# M/S Supertech Precast Tech. Pvt. Ltd v. State of U.P. & Anr

- **Citation:** (2022) 4 ILRA 855
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2022-04-19
- **Case number:** Writ-C No. 26666 of 2021
- **Bench:** Dinesh Kumar Singh
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-supertech-precast-tech-pvt-ltd-v-state-of-u-p-anr-48357
- **Pages:** 11

## Headnote

Industrial Law - U.P. Industrial Area
Development Act, 1976 -Section 12 -
Urban Planning Development Act, 1973 -
Section 41(3) - Allotment of land -
Authority demanded land premium and
lease rent as petitioner did not pay any
amount except payment of 10% allotment
money - petitioner's case that it was not
provided water connection for production
of precast by the Authority - Held -
petitioner will deposit Rs. 1 Crore with the
Authority and make the payment for
laying down the pipeline from STP to its
unit for making supply of STP water for its
industrial unit at the applicable rate -
Authority should lay down the pipeline
after receiving the cost and provide the
water to the industrial unit so that its cost
of manufacturing of concrete precast gets
reduced and industrial unit becomes
viable (Para 33)

B. Industrial Law - U.P. Industrial Area
Development Act, 1976- Section 12 -
Allotment of land - 90% of the premium
was to be paid with interest @ 12% per
annum - in case of default of payment,
penal interest @ 14% was to be charged -
default in payment - petitioner requested
for rescheduling and restructuring the
land dues and also payment of interest as
per bank rate - Held - interest @ 12% per
annum on premium compounding penal
interest @ 14% would make an industry
unviable - It could not be the purpose of
Authority to allow industries to be set up
and then make same unviable - Such a
high rate of penal interest besides the
interest @ 12% per annum on premium is
enough to bleed the industry and make it
unviable - matter is remitted back to the
Revisional Authority i.e. State Government
to reduce penal interest to 6% per annum
instead of 14% per annum on default of
payment of premium and allow the
petitioner to pay the premium along with
interest (12% + 6%, total 18% per
annum simple interest) in installments,
may be spread over to 5- 7 years (Para
33)

Allowed. (E-5)

List of Cases cited :

## Text

4 All. M/S Supertech Precast Tech. Pvt. Ltd. Vs. State of U.P. & Anr.
855
(2022)04ILR A855
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: LUCKNOW 19.04.2022

BEFORE

THE HON'BLE DINESH KUMAR SINGH, J.

Writ-C No. 26666 of 2021

M/S Supertech Precast Tech. Pvt. Ltd.
 ...Petitioner
Versus
State of U.P. & Anr. ...Respondents

Counsel for the Petitioner:
Abhishek Khare, Saumya

Counsel for the Respondents:
C.S.C., Prashant Kumar

Industrial Law - U.P. Industrial Area
Development Act, 1976 -Section 12 -
Urban Planning Development Act, 1973 -
Section 41(3) - Allotment of land -
Authority demanded land premium and
lease rent as petitioner did not pay any
amount except payment of 10% allotment
money - petitioner's case that it was not
provided water connection for production
of precast by the Authority - Held -
petitioner will deposit Rs. 1 Crore with the
Authority and make the payment for
laying down the pipeline from STP to its
unit for making supply of STP water for its
industrial unit at the applicable rate -
Authority should lay down the pipeline
after receiving the cost and provide the
water to the industrial unit so that its cost
of manufacturing of concrete precast gets
reduced and industrial unit becomes
viable (Para 33)

B. Industrial Law - U.P. Industrial Area
Development Act, 1976- Section 12 -
Allotment of land - 90% of the premium
was to be paid with interest @ 12% per
annum - in case of default of payment,
penal interest @ 14% was to be charged -
default in payment - petitioner requested
for rescheduling and restructuring the
land dues and also payment of interest as
per bank rate - Held - interest @ 12% per
annum on premium compounding penal
interest @ 14% would make an industry
unviable - It could not be the purpose of
Authority to allow industries to be set up
and then make same unviable - Such a
high rate of penal interest besides the
interest @ 12% per annum on premium is
enough to bleed the industry and make it
unviable - matter is remitted back to the
Revisional Authority i.e. State Government
to reduce penal interest to 6% per annum
instead of 14% per annum on default of
payment of premium and allow the
petitioner to pay the premium along with
interest (12% + 6%, total 18% per
annum simple interest) in installments,
may be spread over to 5- 7 years (Para
33)

Allowed. (E-5)

List of Cases cited :

