Holding

Allottees who bought plots from the Colonizer are entitled to the entire layout, the Colonizer's claim is contingent on payment of the outstanding licence renewal fee and related charges, DTCP will develop the project after 90% payment, density norms cannot be reduced, and the proceedings are a Special Committee, not arbitration.

Summary

The Okhla Enclave Plot Holders’ Welfare Association filed a writ petition alleging that the Colonizer (Durga Builders Pvt Ltd) failed to honour the terms of the plot‑allotment agreement and that many allottees had not paid the development charges required by the Supreme Court. The Court referred four questions to the appointed arbitrator concerning the Colonizer’s claim to land, the agency responsible for completing the colony’s development, the possibility of relaxing density norms, and whether the proceedings constituted arbitration. It held that the allottees who purchased plots from the Colonizer are entitled to the entire land as per the approved layout, and the Colonizer’s claim can be considered only after it pays the outstanding licence renewal fee of Rs 21.86 crore plus interest and the security expenses incurred by the DTCP. The Town and Country Planning Department (DTCP) will undertake the development once at least 90% of the total cost of Rs 128.70 crore is deposited by the eligible plot owners. The Court rejected any relaxation of the existing density norms and clarified that the proceedings are a Special Committee, not arbitration under the Arbitration and Conciliation Act, 1996. Consequently, the Court answered the arbitrator’s queries, ordered the apportionment of development charges among eligible allottees, and closed all pending applications.

Issues considered

The extent of land the Colonizer can claim succession over based on two of the seven licences.
Who will undertake the internal and external development of the colony and make plot allotments.
Whether the present density norms for the project can be relaxed.
Whether the proceedings before the arbitrator constitute arbitration under the Arbitration and Conciliation Act, 1996 or a Special Committee of the Supreme Court.

Legislation cited

Arbitration and Conciliation Act, 1996
Haryana Development and Regulation of Urban Areas Act, 1975s. Section 3, s. Section 5, s. Section 8

Subjects

urban developmentcolonizationplot allotmentlicence renewal feedevelopment chargesdensity normsspecial committeearbitrationSection 8 HDRA Actencroachment

Judgment

274 [2019]REPORTS
SUPREME COURT 13 S.C.R. 274 [2019] 13 S.C.R.

A OKHLA ENCLAVE PLOT HOLDERS’ WELFARE
ASSOCIATION
v.
UNION OF INDIA AND OTHERS

B (Writ Petition (C) No. 876 of 1996)
OCTOBER 03, 2019
[R. BANUMATHI AND A. S. BOPANNA, JJ.]
Urban development: Colonization – Writ petition by allottees
association alleging that respondent no.6-Colonizer did not adhere
C to the terms of the agreement in allotment of plots – Matter referred
to arbitration – Arbitrator identified the eligible allottees and sought
directions on four questions – First question was that in the light of
the fact that the Colonizer is claiming succession only with respect
to two licences (out of total seven licences) which portions of the
D land compositely held by seven licences falls to its share – Second
question is who will undertake the development of the Project and
subsequently make allotments – Third question is whether the present
density norms can be relaxed for the project and lastly direction
sought for converting these proceedings to that of a Special
Committee – Held: Members of the association/allottees purchased
E the plots from the Colonizer who held these seven licences and
therefore, they are entitled to the entire extent of land as per the
layout without going into the question of which is the portion of the
land the Colonizer is claiming succession – The claim of the Colonizer
could be considered by the arbitrator only if Colonizer pays the
licence renewal fee of Rs.21.89 crores and other amount spent by
F
DTCP, Haryana towards keeping watch and ward of the licensed
area and other charges – On such payment, the Colonizer and its
associate companies would be entitled to claim the surplus plots –
Secondly, the Town and Country Planning Department stated that
they will undertake the work after they are paid at least 90% of the
G total amount – A total amount of Rs.128.70 crores is payable by the
members of the petitioners’ association and eligible plot owners to
the DGTCP, Haryana for undertaking and completing the internal
and external development works – The Arbitrator would determine
the cost for the square meter and proportionately apportion the
total cost amongst the eligible plot owners depending on their
H
274
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 275
ASSOCIATION v. UNION OF INDIA

respective plot size – In case if any of the plot owner (who has A
already obtained the sale deed) does not pay the apportioned
external and internal development charges within the time frame,
the developments/amenities like sewerage, water connection,
electricity and other developments would not be extended to him –
In case the claimants who have not so far got the sale deed executed
express unwillingness to pay the proportionate/apportioned B
development charges or fail to give an undertaking within the given
time frame, the land allotted to them would revert to the Colonizer
on certain conditions – Insofar as the other categories of allottees
who have been identified and who are yet to get the sale deed, in
case if they do not pay the development charges within the time C
frame, their right over the plot would be forfeited – As regards the
question raised by the Arbitrator regarding relaxation of present
density norms for the project was concerned, the State of Haryana
submitted that the density norms like the area reserved for roads,
common purposes, etc. cannot be reduced – Thus, the Arbitrator
would be required to make appropriate adjustments of the plots in D
conformity with the existing rules from amongst the plot owners –
The State of Haryana shall render its co-operation in adjustment of
the plot sizes in the approved layout of course – Lastly, these
proceedings are in the nature of a Special Committee constituted
by this Court and not in the nature of arbitration within the meaning
of the Arbitration and Conciliation Act, 1996. E

CIVIL ORIGINAL JURISDICTION: Writ Petition (Civil) No.
876 of 1996. [Under article 32 of the Constitution of India]
Raju Ramachandran, Sr. Adv., Ms. Rashmi Nanda Kumar, Adv.
(A.Cs.) F
R. Basant, Maninder Singh, Sr. Advs. Shankar Narayanan,
Ms. Ayushma Awasthi, Piyush Sharma, Akshay Sahay, Dr. Monika
Gusain, Ms. Ashita Chawla, Kumar Parimal, B. K. Satija, Arvind Kumar
Sharma, B. V. Balaramdas, Satvik Varma, Mohit K. Mudgal, Akshay
Malpani, Ms. Shilpa Prakash, Himanshu Pal, Gaurav Kumar, Ayush
G
Sharma, Ranbir Singh Yadav, Puran Mal Saini, Vikrant Yadav, Ms. Anzu
K. Varkey, B. Rajesh, Ms. Sunita Singh Chauhan, Hitesh Kumar Sharma,
Bijender Singh Chaudhry, Shekhar Kumar, Ms. Sumita Hazarika, Suman
Lata Katiyar, Ms. N. Annapoorani, Anurag Jain, A. P. Jain, Shivam Garg,
Shiv Kumar Tiwari, Harshit Khanduja, Yash Pal Dhingra, Bimal Roy
Jad, Rahul Pandit, P. N. Puri, P. Narasimhan, E. C. Vidya Sagar, H
276 SUPREME COURT REPORTS [2019] 13 S.C.R.

A S. Rajappa, G. Ramakrishna Prasad, Amit Pawan, Sudarshan Rajan,
Md. Shahid Anwar, Chandra Bhushan Prasad, Arun K. Sinha, Mrs. Rani
Chhabra, Shailendra Bhardwaj, Dr. S. K. Verma, Ms. Jaspreet Gogia,
Ms. Puja Sharma, Ms. Sadhana Sandhu, P. Parmeswaran, Sanjay Jain,
Dinesh C. Pandey, Alok Kumar, Advs. for the appearing parties.
B The following Order of the Court was passed:
ORDER
Re: Directions sought for by the learned Arbitrator Justice
Vikramjit Sen, former Judge of the Supreme Court of India.
R. BANUMATHI, J.
C
1. The present dispute pertains to claim of number of allottees
who have not been allotted plots on land owned by respondent No.6-
Colonizer and not paid the amount to the Town and Country Planning for
internal and external development. As per respondent No.6-Colonizer,
in the year 1985, it purchased approximately 235 acres tract of land for
D the purpose of large-scale settlement in Section 91 of Faridabad-
Ballabgarh Complex, Haryana. At that time, there was no State policy in
place to regulate the colonization of land for settlement purposes.
Respondent No.6-Colonizer entered into agreement with number of
allottees who approached respondent No.6-Colonizer for the purpose of
E purchasing plots of land. In the year 1991, the State of Haryana enforced
its colonization policy and respondent No.6-Colonizer accordingly obtained
seven colonization licences. In the year 1996, writ petitions under Article
32 of the Constitution of India were filed by the members of the petitioner-
Association before the Supreme Court contending that respondent No.6-
Colonizer had not adhered to the terms of the agreement in allotment of
F plots to the allottees who had booked the plots with respondent No.6-
Colonizer. In the writ petition, number of orders came to be passed.
Vide order dated 02.12.1999, the Court noted that there seems to be a
dispute as to the amount payable by each allottee to respondent No.6-
Colonizer as well as to the government. Stating that it is not possible to
fix the exact figure payable by each allottee to the government and to
G respondent No.6-Colonizer, the Court directed each allottee to pay a
sum of Rs.50/- per sq. yd. towards development charges to the Director,
Town and Country Planning within four weeks. The balance amount, if
any, was to be worked out and fixed later.
2. Pursuant to the order dated 02.12.1999, the allottees are said to
H have deposited the amount with Director, Town and Country Planning,
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 277
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

