Holding

No vested right can be claimed where statutory provisions and overriding public interest bar the allotment, and the doctrines of legitimate expectation and estoppel cannot be invoked against the State; consentees receive priority and price at the original allotment rate, while non‑consentees may seek alternative plots in the new zone at the prevailing price.

Summary

The case concerned the allotment of industrial plots in Chandigarh under the Capital of Punjab (Development and Regulation) Act, 1952 and the 1973 Lease‑Hold Rules. Of 339 shortlisted allottees, 254 could not be given possession because much of the land was declared a reserved forest and fell within a restricted zone under the Aircrafts Act. The Administration offered smaller alternative plots; some allottees consented (consentees) while others (non‑consentees) refused and litigated, invoking vested rights, legitimate expectation and promissory estoppel. The High Court directed possession to the consentees at the price prevailing on the draw date and rejected the non‑consentees’ claims. On appeal, the Supreme Court held that no vested right can arise where statutory provisions (Forest Act, Aircrafts Act) and public interest preclude the allotment, and that doctrines of legitimate expectation and estoppel cannot be pressed against the State in such circumstances. The Court affirmed priority to consentees, allowed non‑consentees to apply for alternative plots in a new industrial zone at the prevailing price, fixed the price for consentees at the original allotment rate, and limited relief to parties before the High Court. The appeals were disposed of with modified directions.

Issues considered

The existence of a vested right in the original industrial plots despite statutory restrictions.
Whether the doctrines of legitimate expectation and promissory estoppel are enforceable against the Administration.
Whether differential treatment of consentees and non‑consentees violates Article 14.
The appropriate price to be charged for alternative plots.
The entitlement of non‑consentees to alternative plots under the new industrial policy.

Legislation cited

Capital of Punjab (Development and Regulation) Act, 1952s. 3(3)
Chandigarh Lease Hold of Sites and Building Rules, 1973s. 10, s. 4, s. 6
Indian Forest Act, 1927

Subjects

vested rightlegitimate expectationpromissory estoppelArticle 14public interestforest reservationAircrafts Actindustrial plot allotmentadministrative lawprice adjustmentdifferential treatment

Judgment

HIRA TIKKOO A
v.
UNION TERRITORY, CHANDIGARH AND ORS.

APRIL 13, 2004

[SHIVARAJ V. PATIL AND D.M. DHARMADHIKARI, JJ.] B

Capital of Punjab (Development and Regulation) Act, 1952/Chandigarh
Lease Hold of Sites and Building Rules, 1973-Section 3(3) /Rules 4, 6 and
JO-Allotment of Industrial Plots-Full or Part payment by allottees-Major C
portion of the land under the Scheme was a reserved forest and restricted
under Aircrafts Act-Possession not given to many allottees-Due to paucity
of land decision of Administration to give the allottees alternate plots of
smaller sizes-Some al/ottees consented to it while the non-consentees went
into litigation-Draw of lots made to allot the land to consentees-Litigaiion
of non-consentees caused delay in getting possession by the consentees-Writ D
Petition by consentees seeking possession-High Court directed to give
possession to the consentees successful in the draw oflots at the rate prevailing
on the date of draw-Non-consentees not given the plots-Other consentees
directed to be accommodated in other Schemes-Plea of non-consentees that
they were entitled for possession of land as they had vested right in that and E
also on the basis of doctrine of Legitimate Expectation and Promissory
Estoppel-On appeal, held: Non-consentees not entitled to possession on the
basis of original allotment-Vested right cannot be claimed which would result
in violation of statutory provision or Constitution or against general public
interest-Overriding public interest outweighs the obligation of a promise or
representation of Administration-Consentees and Non-consentees by their F
action and inaction constitute two different classes and a differential treatment
cannot be held to be violative of Article 14 of the Comtitution-Order as
regards allotment to consentees is justified-However, the price of the land is
to be frxed at the rate.prevailing at the time of original allotment-The relief
is not applicable to those who were not parties before the Court as they would
be presumed to have abandoned their claims-Constitution of India, 1950- G
Article 14.

Doctrines:

Doctrines of 'Legitimate Expectation' and 'Promissory Estoppel' -
65 H
66 SUPREME COURT REPORTS [2004) SUPP. I S.C.R.

A Applicability of-Held: Where public interest is likely to be harmed, the
doctrines cannot be pressed into service by any citizen against State Authority.

Maxims: 'Salus populi est suprema lex' and 'Lex non cogit ad
impossibilia'

B Applications for allotment of industrial plots were invited by
respondent-Administration. Out of the applicants 339 were short listed for
·-
'

allotment in 1982. But 254 allottees could not be given possession of the
plots allotted to them, as the land was declared as reserved forest by
Notification issued in 1961. Though the Administration could not deliver
the possession but continued to accept the payment for the land. Pursuant
C to Writ Petition by allottees, Administration proposed to allot one kanal
land to each allottee irrespective of the size of plot originally allotted. In
1990, Administration framed a new Industrial Policy whereby it decided
to reduce the size of 4 kanals and 2 kanals of pfots by 25% so as to
accommodate and to enable itself to allot plots to all 254 allottees. In view
D of the new policy, earlier proposal to allot 1 kanal plot to each allottee
was withdrawn. Allottees of plots measuring 4 kanals and 2 kanals were
asked to give their consent for accepting reduced size of plots. The option
was not a~ked from the allottees of plots measuring 1 kanal. Some allottees
gave their consent. On 27.3.1991 draw of lots was held for allotting
alternative plots. The non-consentees filed Writ Petition challenging the
E Notification declaring the area as reserved forest, as also the Industrial
Policy of 1990 and the decision to reduce the size of the plots. The petition
was dismissed. Some non-consentees filed another Writ Petition
challenging the Industrial Policy of 1990 and others filed Letters Patent
Appeals. The petitions and appeals caused delay in allotment of alternative
F plots to consentees and hence they filed Writ Petition seeking direction
for allotment of alternative plots. High Court directed the Administration
to give possession of the alternative plots to the consentees. When despite
the order of High Court possession was not given, consentees filed another
Writ Petition for direction for delivery of possession. Administration,
therein expressed its inability to deliver possession on the ground that some
G part of the land to be allotted as alternative plot fell within restricted zone
under the Notification issued under the Aircrafts Act. High Court rejected
the plea of handing over possessiop of the plots to non-consentees, and
directed to issue allotment letters to the consentees
I
who were successful
in the draw held on 27.3.1991. The land was directed to be charged at the
H rate prevailing on the date of draw. High Court directed that those who
HIRA TIKKOO ''· UNION TERRITORY, CHANDIGARH 67

were successful in the draw but could not be allotted plots due to its paucity A
shall be allotted plots in any other Scheme.

The consentees, non-consentees and Administration filed appeal to
this Court. As the relief granted by High Court was restricted to the parties
before the Court, those who had not approached the Court, filed
impleadment applications in this Court. After the appeal, the mutual B
discussions and negotiations between the consentees, non-consentees,
interveners and Administration had failed. Thereafter Administration filed
affidavit inter alia stating that in accordance with the Industrial Policy of
1990 the allottees were asked to furnish certain information and were also
asked to furnish fresh project reports in accordance with the environment C
norms set in the policy. Some of the parties neither provided the
information nor submitted the projects. On the basis of information
/ t received in the course of the negotiations for settlement, 51 projects could
not be considered to be set up as per the prevalent pollution norms and
they could be considered only if they filed fresh projects. Out of 35
consentees, who had furnished the necessary information only 23 fulfilled D
the laid down criteria. Out of the category of allottees from whom consent
was not asked for, 13 had given complete information and fulfilled
requisite environmental norms; and that the land had been acquired in
other areas, wherein the left out allottees could be accommodated.

