M.P. MATHUR AND ORS.versusD.T.C. AND ORS.

                         M.P. MATHUR AND ORS.                                   A
                                     v.
                             D.T.C. AND ORS.

                           NOVEMEBR 24, 2006

               [ARIJIT PASAYA I AND S.H. KAPADIA, JJ.]                          B


       Doctrine ofpromissory estoppel-Tenements constructed by Government
 under Scheme for Industrial Workers and Economically Weaker Sections of
 the Community-Scheme amended allowing transfer of allotted houses on C
 ownership basis to occupants-Government corporation passing resolution
for transfer of allotted houses on ownership basis to occupants-Occupants
already retired from service-Corporation having only 480 tenements to
accommodate 254 industrial workers-Resolution not communicated to
occupants-Sale consideration not fIXed-Occupants never called upon to
make any payment-Corporation subsequently passing resolution rescinding D
decision to sell tenements and refusing to implement policy decision of
Government of India-Occupants filing suit for declaration of entitlement to
transfer of tenements-Held, Scheme was only an enabling scheme and not
mandatory and corporation not obliged to sell tenements under the scheme--
Resolution providing for transfer of ownership in favour of occupants was . E
tentative and not final and binding decision and did not create any legal
right by itself-Government required to strike balance between competing
claims-Larger public interest precluded invocation ofdoctrine ofpromissory
estoppel-In the facts held, there is no contract between parties and decree
passed by trial court rightly set aside-Specific Relief Act, I963-Section 34.
                                                                                F
     Respondent -Delhi Transport Corporation constructed 300 tenements
under Integrated Subsidised Housing Scheme for Industrial Workers and
Economically Weaker Sections of the Community, 1952 and allotted the said
tenements to the appelhmts-plaintiffs who were its industrial workers.
Appellants have retired from service but have continued to reside in the said
quarters. The said scheme was amended in 1978 allowing transfer of allotted     G
houses on ownership basis to the appellants. Respondent passed resolutions
dated 18.4.1979 and 31.8.1979 to sell said service quarters to appellants.
However, the respondent view its subsequent resolution dated 3.12.1979 read
with resolution dated 2.3.1981 rescinded he decision to sell quarters I
                                    519                                         H
    520                    SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A   tenements to the appellants. Appellants filed suit in the High Court for
    declaration of entitlement to the transfer of the said tenements which was
    decreed by the Single Judge. Respondent preferred appeal which was allowed
    by the Division bench. Hence the present appeal.

          Appellants contended that it was not open to the respondent to question
B   the decision of Central Government to sell tenements to occupants; that a
    legal right was created in their favour vide resolution dated 18.4.1979 read
    with resolution dated 31.8.1979 by itself; and alternatively, that even ifthere
    was no legal right, an estoppel was created in their favour by the conduct of
    respondent as appellants had changed their position to their detriment relying
C   upon the promise made by respondent and therefore it was not open to
    respondent to resile from its earlier decision vide subsequent resolution dated
    3.12.1979.

          Respondent contended that the scheme was only an enabling scheme
    and did not create any obligation on respondent to sell their houses; that
D   decision dated 18.4.1979 was only tentative; that passing of resolution was
    never communicated to any of the appellants; that no letter of allotment was
    ever issued by the respondent; and that decision not to sell tenements was
    particularly taken as respondent had only 480 tenements which were
    inadequate for housing 5254 industrial wdrkers in April, 1979.

E         Dismissing the appeal, the Court

          HELD: 1. Promissory estoppel is based on equity or obligations. It is
    not based on vested right. In equity the court has to strike a balance between
    individual rights on one hand and the larger public interest on the other hand.
    Freedom to contract is a common law civil liberty enjoyed by all persons. But
F   when the Government is contracting with private parties this common law
    freedom is circumscribed by the principles of administrative law which
    requires larger public interest to be taken into account. The larger public
    interest is not only for accommodating retiree workmen but also to
    accommodate in-service workmen. Even applying the principles enshrined in
G   Article 39 (b) and (c) of the Constitution, egalitarian equality requires the
    Government to strike a balance between competing claims. Even in the realm
    of social justice, en which our Constitution is founded, the administration
    has to strike a balance between the competing claims. [529-A-CJ

        Sales Tax Officer and Anr. v. Shree Durga Oil Mills and Anr. (1998) 1
H   sec 572, Sharma Transport v. Government of A.P. and Ors., [2002] 2 sec
....
                                  M.P. MATHUR v. D.T.C.                           521
       188 and Bannari Amman Sugars Ltd. v. Commercial Tax Officer and Ors.,             A
       (2005) I SCC 625, relied on.

