TaxTMI 
TaxTMI 
2010 (12) TMI 1349
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....#39;B'. Possession of the site was delivered to him on the same day as per the possession certificate at Annexure 'C' He sold the site in favour of Madhu Dhondiba Babar through a sale deed at Annexure 'E' dated 23.6.2007. Madhu Dhondiba Babar sold the said site as per the sale deed at Annexure 'G' dated 7.11.2007 in favour of the Petitioner. Subsequently, katha of the property was transferred in his favour by the Bruhat Bangalore Mahanagara Palike. 3. It is further contended that BDA has advertised in the newspaper announcing the sale of a corner site No. 12 in Sector 5 of HSR layout, which is adjacent to the site purchased by the Petitioner. The Petitioner, who was interested in the adjacent site, participated in the bid. He is the highest bidder and the bid amount was Rs. 1,50,96,640/-. After receiving the entire bid amount, the BDA executed the sale deed dated 2.5.2008 in favour of the Petitioner in respect of the said site. Thus, the Petitioner is the owner of site bearing No. 11A and corner site bearing No. 12 in Sector 5 of HSR Layout. 4. It is further contended that when this is the state of affairs, the Petitioner came to know that a notice....
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....Respondent after having executed a registered sale deed, conveying right, title and interest, cannot cancel the allotment of the site. 6. In W.P. No. 16954/2009, the Petitioner contends that he is the owner and in possession of the site bearing No. 4HC-201/A situated at East of NGEF Layout, Bangalore. BDA had allotted the site No. 119KG-103 in favour of one James on 15.5.1989. BDA had executed a lease-cum-sale deed on 16.7.1990. Since the BDA could not deliver possession of the site as it was in unauthorised occupation of certain other persons, an alternative site No. 4HC-201/A was allotted in favour of James. BDA had executed a sale deed dated 21.11.2007 in favour of James. Possession certificate in respect of the said site was issued in favour of James on 23.11.2007. Being the owner and in possession, he sold the said property in favour of the Petitioner through a deed of sale dated 11.2.2008. Thereafter, a notice was issued by the BDA to James calling upon him to show cause as to why the allotment of site should not be cancelled. James filed objections to the said notice on 12.5.2009. On enquiry, James came to know that BDA has passed an order on 9.6.2009 cancelling the allot....
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....ing in site No. 12 was 6.40 x 24.40 mtrs. From the particulars obtained by the Respondent, it was clear that irregularities have been committed in bifurcating the corner site and allotting the same in favour of S. Kumar Bangarappa. On the strength of illegal bifurcation, the remaining extent of 6.40 x 24.40 sq. mtrs. in site No. 12 was put to auction on 21.11.2007. The Petitioner has purchased the corner site in the auction held by the BDA. As a result of the irregularities in bifurcating corner site No. 12 as site Nos. 11 -A and 12, sale deed came to be executed in the name of S. Kumar Bangarappa on his paying Rs. 8,58,974/- and possession certificate was issued to him. It is further contended that BDA is not aware of the subsequent sale by S. Kumar Bangarappa to Madhu Dhondiba Babar and the purchase of the property by the Petitioner from the said Madhu Dhondiba Babar. It is argued that the bifurcation of the corner site was done with an ulterior motive. In order to curb such activities, action was initiated for cancellation of allotment of the said site. Based on the cancellation of the allotment, the original allottee was called upon to surrender necessary documents and he was c....
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....arned Senior Counsel contends that neither the BDA Act nor the Rules made thereunder authorise the State Government to allot sites formed by the BDA as per the scheme framed under Section 16 of the BDA Act. It is submitted that the BDA being a creation of the Statute, its powers are circumscribed by the Statute. The Act has not conferred upon the State Government to give directions to the BDA to allot the sites. The allotment of the sites should be made strictly in accordance with the provisions of the BDA Act and the Rules made thereunder. It is argued that while issuing circular under Rule 5 of BDA (Allotment of Sites) Rules, 1984, the Government cannot retain power to allot sites under 'G' category. It is further contended that under 1984 Rules, BDA is not authorised to execute the sale deed immediately after allotment of the site. Rule 13 is applicable to all the categories of allotments under the said Rules. It is further contended that the Petitioner has purchased property from its previous owner as per the sale deed at Annexure 'G' dated 7.11.2007 for a consideration of Rs. 1 crores 20 lakhs. The katha has been transferred by the BBMP in his favour on 18.3.20....
