ORDER
K. A. Swami, C.J.
1. All these appeals are preferred by the State Government against the common order dated 10th September, 1991 passed by the learned single Judge in Writ Petitions 2430, 3203, 5976, 17785, 18365, 18442, 18476, 18581, 18715, 18832, 18900, 18950, 19165, 19314, 19431,
19460 to 19462, 19598, 19599, 19647, 19715, 19720 and 19720 and 19870/90 6 to 8, 87, 248, 458, 750, 506, 507, 750, 1236/1448, 2325, 2326. and 3936 of 1991. Learned single Judge has allowed the writ petitions, quashed the order of the State Government dated 31-10-1989 bearing G.O.Ms. 1048, H. & U.D. Department, Government of Tamil Nadu and also quashed the individual orders passed by the Housing Board cancelling the allotment of plots made in favour of the writ petitioners. The direction or relief granted by the learned single Judge is as follows :–
“Following the order in Writ Petition No. 17793 of 1990, dated 9-9-1991 and also on the basis of the conclusion arrived at herein, the result will be that the impugned Government Order in G.O. Ms. 1048, Housing and Urban Development Department, dated 31-10-1989 is quashed, the consequential orders passed by the Tamil Nadu Housing Board cancelling the allotments of the all the petitioners, on various date will stand set aside. With regard to W. P. No. 18365 of 1991, since I have taken the view that the order of cancellation has to go, I think no order is necessary to consider the appeal of the petitioner herein, As such, the order of cancellation with regard to the petitioner therein alone is set aside. I make it clear that the quashing of Government Order in G.O. Ms. 1048, Housing and Urban Development Department dated 31-10-1989 is to the effect of setting aside the consequential order of cancellation of allotments by the Housing Board in all these cases. All the writ petitions will stand allowed. The respondent Housing Board is directed to abide by the terms and conditions in the agreement entered into between the Housing Board and each of the allottees with regard to the allotment orders made by them earlier. The petitioners are directed to approach the Board and pay the instalments, if already refunded. However there will be no order as to costs.”
Learned single Judge has allowed the writ petitions on two grounds, viz., that the allotment of plots made by the Housing Board was a contract outside the statute and that the State Government and the Housing
Board were estopped from taking any action”
for cancellation of the allotment, because
pursuant to the allotment, the petitioners had
paid the amounts as fixed under the orders of
allotment and also had obtained permission
and some of them had put up the construction
and some were to put up the construction and
as such, they had altered their position acting
upon the allotment orders, therefore, the
State Government and the Housing Board are
estopped from taking any action, which
would cause prejudice or injury to the
allottees, viz., the writ petitioners. Of course,
in the order under appeals, learned single
Judge has not dealt with the equitable rule of
promissory estoppel, but has referred to the
earlier order dated 9-9-1991 passed in Writ
Petition 17793 of 1990, considering the issue
of promissory estoppel.
2. In the light of the contentions urged on both sides, the following points arise for consideration :–
(i) Whether the allotments made to the petitioners were contracts outside the statute?
(ii) Whether in the facts and circumstances of the case, it was open to the State Government in exercise of its power under S. 155 of the Tamil Nadu State Housing Board Act, 1971 (hereinafter referred to as the Act) to issue a direction to the Housing Board to cancel the allotments of plots made in favour of the petitioners.
