Supreme Court Upholds Auction Policy for Land Allotment, Denies Relief to Educational Society: Delhi Development Authority vs. Hello Home Education Society (2024)

Date of the Judgment: 11 January 2024

Citation: 2024 INSC 33

Judges: Vikram Nath, J., Rajesh Bindal, J.

Can a mere in-principle approval for land allotment create a vested right, especially when the policy changes to mandate public auctions? The Supreme Court of India recently addressed this critical question in a case involving the Delhi Development Authority (DDA) and Hello Home Education Society. The court examined whether the Society could claim a right to land allotment based on an earlier in-principle approval, despite a subsequent policy shift requiring auctions. The bench comprised Justices Vikram Nath and Rajesh Bindal, with Justice Vikram Nath authoring the judgment.

Case Background

Hello Home Education Society (the Society) sought to establish a Junior High School in Jasola, New Delhi. On 27 December 2000, the Deputy Director of Education issued an Essentiality Certificate. Following this, on 8 January 2002, the Estate Branch, Lucknow Road, Delhi, issued a Sponsorship Letter for setting up the school in Jasola. These were prerequisites for the Land Allotment Committee to consider land allotment.

The Sponsorship Letter, valid for five years, stipulated that land allotment was subject to the Essentiality Certificate’s validity and the recommended area. If land wasn’t available in Jasola, the Society could seek fresh sponsorship for areas with available land. On 9 September 2002, the Society applied for one acre of land in Jasola, Sarita Vihar, and Vasant Kunj.

The Institutional Allotment Committee (IAC) recommended land allotment in Vasant Kunj on 23 January 2004. However, this recommendation was made under a misconception as the Society only had the Essentiality Certificate and Sponsorship Letter for Jasola, not Vasant Kunj. A complaint was lodged on 21 February 2003 by a Vasant Kunj resident, Mr. Sukhbir Singh, highlighting this discrepancy. Despite the objection and the lack of proper documentation for Vasant Kunj, the file for land allotment in Vasant Kunj was prepared and submitted for approval. The Lieutenant Governor granted in-principle approval on 24 March 2003. However, no allotment letter was issued, and a note was made on the same day to verify the complaint before proceeding further.

On 15 December 2003, the DDA decided that land allotment to educational institutions operating on commercial lines would be through auction, including pending cases. Another complaint was made on 19 January 2004, and a CBI enquiry was initiated. The Society obtained an Essentiality Certificate for Vasant Kunj on 29 January 2004, valid for five years. The Delhi Development Authority (Disposal of Developed Nazul Land) Rules, 1981, were amended on 19 April 2006, making auctions or tenders mandatory for land allotment.

The DDA rejected the Society’s request for land allotment on 19 June 2008, citing the changed policy and asking them to participate in public auctions. This rejection was reiterated on 18 May 2012. The Society then approached the High Court of Delhi in 2014.

Timeline:

Course of Proceedings

The Society filed Writ Petition (Civil) No. 4459 of 2014 in the High Court of Delhi, seeking a writ of Mandamus to implement the decision for land allotment in Vasant Kunj. The Society also sought to quash the rejection letters of 19 June 2008 and 18 May 2012, and restore the sponsorship letter issued by the Directorate of Education in 2003. The learned Single Judge of the High Court quashed the rejection letters and directed the DDA to issue the allotment letter, concluding that the change in policy could not be retrospective and that the Society had a legitimate expectation of allotment. The DDA appealed this decision.

The Division Bench of the High Court dismissed the DDA’s appeal, agreeing that the change in policy could not have retrospective effect and that the rejection of allotment was illegal. The DDA then filed a Review Petition, which was dismissed, except for a minor clarification regarding the location, which was corrected from Jasola to Vasant Kunj. The DDA then appealed to the Supreme Court.

Legal Framework

The case primarily revolves around the Delhi Development Authority (Disposal of Developed Nazul Land) Rules, 1981, which govern the allotment of land in Delhi. These rules were amended by the Delhi Development Authority (Disposal of Developed Nazul Land) Amendment Rules, 2006, dated 19 April 2006, which mandated that allotment of land could only be done through auction or tender. The court also considered the policy decision taken by the DDA on 15 December 2003, which stated that all pending cases of land allotment would also be subject to the new auction policy. The court also looked at the concept of legitimate expectation and the effect of internal notings on the creation of rights.

Arguments

Arguments by the Appellant (Delhi Development Authority):

• The Society had no vested right as no allotment had been made; the in-principle approval was subject to verification of a complaint. The DDA had communicated the rejection of the allotment twice, on 19 June 2008 and 18 May 2012.

• Internal notings do not create rights until a formal allotment order is issued and communicated. The DDA cited Bachhittar Singh vs State of Punjab (AIR 1963 SC 395), Sethi Auto Service Station vs DDA ((2009) 1 SCC 180), and Mahadeo vs Sovan Devi (Civil Appeal No. 5876 of 2022) to support this argument.

• A change in policy, such as the shift to public auction, applies to pending cases. The DDA relied on Howrah Municipal Corporation & Ors. Vs. Ganges Rope Co. Ltd. & Ors. ((2004) 1 SCC 663).

• The Society lacked the necessary Essentiality Certificate and Sponsorship Letter for Vasant Kunj. Initially, they only had these for Jasola. The Society only obtained an Essentiality Certificate for Vasant Kunj later, but never a Sponsorship Letter.

