Allahabad High Court quashes the order issued by NOIDA for canceling the Lease Deed of an Allottee.

Allahabad High Court quashed an order passed by the New Okhla Industrial Development Authority, holding the same to be 'vulnerable in law', vide which the NOIDA Authority had canceled the lease deed in favour of the petitioner company/allottee, and had also forfeited the security in the most arbitrary, illegal and mechanical manner.

The petitioner company was allotted a plot by the NOIDA on 30.3.2011 for office use on a lease for 90 years as per terms and conditions in the allotment letter. Subsequently, on 21.9.2011 a registered lease deed was executed between the parties and possession handed over to the petitioner-company on 3.10.2011. The petitioner adhered to all the scheduled payments but NOIDA failed to provide any infrastructural facilities and amenities as a result of which the petitioner-company was unable to raise constructions, leading to the passing of the impugned order dated 07.01.2021.

It was argued on behalf of the petitioner company that the aforesaid impugned order has been passed in alleged compliance of the provisions of the U.P. Industrial Area Development Act, 1976 (for short "the Act"). The State Government vide U.P. Act No.25 of 2020, notified on 31.8.2020 amended the provisions of the said Act by inserting a Proviso to Section 7 of the Act, the 2nd part of which gives a valuable right to the allottees that in case the specified period as mentioned in the lease for completing the construction work had already lapsed before the commencement of this Act, the Authority shall give a notice to the allottee to use the land within one year for the purpose for which it was allotted and in the absence of any statutory notice to petitioner, the impugned order canceling the lease deed is not sustainable in law as it is passed in contravention to the amended provision introduced in Section 7 of the Act by the way of Uttar Pradesh Industrial Area Development (Amendment) Act, 2020 and has thus cause to a miscarriage of justice.

The Hon'ble Court observed that the condition precedent for applicability of the 2nd part of the proviso is that the period for utilization should have expired before the commencement of the Amending Act i.e. 28.7.2020 and the Authority before canceling the allotment/lease should have given a notice to the allottee to utilize the said land within a year. Since it was not disputed by the Authority that no notice as contemplated in the 2nd part of the proviso to Section 7 of the Act was ever issued to the petitioner, which is also authenticated in the impugned order, as the same does not refer to the issuance of any such notice, hence, the impugned order dated 7.1.2021 has become vulnerable in law.

Ultimately, the Hon'ble Court allowed the writ petition and was pleased to quash/set aside the impugned order passed by the NOIDA.

Sr. Advocate Shri Navin Sinha appeared on behalf of the petitioner company and the petition was filed by Adv. Devesh Saxena, Managing Partner, S&D Legal Associates.

Read the order:

WRIC(A)_2238_2021.pdf

Download PDF • 369KB

[Image Courtesy: newindianexpress.com]