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              IN THE SUPREME COURT OF INDIA         Reportable CIVIL APPELLATE JURISDICTION  

CIVIL     APPEAL     NOS.4036-4040     OF     2007   

Bhubaneswar Development Authority & Anr. Appellants

Versus

Adikanda Biswal & Ors. Respondents

O     R     D     E     R   

1. The question that arises for reconsideration in these  

Appeals is whether the methodology adopted by  Bhubaneswar  

Development Authority (hereinafter shall be referred to as  

'BDA') in allotment of 45 plots situated within the city  

of Bhubaneswar to the citizens of Orissa on “First Come  

First Served” basis on out-right purchase, can be said to  

be just, proper and legally tenable method.  

2. Advertisements were issued by the Appellants on  

07.01.2000 in daily local newspapers published in Orissa  

namely, 'The Samay', 'The Samvad' and 'The Dharithri',  

having wide circulation, for allotment of plots, on the  

terms and conditions mentioned in it, which we shall deal  

with later.  

3. The advertisement shows that 45 plots were available  

for allotment on “First Come First Served” basis under the  

Scheme framed by BDA, having a plot size of 2400 sq.ft.

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(60' X 40') in Chandrasekharpur residential area at a cost  

of Rs.2.40 lakhs only that is at the rate of Rs.100/- per  

sq.ft. The advertisement further contemplates that the  

persons interested in out-right purchase would get  

priority in allotment of plot and they had to submit a  

bank draft drawn on Oriental Bank of Commerce, BDA Branch,  

Akash Sova Building, Bhubaneswar. It further contemplates  

that the Applications could be submitted on plain paper  

with the original Challan but general terms and conditions  

of allotment of plots, applicable to other schemes would  

be applicable to the present Scheme launched by BDA.  

4. Pursuant to the aforesaid advertisement, having been  

issued in the three daily local newspapers of Orissa as  

mentioned hereinabove, on 07.01.2000, 58 applicants  

deposited full amount together with application and other  

prescribed details on out-right purchase. Three applicants  

submitted their applications on 08.01.2000 and one each on  

10.01.2000 and 11.1.2000 along with a sum of Rs.2.40 lakhs  

each.  

5. The 'Prajatantra' newspaper had published a news-item  

under the heading 'BDA's Millennium Deceit'. The said  

publication indicates that it has criticised the manner  

and methodology under which the 45 plots were sought to be  

allotted to the applicants. It alleged that it was with an

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intention to benefit the pre-determinated and pre-decided  

close persons of BDA's officials. It further suggests that  

such an action of the BDA calls for high level inquiry  

into the matter.  

6. On account of the aforesaid news-item having been  

published in the 'Prajatantra' newspaper, a letter was  

addressed by the Secretary to the Lokpal of Orissa on  

15.01.2000 to the Vice Chairman, Bhubaneswar Development  

Authority. He wanted to have a copy of the original  

advertisement in respect of the plotted development scheme  

mentioned therein. He also wanted a copy of the earlier  

advertisement in respect of the core housing scheme at  

Jayadev Vihar square for the kind perusal of the Hon'ble  

Lokpal. This letter was issued after the initial  

discussions were held between the Secretary and Lokpal on  

earlier occasion. But nothing happened thereafter for a  

long time.  

7. On 16.05.2000, Secretary of the Department of Urban  

Development, Government of Orissa, gave a proposal to BDA  

to cancel the process of allotment of plots. The matter  

was placed before the BDA in its 76th Authority Meeting  

held on 16.05.2000. It was taken up as Item No.23/76.  

Various pros and cons of the same were discussed by the  

BDA on the said date. Thereafter, a conscious decision was

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taken by the BDA on the same day which reads as under :  

“Item     No.23/76     :     Allotment     of     left     over     plots     in    Niladri     Vihar,     Chandrasekharpur.   

The Committee decided that under the above  circumstances it is better to cancel the total  process and return the deposited money to all the  applicants with interest @4.5%. Fresh applications be  called for by re-advertising these plots @ Rs.100/-  per sq.ft. The applicants shall deposit EMD & balance  within 15 days of allotment. One month time shall be  given for receipt of application after which on  lottery basis allotment shall made.”  

8. This was also published in the newspaper 'The Samad'  

on 25.06.2000 so as to bring it to the notice of those  

applicants who had deposited their amount between  

07.01.2000 till 11.01.2000.  

