A proposed software and ITES park developer challenged de-notification of land never allotted to it. The Court dismissed the petition for lack of locus standi, holding that project approval and investment created no vested right in the subject land. Other challenges to de-notification were left unexamined.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
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IN THE HIGH COURT OF KARNATAKA, BENGALURU
DATED THIS THE 1st DAY OF AUGUST 2022
BEFORE
THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR
WRIT PETITION No.19622 OF 2011 (GM-KIADB)
BETWEEN:
AUGUST VENTURES (P) LIMITED HAVING ITS REGD OFFICE AT 17/1,CAMPBELL ROAD, BANGALORE-560047REPRESENTED HEREIN BY ITS MANAGINGDIRECTOR, MR.BIJU JOHN
…PETITIONER
(BY SRI. A.S. PONNANNA, SR. COUNSEL APPEARING FOR SRI. ROHAN HOSMATH, ADVOCATE)
AND:
ITS MANAGINGDIRECTOR.
REPRESENTED BY ITS SECRETARY TO GOVERNMENT, COMMERCE AND INDUSTRIES DEPARTMENT.
M.S.BUILDING, DR. AMBEDKAR VEEDHI
BANGALORE – 560 001.
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| 5 . | K MEENA W/O LATE RAMAKRISHNA REDDY AGED ABOUT 50 YEARS. |
|---|---|
| 6 . | MR GAJENDRA S/O LATE RAMAKRISHNA REDDY AGED ABOUT 27 YEARS. |
| 7 . | MR SUDARSHANA REDDY S/O LATE RAMAKRISHNA REDDY AGED ABOUT 25 YEARS. |
| 8 . | MS SAVITHRAMMA W/O LATE DODDA HANUMAPPA REDDY AGED ABOUT 65 YEARS. |
| 9 . | MR SHIVARAMA REDDY H S/O LATE DODDA HANUMAPPA REDDY AGED ABOUT 48 YEARS. |
| 10 . | MR H RAJASHEKHARA REDDY S/O LATE DODDA HANUMAPPA REDDY, AGED ABOUT 39 YEARS. |
| R-5 TO R-10 ARE R/A SHIVARAMA REDY BLDG., 2NDCROSS,CHOWDESHWARI LAYOUT, NEXT TOTULASI THEATRE, MARATHALLI POST VARTHUR HOBLI, BANGALORE SOUTH TALUK-560 037. |
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| 11 . | MS THIMMAKKA W/O LATE HANUMAPPA AGED ABOUT 90 YEARS. |
| 12 . | MR ANAJANAPPA S/O LATE HANUMAPPA AGED ABOUT 61 YEARS. |
| 13 . | MS AMMAYYAMMA @ VAJRAMMA W/O ANAJANAPPA AGED ABOUT 55 YEARS. |
| 14 . | MR RAVI S/O ANAJANAPPA AGED ABOUT 35 YEARS. |
| 15 . | MS VASANTHA W/O RAVI AGED ABOUT 30 YEARS. |
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R-11 TO R-25 ARE R/A 2ND MAIN ROAD, CHOWDESHWARI LAYOUT, MARATHHALLI, BANGALORE-560 037. 26 . MR MURALI S/O LATE M A KRISHNA REDDY AGED ABOUT 50 YEARS, R/O NO.67, NEAR RAM NURSING HOME
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MARATHALLI POST, VARTHUR HOBLI, BANGALORE SOUTH TALUK, BANGALORE-560 037.
27 . MS RADHA W/O K SRINIVASA REDDY D/O LATE M A KRISHNA REDDY AGED ABOUT 32 YEARS, R/A NEAR SHYAMALA NURSING HOME MUNNEKOLLALA, VARTHUR HOBLI,BANGALORE SOUTH TALUK, BANGALORE-560 037
R- 5 TO R- 27 ARE R/BY THEIR GPA HOLDER KAPIL SARIN.
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(BY SRI. A.C.BALARAJ, AGA FOR R-1 & R-4 SRI. UDAY HOLLA, SR. COUNSEL APPEARING FOR SRI. P.V. CHANDRASHEKAR, ADVOCATE FOR R-2 & R-3 SRI. SHASHIKIRAN SHETTY, SR. COUNSEL APPEARING FOR SMT. LATHA SHETTY, ADVOCATE FOR R-5, R-6, R-8, R-10 TO R-35, R-37, R-41, R-43, R-47, R-48, R-50, R-52, R-54 TO R-58 C/R- 28 TO R-34 R-9, R-36, R-42, R-44, R-45, R-46, R-49, R-51, R-53 ARE SERVED)
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THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED DENOTIFICATION ORDER BEARING NO.CI 169 SPQ 2008 DATED 2.11.2010 ISSUED BY THE RESPONDENT NO.4 AS PER ANNEXURE-A AND ETC.
THIS W.P. IS BEING HEARD AND RESERVED ON 23.07.2021 COMING ON FOR PRONOUNCEMENT OF ORDER THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER
In this petition, petitioner has sought for the following
reliefs:-
“ (i) Issue a writ of certiorari or any other writ to quash the impugned denotification order bearing No.C1 169 SPQ 2008 dated: 2.11.2010 issued by the Respondent No.4 as per Annexure ‘A’ hereto;
(ii) Issue a writ of mandamus or any other writ directing the Respondent Nos.2 to 4 to convey the Petition Schedule Property to the Petitioner and place them in possession of the same upon receiving the entire sale consideration as per the terms of sanction at Annexure ‘C’ hereto;
(iii) To pass such other order/orders as this Hon’ble Court may deem fit to grant under the circumstances of the case, in the interest of justice and equity. ”
petitioner are as under:-
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2.1 The petitioner is a Company incorporated under
the Companies Act,1956, intending to put up a "Software Development and ITES Park" as a Single Unit Complex in the total extent of 16 acres 8 guntas at Survey Nos.117, 118, 138, 139, 140, 141 and 142 of Bellandur Ammanikane Village, Varthur Hobli, Bangalore East Taluk, Bangalore, for which, the petitioner had submitted an application on 15.10.2003 along with a processing fee of Rs.25,000 to the respondent No.1 for allotment of said land to put up the aforementioned Project.
