Estate Officer and Anr. v. Charanjit Kaur
HEMANT GUPTA, J.
1. This order shall dispose of three appeals bearing Civil Appeal
No. 4964 of 2021 - Estate Officer v. Charanjit Kaur, Civil Appeal No.
4965 of 2021 - Estate Officer v. Kamlesh and Civil Appeal No. 4966
of 2021 - Estate Officer v. D.K. Khanna raising identical que stions of
law.
2. In Civil Appeal No. 4964 of 2021, the order of the National
Consumer Disputes Redressal Commission 1 dated 24.05.2017 is the
subject matter of challenge. By the aforesaid order, the N CDRC has
dismissed the revision petition filed by the appellant agai nst an order
dated 16.05.2016 passed by the State Consumer Disputes Redress al
Commission2 affirming the order of the District Consumer Disputes
Redressal Forum3. The respondent had sought conversion of Plot No.
4059, Sector 46 D, Chandigarh, from leasehold to freehold s ite on
acceptance of the requisite conversion fee. The learned District Forum
directed the appellant to convert the said plot in question from leasehold
to freehold site on acceptance of requisite conversion fee; to pay an
amount of Rs. 10,000/- as compensation for mental agony and physical
harassment; and to pay Rs.5,000/- as costs of litigation.
3. The learned NCDRC relied upon the judgment of this Cour t
reported as Lucknow Development Authority v. M.K. Gupta 4 to hold
that the respondent would be considered to be a consumer as fe e had
1 For short the ‘NCDRC’
2 For short the ‘SCDRC’
3 For short the ‘DCDRF’
4 (1994) 1 SCC 243
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
been charged by the appellant for conversion. The NCDRC further held
that the administrator had put a note on the file that he would not like
to take any decision till he gets clear directions fr om the Central
Government. It was held that the appellant had not produced any public
notification suspending all conversions of plots from le asehold to
freehold, at least on 28.03.2013 when the application was recei ved in
the office of Estate Officer.
4. In Civil Appeal No. 4965 of 2021, the impugned order was
passed by NCDRC on 17.11.2017 relying upon the order passed in
Charanjit Kaur. In the said case, the respondent was allotted a site
under Chandigarh Milk Colony Allotment of Site Rules, 1975 5 on
08.08.1977 measuring 143 sq. yards on a leasehold basis for a peri od
of 30 years for the purposes of cowshed cum dairy. The Chandigarh
Conversion of Residential Leasehold Land Tenure into Freehold Land
Tenure Rules, 19966 were extended to the sites allotted under the 1975
Rules. The lease period of 30 years was extended by four years so
that 1996 Rules could be made applicable. The request of the respondent
for conversion of leasehold to freehold was not accepted which led to
filing of a complaint before the District Forum. The Dist rict Forum
passed an order on the same lines as in Charanjit Kaur. The NCDRC
also dismissed the revision filed by the appellant on 17.11.2017 relying
upon Charanjit Kaur.
5. In the third appeal herein i.e., Civil Appeal No. 4966 of
2021, the order under challenge is that of the NCDRC p assed on
21.03.2018 in respect of conversion of a residential site bearing no. 719,
Sector-43A, Chandigarh, from leasehold to freehold. The order in
Charanjit Kaur was followed in this matter as well.
6. Some of the statutory provisions need to be reproduced before
examining the respective contentions of the parties. Secti on 3 of the
Capital of Punjab (Development and Regulation) Act, 19527 reads as:-
“3. Power of Central Government in respect of transfer of l and
and building in Chandigarh. – (1) [Subject to the provisions of
this section, the Central Government may] sell, lease or otherwise
transfer, whether by auction, allotment or otherwise, any land or
5 For short ‘1975 Rules’
6 For short ‘1996 Rules’
7 For short ‘1952 Act’
127
building belonging to the Government in Chandigarh on such terms
and conditions as it may subject to any rules that may be ma de
under this Act, think fit to impose.
(2) The consideration money for any transfer under sub-section
(1) shall be paid to the [Central Government] in such manne r
and in such instalments and at such rate of interest as m ay be
prescribed.
(3) Notwithstanding anything contained in any other law for the
time being in force, until the entire consideration money together
with interest or any other amount, if any, due to the Cen tral
Government on account of the transfer of any site or building,
or both, under sub-action (12) is paid, such site or building, or
both, as the case may be, shall continue to belong to the Central
Government.”