1. Gajraj & ors. Vs St.of U.P. & ors. (2011) ADJ
1 (FB)

2. M/s Gaursons Promoters Pvt. Ltd. Vs St. of
U.P. & ors. Writ-C No.18684 of 2019

3. M/s Shakuntala Educational and Welfare
Society Vs St. of U.P. & ors. order Writ-C
No.28968 of 2018 dated 28.05.2020

4. Bikram Chatterji & ors. Vs U.O.I. & ors. Writ
Petition (C) No.940 of 2017

5. MC Mehta Vs U.O.I. Civil Writ Petition
No.4677 of 1985

6. Savitrai Devi & ors. Vs State (2015) 7 SCC 21

(Delivered by Hon'ble Dinesh Kumar
Singh, J.)

1. Petitioner, a Company incorporated
under the provisions of the Companies Act,
1956 (for short "the Act, 1956"), has filed
the present petition, impugning the order
dated 25.11.2020 passed by the Additional
856 INDIAN LAW REPORTS ALLAHABAD SERIES
Chief Secretary, Department of Industrial
Development,
Government
of
Uttar
Pradesh, Lucknow (Revisional Authority)
under Section 41(3) of the Urban Planning
Development Act, 1973 (for short "the Act,
1973") read with Section 12 of the U.P.
Industrial Area Development Act, 1976
(for short "the Act, 1976").

Further prayer has been made for
quashing of Letter of Cancellation dated
06.01.2021 issued by the Greater Noida
Industrial Development Authority (for
short
"GNIDA"),
demanding
Rs.67,78,23,456/- in respect of Plot No. 2,
Sector Ecotech-16, GNIDA, ad-measuring
58271 square meters as per the lease dated
22.06.2011 executed by the GNIDA in
favour of the petitioner in pursuance of the
allotment letter dated 31.03.2011.

A prayer has also been made for
quashing of the letter dated 29.09.2021
issued by the GNIDA, directing the
petitioner to deposit Rs 67,78,23,456/-
within a period of 15 days and get the lease
deed executed, otherwise the GNIDA
would take action for cancellation of the
allotment of plot in favour of the petitioner.

2. The State Legislature had enacted
U.P. Industrial Area Development Act,
1976 (for short "the Act, 1976") to provide
for constitution of an Authority for the
development of certain areas in the State
into industrial and urban township and for
the matters connected therewith. Under
Section 3 of the Act, 1976, the State
Government is empowered to constitute
Industrial Development Authority for the
purposes of the Act, 1976 for any industrial
development area. The GNIDA is an
Authority constituted under the Act, 1976.
Under Article 243-Q of the Constitution of
India, such an authority, constituted under
the Act, 1976 virtually replaces the
municipality in the area so far as the
industrial areas are concerned. All the
functions of a development authority as
well as municipal authority are required to
be discharged by the GNIDA in the
industrial areas for which it has been
constituted.

3. Section 5A of the Act, 1976
provides that the State Government may at
any time, by notification, create one or
more 'Industrial Development Authorities
Centralized Services' for such posts, as the
State Government may deem fit, common
to
all
the
Industrial
Development
Authorities, and may prescribe the manner
and conditions of recruitment to and the
terms and conditions of service of persons
appointed to such service. Functions of the
Authority are prescribed under Section 6 of
the Act, 1976, which provides that the
object of the Authority is to secure the
planned development of the industrial
development areas. The Authority is
empowered to acquire land in the industrial
development area by agreement or through
proceedings under the Land Acquisition
Act, prepare a plan for the industrial
development area, demarcate and develop
sites
for
industrial,
commercial
and
residential purposes according to the plan,
provide
infrastructure
for
industrial,
commercial and residential purposes and to
provide amenities. The Authority is also
empowered to allocate and transfer either
by way of sale or lease or otherwise plots
of land for industrial, commercial and
residential purposes or any other specific
and specified purposes in such area.

4. Amenities have been defined under
Section 2(a) of the Act, 1976, which
includes roads, water supply, street lighting
and power supply, sewerage, drainage,
collection, treatment and disposal of
4 All. M/S Supertech Precast Tech. Pvt. Ltd. Vs. State of U.P. & Anr.
857
industrial waste and town refuse and other
community
facilities
services
or
conveniences as the Government may, by
notification, specify to be an amenity for
the purposes of the Act, 1976.

