As per case facts, the Amritsar Improvement Trust appealed against concurrent judgments granting injunctions and directing formal agreements for plots allotted under a discretionary quota. Plaintiffs argued valid allotments and ...
No Acts & Articles mentioned in this case
RSA-1820-1995 (O&M) & -:1:-
RSA-2395-1998 (O&M)
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
1. RSA-1820-1995 (O&M)
Reserved on :-11.11.2025
Pronounced on:-17.11.2025.
Date uploaded on:-18.11.2025
The Amritsar Improvement Trust, Amritsar
… Appellant
Versus
Manjit Singh and Others
... Respondents
2 RSA-2395-1998 (O&M)
The Amritsar Improvement Trust, Amritsar and another
… Appellants
Versus
Dr. P.C. Arora
... Respondent
****
CORAM: HON'BLE MR. JUSTICE VIRINDER AGGARWAL
Argued by :-
Mr. Kushagra Mahajan, Advocate
for the appellant(s).
Mr. Sumeet Mahajan, Senior Advocate with
Mr. Shrey Sachdeva, Advocate for
respondents No. to 3 in RSA-1820-1995.
Mr. Prateek Mahajan, Advocate and
Ms. Prerna Malhotra, Advocate for
respondent in RSA-2395-1998.
****
VIRINDER AGGARWAL , J .
1. This consolidated judgment governs the adjudication of the
captioned Regular Second Appeals (for short to be referred as “RSAs”), each
RSA-1820-1995 (O&M) & -:2:-
RSA-2395-1998 (O&M)
arising from an identical factual and legal matrix. As the parties are
common, the impugned judgments and decrees are coextensive, and learned
counsel for the respective sides have consented to joint disposal, these
appeals are adjudicated together in the interest of judicial economy,
consistency of precedent, and procedural efficiency.
2. At the instance of learned counsel appearing for both sides, the
factual matrix, for the purpose of this composite adjudication, has been
distilled from the records of both connected appeals so as to present a
complete and accurate account of the material circumstances. Although the
issues arising in each appeal are distinct, the facts, as delineated herein, are
adopted from both matters and shall collectively constitute the representative
factual foundation for the determination of the present proceedings.
3. The appellants/defendants, in both the captioned RSAs, have
invoked the appellate jurisdiction of this Court assailing the concurrent
judgments and decrees rendered by the learned Courts below. Through these
appeals, the appellants seek judicial scrutiny and correction of the findings,
reasoning, and operative directions embodied in the impugned decisions,
contending that the subordinate Courts failed to appreciate the evidence on
record and to apply the governing principles of law in their proper
perspective. The appellants thus urge this Court to exercise its revisory and
corrective jurisdiction for setting aside or modifying the impugned decrees
to the extent they are alleged to be legally unsustainable or vitiated by
material irregularity or error apparent on the face of the record.
RSA-1820-1995
4. A concise yet comprehensive exposition of the essential facts
giving rise to both appeals is delineated hereinbelow. The ensuing narrative
RSA-1820-1995 (O&M) & -:3:-
RSA-2395-1998 (O&M)
constitutes a precise and judicious synthesis of all material circumstances
relevant to the adjudication of the present appellate proceedings, ensuring
that the factual substratum is articulated with utmost clarity, coherence, and
legal precision are as under:-
“The plaintiffs have instituted the present suit seeking a
decree of permanent prohibitory injunction restraining the
defendant-authority, its officers, agents, or any person acting
under its instructions, from allotting, transferring, or otherwise
alienating the plots No. B/99, 4/107, and A/129, situated within
the duly sanctioned Ajnala Road Development Scheme, which
was conceived, framed, and implemented by the defendant
under the provisions of the Punjab Town Improvement
(Utilization of Land and Allotment of Plots) Rules, 1975.
It is specifically pleaded that the said plots have been
validly allotted to the plaintiffs Nos. 1, 2, and 3 respectively, in
accordance with the approved scheme and applicable statutory
rules. The plaintiffs further seek a decree of mandatory
injunction directing the defendant to execute formal
agreements in Form ‘D’ with each of the plaintiffs in respect of
their respective allotted plots, thereby recognizing and
effectuating their lawful entitlement arising from such
allotment. Hence the suit.”
5. Pursuant to service of summons of the civil suit, the defendants
appeared and contested the suit by filing written statement, in which it is
asserted that the Ajnala Road Development Scheme was duly framed and
sanctioned by the Government of Punjab under the Punjab Town
RSA-1820-1995 (O&M) & -:4:-
RSA-2395-1998 (O&M)
Improvement Act, 1922, and that allotments under the scheme were to be
made strictly in accordance with the Rules framed under Section 73 thereof.
