# INFRASTRUCTURE DEVELOPMENT BOARD & ORS v. B. S. S. PARIHAR & ORS

- **Citation:** [2015] 6 S.C.R. 841
- **Court:** Supreme Court of India
- **Decided:** 2015-07-21
- **Case number:** Civil Appeal No.1801 of 2015
- **Bench:** V. Gopala Gowda, R. Banumathi
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/infrastructure-development-board-ors-v-b-s-s-parihar-ors-30817
- **Pages:** 45

## Headnote

Housing - Housing Scheme - By State Housing and c
Infrastructure Development Board- Cost of developed plots
initially fixed at Rs. 16, 5001- per sq. mfr. as per Rules of the
Board - Final demand by the Board from the allottees after
fixing the sale price at Rs. 30, 0001- per sq. mtr. - Final demand
at enhanced rate challenged - Single Judge and Division D
Bench of High Court quashed the enhanced/final demand -
On appeal, held: The advertisement of the housing scheme
in the newspaper specifically stated that the price was
provisional - The final sale price was fixed in accordance
with the provisions of Griha Nirman Manda/ Adhiniyam and E
Housing Board Accounts Rules - Hence the Board was not
debarred from raising the cost of construction or claiming
enhanced prices for the land - However, the said
enhancement is arbitrary, unreasonable, unfair and without
applying the principle of the doctrine of proportionality and F
thus violative of Art. 14 of the Constitution - The determination
of final cost of the land should have been in consonance
with the doctrine of proportionality and not on the basis of
the market price - It would be just and proper to take into
consideration the cost of developed plots at Rs. 16, 5001- per G
sq. mtr. and take escalation@10% for every year from 2007
to 2011 and ask the allottees to pay simple interest thereon
- Constitution of India, 1950 - Art. 14 - Madhya Pradesh
Griha Nirman Manda/ Adhiniyam, 1972 - s.50 - Madhya H
841
842
SUPREME COURT REPORTS
[2015) 6 S.C.R.
A Pradesh Housing Board Accounts Rules, 1991- Stamp Act,
1899-s.47(a)-Madhya Pradesh Preparation and Revision
of Market Value guidelines Rules, 2000- Rules 4(2) and 75.
Precedent -: Precedential value of a judgment - Any
B declaration or conclusion arrived at without application of
mind or preceded without any reason cannot be deemed to
be declaration of law of a general nature and cannot be
deemed as a precedent.
c
Partly allowing the appeals, the Court.
HELD: 1.1
It is not correct to say that once the
appellant-Board has made the allotment of the said plot
of land, it is debarred from raising the cost of
0
construction or claiming enhanced prices for the said
land, in view of the clauses contained in the
advertisement published in the newspaper which read
that the cost of the houses shown in this advertisement
are totally provisional and the final fixation of the price
E will be done after the completion of the Scheme.
Therefore, the allottees will have to pay the difference
between the tentative cost and the final sale price of the
land which is based on the fixation of the final cost of
the land, within the stipulated time. [para 21)(855-H; 856F A-C]
1.2 Further, the said clause is also traceable to
Section 50 of the Madhya Pradesh Griha Nirman Mandal
Adhiniyam, 1972, wherein the appellant-Board is
G empowered to retain, lease, sell, exchange or otherwise
dispose of any land, building or other property vesting
with it, situated in the area comprised in any housing
Scheme or in any adjoining area. [para 22] [856-E-F]
1.3 Thus, the final sale price which is fixed and
H intimated to the allottees is in accordance with the
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 843
B. S. S. PARIHAR
provisions of the 1972 Act, Madhya Pradesh Housing A
Board Accounts Rules, 1991 and the clause of the
advertisement which is binding on the respondent
allottees. Therefore, the High Court has committed an
error in law by quashing the demand notice of the
appellant-Board for the payment of the final sale price.
B
(para 23) (858-A-B]
1.4 The provisos issued by the Central Valuation
Board vide letter No. 713/Ga.La./2011 Bhopal dated
29.03.2011 for the implementation of the rates of plots C
of land, buildings and agricultural land in Rule 3(2) of
the Rules, 2000 and the after approval of the rate of the
market price proposed by District Valuation Committee
Guiding Principles (Guidelines) for the year 2011-2012
for reckoning the market price of the immovable pr

## Text

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[2015) 6 S.C.R. 841
MADHYA PRADESH HOUSING AND
A
INFRASTRUCTURE DEVELOPMENT BOARD & ORS.
v.
B. S. S. PARIHAR & ORS.
(Civil Appeal No.1801 of 2015)
JULY 21, 2015
B
[V. GOPALA GOWDA AND R. BANUMATHI, JJ.]