5. In the year 2011, GNIDA invited
sealed tenders in two-bid systems in the
prescribed application form for allotment of
lease lands in various sectors in Greater
NOIDA for a lease period of ninety years.
The petitioner was successful in bidding
process for Plot No. 2, Sector Ecotech-16.
An allotment letter dated 31.03.2011 was
issued to the petitioner for allotment of the
said plot in its favour. The total area of the
plot was 60000 (Sixty Thousands) square
meters. The rate of land was fixed at
2,687=00 per square meter and total
provisional premium, as per the rate, was
Rs.16,12,20,000=00. 10% (Ten percent) of
the total provisional premium was the
allotment money. The allotment money
was payable by 30.05.2011 along with
registration
money,
which
was
Rs.77,36,185=00. Remaining 90% (Ninety
Percent) amount with interest @ 12% per
annum would be payable in twenty half
yearly installments.1st four half yearly
installments would be for interest payable
on 90% remaining amount @ 12% and
thereafter 16 half yearly installments would
be charged with premium and interest @
12% per annum. It was also provided in the
allotment letter that in case of default of
payment, penal interest @ 14% would be
charged. In the allotment letter, it was also
provided that the allottee would comply all
the terms & conditions pertaining to supply
of water and drainage/sewerage facilities
provided by the authority.

6. Pursuant to the said allotment
letter, leased deed dated 21.06.2011 was
executed between the petitioner and the
GNIDA with respect to the Plot No. 2,
Sector
Ecotech-16,
GNIDA,
Greater
NOIDA, Gautam Budh Nagar for 58271
square meters for the total premium of
Rs.15,65,74,177=00.

7. Out of the said premium, the
petitioner paid 10% i.e. 1,56,57,418=00
and
the
balance
amount
of
Rs.
14,09,16,759=00 became payable in 10
installments along with interest @ 12% per
annum, compounded half yearly. The
petitioner was also required to pay lease
rent of Rs. 4,30,57,899=00 i.e. 27.5% of
the total premium as one time lease rent
payment.

8. The possession letter dated
24.06.2011 was issued to the petitioner
after the petitioner paid 10% of the total
premium i.e. Rs. 1,56,57,418=00-, as
mentioned above. The lay-out plan for the
project was sanctioned on 15.10.2012. The
petitioner
completed
construction
of
manufacturing
unit
and
obtained
completion certificate dated 19.02.2014.

9. It is alleged that the petitioner
could not start its manufacturing activities
of precast due to non-availability of water.
There was no proper road or drainage
system, which made it impossible for the
petitioner to start commercial production of
precast. It is also stated that the petitioner
could not start commercial production of
precast due to agitations of farmers for nonpayment of compensation by the State of
Uttar Pradesh and due to pendency of court
case pertaining to major portion of land
situated in the aforesaid plot. It is also
stated that the petitioner wrote several
letters to the GNIDA, informing them
obstructions created by the villagers and for
maintaining law and order. The petitioner
requested for security and maintenance of
858 INDIAN LAW REPORTS ALLAHABAD SERIES
law
and
order
conducive
for
the
manufacturing and commercial activities of
the petitioner.

10. The Full Bench of this Court in its
judgment in Gajraj and others Vs. State of
U.P. and others (2011) ADJ 1 (FB) though
upheld the land acquisition notification, but
held that invocation of urgency clause was
bad in law. However, instead of quashing
notification
inasmuch
as
widespread
development had taken place on the
acquired land, in order to balance equities,
the High Court directed for payment of
additional compensation of 64.7% to the
tenure holders, whose land was acquired,
and allowed them retention of 10% of
developed land. The GNIDA was directed
to pay the additional compensation to the
farmers and, it was left open to the
discretion of GNIDA to take a decision
upon shifting the proportionate burden of
additional compensation upon the allottees.

11. The petitioner was not provided
water connection for production of precast
by the Authority, nor the petitioner got
permission to dig bore-well to extract
ground water needed for production of
precast. The petitioner did not pay any
amount after payment of 10% allotment
money and, therefore, the Authority vide
demand letter dated 19.08.2016 directed the
petitioner to deposit Rs.17,96,39,097/-
against
the
land
premium
and
Rs.
2,83,51,710/- against lease rent. Another
demand letter was issued on 24.08.2016 for
Rs.17,12,86,068.72/-
against
the
land
premium and for Rs.2,83,51,710/- against
the lease rent.

