Holding

The purchaser is not entitled to the increased floor‑area ratio; the parameters fixed at the auction date under Bye‑law 19.8 govern.

Summary

The State of Rajasthan auctioned a 10,490 sq m plot to H.V. Hotels for a hotel, stipulating a floor‑area ratio (FAR) of 1.0 and requiring surrender of land for road widening. The sale deed allowed the buyer to obtain any additional FAR if permitted by future building bye‑laws. After the Jaipur Development Authority (JDA) promulgated new bye‑laws in 2000 fixing FAR at 1.75, the buyer sought the higher ratio, but the State rejected the claim relying on Bye‑law 19.8, which fixes parameters for auctioned plots at the auction date. The High Court, ignoring Bye‑law 19.8 and the non‑joinder of JDA, directed the State to grant the increased FAR. On appeal, the Supreme Court held that Bye‑law 19.8 controls, the relevant date for auctioned plots is the auction date, and the buyer is not entitled to the higher FAR; estoppel and the power to relax rules do not apply, and the JDA need not be a necessary party. The appeal was allowed and the writ petition dismissed.

Issues considered

The purchaser's entitlement to the increased floor‑area ratio under the 2000 Building Bye‑laws despite Bye‑law 19.8 fixing parameters at the auction date.
Whether the Jaipur Development Authority is a necessary party to the writ petition.
Whether the principle that the relevant date is the plan‑sanction date overrides Bye‑law 19.8.
The applicability of estoppel in the purchaser's claim.
The scope of the State's power to relax building regulations in favor of the purchaser.

Legislation cited

Jaipur Development Authority Acts. 54
Rajasthan Land Revenue Acts. 102A

Subjects

auction salefloor area ratiobuilding bye‑lawsestoppelnecessary partypublic interestrelaxation of building regulationsJaipur Development AuthorityRajasthan

Judgment

A STATE OF RAJASTHAN & ANR.
v.
H.V. HOTELS PVT. LTD. &ANR. -
JANUARY 12, 2007

B [H.K. SEMA AND P.K. BALASUBRAMANYAN, JJ.]

Urban Development-Auction sale of land for construction thereon-
Surrender of certain extent from the land for widening of road-Jn lieu
thereof benefit offloor area ratio given to purchaser as 1.0-Subsequently
\ -
floor area ratio extended to 1. 75 by Building Bye-laws-Demand of
C extended floor area ratio by the purchaser-Rejection thereof-
Challenged-Courts below directing the State to give the benefit of
extended floor area-On appeal, held: The purchaser being the auction
purchaser was not entitled to the benefit of extended floor area ratio in
view of Bye-Law 19.8-Jaipur Development Authority (Jaipur Region)
D Building Bye-Laws 2000-Bye-Law 19.8.

First respondent, purchased a property in auction by the State
Government for the purpose of construction of a hotel. As per the Sale
Deed, out of the total extent, an extent of certain area was required to be
surrendered by the purchaser free of cost for widening of an existing road
E and in lieu of that, purchaser would be given the benefit of the floor area
ratio calculated on the basis of original plot size. Floor area ratio was given
as 1.0. Sale deed also stipulated that consequent to any change in Building
bye-laws framed by the local authorities, if the purchaser got additional
floor area ratio or any relaxation, State would have no objection, provided
the same were permissible by the prevailing bye-laws. In the meantime, new
F
Building Bye-Laws Jaipur Development Authority, Jaipur Region Building
Bye-Laws 2000 were promulgated fixing the floor area ratio as 1.75. State
rejected the claim of the purchaser relying on bye-law 19.8 which stipulated
that for the plots sold in auction, parameters would remain the same as
.>pecified at the time of auction. Respondent challenged the order in Writ
G Petition. Single Judge of High Court allowed the Writ Petition directing
the State to grant benefit of additional floor area ratio to the purchasers.
In Writ appeal, order of Single Judge was upheld by Division Bench of High
Court. Hence the present appeal.

