M/S SLV SAW MILLS AND WOOD INDUSTRIES v. SHWETHA RAGHAVENDRA COURT OF KARNATAKA 1 . KARNATAKA INDUSTRIAL AREAS DEVELOPMENT BOARD

Judgment

#1. The Petitioner is before this Court seeking for the following reliefs: i. A writ of certiorari or any other writ quashing the impugned cancellation letters bearing no. IADB/HO/ALLOT/AS/18578/4595/15-16 6th and No. IADB/HO/ALLOT/AS/18578/12776/15-16 dated 11th December 2015 (Annexure-V) (Annexure-N) 2015 July - 3 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR ii. Direction to the R1 to restore the allotment of 6 No. IADB/HO/ALLOT/AS-2/18578/1114/09-10 dated 14th December 2009 (Annexure-C) on the terms in the said and conditions as mentioned Allotment Letter. bearing letter iii. As a consequence of the above, declare that any lease cum sale agreement that is entered into by the 3rd Respondent with the 1st Respondent as void ab initio. iv. Grant such other further reliefs that may be prayed for during the course of the oral arguments with the kind leave of this Hon’ble Court, on obtaining the documents from the 1st and 2nd Respondent under Information Act. the Right

#2. The Petitioner claims to be a proprietary concern established for manufacturing and dealing with wooden furniture and allied wood products in the year 1908, with the fourth generation continuing the business. The Petitioner wanted to expand business using the latest technology. The Karnataka Udyog Mitra (hereinafter for brevity referred to as ‘KUM’) had held a global investors' meet where the Petitioner submitted its project report to establish an industry for manufacturing wooden furniture on six acres of land in Bidadi Industrial Area, which came to - 4 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR be approved by the Single Window Agency on

12.11.2009.

#3. The Land Audit Committee took note of the land utilisation details of the Petitioner and submitted it to the KUM and agreed to consider the allotment of six acres in Plot Nos.34, 35 and 36 of Bidadi's IInd Phase Industrial Area and directed the Petitioner to make payment of the balance amount of Rs.3,74,40,000/-.

#4. The Petitioner thereafter arranged finances to make payment. Accordingly, on 08.03.2010, the Canara Bank had sanctioned a loan of Rs. 8,07,00,000/- for the cost of land and construction of the building, as also purchase of machinery.

#5. The Petitioner, on inspection of the land, found that the area was yet to be developed, there were certain problems unsolved and as a result withheld the - 5 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR payment of the balance amount. The Respondent- KIADB, vide its letter dated 27.09.2010, on its own without any request made by the Petitioner, granted extension of time for payment of the balance amount with interest at the rate of 12.75% from 14.06.2010.

#6. The Petitioner on 23.10.2010 wrote to the KIADB about the lack of development in the allotted land, reiterating that the funds were available and would be so paid once the development was completed by the KIADB. Instead of replying to the allegations made by the Petitioner, the KIADB, vide its letter dated 23.10.2010, granted an extension of 10 days' time to make payment of the balance amount. The bank also wrote to the KIADB on 29.11.2010, stating that the balance amount was ready to be paid, and called upon the Respondent No.1 to arrange for a site visit to complete some formalities. - 6 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

#7. The Petitioner and Chief Manager of Canara Bank are stated to have visited the plots on 05.04.2011, when the plots could not be located. Further, they also found that agricultural activities were being carried out in many of the lands and as such, these were brought to the notice of KIADB and KUM vide its letter dated 05.04.2011. The Petitioner contended that the Petitioner had invested in the project, as well as the plant and machinery, had called upon KIADB and KUM to give a status report on the allotted plot vide its letter dated 05.04.2011.

#8. The KIADB vide its letter dated 06.07.2011, again granted an extension of time up to 16.08.2011 to make payment of the monies, but had withdrawn the request/demand for interest. The Petitioner vide its letter dated 25.09.2012, brought to the notice of the KIADB and KUM that there were agricultural activities being carried out and requested the KIADB to make available the said land. On 19.03.2013, the KIADB - 7 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR acknowledged that there were certain issues related to the allotted lands, but did not make any commitment on when those issues would be sorted out.