7. In terms of power conferred on the Central Government under
Section 3, initially Chandigarh (Sale of Sites and Buildings) Rules, 19608
were published on 08.03.1960. Such rules contemplated sale of sites
by auction or allotment. The Chandigarh Lease Hold of Sites and
Building Rules, 1973 9 were thereafter published on 20.08.1973
authorizing Chandigarh Administration to demise sites and buildings at
Chandigarh on lease for 99 years by allotment or by auction. Rule 13
mandates that in addition to the premium i.e., price paid or promised
for the transfer of a right to enjoy an immovable pro perty under 1973
Rules, an annual rent would be payable which shall be 2½% of the
premium for 33 years which may be enhanced by the Cha ndigarh
Administration to 3.75% for the next 33 years and 5% of the premium
for the remaining period of lease. In terms of Rule 17, the property
could be transferred on payment of unearned increase in terms of Rule
17. The relevant provisions of 1973 Rules read thus:
“3. (1) Unless the context otherwise requires, the words and
expressions used in these rules shall have the meaning assigned
to them in the Capital of Punjab (Development and Regulation)
Act, 1952 and the rules made thereunder.
(2)“Premium” means the price paid or promised for the transf er
of a right to enjoy immovable property under these rules .
8 For short ‘1960 Rules’
9 For short ‘1973 Rules’
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
[“Prescribed mode of payment” means payment in cash or by
demand draft drawn on any Scheduled Bank situated a t
Chandigarh in favour of the Estate Officer, Chandig arh
Administration or in cash upto Rs.500/- or the amount paid i n
cash representing 25% of the premium at the time of aucti on].
13. Rent and consequences of non-payment- In addition to the
premium, whether in respect of site or building, the lessee shall
pay rent as under:
(i) Annual rent shall be 2-½ % of the premium for the 33 years
which may be enhanced by the Chandigarh Administration to
3-3/4% of the premium for the next 33 years and to 5% of the
premium for the remaining period of the lease.
17. General Conditions of lease. – (1) Lease may be jointly taken
by more than one person. The liability to pay the premium as
well as the rent and any penalty imposed under these rules shall
be joint and several:
(10) The lessee will not be entitled to transfer the si te or the
building without the prior permission of the Estate Officer. Such
permission shall not be given until the lessee has paid full premium
and the rent due under the lease for the site, unless in the opinion
of the Estate Officer exceptional circumstances exis t for the
grant of such permission. The lessee shall be liable to pa y such
transfer charges as are notified by the Chandigarh Administration
from time to time.”
Provided that where the property was leased out by allotm ent,
or at a reserve price or at any other concessional rate , or by
hire-purchase, then transfer shall be allowed on payment of 1/
3rd of the unearned increase in value. The unearned increase will
be assessed by the Estate Officer by determining the diff erence
between the current market value of the property and the present
value of the premium paid for the property. The current m arket
value of the property shall be assessed in view of the average
of auction price over the last three financial years for property
of the same category or such other evidence as the Estate Officer
deems to be appropriate. The present value of the o riginal
premium shall be calculated by enhancing the premium by 9%
per annum, compounded annually, from the date(s) of payment.
129
The difference between these two values shall be the unearne d
increase. During assessment, notice shall be issued to the lessee
and he shall be afforded an opportunity of being heard.”
8. The Chandigarh Administration framed 1996 Rules permitting
conversion of residential leasehold properties to freehold pr operties.
Some of the conditions of the said Rules are as follows:
“5. Land rates will be the rates as notified by the Chandigarh
Administration from time to time.
6. Conversion charges to be paid shall be as provided in
Annexure “A” annexed to these rules, from time to time.
8. The conversion shall also be allowed in the cases where
the lessees/sub-lessees/allottees have parted with the
possession of the property, provided that-
(a) The application for Conversion is made by a person
holding registered and valid power of attorney and
there is also an agreement to sell from the lessee
to sub-lessee to alienate (sell/transfer) the property
and proper linkage with the original allottee/lessee
is established.
9. In all cases of Conversion, the Conveyance-deeds shall
be got registered on payment of requisite Stamp Duty
and Registration Charges. The Consideration amount for
this purpose shall be the “Conversion Fee” and the
“Surcharge” wherever applicable. However, in cases
where lease deed has not been executed, the Price/
Premium of the site as reflected in the letter of allotment
or last agreement for sale or the predetermined rate as
prescribed by the Competent Authority on the date of
allotment/transfer shall also be added for the purpose
of calculation of Stamp Duty.”
ANNEXURE “A”
Part – I
STATEMENT SHOWING ONE TIME CONVERSION,
CHARGES/FEE FOR VARIOUS SITES ALLOTTED BY THE
ESTATE OFFICER, UNION TERRITORY , CHANDIGARH.
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
Site area in Sq.
