Nepotism & Self-Aggrandizement Anathema To Democratic System: Supreme Court Imposes Rs 1 Lakh Cost For HEWO’s Allotment Citing Favouritism

The Apex Court was dealing with an appeal involving the allotment of two super deluxe flats in the apartment complex built by the HUDA Urban Estate and Town and Country Planning Employees Welfare Organization (HEWO).

The Division Bench of Justice Sanjay Kumar and Justice K. Vinod Chandran stated, “Nepotism and self-aggrandizement are anathema to a democratic system, more so when it happens within a society comprising members of the government service, enabling housing facilities to its members by transparent allotment. The second respondent HUDA, Urban Estate and Town and Country Planning Employees Welfare Organization (for short, ‘HEWO’) is one such society registered under the Societies Registration Act, 1860.”

“We observe at the risk of repetition that on the last date of application the third respondent was not even an employee of HUDA or a governing body member of HEWO. The third respondent took charge as per Annexure P-11 on 12.08.2021 in HUDA, by virtue of which he became a governing body member of HEWO. There could have been no preferential allotment given to the governing body member who was not even satisfying the six months deputation period in the service of HUDA. We find absolutely no reason to uphold the allotment made to the third respondent which is a clear act of favouritism and blatant display of self-aggrandizement”, it added.

Advocate Pradeep Dahiya represented the Appellant while Sr. Addl. Advocate General Alok Sangwan represented the Respondent.

Factual Background

The appellant, admitted to the membership of HEWO, was eligible by way of his 14 years of deputation in the Haryana Urban Development Authority (HUDA)/ Haryana Shehri Vikas Pradhikaran (HSVP). One of the flats available was conceded to a governing body member, third respondent, based on a decision taken by HEWO in 2020, and in the picking of lots conducted for the one remaining flat, the fourth respondent turned out to be successful. The appellant challenged the allotment of the super deluxe flats to the third and fourth respondents, alleging them to be ineligible and accusing HEWO of favouritism, to both its governing body member, the third respondent and his subordinate, the fourth respondent. The respondents, HEWO and the beneficiaries, resisted the writ petition.

The third respondent was a governing body member, so enabled preference by an earlier decision, and the fourth respondent satisfied the basic pay requirement, which alone was the consideration as per the decision of the Governing Body. The appellant had participated and lost and hence could not challenge the allotment, which was the defence.

The Division Bench of the Punjab and Haryana High Court found invocation of Article 226 to be proper. The Division Bench held that since the allotment made earlier to a governing body member was surrendered, the same was allotted to the third respondent, and the fourth Respondent was granted allotment on the draw of lots, in which the appellant also participated and so he became estopped from challenging the same.

Reasoning

The Bench, at the outset, explained that the membership of the HEWO is open to serving and retired employees of HUDA, spouses of deceased HUDA employees, employees of the subsidiaries of HUDA, personnel of HEWO and employees deputed to HUDA who have a minimum of six months of service on deputation.

On a perusal of the facts of the case, the Bench noted that before the completion of the time stipulated on May 25, 2021, the meeting of the governing body members, with one K. Makrand Pandurang presiding, allotted one of the super deluxe flats to the said presiding member. The balance flat was decided to be floated amongst the eligible employees of HUDA. Admittedly, the appellant applied under the advertisement and was eligible on all counts, satisfying both the deputation period, the basic pay requirements as well as being in level 11 of the pay band. “Hence, as on the date of allotment, there was not even the membership fees deposited by the 3rd respondent, leave alone the submission of an application along with earnest money deposit, before the last date”, it stated.

It was further noted that the fourth respondent was working as an Accountant with the office of the Chief Controller of Finance, HUDA, Panchkula, which office was held by the third respondent. As per the Bench, the third respondent’s entry to HUDA and, as a consequence, to HEWO not only facilitated preferential allotment to himself but also to his subordinate. “We find no reason to uphold the allotment to the fourth respondent also”, it added.

Considering the gross abuse of powers and authority carried out, the Bench set aside the judgment of the Division Bench of the High Court and allowed the appeal imposing costs of Rs 1 lakh on the second respondent, with further costs of Rs.50,000 on the third respondent and costs of Rs 25,000 on the fourth respondent.

“The second respondent shall carry out a fresh draw of lots with respect to the two super deluxe flats from the four eligible applicants available at the earlier point of time, after obtaining their consent. If there is only one person left, then one of the super deluxe flats shall be allotted to the appellant and he shall be given time of six months from the date of allotment to make the deposit. It is also made clear that if the other applicants are not desirous of allotment, then the second respondent would be entitled to make a re-allotment of the flat left over based on the existing eligibility as of now”, it ordered.

Cause Title: Dinesh Kumar v. The State of Haryana and Ors. (Neutral Citation: 2026 INSC 163)

Appearance

Appellant: Advocates Pradeep Dahiya, Mahima Benipuri, Rakshit, AOR Sunny Kadiyan

Respondent: Sr. Addl. Advocate General Alok Sangwan, Senior Advocate Shadan Farasat, AOR Samar Vijay Singh, AOR, Advocates Sumit Kumar Sharma, Rajat Sangwan, Aman Dev Sharma, Sabarni Som, Gaj Singh, Harsh Mehla, Divya Sharma, AOR Bharat Gupta, Advocates Sansriti Trivedi, Sarah Sunny, Suvarna Swain, AOR Shirish K. Deshpande, Advocates Rucha Pravin Mandlik, Raghav Arora, Viraj Parakh, Adv Deepak Jindal

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