#9. The Petitioner thereafter submitted various representations to the KIADB, seeking a status report on the said lands. No such status report was furnished. However, on 06.07.2015, the KIADB cancelled the allotment in favour of the Petitioner on the ground that the Petitioner had failed to make payment of the balance amount within the stipulated time period. In reply, the Petitioner on 10.07.2015 wrote to the KIADB and KUM that the cancellation was uncalled for; the amounts were already sanctioned by the Bank and were available with the Bank to be processed for payment immediately. It is only on account of the development works not being done by the KIADB that the matter could not be - 8 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR resolved. The Petitioner again, on 17.07.2015, wrote to the KIADB about the aforesaid issues.

#10. No action having been taken, it is alleged that the Petitioner was shocked to learn that the KIADB had allotted two acres of land from the said plots to Respondent No.3-Magtel Power Systems Private Limited (hereinafter referred to as ‘Magtel’) vide allotment letter dated 16.07.2015. The Petitioner approached the Chief Secretary, Government of Karnataka, vide letter dated 28.07.2015. The Chief Secretary made a note on the letter stating that the cancellation by Respondent No.1- KIADB was sudden and it needs to be verified, and further directed that there should be no allotment to any other company in the plots allotted to the Petitioner until the matter was resolved. - 9 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

#11. The KIADB breached the direction of the Chief Secretary and gave the luxury of choice to Magtel to choose from in Plot Nos. 34, 35 and 36 as to where the said 2 acres is to be allotted. Subsequently, the KIADB, vide its letter dated 03.08.2015, withdrew the cancellation dated 06.07.2015. However, reduced the allotment from 6 acres to 3.75 acres for a sum of Rs.01,98,90,000/- with the terms and conditions of the allotment letter dated 14.12.2009 being unaltered.

#12. On 11.12.2015, the KIADB cancelled the allotment letter dated 03.08.2015 on the ground that the Petitioner was not interested in implementing the project. Thereafter, the Petitioner made several representations for the restoration of the allotment of 6 acres of land to the Petitioner. The KIADB, vide its letter dated 22.03.2016, demanded the return of the - 10 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR original allotment dated 14.12.2009 so as to refund the amounts paid by the Petitioner.

#13. Being suspicious about the conduct of the KIADB, the Petitioner filed an application under the Right to Information Act to inspect the files relating to the aforesaid Plot Nos.34, 35 and 36. A Partial inspection was made available, and on such inspection, it was found that there were certain disputes ongoing on the plots allotted to the Petitioner by the land losers, alleging that no compensation was paid by the KIADB.

#14. The records indicated that there are no developments in the plots allotted to the Petitioner. No roads or drains were constructed. The land losers prevented the Petitioner from entering their allotted plots and stopped the KIADB undertaking development work. It is only in the month of January - 11 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR 2015 that the land losers’ dispute was resolved, and that the land losers were compensatorily allotted the possession of Plot Nos. 34, 35 and 36 of the said project.

#15. MAGTEL-Respondent No.3 was allotted Plot Nos.23 at the Bidadi Industrial Area. As the KIADB did not have to give possession to MAGTEL, an alternative plot was allotted to MAGTEL, in the plot allotted the Petitioner on 16.07.2015, possession certificate was issued on 28.08.2015, and a lease-cum-sale agreement was executed on

21.09.2015. It is in that background that the Petitioner is before this Court seeking for the aforesaid reliefs.

#16. Sri. Pramod Nair, learned Senior Counsel appearing for the Petitioner, would submit that: - 12 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

16.1. The land allotted to the Petitioner in Plot Nos.34, 35 and 36 was never developed. The Bank that had sanctioned the loan did not make payment of the amounts already sanctioned to the KIADB on account of the development work not having happened. The Bank had categorically indicated that it would make payment of the cost of the land to the Board upon completion of the development work and necessary documentation. The KIADB not having done the needful, the Bank did not make payment of the monies.

16.2. The KIADB has never addressed these issues raised by the Petitioner or the Bank, but has only extended time for payment. There is an acknowledgement on the part of the KIADB on

19.03.2013 that there are issues to be resolved as regards the lands allotted to the Petitioner. Despite the Chief Secretary having directed that - 13 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR no allotment is to be made, the KIADB has gone ahead with allotment of portions of the property previously allotted to the Petitioner. Having done so, an allotment letter dated 03- 08-2015 was issued reducing the allotted area of the Petitioner to 3.75 acres.

16.3. There is a reciprocal obligation on the part of the KIADB to provide infrastructure facilities. It is only after the infrastructure facilities are developed that the Respondent No.1 could allot plots. In the present case, an allotment has been made without the KIADB developing the industrial estate.