2.2 Upon submission of the application by the petitioner, the respondent No.1 vide letter dated 30.10.2003 informed the petitioner about the approval granted by the State Level Single Window Clearance Committee (SLSWCC) in its 234th Meeting held on 20.10.2003 and resolved to recommend the KIADB for acquiring the total extent of 16 acres 8 guntas of land and allot the same to the petitioner for implementation of the project. Pursuant to approval of the Project of the petitioner by the State Committee, the petitioner had submitted an application to the respondent No.2 on 07.11.2003 for allotment of the said
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land. Since there was no response from the 2nd respondent, the petitioner wrote a letter on 10.07.2004 to the 1st respondent and similarly to the respondent Nos. 2 and 4.
2.3 Petitioner vide its letter dated 19.07.2005 informed the respondent Nos.2 and 4 about the Bangalore Development Authority(BDA) being the local Planning Authority under the Karnataka Town and Country Planning Act, 1961 had issued a Preliminary Notification during June 2005 calling for objections to the Notification of Revised Master Plan 2015. The petitioner vide letter dated 05.09.2005 addressed to the 1st respondent sought for immediate acquisition of land and hand over to the petitioner and also has asked for renewal of the project approval up to the period till the petitioner gets land and all other infrastructural assistance as approved by the State Level Single Window Agency. By way of reply, the 1st respondent vide letter dated 29.10.2005 informed that the State Committee has approved for extension of time by a period of one year.
2.4 The Government of Karnataka through its notification dated 10.12.2001 bearing reference No.CI 255
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SPQ 2001 issued under Section 3(1) of the Karnataka Industrial Areas Development Act (KIADB Act), declared the said land including the schedule property as ‘Industrial Area’ and in view of the Section 47 of the KIADB Act, the same shall supersede the Karnataka Town and Country Planning Act, 1961. Subsequently, the 3rd respondent as per its Preliminary Notification under Section 28(1) of the KIADB Act issued a Notification dated 09.02.2004 for acquisition of the schedule property. Upon hearing the objections from the landowners, the 3rd respondent issued a Final Notification dated 19.12.2005 under Section 28(4) of the KIADB Act for acquisition of the schedule property. Pursuant to the Final Notification, the petition schedule property has vested with the State Government free from all encumbrances as per the provisions of Section 28(5) of the KIADB Act.
2.5 The petitioner vide its letter dated 24.02.2006 addressed to the 2nd respondent has brought to the notice of the KIADB officials that there is an issue of shortage of lands notified by the KIADB leaving the extent of 4 acres 15 guntas out of the approved land of16 acres 8 guntas for
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the project. Further, on 15.03.2006, petitioner addressed a letter to the 1st respondent to pursue the matter with KIADB on leaving out few lands which are essential for the implementation of the project. Further, the petitioner vide its letter dated 26.12.2006 addressed to the 2nd respondent requesting them to allot the approved land and issue a allotment letter for implementation of the Project and also reminded that the allotment letters have been issued to similarly situated projects in the vicinity.
2.6 The respondent No.1 vide its letters dated 26.03.2007 and 04.04.2007 requested the petitioner to inform the status of the implementation of approved project. By way of reply, the petitioner vide letters dated 03.04.2007 and 02.05.2007 provided the status of the project and requested the aforesaid respondents to hand over the approved land expeditiously to the petitioner. The petitioner vide letters dated 14.11.2007 and 10.03.2008 addressed to respondent Nos.2 and 3 and requested them to allot the approved land and issue the allotment letter, so that the petitioner can start the project at the earliest and also requested to fix the boundaries of the land allotted.
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2.7 The petitioner once again vide its letter dated 26.04.2008 requested the 2nd respondent to allot the land already notified by the KIADB and available for allotment in lieu of the shortage of land allotted out of the approved land. The petitioner also vide letter dated 23.05.2008 addressed to the 3rd respondent informed that the 2nd respondent has directed the surveyor to survey and fix the boundary for only 12 acres 7 guntas of land, which is available for the petitioner. In this regard, the petitioner requested the 2nd respondent to approve the same and issue an allotment letter at the earliest.
2.8 The 2nd respondent by way of letter dated 18.02.2010 directed the petitioner to pay a sum of Rs.1,05,00,000/- towards 40% cost of land at the tentative rate of Rs.150/-lakhs per acre in respect of 1 acre 30 guntas of the subject land in Survey Nos.138/5, 138/6, 139/2,139/3 and 139/4 of Bellandur Ammanikane Village, Varthur Hobli, Bangalore East Taluk, Bangalore. The petitioner vide letter dated 17.03.2010 has informed about the payment of aforesaid amount to the 2nd respondent. Thereafter, the 2nd respondent issued the allotment letter in
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favour of the petitioner to an extent of 1 acre 30 guntas by way of their letter dated 03.04.2010. However, the subject lands have not been included in the said allotment letter.
2.9 The respondents 5 to 54 have filed W.P.No.3514/2008 before this Court challenging the acquisition proceedings in respect of the notified lands including the subject lands, but the petitioner was not a party to the said proceedings. In the said petition, the Chief Secretary filed a detailed Affidavit on 18.09.2010 supporting the acquisition proceedings. It is contended that despite the said Affidavit, the KIADB passed a Board Resolution on 27.09.2010 not to proceed with the acquisition which is contrary to the said Affidavit. It is contended that the petitioner was deliberately not impleaded as a party to the said petition and the impugned de-notification which is contrary to the Affidavit is illegal and arbitrary on this ground also and that therefore, the petitioner sought for impleadment in the said petition.
2.10 The 2nd respondent has issued a notification dated 02.11.2010 under Section 4 of the KIADB Act dropping 3 Acres 13 Guntas 24 Cents of land in various
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survey numbers of Ammani Bellandur Khane Village, Varthur Hobli, Bangalore East Taluk, as the lands are not required for the Government. Upon receiving the said information, the petitioner has sent a letter dated 16.11.2010 addressed to 1st respondent to inform the 2nd respondent not to denotify the schedule property as it has already been approved for allotment in favour of the petitioner.
2.11 The 4th respondent has filed a Memo dated 03.01.2011 in W.P.No.3514/2008 enclosing the impugned notification for de-notifying the lands on the same day when the writ petition and the impleadment application of the petitioner were listed for hearing. By order dated 03.01.2011, this Court dismissed aforesaid writ petition filed by respondent Nos.5 to 58 and also held that the impleadment application does not survive for consideration.