              2.1. In the present case, respondent-OTC, in principle, had agreed to
       transfer the tenements on ownership basis to the industrial workers. However,
       when OTC examined the ground reality, it found acute shortage of resources
       coupled with increased costs of replacement running into Rs. 3 crores. The        B
       Central Government also did not fund the full cost of construction. OTC had
       to accommodate approximately 5000 in-service employees in 480 tenements.
       DTC, at the relevant time was a loss-marking public sector enterprise. Despite
       these difficulties, OTC did try to accommodate the claims of the appellants.
       However, they could not. In the circumstances, ultimately DTC informed            C
       Government of India that under the above circumstances it was not possible
       for it to implement the scheme. Therefore, the conduct of OTC cannot be
       faulted. (529-C-E]

               2.2. Moreover, the decision to allot the tenements on ownership basis
       vide Resolution dated 31.8.1979 was a tentative decision. There was no contract   D
       entered into by OTC with any individual workman. OTC was a lessee. DOA
       was a lessor. DTC had to work out the cost-benefit ratios with DOA. That
       exercise was never undertaken. Not a single communication was ever sent by
       OTC. No formal sale-conditions were ever fixed or communicated by OTC to
       the appellants. None of the appellants was ever asked to pay to DTC the final
       sale consideration amount. In the circumstances, Resolution dated 31.8. I 979     E
       was a tentative decision and not a final and binding decision as alleged.
       Therefore, it cannot be said that the said Resolution created a legal right by
       itself. There is no bias, discrimination or arbitrariness in Resolution of OTC
       dated 3.12.1979 by which OTC recalled its earlier decision. [529-E-H]

              2.3. Even the Central Government concurred with OTC in its decision
                                                                                         F
       not to implement the Scheme. The scheme was an enabling scheme. It was
       not mandatory. OTC was not obliged to sell the tenements under the Scheme.
       The Government of India had funded DTC to a very small extent. DTC was in
       fact required to repay the loan taken from the Government of India with
       interest. In the circumstances, it was open to DTC to recall its decision of G
       allotting the said tenements by way of sale to the occupants. Under the
       circumstances, it cannot be said that impugned Resolution dated 2.3.1981
       passed by DTC of not selling the tenements was in any way arbitrary, baised
       or discriminatory. (530-A-BI

                                                                                         H
    522                     SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A         3. There is no merit in the contention advanced on behalf of the appellants
    that relying on the promise of DTC they altered their position to their prejudice
    by not opting for purchase under some other housing schemes. Resolution
    dated 31.8.1979 approving the sale was deferred on 3.12.1979 by the
    Chairman pointing out the above difficulties. Moreover no communication was
B   ever sent to appellants individually calling upon them to make payment. Hence
    there was no representation as alleged. 1530-C-DJ

           4.1. The present suit is based on equity. The term "equity" has four
    different meanings, according to the context in which it is used. Usually it
    means "an equitable interest in property". Sometimes, it means "a mere
C   equity", which is a procedural right ancillary to some right of property, for
    example, and equitable right to have a conveyance rectified. Thirdly, it may
    mean "floating equity", a term which may be used to describe the interest of
    a beneficiary under a will. Fourthly, "the right to obtain an injunction or other
    equitable remedy". In the present case, the appellants have sought a remedy
    which is discretionary. They have instituted the suit under Section 34 of the
D   Specific Relief Act, 1963. The discretion which the Court has to exercise is
    a judicial discretion. That discretion has to be exercised on well-settled
    principles. Therefore, the Court has to consider~the nature of obliga!ioo in
    respect of which performance is sought, circumstances under which the
    decision came to be made, the conduct of the parties and the effect of the Court
E   granting the decree. In such cases, the Court has to look at the contract. The
    Court has to ascertain whether there exists an element of mutuality in the
    contract. If there is absence of mutuality the Court will not exercise discretion
    in favour of the plaintiffs. Even if, want of mutuality is regarded as
    discretionary and not as an absolute bar to specific performance, the Court
    has to consider the entire conduct of the parties in relation to the subject-
F   matter and in case of any disqualifying circumstances the Court will not grant
    the relief prayed for.1530-F-H; 531-AJ

          Equity by Snell, 31st Edn., page 366 referred to.