Haryana (DTCP). Some of the allottees have not complied with the A
order of the Court by depositing the amount with DTCP. On 15.11.2013,
the Director, Town and Country Planning (DTCP) has filed affidavit to
the effect that whatever Internal Development Work has been done has
become defunct with passage of time. It was also submitted that an
estimate of the cost likely to be incurred on execution of remaining Internal
Development Work will have to be worked out afresh and will have to B
be borne by the plot holders or licensee. It was also categorically stated
that such cost cannot be borne by the government since public funds
cannot be diverted for this purpose.
3. The Court vide order dated 13.01.2015 appointed Mr. Raju
Ramachandran, senior advocate as amicus curiae to go into the detailed C
facts of the case and prepare a report. The Supreme Court vide order
dated 27.01.2016 referred the matter to arbitration. Justice Vikramajit
Sen, former Judge of the Supreme Court was appointed as the sole
Arbitrator for resolving the terms of reference and the dispute between
the parties. The learned Arbitrator held around twenty-two hearings in
D
the matter to resolve the dispute among the parties. The learned Arbitrator
has completed the mammoth task of identifying the eligible allottees.
The learned Arbitrator noted that there are three categories of allottees
for the purpose of allotment which are as under:-1
I. General
E
II. Economically Weaker Sections (EWS)
III. No profit no loss (NPNL)
4. The Scrutiny Committee consisting of Senior Town Planner,
Faridabad (Chairman), District Town Planner, Faridabad (Member),
Representative of Deputy Commissioner, Faridabad (Member), F
Representative of the Colonizer of Durga Builders Pvt. Ltd. (Member)
and representatives of concerned associations were appointed to identify
number of claimants in all the three abovementioned categories.
Accordingly, the Scrutiny Committee prepared its report wherein the
number of persons were identified as under:-
G
I. General …… 470 2
II. Economically
1 (Pg. No.44D and 55(4) of Proceedings of the Supreme Court dated 13.01.2015
and 27.01.2016 and Pg.20 of the paperbook regarding Letter dated 21.03.2018
by Arbitrator)
2 (Pg.5 of Scrutiny Committee Report qua EWS and General allottees) H
278 SUPREME COURT REPORTS [2019] 13 S.C.R.

A Weaker Sections (EWS) …… 350 (out of which
106 applied for
allotment)3
III. No profit, No loss (NPNL)…… 1932 4
5. As per the Scrutiny Committee Report, a total of 1928 claimants
B in the NPNL category were categorised in five categories as under:-
(i) First List - The claimants who have paid full land cost/
development charges before cut-off date.
(ii) Second List - The claimants who have paid full land cost
and part development charges before cut-off date.
C
(iii) Third List - The claimants who have paid full land cost only
and no development charges have been paid
(iv) Fourth List – The claimants who have paid part land cost
only and no development charges have been paid.
D (v) Fifth List – The claimants who could not produce any
evidence/documents with regard to booking of plot and
payment of development charge before cut-off date and
got executed sale deed from the developer directly or
through resale.5
E 6. After referring to the procedural order No.21 dated 31.08.2018,
the learned Arbitrator sought for direction on the following questions:-
(i) In light of the fact that Durga Builders Private Limited is
claiming succession only with respect to two licences (out
of total seven licences) making it necessary to also
F determine which portions of the land compositely held by
seven licences falls to its share?
(ii) Given that the State of Haryana has categorically stated
that it cannot take over the project and make allotments,
even in view of the fact that the Colonizer has intentionally
G not paid the Licence Fee, who will undertake the
development of the Project and subsequently make
allotments?

3 (Pg.6 of Scrutiny Committee Report qua EWS and General allottees)
4 (Pg.23 of Scrutiny Committee Report dated 28.10.2017)
5 (Pg.23-24 of Scrutiny Committee Report dated 28.10.2017)
H
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 279
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

(iii) In view of the fact that around 2690 claims were received A
in the NPNL category, the State of Haryana will have to
devise a policy for relaxing density norms for the Project.
(iv) The Hon’ble Supreme Court may pass appropriate directions
for converting these proceedings to that of a Special
Committee.6
B
7. By order dated 16.01.2019, we requested the learned senior
counsel Mr. Raju Ramachandran, learned amicus curiae to assist the
court in answering the directions sought for by the Arbitrator. Ms. Rashmi
Nandakumar, advocate was required to assist the learned amicus curiae.7
8. We have heard Ms. V. Mohana and Mr. Basant, learned senior
counsel appearing for the petitioner-Association, Mr. Maninder Singh, C
learned Senior counsel appearing for the State of Haryana along with
Ms. Monika Gusain, learned counsel, Mr. Satvik Varma, learned counsel
appearing for respondent No.6-Colonizer and all other parties at length
on various date of hearings.
9. In order to appreciate the contentions of the parties, on D
14.02.2019, we have directed the parties to submit their response on the
following details:-
(i) How much is the total extent of land procured by respondent
no.6-coloniser/developer, for the purpose of developing the
project in question. The details are to be furnished along
with the survey numbers/plot numbers of the land. It is also E
brought to our notice, a portion of the land is encroached by
the third parties. A rough sketch is to be supplied showing
the entire land of the project and the encroached area.
(ii) Respondent No.6-coloniser, as well as the learned counsel
for the State of Haryana, shall file the approved map/layout F
of the project. The map/layout shall show the position of
the plots and the actual physical features of the land as on
today.
(iii) What is the total amount of money collected by the 6th
respondent-coloniser from the plot owners towards the cost
of the land and also towards development charges, for G
internal and external.
(iv) What is the total amount of money actually deposited by
respondent no.6-coloniser before the competent authority,
6 (Pg.3-4 of Letter dated 11.10.2018 by the Arbitrator)
7 (Pg. No.62(2) of Proceedings of the Supreme Court dated 16.01.2019) H
280 SUPREME COURT REPORTS [2019] 13 S.C.R.

A for the purpose of internal and external development out of
the money collected from the plot owners.
(v) The total amount of money which has been paid by the plot
owners before the competent authority towards
development charges, pursuant to orders of this Court dated
07.04.1997 and 02.12.1999.
B
(vi) The estimate of the amount which is required to complete
the project in question including internal and external
development charges.
(vii) State of Haryana to file detailed report as to actual physical
features of the land including the extent of internal
C development and external development, if any, already done.
The State of Haryana shall obtain instructions and make
further submissions and/or suggestions with regard to the
development and other relevant issues for resolution of
dispute in question.8
D 10. In response to the above order, all concerned parties have
filed their responses and State of Haryana filed status affidavit. So far
as the licences granted to respondent No.6-Colonizer, the DTCP, Haryana
in its counter affidavit/Status Report stated as under:-
“Details of licences and layout – Phase I and Phase II 9
E That M/s Durga Builder Pvt. Ltd. and its associate companies
were granted the following licences, for a total area measuring
234.674 acres, under Section 3 of the Haryana Development and
Regulation of Urban Areas Act, 1975 (hereinafter called as Act
of 1975):-
Sl. Name of the Licencee Land Owner Licence No. Area
No. (in acres)
F 1. M/s Durga Builders M/s Durga Builders 1/91 and 65/92 114.075
(Main Developer) 6.19
2. Ravindra Promoters Ravinder Promoters 2/91 and 66/92 0.918
Pvt. Ltd. Pvt. Ltd. 1.82
3. Sh. Ravinder Kumar Sh. Ravinder Kumar 3/91 11.731
Nanda Nanda
4. Rajdhani Housing Rajdhani Housing 67/92 84.54
Syndicate Pvt. Ltd. Syndicate Pvt. Ltd.
G 5. Panchsheel Co- Panchsheel Co- 68/92 15.40
operative House operative House
Building Society Building Society
Total 234.674

8 (Pg. No.65(1-4) of Proceedings of the Supreme Court dated 14.02.2019)
H
9 (Para No.2 atPg. 3 of Status Affidavit filed by DTCP, Haryana on 07.03.2019)
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 281
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

11. The above said licensed areas are in two pockets i.e. Okhla A
Enclave Phase-I (Area 126.724 acres) and Okhla Enclave Phase-II
(Area 107.95 acres). Copy of the revised layout plan of Phase-I and
Phase-II, as revised and approved on 24.09.1997 have been filed by the
DTCP, Haryana. Out of the total extent of 234.674 acres, an extent of
46.85 acres is under encroachment and 187.825 acres land is available
B
for planning. In the report filed by the DTCP dated 19.08.2019, it is
stated that out of the above 187.825 acres area, 43.68 acres area was
reserved for general category plots, 23.475 acres area was reserved for
community-infrastructure sites. Balance, 120.67 acres was planned for
EWS and NPNL category plots.10 In this regard, reference be made to
layout plan of OKHLA Enclave, Phase-I, Delhi-Haryana Border, C
Faridabad and Layout plan, Phase-II, Sector-91, Faridabad, Haryana
filed by the DTCP. In the layout plans, alleged encroached areas are
also shown in red ink.
Question No.1: In light of the fact that Durga Builders
Private Limited is claiming succession only with respect to two D
licences (out of total seven licences) making it necessary to also
determine which portions of the land compositely held by seven
licences falls to its share?
12. Before we consider the claim of M/s Durga Builder Pvt. Ltd.,
it is necessary to point out that M/s Durga Builder Pvt. Ltd. had not E
renewed the licence by paying necessary fee. The above seven licences
i.e. licence Nos.1-3 of 1991, 65 of 1992 to 68 of 1992 were not renewed
after 1999. In its reply, the State of Haryana stated that an amount of
Rs.21,86,97,901/- is outstanding against the licence renewal fee. 11 This
amount is payable by the sixth respondent-Colonizer to DTCP, Haryana.
There are also other charges payable by the sixth respondent-Colonizer F
to the DTCP, Haryana. DTCP, Haryana has spent about Rs.1.25 crores
in keeping watch and ward over the property and this amount is also
payable by the sixth respondent. The claim of the sixth respondent-
colonizer could be considered only if respondent No.6-Colonizer pays
the licence renewal fee of Rs.21.89 crores and other amount spent by G
DTCP, Haryana towards keeping watch and ward of the licensed area
and other charges.

