1

AFR

Reserved

Case :- WRIT - C No. - 54063 of 2017

Petitioner :- Ahsan Karim Khan

Respondent :- State Of U. P. And Others

Counsel for Petitioner :- Udit Chandra

Counsel for Respondent :- C.S.C., Dhananjay Awasthi

Hon'ble Pradeep Kumar Singh Baghel,J.

Hon'ble Rohit Ranjan Agarwal,J.

(Delivered by Hon. Pradeep Kumar Singh Baghel,J.)

The writ jurisdiction of this Court under Article 226 of the

Constitution is invoked against the order dated 26/28.08.2017 passed by

respondent no.4, whereby the petitioner's allotment of the plot for

commercial purpose has been cancelled and the amount deposited by him

has been returned.

A brief reference to the factual aspects would suffice.

The Gorakhpur Industrial Development Authority, Gorakhpur

1

, the

respondent no.2, issued an advertisement on 22.07.2014 inviting

applications for allotment of 26 vacant industrial plots of different sizes in

Industrial Area, Gorakhpur. Pursuant to the said advertisement the

petitioner made an application on 19.08.2014 for allotment of an

industrial plot of an area of 9000 square meters in Sector-13 or in any

other sector.

The respondent no.2 vide a communication letter dated 30.08.2014

informed the petitioner that for allotment of the said plots an Allotment

Committee has been constituted and he was asked to appear before the

Allotment Committee for his interview. The interview was held on

28.01.2015. The petitioner was issued an allotment letter dated

31.03.2015, whereby he was allotted Plot No. F-5 in Industrial Sector-15.

The area of the plot is 6733 square meter.

On 01.01.2016 the petitioner was called upon to deposit a sum of

1GIDA

2

Rs.19,02,570/-. The said amount was deposited by the petitioner on

15.01.2016. By a notice dated 03.02.2016 the petitioner was asked to

deposit maintenance fee as well as lease rent.

It is stated in the petition that in the meantime after the allotments

were made, complaints were made to various authorities in respect of the

irregularity in the allotment of the plots including the Commissioner of

the Division, who set up an enquiry on 02.11.2015. The enquiry report

was placed before the GIDA and which resolved to stay the allotment

proceedings and to cancel all the allotments. It also appears from the

materials on record that serious complaints regarding the irregularity

committed by the Chief Executive Officer

2

and the Manager (Property) of

the GIDA were made. Pursuant to the said complaint a preliminary

enquiry was made and it was forwarded to the State Government and on

the basis of the report dated 28.12.2015 the State Government passed an

order dated 19.02.2016 to initiate disciplinary proceedings against the

erring officials.

In compliance of the order of the State Government the two

delinquent officers, namely, Gyan Prakash Tripathi and Anil Kumar Singh

preferred a writ petition, being Service Bench No. 5769 of 2016, Gyan

Prakash Tripathi and another v. State of U.P. and others, in this Court at

Lucknow Bench to challenge the disciplinary proceedings amongst other

grounds that enquiry officers are junior to the petitioners therein. The

order passed by the Court on 16.03.2017 reads as under:

“The petitioner has assailed the order dated 19

February 2016 passed by the State Government,

whereby the State Government has taken a decision to

issue a charge sheet against the petitioner on the basis

of inquiry report submitted by two members of fact

finding enquiry committee.

Learned Counsel for the petitioner has submitted that

the said committee was constituted with the two

officers who had been juniors to the petitioner that too

on the basis of complaint made by the District General

2CEO

3

Secretary, Samajwadi Party, Gorakhpur. It has been

submitted that the said complaint has not been made

by any public representative rather it is based on the

political party politics which may not be the basis for

an inquiry.

The petitioner has also brought on record the said

inquiry report. Since the inquiry report has reported

some irregularities in allotment of plots, therefore, we,

suo motu permit the respondents to inquire the matter

by some senior officers independently and the report

submitted by those officer would only be the basis for

further action.

With the aforesaid liberty the order impugned dated 19

February 2016 is hereby quashed.

The writ petition stands disposed of.”

Similar complaints were made to the Lokayukta, U.P., Lucknow in

respect of the same allotment. The Lokayukta appointed Commissioner,

Consolidation Department, U.P., Lucknow as enquiry officer on

29.04.2016, and on 27.05.2016 the General Manager (Finance), GIDA

was nominated as Nodal Officer to assist the enquiry officer in the

enquiry. While the said enquiry was pending, the GIDA, the respondent

no.2 in its 47

th

Board Meeting held on 18.06.2016 considered the report

dated 28.12.2015 and took a decision to cancel all the allotments made by

the GIDA in pursuance of the advertisement dated 22.07.2014.

