Reportable  IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 1 OF 2011 [Arising out of SLP (C) No. 24629/2009]

Brij Mohan & Ors. … Appellants

Vs.

Haryana Urban Development Authority & Anr. … Respondents

J U D G M E N T

R.V.RAVEENDRAN, J.

Leave granted.

2. The first respondent Haryana Urban Development Authority (for short  

HUDA) formulated a Scheme vide Circular dated 10.9.1987 (as clarified by  

circular  dated  9.5.1990)  for  allotment  of  plots  to  land  losers/oustees  at  

normal allotment rates. The said scheme inter alia provides for allotment of a  

plot measuring 250 sq. yd. to a landowner whose acquired land measures  

between 500 sq.  yd.  to  one acre.  It  also provides  that  where there  are  a  

number of owners in respect of an acquired land, efforts should be made to  

accommodate each of them subject to a limit of one plot of 250 sq. yd., for  

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every acre of land acquired. It requires that “claims of the oustees shall be  

invited before the sector is floated for sale”. A revised policy/scheme was  

introduced by HUDA by circular dated 18.3.1992 which inter alia provided  

as follows :

“(vi) Allotment of plots to the oustees will be made at the allotment rates  advertised by the Haryana Urban Development Authority for that sector  Land-owners will be given compensation for their land which is acquired.

(vii) Claims of the oustees for allotment of plots under this policy shall be  invited  by  the  Estate  officer,  Haryana  Urban  development  Authority  concerned before the sector is floated for sale.”

3. The appellants 1 to 6 were the owners of 38 bighas and 3 biswas of  

land  in  Hudbust  No.1,  Kasba  Karnal.  Their  lands  were  acquired  for  

development and utilization of land as residential and commercial area of  

Karnal  under  a  preliminary notification issued in 1989 followed by final  

notification issued in the year 1990. On making the award, possession was  

taken  on  19.12.1990.  The  appellants  made  an  application  to  HUDA  for  

allotment of plots under the aforesaid oustees policy on 28.12.1990.  

4. HUDA developed a layout (Sector-4 Part-II) for the benefit of general  

public in the acquired lands and offered the residential plots in that sector for  

allotment at the rate of Rs.1032/- per sq. m. (Rs.863/- per sq. yd.) for 300 sq.  

mtr. plots and Rs.1135/- per sq. m. for 420 sq.m. plots. As the appellants  

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were  not  allotted  plots,  they  filed  a  writ  petition  (CWP  No.2596/1992)  

seeking a direction to HUDA to allot to each of them a plot measuring 250  

sq.yd. in Sector 4 or 5 which were being developed by the respondents, at  

cost on “no profit no loss basis”. The said writ petition was disposed of by  

order dated 29.7.1992 recording the statement of the respondents that the  

case  of  the  appellants  was  under  consideration  and they  will  be  allotted  

plots, with a direction to the respondent to decide the matter expeditiously  

preferably  within  six  months.  As  the  order  dated  29.7.1992  was  not  

complied  with,  the  appellants  filed  a  contempt  petition  (COCP  

No.240/1993).  Only  thereafter,  the  second  respondent  (Estate  Officer,  

HUDA) sent letters of allotment dated 13.9.1993 to each of the appellants  

allotting a plot measuring 209 sq.m. (250 sq.yd.) at a cost of Rs.280,478/-  

which works out to Rs.1342/- per sq.m. (Rs.1122/- per sq.yd.). In view of  

the said allotments, the contempt petitions were disposed of recording the  

submission that all the appellants have been allotted plots.  

5. The  appellants  again  approached  the  High  Court  by  filing  a  writ  

petition  (CWP No.12240/1993)  contending  that  the  allotments  should  be  

made at cost plus development charges basis and not at market price. The  

appellants  also sought quashing of the demand for payment of a price of  

Rs.280,478/-  for  each  of  the  plots  allotted  to  the  appellants.   A learned  

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Single Judge of the High Court by order dated 10.11.2008 dismissed the writ  

petition on the ground that  the matter  was governed by the policy dated  

10.9.1987; that under that policy, the oustees - allottees were liable to pay  

the normal allotment rate, which meant the prevailing rate that was being  

charged  from any  ordinary  allottee  to  whom plots  were  allotted  in  that  

sector;  and that as the allotment rates charged to the appellants  were the  

same as the allotment  rates  charged to  other  alltotees,  there  was nothing  

irregular or illegal in the demand for payment of Rs.280,474/-  as cost of  

each plot.  

