THE BIHAR STATE HOUSING BOARD & ORS. versus RADHA BALLABH HEALTH CARE AND RESEARCH INSTITUTE (P) LTD. on 13 September 2019

SUPREME COURT REPORTS

[2019] 12 S.C.R.

ATHE BIHAR STATE HOUSING BOARD & ORS.

v.

RADHA BALLABH HEALTH CARE AND RESEARCHINSTITUTE (P) LTD.

(Civil Appeal No. 7243 of 2019)

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SEPTEMBER 13, 2019

[L. NAGESWARA RAO AND HEMANT GUPTA, JJ]

Public property: Allotment of plot – Advertisement of plot forhealth center by appellant – Respondent even though being theCsole applicant not allotted plot – Challenge to – In a writ petition,direction by the High Court to the appellant to consider respondent’sapplication – Appellant allotted two plots without any advertisement,in lieu of the plot advertised earlier – Respondent paid the amountdemanded by the appellant – Thereafter, writ petition by theDrespondent disputing the allotment price which was allowed by theSingle Judge of the High Court – Said order upheld – On appeal,held: Response to an advertisement does not lead to any obligationon the appellant to allot any plot – Mere fact that the respondenthad applied for allotment of a plot does not confer any legal orequitable right to seek allotment of any plot – Appellant was moreEthan indulgent in allotting two plots without any advertisement –Public property could not be disposed of without any advertisementand without giving opportunity to eligible persons to apply andseek consideration of allotment of public property in a transparentand non-discriminatory manner – Thus, the allotment of two plots,Fon the basis of direction given by the High Court to consider theclaim of the respondent, is against the public interest – However,the respondent has constructed hospital which is operational thus,the allotment cannot be cancelled – Action of the respondent todispute the allotment price after accepting the price is neither fairnor reasonable and cannot be accepted – Appellant as a State isGrequired to act fairly in fixation of price for allotment of a plot –Order of the High Court to direct the appellant to charge the priceproportionate to the price advertised earlier has no legal basis andis set aside.

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Allowing the appeal, the Court

HELD: 1.1 The respondent does not get any right ofallotment of a plot merely because it has applied for allotmentearlier. The response to an advertisement does not lead to anyobligation on the appellant to allot any plot. Admittedly, therewas no allotment in pursuance of the offer submitted by therespondent. Mere fact that the respondent had applied forallotment of a plot does not confer any legal or equitable right toseek allotment of any plot. The appellant was more than indulgentin allotting two plots of 24000 sq. feet without any advertisementadvertising such plots merely on the basis of the fact that therespondent had applied for allotment at an earlier stage in respectof another plot. The public property could not be disposed ofwithout any advertisement and without giving opportunity toeligible persons to apply and seek consideration of allotment ofpublic property in a transparent and non-discriminatory manner.[Para 25, 26] [456-E-G]

1.2 The very allotment of two plots, on the basis of directiongiven by the High Court to consider the claim of the respondent,is against the public interest. However, the fact remains that afterallotment, the respondent has constructed hospital which isoperational therefore; it is too late in the day to cancel theallotment of the plot allotted to the respondent. [Para 27][457-A-B]

1.3 The respondent has accepted the price on threeoccasions; firstly on March 21, 2014, then on April 2, 2014whereby, the respondent remitted a sum of Rs.40 lakhs by twocheques as well. The respondent has accepted the paymentschedule but subject to final measurements of plots. It isthereafter the letter of allotment was issued on December 11,2014. Thirdly, the respondent remitted another sum ofRs.1,71,00,000/- vide three separate cheques in January, 2015so as to complete 20% of the interim price of letter of allotmentdated December 11, 2014. It is thereafter an agreement wasexecuted on March 12, 2015 unequivocally and categoricallyaccepting the offer of the appellant. It was not open to therespondent to dispute the price of allotment offered by the A

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Aappellant. The respondent is estopped to dispute the allotmentprice in these circumstances. [Para 28] [457-C-D]