Housing - Housing Scheme - By State Housing and c
Infrastructure Development Board- Cost of developed plots
initially fixed at Rs. 16, 5001- per sq. mfr. as per Rules of the
Board - Final demand by the Board from the allottees after
fixing the sale price at Rs. 30, 0001- per sq. mtr. - Final demand
at enhanced rate challenged - Single Judge and Division D
Bench of High Court quashed the enhanced/final demand -
On appeal, held: The advertisement of the housing scheme
in the newspaper specifically stated that the price was
provisional - The final sale price was fixed in accordance
with the provisions of Griha Nirman Manda/ Adhiniyam and E
Housing Board Accounts Rules - Hence the Board was not
debarred from raising the cost of construction or claiming
enhanced prices for the land - However, the said
enhancement is arbitrary, unreasonable, unfair and without
applying the principle of the doctrine of proportionality and F
thus violative of Art. 14 of the Constitution - The determination
of final cost of the land should have been in consonance
with the doctrine of proportionality and not on the basis of
the market price - It would be just and proper to take into
consideration the cost of developed plots at Rs. 16, 5001- per G
sq. mtr. and take escalation@10% for every year from 2007
to 2011 and ask the allottees to pay simple interest thereon
- Constitution of India, 1950 - Art. 14 - Madhya Pradesh
Griha Nirman Manda/ Adhiniyam, 1972 - s.50 - Madhya H
841
842
SUPREME COURT REPORTS
[2015) 6 S.C.R.
A Pradesh Housing Board Accounts Rules, 1991- Stamp Act,
1899-s.47(a)-Madhya Pradesh Preparation and Revision
of Market Value guidelines Rules, 2000- Rules 4(2) and 75.
Precedent -: Precedential value of a judgment - Any
B declaration or conclusion arrived at without application of
mind or preceded without any reason cannot be deemed to
be declaration of law of a general nature and cannot be
deemed as a precedent.
c
Partly allowing the appeals, the Court.
HELD: 1.1
It is not correct to say that once the
appellant-Board has made the allotment of the said plot
of land, it is debarred from raising the cost of
0
construction or claiming enhanced prices for the said
land, in view of the clauses contained in the
advertisement published in the newspaper which read
that the cost of the houses shown in this advertisement
are totally provisional and the final fixation of the price
E will be done after the completion of the Scheme.
Therefore, the allottees will have to pay the difference
between the tentative cost and the final sale price of the
land which is based on the fixation of the final cost of
the land, within the stipulated time. [para 21)(855-H; 856F A-C]
1.2 Further, the said clause is also traceable to
Section 50 of the Madhya Pradesh Griha Nirman Mandal
Adhiniyam, 1972, wherein the appellant-Board is
G empowered to retain, lease, sell, exchange or otherwise
dispose of any land, building or other property vesting
with it, situated in the area comprised in any housing
Scheme or in any adjoining area. [para 22] [856-E-F]
1.3 Thus, the final sale price which is fixed and
H intimated to the allottees is in accordance with the
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 843
B. S. S. PARIHAR
provisions of the 1972 Act, Madhya Pradesh Housing A
Board Accounts Rules, 1991 and the clause of the
advertisement which is binding on the respondent
allottees. Therefore, the High Court has committed an
error in law by quashing the demand notice of the
appellant-Board for the payment of the final sale price.
B
(para 23) (858-A-B]
1.4 The provisos issued by the Central Valuation
Board vide letter No. 713/Ga.La./2011 Bhopal dated
29.03.2011 for the implementation of the rates of plots C
of land, buildings and agricultural land in Rule 3(2) of
the Rules, 2000 and the after approval of the rate of the
market price proposed by District Valuation Committee
Guiding Principles (Guidelines) for the year 2011-2012
for reckoning the market price of the immovable property D
(plots of land, building and agricultural land) situated in
District Bhopal under Rule 4(2)(c) of the Rules, 2000,
are forwarded by the Sub-Registrar of the Districts for
the purpose of issuing directions under Section 47-A,
sub-Section (1) of the Indian Stamp Act, 1899. The said E
valuation fixed by the District Valuation Committee under
the Chairmanship of the District Collector of Bhopal is
not under challenge by either the allottees or any other
person. Therefore, the guiding principles for the F
determination of the final sale price of the plots in favour
of the allottees cannot be termed as either erroneous or
error in law. (para 27] [860-F-H; 861-A-B]
Tamil Nadu Housing Board v. Service Society & Anr
2011 (6) scR 1 = 2011 (11) sec 13; Delhi
Development Authority vs. Pushpendra Kumar Jain
1994 (3) Suppl. SCR 110 = 1994 (3) Suppl. sec 494
-relied on.
M.P. Housing Board v. Anil Kumar Khiwani 2005 (2)
SCR 765 = 2005 (10) SCC 796 - held inapplicable.
G
H
844
SUPREME COURT REPORTS
[2015] 6 S.C.R.
