IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
C.W.P. No. 19587 of 2006
DATE OF DECISION: January 8, 2009
Harpreet Singh
...Petitioner
Versus
State of Punjab and others
...Respondents
CORAM: HON'BLE MR. JUSTICE M.M. KUMAR
HON'BLE MR. JUSTICE JORA SINGH
For the petitioner(s): Mr. V.K. Sharma, Advocate
Mr. Gurcharan Dass, Advocate
Mr. Sanjeev S. Thakur, Advocate
for Mr. Sanjiv Bansal, Advocate
Mr. Alok Jain, Advocate
For the respondent(s): Mr. Suvir Sehgal, Addl. AG, Punjab
Mr. B.S. Dhillon, AAG, Punjab
Mr. R.K. Sharma, Advocate
Mr. S.K. Sharma, Advocate
Brig. B.S. Taunque (Retd.), Advocate
Mr. Balwinder Singh, Advocate
Mr. K.S. Nalwa, Advocate
1. Whether Reporters of local papers may be Yes
allowed to see the judgment?
2. To be referred to the Reporters or not? Yes
3. Whether the judgment should be reported in Yes
the Digest?
M.M. KUMAR, J.
This order shall dispose of a bunch of ten petitions2
because common question of law has been raised therein, namely,
whether demand raised for payment of extension fee from the
petitioners is in accordance with the provisions of the Punjab
Regional and Town Planning and Development Act, 1995 (for
brevity, ‘the 1995 Act’) and the Punjab Regional and Town Planning
and Development (General) Rules, 1995 (for brevity, ‘the 1995
C.W.P. No. 19587 of 2006 2
Rules’). However, the facts are being referred from C.W.P. No.
19587 of 2006.
2. In this petition filed under Article 226 of the
Constitution, the petitioner has challenged show cause notice, dated
12.12.2006 (P-7), under Section 45(3) of the 1995 Act, issued by the
Estate Officer, Punjab Urban Planning and Development Authority,
Patiala-respondent No. 3 in respect of Plot No. 621, Phase-II, Urban
Estate, Patiala, raising the demand of extension fee for the period
from 27.3.1998 to 31.12.2006 on account of non-construction of
building. The petitioner has been directed to show cause within 30
days as to why order of resumption of plot and forfeiture of whole or
any part of the money paid be not passed under the provisions of
Section 5(4) [45(4)?] of the 1995 Act. A further prayer has been
made for directing the respondents to correctly demand the non-
construction fee as per the provisions of Rule 13 of the 1995 Rules.
3. Facts in brief are that Plot No. 621, Phase-II, Urban
Estate, Patiala, measuring 256.67 square yards, was allotted to the
petitioner, vide allotment letter dated 28.3.1995 (P-1). As per clause
9(ii) of the allotment letter the petitioner was required to construct the
entire permissible area on the ground floor within a period of three
years, first floor within a period of five years, second floor within a
period of seven years and rest of the area, if any, within ten years
from the date of allotment. Sub-clause (iii) of clause 9 further
stipulated payment of extension fee by the allottee in the event of
non-construction within the prescribed time limit, as per the schedule
given, which reads thus:-
C.W.P. No. 19587 of 2006 3
“EXTENSION FEE
i) For first year Rs. 3/- per sq. yd. on total plot
area
ii) For second year Rs. 4/- -do-
iii) For third year Rs. 5/- -do-
iv) For fourth year Rs. 9/- -do- v) For fifth year Rs. 11/- -do- vi) For sixth year Rs. 14/- -do- vii) For seventh year Rs. 16/- -do-"4. The petitioner has claimed that the Urban Estate Patiala
is a low lying area and it is not safe for human habitation, being
subjected to fury of floods repeatedly. It has been alleged that no
arrangements have been made by the respondents for preventing the
threat to the life and property of the residents of Urban Estate, Patiala,
on that count. It is only in the recent past that some efforts were
made to protect the Urban Estate by laying down 4 ft. diameter
pipeline connecting the Urban Estate, Patiala, with Patiala Nadi for
lifting the water there. Besides this, a small bridge over Sirhind
Bypass has also been constructed for allowing free flow of rainwater
towards the Patiala Nadi. It has been further alleged that the Patiala
is affected by floods almost every year due to the fact that this area
falls at the bank of Badi Nadi and falls under the catchment area. To
support this assertion, the petitioner has annexed a news item (P-2).