6. Feeling  aggrieved,  the  appellants  filed  an  appeal  (Letters  Patent  

Appeal  No.220/2009)  contending  that  having  regard  to  the  terms  of  the  

Scheme, even if the allotment rate had to be paid, that should have been at  

Rs.863/-  per  sq.yd.  which  was  the  rate  of  allotment  under  the  HUDA  

Advertisement dated 9.9.1991. They also contended that HUDA deliberately  

delayed the allotment of plots to appellants and then charged them a higher  

allotment rate which came into effect subsequently. A Division Bench of the  

High Court by impugned judgment dated 20.5.2009 dismissed the appeal.  

The said judgment is challenged in this appeal by special leave.  

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7. There is  no doubt  that  the  appellants  were entitled to allotment  of  

plots. In fact, each of them has been allotted a plots (that is plots bearing  

Nos.63, 62, 61, 64, 54 and 53 in sector No.4, Part-II), each measuring 209  

sq.m. or 250 sq.yd. The only issue that arises for consideration in this appeal  

is  about  the  rate  to  be  charged  in  regard  to  such  allotment.  On  the  

contentions urged the following questions arise for our consideration :

(i) Whether  HUDA  should  charge  only  the  actual  land  cost  plus  development charges for the plots allotted to oustees/land losers, and not the  market price/normal allotment price?

(ii) What is the meaning of the words ‘normal allotment rate’ used in the  scheme for allotment to oustees?

Re : Question (i)

8. It  is  submitted  by  the  appellants  that  the  Scheme for  allotment  of  

developed plots was made recognizing the fact that the oustees lose their  

lands, and many of them also lose their place of residence. The appellants  

therefore contend that the oustees/land losers whose lands were acquired and  

who claimed allotment of plots under the HUDA’s Scheme for allotment of  

plots  to  oustees,  stand  on  a  different  footing  when  compared  to  normal  

applicants for allotment. They relied upon the observations of this Court in  

Hansraj H. Jain v. State of Maharashtra [1993 (3) SCC 634] in support of  

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their contentions that the allotments to land losers should be at cost of land  

plus development charges. In that case the government of Maharashtra had  

evolved a policy to offer alternative plots/sites to affected land owners. The  

policy did not however contain any specific provision relating to price to be  

charged. This Court noticed the following arguments addressed on behalf of  

the State and the land losers :

“On the question of price of the alternative site, the learned Solicitor has  submitted  that  after  acquisition  the  lands  in  New  Bombay  have  been  vested in CIDCO for development and disposal. All the costs incurred on  the  development  are  to  be  met  by  disposing  the  saleable  land.  In  the  process, the Corporation has to spend huge amounts on development of  infrastructure  in  the  form of  roads,  water  supply,  sewerage,  electricity,  transport etc. For the purpose of disposal of saleable land, certain lands are  required to be provided to the social institutions, project affected persons,  economically  weaker  sections  and lower income group at  nominal  and  subsidized rate and the shortfall accruing from such subsidized disposal  has to be recovered by the sale of other lands. The commercial areas are  sold  by  the  Corporation  by  tender  system and  such  areas  draw  much  higher  rate.  The  learned  Solicitor  has  submitted  before  us  that  unfortunately the ratio of such disposal at higher rate in the entire process  is  around  1%  only.  He  has,  however,  submitted  that  the  concerned  authorities are keen to give relief to the affected land owners by charging  reasonable  price  as  far  as  practicable.  The  learned  counsel  for  the  appellants have, however, submitted that although the award for acquiring  land was made at rs.4 per sq. mtr., the developed lands for alternative sites  for building houses for the affected land owners are being offered @ Rs.  13,200 per sq. mtr.”

This Court on considering the contentions, held that on the special facts and  

circumstances, allotments should be made to the land losers by charging the  

cost  of  acquisition  plus  actual  cost  of  development.  The  relevant  

observations are extracted below :  

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“We, therefore, direct the concerned authorities to offer the alternative site  as per the scheme framed in 1976 referred to hereinbefore to the affected  land owners on the basis of the actual cost of development by charging the  cost of the acquisition and the development charges and no more. Such  direction, we feel, is required to be made particularly  in view of the fact   that acquisition proceedings had been pending for a number of years, as a   result  of  which  the  amount  of  compensation  for  the  acquisition  being   referable  to  the  period  when  notices  under  Section  4  of  the  Land   Acquisition  Act  were issued,  became insignificant  and it  is  reasonably   apprehended that unless the land by way of alternative site as per the   scheme is  offered  to  the  affected  land owners  at  a  subsidized  rate  as   indicated hereinbefore, it will not be possible for the land owners to take   such allotment by paying usual prices intended to be changed from them  and the offer of alternative site will for all practical purposes be illusory.”