9. Pursuant to the aforesaid Resolution, amounts  

received by BDA were returned to the applicants together  

with interest accrued thereon. We have been given to  

understand that some of them have accepted the amounts  

under protest, some of them have not accepted it and some  

of them have accepted it without any protest.  

10. On account of the cancellation of the total process  

of allotment of plots by BDA, it gave rise to filing of  

spate  of Writ Petitions by the Applicants, who had  

applied under the Advertisement issued by BDA, in the High  

Court of Orissa.  

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11. The said Writ Petitions came up for hearing before  

the Division Bench of the High Court. The same were  

disposed off by a common order on 31.1.2005. The Division  

Bench has allowed the Writ Petitions filed by the  

Respondents and directed the BDA to proceed further with  

regard to process of allotment of developed plots to those  

applicants who may fulfill other criteria as envisaged  

under the general conditions fixed by the BDA under its  

Scheme. It is against this judgment and order of the  

Division Bench of the High Court, BDA is in appeal before  

us.  

12. We have accordingly heard Mr. R. S. Jena, learned  

counsel along with other learned counsel appearing for  

Appellants and Mr. P.S. Narasimha, learned senior counsel  

and Mr. Arvind Verma, learned senior counsel with other  

learned counsel appearing for Respondents at length and  

perused the record.  

13. Shri R. S. Jena submitted that the High Court under  

Article 226 of the Constitution of India was not justified  

in interfering with the decision taken by the BDA to call  

for fresh applications for allotment of plots on lottery  

basis rather than proceeding with the allotment on the  

basis of “First Come First Served” basis.  Learned counsel  

submitted that there were sufficient reasons for taking

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such a decision which cannot be said to be arbitrary,  

illegal or vitiated by extraneous reasons. Learned counsel  

pointed out that the newspaper Prajatantra was  

highlighting the public perception that there was some  

foul play and favouritism in the proposed allotment of  

plots by way of “First Come First Served”  basis.  The  

Commissioner-cum-Secretary of H & UD Department had also  

suggested that the whole process be cancelled and the  

housing plots be auctioned.   Learned counsel also pointed  

out that the Lokpal had also proposed to initiate  

proceedings against BDA on the basis of news item appeared  

in Prajatantra.  Learned counsel submitted that taking  

into consideration all those aspects, the authority took a  

conscious decision to cancel the process of allotment by  

way of “First Come First Served” basis and to follow the  

system of allotment of plots by way of lots.  Learned  

counsel also submitted that there is no indefeasible right  

on the applicants to get allotment of plots and that  

authority has the right to adopt a system which is  

transparent and complaint free.  Learned counsel also made  

reference to a judgment of this Court in Shrijee Sales  

Corporation and Another v. Union of India - (1997) 3 SCC  

398 and submitted that the supervening public equity or  

public interest would override individual equity and in  

such a case a Court sitting under Article 226 of the  

Constitution of India is not justified in interfering with

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the decision of the authority, as if, it is sitting in  

appeal.  

14. Mr. P. S. Narasimha, learned senior counsel,  

submitted that the High Court was justified in quashing  

the decision taken by the authority in the absence of any  

material to show that the decision taken for allotment of  

plots following the “First Come First Served”  basis was  

vitiated by any extraneous or irrelevant considerations.  

No material has been produced before the Court to show  

that the applicants had come to know about the  

advertisement prior to 7.1.2000 or that any of the BDA  

officials was involved  in not keeping the secrecy of such  

advertisement.  Learned senior counsel, on the other hand,  

submitted that there were sufficient reasons to adopt the  

“First Come First Served”  basis since the allotment was  

for left over plots.   Learned senior counsel also  

submitted that the “First Come First Served”  basis for  

allotment of housing plots is not inherently bad and that  

BDA itself had adopted such a method in previous schemes.  

Learned senior counsel also submitted that the Lokpal had  

also not conducted any inquiry in respect of the news  

items appeared in the News Daily and, therefore, the  

decision of the authority dated 16.5.2000 cancelling the  

entire process of allotment was bad in law and the High  

Court was justified in setting aside that order.   Learned  

senior counsel also made reference to a judgment of this

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Court in Omkar Lal Bajaj v Union of India - (2003) 2 SCC  

673, in support of his contentions.   