Point (i) :
3. It is not possible to agree with the reasoning of the learned single Judge that the allotments of plots to the writ petitioners were contracts outside the Statute. Whether a contract entered into by a statutory body is outside the statute or pursuant to the discharge of its functions as per the provisions of the statute, is to be decided with reference to the provisions contained in the Act governing the statutory body, in the instant case, the Housing Board. Therefore, it is necessary to refer to the relevant provisions contained in the Act. The Act itself came to be passed with an object of making a provision for the execution of housing and improvement schemes, for the establishment of a State
Housing Board and for certain other matters. The Housing Board is constituted as per the provisions contained in Chapter II of the Act. It is a body corporate and has perpetual succession and common seal. In addition to this, Chapter II provides for the constitution of the Housing Board. Chapter III deals with the assets and liabilities of the Housing Board and also abolishes the City Improvement Trust Board and transfers the assets and liabilities of the City Improvement Trust Board to the Housing Board. Chapter IV deals with the officers and staff members of the Board. The Board is the Appointing Authority for the post of Secretary, Housing Board Engineer, such other officers and servants as are considered necessary for the efficient performance of its functions. However, the appointments of Secretary and the Housing Board Engineer are subject to the previous approval of the State Government. Chapter V deals with the conduct of business of the Board and its Committees. Chapter VI deals with powers of Board and Chairman to incur expenditures on schemes and enter into contracts. Chapter VII deals with the housing or improvement schemes. As per the provisions contained in S. 35 of the Act, the Board is entitled from time to time to incur expenditure and undertake works for the framing and execution of such housing or improvement schemes as it may consider necessary. It is also open to the State Government to entrust execution of any housing or improvement schemes to the Housing Board, which is not provided for by the Act and thereupon, the Housing Board is required to undertake the execution of such work as if it had been provided for by the Act. Section 36 also empowers the State Government to transfer any land belonging to or vested in them or acquired under the Tamil Nadu Acquisition Act to the Board. Under S. 37, the Housing Board is empowered to frame a housing of improvement scheme on its own or at the instance of the State Government or a local authority. S. 38 empowers the Board to agree to frame and execute a housing or improvement scheme, at the instance of a local authority, if the Board is satisfied that such scheme is necessary and the funds at its disposal permit the framing and the execution
of such scheme or it may refuse to frame and execute such scheme, if it is satisfied that it is either unnecessary or not feasible or that it is otherwise unexecutable. S. 39 provides as to the steps which the Housing Board may take for the purpose of providing housing or improvement scheme. It also empowers the distribution or re-distribution of sites belonging to the owners of the property comprised in the scheme, sale, lease or exchange of any property comprised in the scheme, construction or alteration of roads, streets, back lanes, bridges, culverts and causeways and several other things as enumerated in Cls. (a) to (r) to S. 39. S. 40 provides for the types of housing or improvement schemes. Ss. 41 and 42 provide for housing accommodation scheme and rebuilding scheme, S. 43 provides for rehousing or rehabilitation scheme. S. 44 provides for city or town or village expansion scheme. S. 66 of the Act provides as to the measures to be taken by the Board. S. 72 specifically provides power to dispose of land, which reads thus :–
“72.(1) The Board may retain or may lease, sell, exchange or otherwise dispose of any land vested in or acquired by it under this Act.
(2) Whenever the Board decides to lease or sell any land acquired by it under this Act from any person, it-
(a) shall give notice by advertisement in one of the leading local newspapers in the State, and
(b) shall offer to the said person, or his heirs, executors or administrators, a prior right to take on lease or to purchase such land for an amount or at a rate to be fixed by the Board, if the Board considers that such an offer can be made without detriment to the carrying out of the purposes of this Act.
(3) If in any case two or more persons claim to have the prior right referred to in Cl. (b) of sub-sec. (2) preference shall be given to the person who agrees to pay the highest amount or rate for the land, not being less than the amount or rate fixed by the Board under that clause.”
Therefore, it is clear that the acquisition
of land, formation of house sites construction of houses, and allotment of the same to those persons who fulfil the conditions for allotment and also the execution of title deeds to the allottees are all done pursuant to the provisions contained in the Act and in discharge of the functions and duties entrusted to the Board. That being so, it is not possible to hold that allotment of a site and houses, execution of the document transferring the title to the allottee of the she or the house allottee, etc. are all contracts outside the statute. The several schemes provided under the Act for housing purposes are all undertaken by the Housing Board Pursuant to those provisions. Therefore, it is not possible to hold that allotment of sites to the writ petitioners is an act outside the contract. Consequently, it follows that whenever there is an illegality or infirmity in such proceedings including the allotment of sites or houses it would be open to the aggrieved persons to invoke ‘the jurisdiction of this Court under Art. 226 of the Constitution. However, learned single Judge has held that it is a non-statutory act. That being so, we reverse the said finding of the learned single Judge. Accordingly, point (i) is answered as follows :– The allotment proceedings culminating in the allotment and execution of the deed are all statutory functions and are not non-statutory.