The non-consentees contended that the Notification under Aircraft E
Act having been expired, is no longer in operation; that the parties having
paid full price of the plots, Lease-deed having been executed in their
favour, they have been placed in formal possession and as such have
acquired a vested right to obtain the plots in view of Section 3(3) of Cai;ital
of Punjab [Development and Regulation) Act, 1952; that doctrines of p
'Promissory Estoppel' and 'Legitimate Expectation' are applicable to their
case; that in denying choice of alternative plots to them at par with
consentees, the order of High Court was discriminatory and violative of
right to equality under Article 14 of the Constitution.

The consentees contended that the order of High Court was not G
discriminatory as the alternative plots were limited in number in which,
both consentees and non-consentees could not be accommodated and their
refusal to accept alternative plots had caused long delay; that the non-
consentees having failed in the litigation, could not for the first time in
this Court could change their stand and compete with them; that the H
68 SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A direction of payment of price of plots at the rate prevailing on the date or"
draw of lots i.e. 27.3.1991 was not fair as they had paid full or part price
in 1982 and the said money was throughout with the Administra(ion.

Administration contended that though period of Notification under
Aircrafts Act had expired, but similar restriction was under contemplation
B and fresh Notification to that effect was likely to be issued and i(such
restrictions were imposed, the allottees falling in that area would have no
right to claim any compensation or damages; and that the price of the ·
plots charged at the rate prevailing on the date of draw of lots is not
correct, and the same should have been charged at current rate.
c Disposing of the appeals, the Court

HELD: 1. The Scheme and provisions of Capital of Punjab
(Development and Regulation) Act, 1952 and Chandigarh Lease Hold of
Sites and Building Rules, 1973 do not seem to contemplate creation of any
D vested right where any other State or Central legislation bars use of a
particular land for industrial development. The Chandigarh
Administration, in these cases, had prepared a Scheme, carved out plots,
auctioned them and received part or full p~yment of the price. In
implementing its development Scheme, it ignilred the Notification issued
reserving a major portion of the land covered by the Scheme as 'forest'.
E When a Scheme of development of land and the allotments made
thereunder are found to be in contravention of any law and contrary to
general public interest, no claim based on so called vested right can be
countenanced. Similar is the position with regard to restriction imposed
under the Aircrafts Act. No citizen can be allowed to claim any vested
F right which would result in violation of a statutory provision of law or
Constitution. The claim, therefore, based on alleged vested right, has to
be outright rejected. [78-G-H; 79-A-C)

2.1. The Administration herein no doubt is guilty of gross mistake
in including in its development scheme, a portion of land covered by the
G forest and land with restrictions under the Aircrafts Act, but overriding
public interest outweighs the obligation of a promise or representation
made on behalf of the Administration. Where public interest is likely to
be harmed, neither the doctrine of legitimate expectation·' nor 'estoppel'
can be allowed to be pressed into service by any citizen against the State
Authorities. Legal Maxim: 'Salus populi est suprema lex: 'regard for the
H public welfare is the highest law' can be called in aid. This principle is
HIRA TIKKOO v. UNION TERRITORY, CHANDIGARH 69
based on the implied agreement of every member of society that his own A
individual welfare shall in cases of necessity yield to that of community.
His property, liberty and life shall under certain circumstances be placed
in jeopardy or even sacrificed for the public good. 180-G-H; 81-A-BI

Mis. Jit Ram Shiv Kumar and Ors. v. State of Haryana and Ors., [19811
1 SCC 11; Union of India v. Indo Afgan Agencies Ltd., [19681 2 SCR 366 B
a~d Motilal Padampat Sugar Mills Co. (P) Ltd. v. State of U.P., [19791 2 SCC
409, relied on.

M Ramanatha Pillai v. The State of Kera/a and Anr., [19731 2 SCC
650 and State of Kera/a and Anr. v. The Gwalior Rayon Silk Manufacturing
(WVG.) Co. Ltd. Etc., [1973) 2 SCC 713, referred to.
ci
'Judicial Review ofAdministration Action' 5th Edition at page 565 para
13-028, referred to.

2.2 On the same principle and to protect larger public interest, the
Chandigarh Administration can be relieved of fulfilling legitimate DI
expectation arising from its allotment of plots on the ground that their
development Scheme under consideration have been found to be in
contravention of Forest Act and Aircrafts Act. Another legal maxim which
can be invoked to their aid is : 'Lex non cogit ad impossibilia : the law does
not compel a man to.do that which he cannot possibly perform'. [81-B-q . E

3.1. The 'rules of fairness' by which every public Authority is bound,
requires them to compensate loss occasioned to private parties or citizens
who were misled in acting on such mistaken or negligent advice of the
public Authority. There are no allegations and material in these ..·ases to
come to a conclusion that the action· of the Authorities was ma/a fide. It F
may be held to be careless or negligent. The public Authorities cannot be
absolved of their liability to provide adequate monetary compensation to.
the parties who are adversely affected by their erroneous decisions and
actions. But in these cases, any directions to the public authorities to pay
monetary compensation or damages would also indirectly harm general G
public interest. The public authorities are entrusted with public fund raised
from public money. The funds are in trust with them for utilization in
public interest and strictly for the purposes of the Statute under which
they are created with specific statutory duties imposed on them. In such
a situation when a party or citizen has relied, to his detriment, on an
erroneous representation made by public authorities and suffered loss and H
70 SUPREME COURT REPORTS [2004) SUPP. I S.C.R.

A where doctrine of 'estoppel' will not be invoked to his aid, directing
administrative redressal would be a more appropriate remedy than
payment of m?netary compensation for the loss caused by non-delivery
of the possession of the plots and consequent delay caused in setting up
industries by the allottess. f82-B-FI

B Administrative Law by H. W.R. Wade and C.F. Forsyth, Eight Edition at
pages 370-373; Judicial Review of Administration Action by De Smith Woolf
and JoweU, 5th Edition at page 565 para 13-028, referred to.

3.2. Administration has adopted a fair attitude. It has come out with
C a proposal to give alternative plots of smaller sizes because of the paucity
of land available in development schemes in Phase-I and II. The statutory
compulsion and the rule of fairness have both to be evenly balanced. This ·
Court cannot allow the Administration to commit breach of law and harm
public interest. At the same time, it cannot be absolved of its liability to
give appropriate redressal and compensation to the parties and citizens
D who have suffered loss because of their grossly mistaken decision and
actions. The allottees of the plots, when they were given option .to accept
alternative plots of smaller sizes, ought to have accepted the offer being
the appropriate compensation to them in thP. circumstances obtaining.
[82-G-H; 83-A-B]

E 4. Rule of reasonableness and fairness by which every statutory
Authority is bound, demands that the consentees, who, for no fault on their
part, were deprived of the original plots of larger sizes, should not be
further made to suffer by demanding from them higher price for the
alternative plots 9f smaller sizes. It would be highly iniquitous to demand
F from them higher price for smaller sizes of plots and add to their losses
caused by undue delay in setting up their industries. The Administration
is mainly to be blamed for the situation in which the allottees of plots find
themselves today. In such circumstances, the Administration must bear a
portion of loss, if any, occasioned to it and compensate to some extent the
loss caused to the consentees who never objected to allotment of alternative
G plots of smaller sizes. [85-A-D]

