Supreme Court of India
R.K. MITTAL & ORS.versusSTATE OF UTTAR PRADESH & ORS.
- Citation
- 2011 INSC 836
- Decided
- 5 December 2011
- Disposal
- Disposed off
- Bench
- SWATANTER KUMAR
Holding
The Development Authority has no power to permit users other than residential in residential sectors except by duly amending the Master Plan and Regulations; any such deviation is an impermissible change of user.
Summary
The Supreme Court examined whether the New Okhla Industrial Development Authority could allow banks, nursing homes and other commercial activities in plots designated as residential under the Master Plan, lease deeds and the U.P. Industrial Area Development Act, 1976. The appellants had let their residential plot to a bank and an IT firm, arguing that a public notice proposing mixed‑use created a legitimate expectation. The Court held that the Authority’s power is limited to the uses specified in the Master Plan and Regulations and any change of user requires a lawful amendment of those instruments, not a mere policy decision. Consequently, the bank and nursing‑home operations were deemed a clear violation of the statutory scheme. The Court ordered the cessation of all non‑residential activities, restoration of the plots to residential use, and permitted only limited professional use (up to 30% of the ground‑floor FAR) subject to charges. The appeals were dismissed and the Development Authority was directed to enforce the orders.
Issues considered
- The scope of the Development Authority's power to permit non‑residential uses in sectors earmarked for residential use under the Master Plan and Regulations.
- Whether allowing banks, nursing homes or other commercial activities constitutes an impermissible change of user under the U.P. Industrial Area Development Act, 1976 and the 1991 Regulations.
- Whether the lease and transfer deeds restricting use to residential purposes can be overridden by the Authority's policy decisions or public notices.
- The effect, if any, of a public notice proposing mixed‑use on the statutory rights and whether it creates a doctrine of legitimate expectation.
- The permissible extent of professional (clinic, lawyer, architect) use in residential premises.
Legislation cited
- New Okhla Industrial Development Area Building Regulations and Directions, 2006s. 3.12(h), s. 3.22
- New Okhla Industrial Development Area (Preparation and Finalization of Plan) Regulations, 1991s. 10, s. 11, s. 2, s. 3, s. 4, s. 5, s. 9
- U.P. Industrial Area Development Act, 1976s. 14, s. 14-A, s. 15, s. 19, s. 31, s. 37, s. 41, s. 6(2)(b), s. 7, s. 8
- U.P. Urban Planning and Development Act, 1973
Subjects
Town planningChange of land useMaster PlanResidential useCommercial activityDevelopment authorityStatutory interpretationLease deedUnauthorized useZoning regulationsProfessional use in residential premises
Judgment
(2011] 15 (ADDL.) S.C.R. 877
R.K. MITTAL & ORS. A
v.
STATE OF UTIAR PRADESH & ORS.
(CIVIL APPEAL NO. 6962 OF 2005)
DECEMBER 05, 2011
B
[SWATANTER KUMAR AND
RANJANA PRAKASH DESAI, JJ.]
Town Planning - Change of user of land - Permissibility
- Power of New Okhla Industrial Development Authority to
permit users, other than residential, in the sectors specifically C
earmarked for 'residential use' in the Master Plan of the New
Okhla Industrial Development Area - Ambit and scope of -
Held: A decision sought to be taken by the Development
Authority in the garb of a policy decision matter, if not in
conformity to the Master Plan, the Regulations and provisions D
of the Act in force, would be an action extra }us - The
Development Authority or its officers, have no power to vary
the user and spaces prescribed in the Master Plan, except
by amending the relevant laws and that too, for a proper object
and purpose - In the present case, the action of the E
Development Authority in permitting mixed user was in
apparent violation of the statutory provisions in the Master
Plan - Establishment of banks and nursing homes in the
residential sectors meant for residential use alone was
unequivocal violation of the statutory provisions in the Master F
Plan - No power was vested in the Development Authority to
permit such user and ignore the misuse for such a Jong
period - All the cases where banks, nursing homes or any
commercial activity was being carried on, particularly like the
appellants' case, where a bank and company were running G
their offices in the residential sectors amounted to change of
user and was thus impermissible - The lessees, who changed
the user contrary to law, are liable to be proceeded against
as per the terms of the lease deed and the provisions of the
877 H
878 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A Act - U.P. Industrial Area Development Act, 1976 - New Okhla
Industrial Development Area (Preparation and Finalization of
Plan) Regulations, 1991 - The New Okhla Industrial
Development Area Building Regulations and Directions,
2006.
B
The ambit and scope of. the power of New Okhla
Industrial Development Authority to permit users, other
than residential, in the sectors specifically earmarked for
'residential use' in the Master Plan of the New Okhla
C Industrial Development Area was the· basic issue in the
instant appeals.
The question that arose for consideration of the
Court was whether the residential premises can be,
wholly or partly, used by the original allottee or even its
D transferee, for any purpose other than residential.
Disposing of the appeals, the Court
HELD: 1.1. The change of user, in the case in hand,
has to be seen in light of the Master Plan, the New Okhla
E Industrial Development Area (Preparation and
Finalization of Plan) Regulations, 1991and the provisions
of the U.P. Industrial Area Development Act, 1976. The
legislative purpose that emerges from the sc'ieme of the
Act and other relevant provisions is to keep 1 residential
F building separate from commercial and other buildings.
This would necessarily imply that the jurisdiction of the
Development Authority to permit different user in violation
of this statute and the Regulations is not contemplated
in law. In the present case, the change in user of the
G building was violative not only of the New Okhla Industrial
Development Area (Preparation and Finalization of Plan)
Regulations, 1991, byelaws and the provisions of the U.P.
Industrial Area Development Act, 1976, but was also
contrary to the law governing erection of the building.
H
R.K. MITTAL & ORS. v. STATE OF UTTAR PRADESH 879
& ORS.
[Paras 16 and 23] [903-C-E; 905-F-H] A
Hari Rao v. N. Govindachari & Ors. (2005) 7 SCC 643:
2005 (3) Suppl. SCR 217 and Dev Brat Sharma v. Jagjit
Mehta (1990) Supp. SCC 724 - held inapplicable.
2. The development Plan has to be prepared in 8
accordance with the provisions of the Act and the
Regulations framed thereunder. The notified development
Plan has a legal sanction and provisions contained
therein are mandatory in nature. They are incapable of
being altered or varied without following the due process C
prescribed in law. [Para 25] [907-F-H; 908-A-B]
NO/DA Entrepreneurs Association v. NO/DA & Ors.
(2011) 6 SCC 527 and NDMC & Ors. v. Tanvi Trading and
Credit Private Limited and Ors. (2008) 8 SCC 765: 2008 (12) D
SCR 867 - relied on.
3. The development Plan prepared in accordance
with the Regulations take the statutory colour in terms of
Section 6(2)(b) of the Act and, therefore, its alteration by E
an executive order would be impermissible. Even when
a Master Plan is to be amended, the entire prescribed
procedure must be followed. The power to amend should
be exercised only in consonance with the settled norms
without going beyond the original power of the
Development Authority to make such Plan in accordance F
with the provisions of the Act. The power to amend
cannot be used to frustrate the provisions of the statute.
Regulations, being subordinate legislation must fall in
line with the principal provisions of the Act and in no way
should be detrimental to the provisions and the legislative G
scheme of the Act. [Para 26] [908-D-F]
4. The land cannot be permitted to be used contrary
to the stipulated user except by amendment of Master
Plan, after due consideration of the provisions of the Act H
880 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R
A and the Rules. Inaction by the Government authorities
means permitting the unauthorized use, contrary to law.
The authorities while reconsidering such matters arti
expected to act reasonably and cautiously. They deal
with larger public interest and, therefore, have a
s responsibility to act with greater degree of sensitivity and
proper application of mind. If the Development Authority
aids the violation of the statutory provisions, it will be a
perversity in the discharge of statutory obligations on the
part of the Development Authority. The public interest, as
c codified in the statutory regulations and the provisions
of the Act, should control the conduct of the Development
Authority and its decision making process, rather than
popular public demand guiding the exercise of its
discretion, that too, in a somewhat arbitrary manner.
D [Paras 27, 28] [908-H; 909-A-D]
5. The power given to the Authority has to be
construed in strict terms and it cannot be exercised in a
manner which will run contrary to the scheme of the Act
and which would defeat the very object of the Act and the
E Regulations. The jurisdiction of the Development
Authority has to be seen on the touchstone of proper
exercise of power within its legal limitations while giving
full effect to the statutory provisions. [Paras 29, 30] [91 O-
F-HJ
F
6. It is not merely at the discretion of the
Development Authority concerned to designate user of
a site and then alter the same without following due
process of law. Even where such an exercise is required
G to be undertaken by the Development Authority, there
also it is expected of the Development Authority to act for
the betterment of the public and strictly in .::ccordance
with the Plans and the statutory provisions. It cannot take
recourse to its powers and use its discretion contrary to
such provisions and that too, to frustrate the very object
H of the Act. Exercise of power ought not to be destructive
R.K. MITTAL & ORS. v. STATE OF UTTAR PRADESH 881
& ORS.
of the provisions of the Act and the Plans, having the A
force of law. Even where the requisite prescribed
procedure is followed, still the discretion should be
exercised sparingly for achieving the object of the statute
and not to completely vary or destruct the purpose for
which the sector has been earmarked. [Para 33] [912-E- B
H]
MC. Mehta v. Union of India & Ors. (2004) 6 SCC 588:
2004 (2) Suppl. SCR 504; Bangalore Medical "Trust v. B.S.
Mudappa & Ors. (1991) 4 SCC 54: 1991 (3) SCR 102; S.N.
Chandrashekar & Anr. v. State of Kamataka & Ors. (2006) 3 C
sec 208 : 2006 (1) SCR 1039; ITC Ltd. v. State of Uttar
Pradesh & Ors. (2011) 7 SCC 493 and Dr. G.N. Khajuria &
Ors. v. Delhi Development Authority & Ors. (1995) 5 SCC
762: 1995 (3) Suppl. SCR 212- relied on.
D
7. A decision which is sought to be taken by the
Development Authority in the garb of a policy decision
matter, if not in conformity to the Master Plan, the
Regulations and provisions of the Act in force, would be
an action extra jus. The Development Authority is to act E
in adherence to the provisions of the law regulating such
user or construction. The Development Authority or its
officers, have no power to vary the user and spaces
prescribed in the Master Plan, except by amending the
relevant laws and that too, for a proper object and F
purpose. Any decision, as a policy matter or otherwise,
for any extent of public convenience, shall be vitiated, if
it is not supported by the authority. The Courts would
examine what is the sensible way to deal with this
situation, so as to give effect to the presumed purpose G
of the legislation. The provisions in question should be
construed on their plain reading, supporting the structure
of the legislative intent and its purpose. The rule of
schematic interpretation would come into play in such
situations and the concerned Development Authority H
cannot be permitted to overreach the procedure
882 SUPREME COURT REPORTS [2011] 15 (ADDL.) S C.R.
A prescribed by law, with designs not acceptable in law.