Point (ii) :
4. Section 155 of the Act reads thus :–
“155(1). The Government may give the Board such directions as in their opinion are necessary or expedient for carrying out the purposes of this Act after giving an opportunity to the Board to state its objections, if any, to such directions and after considering the said objections and it shall thereupon be the duty of the Board to comply with such directions. (2) The Government may give any local authority such directions as in their opinion are necessary or expedient for enabling the Board to carry out the purposes of this Act, after giving an opportunity to the local authority concerned to state its objections, if any, to such directions and after considering the said objections and it shall
thereupon be the duty of the local authority to comply with such directions.”
There is no doubt that S. 155(1) empowers the State Government to give such directions to the Housing Board as it may consider necessary or expedient to carry out the purposes of the Act. Before any such direction is issued, an opportunity is required to be afforded to the Housing Board to state its objections, if any, to such directions and to take into consideration any objection filed by the Housing Board and the directions issued by the State Government on considering the objections of the Housing Board will be binding upon the Housing Board and it would be the duty of the Housing Board to comply with such directions. Sub-sec. (2) of S. 155 deals with the power of the State Government to give such directions as are considered necessary to a local authority in order to enable the Housing Board to carry out the purposes of the Act. We are now concerned with S. 155(1) of the Act which is very widely worded. It includes not only the directions of general nature, but also the directions that may a relate to individual cases. But, at the same time, it is not possible to hold that the power under S. 155(1) of the Act can be exercised by the State Government without due regard to the propriety, object of the Act and the rule of law. Whenever a statute empowers the high authority like the State Government to exercise the power without prescribing any parametres regarding exercise of the power, it is firstly expected of the State Government to exercise such power with due regard to the object and the provisions of the Act. Even otherwise, whenever such a power is conferred, the scope of it is determined with reference to the object of the Act and the context in which such power is conferred; in other words, in the absence of any specific parameter’s contained in the provisions empowering the State Government to exercise the power, those parameters are to found from the object of the Act and the other provisions contained therein. Therefore, tested in this background, the State Government cannot exercise the power under S. 155(1) arbitrarily without any basis and without due regard to the object, and the
provisions of the Act. If the direction which is proposed to be issued by the State Government to the Housing Board is such that it affects or interferes with the right and interest of a third party, it becomes necessary for the State Government to afford an opportunity to such third party to state the objections and to take into consideration of the same. Though there is no such express provision contained in S. 155(1) of the Act, but the same shall have to be read into it inasmuch as even in the exercise of the statutory power no order can be passed without affording an opportunity to the affected party to state its objection as long as the application of the principles of natural justice are not excluded by the express provisions contained in the Act. In the instant case, the direction issued to the Housing Board by the State Government no doubt states that after affording an opportunity to the allottees, the allotments be cancelled. The Housing Board is bound to carry out the direction and cancel the allotments. In such a situation, the opportunity to be afforded by the Housing Board to the allottees would be an empty formality because, there is no option left with the Housing Board as to cancel or not to cancel the allotment, as it is bound to cancell the allotment. Therefore, the State Government, whenever it issues such directions, it shall have to afford an opportunity to the party/ parties likely to be affected to putforth their objections and take into consideration of the same before issuing the directions. Thus on this ground alone the impugned order of the State Government is liable to be quashed.
4.1. In addition to this, in the instant cases, there is no doubt that when the lay out was formed by the Housing Board under the scheme formulated by it, the sites in question were reserved for several purposes reflecting public use. But, for a long time, those sites were not made use of for the purposes for which they were reserved. Therefore, the Housing Board on examining the actual state of affairs represented to the State Government through the letter of its Chairman bearing No. 12/49486/87, dated 31-7-1987 (the letter is in Tamil) that the sites mentioned therein are lying vacant for a long time, and
if they are allowed to remain vacant, there is likelihood of encroachment and as such, those sites may be converted for use as housing sites with the approval of M.M.D.A. and allotted to the persons. The said letter when translated into English reads as follows :
“The vacant plots/ sites shown in the sketch enclosed herewith are fallen vacant for many years. It is submitted for favourable orders with the opinion to make alternative allotment by converting the specified purpose into Housing Plots with a view to
(1) be utilised with immediate effect,
(2) to prevent the unauthorised encroach
ment/occupation, :
(3) to increase the revenue of the Board.