5.1. The non-consentees cannot claim parity for allotment with the
consentees. The consentees have to be considered in priority as, at the first
available opportunity, they agreed to the offer of alternative plots of
smaller sizes. The non-consentees not only questioned the offer made by
H the Administration to provide them plots of smaller sizes but even assailed
HIRA TIKKOO v. UNION TERRITORY, CHANDIGARH 71
the Government Notification declaring major part of the land in the A
Scheme as reserved forest They might have a legitimate right to approach
the courts for necessary reliefs but having failed in their challenges in the
Court, they can claim no right of being treated similarly with consentees.
The consentees and the non-consentees, on the basis of their actions and
inactions, constitute two different classes of allottees and a differential B
treatment to them cannot be held to be unjustified or in violation of Article
14 of the Constitution. On a just and reasonable ground, the consentees
deserve a mere favourable treatment than non-consPntees more so because
plots of small sizes available in the existing scheme in Phase-I and II are
extremely limited in number. [85-F-Hl
c
5.2. The only relief that can be granted to the non-consentees would
be to permit them to submit their willingness within a period of one month
from the date of the order in writing to the Administration to be
considered for allotment of a suitable plot in the new industrial zone but
at the price prevailing on the date of such fresh allotment. [88-H; 89-A) D
6. The group of individuals and parties, who were not parties before
the High Court cannot be allowed to join race for allotment of available
alternative plots. It will have to be presumed that having not ventilated
their grievances and enforced their rights, if any, at any earlier stage, they
have abandoned their claims. Merely because during pendency of court E
proceedings, some rounds of negotiations and discussions took place in
which the Administration also invited them, would not furnish them a
cause of action to raise their claims which they had earlier given up by
their inaction and lapse. [89-C-E)

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4725 of p
2002.

From the Judgment and Order dated 30.8.200 lof the Punjab and Haryana
High Court in C.W.P. No. 717 of 1997.
WITH G
C.A.Nos. 4732-47, 4748-49, 4728, 4729, 4750-51, 4730-31, 5319, 7206,
4752-4807, 4726-27, 4808-4809/2002, 7109/2003 and SLP(C) Nos. 5115-17
of 2002.

M.L. Venna, Rakesh Dwivedi, M.N. Krishnamani, Sudhir Nandrajog, H
Nikhil Nayyar, Manoj Swamp, Ms. Nidhi Aggarwal, M.K. Dua, Arvind
72 SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A Minocha, Ms. Kamini Jaiswal, Ms. lnklee Barooh, _Ms. Shomila Bakshi, Anil
Khetrapal, S.K.Mishra for Debasis Misra, B.V. Balaram Das, P. Panneswaran,
M.G. Kapoor, Bharat Sangal, S.M.Sarin, P.N. Puri, R.K. Kapoor for Anish
Ahmed Khan, Jagjit Singh Chhabra, Ramesh Goyal, Ramesh Babu M.R., Ms.
Pinky Anand, D.N. Goburdhan, Ms. Geeta Luthra, .Rajesh Ranjan, ·Naresh
B Kaushik, Ms.Lalitha .Kaushik, Ms. Shilpa Chohan and Jatin Zaberi for the
appearing parties.

The Judgment of the Court was delivered by

DHARMADHIKARI, J. These appeals and special leave petitions are
preferred against the common judgement dated 30.8.2001 passed by the
C Division Bench of High Court of Punjab & Haryana whereby a batch of writ
petitions preferred by the applicants for allotment of industrial plots in the
development scheme framed by the Union Territory, Chandigarh [shortly
referred to as UTC] has been disposed of with certain directions. Different
classes of allottees of industrial plots and UTC all feel aggrieved by the
D judgment of the High Court and are before this Court.

The full factual background leading to the dispute inter se between the
applicants for industrial plots and UTC is required to be set out :-

With a view to re-enact and modify the law in relation to the development
E and r~gulation of the new capital of Punjab at Chandigarh, Legislation by
name Capital of Punjab [Development and Regulation] Act, 1952 [shortly
referred to as the Act] was passed in the year 1952 vesting. the State
Government with legal authority to regulate the. sale of building sites. In
exercise of powers under the Act, rules for allotment of sites for building
have been framed known as the Chandigarh Lease Hold ofSites and Euilding
F Rules, 1973 [hereinafter referred to as the Rules], which among others provide
that the Administration ofUTC, may demise sites for industries and buildings
by allotment or auction.

In accordance with t!te provisions of the Act and Rules mentioned
above, the Administration of UTC issued an advertisement No. 1/81 on
G 14.4.1981 inviting applications from interested entrepreneurs seeking allotment
of the industrial plots of different sizes ranging from 10 mar las to 4 kanals.
Pursuant to the said advertisement, 3735 applications were received from
different parties. The Screening Committee of the Administration of UTC on
16. 7.1982 short-listed 339 parties for allotment of industrial plots of different
H sizes after studying their project reports and conducting interviews. The 339
successful applicants, selected for allotment of plots of different sizes, were
HIRA TIKKOO v. UNION TERRITORY, CHANDIGARH [DHARMADHIKARI, J.] 73

directed to deposit 25% of the total cost of the plots. On 30. l l.l 982, for A
allotting specific plots, a draw of lots was held among 339 successful allottees.
As a result of the draw of lots, 57 parties were given possession of their plots
in developed industrial areas i.e. Phase-I and Phase-II. Twenty one parties
took refund of their money. Seven allottees were given option for change of
their plots. Remaining 254 allottees could not be given possession of the .$
plots, allotted to them, as there were objections from the State Authorities to
the industrial development of the land it being covered by the notification,
issued in the year 1961, declaring area of the lar.J as reserved forest. The
Administration of UTC could not deliver the possession of that land which
was covered in the reserved forest, to 254 allottees of the year 1989 but it
continued to accept the yearly installments fixed for payment from the selected C
allottees.

Certain allottees filed writ petitions in the year 1987 in the High Court
seeking directions to the Administration of UTC to deliver possession of the
industrial plots allotted to them in accordance with the short-listing done by D
the Screening Committee and consequent draw of lots.

On 29.11.1990, the Director of Industries, Government of India,
intimated to the allottees that the Administration of UTC was not in a position
to deliver possession of the industrial plots allotted to them as the land was
found to be a part of reserved forest. The Administration proposed to allot E
one kanal land to each allottee irrespective of the size of plot originally
allotted.

On 10.12.1990, the Administration ofUTC then framed a new industrial
policy to accommodate 250 allottees of 1982 who could not be· given
possession of the industrial plots because of the land being reserved for F
forest To meet aforesaid difficult situation, the Administration decided to
reduce the size of 4 k~al and 2 kanal of industrial plots by 25% so as to
accommodate and to enable itself to allot plots to all 254 allottees. In view
of the new industrial policy of 1990, the earlier letter dated 29.11.1990
proposing each allottee one kanal of plot was withdrawn. On 05.2.1991, a G
letter was issued to allottees of plots measuring 4 kanal and 2 kanal to give
their consent for accepting reduced size of plot by 25% of the original plot
allotted to each of them. The option was invited within a period of 30 days.
No option was asked from the allottees of plots measuring one kanal and 10
marlas.
H
74 SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A Some allottees had given their consent who shall be hereinafter referred
to shortly as 'the consentees'.