1.4 The appellant as a State is required to act fairly in fixationof price for allotment of a plot. The order of the High Court todirect the appellant to charge the price proportionate to the priceBadvertised earlier has no legal basis. It is a commercial decisiontaken by the appellant fixing the price of the plot. In the matterof fixation of price, the Board has a right to fix such price, moreso, when such price was accepted by the respondent on threedifferent occasions. The action of the respondent to dispute theallotment price after accepting the price is neither fair norCreasonable and cannot be accepted. [Para 30, 31] [457-C-D]

1.5 Keeping in view the cause of allotment of plot i.e.hospital, in exercise of jurisdiction under Article 142 of theConstitution, that the interest for the period from the date offiling of the writ petition before the High Court till the date ofDorder of this Court shall not be charged from the respondentprovided respondent pays the entire balance sale considerationin terms of the condition of allotment within the stipulated period.[Para 32] [459-A-B]

1.6 The order of the High Court is not sustainable in law,Ethus, the order is set aside. [Para 33] [459-C]

Akhil Bhartiya Upbhokta Congress v. State of MadhyaPradesh & Ors. (2011) 5 SCC 29 : [2011] 5 SCR 77 ;Institute of Law, Chandigarh & Ors. v. Neeraj Sharma& Ors. (2015) 1 SCC 720 : [2014] 11 SCR 1096 ;FMeerut Development Authority v. Association ofManagement Studies & Anr. (2009) 6 SCC 171 : [2009]6 SCR 663 ; Uttar Pradesh Housing and DevelopmentBoard v. Ramesh Chandra Agarwal (2019) 6 SCC554 ; Style (Dress Land) v. Union Territory, ChandigarhG& Anr.(1999) 7 SCC 89 : [1999] 1 Suppl. SCR 591- referred to.

THE BIHAR STATE HOUSING BOARD v. RADHA BALLABH HEALTHCARE AND RESEARCH INSTITUTE (P) LTD.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7243of 2019.

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From the Judgment and Order dated 21.11.2017 of the HighCourt of Judicature at Patna in L.P.A. No. 229 of 2017 in C.W.J.C. No,17694 of 2015.

Ranjit Kumar, Sr. Adv., Shivam Singh, Jaideep Khanna, GopalSingh, Advs. for the Appellants.

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Neeraj Kishan Kaul, Sr. Adv., Amit Kumar Singh, Mrs. E. EnatoliSema, Chanan Parwani, Gaurav Prakash, Advs. for the Respondent.

The Judgment of the Court was delivered by HEMANT GUPTA, J. 1. Leave granted.

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2. The challenge in the present appeal is to an order passed by theDivision Bench of the High Court of Judicature at Patna on November21, 2017, whereby, the Letters Patent Appeal against an order passedby the learned Single Bench on September 19, 2016 was dismissed.

3. The appellant published an advertisement on May 10, 2008inviting applications for allotment of plot for health center in Lohia NagarHousing Colony, Patna measuring 43000 sq. feet at the price ofRs.1,71,89,057/-. Rs.1,00,000/- was the earnest money. The respondentapplied for such plot along with the amount of earnest money. It wasmentioned in the advertisement that upon receipt of more than oneapplication, allotment shall be made by draw of lots and that theChairman-cum-Managing Director of the appellant has the power tocancel allotment without assigning any reason. The respondent hereinwas the sole applicant for seeking allotment of plot advertised for healthcenter but no such plot was allotted to the respondent, may be for thereason that the respondent being the sole applicant.

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A4. The respondent filed writ petition before the High Court in theyear 2009 challenging the action of the appellant in not accepting theapplication of the respondent for the reason that it had not submitted thedocuments of recognition from the State Government. In view of thestand taken, the High Court directed the appellant to take a decision onthe application of the respondent within a period of one month.BSubsequently, contempt petition was filed wherein; the Court wasinformed that the request of the respondent for allotment of plot was notaccepted. The respondent was given liberty to challenge the decision ofthe appellant by way of a fresh writ petition.

