Anjana Saraiya vs. The State of U.P. & Ors.
Background
Anjana Saraiya, a 55-year-old woman, was allotted a residential plot under a Middle-Income Group housing scheme in Ghaziabad, Uttar Pradesh, after winning a draw of lots, for a total price of Rs. 2,70,000. She paid the upfront amount and the first three instalments on time, but defaulted on instalments 4 to 7 because her husband's continuing illness put her in financial difficulty. Before the cancellation notice (dated 14.06.2006) was even served on her, she managed to arrange funds and deposited the entire outstanding balance with interest on 16.06.2006, but the authorities cancelled her allotment anyway, and the Allahabad High Court upheld the cancellation, dismissing her writ petition.
Decision Breakdown
The Supreme Court noted that by the time of the appeal, the appellant had already deposited a total of Rs. 3,84,546, well over the plot's original price of Rs. 2,70,000, showing genuine intent to pay rather than deliberate or willful default. Given her bona fides, her readiness to pay a further Rs. 2,00,000 as compensation for the delay, and the fact that the plot remained vacant and had not been allotted to anyone else, the Court held that the equities favoured saving her allotment. It set aside the High Court's judgment and the cancellation order, conditional on the appellant depositing an additional Rs. 2,00,000 within six weeks, after which the authorities were directed to hand over vacant possession of the plot and complete the necessary documentation.
Lesson Learnt
Courts can look beyond a rigid, mechanical application of default clauses in government allotment schemes where the allottee demonstrates genuine hardship (not willful default), has already paid substantially more than the dues, and no third party's rights have intervened: equity can permit reinstatement of an allotment on payment of reasonable additional compensation.