It is averred in the petition that on 26.09.2016 the enquiry officer

appointed by the Lokayukta submitted a report to the State Government.

In the said enquiry report it was recorded that the respondent no. 2 has

advertised only 26 plots but it has allotted 83 plots. The report further

recorded that no fresh advertisement was issued nor fresh applications

were invited for the allotment of more than 26 plots. It is mentioned in

the report that for the allotment of extra 57 plots advertisement should

have been issued. A copy of the enquiry report is on the record.

The Board of the respondent no.2 in its meeting dated 18.06.2016

resolved to cancel all the 26 allotments for the reason that in the

advertisement the applications were invited for allotment of only 26 plots

4

but 83 industrial plots were allotted. Thus, the financial interest of

respondent no.2 was unsecured.

Consequently, the petitioner's allotment was cancelled vide order

dated 28.08.2017 and the amount deposited by the petitioner has been

returned. It is stated that the Lokayukta has not taken any decision on the

basis of the report dated 29.06.2016.

An amendment application has been filed whereby the petitioner

has brought on record the copy of the allotment letter and the proposed

lay out plan.

A counter affidavit has been filed on behalf of respondent nos. 2 to

4. The stand taken by the respondent no.2 is that an advertisement dated

22.07.2014 was issued for the allotment of 26 industrial plots in Sector 13

and 15. The complaints were made in respect of various illegalities in the

allotment. The Commissioner, Gorakhpur Division set up an enquiry vide

order dated 02.11.2015. The enquiry report pointed out several serious

illegalities in the allotment process. The said report and this matter were

considered by the Board of GIDA in its 46

th

meeting held on 11.02.2016.

It was resolved, “all further activities regarding allotment of the above

mentioned plot should be stopped and status quo should be maintained

and the allotment of plots be cancelled.”. The said report was sent to the

State Government, which recommended initiation of the disciplinary

proceedings against two officers, i.e., CEO and Manager (Property) of

the GIDA.

In the meantime, the Lokayukta on the basis of some complaints

asked the State to get an enquiry conducted from some State Officers.

Thereafter the Commissioner, Consolidation, U.P., Lucknow has been

appointed as enquiry officer. He was earlier CEO of the GIDA in the

past. The report of the enquiry officer was sent to the State Government

which vide order dated 25.04.2017 directed the GIDA Board to consider

and take decision whether the existing allotment should be cancelled and

5

re-allotment will be done or not. The GIDA Board in its 50

th

Board

Meeting held on 07.06.2017 considered the letter of the State Government

dated 25.04.2017 and it was decided to cancel allotment of all the 83 plots

on the ground of various anomalies which were pointed out in the two

separate enquiry reports. It is stated that the petitioner was allotted a plot

but the allotment never progressed beyond the stage of allotment letter.

The lease-deed was never executed in favour of the petitioner, hence, the

petitioner cannot claim a right on the basis of allotment of the plot. It is

stated that 83 plots have been cancelled due to illegality committed in the

allotment, which is in contravention of the rules, which is apparent from

the minutes of the 46

th

Board Meeting held on 24.02.2016 and 47

th

meeting held on 18.06.2016 (Annexure-CA-1 to the counter affidavit).

The same minutes have also been annexed by the petitioner as Annexure-

11 to the writ petition.

A rejoinder affidavit has been filed wherein the averments made in

the writ petition are reiterated.

Learned counsel for the petitioner submits that there is violation of

principle of natural justice. The petitioner was allotted plot on 31.03.2015

and the petitioner has deposited the reservation fees but the respondent

no.2 did not execute the lease deed and on the basis of exparte report and

without issuing any show cause notice the allotment was cancelled. It is

further submitted that the reports submitted by the enquiry officers were

merely preliminary reports and the State Government and the respondent

no.2 have illegally taken a cognizance of preliminary reports submitted

by the enquiry officers. It is further submitted that the reports are also

self- contradictory and are based on conjecture and assumption. Next it is

submitted that the enquiry reports are exparte and without affording any

opportunity of hearing. The learned counsel further submits that the

advertisement uses the word “almost” to allot only 26 plots. It is

submitted that the small mistake does not make the entire process

nugatory.