(emphasis supplied)       

9. Placing strong reliance on the said observations in  Hansraj H. Jain,  

the appellants contended that the price of plots allotted was almost as much  

as the compensation that was given to them for the entire  acquired area.  

According to them, an extent of 3836 sq. yds. of land was acquired from  

each of appellants 1 to 5 and the compensation awarded to each of them was  

Rs.302,473/- (slightly more was acquired from sixth appellant). As against  

it, each was required to pay Rs.280,478/- for a plot of 250 sq.yds which was  

almost  the  entire  compensation  they  got.  They  submitted  that  the  

compensation awarded for the acquired land (of about an acre) was less than  

the price that was demanded by HUDA for each plot that was allotted to  

them; and that if the compensation paid to a land loser for an acre of land  

(less legal and other expenses) would be insufficient to buy even a small  

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plot, let alone construct a house therein, even a scheme for allotment will  

only be a mirage for most of the small land holders. They also submitted that  

as  the  allotment  of  a plot  is  a  part  of  the  resettlement  and rehabilitation  

package given to the land losers, as an incentive to accept the acquisition  

without  protest  and co-operate  with  the  State  Government,  the  allotment  

should be at a realistically reasonable cost, that is actual cost of land plus  

development charges.  

10. No doubt, the contention that allotment of  plots to land losers should  

be at actual cost (acquisition cost of land plus development cost), appears to  

be reasonable and attractive. That should be the ultimate goal in a changing  

scenario favouring acquisitions which are land loser-friendly. The arguments  

of the appellants do certainly make out a case for such a scheme to create a  

better settlement and rehabilitation policy in regard to land acquisitions. If  

there was any statutory  provision in the Land Acquisition Act, 1894 (‘Act’  

for short) or other scheme, providing for allotment at cost price, a land loser  

could  certainly  claim allotment  in  terms  of  the  scheme.  But  the  Statute  

contemplates only benefits like solatium, additional amount and higher rate  

of interest to the land losers and not allotment of plots at cost price.  Nor  

does  the  State  Government  or  HUDA  have  any  scheme  providing  for  

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allotment of plots at actual cost to land losers. We are informed that State of  

Haryana  is  now proposing  to  introduce  a  more  attractive  and  land-loser  

friendly rehabilitation and resettlement policy, which contemplates allotment  

of bigger residential/commercial/industrial plots to land losers and oustees.  

But that is for the future.

11. Where there is a scheme but it does not regulate the allotment price, it  

may be possible for the court to direct the State Government/Development  

Authority to allot plots to land losers at a reasonable cost, and in special and  

extraordinary circumstances, it may also indicate the manner of determining  

the allotment price. But where the scheme applicable specifies the price to  

be charged for allotment, its terms cannot be ignored. If any land loser has  

any grievance in regard to such scheme, he may either challenge it or give a  

representation for a better or more beneficial scheme. But he cannot ask the  

court to ignore the terms of an existing or prevailing scheme and demand  

allotment at  cost  price.  The scheme of HUDA contemplates  allotment of  

plots only in terms of the scheme, that is at normal allotment rates.  This  

benefit is extended in addition to the benefits under sections 23(1A), 23(2)  

and 28 of the Act, and therefore the scheme provides for allotment at normal  

allotment rate. Necessarily, the allotment and the price to be charged, will  

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have to be strictly in accordance with such HUDA Scheme. In this case the  

HUDA scheme requires the land loser-allottee to pay the normal allotment  

rates for the plots to be allotted to them under the scheme. Therefore, a land  

loser  cannot  claim  allotment  of  a  plot  at  acquisition  cost  of  land  plus  

development cost or at any other lesser price. The decision in  Hansraj H.  

Jain was a case where the scheme did not provide for any allotment price,  

and  the  price  demanded  was  Rs.13,200/-  per  sq.m.  as  against  the  

compensation  of  Rs.4  per  sq.m.  which  in  effect  was  3300  times  the  

acquisition price. It was on those peculiar facts and circumstances, this court  

thought it fit to direct the respondents therein to adopt the acquisition cost  

plus development cost as the allotment price. That principle will not apply  

where there is a specific scheme which provides the rate of allotment.  

