2024 (3) TMI 1278 - HC - Indian Laws

Cancellation of allotment of land on the basis of an alleged false affidavit - whether the petitioner had submitted a bona fide and genuine affidavit at the time of submission of his application seeking allotment of alternate plot of land in lieu of the compulsory land acquisition of his property? - HELD THAT - The Allahabad High Court in IN RE RAM KUMAR RAMNIWAS OF NANPARA 1952 (8) TMI 32 - HIGH COURT OF ALLAHABAD had held that the HUF is not like a corporation or a limited concern and it cannot, therefore, be said that it had a legal entity quite distinct and separate from that of those who constituted it. It further observed that HUF is a status which can only be acquired by birth or adoption and the head or karta of that family has certain rights by which he can bind every member of the family though, the property may not belong to him and belongs to all. In another words, it appears to this Court that though the HUF may be a legal entity for the purposes of Income Tax and may hold a property in its own name, yet it cannot be said that the individual members constituting it, do not have any share in the said property. The share in such property on devolution may change or vary in proportions with the increase or decrease in the members constituting the HUF. This surely cannot mean that the individual members do not have any rights whatsoever over the HUF property. It is clear that the HUF under the Income Tax Act, 1961 is a juridical person. However, the right or entitlement of the individual members constituting such HUF in respect of any property owned by it, has also been accepted. The role of karta in respect of such property is also clearly delineated - All the analysis leads this Court to the firm conclusion that the property belonging to the HUF also belongs to each of the individual constituents in the proportionate share. In another words, every member of the HUF has some share in the said property. Thus, it is clear that though the Defence Colony Property was placed in the common hotchpotch of the HUF in the year 1962, yet the shares of the petitioner as also his wife and two minor children, as they then were, in the said property cannot be undisputed. As to what were the proportion of shares, is irrelevant to consider in the present dispute - this Court needs to examine as to whether the petitioner can now be said to have violated the eligibility conditions at the time of filing the affidavit in support of the application for allotment of alternate plot of land. As on that date, not only the petitioner but also the family members, who individually constituted the HUF had a proportionate share in the Defence Colony Property. This fact was not disclosed. In the considered view of this Court, this was a concealment of material fact, which would have otherwise disentitled the petitioner from allotment of alternate plot of land as per the 1961 Scheme - The argument that the petitioner had thrown the self-acquired Defence Colony Property in the common hotchpotch of the HUF in the year 1962 even before the compulsory acquisition of his lands in the year 1964, and as such, had not committed any concealment is concerned, the same is recorded only to be rejected. The said rejection is on the basis of the aforesaid reasons in the preceding paragraphs, holding that each of the individual members of the HUF had proportionate share in such property. The sanctity of the declaration and solemn affirmation was to be maintained at all times. In case an applicant furnished a false declaration or concealed material facts, it would be direct violation/contravention of mandatory condition of allotment. Since the petitioner had not disclosed the existence of a HUF property of which the petitioner himself was the karta and his wife and two minor children were the remaining members, in the considered opinion of this Court, that sanctity was broken. Though the Defence Colony property was claimed to have been thrown in the common hotchpotch of the HUF in the year 1962, there was no reason furnished by the petitioner as to why the mutation of the said property in the name of HUF was not applied for till the month of January, 1979 which was finally carried out by the authority on 26.10.1979. Admittedly, the said property was leased out on rent indicating that the petitioner was not in dire need of an alternate plot of land. There is no doubt that there was a delay however, keeping in view the ratio down by the Supreme Court in SP CHENGALVARAYA NAIDU VERSUS JAGANNATH 1993 (10) TMI 315 - SUPREME COURT , whereby it was categorically laid down that fraud vitiates all solemn acts . On the strength of this, this Court is of the considered opinion that the petitioner had obtained the allotment of an alternate plot by concealment of material facts amounting to fraud and as such cannot be heard to say that the respondents have delayed adjudication of the show cause notice. In that view of the matter, the said argument has no substance. There is no merit in the writ petition and the same is dismissed.

Summary

Issues Involved:
1. Legality of the cancellation of lease due to alleged false affidavit.
2. Applicability of the 1961 Scheme and Nazul Rules, 1981.
3. Entitlement to an alternate plot under the 1961 Scheme.
4. Delay in issuing the show cause notice and cancellation of allotment.

Summary:

1. Legality of the Cancellation of Lease Due to Alleged False Affidavit:
The petitioner sought quashing of the cancellation of the lease for plot No. 11, Block B, Malviya Nagar Extension Residential Scheme, New Delhi, alleging that the cancellation was based on a false affidavit. The petitioner claimed that the Defence Colony property was thrown into the HUF in 1962, and thus, he did not individually own any property. The court held that the affidavit filed by the petitioner concealed material facts about the Defence Colony property, which was owned by the HUF, comprising the petitioner, his wife, and minor children. The court emphasized that every member of the HUF has some share in the HUF property, and thus, the petitioner violated the eligibility conditions of the 1961 Scheme.

2. Applicability of the 1961 Scheme and Nazul Rules, 1981:
The petitioner argued that the Nazul Rules, 1981, should apply as they were in force when the show cause notice was issued in 1982. However, the court rejected this argument, stating that the allotment was made under the 1961 Scheme, and the conditions stipulated therein, including the requirement to not own any residential plot or house, were binding. The court noted that the Nazul Rules impliedly repealed the 1961 Scheme, but in this case, the allotment was under the 1961 Scheme, making the argument about the Nazul Rules irrelevant.

3. Entitlement to an Alternate Plot Under the 1961 Scheme:
The petitioner claimed entitlement to an alternate plot under the 1961 Scheme, arguing that the Defence Colony property was an HUF property and not individually owned. The court held that the HUF property is collectively owned by its members, and the petitioner, as the karta, had a share in the property. Thus, the petitioner was not entitled to an alternate plot under the 1961 Scheme due to the concealment of material facts in the affidavit.

4. Delay in Issuing the Show Cause Notice and Cancellation of Allotment:
The petitioner contended that the delay in issuing the show cause notice in 1982 and the cancellation in 2003 was unjustified. The court found the explanation provided by the respondent satisfactory, noting that the delay was due to the time taken to collate requisite information. The court referred to the Supreme Court's ruling that "fraud vitiates all solemn acts" and held that the petitioner's concealment of material facts amounted to fraud, making the delay argument unsubstantial.

Conclusion:
The court dismissed the writ petition, upholding the cancellation of the lease and rejecting the petitioner's claims. The petitioner was found to have violated the eligibility conditions of the 1961 Scheme by concealing material facts about the Defence Colony property, which was an HUF property.