M/s.Krishnan Wood Works v. Tamilnadu Small Scale Industrial Development Corporation Limited

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 13.02.2008CORAMTHE HONOURABLE MR.JUSTICE S.MANIKUMARW.P.No.3913 of 2000M/s.Krishnan Wood Works rep. by its PartnerDayalal K.Patel46/4-A, Byepass Road,Ariyamangalam, Trichy – 620 010 ... Petitionervs.1. Tamilnadu Small Scale Industrial Development Corporation Limited, rep. by its Chairman-cum-Managing Director, Paulwel's Road, Kathipara Junction, Chennai – 600 016.2. Tamilnadu Small Scale Industrial Development Corporation Limited, Trichy Branch, rep. by its Branch Manager, Ariyamangalam, Trichy – 620 010. ... RespondentsWrit petition is filed under Article 226 of the Constitution ofIndia praying for issuance of a Writ of certiorarified mandamus tocall for the records relating to the proceedings made in LetterNo.4630/IE-6/95 dated 11.05.98 by the first respondent and quash thesame and direct the respondents to hand over possession of the plotbearing Nos.16 and 17 Thiruverambur Industrial Estate, Thiruverambur,Trichy without insisting on payment of enhanced cost.For Petitioner : Mr.C.B.Santhosh KumarFor Respondents : Mr.S.Ramalingam, SIDCO- - - - - ORDERThe petitioner, has sought for a Writ of Certiorarified mandamusto call for the records relating to the proceedings made in LetterNo.4630/IE-6/95 dated 11.05.98 by the first respondent and quash the https://hcservices.ecourts.gov.in/hcservices/ same and direct the respondents to hand over the possession of theplot bearing Nos.16 and 17, Thiruverambur Industrial Estate,Thiruverambur, Trichy without insisting on payment of enhanced cost.2. Facts leading to the writ petition are as follows:- The petitioner is carrying on business in manufacturing woodenfurnichers, doors and also running saw-mills. The petitioner has madean application on 22.06.1995 to the first respondent for allotment ofa developed plot in Thiruverambur Industrial Estate, Trichy and he hasalso remitted a sum of Rs.1000/- towards Earnest Money Deposit.Pursuant to the said application, the first respondent has passed anorder on 06.06.1995 and allotted a vacant land in plot Nos.16 and 17admeasuring an extent of 2.12 Acres in Thiruverambur IndustrialEstate. The cost of the land was Rs.2,01,000/-. Apart from that, thepetitioner was directed to pay a sum of Rs.10,050/- towards servicetax, at the rate of 5%. The total cost of the land with service taxwas Rs.2,11,050/-. The allotment order was valid upto 03.06.1995 andthe petitioner was directed to pay the said amount on or before31.05.1996. Pursuant to the order, the petitioner remitted a sum ofRs.2,11,050/- on 13.09.1995, in receipt No.96171 to the secondrespondent. 3. Thereafter, the second respondent by his proceedings dated03.01.1996, directed the petitioner to produce six copies of buildingplan, SSI Certificate and financial tie-up letter from his Bankers.Accordingly, the petitioner has produced the relevant documents to thesecond respondent. On the strength of the allotment order, thepetitioner also invested a sum of Rs.4,50,000/- towards purchase ofmachinery. Since the respondents have failed to hand over possessionof the plots, the petitioner made several requests to the secondrespondent to hand over possession of the plot. In the meanwhile, thefirst respondent by his letter dated 11.05.1998 enhanced the cost ofthe plot from Rs.2,01,000 to Rs.7,55,400/- and correspondinglyincreased the service tax from 10,050 to 37,770/-. Altogether, thefirst respondent enhanced the cost of the plot to Rs.5,54,400/-. Onthe basis of the above said letter, the first respondent has directedthe petitioner to pay a sum of Rs.5,82,120 being the difference inPlot Cost on or before 20.06.1998, as a condition precedent to handover the plot. In response to this, the petitioner has sent a letterdated 28.05.1998 requesting the respondents to cancel the revisedprice of the plot and also hand over the possession of the plot.However, by proceedings dated 21.12.1998, the first respondent refusedto reduce the cost of the plot. Apprehending cancellation of the plotmade in favour of the petitioner for non-payment of the final cost ofthe plot and aggrieved by the enhancement, the petitioner haspreferred this writ petition for the aforesaid relief. 