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....d the extent remaining in site No. 12 was 6.40 x 24.40 mtrs. On the strength of the illegal bifurcation, the remaining extent of land 6.40 x 24.40 sq. mtrs. in site No. 12 was put into auction on 21.11.2007 and the Petitioner has purchased the said corner site. It is argued that the layout plan does not disclose the existence of two sites viz., site Nos. 12 and 11-A. Site No. 11-A has been illegally carved out of site No. 12 and allotted in favour of S. Kumar Bangarappa, as an alternative site. The bifurcation was done with an ulterior motive. With a view to curb such illegal activities, action has been initiated for cancellation of the site. In view of the said illegalities, huge financial loss has been caused to the BDA. It is argued that as per the BDA (Disposal of Comers and Commercial Sites) Rules, 1984, it is mandatory to dispose of all comer and commercial sites by public auction. In the case on hand, after illegally bifurcating site No. 12, it was allotted in favour of S. Kumar Bangarappa. 14. Sri B.V. Shankara Narayana Rao, Learned Counsel has supported the action of the BDA in cancelling the sale deed executed in favour of the vendor of the Petitioner in W.R No. 16954/....
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....ing creating thereby avoidable confusion. That is why Bangalore Development Authority Act was brought into force. It is an Act to provide for the establishment of a development authority for the development of the City of Bangalore and areas adjacent thereto or for the matters connected therewith. On the issue of Notification under Section 3(i) of the Act, constituting the Bangalore Development Authority, the City of Bangalore Improvement Act, 1945 (Mysore Act 5 of 1945) was repealed. The object of the Authority is to promote and secure the development of Bangalore Metropolitan Area and for that purpose, the Authority has the power to acquire, hold, manage and dispose of movable and immovable property whether within or outside the areas under its jurisdiction, to carry out building, engineering and other operations and generally to do all things necessary or expedient for the purpose of such development and for the purposes incidental thereto. 19. Chapter III of the Act provides for drawing up of development schemes by the Authority for the development of Bangalore Metropolitan Area. Section 16 lays down the particulars to be provided in a development scheme drawn up by the Auth....
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....arrying out the purposes of this Act, and it shall be the duty of the Authority to comply with such directions. 21. Section 69 of the Act provides of making the Rules by the State Government to carry out the purposes of the Act, which is as under 69. Power to make Rules:(1) The Government may by Notification make rules to carry out the purposes of this Act. (2) In particular and without prejudice to the generality of the foregoing power such rules may provide for all or any of the following matters, namely: (a) ... (b) ... (c) ... (d) ... (e) ... (f) ... (g) the restrictions, conditions and limitations subject to which the Authority may lease, sell or transfer movable or immovable property; (h) regulating the allotment or sale by auction of sites by the Authority. 22. Bef....
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....ut subsequently the allotment was either cancelled by the Authority or surrendered by the allottee or a site which has been formed on account of readjustment in the plan subsequent to the issue of Notification inviting applications for allotment of sites. Rule 5 of 1984 Rules deals with allotment of stray sites, which is as under: 5. Allotment of stray sites: The Bangalore Development Authority shall dispose of stray sites in accordance with the guidelines issued by Government. 24. Revised guidelines have been issued under Rule 5 vide circular No. HUD 616 MNX 89 dated 17.10.1992, which is as under: GOVERNMENT OF KARNATAKA (Housing and Urban Development Department) No: HUD 616 MNX 89 Karnataka Government Secretariat, M.S. Building, Bangalore, Dated 17th October, 1992 CIRCULAR Sub: Revised Guidelines for the allotment of stray sites by the Bangalore Development Authority. Ref: Circular No. HUD 616 MNX 89, Dated 18.9.1989 and 23.9.1989. *** ....