          4.2. In the present case, applying the above test, no iota of mutuality is
G found. There is no contract between DTC and the appellants. There is no
    communication at any point of time between DTC and the appellants. No sale-
    consideration was ever fixed. The appellants were never called upon to make
    payment. The decision to allot remained tentative. In the circumstances, neither
    contract nor equity existed at any point of time so as to compel DTC to convey .
H   the tenements to the appellants. 1531-B-C]
                     M.P. MATHUR v. D.T.C. [KAPADIA, J.]                    523

      5. In the present case the doctrine of promissory estoppel had no            A
application. On balancing of equities it is clear that OTC which is a public
sector undertaking had to act in public interest in the sense that it had to
keep the transport service running for which they had to accommodate in-
service industrial workers which they could not have done if it had to sell the
existing service quarters to the reti~ees. In the circumstances, the Division      B
Bench was right in setting aside the decree passed by the Single Judge.
                                                                    1533-D-E)
       CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5281 of2005.

      From the Judgment and Order dated 19.2.2003 of the High Court of Delhi
 at New Delhi in R.F.A. (O.S.) No. 4 of 1992.                                      C
     K.K. Venugopal, Syeda Hina Rizvi, Gopal Sankara Narayanan, Prasad
Vijaykumar and Syed Shahid Hussain Rizvi for the Appellants.

       T.L.V. Iyer, A. Subhashini for the Respondent No. 1.
                                                                                   D
      T.S. Doabia, Tufail A. Khan, Ms. Sunita Sharma, R.C. Kathia, D.S.
 Mabra, V.K. Verma and Anil Katiyar for the Respondents No. 2 & 3.

      The Judgment of the Court was delivered by

      KAPADIA, J. This civil appeal is filed by the original plaintiffs and is     E
directed against the judgment and order passed by the Division Bench of the
Delhi High Court dated 19.2.2003 in RF A(OS)No.4/1992 reversing the decision
of the Ld. Single Judge in Suit No.308 of 1983.

        In this civil appeal we are required to consider the scope of Resolution
·No.55/79 dated 18.4.1979 and Resolution NQ.139/79 dated 31.8.1979 passed by       F
 the Board of Delhi Transport Corporation. Plaintiffs contended that a legal
 right was created in their favour under the above Resolution dated 31.8. 79 by
 itself and that Delhi Transport Corporation was estopped from recalling its
 decision vide subsequent Resolution No.179/79 dated 3.12.79 read with
 Resolution No.35/81 dated 2.3.81.                                                 G
      The undisputed facts are as follows.

     Between 1962-63 and 1965-66, 5144 tenements were constructed by
Municipal Corporation of Delhi in six colonies of the Delhi Administration,
namely, Karampura, Nehru Nagar, Giri Nagar, Vishwakanna Nagar, Hari Nagar          H
    524                     SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A and G.T. Road under Integrated Subsidised Housing Scheme for Industrial
   Workers and Economically Weaker Sections of the Community, I 952 (for
   short, 'the Scheme'). Appellants herein are industrial workers and they were
   allotted service quarters in Hari Nagar and G.T. Road colonies. They have
   retired from service. However, they have continued to reside in these quarters
B till today. According to the appellants, 300 quarters were constructed by Delhi
   Transport Undertaking at Hari Nagar and G.T. Road under the above Scheme.
   ln I 971 Delhi Transport Undertaking was converted into Delhi Transport
   Corporation (for short, 'OTC'), taking 300 tenements out of the quota of Delhi
   Administration. In 1978 the above Scheme was amended allowing OTC to
   transfer the allotted houses on ownership basis to the occupants (plaintiffs).
C The said Scheme was sponsored by the Government of India. According to
   the appellants, out of 5144 tenements, 4844 tenements were transferred by the
   Delhi Administration in favour of the occupants. This was done in 1979. The
   balance was 300 tenements belonging to OTC in the two colonies of Hari
   Nagar and G.T. Road which remained untransferred. OTC Workers Union
D protested when OTC did not take steps to transfer the 300 tenements to the
   occupants. They threatened to proceed on strike. On 28.10.1978 a Settlement
   was signed under Industrial Disputes Act between OTC and the Union of
  workers under which OTC was given ~ix months time to take decision on the
   workers' demand for transferring of the tenements to the occupants. Before
  expiry of six months, OTC, by way of Resolution dated 18.4.1979, decided in
E principle to sell the service quarters to the occupants. The occupants were
   asked to fill up certain forms. They were asked to furnish certain information
  to OTC. This was done by the appellants. By another Resolution dated
   31.8.1979 OTC approved the Scheme to sell the tenements to the occupants
  subject to ce1tain conditions being satisfied by each of the occupants. Even
p in the Annual Administration Report, OTC stated that action has been taken
  to transfer ownership of 300 service quarters constructed under the above
  Scheme. According to the appellants, OTC took the above steps in line with
  the decision of the Delhi Administration dated 9.2.1979 to transfer 4844
  tenements out of 5144 tenements in four colonies, namely, Karampura, Nehru
  Nagar, Giri Nagar, Vishwakarma Nagar in favour of their occupants and,
G therefore, the appellants herein were sure that in their case the decision to
  transfer the tenements on ownership basis would be implemented. However,
  on 3 .12.1979 the Chairman of OTC requested the Board to reconsider its
  decision to sell in the light of increased replacement cost of about Rs.3 crores,
  particularly when OTC had huge accumulated losses. By Jetter dated 16.5.1980
H the Government of India invited OTC to implement its decision to sell the
  tenements to the occupants. Ultimately, vide Resolution dated 2.3.1981 the
...                      M.P. MATHUR v. D.T.C. [KAPADIA. J.]                    525