Many others who did not give their consent for reduced size of plots
challenged the action of the Administration of UTC in the High Court.
The new declared· industrial policy of 1990 was also challenged. Such
B allottees who did not give consent for smaller sizes of plots and approached
the High Court shall be, hereinafter, referred to as 'the non-consentees'.
These non-consentees in the petitions filed by them in the High Court
obtained stay against the draw of lots scheduled to be held on 27 .3 .1991
for allotment of specific plots of smaller sizes to the consentees. The non-
C consentees made a three-pronged attack in the writ petitions by challenging
the notifi«ation of declaring the area as reserved forest, the new ir.dustrial
policy of 1990 and the decision to reduce the size of plots taken by the
Administration of UTC. A single Judge of the High Court by order dated
15.11.1991 dismissed the writ petitions filed by the non-consentees. But
D as the Administration of UTC was found to be blameworthy for the situation
created, the learned single Judge merely expressed a wish that they would
be accommodated in the alternative schemes. After decision of the case
by the single Judge of the High Court, the Administration of UTC on
07 .2.1992 issued a letter asking all the 254 allottees to furnish an affidavit
in prescribed form indicat_ing that none of them possessed any industrial
E plot in the territory of Chandigarh, Panchkula or Mohali in his/her name
or in the name of his/her spouses/children. This affidavit was demanded
in terms of the new industrial policy of 1990. Out of 254 allottees only
161 consentees ·gave their affidavits. Some of the non-consentees again
approached the High Court challenging the new industrial policy of 1990
p by filing fresh petitions and others filed letters patent appeals. In their
petitions and appeals, they insisted on grant of relief of directing delivery
of possession of the original plots allotted to them. The filing of this
petition and appeals resulted in stalling the allotments of alternative plots
pursuant to the new industrial policy of 1990 even to consentees who had
agreed for plots of reduced sizes at alternative locations and had filed
G affidavits in the requisite form. The consentees approached the High Court
with a prayer that the Administration be directed to give them possession
of the alternative plots of smaller sizes. The Division Bench of the High
Court passed an order dated 22.11.1994 and by modifying its earlier order
dated 13 .1.1992 clarified that the Administration of UTC can proceed to
H allot the industrial plots to consentees subject to the condition that the
HIRA TIKKOO "·UNION TERRITORY, CHANDIGARH [DHARMADHIKARI, J.] 75

plots of the size allotted to the non-consentees, who are in litigation, shall A
be kept reserved and not reduced. Despite the above modification and
clarification made by the High Court, the Administration of UTC did not
deliver possession of the plots even to consentees stating that in some
other cases, stay orders against the allotments were operating against the
Administration. On 12.8.1995, the High Court again modified its earlier B
orders and gave liberty to the Administration to give possession of alternative
plots to consentees. Despite the above order, the Administration of UTC
did not choose to deliver possession of the alternative plots even to consentees
as in their view, the interim orders of the High Court restrained them
from reducing the size of plots allotted to non-consentees.
c
The consentees then approached by substantive petitions before the
High Court seeking relief in their favour of issuing direction to the
Administration of UTC to deliver possession of alternative plots to them.
In response to the writ petitions filed by consentees, the Administration
expressed its inability to deliver possession of the plots even to consentees.
It was stated that some part of the land to be allotted as alternative plots D
falls within the restricted zone under the notification issued under the
Aircrafts Act for Air-Force base.

The Division Bench of the High Court, after long drawn hearing and
detailed consideration of the competing claims of consentees and non- E
consentees as also the stand of the Administration, passed a common ·
judgement with the directions which are subject matter of these appeals
preferred by non-consentees who are aggrieved by denial to them of alternative
plots. Consentees feel aggrieved by direction permitting from them demand
of the price at the rate prevailing on the date of draw of lots i.e. 27 .3.1991.
According to the Chandigarh Administration, during. long pendency of F
litigation, a new industrial policy of 2001 has been promulgated in which
one phase of industrial area is to be reserved for setting up the Information
Technology industries. The Administration is aggrieved by the directions
permitting them to charge price only at the rate prevailing on the date of
draw of lots i.e. 27 .3 .1991 and not at current rate. G
Amongst the consentees and non-consentees, there are individuals
and parties who did not file any writ petitions in the High Court and as
the relief granted is restricted to the parties before the court, such parties
and individuals have filed applications seeking intervention and/or
impleadment as parties in this group of appeals. H
76 SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A The directions giv~n by the High Court in the impugned judgment
are as under :-

I. The prayer of the appellants/petitioners for directing the authorities
of Chandigarh Administration to hand over possession of the
plots allotted on the basis of draw held in November, 1982 is
B rejected.
2. However, the authorities of Chandigarh Administration are
directed to issue allotment letters to those appellants/petitioners
who had given consent for allotment of alternative plots of smaller
sizes and who were successful in the draw held on 27.3.1991.
c They should be charged price at the rate prevailing on the date
of draw.
3. Those who were declared successful in the draw held on 27.3 .1991
but cannot be allotted plots due to non-availability ·of sufficient
land in the wake of prohibition imposed vide notification dated
D 5.1.1988 shall be allotted plots in any other scheme already framed
-.-
or which may be framed hereafter by Chandigarh Administration.
4. Those who were. declared successful in the draw held in 1982,
but did not give consent for allotment of.alternative plots shall
be refunded the amount deposited by ~hem with interest at the
E rate of 12% from the date of deposit till the date of actual payment.
5. Within one month from the date of receipt of this order,
Chandigarh Administration shall get published in the Tribune
the list of the applicants who had given consent for allotment of
alternative plots and were declared successful in the draw held
F on 27.3.1991 sp~cifying the number of plots earmarked for them.
6. Notification dated 28.4.2000 is held inapplicable and inoperative
qua the allotments made to the appellants/petitioners on the basis
of the draw held on 27.3 .199 l.

G ................... .
In this Court when the arguments commenced, it was felt by all parties
involved as also by this Court that some amicable solution reasonably
acceptable to all the parties can be found out on the basis of mutual discussions
and negotiations between the authorities of the Chandigarh Administration,
H the contesting consentees and non-consentees.
HIRA TIKKOO 1·. UNION TERRITORY, CHANDIGARH [DHARMADHIKARI, J.] 77
Despite giving them repeated opportunities to settle the matter through A
negotiations, we are unhappy to record that the counsel for the parties reported
that efforts to amicably solve the issue have failed. ·

Learned senior counsel Shri M.L. Verma appearing for the non-
consentees very fairly stated that the notification reserving certain lands for
the forest and the restrictions imposed on construction in periphery of 900 B
metres from the Air-Force base under the Aircrafts Act cannot be questioned
and that part of the judgment of the High Court is not being assailed in these
appeals. With regard to the restrictions under Aircrafts Act, it is however,
pointed out that the period of restriction under notification dated 22.5.2001
has expired and therefore, the said restriction of 900 metres under the Aircrafts C
Act is no longer in operation.

Learned counsel appearing for the Administration ofUTC had pointed
out to us that the contents of the letter dated 20.11.2003 received by the
Administration from Ministry of Defence, Government of India do show
that the period of notification imposing restriction has expired but it has D
been intimated in the same letter that the similar restriction is under
contemplation and a fresh notification imposing same is likely to be issued
in future. In the aforesaid circumstances, learned counsel for the Chandigarh
Administration submitted that allotment of alternative plots within 900 ·
metres would be subject to any imposition of restriction under the Aircrafts
Act and if such restrictions are imposed, the allottees of plots falling in E
that area would have no right to claim any compensation or damage from
the Administration.

We shall take up first for consideration the grievances raised and
the challenges made to ~he directions of the High Court by the learned F
counsel appearing on behalf of the non-consentees. On their behalf, learned
counsel states that amongst them are large number of allottees who, on
having been only given letter of allotment, have paid full price of the
plots. Lease-deeds have been executed in their favour and they have been
placed in formal possession of the plots although they have not been
allowed to take physical possession and raise super-structures. Such allottees, G
it is contended, have acquired a vested right to obtain the plots. Reliance
is placed on section 3(3) of the Act read with rules 4, 6 & 10 of the Rules
which read as under :-

"Section 3. Power of Central Government in respect of transfer of
land and building in Chandigarh. G
78 SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A (I) ............. .