The site allotted for Social Welfare (47 C-1 to 47C-8) — It is submitted for orders to convert the said sites as Housing Plots with immediate effect, since they are vacant for more than 15 years.
The Plots under 15/1 to 15/4 are allotted for the purpose of construction of shops and even though a detailed report was submitted already for conversion of utilisation of land and recently there are many shops constructed by the private parties nearby and there ate many shops functioning, it is submitted for orders to allot as Housing Plots in the sketch of this site.
It is requested to pass an order for allotment of the following plots by obtaining the approval from M.M.D.A., to convert them as Housing Plots other than Plot Nos. 15/1 to 15/4. The sketch relating to these plots’is annexed herewith.
S.
No.
Scheme
Plot
No.
Purpose
shown in the sketch
Proposed
use
Extent
(1)
(2)
(3)
(4)
(5)
(6)
Gr.
Sq. ft.
1.
K.
K. Nagar
110
Shops
Housing
Plot
1-788
2.
K.K.
Nagar
11/1
Shops
-do-
0-2200
3.
-do-
112/2
-do-
-do-
1-0056
4.
-do-
116
-do-
-do-
1-469
5.
-do-
47/C1
Social
Welfare
-do-
1-660
6.
-do-
47/C2
-do-
-do-
1-1590
7.
:
-do-
47/C3
-do-
-do-
2-240
8.
-do-
11/1
Commercial
Purpose
-do-
0-969
9.
-do-
11/2
-do-
-do-
0-984
10.
-do-
11/3
-do-
-do-.
0-1000
11.
-do-
11/4
-do-
-do-
0-983
12.
-do-
11/5
-do-
-do-
0-988
13.
-do-
11/6
-do-
-do-
0-1013
14.
-do-
11/7
-do-
-do-
0-1031
15.
-do-
11/8
-do-
-do-
0-1050
16.
-do-
11/9
-do-
-do-
0-1065.
17.
-do-
11/10
-do-
-do-
0-1084
18.
-do-
11/11
-do-
-do-
0-1103
19.
-do-
11/12
-do-
-do-
0-1118
20
-do-
11/13
-do-
-do-
0-1133
21.
Ashok
Nagar
15/1
Housing
Plot
-do-
2-590-
22.
-do-
15/2
-do-
-do-
2-442
23.
-do-
15/3
-do-
-do-
2-600
24.
-do-
15/4
-do.
-do-
2-388
On the basis of the aforesaid letter, the State Government passed the order in G.O.Ms. 1707, dated 11-11-1987 in the following terms :–
“The Chairman, Tamil Nadu Housing Board has informed the Government that certain plots are available at K. K. Nagar for allotment by Government and requested that
the above plots may be allotted after obtaining the approval of Madras Metropolitan Development Authority,
2. The Government after careful consideration, allot the above plots to the
following individuals on hire purchase basis, subject to approval by MMDA and also subject to usual terms and conditions prescribed by Tamil Nadu Housing Board in its allotment rules.
Sl. No.
Name and Address
Plot No.
1.
Thiru V. Ramdoss, I.A.S., Managing Director, Tubewell Corporation, 19, Raja Street, Mandaveli, Madras-28
110
2.
Thiru T. Kumar, 57/ 1 Anna Street, Thiruvanmivur, Madras-41
116
3.
Thiru Francis Bastiyan, 1, Josier Street, Nungambakkam, Madras-34.
470/1
4.
Thiru V. Vijayaraghavan, Metropolitan Magistrate, 8-Vivekananda Road, Chetput, Madras-32
470/2
5.
Tmt. Meenakshi, w/o. Durai Govindarajan, 8-Kosan Block, Govt. Estate, Madras-99
470/3
6.