12. It is further stated that the
petitioner had made several requests to the
GNIDA to provide water connection for
production
of
precast,
however,
the
Authority did not take notice of the request
and another demand letter dated 01.02.2017
was issued, claiming an amount of Rs.
19,23,86,569/- towards land premium and
Rs. 2,92,11,357/- against the lease rent. It is
further stated that the petitioner was forced
to buy STP water from NOIDA and private
STP units for production of precast. The
cost of water being brought from the STP
on tankers was not economically and
commercially viable for the precast unit. It
is further stated that the petitioner sought
no objection certificate form the Authority
for extracting ground water so that the
petitioner could approach the Central
Ground Water Authority for permission to
extract ground water for commercial
production for precast. The Authority had
issued further demand letters, directing the
petitioner to deposit the land premium,
lease rent as well as Rs.5,63,86,898/- for
additional compensation to be paid to the
farmers by the GNIDA in pursuance of the
direction issued by the High Court.

13. The State Government issued
guidelines dated 13.07.2020, allowing
industrial plot owners of more than 2.5
acres of land to sub-lease their land with
certain conditions. Some area was to be
taken back by the by the Authority as buyback scheme.

14. The petitioner vide letter dated
01.09.2020 proposed the Authority to allow
them to sub-lease 4 acres of land out of 15
acres land allotted to them. Out of 4 acres
of land, 2 acres land was to be bought back
by the GNIDA and that sum was to be
immediately deposited/adjusted by the
Authority against the land dues. The
petitioner also requested for remaining dues
to
be
rescheduled
into
6
monthly
installments. The petitioner made requested
for rescheduling and restructuring the land
4 All. M/S Supertech Precast Tech. Pvt. Ltd. Vs. State of U.P. & Anr.
859
dues and also payment of interest as per
bank rate. However, when no action was
taken on any petitioner's representations by
the GNIDA, the petitioner approached the
Revisional Authority under Section 41(3)
of
the
U.P.
Urban
Planning
and
Development Act read with Section 12 of
the Industrial Planning and Development
Act.

15.

The
Revisional
Authority,
however, vide impugned order dated
25.11.2020 held that the petitioner had
started production with effect from August,
2013 and, it has been using recycled water
with effect from 30.06.2015. The petitioner
had made default in making payment of the
premium and other dues and, therefore,
there was no ground to interfere with the
demand notice and cancellation notice
issued by the Authority. It is further stated
that the Authority issued the impugned
demand letter dated 06.01.2021 to which
the petitioner had given detailed reply on
16.01.2021. However, the Authority had
not considered the reply of the petitioner
and issued impugned notice/cancellation
letter dated 29.09.2021 as the petitioner did
not
pay
dues
of
premium
of
Rs.
52,08,24,999/-,
lease
rent
of
Rs.
8,09,26,063 and additional compensation of
Rs. 5,99,97,884/-.

16. Heard Mr. Sri Anil Tewari,
learned Senior Advocate, assisted by Mr.
Abhishek
Khare,
representing
the
petitioner, Mr. Sanjay Mishra, learned
Additional
Chief
Standing
Counsel,
representing respondents-State and Sri
Prashant
Kumar,
learned
counsel
representing respondent no. 2.

17. On behalf of the petitioner,
learned Senior Advocate has submitted that
the main function of GNIDA is to secure
the planned development of industrial
areas, demarcate and develop sites for
industrial purposes. It is the duty of the
GNIDA to provide requisite infrastructure
for
industrial
purposes
and
provide
amenities as defined under the Act, 1976.
Under Article 243-Q of the Constitution of
India, the Authority constituted under the
Act,
1971
virtually
replaces
the
municipality in the area so far as industrial
areas are concerned. All the functions of
development authority as well as municipal
authority are to be discharged by the
GNIDA which include providing water,
drainage and road etc. etc. to the industrial
units. The facts would disclose that the
Authority had failed to provide 'amenities',
making it impossible for the petitioner to
utilize its full potential and become
economically and commercially viable unit.
The Revisional Authority did not take into
consideration the failure of the Authority to
provide
amenities,
including
water
connection, drainage and road etc. and,
without
considering
the
facts
and
circumstances in a proper perspective, in a
mechanical
manner,
has
passed
the
impugned order.

18. On behalf of the petitioner, Mr.
Anil Tewari, learned Senior Advocate has
further submitted that the petitioner has
been charged for water connection, but the
water connection for unit was not given and
the petitioner was forced by the Authority
to bring water by tankers to make the unit
functional. It has also been submitted that
the petitioner is not required to pay the
additional
compensation
in
view
of
judgments of this Court dated 18.09.2019
passed in Writ-C No.18684 of 2019 (M/s
Gaursons Promoters Private Limited Vs.
State of U.P. and others) and dated
28.05.2020 passed in Writ-C No.28968 of
2018 (M/s Shakuntala Educational and
860 INDIAN LAW REPORTS ALLAHABAD SERIES
Welfare Society Vs State of U.P. and
others). It has been further submitted that
rate of interest should be charged on simple
rate, as per SBI MCLR rate and, not on
compounding basis. The learned Senior
Advocate has placed reliance on the order
of the Supreme Court passed in Writ
Petition (C) No.940 of 2017 (Bikram
Chatterji & others Vs. Union of India
and others) and submitted that only simple
rate of interest should be charged by the
Authority.