A
2. Any declaration or conclusion arrived at without
B
application of mind or preceded without any reason
cannot be deemed to be declaration of law or authority
of a genli!ral nature and the same cannot be deemed as
a precedent. [para 27] [861-C-D]
Bihar School Education Board v. Suresh Pd. Sinha
(2009) 8 SCC 483; State of U.P v. Synthetics &
Chemicals Ltd. (1991) 4 SCC 139 - relied on
c
Tamil Nadu Housing Board v. Service Society & Anr
2011 (6) SCR 1 = 2011 (11) SCC 13 - referred to
3.1. The appellant-Board is entitled to fix the final
cost of the land and the same is legal and valid. However,
0 the same has been done arbitrarily, unreasonably,
unfairly and without applying the principle of the doctrine
of proportionality. The determination for the final price
of the plots allotted to the allottees must be on the basis
of the appellant-Board Rules read with the relevant
E aspects namely, the Collector's Guidelines, the 1972 Act
and the 1991 Rules, for the purpose of determination of
the market value of the land. A statutory duty is cast
upon the appellant-Board which is governed by the
provisions of the Act and Rules and the appellant-Board
F being the statutory Board is amenable to Article 14 of
the Constitution of India. The determination of the final
cost of the land in dispute must be in consonance with
the doctrine of proportionality but not on the basis of
the market price, i.e. fixed by the Committee for the
G determination of guidance value of the immovable
property in the District which would be arbitrary,
unreasonable and unfair. [para 31] [882-A-E]
3.2 As per the advertisement published by the
H appellant-Board, the estimated cost of the House of HIG
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 845
B. S. S. PARIHAR
was Rs.40 lakhs and in view of the approved minimum A
bid rates, the costs of the aforesaid type of houses were
likely to increase by Rs.9.53 lakhs. The said value is for
the final determination of the revised estimated cost of
house which is taken into consideration by applying the
Collector's guidelines, the same will be arbitrary and B
unreasonable. Therefore, the doctrine of proportionality
must come into play for the determination of the final
price of the allotted plot, keeping in view the relevant
factors namely, the escalation of the cost of the building
materials and the cost of land which are re-determined C
as the land is acquired by the State Government in favour
of the appellant-Board and the State Government will
have to pay the enhanced compensation of the land to
the land owners. The relevantfactorto be borne in mind D
for the purpose of re-determination of the cost of the
land is that the relevant period from the date of
advertisement in the year 2007 to 2010 should be taken
into consideration. [para 32] [882-F-H; 883-A-C]
3.3 The demand made by the appellant-Board from E
the allottees after the cost of the land was determined
at Rs.30,000/- per sq. mtr. is near about double the cost
of the developed plots for the Duplex and Triplex houses
which were earlier fixed at Rs.16,500/- as per the Rules F
of the Board. There is no justification on the part of the
appellant-Board to fix the price of the land at Rs.30,000/
- per sq. mtr. and placing the said demand on the
constructed HIG houses, from the respondent-allottees
would be most unreasonable and unfair. Therefore, by G
maintaining the balance between the figure Rs.16,500/-
and Rs.30,000/-, it would be just and proper to take into
consideration the cost of the developed plots at
Rs.16,500/- per sq. mtr. and take the escalation at the
rate of 10% for every year from 2007 to 2011 and ask the H
846
SUPREME COURT REPORTS
[2015] 6 S.C.R.
A respondent-allottees to pay simple interest on the said
sum. The same would be in conformity with the doctrine
of proportionality and it will pass the test of
reasonableness and fairness. [para 33] [883-D-H]
B
Coimbatore District Central Coop. Bank v. Employees
Association 2007 (5) SCR 430 = 2007 (4) SCC 669;
Teri Oat Estates (P) Ltd. v. U. T. Chandigarh 2003 (6)
Suppl. SCR 1235 = 2004 (2) SCC 130, Om Kumar
v. Union of India 2000 (4) Suppl. SCR 693 = 2001
c
(2) SCC 386; State of U.P. v. Sheo Shanker Lal
Srivastava 2006 (2) SCR 656 = 2006 (3) SCC 276
- relied on.
Case Law Reference
D
1994(3)Suppl.SCR 770
relied on
para 15
2011 (6) SCR 1
relied on
para 24
(2009) 8 sec 483
relied on
para 27
E
(1991) 4 sec 139
relied on
para 27
2005 (2) SCR 765
held inapplicable
para 27
2007 (5) SCR 430
relied on
·para 29
F
2003(6)Suppl. CR 1235 relied on
para 29
2000(4)Suppl.SCR 693
relied on
para 29
2006 (2) SCR 656
relied on
para 29
G
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
1801 of 2015.
From the Judgment and Order dated 31.07.2014 of
H the High Court of Madhya Pradesh, Principal Seat at Jabalpur
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 847
B. S. S. PARIHAR
in Writ Appeal No. 1565 of 2013.
A
WITH
Civil Appeal Nos. 1802-1803 of 2015.
Sunil Gupta, Sushil Dutt Salwan, Nikunj Dayal, Paya!
B
Dayal, Nipun Goel, Pramod Dayal for the Appellants.
M. L. Lahoty, Paban K. Sharma, Gargi B. Bharali,
Hemant Shrivastava, Himanshu Shekhar for the
Respondents.
C
The Judgment of the Court was delivered by
V. GOPALA GOWDA, J. 1. Civil Appeal No. 1801 of
2015 by special leave has been filed against the impugned 0
judgment and order dated 31.7.2014 passed in Writ Appeal
No. 1565 of 2013 by the High Court of Judicature at Madhya
Pradesh at Jabalpur, whereas C.A. Nos. 1802-1803 of 2015
by special leave have been filed against the impugned
judgment and order dated 31.7.2014 passed in Writ Appeal E
Nos. 1550 of 2013 and 1563 of 2013 by the same High Court.