5. The respondent again filed writ petition before the High CourtCcontending that the respondent approached the Managing Director ofthe appellant, who agreed to the proposal of allotment of alternativeplots for construction of hospital in lieu of original plot offered, thoughwith much less area than the plot advertised earlier. The respondentsubmitted the technical and financial proposal also stating that the plot,Dwhich was advertised, was of an area of 43000 sq. feet for a considerationof Rs. 1,71,89,057/-, thus, there should be proportionate reduction ofprice on account of lesser area being offered. The respondent soughtallotment on the terms and conditions of the advertisement itself. Thetwo plots offered as alternative to the earlier plot, were plot nos. G-5and G-6 measuring an area of 10,000 sq. feet and 14000 sq. feetErespectively situated near Rajendra Nagar Over Bridge in Patna.However, the Board took a decision to allot the aforesaid plots on thebasis of Swiss Challenge Method. The said decision was communicatedto the respondent on December 14, 2011.

6. The said writ petition was decided on May 10, 2013 holdingFthat the advertisement cannot be given a go by adopting a method ofallotment other than what was described in the advertisement. As such,Swiss Challenge Method cannot be applied in the case of the respondent.However, change of plot was not interfered with in view of the fact thatthe respondent agreed for the offered plots. The appellant was directedGto consider issuing an allotment letter in favour of the respondent interms of the advertisement but with respect to plot Nos. G-5 and G-6 inplace of the original plot, as mentioned in the advertisement, on the sameterms and conditions with proportionate cost reduction on account of thearea of the plots having been reduced. The High Court passed thefollowing order:H

“In view of the reasons and discussions made above, the decisionof the board to allot the Plot Nos. G-5 and G-6 in favour of thepetitioner vide office order no. 160 of 2009 as contained in MemoNo. 10792 dated 09.12.2011 (Annexure-16) as also the LetterNo. 10871 dated 14.12.2011 (Annexure-17) on the basis of SwissChallenge Method is hereby quashed. The respondent – Board isdirected to consider the letter dated 3[rd] of January, 2012, writtenby the petitioner to the respondent-Board and on considering thesame, issue allotment letter in terms of the advertisement, ascontained in Patna High Court CWJC No.9744 of 2012 (5) 10Annexure – 1 with respect to the plot nos. G-5 and 6 in lieu of theoriginal plot as mentioned in the advertisement on the same termsand conditions with proportionate cost on account of the area ofthe plots being reduced.”

7. Such order was modified at the instance of the appellant onJanuary 9, 2014 that in view of the condition in the advertisement that ifthe allotment letter is issued after May 31, 2008, the price of the allottedplot will be on the updated rates as on the date of allotment. The Courtheld as under:

“It is submitted that advertisement states that if the allotment letteris issued after 31[st] May, 2008 the price of the allotted plot wouldbe on updated rate as on the date of allotment as per the terms ofadvertisement contained in Annexure-1 to the writ application.The order dated 10.05.2013 passed in CWJC No. 9947 of 2012 isclarified to the above extent. After such clarification it goeswithout saying that the Board upon considering the letter dated3[rd] January 2012 written by the petitioner is to issue the allotmentletter, and as such, the same be issued within a period of twomonths from today.”

8. It is thereafter on February 14, 2014, the respondent was calledupon to deposit up to date price of Rs.13,09,95,041/-. The said pricewas not deposited by the respondent, instead respondent replied videletter dated February 19, 2014 that the said demand is contrary to thedirection issued by the High Court and requested the Board to calculatethe updated price as per the terms and conditions.

9. On March 13, 2014, the appellant revised price toRs.10,58,91,736/- and raised demand for payment of such amount to be AB

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Adeposited by March 31, 2014. In response to such communication, therespondent on March 21, 2014 communicated its acceptance. The saidcommunication reads as under:

“With reference to your letter No. 1902 dated 13/3/2014 directingus to deposit Rs.10,58,91,736.00 for plot no. GC 5, GC 6,BKankarbagh Patna allotted to Radha Ballabh Health Care &Research Institute Pvt. Ltd.

We need to inform you that the Board may measure the exactArea of the Land to be delivered before the Representatives ofboth sides and thereafter handover the vacant possession of theCland erecting boundary wall, the cost of which shall be borne byus.

The amount (money), directed to be deposited for the said plotis against the directions of the Hon’ble High Court Patna. Wehave raised this issue of price in our letter dt. 19/02/2014 howeverDsubject to our right and without prejudice, we are ready to takethe land (Plt no. GC 5 & GC 6) Under protest.

