"Punjab and Haryana HC Overturns Rule Requiring Developers to Forfeit Land and Fees on License Surrender"

Dated on: Monday 5th May 2025

The Punjab and Haryana High Court has invalidated a 2020 amendment to Haryanas urban development rules that mandated real estate developers surrendering their licences to forfeit significant fees and land without compensation. The court deemed these provisions excessive, legally unsound, and infringing on developers constitutional rights. This ruling came after a developer challenged the states demand to forfeit Rs 31.76 crore and transfer 4.4 acres of land, despite the states failure to provide promised infrastructure. The court held that such forfeitures amounted to unjust enrichment and lacked legal justification. While the state may claim interest on certain fees, the principal amounts already paid cannot be forfeited.