Metres
Conversion
charges/fee to be
calculated as under
Formula for calculating
charges/conversion charges/fee
1 2 3
Upto 50 Nil Nil
The land rate has been fixed at Rs.1710/- per Square Metre and
the same shall be applicable for a period of one year from the
date as notified by the Estate Officer, Union Terri tory,
Chandigarh. The land rate applicable for calculatin g the
Conversion Charges shall be notified from time to time by the
Administrator, Union Territory, Chandigarh.”
9. The grievance of the allottees was that conversion was allowed
on pick and choose basis rather than on the basis of either the date of
receipt of the application or the date of decision. Reference was made
to the letter dated 10.5.2013 on behalf of the Finance Secretary t o the
Estate Officer. The said letter reads as: -
“To
The Estate Officer
U.T. Chandigarh
Memo No. 11/1/18-UTFI(2)-2013/3520
Dated: 10-5-2013
Subject: Re-fixation of rate for conversion of lease hold
residential sites into free hold.
Reference your memo No.7610/MA/Conversion Policy/2013
dated 4.3.13, on the subject cited above.
The issue of revision of rate for conversion under the scheme
“Chandigarh Conversion of residential lease hold land tenure into
freehold land tenure, Rule 1996” is under consideration of the
Administration.
You are directed not to allow any conversion under th e said
scheme till further orders.
Sd/-
Joint Secretary (Estates)
For Finance Secretary
Chandigarh Administration”
10. Mr. Ankit Goel, learned counsel for the appellant argued that
the title of leasehold property vests with the Central Gover nment in
131
terms of Section 3 of the Act and the Rules framed thereunder . The
Central Government had granted lease of residential plots for a per iod
of 99 years under the 1973 Rules. The conversion fee fixed to conver t
leasehold property leased for 99 years to freehold property, if allowed,
would absolve the allottees from payment of annual rent i n terms of
Rule 13 as well as the payment of unearned increase in the case of
transfer of leasehold rights in terms of Rule 17(10) of the 1973 Rules.
Thus, an un-encumbered title would pass on to the purchaser as against
99-year lease to an allottee under the 1973 Rules. Therefore, the findings
recorded by the NCDRC that the respondents are consumers as charges
have been paid for conversion are not tenable for the rea son that the
charges deposited were not for any services to be rendered but to grant
complete title to the allottees. Such conversion fee wa s in fact part of
the sale consideration to confer complete title to an allotte e.
11. Still further, it was argued that the reliance on the judgm ent
in M.K. Gupta was clearly erroneous inasmuch as that was a case
wherein the allotment of flats was considered to be “serv ice” within
the meaning of Section 2 (1) (o) of the Consumer Protection Act, 198610.
Some of the provisions from the Consumer Act as are relevant for the
decision of the present case are as under:
(c) “complaint” means any allegation in writing made by a
complainant that-
(i) xxx xxx xxx
(iii) the services hired or availed of or agreed to be hired
or availed of by him suffer from deficiency in any
respect;
(d) “consumer” means any person who-
xxx xxx xxx
(ii) hires or avails of any services for a consideration
which has been paid or promised or partly paid and
partly promised, or under any system of deferred
payment and includes any beneficiary of such
services other than the person who [hires or avails
of] the services for consideration paid or promised,
or partly paid and partly promised, or under any
10 For short ‘Consumer Act’
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
system of deferred payment, when such services
are availed of with the approval of the first
mentioned person [but does not include a person
who avails of such services for any commercial
purpose;
(g) “deficiency” means any fault, imperfection,
shortcoming or inadequacy in the quality, nature and
manner of performance which is required to be
maintained by or under any law for the time being in
force or has been undertaken to be performed by a
person in pursuance of a contract or otherwise in relation
to any service;
(o) “service” means service of any description which i s
made available to potential users and includes, but not
limited to, the provision of facilities in connection with
banking, financing insurance, transport, processing,
supply of electrical or other energy, board or lodging or
both, housing construction, entertainment, amusement or
the purveying of news or other information, but does not
include the rendering of any service free of charge or
under a contract of personal service;
14. Finding of the District Forum.—(1) If, after the proceeding
conducted under Section 13, the District Forum is satisfied th at
the goods complained against suffer from any of the de fects
specified in the complaint or that any of the allegations contained
in the complaint about the services are proved, it shall i ssue an
order to the opposite party directing him to do one or more of
the following things, namely:
(a) xxx xxxx
(e) to remove the defects in goods or deficiencies in the
services in question;
(f) xxx xxxx
12. In M.K. Gupta , the question posed was as to the word
“service” extends to the deficiency in construction of a house or flat.