We propose the following payment plan.

We will deposit a token advance of Rs. 40 lakhs at the outset.Once we get vacant possession of the land, with boundary wallEerected (the cost of which will borne by us) we will deposit up to20% of the total cost (subject to final measurement of the Land).

The remaining amount will be paid in Four Quarterly Installmentsper annum in three years. Once again we would emphasize thatif we do not get the vacant possession of the land within two (2)Fmonths of token advance deposit, the Housing Board shall beheld responsible and will have to bearing bank interest levied onus by the bank/borrower.

Kindly approve our proposal at the earliest and let us know yourbank with account number, so that we can proceed with theGpayment process.”

10. Again, the appellant sought the consent of the respondent onApril 1, 2014 seeking advance payment of Rs.40,00,000/- and that thebalance payment of Rs.8,47,93,330/- was payable in 12 quarterlyinstallments in three years. The communication of the appellant readsHas under:

“Reference:- Yours letter no.-zero dated 21.03.2014.

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Sir,

Review is made of your letter regarding aforesaid subject. Incourse of review for the payment, following payment list isprepared.

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(a) Total price on the date 31.03.2014 – Rs. Illegible.

(b) Advance payment – Rs.40,00,000/-

(c) Earlier deposited earnest amount-Rs.1,00,000/- (d)20 percent of total amount-Rs.2,11,98,400/-C

(e) Deducted advance payment and earnest amount-Rs.41,00,000/- (f)Rest preliminary amount to be deposited prior to deed ofagreement – Rs.1,70,98,400/- D

(g) Rest amount of the Price-Rs.8,47,93,330/- (h)Amount of instalment payable in 12 quarterly instalments inthree years-

(i) Normal with interest @14% Rs.87,74,750/- E

(ii) By delay with interest @18% Rs.92,98,962/- So if you are willing for the allotment in question, please giveyour consent on aforementioned schedule, otherwise it shall bedeemed that you are not willing for the allotment.”

11. The respondent communicated on April 2, 2014 accepting thepayment schedule under protest subject to final measurements of theplot. Such communication reads as under:

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“Ref: Housing Board’s Letter No. 2445 Dated 01/04/2014

Dear Sir,

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Received the Board’s aforesaid Letter regarding the paymentschedule for plot No. GC 5 & GC 6, Kankarbagh, Patna.

As stated earlier and in the light of our letter dt. 21/03/2014, weaccept the payment schedule, under Protest subject to the finalmeasurement of the plots.

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AWe are enclosing herewith two Banker’s cheques ofRs.40,00,000/- (Rs. Forty Lacs),

1. Banker’s Cheque no. 021879 for Rs.20,00,000/- (Rs.TwentyLacs) and

2. Banker Cheque No. 021880 of Rs.20,00,000/- (Rs.TwentyBLacs) Drawn at Patna dated 02/04/2014 as advance payment.

Please ensure the possession of Plot/Land, with boundary wallerected (at our cost) at its earliest.”

12. It is thereafter, a formal letter of allotment was issued onCDecember 11, 2014 acknowledging that Rs.41 lakh stand deposited andthat 20% of the interim price of the land amounting to Rs.2,11,98,400/-be paid within thirty days. Such amount was paid by the respondent. Itis thereafter, an Agreement was executed on March 12, 2015 betweenthe appellant and the respondent. Thus, a concluded contract came intoexistence with deposit of the amount demanded by the appellant andDpaid by the respondent.

13. After accepting the allotment on the price as per thecommunication referred to above, the respondent filed a writ petitiondisputing the allotment price. The learned Single Bench allowed thewrit petition on the basis that proportionate price of the plot advertised inELohia Nagar alone can be claimed by the appellant.