[Para 34] [913-A-D]
8. The Development Authority is inter a/ia performing
regulatory functions. There has been imposition of
8 statutory duties on the power of this regulatory authority
exercising specified regulatory functions. Such duties
and activities should be carried out in a way which is
transparent, accountable, proportionate and consistent.
It should target those cases in which action is called for
C and the same be exercised free of arbitrariness. The
Development Authority is vested with drastic regulatory
powers to investigate, make regulations, impute fault and
even to impose penalties of a grave nature, to an extent
of cancelling the lease. The principles of administrative
justice squarely apply to such functioning and are
D subject to judicial review. The Development Authority,
therefore, cannot transgress its powers as stipulated in
law and act in a discriminatory manner. The Development
Authority should always be reluctant to mould the
statutory provisions for individual, or even public
E convenience as this would bring an inbuilt element of
arbitrariness into the action of the authorities. Permitting
mixed user, where the Master Plan does not so provide,
would be glaring example of this kind. [Para 35] [913-E-
H; 914-A]
F
9.1. In the present case, the action of the
Development Authority in permitting mixed user was in
apparent violation of the statutory provisions in the
Master Plan. Establishment of banks and nursing homes
G in the residential sectors meant for residential use alone
was unequivocal violation of the statutory provisions in
the Master Plan. (Paras 38, 39) [914-G-H]
9.2. The lease deed executed in favour of the
predecessor-in-interest of R.K. Mittal and the other
H appellants had contained specific stipulations that the
R.K. MITTAL & ORS. v. STATE OF UTTAR PRADESH 883
& ORS.
lessee will obey and submit to all directions issued, A
existing or thereafter to exist, as obeyed by the lessor.
The erection of the structure was also to be in
accordance with the approved plans. Clause (h) of the
lease deed specifically provides that the constructed
building shall be used only for the purpose of residential, B
residential-cum-medical or surgical clinic and for no other
purpose, that too subject to such terms as are imposed
by the lessor. [Para 40] [915-A-C]
9.3. The transfer deed which was executed in favour
of the present appellants, with the approval of the C
Development Authority, also contained similar clauses
and also provided that the terms and conditions imposed
by Development Authority from time to time shall be
binding on the transferee. Clause 15 of the transfer deed
stipulated that the transferee shall put the property to use D
exclusively for residential purpose and shall not use it for
any purpose other than residential. After raising the
construction on the plot in question, admittedly, the
appellants have put the property to a different use other
than residential. The property was rented out to two E
different commercial undertakings, i.e., Andhra Bank and
a company by the name 'Akariti lnfotech'. It is not even
the case of the appellants that the Development Authority
had granted any specific permission to them to use the
property for any purpose other than residential. [Para 41] F
[915-C-F]
9.4. The appellants, in fact, relied upon an agenda
note where there was a proposal put forward by the
Development Authority to grant permission for nursing G
home, guest house, lodging house, banks etc. on a 100
metres wide road on such terms and conditions as may
be imposed by the Development Authority. This also
provided for levying certain additional charges for
granting such permission. Based on this proposal, it is
H
884 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A stated that a public notice was issued and objections
were invited. The matter rested at that. This was not
finalized. In other words, no final decision was taken by
the Development Authority in consonance with the
provisions of the Act to permit such user in the residential
B sector. It is a settled position of law that no authority can
exercise the power vested in it, contrary to law. In the
present case, there appears to be no proper data
collected or study carried out by the Development
Authority even for mooting such a proposal, much less
c amending the Plan or the Regulations. It is a matter of
regret that the Development Authority is dealing with
such serious matters in such a casual manner. Either
way, this certainly affected the rights of the parties
adversely. It is not only the rights of individuals which are
to be examined by the authorities concerned, but also the
0
effect of such amendment on the residential sector as a
whole which is one of the relevant factors to be
considered. [Paras 42, 43] (915-G-H; 916-A-D]
9.5. The running of a bank or a commercial business
E by a company in the residential sector is certainly not
permissible. In fact, it is in patent violation of the Master
Plan, Regulations and the provisions of the Act. No power
is vested in the Development Authority to permit such
user and ignore the misuse for such a long period. [Para
F 44] [916-E]
9.6. All the cases where banks, nursing homes or any
commercial activity is being carried on, p<'rticularly like
the appellants' case, where a bank and company are
running their offices in the residential sectors would
G amount to change of user and thus be impermissible. The
officers of the Development Authority should refrain from
carving out exceptions to the implementation of the
Master Plan and the Regulations in force, that too without
the authority of law. For taking up any exercise for
H change of user or such similar conditions, amendment
R.K. MITTAL & ORS. v. STATE OF UTTAR PRADESH 885
& ORS.
to the relevant Regulations, Master Plan and if needed, A
the provisions of the Act, is a condition precedent. It
should be ensured that such exercise would further the
cause and object of the Act and would not be destructive
to the scheme of the development. No such jurisdiction
or authority vests in the officers of the Development s
Authority to permit change of user in its discretion and
in violation of the law in force. [Para 47] [917-G-H; 918-A-
B)
Shabi Construction Company v. City & Industrial
Development Corporation & Anr. (1995) 4 SCC 301 : 1995 C
(3) SCR 534 and K.K. Bhalla v. State of M.P. & Ors. (2006)
3 SCC 581 : 2006 (1) SCR 342 - relied on.
10. The action of the Development Authority should
be free of arbitrariness and must be applied uniformly. D
The doctrine of reasonable expectation has no
applicability to the present case and there cannot be any
waiver of statutory provisions as well. The user of a sector
is provided under the Master Plan and in furtherance to
Regulations and the provisions of the Act. It is incapable E
of being administratively or executively altered. The
lessees, who have changed the user contrary to law, are
liable to be proceeded against as per the terms of the
lease deed and the provisions of the Act. [Para 52) [921-
D-G] F
11. The Master Plan and the Zonal plan specify the
user as residential and therefore these plots cannot be
used for any other purpose. The Plans have a binding
effect in law. If the scheme/Master Plan is being nullified
by arbitrary acts and in excess and derogation of the G
power of the Development Authority under law, the Court
will intervene and would direct such authorities to take
appropriate action and wherever necessary even quash
the orders of the public authorities. [Para 53] [921-H; 922-
A-B] H
886 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A 12. An ancillary question that came up for
consideration was as to how much area can be permitted
to be used by a doctor to run his clinic or by a lawyer or
architect to run their offices in the residential sector. If
other conditions are satisfied, then as the law stands
B today, according to the Development Authority, they can
be permitted to use 30 per cent of the Floor Area Ratio
(FAR) of the ground floor for their clinics/offices. It would
be suffice if 30 per cent of the ground floor area is
permitted to be used for office of an architect/lawyer and
c for clinic simplicitor by a doctor. [Para 54] [923-E-G]
K. Ramadas Shenoy v. Chief Officer, Town Municipal
Councl1, Udipi and Others (1976) 1 SCC 24; M.I. Builders v.
Radhey Shyam Sahu [(1999) 6 SCC 464]: 1999 (3)
SCR 1066; Virender Gaur & Ors. v. State of Haryana & Ors.
D [(1995) 2 sec 5771 : 1994 (6) Suppl. SCR 78 and Delhi
Pradesh Citizen Council Vs. Union of India & Anr. (2006) 6
sec 305 - relied on.
13. The law imposes an obligation upon the
E Development Authority to strictly adhere to the plan,
regulations and the provisions of the Act. Thus, it cannot
ignore its fundamental duty by doing acts impermissible
in law. The concept of public accountability and
performance of public duties in accordance with law and
F for the larger public good are applicab!e to statutory
bodies as well as to the authorities functioning therein.
There is no justification, whatsoever, for the respondents
to act arbitrarily. There is also no justification for the
Development Authority to issue a public notice in the
G fashion in which it has done. A few officers of the
Development Authority cannot collectively act in violation
of the law and frustrate the very object and purpose of
the Master Plan in force, Regulations and provisions of
the Act. [Para 55] [924-A-E]
H
R.K. MITTAL & ORS. v. STATE OF UTIAR PRADESH 887
& ORS.
14. Tl:le appeals are accordingly disposed of in the A
following terms:-
a. That banking or nursing homes or any other
commercial activity is not permitted in Sector 19 and
for that matter, in any sector, in the Development Area
B
earmarked for 'residential use'.
b. That the 21 banks and the nursing homes, which
are operating in Sector 19 or any other residential
sector, shall close their activity forthwith, stop
misuse and put the premises to residential use alone, C
within two months.
c. That lessees of the plots shall ensure that the
occupant banks, nursing homes, companies or
persons carrying on any commercial activity in the 0
residential sector should stop such activity and shift
the same to the appropriate sectors i.e. commercial,
commercial pockets in industrial/institutional area
and specified pockets for commercial use within the
residential sector, strictly earmarked for that activity
E
in the development Plan, Regulations and provisions
of the Act.
d. That the Development Authority shall consider the
request for allotment of alternative spaces to the
banks and the persons carrying on other commercial F
activities, with priority and expeditiousness.
e. That the Doctors, Lawyers and Architects can use
30 per cent of the area on the ground floor in their
premises in residential sector for running their clinics/ G
offices.
f. That for such use, the lawyers, architects and
doctors shall be liable to pay such charges as may
be determined by the Development Authority in
accordance with law and after granting an H
888 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A opportunity of being heard. The affected parties
would be at liberty to raise objections before the
Development Authority that no charges are payable
for such users as per the law in force.