10 (Point No.5 at Pg.12 of Reply filed by DTCP, Haryana on 19.08.2019)
11 (Under Point No.1 at Pg. 2 of reply filed by DTCP, Haryana on 19.08.2019)
H
282 SUPREME COURT REPORTS [2019] 13 S.C.R.

A 13. Status of the Companies:- So far as the status of the above
companies, in its reply filed on 19.08.2019, the State of Haryana stated
as under:-
• That Sh. Ravinder Kumar Nanda and Smt. Promila Nanda
were the Directors of M/s Durga Builder Pvt. Ltd. (as
B per the information available on the website of Ministry of
Corporate Affairs, the status of the company is strike off), as
per the Memorandum of Article dated 29.01.1985. However,
Sh. Divij Mehra and Sh. Saurabh Kapoor are the present
Directors since 24.03.2014 and 15.04.2015 respectively.
C • That Sh. Ravinder Kumar Nanda and Smt. Promila Nanda
are the Directors of M/s Ravindra Promoters Pvt. Ltd.
since, 10.07.1989 (as per the information available on the
website of Ministry of Corporate Affairs, the status of the
company is strike off).
D • That Sh. Ravinder Kumar Nanda and Smt. Promila Nanda
are the Directors of M/s Rajdhani Housing Syndicate Pvt.
Ltd. since, 13.09.1989 and 22.12.1989 (as per the information
available on the website of Ministry of Corporate Affairs, the
status of the company is strike off).
E • That the information regarding the Directors of M/s
Panchsheel Co-operative House Building Society, is not
available on the website of MCA. 12
The DTCP, Haryana stated that there is no record available in the
office regarding change in the ownership of land of Sh. Ravinder Kumar
F Nanda bearing licence No.3 of 1991 to some other entity. Further, it is
stated that no representation regarding change of Directors of M/s Durga
Builder Pvt. Ltd. was received by the Director, Town and Country
Planning, Haryana up to 17.07.2014. 13
14. Issue of Ownership:- As per the report of Sh. H.P. Sharma,
G Court Commissioner, appointed by the Supreme Court, Sh. Arun Mehra
father of Sh. Divij Mehra, on behalf of M/s Hindustan Commercial
Investment Trust Ltd. and M/s Class Sales Pvt. Ltd. had filed claim for
87 plots (65 plots + 22 plots), which he claimed to have purchased from
12 (Under Point No.1 at Pg. No.3 of Reply filed by DTCP, Haryana on
19.08.2019)
H 13 (Under Point No.1 at Pg. 3-4 of reply filed by DTCP, Haryana on 19.08.2019)
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 283
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

M/s Durga Builder Pvt. Ltd. This claim of plots was rejected by Court A
Commissioner.14 Sh. Arun Mehra filed an application of impleadment in
WP(C) No.113 of 1996 in the Supreme Court on behalf of M/s Rajdhani
Housing Syndicate Pvt. Ltd. in January, 2014. In its reply, the State of
Haryana has stated that it has received an e-mail dated 18.07.2014 from
Advocate Deepak Khosla mentioning that as per the decision of the
Company Law Board dated 11.03.2014, Sh. Arun Mehra and Sh. Divij B
Mehra are the present Directors of M/s Durga Builder Pvt. Ltd. It is
stated that one Sh. R.K. Nanda claims to have become the Director of
M/s Durga Builder Pvt. Ltd. who attended the proceedings before the
Director General, Town and Country Planning, Haryana at Chandigarh
as Director of M/s Durga Builder Pvt. Ltd. It was submitted that by the C
Gazette Notification dated 24.09.2018, the name of M/s Durga Builder
Pvt. Ltd. has been struck off from the Registrar of Companies and
dissolved by the Government of India, Ministry of Company Affairs,
New Delhi. On behalf of the Colonizer, an order dated 24.01.2019 passed
by the National Company Law Tribunal has been produced to show that
in the Gazette Notification dated 24.08.2018 qua M/s Durga Builder D
Pvt. Ltd. has been kept in abeyance. 15
15. Stand of the Sixth Respondent-M/s Durga Builder Pvt.
Ltd. – The Colonizer:- Though the present sixth respondent-M/s Durga
Builder Pvt. Ltd.-Colonizer claims that all assets of the Company M/s
Durga Builder Pvt. Ltd. were purchased by Mr. Arun Mehra from Sh. E
R.K. Nanda, the same could not be verified. Members of the petitioner
association/allottees purchased the plots from the Colonizer who held
the above seven licences and therefore, they are entitled to the entire
extent of land as per the layout without going into the question of which
is the portion of the land M/s Durga Builder Pvt. Ltd. is claiming
succession. As per the report of Sh. H.P. Sharma, Court Commissioner, F
appointed by the Supreme Court, Sh. Arun Mehra father of Sh. Divij
Mehra, on behalf of M/s Hindustan Commercial Investment Trust Ltd.
and M/s Class Sales Pvt. Ltd. had filed claim for 87 plots (65 plots + 22
plots), which he claimed to have purchased from M/s Durga Builder
Pvt. Ltd. This claim of plots was rejected by Court Commissioner. G
16. The learned amicus curiae submitted that as per the affidavit
dated 19.08.2019 filed by DTCP, Haryana and e-mail dated 18.07.2014
Pg.No.4 of the reply dated 19.08.2019 filed by DTCP, Haryana
14

(Under Point No.1 at Pg. No.4-5 of Reply filed by DTCP, Haryana on
15

19.08.2019) H
284 SUPREME COURT REPORTS [2019] 13 S.C.R.

A received by the Department from the advocate Deepak Khosla mentioning
that as per the decision of the Company Law Board dated 11.03.2014,
Mr. Arun Mehra and Divij Mehra are the present Directors of M/s Durga
Builders Pvt. Ltd. The learned amicus submitted that when Mr. Arun
Mehra is claiming to be the Director of M/s Durga Builders Pvt. Ltd. of
which he is a Director, the claim of Mr. Arun Mehra need not be considered
B as it has been rejected by the Court Commissioner. So far as the claim
of Mr. Arun Mehra in respect of 87 plots, liberty is granted to Mr. Arun
Mehra to work out his remedy in accordance with law by agitating the
matter before the competent court. However, it is made clear that the
claim of Mr. Arun Mehra in respect of 87 plots shall not come in the way
C of the claim of the beneficiaries identified by the Scrutiny Committee.
17. Though the Commissioner rejected the claim of the sixth
respondent-Colonizer, the correctness of the same shall be examined
with reference to documents. The area claimed by the Colonizer can be
considered by the arbitrator by considering the layout plan now produced
by DTCP, Haryana.
D
18. The claim of the sixth respondent can be considered by the
arbitrator only subject to the condition that he is paying the licence renewal
fee of Rs.21,86,97,901/- (as on 28.02.2019) payable with interest @ 6%
from 28.02.2019 plus Rs.1.25 crores borne by DTCP, Haryana in
maintaining the security as per the order of the Court dated 18.07.2013.
E The area claimed by the sixth respondent-Colonizer shall be considered
by the learned arbitrator only after examining by the rightful claim of the
beneficiaries identified by Scrutiny Committee (to be finalised and
approved by the learned arbitrator).
Question No.2: Given that the State of Haryana has
F categorically stated that it cannot take over the Project and make
allotments, even in view of the fact that the Colonizer has
intentionally not paid the License Fee, who will undertake the
development of the Project and subsequently make allotments?
19. In terms of Section 5 of the Haryana Development and
G Regulation of Urban Areas Act, 1975, the Colonizer shall deposit 30%
of the amount realised from time to time from the plot holders within a
period of ten days of its realisation in a separate account to be maintained
in a scheduled bank. That amount shall only be utilised by him towards
meeting the cost of internal development works in the colony. The
remaining amount shall be deemed to have been retained by the Colonizer
H
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 285
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

