Partly allowed

M/S Nanjundeshwara Tech Park v. the Karnataka Industrial Areas Development Board

Karnataka HC3 Nov 2023WP/13304/2020

Case brief

AI extract

What is this about?

The High Court quashed the order cancelling a land allotment because it was issued without the mandatory notice and hearing required under Section 34B of the KIAD Act. The writ petition was partly allowed, directing the respondent to consider the petitioner's submissions by complying with the statutory procedure.

What did the court decide?

The impugned order of cancellation of allotment of Plot No.166 is quashed, and the respondent is directed to consider the petitioner's reply and representation by complying with the procedure under Se

M/S Nanjundeshwara Tech Park Vs the Karnataka… — Landlord and Tenant | Karnataka HC (2023)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 3^RD DAY OF NOVEMBER, 2023

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BEFORE

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THE HON’BLE MR. JUSTICE K. V. ARAVIND

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WRIT PETITION NO.13304/2020 (GM-KIADB)

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BETWEEN:

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M/S NANJUNDESHWARA TECH PARK, A SOLE PROPRIETORSHIP CONCERN REPRESENTED BY ITS SOLE PROPRIETOR, K.R. NAGENDRA, HAVING PRINCIPAL PLACE OF BUSINESS AT SHANKAR INDUSTRIES, SANTHEPET, ARASIKERE-573 103.

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...PETITIONER

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(BY SRI SAMMITH S., ADVOCATE)

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AND:

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THE KARNATAKA INDUSTRIAL AREAS DEVELOPMENT BOARD, REPRESENTED BY ITS CHIEF EXECUTIVE OFFICER, NO.49, 4^TH AND 5^TH FLOORS, EAST WING, KHANIJA BHAVAN, RACE COURSE ROAD, BENGALURU-560 001.

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…RESPONDENT

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(BY SRI S.L. PRADEEP KUMAR, ADVOCATE)

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THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTUION OF INDIA PRAYING TO QUASH THE IMPUGNED NOTICE ISSUED BY THE RESPONDENT DATED 17.3.2020 AS CONTAINED IN ANNEXURE-M. DIRECT THE RESPONDENT TO CONSIDER THE REPLY AND REPRESENTATION OF THE PETITIONER AT ANNEXURES L AND N, FAVOURABLY AND PURSUANTLY, EXECUTE THE LEASE-CUM-SALE AGREEMENT AND ANY OTHER LEGAL DOCUMENTS AS MAY BE REQUIRED IN FAVOUR OF THE PETITIONER ETC.

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THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED FOR ORDERS ON 30.10.2023, THIS DAY THE COURT PRONOUNCED THE FOLLOWING:

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ORDER

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The petitioner has preferred this writ petition seeking

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to quash the notice issued by the respondent bearing No.KIADB/HO/Allot/Secy.-I/19729/17922/19-20, dated 17.03.2020 at Annexure-M and seeking mandamus to consider the reply and representation at Annexures-L and N, dated 12.09.2019 and 15.05.2020 respectively.

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The petitioner is a sole proprietorship concern carrying on business under the name and style M/s.Najundeshwara Tech Park, engaged in the business of constructing IT/BT buildings and establishing software parks. The petitioner was allotted two acres of land in

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Bengaluru I.T. Park, near Devanahalli International Airport, subject to deposit of certain sums as stated in the letter dated 18.10.2011. The petitioner has made deposits in terms of receipts produced as Annexure-B, B1 to B9, dated starting from 25.03.2011 to 29.06.2015.