The plaintiffs, it was pleaded, were only recommended for plots under the
Government’s discretionary quota, which required specific governmental
approval. Vide Memo No. 5037-3CII-80/7036 dated September 1980, the
Government rejected all such recommendations made by former Chairmen
of Improvement Trusts, including those concerning the plaintiffs. The
defendants contended that the sums deposited constituted earnest money
only, as no valid allotment existed, and that no obligation arose to execute
agreements in Form ‘D’ since the alleged allotments stood cancelled by
competent authority.
6. The respondents/plaintiffs filed a replication wherein the
material averments of the plaint were reiterated and reaffirmed, while the
assertions and defenses raised by the appellants/respondents were
specifically traversed. Upon consideration of the pleadings and documents
on record, the Civil Court framed the following issues for adjudication, with
a view to comprehensively determining the respective claims and defenses
arising in the present matter:-
1. Whether the plaintiffs were allotted plots NO. B-99, 107 and A-129
by the defendant, OPP.
2. Whether the allotment made to the plaintiff has been cancelled? OPD.
3. Whether the plaintiff is entitled to the injunction as prayed for? OPD.
4. Relief.
RSA-2395-1998
7. The narrative represents a careful distillation of the
circumstances materially relevant to the issues presently before this
RSA-1820-1995 (O&M) & -:5:-
RSA-2395-1998 (O&M)
appellate forum, ensuring that the factual background is presented with both
precision and adequate comprehensiveness: -
“The plaintiff has instituted the present suit seeking a
decree of permanent prohibitory injunction restraining the
defendants, their servants, agents, representatives, or any person
claiming through or under them, from allotting, alienating, or
otherwise transferring Plot No. 51-A measuring 500 square
yards, comprised within the duly sanctioned Ajnala Road
Development Scheme, to any person other than the plaintiff, to
whom the said plot already stands validly allotted in accordance
with law.
The plaintiff further seeks a decree of mandatory
injunction directing the defendants to execute and register a
formal agreement of sale in Form ‘D’, or in any other form as
prescribed under the relevant statutory provisions, in favour of
the plaintiff in recognition and enforcement of the said
allotment.
Additionally, the plaintiff prays for a declaration that the
purported cancellation of the aforesaid allotment by the
Amritsar Improvement Trust, Amritsar, is illegal, void ab initio,
arbitrary, and ultra vires the provisions of the Punjab Town
Improvement Act, 1922, the Rules framed thereunder, and
Articles 14 and 300-A of the Constitution of India, being in
derogation of the plaintiff’s vested and lawful rights. Hence the
suit.”
RSA-1820-1995 (O&M) & -:6:-
RSA-2395-1998 (O&M)
8. Upon service of summons, the defendants entered appearance
and filed their written statement, wherein they contested the maintainability
of the suit, raising preliminary objections that no notice under Section 98 of
the Punjab Town Improvement Act, 1922 had been served, that the suit had
not been instituted through a competent person, and that it was improperly
valued for purposes of court-fee and jurisdiction.
8.1. On merits, the defendants categorically denied the alleged
₹deposit of 2,000/- and the existence of any valid or enforceable contract
with the plaintiff. It was, however, admitted that the Punjab Government,
vide letter dated 25.07.1980, had directed cancellation of certain allotments,
including that of the plaintiff. The defendants maintained that no final or
approved allotment ever came into existence, as the same was subject to
prior Government sanction, which was never accorded. All remaining
allegations were denied, and dismissal of the suit was sought.
9. The respondents/plaintiffs filed a replication wherein the
material averments of the plaint were reiterated and reaffirmed, while the
assertions and defenses raised by the appellants/respondents were
specifically traversed. Upon consideration of the pleadings and documents
on record, the Civil Court framed the following issues for adjudication, with
a view to comprehensively determining the respective claims and defenses
arising in the present matter:-
1. Whether the suit is not maintainable in the present from? OPD.
2. Whether the suit is bad for want of notice u/s 98 of the Town
Improvement Act?OPD.
3. Whether the plaint has been filed and signed also verified by duly
authorised person if not its effect ?OPD.