inter alia to meet the cost of land and external development works. In A
the present case, the Colonizer has not complied with the requirement
under Section 5 of the said Act. In the reply filed by the Director, Town
and Country Planning, Haryana (on 19.08.2019), it is stated that the
licencee M/s Durga Builder Pvt. Ltd. has not complied with Rules 24,
26(2), 27 and 28 of Haryana Development and Regulation of Urban
Areas Rules, 1976, as per which the licencee shall have to maintain B
separate ledger account of each plot holder, intimate the account number
and full particulars of the scheduled bank wherein he deposits 50% of
the amount realised by him from the plot holders for meeting the cost of
internal development works.16
20. Vide order dated 07.04.1997 on the question of the cost of C
land, the court noted that as far as the cost of the land is concerned, the
Colonizer has agreed to abide by the rate which it contracted for, namely
Rs. 100/- to Rs. 200/- per square yard depending upon the size of the
plots. As far as the development charges are concerned, the court noted
that the parties are governed by the orders of the Department. As regards
D
the internal development charges, the court in its order dated 07.04.1997
noted that the Government has fixed Rs. 878/- for the plots of the size
135 sq. yards to 170 sq. yards and Rs. 975/- for plots of 171 to 220 sq.
yards. As to the external development, it was worked out at Rs. 4,70,000/
- per acre which was to be borne by the allottees. 17 However, it is stated
only some of the allottees (according to the Colonizer, only 143 of the E
allottees) have complied with the order of the Supreme Court. But
according to the petitioners that in compliance of the order of the Supreme
Court, they have paid the amount. This has to be verified; those of them
who have not complied with the order of the Supreme Court shall be
directed to pay the amount with 6% interest on the amount payable from
01.01.1998. F
21. Vide order dated 02.12.1999, the court observed that it is
not possible to fix the exact figure payable by each allottee to the
Government and to the Colonizer. All the same, the court directed each
allottee to pay a sum of Rs. 50/- per square yard within four weeks from
the date of this order to the Government of Haryana in the account of G
the Colonizer. The court directed that the balance amount if any, payable
by each allottee will be worked out and fixed up later. To avoid further

16 (Point No.2 at Pg. 6-7 of Reply filed by DTCP, Haryana on 19.08.2019)
17 (Para No.8 of Proceedings of the Supreme Court dated 07.04.1997) H
286 SUPREME COURT REPORTS [2019] 13 S.C.R.

A complications, the court directed the allottees to send the amount by
draft by registered post to the Director, Town and Country Planning, if
personal delivery is not feasible. The remittance of the amount was
directed to be immediately sent to respondent No.6 by the remitter. 18
However, it is stated that only some of the allottees (according to Colonizer,
only 143 of the allottees) have complied with the order of the Supreme
B
Court.
22. Submissions on behalf of Respondent No.6-Colonizer:-
It has been submitted by respondent No. 6 that the rate for development
stood at Rs. 550/- per sq. yard plus the cost of land in the year 1995. The
Supreme Court revised these charges upwards vide its orders dated
C 07.04.1997 and 02.12.1999. A complete scrutiny of all the claims has
revealed that out of the eligible 1708 NPNL claimants in the scrutiny
committee report, only 143 have paid development charges @ Rs. 600/
-, in compliance of order dated 02.12.1999 passed by this court; the rest
1565 have failed to comply with the said order and have shied away
D from paying the requisite development charges, thereby being no longer
entitled for allotment of a plot. Further, according to respondent No.6,
many plot claimants have also defaulted in making payment of cost of
land as stipulated by order dated 07.04.1997. According to respondent
No.6-Colonizer, the petitioners falling short on the land and development
charges have jeopardised the development of plots allotted to them. 19
E
23. Submissions on behalf of the Petitioners:-On the other
hand, the petitioners contend that it has been falsely alleged by the builder-
respondent No.6 that the petitioners have not paid the amount as directed
by this Court vide orders dated 07.04.1997 and 02.12.1999. It has been
submitted by the petitioners that they have deposited the amount with
F the DTCP, Haryana. The petitioners averred that they are ready to
deposit the amount whatever is the amount now payable for internal and
external development as estimated by the Government of Haryana. 20
24. The petitioners further submitted that the cost of internal
development of the land is inclusive of the land cost. As such, the
G petitioners have already made the agreed payment of internal and external
development charges. It has been claimed by respondent No. 6 that it
18 (Para No.1 of Proceedings of the Supreme Court dated 02.12.1999)
19 (Point No.6 atPg. 4 of submission on behalf of R-6 filed on 22.07.2019)
20 (Para No.4 atPg. 1 of submission on behalf of petitioners filed on 13.03.2019

H in terms of order dated 14.02.2019).
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 287
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

has deposited a total amount of Rs. 18.90 crores with the Government A
for external development charges out of which only a sum of Rs. 2.30
crores has been spent by the DTCP, Haryana. This fact has also been
admitted by the Government of Haryana/Town and Country Planning in
their affidavit dated 09.09.2008. According to the petitioners, there is
still a sum of Rs. 16.70 crores lying with the Government. However, it B
has been stated by the petitioners that whatever amount is due and payable
to DTCP, Haryana towards internal and external development charges,
they are ready and willing to deposit the said amount as is estimated by
the Govt. of Haryana.21
25. In the light of our direction dated 14.02.2019, the Director, C
Town and Country Planning, Haryana has filed status affidavit containing
the details as to (i) amount so far deposited towards the external
development charges; (ii) estimate of the internal and external
development works and other details.
26. Stand of Director, Town and Country Planning:- The D
State of Haryana has filed detailed status report stating that an amount
of Rs.19,76,69,127/- has been deposited with the Department towards
the external development charges:-Rs.17,17,72,000/- by the Colonizer +
Rs.1,75,00,000/- by the petitioners). The DTCP has stated that respondent
No.6, in the written submission dated 22.07.2019 stated that they have
collected Rs.15,79,90,433/- from “No Profit, No Loss” and “General E
Category” plot claimants and further submitted that the DTCP, Haryana
has spent Rs.8,60,00,000/- on the internal development works and
deposited Rs.17,17,00,000/- with the State of Haryana for external
development works. The State of Haryana has also taken the stand that
in response to the show cause notice dated 23.04.2013 issued by the F
Department to M/s Durga Builder Pvt. Ltd. and its associate companies,
reply dated 25.06.2013 signed by Sh. Ravinder Kumar Nanda was filed
stating that M/s Durga Builder Pvt. Ltd. has collected Rs.28,13,91,183/
- i.e. Rs.17,00,99,128/- in Phase-I and Rs.11,12,92,055/- in Phase-II
and spent Rs.21.39 crores on the internal development works. According
G
to the State of Haryana, the stand of DBPL is totally contradictory to its
stand taken in the written submission filed in the court. 22

21 (Point No. (V) atPg. 15-16 of submission on behalf of petitioners filed on
13.03.2019 in terms of order dated 14.02.2019)
22 (Under Point No.2 at Pg.7-8 of Reply filed by DTCP, Haryana on 19.08.2019)
H
288 SUPREME COURT REPORTS [2019] 13 S.C.R.

A 27. Amount so far deposited towards external development
charges:- So far as the amount deposited towards External Development
Charges, in the Status Report, the State of Haryana has stated as under:-
“That, as per the terms and conditions of the licence, the internal
development works are to be executed by the colonizer, so no
B amount on account of Internal Development Charges has been
deposited by the colonizer to the Department. It is further submitted
that the colonizer has deposited Rs.17.17 crores. That as per order
of this Hon’ble Court dated 07.04.1997 and 02.12.1999, the
petitioners have deposited a total sum of Rs.1.75 crores @
Rs.50/- per sq. yd. with the Department which has adjusted by
C the Department against outstanding dues of external development
charges.
Sl. No. Detail of External Development Total amount
Charges deposited
(in Rs.)
D 1. Deposited by the licencee 17,17,72,000/-
2. Deposited by the petitioners directly in the 1,75,00,000/-
Department
Total 19,76,69,127/-

However, it is submitted that an amount of Rs.37.739 crores is
E outstanding against External Development Charges. As per rough
estimate given by the Superintending Engineer, HSVP Circle, Faridabad,
about Rs.47.00 crores would be required for completion of the external
development works around the colony area and connecting the services
with the internal works to be executed in the colony. 23
28. Estimate of the Internal Development Works:- So far
F
as the internal development works in the licensed colony, the DTCP in
the status report has stated as under:-
“That the Department requested Haryana Shahari Vikas
Pradhikaran to give estimate against internal development works
in the licenced colony. As per information supplied by the
G Superintending Engineer, HSVP Circle, Faridabad vide letter dated
01.03.2019 (Annexure-VI), rough cost estimate for execution of
the internal development works in the above said colony would be
as under:-
(Para No.2 at Pg.4-6 of Status Affidavit filed by DTCP, Haryana filed on
23

H 07.03.2019)
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 289
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