2.12 The petitioner has urged various grounds in support of its contentions. It is contended that the petitioner also informed the respondents that BDA intends to earmark Survey Nos.117,118,138,139,140,141 and 142 of the said subject lands for residential use. It is also submitted that
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the BDA was also a special invitee to the Meeting of the State Committee, in which the Project of the petitioner was approved and has not raised any objections for the allotment of the said land. The 4th respondent issued a notification to de-notify the schedule property and the petitioner was not given an opportunity of hearing. It is also contended that once the possession is taken, the subsequent de-notification is not permissible under the Land Acquisition Act or the KIADB Act and thus the acts leading to the de-notification of the land is unconstitutional.
2.13 Petitioners also contend that the subject land
was declared as an industrial area even prior to the notification of RMP 2015. The Revised Master Plan of 2015 is only prospective and not retrospective. The respondent Nos.2 and 4 are estopped from acting contrary to their Affidavit and Statement of Objections filed in the writ petition. The Comprehensive Development Plan of 1995 notified under the Karnataka Town and Country Planning Act was superseded by the Revised Comprehensive Development Plan of 2015 which was notified on 25.06.2007 by the State, up to which the old CDP, 1995
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was in force. It was therefore contended that the petitioner was entitled to the relief’s sought for in the petition.
2.14 The respondents 2 and 3-KIADB have filed their objections inter-alia disputing and denying the various allegations and claim made by the petitioner and contended that there is no merit in the petition and that the same is liable to be dismissed. It is contended that Section 4 of the KIAD Act provides that deletion and addition can be done at any time. Petitioner claiming to be the applicant have no right to question the de-notification issued by the Government. It is a settled law that no one can compel the Government to acquire the land. The Government has power to withdraw or rescind the notification as per Section 21 of General Clauses Act. Petitioner has no legal enforceable right to demand that particular land be acquired and allotted. It is therefore contended that the petition is liable to be dismissed.
2.15 The respondent No.4-State has also filed its statement of objections inter-alia disputing and denying the various allegations and claim made by the petitioner and contending that there is no merit in the petition and that the
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same is liable to be dismissed. It is contended that the petition is not maintainable in view of the law laid down by the Apex Court and this Court with reference to Section 47 of the KIADB Act and Section 76M of the Karnataka Town and Country Planning Act, 1961 as can be seen from the decisions detailed in the statement of objections.
2.16 It is also contended that the KIADB decided to delete the lands from acquisition because the lands were notified to be in sensitive valley zone. It is necessary that the State must act in conformity with established principles of sustainable development and in view of the same, the KIADB de-notified the subject lands. KIAD Act is a distinct and separate Act and in view of Section 4 of KIADB Act, it is clear that anytime the industrial area can be altered. Petitioner’s contentions are devoid of merit as the lands were de-notified due to the fact that a portion of lands were part of valley zone. The Industrial Facilitation Act, 2002 does not create any right in favour of the petitioner and thus, an opportunity of being heard is not required. It is therefore contended that the petition is liable to be dismissed.
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2.17 The private respondents 5 to 58 have also filed a separate statement of objections inter-alia disputing and denying the various allegations and claim made by the petitioner and contending that there is no merit in the petition and that the same is liable to be dismissed. It is contended that the acquisition proceedings were initiated much prior to the application filed by the petitioner before the State Committee. De-notification of land is entirely between the State Government, KIADB and the respondents herein, as to whether the lands should be acquired or deleted. The project approval is only for period of 2 years and there is no further extension of time. Therefore, the petitioner has no valid approval for the project. Petitioner has no locus standi to challenge the impugned notification, as KIADB is a beneficiary of the acquisition and the petitioner has not been allotted the land in question and therefore the de-notification cannot be challenged by a stranger and petitioner has no legal right over the property in question. As no allotment letter was issued and possession was not granted in favour of the petitioner, thus there is no locus standi . Possession
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continues to be with Respondents 5 to 58 only. The contention of petitioner that respondents 2 and 3 have taken possession is false and baseless.
2.18 It is contended that the acquisition of land by
the State Government is for the purpose of use by the KIADB and that the State Government has passed the impugned notification only after verifying both files of the petitioner and respondents and also comprehensive development plan which clearly shows that the subject land falls under valley and residential zone and cannot be used for industrial purpose and no industrial activity can take place. Thus, writ petition is liable to be dismissed. It is also pointed out that the challenge to de-notification in respect of Sy.Nos.144/1 and 145 does not arise, as there is no application filed by the petitioner in respect of above land and is an abuse of process of law. The subject land is surrounded by a private property, wherein residential sites are formed and is situated in the middle of the residential property. The acquisition made under the KIADB Act is entirely different from approval of project of the petitioner, as the Industrial Facilitation Act, 2002 provides only
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approvals and no allotment of land is made. The petitioner has chosen to challenge the de-notification only in respect of the subject property belonging to the private respondents. The decision taken in 234th meeting does not create any right in favour of the petitioner over the respondents.
2.19 It is contended that the petitioner has not approached this Court with clean hands and has made factually incorrect averments and that the petition is liable to be dismissed. The State Committee has no legal sanctity and statutory force and cannot make any recommendation in matter of land acquisition. Even assuming there is power to make recommendation, there cannot be acquisition for the land, which are earmarked as valley and residential zone. All statutory powers especially the power to compulsorily acquire the property of a citizen vests in public domain and any violation of the statutory provisions resulting in rights of citizen to hold property is defeated is not only illegal but also breach of trust and abuse of the statutory powers vested with the State.
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2.20 The petitioner has filed its rejoinder disputing
and denying the various contentions and claims put forth in the statement of objections filed by respondents 5 to 58 and has contended that the petition deserves to be allowed.
appearing for the petitioner and learned AGA for the respondent – State, Sri.Uday Holla, learned Senior counsel appearing for the respondents - KIADB, learned as well as Sri.Shashi Kiran Shetty, learned Senior counsel appearing for contesting respondents and perused the material on record.
