UNION TERRITORY, CHANDIGARH ADMN. AND ORS. versus MANAGING SOCIETY, GOSWAMI, GDSDC

Citation: [1996] 2 S.C.R. 620 · Decided: 14-02-1996 · Supreme Court of India · Bench: KULDIP SINGH, S. SAGHIR AHMAD · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
UNION TERRITORY, CHANDIGARH ADMN. AND ORS. 
B 
v. 
MANAGING SOCIETY, GOSWAMI, GDSDC 
FEBRUARY 14, 1996 
. [KULDIP SINGH AND S. SAGHIR AHMAD, JJ.] 
Punjab (Development and R~gulation Act), 1952/Chandigarh Lease-
hold of Sites and Building Rules, 1973 : Rule ]~Allotment of land to 
Society-Demand of difference in ground rent paid and payable under 
C statutory Rules-High Court holding that the annual rent fIXed could not have 
been revised-On appeal held, a contract in violation of mandatory provisions 
of law can only be read and enforced in tenns of the law ·and in no other 
way-Equitable estoppel cannot be raised since there can be no estopple 
ID 
E 
F 
against statute. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 10419 of 
1995. 
From the Judgment and Order dated 22.10.91 of the Punjab & 
Haryana High Court in c:w.P. No. 6149 of 1991. 
S. Ujagar, Devender Verma and Naresh Bakshi, for the Appellants. 
D.V. Seghal, AV. Palli and Ms. Rekha Palli for the Respondents. 
The following Order of the Court was delivered : 
The Chandigarh Administration allotted 10.5 . acres of land to the 
managing Society, Goswami Ganesh Dutt Sanatan Dharam College, Chan-
digarh {The Society), respondent in the appeal herein, by the letter dated 
June 21, 1975. The Estate officer, Chandigarh Administration, on March 
15, 1991, directed the Society to pay a sum of Rs. 1,74,690, the difference 
G between the ground rent already paid by the Society and the one which 
was payable under the statutory ~ules. The Society challenged the notice 
by way of a writ petition before the Punjab and Haryana High Court. Writ 
petition was allowed by tlie High Court and· the demand notice was 
quashed .. This appeal by the Chandigarh Administration is against the 
H judgment of the High Court dated October 22, 1991. 
620 
.... 
UNION TERRITORY v. MANAGING SOCY. GOSWAMI 
621 
The land was allotted to the society for a period of 99 years at the A 
rate of Rs. 10 per square yard with ground rent at the rate of Rs. 100 per 
acre per annum. The allotment to the Society was subject to the provisions 
of the capital of Punjab (Development and Regulation) Act, 1952 (the Act) 
and the rules framed thereunder. The Chandigarh Lease-hold of Sites and 
Buildings Rules, 1973 (the rules), framed under the Act were enforced with 
effect from August 20, 1973. Rule 13 of the rules is as under : 
"13. Rent and Consequences of non-payment. In addition to the 
premium, whether in respect of site or building, the lessee shall 
pay rent as under : 
(i) Annual rent shall be 2-1/2% of the premium for the first 33 
years which may be enhanced by the Chandigarh Administration 
to 3-3/4% of the premium for the next 33 years and to 5% of the 
premium for the remaining period of the lease. 
B 
c 
(ii) Rent shall be payable annually on the due date without any D 
demand from the Estate Officer. 
Provided that the Estate Officer may for good and sufficient 
reasons extend the time for payment of rent upto six months on 
the whole on further payment of 6% per annum interest from the E 
due date upto the date of actual payment. 
(iii) If rent is not paid by the due date, the lessee shall be liable 
to pay a penalty not exceeding 100% of the amount due which may 
be imposed and recovered in the manner laid down in section 8 
of the Capital of Punjab (Development and Regulation) Act, 1952, F 
as amended by Act No. 17 of 1973". 
It is obvious from Rule 13 reproduced above that in addition to the 
premium the lessee under the Act and the rules has to pay annual rent at 
the rate of 2-1/2% of the premium for the first 33 years. The fixation of 
the premium at the rate of Rs. 100 per acre, in the case of the society was G 
in patent violation of the rules. There is no discretion under the rules with 
the Chandigarh Administration to fix annual rent at a rate lower than the 
one provided under the rules. It is stated by the Chandigarh administration 
that while preparing comments to the complaint filed by one Dr. M.L. 
Saini, Chall-man of the Chandigarh Recognised Schools Management As- H 
622 
SUPREME COURT REPORTS 
[1996] 2 S.C.R. 
A 
sociation before the Rajya Sabha Committ~e, it came to the notice of the 
administration that the fixation of annual rent, in respect of the land 
allotted to the Society and some other educational institution, was in 
violation of Rule 13 of the rules. It was under these circumstances that the 
mistake which was made in the year 1975 was sought to be correc
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