4. Assailing the impugned order, the petitioner has contended that https://hcservices.ecourts.gov.in/hcservices/ the first respondent has failed to give sufficient opportunity to thepetitioner before enhancing the cost of the plot after receiving theoriginal cost of the plot, within the stipulated time prescribed inthe allotment. He has further stated that he has no jurisdiction toenhance the cost of the plot. It is also the contention of thepetitioner that the first respondent has failed to consider that thereis no specific provision in the allotment order dated 06.06.1995 toenhance the cost of the building. On the other hand, the cost of thebuilding fixed by the respondents was valid only upto 30.06.1995. 5. The respondents in their counter affidavit, have stated thatoriginally the cost of the land was fixed at Rs.2,01,000/- and it isnot a final cost. It is also the contention of the respondents thatdevelopment charges are included in the cost of the land andtherefore, the enhancement is justified. 6. Heard the learned counsel appearing for the parties and perusedthe materials available on record.7. In similar circumstances, this Court had already tested thecorrectness of an order passed by the first respondent dated08.01.1998, enhancing the land cost. The petitioner therein soughtfor a direction to quash the order of the Tamil Nadu Small ScaleIndustries Development Corporation represented by its Branch Manager,Hari Mills, demanding enhanced land cost with service tax. Onconsideration of the rival submissions, by order dated 30.10.2006, inW.P.No.5346 of 1998 this Court has passed the following orders. "7. Now, the fact remains that the petitioner paidthe amount as stated in the original order of allotmenton or before 30.03.1996 along with interest and therespondents accepted the same. Even in the consequentialorder dated 18.09.1997, the second respondent referred tothe order of the first respondent dated 28.03.1996 andrequired the petitioner to give an undertaking that hewould pay the difference in costs of the shed, which isstated to be Rs.1,65,600/-. As already stated, since thepetitioner is aggrieved by the demand made by the secondrespondent, they moved this Court and obtained an interimorder,8. The matter was argued on merits for some time.This court directed learned counsel for the respondentsto get instructions as to what is the stage in which thematter stands now and whether the respondents are wilingto hand over possession, if the petitioner pays thedifferential amount with a reasonable interest. Learnedcounsel for the respondents has stated across the Barafter consultation that the respondents are willing to https://hcservices.ecourts.gov.in/hcservices/ accept the amount and hand over possession, as theproperty is still available with them in view of thependency of the litigation. Learned counsel for thepetitioner, having regard to the increase in land costnow to several manifold, has agreed to pay Rs.1,65,600/-with 9% interest from 08.01.1998 till date of payment."8. The facts in the present case and the issue decided by thisCourt in the above unreported judgment are similar and therefore,following the said order, the impugned order enhancing the cost of theplot and the demand made by the second respondent are arbitrary andliable to be set aside. Accordingly, the impugned order dated11.05.1998 is set aside and the writ petition is allowed. No costs.Sd/Asst.Registrar/true copy/Sub Asst.RegistrarjrlTo1. The Chairman-cum-Managing Director, Tamilnadu Small Scale Industrial Development Corporation Limited, Paulwel's Road, Kathipara Junction, Chennai – 600 016.2. The Branch Manager, Tamilnadu Small Scale Industrial Development Corporation Limited, Trichy Branch, Ariyamangalam, Trichy – 620 010. +1cc to Mr.S.Ramalingam, Advocate Sr 7364+1cc to Mr.C.B.Santhosh Kumar, Advocate Sr 7154GB (CO)km/12.6.W.P.No.3913 of 2000