6

Learned counsel for the petitioner next submitted that Section 7 of

the Uttar Pradesh Industrial Area Development Act, 1976

3

gives the

power of allotment to the CEO. It is submitted that only financial

consideration is not the criteria for the development authority. The object

is not to earn money but to set up the industries. Lastly, it was urged that

the State largess can be granted without advertisement unless it is found

that it was arbitrary, irrational and discriminatory. He has placed reliance

on the judgment of the Karnataka High Court in the case of Lalbi v.

Modinamma @ Modinbee and others

4

, and the judgments of the

Supreme Court in Popcorn Entertainment and another v. City

Industrial Development Corpn. and another

5

; Sunil Pannalal

Banthia and others v. City & Industrial Development

Corporation of Maharashtra Ltd. and another

6

; State Bank of

India and others v. D.C. Aggarwal and another

7

;

Commissioner of Income Tax, Madras v. K.R. Sadayappan

8

.

Sri Dhananjay Awasthi, learned counsel for the respondents, has

submitted that GIDA advertised only 26 plots, in which the petitioner was

given allotment letters, but subsequently due to irregularities in the

allotment it was cancelled and money was refunded vide cancellation

order dated 26/28.08.2017. A fresh advertisement was made which was

cancelled and again it has been advertised on 02.03.2019 and the last date

for the submission of application was 07.04.2019. He submitted that

irregularities were pointed out in an enquiry conducted at the behest of

the Lokayukta and acting on the enquiry report the State directed for

cancellation of the allotment. He has drawn our attention to the enquiry

report, which is annexure-1 to the counter affidavit, wherein several

irregularities have been found in the said enquiry. It was further submitted

that mere issuance of allotment letter does not create any indefeasible

3Act, 1976

4(Karnataka) (DB) (Circuit Bench at Gulbarga) : Law Finder Doc Id # 771754 : 2012 ILR

(Karnataka) 4403 : 2012 (74) R.C.R. (Civil) 283

5(2007) 9 SCC 593

6(2007) 10 SCC 674

7AIR 1993 SC 1197

8(1990) 4 SCC 1

7

right in such contractual matters especially when deposited money has

also been returned. Lastly, it was urged that two separate enquiries were

conducted: one at the instruction of the Lokayukta and the preliminary

enquiry report submitted by the Chief Development Officer, and on the

basis of those enquiries the GIDA Board resolved to cancel the allotment

and return the deposited money.

Lastly, it was urged that no document has been executed in

pursuance of the allotment order and possession has also not been given.

We have heard and considered the submissions advanced by

learned counsel for the parties and perused the material on the record.

The questions, therefore, that fall for consideration are as to

whether by issuance of allotment letter and deposit of money by the

petitioner the contract was concluded; and, (ii) whether for the breach of

the contract the petitioner can seek the relief under Article 226 of the

Constitution of India.

On the first issue, learned counsel for the petitioner has submitted

that if an allotment letter has been issued, it amounts acceptance of the

offer of the petitioner and the contract has concluded. Per contra, the

contention of learned counsel for the respondents is that pursuant to the

allotment order the petitioner was not handed over the possession nor any

lease-deed has been executed in his favour, hence it cannot be said that

the contract has been concluded or there is a concluded contract.

Before proceeding further we deem it appropriate to refer some

decisions of the Supreme Court on the first issue i.e. whether it was

concluded contract.

In Uttar Pradesh Avas Evam Vikas Parishad and others v.

Om Prakash Sharma

9

somewhat similar situation arose. The Uttar

Pradesh Avas Evam Vikas Parishad, which is a statutory authority,

auctioned some shops and a plot by a public auction. The appellant before

9(2013) 5 SCC 182

8

the Supreme Court i.e. the Uttar Pradesh Avas Evam Vikas Parishad

accepted the highest bid of the respondent, who deposited 20% of the bid

amount plus the earnest money. The bid was rejected by the Housing

Commissioner of the Board and the amount was refunded to the

respondent/plaintiff. The respondent filed a suit under Section 34 of the

Specific Relief Act, 1963 seeking declaratory relief that the auction in his

favour was final and binding on the Avas Evam Vikas Parishad. The trial

Court decreed the suit. In appeal the judgment and decree of the trial

Court was set aside. The High Court in the second appeal again decreed

the suit. The review was also dismissed by it. Before the Supreme Court

the issues, amongst other, raised were that “(a) What are the rights of the

plaintiff/bidder participating in the auction process in relation to the plot

in question? (b) Whether there is any vested right upon the plaintiff/

bidder until the bid is accepted by the competent authority in relation to

the property in question? Merely because the plaintiff is the highest

bidder by depositing 20% of the bid amount without there being approval

of the same by the competent authority and it amounts to a concluded

contract in relation to the plot in question? (c) Whether the plaintiff could

have maintained the suit in absence of a concluded contract?”

