M.M. Kumar, J. - (1.) THE Petitioner was the highest bidder in respect of Plot No. 1199, Sector 19 B, Chandigarh in the open auction held on 10th December, 2004. He deposited 25 per cent of the price of the site amounting to Rs. 20 lacs and the remaining 75 per cent was to be paid within a period of 90 days from the date of auction. On 3rd January, 2005, allotment letter was issued, to him which stipulated that the Petitioner was bound by the Chandigarh (Sale of Sites and Building) Rules, 1960 (for brevity 'the Rules'). The Petitioner was not able to retain the site as they could not deposit 75 per cent of the amount within 90 days. They surrendered the site on 3rd March, 2005 with a written request. The Assistant Estate Officer, - -vide notice dated 24th March, 2005 (Annexure P. 2) called upon the Petitioners to show cause why penalty @ 2.5 per cent of the premium alongwith interest be not imposed and recovered in respect of surrendered site under Rule 7A of the Rules. It is also pertinent to mention that the Petitioner was offered possession on 3rd January, - 2005 (Annexure R. 1) and they actually took physical possession on 25th January, 2005 (Annexure R. 2). Accordingly a sum of Rs. 2 lacs was deducted from the earnest money of Rs. 20 lacs deposited by the Petitioner and Rs. 18 lacs was refunded to them. Thereafter Respondents discovered a mistake and vide letter dated 5th November, 2007 issued a show cause notice to the Petitioners requiring them to explain as to why penalty by not charged @ 5 per cent as envisaged under Rule 7A(2) of the Rules. The Respondents claimed the difference of Rs. 3,38,082. On the amount of Rs. 2 lacs, interest has also been added amounting to Rs. 1,38,082 as provided by the Rule 7A of the Rules. The Petitioner contested the claim made by the Respondents and also requested for re -allotment of the plot in case they are to charge 5%.
(2.) THE basic issue which requires determination in the present case is whether Respondents were entitled to charge penalty @ 5 per cent on the surrender of the site or penalty @ 2.5 per cent was rightly charged. In that regard it would be necessary to read Rule 7(A) of the rules which read as under: 7 -A Surrender of site -(l) A transferee who has already paid at least 25% premium of the site, may, before he is offered possession of the site by the Estate Officer, and within 180 days of the allotment of the site, whichever is earlier, surrender the site on payment of 2.5% of the premium as penalty. In this event, interest at the rate prescribed in Rule 10(1) shall be chargeable on the balance premium due from the transferee for the period from the date of allotment up to the date of surrender. The date of surrender under these rules shall be the date when intimation by the transferee to this effect reaches the Estate Officer. (2) A transferee as mentioned in Sub -rule (1) above, may surrender the site within two years of the date of the allotment on payment of 5% of the premium as penalty. Interest shall be chargeable from the transferee as provided in Sub -rule (1) above. The Estate Officer shall be competent to decide such cases, as also cases under Sub -rule (1). A perusal of Sub -rule 1 of Rule 7A of the rules show that if the site is surrendered before the offer of possession and within a period of 180 days of the allotment whichever is earlier then penalty @ 2.5% of the premium is charged. It is thus evident that two conditions are required to be satisfied for application of Sub -rule (1). Firstly the surrender by the allottee has to be before the offer of possession of site by the Estate Officer. Secondly, the surrender has to be made within 180 days of the allotment of the site. Sub -rule (1) would not be attracted to the facts of the present case because possession to the Petitioner was delivered on 22nd February, 2005 (Annexure R/2) and offer of possession was made on 3rd January, 2005.
(3.) ACCORDING to Sub -rule (2) of Rule 7(A) of the Rules if a transferee surrender the site within two years of the date of allotment then penalty @ 5% of the premium is charged and interest would also be chargeable from him. In the present case, site has been surrendered by submitting an application on 3rd March, 2005 which is within 180 days from the date of allotment of letter which was issued on 3rd January, 2005 (Annexure P.l) and thereafter the process of issuance of notice and personal hearing was initiated by letter dated 24th March, 2005 (Annexure R2). The case of the Petitioner would be covered by Sub -rule (2) for the simple reason that he has surrendered the site within a period of two years after taking possession and therefore no legal infirmity is discernible in the initiation of proceedings for charging penalty @ 5 per cent vide order dated 5th November, 2007 (Annexure R4). Therefore, we find that the writ petition does not merit acceptance and is liable to be dismissed.;