4. Whether the plaintiff in entitled to the injunction as prayed for? OPD.
RSA-1820-1995 (O&M) & -:7:-
RSA-2395-1998 (O&M)
5. Relief.
10. Both parties were granted full and effective opportunities to
adduce oral and documentary evidence in substantiation of their respective
claims and defences. Upon culmination of the trial proceedings, and after due
consideration of the pleadings, evidence, and arguments advanced by learned
counsel, the learned Additional Senior Sub Judge, Amritsar, as well as the
learned Civil Judge (Senior Division), Amritsar, decreed the respective suits
in favour of the respondents/plaintiffs.
10.1. Aggrieved thereby, the appellants/defendants preferred statutory
first appeals before the learned Additional District Judge, Amritsar. The
learned First Appellate Court, upon a comprehensive reappraisal of the
evidence and findings of the Trial Court, affirmed the decrees and dismissed
the appeals, thereby rendering concurrent findings on all material issues.
11. Assailing the legality, propriety, and correctness of the
concurrent judgments and decrees passed by both Courts below, the
appellants/defendants have instituted the present Regular Second Appeals,
which, upon preliminary scrutiny, were duly admitted to regular hearing.
Pursuant to notice, the respondents entered appearance through their learned
counsel and actively contested the appeals. The complete lower Court record
was accordingly summoned, examined and placed before this Court for an
exhaustive, reasoned, and judicious adjudication on the issues arising for
consideration.
12. The appeal gives rise to the following “quaestio juris
substantialis” for determination by this Court:-
RSA-1820-1995 (O&M) & -:8:-
RSA-2395-1998 (O&M)
i.Whether the suit filed by the respondent-plaintiff is barred
by res-judicata.?
ii. Whether the allotment of residential plots under an
Improvement Trust Scheme through a discretionary quota
is permissible?
13. I have heard learned counsel for the appellants in their
respective Regular Second Appeals and carefully considered their
submissions in conjunction with the pleadings, evidence, and the concurrent
findings recorded by the Courts below. The entire record has been
meticulously examined to determine whether the impugned judgments and
decrees suffer from any jurisdictional error, legal infirmity, or perversity
warranting the exercise of this Court’s appellate corrective jurisdiction.
13.1. Learned counsel for the appellants contended that both the
learned Trial and First Appellate Courts failed to appreciate that the suit
instituted by the respondents/plaintiffs is barred by res judicata, as the
petitioners had previously filed Civil Writ Petitions Nos. 5036, 4545, and
5037 of 1982 against the appellant-Trust, all of which were dismissed on
merits at the threshold. It is submitted that, notwithstanding the existence of
these prior adjudications, the Courts below erred in entertaining the suit,
thereby committing a serious legal misstep.
14. Learned counsel for the respondents/plaintiffs, on the other
hand, contended that the Courts below have correctly held that the suit is
maintainable and is not barred by the doctrine of res judicata. It was
submitted that the applicability of res judicata involves a mixed question of
law and fact, which must be specifically pleaded and substantiated with
RSA-1820-1995 (O&M) & -:9:-
RSA-2395-1998 (O&M)
evidence. In the present case, no such pleading or proof was forthcoming
from the appellant-defendant.
14.1. It was further submitted that the appellant–defendant had, before
the First Appellate Court, moved an application seeking amendment of the
written statement for incorporating a plea of res judicata. The Appellate
Court, upon due consideration, expressly declined the said request. That
order, having not been assailed by the appellant–defendant before any higher
forum, has since attained finality.
14.2. It was additionally contended that the earlier writ petitions
instituted by the appellant/defendant were dismissed in limine, without any
adjudication on the merits of the substantive issues in dispute. A dismissal at
the threshold, unaccompanied by a reasoned determination, does not give
rise to any bar of res judicata, as the principle applies only where the matter
has been “heard and finally decided” by a competent court. Thus, the
ingredients of Section 11 CPC remain wholly unfulfilled. In the absence of
proper pleadings, requisite foundation, or proof, res judicata cannot be
invoked by mere assertion. The plea, being unpleaded, unsubstantiated, and
legally misconceived, cannot preclude the present proceedings. The Courts
below, therefore, acted within the bounds of law in examining and deciding
the controversy on its merits, unimpeded by any such alleged bar.