It was held that such construction was for the benefit of per son for
whom it was to be constructed. The allottee may do so himself or hire
133
services of a builder or contractor. When a statutory authority develops
land or allots a site or constructs a house for the benefit of common
man, it is a statutory service. But if such service is provided by a builder
or contractor, it would be a contractual service. The Court held as under:
“4. What is the meaning of the word ‘service’? Does it exte nd
to deficiency in the building of a house or flat? Can a complaint
be filed under the Act against the statutory authority or a builder
or contractor for any deficiency in respect of such property. The
answer to all this shall depend on understanding of the word
‘service’. The term has variety of meanings. It may mea n any
benefit or any act resulting in promoting interest or happiness. It
may be contractual, professional, public, domestic, legal, statutory
etc. The concept of service thus is very wide. How it should be
understood and what it means depends on the context in which
it has been used in an enactment. Clause ( o) of the definition
section defines it as under:
“‘service’ means .......................”
It is in three parts. The main part is followed by inclusive clause
and ends by exclusionary clause. The main clause itself is ve ry
wide. It applies to any service made available to potential users.
The words ‘any’ and ‘potential’ are significant. Both are of wide
amplitude. …….
6. Construction of a house or flat is for the benefit of person for
whom it is constructed. He may do it himself or hire services of
a builder or contractor. The latter being for consid eration is
service as defined in the Act. Similarly when a statutory authority
develops land or allots a site or constructs a house for the benefit
of common man it is as much service as by a builder or
contractor. The one is contractual service and other statutor y
service. If the service is defective or it is not w hat was
represented then it would be unfair trade practice as define d in
the Act. Any defect in construction activity would be denial of
comfort and service to a consumer. When possession of property
is not delivered within stipulated period the delay so caused is
denial of service. Such disputes or claims are not in respect of
immoveable property as argued but deficiency in rendering of
service of particular standard, quality or grade. Such deficiencies
or omissions are defined in sub- clause ( ii) of clause ( r) of
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
Section 2 as unfair trade practice. If a builder of a house us es
substandard material in construction of a building or makes false
or misleading representation about the condition of the house then
it is denial of the facility or benefit of which a consumer is entitled
to claim value under the Act. When the contractor or builder
undertakes to erect a house or flat then it is inherent in it that he
shall perform his obligation as agreed to. A flat with a le aking
roof, or cracking wall or substandard floor is denial of servi ce.
Similarly when a statutory authority undertakes to develop land
and frame housing scheme, it, while performing statutory dut y
renders service to the society in general and indiv idual in
particular. The entire approach of the learned counsel for the
development authority in emphasising that power exercised under
a statute could not be stretched to mean service proceeded on
misconception. It is incorrect understanding of the statutory
functions under a social legislation. A development authority while
developing the land or framing a scheme for housing discharges
statutory duty the purpose and objective of which is servic e to
the citizens. As pointed out earlier the entire purpose of widening
the definitions is to include in it not only day to day buying of
goods by a common man but even such activities which a re
otherwise not commercial but professional or service-oriented in
nature. The provisions in the Acts, namely, Lucknow
Development Act, Delhi Development Act or Bangalore
Development Act clearly provide for preparing plan, development
of land, and framing of scheme etc. Therefore if such authori ty
undertakes to construct building or allot houses or building sites
to citizens of the State either as amenity or as benef it then it
amounts to rendering of service and will be covered in the
expression ‘service made available to potential users’. A person
who applies for allotment of a building site or for a flat constructed
by the development authority or enters into an agreement with a
builder or a contractor is a potential user and nature of transaction
is covered in the expression ‘service of any description’. It further
indicates that the definition is not exhaustive. The inclusive clause
succeeded in widening its scope but not exhausting the services
which could be covered in earlier part. So any service excep t
when it is free of charge or under a constraint of personal service
is included in it. Since housing activity is a service it was covered
in the clause as it stood before 1993.”
135
13. The judgment in Ghaziabad Development Authority v.
Balbir Singh11was in the context of grant of interest at the rate of
18%. Such grant of interest was not interfered with . This Court
approved the judgment in M.K. Gupta and held as under:
“We are in full agreement with what is observed herein. Thus
the law is that the Consumer Protection Act has a wide rea ch
and the Commission has jurisdiction even in cases of service
rendered by statutory and public authorities. Such authoriti es
become liable to compensate for misfeasance in public office i.e.
an act which is oppressive or capricious or arbitrary or negligent
provided loss or injury is suffered by a citizen. T he word
compensation is of a very wide connotation. It may constitut e
actual loss or expected loss and may extend to compensation for
physical, mental or even emotional suffering, insult or injury or
loss.”
