Town Planning: Licence for development of group housing colony – Policy of State to grant licence on ‘First Come First Serve’ basis – Held: The principle of ‘First Come First Serve’ basis adopted by the State Respondents is neither rational nor in public interest and is in violation of Art. 14 of the Constitution – Haryana Development and Regulation Urban Areas Act, 1975 – Haryana Development and Regulation of Urban Areas Rules, 1976 – Constitution of India – Art. 14.
Dismissing the appeal, the Court
HELD: 1. The undisputed facts which have emerged from the record are that neither in the public notice dated 1st October, 2010 which came to be published on 4th October, 2010, nor in the Final Development Plan dated 24 th May, 2011, nor in policy instructions which came to be circulated by the Respondents at a later stage on 5th July, 2012, regarding receipt and validity of the applications for grant of licence, of which a detailed reference has been made, nowhere prescribes that the method of allotment of licence shall be made on First Come First Serve basis and from where this practice had been borrowed/adopted by the Respondent/State authorities is alien to the Scheme of the 1975 Act or the 1976 Rules framed thereunder, nor any material in support thereof has been placed on record. [Para 30][1033-G-H; 1034-A-B]
2. The term “established practice” refers to a regular, consistent, predictable and certain conduct, process or activity of the decision-making authority and being the State functionary, its character is supposed to be based on the requirement of higher degree of fairness in administrative action to be tested on the anvil of Article 14 of the Constitution. [Para 33][1034-G-H]
3. The very foundation on which the process was initiated, inviting applications pursuant to the public notice dated 4 th October, 2010, on the principle of First Come First Serve basis is completely silent/missing from records and how that becomes an established practice in entertaining applications for grant of allotment of licence under the policy of the State Government dated 19th December, 2006, pursuant to which the public notice came to be published on 4th October, 2010 with a clarification being made of the policy of the Government dated 5th July, 2012 is alien to the records and it was never made known to the public as to the mechanism the Government intended to adopt for grant of licence to the prospective applicants. [Para 34][1035-A-B]
4. Although this factor cannot be ruled out that those who are interested parties, they were aware of this so-called alleged practice of First Come First Serve adopted in the office of the State Respondent and that was the reason for which even before the public notice dated 1st October, 2010 came to be published on 4th October, 2010, people start running for submitting their applications as if they are participating in the mad race, without being known to the people at large about the policy according to which the applications are invited for grant of licence to the prospective applicants which is a sine qua non for good governance. [Para 35][1035-C-D]
5. That apart, there is a fundamental flaw in the policy of the State of First Come First Serve basis as it involves an element of pure chance or accident and it indeed has inherent in-built implications and this factor cannot be ruled out as any person who has an access to the power corridors will be made available with an information from the Government records and before there could be a public notice accessible to the people at large, the interested person may submit his application, as happened in the instant case, and become entitled to stand first included in queue to have a better claim, at the same time it is the solemn duty of the State to ensure that a non-discriminatory method is adopted, whether it is for distribution or allotment of licence on his own land, or alienation of property and it is imperative and of paramount consideration that every action of the State should always be in public interest. [Para 36][1035-E-G]
6. In the matter of grant of licence even on its own land to set up a group housing society, the policy of allotment must be fair and transparent and as there is a cap of 20% for group housing society in the sector area and if the demand exceeds more than available density of 20% area reserved for group housing in the sector alike Sector 63A, Gurgaon under the Final Development Plans as published in the instant case, the method of selection has to be such so that all the eligible applicants get a fair opportunity of competition and it is the bounden duty of the State and its instrumentalities of their action to be conformed with Article 14 of the Constitution of which non-arbitrariness is a significant facet. A public authority possesses powers only to use them for public good. This imposes a solemn duty on the State to act impartially and to adopt a procedure of allotment of licence which is fair play in action. In the first instance there is no such consistent practice as alleged of First Come First Serve basis for allotment of licence available under the entire Scheme placed on record and secondly, from where this principle has been borrowed is alien to the statute and also the policy pursuant to which the process was initiated for allotment of licences to the prospective applicants. [Paras 37, 38][1035-G-H; 1036-A-C]
7. The principle of First Come First Serve basis which has been adopted by the State Respondents in the facts of the instant case is neither held to be rational nor in public interest and is in violation of Article 14 of the Constitution of India. [Para 40][1037-G]
Centre for Public Litigation & Ors. v. Union of India & Ors. (2012) 3 SCC 1 : [2012] 3 SCR 147 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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