In both the matters, the dispute relates to the fixation of the
price of the under construction 36 Duplex/Triplex HIG
Houses, situated in "Riviera Towne", Bhopal, by the appellantMadhya Pradesh Housing and Infrastructure Development F.
Board (for short "the appellant-Board") and the method
adopted by them for fixing the price of the properties in
dispute and linking the cost price of the land with the
Collector's guidelines on the date of completion of the project
in the case of Self Financing Scheme. The High Court G
dismissed the writ appeals filed· by the appellant-Board and
quashed the enhanced/final demand for price fixation of land
by the appellant-Board.
2. The brief facts of the case are stated hereunder to H
848
SUPREME COURT REPORTS
[2015) 6 S.C.R.
A appreciate the rival legal contentions urged on behalf of the
parties:
An advertisement was published on 9.11.2007 in the
local daily newspaper 'Dainik Bhaskar' regarding the Housing
B Scheme which was floated by the appellant-Board for the
allotment of 36 residential houses for the employees of the
State Government and the State Public Sector Undertaking
under the name of "Riviera Towne" in Bhopal with the
c
D
E
following terms and conditions :-
;-1-. -~ApPJicatiOn fOrmS for residentiafhouses in Rlviera Tcmne, 1
Bhopal can be purchased at a cost of Rs.25Ql- from the
Punjab National Ban~ R.S.S. Market Panch Bus Stop,
Bhopal on all working days between 21.11.2007 and .
7 .12. 2007
and
Registration
Amount/Banker's i
Cheque/Demand Drafts can be deposited in the above :
bank on all working days till 7.12.2007.
'
I
I
~
-
--- -
2.
In case the-number of applications are morethan the~I
number of premises advertised for sale, the registration
will be done through a system of lottery which will be held .
at 4.00 pm on 14.12.2007 in the office of Estate Officer.
3.
Prefererice-m -ieglsiration will be giVenTo those-whclpay
the total estimated amount in one lump sum.
--- -------
-
. - ·-- - ---· ---· - -- - ·--
---
4.
Apart from the sale price, other charges and maintenance
F
fee shall be payable as per the Board rules.
1 5.
Once registration is sanctioned under Self Financing :
'
Scheme, the applicants have to pay the balance amount I
in instalments as per the intimation given by the Board.
16.
G
I
Costs of the houses shown in this advertisement are .
totally provisional and the final fixation of the price will be I
done after completion of the Scheme. Allottees have to
1
pay the difference of tentative cost and final sale price in :
fixation of final cost on intimation within the time ;
stipulated.
I
H
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 849
B. S. S. PARIHAR [V. GOPALA GOWDA, J.]
A
7.
~~~:r laxes-aiici 1e·ase re-niSh-alibep-ayabie-asileJ
1-=-8_--i·~A-p~pl~ica~tions for reglstraHori- are - in-vifed from-the
officers and employees of various departments of the
Madhya
Pradesh Government and
undertakings
B
Institutions.
Reservation
of houses
will
be
in i
accordance with the rules.
I
i
R- Even after pub-lication of two adve-rtisem en ts-for l
registration of the house, if so me houses still remain !
I
available, then application will be invited from General :
Category as per rules.
~
~0-t-he-r ter-ms and conditions-apply ___ -- _______ _J
,...-------- - -------, -- --- ----
--
-
--
----
-- ·----------- -- - - . -- -
-
Type ct
f'b. Pi:J!:rox
Pi:J!:rox. pot
8tirrated
Rl:g1.
l-b.s9
'
cai:a
a-ea in S:j.
COO: (in
famUl!Qn
'
.
i
I aea1n
rrtrs.
la<hs)
la<hs)
-
krrtrs..
---:-----+----
- ----- ---------------- --------
I Nee o.pex
j 18
1 184.57
1&> sq.rrtrs.
40.00
4
I
.
I
I Nee Triplex
I 14 i 228.25
1&> sq.ntrs.
45.00
4.&>
~----1-- ;. -- -
-
- - -
---- ---- ----
Nee D_pex 14
I 2'23.51
2'23 sq.ntrs.
53.00
5.&>
Carer
:
xxx
xxx
c
D
E
F
3. The appellant-Board held the draw of lots for the
allotment of the said houses in dispute and the successful
applicants were notified by the appellant-Board vide G
communication letter dated 20.12.2007 about the allotment
of the said houses in their favour. The appellant-Board also
took the administrative approval on 3.1.2008 for the
construction of 36 houses of the disputed properties. The
appellant-Board also constituted a Price Fixation Committee H
850
SUPREME COURT REPORTS
[2015] 6 S.C.R.
A
in its 199'" meeting for the fixation of the rational price' for
the said houses. They also issued two Circulars dated
30.9.2008 and 24.10.2008 relating to the fixation of cost of
the said properties in dispute.
i;i
4. The Price Fixation Committee worked out the prices
c
D
E
of the said 36 residential houses as mentioned below :-
[ Total F1at5-1a
-
- -
Total Flats-14
! Total Flats-4
-
· Plot area -150
Plot area-150 sq.
' Plot area-223 sq.
sq. mts.
mts.
I i mts.
i Built up areaBui It up area -
Built up area -
: 184.57 sq.mis.
228.25 sq. mts
223.51 sq. mts.
