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SS Constructions & Another v/s Telangana State Industrial Infrastructure Corporation Ltd., Medchal-Siddipet Zone & Others

    Writ Petition No. 16099 of 2021

    Decided On, 22 June 2022

    At, High Court of for the State of Telangana

    By, THE HONOURABLE MR. JUSTICE A. ABHISHEK REDDY

    For the Petitioners: M/s. L&L Partners Law Offices, Advocates. For the Respondents: R1, L. Prabhakar Reddy, R2, V. Narasimha Goud, R4, Chatla Madhu, Learned Standing Counsels.



Judgment Text

Heard the learned counsel for the petitioners, Sri L. Prabhakar Reddy, learned Standing Counsel for TSIIC, for respondent No.1, Sri V.Narasimha Goud, learned Standing Counsel for respondent No.2, and Sri Chatla Madhu, learned Standing Counsel for respondent No.4. With their consent, the Writ Petition is disposed of.

2. This Writ Petition is filed seeking the following reliefs:

“(a) to issue a writ, order or directions in the nature of mandamus directing to set aside the Show Cause Notice Lr.No.ZO/MDCL-SDPT/133/Ph.11/96/4241, dated 22.09.2020;

(b) to direct respondent No.1 to pay a compensation of Rs.1 crore for the loss caused due to stoppage of work, for demolition of parts of the building and causing reputational loss; and

(c) to pass such other order (s) as this Hon’ble Court may deem fit and proper in the facts and circumstances of the case.”

3. The facts that necessary for the purpose of this case are that respondent No.3 herein was allotted land admeasuring 4151 Sq. Yards in Industrial Development Area, Jeedimetla, for the purpose of establishing Industrial Training Institute and a sale deed dated 18.09.1998 was also executed in favour of respondent No.3. As the said area was declared as a residential zone, respondent No.3 could not establish the Training Institute and therefore respondent No.3 got converted the land for residential purpose. After paying necessary conversion charges, development charges and after complying all the required formalities by respondent No.3, respondent No.1 issued noobjection to respondent No.3 for usage of the subject land for group housing purpose. Thereafter, respondent No.3 entered into development agreement with Gowtham Sai Infrastructures, which in turn has entered into an agreement with petitioners for construction of residential complex in pursuance of building permit, dated 08.01.2020, issued by respondent No.4 and accordingly the petitioners have commenced construction. It is the grievance of the petitioners that after the commencement they came to know about issuance of the impugned notice dated 22.09.2020 issued by respondent No.1 to respondent No.3 stating that the subject land allotted to respondent No.3 was cancelled and the land was resumed with immediate effect, on the ground that the subject land was not used for the purpose for which it was allotted. Questioning the same, the present Writ Petition is filed. Learned counsel for the petitioners has relied on the decision of the Hon’ble Supreme Court in Andhra Pradesh Industrial Infrastructure Corporation Limited vs. S.N. Raj Kumar (2018) 6 SCC 410).

4. A counter has been filed by respondent No.1 mainly contending that the writ petitioners herein are not parties to the allotment proceedings between respondent No.1 and respondent No.3 and therefore they have no locus to file the present Writ Petition challenging the impugned cancellation and resumption order. It is further contended that as the allotted land was not utilized for the purpose for which the same was allotted, the impugned orders are passed. Further, the authorities have no knowledge about the agreements took place between the petitioners and the allottees. Respondent No.1 after coming to know the construction activity, has addressed a letter dated 08.07.2021 to the respondent No.4 to withdraw the permissions by bringing to its notice the impugned cancellation proceedings. Hence, it is prayed to dismiss the writ petition.

5. Learned Standing Counsel has relied on Indu Kakkar vs. Haryana State Industrial Development Corporation Ltd. (1999) 2 SCC 37) to contend that the present Writ Petition filed by the petitioners is not maintainable.

6. Heard and perused the material on record.

7. The main issue before this Court is as to ‘whether the Corporation has the power to cancel a registered sale deed unilaterally on its own on the basis of the purported letter, which is impugned in the present writ petition?’.

8. Admittedly, in this case, the Corporation has executed a registered sale deed in favour of respondent No.3 relinquishing all the rights, title and interest in the subject property. Thereafter, the petitioners have entered into the shoes of respondent No.3 by virtue of a Development Agreement. Even though, learned Standing Counsel has vehemently argued that the sale done in favour of respondent No.3 is a conditional one as envisaged in the agreement of sale entered by the parties wherein there is a clause to the effect that the property, which was agreed to be sold, shall be used for the purpose of setting up an Industrial Training Institute and therefore the Corporation has every right to cancel the same if there is any violation of the conditions mentioned in the agreement of sale and the subject sale deed, but, a perusal of the registered sale deed executed in favour of the respondent No.3, the terms and conditions of agreement of sale are not made part and parcel of the registered sale deed nor the registered sale deed is a conditional one. Once the vendor relinquishes his right, title or interest in the property in favour of the purchaser through a registered sale deed, he cannot cancel the said registered sale deed unilaterally and the only remedy available to the vendor is to approach the Civil Court for cancellation of the sale deed but the vendor cannot cancel the registered sale deed on its own that too on the basis of purported letter. Even though, the learned Standing Counsel tried to distinguish the decision relied upon by the petitioner herein, the fact remains that this Court as well as the Hon’ble Supreme Court in a catena of cases have held that the only remedy under the law for getting the registered sale deed cancelled is to approach the Civil Court for cancellation of the same.

9. In Thota Ganga Laxmi vs. Government of Andhra Pradesh (2010) 15 SCC 207), the Hon’ble Supreme Court has held that if any sale deed is required to be cancelled, the only remedy is by way of a civil suit for cancellation, but no cancellation deed can be unilaterally executed or registered. The Hon’ble Supreme Court after referring to Rule 26(i)(k) of the Registration Rules, 1908, held that it is only when the earlier sale deed is cancelled by a competent court can a cancellation deed be registered that too after notice to the concerned parties; and unilateral cancellation of the sale deed, as well as registration thereof, were wholly void, non est and meaningless transactions.

10. Further, the Hon’ble Supreme Court, in S. N. Raj Kumar (supra), at para 17, has held as under:

“Section 35 of the Act deals with rights and liabilities of buyer and seller. As per this provision, when the buyer discharges obligations and seller passes/conveys the ownership of the property, the contract is concluded. Thereafter, the liabilities, obligations and rights, if any, between the buyer and seller would be governed by other provisions of the Contract Act and the Specific Relief Act, on the execution of the sale deed. The seller cannot unilaterally cancel the conveyance or sale.”

11. For the aforementioned reasons and the law laid down by the Hon’ble Supreme Court i

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n the above referred decisions, the present impugned letter, Lr.No.ZO/MDCL-SDPT/133/Ph.11/ 96/4241, dated 22.09.2020, is set aside. Insofar as the 2nd prayer seeking to direct the respondent No.1 to pay compensation is concerned, this Court under Article 226 of the Constitution of India cannot go into the question of compensation without there being any evidence on record. It is only the Civil Court which can decide the same based on the pleadings and the evidence led by the parties. Therefore, this Court is not inclined to grant the same. However, it is left open to the parties to avail the remedies available under the law. 12. Accordingly, the Writ Petition is allowed in part. The miscellaneous petitions pending, if any, shall stand closed. There shall be no order as to costs.
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