(a) Approximately Rs.17 crores would be required for A
providing internal water supply, sewerage, storm water
drainage and construction of roads (balance work) of Okhla
Enclave, Phase-II, Sector 91, Faridabad.
(b) Approximately Rs.22.10 crores would be required for
providing internal water supply, sewerage, storm water B
drainage and construction of roads (balance work) of Okhla
Enclave, Phase-I, Sector 91, Faridabad.
(c) Approximately Rs.20.86 crores would be required for
providing storm water drainage for Phase-I and II.
C
(d) Approximately Rs.3.98 crores would be required for
laying of RCC pipe and construction of disposal (sewer).
This is in addition to expenditure of Rs.1.92 crores
incurred till date.
(e) Approximately Rs.5.09 crores would be required for
D
providing electrification and street light. 24
Thus, total amount of Rs.70.00 crores would be required to
complete the internal development works in the colony. 25
29. Estimate of the External Development Works:- For
execution of the external development works, Superintending Engineer, E
HSVP Circle, Faridabad has informed that approximately Rs. 8.00
crores have already been spent on External Development works of the
licensed area. As per rough cost estimates given by the Superintending
Engineer, HSVP Circle, Faridabad about Rs.47.00 crores would be
required for completion of the external development works around the F
licensed colony area and connecting the services with the internal
development works to be executed in the colony. Thus, a total amount of
Rs.117,00,00,000/- (Rs.70,00,00,000/- Plus Rs.47,00,00,000/-) is required
for the internal development and external development works. 26
30. So far as the actual physical features including the extent of G
internal development and external development works executed, the
Status Report states as under:-

24 (Para No.2 at Pg.5 of Status Affidavit filed by DTCP, Haryana on 07.03.2019)
25 (Para No.2 at Pg.6 of Status Affidavit filed by DTCP, Haryana on 07.03.2019)
26 (Para No.2 atPg. 6 of Status Affidavit filed by DTCP, Haryana on 07.03.2019)
H
290 SUPREME COURT REPORTS [2019] 13 S.C.R.

A “Regarding external development it is submitted that it includes
city level infrastructure such as master plan roads, hospital, college,
public health services etc. which are executed as per the provision
of Development Plan. As per Superintendent Engineer, Haryana
Shahari Vikash Pradhikaran (HSVP), master sewer line from
Durga Builder to Palla Chowk, road from bye-pass to Okhla
B Enclave, connecting sewer of Okhla Enclave disposal have already
been executed and the work of master water supply is being
undertaken.”27
So far as existing water supply (shown in green colour) and existing
sewerage lines (shown in red colour), reference be made to the layout
C plans of OKHLA Phase-I at Delhi-Haryana Border, Faridabad filed by
the State of Haryana along with its status report dated 07.03.2019.
31. As discussed above, a total of Rs.117,00,00,000/- is required
for completion of internal and external development works. Since the
completion of internal and external development works would take some
D time, suitable provision has to be made for increase in cost of internal
and external development works and other incidental expenses. In our
view, in addition to Rs.117,00,00,000/- (Rs.70,00,00,000/-plus
Rs.47,00,00,000/-) for internal and external development works, another
10% i.e. Rs.11,70,00,000/- is to be added to the total cost of internal and
external development works. Thus, the amount of Rs.128,70,00,000/-
E (Rs.117,00,00,000/- + Rs.11,70,00,000/-) is payable to the Director
General, Town and Country Planning (DGTCP), Haryana for undertaking
and completing the internal and external development works. Mr.
Maninder Singh, learned Senior counsel appearing for the Director, Town
and Country Planning, Haryana submitted that at least 90% of the amount
F has to be deposited to enable the Department to undertake the works.
The question is as to how this amount is to be paid to DTCP, Haryana.
32. Apportionment of the total cost for internal and external
development charges:- The learned senior counsel appearing for the
petitioners submitted that the members of the petitioner association are
ready to proportionately bear the cost of the internal and external
G
development works. Taking the total amount as Rs. 128,70,00,000/- and
the total extent of area to be allotted to the eligible allottees, the Arbitrator
shall determine the cost for the square meter and proportionately apportion
the total cost amongst the eligible plot owners. Each one of the eligible
(Para No.2 atPg. 6 of Status Affidavit filed by DTCP, Haryana dated
27

H 07.03.2019)
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 291
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

plot owners shall file individual affidavit undertaking to make the payment A
before the DTCP within the time frame fixed by the Arbitrator. If the
proportionate amount so apportioned to the individual plot owners is not
paid within the stipulated time frame, they shall forfeit the right over the
plot. The format of the affidavit shall be finalised by the learned Arbitrator.
In case if any of the eligible allottees are having difficulty in paying the
amount, two or three eligible allottees are at liberty to join together B
depending upon the size of the plot and pay the development charges
and share their proportionate right over the plot. It is made clear that the
payment of the development charges will have to be time bound and in
case, the amount is not paid within the time bound, the said allottee shall
forfeit the right for the plot. C
33. From out of the above amount of Rs.1,28,70,00,000/-, Rs.70
lakhs to be kept apart to enable the Director, Town and Country Planning,
Haryana to adjust the expenditure so far borne by DTCP in issuing various
advertisements and other such incidental expenses. The details of such
expenditure so far made by DTCP along with necessary bills/vouchers
D
be produced before the learned Arbitrator and the learned Arbitrator to
pass appropriate orders for adjustment of the expenditure amount so far
borne by DTCP, Haryana.
34. On behalf of the petitioners, it was stated that the General
Secretary of petitioners’ association has been duly authorised by its
members in the general meeting held on 15.09.2019 to state that its E
members shall pay the development charges within the stipulated time
frame fixed by the State of Haryana. In the response filed by the
petitioners’ association, it is stated that in case if any plot holder does not
pay the amount on demand by DTCP, Haryana within the stipulated
time frame, the plot holder may be levied interest at the rate of 18% by F
giving one more opportunity to the plot holder for payment. The request
for one more opportunity to deposit the apportioned amount payable
cannot be accepted since the matter is pending for more than two decades.
The payment of apportioned amount should be a time bound one. In
case if any of the plot owner (who has already obtained the sale deed)
does not pay the apportioned external and internal development charges G
within the time frame, the developments/amenities like sewerage, water
connection, electricity and other developments shall not be extended to
him.
35. The learned Senior counsel Mr. R. Basant repeatedly submitted
that as many as about 450 members of petitioners’ association have H
292 SUPREME COURT REPORTS [2019] 13 S.C.R.

A obtained the sale deed and they would definitely pay the apportioned
development charges. Since there are number of beneficiaries, it is
necessary to clarify the consequence if the claimants do not pay the
amount stipulated within the prescribed time frame. In case the
claimants express unwillingness to pay the proportionate development
charges or fail to give an undertaking within the given time frame, the
B land allotted to them will revert to the Colonizer on certain conditions
viz. – colonizer will pay the claimant the amount paid towards the cost
of land with interest from the date on which such payment was made at
a rate which may be considered appropriate by the arbitrator. The
Colonizer in addition to the above, shall also pay the proportionate amount
C towards development works payable for the said plot to the government
of Haryana. On the order passed by the arbitrator, such payment shall
be made within six weeks from the date of failure of payment by the
claimant.
36. Insofar as the other categories of allottees who have not been
identified and who are yet to have the sale deed, in case if they do not
D
pay the development charges within the time frame, as discussed earlier,
they shall forfeit the right over the plot. The Colonizer has undertaken to
refund the amount to the allottees in case of failure to pay the apportioned
amount by the individual plot owners. The Colonizer has also undertaken
to refund the amount to the allottees who cannot pay the due amount to
E DTCP, Haryana. In case of the plot owner who cannot pay the
apportioned development charges or committed default in payment of
the apportioned amount, the colonizer shall pay the consideration amount
paid by the allottee along with the reasonable interest. Additionally, the
Colonizer shall also pay the apportioned amount of the development
charges qua those plots.
F
37. Number of claimants settled by the Scrutiny Committee
appointed by the learned Arbitrator – Report signed by all the
parties:- Shri H.P. Sharma, Court Commissioner was appointed by the
Supreme Court vide order dated 21.10.2008. As per order dated
18.07.2013 of the Supreme Court, it was directed that fresh exercise to
G prepare a final list of claimants be undertaken by the Director General,
Town and Country Planning. This was accordingly done and 3002 eligible
plot holders were identified. This information was submitted to the
Supreme Court through affidavit dated 15.11.2013. The Arbitrator vide
order dated 07.05.2016 set the following conditions to determine the
entitlement of each plot holder:-
H
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 293
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

a) Plot holders should have made bookings alongwith entire A
payments towards cost of land prior to 07.04.1997.
b) Such plot holders should have paid/deposited the entire
development charges with the Haryana Government upto
31.12.1999, in terms of the order of the Supreme Court dated
02.12.1999. B
c) The plot holders who have made bookings alongwith the entire
payment towards cost of land prior to 07.04.1997 but had not
made payments towards the development charges in terms of
the order of the Supreme Court dated 02.12.1999, can be
considered provided they are willing to pay the development C
charges as would be required on the date of carrying out the
actual development.
d) Multiplicity and duplicity of claims, i.e. more than one claim
from one family will not be considered as eligible. Further, if
any person is already in occupation of a plot illegally or by
encroachment, he will similarly not be considered for any further D
allotment.28
38. The exercise of deciding eligible candidates was started with
the NPNL category. The Director, Town and Country Planning, Haryana
issued a public notice on 18.08.2016 in the newspaper inviting applications
to file claims accompanied with supporting documents regarding E
allotment/booking of plot in NPNL category. The Scrutiny Committee
decided that an amount of Rs. 550/- be taken as development charge for
scrutiny of claims.29 The Scrutiny Committee received 2690 applications
for the purpose of scrutiny before the cut-off date. However, 523
applicants did not appear before the Committee for the purpose of
F
scrutiny. After scrutiny of applications, the Committee found total 1932
NPNL category applicants, 73 general category applicants, 165
commercial category applicants and 2 EWS category applicants. 30
39. NPNL Category were divided into five categories as under31:-
Those who have paid full land cost/ G
development charges before cut-off date …… 1155
28 (Para Nos.3-5 of the Order dated 07.05.2016 of Arbitrator)
29 (Under Point No.6 at Pg 4 of submission of R6 dated 22.07.2019).
30 (Pg 23 of vol. 1 of scrutiny committee report dated 28.10.2017)

31 (Under Point No.3 at Pg.9 of the Reply filed by DTCP, Haryana on

19.08.2019) H
294 SUPREME COURT REPORTS [2019] 13 S.C.R.