Allowing the appeal, the Court
H
868
STATE v.H.V. HOTELS PVT. LTD. 869

HELD: 1. It may be true that the Building Bye-Laws of2000 fixed a A
floor area ratio as 1.75 in general, but the same could not be applied in the
case of the present purchaser ignoring bye-law 19.8 of the bye-laws for the
plots sold in the auction. Here, the parameters at the time of the auction,
fixed the floor area ratio as 1.0. The effect of bye-law 19.8 is clearly that
the relevant date for fixing the parameters will be the date of auction,
notwithstanding that the new bye-laws might have provided for a higher B
floor area ratio. The effect of bye-law 19.8 cannot get obliterated by the
principle recognized by this Court that normally the relevant date is the
;
date of sanctioning of the plan. Of course, going by that ratio, the bye-
laws applicable may be the bye-laws of 2000. But in cases of plots sold
by auction, the parameters will remain the same as specified at the time C
of auction. [Paras 9 & 10] (874-A-D, 874-A, B, C]

2. The purchaser bid the property in auction knowing fully well, the
conditions of the auction with a view to ~ommercially exploit the site. He
was aware of the parameters. There is no merit in the plea of estoppel

-
sought to be raised. There is also no representation in the sale deed acted D
upon to his detriment by the purchaser on which a plea of estoppel can be
founded. (Para 13] (875-D-E]

3. The power of exemption is not to be exercised freely. The power
to relax a Building Rule, Regulation or requirement is an exception to the
rule and it is to be used with caution and to justify or condone minimum E
bona fide violations or deviations. Merely because subsequently the bye-
laws have been amended, it does not mean that the parameters should be
relaxed in favour of the purchaser. That would be clearly an erroneous
approach to the question of relaxation and assumption of such a power
would mean the nullification of Building rules themselves and the object F
sought to be achieved by the Building rules and the need to have planned
development of cities and towns in the interests of posterity. Therefore,
there is no merit in the plea based on the power to relax contained in the
amended bye-laws. (Para 14) (875-F-H, 876-A]

4. There is nothing inequitable in the purchaser being pinned down G
to his obligation under the sale by auction. Building Regulations are in
public interest. Courts have a duty to protect public interest particularly
when they do not interfere with any of the fundamental rights of the
; purchaser. The plea based on alleged equity canno~ be accepted.
[Para 15) [876-B)
H
870 SUPREME COURT REPORTS (2007] 1 S.C.R.

A 5. The High Court was in error in holding that in the nature of the
reliefs claimed by the writ petitioner, the Jaipur Development Authority
was not a necessary party but was only a proper party. It failed to notice
that the effect of the direction issued by it, is to fetter the statutory power
granted to the Jaipur Development Authority and to compel it to sanction
a particular floor area ratio, without enabling it to examine whether such
B a claim of the purchaser should be permitted or not in the light of the bye-
laws of2000 and the relevant clauses in the sale deed in favour of the writ
petitioner. (Para 16] (876-C-D]

CIVIL APPEALLA TE JURISDICTION: Civil Appeal No, 176 of2007.
c )

From the final Judgment/Order dated 2.3.2006 of the High Court of rI·

Judicature for Rajasthan at Jaipur Bench, Jaipur in D.B. Civil Special Appeal
No. I 0/2005.

Vijay Hansaria, Sr. Adv., Jatinder Kumar Bhatia and Sneha Kalita, for ""'
D the Appellants. 'I·
R.Y. Kalia, G.P. Thareja and Dr. Kailash Chand, for the Respondents.

The Judgment of the Court was delivered by
E
P.K. BALASUBRAMANY AN, J. : 1. Leave granted.
;-
2. The Government ofRajasthan issued a public notice advertising sale .....
\
by auction of a plot of land measuring I 0,490 square metres. The purchaser ~

F was to use the plot for construction of a hotel. The auction took place on
14.2.1996. The first respondent, acting through its Director, the second
Respondent, entered the highest bid. The said bid was accepted. The bid
--\
- }-

t--

amount was deposited by the respondent on 4.5.1996. The State ofRajasthan
•;>-
the appellant herein, executed a sale deed in favour of the second respondent }-

in his capacity as the Director of the first respondent on 26.3.1997. The sale
G deed stipulated that out of the total extent, an extent of 1,510 square metres
...,_
will be surrendered by the purchaser free of cost for widening of an existing
road and that the purchaser will be given the benefit of the floor area ratio '
calculated on the basis of the original plot size of 10,490 square metres. The
parameters of construction were set out and the floor area ratio was given
as 1.0. There was also a stipulation that consequent upon any change in
H
STATE v.H.V. HOTELS PVT. LTD. [BALASUBRAMANY AN, J.] 871

Building bye-laws framed by the local authorities including the Jaipur A
Development Authority, if the buyer got additional floor area ratio or any
relaxation, the State would have no objection, so long as the same are
permitted by the bye-laws prevailing from time to time.

3. Possession was delivered to the purchaser on 26.7.2000. According
to the purchaser, there was a shortage of263 square metres in the area. The B
purchaser, therefore, applied to the Government for redressal of his grievance
regarding the shortage in extent. On 22.3.2000, the Government agreed to
adjust the said extent of 263 square metres as against 1,510 square metres
the purchaser had to surrender free of charge for the widening of the road.
On 17.8.2001, the purchaser sought permission to change the user of the C
land and for permission to construct a multi purpose commercial complex
and multi complex instead of a hotel. On 27.11.2001, permission for such
changed user was given by the State.