19. On behalf of the petitioner, Mr.
Anil Tewari, learned Senior Advocate, has
further submitted that the Authority should
be directed to provide water connection.
The petitioner is ready and willing to pay
the amount for laying down pipelines etc.
for providing water connection by the
Authority so that the unit becomes
economically viable. It has been further
submitted that in light of the judgment in
the case of Bikram Chatterji & others Vs.
Union of India and others (supra), the
authority must work out rate of interest and
recalculate the charges.

20. In view of the aforesaid, it has
been submitted that the cancellation notice
as well as the order passed by the
Revisional Authority are liable to be setaside and a direction be issued to the
Authority to revise the demand in light of
the observations contained in the order
passed in Bikram Chatterji & others Vs.
Union of India and others (supra) and the
petitioner should not be forced to pay the
additional compensation till the Supreme
Court decides the pending issue.

21. On other hand, Mr. Prashant
Kumar, learned counsel for the GNIDA,
and Mr. Sanjay Mishra, learned Additional
Chief
Standing
Counsel,
representing
respondents-State, have submitted that total
liability is of Rs.67,78,23,456/- in respect
of the Industrial Plot No. 2, Sector Ecotech16, GNIDA, ad-measuring 58271 square
meters allotted to the petitioner by the
GNIDA. It has been further submitted that
the allotment letter contains the map of the
allotted plot, terms & conditions for
allotment as well as payment schedule.
After accepting the allotment letter and
executing the sale-deed, the petitioner
cannot
come
before
this
Court
for
amendment of the contract/lease deed
entered into between the petitioner and the
GNIDA. The petitioner was given physical
possession on 24.06.2011. The building
plan got approved on 15.10.2012 for
manufacturing of concrete-precast. The
petitioner, after completing construction of
the industrial unit, started commercial
production in August, 2013, but did not
make payment as per schedule and, in fact
no payment has been made till date despite
the unit had started commercial production
in the year 2013 itself. It has been further
submitted that the petitioner's unit is fully
operational.

22. The amenities would not mean
providing of raw-material for commercial
unit working within the development area
under the Authority. Water is one of the
raw-materials for production of concreteprecast. There is no obligation on the part
of the Authority to provide water, which is
used as a raw-material. It has been further
submitted that the petitioner has created a
smoke screen to hide its failure to make
payment of dues and, there is no substance
in the writ petition, which is liable to be
dismissed.

22. Mr. Prashant Kumar, learned
counsel representing the Authority, has
further submitted that the GNIDA provides
4 All. M/S Supertech Precast Tech. Pvt. Ltd. Vs. State of U.P. & Anr.
861
water to industrial unit by following three
modes:-

i. via tanker wherein the respondent
no. 2 Authority provides the recycled water
from the STPs and supply them to the
industries at the cost of the industries itself;

ii. laying pipeline the respondent
authority
under
a
Memorandum
of
Understanding with the industrial unit lay
pipeline of the recycled water; and

iii. connection of recycled water the
respondent no.2 after taking a requisite fee
provide connection of recycled water from
already laid pipeline in the vicinity.

However, the Authority did not have
power to grant permission for digging borewell for use of water commercially. It is the
Central Ground Water Authority, which is
empowered to grant approval for extraction
of ground water for commercial use. The
Authority has already provided all the
amenities, as it is required to provide and,
there is no substance in the submissions
made by Mr. Anil Tewari, learned Senior
Advocate, on behalf of the petitioner that
the amenities were not provided to the
petitioner. The Authority had already
provided the amenities like water, drainage,
waste management, however, providing of
water for commercial use does not come
within the purview of the amenities.

23. The Central Government, in
compliance
of
the
judgment
dated
10.12.1996 passed by the Supreme Court in
Civil Writ Petition No.4677 of 1985 (MC
Mehta Vs. Union of India) had constituted
the Central Government Ground Water
Authority in exercise of power under
Section 5 of the Environment (Protection)
Act, 1986 with a special purpose to
regulate and control development and
management of ground water resources in
the country. It is the Central Government
Ground
Water
Authority,
which
is
empowered to grant no objection certificate
for extraction of ground water and the
GNIDA has no power or authority to grant
'no objection certificate'.It has been further
submitted that the grievances of the
petitioner is wholly untenable and the
petitioner, who has failed to make payment
of its dues which as of today stands to
Rs.67,78,23,456/-. The petitioner is not
entitled for any relief from this Court as the
petitioner has violated the terms and
conditions.