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1. Indore Development Authority vs Manoharlal & Ors., - SLP 9036-9038/2016;
2. Ramaswamy vs The State of Karnataka and Ors., - WP No.3095 of 2006 disposed on 03.12.2008;
3. Smt.Roopa Ashok Lakhant vs The State of Karnataka and Anr., - WP No.10316 of 2017 disposed on 01.06.2009;
4. Ramaswamy vs The State of Karnataka and Ors., - WA No.160 of 2009 disposed on 14.09.2009;
5. The Special Land Acquisition Officer and Anr. vs Smt. Nirmala and Ors., - WA No.1947 of 2008 and connected matters disposed on 26.11.2012;
6. Sri V Srinivas vs M/S Mysore IT Solutions Pvt Ltd. and Ors.,- RP No.295 of 2013 in WA No.1495 of 2008 and connected matters disposed on 10.11.2016;
7. Indrapuri Grihanirman Sahakari Samiti Ltd. vs State of Rajasthan - (1975) 4 SCC 296;
8. Hari Singh and Ors. Vs State of UP and Ors., - (1984) 2 SCC 624;
9. Tamil Nadu Housing Board, Chennai vs M Meiyappan and Ors., - (2010) 14 SCC 309
10. A.Damodar vs State of Karnataka and Ors., - WA No.467 of 2012 disposed on 01.06.2012;
11. Kandekutty and Ors. Vs State of Kerala and Ors., - (1997) 9 SCC 336;
12. Shanti Sports Club and Anr. vs Union Of India and Ors., - (2009) 15 SCC 705;
13. Balak Ram Gupta vs Union of India, - AIR 1987 Del 239;
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14. M. Nagabhushan vs State of Karnataka and Ors., - (2011) 3 SCC 408;
15. V. Chandrasekaran and Anr. vs Administrative Officer and Ors., - (2012) 12 SCC 133;
16. Mrs.Premakala Prabhakara Reddy and Anr. vs State of Karnataka, Department of Industries and Commerce Industrial Development and Ors.,- ILR 2019 KAR 2441;
17. M.S.Moses vs State of Karnataka - ILR 1991 KAR 770;
18. C.Prakash vs State of Karnataka and Ors. - WA No.333 of 2013 Dated 23.06.2014;
19. P.Narayanappa and Anr. vs State of Karnataka and Ors., - (2006) 7 SCC 578;
20. N.Rajanna and Ors. Vs State of Karnataka - (2010) 6 SCC 596;
21. M/S Moola Investments vs The State of Karnataka and Ors.,- WA No.2399 of 2010 on 09/02/2015 (Para 9)
22. Base Corporation Limited vs KIADB, Bangalore and Ors., - (2011) SCC Online Kar 4108;
23. Lakeview Tourism Corporation vs The State of Karnataka and Ors., - WP No.22888 of 2010 dated 28/11/2012;
24. S.P Chengalvaraya Naidu(Dead) by LRS. vs Jagannath(Dead) by LRS and Ors., - (1994) 1 SCC 1;
25. Shivkumar and Anr. vs Union of India and Ors., - (2019) 10 SCC 229;
26. The Commissioner BDA and Ors. vs State of Karnataka by its Secretary and Ors., - ILR 2006 KAR 318;
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27. Karnataka Industrial Area Development Board and Anr. vs M.Mahadevappa and Ors., RP Nos.948 of 2013 and 10-26 of 2014 in WA No.5289 of 2012 & 1854-1870 of 2013 dated 09/01/2014; and
28. Thomas Patrao Since Deceased by his LR and Anr. vs State of Karnataka - ILR 2005 KAR 4199;
1. Shri Peerappa Hanmantha Harijan vs State of Karnataka And Anr., - (2015) 10 SCC 469;
2. Satish Kumar Gupta and Ors. Vs State of Haryana and Ors., - (2017) 4 SCC 760;
3. Thomas Patrao Since Deceased by his LR and Anr. vs State of Karnataka - ILR 2005 KAR 4199;
4. State of Madhya Pradesh and Ors. Vs Vishnu Prasad Sharma and Ors., - AIR 1966 SC 1593;
5. Master Marine Services (P) Ltd. vs Metcalfe & Hodgkinson (P) Ltd and Anr., - (2005) 6 SCC 138;
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6. Air India Ltd vs Cochin International Airport Ltd., - (2000) 2 SCC 617;
7. Prudential Housing & Infrastructure Development Ltd vs State of Karnataka - 2010 SCC OnLine Kar 4050;
8. H.G Sheela vs State of Karnataka and Ors., - 2006 SCC OnLine Kar 67;
9. Special Land Acqusition Officer, Bombay and Ors. Vs M/s Godrej and Boyce - (1988) 1 SCC 50;
10. Mrs.G.N. Annapurnamma and Anr. vs The Under Secretary and Ors., - WP No.19467 of 2016; 11. Brightsword Technologies Pvt. Ltd. vs The Karnataka Industrial Area, WP No.42253 of 2011 c/w WP No.45347 of 2011 dated 06.03.2013;
12. Bondu Ramaswamy vs Bangalore Development Authority - (2010) 7 SCC 129;
13. Forward Foundation vs State of Karnataka - OA No.222/2014;
14. Mantri Techzone Pvt. Ltd. vs Forward Foundation and Ors., - Civil Appeal No.5016 of 2016 dated 05.03.2019;
15. M.C Mehta vs Union of India - (2004) 6 SCC 588;
16. Thomas Patrao Since Deceased by his LR and Anr. vs State of Karnataka - ILR 2005 KAR 4199;
17. Special Land Acquisition Officer vs Godrej and Boyce - (1998) 1 SCC 50;
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18. M. Nagabhushana vs State of Karnataka - (2011) 3 SCC 408;
19. Special Land Acquisition Officer vs State of Karnataka - ILR 2007 KAR 4891;
20. A.Janardhan Shetty vs Shantamma - ILR 2009 KAR 2159;
21. Gunwant Kaur vs Municipal Committee Bhatinda – (1969) 3 SCC 769;
22. India in Govt. (NCT of Delhi) vs Manav Dharam Trust - (2017) 6 SCC 751;
23. K.N.Aswathnarayana Shetty vs State of Karnataka -(2014) 15 SCC 394;
24. Century Central vs State of Karnataka - 2014 SCC OnLine Kar 12007;
25. Kakaral Ravikumar vs State of Karnataka - (2013) 2 KCCR 1108; and
26. Bangalore Medical Trust vs B.S Muddappa - (1991) 4 SCC 54.
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and prosecute the present petition. In this context, it is contended by the petitioner that by virtue of the provisions of the Facilitation Act, 2002, under which, the project of the petitioner which included the subject land was approved, created a vested right in favour of the petitioner. It is also contended that apart from the subject land, another extent of land measuring 8 acres 4 guntas has been allotted to the petitioner who has invested more than Rs.13.5 crores for the project and has sufficient means to invest the total cost of the project, which was about Rs.40 crores. It is also contended that the petitioner is the ultimate beneficiary of the acquisition in respect of the subject lands and its rights are protected by the principles of legitimate expectation and promissory estoppel and consequently, it cannot be said that the petitioner did not have locus standi or that the petition was not maintainable.