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....ctober 1992. *** In supersession of all the orders issued regarding allotment of stray sites the following revised guidelines for disposal of stray sites are issued as provided under Rule 5 of the Bangalore Development Authority (Allotment of Sites) Rules, 1984. Sl. No. Category Description Percentage 1. A. Disposal by Auction 30 2. B Persons who have won special recognition in the field of sports at International/ National levels persons of Karnataka Domicile 15 3. C Persons who have won special recognition in the filed of Arts, Science, Literature, Education, Medicine, and Public Administration at the National/ International levels. 10 4. D Ex-Military Personnel, Military Personnel, persons of Karnataka domicile 5 5. E Freedom Fighters who are residents of Bangalore for a period of not less than 10 years 5 6. F Dependents of Karnataka Government Servants when the latter dies during the performance of his/her duty 5 7. G Persons in public life as may be directed by Government 30 2. Category 'C' besides Arts etc., ....
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....r. 26. It is clear from the aforesaid circular that 30% of the stray sites should be allotted to the persons in public life as may be directed by the State Government. Clause 5 of the circular was substituted by corrigendum No. UDD 129 MNJ 97 (P) dated 26.8.1997. Previously Clause 5 of the circular dated 6.8.1997 was as under: The stray sites may be allotted by a Committee consisting of the Chairman, Bangalore Development Authority, Commissioner, Bangalore City Corporation, and two other members of the Authority. The allotment be subject to final approval of the Authority. 27. It is also relevant to note here that in exercise of the power conferred under Section 69 of the Act, the Government of Karnataka has made Rules for disposal of comer sites and commercial sites known as "Bangalore Development Authority (Disposal of Comer Sites and Commercial Sites) Rules, 1984". Sub-section (d) of Section 2 defines ' comer site' to mean the site at the junction of two roads having more than one side of the site facing the road. A comer site has to be disposed of strictly in accordance with the said Rules. 28. BDA is a body corporate having a perpetual su....
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....he scheme and the Act and virtually would amount to fraud or a breach of trust. The said decisions have been approved by a Division Bench of this Court in Telecom Employees Co-Operative Housing Society Ltd. v. Scheduled Castes, Scheduled Tribes, Minority Communities & Backward Classes Improvement Centre ILR 1990 KAR 3320. 29. None of the provisions of the Act authorise the State Government to direct the BDA to allot stray sites. Rule 5 of the City of Bangalore Improvement (Allotment of Site) Rules, 1972 authorised the Board to allot a stray site to a person, who is eligible for allotment of a site under Rule 10. A provision was made in the BDA (Allotment of Sites) Rules, 1982 for disposal of stray sites in accordance with the directions issued by the State Government from time to time. Rule 5 in the said Rules was contrary to the intendment of the Act, which was rightly repealed by the Government. BDA (Allotment of Sites) Rules, 1984, are made by the State Government for disposal of sites by the BDA. There is a marked difference between Rule 5 of the 1982 Rules and 1984 Rules. The 1982 Rules provided for disposal of stray sites as per the directions of the State Government, wher....
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....ry or expedient for carrying out the purposes of the Act. This is an omnibus statutory provision, which invests the State Government with the power to issue such directions, which in its opinion would be conducive to the implementation of the purposes of the Act. In S. Vasudev v. Government of Karnataka 1999 (1) KLJ 116, a Division Bench of this Court has held that allotment of sites to the legislators through the society at the instance and under the directions of the Government of Karnataka under Section 65 of the Act is illegal and motivated by extraneous considerations. A Division Bench of this Court in Telecom Employees Co-Operative Housing Society Ltd. 'sense (supra), was considering the case of bulk allotment of lands by the State Government before the insertion of Sections 38-B and C. It has been held that there is no general power for allotment of the sites because Section 38 of the Act would exclude the general power. There is no power to issue directions to make bulk allotment of the land under Section 65 of the Act. It has been held as under Under Section 65, the Government is enabled to give directions to the BDA 'as are necessary or exped....