4. Meanwhile on 1.2.200 I, new Building bye-laws were promulgated by
the Jaipur Development Authority. The bye-laws of2000 thus promulgated
D
permitted a larger floor area ratio than the one prevalent at the time of
auction in which the respondent bid. The purchaser applied on 27.4.2004
for increasing the floor area ratio so as to enable him to have the floor area
ratio of 1.75 instead of 1.0. The purchaser relied upon the clause in the sale
deed that the seller would have no objection if the buyer gets additional E
floor area ratio or any relaxation if so permitted by bye-laws as prevailing
from time to time and the fact that as per the bye-laws of2000 the permissible
floor area ratio was 1.75. The State rejected the claim of the purchaser
relying upon by law 19.8 of the Jaipur Development Authority (Jaipur
Region) Building Bye-Laws of 2000. Feeling aggrieved, the purchaser F
approached the High Court with a writ petition, CWP No. 5617 of2004. In
that writ petition, the purchaser impleaded only the State of Rajasthan and
the Secretary (Estate), General Administration Department of the Government
of Rajasthan. The purchaser did not implead the Jaipur Development
Authority which was the sanctioning authority, concerned with the
sanctioning of the floor area ratio.
G

5. The State of Rajasthan and the Secretary (Estate), opposed the writ
petition. It was pointed out that the relief prayed for in the writ petition
could not be granted without the Jaipur Development Authority being
on the party array and that even otherwise, the claim of the purchaser H
872 SUPREME COURT REPORTS (2007] I S.C.R.

A was unsustainable for the reason that in the building bye-laws of 2000
there was a specific provision confining all the parameters of construction
including the floor area ratio, to the one as specified at the time of
auction and the floor area ratio specified in the case of the writ petitioner-
purchaser, was only 1.0 and the same could not be altered as claimed by the
purchaser.
B
6. The learned Single Judge brushed aside the objection that in the
absence of the Jaipur Development Authority from the party array, the relief
sought for could not be granted, by stating that the Jaipur Development
Authority was not a necessary party because the order impugned in the writ
c petition was one passed by the State and not by the Jaipur Development
Authority and since no relief was being claimed against the Jaipur :r
Development Authority. The learned judge further held that the relevant
date, in the light of the decisions of the Supreme Court, for considering the
parameters was the date on which the construction plan was being sanctioned
by the sanctioning authority and consequently, the Building bye-laws as on
D the date of the sanction, would prevail and the purchaser was entitled to the
floor area ratio as per the bye-laws operative at that time. The learned Judge
ended up by directing the State and the Secretary (Estate) to grant the
benefit of additional floor area ratio of 1.75 to the purchaser forthwith,
overlooking that sanction has to be given by the Jaipur Development
Authority and the said authority was not on the array of parties. The State
E
and the Secretary (Estate), filed an appeal before the Division Bench. It was
pointed out that the Single Judge had ignored the effect of bye-law 19.8 of
the bye-laws and had mis-directed himself in allowing the writ petition and
in issuing a writ of mandamus even without the Jaipur Development
Authority being on the array of parties. The Division Bench, though it
F noticed bye-law 19.8 of the bye-laws, proceeded to hold that the State could
not rely on the same for rejecting the claim of the purchaser based on the.
new bye-laws. It proceeded to say that the Jaipur Development Authority
was at best a proper party and could not be held to be a necessary party.
Thus, the Division Bench affirmed the decision of the learned Single Judge
and the dismissed the appeal. The decision, thus, rendered is challenged
G
by the State of Rajasthan and the Secretary (Estate) in this appeal.

7. Learned senior counsel for the appellants contended that the learned
Single Judge and the Division Bench have completely misled themselves
into an erroneous line of reasoning and conclusion. He submitted that
H assuming that bye-laws of 2000 has to be applied, the court could not ignore
STATE v.H.V. HOTELS PVT.LTD. [BALASUBRAMANY AN, J.] 873

- bye-law 19.8 of the bye-laws, pinning down the parameters of construction
in cases of auction held, to the respective dates of auction and issue a
direction for permitting floor area ratio as per the amended bye-laws.
A

Counsel also pointed out that bye-law 19.5 relied on by the Division Bench
was only a provision permitting relaxation and the same could not have been
used to nullify the effect of bye-law 19.8. He also submitted that the
reasoning of the High Court was totally untenable. He further submitted B
that the mandamus issued had the effect of preventing the Jaipur Development
Authority from exercising its power of sanctioning the plan adhering to the
requisite parameters and such a direction without the Jaipur Development
Authority on the array of parties, was clearly unsustainable since it would
amount to fettering the powers of the authority to pass appropriate orders c
under the Building bye-laws. He further urged that the judgment of the High
Court calls for interference by this Court. The writ petition filed by the
respondent was liable to be dismissed.