14.3. A perusal of the impugned judgments unmistakably reveals that
CWP-2859-1986 was disposed of in limine; however, the Division Bench,
while declining interference at the threshold, did record reasons in support of
its conclusion. The relevant portion of the order dated 29.05.1986, which
encapsulates the rationale adopted by the Court, reads as under:-
RSA-1820-1995 (O&M) & -:10:-
RSA-2395-1998 (O&M)
“The names of the petitioners were recommended to the State
Government by Improvement Trust, Amritsar for allotment of
residential sites of re serve price. The recommendations were rejected on
the ground that the trust had arbitrarily picked up the petitioners without
inviting applications from all eligible per son s. The recommendations was
thus rejected for valid reasons. The Ld. counsel for the petitioners,
however, urged that previously on similar recommendations 156 people
were allotted state sites and that sate Govt. was not competent to do
discriminate against the petitioners and reject the recommendations made
in their favour. We are unable to accept the contention if previously a
wrong had been done, the petitioners cannot come to this court for a
detection to commit the same wrong again. Consequently, there is no
merit in this petition and the same is dismissed in limine.
"
15. Reliance was placed on the binding precedent of the Hon’ble
Supreme Court in ‘Pujari Bai v. Madan Gopal, (1989) SC 433’, wherein it
was held that when a matter has been adjudicated on its merits and a final
order rendered, any subsequent suit involving the same cause of action
between the same parties is precluded by the doctrine of res judicata, and
Courts are obliged to decline exercise of jurisdiction. It is thus urged that the
concurrent judgments of the Courts below are vitiated by their failure to
recognize the bar of res judicata and merit reconsideration, the relevant
extract is reproduced as under:-
“24. It thus becomes clear that when a writ petition after contest is
disposed of on merits by a speaking order, the question decided in
that petition would operate as res judicata, but not a dismissal in
limine or dismissal on the ground of laches or availability of
alternative remedy. The High Court and the courts below, therefore,
RSA-1820-1995 (O&M) & -:11:-
RSA-2395-1998 (O&M)
were not right in throwing out the suit of the appellant on the ground
of res judicata.”
15.1. Whereas the Division Bench of this Court in ‘Punjab State Co-
operative Bank Limited, Chandigarh and Another vs. Presiding Officer,
Labour, Court. UT, Chandigarh, 1993(1) LPR 310’ held as under:-
7. xxxxxx
‘If the High Court had simply dismissed the writ petition in
limine without giving any reasons, it could be argued that the or-
der was not passed on merits and the workman could have ap-
proached the Labour Court, even if no such direction was given
by the High Court. There is no dispute that such a matter relating
to adjudication of dispute of termination of services of a work-
man could be referred to the Labour Court under Section 10 of
the Act. However, when different remedies.’
16. In the present case, it is evident that the appellant–defendant did
not, written statement, raise any plea founded upon the doctrine of res
judicata. The learned First Appellate Court has rightly observed that the
omission to plead such a foundational objection amounts to a conscious
waiver, for a party who fails to specifically assert a statutory bar in its
defence is deemed, in law, to have relinquished the benefit thereof ‘quaelibet
concessio est injuria sibi’ (a party who waives a right cannot later complain
of its loss). The application subsequently filed by the appellant– defendant
seeking amendment of the written statement to introduce this plea was
expressly declined, and that order has attained finality.
16.1. In these circumstances, and in the absence of any averment or
issue relatable to res judicata, the learned First Appellate Court has rightly
concluded that the suit cannot be held to be barred under Section 11 CPC.
RSA-1820-1995 (O&M) & -:12:-
RSA-2395-1998 (O&M)
The doctrine of res judicata is not attracted unless it is expressly pleaded,
duly proved, and affirmatively established through production of the prior
pleadings, issues, and adjudication in the earlier proceedings. A mere
invocation of the principle during oral submissions, without foundational
pleadings or evidentiary support, is wholly insufficient to defeat the
maintainability of a civil action. The conclusion reached by the learned First
Appellate Court is thus firmly rooted in the well-settled principle that facts
alleged must be supported by proof and warrants no interference in
second appeal.
17. Turning to RSA-1820-1995, the infirmity becomes even more
pronounced. In that matter, the appellant–defendant did not even file an
application seeking amendment of the written statement to introduce the plea
of res judicata. The pleadings of the earlier writ petition were never placed
on record. In the absence of the foundational documents namely, the copy of
the writ petition, the issues raised therein, and the precise nature of the
adjudication no Court can, merely on the basis of the final order, presume
that the matter directly and substantially in issue in the present suit was also
directly and substantially in issue in the earlier writ proceedings.
18. Learned counsel for the appellant–Improvement Trust has
strenuously contended that both the Courts below committed a grave
jurisdictional error in decreeing the suits, despite the settled legal position
that allotment of residential plots under a discretionary quota is impermissi-
ble in law. It is argued that the legal position on this issue is no longer res
integra, the Full Bench of this Court in Anil Sabharwal v. State of
Haryana, 1997(3) RCR (Civil) 260 having categorically held that
allotments made under discretionary quota are unconstitutional and void.
