The Allahabad High Court has refused to grant relief to a petitioner who sought the restoration of a cancelled lease after failing to comply with payment obligations tied to an industrial land allotment. The bench, comprising Justices Mahesh Chandra Tripathi and Vinod Diwakar, held that a writ court exercising equitable jurisdiction under Article 226 of the Constitution cannot aid a consistent defaulter. The Court observed that allowing such relief would establish a dangerous precedent and erode the seriousness of compliance expected from leaseholders in state-sanctioned allotments.
The petitioner had been allotted a plot in an industrial area, subject to payment conditions that required a substantial balance amount of nearly ₹19.8 lakh. Despite being granted multiple extensions to fulfill his financial obligations, including one granted by an earlier court order, the petitioner failed to make the necessary payments. As a result, the concerned authority cancelled the allotment. Subsequently, the petitioner approached the authority seeking restoration of the lease, which was also declined. Aggrieved by the cancellation and the refusal to restore the lease, the petitioner filed a writ petition before the High Court, seeking intervention on grounds of equity and alleged hardship.
In rejecting the plea, the High Court emphasized that equity is not meant to benefit those who consistently default on their obligations, particularly when they have been given ample opportunities to comply. The Court stated that statutory contracts, especially those involving public property and administered by development authorities, must be honored in accordance with the law and the contractual framework. Invoking equitable powers in such a scenario, the bench observed, would not only be contrary to law but also harmful to public interest, as it would encourage others to act irresponsibly with an expectation of similar leniency.
The Court referred to earlier judicial precedents, including the ruling in Skyline Contractors Pvt. Ltd. v. State of U.P., to reiterate that equitable relief cannot be granted to defaulters who have breached essential terms of a contract and then seek to challenge consequences arising from their own failure. The Court clarified that such cases do not give rise to a legal right that can be enforced through writ jurisdiction. Instead, these are matters of contractual obligations and statutory compliance, where judicial interference is unwarranted unless arbitrariness or illegality is demonstrably proven.
Addressing the broader implications of the case, the bench observed that development authorities such as the Noida or Greater Noida authorities are tasked with allocating land to industrial applicants based on merit, feasibility, and compliance. When an allottee violates key conditions repeatedly and fails to make payments within prescribed timelines, it undermines the efficiency and credibility of the entire allocation system. The Court said that recognizing the petitioner's claim under the writ jurisdiction would dilute the very objective of statutory enforcement mechanisms like cancellation and e-auction.
The judgment also acknowledged that equity must be applied judiciously and not extended to shield those who have failed in fulfilling clear and repeated legal responsibilities. Relief granted on equitable grounds must be rooted in demonstrable injustice, not in overlooking willful default. In the present case, the Court noted, the petitioner’s conduct showed a pattern of non-compliance and an absence of sincere effort to meet the financial terms of the lease agreement.
In conclusion, the High Court dismissed the writ petition, upholding both the cancellation of the lease and the rejection of the restoration application. The ruling serves as a clear signal to allottees that leniency should not be expected when legal and financial obligations are ignored. It reaffirms the principle that writ courts should not be used as a forum to bypass contractual terms, especially in dealings involving public assets and statutory frameworks. The Court's decision strengthens the legal precedent that equity cannot be invoked to legitimize chronic default and non-performance.
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