24. It has been further submitted that
the reliance placed by the petitioners on
judgment/order passed by the Supreme
Court in Bikram Chatterji & others Vs.
Union of India and others (supra) is not
applicable to the facts of this case. There is
no question of clearance inasmuch the
petitioner was given possession on due date
of the land and the petitioner started its
commercial production in August, 2013
and, therefore, the petitioner cannot latch
on the orders passed by the Supreme Court
in the aforesaid two cases.

25. I have considered the submissions
made by the learned counsel for the parties.

26. Industrial development authorities
are creation of the Statute with specific
purpose. The main work of the Authority is
to facilitate industrial and commercial
activities within its area and, for that
purpose to provide infrastructure i.e. land,
road, electricity, water and drainage etc.
The
purpose
of
Authority
is
not
profiteering, but to see the industrial and
economic growth by providing congenial
environment and infrastructure so that
industrial and commercial activities are
carried out within its area for overall
economic growth of the area and the State.
862 INDIAN LAW REPORTS ALLAHABAD SERIES

27. It is admitted in the counter
affidavit, as stated above, that the Authority
provides water connection for commercial
use by three modes, mentioned above. In
view thereof, Mr. Prashant Kumar, learned
counsel for the GNIDA, has submitted that
if the petitioner is ready to bear the cost and
burden for laying down pipelines etc, the
Authority would provide water from STP
through pipeline, provided the petitioner
should come to the office of the Authority
and make a request and settle the dues.

28. In view of the aforesaid
submissions, I direct the petitioner to make
deposit of Rs.1 Crore (Rupees One Crore)
within 15 days from today with the
Authority and the Authority shall provide
the cost etc. for laying down pipelines for
providing
water
through
STP
for
commercial use at the prevailing rates.

29. So far as the question of
additional compensation of Rs. 5 Crore is
concerned,
a
Coordinate
Bench
at
Allahabad vide judgment and order dated
18.09.2019 passed in Writ-C No.18684 of
2019 and connected Writ-C No.17643 of
2019 quashed the demand of additional
compensation of Rs.1,769/- per square
meter for Group Housing Yojana, as was
fixed by the Board of Authority on
31.05.2019, and remitted the matter back to
the Authority for taking decision afresh,
strictly in light of the observations made in
the judgment. Operative portion of the
judgment dated 18.09.2019 passed in the
said writ petitions is quoted herein below:-

"Another aspect which would merit
consideration is the apportionment of
compensation
amongst
allottees.
As
contended by the petitioners here the
loading of additional compensation must
necessarily have a nexus and correlation to
the area of land allotted and the additional
compensation cost created in respect of
that area by the Authority. This submission
clearly appears to be sound for the
adoption of any other method may lead to a
charge of discrimination amongst allottees
that do not constitute the same class. It
would essentially result in the creation of
liabilities having no nexus or correlation to
the
actual
liability
of
additional
compensation ultimately borne by the
Authority in respect of the allotted piece of
land.
The
computation of additional
compensation would depend upon a host of
variables such as the situation of the plot,
its area, the number of individuals whose
holdings were acquired in connection
therewith and the amount of additional
compensation ultimately paid. There can be
no computation of proportionate liability
without these factors being taken into
account and consideration. In the absence
of any explanation or justification offered
by the Authority, the Court finds itself
unable to sustain the creation of the
liability against the petitioner as embodied
in the impugned order on this score also.

The Court also bears in mind that the
creation of liability does not affect the
petitioners alone. It would also impact the
interests of numerous individual allottees of
the proposed Group Housing Scheme.
Their interests cannot be ignored bearing
in mind the harsh economic realities of the
housing sector. The Authority would be
well advised to bear all the aforesaid
aspects in mind before proceeding to
compute the liability to be borne by the
petitioners.

Accordingly and for the reasons
aforenoted the instant writ petition is
allowed. The impugned order dated 2 July
2019 is hereby quashed. The matter is
remitted to the Authority for taking a
decision afresh strictly in accordance with
4 All. M/S Supertech Precast Tech. Pvt. Ltd. Vs. State of U.P. & Anr.
863
the observations made hereinabove. Since
the completion certificate has already been
granted to the petitioner pursuant to the
interim directions issued and in view of the
result of the instant petition, the same is
made absolute. The issue of refund of
moneys already deposited by the petitioner
towards additional compensation shall be
open to be raised dependent upon the fresh
decision that the Authority shall now take
in light of the directions issued."

