1995 (5) TMI 283 - HC - Companies Law

Summary

Issues Involved:
1. Whether the suit property was in commercial use since before 1962.
2. Whether the suit property or any part thereof is an unauthorized construction.
3. Whether it was necessary to have served any of the plaintiffs in the two suits with notice under Section 343/344 of the DMC Act.
4. Whether the notice under Section 343/344 of DMC Act is invalid for not having been issued by the Commissioner.
5. Whether the plaintiffs have locus standi in filing the suits.
6. Whether provisions of Master Plan-2000 challenged by the plaintiffs are unconstitutional and hit by Article 14 of the Constitution.
7. Whether the plaintiffs are guilty of having made material concealment of facts and whether such conduct disentitles them from the discretionary relief of injunction.
8. Whether the power to demolish conferred by Sections 343 DMC Act is discretionary and whether the impugned action of demolition without exercising discretion is arbitrary.
9. Whether the building in suit is being treated by authorities with hostile discrimination.
10. Whether the plaintiffs can take protection behind the doctrine of Promissory Estoppel and Legitimate Expectations.

Detailed Analysis:

1. Commercial Use Since Before 1962:
The court found that the inspection report dated 29.1.1962, which the plaintiff bank heavily relied upon, was false, fabricated, and planted. The affidavits from MCD officials and the original records demonstrated that the suit property was not in commercial use in 1962. The property was a vacant plot until 1965, and it was not plausible that it had been developed and subjected to commercial use within a short period without any sanction.

2. Unauthorized Construction:
The court noted significant deviations from the sanctioned building plans. The permissible construction limits were exceeded on all floors, and an unauthorized staircase was constructed. The basement, which should not be used for commercial purposes, was being used as such, making the building non-compliant with the Building Bye-Laws.

3. Entitlement to Notice Under Sections 343/344 of DMC Act:
The court held that tenants or persons other than the owner are not entitled to notice under Sections 343/344 of the DMC Act. The right to notice is limited to the person at whose instance the unauthorized construction was commenced, carried on, or completed. However, tenants and builders, though not entitled to notice, can appeal as 'persons aggrieved' by the order of demolition.

4. Validity of Notice Issued by Commissioner:
The court found that the notices issued by the Zonal Engineer (Buildings) were valid as the Commissioner had delegated his powers under Section 491 of the DMC Act. The objection that the notices were not issued by the Commissioner himself was dismissed.

5. Locus Standi and Maintainability of Civil Suits:
The court referred to the Supreme Court's ruling in Shiv Kumar Chadha vs. MCD, which restricts the maintainability of civil suits in cases of demolition under Section 343 of the DMC Act. The plaintiffs, being a tenant and a builder, had the remedy of appeal available to them and should have pursued it. The suits were not maintainable as there was no jurisdictional error on the part of the Corporation.

6. Constitutionality of Master Plan-2000:
The court upheld the validity of the Master Plan-2000, stating that it was based on expert opinion and research aimed at the planned development of Delhi. The distinction between plots allowing 2-1/2 floors and those allowing 3-1/2 floors was based on intelligible classification with a nexus to the object sought to be achieved. The challenge under Article 14 of the Constitution was found to be without merit.

7. Material Concealment of Facts:
The court found that the plaintiff in suit No. 2581/94 had concealed material facts, including the pendency of an appeal by the owner and the completion certificate indicating the building was residential. The plaintiff also submitted a false inspection report. Such conduct disentitled the plaintiff from the relief of temporary injunction.

8. Discretionary Power to Demolish:
The court noted that the power to demolish under Section 343 of the DMC Act is not discretionary in cases of non-compoundable deviations. The municipal authorities are mandated to take action against unauthorized constructions to protect public safety and convenience.

9. Hostile Discrimination:
The court dismissed the claim of hostile discrimination, stating that equality before the law does not mean equality in the violation of law. The plaintiff could not claim discrimination merely because other violators were not proceeded against.

10. Promissory Estoppel and Legitimate Expectations:
The court rejected the plea of promissory estoppel and legitimate expectations based on the election manifesto of a political party. Such promises are not binding on the State and cannot override statutory provisions.

Conclusion:
The court rejected the prayers for ad interim injunction in both suits and vacated the interim order dated 19.11.94 in suit No. 2581/94. The plaintiffs were advised to seek remedies through the appellate tribunal as provided under the DMC Act. The court also suggested measures for handling similar cases in the future to prevent misuse of judicial processes by unscrupulous builders.