M/s Imperial Private Industrial Training Institute's appeal dismissed; forfeiture of deposited amount deemed justified
In a significant decision, the Patna High Court has dismissed the appeal filed by M/s Imperial Private Industrial Training Institute, which sought to overturn the cancellation of its industrial plot allotment by the Bihar Industrial Area Development Authority (BIADA). The Division Bench, comprising Chief Justice Sangam Kumar Sahoo and Justice Harish Kumar, upheld the forfeiture of the deposited amount, affirming the actions taken by BIADA as per statutory provisions and contractual terms.
The case revolved around the allotment of a 10,000 sq ft plot in Jehanabad, initially intended for the establishment of an Industrial Training Institute (ITI). Despite being informed that approval of the building plan was unnecessary, the petitioner failed to commence construction within the stipulated timeframe. Subsequently, the Bihar Industrial Investment Promotion Policy, 2016, restricted the usage of vacant industrial lands exclusively to manufacturing units, leading to the cancellation of the allotment.
The petitioner argued that the policy should not have retrospective effect and requested additional land following revised affiliation norms by the Directorate General of Employment and Training. However, BIADA denied this request, citing policy restrictions and lack of available land. The allotment was eventually canceled, and the deposited amount forfeited, due to non-compliance with terms and delayed construction.
The High Court, referencing Section 6(2)(a) of the Bihar Industrial Area Development Authority Act, 1974, emphasized that mandatory requirements for show-cause notice and opportunity for hearing were duly complied with by BIADA. The principles of natural justice were upheld, as the petitioner failed to respond to the issued notices.
The judgment also reiterated the enforceability of forfeiture clauses in contracts, supported by Supreme Court precedents. The court found no perversity or infirmity in the learned Single Judge's order dismissing the writ petition, noting the limited scope of appellate jurisdiction in intra-court appeals.
Ultimately, the Patna High Court affirmed the lawful actions of BIADA, concluding that the petitioner's failure to adhere to the terms of allotment precluded any relief, thereby dismissing the Letters Patent Appeal as devoid of merit.
Bottom line:-
Cancellation of allotment of industrial plot and forfeiture of deposited amount upheld - Failure of the allottee to commence construction within stipulated time and non-compliance with terms of allotment justified the actions of Bihar Industrial Area Development Authority (BIADA).
Statutory provision(s): Bihar Industrial Area Development Authority Act, 1974, Section 6(2)(a), Bihar Industrial Investment Promotion Policy, 2016