The Supreme Court answered the points (a) and (b) in affirmative

and held that “so long as an order regarding final acceptance of the bid

had not been passed by the Chairman of the Housing Board, the highest

bidder acquire no vested right to have the auction concluded in his favour

and the auction proceedings could always be cancelled.”. The Court held

that in absence of acceptance of the bid offer by the plaintiff to the

competent authority of the defendant there is no concluded contract. The

Court further held that under Section 4 of the Contract Act the proposal

can be said to be completed when the same is accepted by the competent

authority. Relevant part of the judgment reads as under:

“39. Further, the communication under Section

4 of the Contract Act speaks of when the

communication will complete. It says:

9

“4. Communication when

complete.—The communication of a

proposal is complete when it comes to the

knowledge of the person to whom it is made.

The communication of an acceptance is

complete—

as against the proposer, when it is put in

a course of transmission to him so as to be out

of the power of the acceptor;

as against the acceptor, when it comes to

the knowledge of the proposer.”

The proposal is said to have been completed when the

same is accepted by the competent authority, which

has not been done in the instant case. Neither the

Housing Commissioner nor the Assistant Housing

Commissioner accepted the proposal in writing;

therefore, there is no communication of acceptance of

the offer of the plaintiff. In this regard, this Court in

Haridwar Singh v. Begum Sumbrui

10

has held that the

communication of acceptance of the highest bid is

necessary for concluding the contract.”

Applying the aforesaid principle in the present case, we find that

there is considerable merit in the contention urged by learned counsel for

the petitioner that there was a concluded contract between the parties.

Indisputably, the respondent has issued an allotment letter on 31.03.2015

and the petitioner has deposited a sum of Rs.19,02,570/- on 15.01.2016 in

pursuance of the demand made by the respondents. Thereafter a letter was

sent to the petitioner on 03.02.2016 raising demand for the lease rent etc..

These facts have not been denied in the counter affidavit. Hence, it can be

safely held that after acceptance of the bid of the petitioner and allotting

him Plot No. F-5 in Sector-15, the contract was concluded irrespective of

the fact that the possession was not given to the petitioner and formal

lease deed has not been executed.

We can not persuade ourselves to subscribe the view that the

petitioner has no legal right or vested right to challenge the decision of

the second respondent cancelling the entire auction and to invite fresh

10(1973) 3 SCC 889 : AIR 1972 SC 1242

10

applications in respect of all the 83 plots.

In respect of Question No. (II) we may in this regard gainfully refer

to the decisions of the Supreme Court which are apposite in the facts of

the present case.

In Kisan Sahkari Chini Mills Limited and others v.

Vardan Linkers and others

11

the respondent therein pursuant to a

tender notice issued by the Sugar Mill, which produces the molasses,

offered for the purchase of molasses. In the State of Uttaranchal, there

were six State controlled sugar mills. The sale of molasses is controlled

by the Molasses Sale Committee, which was constituted by the State

Government. The respondent therein was permitted to lift certain amount

of molasses from five sugar mills. In the meantime the State Government

received several complaints, hence the competent authority stayed the

operation of the order passed by the Assistant Cane Commissioner for

lifting molasses. The respondent therein challenged the said action by

way of a writ petition for a direction for continuance of supply of the

entire quantity for which the permission was granted to him. The High

Court directed the State Government to consider the grievance of the

respondent. The State Government rejected the representation of the

respondent therein on the ground that there was no valid contract for the

supply of molasses and the order/letter issued by the Assistant Cane

Commissioner was without any authority and consequently, the State

Government cancelled the same. Similar issues, as raised in the present

writ petition, were raised before the Court which read as under:

“(i) Whether the High Court was right in

concluding/ assuming that there was a valid contract?

(ii) Whether the High Court was justified in

quashing the cancellation order dated 24-4-2004

passed by the Secretary, (Sugar)?”

