Supreme Court Resolves Okhla Enclave Land Dispute: Directions for Plot Allottees and Colonizer

The case of Okhla Enclave Plot Holders’ Welfare Association vs. Union of India and Others involves a long-standing dispute over the allocation and development of plots in Section 91 of the Faridabad-Ballabgarh Complex, Haryana. The matter concerns the claim of several allottees who were not given possession of plots they had paid for, as well as the failure of the colonizer, Durga Builders Pvt. Ltd., to meet its obligations under government regulations.

Background of the Case

In 1985, the respondent No.6-Colonizer (Durga Builders Pvt. Ltd.) acquired approximately 235 acres of land for large-scale settlement. At the time, no formal government policy regulated such settlements. However, in 1991, the State of Haryana introduced a colonization policy, requiring developers to obtain licenses for such projects. Durga Builders obtained seven such licenses.

By 1996, several plot buyers filed writ petitions under Article 32 of the Constitution of India, claiming that the colonizer had failed to adhere to the agreed terms and had not allotted the plots despite receiving payments. In response, the Supreme Court passed various orders, including one on December 2, 1999, directing all allottees to pay Rs.50 per square yard towards development charges within four weeks.

Key Developments in the Case

Supreme Court Appoints an Arbitrator

To resolve the dispute, the Supreme Court appointed Justice Vikramjit Sen, a former judge, as the sole arbitrator. The arbitrator identified three categories of allottees:

• General Category
• Economically Weaker Sections (EWS)
• No Profit No Loss (NPNL)

The Scrutiny Committee prepared a report categorizing 19,324 allottees under NPNL, 4702 under General, and 350 under EWS (of whom 106 applied for allotment).

Supreme Court’s Key Findings

Justice R. Banumathi and Justice A.S. Bopanna presided over the case and made several crucial findings:

• The colonizer had failed to adhere to licensing requirements and had not paid renewal fees, accumulating an outstanding amount of Rs.21.86 crores.
• The internal development work had deteriorated over time, requiring fresh estimates for completion.
• The State of Haryana had spent approximately Rs.1.25 crores for security measures and monitoring unauthorized constructions on the land.

Directions Issued by the Supreme Court

1. Completion of Development Work

The Supreme Court determined that Rs.128.7 crores would be required to complete the internal and external development works. The State of Haryana was directed to undertake this development upon receiving at least 90% of the total cost from the allottees.

2. Payment Responsibilities of Allottees

The Court directed eligible plot owners to proportionately contribute to development costs. Those failing to pay within the stipulated time would forfeit their right to the plot.

3. Liability of the Colonizer

Durga Builders Pvt. Ltd. was directed to pay:

• Rs.21.86 crores as outstanding renewal fees with 6% annual interest.
• Rs.1.25 crores to cover expenses incurred by the Haryana government for security and monitoring of the land.

If the colonizer failed to pay, the State of Haryana was instructed to recover the amount as land revenue.

4. Plot Reallocation

Any vacant plots left due to non-payment by allottees would be reallocated, with first preference given to eligible claimants. If surplus plots remained, the colonizer could claim them only after fulfilling its financial obligations.

5. Adjustments in Plot Size and Density

The State of Haryana was instructed to assist in adjusting plot sizes in compliance with existing regulations. Density norms for roads and public spaces could not be altered.

6. Change in Proceedings to a Special Committee

The Court clarified that the arbitration proceedings should be treated as a Special Committee, given the absence of a formal arbitration agreement between parties.

Final Observations

The Court emphasized that the case had been pending for over two decades and required a time-bound resolution. It directed that developments such as water supply, sewerage, and electricity should not be extended to those who fail to pay the required charges.

With these directives, the Supreme Court sought to ensure justice for the allottees while holding the colonizer accountable for its lapses.

Petitioner Name: Okhla Enclave Plot Holders’ Welfare Association.
Respondent Name: Union of India and Others.
Judgment By: Justice R. Banumathi, Justice A.S. Bopanna.
Place Of Incident: Faridabad, Haryana.
Judgment Date: 03-10-2019.

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