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Bhasin Infotech and Infrastructure Private Ltd. vs. State of Uttar Pradesh & Anr.

Not available · 2023 INSC 260Decided 17 Mar 2023
Not available

Background

The petitioner-company had been allotted a commercial plot in Surajpur, Gautam Budh Nagar (UP) in 2006 by UPSIDC on a 90-year leasehold basis, on which it built a mall/multiplex. Relying on a later government policy (2013, amended 2016) meant for converting leasehold land used for tourism/theme-park projects into freehold, and on a 2016 letter from the Director General, Tourism, the company sought to convert its leasehold rights into freehold rights. The State rejected this request by an order dated 24.01.2022, and after a writ petition filed in the Allahabad High Court was transferred to the Supreme Court, the company challenged that rejection directly before the Court.

Decision Breakdown

The Supreme Court held that the freehold-conversion policy simply did not apply to this land, since the amended policy came into force only after the mall's completion certificate had already been issued and there was no provision making it retrospective in a way that could override existing lease terms. It found that the 2016 tourism department letter, despite being called an "approval" by the petitioner, was only a recommendation to treat the project as a theme-based mall and did not, and could not, amount to a binding decision granting freehold rights, especially since the committee that issued it did not include UPSIDC, the authority actually holding the lease. The Court also rejected reliance on an earlier recommendatory letter from UPSIDC's own Managing Director as legally baseless. Consequently, the impugned order refusing conversion to freehold was upheld and the writ petition was dismissed, with the Court clarifying its ruling was confined strictly to the freehold-conversion issue and had no bearing on any other pending disputes between the parties.

Lesson Learnt

A government policy benefit cannot be claimed retrospectively or extended beyond its actual terms merely because an internal committee's recommendatory letter uses favourable language like "approval", only a binding decision by the competent authority, consistent with the policy's actual scope and the existing lease terms, can confer such a right.

Official source (sci.gov.in)View Judgment (PDF)

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