B g. In the event the lessee or the occupant fails to stop
the offending activity and/or shift to alternate
premises within the time granted in this judgment, the
Development Authority shall seal the premises and
proceed to cancel the lease deed without any further
delay, where it has not already cancelled the lease
c deed.
h. Wherever the Development Authority has already
passed the orders cancelling the lease deeds, such
orders shall be kept in abeyance for a period of two
D months. In the event the misuse is not stopped within
a period of two months in terms of this judgment,
then besides sealing of the premises, these orders
of cancellation shall stand automatically revived and
would come into force without further reference to
E any Court. In the event the misuse is completely
stopped in all respects, the orders passed by the
authorities shall stand quashed and the property
would stand restored to the lessees.
i. These orders shall apply to all cases, where the
F order of termination of lease has been passed by the
Development Authority irrespective of whether the
same has been quashed and/or writs of the lessees
dismissed by any Court of competent jurisdiction
and even if such judgment is in appeal before this
G Court.
j. The orders in terms of this judgment shall be
passed by an officer not below the rank of
Commissioner. This order shall be passed after
H giving an opportunity to the parties of being heard
R.K. MITTAL & ORS. v. STATE OF UTTAR PRADESH 889
& ORS.
by such officer. This direction shall relate only to the A
determination of charges, if any, payable by the
lessee or occupant for the period when the
commercial activity was being carried on in the
premises in question. [Para 56] [924-E-H; 925-A-H;
926-A-F] B
Case Law Reference:
2005 (3) Suppl. SCR 217 held inapplicable Para 19
(1990) Supp. sec 724 held inapplicable Para 19
c
(2011) 6 sec 527 , relied on Para 25
2008 (12) SCR 867 relied on Para 25
2004 (2) Suppl. SCR 504 relied on Para 27
1991 (3) SCR 102 relied on D
Para 28
2006 (1) SCR 1039 relied on Para 30
(2011) 7 sec 493 relied on Para 31
1995 (3) Suppl. SCR 212 relied on Para 32 E
1995 (3) SCR 534 relied on Para 36
2006 (1) SCR 342 relied on Para 37
(1976) 1 sec 24 relied on Para 53
F
1999 (3) SCR 1066 relied on Para 53
1994 (6) Suppl. SCR 78 relied on Para 53
(2006) 6 sec 305 relied on Para 54
G
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
6962 of 2005.
From the Judgment & Order dated 9.1.2002 of the High
Court of Judicature at Allahabad in Civil Miss. Writ Petition No.
36709 of 2010. H
890 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A WITH
C.A. No. 6963 of 2005.
C.A. No. 10535 and 10536 of 2011.
B Himanshu Munshi, Jitendra Mohan Sharma, Sandeep
Singh, Vibhor, Ajit Sharma, Vivek Sharma and Neeraj Kr.
Sharma for the Appellants.
Ravindra Kumar. Shrish Kumar Misra, Shiel Sethi,
C Rachana Joshi lssar, Nidhi Tewari, Ambreen Rasool, Alok
Prakash, Vinay Kumar Garg, Himanshu Munshi, Pahlad Singh
Sharma, Navin Chawla, Manoj Swarup & Co., C. Mukund, Bijoy
Kumar Jain, A. Jain and Pankaj Jain for the Respondents.
The Judgment of the Court was delivered by
D
SWATANTER KUMAR, J. 1. Leave granted in both the
Special Leave Petitions.
2. The ambit and scope of power of New Okhla Industrial
Development Authority (for short, the 'Development Authority')
E to permit users, other than residential, in the sectors specifically
earmarked for 'residential use' in the Master Plan of the New
Okhla Industrial Development Area (for short, the 'Development
Area') is the basic question that falls for consideration of this
Court in this bunch of appeals. These appeals demonstrate
F some of the instances of widespread violation of statutory
provisions and somewhat arbitrary exercise of power by the
Development Authority. Lack of adoption of uniform application
of law has resulted in large nur, 1ber of cases of violation of law
all over the State of Ullar Pradesh going unnoticed. The time
G has come for the Development Authorities to change their style
of functioning and act vigilantly and uniformly, that too, strictly
in accordance with law, keeping in view the larger public
interest.
H
R.K. MITTAL & ORS. v. STATE OF UTTAR PRADESH 891
& ORS. [SWATANTER KUMAR, J.)
Introductory Facts A
3. This judgment shall dispose of the above referred four
civil appeals and the applications for intervention therein. Out
of the four appeals, in Civil Appeal No. 6962 of 2005and Civil
Appeal arising out of SLP(C) No. 24029 of 2005, the lease
8
deed in favour of the parties had been cancelled by the
Development Authority while in other two appeals, Civil Appeal
No. 6963 of 2005 and Civil Appeal arising out of SLP (C)
No.9150 of 2007, after giving notice, it had passed an order
requiring the parties concerned to stop the misuse within the
stipulated time, failing which appropriate action in accordance C
with ldw, including cancellation of the lease deed, would be
taken. The facts and circumstances in all the appeals and even
the intervention applications are somewhat similar. In any case,
the common question of law arising in·a11 the appeals and
applications is whether the residential premises can be, wholly D
or partly, used by the original allottee or even its transferee, for
any purpose other than residential? We do not consider it
necessary to refer to the facts of each case in greater detail,
except the facts of the lead case, i.e., Civil Appeal No.6962 of
2005, RK Mittal v. State of U.P. However, wherever reference E
to certain additional facts is called for, we would notice the
same in the other cases as well.
4. The Development Authority executed a lease deed
dated 2nd April, 1988 in favour of Shri Rajendra Kumar F
Srivastava in relation to Plot No.778, Block A, Sector XIV, New
Okhla Industrial Development Area, District Ghaziabad,
admeasuring about 274.37 square meters as per the
boundaries described in the deed. Upon the plot, the lessee
raised some construction which remained unfinished. The G
lessee thereupon actually transferred the plot in question along
with unfinished superstructure vide Transfer Deed dated 20th
August, 1999 i.n favour Shri R.K. Mittal, Shri Ashok Garg and
Shri Sanjeev Gupta, the appellants herein. The original lease
deed contained specific stipulations in regard to the lessee H
892 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R.
A being obliged to obey all the Rules, Regulations and Directions
made by the lessor. The lessee was to raise construction as
per approved plans and to use the premises only for the
purpose for which it was committed in terms of the lease and
as per law. These clauses of the lease deed read as under :
B
"(d) That the lessee will obey and submit to all Directions
issued or Regulations made by the Lessor now existing
or hereafter to exist so for as the same are incidental to
the possession of immovable property or so far as they
effect the health, safety or convenience of the other
c inhabitants of the place.
(e) That the Lessee will at his own cost erect on the
demised premises in accordance with the plans, elevation
and design and in a position to be approved by the lessor
D or any officer authorised by the lessor in that behalf in
writing and in a substantial and workman like manner, a
residential building only with all necessary, sewers, drains
and other appurtenances according to the Directions
issued or Regulations made in respect of buildings, drains,
E latrines and connection with sewer.
xxx xxx xxx
(h) That the lessee shall use the demised premises only
for the purpose of constructing a building for residential
F purpose of customary home occupation or residential cum
medical and surgical clinic or dispensary or professional
office and for no other purpose without the consent of the
Lessor and subject to such terms & conditions as Lessor
may impose and will not do or suffer to be done on
G demised premises or any part thereof, any act or thing
which may be or grow to be a nuisance, damage,
annoyance, or inconvenience to the Lessor or the owners,
occupiers of other premises in the neighbourhood."
5. The Transfer Deed executed by the original lessee in
H
·,R.K. MITIAL & ORS. v. STATE OF UTIAR PRADESH 893
& ORS. [SWATANTER KUMAR, J.]
fav_our of the appellants also contained similar conditions and A
in addition thereto provided that the conditions of the lease
deed shall be binding upon the appellants. The relevant clauses
of the Transfer Deed read as under :
"10. That the Transferees shall complete the construction B
of plot and shall obtain Occupancy Certificate of
Plot from Building Cell, Neida within balance
construction period as per terms of lease deed of
plot which is upto 23.2.2000. Extension of time for
construction of plot and for obtaining occupancy
certificate will be granted as per terms of lease c
deed of plot and as per then prevailing extension
policy of NOIDA.
11. That the Transferee shall be bound by the terms and
conditions of lease deed of plot executed on D
2.4.88, subject to the amendments indicated in the
Transfer Memorandum.
xxx xxx xxx
15. That the Transferees shall put the property in the use E
exclusively for residential purpose and shall not use
it for any purpose other than residential.
xxx xxx xxx
F
17. That the terms and conditions amended by the
NOIDA AUTHORITY from time to time shall be
binding on the Transferees aforesaid."
6. After completing the construction, the appellants appear
to have rented out the premises to Andhra Bank and Akariti G
lnfotech. As such, both the bank and the company had been
carrying on their business from the premises in question. The
Developmenf Authority, on 18th January, 2001 and 22nd
February, 2001 issued notices to both Andhra Bank and Akariti
lnfotech to stop commercial use in the said premises within 30 H
894 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A days, failing which action would be taken as per the lease deed.
In these notices, it was also stated that there was
encroachment in violation of the prescribed building byelaws
and the use of residential plot for commercial purpose was in
violation of the provisions of the lease deed of the plot. Invoking
B the provisions of the U.P. Industrial Area Development Act,
1976 (for short, 'the Act'), the Development Authority gave them
opportunity to file objections. To these notices, the appellants
not only filed objections but also appeared before the
Development Authority and contended that the Development
c Authority, in furtherance to the proposal to permit running of
consulting clinics, banks and guest houses in the residential
areas, had permitted such use on the main roads, on payment
of 30 per cent of the existing residential rate on per square
meter area of plot per annum and had invited suggestions from
0 the general public. Reliance was also placed on certain press
reports. Noticing these facts and obviously taking the view that
there was no legal sanctity to the alleged change of user, the
Development Authority rejected the objections and required the
misuse to be stopped and the violation of the building byelaws
E to be removed within four months. A part of the said order reads
as follows:
"The terms and conditions of lease deed and transfer deed
of plot clearly states that allotted plot shall be used
exclusively for residential purposes. T~ ? petitioner
F changed the land use of plot without intimating to the
Authority and did not bother to seek any clarification or
obtain permission from the Authority for such change. It is
a well known fact that this Authority does not permit
commercial activity in the residential plots. This is a classic
G case of violation of law by the most educated enlightened
class of the Country. This class in Naida has tried to
change not only the character of Naida but have for self
interest destroyed the peace of the Neighbours. It is also
possible that the then Bank staff also colluded in the matter
H and did not bother to see the conditions contained in the
R.K. MITIAL & ORS. v. STATE OF UTTAR PRADESH 895
& ORS. [SWATANTER KUMAR, J.]
lease deed and did not even try to approach the Authority A
for clarification.
In view of the above stated facts and after listening
to the petitioner, it is ordered that representation pleadings
of the petitioner Allottee of Residential Plot No.A-778, B
Sector-19 stand rejected and the petitioner is also directed
to ensure vacation of bank branch and infotec office from
the residential premises and restore the building according
to prescribed building bye-law within 4 months (Four
Months) from the date of service of this order.
c
7. As the Petitioner has evaded compliance of terms of
lease deed for nearly five months on one pretext or the
other, he is also informed that in case of failure to restore
the land use of plot within stipulated period, the Authority
shall be free to take further action under law WITHOUT D
FURTHER NOTICE.