      OTC Board rescinded its decision to sell and stated that it will not implement   A
      the policy decision of the Government of India. Aggrieved by the said
      Resolution, the appellants herein filed Suit No.308/83 in the Delhi High Court
      seeking a declaration of entitlement to the transfer of these properties. The
      suit was decreed by the learned Single Judge on 11.9.1991. However, the
      appeal preferred by OTC was allowed by the impugned judgment. Hence this         B
      civil appeal.

              Mr. K.K. Venugopal, learned senior counsel appearing on behalf of the
       appellants (plaintiffs), submitted that Resolution of OTC dated 2.3.1981 was
       flawed and baseless. According to the learned counsel, the representation
       made to the appellants by OTC stood withdrawn without cogent and sufficient C
       reasons. In this connection, it was urged that the above Scheme was formulated
       by the Central Government. It was reviewed by the Central Government on
       9 .2.1978. Therefore, it was not open to OTC to question the decision of the
       Central Government to sell the tenements to the occupants. Learned Counsel
       further contended that except 300 tenements every other tenement under the D
       Scheme has been sold. Only 300 tenements belonging to OTC were not
       transferred. In the circumstances, it was contended that OTC had erred in
       stating that no public sector undertaking had decided to sell the houses as
       mentioned in the above Resolution. In the above Resolution one of the
       grounds taken by OTC was that the direction of the Government of India to
       OTC to implement its policy decision to sell the tenements was E
       recommendatory. Learned counsel submitted that even assuming without
       admitting that the instructions given by the Government of India were
       recommendatory even then OTC had by way of Resolutions dated 18.4.1979
       and 31.8.1979 had represented to the appellants that it had taken the decision
       to sell the tenements to the occupants and, therefore, OTC was estopped from
       resiling from its decision to sell. Learned counsel further urged that in F
       Resolution dated 2.3.1981 it is stated that OTC had 24000 employees who
       were required to be accommodated. It was urged that this was a false excuse.
       It was urged that the Scheme was meant for industrial workers. It was urged
      that 24000 employees, at the relevant time, was the total workforce. The
      employees who were not industrial employees were not eligible under the G
      Scheme to buy the tenements. Moreover, OTC Union had no objection to the
      said tenements being transferred to the appellants and, therefore, there was
      no reason for OTC to withdraw its earlier decision to sell the tenements to
      the occupants. Learned counsel urged that it was never the case of DTC that
      these service quarters were required to accommodate the in-service employees. H
    526                    SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.
                                                                                      ....
A It was urged that these tenements were constructed with the contributions
    of the Central Government and, therefore, OTC was not entitled to utilize
    these tenements to house employees not covered by the Scheme. Learned
    counsel urged that as late as in 1985 OTC Board had offered to transfer
    ownership to the occupants. Therefore, the decision to withdraw the earlier
B   decision to sell the tenements was without any basis. Learned counsel
    submitted that there is no merit in the argument of OTC that OTC was
    incurring accumulated losses and it was unable to meet the replacement cost.