A Those who have paid full land cost and
part development charges before cut-off date …… 457
Those who have paid full land cost only and
no development charges …… 86
B Those who have paid part land cost only and
no development charges …… 17
Those who got sale deed executed directly from
developer or through re-sale …… 220
40. Thereafter, scrutiny qua general and EWS category claimants
C
was started. Vide order No.20 dated 13.07.2018, the Arbitrator directed
the State to again give state-level advertisements inviting representation
from all parties alongwith documents supporting their allotment in General
and EWS category by 31.07.2018. The cut-off date for submitting
application/claims was four weeks from the date of advertisement. In
D compliance of this order, public notice was advertised on 04.08.2018 in
Amar Ujala, Dainik Jagran (Hindi) and Tribune (English). The last date
for receipt of application was 03.09.2018 but since 03.09.2018 being a
gazetted holiday, the applications received upto 04.09.2018 were
considered by the Committee.32 Under the EWS category, draw was
E held on 30.07.1994 and 18.11.1995 where 350 persons were successful.
Only 106 applicants applied for allotment.33
41. General Category:- During scrutiny of documents, it was
observed that in the general category plots where Builder Buyer
Agreement has been executed, the rate for plot size more than 263 sq.
F yards had been fixed @ 425 per sq. yards. Following categorisations
were made with respect to general category claimants 34:-
Claimants who paid land cost @ 425 with …… 52
development charge at the rate of 550 per
G sq. yard
Claimants who paid part land cost/development …… 16
charge
32 (Pg 3 of scrutiny committee report qua general and EWS category).
33 (Pg.6 of scrutiny committee report qua general and EWS category).
34 (Pg.5 of scrutiny committee report qua general and EWS category)
H
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 295
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

Claimants who could not produce any evidence …… 402 A
/documents with regard to booking/payment of
development charge before cut-off date and
got sale deed/conveyance deed executed from
developer B
Note:- The report of the general category plots was not signed
by Sh. Ashok Aggarwal, the authorised representative of Durga General
Plot Holders Welfare Association as he was not satisfied with the scrutiny
procedure/comments of the scrutiny committee. 35
Note:- In above 402 cases, 86 numbers of cases are claimed by C
M/s Hindustan Commercial Investment Trust & M/s Class Sales Pvt.
Ltd., wherein the Directors are Sh. Divij Mehra etc. only who are now
claiming to be the Director of M/s Durga Builder Pvt. Ltd. in the Supreme
Court.36
D
42. The Scrutiny Committee consisting of Senior Town Planners
and others have thus identified the number of eligible plot owners. The
number of eligible allottees have to be decided by the Arbitrator applying
the parameters as set out in the order of the Arbitrator dated 07.05.2016
and the learned Arbitrator to determine the final list of eligible plot owners
in all the categories – NPNL, Economic Weaker Sections (EWS) and E
General and also commercial.
43. Once the number of allottees are identified, as discussed earlier,
the amount of internal and external development cost has to be
proportionately apportioned amongst each one of the eligible allottees.
F
It is seen from the Scrutiny Committee Report and the status report filed
by the State of Haryana, about 452 plot owners have got the sale deed
from the Colonizer; some of the allottees are yet to get the sale deed.
Section 8 of the Haryana Development and Regulation Urban Areas
Act, 1975 (HDRA Act) inter alia provides for cancellation of licences if
the Colonizer contravenes any of the conditions of the licence or the G
provisions of the HDRA Act and also provides for mode of carrying out
35 (Under Point No.3 at Pg.10 of the Reply filed by DTCP, Haryana on
19.08.2019)
36 (Under Point No.3 at Pg.10 of the Reply filed by DTCP, Haryana on

19.08.2019) H
296 SUPREME COURT REPORTS [2019] 13 S.C.R.

A the development works in the colony. Section 8(4) of the HDRA Act
enables the Director to transfer the possession and title of the land to the
plot owners. Section 8 (4) of the HDRA Act reads as under:-
“8. Cancellation of licence –
…….
B
(4) Notwithstanding anything contained in this Act, after the colony
has been fully developed under sub-section (2), the Director may
with a view to enabling the colonizer, to transfer the possession of
and the title to the land to the plot-holders within a specified time,
authorise the colonizer by an order, to receive the balance amount,
C
if any, due from the plot-holders, after adjustment of the amount
which may have been recovered by the Director towards the
cost of the development works and also transfer the possession
of or the title to the land to the plot-holders within aforesaid time.
If the colonizer fails to do so, the Director shall on behalf of the
D colonizer transfer the possession of and the title to the land to the
plot-holders on receipt of the amount which was due from them.
…….”
Once the allottees are identified and the allottees pay the
apportioned development charges, the learned Arbitrator shall direct the
E Director to execute necessary documents in favour of the allottees in
terms of Section 8(4) of the HDRA Act.
Question No.3:- In view of the fact that around 2690 claims
were received in the NPNL category, the State of Haryana will
have to devise a policy for relaxing density norms for the Project.
F
44. Out of the total 234.675 acres licensed land under seven
licences, 46.85 acres land is under encroachment/unauthorised
construction and 187.825 acres land is stated to be available for planning.
In the report filed by the DTCP, Haryana dated 19.08.2019, it is stated
that out of the above 187.825 acres area, 43.68 acres area was reserved
G for general category plots, 23.475 acres area was reserved for
community/infrastructure sites. Balance, 120.67 acres was planned for
EWS and NPNL category plots. As per the layout plan of Phase-I and
Phase-II, details of the plots like category, plot area and the number of
plots are as under:-
H
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 297
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

Phase-I A
Total – 1502 plots * 37

Sl. Size of the Plot Number of Category Total
No. Plots (category
wise)
1. 200 sq. Mtrs 272 plots Category D – reserved for NPNL
2. 148.75 sq. Mtrs 155 plots Category E – reserved for NPNL 427 plots
B
3. 101.25 sq. Mtrs 163 plots Category F – reserved for EWS
4. 50 sq. Mtrs 255 plots Category G – reserved for EWS
5. 112 sq. Mtrs 328 plots Category H – reserved for EWS 746 plots
6. 420 sq. Mtrs 101 plots Category A – reserved for General
7. 350 sq. Mtrs 78 plots Category B – reserved for General 329 plots
8. 242 sq. Mtrs 150 plots Category C – reserved for General C

Phase-II
Total – 1424 plots*38
Sl. No. Size of the Plot Number of Category Total
Plots (Category D
wise)
1. 200 sq. Mtrs 163 plots NPNL
2. 148.75 sq. Mtrs 176 plots NPNL 356 plo ts
3. 128 sq. Mtrs 17 plots NPNL
4. 101.25 sq. Mtrs 425 plots EWS
5. 50 sq. Mtrs 268 plots EWS 857 plo ts
E
6. 112 sq. Mtrs 164 plots EWS
7. 420 sq. Mtrs 96 plots General
8. 350 sq. Mtrs 24 plots General 211 plo ts
9. 242 sq. Mtrs 91 plots General
F
45. On behalf of the Director, Town and Country Planning,
Haryana, it is stated that as per the revised layout plan of Phase-I and
Phase-II, the plotted area shall not exceed 55% of the net planned area
of the colony. The commercial area shall also be included in this plotted
area for calculations of the area under the plots. In Phase-I, the total G
area under the scheme is 126.724 acres out of which the area under the

37 Revised lay-out plan submitted by DTCP, Haryana in its status affidavit
dated 07.03.2019 at Pg. 26.
38 Revised lay-out plan submitted by the DTCP, Haryana in its status affidavit

dated 07.03.2019 at Pg. 27. H
298 SUPREME COURT REPORTS [2019] 13 S.C.R.

