Prospective overruling in allotment disputes preserves settled transactions while permitting lawful cancellation of non-conforming allotments.

The article explains that a judicial declaration affecting discretionary allotments may be confined prospectively where retrospective application would unsettle completed transactions, create uncertainty, and lead to unequal treatment among similarly placed allottees. The Court treated prospective overruling as a tool to preserve settled arrangements and public interest, while still allowing lawful action against allotments that were not consistent with the earlier regime. On that basis, the later ruling was limited to operate from 23.4.1996, and pre-23.4.1996 allotments could be cancelled only if they did not conform to the earlier decision and after due procedure.

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Issues: Whether the High Court's ruling on discretionary allotments under the Haryana Urban Development Authority Act should operate prospectively from 23.4.1996 to avoid reopening settled allotments and discrimination among similarly placed allottees.

Analysis: The dispute concerned allotments made under the discretionary quota and the consequences of applying the High Court's later ruling to transactions that had been acted upon for years. The Court noted that the earlier regime had been followed for nearly a decade and that parties had altered their positions on that basis. It further observed that a prospective declaration of law is used to avoid reopening settled matters, prevent uncertainty and reduce avoidable litigation. Applying the later High Court judgment only prospectively was found necessary to avoid anomalies and unequal treatment among allottees.

Conclusion: The High Court's judgment in Anil Sabharwal was held to be effective only from 23.4.1996, and allotment orders made prior to that date could be cancelled only if they were not in conformity with the earlier decision and after due procedure.

Final Conclusion: The appeals succeeded to the extent of limiting the operation of the High Court's ruling prospectively, thereby protecting settled allotments from retrospective disturbance while permitting lawful cancellation of non-conforming pre-23.4.1996 allotments.

Ratio Decidendi: A judicial declaration affecting allotments or similar settled transactions may be confined prospectively where retrospective application would unsettle completed arrangements and cause discrimination; prospective overruling may be used to preserve certainty and public interest.

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