Orders regarding penalty for misuse of premises will
be passed separately."
7. Aggrieved from the aforesaid order, the appellants filed E
a writ petition before the High Court of Judicature at Allahabad.
The writ petition preferred by the appellants came to be
dismissed vide order dated 19th January, 2002. It was noticed
by the High Court and rightly so, that the Development Authority
had invited some suggestions for change of user of residential F
plots to commercial or mixed user on certain terms and
conditions, by bringing certain changes/amendments in its
byelaws and policy decisions. This remained at an interim
stage and no final decision was taken by any competent
authority in accordance with the provisions of the Act. The G
Development Authority had not undertaken any exercise for the
said amendment in accordance with law and had not even
sought the approval of the State Government, as required
under the law, for change of user or amendment of the byelaws,
Master Plan, etc. In fact, the provisions directing forfeiture of H
896 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R
A property under Section 14 of the Act and imposition of penalty
for misuse in terms of Section 15 of the Act were in force.
Relying upon judgment of this Court in Munshi Ram v. Union
of lndia[(2000) 7 SCC 22], the High Court not only dismissed
the writ petition but also directed the Development Authority to
B take immediate and strong action against those who have
started using residential plots, wholly or partially, for other non-
residential uses. The appellants, feeling dissatisfied by the
judgment of the High Court, have preferred the present appeal
before this Court. In order to complete the factual matrix of the
c case, we may notice that the appellants have placed on record
Annexure P-7, a copy of the public notice dated 30th March,
2000 indicating that there was proposal to grant permission for
mixed use consulting clinics, bank branch and guest houses on
18 A.M. wide roads on the conditions stated therein. These
D conditions also included the provision that fees payable on grant
of permission for mixed use of land would be 30 per cent of
existing residential rate, on per square meter area of plot, on
yearly basis. To this proposal, public opinion was invited and it
was stated that objections/suggestions in this regard may be
filed in writing in the office of the Additional Chief Executive
E Officer of the Development Authority. Even hearing was to be
granted. In the affidavit filed on behalf of the respondent-
Development Authority on 8th October, 2002, it has been
specifically averred that 21 banks were functioning in residential
sector in the Development Area under private arrangements
F with the lessees of the concerned plots and these banks have
not obtained any permission or authorization from the
Development Authority. Two banks, namely, Oriental Bank of
Commerce, Sector 27, Neida and Vijaya Bank, Sector 19,
Naida had obtained such permission for a period of five years
G and three years respectively since 1995 and 1994. These banks
had not obtained any permission or renewal thereafter. Show
cause notices had been issued to all the banks to wind up their
activities from these areas. In para 10 of the affidavit, it had
been stated that the Development Authority 'has taken a firm
H decision to evict all the banks from the residential sectors and
R.K. MITIAL & ORS. v. STATE OF UTIAR PRADESH 897
& ORS. [SWATANTER KUMAR, J.)
notices have been issued to all these 21 banks without A
exception'. A definite averment has also been made in this
affidavit that the functioning of the banks in the residential
sectors caused inconvenience and disturbance to the public at
large and the Development Authority has earmarked specific
areas for making land available to the banks to carry on their B
commercial activities. They have allotted land to several banks
in commercial-cum-institutional and commercial portion of
industrial and institutional sectors. Option was given to the 21
banks to function in these areas and that if they would apply
for the same, the Development Authority shall consider their c
cases sympathetically. The Development Authority, specifically
and with emphasis, reiterated that banking activities cannot be
allowed in residential plots of the residential sector. Another
affidavit was filed on behalf of the Development Authority in
March 2011, wherein a clear stand was taken that as per the D
Master Plan, Sector 19 of the Development Area is a
residential sector, where the land use is residential alone,
neither commercial nor mixed. List of 43 properties in Sector
19, Neida was filed as Annexure-1, where non-residential
activities, including banking and medical clinics, were being
carried on while Annexure-2 related to other 11 properties E
being used for other non-residential purposes in Sector 19 itself.
There are institutional plots in Sector 19, which had been allotted
by the Development Authority for running of nursing homes or
commercial activity. An office order was issued on or about 14th
May, 2009, in relation to Guest Houses, by the Chief Executive F
Officer of the Development Authority. However, the same is
stated to have been withdrawn immediately thereafter. In other
words, according to the respondents, there is no order or
sanction operative and binding as of now, which permits any
user other than residential in the residential sector. G
8. Having stated the facts, we may now examine the
relevant provisions of law. The State of Uttar Pradesh had
enacted the law to provide for creation of an Authority for
development of certain areas of the State into industrial and H
898 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A urban townships and for matters connected therewith. 'Authority'
had been defined under Section 2(b) of the Act to mean the
Authority constituted under Section 3 of the Act. Section 3
required the State Government to constitute, for the purposes
of the Act, an authority for any industrial Development Area in
B terms of that Section. Section 6 of the Act related to functions
of the Authority while Section 7 mentions the powers of the
Authority in respect of transfer of land. In terms of these statutory
provisions, the object of the Authority was to secure the planned
development of industrial Development Area and the Authority
c was required to perform certain functions in terms of Section
6(2), which reads as under:
"2) Without prejudice to the generality of the objects of the
Authority, the Authority shall perform the following
functions-
D
(a) to acquire land in the industrial development area,
by agreement or through proceedings under the
Land Acquisition Act, 1894 for the purposes, of this
Act;
E
(b) to prepare a plan for the development of the
industrial development area;
(c) to demarcate and develop sites for industrial,
commercial and residential purposes according to
F the plan;
(d) to provide infra-structure for industrial, commercial
and residential purposes;
(e) to provide amenities;
G
(f) to allocate and transfer either by way of sale or
lease or otherwise plots of land for industrial,
commercial or residential purposes;
H (g) to regulate the erection of buildings and setting up
R.K. MITIAL & ORS. v. STATE OF UTTAR PRADESH 899
& ORS. [SWATANTER KUMAR, J.]
of industries; and A
(h) to lay down the purpose for which a particular site
or plot of land shall be used, namely for industrial
or commercial or residential purpose or any other
specified purpose in such area.·
B
9. In terms of Section 8 of the Act, for the purposes of
proper planning and development of the industrial development
area, the Authority had the power to issue directions, as it
consider necessary, regarding the factors stated therein,
including restriction of use on any site for a purpose other than c
for which it has been allocated. Every transferee in whose
favour the land was transferred was bound to comply with the
directions issued as expeditiously as possible and was obliged
to erect the building or to take such necessary steps to comply
with the directions in accordance with Section 8(2) of the Act. D
No person could raise construction, erect or occupy the building
in contravention of the building regulations. The Authority has
been vested with the powers to make regulations with the
previous approval of the State Government in terms of Section
19 of the Act, while the State Government may, by notification, E
frame Rules for the purposes of the Act as contemplated under
Section 18 of the Act.
10. Section 2(d) of the Act defines 'Industrial Development
Area' to be an area declared as such by the State Government
by notification. Section 6(2)(b) requires the Authority to prepare F
a plan for the development of an industrial development area
while Section 6(2)(h) enjoins the Authority to lay down the
purpose for which a particular site or plot of land shall be used,
namely for industrial or commercial or residential or any other
specified purpose. The power to transfer lands is also given G
to the Authority. In terms of Section 19 read with Section 6 of
the Act, the New Okhla Industrial Development Area was
notified and the Authority framed the regulations for the
purposes of proper planning and development of that area.
These were called the New Okhla Industrial Development Area H
900 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A (Preparation and Finalization of Plan) Regulations, 1991
[hereafter referred to as 'the Regulations']. Regulation 2 of the
Regulations defines various kinds of uses including 'Land Use'.
'Land Use' under Regulation 2(g) means the use of any land
or part thereof in the industrial development area for industrial,
B residential, institutional, commercial, public water bodies,
organized recreational open spaces, public and semi-public
buildings, agriculture and other like purposes. In
contradistinction to the 'Commercial Use', 'Industrial Use'
'Institutional Use' and 'Public Use', the 'Residential Use' has
c been defined under Regulation 2(1 )(k) which reads as under: -
"{k) 'Residential Use' means the use of any land or
building or part thereof for human habitation and such other
uses incidental to residential uses."
D 11. The expression 'Sector' has also been defined in
Regulation 2(1) to mean any one of the divisions in which the
industrial development area or part thereof may be divided, for
the purposes of development under the Act. Regulation 3
enjoins upon the Authority a duty to prepare a Draft Plan for
E industrial development areas in terms of Regulation 3(1) to 3(6).
Under Regulation 4, the Plan has to include sector plans into
which such industrial area has been divided. It should also
depict the residential use by allocating the area of land for
housing, for different and defined densities and plotted
development for different categories of households in terms of
F Regulation 4(1 )(b)(ii). Similarly, it should also state the
commercial use, public use, agricultural use and other purposes
as the Authority may deem fit. The procedure for finalization of
the Draft Plan is also contemplated under Chapter Ill,
Regulations 5 to 11 of the Regulations. The Regulations
G postulate that the Authority, after preparation of the Draft Plan,
shall, by public notice, invite objections anc! suggestions to be
filed before the date notified but not earlier than 30 days· from .
the date of publication. A proper enquiry and hearing is
contemplated whereafter the Draft Plan is to be finalized in
H terms of Regulation 9 and the date of commencement of the
R.K. MITTAL & ORS. v. STATE OF UTTAR PRADESH 901
& ORS. [SWATANTER KUMAR, J.)
Plan is to be specified in terms of Regulation 10. The Authority A
· has the power to amend the Plans but this power to amend is
restricted in its scope. Regulation 11 empowers the Auth')rity
to do so, but no such amendment can be made which would
result in important alteration in the character of the Plan and
which do not relate to the extent of land use or standards of 8
population density. Even thereafter, it is required to follow the
prescribed procedure. Regulation 11 reads as under: -
"11. Amendment of the Plan. - (1) The Authority may
make such amendments in the Plan which do not effect
important alteration in the character of the Plan and which C
do not relate to the extent of land use or standards of
population density.
(2) Before making any amendment in the Plan under sub-
section (1 ), the Authority shall publish a notice in at least o
one newspaper having circulation in the development are
inviting objections and suggestions from any affected
person with regard to the proposed amendment before
such date as may be specified in the notice and shall
consider all objections that may be received. E
(3) Every amendment made under this Regulation shall be
published in any of the manner specified in Regulation 5
and the amendment shall come into operation either on the
date of the first pµblication or on such other date as the
Authority may fix. F
(4) The Authority shall not make during the specified period
in which the Plan is to remain effective, such
amendment(s) in the Plan which affects important alteration
in the character of the Plan and which relates to the extent G
of the land sue or standards of population density."