CostCost-
· CostRs.49,53,000/-
Rs.55 ,91,000/-
I Rs.66, 17,000/-
'
Upon getting the tentative cost of construction of the
houses and on the basis of the revised calculations and price
determination of the said properties in dispute and after the
receipt of tender, the demand letters were issued on
18.6.2009 to the respondent-allottees requesting them to
F submit their consent or dissent to the enhanced estimated
cost in writing within 15 days from the date of the issuance
of the letter.
5. The construction of the houses started from
G 30.6.2009 and almost 90% of the allottees gave their consent
to the revised cost of the properties in dispute as determined
by the appellant-Board on the report of the Price Fixation
Committee.
H
6. The appellant-Board, vide letter dated 7.7.2009,
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 851
B. S. S. PARIHAR [V. GOPALA GOWDA, J.]
sought for consent from the remaining allottees-respondents, A
who had not given their consent with regard to the revised
fixation of prices on the said disputed properties, stating
thereby that if they fail to do so, they will not be allotted the
houses and the registration amount that they had earlier
given towards the allotment of the houses will be refunded
B
to them with interest as per the rules of the Madhya Pradesh
Co-operative Societies Act, 1960 (hereinafter called as "the
Societies Act") and Madhya Pradesh Co-operative Societies
Rules, 1962(hereinafter called as "the Rules").
c
7. On 7.10.2009, the appellant-Board had informed that
all the allotments that were made to the respondents
subsequent to the issuance of the circulars dated 30.9.2008
and 24.10.2008, will be final and they will be bound by the
said circulars. The draw of lots was conducted on 22.12.2009 D
for the allocation of house numbers to the eligible applicants.
In the meeting held on 2.12.2011, it was decided by the
appellant-Board that all the allotments made to the respective
applicants will be governed by the notifications/circulars
regarding the cost of fixation of the properties in dispute and
E
also according to the appellant-Board.
8. The Price Fixation Committee in its meeting held on
9.12.2011 and in its report dated 15.12.2011, fixed the cost
with regard to the houses to be allotted under the said "Riviera
F
Towne" Scheme. In the report, the commencement of the
Scheme is to be considered to be from the date of the Work
Order and not from the date of the advertisement. Thereafter,
taking into consideration the final cost determined by the
Price Fixation Committee, the final demand letters were G
issued to the successful allottees on 24.12.2011.
9. Being aggrieved by the action of the appellant-Board,
the respondents filed Writ Petition No.15983 of 2012 before
H
852
SUPREME COURT REPORTS
(2015] 6 S.C.R.
A the learned single Judge of the High Court of Madhya
Pradesh, challenging the decision of the Price Fixation
Committee, whereby the appellant-Board has directed the
respondents to deposit the price for the said houses allotted
to them at a highly enhanced rate which is 300% more than
B the original price of the said properties in dispute. The
grievance of the respondents was that they had applied for
the said Scheme and had been allotted houses in the year
2007 at the price prevalent at the relevant period of time,
subject to reasonable escalation. But at the time of the
C delivery of possession of the said properties in dispute the
appellant-Board has demanded the price of Rs.30,000/-
instead of Rs.9,000/- per sq. mtr. which is highly unjustified
on its part. The respondents have further contended that
0
the appellant-Board has wrongly taken into consideration
the subsequent guidelines and notifications issued by the
Collector, notifying the price of the land for registration and
the stamp duty which is contrary to the law laid down by this
Court in a catena of cases.
E
10. The learned single Judge disposed of the said writ
petition on 24.9.2012, and directed the appellant-Board to
consider the representation of the respondents and the legal
opinion obtained by them and decide the matter in
F accordance with the decisions of this Court in a catena of
cases, after giving the respondent-allottees due opportunity
of being heard.
11. Though various representations were filed before
the appellant-Board by the allottees with regard to the fixation
G of the cost of the properties in dispute, the Commissioner of
the appellant-Board by order dated 8.3.2013, after
considering the representations of the respondent-allottees
and by referring to the various circulars regarding the cost
H fixation, rejected the representations of the allottees.
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 853
B. S.S. PARIHAR [V. GOPALA GOWDA, J.]
12. The said action of the Commissioner of the A
appellant-Board led the respondents to file Writ Petition
No.5690 of 2013 and connected writ petitions before the
learned single Jud,ge of the High Court. During this period 3
applicants did not make the initial payment of Rs.4 lakhs i.e.
10% of the advertised tentative cost which resulted in the B
cancellation of their registration to the said properties and
their duplex houses were put to auction.
13. The learned single Judge of the High Court disposed
of the Writ Petition No.5690 of 2013 along with the other C .
connected writ petitions vide its common order dated
21.11.2013. The learned single Judge allowed the writ
petitions of the respondents and directed the appellant-Board
to fix the price of the land as it existed on the date of issuance
of the allotment letter and consequently quashed the land D
price determined by the appellant-Board which was based
on the guidelines of the Collector.
14. Being aggrieved by the order dated 21.11.2013,
the appellant-Board filed Writ Appeals before the Division E
Bench of the High Court which were dismissed vide its
common order dated 31.7.2014. The Division Bench upheld
the findings of the learned single Judge, thereby quashing
the enhanced/final demand raised by the appellant-Board.