While answering the issue regarding the jurisdiction of the Court

under Article 226 of the Constitution of India the Court held that even in

11(2008) 12 SCC 500

11

case the High Court finds that there is valid contract but if the

cancellation of contract is not arbitrary or unreasonable, the Court can

still refuse to interfere in the matter leaving the aggrieved party to take

recourse to the remedy available under the law. The Court held thus:

“23. ...The issue whether there was a concluded

contract and breach thereof becomes secondary. In

exercising writ jurisdiction, if the High Court found

that the exercise of power in passing an order of

cancellation was not arbitrary and unreasonable, it

should normally desist from giving any finding on

disputed or complicated questions of fact as to

whether there was a contract, and relegate the

petitioner to the remedy of a civil suit. Even in cases

where the High Court finds that there is a valid

contract, if the impugned administrative action by

which the contract is cancelled, is not unreasonable or

arbitrary, it should still refuse to interfere with the

same, leaving the aggrieved party to work out his

remedies in a civil court. In other words, when there is

a contractual dispute with a public law element, and a

party chooses the public law remedy by way of a writ

petition instead of a private law remedy of a suit, he

will not get a full-fledged adjudication of his

contractual rights, but only a judicial review of the

administrative action. The question whether there was

a contract and whether there was a breach may,

however, be examined incidentally while considering

the reasonableness of the administrative action. But

where the question whether there was a contract, is

seriously disputed, the High Court cannot assume that

there was a valid contract and on that basis, examine

the validity of the administrative action.”

Reference may also be made to Divisional Forest Officer v.

Bishwanath Tea Co. Ltd.

12

. In this case the Supreme Court has

considered the issue with regard to maintainability of the writ petition

where a complaint is made against a statutory authority after the breach of

contract. The Court has held that ordinarily the suit would be congnizable

by a civil court and the High Court in its extraordinary jurisdiction would

12(1981) 3 SCC 238

12

not entertain a petition and a relief flowing from a contract has to be

claimed in a civil suit. The Court observed thus:

“9. Ordinarily, where a breach of contract is

complained of, a party complaining of such breach

may sue for specific performance of the contract, if

contract is capable of being specifically performed, or

the party may sue for damages. Such a suit would

ordinarily be cognizable by the civil court. The High

Court in its extraordinary jurisdiction would not

entertain a petition either for specific performance of

contract or for recovering damages. A right to relief

flowing from a contract has to be claimed in a civil

court where a suit for specific performance of contract

or for damages could be filed. This is so well settled

that no authority is needed. However, we may refer to

a recent decision bearing on the subject. In Har

Shankar v. The Deputy Excise & Taxation

Commissioner

13

, the petitioners offered their bids in

the auctions held for granting licences for the sale of

liquor. Subsequently, the petitioners moved to

invalidate the auctions challenging the power of the

Financial Commissioner to grant liquor licences.

Rejecting this contention, Chandrachud J., (as he then

was), speaking for the Constitution Bench at page 263

observed as under: (SCC p.746, para 16)

Those who contract with open eyes must

accept the burdens of the contract along

with its benefits. The powers of the

Financial Commissioner to grant liquor

licences by auction and to collect licence

fees through the medium of auctions cannot

by writ petitions be questioned by those

who, had their venture succeeded, would

have relied upon those very powers to found

a legal claim. Reciprocal rights and

obligations arising out of contract do not

depend for their enforceability upon

whether a contracting party finds it prudent

to abide by the terms of the contract. By

such a test no contract could ever have a

binding force.

Again at page 265 there is a pertinent observation

which may be extracted: (SCC p. 747, para 21)

13(1975) 1 SCC 737 : (1975) 3 SCR 254: AIR 1975 SC 1121

13

Analysing the situation here, a concluded

contract must be held to have come into

existence between the parties. The

appellants have displayed ingenuity in their

search for invalidating circumstances but a

writ petition is not an appropriate remedy

for impeaching contractual obligations.

This apart, it also appears that in a later decision, the

Assam High Court itself took an exactly opposite view

in almost identical circumstances. In Woodcrafts

Assam v. Chief Conservator of Forests

14

a writ petition

was filed challenging the revision of rates of royalty

for two different periods. Rejecting this petition as not

maintainable, a Division Bench of the High Court held

that the complaint of the petitioner is that there is

violation of his rights under the contract and that such

violation of contractual obligation cannot be remedied

by a writ petition. That exactly is the position in the

case before us. Therefore, the High Court was in error

in entertaining the writ petition and it should have

been dismissed at the threshold.”

In M/s Dwarkadas Marfatia and Sons v. Board of

Trustees of the Port of Bombay

15

the Supreme Court has held that

the superior courts while exercising their jurisdiction in the administrative

decisions are concerned with decision making process. The writ Courts

should not interfere unless the decision is totally arbitrary, malafide and

perverse.

