Supreme Court Upholds Cancellation of Plot Allotment Due to False Affidavit: New Okhla Industrial Development Authority vs. Ravindra Kumar Singhvi (2022)

Date of the Judgment: 15 February 2022
Citation: Civil Appeal No. 382 of 2012
Judges: Hemant Gupta, J. and V. Ramasubramanian, J.
Can a government authority cancel a plot allotment if the allottee provided false information? The Supreme Court of India recently addressed this question in a case concerning the New Okhla Industrial Development Authority (NOIDA). The court upheld the cancellation of a plot allotment, emphasizing that false statements in affidavits undermine the integrity of the allotment process. This judgment underscores the importance of truthful declarations in dealings with government bodies and the consequences of providing false information. The judgment was delivered by a two-judge bench of Justices Hemant Gupta and V. Ramasubramanian, with Justice Hemant Gupta authoring the opinion.

Case Background

The case revolves around the allotment of two residential plots in Noida. The respondent, Ravindra Kumar Singhvi, was initially allotted a plot (Sector 30 Plot) on 06.10.1981 as a member of the Defence Services Cooperative Housing Society. Prior to this, on 10.03.1981, a plot (Sector 15A Plot) was allotted to his wife, Smt. Amila Singhvi. According to the respondent, the Sector 15A plot was applied for due to uncertainty arising from litigation involving the Society. The respondent’s wife later transferred the Sector 15A plot to Mrs. Kanta Modi on 25.10.1990 after obtaining permission from the appellant authority. The New Okhla Industrial Development Authority (NOIDA) issued a notice to the respondent on 12.06.1996, stating that the Sector 30 plot was obtained by submitting a false affidavit, as the Sector 15A plot was already allotted to his wife. The respondent filed a suit seeking a declaration to prevent the appellant from re-allocating the Sector 30 plot. The appellant subsequently cancelled the plot on 18.10.1996.

Timeline

Course of Proceedings

The Trial Court decreed the suit in favor of the plaintiff, stating that the lease could not be terminated without a notice under Section 111(g) of the Transfer of Property Act, 1887. The First Appellate Court and the High Court affirmed the Trial Court’s findings. The High Court also held that the plaintiff and his wife did not have any ulterior motive to commit fraud. The appellant, NOIDA, then appealed to the Supreme Court.

Legal Framework

The judgment references the following legal provisions:

• Section 111(g) of the Transfer of Property Act, 1887: This section deals with the determination of a lease. The Trial Court had held that the lease could not be determined without a notice under this section.
• Section 14 of the Uttar Pradesh Industrial Development Act, 1976: This section empowers the Chief Executive Officer to resume a site or building in case of non-payment or breach of conditions.
• The General Clauses Act, 1897: Section 3(3) defines “affidavit” to include affirmation and declaration.
• The Oaths Act, 1969: Section 3(2) deals with the attestation of affidavits.

The Court also considered the terms and conditions of the allotment, specifically:

• Eligibility: A person owning a plot/house in Delhi, New Delhi, or Noida, or whose spouse or dependent children own such property, is not eligible for allotment.
• Not More Than One Plot: An eligible person will be allotted not more than one residential plot.
• Cancellation of Lease: If the allotment is obtained by misrepresentation, misstatement, or fraud, the lease may be cancelled.

Arguments

Appellant (NOIDA)’s Arguments:

• The allotment was cancelled because the respondent submitted false affidavits, concealing the fact that his wife already possessed a plot.
• The respondent and his wife were aware of the condition that a family could not retain two plots.
• The sale of the Sector 15A plot was an attempt to conceal the double allotment.
• The terms and conditions of the allotment clearly stated that a person or their spouse/dependent children owning a plot in Delhi, New Delhi, or Noida was ineligible for another allotment.
• The cancellation was not due to a breach of lease terms but due to the fraudulent means of obtaining the allotment.

Respondent (Ravindra Kumar Singhvi)’s Arguments:

• The terms and conditions of the sale of developed leasehold rights were not produced on record.
• The Sector 15A plot was sought due to pending disputes, and it was later transferred after the settlement of the dispute.
• The respondent was allotted the Sector 30 plot as a member of the Society after the settlement.
• The Chief Executive Officer alone has the power to resume the plot under Section 14 of the Uttar Pradesh Industrial Development Act, 1976.
• The determination of lease should be the last resort.
• The High Court did not interfere with the findings of fact recorded by the lower courts.

Innovativeness of the argument: The appellant argued that the cancellation was not due to a breach of lease terms but due to the fraudulent means of obtaining the allotment. This was a novel argument as the lower courts had focused on the lease terms and the requirement of notice under Section 111(g) of the Transfer of Property Act, 1887.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section. However, the core issue addressed by the court was:

1. Whether the cancellation of the allotment of the Sector 30 plot was justified, given that the allottee had submitted a false affidavit?