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....on behalf of the people. He has to deal with the people's property in a fair and just manner. He cannot commit breach of the trust reposed in him by the people In Onkar Lal Bajaj and Ors. v. Union of India and Anr.: (2003) 2 SCC 673, the Apex Court has summarised the cardinal principles of governance, which is as follows: 35. The expression "public interest" or "probity in governance" cannot be put in a straitjacket. "Public interest" takes into its fold several factors. There cannot be any hard-and-fast rule to determine what is public interest. The circumstances in each case would determine whether government action was taken in public interest or was taken to uphold probity in governance. 36. The role model for governance and decision taken thereof should manifest equity, fair play and justice. The cardinal principle of governance in a civilized society based on rule of law not only has to base a transparency but must create an impression that the decision making was motivated on the consideration of probity. The Government has to rise above the nexus of vested interests and nepotism ....
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....No. UDD 1178; BEM BHOO SWA dated 11.2.2004, orders were issued to allot a site measuring 50 ft x 80 ft. under 'G' category to Sri S. Kumar Bangarappa, the then Minister of State for Municipal Administration. Following the said direction, a site measuring 50 ft x 89 ft. bearing No. 5M-681 at OMBR Layout was allotted to him vide allotment letter dated 21.12.2004 for Rs. 8,58,400/-.The allottee failed to pay the allotment money within the prescribed period and therefore, a show cause notice was issued on 19.8.2005. Since no response was received, the Respondent passed an order dated 28.3.2006 cancelling the allotment. The said order was sent to him on 28.3.2006. 4. On 20.2.2007, Sri S. Kumar Bangarappa submitted a letter stating that he could not pay the sital value within the time provided and requested for allotment of another site since the site already allotted had been registered in favour of other party. On 13.6.2007, allotment letter was issued to him allotting site No. 11-A, HSR Layout, Sector-5, measuring 50 x 80 ft. at allotment price of Rs. 8,58,500 + Rs. 50/- as site exchange charges. On 31.7.2007, the said allotment was confirmed by the Alter....
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....t an early stage itself. In view of the said illegalities, which have caused huge financial loss and illegal formation of site, it has become necessary to cancel the allotment of so called site No. 11/A. Therefore, the allotment was cancelled. Based on the cancellation of the allotment, the original allottee has been called upon to surrender necessary documents, and he is also cautioned that if documents are not surrendered as per Rules, action will be initiated. 7. It is submitted that as per the BDA (Disposal of corner and commercial sites) Rules, 1984, it is mandatory to dispose of all corner and commercial sites by public auction. Whereas in the case on hand, after illegally bifurcating site No. 12, it was allotted in favour of Sri S. Kumar Bangarappa. The sale deeds executed by the said allottee and the one executed in favour of the Petitioner as per Annexures 'E' & 'G' show that it was disposed of at a very high price immediately after allotment. By virtue of illegal formation of the site, BDA was made to suffer loss of crores of rupees at the behest of some unscrupulous elements. After noticing the same and after obtaining necessary repo....
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....their mala fide acts in the discharge of their functions as public servants. In this connection, it is relevant to note the observations of the Apex Court in COMMON CAUSE'S case (supra), which is as under: We take it to be perfectly clear, that if a public servant abuses his office either by an act of omission or commission, and the consequence of that is injury to an individual or loss of public property, an action may be maintained against such public servant. No public servant can say "you may set aside an order on the ground of mala fide but you cannot hold me personally liable". No public servant can arrogate to himself the power to act in a manner, which is arbitrary. Therefore, action has to be initiated against the officials of the BDA, who were responsible for illegally bifurcating the site resulting in huge loss to the BDA. 35. Rule 5 of BDA (Allotment of sites) Rules, 1984 provides for disposal of stray sites in accordance with the guidelines issued by the Government. Rule 8 provides for registration for allotment of the sites. Rule 9 lays down the procedure for making an application for allotment of the site. Rule 10 provides for the elig....