The inhabitants of the area witnessed the worst floods in the years
1988 and 1989 in which many people lost their lives in the
devastating floods and property worth crores of rupees was destroyed.
C.W.P. No. 19587 of 2006 45. The petitioner could not complete the construction over
the plot within the stipulated period. Accordingly, a notice dated
30.7.2006 was sent to him raising a demand of Rs. 1,02,775/- on
account of non-construction fee up to 31.12.1995. In case of non-
payment, the plot was to be forfeited under the provisions of the 1995
Act. Feeling aggrieved, the petitioner filed C.W.P. No. 10679 of
2006 in this Court, which was allowed on 18.7.2006. While quashing
the demand notice this Court granted liberty to the respondent Estate
Officer to raise a fresh demand in accordance with law and by
following the principles of natural justice i.e. by serving a show cause
notice at the first instance and considering reply thereof (P-3).
6. Again a show cause notice dated 19.9.2006 was issued to
the petitioner raising a demand of Rs. 1,32,958/- on account of
extension fee (non-construction fee) up to December 2006. The
petitioner was required to give an undertaking on a stamp paper worth
Rs. 15/- duly attested by the first Class Judicial Magistrate, failing
which action for resumption of the plot under Section 45(3) of the
1995 Act was to be initiated (P-4). On 17.11.2006, the petitioner
submitted a detailed reply to the show cause notice requesting the
respondents to raise the demand in accordance with the provisions of
the 1995 Act and the 1995 Rules (P-5).
7. Against notice dated 19.9.2006, the petitioner filed the
instant petition. On 11.12.2006, the extension fee claimed from the
petitioner was stayed by this Court. Thereafter, the respondents
withdrew notice dated 19.9.2006 and issued a fresh notice dated
12.12.2006 (P-7) under Section 45(3) of the 1995 Act claiming
C.W.P. No. 19587 of 2006 5enhanced fee in terms of policy dated 15.1.1998 requiring the
petitioner to show cause as to why the plot allotted to him be not
resumed under Section 45(4) of the Act. The petitioner has filed a
detailed reply dated 28.12.2006 (P-8) to the show cause notice dated
12.12.2006. In view of issuance of fresh show cause notice dated
12.12.2006, the petitioner has also amended the writ petition enabling
him to challenge the same.
8. In the written statement filed by respondent Nos. 2 and 3
the stand taken is that the instant petition is wholly pre-mature
because the reply dated 28.12.2006 (P-8) to the notice to show cause
dated 12.12.2006 (P-7) is under consideration. It is appropriate to
mention that the notice to show cause has been given under Section
45(4) of the 1995 Act, which envisages resumption of the plot
allotted to the petitioner. The respondents have further pointed out
that there is alternative remedy available as per clause 18 of the
allotment letter. It has also been alleged that material facts have been
concealed by pleading that the area in question is low lying and if the
petitioner was not satisfied with the location of the Urban Estate,
Patiala, then he could have refused to accept the allotment of plot in
the year 1995 itself. The respondents have also placed reliance on
Rule 13 of the 1995 Rules, which envisaged that after the expiry of
period of three years given under the allotment letter further
extension for construction could only be granted up to five years. It
also provide for extension for construction only up to a period of five
years. Further extension beyond eight years period is not permissible
unless some extra ordinary reasons are cited, which is subject to
C.W.P. No. 19587 of 2006 6undertaking concerning payment of compromise fee. The petitioner
has not sought any extension in construction period from 28.3.1998
nor has deposited the amount of extension fee. Therefore, in the case
of this plot the period expired on 28.3.2003 and under the 1995 Rules
no extension for construction of building could be granted.