Recently, the Supreme Court in JSW Infrastructure Limited

and another v. Kakinada Seaports Limited and others

16

, in a

slightly different context, has reiterated the principles laid down in Tata

Cellular v. Union of India

17

. Paragraph-8 of the judgment reads as

under:

“8. We may also add that the law is well settled

that superior courts while exercising their power of

judicial review must act with restraint while dealing

14AIR 1971 Ass 92 : LR 1970 Ass 183

15(1989) 3 SCC 293

16(2017) 4 SCC 170

17(1994) 6 SCC 651

14

with contractual matters. A three-Judge Bench of this

Court in Tata Cellular v. Union of India

18

held that:

(i) there should be judicial restraint in review of

administrative action;

(ii) the court should not act like court of appeal;

it cannot review the decision but can only review the

decision-making process;

(iii) the court does not usually have the

necessary expertise to correct such technical decisions;

(iv)the employer must have play in the joints

i.e. necessary freedom to take administrative decisions

within certain boundaries.”

The principles underlying in these decisions are that if a public

element is involved then even in the case of concluded contract, the High

Court under Article 226 of the Constitution can entertain a writ petition if

it is established that the Government or its instrumentality, which is a

State within the meaning of Article 12 of the Constitution, has acted

unfairly, unreasonably or arbitrarily. The Court can also in its jurisdiction

under the judicial review examine whether the transparency was

maintained by the authorities while disposing the public largess. If the

Court finds that the action of the authorities was unreasonable and unfair

then the Court can strike down such decision under Article 14 of the

Constitution in spite of the fact that the action between the parties was in

the realm of the contract.

Learned counsel for the petitioner has vehemently urged that

cancellation of plot of the petitioner has been made without furnishing

any opportunity to the petitioner, hence on this ground alone the decision

of respondent no. 4 is arbitrary and illegal.

It is a trite law that principles of natural justice cannot be put in a

straitjacket formula. In the recent time, the principles of natural justice

have undergone a sea-change. The Court has now shifted from its earlier

concept that non-observance of the principles of natural justice itself

causes prejudice, hence the order becomes arbitrary. The recent shift in

18(1994) 6 SCC 651

15

the judgments of the Supreme Court in the case of State Bank of

Patiala and others v. S.K. Sharma

19

and Aligarh Muslim

University and others v. Mansoor Ali Khan

20

lays down “useless

formality theory”. In such cases the Supreme Court has held that the

Court will not insist for compliance of the principles of natural justice.

In A.M. Allison and another v. B.L. Sen and others

21

the

Supreme Court has ruled that “while exercising the jurisdiction under

Article 226 of the Constitution, the High Court has the power to refuse

the writs if it was satisfied that there has been no violation of justice”.

The said judgment has been quoted with approval by the Supreme Court

in the case of Ravi S. Naik v. Union of India and others

22

.

In Kumari Shrilekha Vidyarthi and others v. State of

U.P. and others

23

the Supreme Court has held as under:

“48. … Non-arbitrariness, being a necessary

concomitant of the rule of law, it is imperative that all

actions of every public functionary, in whatever

sphere, must be guided by reason and not humour,

whim, caprice or personal predilections of the persons

entrusted with the task on behalf of the State and

exercise of all power must be for public good instead

of being an abuse of the power.”

In Mohinder Singh Gill and another v. The Chief

Election Commissioner, New Delhi and others

24

the Supreme

Court, speaking through Hon'ble Mr. Justice Krishna Iyer, has observed as

under:

“For fairness itself is a flexible: pragmatic and relative

concept, not a rigid, ritualistic or sophisticated

abstraction. It is not a bull in a china shop nor a bee in

one's bonnet. Its essence is a good conscience in a

given situation: nothing more- but nothing less.”

Applying the principle propounded in the above-mentioned cases,

19(1996) 3 SCC 364

20(2000) 7 SCC 529

21AIR 1957 SC 227

221994 Supp (2) SCC 641

23(1991) 1 SCC 212

24(1978) 1 SCC 405 : AIR 1978 SC 851

16

in the present case we find that two enquiries were made by the senior

officers and in both the separate enquiries serious irregularities were

found. We do not find that there was any arbitrary action on the part of the

development authority in cancelling the allotment, giving the opportunity,

in the facts of the present case, would be a formality.

Learned counsel for the petitioner has placed reliance on the

judgment of the Supreme Court in Sunil Pannalal Banthia (supra).

We find that the said case is distinguishable on the ground that in the said

case the Court has found that a discrimination has been done and the

irregularity, which was found in the enquiry, on the basis of which the

cancellation of the allotment was made, was not found to be applicable in

the case of the petitioners therein. In that context, the Supreme Court held

that in such a case the allotment could not have been cancelled merely

because certain recommendations have been made by a Committee. In the

said case, the allottee had commenced the construction work and

proceeded upto the first floor and it also completed construction of

underground water tank. In the present case, the possession has not been

handed over to the petitioner nor any lease deed has been executed. The

said case has no application in the facts of the present case.