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and other lands as an industrial area was issued on 10.12.2001, much prior to the petitioner submitting his project proposal to the respondent No.1-Karnataka Udyog Mitra in the year 2003. So also, there is no reference to the petitioner in the notifications issued under Section 3(1), Section 28(1) or Section 28(4) of the KIAD Act and the total extent of lands notified was about 97 acres, out of which, the subject lands measure only about 3 Acres 13 Guntas and as such, petitioner cannot claim to be the beneficiary of the subject acquisition.
right had accrued in favour of the petitioner prior to issuance of the impugned notification and consequently,
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since the petitioner had not acquired any manner of right, title, interest or possession over the subject lands, which were de-notified / withdrawn from acquisition by virtue of the impugned notification, the petitioner does not have locus standi to file, maintain or prosecute the present petition which is not maintainable and liable to be dismissed.
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the fact still remains that the petitioner is not even a postacquisition allottee; in fact, petitioner is merely/simply a proposed/prospective post-acquisition allottee who had/has not acquired any right in the subject matter of the acquisition proceedings. The right of a post-acquisition allottee to participate in proceedings relating to compensation cam up for consideration before the Apex Court in the case of Peerappa Hanmantha Harijan vs State of Karnataka – (2015)10 SCC 469, wherein it was held as under:
“ 30. On the basis of the rival legal contentions, the following points would arise for our consideration:
30.1. (i) Whether the allottee Company (M/s Ultra Tech Cement Ltd.) is either a beneficiary or interested person entitled for hearing before determination of the market value to award just and reasonable compensation in respect of the acquired land of the appellants either before the Deputy Commissioner or Reference Court?
30.2. (ii) Whether the writ petition filed by the allottee Company before the High Court is maintainable in law?
30.3. (iii) Whether the order of remand allowing the writ petition of the allottee Company to the Reference Court is legal and valid?
30.4. (iv) Whether the owners of the land are entitled for the enhanced compensation?
30.5. (v) If so, what award?
31. Points (i), (ii) and (iii) are answered together as they are interrelated by assigning the following reasons.
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32. It is an undisputed fact that the acquisition of land of the appellants was acquired along with the lands of the other owners at the instance of KIADB by the State Government in exercise of its power under Section 28 of the KIAD Act in favour of KIADB for the purpose of formation of industrial estate in the industrial area to establish industries at Sedam Taluk, Gulbarga District.
33. Section 28(1) of the KIAD Act, envisages that if, at any time, the State Government is of the opinion that any land is required for the purpose of development by KIADB or for any other purpose in furtherance of the objects of this Act, it may by notification, give notice of its intention to acquire such land. The Land Acquisition Officer after considering the cause, if any, shown by the owner of the land and by any other person interested therein and after giving such owner and person an opportunity of being heard, may pass such orders as it may deem fit for acquiring the land for establishment of industries. When the State Government is satisfied that any land should be acquired for the purpose specified in the notification issued under Section 28(1) of the KIAD Act, and after such orders passed by the State Government as per Section 28(3) of the KIAD Act are passed, the State Government shall issue the declaration notification in the Official Gazette to that effect as per Section 28(4) of the KIAD Act declaring the land mentioned in the notification under Section 28(1) of the Act to be acquired in favour of KIADB for the purpose of industrial development by it.
34. As can be seen from the facts of the case on hand, in the notification under Section 28(1) of the KIAD Act, the purpose specified by the State Government for acquisition of the land of the appellants and other landowners is for establishment of industries by KIADB. Further, it should also be remembered that in terms of the Act, the ownership of the land after acquisition by publication of the notification under Section 28(4) of the KIAD Act shall absolutely vest in the State
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Government under Section 28(5) of the Act and the same will be free from all encumbrances.
35. The State Government thereafter may by issuing notice in writing, order any person who may be in possession of the land to surrender or deliver possession of the land thereof in its favour or any person duly authorised by it within 30 days of the service of the notice. As per Section 28(7) of the KIAD Act, if any person refuses or fails to comply with the order made under sub-section (5), then the State Government or any officer authorised by it in this behalf may take possession of the land from either owner or interested person. Section 28(8) of the KIAD Act, in express terms states that where the land has been acquired by the State Government for KIADB, the State Government, after it has taken possession of the land from either owner or interested person may transfer the land to KIADB for the purpose for which the land has been acquired by it.
36. Further, the provision under Section 29 of the KIAD Act speaks of the compensation payable in relation to the acquired land to either owners or interested persons of such land and that the State Government shall pay such compensation in respect of the acquired land in accordance with the provisions of the KIAD Act. Section 30 of the KIAD Act states that the provisions of the LA Act shall mutatis mutandis apply in respect of holding enquiry and to pass an award of compensation by the Deputy Commissioner by determining the market value of the land. The case may be referred to the Reference Court for the apportionment of the compensation payable to such person or persons if there is any dispute regarding claims and the payment of compensation in respect of the acquired land under Chapter VII of the KIAD Act. In view of the above statutory provisions of the KIAD Act, the provisions of Sections 11, 18 and 30 of the LA Act are applicable for the purpose of determination of just and reasonable compensation of the acquired land
33
payable to the landowners either by the Deputy Commissioner or Reference Court.
37. Further, it is necessary for us to examine Section 32(2) of the KIAD Act, which provides that any land transferred in favour of KIADB by the State Government, developed by or under the control and supervision of KIADB shall be dealt with by it in accordance with the Regulations framed by it after approval by the State Government and as per directions given by the State Government in that behalf. Section 40 of the KIAD Act confers power upon the State Government to frame Rules after previous publication by way of notification. 38. Further, Section 41 of the KIAD Act confers power upon KIADB by notification to make regulations consistent with the Act and the Rules made thereunder to carry out the purposes of the Act with the previous approval of the State Government. Section 41(2)(b) of the KIAD Act is most relevant for the purpose of this case, which states that KIADB can frame regulations laying down the terms and conditions under which it may dispose of the land acquired in its favour by the State Government under the provisions of Sections 28(1) and (4) of the KIAD Act.
39. Further, it is also important in this case to refer to the relevant provisions under the KIADB Regulations. Regulation 4 under Chapter II of the KIADB Regulations prescribes the form of application to be filed and submitted by the applicant for the allotment of land or shed in an industrial area. It also provides that the application shall be made to the Executive Member of KIADB in the prescribed form (Form 1) obtained from it in duplicate along with an earnest money. This proviso was inserted by Notification dated 13-9-2002, w.e.f. 3-102002.
