Heard Sri T. Bala Mohan Reddy, learned counsel for v. Narasimha Goud, Iearned Standing

Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to direct the 2nd Respondent to consider the Legal Notice dated 21to'l2o1s got issued by the Petitioner. Counsel for the Petitioner: SRI T.BA|_A ITOHAN REDDY Counsel for the Respondent trl6.1:.Gp FOR MCPL ADMN & URBAN DEV. Couns,:l for the Respondent No.2: SRI V.NARASIUHA GOUD, SC FOR HMDA The Court made the following: ORDER i-it THt ITONOTTRABLE SRI JUSTICE TAFMI NARAYAIIA ALISHETTY IYRIT PE"IITION No.325O6 of 2O15 ORDER: This Writ Petition is filed to declare the action of respondent No.2 in not paying the compound interest @ 24 o/o per annum from L4.O9.2OO7 to 3O.07.2OI5 on Rs.5l,66,800l- paid by the petitioner, as arbitrary, illegal and unjustified.

2. Heard Sri T. Bala Mohan Reddy, learned counsel for petitioner and Sri V. Narasimha Goud, Iearned Standing Counsel for HMDA.

3. lrarned Counsel for the petitioner would submit that petitioner is native of Hubli, Karnataka and presently settled in USA and he is an NRI; that petitioner participated in the auction conducted by respondent No.2 on 14.09 .2OO7, for sale of open plots and the petitioner became highest bidder in respect of plot No.666/A, Miyapur Residential Complex, Miyapur, and paid the entire sale consideration of Rs.51 ,66,800 I - uide Challan Nos.1O068/ 2OO7-O8 dated 17.O9.2OOT for Rs.S,O0,OOOl-, IO255/2OO7-O8 dated 19.O9.2OO2 flor Rs.7,91,OOO/- and 45l2OO7-08 dated O1:1O.2OO7 for Rs.38,75,LOO/- towards plot cost as per the terms of auction, by obtaining loan from ICICI 1 ) .\ \ LNA,J W.P.No.32506 of 2015 2 Bank frlr an amount of Rs.48,oo,o0o/- and was paying monthly EMI of Rs.63,ooo /-; tt.at petitioner is under trre impression that auctioned plots are free from litigation as the same were auctioned by Government agency, however, surprisingly he came tc, know that respondent No.2 allottecl the said plot to D. Vrjaya .lyothi in the year 1990 i.e., much prior to the auction dated 1'+.o9.2oo7. rn fact, registered sale deed No.7g7g of 2015 was alsro executed in favour of D. vrjaya Jyothi. Despite paymen: o[ entire auction amount, respondent No.2 did not execute registered sale deed in favour of petitioner, therefore, the petitioner made several requests for execution of sale deed in his farour, however, the respondent No.2 did not execute the sale deect. 4- [rarned counsel for the petitioner would further submit that petir:ioner has requested respondent No.2 to allot alternate plot and srrbmitted representations dated 13.01 .2014 and 05-06.2014; that respondent No.2 offered plot No.960/l ro the petitioner, which is left over plot out of 30o acres developed b1, responderrt No.2 and is much inferior to that of the plor purchaserl by the pet.itioner in all aspects, therefore, petitioner informed the respondent No.2 that he is not interested in the LNA,J \V.P.No.32506 of 2015 3 said alternate plot and requested respondent No.2 to refund the amount paid by the petitioner i.e., Rs.5l,66,g00/_ along with compound interest @ 24 %o per annum. The respondent No.2 refunded the said amount of Rs.51,66,g00/- to the petitioner urde cheque bearing No.64lg3o dated 3o.07.201s, however, without any interest. Aggrieved by ttre same, present writ petition is filed.

