TaxTMI 
TaxTMI 
2015 (8) TMI 1495
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....rant of licence, stands dismissed. Such appeal was directed against an order dated 16.9.2011 passed by the Director General, Town and Country Planning, Haryana. The petitioners are owners of land measuring 108 kanal 19 marla (13.61875 acres) in the revenue estate of village Ullawas, Tehsil and District Gurgaon. As per the petitioners, the minimum area for grant of licence for a Group Housing Colony is 10 acres. The petitioners applied for licence for developing a Group Housing Colony in terms of the Haryana Development and Regulation of Urban Areas Act, 1975 (for short 'the 1975 Act') on 10.9.2010, received by the respondents on 13.9.2010. The petitioners state that they meet the criteria for grant of licence even if partition of the land measuring 13 kanal 15 marla was pending at that time as it came to be decided on 22.12.2011. It is pointed out that, on the other hand, the Director General, Department of Town and Country Planning, Haryana, has granted licences to the private respondents by seeking removal of deficiencies by such respondents, though the similar treatment was not extended to the petitioner. The undisputed facts are that earlier a Final Development Pl....
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....at the General Public that the applicant may apply at his/her own risk fully knowing the above stated position. Any application received on the basis of proposed proposals in Draft Development Plan, Gurgaon-Manesar. Urban Complex - 2025 before its publication in official Gazette will be rejected." The petitioners applied for licence on 10.9.2010 in Sector 60 though in the Draft Development Plan published later, such land now forms part of Sector 63-A, Gurgaon. The private respondents submitted their respective applications for Group Housing Licences on 4.10.2010 itself, the day draft development plans was published in the official gazette and a public notice in the news papers was published. It is pointed out by the petitioners that some of the respondents have prepared the demand draft(s) of the requisite amount for licence on 1.10.2010 itself. A show cause notice dated 6.10.2010 was given to the petitioners that the application for grant of licence for 13.61875 acres cannot be considered in terms of Section 3(3)(b) of the 1975 Act. Subsequently, the request for grant of licence was declined on 9.11.2010. The reasons communicated in the forwarding letter read as under:- ....
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....fied copy of this order. In case, the application is decided against the petitioner, and a license is granted to any other party, the license so granted, shall remain in abeyance, for a week so as to enable the petitioners to file an appeal. The order dated 04.10.2010 (Annexure P-6) is consequently set aside. No order as to costs." It is thereafter the request of the petitioners for grant of licence was declined on 19.9.2011 vide Annexure P. 14. The petitioners challenged the said order in CWP No. 18511 of 2011, which was disposed of with liberty to the petitioners to file an appeal against the impugned order. It is thereafter the Principal Secretary, Government of Haryana passed the order on 20.9.2013. The relevant extracts from the said order read as under:- "7. ...........The appellants land, though not a part of the Development Plan as published on 05.02.2007, on the date of submission of their application for license, intentionally mislead the department, claiming it to be falling in Sector-60, Gurgaon. Similarly there is no merit in the contention of the appellant that the grounds of rejection were not mentioned in the notice dated 30.08.2011. The application of t....
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....d from time to time in the present writ petition. However, on 13.8.2015, the following two questions were framed to be considered:- "1. How the licence for development of a colony can be granted on publication of draft development plans published in terms of Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, 1963? 2. As to how the policy for grant of licence on first come first served basis is fair and reasonable, in view of the Hon'ble Supreme Court judgment titled as Centre for Public Interest Litigation and others v. Union of India and others, 2012 (3) SCC page 1? In pursuance of such order, an additional affidavit of the Chief Town Planner, Haryana dated 19.8.2015 was filed relying upon the policy dated 5.7.2012. The said policy reads as under:- "The matter pertaining to fixing the effective date for acceptance and consideration of licence applications vis-`-vis the publication of Development Plans has been considered by the Government keeping in view the present practice of accepting such applications after notification of the Draft Development Plans in the Official Gazette and at times even grant of licenc....