          According to the appellants hundred acres of land belonging to OTC
    for residential accommodation situated at Rohini Terminals, Vinod Nagar,
C   Okhla III, Partap Nagar, Punjabi Bagh and Kanjhawala, were not being utilized
    by OTC. In 1986 land was also allotted to OTC at Kondli for construction of
    500 tenements. Even today, according to the appellants, a few tenements were
    lying vacant in Hari Nagar and G.T. Road colonies. On behalf of the appellants
    it was further pointed out that OTC colony at Shadipur was not even covered
    by the Scheme and therefore to say that the occupants of Shadipur Colony
D   would also raise a similar demand, had no merit.

          Learned counsel further submitted that the impugned judgment was
    erroneous. It was urged that the suit is based on promissory estoppel which
    is a principle based on equity and which principle requires no contractual or
E   statutory basis. Learned counsel urged that there was a distinction ~.~~een
    the obligation of the State based on a promise and an obligation based on
    a contract. In the present case, according to the learned counsel, the suit was
    founded on the promise made by OTC to the appellants. It was not based on
    the contract. Therefore, according to the learned couns_el, the High Court
    erred in holding that no legal right was shown in the tenements. Learned
F   counsel urged that the appellants had changed their position to their detriment
    relying on the promise made by OTC. They acted to their prejudice by not
    applying for and obtaining alternate accommodation. They acted to their
    prejudice by not availing of any other scheme for Low Income Group.
    Therefore, according to the learned counsel, the High Court had erred in
G   holding that the appellants have not changed their position to their detriment.
    Learned counsel urged that the High Court had erred in holding that larger
    interest of employees precluded the invocation of promissory estoppel.
    According to the learned counsel, the only reason shown by OTC in Resolution
    dated 2.3. I98 l was that other employees may make similar demands. However,
    as stated above, according to the learned counsel, the Workers Union had
H   made it clear that they would not object to allotment to the sale of the
                          M.P. MATHUR v. D.T.C. [KAPADIA, J.]                     527

      tenements by OTC to the appellants and, therefore, it was not open to DTC           A
      to say that they expected other employees to make similar demands. Learned
       counsel urged that Resolutions dated 18.4.1979 and 31.8.1979 constituted a
       promise or representation made by the Board to the appellants. It was contended
      that DTC had agreed to decide the matter within six months. They sought
       information from the appellants regarding terms and conditions of transfer;        B
      they wrote letters in which details of the occupants were sought; the Annual
      Report of DTC also indicates decision to transfer and, therefore, it was
      incumbent on DTC to act on promise/representation made to the appellants
      who had altered their position to their prejudice by not resorting to strike,
      maintaining industrial peace, not applying for alternate accommodation and
      by not availing of any other Scheme. In the circumstances, learned counsel,         C
      therefore, urged that Resolution dated 2.3. l 98 l withdrawing the representation
      made to the appellants should be set aside and that DTC should be asked
...   to implement its promise/representation to sell the tenements to the appellants .

             Mr.·'f.L.V. Iyer, learned senior counsel appearing on behalf of DTC,         D
      submitted that the question of transfer of the buildings in the above two
      cqj{.mies to the occupants came for consideration before the DTC Board on
      30.8.1978 when the consideration was postponed for further examination due
      to the increased cost of the land which had risen manifold and also for other
      reasons, nan:iely, similar demands from other workmen, huge replacement
      costs, and the fact that the Government of India did not fund DTC with the          E
      entire costs of construction amounting to Rs.35.04 lacs. Learned counsel
      pointed out that only an amount of Rs.6.25 lacs was given by the Central
      Government which was given as a loan. Rs. l .56 lacs was paid as subsidy.
      OTC had to pay back the loan with interest. In fact, the balance could not
      be paid because of recurring losses. These were reasons for postponing the          F
      decision to sell the tenements. It was further pointed out that the matter again
      came for consideration before the OTC Board on 8 .3 .1979 pursuant to the
      Memorandum of settlement under the Industrial Disputes Act. In the said
      meeting of the DTC Board they considered the letter of the Government of
      India dated l 4.2. l 979 to permit employers (OTC) to sell the houses. However,
      according to the learned counsel, the Scheme was an enabling scheme which           G
      did not create any obligation on OTC to sell their houses. Learned counsel
      submitted that similarly the matter was again placed before DTC on 18.4.1979
      when OTC Board agreed in principle to sell the houses to the occupants.
      However, the details had to be worked out. The matter was required to be
      .considered with the lessor, namely, DDA. Learned counsel submitted that the H
    528                     SUPREME COURT REPORTS r2006] SUPP. 9 S.C.R.

A   decision dated 18.4.1979 was tentative decision which required further
    examination of details with DOA and Government of India.