RSA-1820-1995 (O&M) & -:13:-
RSA-2395-1998 (O&M)
Reliance has also been placed upon Dr. Amar Singh and others v. State of
Punjab and another, 2003(4) RCR (Civil) 146, and the recent decision in
Gurdev Singh Sehmby v. Ludhiana Improvement Trust, 2023 NCPHHC
114991, to canvass that any allotment made dehors the statutory scheme, on
the basis of discretion, is unsustainable. Thus, according to the appellant, the
allotments in favour of the respondents/plaintiffs are legally indefensible and
ought to have been annulled.
18.1. Conversely, learned counsel for the respondents/plaintiffs has
supported the concurrent findings of the Courts below, contending that the
discretionary quota allotments in question stand protected in view of the
judgments of this Court whereby the blanket cancellation order issued by the
State Government was itself quashed. It is urged that the cancellation of all
discretionary quota allotments was struck down by this Court in CWP-5036-
1982, CWP-4545-1982, and CWP-5037-1982, vide judgment dated
24.05.1984. In light of the said pronouncement, the Courts below rightly
concluded that once the State’s omnibus cancellation order had been set
aside, the respondents/plaintiffs were entitled to the relief claimed and their
allotments could not be invalidated on the basis of the cancelled order.
Hence, no infirmity can be attributed to the concurrent findings recorded by
the Courts below.
18.2. I have gone through the record minutely, Full Bench of this
Court has quashed all such discretionary allotments in Full Bench decision
on Dr. Amar Singh’s case (supra), later followed by learned Single Bench
of this Court in Gurdev Singh Sehmby’s case (supra), relevant portion of
the judgment is contained in para Nos.12 to 15, which are reproduced as
under:-
RSA-1820-1995 (O&M) & -:14:-
RSA-2395-1998 (O&M)
“12. A perusal of Rules 8 and 12 of the Rules clearly shows that
residential plots and multi-storeyed houses are to be sold either by
draw of lots or by auction. A exception to this general rule is made
under Rule 4 of the Rules which provides for reservation of
residential plots in favour of the various categories of persons. As
noticed earlier, the Full Bench upheld the power of the Government
to make reservations for various defined categories, and groups of
persons. At the same time, it has been held that the discretion
conferred upon the Chief Minister has to be in consonance with the
various provisions of the Constitution of India. In other words, no
absolute discretion can vest in the Government for making either
reservations or allotments. The rules or the guidelines cannot lay
down arbitrary standards for exercise of the discretion. The rules or
the guidelines have to be well-defined, reasonable and must have a
nexus with the object sought to be achieved. The reservation
provided under Rule 4 of the Rules and the policy decision dated
31.1.1989 would have to satisfy the criteria of reasonableness as
required by Article 14 of the Constitution of India. In Anil
Subharwal's case (supra), this Court had already upheld the
reservation made in the State of Haryana in favour of Freedom
Fighters, Political sufferers, Defence personnel, Border Security
Force Personnel etc., persons appointed to Public Service by the State
Government and persons belonging to Scheduled Castes and
Backward Classes. Therefore, it is not necessary to examine the
constitutionality of the reservation provided in Rule 4(ii), (iii), (iv),
(v) and (vi) of the Rules. Reservation made in the aforesaid provision
is held to be valid and constitutional. In Anil Subharwal's case
(supra), this Court took note of the land-mark decision in the case of
Padfield v. Minister of Agriculture, Fishery and Food, (1968) A.C.
997 where the House of Lords rejected the theory of absolute
RSA-1820-1995 (O&M) & -:15:-
RSA-2395-1998 (O&M)
discretion. This Court also noticed the land-mark judgment of the
Supreme Court in the case of S.G. Jainsinghani v. Union of India,
AIR 1967 Supreme Court 1427. The observations of Ramaswami, J.
which have already been noticed in Anil Subharwal's case (supra)
may, however, be noticed again for the purposes of this case which
are as under:-
"41.XXXXXXXXXXXX
"In this context, it is important to emphasise that the absence of
arbitrary power is the first essential of the rule of law upon which
our whole constitutional system is based. In a system governed by
rule of law, discretion, when conferred upon executive authorities,
must be confined within clearly defined limits. The rule of law
from this point of view means that decisions should be made by the
application of known principles and rules and, in general, such
decisions should be predictable and the citizen should know where
he is. If a decision is taken without any principle or without any
rule it is unpredictable and such a decision is the antithesis of a
decision taken in accordance with the rule of law. (See Dicey "Law
of the Constitution" Tenth Edn., Introduction ex.). Law has reached
its finest moments', stated Douglas, J. in United States v.
