RAFIQ, J. - (1.) THIS special appeal is directed against the order date 14. 7. 1992 whereby the learned Single while allowing the writ petition of the respondent herein quashed and set aside the order Annex. 9 dated 15th Sept. , 1973 and also the consequential notice Annex. 16 dated 22. 1. 1980. By the impugned order Annex. 9 dated 15th Sept. , 1973, the RIICO, namely, the appellant herein cancelled part of the land allotted to the respondents for setting up of Vegetable Oil Manufacturing Industry (in short Industry ). The State Government through Collector, Sri Ganganagar executed a lease deed jointly in favour of the respondents Vijay Kumar Jain S/o Shri Rishab Dasji and Ganpat Rai S/o Late Shri Kaluramji on 5. 2. 1970 thereby leasing out a plot of land measuring 450' x 210' situated in their industrial estate, Sri Ganganagar for the purpose of setting up Industry. Apart from various other conditions, condition No. 4 (iv) of the lease deed stipulated that the lessee shall set up in the said plot of land an Industry for which land has been leased out to them by the lessor within a period of one year from the date of delivery of its possession subject to the condition that construction shall be started on the plot within a period of three months from the date of delivery of possession and further the same would be completed within next six months' or such period as may be extended by the Director of Industries and further that machinery shall be installed and production shall be started within next three months. THIS condition further provided that in case of failure of the leassee to do so, the said plot shall revert to the lessor unless the period of one year is further extended by the lessor on valid ground. When the respondents failed to fully utilize the land allotted to them, by setting up Industry and rather intended to use it for a different purpose, the Dy. Director, Industries served upon them a show cause notice on 7. 06. 1973 (Annex. 6) stating therein that since the respondents have set up a Dal Mill in the subject plot in contravention of the Rajasthan Industrial Area Allotment Rules, 1959 (in short the Rules of 1959) and further that they have started construction towards the northern strip of plot for a Cotton Ginning Factory for which also no permission was granted to them. By this notice, the respondents were required to show cause as to why the allotment of land excluding 25' to the north of the wall of the Oil Mill be not cancelled.
(2.) THE respondents replied to the aforesaid show cause notice on 18. 6. 1973 (Annex. 7 ). In the reply, which was addressed to the Director of Industries it was stated that when the Director visited the Industrial Estate, Sri Ganganagar, the respondents had explained to him all the unavoidable circumstances owing to which Vanspati Mill could not be established and, thereupon, the Director gave them verbal permission to set up Ginning & Pressing Plant and accordingly instructed the District Industries Inspector to make available cement bags also for construction thereof. A separate representation was submitted by the respondents to the Secretary to the Government, Industries Department, Rajasthan Jaipur requesting him to instruct the Director of Industries not to cancel allotment of disputed plot. THE Director Industries however by his order dated 15th Sept. , 1973 cancelled allotment of land excluding the land on which the respondents had set up an Oil Mill upto 25' to the north of the wall of the said oil mil on the premise that the respondents failed to utilize the allotted land for the purpose for which it was alloted to them and violated other conditions of allotment. Total land area of the industrial plot allotted to the respondents was in the size of 450' x 210' ad measuring 94500 sq. feet, out of which, size of plot which the respondents were allowed to retain was 124' x 210' measuring 26040 sq. feet. Size of the remaining area of the plot allotment of which was cancelled was therefore 326' x 210' measuring 68460 sq. feet. Aggrieved by cancellation of the allotment, the respondents field writ petition before this Court being S. B. Civil Writ Petition No. 1432/1973, which they later withdrew on 5. 05. 1982 with liberty to institute fresh one if necessary. According to the respondents, they were prompted to withdraw the said writ petition because of an assurance held out to them by the District Industries Officer, Sri Ganganagar that they would regularize the matter provided the writ petition was withdrawn. Subsequent thereof, the District Industries Officer by his communication dated 2. 6. 1982 inquired from the respondents as to in what time, they would set up the industry and pay outstanding dues and further whether they would withdraw the writ petition pending before this Court. It is interesting to note that even though the respondents replied to the said communication on 6. 06. 1982, they still maintained that in view of the spirit of compromise and assurance given by the authorities, they were prepared to withdraw the writ petition and had in fact instructed their counsel to withdraw the same whereas in fact, the writ petition already stood withdrawn on 5. 05. 1982. In the meantime, the Director of Industries vide his communication dated 27. 2. 1986 required Dy. Director District Industries Center, Sri Ganganagar to scrutinize the proposal of the respondents in the light of the existing guidelines and instructions and discuss the same with Regional Engineer, RIICO and thereafter, forward his proposals to the Directorate. The District Manager, District Industries Center, Sri Ganganagar forwarded his proposal to the Director, Industries vide his letter dated 22. 3. 1986. The Directorate however, by their letter dated 19. 05. 1986 returned the papers back to the District Industries Center, Sri Ganganagar with the note that as per the Rules of 1959, the RIICO has since been authorized to deal with all the incidental and residual matters and, therefore, the District Industries Center should make scrutiny of the whole case at their own level. Finally, the RIICO by its notice dated 22. 1. 