12. It is not in dispute before us that the Development
Authority had finalized the Master Plan in accordance with the
provisions of the Act and the Regulations, which was titled as H
902 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A 'Master Plan, NOIDA, 2001'. This Plan is in force and is binding
on all concerned.
13. Besides the above provisions of the Act and the
Regulations framed thereunder by the Development Authority,
B the Development Authority has also framed building regulations
and directions, which are termed as The New Okhla Industrial
Development Area Building Regulations and Directions, 2006
(for short 'Regulations 2006)'. These have been primarily
framed as byelaws in relation to the constructions, restrictions
thereof and type of user. Under Regulation 3.12 (h), a
C residential building is explained as under: -
"(h) 'Residential building' refers to any building in which
sleeping accommodation is provided for normal residential
purpose with or without cooking or dining or both facilities
D and includes one or two or multi family dwelling, lodging
or rooming houses, dormitories, apartment houses, flats
and hostels."
14. In distinction to the 'residential building', an 'industrial
building' is the building or part thereof, in which product or
E materials of all counts and properties are fabricated,
assembled, manufactured etc. An 'institutional building' refers
to a building or a part of a building which is used for purposes
such as medical or other treatment or care of persons suffering
from physical or mental illness, disease or infirmity and includes
F hospital, institutions and sanitaria etc. while a 'business
building' refers to a building or part of a building which is used
for transaction of business like Banks, Commercial office, etc.
In other words, each building proposed to be used for a definite
purpose has to meet different standards, FAR (Floor Area
G Ratio) and byelaws. These purposes are incapable of being
confused with each other or even used interchangeably.
Respective purposes have been defined in unambiguous terms
in the byelaws, having distinct implications.
H 15. It does not appear to be the scheme of the provisions
R.K. MITIAL & ORS. v. STATE OF UTIAR PRADESH 903
& ORS. [SWATANTER KUMAR, J.]
of the Act, the Regulations and the bye laws, including the A
Regulations, 2006 that each of these purposes or buildings can
be understood or used interchangeably. In fact, each has
distinct features and it does not lie in the jurisdiction of the
Development Authority to permit such conversion in users,
beyond the scope of the Master Plan, the byelaws and the B
statutory provisions. Regulation 3.22 of the Regulations, 2006
explain the word 'conversion' to mean the change of an
occupancy or change in building structure or part thereof,
resulting into change of space or use requiring additional ·.
occupancy certificate. c
16. The change in user of the building is, therefore,
violative not only of the Regulations, byelaws and the provisions
of the Act, but is also contrary to the law governing erection of
the building. The legislative purpose that emerges from the
scheme of the Act and other relevant provisions is to keep a D
residential building separate from commercial and other
buildings. This would necessarily imply that the jurisdiction of
the Development Authority to permit different user in violation
of this statute and the Regulations is not contemplated in law.
E
Contentions
17. On behalf of the appellants/lessees/users, in the cases
before us, it has been contended that the activity of banking or
running of clinics is being carried on by them for a long period.
Thus, this has been impliedly permitted by the Development
F
Authority. It is also their contention that a public notice had been
issued by the Development Authority, permitting mixed user
and, thus, the appellants/lessees/users are bonafidely carrying
on activities of running banks/nursing homes/other commercial
activities in the residential sectors. Reliance has been placed G
upon Public Notice dated 30th March, 2000 and also that vide
notification dated 4th December, 2010 plots allotted in the
developed sector to farmers under a Rehabilitation Scheme
had permitted establishment of guest houses, restaurants,
H
904 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A banks, professional offices, day care centres etc. vide
notification dated 4th December, 2010.
18. It is also the contention of the appellants that neither
the byelaws, rules and regulations nor the layout plan of the
8 Development Authority, in any manner, impede or place any
kind of bar on carrying out banking activity in the residential
sectors.
19. While relying upon the judgments of this Court in the
case of Hari Rao Vs. N. Govindachari & Ors. [(2005) 7 SCC
C 643], and Dev Brat Sharma Vs. Jagjit Mehta [(1990) Supp.
sec 724], it was contended that s11ch use does not amount to
change of user as it is permissible to carry out professional or
clinical activity in the residential houses and, therefore, the
notice of termination issued and/or cancellation of the lease
D deeds, being arbitrary and without application of mind, was
vitiated in law.
20. Lastly, it was contended that as there is inadequacy
of space for banks, clinics and other commercial offices in the
E Development Area, the present user is need-based and is in
the larger public interest. According to the appellants, the
number of plots for the banks is not sufficient to meet the needs
of the public in the residential sectors and no alternative spaces
are available for relocation of the banks. The lease rent and
other charges payable to the Development Authority for both
F these categories have a considerable difference. Thus, it has
the impact of creating heavy liability and inconvenience to the
appellants, particularly if they are forced to shift to commercial
or institutional sectors/pockets. ·
G 21. On the contra, the contention on behalf of the
Development Authority is that banking activity is impermissible
in the residential sectors. It causes inconvenience to public and
disturbance to the residents. Referring to the Meeting dated
17th December, 2002 of the Committee of the Officers, the
H stand taken is that banking activity cannot be allowed in the
R.K. MITIAL & ORS. v. STATE OF UTTAR PRADESH 905
& ORS. [SWATANTER KUMAR, J.]
residential portions of the residentia! sectors and to this effect, A
a notice was also published.
22. Further, the contention is that the power of the
Development Authority to demarcate and develop sites, to lay
down the purpose for which a particular site or plot of land shall
B
be used, is controlled by the specific provisions of the Act and
the Regulations framed thereunder. Sections 6(2)(b) and 7 of
the Act are stated to be the source of power in this regard. It is
also the contention that in the Master Plan, 2001, subsequent
Plans and the Zoning Regulations, all residential sectors are
marked in yellow colour. Sector 19 of the Development Area, C
where the subject matter of this case is located, is a residential
sector. Thus, it can only be used for the residential purpose.
23. The learned counsel appearing for the lessee/
transferees had relied upon the judgments of this Court in the D
cases of Hari Rao (supra) and Dev Brat Sharma (supra). Both
these judgments have no application to the present case, on
facts or in law. These were cases of eviction under the
respective Rent Restriction Acts. In one case, this Court held
that putting up of a clinic in a part of the house by a doctor was E
not change of user, while in the other, where the premises had
been rented out for a commercial purpose of selling of leather
goods, change of the industry to a garment and cloth business,
was not considered as change of user. We are unable to
understand as to how the lessees in the present case can
F
derive any benefit from these judgments. In the present case,
we have a clear law in force and that law is neither similar in
purpose nor linguistically identical to the Rent Restriction Acts
of the respective States. The change of user, in the case in
hand, has to be seen in light of the Master Plan, the Regulations G
and the provisions of the Act. What may not be change of user
under the Rent Restriction Act, as the rights of the parties
therein are governed by the contract between the parties and
the grounds of eviction taken by them, may be a change of user
within the scope of development Plan and the Regulations.
H
·'
906 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A 24. In light of the contentions raised, first of all, it will be
appropriate for this Court to examine the scheme of the Act and .
the Regulations in question. Under the provisions of the Act,
the Development Authority is obliged to notify an industrial
development area. The very object of the Development
B Authority is to secure the planned development of the industrial
development area and the first and foremost step in this
direction is to prepare a Plan for development of the industrial
development area. This development Plan is to demarcate and
develop sites for industrial, commercial and residential
C purposes. The land which falls within the jurisdiction of the
Development Authority and is part of the development Plan can
be transferred in terms of Section 7 of the Act by auction,
allotment or otherwise, on such terms and conditions as the
Development Authority may state and subject to any rules that
may be made thereunder. No person can erect or occupy any
D building in an industrial development area in contravention to
any building Regulation. Under Section 6(2) of the Act, the
Development Authority is empowered to make Regulations to
regulate the erection of the buildings and Section 6(2)(b)
specifically authorizes the Development Authority to make
E regulation providing for the layout Plan of the building, whether
industrial, commercial or residential. The transfer of the land has
to be as per the terms and conditions contained in the lease
deed executed by the Development Authority in favour of the
transferee. But this all has to be subject to the provisions of the
F Act and the Regulations framed thereunder. It has to be clearly
understood that the lease deed has to be in consonance with
law and cannot be in conflict with the provisions of the law.
Section 14 of the Act empowers the Development Authority to
resume the site or building so transferred and further forfeit
G whole or any part of the money paid in respect thereof, if the
lessee commits breach of the terms and conditions of the lease.
No provision of the Act has been brought to our notice which
provides for the manner and method to be adopted by the
Development Authority for preparation of the development Plan
H in accordance wiit, the provisions of the Act. This is where the
'
R.K. MITTAL & ORS. v. STATE OF UTIAR PRADESH 907
& ORS. [SWATANTER KUMAR. J.]
Regulations come into play. Under Regulations 3 and 4 of the A
Regulations, the Draft Plan has to be prepared by the
Development Authority for development of an industrial area,
which will include a sector plan. The meaning of 'residential use'
under the Regulations is a restricted one and is incapable of
being given a wide connotation. It means the use of any land B
or building or part thereof for human habitation and such other
uses incidental to the residential use. The very language of
Regulation 2( 1)(k) of the Regulations clearly depicts the intent
of the framers that the expression 'residential use' is not to be
understood in its wider sense. in fact, it would require strict C
construction because all other uses have been separately
defined. The different kinds of uses, therefore, have to be
understood only in terms of the explanation or meaning given
to them under the Regulations. If unduly wide meaning is given
to the expression 'residential use', then it is bound to cause D
overlap between the other uses. It would cause unnecessary
confusion. Thus, each use has to be understood as per its plain
language and there is no need for the Development Authority
or, for that matter, even for the courts, to expand the meaning
given to such expressions. The expression 'such other use
incidental to residential use' in Regulation 2(1 )(k) has to take E
its colour from the use of the building for human habitation. In
other words, the latter part of the Regulation has to be read
ejusdem generis to the earlier part of that Regulation.
25. The development Plan has to be prepared in F
accordance with the provisions of the Act and the Regulations
framed thereunder. As already noticed, the Development
Authority has to prepare the Draft Plan, give public notice
thereof, invite objections and thereupon conduct an inquiry and
hearing as contemplated under the law, before preparing a final G
development Plan. This final development Plan is a statutory
requirement which has to be prepared as ordained under the
provisions of Section 6(2)(b) of the Act read with Regulations
5 to 11 of the Regulations. This Plan necessarily provides for
a particular use or purpose of any area/site, namely industrial, H
908 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A commercial institutional or residential. The notified development
Plan has a legal sanction and provisions contained therein are
mandatory in nature. They are incapable of being altered or
varied without following the due process prescribed in law.