Wunderlich (1951-342 US 98: 9 Law Ed 113), "when it has freed
man from the unlimited discretion of some ruler.....Where
discretion is absolute, man has always suffered. It is in this sense
that the rule of law may be said to be the sworn enemy of caprice.
Discretion, Lord Mansfield stated it in classic terms in the case of
John Wilkes (1970-98 ER 327), 'means sound discretion guided by
law. It must be governed by rule, no humour, it must not be
arbitrary, vague and fanciful."
13. After considering the whole gamut of case law, the Full Bench, in
Anil Subharwal's case (supra) observed as follows:-
RSA-1820-1995 (O&M) & -:16:-
RSA-2395-1998 (O&M)
"44. Before bringing a close to this aspect of the matter, we may
refer to a recent verdict of the Supreme Court in New Delhi Public
School & Ors. etc. v. HUDA and Ors., etc., JT 1996(7) S.C. 103.
This decision has been rendered by the Apex Court on an appeal
against the judgment of this Court in Seven Seas Educational
Society & Ors. v. HUDA, (1996-2) 113 P.L.R. 17: 1996(2) RCR 40
(P&H) wherein a Division Bench of this Court quashed the
allotments made by the HUDA. While upholding the decision of
the Division Bench, their Lordships made reference to Section 15
of the Act and Regulations 3, 4 and 5 of the Regulations and
observed:-
"........... A reading thereof, in particular Section 15(3) read with
Regulation 3(c) does indicate that there are several modes of
disposal of the property acquired by HUDA for public purpose. One
of the modes of transfer of property as indicated in sub-section (3)
of Section 15 read with sub- regulation (c) of Regulation 5 in public
auction, allotment or otherwise. When public authority discharges
its public duty the word "otherwise" would be construed to be
consistent with the public purpose and clear and unequivocal
guidelines or rules are necessary and not at the whim and fancy of
the public authorities or under their garb or cloak for any
extraneous consideration. It would depend upon the nature of the
scheme and object of the public purpose sought to be achieved. In
all cases, relevant criterion should be pre- determined by specific
rules or regulations and published for the public. Therefore, the
public authorities are required to make necessary specific
regulations on valid guidelines to exercise their discretionary
powers, otherwise, the salutory procedure would be by public
auction. The Division Bench, therefore, has rightly pointed out that
in the absence of such statutory regulations exercise of
RSA-1820-1995 (O&M) & -:17:-
RSA-2395-1998 (O&M)
discretionary power to allot sites to private institutions or persons
was not correct in law."
45. We, therefore, reject the argument of the learned counsel for the
respondent that absolute power could vest in the Chief Minister to
make allotment of plots according to his discretion and choice and
such discretion is immune from judicial scrutiny on the touch-stone
of Article 14 and other provisions of the Constitution. Nevertheless,
we may reiterate that the Government's powers under Section 30(1)
of the Act to give directions to the HUDA to reserve plots may be
used in favour of eminent professionals, outstanding sports persons,
musicians etc. as a group, provided such reservation is within the
parameters, scheme and objects of the Act. In fact, the policy
decision taken by the HUDA to reserve plots in favour of the
Government servants, Scheduled Caste, Backward Classes,
Freedom Fighters falls in this category. At the same time, it is
necessary to observe that the plots reserved for professionals etc.
can be allotted only after issuing advertisement of the policy
framed by the Government/HUDA and allotments will have to be
made keeping in view the principles laid down by the Supreme
Court in New India Public School's case (supra)."
14. The reservations as contained in Rule 4 of the Rules have been
justified by respondent No. 1 in the written statement as follows:-
"Para 16: The contents of this para are wrong and denied. The
Punjab Town Improvement (Utilisation of Land and Allotment of
Plots) Rules, 1983 have been framed under Section 73 of the
Punjab Town Improvement Act, 1922. In Rule 4 of the Rules ibid,
as reproduced in para 9 of the writ petition, reservation of plots to
certain deserving category of Society viz. Members of Legislative
Assembly, Members of Parliament, Freedom Fighters, Political
sufferers, Defence Personnel, War Widows, Government
RSA-1820-1995 (O&M) & -:18:-
RSA-2395-1998 (O&M)
Employees, Members of Scheduled Castes and Backward Classes
etc. has been provided in lieu of their services to the society and
socio-economic conditions. The reservation so provided, do not in
any manner affect the rights of general public for whom sufficient
number of plots are reserved which are allotted through draw of
lots, after inviting applications. The rules are thus balanced and
transparent and are so framed so as to cater to the persons of all
sections of society."