Additionally, the court also dealt with the sub-issue of whether the cancellation required the permission of the Chief Executive Officer under Section 14 of the Uttar Pradesh Industrial Development Act, 1976.

Treatment of the Issue by the Court

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

Authorities

The Supreme Court considered the following authorities:

Judgment

The Supreme Court allowed the appeal, setting aside the judgments of the lower courts and dismissing the suit. The Court held that the respondent had obtained the allotment of the Sector 30 plot by submitting false affidavits, which was a legitimate ground for cancellation. The Court also held that the requirement of the Chief Executive Officer’s permission was not applicable in cases of fraud and that the permission was granted by the Chief Executive Officer on 13.09.1998, thus curing any irregularity.

How each authority was viewed by the Court?

• M. Veerabhadra Rao vs. Tek Chand [1984(Supp) SCC 571]: The Court relied on this case to emphasize the importance of affidavits as solemn statements made under oath.
• S.P. Chengalvaraya Naidu (Dead) by LRs. v. Jagannath (Dead) by LRs. & Ors. [(1994) 1 SCC 1]: The Court cited this case to reiterate that fraud vitiates all actions.
• ITC Limited v. State of Uttar Pradesh & Ors. [(2011) 7 SCC 493]: The Court distinguished this case, stating that it dealt with a different issue of cancellation of lease due to breach of lease terms and not fraud.
• Teri Oat Estates (P) Ltd. v. U.T., Chandigarh & Ors. [(2004) 2 SCC 130] and Managing Director, Haryana State Industrial Development Corporation & Ors. v. Hari Om Enterprises & Anr. [(2009) 16 SCC 208]: The Court distinguished these cases, stating that they dealt with the Doctrine of Proportionality, which was not applicable to the present case.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the fact that the respondent and his wife had submitted false affidavits to obtain the allotment of the Sector 30 plot. The Court emphasized that such fraudulent actions undermine the integrity of the allotment process and that a person who misleads the authority is not entitled to any relief. The Court also noted that the respondent’s actions were a clear violation of the terms and conditions of the allotment, which explicitly stated that a person or their spouse/dependent children owning a plot in Delhi, New Delhi, or Noida was ineligible for another allotment. The Court also highlighted the fact that the respondent’s wife had sworn a false affidavit stating that neither she nor her spouse owned any other plot in Noida, while the Sector 30 plot was already allotted to the respondent. The Court further noted that the respondent also submitted a false affidavit stating that he, his spouse, and dependent children did not own any residential plot in Noida, Delhi, or New Delhi.

Logical Reasoning:

The Court rejected the argument that the lease was required to be determined by the Chief Executive Officer, stating that the requirement was not applicable in cases of fraud. The Court also rejected the argument that the determination of lease should be the last resort, stating that the principle of proportionality was not applicable in this case as the allotment was obtained fraudulently.

The Court’s reasoning was based on the following:

• The respondent and his wife had submitted false affidavits.
• The terms and conditions of the allotment were violated.
• Fraud vitiates all actions.
• The Chief Executive Officer’s permission was not required for cancellation due to fraud.

The Court quoted from the judgment:

• “The essential ingredients of an affidavit are that the statements or declarations are made by the deponent relevant to the subject matter and in order to add sanctity to it, he swears or affirms the truth of the statements made in the presence of a person who in law is authorised either to administer oath or to accept the affirmation……”
• “The High Court, in our view, fell into patent error. The short question before the High Court was whether in the facts and circumstances of this case, Jagannath obtained the preliminary decree by playing fraud on the court.”
• “We have no hesitation to say that a person, who’s case is based on falsehood, has no right to approach the court. He can be summarily thrown out at any stage of the litigation.”

There were no dissenting opinions in this case.

Key Takeaways

• Submitting false affidavits can lead to the cancellation of an allotment.
• Government authorities can cancel allotments obtained through fraudulent means.
• It is important to be truthful in all dealings with government authorities.
• The Chief Executive Officer’s permission is not required for cancellation due to fraud.

Directions

No specific directions were given by the Supreme Court in this case.

Specific Amendments Analysis

There is no discussion of any specific amendments in this judgment.

Development of Law

The ratio decidendi of this case is that an allotment of a plot obtained by submitting false affidavits can be cancelled by the government authority. This judgment reinforces the principle that fraud vitiates all actions and that a person who misleads the authority is not entitled to any relief. There is no change in the previous position of the law, but the judgment clarifies that the requirement of the Chief Executive Officer’s permission is not a prerequisite for cancellation in cases of fraud.

Conclusion

The Supreme Court’s decision in this case underscores the importance of truthful declarations in dealings with government bodies. The Court held that the respondent’s actions were fraudulent and that he was not entitled to any relief. The judgment reinforces the principle that fraud vitiates all actions and that a person who misleads the authority is not entitled to any relief. This case serves as a reminder that submitting false information can have serious consequences.