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....bsp; (ii) Subject to Clause (i), and the availability or sites, alternative sites may be allotted by the Authority in the same layout in which sites were originally allotted or in the layouts formed by the Authority subsequent to the formation of the layout in which the sites were originally allotted. (iii) Alternative sites shall not be allotted in layouts formed prior to the layout in which sites were originally allotted, even if sites are physically available in the layout/s formed prior to the layout in which original allotment was made. (iv) While allotting alternative sites, sites bigger in dimension than the sites originally allotted shall not be considered for allotment. However, an alternative site up-to ten percent over and above the area of the originally allotted site may be allotted and in such cases for the extra sital area involved, additional sital value applicable in that layout for that site shall be collected by the Authority in addition to the difference in sital value to be collected: (v) Provide....
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....ent and the State Legislatures have neither the time or expertise to be involved in detail or circumstances, nor can visualise and provide for new strange unforeseen or unpredictable situations. That is the raison d'etre for delegated legislation. The power to legislate carries with it the power to delegate. But excessive delegation may amount to abdication. Delegation unlimited may invite despotism uninhibited. So the theory has been evolved that the legislature cannot delegate its essential legislative function. Legislate it must, by laying down policy and principle and delegate it may to fill in detail and carry out policy. The legislature may guide the delegate by speaking through the express provision empowering delegation or the other provisions of the statute such as the preamble, the scheme or even the very subject matter of the statute. If guidance there is, wherever it may be found, the delegation is valid. This decision does not help the State in any manner. What is permissible is to leave the delegated authority the task of implementing the object of the Act. Neither the Act nor the Rules made therein authorise the State Government to issue directions to allot the s....
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....our of the persons suggested by it. 39. From the above discussion, it is clear that the State Government has no authority to direct the BDA to allot the sites under 'G' category as per the circular dated 6.8.1997. Point No. (i) is answered accordingly. Re. Point No. (ii) 40. In all these cases, the BDA had executed sale deeds in favour of the allottees. In W.P. No. 11102/2008, the BDA had executed the sale deed in favour of the allottee as per the direction of the State Government under 'G' category on 20.6.2007. The allottee has sold the said site in favour of Madhu Dhondiba Babar and Madhu Dhondiba Babar inturn had sold the site in favour of the Petitioner in the said writ petition. In W.P. No. 16147/2009, the Petitioners mother late Anusuyamma was an applicant for allotment of the site. The site was allotted on 9.3.1989. Before the expiry of the lease period, Anusuyamma had died bequeathing the said site in favour of the second Petitioner. The BDA allotted an alternative site to the second Petitioner and a sale deed was executed in his favour on 19.4.2007. The second Petitioner sold the said site to the first Petitioner on 4.8.2007. In W.P. No. 16954/200....
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.... be cancelled by the Court. This Court in Binny Mill Labour Welfare House Building Co-Operative Society Limited v. D.R. Mruthyunjayaaradhya ILR 2008 KAR 2245 was considering a similar case where the vendor of the property had unilaterally cancelled the sale deed. It is held as under: Unilaterally he cannot execute what is styled as a deed of cancellation, because on the date of execution and registration of the deed of cancellation, the said person has no right or interest in that property. Normally what can be done by a Court can be done by the parties to an instrument by mutual consent Even otherwise if the parties to a document agree to cancel it by mutual consent for some reason and restore status quo ante, it is possible to execute such a deed. An agreement of sale, lease or mortgage or partition may be cancelled with the consent of the parties thereto. Because in the case of agreement of sale, lease, mortgage or partition, each of the parties to the said document even after the execution and registration of the said deed retains interest in the property and, therefore, it is permissible for them to execute one more document to annul or cancel the earlier....