1990 required both the respondents to show cause within a period seven days as to why the land in question may not be allotted to other enterpreneours. The respondents at that stage filed writ petition which has given rise to present special appeal. The writ petitioner was filed on the premise that the cancellation of allotment by the State Government was ultra vires of the Rules of 1959. It being lessor could cancel the allotment only if lessee (respondents) failed to set up industry within two years according to Rule 7 of the said Rules. Since the allotment of the land in question was made for the purpose of setting up an industry, which has been duly set up and started within three or four months from the date of allotment, the cancellation could not be made. Lease deed in favour of the respondents was executed for a period of 99 years and the lessor could not dispossess the lessee before the expiry of such period. When the then Director of Industries Shri Anil Boradiya visited Sri Ganganagar in a function, he had permitted the respondents to set up Oil Mill and Ginning Factory on the disputed land and the said assurance was substantiated from the affidavits of three reputed businessmen, who attended the said function. The State Government could not now cancel allotment and also could not refuse permission to set up other kind of industry on land in question. Cancellation of allotment has been made without application of mind. When the respondents had favourably responded to the proposal submitted by the District Industries Officer in their letter dated 2. 06. 1982, allotment of the land could not be cancelled. It was therefore prayed that the cancellation order dated 15th Sept. , 1973 and the subsequent communication of RIICO to the respondents dated 22. 1. 1980 be quashed and set aside. While the State Government, Director, Industries and District Industries Officer, Sri Ganganagar filed a common reply, RIICO filed a separate reply to the writ petition. The State Government in its reply came out with the plea that the respondents had submitted project report for setting up Vegetable Oil Industry with an investment of Rs. 35 lacs. However, when they failed to set up such Industry because of their failure to take effective steps for establishing such Industry within stipulated time, the Central Government refused to grant the licence. Cancellation of allotment in relation to part of land was rightly made and the possession of such land was also taken. Although the respondents established Oil explorer, but failed to establish Vanspati Ghee Industries. As regards their request for setting up Dal Mill, it was stated that this was a very small unit in comparison to Vanspati Ghee Industries and, therefore, needed a very small piece of land. On the proposal of the respondents to set up Cotton Ginning Factory also, the stand of the Government was that setting up such plant also needed small piece of land. Besides this, it was also stated that the respondents were frequently changing their mind and coming out with different proposals at different stages one after another with the sheer purpose of retaining the land by hook and crook because the land prices in the meantime have appreciated enormously. They therefore prayed that writ petition may be dismissed.
(3.) THE RIICO in its reply referred to rule 11-A and 12 of the Rule of 1959 and submitted that pursuant to such rules the industrial area in question has now been put in their charge. THEy placed on record copy of the order dated 15th Sept. , 1979 issued by the Government in its Department of Industries in which it has been provided that all the Industrial Estates set up and controlled by Industries Department would stand transferred to RIICO w. e. f. 1. 10. 1979. THEy placed on record copy of show cause notice dated 17th Sept. , 1973, which were served upon the respondents requiring them to send their representative at the site of the plot to hand over its vacant possession to the RIICO. THE have also placed on record copy of the possession memo prepared at site at 2. 45 PM on 17th Sept. , 1973 to the effect that they had taken possession of the disputed plot. The writ petition filed by the respondents was allowed by the learned Single Judge vide impugned order dated 14. 07. 1992 on the premise that the respondents were prevented from setting up Vegetable Oil Industry for reasons beyond their control. The respondents had already set up an Oil Mill and a Dal Mill on the disputed land and started construction of Ginning Factory when notice was issued on them. The fact that allotment of part of the plot was not cancelled shows that the lessor State of Rajasthan had no objection to the lessee making use of land for establishment of an Oil Mill. Accordingly, the condition No. 1 of the lease deed which restricted use of the land for setting up of Vegetable Oil Industry was not violated. There was no term or statutory provision for cancellation/reversion of the plot in question. The State Government had not taken a decision on the request of the respondents to either grant or refuse the permission to set up Dal Mil on the plot and therefore, the State as a lessor could not invoke condition No. 4 (iv) of the lease deed. Order of cancellation dated 15th Sept. , 1973 cannot be considered to be operative against the respondents because they withdrew the writ petition on the assurance that they would be permitted to set up another kind of factory on the disputed land. The RIICO being only an assignee of the State of Rajasthan was not lessor of the respondents and, therefore, it could not invoke clause 4 (iv) of the lease deed and issue cancellation order Annex. 9. Rule 11-A which was inserted in the Rules of 1959 w. e. f. 23rd Dec. , 1983 merely authorized the State Government to allot land to RIICO for developing and setting up industrial area and such rule can only apply prospectively after 23rd Dec. , 1983. Land in question having been allotted to the respondents in the year 1970, such rule would not apply to their case. Rule 12 of the Rules also does not apply to this kind of allotment. The learned Single Judge further held that even according to Rule12 of the Rules of 1959, the RIICO does not enjoy the same power with regard to the plot in question as it enjoys about the vacant plots and land allotted to the enterpreneours by it. It has not right to impose fresh conditions on previously allotted lands. The District Industries Officer by his letter dated 2. 6. 1982 having called upon the respondents to withdraw the writ petition and put forward proposals for establishing alternative industry, the right of the lessor under condition No. 4 (iv) of the lease deed stood waived. The writ petition was accordingly allowed, Hence, this special appeal. We have heard Shri M. R. Singhvi, learned counsel for the appellant RIICO and Shri V. K. Jain, respondent No. 2 and Shri Avinash Acharaya, learned counsel for the legal representatives of respondent No. 1 Shri Ganpat Rai. ;