DELHI DEVELOPMENT AUTHORITY versus SKIPPER CONSTRUCTION AND ANR.

Citation: [1995] 1 S.C.R. 555 · Decided: 25-01-1995 · Supreme Court of India · Bench: P.B. SAWANT, S. MOHAN, B.P. JEEVAN REDDY · Disposal: Disposed off
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Judgment (excerpt)

DELHI DEVELOPMENT AUTHORITY 
v. 
SKIPPER CONSTRUCTION AND ANR. 
JANUARY 25, 1995 
[P.B. SAWANT, S. MOHAN AND B.P. JEEVAN REDDY, JJ.) 
Judicial Process-Abuse of process of Court-Auction of Commercial 
Tower Plot-Highest bidder Skipper Construction Ltd. deposited 25% of bid 
amount-Defaults in making balance of payment-Calculated attempts made 
A 
B 
to circumvent orders of Court-Advertisement issued for conftnned booking C 
of commercial flatS-Creation of rights in favour of third parties during pen-
dency of court proceedings-DDA adopted a passive attitude-Bank's 
liberality in advancement of loans and bank guarantees to Skipper Construc-
tion-case of abuse of process of court. 
Delhi Development Authority Act-S.41-Exercise of powers unde,._ D 
Conduct of D.DA. officials in respect of Skipper Constructions-Ques-
tionable-Probe suggested. 
~n an auction held by the Delhi Development Authority of a Commer-
cial Tower Plot, the first respondent was the highest bidder. As per the E 
condition of the auction, the respondent deposited 25% of the bid amount. 
'lbe bid was confirmed by DDA and Skipper was called upon to make the 
balance payment of 75% of the bid amount within 90 days as per the 
conditions of the auction. The Government of India issued directions to 
DDA to reschedule the recovery of 75% of the bid amount with interest 
from Skipper. Skipper entered into fresh licence agreement, paid 50% of F 
the original bid and secure payment of the balanre 50% of the bid of 
submitting bank guarantees. Thereafter, the first respondent did not pay 
in terms of the agreement. Subsequently, the Lt. Governor issued a direc-
tion at the request of Skipper, deferring recovery of 2nd instalment till one 
month after the sanctioning of the building plans. Then the respondent 
filed writ petition seeking reliefrelating to sanctioning of building plans G 
and permission for coµstruction. The DDA granted conditional and 
provisional sanction to plans of the building subject to the payment of. 
monies due to the DDA. An interim order was passed by the High Court 
permitting Skipper to commence construction without first depositing the 
dues of the DDA. 
H 
555 
_j 
556 
SUPREME COURT REPORTS 
[1995] 1 S.C:R. 
A 
On appeal, the Division Bench directed the payinent ofa token sum. 
This. order was not complie4 with. Sldpper\approached the court for 
..._,,._ 
extension of time to make payment. The Court extended the time affording 
liberty to the DDA to encash the bank guarantees. However~ ,the bank 
' 
guarantee could not be encashed because it was conditional. The DDA filed 
B appeals against the interim orders passed by the High Court. The Supreme 
Court stayed further construction and made it conditional upon payment 
of a specified amount. 
A 
Skipper filed a Civil suit for a direction that the DDA ought not to 
insist upon payment by cash or draft and ought to be directed to encash 
c bank guarantee. Orders were issued directing the DDA to invoke the bank 
guarantee. However, the suit was ultimately dismissed. The writ petition 
filed by Skipper was also dismissed with direction to Skipper pay to DDA 
by cash or demand draft a sum and to stop construction till payment was 
made. In the event of non payment, DDA was made entitled to enter upon 
D the property and forfeit the monies ·already received. Skipper filed SLP 
,. 
against the dismissal of the writ petition. The Supreme Co~rt passed an 
interim order directing Skipper to deposit money. Skipper was permitted 
·to resume the construction only after making the first deposit. 
In violation of the interim order of the Supreme Court, Skipper 
E issued advertisement seeking to create third party rights. The SLP was 
dismissed and DDA re-entered and took physical possession of the proper-
ty. Skipper filed another suit in the High Court. DDA issued notices for 
auction of the property. The Allahabad High Court in a writ petition stayed 
the notice of auction. DDA published notice inviting tenders. Application 
'!"" -
F was filed to accord permission to confirm the bid for the grant of lease 
hold rights •n favour of the highest acceptable tender. 
-~ 
-' 
The petitioner argued that Skipper indulged in abuse of process of 
t--
law more than1 once. The sale of space to various flat owners 'Yas in 
G 
".iolation of law and judicial directions in view of the categorical direction 
of the Delhi High Court that the flat shall vest in DDA free from all 
't .. 
encumbrances. The ·alleged
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