5. Learned counsel for the petitioner principafly contended that petitioner has paid the auction arnount in the month of September, 2oor, whereas, respondent No.2 refunded the said amount on 30.o7.2015 i.e., after eight (0g) years, therefore, petitioner is entitled to compound interest as the petitioner has been put to financial loss and hardship because of the mistake on the part of respondent No.2 in auctioning non-existing plot No.666/A. He further contended that in similar circumstances, this court awarded interest @ l2o/o per annum and trrerefore, the petition is deserved to be allowed and the petitioner is entitled to compound interest@240/o per annum. In support of his contention, he reried upon the Judgment of this court passed in W.p.Nos.2 6g32 and 273LO of 2024, dated

02.05.2025. j ) LNA,J W.P.No.32506 of 2015 4

6. Per contra, learned counsel for respondent No.2 would submit that non-existence of plot No.666/A which was purchas'ed by the petitioner, was noticed by respondents and the sanre was promptly informed to the petitioner and also offered an alternate plot bearing No.96O/ 1 with the sarne extent and dirnensions with that of the plot purchased by the petition,:r. Learned Standing Counsel for respondent No.2 further submitted l.hat petitioner was not interested in taking alternate land, and as such, respondents refunded the entire amount paid by the petitioner on 30.O7.2015. Therefore, the contention of the petitioner that he is entitled to compound interest @ 24%o per annum is untenable and without any basis. He further submitted that orders passed in W.P.Nos.26832 and 27310 of 2024, which was relied upon by learned counsel for the petitioner has no application to the present case as the facts and cirr:umstances of that case and the present case are entirely different.

7. In support of his contention, Iearned Standing counsel for responclent No.2 relied upon the following Judgments: I LNA,J W.P.No.32506 of 2015 5 a) State of U.p and. Otlers ,s. Bridge & Roof eompang (India) Ltd,t b/ Assr'srant Excise commi.ssioner and. others r.rs. .Issac Peter and others2 c) W.A.No.8OB of 2024 dated 08.07.2024 i) The Hon'ble Apex court in state of a.p and oila,,rs (cited. 7"t supra) held that "writ petition -fired for issuance of a writ of mandamus restraining the Gouernment from d.educting or withhotding o. pafticurar sttm, uthich accord.ing to the respondent is payable to it under the contract, was uhollg misconeiued. and. utas not maintainabre in raw and. writ petition i.s ought to haue been d.i^smissed. on this ground. atone., iil The Hon'ble Apex court in Assistant Excise comrnissioner and otttcrs (cited 2ra supra), held. that ncontract between the parties is gouemed. bg stottttory proursions, i.e., prouisions of the Act, the Rures, the conditions of ricense and. tLe counterpart agreement, tleg constifitte the terms and. qnditions of tlrc contract. They are binding bothupon the Gouern4ent and tlqe licensee- Neit?er of them can depart from them. It is not open to ang offtcer of the Gouernment to eit?er ]trseoy 6scc22 '(re94)4SCC t04 modifg, amend, or alter 'l ) LNA,J W.P.No.32506 of 2015 6 th.e saiat. terms and conditions, not euen to the Minister of Excise. trt is, therefore, not reallg flecessary for tlrc present putpose to examine tthat precisely utas the statement made bg the Minister of Excise or by the auctioning authoities at tlrc time of auction." iii) A Flon'ble Division Bench of this Court in W.A.No.8O8 of 2024 clated 08.07.2024, held that "u?rcther tle rescission of the contract is arbitrary or Ls irrational or th.e pouer to rescind the contract has been exercised in consonanee uith the term,s and anditiorus of the contract d.epends upon adiudication of disputed qtestiorus of fact which cannot be gone into in a sumntary proeeding under Article 226 of the Constitution of India."