14. The High Court has sought the basis of fixation of price of theplot during the proceedings before it. The proportionate price claimedby the appellant was found to be arbitrary. The High Court, vide orderdated September 19, 2016, issued the following directions:

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“In my considered view, only that procedure could have beenfollowed for updation of price of allotment. Thus, it is held thatthe Board has acted in arbitrary manner in fixing the price of theplots concerned due to which the petitioner has been fastenedwith a liability to pay a price several times higher than whichGcould have been charged. It has also to be kept in mind that dueto the delay caused by the Board, the allotment could not befinalized on the date fixed. Accordingly, this writ petition is allowed.The price fixed by the Board is quashed and set aside. The Boardis directed to re-calculate the cost of the plots of the petitioner inaccordance with the procedure adopted under Annexure H

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appended with the counter affidavit within a period of three monthsfrom the date of receipt/production of a copy of this order andreturn the excess amount, if any, having been paid by the petitionerin terms of the calculation done by the Board. If the same is notdone within the aforesaid period of three months, the petitionerwould be entitled for interest @14% per annum on the said amountto be calculated from the date of expiry of the aforesaid period ofthree months till Patna High Court CWJC No.17694 of 2015 dt.19-09-2016 20/20 the date of final payment.”

15. In terms of the directions of the High Court, the appellant haspaid back a sum of Rs.3,31,94,435.53.

16. It is the said order of the learned Single Judge, which wasaffirmed in the Letters Patent Appeal, on the ground that the Boardcould only claim up to date rate and not the market rate as claimed in theletter of allotment.

17. The respondent in the counter affidavit in the present appealhas referred to the decision taken by the appellant in its 193[rd] Meetingdated February 10, 2000 on the basis of which office order was issuedon March 2, 2001 to fix reserve price for the purpose of auction of thePlots/Houses/Flats. The decision is as under:

“(i) The auction price of such Plots/Houses/Flats, having takenwithin one last preceding year.

(ii) The updated price of the Commercial rate fixed by the Board.

(iii) The rate prescribed by the Collector for the purpose ofRegistration.

In addition to this the Managing Director of the Bihar StateHousing Board was authorized to have discretion keeping theplace, time and circumstances.”

18. It is also pointed out that on June 13, 2013, the market valuewas determined for calculation of premium for the Financial Year 2013-2014 and that on the basis of such calculation, the price of the plot allottedhas been fixed.

19. Mr. Ranjit Kumar, learned senior counsel for the appellant,argued that the decision of the Appellant is based upon rational basis interms of the decision of the Board taken earlier. It is argued that after A

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Aaccepting the offer of allotment and paying initial amount, the respondentis estopped to dispute the allotment price.

20. The argument of Mr. Neeraj Kishan Kaul, learned seniorcounsel appearing for the respondent, is that the advertisement invitingapplications for allotment of plot contemplated charging of up to dateBcost/price which is not the same as market price, therefore, the appellantcannot charge market price of the plot. It was argued that the decisionof June 13, 2013 is in respect of sale of the plot by the allottee to thirdperson so as to pay 50% of the market value to the appellant. Therefore,such decision has rightly not been accepted by the High Court. It is alsoargued that office order dated March 2, 2001 deals with fixation of reserveCprice in the event of decision of the Board to auction the plot. Therefore,the High Court has rightly fixed price of the plot on the basis of calculationsgiven by the appellant alone. Thus, the order of the High Court does notwarrant any interference in an appeal under Article 136 of the Constitutionof India.D

21. We find that the entire approach of the High Court is erroneousand not sustainable. Plot Nos. G-5 and G-6 located in Rajinder NagarOver Bridge were never advertised. The allotment of the alternativeplots was made by the appellant in lieu of the plot advertised in LohiaNagar, Kankarbagh, Patna measuring 43000 sq. feet. The location andEthe size of the alternative plots are different.

22. Firstly, we need to examine as to whether, the appellant couldallot plots without advertisement. This Court in a judgment in AkhilBhartiya Upbhokta Congress v. State of Madhya Pradesh & Ors.[1]deprecated the practice of allotment of plots dehors an invitation orFadvertisement by the State or its instrumentalities. The Court held asunder:

“66. We may add that there cannot be any policy, much less, arational policy of allotting land on the basis of applications madeby individuals, bodies, organisations or institutions dehors anGinvitation or advertisement by the State or its agency/instrumentality. By entertaining applications made by individuals,organisations or institutions for allotment of land or for grant ofany other type of largesse the State cannot exclude other eligiblepersons from lodging competing claim. Any allotment of land or grant of other form of largesse by the State or its agencies/instrumentalities by treating the exercise as a private venture isliable to be treated as arbitrary, discriminatory and an act offavouritism and/or nepotism violating the soul of the equality clauseembodied in Article 14 of the Constitution.