Hence, these appeals have been filed by the appellantF
Board, urging various legal grounds and contentions and
prayed to set aside the impugned order passed by the High
Court.
15. Mr. Sunil Gupta, the learned senior counsel G
appearing on behalf of the appellant-Board has relied upon
the judgment of this Court in the case of Delhi Development
Authority v. Pushpendra Kumar Jain', in support of his
case, wherein this Court has held that the allottee was bound
1 (1994) Supp (3) sec 494
H
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SUPREME COURT REPORTS
(2015] 6 S.C.R.
A to make the deposit at the enhanced rate as per the demand
raised by the D.D.A. if he wanted to secure the flat. It was
further held that an allottee gets an indefeasible right to
allotment only on the date of communication of allotment
and not on the date of draw of lots which is only a process to
B identify or select the persons for allotment and not the
allotment itself. It was further held that when the cost was
enhanced prior to the allotment letter, demand of the
enhanced rate was justified. The learned senior counsel has
contended that the impugned order of the High Court was
C not right as the same is contrary to the case of Delhi
Development Authority (supra), which is squarely
applicable to the fact situation of the instant case and the
High Court has failed on its pail oy 1gno1ing the same and
0
passing the order against the appellant-Board.
16. It has been further contended by the iearned senior
counsel that the High Court has gravely erred in determining
the price of the properties in dispute at a rate prevalent during
the period 2007-2008 or 2008-2009, as the appellant-Board
E has sold and executed the sale deeds of 1718 flats and 302
plots as per the guidelines of the Collector issued from time
to time which would become applicable to the allottees as
well.
F
17. The learned senior counsel has further contended
that the fixation of the cost of the properties in dispute has
been done in accordance with the Scheme, the rules and
the policy of the appellant-Board and the so-called allotment
made in favour of the allottees is not an allotment but only a
G registration granted to them which the High Court has
misconstrued as allotment of the said land.
18. On the contrary, the learned senior counsel
appearing on behalf of the respondents has sought to jul'tify
H the impugned judgment and order contending that the
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 855
B. S. S. PARIHAR [V. GOPALA GOWDA, J.]
judgment of the High Court is perfect and justified. He has A
contended that on the issue of fixing the price of the land,
the High Court has rightly held that the price or cost of the
said land should be in accordance with the price or the cost
of land which existed on the date of allotment.
B
19. He has further contended that the High Court has
rightly held that the date of allotment is the date on which
the offer of the respondents was accepted and their
applications were registerea a{)d the allotments to the land
were made accordingly, which i"S clear from a bare perusal C
of the letters indicating the acceptclhce of registration in
allotment.
20. The learned senior counsel has further contended
that the main dispute is with regard to the difference of the D
amount of the cost of the land that is being demanded by
the appellant-Board as per the Collector's guidelines
prevailing in the year 2011-12 and the actual cost that existed
on the date of allotment of the said land. The applicants
have already paid the entire cost as per the demand of the E
appellant-Board and have in fact paid 10% extra towards
the cost of the said property and despite the same, the
property has not been handed over to them which is a grave
miscarriage of justice and the respondents have been
suffering for a long time.
F
21. We have heard both the parties. On the basis of
the aforesaid rival legal contentions urged on behalf of the
parties and on perusal of the findings recorded by the High
Court in its impugned judgment and order, we have to answer G
the points of dispute on the basis of the evidence produced
on record. We record our reasons hereunder:-
The contentions urged on behalf of the respondents
that once the appellant-Board has made the allotment of H
856
SUPREME COURT REPORTS
[2015] 6 S.C.R.
A the said plot of land, it is debarred from raising the cost of
construction or claiming enhanced prices for the said land,
is wholly untenable in law in view of the clauses contained in
the advertisement published in the newspaper Oainik
Bhaskar dated 09.11.2007, which read that the cost of the
B houses shown in this advertisement are totally provisional
and the final fixation of the price will be done after the
completion of the Scheme. Therefore, the allottees will have
to pay the difference between the tentative cost and the final
sale price of the land which is based on the fixation of the
C final cost of the land, within the stipulated time.
Therefore, in view of the aforesaid clause, the allotment
of the said plot of land in favuur of th<> •espondent-allottees
is only provisional in nature and the same would be subject
D to the final fixation of the price of the land that will be done
after the completion of the Scheme as the said clause is
binding upon the respondent- allottees.
22. Further, the said clause is also traceable to Section
E 50 of the Madhya Pradesh Griha Nirman MandalAdhiniyam,
1972 (in short 'the Act, 1972'), wherein the appellant-Board
is empowered to retain, lease, sell, exchange or otherwise
dispose of any land, building or other property vesting with
it, situated in the area comprised in any housing Scheme or
F in any adjoining area. The Madhya Pradesh Housing Board
Accounts Rules, 1991, ( in short "the Rules, 1991 ") were
framed in this regard, the relevant provisions of which are
necessary to be extracted hereunder:
G
"5.4.SALE PRICE
Sale price of sites and buildings shall be separately
determined in accordance with the guidelines issued
by the Board. But wliere yield a sale price for any reason
H
different from cost price determined under Rule 5.3.2
M. P. HOUSING & INFRASTRUCTURE DEV. BC. \RO v. 857
B. S. S. PARIHAR [V. GOPALA GOWDA, J.]
and 5.3.3 (e.g. due to adoption of different rates of
overheads for different income groups, charging
premium from higher income groups for appreciation
in land value, grant of concessions to Board's
employees adoption of average expenditure on project
instead of year wise expenditure for calculating
overheads on interest, adoption of uniform rate of
interest of the entire construction period instead of
varying rates of interest for separate years), sales may
be brought to account in the revenue section of project
accounts without prejudice to the operation of Rules
5.3.2 and 5.3.3 (These rules deal with aci:-'.:lunt
adjustment in the expenditure section of project
account upto the state of recording under the account
head "cost of Sales"). Accordingly account adjustment
regarding capitalization of overheads, transfer of assets
from Divisions to Estate Management and incorporation
of costs in the account "Cost of Sales" in the ledgers of
Estate Management shall be carried out immediately
on completion of project and not held up till sale price
approved by the Competent Authority.
5.7 LAND
5.7.1 Land acquired shall be brought to account on
accrual basis, land made over to the Board free of cost
shall be brought to account at nominal price.
xxx
xxx
xxx
A
B
c
D
E
F
5.7.4 For the purpose of assessing the cost of a project,
G
i.e., debiting "Cost of Sales" as well for the purpose of
valuation of closing stock in Final Accounts,
appreciation in land value shall be ignored. The Board
may, however, take it into account for the purpose of
determination of sale price."
H
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SUPREME COURT REPORTS
(2015] 6 S.C.R.
A
23. The final sale price which is fixed and intimated to
the allottees is in accordance with the provisions of the Act
1972, the Rules, 1991 and the clause of the advertisement
which is binding on the respondent allottees. Therefore, the
High Court has committed an error in law by quashing the
B demand notice of the appellant-Board for the payment of
the final sale price and allowing the writ petitions of the
respondent-allottees without considering the terms and
conditions of the advertisement and the statutory provisions
of the Act and the Rules towards the fixation of the cost of
C the land. On this ground, the impugned judgments of both
the learned single Judge and the Division Bench of the High
Court are liable to be quashed and set aside.
24. The learned senior counsel on behalf of the
D appellant-Board has rightly pointed out the concurrent
findings recorded in the impugned judgment of the Division
Bench, which has referred to the judgment of the learned
Single Judge, wherein he has held that once the allotment
of the said plot of land is made, the appellant-Board is
E denuded of its power to seek enhanced cost of land based
on the Collector's guidelines, as erroneous in law. He has
also relied on the principles that have been laid down in
various cases of this Court including the cases of Tamil Nadu
F Housing Board v. Service Society & Anr2 and Delhi
Development Authority (supra). He has rightly pointed out
that the said conclusions of both the learned single Judge
and the Division Bench of the High Court are erroneous in
law and the same is a perverse finding of fact for the reason
G that they have misconstrued the registration of the
applications and the allotments made with respect to the
land in dispute which is in accordance with the clause
published in the advertisement. Reliance has been placed
in the case of Delhi Development Authority (supra) which
H reads thus:
2(2011)11 SCC13
M. P. HOUSING & INFRASTRUCTURE DEV. BO!.RD v. 859
B. S. S. PARIHAR [V. GOPALA GOWDA, J.]
"8 ........ No provision of law also could be brought to
our notice in support of the proposition that mere draw
of lots vests an indefeasible right in the allottee for
allotment at the price obtaining on the date of draw of
lots. l_n our opinion, since the right to flat arises only on
the communication of the letter of allotment, the price
or rates prevailing on the date of such communication
is applicable unless otherwise provided in the Scheme.
If in case the respondent is not willing to take or accept
the allotment at such rate, it is always open to him to
decline the allotment. We see no unfairness in the
above procedure."
A
B
c
25. The conditions stipulated in the advertisement
inviting applications from the applicants and the provision
provided under Section 50 Rule (5)(iv) of the Act of 1972 D
and Rules 5.7.1 and 5.7.4 of the Rules, 1991 would make it
clear that the law laid down in the Delhi Development
Authority (supra) case is aptly applicable to the fact situation
of the instant case. The same has not been considered by
the High Court while passing its impugned order. On this
E
ground also, the impugned judgment is liable to be set aside.
26. The learned senior counsel on behalf of the
appellant-Board has rightly pointed out that the determination
of the sale price of the flats allotted in favour of the F
respondent-allottees is based on the cost price fixed as per
the guidelines provided by the Collector from time to time
for the relevant year for the final allotment. He has further
pointed out that the total number of allottees who have
applied to the advertisement through the procedure of G
drawing the lottery for the allotment of flats in their favour
are 2531. The allottees who have accepted the final cost
are 1472. The allottees who have not accepted the final cost
and filed a petition against the same are 84. There are 975 H
860
SUPREME COURT REPORTS
[2015) 6 S.C.R.