Tmt. Saramma Paul, Teacher, Don Bosco, Egmore, Madras-8
A.P.l1/1
7.
Thiru V. Veerichetty, Asst. Section Officer, Chief Minister’s Office, Madras-9 (in lieu of Plot No. 395 in Kottivakkam allotted in G.O.Ms. 1091, H. & U.D., Dt. 27-7-87)
A.P.1/2
8.
Thiru S. Ravichandran, 9, 1st Street, Surender Nagar, Adambakkam, Madras-88
A.P.11/3
9.
Thiru S. Venkatachalam, 172, Mowbrays Road, Madras-18.
A.P.11/4
10.
Thirumathi S. Thiresa, Teacher, Maynameyappan Higher Secondary School, College Road, Madras.
A.P.11/5
11.
Thiru S. Shanmugasundaram, District Registrar, Madras (Central) 71/7, Gandhi Street, Madras-35.
A.P.11/6
12.
Thiru M. Manickam, S/o. Senthil, 1/89, Perumal Koil Street, Ramapuram, Madras-89.
A.P.11/7
13.
Thiru T. M. Chidambaram Pillai4/2, Sathiya Nagar, Ramapuram, Madras-68.
A.P.11/8
14.
Thiru M. R. Shanmugam Venkateswar Sanitary Mart, 125-W, Block, Anna Nagar, Madras-40.
A.P.11/9
15.
Thiru C. Muthumani, S/o. Chinna Thambi, 5/1, Peter’s Colony, Madras-14.
A.P.11/ 10
16.
Thiru R. Margabhandhu, Managing Director, E.V.K. Sampath Maligai, College Road, Madras.
A.P.11/11
17.
Thiru G. Sekar, A-4/2, 3rd Lane, W.T.N. Road, Padi, Madras-50.
A.P.11/12
18.
Thiru G. Maruthaiyan, Plot No. 752, 59th Street, Sector-10, K. K. Nagar, Madras-78.
A.P.11/13
3. The Government plots also careful consideration allotted plot No. 395 at Kotti-vakkam to Thiru G. Victor Devasahayam, 42/3, C.P.W.D. Quarters, K. K. Nagar, Madras-78 on hire purchase basis subject to usual terms and conditions prescribed by Tamil Nadu Housing Board in its allotment rules.
4. The Chairman, Tamil Nadu Housing Board is requested to take action as ordered in paras 2 and 3 above.
(By Order of the Governor)
(Sd.) K. Srinivasan,
Deputy Secretary to Government.”
Similar orders were also passed in respect of the remaining plots. Pursuant to the aforesaid order, the Housing Board, it is not in dispute, obtained the approval from the Madras Metropolitan Development Authority and allotted the sites to the petitioners. Pursuant to the allotments, most of the petitioners have paid the amount, the other allottees have been paying the amount in instalments as per the terms of the order of allotments. Some of them have also put up the construction and others have not put up the construction and in the remaining sites, the constructions are on. When this was the position obtaining, it appears, the Chairman of the Housing Board and the Secretary of the Housing Board had addressed letters to the State Government mentioned in the preamble portion of the impugned order, G.O.Ms. 1048 dated 31-10-1989. On the basis of those letters, the State Government has passed the impugned order :–
”The Government have observed certain irregularities in the allotment of 242 plots
measuring a total extent of 302 grounds meant for public purposes like open space, shopping complex, market site, school sites, etc. by converting them into house sites, in the Tamil Nadu Housing Board Scheme areas in the Madras City. The Chairman and Managing Director, Tamil Nadu Housing Board, has therefore been directed to investigate the matter thoroughly and send a detailed report to Government. He has also been directed not to grant permission for construction by the allottees till the enquiry is completed and a decision is taken by Government in the matter.