(2) .................. .

(3) Notwithstanding anything contained in any other law for the time
being in force, until the entire consideration money together with
interest or any other amount, if any, due to the Central Government
B
on account of the transfer of any site or building, or both, under sub-
section (12) is paid, such site or building, or both, as the case may
be, shall continue to belong to the Central Government. ·

Rule 4. The Chandigarh Admini.stration may demise sites and buildings
C at Chandigarh on lease for 99 years. Such leases may be given by
allotment or by auction in accordance with· these rules.

Rule 6. Commencement and period of lease. - The lease shall
commence from the date of allotment or auction, as the case may be,
and shall be for a period of 99 years. After the expiry of the said
D period of 99 years, the lease may be renewed for such further period
and on such terms and conditions as the Government may decide.

Rule 10. Delivery of possession. - Actual possession of the site/
building shall be delivered to the lessee on payment of 25 per cent
of the premium in accordance with rule 8 or rule 9 as the case may
E be.

Provided that no ground rent payable under rule 13 arid interest on
the instalments of premium payable under sub-rule (2) of rule 12
shall be paid by the lessee till the actual and physical possession of
the site/building is delivered or offered to be delivered to him,
F whichever is earlier.

Some decisions, which need not detain us for consideration, were cited
to contend that on_ execution of lease-deads, payment of price and formal
delivery of possession of the plots, a vested right in law in the plots allotted
has been created in favour of the allottees regardless of their consent or non-
G consent for alternative plots.

We have examined the scheme and provisions of the Act and the Rules.
They do not seem to contemplate creation of any vested right where any.
other state or central legislation bars use of a particular land for industrial
development. The Chandigarh Administration, in these cases, had prepared a
H
HIRA TIKKOO v. UNION TERRITORY, CHANDIGARH [DHARMADHIKARI, J.] 79
scheme, carved out plots, auctioned them and received part or full payment A
of the price. In implementing its development scheme, it i!Jnored the
notification issued reserving a major portion of the land covered by the
scheme as 'forest'. It is in this circumstance that the Administration is showing
its inability to honour the commitment made by offering the plots, acceptance
of price and giving delivery of possession. When a scheme of development B
of land and the allotments made thereunder are found to be in contravention
of any law and contrary to general public interest, no claim based on so
called vested right can be countenanced. Similar is the position with regard
to 900 metres restriction imposed under the Aircrafts Act. No citizen can be
allowed to claim any vested right which would result in violation of a statutory
provision of law or Constitution. The claim, therefore, based on alleged vested C
right, has to be outright rejected.

The learned senior counsel then made some attempts to rely on the
doctrines of 'promissory estoppef and 'legitimate expectation'. Doctrine of
'legitimate expectation' has developed as a principle of reasonableness and
fairness and is used against statutory bodies and government authorities on D
whose representations or promises, parties or citizens act and some detrimental
consequences ensue because of refusal of authorities to fulfil their promises
or honour their commitments. The argument under the label of 'estoppel' and
'legitimate expectation' are substantially the same. The Administration herein
no doubt is guilty of gross mistake in including in its development scheme, E
a portion of land covered by the. forest and land with restrictions under the
Aircrafts Act. A vital mistake has been committed by the Chandigarh
Administration in overlooking the notification reserving land under the Forest
Act and the restrictions imposed under the Aircrafts Act, but overriding public
interest outweighs the obligation of a promise or representation made on
behalf of the Administration. Where public interest is likely to be harmed, F
neither the doctrine of 'legitimate expectation' nor 'estoppel' can be allowed
to be pressed into service by any citizen against the State Authorities. In Ms.
Jit Ram Shiv Kumar and Ors. v. State of Haryana and Ors., [1981] 1 SCC
11, a two-Judge Bench of this Court by explaining and distinguishing Union
ofIndia v. Indo-Afgan Agencies Ltd, [ 1968] 2 SCR 366 and Motilal Padampat G
Sugar Mills Co. (P) Ltd. v. State of U.P., [1979] 2 SCC 409, observed thus:-

'It is only in public interest that it is recognized that an authority
acting ~m behalf of the government or by virtue of statutory powers
cannot exceed his authority. Rule of ultra vires will become applicable
when he exceeds his authority and the government would not be H
80 SUPREME COURT REPORTS (2004] SUPP. I S.C.R.

A bound by such action. Any person who enters into an arrangement
with the government has to• ascertain and satisfy himself that the
authority who purports to act for the government, acts within the
scope of his authority and cannot urge that the government is in the
position of any other litigant liable to be charged with liability'.

B In the aforesaid case of Mis. Jit Ram Shiv Kumar (supra) , the Municipal
Committee ofBahadurgarh town to develop a Mandi promised that the traders
who purchase plots in Mandi would be exempted from paying octroi duty on
goods imported for trade to the Mandi. The State Government in exercise of
powers under the Punjab Municipal Act directed the Municipal Committee to
C withdraw the exemption from payment of octroi duty. When the traders, who
had set up their business in the Mandi on promise of getting exemption from
octroi duty, challenged the action of the Municipality and the Punjab
Government and raised on plea of 'estoppel' it was rejected by this Court by
relying on the decision of Constitution Bench of this Court in the case of M
Ramanatha Pillai v. The State of Kera/a and Anr., [1973] 2 SCC 650 and.
D State of Kera/a and Anr. v. The Gwalior Rayon Silk Manufacturing (WVG.)
Co. Ltd. Etc., [1973] 2 SCC 713. This Court in Mis Jit Ram Shiv Kumar
(Supra) , recorded the following conclusion which supports the view we
propose to take in the circumstances of the present case :-

'On a consideration of the decisions of this Court, it is clear that there
E can be no 'promissory estoppel' against the exercise of legislative
power of the State. So also the doctrine cannot be invoked for
preventing the government from acting in discharge of its duty under
the law. The government would not be bound by the act of its officers
and agents who act beyond the scope of their authority and a person
dealing with the agent of the government must be held to have notice
F
of the limitations of his authority. The court can enforce compliance
by a public authori~ of the obligation laid on him if he arbitrarily or
on his mere whim ignores the promises made by him on behalf of the
government. It would be open to the authority to plead and prove that
there were special considerations which necessitated his not being
G able to comply with his obligations in public interest'.

In public law in certain situations, relief to the parties aggrieved by
action or promises of ·public authorities can be granted on the doctrine of
'legitimate expectation' but when grant of such relief is likely to harm larger
public interest, the doctrine cannot be allowed to be pressed into service. We
H
HIRA TIKKOO ''·UNION TERRITORY, CHANDIGARH [DHARMADHIKARI, J.] 8J