          Learned counsel for OTC submitted that passing of Resolution was
    never communicated to any of the appellants; that, no letter of allotment were
    ever issued; that, various clarifications were sought from Government of
B   India; that, the decision approving proposal of sale on 31.8.1979 was again
    subject to certain clarifications from the Central Government; that, since the
    Chairman of OTC had reservations, the matter was placed before OTC for
    further consideration on 3.12.1979 when the matter was discussed at length
    and ultimately the Board decided that it would not be possible to implement
C   the policy decision of the Government of India to sell the flats to the occupants
    on ownership basis for the reasons indicated above. Thus ultimately, according
    to the learned counsel, on 2.3.1981 the OTC Board took the decision that the
    tenements could not be sold to the appellants. This decision was particularly
    taken because OTC had only 480 tenements allotted to it which were inadequate
    for housing 5254 industrial workers in April 1979. In March 1981 there were
D   5839 industrial workers. In the circumstances, the decision was taken on
    2.3.1981 stating that there was no ground for sale of tenements to the
    appellants.

          Learned counsel submitted that there is no merit in the argument
    advanced on behalf of the appellants that Resolution dated 18.4.1979 conferred
E   a right on the appellants to have the houses transferred to them. Learned
    counsel pointed out that the suit was filed under Section 34 of the Specific
    Relief Act, 1963 in which there was no prayer for an industrial relief directing
    OTC to transfer the tenements to the plaintiffs. It was further pointed out that
    in the suit there was no prayer for specific performance and that the entire
F   suit was based on the plea of the promissory estoppel. In the circumstances,
    learned counsel submitted that there was no merit in the suit filed by the
    appellants.

           As stated above, two contentions have been raised on behalf of the
    plaintiffs. Firstly, the appellants contended that a legal right was created in
G   their favour vide Resolution No.55/79 dated 18.4.1979 read with Resolution
    No.139/79 dated 31.8.1979 by itself. Secondly, they contended that even if
    there was no legal right, an estoppel was created in their favour by the
    conduct of DTC and, therefore, it was not open to OTC to resile from their
    earlier decision vide Resolution No.179/79 dated 3 .12.1979.

H         We do not find any merit in the above two contentions.
                         M.P. MATHUR v. D.T.C. [KAPADIA, J.]                   529
              As regards the first contention, we may observe that promissory A
      estoppel is based on equity or obligations. It is not based on vested right.
      In equity the court has to strike a balance between individual rights on one
      hand and the larger public interest on the other hand. Freedom to contract
      is a common law civil liberty enjoyed by all persons. But when the Government
      is contracting with private parties this common law freedom is circumscribed
      by the principles of administrative law which requires larger public interest to B
      be taken into account. We must remember that larger public interest is not
      only for accommodating retiree workmen but also to accommodate in-service
      workmen. Even applying the principles enshrined in Article 39 (b) and (c) of
      the Constitution, egalitarian equality requires the Government to strike a
      balance between competing claims. Even in the realm of social justice, on C
      which our Constitution is founded, the administratio_n has to strike a balance
      between the competing claims. In the present case, DTC, in principle, had
      agreed to transfer the tenements on ownership basis to the industrial workers.
      However, when OTC examined the ground reality, it found acute shortage of
      resources coupled with increased costs of replacement running into Rs.3
      crores. The Central Government also did not fund the full cost of construction. D
      OTC had to accommodate approximately 5000 in-service employees in 480
      tenements. DTC at the relevant time was a loss-making public sector enterprise.
      Despite these difficulties, DTC did try to accommodate the claims of the
      plaintiffs. However, they could not. In the circumstances, ultimately OTC
      informed Government of India that under the above circumstances it was not E
      possible for it to implement the scheme. Therefore, in our view the conduct
      of OTC cannot be faulted. Moreover, as stated above, the decision to allot
     the tenements on ownership basis vide Resolution No.139/79 dated 31.8.1979
      was a tentative decision. There was no contract entered into by DTC with any
      individual workman. OTC was a lessee. DOA was a lessor. DTC had to work
     out the cost-benefit ratios with DOA. That exercise was never undertaken. F
     Not a single communication was ever sent by OTC to the plaintiffs. No formal
     sale-conditions were ever fixed or communicated by OTC to the plaintiffs.
     None of the plaintiffs was ever asked to pay to OTC the final sale consideration
     amount. In the circumstances, Resolution dated 31.8.1979 bearing no.139179
     was a tentative decision and not a final and binding decision as alleged. G
..   Therefore, it cannot be said that the said Resolution created a legal right by
     itself. We do not find any bias, discrimination or arbitrariness in Resolution
     of DTC bearing no.179/79 dated 3.12.1979 by which OTC recalled its earlier
     decision. DTC used to make losses. The replacement cost had shot up to Rs.3
     crores. The number of industrial workers to be accommodated had risen
     drastically. Against 480 tenements OTC had industrial workforce of 5000 H
    530                     SUPREME COURT REPORTS [2006] SUPP. 9 S.C.R.