14. In Chandigarh Housing Board v. Avtar Singh and Ors. 12,
the Cooperative Housing Societies submitted an application for allotment
of plots advertised by Chandigarh Housing Board. Th e Societies
collected 10% of the tentative price from their members and deposited
the same in a bank specified in the scheme. If any mem ber was to
seek refund, then 10% out of the 25% of the earnest money was to be
deducted. The dispute before the High Court was in respec t of the
direction of 10% of the amount. This Court held as under:
“51. If the final order passed by the High Court is re ad in
conjunction with the interim order dated 11-5-1992, it becomes
clear that the Societies were to deposit the remaining am ount
with interest at the rate of 18% per annum only if they were to
accept allotment of flats under the Scheme. Although, the wr it
petitions were filed by the Societies, the language of the interim
order passed by the High Court shows that the learned Judges
were thinking of imposing liability of 18% interest only on those
members who were to accept allotment of flats to be constructed
by the Societies. The members of the Societies did not get an
opportunity to accept the allotment because even after deposi t
of full earnest money and 18% interest, the Board did not allot
land to the Societies on which they could construct dwelling units/
11 (2004) 5 SCC 65
12 (2010) 10 SCC 194
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
flats. The Finance Secretary misinterpreted the orders of the High
Court and issued wholly arbitrary and unjust directive to the
Board not to refund 18% interest to the members of the Societies
who had applied for refund before allotment of land by the
Board.”
15. In fact, the precise issue as to whether the auction of sites
under the 1973 Rules involves sale of goods or of rendering of service
came up for consideration in UT Chandigarh Administration and
Another v. Amarjeet Singh and Others 13. This Court considered the
judgments of this Court in M.K. Gupta and Balbir Singh. One of the
arguments raised was as under-
“When the auction of sites (for grant of a lease for 99 years )
was in exercise of the power of the Government (the UT
Chandigarh Administration) under the provisions of the
Development Act in accordance with the Leasehold Rules, it
involves neither sale of goods nor rendering of any service. The
act of leasing plots by auction by the appellants therefore did not
result in the successful bidder becoming a “consumer” or t he
appellants becoming “service providers”. In the absence of hiring
or availing of any service, the question of deficiency in ser vice
or unfair or restrictive trade practice with reference to a service,
did not arise and the complaint under the Act was n ot
maintainable.”
16. In respect of the abovementioned question posed, it was held
as under:
“21. With reference to a public auction of existing sites (as
contrasted from sites to be “formed”), the purchaser/les see is
not a consumer, the owner is not a “trader” or “service provider”
and the grievance does not relate to any matter in regard t o
which a complaint can be filed. Therefore, any grievance by the
purchaser/lessee will not give rise to a complaint or c onsumer
dispute and the fora under the Act will not have jurisdiction to
entertain or decide any complaint by the auction-purchaser/lessee
against the owner holding the auction of sites.”
17. The second question was in respect of lack of amenities i.e.,
roads, water supply lines, drainage system, rainwater drainage and
13 (2009) 4 SCC 660
137
electricity etc. This Court held that since the sites wer e put to public
auction, therefore, no grievance regarding amenities could be entertained
as the bidder had the opportunity to verify the sites before participating
in the auction.
18. In the present case, the allotment of residential sites on lease
hold basis for 99 years is not in issue. It has not come on re cord as to
whether such sites were allotted in an auction or by inviting applications.
Even if the site had been allotted after inviting applicati ons, the fact
remains that the respondents claim conversion of such lease hold sites
to free hold sites on payment of the charges which are f ixed by the
Administration. Such conversion was sought in view of the fact t hat
as against the limited right in the lease property for 99 years, the
Administration has decided to grant freehold rights on satis faction of
certain conditions mentioned in the 1996 Rules. The fact is that the
respondents had paid the premium amount as fixed under the 1973
Rules. Now, the claim is for purchase of remaining rights of the Central
Government to convert the site into freehold. The Central Government
continues to be owner of the land until the entire consideration money
together with interest or any other amount is paid to the Central
Government on account of transfer of any site or building or b oth as
provided in Section 3 of the Act. Therefore, the owner i.e., the Central
Government, cannot be said to be a trader or a service pr ovider. The
appellant is not charging any fee for conversion of leasehold property
into freehold property except the amount in accordance with the 1996
Rules, which is part of the sale consideration. It is thus a case of sale
of immovable property on the terms as were fixed in the 1996 Rules.
The amount so fixed under the Rules would form part of the sale
consideration and not a fee or charge levied for providing any kind of
service.