A applicants who have vacant houses and are awaiting the
decision of the courts in other cases but they have neither
accepted nor refused the final cost fixation. Apart from the
said factual position, about 700 HIG & MIG and 1500 LIG
and EWS housing units would be further affected_ by the
B impugned judgment of the High Court. The legal issue that
is present for our determination is, whether the demand of
the final sale price which has been fixed by the appellantBoard in terms of the conditions stipulated in the
advertisement with regard to the land in dispute for the year
C 2010-2011 which has been done on the basis of the "Market
Price Guiding Principles, District, Bhopal" by the Collector
under Section 47(a) of the Indian Stamp Act, 1899 (Act NO.
2 of 1899), read with Section 75 of the Madhya Pradesh
D Preparation and Revision of Market Value Guidelines Rules,
2000 (hereinafter called as "the Rules, 2000"), framed by
the State Government for the determination of the market
price of immoveable property and the tier review under Rule
4(b) of Rules, 2000, the proposal of rates of market price for
E the year 2011-2012, submitted by the sub-District Valuation
Committee before the District Valuation Committee is legal
and valid?
27. The provisos issued by the Central Valuation Board
F vide letter No. 713/Ga.La./2011 Bhopal dated 29.03.2011
for the implementation of the rates of plots of land, buildings
and agricultural land in Rule 3(2) of the Rules, 2000 and the
after approval of the rate of the market price proposed by
District Valuation Committee Guiding Principles (Guidelines)
G forthe year 2011-2012 for reckoning the market price of the
immovable property (plots of land, building and agricultural
land) situated in District Bhopal under Rule 4(2)(c) of the
Rules, 2000, are forwarded by the Sub-Registrar of the
Districts for the purpose of issuing directions under Section
H 47-A, sub-Section (1) of the Indian Stamp Act, 1899. The
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 861
B. S. S. PARIHAR [V. GOPALA GOWDA, J.]
said valuation fixed by the District Valuation Committee under A
the Chairmanship of the District Collector of Bhopal is not
under challenge by either the allottees or any other person.
Therefore, the guiding principles for the determination of the
final sale price of the plots in favour of the allottees cannot
be termed as either erroneous or error in law. Further, the B
learned senior counsel for the appellant-Board has placed
reliance upon the judgment of this Court in the cases of BSEB
v. Suresh Pd. Sinha3 and State Of U.P. v. Synthetics &
Chemicals Ltd.4 in support of the proposition of law upon
the principal of binding precedents, wherein this Court has C
held that any declaration or conclusion a.rrived at without
application of mind or preceded without any reason cannot
be deemed to be declaration of law or authority of a general
nature and the same cannot been deemed as a precedent.
The learned senior counsel on behalf of the appellantBoard has further rightly placed reliance upon the judgment
D
of this Court in the case of Tamil Nadu Housing Board
(supra) in support of his legal submission wherein, this Court E
has held thus:
"18. There is no term or provision in the contract that if
the Board does not determine the final price within three
years from the date of allotment, the Board would lose
the right to determine the final price thereafter or that
the tentative price would become the final price. If on
account of delay in determination of compensation for
land aC;quisition or delay on the part of the contractors
in completing the development works or construction,
or if there are any encroachments or if there are pending
claims of contractors regarding development or
construction, the Board would not be able to determine
the final cost within three years. But that did not mean
3 (2009) s sec 483
4 (1991) 4 sec 139
F
G
H
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SUPREME COURT REPORTS
(2015] 6 S.C.R.
A
that the tentative cost would become the final cost in
the absence of such a provision in the letter of allotment
or lease-cum-sale agreement..
B
c
D
E
F
G
H
20. Clause 17 states that except the fixation of price
with reference to the compensation finally awarded by
the courts, the Board should fix the price of the LIG
house after taking into consideration the development
charges, cost of amenities and cost of buildings within
three years from the date of allotment. If the final price
is so fixed, thereafter what could be increaseel is only
the land cost component on account of any increase in
compensation that may be awarded by the courts. If
the Board had earlier fixed the final price:"the Society's
contention might have merited acceptance as the
component of price with reference to cost of
development and amenities and cost of building would
have attained finality on account of such final
determination and only the increase on account of
award of compensation for land could be demanded
after such determination of final price. But where the
final price has not been determined at all, for
whatsoever reason, and the final cost was being
determined for the first time, the allottee cannot contend
that only the increase on account of the land, and not
the increase on account of development cost and
construction cost, could be demanded. Where the final
price has not been fixed, the Board could, after
ascertainment of various costs, determine the final p1 ice
even after three years, and the finality in regard to cost
of development and amenities and the cost of
construction, referred under Clause 17, would not apply.
30. Whenever allotments are made even before the
completion of the development of land and
M. P. HOUSING & INFRASTRUCTURE DEV. BOARD v. 863
B. S. S. PARIHAR [V. GOPALA GOWDA, J.)
construction, necessarily the cost that is shown by the
A
authority or the Board will be tentative. In regard to the
land cost, there may be claims for enhancement of
compensation before the Reference Court with appeals
to the High Court and this Court. Sometimes the entire
process may take 10 to 15 years and till that process is
B
concluded the final cost of the land cannot be
determined. An allottee cannot therefore say that the
authority cannot increase the cost after 12 years.
32. Therefore, an allottee cannot contend that the
increase, if any, should be determined within three
years and if the increase is not so determined, the
tentative cost would itself become the final cost.