A   employees (in-service). They had to be accommodated. Even the Central
    Government concurred with OTC in its decision not to implement the Scheme.
    The Scheme was an enabling scheme. It was not mandatory. DTC was not
    obliged to sell the tenements under the Scheme. The Government of India had
    funded DTC to a very small extent. OTC was in fact required to repay the loan
B   taken from the Government of India with interest. In the circumstances, it was
    open to OTC to recall its decision of allotting the two colonies by way of sale
    to the occupants. Under the circumstances, it cannot be said that impugned
    Resolution No.35/81 dated 2.3.1981 passed by DTC of not selling the tenements
    was in any way arbitrary, biased or discriminatory. We also do not find any
    merit in the contention advanced on behalf of the appellants that relying on
C   the promise of DTC they altered their position to their prejudice by not ·opting
    for purchase under some other housing schemes. That, they did not buy the
    flat elsewhere all these years. There is no merit in the above contention.
    Resolution dated 31.8.1979 approving the sale was deferred on 3 .12.1979 by
    the Chairman pointing out the above difficulties. Moreover no communication
    was ever sent to appellants individually calling upon them to make payment.
D   Hence there was no representation as alleged.

          Coming to the second contention advanced on behalf of the plaintiffs,
    the question we have to ask is: whether, on the facts and circumstances of
    this case, the plaintiffs could compel transfer of tenements in their favour on
E   the basis of promissory estoppel.

           The present suit is based on equity. The term "equity" has four different
    meanings, according to the context in which it is used. Usually it means "an
    equitable interest in property". Sometimes, it means "a mere equity'', which
    is a procedural right ancillary to some right of property, for example, an
p   equitable right to have a conveyance rectified. Thirdly, it may mean "floating
    equity", a term which may be used to describe the interest of a beneficiary
    under a will. Fourthly, "the right to obtain an injunction or other equitable
    remedy". In the present case, the plaintiffs have sought a remedy which is
    discretionary. They have instituted the suit under Section 34 of the 1963 Act.
    The discretion which the Court has to exercise is a judicial discretion. That
G   discretion has to be exercised on well-settled principles. Therefore, the Court
    has to consider - the nature of obligation in respect of which performance is
    sought, circumstances under which the decision came to be made, the conduct
    of the parties and the effect of the Court granting the decree. In such cases,
    the Court has to look at the contract. The Court has to ascertain whether there
H   exists an element of mutuality in the contract. If there is absence of mutuality
                       M.P. MATHUR v. D.T.C. [KAPADIA. J.]                    531

  the Court will not exercise discretion in favour of the plaintiffs. Even if, want A
  of mutuality is regarded as discretionary and not as an absolute bar to
  specific performance, the Court has to consider the entire conduct of the
  parties in relation to the subject-matter and in case of any disqualifying
  circumstances the Court will not grant the relief prayed for [Snell's Equity,
  31st Edn., page366]. In the present case, applying the above test, we do not
  find an iota of mutuality. There is no contract between DTC and the plaintiffs. B
  There is no communication at any point of time between DTC and the
  plaintiffs. No sale-consideration was ever fixed. The plaintiffs were never
  called upon to make payment. The decision to allot remained tentative. In the
  circumstances, neither contract nor equity existed at any point of time so as
  to compel DTC to convey the tenements to the plaintiffs.                          C
        In the case of Sales Tax Officer and Anr. v. Shree Durga Oil Mills and
  Anr. [1998] I SCC 572, this Court held that even an Industrial Policy Resolution
- , can be changed if there is an overriding public interest involved. In that case
    it was contended on behalf of the State that various notifications granting
    sales tax exemptions to the dealers resulted in severe resource crunch. On        D
    reconsideration of the financial position, it was decided to limit the scope of
    the exemption notifications issued under Section 6 of the Orissa Sales Tax
    Act. This Court held that withdrawal of notification was done in public
    interest and that this Court will not interfere with any action taken by the
    Government in public interest. It was further observed that public interest       E
    must override any consideration of private loss or gain and, therefore, the
    plea of change of policy on the basis of resource crunch was sufficient for
    dismissing the case of the assessee under the Sales Tax Act of Orissa based
    on the doctrine of promissory estoppel.