19. In terms of Section 14(1)(e) of the Consumer Act, the District
Forum can inter-alia direct removal of deficiency in the services. The
deficiency in service however does not include the transfe r of title in
favour of the allottee who was earlier granted leasehold rights. As noted
above, appellant is not providing any services within the me aning of
Section 2(1)(o) of the Consumer Act. The expression ‘service’ includes
housing construction and not allotment of a site or a plot.
20. The Consumer fora had taken into consideration a noting in
the ad- ministrative file of the appellant. A noting is however a part of
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
the decision-making process. Such noting does not fructify into an
order unless the same is communicated to the affected person. The
reference may be made to Bachhittar Singh v. State of Punjab 14,
wherein this Court held as under:-
“9. The question, therefore, is whether he did in fact make such
an order. Merely writing something on the file does not amount
to an order. Before something amounts to an order of the St ate
Government two things are necessary. The order has to be
expressed in the name of the Governor as required by clause
(1) of Article 166 and then it has to be communicated. As already
indicated, no formal order modifying the decision of the Revenue
Secretary was ever made. Until such an order is drawn up the
State Government cannot, in our opinion, be regarded as bound
by what was stated in the file. As long as the matter rested with
him the Revenue Minister could well score out his remark s or
minutes on the file and write fresh ones.
10. The business of State is a complicated one and has
necessarily to be conducted through the agency of a large
number of officials and authorities. The Constitution, therefore,
requires and so did the Rules of Business framed by the
Rajpramukh of PEPSU provide, that the action must be taken
by the authority concerned in the name of the Rajpramukh. It is
not till this formality is observed that the action can be regarded
as that of the State or here, by the Rajpramukh. We may further
observe that, constitutionally speaking, the Minister is no more
than an adviser and that the head of the State, the Governo r or
Rajpramukh [Till the abolition of that office by the Amendment
of the Constitution in 1956.], is to act with the aid and advice of
his Council of Ministers. Therefore, until such advice is accepted
by the Governor whatever the Minister or the Counci l of
Ministers may say in regard to a particular matter does not
become the action of the State until the advice of the Council of
Ministers is accepted or deemed to be accepted by the Head of
the State. Indeed, it is possible that after expressing one opinion
about a particular matter at a particular stage a Min ister or the
Council of Ministers may express quite a different opinion, one
which may be completely opposed to the earlier opinion. Which
14 AIR 1963 SC 395
139
of them can be regarded as the “order” of the State
Government? Therefore, to make the opinion amount to a decision
of the Government it must be communicated to the pe rson
concerned. In this connection we may quote the following from
the judgment of this Court in the State of Punjab v. Sodhi
Sukhdev Singh [AIR (1961) SC 493, 512] :
“Mr Gopal Singh attempted to argue that before the final order
was passed the Council of Ministers had decided to accept
the respondent’s representation and to reinstate him, and that,
according to him, the respondent seeks to prove by calling the
two original orders. We are unable to understand th is
argument. Even if the Council of Ministers had provisionally
decided to reinstate the respondent that would not prevent the
Council from reconsidering the matter and coming to a
contrary conclusion later on, until a final decision is reached
by them and is communicated to the Rajpramukh in the form
of advice and acted upon by him by issuing an order in that
behalf to the respondent.”
Thus it is of the essence that the order has to be communic ated
to the person who would be affected by that order before the State
and that person can be bound by that order. For, until the order is
communicated to the person affected by it, it would be ope n to the
Council of Ministers to consider the matter over and over ag ain and,
therefore, till its communication the order cannot be regarded as anything
more than provisional in character.
21. Therefore, the noting by itself cannot be pressed into service
to return a finding of deficiency in service. However, the fact remains
that in terms of 1996 Rules, an amount of Rs.1710/- per sq.mt. was
fixed as conversion charges. The land rates were to be fixed by the
Administration from time to time under Rule 5 of 1996 Rules. In
Annexure-A, the land rate for conversion was fixed at Rs.1710/- per
sq.mt. The same was to be applied for a period of one year . But as
admitted at the Bar, the rates were revised only in 2017. The action of
the appellant in rejecting the request for conversion is thus arbi trary
and discriminatory. The request could not be kept pending when the
statutory Rules were in force. The executive authority could not by an
administrative order keep the matter pending, when there was no other
reason not to accept the conversion except impending increase in the
conversion charges.
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
22. It is the stand of the appellant that no conversion was allowed
after a letter was issued on 10.05.2013. The Admini stration has
however allowed conversion of leasehold properties into freehold even
after the said letter dated 10.05.2013, as conversion of plots bearing
file No. RPL 19565 and RPL 19601, was allowed on 04.12.2013 and
11.11.2013 respectively.