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The petitioner was issued allotment letter dated 24.01.2013 by allotting plot No.166 of Bengaluru I.T. Park by the respondent indicating the amount to be deposited as a tentative price as reflected in Annexure-C. The petitioner was also issued confirmatory letter of allotment by the respondent dated 30.07.2015, which would reflect acknowledgment of receipt of 100% of the land cost. The petitioner was further advised to take over the possession of the land within one month from receipt of the letter dated 30.07.2015. The respondent issued a letter to the petitioner dated 28.10.2015 requesting the petitioner to obtain the possession certificate by contacting the concerned official of the respondent. The petitioner vide letter at Annexure-F by expressing the reasons for delay in

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obtaining the possession certificate requested for extension of time. Possession certificate was issued by the respondent in favour of the petitioner on 18.01.2018. By letter dated 18.06.2018, the petitioner was requested by the respondent to prepare the agreement papers and the draft deed for 10 years lease in relation to plot No.166, HiTech, Defence and Aerospace Park (I.T. Sector), Industrial Area, Bengaluru Urban District was issued. The petitioner by letter dated 12.09.2019 requested execution of the lease deed on the ground of ill-health of the proprietor of the petitioner.

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The respondent by Annexure-M, dated 17.03.2020 has proceeded to cancel the allotment for non-adherence of time schedule of terms and conditions of allotment.

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Learned counsel for the petitioner would submit that the payments as required in the allotment letter have been complied with and only delay was in executing the leasecum-sale agreement which would not lead to violation of terms and conditions of allotment. It is further submitted

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that in view of the allotment letter and possession certificate, the respondent is required to follow the procedure as prescribed in Section 34B of the Karnataka Industrial Areas Development Act, 1966 (hereinafter referred to as 'KIAD Act' for short). In terms of Section 34B of the KIAD Act, neither notice is issued nor an opportunity of personal hearing provided. Hence, the order of cancellation of allotment is in violation of principles of natural justice.

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Learned counsel for the petitioner in support of the above contention relied on the judgment of this Court in W.P.No.17059/2014 and W.P.No.19122/2014 (M/s. Bharath Oil & Gas Corporation Ltd., vs. The Chief Executive Officer & Executive Member, KIADB, Bengaluru and another), dated 19.08.2015, to contend that procedure prescribed in Section 34B of the KIAD Act is required to be followed.

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Learned counsel for the respondent by referring to the terms and conditions of the allotment letter dated

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24.01.2013 would submit that payment of Rs.2,87,99,500/- has not been deposited on or before 22.07.2013. It is further submitted that in view of leasecum-sale deed not being executed, procedure prescribed under Section 34B of the KIAD Act is not applicable.

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Heard learned counsels for the petitioner and the respondent.

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The respondent has issued an intimation to the petitioner regarding allotment of 2 acres of land in Bengaluru I.T. Park, near Devanahalli Airport, subject to certain deposits. Respondent has issued allotment letter requiring the amount to be deposited by the petitioner. The respondent has issued receipts acknowledging the deposits. The respondent has further issued confirmatory letter of allotment acknowledging receipt of 100% payment towards land cost from the petitioner.

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The petitioner was further issued possession certificate on 18.01.2018. On 18.06.2018, the respondent

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has forwarded draft lease deed to the petitioner. The petitioner has represented and requested for extension of time due to ill-health.

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The respondent by order dated 17.03.2020 has proceeded to cancel the allotment of land by rejecting the request of the petitioner to execute lease-cum-sale agreement for non-adherence of time schedule of terms and conditions of allotment. As seen from the order of cancellation or from the statement of objections filed by the respondent the procedure provided under Section 34B of the KIAD Act being followed is not reflecting. Section 34B of the KIAD Act clearly mandates issuance of notice and opportunity of hearing before cancellation of the allotment. On this ground alone, the impugned order of cancellation of allotment is required to be quashed. The above view is supported by the judgment of this Court in W.P.No.17059/2014 and W.P.No.19122/2014. Hence, the following:

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ORDER

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(i) Writ petition is partly-allowed.

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(ii) Order of cancellation of allotment in respect of Plot No.166 of (I.T. Sector) Hi-Tech, Defence and Aerospace Park, Bengaluru at Annexure-M is hereby quashed.

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(iii) The respondent is directed to consider the reply and representation at Annexures-L and N respectively by due compliance of procedure contemplated under Section 34B of the KIAD Act.

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No order as to costs.

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Sd/JUDGE

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M/S Nanjundeshwara Tech Park v. the Karnataka Industrial Areas Development Board

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M/S Nanjundeshwara Tech Park v. the Karnataka Industrial Areas Development Board

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