The aforesaid reasoning is akin to the reasoning which is given by the State
of Haryana in Anil Subharwal's case (supra). It was rejected by this Court
holding as under :-
"49. The narrow issue which is now required to be considered is
whether the criteria, namely, 'distinguished and needy people in all
walks of life' can be treated as valid criteria. Neither the word
'distinguished' nor the word 'needy' has been defined in the Act or
the rules or the regulations framed under it nor are they spelt out
from the documents placed on the record of the case. In the agenda
note (Annexure R2), reference has been made to some decision
dated 14.7.1971 taken by the then Chief Minister recorded on the
file. According to that decision, 15% plots in Sector 21, Faridabad
were reserved for members of the Haryana Assembly and
Members of Parliament and for allotment to certain categories of
persons such as political sufferers, writers, journalists and other
deserving persons. However, there is nothing on the record of this
petition to show that the HUDA took a policy decision to allot
plots to political sufferers, eminent writers, journalists etc. It can,
thus, be said that the question whether a person is distinguished
and needy for the purpose of allotment of a plot has been left to be
determined at the whims of the Chief Minister. Complete absence
of any guidelines for determination of the question as to who are
RSA-1820-1995 (O&M) & -:19:-
RSA-2395-1998 (O&M)
distinguished and needy, it is left to the sweet-will of the Chief
Minister to allot a plot by treating him to be a distinguished and
needy person. The criteria does not say that the
applicant/prospective allottee must have distinguished
himself/herself by serving the national cause or the cause of the
state or he/she should have achieved distinction in the field of
science, arts, sports, music, journalism, literature or the like at
international, national or state level. There is journdication as to
how the Chief Minister would determine whether a person is needy
or not. No criteria of income has been laid down. While making
recruitment to the public services against the quota reserved for
sports persons the candidate is required to possess a certificate of a
particular grade level in the field of sports. Similarly for
International/national/state or district level in the field of sports.
Similarly for particular grade showing his achievement at the
appointment on compassionate ground the criteria of family
income has been evolved. No such guideline has been framed for
exercise of power to allot plots under the discretionary quota. No
rule or regulation has been framed and no yardstick has been laid
down by following which the Chief Minister can determine that a
person is distinguished and needy. All is left to the unfettered
discretion of the Chief Minister. Conferment of such unbridled and
unguided power is clearly against the wider interpretation accorded
to the doctrine is equality embodied in Article 14 of the
Constitution in E.P. Royappa v. State of Tamil Nadu, AIR 1974
Supreme Court 555, Maneka Gandhi v. Union of India, AIR 1978
Supreme Court 597 and a host of other decisions some of which
have been relied upon by the Division Bench in Seven Seas
Educational Society and others v. HUDA and others (supra) and in
Hari Ram Singla v. State of Haryana, 1994 P.L.J 230: 1994(1)
RSA-1820-1995 (O&M) & -:20:-
RSA-2395-1998 (O&M)
RRR 606 (P&H). The arbitrariness of the criteria is amply
demonstrated from the facts of this case. As will be seen
hereinafter, in none of the orders passed by the Chief Minister of
allotment of plots under criteria of distinguished and needy
persons. In none of the orders passed by the Principal
Secretary/Special Principal Secretary/Deputy Principal
Secretary/Private Secretary/Personal Assistant to the Chief
Minister in the name of the latter there is a mention that plot under
the discretionary quota is being allotted to the applicant by treating
him to be a distinguished and needy person. Even in the
application filed in majority of over 800 cases of allotments
(between 1991 to March, 1996), the applicants have not stated that
they are distinguished and needy persons. Rather the applications
have been filed with the simple prayer that the plot be allotted to
the applicant under the discretionary quota of the Chief Minister
and on such application, the order has been recorded by
Officer/officials concerned directing the HUDA to allot a particular
plot to the applicant. This is clearly indicative of the vagueness of
the criteria of 'distinguished and needy people', Taking advantage
of the vague and arbitrary criteria, a vast majority of applicants
who have not distinguished themselves in any walk of life have
been conferred with the largesses in the form of big or small plots.