8. Learned> counsel for the respondents, on the other hand, contended
that on the terms of the relevant clause in the sale deed and the law laid D
; down by this Court that the relevant date is the date of sanctioning the
building plan, the High Court was justified in issuing a direction as prayed
for by the respondents. He further submitted that the order now passed was
an equitable one and there was no reason for this Court to interfere with the
same. He emphasized that under bye-law 19.5 read with the relevant clause E
in the sale deed, the State could not take any objection to the fixation of
the floor area ratio as 1.75.

9. It is clear that the auction took place on 14.2.1996. The bye-laws
of2000 came into force only on 1.2.2001. There is no case that the said bye-
laws had retrospective operation. The sale deed stipulated the floor area F
ratio as 1.0. This was in terms of the bye-laws then existing. However, the
sale deed further stated that if consequent upon any changes in Building
bye-laws framed by local authorities including the Jaipur Development
Authority, if the buyer gets additional floor area ratio or any relaxation, the
State shall not have the objection whatsoever so long as they are permitted
by the bye-laws as prevailing from time to time. This, at best, would mean
G
that the bye-laws of 2000 which were in operation when the purchaser
applied for an approval of the plan or fixation of parameters, might be
) applicable notwithstanding the parameters specifically stipulated in the sale
deed executed in favour of the purchaser. But then, the court has necessarily
to consider the effect of all the relevant clauses in the new bye-laws. It H
874 SUPREME COURT REPORTS (2007) 1 S.C.R.

A is not open to it to ignore one clause and place undue reliance on another
clause. It may be true that the Building Bye-Laws of2000 fixed a floor area
ratio as 1.75 in general, but the question is whether the same could be
applied in the case of the present purchaser ignoring bye-law 19.8 of the
bye-laws. Bye-law 19.8 reads:

B " .... for the plots sold in the auction, parameters will remain the
same as specified at the time of auction."

10. Here, obviously, the parameters at the time of the auction, fixed the
floor area ratio as 1.0. This is also emphasized by the sale deed in favour
of the purchaser. The effect of bye-law 19.8 is clearly that the relevant date
c for fixing the parameters will be the date of auction, notwithstanding that the
new bye-laws might have provided for a higher floor area ratio. The effect
of bye-l~w 19.8 cannot get obliterated by the principle recognized by this
Court that normally the relevant date is the date of sanctioning of the plan.
Of course, going by that ratio, the bye-laws applicable may qe the bye-laws
D of2000. The floor area ratio may be 1.75 but for the specific provision in
the very bye-laws relied on by the purchaser, that in cases of plots sold by
auction, the parameters will remain the same as specified at the time of
auction. The decisions of this Court have not laid down that such a clause
cannot have operation or that such a clause cannot prevail against a general
principle that the relevant date is the date of grant of sanction. Therefore,
E nothing turns on the decisions of this Court relied on by the High Court..
The decisions do not enable the purchaser or the court to ignore a relevant
and vital clause of the bye-laws. All that the decisions indicate is that the
bye-laws on the date of sanction would apply. If the bye-laws are so applied,
bye-law 19.8 will have equal operation and on a plain understanding ofbye-
F law 19.8, it would have to be held that the purchaser is entitled to the floor
area ratio prevalent only as at the time of the auction. This is also the effect
of bye-law 19.5. In fact, the Division Bench itself has noticed that on a plain
reading of the bye-laws this was the position, but has proceeded to overrule
the contention of the State on the basis that the State cannot rely on a part
of the parameters and reject the other part. It is not very clear, what exactly
G is meant by the High Court by this observation.

11. Bye-law 19.5 re-emphasizes that the permission for construction of
the plots sold in auction before the application of the rules, will be under
the conditions specified at the time of the auction. It further provides that
H if necessary, the conditions will be relaxed in the building to be constructed.
STATE v. H.V HOTELS PVT.LTD. [BALASUBRAMANY AN, J.] 875

The sale deed recites that if parameters are relaxed as per the then existing A
bye-laws, the State will have no objection. This does not enable the High
Court to ignore the effect of bye-law 19 .8 or to nullify the effect of the earlier
part of bye-law 19 .5 itself and to say that since there is a power to relax, and
the State cannot have objection, the whole parameters could be changed
notwithstanding the relevant provisions in that behalf. The reasoning
adopted by the High Court is, therefore, found to be unsustainable. B

12. The High Court could have interfered with the order of the
Government refusing the request of the purchaser, only if that order was
vitiated by an error of law apparent on the face of the record. As we see
it, there is no error in the impugned order of the Government. Even going
by the reasoning adopted by the Division Bench, it could not be said that
c
the Division Bench was able to find a ground for the issue of a writ of
certiorari to demo!ish the order of the Government.