30. A Division Bench of this Court in
Writ-C
No.28968
of
2018
(M/s
Shakuntala Educational and Welfare
Society Vs State of U.P. and others) and
other connected matters vide judgment
and order dated 28.05.2020 had quashed
the Resolution of Board of the Yamuna
Expressway
Industrial
Development
Authority
dated
15.09.2014
and
the
Government Order dated 29.08.2014 for
recovering
additional
payment
of
compensation from the allottees. It has
been held that the lease-deed is required to
be registered both under the provisions of
the Transfer of Properties Act and the
Registration Act. The amount of premium
or the sale consideration, mentioned
therein, is not liable to any change
otherwise than by execution of another
registered instrument. It has also been held
that the Full Bench decision in Gajraj and
others Vs. State of U.P. and others (2011)
ADJ 1 (FB), which was approved by the
Supreme Court in the case of Savitrai Devi
and others Vs. State (2015) 7 SCC 21, is
not judgment in rem and same could not be
applied to proceedings for acquiring the
land under different notifications. It was
also held by this Court that issuance of
Government Order dated 29.08.2014 and
its acceptance by the by the Yamuna
Express Industrial Development Authority
is patently illegal and it was violative of
provisions of the Land Acquisition Act and
even otherwise without jurisdiction. The
concluding part of the judgment is quoted
herein below:-

(i) The decision in the case of Gajraj
as approved by Savitri Devi is not a
judgement in rem which could have been
applied to proceedings for acquiring the
land under different notifications or for
Y.E.I.D.A.;

(ii) the issuance of the Government
Order dated 29.08.2014 and its acceptance
by Y.E.I.D.A. is patently illegal. It is
violative of the provisions of the L.A. Act
and is otherwise without jurisdiction as no
such Government Order is liable to be
issued in equity by the Government and
that the policy behind it is unfair,
unreasonable and arbitrary which is in
violation of the provisions of the T.P. Act;
and

(iii) the aforesaid Government Order
dated 29.08.2014 as such is held to be
invalid
and
liable
to
be
ignored.
Consequentially, all actions and demands
of the Y.E.I.D.A. based upon it are held to
be illegal.

In
view
of
above
facts
and
circumstances, the impugned Government
Order dated 29.08.2014 is declared to be
illegal
and
without
jurisdiction
and
consequently all demands raised on its
basis are quashed."

31. The said judgment has been
challenged in the Supreme Court, which is
pending for final disposal. In view thereof,
since
the
demand
of
additional
compensation has been decided by the
Division Bench of this Court, the same
should not be enforeced against the
petitioner till disposal of Petition for
Special Leave to Appeal (C) Nos.1001510034 of 2020 pending before the Supreme
864 INDIAN LAW REPORTS ALLAHABAD SERIES
Court. In case the Supreme Court allows
the said Special Leave Petitions, the
petitioner would be liable to pay the
additional compensation.

32. The 3rd issue, which requires
consideration by this Court, is the rate of
interest and penal rate of interest. As
mentioned
above,
the
purpose
of
Authority is not profiteering, but to
provide infrastructure facilities/amenities
for industrial and economic growth and
commercial activities in the area under its
control. Besides interest @ 12% per
annum on premium compounding penal
interest @ 14% would make an industry
unviable. It could not be the purpose of
Authority to allow industries to be set up
and then make same unviable. The
Supreme Court in the case of Bikram
Chatterji & others Vs. Union of India and
others (supra) has directed the Authority
for charging the interest at bank rate on
the outstanding amount from Amraprali
Group of Housing Company. In this case,
as noted above, interest is 12% per
annum on premium on six monthly basis
and in default, the penal interest is to be
charged @ 14% per annum. Such a high
rate of penal interest besides the interest
@ 12% per annum on premium is surely
enough to bleed the industry and make it
unviable.

33.

In
my
view,
the
State
Government must consider to revise rate
of interest to make it compatible with
the bank interest with 2% more and
penal interest should also not exceed
more then 6%. In view thereof, the
present writ petition is allowed. The
impugned
order
dated
25.11.2020,
impugned
demand
letter
dated
06.01.2021 and impugned letter of
cancellation dated 29.09.2021, copies of
which are contained in Annexure Nos. 1,
2 and 3 to the petition, are quashed. The
matter is remitted back with following
directions:-

I. The petitioner will deposit Rs. 1
Crore with the Authority within 15 days
from today and make the payment for
laying down the pipeline from STP to its
unit for making supply of STP water for
its industrial unit at the applicable rate.
The Authority should lay down the
pipeline after receiving the cost and
provide the water to the industrial unit
so that its cost of manufacturing of
concrete
precast
gets
reduced
and
industrial unit becomes viable.