16.4. In another proceedings in WP No.50659/2012 by M/s.Ambience Infrastructure, this Court has accepted that there is no development which has happened. The said Ambience Infrastructure having contended so in their petition. There is no - 14 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR obligation on the part of the Petitioner to make payment of the balance amount until KIADB has complied with its obligation in terms of Section 51 of the Contract Act, 1872.

16.5. He relies upon the decision of the Hon’ble Apex Court of Nathulal vs. Phoolchand1, more particularly para no. 12 thereof, which is reproduced hereunder for easy reference:

#12. In considering whether a person is willing to perform his part of the contract the sequence in which the obligations under a contract are to be performed must be taken into account. The argument raised by Mr Shroff that Nathulal was bound to perform the two conditions only after the amount of Rs 21,000 was paid is plainly contrary to the terms of the agreement. By virtue of Section 4 of the Transfer of Property Act the chapters and sections of the Transfer of Property Act which relate to contracts are to be taken as part of the Indian Contract Act, 1872. If, therefore, under the terms of the contract the obligations of the parties have to the performed in a certain sequence, one of the parties to the contract cannot require compliance with the obligations by the other party without in the first instance performing his own part of the contract which in the sequence of obligations is performable by him earlier. 1 (1969) 3 SCC 120 - 15 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

16.6. By relying on Nathulal's case, he submits that the obligations of the parties have to be performed in a certain sequence. One of the parties contract cannot require compliance with the obligation of the other party without, in the first instance, performing their own part of the contract. Thus, the KIADB could not have insisted that the Petitioner make payment of the balance amount without the layout having been developed by the KIADB.

16.7. He relies upon the decision of this Court in the case of M/s. Kapsi Power Products vs. Chief Executive Officer, KIADB2, more particularly paras nos. 10 and 13, thereof which are reproduced hereunder for easy reference:

#10. At the time of final hearing, it was represented by the learned counsel for the petitioner that the construction of the building is complete and that the plant is yet to be commissioned. for any industrialist to take up any development work in an is well nigh impossible It 2 WP 16982/2017 - 16 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR industrial plot, without the basic infrastructure, such as, electricity and water. It is difficult for an individual to procure a dedicated electrical line or a water line for its industrial plot. The respondent No.1 which is endowed with statutory duty, to promote industrial growth, and thereby generate employment, cannot disown its responsibility in providing the basic infrastructure. It is bound to supervise at every stage, the progress of the industrial unit and attempt implementation of industrial unit. It would be of no benefit to an industrialist, to keep an industrial plot idle, as he would get title to the property only after the project is commissioned. This is therefore, a classic case of Governmental apathy, putting to risk the interest of an individual and retarding industrial growth. remedy any retards

#13. Consequently, this writ petition is allowed the impugned order bearing No.KIADB/HO/ALLOT/17936/ 19302/2016-17 dated 17.03.2017 passed by respondent No.1 to the extent of demanding a sum of Rs.1,51,37,002/- from the petitioner is quashed. The petitioner is granted one year time from today to commission the unit and start commercial production. The respondent No.1 to 3 are directed to provide all necessary assistance to the petitioner for implementation of the project, failing which, the concerned officer shall personally be held liable for any delay in implementation of the project. If the unit is not commissioned within one year, the respondents are at liberty to take such measures as are available in law.

16.8. By relying on Kapsi Power Products’ case, he submits that there is a statutory duty on the part of the KIADB to promote industrial growth and generate employment. The Court in that case found that there was apathy on the part of the Government, putting at risk the interest of an individual regarding industrial growth, and - 17 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR as such quashed the order of the KIADB demanding certain amounts from the allottee therein and directed the KIADB to provide all necessary assistance for implementation of the project. He submits that the interest of the Petitioner and the investment made by the Petitioner have also been put at risk in the present matter, and therefore, directions have to be issued to the KIADB to cooperate with the Petitioner in the implementation of its project.