9. Learned counsel for the petitioner(s) have argued that
exorbitant rates are being charged for extension fee, which is against
condition Nos. 9 and 14 of the letter of allotment. They have further
submitted that vide Memo. dated 29.1.1988, the rates of extension fee
have been notified by the Government and the extension fee sought to
be demanded from the petitioner is exorbitant. Learned counsel also
drawn our attention to Rule 13 of the 1995 Rules which again make
provision for extension fee, which is far less than the rates quoted by
the respondents. It has been submitted that the case of the petitioner
is squarely covered by a Division Bench judgment of this Court
rendered in the case of Tehal Singh v. State of Punjab and others
(CWP No. 13648 of 1998, decided on 4.5.1999, Annexure P-9).
10. Learned counsel for the respondents have jointly argued
that the petitioner is not entitled to invoke the extra ordinary writ
jurisdiction of this Court under Article 226 of the Constitution
without first exhausting the departmental remedy as per clause 18 of
the allotment letter. According to the leaned counsel the petitioner
must approach the Chief Administrator, PUDA. They have further
argued that according to Rule 13 of the 1995 Rules the maximum
period of extension has already expired and the petitioner cannot
claim the same as a matter of right.
C.W.P. No. 19587 of 2006 7
11. We have thoughtfully considered the submissions made
by the learned counsel for the parties and are of the view that the writ
petition deserves to be allowed. It has come on record that the
allotment of plot made to the petitioner was to be governed by the
provisions of the Punjab Housing Development Board Act, 1972 (for
brevity, ‘the 1972 Act’). According to Section 58 of the 1972 Act,
the Punjab Housing Development Board was empowered to retain
lease, sell, exchange or otherwise dispose of any land, building or
other property vested in it, which was subject to any rules made by
the State Government. The State Government had issued policy
guidelines from time to time for granting extension of time for raising
construction on plots after charging extension fee. On 29.1.1988
such a policy was issued on which reliance has been placed by the
learned counsel for the petitioner. The policy was circulated, which
contained the revised guidelines regarding extension of time limit for
raising construction subject to payment of extension fee at the
following rates:-
“1.(a) Residential Plot
In case of residential plots, the extension in the period of
construction of the building on the plot, after expiry of
three years from the date of allotment, shall be allowed
on payment of a fee at the following rates:
1st year of extension Rs. 1.50 per sq. mtr.
2nd year of extension Rs. 2.00 per sq. mt.
3rd year of extension Rs. 2.50 per sq. mt.
4th year of extension Rs. 4.50 per sq. mt.
C.W.P. No. 19587 of 2006 8
5th year of extension Rs. 6.00 per sq. mt.
Extension beyond the period of three years shall not be
ordinarily granted. Failure to obtain the extension on
payment of prescribed fee or failure to raise construction
in the prescribed or the extended period shall make the
allotment liable for cancellation for violation of terms
and conditions of allotment as provided in the Act and
the Rules.
b) For commercial Plots:- The extension in the
period for raising construction on commercial plots shall
be permitted on the pattern/terms and conditions as
applicable in case of residential plots but extension fee in
these cases shall be as under:
(i) For single storey 2 times the rates building, double applicable in case of storey or one residential plots. storey and one basement buildings. (ii) For more than two 3 times the rates storey buildings applicable in case of residential plots."12. The State of Punjab enacted a comprehensive legislation
in the year 1995 to regulate the regional and town planning and
development of urban estates. The Division Bench judgment in Tehal
Singh’s case (supra) examined Section 2(zc), 43, 148, 180 and 183 of
the 1995 Act and noticed that the Punjab Urban Development
C.W.P. No. 19587 of 2006 9Authority (PUDA) was established by the State of Punjab by issuing
notification dated 30.6.1995 by abolishing the Punjab Housing
Development Board. The analysis made by the Division Bench of the
aforementioned sections is evident from the following para:-
” An analysis of the provisions extracted above
shows that the disposal of land acquired by the P.U.D.A.