40. Regulation 5 of the KIADB Regulations pertains to the manner of disposal of land/shed in each industrial area or part thereof, whether by lease, lease-cum-sale, sale, auction-sale, auction-lease, assignment or otherwise. It also provides that
34
in each case, KIADB will also have the discretion to decide the detailed conditions in such agreement which shall be binding on the applicant.
41. Regulation 7 of the KIADB Regulations provides for KIADB to notify the availability of land, the manner of disposal, the last date for submission of applications and such other particulars as KIADB may consider necessary in each case, by giving wide publicity through newspapers having circulation in and outside the State of Karnataka, and invite applications from industrialists or persons intending to start industries in the industrial area.
42. Regulation 9 of the KIADB Regulations provides for KIADB to register all the applications which are complete in order in the register maintained in Form 2 and grant receipts for all sums received as application fee, initial deposit or other deposits.
43. Regulation 10 of the KIADB Regulations provides that KIADB after being satisfied that the person, firm or company who makes an application is likely to start production within a reasonable period, and is not one which is declared obnoxious under Regulation 14, may make an allotment in his/their favour thereafter.
43.1. Clause (b) of Regulation 10 of the KIADB Regulations empowers KIADB to constitute sub-committees for considering the applications for allotment of plots and also delegate its power to the Executive Member of the Board; if necessary, for the purpose of allotment of industrial plant/shed.
43.2. Clause (c) of Regulation 10 of the KIADB Regulations empowers Executive Member to notify such applicant to whom an allotment is made and to execute the agreement in Form 3 or 4 or 5 as the case may be with such modification as may be required in each case on such date, time and place.
43.3. Clause (d) of Regulation 10 of the KIADB Regulations provides that failure to execute the agreement or to pay the
35
sums demanded by the Executive Member as per notice given under Regulation 10(c) will render the allottee to have deemed to have declined the allotment.
43.4. Clause (e) of Regulation 10 grants the discretion to KIADB or the Executive Member with the authority of KIADB to grant extension of time for complying with the terms of the notice issued under Regulation 10(c) with or without payment of interest at 9% on the sums payable to KIADB in terms of the said notice for the extended period.
44. The aforesaid provisions of the KIAD Act and the KIADB Regulations make it abundantly clear that the acquisition of the agricultural land in the notified industrial area vide notifications issued under Sections 28(1) and (4) of the KIAD Act, empowers the State Government to acquire the land for the purpose of industrial development by KIADB after the acquired land's possession is transferred in its favour by the State Government.
45. Sections 29 and 30 of the KIAD Act read with Sections 11, 18 and 30 of the LA Act would clearly mandate that both the State Government and KIADB are liable, jointly or severally, to pay the compensation to the owners or interested persons of the acquired land. The market value of the acquired land is required to be determined by the Reference Court by applying the provisions of Section 18 of the LA Act, after passing an award as provided under Section 11 and notifying the same to the landowners or interested persons under Section 12(2) of the LA Act if the owners are not satisfied with either the compensation awarded by the Deputy Commissioner or with regard to the area of acquisition of land.
46. A careful reading of the Regulations referred to supra make it abundantly clear that the land acquired shall be disposed of by KIADB by inviting applications from the eligible applicants, notifying the availability of land, prescribing the manner of such disposal and fixing the last date for submitting
36
applications and giving such particulars as it may consider absolutely necessary by publishing it in the newspapers having wide circulation in and outside the State of Karnataka. 47. In the appeals arising out of SLPs (C) Nos. 31624-25 of 2014, it has been specifically mentioned in Annexure P-1, that the lands specified in the schedule mentioned in the notification are required for the development by KIADB for the establishment of the industries therein. In exercise of powers conferred by sub-section (1) of Section 28 of the KIAD Act, the State Government had given notice to the landowners of its intention to acquire the said land in favour of industrial development by KIADB.
48. Clause 1 of Annexure P-5, which is a copy of the agreement made between KIADB and M/s Rajashree Cements reads thus: “An agreement made at Gulbarga on the second day of April 2005 between the Karnataka Industrial Area Development Board having its office at Kapnoor, 1st Stage Industrial Area, Humnabad Road, Gulbarga represented by Sr. G.H. Sreedhara, Deputy Development Officer hereinafter called the ‘the lessor’ (which term shall wherever the context so permits, and includes its successors-in-interest) of the one part M/s Rajashree Cement, Aditya Nagar, Malkhed, represented by Shri Sunil Kothari Vice-President (F&C) hereinafter called the ‘the lessee’ (which term shall wherever the context so permits, means and includes his/her/its heirs, executor, administrators, assignee and legal representatives) of the other part….
NOW IT IS HEREBY AGREED BETWEEN THE PARTIES HERETO as
follows:
1. In consideration of the sum of Rs 65,704.00 paid by the lessee to the lessor as premium and of the rent hereby reserved and of the covenants and agreements on the part of the lessee hereinafter contained the lessor hereby demise unto the lessee all that piece of land known as Survey Nos. 306, Survey Nos. 306/9/1, 306/10/J of Malkhed (J) Village,
37
Sedam Taluk and Survey Nos. 323/1, 324/1, 325/1 of Diggaon Village, Chittapur Taluk, District Gulbarga containing by admeasurements 27 acres 21 guntas or thereabouts and more fully described in the first schedule hereunder written and delineated on the plan annexed hereto and thereon surrounded by a red colour boundary line together with the buildings and erections now or at any time hereafter standing and being thereon and together with all rights, easements and appurtenances thereto belonging except and reserving unto the lessor all mines and minerals in and under the said land, or any part thereof to hold the land and premises hereinbefore expressed to be there by demised (hereinafter referred to as ‘the demised premises’) unto the lessee for the term of 21 years computed on the 31st day of March, 2005 unless the lease is determined earlier under Clause 4 hereof PAYING therefore yearly, during the said term unto the lessor at the office of the Executive Member or as otherwise required the yearly rent of Rs 100 the said rent to be paid over a period of 21 years without any deductions whatsoever on the 31st day of March month in each and every year: Provided always that in case any payment is not made on the date on which day it becomes due amount it shall be charged interest at 18% p.a. or such rates as may be fixed by the lessor from time to time from the due date to the date of payment.”