16.9. There is an arbitrary cancellation of the allotment of the Petitioner by the KIADB and an illegal allotment made to Respondent No.3. Initially, KIADB having informed Respondent No.3 that there is no land available, ought not to have allotted the land of the Petitioner to Respondent No.3. He relies on the documents produced by filing an application under the Right to Information Act to contend - 18 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR that there is an admission made by the KIADB of issues relating to the said land which is being looked into personally by the CEO and Executive Member, KIADB as per the Principal Secretary's email dated 09.08.2012. The Principal Secretary,

08.01.2014, has written to Respondent No.3- MAGTEL that he has spoken to the CEO and even KIADB and is working on the request. MAGTEL wrote to the KIADB on 29.04.2015 stating that there are vacant plots in Bidadi Industrial Area Phase II, like Plot Nos . 34, 35 and 36, and requested the allotment of one of the plots.

16.10. As on 29.04.2015, when the said email was written, the allotment of the Petitioner had not been cancelled. Thus, the question of MAGTEL contending that there are vacant plots which could be allotted was completely misconceived. - 19 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR Immediately thereafter, Petitioner's allotment was cancelled on 06.07.2015, and a portion of the plot was allotted to Respondent No.3-MAGTEL, and in this regard, he relies on the note sheet dated 08.07.2015.

16.11. Petitioner vide his letter dated 10.07.2015 had objected to the cancellation of the allotment the Petitioner, which was not considered by the KIADB. There is an obligation on the part of the KIADB to consider the same in terms of Clause 9 of the allotment letter the Petitioner, which casts an obligation on the part of the KIADB to restore allotment if a request is made within 30 days. Thus, he submits that the allotment made to MAGTEL was in undue haste and contravention of law and facts.

16.12. His further submission is that KIADB has arbitrarily and illegally cancelled the Petitioner's - 20 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR allotment to unduly favour Respondents No.4 and 5, namely, Parvati Enterprises (hereinafter referred to as ‘Parvati’), and Rajarajeshwari Engineering Works (hereinafter referred to as ‘Rajarajeshwari’) respectively. His contention is that Parvati and Rajarajeshwari claim to be land losers. In this regard, he refers to the note sheet dated 19.08.2013, submitted by Sri. Puttavirayya, the owner of Sy. No. 95 of Shunya Mangala Village, had taken compensation for the lands of 5 acres 10 guntas out of 7 acres 10 guntas acquired, the land owner and his son troubling the entrepreneurs of Plot Nos.33, 37B, 37A, 36A, 36, 34 and 35.

16.13. The allottee of Plot No.33 had approached the Court. It was on that basis that it was decided by the Board in its 308th meeting held on

25.07.2011 to consider the request of the landlords for allotment on priority basis and if - 21 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR the land is not available, as and when vacant is available by way of cancellation, resumption or surrendering, the same to be allotted on priority basis to the land losers. Thus, he submits that the KIADB has sought to favour the land losers by allotting the land on account of their having created problems for the allottees by cancelling the allotment made to the Petitioner on 06.07.2015.

16.14. This allotment made to Respondents No.4 and 5, is even prior to the cancellation of the Petitioner's allotment, since the same has been made on 23.01.2015, where the cancellation occurred on 06.07.2015. The allotment made to Respondent No.5 on 27.05.2015 was also made prior to the cancellation of the allotment of the Petitioner on 06.07.2015. He, therefore, submits that the writ petition is required to be allowed. - 22 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

#17. Sri. P.V. Chandrasekhar, learned counsel appearing for the KIADB, would submit that;

17.1. The writ petition is liable to be rejected on account of delay and laches. The cancellation order was passed on 06.07.2015, and the Writ Petition was filed on 25.04.2016, nearly a year the cancellation. MAGTEL has been allotted the plot on 16.07.2015, possession handed over on 28.08.2015 and lease-cum-sale agreement executed on 21.09.2015; third-party rights have been created, and the Petitioner cannot agitate his rights thereafter.

17.2. He submits that the Petitioner has only paid 20% of the cost of the land from the year 2010, balance 80%, amounting to Rs. 03,74,40,000/ was not paid, despite several extensions of time being granted by the KIADB. The allotment having been cancelled on - 23 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

06.07.2015, the Petitioner had requested some more time to pay the amount and requested the cancellation order be recalled. Considering the said request, the Petitioner was issued a fresh allotment for 3.75 acres at a cost of Rs.01,98,90,000/- and an extension of 15 days’ time was granted to make payment of the balance amount together with interest at

12.75%. This amount was also not remitted by the Petitioner and hence, the second allotment made was also cancelled on 11.12.2015.

17.3. Thus, he submits that whether the loan was sanctioned or not is immaterial so long as the Petitioner did not make payment of the amounts. It is for the Petitioner to take up the same with the banker, and not hold the KIADB responsible for it.

