Vision Town Planners Prevails Over Noida Authority as Court Orders Refund with Interest and Zero Period Benefit
In a significant decision, the Allahabad High Court has ruled in favor of Vision Town Planners Private Limited, directing the Noida Development Authority to grant zero period benefits and refund illegally levied Change in Constitution (CIC) charges. The judgment, delivered by Justice Prakash Padia, addresses key issues of procedural lapses and illegal financial demands by the development authority.
The court's verdict comes in response to a writ petition filed by Vision Town Planners, challenging the authority's refusal to set aside a demand for Rs. 168.37 crores towards arrears of annual lease rent and Rs. 7.38 crores towards CIC charges. The petitioner argued that these charges were unjustly imposed due to the development authority's failure to issue a separate possession certificate, as required under the subdivision permission conditions.
The court found merit in the petitioner's claim for zero period benefit, citing the authority's non-compliance with Condition No. 3 of the subdivision permission, which mandated a separate possession certificate. The court held that the petitioner should not be charged lease rent for the period during which possession was not lawfully handed over. Consequently, the court ordered the development authority to recalculate the lease rent from the date the possession certificate is issued.
On the issue of CIC charges, the court ruled the levy as illegal and unjustified, referencing previous judgments that established the illegality of such charges for mere changes in shareholding. The court ordered the refund of Rs. 7.38 crores, along with an interest rate of 9% per annum, emphasizing the authority's conduct as unfair and unreasonable.
The decision underscores the importance of administrative fairness and compliance with procedural mandates, setting a precedent for similar disputes involving development authorities and private entities.
Bottom Line:
The petitioner is entitled to zero period benefit due to the failure of the development authority to issue a separate possession certificate as mandated under Condition No. 3 of the sub-division permission. Additionally, the levy of CIC charges on the petitioner for change in constitution is illegal, and the petitioner is entitled to a refund of the amount along with interest.
Statutory provision(s): Condition No. 3 of subdivision permission, Transfer of Property Act provisions on lease, Judgments on CIC charges legality, Administrative fairness principles
Vision Town Planners Private Limited v. State of U.P., (Allahabad) : Law Finder Doc id # 2825922