(emphasis supplied) 49. The said lease deed is executed between the parties viz. KIADB and the Company with such terms and conditions as mentioned under Clauses 5(a) and (b), which are extracted hereunder:
“5. (a) The premium indicated in Clause 1 of this agreement represents the tentative cost of land. In the event of lessor incurring the payment of amounts to the landowners over and above the awards made by the acquiring authority by virtue of awards passed by the competent court of law or in view of the provisions of the Land Acquisition (Amendment) Act, 1984 in respect of demised premises or any part thereof the same
38
shall be met by the lessee within one month from the date of receipt of communication signed by the executive or any other officer authorised by the lessor. Further, in the event of lessor incurring the payment amounts to the landowners for the Malkies and structures existing on the demised premises, the same shall be met by the lessor within one month from the date of receipt of communication signed by the Executive Member or any other officer authorised by the lessor.
(b) As soon as it may be convenient the lessor will fix the price of the demised premises at which it will be sold to the lessee and communicate it to the lessee and decision of the lessor in this regard will be final and binding, on the lessee. The lessee shall pay the balance of the value of the property, if any, after adjusting the premium and the total amount of rent paid by the lessee and earnest money deposit within one month from the date of receipt of communication signed by the lessor or any other officer authorised in this behalf by the lessor. On the other hand, if any sum is determined as payable by the lessor to the lessee after the adjustment as aforesaid, such sum shall be refunded to the lessee before the date of execution of the sale deed.”
(emphasis supplied)
50. On a careful examination of the aforesaid clauses of the lease agreement executed between the parties in respect of the land of the appellants, it becomes manifestly clear that the said agreement is executed by KIADB in favour of the Company after allotment of land was made in favour of the Company as provided under Regulations 10(a) and (c) of the KIADB Regulations respectively by following the procedure of inviting applications and submission of the applications by the interested parties along with the required deposits towards the cost of the land. Further, Clauses 5(a) and (b) of the lease agreement referred to supra, would clearly state that the premium indicated in Clause 1 of the lease agreement represents the tentative cost of the land and in the event of the lessor incurring payment of amounts to the landowners over and above the awards made by the acquiring authority by virtue of the award passed by the competent court of law or in view of the provisions of the LA Act in respect of demised premises or any part thereof, the same shall be met
39
by the lessee within one month from the date of receipt of the communication signed by the Executive Member or any other officer authorised by the lessor. Clause 5(b) also makes similar provision to that effect between the lessor and the lessee.
51. From a careful reading of the aforesaid clauses of the lease agreement along with the provisions of Section 32(2) of the KIAD Act and Regulations 4, 7, 10(b), (c) and (d) of the KIADB Regulations, it is clear that the Company is only the lessee by way of allotment of the land as the same has been allotted by KIADB in its favour and has executed the lease deed in its favour in respect of the allotted land.
52. In view of the aforesaid documents, namely, the notifications issued under Sections 28(1) and 28(4) of the KIAD Act by the State Government, it can be safely concluded by us that the acquisition of the land involved in these proceedings is for the purpose of industrial development by KIADB in Sedam Taluk. Therefore, the beneficiary of the acquired land is only KIADB but not the Company as claimed by it. A reading of Section 28(5) of the KIAD Act makes it clear that the land which is acquired by the State Government statutorily vests absolutely with it. After following the procedure provided under Sections 28(6) and (7) of the KIAD Act, the State Government takes possession of the acquired land from the owners/person/persons who are in possession of the land and transfers the same in favour of KIADB for its development and disposal of the same in accordance with Regulation 10(a) of the KIADB Regulations, referred to supra.
53. In the instant case, a perusal of the provisions of the lease agreement executed between the parties referred to supra and Regulation 10 clauses (a), (c), (d) and (e) of the KIADB Regulations make it abundantly clear that the Company is only the allottee/lessee of the acquired land and as per Clauses 5(a) and (b) of the lease agreement referred
40
to supra, the premium indicated in the lease agreement in respect of the allotted land in its favour represents the tentative cost of the land. It has been further specified in the lease agreement that in the event of the lessor incurring the payment of amounts to the landowners over and above the awards made by the acquiring authority by virtue of awards passed by the competent court of law in view of the provisions of the Land Acquisition (Amendment) Act, 1984 in respect of demised premises or any part thereof, the same shall be met by the lessee within one month from the date of receipt of communication signed by the Executive Member or any other officer authorised by the lessor. In view of the above conditions of the lease agreement, neither KIADB nor the Company can contend that the acquisition of the land involved in these proceedings is in favour of the lessee Company. Therefore, the Company is neither a beneficiary nor an interested person as claimed by them in terms of Section 2(11) of the KIAD Act or under Section 3(b) of the LA Act as per which, “person interested” includes all persons claiming an interest in compensation to be made on account of the acquisition of land under the KIAD Act and that a person shall be deemed to be interested in the land if he is interested in an easement affecting the land. It is necessary to examine Section 3(b) read with Section 9 of the LA Act, which deals with notice to persons interested and Section 11, which deals with enquiry and award to be passed by the Deputy Commissioner/Land Acquisition Officer.
54. A careful reading of the aforesaid provisions of the LA Act, the KIAD Act and the KIADB Regulations would clearly go to show that the Company is neither a beneficiary, nor an interested person in the land as on the date of acquisition of the land, as the land was acquired by the State Government in favour of KIADB who is the beneficiary and it has allotted in favour of the Company after the acquired land was
41
transferred in its favour by the State Government and executed the lease agreement referred to supra.
55. The strong submissions made by the learned Senior Counsel on behalf of the respondents Dr A.M. Singhvi and Mr Basava Prabhu Patil, in interpreting the aforesaid provisions of Sections 3(b), 9, 11 and 20(b) read with Section 54 of the LA Act are totally misplaced and misconceived for the reason that the Company cannot be considered as “person interested” to claim interest in the compensation to be made to the owners on account of the acquisition of the land of the appellant owners and other landowners.
56. Further, strong reliance has been placed by the learned Senior Counsel on behalf of the Company upon Section 3(f)(viii) of the LA Act, as amended by the Karnataka Legislature by Act 17 of 1961 to show that the Company is an “interested person” in the proceedings of determination of the market value of the acquired land and passing of an award. Section 3(f)(viii) includes the provision of land for acquisition in favour of a company— (a) where the land is needed for the construction of some work, and such work is likely to prove substantially useful to the public; or (b) where the land is needed by a building cooperative society or corporation for the construction of houses. The said contention of the learned Senior Counsel is wholly misconceived as the said provision has no application to the fact situation.
