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Synopsis

The Supreme Court recently set aside a Punjab and Haryana High Court judgment that allowed a writ petition challenging the cancellation of a lease deed for a plot in Chandigarh. The cancellation occurred after the allottees repeatedly failed to settle outstanding dues despite being given ample opportunities.

A bench of Justices Bela M Trivedi and Satish Chandra Sharma noted that undisputedly the original allotment made in favour of the allottees – Manjit Kumar Gulati and Ors was cancelled by the Assistant Estate Office by the order of November 20, 1991 after affording sufficient opportunity of hearing to the allottees by issuing show cause notice on September 14, 1990 however, the allottees had failed to clear the outstanding dues.

The court also recorded in the appeal preferred by the said allottees, the Chief Administrator, Chandigarh, considering the submission made by the allottees, had given the allottees last opportunity to liquidate their liability and retain the lease of the site in question by paying the entire amount of premium with interest etc, within 15 days from the date of the passing of the order of October 12, 1992. The respondents- allottees instead of complying with the said order preferred a petition before the Advisor to the Administrator UT, Chandigarh after a delay of about five and half years, which also came to dismissed by the Advisor, by the order on April 07, 1999 on the ground of being time barred.

The court also pointed out similar challenge made by the the so-called tenant of the said allottees i.e., M/s Mohit Medicos also came to be dismissed by the Advisor.

"Under the circumstances, despite sufficient opportunities of hearing given to the allottees to clear the outstanding dues, the respondents – allottees had failed to clear the same. Hence, the High Court had committed gross error in allowing the writ petitions by holding that the tenant, i.e., M/s Mohit Medicos was not served with the notice of resumption with regard to the plot in question," the bench said.

The court also noted that admittedly there was no document whatsoever produced by the said alleged tenant to show that it was the tenant of the original allottees - Manjit Kumar Gulati and Ors.

When the original allottees themselves had failed to comply with the conditions of auction sale, and when the allotment itself made in favour of the said allottees was cancelled by the Statutory Authority after following the due process of law, i.e., by issuing show cause notice before cancellation of allotment, and when number of opportunities of hearing were given to the allottees to clear the outstanding dues, there was no question of serving any notice to the so called tenant, M/s Mohit Medicos, especially when there was nothing on record to suggest that M/s Mohit Medicos was the tenant of the original allottees - Manjit Kumar Gulati and Ors, the bench said.

"The High Court had completely lost sight of the said factual aspects of the matter while allowing the writ petitions filed by the respondents – allottees and the so called tenant – M/s Mohit Medicos," the bench said.

The court opined that M/s Mohit Medicos by no stretch of imagination could be said to be a tenant of the original allottees, in absence of any material placed on record, to substantiate the same.

"The litigation carried forward by the said alleged tenant is nothing but a proxy litigation on behalf of the original allottees, who were the defaulters and an abuse of process of law," the bench said.

The court allowed the appeal filed by Chandigarh Administrator and others and set aside the impugned order of the High Court for being erroneous.

Case Title: Chandigarh Administrator & Ors & Etc Etc Vs Manjit Kumar Gulati & Ors Etc