17.4. Insofar as the allegation that no amenities are provided, he submits that the same is a false - 24 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR statement. All the amenities have been provided, the area has been developed, and roads have been laid. The respondent No.3- MAGTEL, on allotment, has put up construction, which indicates that the roads are available. The Petitioner's contention regarding the non- development of the industrial area is a self- serving statement that is not based on any logical basis.

17.5. The Petitioner has not availed of the many opportunities provided by KIADB in extending the time to make payment of the monies. One M/s.Ambience Refrigeration Private Limited, which had been allotted Plot No. 33, took possession on 17.11.2011, and a lease-cum- sale agreement was executed on 12.01.2012, in furtherance of which a plan sanction was obtained and the construction of the factory was completed. - 25 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

17.6. His further contention that another neighbouring allottee M/s.Manyata Impex Private Limited, which had been allotted Plot No.37-B, has also put up construction of the factory. The neighbours having put up construction, the claim of the Petitioner that there is no access to the property, or that the is not developed, completely misconceived. His contention is that KIADB has complied with all the terms and conditions. It is the Petitioner who has not complied with its obligations; the payments due by the Petitioner have not been made. Even though the extent was reduced, the payments towards reduced extent were also not made. The Petitioner, having accepted the modified allotment letter, cannot implementation and or enforcement of the earlier allotment. - 26 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

17.7. He submits that the plots in question are carved out of land bearing Sy.Nos.95 and 213 of Shunyamangala Village, Bidadi Hobli, Ramnagara Taluk. Final notification having been issued on 19.11.2007 under subsection (4) of Section 28 of the KIADB Act, the land stood vested with the State Government free of all encumbrances. The said lands were handed over by the Special Land Acquisition Officer (hereinafter for brevity referred to as “SLAO”) to KIADB on 12.01.2009, and thereafter, it is the KIADB who is in possession of the property. Insofar as land in Sy.No.95 is concerned, the landowner Sri. Eeramadaiah has been paid compensation for 6 acres 30 guntas of land. The land in Sy.No.213 is owned by Sri. Ramaiah, Sri. Ramaswamy, Sri. Kenchaiah Sri. Doddaputtaiah who have also been paid compensation, which are detailed as under: - 27 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

#3. It is submitted that, the land owner of Sy.No.95 of Shanumangala Sri. Eeramadaih has been paid compensation for 06 Acres 30 Guntas, as follows: i) On 21.02.2011 a sum of Rs. 2,10,00,000 (Two Crores Ten Lakhs Only) for an extent of 5 Acres 10 Guntas. ii) On 21.06.2011 a sum of Rs. 6,10,475 (Rupees Six Lakhs Ten Thousand Four Hundred and Seventy Five Only) towards Malkies. iii) On 10.01.2012 a sum of Rs.39,82,792 (Rupees Thirty Nine Lakhs Eighty Two Thousand Seven Hundred Ninety Two only) iv) On 28.09.2013 a sum of Rs.6,00,000/- (Rupees Six Lakhs Only), of an extent of 01 Acre 20 Guntas and he sought for allotment of balance extent of land i.e., Plot No. 34-P1.

#4. It is submitted that the land owners of Survey number 213 are Sriyuths Ramaiah, Ramaswamy, Kenchaiah and Doddupattaiah have paid the compensation of their respective exents in the following manner: i) On 08.04.2010 a sum of Rs.95,75,000/- (Rupees Ninety Five Lakhs Seventy Five Thousand Only) to Sri. Ramaiah for lands in Survey number 145, 147/2 and 213. ii) On 26.02.2012 a sum of Rs.1,64,433 (Rupees One Lakh Sixty Four Thousand Four Hundred and Thirty Three) to Sri. Ramaiah for lands in Survey numbers 147 and 213 (Towards Malkies). iii) On 03.01.2012 a sum of Rs.62,374 (Rupees Sixty Thousand Three Hundred and Seventy Four Only) to Sri. Ramaswamy for lands in Survey numbers 145 and 213 (Towards Malkies). - 28 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR iv) On 27.08.2012 a sum of Rs.33,110 (Rupees Thirty Thousand One Hundred and Ten) to Sri. Ramaswamy for lands in Survey number 145 and 213. v) On 14.09.2010 a sum of Rs.1,14,059 (Rupees One Lakh Fourteen Thousand and Fifty Nine) to Sri. Ramaswamy for lands in Sy.No.145 and 213. vi) On 08.04.2010 a sum of Rs.95,75,000 (Rupees Ninety Five Lakhs Seventy Five Thousand) to Sri. Kenchaiah for lands in Survey numbers 145, 147/2 and 213. vii) On 21.12.2010 a sum of Rs.62,961 (Rupees Sixty Two Thousand Nine Hundred and Sixty One) to Sri. Kenchaiah for lands in Survey Numbers 147/2 and 213. viii) On 29.12.2010 a sum of Rs. 1,07,821 (Rupees One Lakh Seven Thousand Eight Hundred Twenty One) to Sri. Kenchaiah for lands in Survey numbers 145, 147/2 and 213. ix) On 25.06.2010 a sum of Rs.1,91,50,000 (Rupees One Crore Ninety One Lakhs Fifty (Rs. Thousand) 63,83,344), Kencharamaiah (Rs. 63,83,343) and Ramaswamy (Rs. 63,83,333) for lands in Survey numbers 145, 147/2 and 213. to Sriyuths Doddaputtaiah

