for the petitioner submits that the impugned
judgment by a Division Bench of the High Court is contrary to the
subsequent Full Bench decision of the same High Court against which
G special t:.eave Petition has been dismissed by this Court. Learned
coun~el further submits that other similar SLPs were also dismissed
by this Court which amounts to affirmance of the Full Bench decision
dated 3th February, 1995 (at page 143-79 of the paper book). On the
other hand, learned counsel for the respondent submits that the
H dismissal of the SLPs being in /imine, he would like to challenge the
DELHI DEVELOPMENT AUTHORITY v. ASHOK KUMAR BEHAL [BHAN, J.] 629
correctness of the Full Bench judgment and therefore the hearing will A
take some time.

For the above reason, we grant special leave in all the special leave
petitions. In the meantime operation of the impugned judgment shall remain
stayed."
B
From the facts narrated above, it is evident that there was a difference
of opinion between co-equal benches of the High Court regarding fixation of
the price of MIG flats in the same scheme. Since there was a divergence of
opinion, the matter was referred to a Full Bench to resolve the conflict in the
views expressed. The conclusion arrived at by the Full Bench run contrary
to the view expressed by the Division Bench in the impugned judgments. C
Shri Hardev Singh, senior advocate appearing for the respondents
strenuously contended that the view expressed in the impugned judgment
before us was not overruled by the Full Bench, rather the same was approved.
Relying upon the following observations :
D
"The consistent view of this Court thus, was that escalation in prices
of the flats constructed by the DDA under different schemes, including
the present scheme, could not be challenged under Article 226 of the
Constitution till the decision in Ashok Kumar Behl v. DDA 52 (1993)
DLT 153, in which the Court went into the question of pricing and E
quashed the escalated price of the flats allotted under the scheme. It
appears that the Court did so apparently for the reason that despite
specific directions in that behalf the DDA had failed to place the
relevant material before the Court to explain how the price fixation
had been done and on what basis. Court queries in this behalf were
not answered, which led to the belief that the DDA was suppressing F
something and had acted arbitrarily to the prejudice of the writ
petitioners. These significant factors put the case out of the ambit of
the ratio of the Bareilli Development Authority's case."

It was stressed that since the DDA had failed to produce the relevant material
before the Court to explain how the price fixation had been done ratio of this G
Court's Judgment in Bareilly Development Authority v. Ajai Pal Singh, [1989)
1 SCR 743, was not dpplicable. That the Division Bench in the impugned
judgment decided the case on the peculiar facts of the case and therefore the
same would not be governed by the ratio of the decision of the Full Bench
judgment. H
630 SUPREME COURT REPORTS [2002] SUPP. I S.C.R.

A The contention put forth by the counsel for the respondents cannot be
accepted either on facts or in law. Keeping in mind the divergence of views
expressed by the co-equal benches the matter was referred to the Full Bench.
The Full Bench expressed the view that revision of price by the Lieutenant
Governor of Delhi in the year 1991 was neither arbitrary nor illegal, in the
B other words, the price fixed by the Lieutenant Governor in the year 1991 was
upheld whereas the Division Bench in the impugned judgment has taken a
dramatically opposite view. In the impugned judgment it has been held that
the price fixed by the Lt. Governor in the year 1991 was arbitrary and illegal.
The Court after fixing a tentative price directed to constitute an Expert
Committee to go into the question of pricing and determine the same after
C taking the land rate at Rs. 62 per sq; meter and actual cost of construction
.
made by it for the construction of the flats. The Full Bench did not approve
the view expressed by the Division Bench in the impugned judgment, it
simply stated that the Division Bench may have come to this conclusion
because the Authority failed to place the relevant material before the Court
to explain how the price fixation had been done and on what basis. Court
D queries in this behalf were not answered, which led to the belief that the
DDA was suppressing something and had acted arbitrarily to the prejudice of
the writ petitioners. The relevant material had been placed before the larger
Bench and the Bench after taking into consideration the material placed
before it came to the conclusion that the price fixed by the Lt. Governor of
E Delhi was neither arbitrary nor illegal. The inconsistency of the views
expressed in the impugned judgment and the larger Bench of Delhi High
Court is self evident. Dehli High Court has resolved the conflict of views
expressed by the Division Benches of co-equal strength by constituting a
larger Bench and the special leave filed against the judgment of the larger
Bench has already been dismissed.
F
Inconsistency and contradiction in the orders passed by the same Court
on the same point regarding the same scheme cannot be allowed to be
continued or perpetuated. If contention of the learned counsel is accepted
then an anomalous situation would arise by which the price fixed for few of
G the MIG flats in the scheme would be much less than the price fixed for the
remaining flats allotted in the same year which cannot be permitted. The law
laid down by the Supreme Court is binding on all courts within the territory
of India and the law laid down by a High Court is binding on all courts
within its jurisdiction. It is a cardinal principle of rule of law of that
inconsistency and contradiction in the orders has to be avoided at all costs to
H bring about a certainty in the mind of the Subordinate courts and the litignat
DELHI DEVELOPMENT AUTHORITY v. ASHOK KUMAR BEHAL [BHAN, J.] 631

public. This principal would stand violated in case two binding principles on A
the same point of the same Court are allowed to operate simultaneously.

We put an end to the controversy by setting aside the impugned judgment
and dispose of the writ petitions filed by the respondents in terms of the order
passed by the Full Bench of the Delhi High Court in Sheelaswanti and Ors.
decided on 3rd February, 1995. We agree with the view expressed by the B
larger Bench in Sheelawanti and Ors. Case (supra).

The appeals, accordingly, stand disposed of with no order as to costs.

K.K.T. Appeals disposed of.