In some of the cases, two or more than two plots have been allotted
to the members of one family. Some of the beneficiaries of
allotment under the discretionary quota own palatial houses in the
cities like Delhi and Chandigarh. They have been allotted big plots
of one or two kanals. Therefore, we have no hesitation to hold that
the criteria incorporated in Annexure R11 is vague and arbitrary. It
conferred unlimited, unguided and unbridled discretion upon the
RSA-1820-1995 (O&M) & -:21:-
RSA-2395-1998 (O&M)
Chief Minister to allot plots without even considering whether a
person is really distinguished and needy or not."
15. In the present case, written statements have been filed on behalf of
the Improvement Trusts pursuant to the orders passed by this Court
on 30.5.1996. The Government have also been given. Reasons for
making the allotment in individual cases is not discernible either
from written statement filed by the respondents or from material
placed on record. In view of the law laid down by this Court in
Anil Subharwal's case (supra), it would not be possible to uphold
the reservation provided in Rule 4(i), (vii) and proviso 3 to the
aforesaid rule. No justification is given for carving out a
reservation for members of Parliament representing the State of
Punjab and the Members of the Punjab Legislative Assembly. 8%
of the plots of all sizes ie. 250, 300, 400 and 500 square yards are
reserved for this category. This reservation has absolutely no nexus
with the object sought to be achieved by the Improvement Trust
Act. It is simply largesse bestowed on an individual after winning a
parliamentary or State Assembly seat. This kind of reservation is
abhorrent to the concept of equality enshrined under various
provisions of the Constitution of India. 4% of the plots of 500
square yards only have been reserved for Non-Resident Indians.
The term "Non- Resident Indians" is totally vague. No discernible
reason has been assigned as to why a reservation has to be made
for Non-resident Indians. No criteria has been laid down for
selecting the Non-resident Indians candidate for allotment of the
plot. Some of the richest people living in this country, are officially
"Non-Resident Indians". Conversely the term "Non-Resident
Indians" would also include some of the richest Indians living
abroad. Allotment of these plots under the nomenclature of the
"Non-Resident Indians" is wide open to abuse and profiteering. It
RSA-1820-1995 (O&M) & -:22:-
RSA-2395-1998 (O&M)
has been noticed by this Court in Anil Subharwal's case (supra)
that taking advantage of the vague and arbitrary criteria i.e.
distinguished and needy a vast majority of applicants had secured
big or small plots for themselves. None had distinguished
themselves in any walk of life; nor were they needy. Similar is the
situation in the allotment of plots in Punjab. The lists attached with
various written statements show that a large number of persons
have been allotted plots in Urban Estates which are far away from
their residential area. The list attached by PUDA shows that large
number of persons have been allotted plots in various Urban
Estates in Punjab, although they are clearly stated to be residents of
Chandigarh, New Delhi or other large cities in Punjab. It clearly
goes to show that the allotment of the plots have not been made on
the basis of any discernible criteria.
”
19. In view of the authoritative pronouncement of the Full Bench of this
Court, which has unequivocally declared the policy of discretionary allotment of
residential plots to be ultra vires the Constitution and in blatant contravention of
the guarantee of equality enshrined under Article 14, the allotments made in favour
of the respondents–plaintiffs cannot be sustained in the eye of law. The controversy
raised herein stands fully concluded by the ratio laid down in Dr. Amar Singh
(supra), which has subsequently been reaffirmed by the learned Single Bench in
Gurdev Singh Sehmby (supra). When the law declared by a larger Bench oper-
ates as binding precedent ‘stare decisis et non quieta movere’ (To stand by decided
matters and not to disturb what is settled) the subordinate forums are duty-bound
to give full effect to it.
19.1. Accordingly, the appeals preferred by the appellant-Improvement
Trust deserve to be, and are hereby, allowed. As a necessary corollary, the judg-
ments and decrees passed by both the Courts below, being contrary to the settled
legal position and rendered per incuriam, are set aside.
RSA-1820-1995 (O&M) & -:23:-
RSA-2395-1998 (O&M)
20. In view of the fact that the main appeals have been finally dis-
posed of, all pending miscellaneous application(s), if any, shall also stand
disposed of accordingly, without any further orders.
21. A copy of this judgment shall be duly placed on the record of the
connected matter to facilitate ready reference and to ensure its effective
implementation and compliance in all consequential proceedings.
(
VIRINDER AGGARWAL )
17.11.2025 JUDGE
Gaurav Sorot
Whether reasoned / speaking? Yes / No
Whether reportable? Yes / No
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