17.8. It is after the completion and formation of the industrial plots that an allotment letter was issued by the KIADB to the Petitioner. He again reiterates that the entire payment has not been made. The other neighbouring plot owners have put up construction and are operating the - 29 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR industries. It is only the Petitioner who has not done so. The Petitioner cannot claim any benefit in relation thereto.

17.9. The Petition not making out any grounds is required to be dismissed.

#18. Sri. Udaya Holla, learned senior counsel appearing for MAGTEL submits that:

18.1. The petition is required to be dismissed on account of delay and laches.

18.2. The Petitioner had suppressed the fact that the original allotment of 6 acres was modified on

31.07.2013 to 3.75 acres. This suppression goes to the root of the matter inasmuch as having accepted the modification and reduction, the Petitioner has chosen to agitate his rights over the entire land, which is not permissible. - 30 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR

18.3. In this regard, he relies upon the decision of the Hon’ble Apex Court in the case of ABCD v. Union of India3, more particularly para no. 17 thereof, which is reproduced hereunder for easy reference:

#17. In K.D. Sharma v. SAIL [K.D. Sharma v. SAIL, (2008) 12 SCC 481] it was observed: (SCC p. 493, para 39) If the primary object as highlighted “39. Kensington Income Tax Commrs. [R. v. General Commissioners for Purposes of Income Tax Acts For District of Kensington, ex p Princess Edmond De Polignac, (1917) 1 KB 486 : 86 LJKB 257 : 116 LT 136 (CA)] is kept in mind, an applicant who does not come with candid facts and “clean breast” cannot hold a writ of the court with “soiled hands”. Suppression or concealment of material facts is not an advocacy. It is jugglery, manipulation, manoeuvring a misrepresentation, which has no place in equitable and prerogative jurisdiction. If the applicant does not disclose all the material facts fairly and truly but states them in a distorted manner and misleads the court, the court has inherent power in order to protect itself and to prevent an abuse of its process to discharge the rule nisi and refuse to proceed further with the examination of the case on merits. If the court does not reject the petition on that ground, the court would be failing in its duty. In fact, such an applicant requires to be dealt with for contempt of court for abusing the process of the court.”

18.4. By relying on ABCD v. Union of India, he submits that a person who approaches the 3 (2020) 2 SCC 52 - 31 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR Court must disclose all material facts, even if they are against him. He cannot pick and choose the facts he likes to disclose. Having suppressed the above relevant fact, the petition is required to be dismissed.

18.5. He relies on the decision of the Hon’ble Apex Court in the case of K.D. Sharma v. Steel Authority of India Limited and others 4, more particularly para nos. 38 and 39 thereof which are reproduced hereunder for easy reference:

#38. The above principles have been accepted in our legal system also. As per settled law, the party who invokes the extraordinary jurisdiction of this Court under Article 32 or of a High Court under Article 226 of the Constitution is supposed to be truthful, frank and open. He must disclose all material facts without any reservation even if they are against him. He cannot be allowed to play “hide and seek” or to “pick and choose” the facts he likes to disclose and to suppress (keep back) or not to disclose (conceal) other facts. The very basis of the writ jurisdiction rests in disclosure of true and complete (correct) facts. If material facts are suppressed or distorted, the very functioning of writ courts and exercise would become impossible. The petitioner must disclose all the facts having a bearing on the relief sought without any qualification. This is because “the court knows law but not facts”. 4 (2008) 12 SCC 481 - 32 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR the court with