Reference can be made to the judgment of this Court in the
B case of NO/DA Entrepreneurs Association v. NO/DA & Ors.
[(2011) 6 SCC 527]. Further, this Court, in the case of NDMC
& Ors. v. Tanvi Trading and Credit Private Limited and Ors.
[(2008) 8 sec 765], not only took the view that even the interim
guidelines issued in relation to Luytens' Building Zone till
C finalization of the Master Plan for Delhi would have statutory
force and be treated mandatory, but also that such guidelines,
so far as consistent with the Master Plan, would continue to be
binding even after coming into force of the Master Plan.
26. It has to be noticed at this stage that the development
D Plan prepared in accordance with the Regulations take the
statutory colour in terms of Section 6(2){b) of the Act and,
therefore, its alteration by an executive order would be
impermissible. Even when a Master Plan is to be amended,
the entire prescribed procedure must be followed. The power
E to amend should be exercised only in consonance with the
settled norms without going beyond the original power of the
Development Authority to make such Plan in accordance with
the provisions of the Act. The power to amend cannot be used
to frustrate the provisions of the statute. Regulations, being
F subordinate legislation must fall in line with the principal
provisions of the Act and in no way should be detrimental to
the provisions and the legislative scheme of the Act.
27. In the case of M.C. Mehta v. Union of India & Ors.
[(2004) 6 sec 588] dealing with the question of unauthorized
G industrial activity in residential area in Delhi, the plea raised for
in situ regularization of areas with 70 per cent industrial use
was not accepted by this Court, holding that regularization
would have adverse impact on the law abiders. This Court also ·
held that the land cannot be permitted to be used contrary to
H the stipulated user except by amendment of Master Plan, after
R.K. MITTAL & ORS. v. STATE OF UTTAR PRADESH 909
& ORS. [SWATANTER KUMAR, J.]
due consideration of the provisions of the Act and the Rules. A
Inaction by the Government authorities means permitting the
unauthorized use, contrary to law.
28. The authorities while reconsidering such matters are
expected to act reasonably and cautiously. They deal with
larger public interest and, therefore, have a responsibility to act B
with greater degree of sensitivity and proper application of
mind. If the Development Authority aids the violation of the
statutory provisions, it will be a perversity in the discharge of
statutory obligations on the part of the Development Authority.
The public interest, as codified in the statutory regulations and C
the provisions of the Act, should control the conduct cf the
Development Authority and its decision making process, rather
than popular public demand guiding the exercise of its
discretion, that too, in a somewhat arbitrary manner. To illustrate
the dimensions of exercise of such powers, we may refer to D
the judgment of this Court in the case of Bangalore Medical
Trust v. B.S. Mudappa & Ors. [(1991) 4 SCC 54], wherein this
Court was concerned with the provisions of the Bangalore
Development Authority Act, 1976 with particular reference to
Sections 33, 38 and 38(A) of that Act. A site intended for a E
public park was sought to be converted into a hospital/nursing
home, under the garb of the latter being a 'civic amenity'. This
Court formed the view that such conversion of an open space
reserved under the scheme for a public park into a civic amenity
site by constructing hospital and allotment of the site to persons F
or body of persons, was opposed to the objects of the Act and
would be ultra vires the same. This Court held as under:-
"46 ........ No one howsoever high can arrogate to himself
or assume without any authorisation express or implied in
law a discretion to ignore the rules and deviate from G
rationality by adopting a strained or distorted interpretation
as it renders the action ultra vires and bad in law. Where
the law requires an authority to act or decide, 'if it appears
to it necessary' or if he is 'of opinion that a particular act
H
910 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A should be done' then it is implicit that it should be done
objectively, fairly and reasonably. Decisions affecting
public interest or the necessity of doing it in the light of
guidance provided by the Act and rules may not require
intimation to person affected yet the exercise of discretion
B is vitiated if the action is bereft of rationality, lacks objective
and purposive approach. The action or decision must not
only be reached reasonably and intelligibly but it must be
related to the purpose for which power is exercised. The
purpose for which the Act was enacted is SJ.lei! out from
the Preamble itself which provides for establishment of the
c Authority for development of the city of Bangalore and
areas adjacent thereto. To carry out this purpose the
development scheme framed by the Improvement Trust
was adopted by the Development Authority. Any alteration
in this scheme could have been made as provided in sub-
D section (4) of Section 19 only if it resulted in improvement
in any part of the scheme. As stated earlier a private
nursing home could neither be 'considered to be an
amenity nor it could be considered improvement over
necessity like a public park. The exercise of power,
E therefore, was contrary to the purpose for which it is
conferred under the statute."
29. The above decision of the Court was given in light of
the provisions of Section 19(4) of that Act whicti empowered
F 1 the Authority to alter the scheme, where it appeared to the
Authority that an improvement could be made in the scheme.
In other words, the power given to the Authority has to be
construed in strict terms and it cannot be exercised in a
manner which will run contrary to the scheme of the Act and
G which/ would defeat the very object of the Act and the
Regulations.
30. The jurisdiction of the Development Authority has to be
seen on the touchstone of proper exercise of power within its
legal limitations while giving full effect to the statutory provisions.
H
R.K. MITIAL & ORS. v. STATE OF UTIAR PRADESH 911
& ORS. [SWATANTER KUMAR, J.]
This Court in the case of S.N. Chandrashekar & Anr. v. State A
of Karnataka & Ors. [(2006) 3 SCC 208], referred with approval
to judgments of the High Courts, applying the rule of strict
construction to the terminology used and while interpreting the
words 'commerce' and 'commercial' held that intra category
changes could be permitted only in accordance with law and 8
Section 14-A of that Act. Even if the change of user is
consented to by the residents of the area, it would be no ground
to permit such a change in violation of the Regulations. This
Court stated the law as follows:-
"27. The Planning Authority has no power to permit change C
in the land use from the Outline Development Plan and the
Regulations. Sub-section (1) of Section 14, as it then
existed, categorically stated, that every change in the land
use, inter alia, must conform to the Outline Development
Plan and the Regulations which would indisputably mean D
that it must conform to the Zoning Regulations.
28. The provisions of the Act are to be read with the
Regulations, and so read, the construction of Sections 14
and 15 will l~ad to only one conclusion, namely, such E
changes in the land use must be within the Outline
Development Plan and the Zoning Regulations. If running
of a hotel or a restaurant was not permissible both under
clauses (a) and (b) of the Zoning Regulations in a
residential area, such change in the land use could not
F
have been permitted under Section 14 read with Section
15 of the Act. It is precisely for that reason, Section 14-A
was introduced."
31. Even in the case of ITC Ltd. v. State of Uttar Pradesh
& Ors. [(2011) 7 SCC 493], this Court declined to accept the G
contention that where the State Government had treated the
hotels as an 'industry' even in such cases, the same could not
be treated as· 'industry' under the Act because the byelaws
continued to treat the hotels to be a commercial activity and
that haa alone covered such industry. This Court held as under:- H
912 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R
A "38. The learned counsel for the respondents submitted
that the lease was terminated by the State Government,
in exercise of revisionai jurisdiction under Section 41 of
the U.P. Urban Planning and Development Act, 1973 read
with Section 12 of the Act on the ground that there were
8 irregularities and violations of regulations and policies of
Noida Authority in allotting the hotel plots to the appellants.
It is submitted that the State Government has such power
to cancel the allotment and as a consequence the lease."
32. Reference can also be made to the judgment of this
C Court in Dr. G.N. Khajuria & Ors. v. Delhi Development
Authority & Ors. [(1995) 5 SCC 762]. In that case, the Plan had
provided for a public park and the Delhi Development Authority
had taken the decision to establish a nursery school for the
benefit of the children of the colony. Rejecting the contention,
D this Court observed that within the framework of law and the
provisions made in the Master Plan, the authorities could only
establish a public park and nothing else, as such conversion
would amount to misuse of power.
E 33. All the above judgments clearly show that it is not
merely at the discretion of the Development Authority concerned
to designate user of a site and then alter the same without
following due process of law. Even where such an exercise is
required to be undertaken by the Development Authority, there
F also it is expected of the Development Authority to act for the
betterment of the public and strictly in accordance with the Plans
and the statutory provisions. It cannot take recourse to its
powers and use its discretion contrary to such provisions and
that too, to frustrate the very object of the Act. Exercise of power
G ought not to be destructive of the provisions of the Act and the
Plans, having the force of law. We would hasten to add that
even where the requisite prescribed procedure is followed, still
the discretion should be exercised sparingly for achieving the
object of the statute and not to completely vary or destruct the
purpose for which the sector has been earmarked.
H
R.K. MITTAL & ORS. v. STATE OF UTIAR PRADESH 913
& ORS. [SWATANTER KUMAR, J.]
34. A decision which is sought to be taken by the A
Development Authority in the garb of a policy decision matter,
if not in conformity to the Master Plan, the Regulations and
provisions of the Act in force, would be an action extra }us. The
Development Authority is to act in adherence to the provisions
of the law regulating such user or construction. The laconic 8
result of a collective reading of the afore-referred statut0ry
provisions is that the Development Authority or its officers, have
no power to vary the user and spaces prescribed in the Master
Plan, except by amending the relevant laws and that too, for a
proper object and purpose. Any decision, as a policy matter C
or otherwise, for any extent of public convenience, shall be
vitiated, if it is not supported by the authority. The Courts would
examine what is the sensible way to deal with this situation, so
as to give effect to the presumed purpose of the legislation. The
provisions in question should be construed on their plain
reading, supporting the structure of the legislative intent and its D
purpose. The rule of schematic interpretation would come into
play in such situations and the concerned Development
Authority cannot be permitted to overreach the procedure
prescribed by law, with designs not acceptable in law.
E
35. The Development Authority is inter alia performing
regulatory functions. There has been imposition of statutory
duties on the power of this regulatory authority exercising
specified regulatory functions. Such duties and activities should
be carried out in a way which is transparent, accountable, F
proportionate and consistent. It should target those cases in
which action is called for and the same be exercised free of
arbitrariness. The Development Authority is vested with drastic
regulatory powers to investigate, make regulations, impute fault
and even to impose penalties of a grave nature, to an extent G
of cancelling the lease. The principles of administrative justice
squarely apply to such functioning and are subject to judicial
·review. The Development Authority, therefore, cannot
transgress its powers as stipulated in law and act in a
discriminatory manner. The Development Authority should H
914 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A always be reluctant to mould the statutory provisions for
individual, or even public convenience as this would bring an
inbuilt element of arbitrariness into the action of the authorities.