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....nd licence fee of any date prior to publication of Draft/Final Development Plan, as the case may be, shall also be accepted provided the same is valid for at least one month from the date of submission of the application. However, the effective date for acceptance and consideration of licence applications shall continue to remain as prescribed under Sr. No. (i) and (ii) above. (v) Any application submitted prior to the prescribed effective date shall be considered as premature and shall be returned for re-submission after publication of the respective Development Plan." In the affidavit, it has been stated that the 1963 Act is umbrella legislation for the purpose of regulating the development in the scheduled area and hence the land use proposal of the development plan forms basis for consideration of the licence applications under the 1975 Act. The Department continued to receive the licence applications on the basis of revised draft development plans, but the licences were granted only after publication of the Final Development Plan in the year 1996 and later revised on 5.2.2007. It is said to the following effect:- "4. That in this regard, it is submitted th....
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....her change is envisaged in any subsequent development plan of that area for which in-principle approval of the Government has been obtained and that there is no recommendation of DPC/SLC to effect amendments in the Development Plan proposals already in vogue of the applied area. Even this is done with the prior approval of the State Government. Hence, at present, no licence application in High and Hyper Potential Zones is considered for grant of licence on the basis of the Draft Development Plan. 5. That regarding second observation as to how the policy for grant of licence on first come first served basis is fair and reasonable in view of the Hon'ble Supreme Court judgment titled as Centre for Public Interest Litigation and others v. Union of India and others, it is clarified that the said policy of first come first served has been adopted as a 'Principle of Natural Justice'. It is further added that since no natural resource in the ownership of Government is being offered through a licence under Act No. 8 of 1975, the Hon'ble Supreme Court judgment in Centre for Public Interest Litigation and others v. Union of India and others does not appear to be appli....
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.... is the reasonable basis for grant of licences. It is also argued that the judgment in Centre for Public Interest Litigation and others v. Union of India and others, 2012 (3) SCC page 1, is materially different as it was a case of licence(s) of the natural resources, but in the present case, the licence is not for a natural resource but in respect of a property owned by the respondents. Therefore, the principles laid down in the aforesaid case cannot be extended to the facts of the present case. Shri Arun Monga, learned counsel representing respondent No. 7 argued that the principle of first come first served basis is not a principle followed by the State. In fact said respondent was applicant No. 17 on 4.10.2010 but has been granted licence. Therefore, it is the suitability of an applicant which is taken into consideration for the grant of licences. Shri Aashish Chopra, learned counsel representing respondent No. 6 argued that the petitioners applied for a licence of Sector 60 and in respect of which no density was available. The density is explained to mean the extent of area available for Group Housing Licence, which as per the State Government is 20% of the area of the re....
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.... reject the plans with directions to the Director to prepare fresh plans according to such directions. (4) The Government shall cause to be published by notification the plans approved by it under sub-section (3) for the purpose of inviting objections thereon. (5) Any person may, within thirty days from the date of publication of the notification under sub-section (4), send to the Director his objection and suggestion in writing, if any, in respect of such plans and the Director shall consider the same and forward them with his recommendations to the Government within a period of sixty days from the aforesaid date. (6) The Director shall also give reasonable opportunities to every local authority, within whose local limits any land included in the controlled area is situated, to make any representation with respect to the plans. (7) After considering the objections, suggestions and representations if any, and the recommendations of the Director thereon, the Government shall decide as to the final plans showing the controlled area and signifying therein the nature of restrictions and conditions applicable to the controlled area and publish the sam....