#39. If the primary object as highlighted in Kensington Income Tax Commrs. [(1917) 1 KB 486 : 86 LJKB 257 : 116 LT 136 (CA)] is kept in mind, an applicant who does not come with candid facts and “clean breast” cannot hold a writ “soiled hands”. Suppression or concealment of material facts is not an advocacy. It is a jugglery, manipulation, manoeuvring or misrepresentation, which has no place in equitable and prerogative jurisdiction. If the applicant does not disclose all the material facts fairly and truly but states them in a distorted manner and misleads the court, the court has inherent power in order to protect itself and to prevent an abuse of its process to discharge the rule nisi and refuse to proceed further with the examination of the case on merits. If the court does not reject the petition on that ground, the court would be failing in its duty. In fact, such an applicant requires to be dealt with for contempt of court for abusing the process of the court.

18.6. By relying on K.D. Sharma’s case , he again contends that a person approaching the Court must disclose all material facts.

18.7. He submits that the Petitioner has been approbating and reprobating inasmuch as it is contended the area has not been developed. On the other hand, the Petitioner is willing to take the allotment by challenging the allotment made in favour of Respondent No.3. If the stand of the Petitioner is that the area has not been developed, the question of the Petitioner accepting the allotment would not - 33 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR arise. Otherwise, the fact that the Petitioner is willing to take the allotment after the same has been made in favour of Respondent No.3, by not having paid the due amounts for more than 5 years, indicates the mala fides on part of the Petitioner on account of the continuous approbating and reprobating on the allotment. In this regard, he relies upon the judgment of the Hon’ble Apex Court in the case of Cauvery Coffee Traders, Mangalore vs. Hornor Resources (International) Co. Ltd.,5 more particularly para nos. 34 and 35 thereof, which are reproduced hereunder for easy reference:

#34. A party cannot be permitted to “blow hot and cold”, “fast and loose” or “approbate and reprobate”. Where one knowingly accepts the benefits of a contract or conveyance or an order, is estopped to deny the validity or binding effect on him of such contract or conveyance or order. This rule is applied to do equity, however, it must not be applied in a manner as to violate the principles of right and good conscience. (Vide Nagubai Ammal v. B. Shama Rao [AIR 1956 SC 593] , CIT v. V.MR.P. Firm Muar [AIR 1965 SC 1216] , Maharashtra SRTC v. Balwant Regular Motor Service [AIR 1969 SC 329] , P.R. Deshpande v. Maruti Balaram Haibatti [(1998) 6 SCC 5 (2011) 10 SCC 420 - 34 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR 507 : AIR 1998 SC 2979] , Babu Ram v. Indra Pal Singh [(1998) 6 SCC 358 : AIR 1998 SC 3021] , NTPC Ltd. v. Reshmi Constructions, Builders & Contractors [(2004) 2 SCC 663 : AIR 2004 SC 1330] , Ramesh Chandra Sankla v. Vikram Cement [(2008) 14 SCC 58 : (2009) 1 SCC (L&S) 706 : AIR 2009 SC 713] and Pradeep Oil Corpn. v. MCD [(2011) 5 SCC 270 : (2011) 2 SCC (Civ) 712] .)

#35. Thus, it is evident that the doctrine of election is based on the rule of estoppel—the principle that one cannot approbate and reprobate inheres in it. The doctrine of estoppel by election is one of the species of estoppels in pais (or equitable estoppel), which is a rule in equity. By that law, a person may be precluded by his actions or conduct or silence when it is his duty to speak, from asserting a right which he otherwise would have had.

18.8. By relying on Cauvery Coffee Trader’s case, he submits that one cannot approbate and reprobate in a manner similar to blowing hot and cold, when one, with all knowledge and judgement, consents to a contract, he then cannot deny the binding nature of instrument upon him. This rule applies insofar as equitable estoppel is concerned. The Petitioner, having changed his stance multiple times and delayed on payments on multiple occasions, invariably warrants the rule of - 35 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR equitable estoppel to be applied and thus, cannot assert a claim of an existing right to avail allotment.