In Popcorn Entertainment (supra) the allotment order for a

commercial plot was issued by the City Industrial Development

Corporation (for short, the 'CIDCO'). Earlier the CIDCO had issued an

advertisement for the plots but no response was received by it. Thereafter

on the application of the appellant therein, Popcorn Entertainment, an

allotment letter was issued asking to pay the price of the plot which was

deposited by it. Later the allotment order was cancelled. When the

appellant therein challenged the cancellation order, its writ petition was

dismissed by the High Court on the ground of alternative remedy. The

Supreme Court set aside the order of the High Court and remitted the

matter back to the High Court to decide the matter on merit. This case

also is not of much help in the present case.

17

We have carefully perused the judgment of Commissioner of

Income Tax, Madras (supra) and found that this case has no

application in the facts of the present case. In D.C. Aggarwal (supra)

the case was in respect of observance of the natural justice in the

disciplinary proceeding. We have already referred the law on the violation

of the natural justice in the earlier part of the judgment. In our view, this

case also does not help the petitioner.

As regards the maintainability of the writ petition, it is a trite law

that if the action of the State is found to be arbitrary and illegal, the writ

petition is maintainable and in the judicial review the Court can examine

the facts whether there was any arbitrary or unreasonable stand of the

respondents. It is a well settled law that the parameters of the judicial

review are very limited and when the Court finds that the action is

malafide or unreasonable, only in that situation the Court interferes in the

matter. In the present case, no element of malafide has been made against

the GIDA. We have carefully perused the enquiry report dated 28

th

December, 2015 submitted by the Chief Development Officer, Gorakhpur

and the Additional Commissioner (Administration), Gorakhpur. They

have found serious irregularities in the allotment of the plot. The relevant

part of the enquiry report is extracted below:

“... tSlk fd Åij mYys[k fd;k tk pqdk gS fd

xhMk }kjk 26 Hkw[kaMksa ds vkoaVu gsrq uksfVl@Vs.Mj foKkiu

v[kckj esa izdkf'kr djk;k x;k Fkk vkSj mlds foijhr 83

Hkw[kaMksa dk vkoaVu fd;k x;kA 26 Hkw[kaMksa ds djk, x,

vkoaVu ds fo:) 242 vkosnu i= vk,A fuf'pr :i ls

vkosnudrkZvkas us vkosnu djrs le; 26 Hkw[kaMksa ij gh /;ku

dsafnzr fd;k gksxk vkSj mlh ds vuqlkj vius&vius vkosnu

i= xhMk dks izsf"kr fd, x, gksaxsA mudks ;g irk ugha jgk

gksxk fd 26 Hkw[kaMksa dk izdk'ku djk;k tk jgk gS vkSj

vkoaVu 83 Hkw[kaMksa dks dj fn;k tk,xkA fuf'pr :i ls

;fn 83 Hkw[kaMksa dk foKkiu djk;k x;k gksrk rks

vkosnudrkZvksa dh la[;k vf/kd gksrh vkSj ,sls vkosnudrkZ

tks 26 Hkw[kaMksa ds fo:) vkosnu ds bPNqd ugha Fks] os 83

Hkw[kaMksa ds fo:) viuk vkosnu fuf'pr :i xhMk dks Hkstrs

vkSj ;g la[;k 242 ds foijhr fuf'pr :i ls vf/kd gksrh

18

vkSj bl izdkj xhMk }kjk Hkw[kaM vkoaVu dh dk;Zokgh

vf/kd ikjn'khZ gksrh vkSj vf/kd ls vf/kd la[;k esa bPNqd

vkosnudrkZ blesa Hkkx ysrs] ijarq xhMk }kjk ,slk ugha fd;k

x;kA xhMk dh bl dk;Zokgh esa ikjnf'kZrk ifjyf{kr ugha

gksrh gS vkSj dh xbZ dk;Zokgh nwf"kr gSA ,slk yxrk gS xhMk

us tkucw>dj ,slk fd;k gS vkSj yksxksa dks Hkze o va/ksjs esa

j[kk] ftlls bPNqd vkosnudrkZ vkosnu djus ls oafpr jg

x,A mijksDrkuqlkj mDr f'kdk;r xaHkhj izd`fr dh gS vkSj

xhMk ds vf/kdkfj;ksa }kjk dh xbZ dk;Zokgh fu;ekuqlkj ugha

gSA bl izdkj f'kdk;r fcanq la[;k&1 lgh gSA”