23. Mr. Goel has argued that there cannot be any neg ative
equality as even if some sites have been converted in contravention of
the decision communicated on 10.05.2013, it would not confer any
enforceable right in favour of the allottees. Referenc e was made to
Chandigarh Administration v. Jagjit Singh 15. We do not find any
merit in the argument of Mr. Goel. On the date when the lett er was
issued by the administration on 10.05.2013, the statutory 1996 Rules
were in force. Such Rules were kept in abeyance on the basis of
communication on behalf of the Finance Secretary to the Estate Officer.
Such communication cannot be countenanced. The statutory rules could
not be put to hold because the issue of revision of rates of conversion
was under consideration of the Administration. Even after the said letter
the rates were fixed only in 2017. In the face of valid stat utory Rules,
an administrative decision cannot be sustained.
24. Since the respondents are already in possession of the sites
as lessee on 99 years basis, it cannot be said that the appell ant was
deficient in providing any service, which even if used in a liberal sense
would not include transfer of title in an immovable property. Thus, the
consumer fora under the Act would not have jurisdiction to entertai n
the consumer complaints on the ground of deficiency in service related
to transfer of title of the immovable property.
25. We find that it is not a case of the deficiency in servic e as
contemplated by Consumer Act but definitely a case of exerc ise of
jurisdiction in an arbitrary and discriminatory manner. In exercise of the
power conferred on this Court under Article 142, we direct the
Administration to decide the claim of conversion as on the date when
consumer complaints were filed. Such action shall be take n within 3
months.
26. The difficulty in the Administration is that the senior officers
in the Chandigarh Administration are on deputation from the States of
15 (1995) 1 SCC 745
141
either Punjab or Haryana. The officers revert to their parent cadre
after completion of deputation period of approximately three years.
However, the officials continue to work at the Estate Off ice. Though
the Administration has done commendable work to main tain the
character of Chandigarh as City Beautiful, but the Estate Office has
underbelly, that is, the action of the officials cannot be said to be bona
fide, as is apparent in the present case. It is a typical case of ‘you show
me face, I will show the Rule’. On the other hand, the off icers are
unable to take decisions which are citizen friendly. Even no attempt is
made to remove the bottlenecks in the working of the Estate O ffice.
27. The Division Bench of the High Court of Punjab & Haryana
in a judgment reported as Amritpal Singh v. Chandigarh
Administration 16, has set aside the requirement of no-objection
certificate from the Chandigarh Administration before affecting sale of
freehold properties. The Chandigarh Administration was d irected to
re-examine Rule 17(10) of the 1973 Rules contemplating u nearned
increase, as well the restriction to sell the properties before the expiry
of specific years as the root-cause of malice of Power of Attorneys
sales. Similar rule exists as Rule 7 of Chandi- garh Estate Rules, 2007.
The High Court had issued the following directions:
“(i) That the requirement of ‘No Objection Certificate’ from
the Chandigarh Administration before effecting sale of
the free hold properties is not supported by the Act or
the Rules framed thereunder.
(ii) The Registering Authority is duty bound to examine;
whether the Power of Attorneys are being executed for
consideration. If the Authorities are satisfied that it is
for consideration, the Power of Attorney shall not be
registered unless the proper stamp duty is affixed
thereon.
(iii) If the proper stamp duty is not paid on a Power of
Attorney executed on and after 15.11.2007, the
Registering Authority shall refuse to register the
document on the basis of such attorney at any
subsequent stage unless proper stamp duty is affixed
thereon in accordance with law.
16 2012 SCC OnLine P&H 9310
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
(iv) The Chandigarh Administration may re-examine Rule
17(10) of the 1973 Rules contemplating unearned
increase, as well the restriction to sell the properti es
before the expiry of specific years, as the root-cause
of malice of Power of Attorneys sales.
(v) The Chandigarh Administration to frame Rules to
maintain and update the property records in the manner
mutations are sanctioned in respect of non urban
properties under the Punjab Land Revenue Act, 1887
or such other procedure, which is fair, reasonable and
transparent.”
28. The Full Bench of the High Court in Dheera Singh v. U.T.
Chandigarh Admn. and Ors. 17noticed that the Executive has failed
to live-up to the expectations of the residents as instead of approaching
the concerned Ministry with a concrete proposal on data-based
information for onward consideration of the Legislature to re juvenate
the 1952 Act and make it more vibrant and alive to the issues in
presentia or in future, it has gone for ad-hoc solutions by taking refuge
under Section 22 of the Act. The Court held as under:
“102. Having held that, we cannot refrain from observing th at
the 1952 Act may need revamping and updation to meet th e
modern day challenges some of which are incidental to the steep
hike in the value of real estate and an unprecedented pres sure
of population mounted on Chandigarh. We are cognizant of the
fact that the issue whether or not the 1952 Act is in nee d of
suitable amendments falls exclusively within the domain of
law-makers as the Courts would ordinarily expound the law and
refrain from legislating except in a case of casus o missus.
