Observing that the builder and authorities had acted in collusion, the Punjab and Haryana High Court Friday directed the CBI to probe the matter of construction of Ambience Mall on the land meant for a housing project in Gurgaon and asked the agency to complete the investigation within six months.
While the CBI director has been asked to choose a team of officers for the purpose, a status report has been ordered to be submitted by the court within three months in a sealed cover. The court has also quashed the permissions, including licence granted for construction of the commercial complex, and directed the state to take necessary consequential steps forthwith.
A petition was filed before the High Court in 2015 alleging that the commercial complex has been raised in a blatant violation of the statutory provisions and rules. The entire complex could not have come up without the collusion of government authorities, it was alleged. The issue pertains to the construction raised in approximately 18.98 acres of land right adjacent to Delhi-Jaipur National Highway in Gurgaon’s Nathupur village. The land comprises a residential complex, commercial buildings and the mall.
The main grouse of the petitioners was that the Ambience Lagoon Island Residential Complex was originally conceived on an area of 18.98 acres but the residential area was later reduced to 7.9 acres, thus violating the builder-buyer agreement and provisions of Haryana Development and Regulation of Urban Area Act, 1975.
“The probability of connivance between the builder and the Department cannot be ruled out in view of delicencing of area meant for residential purposes and allocating the same to commercial projects. Entire sequence of events points to a prior meeting of minds between the builder and the officials who dealt with the matter. Apart from above, the fact that there has been undue enrichment of the builder perhaps with the active involvement of the State officials, cannot be ignored by this Court. Such enrichment is not just in violation of various enactments but also a loss to public exchequer at the cost of the general public, the apartment buyers in particular,” the division of Justices Rajan Gupta and Karamjit Singh said in the verdict.
The Court in the order said the builder — HLF Enterprises — in the application for establishing the group housing project in February 1992 made changes as per will and the application submitted was not in a prescribed format.
“In a clever move he projected as if the application contained all (xii) clauses envisaged by rule 3(1). A careful perusal, however, shows that one para i.e. para 2(v) with regard to lay out plan is missing which was mandatory. Strangely, this application was accepted by the authorities as such and licence was granted. It is inconceivable that concerned authorities failed to notice the stark omissions, interpolations and tampering with the basic document required for the purpose of initiation of a project,” it said in the order.
During the hearing, as per the order, the government admitted that there was no lay-out plan available on record either with the licence or with the application submitted by the builder.
Observing that it was not a matter of chance that the builder in the application omitted the para, the Court said, “It appears, the builder never intended to submit the lay out plan as his intention from the very beginning was just not to establish a housing project but other commercial buildings within the area sanctioned for group housing. We find it difficult to accept that all these clever tactics went unnoticed by the department. On the other hand, it points to their active connivance from the very initiation of the project.”
The Court said the “fraudulent exercise” had a cascading effect on the project resulting in non-adherence to FAR, lack of open spaces, reduced width of streets and absence of community buildings and schools.
“We are constrained to draw a conclusion that the possibility of builder acting in collusion with the authorities and duping innocent buyers of apartments cannot be ruled out. It appears they were made to sign on the dotted line in the Builder-Buyer Agreement, oblivious of the probable mischief by the builder in connivance with State officials,” the order reads.
Questioning the role of the director (town and country planning) in the matter, the court said it is inexplicable how the director conducted the mandatory enquiry in absence of the layout plan. Under the Haryana Development and Regulation of Urban Areas Act, the director has to enquire into the title of the land, extent and situation of the land, capacity to develop a colony and layout of the colony, plans of the works to be executed in the colony and conformity of the development scheme of the colony land to those of neighbouring areas.
While noting that the initial approval was for 18.98 acres for the group housing scheme and the prominent promise made to the buyers was that 80 per cent of the area will remain reserved for open and community areas, the court said the authorities ignored all the statutory provisions while granting permission and delicensing eight acres to establish a commercial complex in 2001. The order to delincese the area for it was passed two days after the approval was granted for construction of the commercial complex.
“Ignoring all statutory provisions and throwing caution to winds, the authorities acted more promptly than expected,” the order reads.
The court also rejected the explanation given by the state under RTI Act that since the director is empowered to grant a licence and undertake regulatory functions for development of a colony, it is an implied function of the director to allow an exit route to a developer who is not interested to pursue the development of a project and wishes to withdraw from its obligations.
“Such a plea is preposterous in view of provisions of Section 8 which confer enough power on the State to deal with a situation in which a builder is unwilling to complete the project as sanctioned,” the order reads, adding that the state in its reply has clearly admitted that there is no such thing like ‘delincecing’ under the law. The court has held the order to be without authority of law.
The court also took note of the fact that the deed of declaration was submitted by the builder in 2009 and the completion certification was granted to it in 2002. The deed of the declaration was required to be submitted within 90 days of grant of completion certification and in case of failure, the penalties, including imprisonment and fine, are attracted. The court said it is inexplicable why the authorities did not resort to the provisions under law.
“The conclusion is inescapable that the submission of Deed of Declaration was intentionally delayed for so many years as there appears to be dishonest intention of the builder from the very inception of project to dupe the buyers by raising a commercial complex within the space sanctioned for group housing project. The design to develop a commercial complex was never divulged either by the builder or State authorities to the innocent buyers at any stage. An ambiguous term was used in the Builder-Buyer agreement that 8.0 acre was reserved for ‘future development’,” the order reads.
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