A residential plot is 61.64 acres. In Phase-II, the total area under the scheme
is 107.95 acres out of which 51.03 acres is the area in residential plots.* 39
46. Insofar as the question raised by the learned Arbitrator that
whether the present density norms can be relaxed for the project, Mr.
Maninder Singh, learned Senior counsel appearing for the State of
B Haryana has submitted that the density norms like the area reserved for
roads, common purposes, etc. cannot be reduced. Insofar as the density
of the plots, the learned Arbitrator if need be, shall make appropriate
adjustments of the plots in conformity with the existing rules. The
adjustments of the plot area will have to be done from amongst the plot
owners. The State of Haryana shall render its co-operation in adjustment
C of the plot sizes in the approved layout of course, subject to the conformity
with the existing rules and governing sanction of the scheme.
Licence fee payable by the Colonizer, issue of
encroachment and the expenses met by the Director, Town and
Country Planning, Haryana in engaging the watch and ward of
D the licensed area and other issues.
47. Licence fee:- As discussed earlier, seven licences were issued
to M/s Durga Builders Private Limited and its associate companies for
the total area measuring 234.674 acres under Section 3 of the Haryana
Development and Regulation of Urban Areas Act, 1975 (HD&RUA
E Act). The above said licensed areas are in two pockets i.e. as Okhla
Enclave Phase-I (Area 126.724 acres) and Okhla Enclave Phase-II
(Area 107.95 acres). The copies of the approved layout plans of Okhla
Enclave Phase-I and Phase-II are revised on 24.09.1997. In terms of
the provisions of the Act and as per the conditions of the licence, the
Colonizer has to pay the licence fee and the licence renewal fee. In the
F status affidavit filed by the Director, Town and Country Planning, Haryana
in March, 2019, it is stated that an amount of Rs.21,86,97,901/- (as on
28.02.2019) is outstanding from the Colonizer. As per the terms and the
conditions of the licence, the Colonizer/Developer is bound to bear the
expenses to carry out the internal development works in the colony and
to clear the government dues of fee for renewal of licence and other
G
expenses borne by the State of Haryana. However, with a view to move
forward with the development, the allottees of the plots have undertaken
to pay the cost of the internal and the external developments. But the
Colonizer cannot be allowed to go scot free. The sixth respondent-
Under Point No.2 at Pg. 3 in the status affidavit filed by DTCP, Haryana
39

H dated 07.03.2019.
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 299
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

Colonizer is bound to pay the licence fee of Rs. 21,86,97,901/- (as on A
28.02.2019) towards the fee for renewal of licence which is payable
with interest @ 6% per annum from 28.02.2019. If the amount is not
paid by the sixth respondent, it is for the State of Haryana to proceed
against the sixth respondent to recover the amount as if it is a land
revenue. For the said amount of 21,86,97,901/- (as on 28.02.2019), there
would be a charge on the properties of the sixth respondent-Colonizer. B

48. Issue of encroachment and the expenses met by the
Director, Town and Country Planning, Haryana in engaging the
watch and ward of the licensed area:- In the counter affidavit filed
by the Director, Town and Country Planning, Haryana, it is stated that
an extent of 46.85 acres land was under encroachment/unauthorised C
construction. By the order dated 18.07.2013, the Supreme Court has
directed the Department for watch and ward of the licenced area till the
matter is resolved. In this regard, in the affidavit filed by the Director on
19.08.2019, it is stated that:-
*The Department has hired a private security agency at the D
expense of Rs.2.5 lakh per month, which has deputed twelve
number of security guards for twenty-four hours to keep a watch
and ward of this licensed area. The Department has already paid
approximately Rs.1.25 crores to the security agency. Due vigilance
on the licensed area is being kept and demolition of encroachment/
unauthorised construction is being done by the Enforcement Wing E
of Town and Country Planning, Department. A whatsapp group
of the officials of police department, enforcement wing of this
department and hired security guards has been created to update
the time to time status of unauthorised constructions, if any. For
the awareness of general public, the flex boards have been displayed F
on prominent places of this colony clearly mentioning that matter
of this colony is subjudice and no person can do sale, purchase
of plots and raise unauthorised construction in this colony till the
matter is resolved. Whenever any new illegal construction activity
comes to the notice, the same are immediately removed.* 40
G
49. In the affidavit, it is further stated that there was a big demolition
drive in the colony on 11.04.2017 during which, newly erected thirty-five
residential structures and fifteen numbers of DPC/boundary wall were
removed. It is further stated that even if any small construction activity
like wire fencing, DPC, boundary wall, etc. occurs in the colony, the
40 Point No.4 at Page No.11 of reply filed by DTCP, Haryana on 19.08.2019. H
300 SUPREME COURT REPORTS [2019] 13 S.C.R.

A same is removed by the security guards at the initial stage and the
Department has taken sincere efforts to ensure that no new encroachment
or unauthorised construction has taken place on the licensed area. It is
stated that however, the already existing encroachment over an area of
46.85 acres could not be removed due to Law and Order problem.
B 50. In this regard, DTCP, Haryana has pointed out that an amount
of Rs.1.25 crores already spent by the Department towards the watch
and ward and the same is also payable by the sixth respondent-Colonizer.
Thus, the total amount payable by the Colonizer to the Department is
Rs.21,86,97,901/- (as on 28.02.2019) which is payable with interest @
6% per annum from 28.02.2019 Plus Rs.1.25 crores borne by the
C Department to the security agency till August, 2019-the date of filing of
the affidavit before the Supreme Court and further expenses borne by
the Department for watch and ward of the licensed area and other
incidental expenses. If the above amount is not paid by the sixth
respondent-Colonizer, it is for the State of Haryana to proceed against
the sixth respondent to recover the amount as fee which is a land revenue.
D
51. Surplus plots, if any, left – Entitlement of respondent
No.6-Colonizer:- It has been submitted by Respondent No.6-Colonizer
that a joint technological survey was conducted by the State and the
Colonizer as per order dated 07.05.2016 of the Arbitrator. In this survey,
electoral and electricity records of the encroached area were taken and
E tallied with the names in the scrutiny report to determine the genuineness
of plot holders. It was found that a considerably large number of
petitioners before this Court are already living on the licensed land* 41.
Respondent No.6 is required to submit a final list of such claimants before
the Arbitrator. It is clarified that if it is found that any allottee is already
F living on the encroached land, they would not be entitled from claiming
any further allotment in their favour.
52. Surplus plot if any – Entitlement of Respondent No.6-
Colonizer:- One last issue as to the entitlement over the surplus land, if
any, left after allotment of land to eligible allottees has to be settled. In
this context, it is observed that though there are various claims as to who
G
is the present Director of M/s Durga Builders Private Limited, there is
no serious dispute that the land in question was owned by said M/s
Durga Builders Private Limited and its associate companies. Licenses
were also granted to them by the State of Haryana. These licenses have
41Under Point No.4 at Pg.3 of submissions on behalf of R6 to clarifications
H sought by the Supreme Court vide order dated 14.02.2019.
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 301
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

long since expired and have not been renewed after 1999. However, till A
date no action has been taken against these companies on account of
non-renewal of license. According to the State of Haryana, an amount
of Rs. 21,86,97,901/- (as on 28.02.2019) is outstanding against licence
renewal fee. On payment of this outstanding amount against the license
renewal fee with interest from 28.02.2019 and also on payment of
expenses borne by DCTP in engaging the security agencies for watch B
and ward of the licensed area, M/s Durga Builders Private Limited and
its associate companies would be entitled to claim the surplus plots.
53. Additionally, in case, if any of the allottees are not in a position
to pay the apportioned internal and external development charges and
expresses willingness to quit and consequently the plot falls vacant, the C
same shall be considered being allotted to the sixth respondent-Colonizer,
of course, striking a balance between the allottee of the plot and the
Colonizer. The Arbitrator shall determine the compensation payable by
the sixth respondent-Colonizer and direct the sixth respondent-Colonizer
to compensate the allottee of the plot by directing the sixth respondent-
D
Colonizer to pay adequate compensation in lieu of the claim for the plot
falling vacant. In order to make a claim for such plots falling vacant, the
sixth respondent-Colonizer is to pay:- (i) the compensation to allottee as
directed by the learned arbitrator; and (ii) to pay the apportioned amount
of internal and external development charges.
Question No.4:- The last direction as sought by the E
Arbitrator is to pass appropriate directions for converting these
proceedings to that of a Special Committee:-
54. In this context, we may usefully refer to the order of
appointment of the Arbitrator dated 27.01.2016 wherein, this Court
providedthat all the parties shall submit their respective proposed terms F
of reference before the Arbitrator who shall first settle the terms of
reference and thereafter, resolve the disputes involved between the
parties. On completion of the arbitral proceedings, the Arbitrator was
directed to submit a report to the Supreme Court.
55. Arbitration is a mechanism to settle the disputes of the parties G
on the basis of the terms of arbitration agreement between the parties.
In the present case, there is no agreement between the parties. The
matter was referred to Justice Vikramjit Sen only as a remedial measure
to solve the grievance of the petitioners who were aggrieved by the non-
allotment of the plots by Colonizer and to resolve the lengthy issue
H
302 SUPREME COURT REPORTS [2019] 13 S.C.R.