Permitting mixed user, where the Master Plan does not so
provide, would be glaring example of this kind.
B 36. In the case of Shabi Construction Company v. City &
Industrial Development Corporation & Anr. [(1995) 4 SCC
301], this Court held that, prior sanction of the State
Government being the sine qua non for a final development
Plan, as also for minor modifications thereof, under Sections
C 31 and 37 of the Maharashtra Regional and Town Planning Act,
1966, the agreement entered into with the Planning Authority
so far as it relates to increased Floor Space Index (FSI) did
not and could not bestow any legal right upon the appellant. To
put ii conversely, only on sanction by the State Government,
D could the inchoate right under the agreement crystallize into a
~egally enforceable right in favour of the appellant.
37. Still, in another case of K.K. Bhalla v. State of MP. &
Ors. [(2006) 3 SCC 581], this Court did not approve and attach
E any validity to the action of the Chief Minister directing and
calling for a proposal from the said Development Authority to
make allotment for development of an industrial area on
concessional terms and held that the purpose for which the
allotments were made might be well-meaning, but the
F allotments, being contrary to the mandatory provisions of the
Act and the Rules were void and of no effect, being illegal.
38. Similarly, in the present case, the action of the
Development Authority in permitting mixed user was in apparent
violation of the statutory provisions in the Master Plan.
G
39. Establishment of banks and nursing '-omes in the
residential sectors meant for residential use alone is
unequivocal violation of the statutory provisions in the Master
Plan.
H
R.K. MITIAL & ORS. v. STATE OF UTIAR PRADESH 915
& ORS. [SWATANTER KUMAR, J.]
40. Reverting to the case in hand, we may notice that the A
lease deed executed in favour of the predecessor-in-interest
of R.K. Mittal and the other appellants had contained specific
stipulations that the lessee will obey and submit to all directions
issued, existing or thereafter to exist, as obeyed by the lessor.
The erection of the structure was also to be in accordance with B
the approved plans. Clause (h) of the lease deed specifically
provides that the constructed building shall be used only for the
purpose of residential, residential-cum-medical or surgical
clinic and for no other purpose, that too subject to such terms
as are imposed by the lessor. c
41. The transfer deed which was executed in favour of the
present appellants, with the approval of the Development
Authority, also contained similar clauses and also provided that
the terms and conditions imposed by Development Authority
from time to time shall be binding on the transferee. Clause 15 D
of the transfer deed stipulated that the transferee shall put the
property to use exclusively for residential purpose and shall not
use it for any purpose other than residential. After raising the
construction on the plot in question, admittedly, the appellants
have put the property to a different use other than residential. E
The property was rented out to two different commercial
undertakings, i.e., Andhra Bank and a company by the name
'Akariti lnfotech'. It is not even the case of the appellants before
us that the Development Authority had granted any specific
pennission to them to use the property for any purpose other F
than residential.
42. The appellants, in fact, have relied upon an agenda
note where there was a proposal put forward by the
Development Authority to grant permission for nursing home, G
guest house, lodging house, banks etc. on a 100 metres wide
road on such terms and conditions as may be imposed by the
Development Authority. This also provided for levying certain
additional charges for granting such permission. Based on this
proposal, it is stated that a public notice was issued and H
objections were invited.
916 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A 43. The matter rested at that. This was not finalized. In other
words, no final decision was taken by the Development
Authority in consonance with the provisions of the Act to permit
such user in the residential sector. We, in fact, are unable to
understand why such action was initiated by the authorities
B concerned, in face of the statutqry provisions of the Act,
Regulations and the Master Plan in force. It is a settled position
of law that no authority can exercise the power vested in it,
contrary to law. In the present case, there appears to be no
proper data collected or study carried out by the Development
c Authority even for mooting such a proposal, much less amending
the Plan or the Regulations. It is a matter of regret that the
Development Authority is dealing with such serious matters in
such a casual manner. Either way, this certainly affected the
rights of the parties adversely. It is not only the rights of
D individuals which are to be examined by the authorities
concerned, but also the effect of such amendment on the
residential sector as a whole which is one of the relevant factors
to be considered.
44. The running of a bank or a commercial business by a
E company in the residential sector is certainly not permissible.
In fact, it is in patent violation of the Master Plan, Regulations
and the provisions of the Act. We see no power vested in the
Development Authority to permit such user and ignore the
misuse for such a long period.
F
45. We may notice that only in two cases i.e. Oriental Bank
of Commerce (Sector 27, Naida) and Vijaya Bank (Sector-19,
Naida), the permission for running a bank in the residential
sector was granted for a period of five years and three years,
G respectively. This permission came to end few years back and
was admittedly never renewed or extended. Even this initial
grant of permission is a case of lack of legal authority and is
contrary to the provisions of law. It is not the_ case of anyone
before us that the Development Authority had granted
permission for rJnning a bank/commercial activity or nursing
H
R.K. MITIAL & ORS. v. STATE OF UTIAR PRADESH 917
& ORS. [SWATANTER KUMAR, J.]
home in the residential sector. A survey had been conducted A
under the orders of the Court dated 3rd March, 2011. As per
this survey, a number of banks and nursing homes were being
run in the residential sector, which was not permissible.
46. The conduct of the authorities, prior to institution of the
writ petitions in the High Court, showed uncertainty and B
wavering of mind in its decision-making processes. In fact, it
was expected of the Development Authority to take a firm and ·
final decision and put at rest the unnecessary controversy raised
by its proposal. However, once the writ petitions were filed,
thereafter, the stand of the Development Authority has been C
consistent and unambiguous. In the counter affidavit filed in this
Court, it has been stated that even in case of grant of
permission to the above stated two banks, no extension was
granted and in fact show cause notices have been issued to
all the banks in the residential sector to wind up their activities D
and move out of the residential sector. It is the definite case of
the Development Authority that banking activity is a commercial
activity and therefore, cannot be carried on in the residential
sector, more particularly on the plots in question. In regard to
Sector 19, a specific averment has been made in the affidavit E
of the Development Authority that the land use is residential
alone and is neither commercial nor mixed. As per the Master
Plan, its primary use is 'residential' where plots are planned
for residential purpose alone. It is, therefore, abundantly clear
from the pleadings on record that commercial activity of any kind F
in the residential sector is impermissible. These pleadings are
in conformity with the statutory provisions and the Master Plan.
47. All the cases where banks, nursing homes or any
commercial activity is being carried on, particularly like the
appellants' case, where a bank and company are running their G
offices in the residential sectors would amount to change of
user and thus be impermissible. The officers of the
Development Authority should refrain from carving out
exceptions to the implementation of the Master Plan and the
H
918 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A Regulations in force, that too without the authority of law. For
taking up any exercise for change of user or such similar
conditions, amendment to the relevant Regulations, Master
Plan and if needed, the provisions of the Act, is a condition
precedent. It should be ensured that such exercise would further
B the cause and object of the Act and would not be destructive
to the scheme of the development. We have no hesitation in
our minds in holding that no such jurisdiction or authority vests
in the officers of the Development Authority to permit change
of user in its discretion and in violation of the law in force.
C 48. Another important aspect is that the Development
Authority had taken a policy decision and had earmarked
specific areas where land was made available to the banks to
carry on their commercial activities in the commercial pockets
of the industrial or institutional sectors. This land was being ·
D provided at a concessional rate and a number of banks had
taken advantage of this scheme to get the lands allotted to them
in the appropriate sectors. They have been given lands in the
commercial and even in the commercial pockets of the
industrial or institutional sector. However, the 21 banks
E functioning in the residential sectors have not even opted to
apply under the said scheme. If they would apply, the
Development Authority has taken onto itself to consider the
same sympathetically. This Scheme was opened on 20th June,
2011 and closed on 11th July, 2011. 26 commercial plots were
F offered for allotment under this Scheme in different sectors and
plots were even reserved to be used as banks. In other words,
the Development Authority has provided due opportunity to
these banks to shift their activities to the appropriate sectors,
however, to no effect. Despite issuance of show cause notices
G and offer to allot alternative plots, the unauthorized use by the
appellant - banks and nursing homes have persisted in the
residential sectors.
49. Another case which is required to be noticed by us
from amongst the number of cases listed, is the case of
H
R.K. MITIAL & ORS. v. STATE OF UTIAR PRADESH 919
& ORS. [SWATANTER KUMAR, J.]
•
Chairman and Chief Executive Officer, New Okhla Industrial A
Development Authority & Anr. v. Mange Ram Sharma & Anr.,
SLP (C) No. 24029/2005. In this case, according to the
Development Authority, the lessee is running a 20 bedded
hospital with all modern and diagnostic facilities, admitted by
the lessee and his family members in a letter Annexure P-7 to B
the authorities. In this letter they had claimed that the hospital
is being run from the premises in question and hac! all the
modem facilities. However, these facts are not admitted by the
lessee who have tried to explain that letter by stating that in a
three-storeyed building of 400 square metres, they are carrying C
on professional activity of medical consultancy only in an area
of 28.42 square metres on the ground floor and rest of the
premises is being used entirely for residential purposes. It is
also denied that any hospital is being run from the premises.
According to them, the order dated 15th October, 1994
0
tenninating the lease is contrary to law and they have also
submitted an undertaking that the premises will not be used for
any purpose other than residential. According to the applicant/
respondent in terms of the lease deed, such a user is
pennissible. The respondents being doctors, are carrying out
their professional activity in a limited portion and as such, they E
have also placed on record a list of hospitals being operated
from residential block.s which have even been empanelled by
the appellant Development Auth<;>rity. The Development
Authority is acting arbitrarily and not taking any action against
those persons, though they have executed the lease deed with F
the same terms and conditions as the appellant's. In this case,
this Court had appointed a local Commissioner to visit the
premises. As per report of the Commissioner dated
20thSeptember, 2003, the premises in question is a corner plot
in front of 30 metres wide road and had tWo gates. There is a G
sign board displaying 'Sharma Clinic and Medical Surgical
Centre'. Names of the doctors have also been displayed on the
sign boards on the boundary wall. There is a reception counter
which is attended to by a nurse. On ground floor, the basement
was still under construction. Major part of the ground floor was H
920 SUPREME COURT REPORTS [2011L15 (ADDL.) S.C.R
. A being used as medical clinic. There were four cabins used by
different doctors of different specialties. The first floor is being
used for residential purposes. The second floor is being partly
used for residential purposes while there is also an office on
that floor. None of the parties had filed objections to this report
B of the Local Commissioner and; therefore, there is no reason
for us not to accept the same. Even as per the report of the
Local Commissioner, the house is being used for medical-cum-
surgical clinic and is not merely a consultant's clinic. Use of a
major part of the ground floor for running the medical centre
C obviously is not permissible in accordance with the provisions
of the Act and the Regulations. The Development Authority is
expected to take proper action at the earliest. Even if we reject
the case of the appellant Development Authority that a 20 '
bedded hospital is being run from the premise, still the fact
stands established on record that practically the entire ground.
