HSVP Cannot Charge 'Current Price' From Oustees For Delayed Allotments Of Plots: Punjab & Haryana High Court Imposes ₹3 Lakh Cost

The Punjab and Haryana High Court has held that the Haryana Shehri Vikas Pradhikaran (HSVP, formerly HUDA) cannot charge the current reserve price for plots allotted to land oustees when the delay in allotment is attributable to the authority itself. The Court further ruled that levy of 11% interest is not “reasonable interest” within the meaning of the Full Bench judgment in Rajiv Manchanda v. HUDA and directed that 5.5% interest be charged instead.

The Court was dealing with a bunch of writ petitions, all raised similar questions of law relating to price fixation, interest, and mode of payment for plots allotted to oustees.

Justice Anupinder Singh Grewal and Justice Deepak Manchanda said, "pursuant to which the mandate has also been accepted and duly incorporated in the policy, by the respondent then charging the current price through the impugned allotment letter, without any reasoning, is not acceptable."

Speaking for the bench Justice Deepak Manchanda imposed a cost of Rs. 3 lakhs, observing that, "What is even more surprising is that despite amending policies and issuing instructions from time to time, many of which themselves acknowledged these principles-the respondents have still failed to comply with the settled legal position and has arbitrarily charged the current price and delayed the process of issuance of the allotment letter for approx seven years."

Such conduct on the part of the respondents is wholly unjustified, cannot be appreciated, and deserves to be deprecated. In view of the same, as a punitive measure, we are constrained to impose the costs of Rs.3 lakhs on the respondent-HSVP, it added.

The petitioner's land in Village Sonda, District Ambala, was acquired in 2001 for development of Sector-24, Urban Estate, Ambala. In response to an HSVP public notice dated 05.11.2018 inviting online applications under the oustee quota, the petitioner applied on 24.12.2018 and deposited the required earnest money.

However, after a delay of nearly six to seven years, HSVP issued an allotment letter in May 2025, charging the current reserve price for 2025–26 (₹58,172 per sq. meter) instead of the rate prevalent in 2018 (₹21,500 per sq. meter). The allotment letter also required payment of the remaining 75% amount within 180 days and imposed 11% interest.

Aggrieved, the petitioner approached the High Court challenging the allotment conditions as being contrary to settled law and oustee policy.

The Court identified three core issues for adjudication:

Whether HSVP could charge the current price (2025) instead of the rate prevailing at the time of application/advertisement (2018).

Whether charging 11% interest amounted to “reasonable interest” as envisaged in Rajiv Manchanda.

Whether restricting payment of the remaining amount to 180 days was justified, or whether payment in six annual installments should be permitted.

The Court held that charging the current price was in clear violation of the Full Bench judgment in Rajiv Manchanda and Clause 15-A of the policy dated 08.05.2018.

The deliberate omission of price disclosure in the 2018 advertisement could not be used by HSVP to later justify charging escalated rates.

The Court found HSVP's conduct arbitrary, discriminatory, and mala fide, noting that the delay in allotment was entirely attributable to the authority.

On interest, the Court ruled that 11% interest was not supported by Rajiv Manchanda, which only spoke of “reasonable interest.” Given that HSVP itself charged lower rates under other schemes, the Court fixed 5.5% interest as reasonable.

On payment terms, the bench held that insisting on payment of 75% within 180 days was discriminatory, especially when similarly placed oustees had been granted six years' installment facility, as upheld in Naresh v. State of Haryana.

Allowing the petitions, the High Court, quashed Clauses 5 and 6 of the allotment letter dated 09.05.2025 and directed HSVP to re-determine the price based on the rate prevailing at the time of the 2018 application/advertisement.

It also held that interest shall be 5.5% per annum, not 11% and allowed payment of the remaining amount in six equal annual installments.

Directing the compliance within two months, the Court restrained HSVP from taking coercive steps meanwhile.

Title: Ram Lal Mahendru v. State of Haryana and others

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