P&H HC orders FIR & CBI enquiry into Builder/State connivance & declares construction of Ambience Mall, Gurgaon illegal

The Punjab & Haryana High Court in the case of Amitabha Sen v. Raj Singh Gehelot, decided recently on 10-7-2020 has not only declared that the construction of Gurgaon’s famous Ambience Mall illegal but also ordered a CBI inquiry into the prima facie connivance between the builder and the concerned state authorities.

The petitioner had  filed a civil writ petition against the illegal construction of Ambience Mall in Gurgaon on around 8 acres of land. The petitioner had alleged that the licence was originally granted only for the development of residential complex on the entire land admeasuring about 19 acres but with the connivance of the State Authorities the licence was altered for development of mall on an area of around 8 acres without following due procedure and without the authority of law.

The petitioner alleged that there was gross violation of rules and procedure. It was also alleged that the Developer & the State Authorities conspired to the prejudice of the public exchequer through an illegal, arbitrary & criminal act by tampering & interpolating the documents. Various discrepancies were revealed wherein the Developers acted in defiance of the Haryana Development and Regulation of Urban Areas Act, 1975 and the rules framed thereunder. The High Court being convinced with the averments observed thus:

“Strangely, this application was accepted by the authorities as such and license was granted. It is inconceivable that authorities concerned failed to notice the stark omissions, interpolations and tampering with the basic document required for purpose of initiation of a project.”

The High Court was critical against the  delicensing of part of the impugned land without any authority of law: The High Court ruled that there are no such provisions under which the order of delicensing 8 acres out of 18.98 acres of land originally licensed for residential complex was passed by the authorities. The High Court rejected the argument of the State counsel for taking benefit of  Section 21 of the General Clauses Act wherein it was pleaded that the power to delicence is ancillary to the power to grant license. The Court categorically held thus:

“Reference to Section 21 is only an ex post facto justification and an afterthought. Law is settled on this point that State affidavit/plea cannot augment or add to the orders passed by the authorities. The reasons, if any, have to be contained in the order itself, as same would only be subject to judicial review. No authority by adopting circuitous route can circumvent the settled legal position.”

The Court smelt a rat in the whole process of delicensing a part of the land as a premeditated & preconceived plan to raise commercial complex. The Court was irked  in the way the authorities “acted more than promptly” while permitting the erection of commercial complex after delicensing 8 acres of land and in the process “ignoring all statutory provisions and throwing caution to winds”.  The Court noted that permission to establish a mall was granted even earlier to the order delicensing the impugned land which itself speaks volumes of the collusion between the Developer & the concerned authorities.

The Court also noted that the provisions of the Haryana Apartments Ownership Act, 1983 were not only ignored but nullified as the vested rights of the apartment owners were encroached and the building  plans & land use altered phenomenally without the written consent of the apartment owners as mandated by the said Act. The Court was critical against the Developer for withholding the information about their intention for construction of Mall by using the term in the builder-buyer agreement that 8 acres was reserved for “future developments”. The Court categorically held the Builder Buyer agreement cannot override the law laid down to regulate urbanisation and to prevent ill-planned and haphazard development.

The Court had reasons to believe that there was connivance between the builder and the State authorities. The Court held that this was a predesigned conspiracy and noted that the ‘Entire sequence of events points to a prior meeting of minds between the builder and the officials who dealt with the matter.’ The Court had serious conviction that there was active involvement of the State authorities who colluded with the Developer to disrobe the state exchequer of its legitimate revenue. According to the Court such an illegal act performed for the undue enrichment of the Developer was to be deprecated.

In the aforesaid circumstances, the Court held that the entire episode needs thorough investigation by an expert agency against the blatant and colourful misuse of the power vested with the government officials in this case. Moreover, in order to preserve the rights of the  residents of the said residential complex, the Court quashed the illegal & arbitrary order delicensing 8 acres out of the original 18.98 acres of land  and  also quashed the order granting permission to raise commercial complex on the delicensed area. Thus the construction of Ambience Mall has been declared illegal by the Court and accordingly the Court directed the State to take “necessary consequential steps forthwith”. Seeing the gravity of the matter and the blatant collusion between the Developer & the State Officials to deprive the public exchequer of its lawful revenue and also with utter disregard to the established Law, the Court directed  CBI to  investigate the entire issue after registering a FIR within six weeks of the order.

The wisdom of the Court has to be appreciated but the Developer alone is not responsible for this scamous situation. This has been possible only with the able assistance and guidance of government officials under the silent orders of their political rulers. It is true that if CBI finds relevant evidence, none would be spared. But quashing both the orders of delicensing & construction of mall expressly mean the order for demolition of the collosal & iconic building which would not be fair as tons of national wealth & world class infrastructure would be reduced to a big Zero. The right course should be to impose hefty penalties on the Developer and pay a part of it to the Residents Welfare Society of the Residential complex abutting the Mall as a compensatory measure. The problems of the store owners of the Mall should also be considered  both by the Courts and the Government as they have invested heavily in running their stores and a Mediation/ Conciliation mode be applied while punishing both the Developer & the erring Government officials. The harsh pecuniary penalties and Prosecution of those involved would send a message that the Law is Supreme and the Rich & Powerful cannot circumvent the Rule of Law.


Disclaimer: The contents of this article are for information purposes only and do not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc before acting on the basis of the above write up.  The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that Author / TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

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January 2021