2. The Chairman and Managing Director, Tamil Nadu Housing Board, has conducted an exhaustive investigation. He has also issued instructions to the Director Town and Country Planning, Corporation of Madras, Madras Metropolitan Development Authority not to issue NOC to the allottees for construction activities. During investigation, the Chairman and Managing Director, Tamil Nadu Housing Board, has identified three categories as indicated below :–
Category
Site Condition
Total No. of Plots
I
Vacant Plots without construction
112 Plots
II
Construction of building cither in the middle or in a portion
69 Plots
III
Built up of vacant within the category of residential such as sites for flats or adjacent to flats
61 Plots
The Chairman and Managing Director, Tamil Nadu Housing Board, suggested that the plots coming under Category-I which are vacant and could be put to original use, may be resumed as such, and the plots under Categories II and III may be permitted subject to eligibility.
3. The Government have examined the case carefully in the light of the report of the Chairman and Managing Director, Tamil Nadu Housing Board, the constructions that have taken place in some of the plots and the public interest involved cover these plots which were originally intended for park site,
community centre, shop site, school site, open space, etc. The sites under Category-II have also been inspected. The Government are of the view that the public cause for which these plots were originally earmarked, is more important rather than the individual interest, since the residence of the scheme area would be much affected for want of these facilities. The Government have therefore decided as follows :
i) In respect of Category-I, the Tamil Nadu Housing Board shall resume all the 112 (Hundred and Twelve) plots indicated in Annexure-I appended to this order straightway, after cancelling the allotments without issuing show cause notice and put them to original use.
ii) In respect of Category-11 indicated in Annexure-II appended to this order wherein 39 plots have been covered by construction and 30 plots are vacant, the Tamil Nadu Housing Board shall resume 27 (Twenty seven) vacant plots which can b’e put to original purpose, as identified during inspection and put them to the use accordingly or for any other public purpose which the Tamil Nadu Housing Board may think fit. In respect of 3 (three) vacant plots which cannot be put to original use and also the 39 (thirtynine) plots covered by construction, the Tamil Nadu Housing Board shall permit the allottees to retain the plots. Subject to their eligibility, ineligible cases shall be cancelled.
iii) In respect of Category-III, indicated in Annexure-III appended to this order, the Tamil Nadu Housing Board, shall permit the allottees to retain the plots subject to their eligibility. Ineligible cases shall be cancelled.
4. The Chairman and Managing Director, Tamil Nadu Housing Board is requested to take action as ordered in para 3 above immediately and send a report to Government on the action taken in due course. He is also requested to treat this matter as strictly confidential.
(By Order of the Governor)
C. Chellappan,
Secretary to Government.
Annexure-I (112) Plots
Scheme Area
Plot Numbers
Anna Nagar (17 Plots)
591-A, 591-A2, 591-A3, AP 2244, AP 2245, AP 2246, AP 2247, AP 2248, AP 2249, AP 2250, 2678-A, 2678-B, 884-A, 884-A2, 5042-Cl,5042-C2, 503-D.
1. A. A. Nagar (West) (44 Plots)
R-7/1, R-7/2, R-7/3, R-44/ 1, R-44/2, R44/3, 287-B, 287-A, 287-A, 287-C, 287-D, 287-E, 287-F, 287-G, 287-H, 287-K, 287-L, 287-M, 287-N, 287-P, 287-J, R-48A, R48B, R-48C, R-48D, R-48E, R-48F, R-48G, R-48K, R-48J, R-48K, R-48L, R-48M, R-48N, R-48P, R-48Q, R-48R, R-48S, R-48T, R-44C1, R-44C2, R-23A, R-23B, R-23C; R-23D.
M. K. B. Nagar (91 Plots)
1-A.
K; K. Nagar (28 Plots) ‘
11/2, 11/3, 11/4, 11/5, 11/6, 11/7, 11/8, 11/9, 11/10, 11/11, 11/12, 11/13, 110, 111/1, 111/2, 119/1, 119/2, 119/3, 44/1, 44/2 44/3, 44/4, 44/5, 44/6, 44/7, 47C/I, 47C/2, 47C/3.
Korattur (2 Plots)
445/A1.445-A2, 445-A3.
Basant Nagar (13 Plots)
16, 19, 612, 613, 614, 617, 618, 619, 620, 621, A6, A7, 537.
Ashok Nagar
13/1,13/2.
Nandanam SeetriammaColony (2 Plots)
1, 2.
Kotturpuram (2 Plots)
143/A, 143/B.
