Case Note & Summary
The appellants, Prasad Pandurang Tapkir and Shakuntala Pandurang Tapkir, owned agricultural land in Survey No. 103/2/2 of Alandi Taluka, Pune District. They sought to develop the land under a government scheme for homogenous development in areas adjoining municipal corporation limits, which allowed modification of the regional plan. On 25.05.2012, they applied for conversion of land use for group housing construction. Premium rates were notified on 18.06.2012, and on 30.08.2012, the appellants paid ₹30,46,290/- as premium for extra Floor Space Index (FSI). Permission was granted on 08.10.2012. However, the appellants abandoned the group housing plan and instead applied for plotting on 16.12.2013, which was permitted on 19.04.2014, with the terms of the earlier order remaining in force. On 13.08.2015, the appellants applied for refund of the premium, claiming they had not utilized the extra FSI. The Assistant Director of Town Planning rejected the refund on 15.02.2020, citing no provision for refund in the Development Control Regulations. The appellants challenged this in the Bombay High Court via Writ Petition No. 9040 of 2021, which was dismissed on 17.11.2022 on the ground of no statutory provision for refund and also on delay, as the first writ petition was filed in 2018. The Supreme Court granted leave and allowed the appeal. The Court noted that the appellants sought refund on 13.08.2015, within three years of payment, and the authorities' inaction could not be attributed to them as delay. The Sub-Divisional Officer had recommended refund on 19.11.2015, but no action was taken, leading to Writ Petition No. 8586 of 2018, which was disposed of on 15.01.2020 directing a decision. The Assistant Director then passed the rejection order. The Supreme Court held that in the absence of a statutory bar, the authorities cannot retain the premium when the privilege was not availed. The principle of unjust enrichment does not apply as the appellants received no benefit. The Court set aside the High Court judgment and the rejection order, directing refund of ₹30,46,290/- with interest at 6% per annum from the date of payment till realization, within eight weeks.
Headnote
A) Refund of Premium - Unutilized FSI - Absence of Statutory Bar - The appellants paid premium for extra FSI but abandoned the project and did not utilize the privilege. The High Court dismissed refund claim citing no provision for refund. The Supreme Court held that in the absence of a statutory bar, the authorities cannot retain the premium when the privilege was not availed. The principle of unjust enrichment does not apply as the appellants received no benefit. The Court directed refund of ₹30,46,290/- with interest at 6% per annum from the date of payment till realization. (Paras 8-10) B) Delay and Laches - Refund Claim - Timely Application - The High Court dismissed the writ petition on ground of delay as the first writ petition was filed in 2018. However, the Supreme Court noted that the appellants sought refund on 13.08.2015, within three years of payment on 30.08.2012. The inaction of authorities on their request cannot be attributed to them as delay. The Court held that the appellants were not guilty of laches. (Paras 6-7) C) Recommendation by Sub-Divisional Officer - Administrative Recommendation - Binding Effect - The Sub-Divisional Officer recommended refund by letter dated 19.11.2015, but the authorities did not act. The Supreme Court considered this recommendation as supporting the appellants' claim, though not binding. The Court directed refund based on merits, not merely on recommendation. (Paras 6, 8)
Issue of Consideration
Whether the appellants are entitled to refund of the premium paid for extra FSI which they did not utilize, in the absence of a specific provision for refund in the Development Control Regulations.
Final Decision
The Supreme Court allowed the appeal, set aside the High Court judgment and the order dated 15.02.2020, and directed the respondents to refund ₹30,46,290/- to the appellants with interest at 6% per annum from the date of payment (30.08.2012) till realization, within eight weeks.
Law Points
- Refund of premium paid for unutilized FSI is permissible in absence of statutory bar
- Doctrine of unjust enrichment not applicable when no benefit received
- Delay cannot be attributed to applicant when authorities failed to act on timely request