15. We are of the view that the process of allotment of  

housing plots on “First Come First Served”  basis by a  

statutory authority has inherent dangerous implications  

and unless properly guarded, may lead to favouritism,  

partiality, arbitrariness etc.  So far as this case is  

concerned, the advertisement informing the public that the  

housing plots would be allotted on “First Come First  

Served”  basis appeared in three news papers on 7.1.2000  

and on the very same day 58 applicants had deposited the  

entire purchase price of Rs.2,40,000/- in the Oriental  

Bank of Commerce, BDA, Bhubaneswar and few others on  

subsequent days.   Later, a News Daily “Prajatantra”  on  

12.1.2000 published a news item,   the relevant portion of  

the same reads as follows:

“BDA  ’  S     MILLENNIUM     DECEIT   

.....Surprisingly this advertisement has not been  published in other widely circulated newspapers  and on the same 7th day after opening of the  office for a while acceptance of application form  was closed.   Is this millennium scheme not made  to make available residential plots to pre- determined and pre-decided close persons of BDA  officials?  There is a public demand for a high  level inquiry into this.”

16. The Secretary of the Office of the Lokpal, Orissa,  

taking note of the abovementioned news item as directed by

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the Lokpal called for the copy of the advertisement from  

the BDA, evidently  to examine whether such a course was  

adopted to make available the plots to pre-determined and  

pre-decided close persons of the officials of BDA.    

17. BDA taking note of the various complaints raised by  

the public through the newspaper as well as the initiation  

of proceedings by the Lokpal, placed the entire matter  

before the Authority as Item No.23/76 in the 76th Meeting  

held on 16.5.2000 in the Conference Hall of BDA,  

Bhubaneswar. The Commissioner-cum-Secretary, H & UD  

Department, had also suggested that the whole process  

should be cancelled and the housing plots be auctioned  

Taking into consideration all those aspects, the Committee  

on 16.5.2000 passed a resolution to invite fresh  

applications, and to follow the process of allotment,  by  

way of lots.  The Division Bench of the High Court,  

however, interfered with the decision taken by BDA and  

directed BDA to proceed with the advertisement dated  

7.1.2000 and to follow the method of “First Come First  

Served” basis.   

18. We are of the view that the High Court was not  

justified in sitting in appeal over the decision taken by

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the statutory authority under Article 226 of the  

Constitution of India.  It is trite law that the power of  

judicial review under Article 226 of the Constitution of  

India is not directed against the decision but is confined  

to the decision making process.   The judicial review is  

not an appeal from a decision, but a review of the manner  

in which the decision is made and the Court sits in  

judgment only on the correctness of the decision making  

process and not on the correctness of the decision itself.  

The Court confines itself to the question of legality and  

is concerned only with, whether the decision making  

authority exceeded its power, committed an error of law,  

committed a breach of the rules of natural justice,  

reached an unreasonable decision or abused its powers.    

19. We are of the view that there are sufficient  

materials before the statutory authority in cancelling the  

allotment of housing plots adopting the process of “First  

Come First Served” basis and to go in for allotment by way  

of lots.  Naturally, at least some of the officials of the  

BDA, were aware prior to 7.1.2000 that BDA was intending  

to follow the method of “First Come First Served”  basis.  

Further the advertisement dated 7.1.2000 indicated that  

BDA had only nominated one bank i.e. the Oriental Bank of  

Commerce, BDA, Bhubaneswar for depositing the money,  

evidently, at least some of the bank officials would also  

be aware prior to 7.1.2000, that the basis of allotment

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would be “First Come First Served”. Further, the  

advertisement was published in three newspapers on  

7.1.2000 and the publishers, the staff of those newspapers  

would also be aware that the BDA would be following the  

“First Come First Served”  basis for the allotment of  

plots.  BDA, therefore had not maintained secrecy which  

they were expected to maintain. It is under the above  

mentioned circumstances the BDA took a conscious decision  

on 16.5.2000 to cancel the earlier advertisement and to go  

in for allotment of housing plots by way of lots, which  

cannot be said to be arbitrary or illegal warranting  

interference by a court sitting under Article 226 of the  

Constitution.

20. The method of “First Come First Served” basis, as we  

have already indicated, has many inherent defects and if  

not properly taken care of, may lead to undesired results.  

21. In our considered opinion, there appears to be a  

fundamental flaw in adopting the principle of 'first come  

first served' inasmuch as it cannot be said to be free of  

arbitrariness and does not reflect transparency. It may be  

proved beneficial to those, who may be aware of such a  

procedure to be followed by B.D.A. in allotment of plots  

and may cause loss to those who may genuinely be  

interested in having a plot. We cannot put a seal of  

approval for such a method as the same is surrounded by

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many extraneous considerations. We have to keep in mind  

the larger public interest and institutional integrity  

cannot be allowed to be compromised.  