may usefully call in aid Legal Maxim : 'Salus populi est suprema lex .· A
regard for the public welfare is the highest law. This principle is based on
the implied agreement of every member of society that his own individual
welfare shall in cases of necessity yield to that of community. His property,
liberty and life shall under certain circumstances be placed in jeopardy or
even sacrificed for the public good'.
B
On the same principle and to protect larger public interest, the
Chandigarh Administration can be relieved of fulfilling legitimate expectation
arising from its allotment of plots on the ground that their development
schemes under consideration have been found to be in contravention of Forest
Act and Aircrafts Act. Another legal maxim which can be invoked to their C
aid is : 'Lex non cogit ad impossibilia : the law does not compel a man to
do that which he cannot possibly perform'.
>
The allottees of the plots are, no doubt, faced with an uncertain situation
with loss already caused to them due to negligence and mistake on the part
of the Planning Authorities of the Chandigarh Administration. In preparing D
, the development scheme, the existing notification reserving major part of
land as forest under the Indian Forest Act and restriction on construction in
periphery of900 metres from the Air-force base under the Aircrafts Act were
overlooked. As we have held above, on a representation that the land is
available for allotment of industrial plots, the allottees staked their money
and plans for setting up their industries. The representations made to them by E
the Planning Authorities have turned out to be misleading as a substantial
part of the land could not have been included in the development scheme.
The allottees paid price for the plots and incurred expenses in preparing their
industrial projects. We have held above that the doctrine of 'legitimate
expectation' and 'estoppel' cannot be applied against the Administration to F
compel it to allot the original plots because that would be permitting violation
of Statutes intended to conserve forest and restrictions imposed in the interests
of general public and security of Nation under Aircrafts Act. Doctrine of
'estoppel' cannot, therefore, be allowed to be urged against the Administration.
This Court cannot direct the Administration to commit breach of statutory
provisions and thus harm general public interests. De Smith, Woolf and G.
Jowell in their authoritative book on 'Judicial Review ofAdministration Action'
(5th Edition at page 565 para 13-028], have stated one of the principles of
public law powers thus : 'A public body with limited powers cannot bind
itself to act outside of its authorised powers; and if it purports to do so it can
repudiate its undertaking for it cannot extend its powers by creating an H
82 SUPREME COURT REPORTS (2004) SUPP. I S.C.R,.

A estoppel'.
Surely, the doctrine of estoppel cannot be applied against public
authorities wheri'their mistaken advice or representation is found to be in
breach of a Statute and therefore, against general public interest. The ~
question, however, is whether the parties or individuals, who had suffered
B because of the mistake and negligence on the part of the statutory public
authorities, would have any remedy of redressal for the loss they have
suffered. The 'rules Of fairness' by which every public authority is bound,
requires them to compensate loss occasioned to private parties or citizens
who were misled in acting on such mistaken or negligent advice of the
public Authority. There are no allegations and material in these cases to
c come to a conclusion that the action of the authorities was ma/a fide. It
may be held to be careless or negligent. In some of the English cases, the
view taken is that the public authorities cannot be absolved of their liability
to provide adequate monetary compensation to the parties who are adversely
affected by their erroneous decisions and actions. But in these cases, any
D directions to the public authorities to pay monetary compensation or damages
would also indirectly harm general public interest. The public authorities
are entrusted with public fund raised from public money. The funds are
in trust with them for utilisation in public interest and strictly for the
purposes of the Statute under which they are created with specific statutory
duties imposed on them. In such a situation when a party or citizen h~s
E relied, to his detriment, on an erroneous representation made by public
authorities and suffered loss and where doctrine of 'estoppel' will not be
invoked to his aid, directing administrative redressal would be a more
appropriate remedy than payment of monetary compensation for the loss
caused by non-~elivery of the possession of the plots and consequent
F delay caused in setting up industries by the allottees.

[See the Administrative Law by H.W.R. Wade & C.F. Forsyth, Eight
Edition at pages 370-373. Also the book on 'Judicial Review of
Administration Action' by De Smith, Woolf and Jowell, 5th Edition
at page 565 para 13-028].
G
In the predicament aforesaid, the Administration has adopted a fair
attitude. It has come out with a proposal to give alternative plots but of
smaller sizes because of the paucity ofland available in development schemes
in Phase-I and II.The statutory compulsion and the rule of fairness have both c
to be evenly balanced. This Court cannot allow the Administration to commit
H
HIRA TIKKOO '"UNION TERRITORY, CHANDIGARH [DHARMADHIKARI, J.] 83
· breach of law and hann public interest. At the same time, it cannot be absolved A
of its liability to give appropriate redressal and compensation to the parties
and citizens who have suffered loss because of their grossly mistaken decisions
and actions. The allottees of the plots, when they were given option to accept
alternative plots of smaller sizes, ought to have accepted the offer being the
""" appropriate compensation to them in the circumstances obtaining. The allottees
who have consented to accept alternative plots even of smaller sizes and B
others who did not consent, maybe, because they were in litigation and required
plots of bigger sizes, constitute two different groups requiring different
treatment in the matter of directing grant of appropriate redressal to them by
the Administration.

The learned counsel on behalf of non-consentees submitted that in
c
denying choice of alternative plots to non-consentees at par with consentees,
the High Court unreasonably discriminated the non-consentees. It is submitted
·~
that the non-consentees were legitimately fighting for their rights for the
original plots allotted of required sizes and which suited to their industrial
projects. Merely because in the course of court proceedings, draw of lots for D
alternative plots were stayed and held up, is no ground to deny non-consentees
the allotment of alternative plots, when in many of their cases, full prices
have been paid, lease-deeds executed and even formal possessions have been
obtained although they could not set up industries. It is submitted that the
rule of fairness requires consentees lll_ld non-consentees be treated at par for
allotment of alternative plots. No prejudicial treatment could be meted out to
E
non-consentees by completely depriving them of alternative plots and merely
directing refund of their prices. In this respect, it is urged that pendency of
court proceedings should harm no one and mere approach to the law courts
for enforcement of their legal and constitutional rights should not be taken
as a circumstance against the parties. The contention advanced is that F
discrimination between consentees and non-consentees is violative of right of
equality guaranteed under Article 14 of the Constitution.

We have also heard the learned senior counsel Shri M. N. Krishnamani
appearing for the consentees, who has very stiffly opposed the claim for
alternative plots advanced on behalf of the non-consentees. The plots of G
small sizes are limited in number in which both consentees and non-consentees
cannot be accommodated. Learned counsel submits that differential treatment

'• .. given to consentees and non-consentees by the High Court is fully justified
for various reasons. It is submitted that the writ petitions filed by the non-
consentees challenging the notification of reservation of land for forest and H
84 SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A their refusal to accept alternative plots of smaller sizes, occasioned long
delay in making available the alternative plots to all. The consentees had to
intervene and fight independently in the High Court as also in this Court to
obtain possession of the plots which they could have obtained on the basis
of their consent and draw of lots on 27.3.1991. It is submitted that non-
B consentees were mainly responsible for stalling actions of the Administration
and attempts by them to accommodate as much number of allottees in the
alternative plots as was possible on the basis of availability of developed land
and the size of plots. They submitted that the non-consentees having entered
into a long drawn litigation against the Administration and failed, they cannot
now, for the first time in this Court, be allowed to change their stand and
C compete with consentees in draw of lots for smaller sizes of available alternate
plots. The High Court, therefore, was right in completely excluding the non-
consentees from being considered for grant of alternative plots. The other
grievances raised on behalf of the consentees is with regard to direction no.
2 in the judgment of the High Court by which the consentees have been
directed to be allotted alternative plots under draw of lots held on 27.3.1991
D but on the price prevailing on the date of the draw of lots. This part of the
direction no. 2 of the High Court is questioned on behalf of the consentees
by stating that they had paid full or part price for, the original plots as allotted
to them in the year 1982 and the said money was throughout with the
Administration. Now directing the consentees to pay the price for the alternative
E plots on the price prevailing on the date of draw i.e. 27.3.1991 is primafacie
unfair and highly burdensome because .the consentees for no fault on their
part are made to pay much higher price. The Administration despite their
vital mistake in preparing schemes for the land partly covered by reserved
forest should not be allowed enrichment by allowing them to charge higher
price for smaller sizes of plots in the same scheme or the alternative schemes.
F
We have heard learned senior counsel Shri Rakesh Dwivedi assisted by
Ms. Kamini Jaiswal appearing for the Administration on the question of
charging of price for alternative plots of smaller sizes in the same scheme or
the other schemes. The justification advanced for demanding higher price is
G that in the course of long drawn litigation, additional expenditure was required
to be incurred for rep lotting and prices of land have gone up in the meantime.
It is also submitted that it may not be possible to accommodate all consentees
even for smaller sizes of plots in the same scheme. Some of them will have
to be accominodated in other schemes. The acquisition cost of land in other
schemes is higher. The direction of the High Court to charge from the
H consentees for alternative plots, price as was prevailing on the date of draw
HIRA TIKKOOv. UNION TERRITORY, CHANDIGARH [DHARMADHIKARl,J.] 85
of lots held on 27.3.1991 is, therefore, described as highly unreasonable. A
After considering the rival submissions made on behalf of various parties,
we are of the view that the rule of reasonableness and fairness by which
every statutory authority is bound, demands that the consentees, who, for no
fault on their part, were deprived of the original plots of larger sizes, should
not be further made to suffer by demanding from them higher price for the B
alternative plots of smaller sizes. It would be highly iniquitous to demand
from them higher price for smaller sizes of plots and add to their losses
caused by undue delay in setting up their industries. The Administration is
mainly to be blamed for the situation in which the allottees of plots find
themselves today. In preparing scheme and allotting plots, it could not have C
ignored the notification reserving a part of land for the forest and the restriction
to the extent of 900 metres around the Air-Force base. The allottees of the
plots have paid full or part price and that amount throughout remained with
the Administration. In such circumstances, the Administration must bear a
portion of loss, if any, occasioned to it and compensate to some extent the
loss caused to the consentees who never objected to allotment of alternative D
plots of smaller sizes. The direction no. 2 of the High Court, therefore, to the
extent of charging price from the consentees as prevailing on the date of
draw of lots i.e. 27.3.1991, deserves to be set aside and substituted with the
directions that the consentees on being allotted a particular plot of smaller
size shall be charged the same price which was prevailing at the time of E
original allotment of the plot in their favour. Necessary adjustment or refund
of price, as the case may be, shall be given to them for the small size of plot
allotted.