In addition to above, the Lokayukta, U.P. has also issued a direction

to the State Government to enquire into the allegations of irregularity and

corruption. Pursuant to the said communication of the Lokayukta the

State Government had appointed the Commissioner, Consolidation, U.P.,

Lucknow to look into the matter. The Commissioner, Consolidation, has

submitted a report dated 26

th

September, 2016 before the authority in

respect of the same illegalities. The relevant part of the report reads as

under:

“fu"d"kZ%& mijksDr foLr`r ijh{k.k ds i'pkr ;g fu"d"kZ

izkIr gks jgs gSa fd izdj.k esa 83 vkS|ksfxd Hkw[kaMksa dk

vkoaVu fd;k x;kA tcfd 26 Hkw[kaMksa ds vkoaVu ds laca/k

esa gh foKkiu nSfud lekpkj i=ksa esa djk;k x;kA Hkw[kaMksa

ds vkoaVu esa iw.kZ ikjnf'kZrk gsrq 'ks"k 57 Hkw[kaMksa ds vkoaVu

ds lEcU/k esa foKkiu laca/kh dk;Z fd;k tkuk Js;Ldj gksrk

rFkk xhMk ds vkfFkZd fgr Hkh lqjf{kr jgrsA”

From a perusal of both the enquiry reports it is evident that several

serious lapses were committed by the then officials. On the basis of the

enquiry report submitted by two members of the fact- finding enquiry the

State Government vide its order dated 19.02.2016 initiated the

disciplinary proceedings against two officers, namely, Sri Gyan Prakash

Tripathi, the then CEO, and Sri A.K. Singh, Manager (Property) of the

GIDA, who were placed under suspension. The aforesaid two officers

preferred a writ petition, being Service Bench No. 5769 of 2016, Gyan

Prakash Tripathi and another v. State of U.P. and others, challenging the

decision of the State Government on the ground that the officers who

have submitted the preliminary report were junior to them. The High

19

Court vide order dated 16.03.2016 disposed of the said writ petition and

permitted the respondents to enquire the matter by some senior officers

independently and the report submitted by those officer would only be the

basis for further action, and the High Court set aside the order of the State

Government.

From the material on the record we find that although this Court in

its order dated 16.03.2016 (supra) has permitted the respondents to get

fresh enquiry conducted by some senior officers but, for the reasons best

known to the State Government and the GIDA, the matter was treated to

be closed in pursuance of the directions of the High Court and no further

enquiry was conducted though the High Court has not expressed any

opinion on the merit and permitted the respondents “to enquire the matter

by some senior officers independently”.

Admittedly, only 26 plots were advertised by the respondent no. 2.

However, total 83 plots have been allotted. The justification put forward

by the petitioner that since there were 219 applicants and there were only

26 plots allotted, therefore, the authorities deemed it appropriate to allot

remaining 57 vacant plots without advertisement. We find it difficult to

accept the said explanation. If 26 plots were advertised, remaining plots

which were not advertised should not have been allotted to other persons.

Moreover, from a perusal of the enquiry reports we are of the opinion that

the action of the respondents to cancel the entire advertisement was not

arbitrary, unreasonable and unfair. Thus, under Article 226 of the

Constitution we do not find any justifiable ground to interfere in the

matter. As held by the Supreme Court, in the case of breach of contract it

is open to the petitioner to work out other remedy available under the law.

From the impugned order it is also evident that 8 persons have already

deposited the entire amount and they have raised some construction. In

the case of those 8 applicants, the GIDA has sought legal opinion and it

was resolved that further decision shall be taken subsequently. We find

that the cases of those 8 persons are different than the petitioner, who had

20

admittedly not been given possession of the plot. Thus, there is no

question of raising any construction over Plot No. F-5, Sector-15.

In view of the above, we do not find any ground to interfere in our

extraordinary jurisdiction under Article 226 of the Constitution.

Accordingly, the writ petition is dismissed.

We also direct the State Government to continue further action

against two officials namely Sri Gyan Prakash Tripathi, the then CEO,

and Sri A.K. Singh, Manager (Property) of the GIDA, against whom the

disciplinary proceedings were initiated. The disciplinary proceedings

must be brought to its logical end. Even if the said officers are retired,

action be taken against them in terms of the relevant service rules/law.

Office is directed to send a copy of this order to the Chief

Secretary, Government of Uttar Pradesh, Lucknow for appropriate orders.

Order Date :- 05

th

September, 2019

MAA/SKT/-