II. So far as levy of penal interest is
concerned, the matter is remitted back to
the Revisional Authority
i.e. State
Government to reduce it to 6% per
annum instead of 14% per annum on
default of payment of premium and
allow the petitioner to pay the premium
along with interest (12% + 6%, total
18% per annum simple interest) in
installments, may be spread over to 5-7
years.

III. So far as payment of additional
premium is concerned, it should be
deferred till decision of the Supreme
Court in Special Leave to Appeal (C)
Nos.10015-10034 of 2020.
The petitioner should furnish an
undertaking to the effect that it will
abide by the decision of the Supreme
Court and, in case the Supreme Court
allows the said SLPs, it shall make the
payment of additional compensation
without any demur.

IV. Revisional Authority is directed
to pass a fresh order within a period of
one month after affording an opportunity
of hearing to the petitioner.
----------
4 All. Nand Kumar Maurya Vs. State of U.P. & Ors.
865
(2022)04ILR A865
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 16.02.2022

BEFORE

THE HON'BLE ANJANI KUMAR MISHRA, J.
THE HON'BLE VIKRAM D. CHAUHAN, J.

Writ-C No. 31925 of 2021

Nand Kumar Maurya ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Udayan Nandan, Sri Shashi Nandan (Sr.
Advocate)

Counsel for the Respondents:
C.S.C., Sri Akhilesh Kumar, Narendra Kumar, Sri
Veer Singh

Civil Law - Constitution of India, 1950 -
Article 226, - U.P. Municipalities Act, 1916
- Sections 48, 48 (2), 48(2)(b) & 82 - Writ
Petition - challenging the Show Cause
Notice and impugned order of ceasing the
Financial & Administrative power of the
petitioner who is the President of a Nagar
Panchayat - on account of a complaint in
respect of irregularities in purchase of
dustbins - 1st enquiry report submitted by
SDM - petitioner was exonerated
-
Additional
Commissioner
without
providing any opportunity of hearing
directed for fresh enquiry - enquiry report
submitted by another SDM - show cause
notice was issued - petitioner submitted
written explanation as well as produced
the enquiry committee constituted by the
DM - report forwarded before Addl. Chief
Secretary - impugned notice - petitioner
replied - impugned order passed by the
St. Govt. - writ petition - while passing
the impugned orders St. Govt. neither
objectively considered the material &
reply of the petitioner nor discussed the
same - orders issued under section 48(2)
of the Act, for cessation of financial &
administrative powers should reflects the
'due application of mind' applied by the
authority concern - writ petition allowed -
impugned order is set aside - matter
remitted
back
to
proceed
afresh
in
accordance with law.(Para - 28, 31, 35, 36)

Writ Petition allowed. (E-11)

List of Cases cited: -

1. Paras Jain Vs St. of U.P. & ors.(2016 vol. 1
ADJ 1 FB),

2. Hafiz Ataullah Ansari Vs St. of U.P. &
ors.(2011 vol. 3 ADJ 502 FB)

(Delivered by Hon'ble Vikram D.
Chauhan, J.)

1. The present writ petition is
preferred by the petitioner challenging the
show cause notice dated 11th November,
2021 issued by the Additional Chief
Secretary, Nagar Vikas, U.P. at Lucknow,
whereby the petitioner has been show
caused as to why he may not be removed
from the office of the President, Nagar
Panchayat, Khamariya, District Bhadohi
and further by the impugned order dated
11th November, 2021 the financial and
administrative powers of the petitioner has
been ceased.

2. The brief facts of the case is that
the petitioner is the President, Nagar
Panchayat, Khamariya, District Bhadohi. In
respect of the alleged irregularities in
purchase of dustbins in Nagar Panchayat,
Khamariya, District Bhadohi, an enquiry
was conducted by the Sub Divisional
Magistrate, Aurai, District Bhadohi and a
report was submitted on 24th June, 2019.
The aforesaid enquiry was conducted on
the basis of the complaint made by one Sri
Mainuddin Ansari, Sabhasad, Ward No. 12,
Akbarpur and other Sabhasad, Nagar
Panchayat, Khameriya, District Bhadohi.