or transferred to it by the State Government is regulated
by Section 43 of the 1995 Act. Sub-section (1) thereof
empowers the P.U.D.A. to dispose of any land with or
without undertaking or carrying out any development
thereon. Sub Section (2) declares that the transfer of any
land to any person under sub section (1) shall be subject
to such further conditions as may be prescribed with
regard to completion of buildings or part thereof with
regard to extension of period for such completion and
payment of fees for such extension. Sub-section (4) of
Section 43 declares that subject to the provisions of sub-
sections (1) to (3), the P.U.D.A. may sell, lease or
otherwise transfer whether by auction, allotment or
otherwise any land or building belonging to it on such
terms and conditions as it may determine from time to
time. The word “prescribed” which is defined in Section
2(zc) means prescribed by rules made under the Act.
Section 180 confers power upon the State Government to
make rules for carrying out the purpose of the Act.
Clause (i) of sub-section (2) of section 180 empowers the
C.W.P. No. 19587 of 2006 10State Government to make rule regulating the conditions
regarding period of completion of building, extension of
such period and fee to be paid under sub-section 92) of
Section 43. ……”
13. The State Government framed the 1995 Rules in
pursuance of power vested in it by Section 180 of the 1995 Act. Rule
13 of the 1995 Rules specify the time within which the building is to
be completed and also provides for grant of extension for the time
limit subject to payment of fee. Rule 13 has been noticed by the
Division Bench in detail alongwith various other Sections of the 1995
Act. The analysis of the Division Bench is evident from the
following para:-
” A conjoint reading of the various provisions of the
1995 Act and the 1995 Rules shows that the transfer of
land under sub-section (1) of Section 43 is not only
subject to the directions which may be given by the State
Government under the 1995 Act but also the conditions
which may be prescribed with regard to completion of
building or part thereof and with regard to extension of
period for such completion and payment of fee for such
extension. A perusal of Rule 13 of the 1995 rules along
with Section 180(2)(i) and Section 2(zc) of the 1995 Act
shows that the time within which the building is to be
completed and other related matters are governed by the
1995 Rules. Therefore, with the coming into force of
these rules, the rates of extension fee prescribed by the
C.W.P. No. 19587 of 2006 11Board stood superseded and in terms of sub rule (2) of
rule 13 of the 1995 rules, the petitioners became eligible
to seek extension of the specific time limit subject to
payment of the fee prescribed under sub-rule (3) of Rule
13.”
14. The Division Bench accepted the argument similar to the
one raised by the petitioner. The Division Bench held that the
extension fee has to be charged in accordance with the provisions of
Rule 13 of the 1995 Rules enacted by the State Government under
Section 180(2)(i) of the 1995 Act and with the enactment of the 1995
Act and the 1995 Rules, the PUDA and its functionaries cannot
demand enhanced extension fee from the petitioner. It went on to
hold that the notices issued to the petitioners for payment of
extension fee were ultra vires of the provisions of the 1995 Act and
the 1995 Rules. It would be apposite to read Rule 13 of the 1995
Rules, which is as under:-
“13. Time within which building is to be completed
[Sections 45(2) and 180(2)(i)]
(1) The transferee shall complete the building
within three years from the date of issue of allotment
order or the date of auction, as the case may be, in
accordance with these rules.
(2) The time limit specified in sub-rule (1) may
be extended by the Estate Officer in the manner and on
payment of fee specified hereinafter if he is satisfied that
the failure to complete the building within the said
C.W.P. No. 19587 of 2006 12period was due to a cause beyond the control of the
transferee.
(3) Extension in time limit in terms of the
provisions of sub-rule (2) may be granted by the Estate
Officer for a period not exceeding five years on the
payment of fee at the following rates, namely:
(a) In the case of residential plots as under:
Period of extension Rate of fee per square meter (i) First year Rs. 1.50 (ii) Second year Rs. 2.00 (iii) Third year Rs. 2.50 (iv) Fourth year Rs. 4.50 (v) Fifth year Rs. 6.00 (b) In the case of commercial plots as under: Period of extension Rate of fee (i) First year One percent of the sale price (ii) Second year One and half per cent of the sale price (iii) Third year Two per cent of the sale price (iv) Fourth year Two and a half per cent of the sale price (v) Fifth year Three per cent of the sale price (4) For the purpose of sub-rule (5) extension intime shall be given for a calendar year that is for the
period commencing from the 1st January and ending with
the 31st December:
C.W.P. No. 19587 of 2006 13
Provided that if the period of three years following
the date of allotment of auction expires.