A involved in such allotment. Thus, the instant arbitration proceedings cannot
be strictly called so and the term ‘arbitration’ in this context is a misnomer
and the proceedings actually are one of a Special Committee.
56. In his letter dated 23.01.2018, the Arbitrator has also observed
that “these proceedings are not in the nature of arbitration and
B essentially, in the nature of a Special Committee of the Hon’ble
Supreme Court of India.” We fully agree with the views expressed by
Justice Vikramjit Sen. It is made clear that the present proceedings are
not in the nature of arbitration within the meaning of the Arbitration and
Conciliation Act, 1996; but essentially, in the nature of a Special
Committee constituted by the Hon’ble Supreme Court of India.
C Other observations relevant for determination of the issue:-
57. Remuneration payable to the Arbitrator:- As to the
question of remuneration payable to the Arbitrator, reference can be
made to the order dated 27.01.2016 wherein, it was provided that the
fee shall be decided by the Arbitrator and be borne equally by all the
D parties. Accordingly, the Arbitrator shall decide his fee to be payable by
the parties as directed by the learned arbitrator.
58. Summary of Conclusion:-
Number of claimants settled by the Scrutiny Committee:-

E
• The number of eligible allottees are to be decided by the
Arbitrator applying the parameters as set out in the order of
the Arbitrator dated 07.05.2016 and the learned Arbitrator to
determine the final list of eligible plot owners in all the categories
– NPNL, Economic Weaker Sections (EWS) and General and
also commercial.
F • Once the allottees are identified and the allottees pay the
apportioned development charges, the learned Arbitrator shall
direct the Director to execute necessary documents in favour
of the allottees in terms of Section 8(4) of the HDRA Act.
Question No.1:
G
• Members of the petitioner association/allottees purchased the
plots from the Colonizer who held the above seven licences
and therefore, they are entitled to the entire extent of land as
per the layout without going into the question of which is the
portion of the land M/s Durga Builder Pvt. Ltd. is claiming
H succession.
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 303
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

• The claim of the sixth respondent can be considered by the A
arbitrator only subject to the payment of licence renewal fee
of Rs.21,86,97,901/- (as on 28.02.2019) with interest @ 6%
from 28.02.2019 plus Rs.1.25 crores borne by DTCP, Haryana
in maintaining the security as per the order of the Court dated
18.07.2013.
B
• The claim of the sixth respondent-colonizer could be considered
only if respondent No.6-Colonizer pays the licence renewal
fee of Rs.21.89 crores and other amount spent by DTCP,
Haryana towards keeping watch and ward of the licensed area
and other charges.
C
• On payment of this outstanding amount against the license
renewal fee with interest from 28.02.2019 and also on payment
of expenses borne by DCTP in engaging the security agencies
for watch and ward of the licensed area, M/s Durga Builders
Private Limited and its associate companies would be entitled
to claim the surplus plots. D
• Claim of Mr. Arun Mehra qua 87 plots:- So far as the
claim of Mr. Arun Mehra in respect of 87 plots, liberty is granted
to Mr. Arun Mehra to work out his remedy in accordance with
law by agitating the matter before the competent court.
However, it is made clear that the claim of Mr. Arun Mehra in
respect of 87 plots shall not come in the way of the claim of E
the beneficiaries.
Question No.2:
• The Town and Country Planning Department has stated that
only after payment of at least 90% of the total amount, they F
will undertake the work.
• A total amount of Rs.128,70,00,000/- (Rs.117,00,00,000/- on
account of internal and external development work +
Rs.11,70,00,000/- as 10% additional cost) is payable to the
DTCP, Haryana. The total amount of Rs.128,70,00,000/- is
payable by the members of the petitioners’ association and G
eligible plot owners to the Director General, Town and Country
Planning (DGTCP), Haryana for undertaking and completing
the internal and external development works.
• Out of the above amount of Rs.128,70,00,000/-, Rs.70 lakhs to
be kept apart to enable the Director, Town and Country H
304 SUPREME COURT REPORTS [2019] 13 S.C.R.

A Planning, Haryana to adjust the expenditure so far borne by
DTCP in issuing various advertisements and other such
incidental expenses.
• As regards the internal development charges, the court in its
order dated 07.04.1997 noted that the Government has fixed
B Rs. 878/- for the plots of the size 135 sq. yards to 170 sq.
yards and Rs. 975/- for plots of 171 to 220 sq. yards. As to the
external development, it was worked out at Rs. 4,70,000/- per
acre which was to be borne by the allottees. 42 However, it is
stated only some of the allottees (according to the Colonizer,
only 143 of the allottees) have complied with the order of the
C Supreme Court. But according to the petitioners that in
compliance of the order of the Supreme Court, they have paid
the amount. This has to be verified; those of them who have
not complied with the order of the Supreme Court shall be
directed to pay the amount with 6% interest on the amount
payable from 01.01.1998.
D Apportionment of the amount and consequence of failure
to pay:-
• The Arbitrator shall determine the cost for the square meter
and proportionately apportion the total cost amongst the eligible
plot owners depending on their respective plot size.
E
• The General Secretary of petitioners’ association has
undertaken that its members shall pay the development charges
within the stipulated time frame fixed by the Arbitrator/State
of Haryana.
• The payment of apportioned amount should be a time bound
F one. In case if any of the plot owner (who has already obtained
the sale deed) does not pay the apportioned external and internal
development charges within the time frame, the developments/
amenities like sewerage, water connection, electricity and other
developments shall not be extended to him.
G • In case the claimants who have not so far got the sale deed
executed express unwillingness to pay the proportionate/
apportioned development charges or fail to give an undertaking
within the given time frame, the land allotted to them will revert
to the Colonizer on certain conditions viz. – (i) colonizer will

H
42 (Para No.8 of Proceedings of the Supreme Court dated 07.04.1997).
OKHLA ENCLAVE PLOT HOLDERS’ WELFARE 305
ASSOCIATION v. UNION OF INDIA [R. BANUMATHI, J.]

pay the claimant the amount paid towards the cost of land with A
interest from the date on which such payment was made at a
rate which may be considered appropriate by the arbitrator;
and(ii) in addition to the above, the Colonizer shall also pay the
proportionate amount towards development works payable for
the said plot to the government of Haryana.
B
• Insofar as the other categories of allottees who have been
identified and who are yet to get the sale deed, in case if they
do not pay the development charges within the time frame, as
discussed earlier, they shall forfeit the right over the plot. The
Colonizer has undertaken to compensate such allottees and
pay the amount to such allottees as refund the amount to the C
allottees in case of failure to pay the apportioned amount by
the individual plot owners.
Question No.3:-
• Insofar as the question raised by the learned Arbitrator that
whether the present density norms can be relaxed for the D
project, Mr. Maninder Singh, learned Senior counsel appearing
for the State of Haryana has submitted that the density norms
like the area reserved for roads, common purposes, etc. cannot
be reduced.
• Insofar as the density of the plots, the learned Arbitrator if E
need be, shall make appropriate adjustments of the plots in
conformity with the existing rules. The adjustments of the plot
area will have to be done from amongst the plot owners. The
State of Haryana shall render its co-operation in adjustment of
the plot sizes in the approved layout of course, subject to the
conformity with the existing rules and governing sanction of F
the scheme.
Question No.4:-
• It is made clear that the present proceedings are not in the
nature of arbitration within the meaning of the Arbitration and
Conciliation Act, 1996; but essentially, in the nature of a Special G
Committee constituted by the Hon’ble Supreme Court of India.
Other observations relevant for determination of the issue:-
• The sixth respondent-Colonizer is bound to pay the licence fee
of Rs. 21,86,97,901/- (as on 28.02.2019) towards renewal of
licence with interest @ 6% per annum from 28.02.2019. If the H
306 SUPREME COURT REPORTS [2019] 13 S.C.R.

A amount is not paid, it is for the State to proceed against the
sixth respondent to recover the amount as if it is a land revenue.
For the said amount of 21,86,97,901/- (as on 28.02.2019), there
would be a charge on the properties of the sixth respondent-
Colonizer.

B • Upon the payment of Rs.21,86,97,901/- as licence fee,
respondent No.6-Colonizer is at liberty to work out his remedy
qua the encroached area of 46.85 acres in accordance with
law and also the surplus plots as determined by the learned
arbitrator.
• Pursuant to the order passed by the Supreme Court, DTCP,
C Haryana has stated that it has spent an amount of Rs.1.25
crores towards watch and ward and the same is payable by
the Colonizer. Thus, the colonizer shall pay Rs.1.25 crores to
DTCP, Haryana till August, 2019-the date of filing of the affidavit
before the Supreme Court and further expenses borne by the
Department for watch and ward of the licensed area and other
D incidental expenses. If the above amount is not paid by the
sixth respondent-Colonizer, it is for the State of Haryana to
proceed against the sixth respondent to recover the amount as
land revenue.
• On payment of licence fee and other dues, the Colonizer would
E be entitled to make a claim for the surplus plots, if any, left
over.
59. We place on record the valuable assistance rendered by learned
Senior counsel, Mr. Raju Ramachandran, learned amicus curiae who is
assisted by Ms. Rashmi Nandakumar, Advocate. We also place on record
F the co-operation rendered by Mr. R. Basant and Ms. V. Mohana, learned
senior counsel appearing for the petitioner-Association; Mr. Maninder
Singh, learned Senior counsel and Dr. Monika Gusain, learned counsel
appearing on behalf of State of Haryana and DTCP; and Mr. Satvik
Varma and Mr. Mohit Mudgal, learned counsels appearing on behalf of
the sixth respondent-Colonizer.
G 60. Accordingly, the clarifications sought by the Learned Arbitrator
are answered.
61. All pending applications shall stand closed.

Devika Gujral Directions issued.
H