8. Learned Standing Counsel for respondent No.2 submitted that as per Pre-Final allotment dated 25.1o.2oo7, physical possession was supposed to be handed over on 3O.ll.2OO7, howevr:r, petitioner did not take possession despite informing specifi,:a11y, therefc)re, conveyance deed could not be executed in favour of the petitioner. He further submitted that for the delay and laches on the part of petitioner, respondent No.2 cannot be penali:red. He further submitted that auction and purchase of plots is purely a contract, therefore, writ jurisdiction under LNA,J llt. P. No. 3, 2 5 06 of 20 I 5 7 Article 226 cannot be invoked for adjudication gf complex contractual disputes or to grant money decrees. He further submitted that petitioner has en-cashed the cheque issued by respondent No-2 and has not challenged the validity of terms of auction, therefore, petitioner is estopped from seeking any relief including penal or compound interest. 9' Perusal of the record discroses that petitioner was the successful bidder in the auction conducted by respondent No.2 on 14.O9.2OO7, having agreed to pay Rs.2O,OOO/_ per square yard and paid the total sale consideration anrount of Rs'S1 ,66,800 / - subsequently, in the month of septemser, 2oor. Respondent No.2 rearized, that the prot No.666lA is not existing on the ground and the dimensions and the boundarfles of the said plot are in fact belongs to plot No.664lB, which was already handed over to Ms.D. vijaya Jyothi on 3o.0g.199s, therefore, respondent No.2 had offered alternate plot bearing No.96o/1, which is of same extent. However, the said offer was not accepted by the petitioner and requested responderrt No.2 to refund the entire amount paid by the petitioner. Accordingly, entire amount of Rs.5r,66,goo/- paid by the petitigner was refunded by the respondent No.2 on 3O.O7.2O15. \ \\ \ LNA,J W.P.No.32506 of 2015 8

10. T.ae grievance of the petitioner is that he has paid the auction amount to respondent No.2, by obtaining loan of Rs.48,00,OOO/- from ICICI Bank, and thus respondent No.2 is liable to pay compound interest @ 24% per annum as the amounl. was refunded by respondent No.2 after eight (O8) years.

11. In so far as maintainability of writ petition is concerned, it is relevant to note that the Hon'ble Apex Court in Unitech Limiteil alnd others Vs.Telangana State Industrial Infra.sl:tzltctrrrre Corporatiott (TSIIC) and others, wherein it was held as under:- "39. A two judge Bench of this Court in ABL International Ltd. u.Eryort Credit Guarantee Corporation of India IABL Intemationall analgzed a long line of precedent of this Court to conclude that wits under Article 226 are motintatnable for a.sserting contractual rights against th-e state, or its instntmentalities, as defined under Article 12 of tlte Indian Constitution.

39.'.1. Tlrc decision in ABL InternationaL cautions that th-e pler,-ary pou)er urtder Article 226 must be used with ciratm.spection ulrcn other remedies haue been prouided by ttrc contract. But as a statement of principle, the juri:;diction under Article 226 is not excluded in contractual matters.

39..t. If t?rc State instrumentality uiolates its constitutional mantdate under Article 14 to act fairlg and reasonably, relictf under the plenary powers of Article 226 of the Constittttion would lie. ,. ':\ LNA,J t/.P.No.32506 of 20t5 9

39.6. In determining as to wletlrcr the jurisdiction should be exercised in a oontractuat disputq the court must, undo-ubtedly esclew, di.sputed. qiestions of fact uthich would depend upon an euid.entiary d.eterminiti1" r"qrriiig a trial. But, equallg, it is utett s.itted that tle judaidioi under Arttcle 226 cannot be ousted. onlg on *i uas* ttut tle dispute pertains to *e contracfitar arena. rhis isfor fie stmple reason that tlrc state and. tts instrumentotiii" orl not exempt from the duty to act fairta mererg because in tteir business de-alings tieg haue entered. into tlrc realm of contract. similarly, ttrc presence of an qrbitration clausZ does (sic not) oust tlrc jurisdiction und"er Articte 226 in att cases thougla is sfil/ needs to be decided from case to case os to whether recourse to a pubtic iaw remedg can justifiablg be inuoked. "

12. Thus, it is clear from above decisions that writs under Article 226 are maintainable for asserting contractual rights against the state, or its instrumentalities, as defined under Article L2 of the Indian constitution. Therefore, the contention of learned Standing counsel for respondent No.2 that writ jurisdiction under Article 226 cannot be invoked for adjudication of complex contractual disputes, is untena,ble.