Re : Question (ii)

11. As noticed above, the scheme requires the allottees under the scheme  

for land-losers/oustees,  to pay the  normal allotment  rates for the allotted  

plots. The question is what is the meaning of the term ‘the normal allotment  

rate’.  No  doubt,  the  term  would  ordinarily  refer  to  the  allotment  rate  

prevailing at the time of allotment.  If an acquisition is made in 1985 and the  

developed layout in the acquired lands is  ready for allotment of plots in  

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1990, and allotments are made in the years 1990, 1991, 1992, 1993, 1994  

and 1995 at annually increasing rates, a land- loser who is allotted a plot in  

1990 will naturally be charged a lesser price. But if his application is kept  

pending by the  Development  Authority  for  whatsoever  reason and if  the  

allotment is made in 1992, he may have to pay a higher price; and if the  

allotment is made in 1995 he may have to pay a much higher price. The  

question is whether any discrimination should be permitted depending upon  

the  whims,  fancies  and  delays  on  the  part  of  the  authority  in  making  

allotments. To take this case itself, the application for allotment was made in  

1990.  On 9.9.1991,  HUDA advertised  the  residential  plots  in  the  sectors  

developed from the acquired lands for allotment, wherein the allotment rate  

was shown as Rs.1032 per sq.m. (Rs.863/- per sq.yd) for plots of 300 sq. m.  

In the year 1993, the allotment price was increased to Rs.1342/- per sq.m.  

(Rs.1122/- per sq.yd.) and the appellants are required to pay the 1993 price  

instead of paying the rate in vogue when the layout was ready for allotment.  

Should the land loser who promptly made the application in 1990 be made  

to  suffer,  because  of  the  inaction  on  the  part  of  HUDA  in  making  the  

allotment?  We get the answer in the HUDA scheme itself.  

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12. The policy clearly states that “claims of the oustees shall be invited  

before the sector is floated for sale”. This is also reiterated in the subsequent  

scheme  dated  19.3.1992  which  provides  that  “claims  of  the  oustees  for  

allotment of plots under this policy shall be invited by the Estate Officer,  

HUDA  concerned,  before  the  sector  is  floated  for  sale”.  It  is  therefore  

evident  that  the  land  loser-applicants  for  allotment  should  be  given  the  

option to buy first, before the applications for allotment are invited from the  

general  public.  This  means that the prices to be charged will  be the rate  

which is equal to the rate that is fixed when the sector was first floated for  

allotment. In this case, it is not in doubt that when the sector was floated for  

sale,  the rate that  was fixed in regard to plots of 300 sq.m.  or  less,  was  

Rs.1032/-  per  sq.  m.  (Rs.863/-  per  sq.yd).  The  appellants  had  made  the  

applications in 1990 and approached the High Court in 1992. There was  

even a direction by the High Court to consider their applications within a  

fixed  time.  The  appellants  should  therefore  be  allotted  plots  under  the  

scheme at the initial price at which the Layout/Sector plots were first offered  

for sale after the acquisition.  Merely because HUDA delayed the allotment  

in spite of the applications of the appellants and the order of the High Court,  

and made the allotments only after a contempt petition was filed, does not  

mean that the appellants become liable to pay the allotment price prevailing  

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as on the date of allotment. Having regard to the terms of the scheme which  

clearly requires that the land losers shall be invited to apply for allotment  

before the sector is floated for sale, it  is clear that the initial  price alone  

should be applied provided the land losers had applied for allotment at that  

time. In this case such applications were in fact made by the appellants. We  

are therefore of the view that the respondents could charge for the allotted  

plots only the rate of Rs.1032/- per sq.m. (or Rs.863/- per sq.yd.) and not the  

rate as revised in 1993 namely Rs.1122/- per sq.yd.  

13. We therefore allow this appeal in part and set aside the orders of the  

division bench and the learned Single Judge of the High Court and direct the  

respondents to charge for the six plots allotted to the appellants at a price of  

Rs.1032/- per sq.m. (or Rs.863/- per sq.yd) instead of Rs. 1342/- per sq.m.  

Each of the appellants will be entitled to costs of Rs.2500/- from HUDA.  

……………………………..J. (R V Raveendran)

New Delhi; ………………………….J. January 3, 2011. (A K Patnaik)  

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