Annexure-II (69 Plots)
Vacant Plots
Scheme Area
to be resumed
to be permitted
Constructed plots to be permitted
Anna Nagar (37 Plots)
2678-A
2678-B
5149
5153
5158
3623-G7
3623-G9
3623-G10
3623-G12
3623-GI4
3623-G16
5147
5148
5154
5163
5152
3623-G11
3623-G13
3623-G15
2678C,1216A, 5150
5151,5154,5155
5157,5159,5160
5161,5162, C11/A2
C11/A1,
1775C, 5144
5145, 3623G-8, 5146
Anna Nagar (West) (3 Plots)
754-A
754-B, 754-C
Ashok Nagar (4 Plots)
12/2
14
15/1, 12/1
K. K. Nagar (9 Plots)
100/A2
100/A6
47F/1
100/A
347F/3
100/A4,100/A5
47F/2, 11/1
M.K.B. Nagar (3 Plots)
356A, 356B, 356C
Besant Nagar Phase-I (5 Plots)
17
20
14, 21 Market site (separate action is being taken and therefore orders will
be issued separately)
Indira Nagar (8 Plots)
L5
616, LI, L2, L3, L6, L7, M
Annexure-III (61 Plots)
Scheme Area
Plot Numbers
Anna Nagar (48 Plots)
1758,1759, AP 1257-A, 1132-A, 1132-B, 1132-C, AP 1084-A, AP 1079-A, AP 2264,
AP 2265, AP 965, AP 967, AP 968, AP 969, AP 970, AP 971, AP 996, AP 997,
AP 998, AP 999, AP 1000, AP 1002, AP 1003, AP 1004, AP 2242, AP 2243, AP
2251, AP 2252, AP 2253, AP 2254, AP 2255, AP 2256, AP 2257, AP 2258, AP
2259, AP 2260, AP 2261, AP 2262, AP 1010-A, AP 1395-B, AP 1385-C, AP
5107-AB, AP 2263, AP 966, AP 972, AP 1001, AP 2241, 995-JA.
Ashok Nagar (3 Plots)
15/2,15/3, 15/4.
Besant Nagar Phase (3 Plots)
10, 11, 12.
Thiruvanmiyur (5 Plots)
A1, A2, A3, A4, A5.
K. K. Nagar (2 Plots).
116, 20/82/2.
Pursuant to the aforesaid orders of the State Government, the Housing Board straightway-cancelled the allotment orders. The orders cancelling the allotments were challenged in a batch of Writ Petitions 14948 of 1990 and other connected writ petitions. A learned single Judge of this Court by a common order dated 29th January, 1990 quashed the orders cancelling the allotments and reserved liberty to the Housing Board to proceed in the matter on affording an opportunity to the allottees. The order reads thus :–
“It is, however, made clear that it will be open to the Housing Board to issue notices to each of the persons who according to the Housing Board, got allotment by irregular methods, calling upon them to show cause why the allotment should not be cancelled. The Housing Board shall give sufficient opportunity to those persons to make their representations and only after considering the said representations, final orders shall be passed by the Housing Board.
The cancellation orders are quashed only on the ground that there was no notice to the petitioners. This does not mean that the grounds raised by the petitioners as against the power of the Housing Board as well as the Government to cancel the allotments already made are concluded by the disposal of these writ petitions. All the contentions raised by the petitioners will be available to them if and when they are obliged to challenge any orders which may be passed by the Housing Board ultimately against them. Equally, it will be open to the Housing Board to sustain the orders passed by it on any ground open to it in law. In short, all the contentions raised by the petitioners and all the contentions available to the Housing Board are left open without being decided in any manner by this order.”
