2003 (12) TMI 588 - SC - Indian Laws

Power of resumption of land/building of the first respondent in favour of the appellants under the Capital of Punjab (Development and Regulation) Act, 1952 read with the Chandigarh Lease Hold of Sites and Buildings Rules, 1973 and the Public Premises (Eviction of Unauthorized Occupants) Act, 1971? Held that - We cannot but deprecate the conduct of the appellants in not making an endeavour to pay the instalments within a reasonable period. They, thus, did not pay the entire amount of the first instalment within the stipulated period; only a part payment was made in the year 1990 and 1992 by that time even the second instalment became due. They did not make any payment before the revisional authority despite the order passed by the appellate authority. We, therefore, are of the opinion that the appellant in C.A. No. 49 of 1999 should deposit a further sum of Rs. 15,00,000/- (Rupees fifteen lacs) with the Estate Officer, Chandigarh within a period of ten weeks from date of receipt of a copy of this order, which, in our opinion would meet the ends of justice. However, so far as the other matters are concerned, having regard to the facts and circumstances obtaining in their cases, we do not intend to direct levy of any penalty on them.

Issues Involved:
1. Power of resumption of land/building
2. Payment of instalments and interest
3. Validity of proceedings and orders by Estate Officer
4. Vires (constitutionality) of the 1952 Act
5. Application of the doctrine of proportionality
6. Equitable considerations and judicial precedents

Issue-wise Detailed Analysis:

1. Power of Resumption of Land/Building:
The central issue in these appeals is the power of the first respondent to resume land/building in favor of the appellants under the Capital of Punjab (Development and Regulation) Act, 1952, read with the Chandigarh Lease Hold of Sites and Buildings Rules, 1973, and the Public Premises (Eviction of Unauthorized Occupants) Act, 1971. The Estate Officer had the authority to resume the lease and forfeit the amount paid if the appellant failed to make timely payments. The power of resumption was exercised after the appellant defaulted on the payment of instalments.

2. Payment of Instalments and Interest:
The appellant purchased the site on a lease-hold basis and was required to pay the purchase amount in instalments, with interest applicable on delayed payments. Despite constructing a six-storied building, the appellant failed to pay the second instalment due in 1989. The Estate Officer issued notices and eventually canceled the lease due to non-payment. The appellant contended that the area was underdeveloped, which hindered the leasing of the building. Payments were made sporadically, and the appellant claimed that the interest charged was excessive and not in accordance with the agreed terms.

3. Validity of Proceedings and Orders by Estate Officer:
The Estate Officer's order of resumption and forfeiture was challenged on the grounds of procedural irregularities. The appellant argued that the Estate Officer did not consider the payments made and failed to provide a fair hearing. The appellate and revisional authorities provided opportunities for the appellant to clear the dues, but the appellant failed to comply fully. The High Court dismissed the writ petition filed by the appellant, leading to the present appeals.

4. Vires (Constitutionality) of the 1952 Act:
The constitutionality of Section 8-A of the 1952 Act, which empowers the Estate Officer to resume land/building and forfeit money, was upheld by the Punjab and Haryana High Court in Ram Puri v. Chief Commissioner, Chandigarh. The provision was challenged as being violative of Article 14 of the Constitution of India. The majority held that the power of resumption is valid but should be used as a last resort. This principle was affirmed by the Supreme Court in Babu Singh Bains and Ors. v. Union of India and Ors.

5. Application of the Doctrine of Proportionality:
The doctrine of proportionality was invoked to assess whether the extreme power of resumption and forfeiture was appropriately applied. The Court emphasized that the power of resumption should be a last resort and must be exercised with caution. The principle of proportionality requires that the least restrictive measures be adopted to achieve the legislative or administrative purpose. The Court examined whether the respondents maintained a proper balance between the adverse effects on the appellant's rights and the purpose of the administrative action.

6. Equitable Considerations and Judicial Precedents:
The Court considered various precedents where relief was granted to parties who had defaulted on payments but later showed bona fide efforts to clear dues. Cases like Jasbir Kaur v. U.T. Chandigarh and Surinder Kaur v. Government of Punjab were cited to illustrate that a humane approach is necessary. The Court noted that while sympathy alone cannot justify an order, equitable considerations play a significant role in judicial decisions. The Court also referred to the principle that public authorities must act in public interest and that their actions are subject to judicial scrutiny.

Conclusion:
The Supreme Court concluded that while the appellants had defaulted on payments, they had shown bona fide efforts to clear the dues. The Court directed the appellant in Civil Appeal No. 49 of 1999 to deposit an additional sum of Rs. 15,00,000/- with the Estate Officer, Chandigarh, within ten weeks. The appeals were disposed of with no costs, emphasizing that the statutory right of resumption should not be exercised arbitrarily and must be balanced with equitable considerations.

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