22. We are not taking the extreme stand that, in all  

situations the method of “First Come First Served” be not  

followed,  but sufficient safeguards have to be taken.  

For instance, the Haryana Urban Development Authority  

(HUDA), in the matter of allotment of industrial plots  

stated that the allotment of plots would be on ongoing  

“First Come First Served” basis with the following rider:

“As per provisions made in the Industrial Policy,  the industrial plots are to be allotted on "first  come first served basis on the analogy that all  applications received within a block of one month  shall be treated at par. However, submission of  application will not entitle an applicant for  allotment of industrial plot. The allotment shall  be made after due assessment of the project  report and the financial viability and usefulness  of the project and other merits of the applicant  as decided by the Committee constituted for the  purpose.”

23. The policy of allotment of plots on “First Come First  

Served”  basis was, therefore, on the analogy that  

applications received within a block of one month shall be  

treated at par.  This may make the process transparent and  

give little chance for favouritism.  

 24. We are of the view that BDA can adopt several methods  

for allotment of plots like, by way of lots, “First Come

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First Served”, auction etc., but the process should be  

transparent.   

25. We, are, however, of the view  that so far as the  

instant case is concerned, the decision taken by the  

authority to cancel the process of allotment by way of  

“First Come First Served”  basis cannot be said to be  

illegal, arbitrary or vitiated by extraneous reasons  

warranting interference under Article 226 of the  

Constitution of India.   

26. Learned counsel appearing on behalf of BDA submitted  

that though they had taken a decision on 16.5.2000 to call  

for fresh applications by re-advertising those plots at  

the rate of Rs.100 per sqft., they are free to allot the  

housing plots at the rate of Rs.1,378 per sq ft., as  

assessed by the Cost Assessment Committee considering the  

bench mark value furnished by the Sub-Registrar,  

Bhubaneswar, by way of lots.  We express no opinion on  

this aspect and leave it to the authority of BDA to act in  

accordance with law.  

27. Appeals are allowed and the impugned judgment of the  

High Court is set aside but there will be no orders as to  

costs.

................J [Deepak Verma]

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....................J [K. S. Radhakrishnan)

New Delhi;  February 01, 2012.

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ITEM NO.101               COURT NO.9             SECTION XIA [Revised]             S U P R E M E   C O U R T   O F   I N D I A                          RECORD OF PROCEEDINGS                     CIVIL APPEAL NO(s). 4036-4040 OF 2007

BHUBANESWAR DEVELOPMENT AUTHORITY & ANR.          Appellant (s)

                VERSUS

ADIKANDA BISWAL & ORS.                            Respondent(s)

(With appln(s) for vacating stay and Intervention/Impleadment)

Date: 01/02/2012  These Appeals were called on for hearing today.

CORAM :         HON'BLE MR. JUSTICE DEEPAK VERMA         HON'BLE MR. JUSTICE K.S. RADHAKRISHNAN

For Appellant(s)     Mr. Radha Shyam Jena,Adv.  Mr. Siddharth Panda, Adv.  

For Respondent(s)  Mr. P. S. Narasimha, Sr. Adv.   Mr. Arvind Verma, Sr. Adv.   Mr. S. Ghosh, Adv.   Mr. Vishnu Shankar Jain, Adv.   Mr. Shriram Parakkar, Adv.   Mr. Suresh Tripathy, Adv.  

 Mr. Merusagar Samantaray, Adv.   Ms. Aditi Mohan, Adv.  

                    Mr. Abhijit Sengupta,Adv.                      Ms. Kumud Lata Das ,Adv                      Mr. Dipak Kumar Jena ,Adv

Ms. Minakshi Ghosh Jena, Adv.   Mr. Sridhar Nayak, Adv.   Mr. Suvidutt Sundaram, Adv.   Mr. Rajesh Singh, Adv.  

          UPON hearing counsel the Court made the following                                O R D E R  

Application for impleadment is allowed.  

These Appeals are allowed in terms of the signed  

reportable order but there will be no orders as to costs.  

    (Sanjay Kumar-II)    Court Master

     (Veena Khera)          Court Master

[Signed Reportable Order is placed on the file]