So far as the non-consentees are concerned, we are not prepared to
accept that by their action and/or inaction, they can claim parity for allotment p
with the consentees. The consentees have to be considered in priority as, at
the first available opportunity, they agreed to the offer of alternative plots of
smaller sizes. The non-consentees not only questioned the offer made by the
Administration to provide them plots of smaller sizes but even assailed the
government notification declaring major part of the land in the scheme as
reserved forest. They might have a legitimate right to approach the courts for G
necessary reliefs but having failed in their challenges in the court, they can
claim no right of being treated similarly with consentees who right from the
earliest opportunity were willing and trying through the Administration and
.+ the court for early allotment of alternative plots. The consentees and the non-
consentees, on the basis of their actions and inactions, constitute two different H
86 SUPREME COURT REPORTS (2004] SUPP. I S.C.R.

A classes of allottees and a differential treatment to them cannot be held to be
unjustified or in violation of Article 14 of the Constitution. On a just and
reasonable ground, the consentees deserve a more favourable treatment than
non-consentees more so because plots of small sizes available in the existing
scheme in Phase-I & II are extremely limited in number.

B ~fter mutual negotiations for settlement between the allottees and the
Administration failed, the Assistant Estate Officer, Chandigarh Administration
has filed a detailed affidavit on 16.2.2004 showing the latest position with
regarcl to the availability of alternative plots in the same scheme in phase-I
& II for which the original allotments were made and in the new scheme in
C phase-Ill in Mouli Jagran. We have to proceed on the facts mentioned in the
latest affidavit dated 16.2.2004 filed on behalf of the Administration. It is
necessary to briefly indicate the facts and developments which have been
brought to our notice in the affidavit and the proposals now made on behalf
of the Administration to accommodate the consentees and non-consentees. In
the affidavit, it has been stated that after the order dated 17.9.2003 of this
D Court, parties involved in the litigation were invited before a committee in
meetings held between 3.10.2003 to 12.12.2003. Other 164 applicants who
were also parties to the draw of lots on 27.3.1991 and some of whom are
intervenors or seeking impleadments as parties were also invited as a measure
personnel to them. In accordance with the new industrial policy of 1990, the
E parties in the court were required to furnish necessary information in the
prescribed form as to whether in their own name or in the name of their
spouses and children they own any plot in Mohali, Panchkula and in the
Union Territory of Chandigarh. The second information demanded was
whether the applicant is a government or semi-government employee because
there is prohibition for allotment of plot to such employees.
F
In the affidavit, it is further stated that, in accordance with the new
industrial policy, the environmental restrictions have been imposed categorising
different industrial projects into three categories i.e. Red, Orange and Green.
In accordance with the environmental norms, in the new industrial policy of
1990, the parties litigating were given option to submit their fresh project
G reports. Some of the parties neither provided necessary information on affidavit
nor submitted their revised project reports conforming to the environmental
norms. According to the Administration, allotments are possible only to such
parties who fulfil the conditions shown in the prescribed affidavit and conform
to environmental norms. On the basis of the information received in the
+.
H course of the mutual negotiations for settlement, it is reported to this Court
HIRA TIKKOO "·UNION TERRITORY, CHANDIGARH [DHARMADHIKARI, J.] 87

that 47 projects fall in red category and 4 projects fall in orange category. A
These projects cannot be considered to be set up as per the prevalent pollution
nonns. They can be considered if they submit fresh project reports which
comply with the latest environmental/pollution norms and are viable in the
existing marketing conditions. It has been stated on affidavit by the
Administration that out of 35 consentees who have furnished the necessary
infonnation, only 23 consentees are fulfilling the laid down criteria. The B
names of those 23 allottees with full details are shown in paragraph no. 7 of
the affidavit and the names and details of other 12 consentee allottees who
did not furnish complete infonnation and do not fulfil the requisite conditions
are also given in the same paragraph of the affidavit.

In the affidavit, there is a second category shown by the Administration
c
as am prisn;J such allottees from whom consent was not asked for as it was
proposed to allot them the same size of plot measuring one kanal which they
had applied for. In this category, from whom no consent was needed, are
allottees of one kanal of plots. Thirteen applicants have been found to have
given coptplete infonnation and fulfilling requisite environmental nonns. Their D
names are also mentioned under category-II of the affidavit.

We have stated above that there is no justification for the non-consentees
~~

to claim parity with consentees. The third category pointed out by the
Administration and some of whom are also before us represented through
their counsel are allottees of one kanal of plots. They are being offered same E
size of alternative plots and from them no consent was asked for. This category
of allottees of one kanal of plot are also required to be accommodated in the
available alternative plots.

On this identification of 23 consentees and 13 allottees of one kanal of F
plot each, the Administration is justifiably required to consider their cases to
allot them alternative plots available in industrial areas phase-I and phase-II
as shown in their chart (Annnexure-A) annexed to their affidavit. This chart
(annexure-A) annexed to the affidavit shall be read as part of our order and
is reproduced as under :-
G
ANNEXURE A

LIST OF INDUSTRIAL PLOTS LYING VA CANT IN THE
INDUSTRIAL AREA, PHASE I & II, CHANDIGARH.

Sr. Category Vacant Trees & Other Major Encroachment Total H
88 SUPREME COURT REPORTS [2004) SUPP. I S.C.R.

