Forced migration cannot be treated as abandonment to justify the cancellation or re-allotment of industrial leasehold property.

The petitioner, a sole proprietorship concern of Sh. K. L. Ambardar, was a registered small-scale industrial (SSI) unit allotted Shed No. 5 at Bagh-i-Ali Mardan Khan Industrial Area, Srinagar, in 1978.

Following the mass migration of Kashmiri Pandits in 1989, the proprietor migrated to Jammu for safety, leading to the abandonment of the unit.

In 1991, a fire damaged the industrial area, including the petitioner’s shed.

Subsequently, the State re-allotted the site of Shed No. 5 to Respondent No. 6.

In a previous round of litigation (OWP No. 488/1996), the High Court directed the respondents to either provide a similar shed to the petitioner or cancel the allotment to Respondent No. 6.

While the State offered alternative sheds at Rangreth, it demanded premium payments and significantly higher rent compared to the original allotment.

Ultimately, via Order No. IDC/B/2004/73 dated 06.04.2004, the respondents cancelled the alternative allotment, citing the petitioner’s failure to complete formalities and pay premiums.

The petitioner challenged this cancellation and sought restoration of the original shed.

1. Whether the State's action in cancelling the petitioner’s industrial allotment and imposing harsher financial terms for alternative sites during the proprietor's forced migration was legally and equitably sustainable.

2. Whether the official respondents failed in their constitutional and administrative duty to protect the property of a Kashmiri migrant.

The Court applied the principles of Natural Justice, holding that vested entitlements cannot be prejudiced without due process, especially under extraordinary circumstances like forced migration.

It further relied on the Doctrine of State Responsibility, which mandates that the State act as a protector, not a predator, of the properties of citizens displaced by turmoil.

The court also invoked the Principle of Equity, requiring that administrative actions accommodate the "misery" of circumstances beyond a citizen's control to prevent unfair and inequitable treatment.

The Court observed that the petitioner was forced to abandon his industrial unit due to historic circumstances of mass migration, a fact the State should have acknowledged as a "solemn obligation" to protect his leasehold interests.

Instead, the respondents took advantage of the petitioner’s absence to re-allot his original site to a third party.

The Court characterized the State’s conduct as acting like a "predator" rather than a "protector" of migrant property.

It found that the alternative allotment at Rangreth was a "mirage" and "eyewash" because the State imposed new commercial terms (premiums and higher rent) instead of honoring the original lease conditions.

The Court further held that it was unreasonable for the State to expect the petitioner to restore industrial activity or complete formalities during a period when the safety of the Kashmiri Pandit community was not secured.

Consequently, the cancellation of the alternative allotment for failure to pay premiums was deemed a violation of natural justice and equity.

It disposed of the writ petition with a mandamus directing the official respondents to: (i) allot two sheds at the Industrial Estate, Rangreth (or similar available sheds) to the petitioner; (ii) waive any requirement for premium payments for said allotment; and (iii) charge rent only at the prevalent rate prospectively from the date of actual possession, without insisting on any past arrears.

The Court quashed the effect of the previous cancellation order to facilitate this restorative relief.