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....d area is situated." Haryana Development and Regulation of Urban Areas Act, 1975 3. Application for licence.-(1) Any owner desiring to convert his land into a colony shall, unless exempted under Section 9, make an application to the Director, for the grant of licence to develop a colony in the prescribed form and pay for it such fee and conversion charges as may be prescribed. The application shall be accompanied by an income-tax clearance certificate:- Provided that if the conversion charges have already been paid under the provisions of the Punjab Scheduled Roads and controlled Areas Restriction of Unregulated Development Act, 1963 (41 of 1963), no such charges shall be payable under this section (2) On receipt of the application under sub-section (1), the Director shall, among other things, enquire into the following matters, namely:- (a) title to the land; (b) extent and situation of the land; (c) capacity to develop a colony; (d) the layout of a colony; (e) plan regarding the development works to be executed in a colony; (f) conformity of the development schemes of the colony land to thos....
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.... first come first served basis. Such is admitted position by all the parties appearing before this court except Respondent No. 7. Respondent No. 7 got a licence earlier in point of time though it was at Serial No. 17. The question to be examined is as to whether the licence granted on the basis of first come first served basis is fair and reasonable method of allotment of licence? The 1963 Act is the umbrella legislation dealing with the controlled area and also prescribes the procedure for preparation and publication of the development plans regulating the construction within the controlled area. Such Act does not contemplate the grant of licences for development of a Group Housing Colony but contemplates grant of licences for change of land use. Under 1975 Act, an application for a licence can be filed with the documents of title of the land; extent and situation of the land; capacity to develop a colony and the layout of a colony. There is no reference to the requirement of conformity with any development plan at the time of submission of the application for the Group Housing Licence. It is only at the time of grant of license, the development plan becomes relevant in terms o....
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....rom the Government files or the files of the agency/instrumentality of the State that a particular public property or asset is likely to be disposed of or a contract is likely to be awarded or a licence or permission is likely to be given, he would immediately make an application and would become entitled to stand first in the queue at the cost of all others who may have a better claim. 95. This Court has repeatedly held that wherever a contract is to be awarded or a licence is to be given, the public authority must adopt a transparent and fair method for making selections so that all eligible persons get a fair opportunity of competition. To put it differently, the State and its agencies/instrumentalities must always adopt a rational method for disposal of public property and no attempt should be made to scuttle the claim of worthy applicants. When it comes to alienation of scarce natural resources like spectrum etc., it is the burden of the State to ensure that a non-discriminatory method is adopted for distribution and alienation, which would necessarily result in protection of national/public interest. 96. In our view, a duly publicized auction conducted fairl....
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....here is no constitutional mandate in favour of auction under Article 14. The Government has repeatedly deviated from the course of auction and this Court has repeatedly upheld such actions. The judiciary tests such deviations on the limited scope of arbitrariness and fairness under Article 14 and its role is limited to that extent. Essentially, whenever the object of policy is anything but revenue maximisation, the executive is seen to adopt methods other than auction. 130. A fortiori, besides legal logic, mandatory auction may be contrary to economic logic as well. Different resources may require different treatment. Very often, exploration and exploitation contracts are bundled together due to the requirement of heavy capital in the discovery of natural resources. A concern would risk undertaking such exploration and incur heavy costs only if it was assured utilization of the resource discovered: a prudent business venture would not like to incur the high costs involved in exploration activities and then compete for that resource in an open auction. The logic is similar to that applied in patents. Firms are given incentives to invest in research and development with the ....
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.... alienation/allotment of natural resources, cannot be held to be a constitutional requirement or limitation for alienation of all natural resources and therefore, every method other than auction cannot be struck down as ultra vires the constitutional mandate." In the light of the aforesaid judgments, we do not find any merit in the argument that the grant of licence on the basis of first come first serve basis is fair, reasonable or transparent method. It is wholly immaterial that the licence is sought in respect of the land owned by them. The fact is that without licence, the Group Housing cannot be set up. The licence is a pre-requisite condition to develop a colony which is a privilege granted by the State and is largesse. In the absence of a licence, a land owner continues to be owner of the land. There is no compulsion for him to change the land use or to set up a colony, but once it is proposed to set up a colony, then the statutory conditions, pre-requisite for grant of a licence, are to be satisfied. We further find that the principle of first come first served basis has led to an unholy race. The petitioners submitted their application dated 10.9.2010 which was recei....