13. Now the point that arises for consideration of this court is whether the petitioner is entitled to compound intere st @ 24o/o per annum on Rs.S1 ,66,gOO/_. \- ) \ LNA,J W.P.No.32506 of 2015 t0 14. In the judgment relied upon by the petitioner, it is observr:d that where state or its instrumentalities are involved in aucl:ioning of the properties, there is a presumption that such properlies are free from encumbrances and there is also a reasonable and legitimate expectation that encumbrances, if any, shall be informed to the participants of the auction. This Court lurther observed that the State must act fairly and when the propert5r was not free from encumbrances and the same was never informed to the buyer and is unable to enjoy the fruits of the pr,rpert5r, the State shall refund the amount paid by the buyer and ultimately, directed the State to refund the auction amount along with interest@l8o/o per annum.

15. In the present case, admittedly, plot No.666/A, which was auctioned and purchased by the petitioner is non-existing plot and this fact was noticed by respondent No.2 after auction and the p:ryment of entire auction amount by the petitioner. Though alternative plot was offered by respondent No.2, the same ,vas not accepted by the petitioner as according to him, the alternative plot is the left over plot out of 30O acres land develolrggl-by respondent No.2 and also inferior in all aspects with that of the plot purchased by the petitioner in auction. III . LNA,J W.P.Noi32506 of 2015 II Therefore, this Court cannot find fault with the petitroner in not accepting the alternate plot offered by the respondent No.2. Ttre respondent No.2 had auctioned non_existing plot Nor666/A and therefore, there is clear mistake on the part of respondent No.2, which reflects non diligent approach on the part of respondent No'2' The judgments referred to and relied upon by the rearned standing counser for respondent No.2 have no apprication to the present facts and circumstances of the case. I \

16. Admittedly, respondent No.2 refunded the ilmount paid by the petitioner on 30-o7 -2015, which is about eight (og) years from the date of pa5rment by the petitioner, therefore, petitioner is put to financiar ross as we, as hardship and thus, petitioner rs entitred to interest from the date of payment dll the da,. of refund. Though, the petitironer claimed compound irrterest @ 24o/o pet annum, in considered opinion of this court ends of trre Justice would be met, if interest @ Lgo/oper annum is awarded to the pedtionir from the date of payment till the date of refund r.e., 3O.OZ.20lS. t ( L7 Accordingly, writ petition is a,owed in part, directing the 18 o/o per annUm on respondent No.2 to pay interest @ LNA,J W.P.No.32506 of 2015 t2 Rs.51,65,8OO/- to the petitioner from the date of payment till the datt: of refund. There shall be no order as to costs' Ntiscellaneous petitions pending, if arly, shatl stand closed. To, ,,TRUE COPYII

1. The Principal Secretary, Municipal 2 State of Telangana. The Metropotitan Commissioner, Hyderabad eutt,oriiv, dlock 'A, District Commercial Compl 5001)07, Telangana. REDDY REGISTRAR ECTION OFFICER , Hyderabad. ex, Tarnaka, Development Hyderabad -

3. one,CC to SRI T.BALA MoHAN REDDY, Advocate [oPUCl 4. One, CC to SRI V-NARASIMHA GOUD, SC FOR HMDA IOPUCI 5.TwcTCCstoGPFoRMCPLADMN&URBANDEV.,HighCourtfortheState of Tetangana at HYderabad [OUT]

6. Two CD CoPies BSR/DL I HIGH COURT u :1011012025 ORDER WP.No.32506 of 2015 ,l S }rt L) ?4 JAil 2M * * PARTL\T ALLOWING THE WRIT PETITION, WITHOIJT COSTS a\ef 1