67. This, however, does not mean that the State can never allotland to the institutions/organisations engaged in educational,cultural, social or philanthropic activities or are rendering serviceto the society except by way of auction. Nevertheless, it isnecessary to observe that once a piece of land is earmarked oridentified for allotment to institutions/organisations engaged in anysuch activity, the actual exercise of allotment must be done in amanner consistent with the doctrine of equality. The competentauthority should, as a matter of course, issue an advertisementincorporating therein the conditions of eligibility so as to enable allsimilarly situated eligible persons, institutions/organisations toparticipate in the process of allotment, whether by way of auctionor otherwise. In a given case the Government may allot land at afixed price but in that case also allotment must be preceded by awholesome exercise consistent with Article 14 of the Constitution.”

23. In another judgment in Institute of Law, Chandigarh & Ors.v. Neeraj Sharma & Ors.[2], this Court upheld the order of the HighCourt setting aside allotment of land in favour of the appellant institutewithout giving any public notice and in the absence of a transparentpolicy and any objective criteria.

24. Further, in Meerut Development Authority v. Association ofManagement Studies & Anr.[3], this Court held that a tender is an offer.It is an invitation to seek communication to convey acceptance. ThisCourt held as under:

“26. A tender is an offer. It is something which invites and iscommunicated to notify acceptance. Broadly stated it must beunconditional; must be in the proper form, the person by whomtender is made must be able to and willing to perform hisobligations. The terms of the invitation to tender cannot be opento judicial scrutiny because the invitation to tender is in the realm 2 (2015) 1 SCC 720

3 (2009) 6 SCC 171

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of contract. However, a limited judicial review may be availablein cases where it is established that the terms of the invitation totender were so tailor-made to suit the convenience of any particularperson with a view to eliminate all others from participating in thebidding process.

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B27. The bidders participating in the tender process have no otherright except the right to equality and fair treatment in the matterof evaluation of competitive bids offered by interested persons inresponse to notice inviting tenders in a transparent manner andfree from hidden agenda. One cannot challenge the terms andconditions of the tender except on the abovestated ground, theCreason being the terms of the invitation to tender are in the realmof the contract. No bidder is entitled as a matter of right to insistthe authority inviting tenders to enter into further negotiations unlessthe terms and conditions of notice so provided for such negotiations.

28. It is so well settled in law and needs no restatement at ourDhands that disposal of the public property by the State or itsinstrumentalities partakes the character of a trust. The methodsto be adopted for disposal of public property must be fair andtransparent providing an opportunity to all the interested personsto participate in the process.”

E25. Therefore, the respondent does not get any right of allotmentof a plot merely because it has applied for allotment earlier. The responseto an advertisement does not lead to any obligation on the appellant toallot any plot. Admittedly, there was no allotment in pursuance of theoffer submitted by the respondent. Mere fact that the respondent hadFapplied for allotment of a plot does not confer any legal or equitable rightto seek allotment of any plot.

26. The appellant was more than indulgent in allotting two plots of24000 sq. feet without any advertisement advertising such plots merelyon the basis of the fact that the respondent had applied for allotment atGan earlier stage in respect of another plot. The public property could notbe disposed of without any advertisement and without giving opportunityto eligible persons to apply and seek consideration of allotment of publicproperty in a transparent and non-discriminatory manner.

27. Therefore, the very allotment of two plots, on the basis ofdirection given by the High Court to consider the claim of the respondent,is against the public interest. However, the fact remains that afterallotment, the respondent has constructed hospital which is operationaltherefore; it is too late in the day to cancel the allotment of the plotallotted to the respondent.

