2024 (12) TMI 595 - SC - Indian Laws

Appeal against High Court order quashing resumption of plot and restoring it to allottee - allottees had failed to make payment of the remaining 75% of the premium amount as per the terms and conditions of the auction sale - lease of the auction site was cancelled by the Assistant Estate Office - HELD THAT - Under the circumstances, despite sufficient opportunities of hearing given to the allottees to clear the outstanding dues, the respondents allottees had failed to clear the same. Hence, the High Court had committed gross error in allowing the writ petitions by holding that the tenant, i.e., M/s. Mohit Medicos was not served with the notice of resumption with regard to the plot in question. Admittedly, there was no document whatsoever produced by the said alleged tenant to show that it was the tenant of the original allottees - Manjit Kumar Gulati and Ors. When the original allottees themselves had failed to comply with the conditions of auction sale, and when the allotment itself made in favour of the said allottees was cancelled by the Statutory Authority after following the due process of law, i.e., by issuing show cause notice before cancellation of allotment, and when number of opportunities of hearing were given to the allottees to clear the outstanding dues, there was no question of serving any notice to the so called tenant, M/s. Mohit Medicos, especially when there was nothing on record to suggest that M/s. Mohit Medicos was the tenant of the original allottees - Manjit Kumar Gulati and Ors. The High Court had completely lost sight of the said factual aspects of the matter while allowing the writ petitions filed by the respondents allottees and the so called tenant M/s. Mohit Medicos. The High Court had completely lost sight of the said factual aspects of the matter while allowing the writ petitions filed by the respondents allottees and the so called tenant M/s. Mohit Medicos. The decision of FULL Bench of Punjab and Haryana High Court relied upon by the learned senior counsel for the respondent(s) - tenant has no application to the facts of the present case, inasmuch as the respondent(s) M/s. Mohit Medicos, by no stretch of imagination could be said to be a tenant of the original allottees, in absence of any material placed on record, to substantiate the same. The litigation carried forward by the said alleged tenant is nothing but a proxy litigation on behalf of the original allottees, who were the defaulters and an abuse of process of law. The impugned order passed by the High Court being erroneous is set aside - Appeal allowed.

Summary

Issues:
Appeal against High Court order quashing resumption of plot and restoring it to allottee, failure of allottees to pay outstanding amount, challenge to cancellation of lease, locus standi of alleged tenant to file writ petition.

Analysis:
The Supreme Court heard appeals arising from a High Court order quashing the resumption of a plot and restoring it to the allottee. The appellants had sold a booth site on leasehold basis but the allottees failed to pay the balance amount, leading to cancellation of the lease. The Chief Administrator directed the allottees to pay the outstanding amount within 15 days, which they failed to do. The High Court allowed writ petitions filed by the allottees and an alleged tenant, challenging the cancellation of lease. The appellants argued that the High Court should not have interfered with the orders of statutory authorities. The alleged tenant claimed locus standi based on a High Court decision. However, the Court found that the allottees had multiple opportunities to clear dues but failed to do so, leading to cancellation of the lease. The alleged tenant's claim of being a lessee was unsubstantiated, and the High Court erred in allowing the writ petitions. The Court held the High Court order as erroneous and allowed the appeals.

This case involved the cancellation of a lease due to non-payment by the allottees, subsequent legal challenges, and the alleged tenant's claim of locus standi. The Court emphasized that the allottees had ample opportunities to clear dues but failed to do so, leading to cancellation of the lease. The alleged tenant's claim of being a lessee was not supported by evidence, and the High Court's decision to allow the writ petitions was deemed erroneous. The Court set aside the High Court order and allowed the appeals, emphasizing the importance of fulfilling contractual obligations in lease agreements.

The Court highlighted the sequence of events leading to the cancellation of the lease, including show cause notices, appeals, and the allottees' failure to comply with payment deadlines. The Chief Administrator's order directing payment within 15 days was not adhered to by the allottees, leading to the cancellation of the lease. The alleged tenant's challenge was also dismissed due to lack of evidence supporting their claim of being a lessee. The Court criticized the High Court for allowing the writ petitions without considering the allottees' default in payment and the lack of evidence regarding the alleged tenant's status, deeming it a misuse of legal process.