(i) after the 30th June of a given year or if the
period of extension commences from any date after the
30th June, the period of three years shall automatically
stand extended upto the 31st December of that year and
no fee for the period will be chargeable: and
(ii) during the period following between the 1st
January and 30th June of a given year fee at half the rate
specified in sub-rule (3) shall be payable for that year.
(5) For removal of doubts it is hereby declared
that fee prescribed under the rule shall be payable
irrespective of the fact whether the plot holder applies or
does not apply for extension under this rule.”
15. When the facts of the present case are examined in the
light of the principle laid down by the Division Bench judgment in
Tehal Singh’s case (supra), we are left with no doubt that the show
cause notices issued to the petitioner on 19.9.2006 (P-4) and
12.12.2006 (P-7) requiring him to pay extension fee of Rs. 1,32,958/-
was violative of the provisions of the 1995 Act and Rule 13 of the
1995 Rules, as has already been noticed in the preceding paras. The
controversy, in fact, stand settled by the Division Bench judgment in
Tehal Singh’s case (supra) and the issue does not deserve to be re-
opened. The respondents have failed to consider the reply filed by
the petitioner wherein judgment rendered by the Division Bench in
C.W.P. No. 19587 of 2006 14
Tehal Singh’s case (supra) has been cited and the charging of
extension fee at exorbitant rate has been duly answered.
16. In view of above, the writ petition succeed. The
impugned notice dated 12.12.2006 (P-7) is hereby quashed. The
respondents are directed to calculate the extension fee as per Rule 13
of the 1995 Rules. The needful shall be done within a period of two
months from the date of receipt of a certified copy of this order. The
petitioner shall pay the extension fee within a period of two months
from the date of receipt of the calculation given in the fresh notice to
be issued by the respondents. The petitioner shall further be entitled
to consequential benefit to get the site plans approved. The petitioner
is also held entitled to his costs.
17. The other connected writ petitions are also disposed of in
the above terms. It is, however, clarified that in cases such as C.W.P.
Nos. 8864 and 13765 of 2007, where the petitioners have already paid
the extension fee as per the rates demanded by the respondents, which
are exorbitant and against the Division Bench judgment of this Court
in Tehal Singh’s case, the respondents are directed to re-calculate the
amount of extension fee as per the provisions of Rule 13 of the Rules
and refund the over-payment alongwith interest @ 10% per annum.
The needful shall be done within a period of two months from the
date of receipt of a certified copy of the order.
(M.M. KUMAR)
JUDGE
C.W.P. No. 19587 of 2006 15
(JORA SINGH)
January 8, 2009 JUDGE
Pkapoor
2
1.CWP No. 19587 of 2006Harpreet Singh v. State of Punjab and others2.CWP No. 657 of
2007Gurvinder Kaur v. State of Punjab and others3.CWP No. 8864 of 2007Dhanjit
Singh Sandhu v. State of Punjab and others4.CWP No. 13765 of 2007Rajan Gupta v.
Punjab Urban Planning and Development Authority and another5.CWP No. 18984 of
2007Sanjay Gupta v. State of Punjab and others6.CWP No. 19449 of 2007Rita Gupta v.
State of Punjab and others7.CWP No. 11785 of 2008Sandeep Gupta v. State of Punjab
and others8.CWP No. 11788 of 2008Tersem Lal Jindal v. State of Punjab and
others9.CWP No. 11789 of 2008Santosh Kumari v. State of Punjab and others10.CWP
No. 15617 of 2008Ved Parkash Garg v. State of Punjab and others