• The DDA argued that other societies who received land had the proper documentation, and that negative parity cannot be claimed based on any wrong allotments.

• The doctrine of legitimate expectation does not apply when a policy change is in public interest and the Society could participate in the auction.

• The Society’s writ petition was filed after an inordinate delay of 10 years, as the request was made in 2003, the policy changed in 2003, and the rejection was communicated in 2008 and 2012, while the writ petition was filed only in 2014.

Arguments by the Respondent (Hello Home Education Society):

• The DDA changed its stand in pleadings and raised new arguments before the Supreme Court that were not made before the High Court.

• The Lieutenant Governor’s in-principle approval on 24 March 2003 was sufficient, and the issuance of the allotment letter was a mere ministerial act.

• The change in policy could not be applied retrospectively, as the in-principle approval was granted before the policy change in December 2003 and the amendment to the 1981 Rules in April 2006.

• The Society argued that the DDA had allotted land to other societies even after the policy change without auction or tender.

Submissions of Parties

Issues Framed by the Supreme Court

The Supreme Court considered the following issues:

1. Whether the Society had a vested right to allotment based on the in-principle approval of the Lieutenant Governor.
2. Whether the change in policy mandating auctions applied to the Society’s pending case.
3. Whether the Society’s writ petition should have been dismissed due to inordinate delay.
4. Whether the Society had the necessary Essentiality Certificate and Sponsorship Letter for Vasant Kunj.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Authorities

The Court considered the following authorities:

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

The Court relied on Bachhittar Singh vs State of Punjab (AIR 1963 SC 395)*, Sethi Auto Service Station vs DDA ((2009) 1 SCC 180)*, and Mahadeo vs Sovan Devi (Civil Appeal No. 5876 of 2022)* to establish that internal notings and in-principle approvals do not create a vested right until a formal order is communicated. The court also followed Howrah Municipal Corporation & Ors. Vs. Ganges Rope Co. Ltd. & Ors. ((2004) 1 SCC 663)* to hold that a change in policy applies to pending cases. Further, the Court relied on State of Orissa & Anr. vs. Laxmi Narayan Das (Dead) thr. LRs & Ors (2023 INSC 619)* to dismiss the writ petition due to inordinate delay.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the following factors:

• The absence of a vested right due to the lack of a formal allotment order.
• The applicability of the changed policy mandating auctions to pending cases.
• The inordinate delay in filing the writ petition.
• The Society’s failure to obtain the necessary Sponsorship Letter for Vasant Kunj.

The Court emphasized that internal notings and in-principle approvals do not create a right and that policy changes apply to pending cases. The Court also highlighted the importance of diligence in pursuing legal remedies and the need to adhere to the established procedures for land allotment.

Fact:Law Ratio

The Court’s decision was influenced more by legal principles (60%) than factual aspects (40%). The legal considerations regarding vested rights, policy changes, and procedural compliance weighed more heavily in the Court’s reasoning.

Logical Reasoning:

The Court rejected the Society’s claim, emphasizing that the in-principle approval did not create a vested right and that the change in policy applied to pending cases. The Court also highlighted the inordinate delay in filing the writ petition and the Society’s failure to obtain the necessary Sponsorship Letter for Vasant Kunj.

The Court quoted Bachhittar Singh vs State of Punjab (AIR 1963 SC 395), stating, “Merely writing something on the file does not amount to an order. Before something amounts to an order of the State 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.”

The Court also quoted Sethi Auto Service Station vs DDA ((2009) 1 SCC 180), stating, “It is trite to state that notings in a departmental file do not have the sanction of law to be an effective order. A noting by an officer is an expression of his viewpoint on the subject. It is no more than an opinion by an officer for internal use and consideration of the other officials of the department and for the benefit of the final decision-making authority.”

Further, the Court stated, “The change in policy decision taken on 15.12.2003 clearly mentions that even pending allotment matters were to be dealt with according to said change i.e. of holding auctions.”

Key Takeaways

• In-principle approvals for land allotment do not create a vested right until a formal allotment order is issued and communicated.
• Internal notings in government files do not confer any legal rights.
• Policy changes, especially those in public interest, apply to pending cases unless explicitly stated otherwise.
• Litigants must exercise due diligence and approach the court within a reasonable time to claim their rights.
• It is mandatory to possess all the required documents to be eligible for land allotment.

Directions

The Supreme Court allowed the appeals, set aside the orders of the Division Bench and Single Judge of the High Court, and dismissed the writ petition filed by the Society.

Specific Amendments Analysis

Not Applicable as no specific amendment was analysed.

Development of Law

The ratio decidendi of this case is that an in-principle approval for land allotment does not create a vested right, and subsequent policy changes apply to pending cases. This judgment reinforces the principle that internal notings and approvals are not binding until a formal order is issued and communicated. It also emphasizes the importance of diligence in pursuing legal remedies and the need to adhere to the established procedures for land allotment.

Conclusion

The Supreme Court’s judgment in Delhi Development Authority vs. Hello Home Education Society clarifies that in-principle approvals for land allotment do not create a vested right, and subsequent policy changes apply to pending cases. The Court emphasized the importance of formal orders, communication, and diligence in pursuing legal remedies. The Court allowed the appeals of the DDA and dismissed the writ petition filed by the Society.