[} floor and part of the second floor is being used for activities
other than residential.
50. According to the respondents, they had not been
served with the show cause notice, though according to the
E appellant, show cause notice dated 29th August, 1992 was
issued and thereafter, the order of termination/cancellation of
lease had been passed against the respondents. This order
had been set aside by the High Court and the Development
Authority has come up in appeal before this Court.
F
51. In the light of what we have discussed above, even on
facts of this case, running of a hospital or even a medical clinic
of this dimension cannot be permitted in a residential area. It
would be different if a doctor uses permissible part pf the
premises for clinical purposes i.e. to meet or exaf'!li~e his
G patients in any portion. For surgery or specific treatments', such
patients would have been addressed to proper nursing homes
or regular hospitals. Therefore, doctors cannot carry on, in the
garb of a medical clinic, a regular medical and surgical activity
on a commercial scale. Thus, we find that action of the
H
R.K. MITIAL & ORS. v. STATE OF UTIAR PRADESH 921
& ORS. [SWATANTER KUMAR, J.]
Development Authority was justifiable. A
52. One of the allegations against the Development
Authority is that they have acted arbitrarily and discriminatorily
in issuance of notices, in passing of orders of cancellation of
the lease deed and/or even in imposing other restrictions in
8
relation to the properties in question. It is their contention that
commercial activity, nursing homes and banks are operating
in a large number of residential houses but the Development
Authority has adopted a policy of pick and choose and has not
acted uniformly even in that regard. Certain instances have been
mentioned. Instances of banks have been mentioned in the C
case of R.K. Mittal (supra), while nursing homes have been
mentioned in the case olMange Ram (supra). We are unable
to grant approval to this discriminatory policy of the
Development Authority. They are _expected to act fairly and
judiciously in such matters. The action of the Development D
Authority should be free of arbitrariness and must be applied
uniformly. The ground of legitimate expectation taken by the
lessees on the premise that public notice had been issued by
the Development Authority proposing to permit mixed user in
the residential sector binds the Authority. Firstly, the action of E
the Development Authority in issuing the notices is not in
accordance with law. Secondly, this argument is without any
substance and is misconceived. The doctrine of reasonable
expectation has no applicability to the present case and there
cannot be any waiver of statutory provisions as well. The user F
of a sector is provided under the Master Plan and in furtherance
to Regulations and the provisions of the Act. It is incapable of
being administratively or executively altered. The lessees, who
have changed the user contrary to Jaw, are liable to be
proceeded against as per the terms of the lease deed and the G
provisions of the Act.
53. The Master Plan and the Zonal plan specify the user
as residential and therefore these plots cannot be used for any
other purpose. The Plans have a binding effect in .law. If the
scheme/Master Plan is being nullified by arbitrary acts and in H
922 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A excess and derogation of the power of ihe Development
Authority under law, the Court will intervene and would direct
such authorities to take appropriate action and wherever
necessary even quash the orders of the public authorities. This
Court in the case of K. Ramadas Shenoy v. Chief Officer,
B Town Municipal Council, Udipi and Others [(1976) 1 SCC 24)
was concerned with the resolution of the Municipal Committee
to construct a cinema theatre at place where earlier the
permission was granted for construction of Kalyan Mandarr
cum-Lecture Hall and the contention before the Court was that
c town planning scheme forbade any cinema building at the place
asked for and therefore, the resolution of the committee was
invalid. This Court accepted the contention and while setting
aside the resolution observed that an illegal construction of a
cinema building materially affected the right to enjoyment of the
0 property of the persons residing in the residential area and
there being unauthorized construction, the Court would intervene
and quash the resolution of the Municipality. This view was
followed in the case of M.I. Builders v. Radhey Shyam Sahu
((1999) 6 SCC 464), wherein this Court even directed
demolition of unauthorized constructions. At this stage, we may
E also refer to the judgment of this Court in the case of Virender
Gaur & Ors. v. State of Haryana & Ors. [(1995) 2 SCC 577],
wherein this Court was concerned with the issue whether
Dharmshala should be permitted to be constructed upon the
land which was reserved as open space undtr the plan. This
F Court, while noticing the impact on environment, right to
hygienic environment and protection of the residents, observed
as under:-
"11. It is seen that the open lands, vested in the
G Municipality, were meant for the public amenity to the
residents of the locality to maintain ecology, sanitation,
recreation, playground and ventilation purposes. The
buildings directed to be constructed necessarily affect the
health and the environment adversely, sanitation and other
H effects on the residents in the localify. Therefore, the order
R.K. MITIAL & ORS. v. STATE OF UTTAR PRADESH 923
& ORS. [SWATANTER KUMAR, J.)
passed by the Government and the action taken pursuant A
theret(}by the Municipality would clearly defeat the purpose
of the scheme. Shri D.V. Sehgal, learned Senior Counsel,
·again contended that two decades have passed by and
that, therefore, the Municipality is entitled to use the land
for any purpose. We are unable to accept the self- 8
destructive argument to put a premium on inaction. The
land having been taken from the citizens for a public
purpose, the Municipality is required to use the land for the
protection or preservation of hygienic conditions of the
local residents in particular and the people in general and C
not for any either purpose. Equally acceptance of the
argument of Shri V.C. Mahajan encourages pre-emptive
action and conduct, deliberately chartered out to frustrate
the proceedings and to make the result fait accompli. We
are unable to accept the argument of fait accompli on the D
touchstone of prospective operation of our order."
54. An ancillary question that comes up for consideration
is as to how much area can be permitted to be used by a
doctor to run his clinic or by a lawyer or architect to run their
offices in the residential sector. If other conditions are satisfied, E
then as the law stands today, according to the Development
Authority, they can be permitted to use 30 per cent of the Floor
Area Ratio (FAR) of the ground floor for their clinics/offices.
Reference can also be made to the judgment of this Court in
the case of Delhi Pradesh Citizen Council Vs. Union of India F
& Anr. [(2006) 6 SCC 305) wherein similar directions were
issued. We are not only relying upon the precedents of this
Court, but such an approach would also be permissible in face
of the Regulations, terms and conditions of the lease deed
executed by the parties and the Master Plan. It would, therefore, G
be suffice if 30 per cent of the ground floor area is permitted
to be used for office of an architect/lawyer and for clinic
simplicitor by a doctor.
55. From the above dictum of this Court, it is clear that
H
924 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A environmental impact, convenietrce of the residents and
ecological impact are relevant considerations for the Courts
while deciding such an issue. The law imposes an obligation
upon the Development Authority to strictly adhere to the plan,
regulations and the provisions of the Act. Thus, it cannot ignore
8 its fundamental duty by doing acts impermissible in law. There
is not even an iota of reason stated in the affidavits filed o~
behalf of the Development Authority as to why the public notice
had been issued without amending the relevant provisions that
too without following the procedure prescribed under law. The
C concept of public accountability and performance of public
duties in accordi;mce with law and for the larger public good
are applicable to statutory bodies as well as to the authorities
functioning therein. We find no justification, whatsoever, for the
respondents to act arbitrarily in treating equals who are similarly
placed as unequals. There is also no justification for the
D Development Authority to issue a public notice in the "fashion
in which it has done. A few officers of the Development Authority
cannot collectively act in violation of the law and frustrate the
very object and purpose of the Master Plan in force,
Regulations and provisions of the Act.
E
56. For the reasons afore-recorded, we would dispose of
the appeals of the Development Authority, the appellants/
occupiers/ lessees, interveners and occupants in the following
terms:-
F
1. That banking or nursing homes or any other
commercial activity is not permitted in Sector 19
and for that matter, in any sector, in the
Development Area earmarked for 'residential use'.
G 2. That the 21 banks and the nursing homes, which are
operating in Sector 19 or any other residential
sector, shall close their activity forthwith, stop
misuse and put the premises to residential use
alone, within two months from the date of
H pronouncement of this judgment.
R.K. MITIAL & ORS. v. STATE OF UTTAR PRADESH 925
& ORS. [SWATANTER KUMAR, J.]
3. That lessees of the plots shall encure that the A
occupant banks, nursing homes, companies or
persons carrying on any commercial activity in the
residential sector should stop such activity and shift
the same to the appropriate sectors i.e.
commercial, commercial pockets in industrial/
8
institutional area and specified pockets for
commercial use within the residential sector, strictly
earmarked for that activity in the development Plan,
Regulations and provisions of the Act.
4. That the Development Authority shall consider the C
request for allotment of alternative spaces to the
banks and the persons carrying on other
commercial activities, with priority and
expeditiousness.
D
5. That the Doctors, Lawyers and Architects can use
30 per cent of the area on the ground floor in their
premises in residential sector for running their
clinics/offices.
6. That for such use, the lawyers, architects and E
doctors shall be liable to pay such charges as may
be determined by the Development Authority in
accordance with law and after granting an
opportunity of being heard. The affected parties
would be at liberty to raise objections before the F
Development Authority that no charges are payable
for such users as per the law in force.
7. In the event the lessee or the occupant fails to stop
the offending activity and/or shift to alternate
premises within tf:te time granted in this judgment. G
The Development A4thority shall seal the premises
and proceed to can~~he lease deed without any
further delay, where it has not already cancelled the
lease deed.
H
926 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R
A 8. Wherever the Development Authority has already
passed the orders cancelling the lease deeds, such
orders shall be kept in abeyance for a period of two
months from today. In the event the misuse is not
stopped within a period of two months in terms of
B this judgment, then besides sealing of the
premises, these orders of cancellation shall stand
automatically revived and would come into force
without further reference to any Court. In the event
the misuse is completely stopped in all respects,
the orders passed by the authorities shall stand
c quashed and the property would stand restored t<
the lessees.
9. These orders shall apply to all cases, where the
order of termination of lease has been passed by
D the Development Authority irrespective of whether
the same has been quashed and/or writs of the
lessees dismissed by any Court of competent
jurisdiction and even if such judgment is in appeal
before this Court.
E 10. The orders in terms of this judgment shall be
passed by an officer not below the rank of
Commissioner. This order shall be passed after
giving an opportunity to the parties of being heard
by such officer. This direction shall relate only to the
F determination of charges, if any, payable by the
lessee or occupant for the period when the
commercial activity was being carried on in the
premises in question.
G 57. The appeals are disposed of in the above terms, with
no order as to costs.
B.B.B. Appeals disposed of.
H
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