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As per case facts, the petitioner, a developer, obtained licenses in 2014 for group housing but faced financial inviability and inability to undertake construction due to the respondent-State's failure to
...lay essential infrastructure for over ten years. Petitioner surrendered licenses, but the State, via a 2020 notification introducing Rule 17-B, forfeited substantial fees and forced land surrender. The petitioner challenged this, seeking to quash the notification and orders, and recover forfeited amounts. The question arose whether the forfeiture of license, conversion, and infrastructure development charges as per Rule 17-B(3) was a justifiable claim or an arbitrary penalty. Finally, the High Court held that the forfeiture of these charges was arbitrary, capricious, and constituted unjust enrichment, declaring Rule 17-B(3) ultra vires to that extent. It allowed forfeiture of interest but ordered cancellation of forced land transfers and refund/adjustment of principal amounts. The Court found no intentional breach by the petitioner and rejected the State's contractual breach and estoppel arguments.
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