DDA Allotment Policy Does Not Extend Re-sitement To Cancelled Petrol Pump Sites: Delhi HC

The Delhi High Court dismissed a Letters Patent Appeal (LPA) filed by a petrol pump dealer, affirming that a party who suppresses material facts and continues in unauthorized occupation of government land after allotment cancellation cannot claim benefits under re-sitement policies. The Court emphasized that equity does not favor litigants who approach the judiciary with 'unclean hands' and fail to disclose vital documents.

A division bench comprising the Hon'ble Chief Justice Devendra Kumar Upadhyaya, and Justice Tejas Karia presided over the challenge against a Single Judge's decision. The matter involved the cancellation of a petrol pump allotment by the Delhi Development Authority (DDA) in 1997 and the subsequent decade-long unauthorized operation of the site by the dealer.

Knowledge of Cancellation and Suppression of Facts

The Appellant contended that she was unaware of the 1997 cancellation notice until 2007 and that principles of natural justice were violated as no show-cause notice was served via registered post under Section 43(1) of the Delhi Development Authority Act, 1957. However, the Court found documentary evidence, including a letter written by the Appellant just six days after the cancellation notice, specifically seeking 'restoration' of the allotment.

The Court, in its reasoning, observed: "A person who is unaware of the cancellation notice cannot, in the ordinary course, write seeking restoration of the very allotment that stands cancelled. The Appellant’s own communication dated 02.09.1997 thus constitutes clear and compelling evidence of her knowledge of the Cancellation Notice from the very inception... It is a settled principle that a litigant who suppresses material facts and approaches a Court of equity with unclean hands is not entitled to discretionary relief."

Scope of Re-sitement Policy and Statutory Estoppel

Regarding the claim for an alternative site, the Court held that the DDA's re-sitement policy applies only to 'lawfully existing' outlets. Since the allotment was cancelled in 1997, the Appellant’s continued occupation was deemed unlawful, citing Planet M. Retail Ltd. v. Select Infrastructure Pvt. Ltd.. The Court also rejected the argument that the DDA waived its right to cancel the allotment by accepting lease rentals, referencing Rajasthan State Industrial Development & Investment Corpn. v. Diamond & Gem Development Corpn. Ltd. ( "(2013) 5 SCC 470": 2013 CaseBase(SC) 197) and Pratima Chowdhury v. Kalpana Mukherjee and Another ( "(2014) 4 SCC 196": 2014 CaseBase(SC) 507) to clarify that estoppel cannot be invoked against a statutory authority to create entitlements contrary to policy.

Final Directions and Cost Imposition

Finding no merit in the appeal and noting the deliberate concealment of documents, the Court dismissed the appeal with exemplary costs. The Court has the following directions:

"The Appellant and Respondent No. 2 are directed to hand over vacant and peaceful possession of the petrol pump site to the DDA forthwith, if the same has not already been handed over. In the facts and circumstances of the present case, and particularly in view of the suppression of material facts, it is evident that the Appellant has approached this Court with unclean hands and has unnecessarily burdened the Court with an unmeritorious Appeal. Accordingly, by way of deterrence against such conduct, we deem it just and proper to impose costs of ₹50,000/- (Rupees Fifty Thousand only) upon the Appellant, which shall be paid to the DDA within a period of two weeks from the date of this Judgment."

Case Details:
Case No.: LPA 269/2025
Case Title: USHA RANI GUPTA v. DELHI DEVELOPMENT AUTHORITY & ANR.
Appearances:
For the Petitioner(s): Mr. Sanat Kumar, Senior Advocate with Mr. Sanjay Sharma and Mr. Vinayak Batta, Advocates.
For the Respondent(s): Mr. Tushar Sannu, Mr. Vaibhav Tripathi and Mr. Praveen Bansal, Advocates for R-1 (DDA); Ms. Mala Narayan, Mr. Shashwat Goel and Ms. Anjali Dhingra, Advocates for R-2 (IOCL).

Source: 2026 CaseBase(DEL) 414