A Encroachments like Elect Transfonner
Which can be Electric pole, Telephone
removed pole which cannot be
removed

INDUSTRIAL AREA PHASE I
B I. 1.5 Kanai 4 5
2. I Kanai 8 9

INDUSTRIAL AREA PHASE II

3. 3 Kanai
c
4. l.5 Kanai 3 18 22
5. I Kanai 18 20
6. IO Marla 9 12 2 23

D Total 32 44 4 80

From the available plots of different sizes totalling 80, both the
consentees and allottees of one kanal of plots have to be acco~modated. The
directions made by the High Court in favour of the consentees are, therefore,
required to be suitably modified with additional directions which we propose
E to make in these batch of cases :-

So far as non-consentees are concerned, we have already held above
that they can claim no parity with the consentees and allottees of one kanal
of plots. The number of plots of smaller sizes are also limited and therefore,
the non-consentees cannot be allowed to compete with consentees and allottees
F of plot of one kanal.

In the latest affidavit submitted by the Administration mentioned above,
it has been stated that 152 acres of land has· been acquired in the Revenue
Estate of village Mouli Jagran and Raipur Kalan which fall entirely outside
the reserved forest area and are being developed as industrial area phase-Ill.
G According to the Administration since alternative sites available in industrial
areas phase-I & II as mentioned in annexure-A are limited, all other left~out
allottees can be accommodated in industrial area phase-III. The Administration
has, however, stated that in the new industrial zone Mouli Jagran, the cost of
acquisition and development has been much higher calculated at Rs. 2,892
H per sq. yard. Based on the above affidavit, the only relief that can be granted
HIRA TIKKOO v. UNION TERRITORY, CHANDIGARH [DHARMADHIKARI, J.] 89

to the non-consentees would be to pennit them to submit their willingness A
within a period of one month from the date of our order in writing to the
Administration to be considered for allotment of a suitable plot in the new
industrial zone i.e. Mouli Jagran but at the price prevailing on the date of
... such fresh allotment. Suitable direction is, therefore, required to be issued in
' favour of such willing non-consentees.
B
Now we are left with the individuals and parties falling in none of
the three categories i.e. ( 1) consentees, (2) non-consentees, or (3) allottees
of one kanal of plot. They were not parties before the High Court and
were invited to participate in the discussions and negotiations which have
taken place during pendency of these cases before us. They have approached C
by way of special leave petitions or applications seeking interventions or
impleadment as parties in the present cases. This group of individuals and
parties, who were not parties before the High Court either as petitioners
or respondents and who are merely intervenors or parties seeking impleadments
and/or have sought permission to file special leave petitions cannot be
allowed to join race for allotment of available alternative plots. It will D
have to be presumed that having not ventilated their grievances and enforced
their rights, if any, at any earlier stage, they have abandoned their claims.
Merely because during pendency of court proceedings, some rounds of
negotiations and discussions took place in which the Administration also
invited them, would not furnish them a cause of action to raise their E
claims which they had earlier given up by their inaction and lapse. In
adjusting equities and on rule of fairness, those who have languished and
slept over their rights have to be denied any relief more so when there has
been such a time lag between the original allotment and the proposed
allotment of alternative plots. In the meantime, there have been various
developments including escalation of land prices. Any speculative deals F
and attempt to take chance of getting allotment by such parties have to be
discouraged. We, therefore, refuse to grant any relief to remaining class
of consentees or non-consentees and other allottees who were not parties
in the litigation before the High Court.

As a result of detailed discussion aforesaid, the appeals and connected G
matters are disposed of by partly maintaining the directions contained in
the impugned order of the High Court but with the modifications, substitution
and addition of directions as mentioned below :-

l. The prayer of the appellants/petitioners for directing the authoritie~
H
90 SUPREME COURT REPORTS [2004) SUPP. I S.C.R.

A of Chandigarh Administration to .hand over possession of the
plots allotted on the basis of draw held in November, 1982 is
rejected.
2. The total available plots of different sizes as mentioned in
Annexure-A to the affidavit of the Administration of UTC, shall
B be allotted by draw of lots separately or jointly as per the
procedure evolved by the Administration to 23 consentees found
eligible in accordance with the new environmental norms and to
13 allottees of one kanal plot. It. is for the Administration of
UTC to work out the manner in which draw of lots will be held
between 23 consentees and 13 allottees of one kanal plot for the
c available number of plots of different sizes as contained in
Annexure-A to the affidavit. It is made clear that the
Administration of UTC will have liberty keeping in view the
industrial projects submitted by the consentees and other
restrictions, if they make it necessary to suitably alter the sizes
D of plots to accommodate the identified.23 consentees. It is clarified
that allotment of plots from the area of the scheme which falls
within restricted 900 metres zone from the aii--base under Aircrafts
Act, would be granted by the Administration with a condition
that if in future, any such restriction is reimposed, the allotments
may be cancelled and there would be no liability on the
E Administration of UTC to pay any damage or compensation to
the parties due to non-utilisation of plots or its cancellation. If
the allotments of plots in the restricted zone are cancelled due to
restriction aforesaid, the price paid for the plots shall be refunded
to the parties concerned without any liability of interest on the
price which remained as deposit with the Administration.
F
3. The consentees and al/ottees of one kanal plot, who even though
found eligible for allotment, because of limited number of plots
(as mentioned in a~nexure-A), do not get accommodation in the
available plots, they be considered on the same price paid by
them for alternative plots in the new industrial area phase-III i.e.
G Mouli Jagran. It is made clear that the requirement of the Act
and the Rules and the new environmental norms as existing on
the date of fresh allotment of plots in the industrial area phase-
III would be made applicable to such consentees and allottees of
one kanal plot.
•
H
HIRA TIKKOO v. UNION TERRITORY. CHANDIGARH [DHARMADHIKARI, J.) 91

4. The non-consentees shall be granted by the Administration of A
UTC, option by asking them to submit their willingness in writing
within a period of one month from the date of this order for
considering allottment to each of them a suitable plot in the new
industrial zone Phase lll at Mouli Jagran. It is left to the
Administration of UTC to evolve a fair and just method of B
allotment by draw of lots in accordance with the Act and the
Rules. It is made clear that the allotment of plots in the new
industrial area III i.e. Mouli Jagran would be at the price prevailing
on the date of fresh allotments. The price with interest already
paid by the non-consentees for their original plots, if so far not
refunded to them, shall be adjusted towards the total price payable C
for the new sites. It is also made clear that in accordance with
existing industrial policy and the environmental norms, the
allottees will have to submit their project reports for considering
viability of their proposed industries by the Administration.
In the event, the non-consentees are unwilling to take plots in D
the new industrial zone phase III or their project reports are
ultimately found to be not approvable, the price deposited by
them for the original plots would be refunded to them with interest
at the rate of 12% per annum from the date of initial deposit.
5. The reliefs in the nature of directions made in favour of consentees E
and non-consentees and allottees of one kanal plot are restricted
only to such of them who were parties before the High Court. All
claims of remaining consentees or non-consentees or allottees of
one kanal plot, who were not parties in the cases before the High
Court, stand rejected.
F
6. Notification dated 28.4.2000 containing new Industrial Policy
would not be made applicable to the allottees of plots in phase-
1 & II who ate successful in fresh draw of lots to be held under
the above directions.
7. The Administration of UTC shall complete the reqms1te G
formalities and carry out the directions made above in accordance
with law within a period of four months from the date of this
order and hand over possession of the plots to the successful
allottees.

8. All applications seeking interventions, impleadment as parties
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92 SUPREME COURT REPORTS [2004) SUPP. I S.C.R.

A and special leave petitions filed by parties, who were not parties
before the High Court, are, hereby, rejected.

As a result of the discussion aforesaid, the appeals and connected
matters are disposed of by substituting/modifying above-mentioned directions
for the directions contained in the impugned order of the High Court.
B
Keeping in view the peculiar circumstances of the case, we make no
order as to costs which shall be born~ by the parties as incurred by them.

K.K.T. Appeals/Petitions disposed of.

.,.