28. The question raised before the High Court was whether theappellant is entitled to updated price or the market price. We find thatsuch discussion by the High Court is totally irrelevant inasmuch as therespondent has accepted the price on three occasions; firstly on March21, 2014, then on April 2, 2014 whereby, the respondent remitted a sumof Rs.40 lakhs by two cheques as well. The respondent has acceptedthe payment schedule but subject to final measurements of plots. It isthereafter the letter of allotment was issued on December 11, 2014.Thirdly, the respondent remitted another sum of Rs.1,71,00,000/- videthree separate cheques in January, 2015 so as to complete 20% of theinterim price of letter of allotment dated December 11, 2014. It isthereafter an agreement was executed on March 12, 2015 unequivocallyand categorically accepting the offer of the appellant. It was not opento the respondent to dispute the price of allotment offered by the appellant.The respondent is estopped to dispute the allotment price in thesecircumstances.

29. Recently, in a judgment of this Court in Uttar Pradesh Housingand Development Board v. Ramesh Chandra Agarwal[4], the appealwas allowed against an order passed by the National Consumer DisputesRedressal Commission for allotment of a plot for the reason that thecomplainant has applied for allotment of a plot way back in 1982. It washeld that there was no contractual entitlement for allotment of a flat at aspecified price. The Court held as under:

“13. The appellant is governed by the terms and conditionsadvertised in its Registration Booklet and by the 1979 Rules. Clause5 of the Registration Booklet indicates that mere registration doesnot confer a right for allotment. Rule 15 makes a provision to theeffect that the Board is not bound to allot a house or plot to everyregistered holder. Rule 30 indicates that after the Board advertisesthe availability of a scheme in the newspaper, every registered AB

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Aapplicant is at liberty to submit a consent letter for participation inthe draw of lots. Mere registration does not oblige the authority toinclude every registered applicant in the draw of lots.The applicantmust show readiness and willingness to participate in a draw oflots in respect of a specified scheme. This is evident from Rule30(2). A set of priorities is provided in Rule 30(5). In view of theBclear position in the brochure and the 1979 Rules, the respondenthad no vested right to seek an allotment. As a registered applicant,the respondent was at liberty to seek to participate in the draw oflots by indicating his consent to the appellant.After paying aninitial sum of Rs 500 in 1982 and a further sum of Rs 500 in 1985,Cthe respondent did not pursue any remedies until 1993 when hemoved the District Forum. The order of the District Forum gaveliberty to the respondent to seek allotment at the current marketvalue under any of the schemes of the appellant. NCDRC wasmanifestly in error in issuing a direction to the appellant to makean allotment to the respondent for a total sum of Rs 2,50,000 inDany of the flats available in the Mandola Vihar Yojna, Ghaziabad.There is no rational basis or justification for the amount of Rs2,50,000 which has been fixed by NCDRC. This direction proceedspurely on the basis of the ipse dixit of the forum. The appellant, asa public authority, could not have been compelled to enter into aEcontract with the respondent. There was no contractual entitlementof the respondent to the allotment of a flat much less for anallotment at a specified price.In its effort to renderjustice, NCDRC has adopted a view which is contrary to the basicprinciples of contract governing the law on the subject.”

(emphasis supplied)

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30. The appellant as a State is required to act fairly in fixation ofprice for allotment of a plot. The order of the High Court to direct theappellant to charge the price proportionate to the price advertised earlierhas no legal basis. It is a commercial decision taken by the appellantGfixing the price of the plot. In the matter of fixation of price, the Boardhas a right to fix such price, more so, when such price was accepted bythe respondent on three different occasions as mentioned above.

31. The action of the respondent to dispute the allotment priceafter accepting the price is neither fair nor reasonable and cannot beHaccepted.

32. In terms of judgment of this Court in Style (Dress Land) v.Union Territory, Chandigarh & Anr.[5], the appellant is entitled to theallotment price along with interest on the delayed payment even if thereis stay by the Court. But, keeping in view the cause of allotment of ploti.e. hospital, we order, in exercise of our jurisdiction under Article 142 ofthe Constitution, that the interest for the period from the date of filing ofthe writ petition before the High Court till the date of order of this Courtshall not be charged from the respondent provided respondent pays theentire balance sale consideration in terms of the condition of allotmentwithin six months from today.

33. In view of the above, we find that the order of the High Courtis not sustainable in law, thus, the order is set aside. The appeal isaccordingly allowed.

Nidhi Jain

Appeal allowed.

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