However, it cannot be overlooked that after enacting a bil l the
Legislature becomes functus officio so far as that p articular
Statute is concerned. The Legislature may not have a mechanism
of its own to keep track of the deficiencies or difficult ies faced
by the executive who has been assigned the duty to give effe ct
to the enactment and achieve the legislative object(s). I t is the
Executive, therefore, who has an onerous duty to apprise, suggest
and put up before the Legislature a proposal along wit h facts
and figures justifying the changes that may be brought into an
17 2012 SCC Online P&H 21473
143
enactment. Thereafter, it is the absolute and non-just iciable
prerogative of the Legislature to take a decision on such proposal
as per its wisdom.
103. The Executive has in the instant case, with reference t o
the 1952 Act, failed to live-up to the expectations of the residents
as instead of approaching the Ministry concerned with a concrete
proposal on data-based information for onward consideration of
the Legislature to rejuvenate the 1952 Act and make it more
vibrant and alive to the issues in prasentia or in future, it has gone
for ad hoc solutions taking refuge under Section 22 of the Ac t.
Strangely, the amount of penalty or fine fixed by the Legislature
in the year 1952 (Sections 8, 13 & 15) has not been got revised
even after the expiry of 60 years.
107. In the light of the interpretation given by us to some of
the provisions of the 1952 Act in paragraphs 81, 82, 84 to 87,
102, 103 & 105 of this order, we also deem it appropriate to issue
the following directions:
(iii) The Union Territory of Chandigarh through its Administrator
shall take steps as may be necessary for updation of the 19 52
Act in the light of the observations made by us in paragr aphs
102, 103 & 105 of this order before March 31, 2013.”
29. But nothing appears to have been done either in terms of
Amritpal Singh or Dheera Singh. Dheera Singh has laid down the
process of exercising the power of resumption. However, ma ny cases
of alleged misuse have been initiated but not concluded by the Estate
Office. The residents of Chandigarh are widely harassed while seeking
no-objection certificate for sale of leasehold property as the procedure
for grant of no-objection certificate and of deposit of unearned increase
is interpreted in different manners by the different officials, which the
officers of the Administration has failed to control. Another are a of
concern is the unreasonable procedure adopted by the Administr ation
for affecting mutation after the demise of the leaseholder or the allottee
and of completing other formalities at the offices of the appellant. The
difficult and near impossible procedure leads to ar bitrary and
discriminatory action by the officials of the Estate Offic e. Therefore,
we direct Administration to constitute a Committee which may include
a Member of Parliament; an architect; an advocate, w ho is or has
represented Chandigarh Administration before the High Cour t; two
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]
representatives of the Municipal Corporation being representatives of
the citizens of Chandigarh, apart from such officer s which the
Administration may think fit, so as to review and s treamline the
processes of sanction of mutation, grant of occupanc y certificate,
no-objection certificate and other citizen-centric requirements including
calculation of unearned profit under the 1973 Rules or under 2007 Rules.
30. In view of the above, the present appeals are disposed of
with the following directions:
a) The appeals are allowed and the orders passed by the
DCDRF, SCDRC and the NCDRC are set aside. The
Administration shall decide the claim of conversion of
allottees as on the date when the consumer complaints
were filed. Such action shall be taken within 3 months;
b) The Administration to give details of the notices for
resumption on account of alleged misuse which are
pending consideration. Such details to include the date
of serving of notice of the alleged misuse and the stage
of proceedings pending before the different officers of
Administration. A report to be submitted by the
Administration thereafter in respect of the above
directions within 4 months for perusal and the necessary
action, if so warranted, after four months.
c) To constitute a Committee which may include inter-alia
the Member of Parliament from Chandigarh, an
architect, an advocate who is or had represented
Chandigarh Administration before the High Court, two
representatives of the Municipal Corporation and the
officers of Administration.
d) Such abovementioned Committee shall submit report to
the Administrator, Chandigarh Administration preferably
within three months. We hope that the learned
Administrator will take appropriate steps to implement
the suggestions made by the Committee including
forwarding of the proposed amendments in the Statute
to the Ministry of Home Affairs, if any, suggested by
the Committee.
145
31. List after 4 months for the Action Taken Report in respe ct
of directions (b), (c) and (d).
Bibhuti Bhushan Bose Appeals disposed of.
ESTATE OFFICER AND ANR. v. CHARANJIT KAUR
[HEMANT GUPTA, J.]