13. The purchaser bid the property in auction knowing fully well, the
conditions of the auction with a view to commercially exploit the site. He was D
aware of the parameters. He was a businessman, an adept in his field. It
is not open to the purchaser to get out of the obligations incurred by him
by relying on a vague plea of estoppel. The recital in the sale deed does
not estop the State from pointing to bye-law 19.8 and taking up the position
that going thereby, the purchaser has to fulfil the parameters available at the
time of the auction. No principle of estoppel can prevent the State from
E
adopting that stand. We find no merit in the plea of estoppel sought to be
raised. There is also no representation in the sale deed acted upon to his
detriment by the purchaser on which a plea of estoppel can be founded.

14. The High Court has failed to remember that the power of exemption F
is not to be exercised freely. The power to relax a Building Rule, Regulation
or requirement is an exception to the rule and it is to be used with caution
and to justify or condone minimum bona fide violations or deviations. The
purchaser bid at the auction with eyes open and with the knowledge that
the floor area ratio, as one of the parameters applicable, was 1.0 at the
relevant time. The purchaser in fact was able to get the land user changed, G
notwithstanding the original stipulation. It is not necessary now to consider
whether it was proper to permit such change of user. But, merely because
subsequently the bye-laws have been amended, it does not mean that the
parameters should be relaxed in favour of the purchaser. That would be
clearly an erroneous approach to the question of relaxation and assumption H
~
876 SUPREME COURT REPORTS [2007] I S.C.R

A of such a power would mean the nullification of Building rules themselves ,,_.;.._
and the object sought to be achieved by the Building rules and the need '
to have planned development of cities and towns in the interests of
posterity. Therefore, in our view, there is no merit in the plea based on the
power to relax contained in the amended bye-laws.

B 15. We do not see anything inequitable in the purchaser being pinned
down to his obligation under the sale by auction. Building Regulations are
in public interest. Courts have a duty to protect public interest particularly
when they do not interfere with any of the fundamental rights of the
purchaser. The plea based on alleged equity cannot be accepted.
" -
c 16. The High Court was in error in holding that in the nature of the
reliefs claimed by the writ petitioner, the Jaipur Development Authority was
not a necessary party but was only a proper party. It failed to notice that
the effect of the direction issued by it, is to fetter the statutory power
granted to the Jaipur Development Authority and to compel it to sanction
D a particular floor area ratio, without enabling it to examine whether such a
claim of the purchaser should be permitted or not in the light of the bye-
\
laws of 2000 and the relevant clauses in the sale deed in favour of the writ
petitioner. But, in the view we have taken on the merits of the claim of the
respondents, it is not necessary to further pursue this aspect of non-joinder. .,
E 17. After we have reserved judgment, the learned counsel for the
respondents submitted, what he called, sh~rt submissions in writing in
which an attempt is seen to be made to raise contentions based on Section
54 of the Jaipur Development Authority Act and Section I 02A of the
Rajasthan Land Revenue Act. We must say that these were contentions
F that were never put forward either in the Writ Petition or before us at the
time of arguments. Moreover, the respondents, who are the Writ Petitioners,
have not produced the materials with the Writ Petition or here, to establish
that the provisions relied on by them in the short submissions are really
attracted to the case. What is the nature of the land and what are the terms
of the auction have not been disclosed by the respondents either in the Writ
G Petition or before us. The recital in the sale deed relied on, does not enable
us to uphold this plea or to find any substance in it. The new plea sought
to be put forward in the written submissions is a plea which has to be
established on the facts to be proved and in the absence of relevant
pleadings cannot be upheld. This question cannot also be decided in the
H absence of the Jaipur Development Authority. We therefore do not find any
STATE v.H.V HOTELS PVT. LTD. [BALASUBRAMANYAN, J.] 877

merit in the new contention sought to be put forward after the hearing was A
concluded. We overrule the said contention.

18. For the reasons stated above, we allow this appeal and setting
aside the decisions of the Division Bench and that of the Single Judge,
dismiss the writ petition filed by the respondents. However, in the
circumstances, we direct the parties to suffer their respective costs through B
out.

K.K.T. Appeal allowed.

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)