18.9. He relies upon the judgment of the Hon’ble Apex Court in the case of Rajasthan State Industrial Development & Investment Corporation and another v. Diamond & Gem Development Corporation Limited and another, 6 more particularly, para nos. 15 and 16 thereof, which are reproduced hereunder for easy reference:

#15. A party cannot be permitted to “blow hot-blow cold”, “fast and loose” or “approbate and reprobate”. Where one knowingly accepts the benefits of a contract, or conveyance, or of an order, he is estopped from denying the validity of, or the binding effect of such contract, or conveyance, or order upon himself. This rule is applied to ensure equity, however, it must not be applied in such a manner so as to violate the principles of what is right and of good conscience. [Vide Nagubai Ammal v. B. Shama Rao [AIR 1956 SC 593] , CIT v. V. MR. P. Firm Muar [AIR 1965 SC 1216] , Ramesh Chandra Sankla v. Vikram Cement [(2008) 14 SCC 58 : (2009) 1 SCC (L&S) 706 : AIR 2009 SC 713] , Pradeep Oil Corpn. v. MCD [(2011) 5 SCC 270 : (2011) 2 SCC (Civ) 712 : AIR 2011 SC 1869] , Cauvery Coffee Traders v. Hornor Resources (International) Co. Ltd. [(2011) 10 SCC 420 : (2012) 3 SCC (Civ) 685] and V. 6 (2013) 5 SCC 470 - 36 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR Chandrasekaran v. Administrative Officer [(2012) 12 SCC 133 : (2013) 2 SCC (Civ) 136 : JT (2012) 9 SC 260] .]

#16. Thus, it is evident that the doctrine of election is based on the rule of estoppel—the principle that one cannot approbate and reprobate is inherent in it. The doctrine of estoppel by election is one among the species of estoppels in pais (or equitable estoppel), which is a rule of equity. By this law, a person may be precluded, by way of his actions, or conduct, or silence when it is his duty to speak, from asserting a right which he would have otherwise had.

18.10. Diamond & Gem’s case too relies upon the same observation made in Cauvery Coffee Traders’ case, clearly establishing the stand and view of the Hon’ble Apex Court as regards the application of the doctrine of equitable estoppel.

18.11. He relies upon the judgment of the Hon’ble Apex Court in the case of State of Uttar Pradesh vs. Karunesh Kumar and others7, more particularly para no. 22 thereof, which is reproduced hereunder for easy reference:

#22. In the case at hand, the un-selected candidates want to press into service a part of the 1978 Rules 7 2022 SCC Online SC 1706 - 37 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR while accepting the 2015 Rules. Such a selective adoption is not permissible under law, as no party can be allowed to approbate or reprobate, as held by this Court in Union of India v. N. Murugesan, (2022) 2 SCC 25: “Approbate and reprobate

#26. These phrases are borrowed from the Scots law. They would only mean that no party can be allowed to accept and reject the same thing, and thus one cannot blow hot and cold. The principle behind the doctrine of election is inbuilt in the concept of approbate and reprobate. Once again, it is a principle of equity coming under the contours of common law. Therefore, he who knows that if he objects to an instrument, he will not get the benefit he wants cannot be allowed to do so while enjoying the fruits. One cannot take advantage of one part while rejecting the rest. A person cannot be allowed to have the benefit of an instrument while questioning the same. Such a party either has to affirm or disaffirm the transaction. This principle has to be applied with more vigour as a common law principle, if such a party actually enjoys the one part fully and on near completion of the said enjoyment, thereafter questions the other part. An element of fair play is inbuilt in this principle. It is also a species of estoppel dealing with the conduct of a party. We have already dealt with the provisions of the Contract Act concerning the conduct of a party, and his presumption of knowledge while confirming an offer through his acceptance unconditionally. xxxxxxxxx

27.2. State of Punjab v. Dhanjit Singh Sandhu [(2014) 15 SCC 144] : (SCC pp. 153-54, paras 22- 23 & 25-26) “22. The doctrine of “approbate and reprobate” is only a species of estoppel, it implies only to the conduct of parties. As in the case of estoppel it cannot operate against the provisions of a statute. (Vide CIT v. MR. P. Firm Muar [AIR 1965 SC 1216].)

#23. It is settled proposition of law that once an order has been passed, it is complied with, accepted by the other party and derived the benefit out of it, he (Vide cannot Maharashtra SRTC v. Balwant Regular Motor Service it on any ground. challenge - 38 - NC: 2025:KHC:23343 WP No. 25081 of 2016 HC-KAR