        In the case of Sharma Transport v. Government of A.P. and Ors., [2002]        p
  2 SCC 188, this Court speaking through one of us, Pasayat, J., vide para 23
  observed as follows:

              "If it can be shown by the Government that having regard to the
          facts as they have transpired, it would be inequitable to hold the
          Government or public authority to the promise or representation made G
          by it, the court would not raise an equity in favour of the promise and
          enforce the promise against the Government. The doctrine of
          promissory estoppel would be displaced in such a case, because on
          the facts, equity would not require that the Government should be
          held bound by the promise made by it. But the Government must be H
    532                    SUPREME COURT REPORTS [2006) SUPP. 9 S.C.R.

A          able to show that in view of the fact as has been transpired, public
           interest would not be prejudiced. Where the Government is required
           to carry out the promise the Court would have to balance the public
           interest in the Government's carrying out the promise made to the
           citizens, which helps citizens to act upon and alter their position and
           the public interest likely to suffer if the promises were required to be
B          carried out by the Government and determine which way the equity
           lies. It would not be enough just to say that the public interest
           requires that the Government would not be compelled to carry out the
           promise or that the public interest would suffer if the Government
           were required to honour it. In order to resist its liability the Government
c          would disclose to the court the various events insisting its claim to
           be exempt from liability and it would be for the court to decide
           whether those events are such as to render it inequitable to enforce
           the liability against the Government."

          Similarly, in the case of Bannari Amman Sugars Ltd. v. Commercial Tax
D   Officer and Ors., [2005] I SCC 625, the Division Bench of this Court speaking
    through one of us, Pasayat, J., vide paras 19 and 20 observed as follows:

           "19. In order to invoke the doctrine of promissory estoppel clear,
           sound and positive foundation must be laid in the petition itself by
           the party invoking the doctrine and bald expressions without any
E          supporting material to the effect that the doctrine is attracted because
           the party invoking the doctrine has altered its position relying on the
           assurance of the Government would not be sufficient to press into aid
           the doctrine. The Courts are bound to consider all aspects including
           the results sought to be achieved and the public good at large,
           because while considering the applicability of the doctrine, the Courts
F
           have to do equity and the fundamental principles of equity must for
           ever be present in the mind of the Court.

            20. In Shrijee Sales Corporation and Anr. v. Union of India [1997] 3
            sec 398, it was observed that once public interest is accepted as the
            superior equity which can override individual equity the principle
G
            would be applicable even in cases where a period has been indicated
            for operation of the promise. If there is a supervening public equity,
            the Government would be allowed to change its stand and has the
           ·power to withdraw from representation made by it which induced
            persons to take certain steps which may have gone adverse to the
H           interest of such persons on account of such withdrawal. Moreover,
                    M.P. MATHUR v. D.T.C. [KAPADIA, J.)                     533
        the Government is competent to rescind from the promise even ifthere       A
        is no manifest public interest involved, provided no one is put in any
        adverse situation which cannot be rectified. Similar view was expressed
        in Pawan Alloys and Casting Pvt. Ltd v. U.P. State Electricity Board
        and Ors. AIR [1997] SC 3910, and in Sales Tax officer and Anr. v.
        Shree Durga Oil Mills and Anr. [1998] I SCC 572, and it was further
        held that the Government could change its industrial policy if the         B
        situation so warranted and merely because Resolution was announced
        for a particular period, it did not mean that the government could not
        amend and change the policy imder any circumstances. If the party
        claiming application of the doctrine acted on the basis ofa notification
        it should have known that such notification was liable to be amended       C
        or rescinded at any point of time, if the Government felt that it was
        necessary to do so in public interest."

      Applying the above tests to the facts of the present case, we find that
in the present case the doctrine of promissory estoppel had no application.
On balancing of equities we are of the view that OTC which is a public sector      D
undertaking had to act in public interest in the sense that had to keep the
transport service running for which they had to accommodate in-service
industrial workers which they could not have done if it had to sell the existing
service quarters to the retirees. In the circumstances, the Division Bench was
right in setting aside the decree passed by the learned Single Judge.
                                                                                   E
      We do not find any merit in the civil appeal and the same is accordingly
dismissed with no order as to costs.

A.KT.                                                       Appeal dismissed.