Thus the entire matter was left open including the contentions relating to the validity of the Government order. It is thereafter the Housing Board issued notices to the petitioners individually, considered the objections filed by them and passed the orders cancelling the allotments made in favour of the petitioners. It is not in dispute that the orders cancelling
the allotments are made pursuant to the directions contained in Government Order, G.O.Ms. 1048 dated 31-10-1989. As already pointed out, the Government Order dated 31-10-1989 did not allow any discretion to the Housing Board. Therefore, issuance of notices by the Housing Board calling for the objections from the allottees was only an empty formality as the Housing Board, pursuant to the Government Order, was bound to cancel the allotments. Therefore, in all these petitions, the petitioners have challenged the validity of the Government Order. It may be pointed out that in the earlier batch of writ petitions, the validity of the Government Order, G.O.Ms. 1048 dated 31-10-1989 was not challenged. Learned single Judge also did not go into the question, as it was not necessary at that stage, because the orders cancelling the allotments were made without affording an opportunity to the allottees-petitioners. Therefore, in these writ petitions, the validity of the Government Order dated 31-10-1989 is challenged. As already pointed out, the learned single Judge by the order under appeal has quashed the said order on the ground that the rule of promissory estoppel applied, therefore, the State Government is estopped from issuing a direction to cancel the allotments.
5. We are of the view that in a case like this, it is not even necessary to invoke the rule of promissory estoppel. The undisputed facts are that the State Government on an earlier occasion on examining all the facts relevant to the case, came to the conclusion that the sites in question which were not utilised for the purpose for which they were reserved should not be allowed to remain vacant for a long time as it would give scope for the encroachers to encroach upon, therefore, it was considered necessary and expedient to allot all these plots for construction of houses after obtaining the approval of the Madras Metropolitan Development Authority regarding the change in the use of the land. Accordingly, the Government passed an order in G.O.Ms. 1707 dated 11-11-1987. It is also not in dispute that pursuant to the aforesaid order, the Housing Board obtained the necessary approval from the M.M.D.A.
for coverting the sites in question into housing sites and allotted them to various petitioners. Pursuant to the allotments, the petitioners have been paying the amounts towards the allotments as per the terms of the allotments. They have also been put in possession of the plots and some of them have constructed the houses and some are yet to construct. In such a situation, it is not possible to hold that the exercise of power by the Government under S. 155(1) of the Act is cither proper or legal. It is also not possible to appreciate the conduct of the Housing Board again raking up the matter and addressing a letter to the State Government to cancel the allotments? Those letters of the Chairman of the Housing Board and the Secretary, Housing Board are referred to in the preamble portion of the impugned order, to which we have already adverted. That being so, we arc of the view that though the Government has got power to issue a direction as per S. 155(1) of the Act, in the facts and circumstances of the case and in the light of the interpretation placed by us on S. 155(1), it is not possible to hold that the power has been exercised by the State Government in accordance with law. It can only be termed as arbitrary exercise of the power. That being so, it cannot at all be sustained. If the power is exercised in such a manner, the interests of the citizens will not be safe. It is not the case of the State Government that the allottees have played any incredible or improper role for obtaining the allotment. In fact, the Housing Board and the State Government thought it necessary and ex-pendieni to have the sites converted into housing sites and allot them. If that be so, the subsequent act of the Housing Board in recommending for cancellation and the State Government in accepting such cancellation, cannot but be termed us arbitrary only. Accordingly, point (ii) is answered in the negative.
6. For the reasons stated by us and not for the reasons stated by the learned single Judge, we confirm the ultimate decision of the learned single Judge and dismiss these writ appeals. No order as to costs. The C.M.Ps. are also dismissed.
7. We make it clear that this judgment will not affect the authority of the Housing Board to take such action as is necessary in individual cases wherein the conditions of allotment have not been complied with. Liberty in this regard is reserved to the Housing Board. We also make it clear that such of those allottees who are not able to pay the amount towards the allotments as per the terms of the allotment orders — whether in part or in full, shall pay the entire amount due as on this day on or before the end of March 1995. On payment of the amount, the Housing Board shall complete the formalities, and convey the title, of course, subject to the right of the Housing Board to take such actions as are necessary, in the event any of the conditions of allotment is violated. Such of the allottees who have not yet complied with the conditions and such of those who could not comply with the conditions having regard to the cancellation of the allotment orders, will be entitled to have the period from the date of cancellation till this date (i.e. pendency of the writ petitions and writ appeals) excluded for complying with the conditions.
8. Appeals dismissed.