57. For the acquisition of land under the provisions of the LA Act in favour of a company the mandatory procedure as provided under Part VII of the LA Act and Rules must be adhered to, that is not the case in the acquisition of land involved in these proceedings as the acquisition of land is under the provisions of the KIAD Act and therefore the reliance placed upon the provision of Section 3(f)(viii) of Karnataka LA Amended Act 17 of 1961 is not applicable to the facts of the case on hand and therefore, the said provision cannot be made applicable to the case on hand.
42
58. The definition of “public purpose” under the LA Act cannot be imported to the acquisition of land by the State Government for the industrial development under the provision of the KIAD Act as the words “development”, “industrial area” and “industrial estate” have been clearly defined under sub-sections (5), (6) and (7) of Section 2 of the KIAD Act which reads thus:
“ 2. (5) ‘ Development ’ with its grammatical variations means the carrying out of levelling, digging, building, engineering, quarrying or other operations in, on, over or under land, or the making of any material change in any building or land, and includes redevelopment; and ‘to develop’ shall be construed accordingly;
(6) ‘ Industrial area ’ means any area declared to be an industrial area by the State Government by notification which is to be developed and where industries are to be accommodated; and industrial infrastructural facilities and amenities are to be provided and includes, an industrial estate;
(7) ‘ Industrial estate ’ means any site selected by the State Government where factories and other buildings are built for use by any industries or class of industries.”
59. Reliance has also been placed by the learned Senior Counsel upon Sections 3(b), 9 and 20(b) of the LA Act, which provisions deal with service of notice to all persons interested in the possession of the acquired land except such (if any) of them as have consented without protest to receive payment of compensation awarded for the purpose of holding an enquiry by the Special Deputy Commissioner for determination of compensation of the acquired land. None of the above provisions of the LA Act supports the case of either KIADB or the Company. Therefore, the contention urged on their behalf that the Company is an interested person in the acquired land for determination of compensation to be paid to the landowners for their acquired land is wholly untenable and therefore, the same cannot be accepted by this Court.
60. The reliance placed upon the provisions of Sections 50(1) and (2) of the LA Act, also are not applicable to the case on
43
hand for the reason that Section 50 of the LA Act applies to the acquisition of land in favour of a company by the State Government by following the mandatory procedure contemplated under Part VII of the LA Act and relevant rules framed for that purpose. Therefore, the claim made by the Company that it has got every right to participate in the proceedings for determination and redetermination of the market value of the acquired land and award of compensation passed by the Land Acquisition Officer or Deputy Commissioner or before the Reference Court or the appellate court is wholly untenable in law and therefore, the submissions made on behalf of the Company cannot be accepted and the same is rejected.
61. Further, both the learned Senior Counsel on behalf of KIADB and the Company have placed reliance on various decisions rendered by this Court in support of their above respective legal submissions that the Company is an interested person and, therefore, it has got right to participate in the proceedings before the Reference Court for determination of compensation before passing the award either by the Land Acquisition Officer or the Deputy Commissioner or the Reference Court at the instance of the owner or any other interested person. These include judgments rendered by this Court in U.P. Awas Evam Vikas Parishad v. Gyan Devi [(1995) 2 SCC 326] , Himalayan Tiles and Marble (P) Ltd. v. Francis Victor Coutinho [(1980) 3 SCC 223] and P. Narayanappa v. State of Karnataka [(2006) 7 SCC 578] and other decisions which are not required to be mentioned in this judgment as they are all reiteration of the law laid down in the above cases.
62. The reliance placed on the various decisions of this Court by both the learned Senior Counsel on behalf of KIADB and the Company, is misplaced as none of the said judgments relied upon are applicable to the fact situation in the present case for the reason that those cases dealt with reference to
44
the acquisition of land under the provisions of the LA Act, either in favour of the company or development authorities, whereas in the case on hand, the acquisition proceedings have been initiated under the KIAD Act for industrial development by KIADB. Further, the original acquisition record in respect of the acquired land involved in the proceedings by the learned Standing Counsel on behalf of the State of Karnataka as per our directions issued vide our orders dated 17-11-2014 [Peerappa Hanmantha Harijan v. State of Karnataka, 2014 SCC OnLine SC 1678, wherein it was directed:“Issue notice to the State Government. The learned counsel for the petitioners to take out notice to the learned Standing Counsel appearing for the State Government. Dasti, in addition, is also permitted. Mr V.N. Raghupathy, learned counsel accepts notice for the State of Karnataka and Mr Nishanth Patil, learned counsel accepts notice for Karnataka Industrial Area Development Board (for short ‘KIADB’). The learned counsel appearing for the State Government and the learned counsel appearing for KIADB are directed to produce the relevant records in respect of the proceedings relating to land acquisition involved in these matters. There shall be stay of the effect and operation of the impugned order during the pendency of these petitions. List the matters after four weeks. In the meanwhile, all the respondents are at liberty to file written statements, if any.”] and 24-3-2015 [Peerappa Hanmantha Harijan v. State of Karnataka, 2015 SCC OnLine SC 1707, wherein it was directed:“Heard Ms Kiran Suri, learned Senior Counsel for the petitioners in SLPs (C) Nos. 31624-25 of 2014 in part. List all the matters as part for further hearing. Vide order dated 17-11-2014, learned counsel for the State as well as the learned counsel for KIADB were directed to produce the relevant records in respect of the proceedings relating to land acquisition involved in these matters, record as well as the records relating to allotment of land. However, as per office records, nothing has been
45
produced so far. In this view of the matter, the learned counsel for the State as well as the learned counsel for KIADB are directed to comply with the order dated 17-11-2014 and produce the relevant records in respect of the proceedings relating to land acquisition and the allotment of land involved in these matters before the next date of hearing. List the matters on 15-4-2015.”] , do not disclose the fact that the acquisition of lands covered in the acquisition notifications are in favour of the Company. Thus, the acquisition of land in favour of KIADB is abundantly clear from the preliminary and final notifications issued by the State Government and thereafter following the procedure under sub-sections (6) and (7) of Section 28 of the KIAD Act, it took possession of the acquired land from the owners who were in possession of the same and was transferred in favour of KIADB for its disposal for the purpose for which lands were acquired as provided under Section 32(2) of the KIAD Act read with the Regulations referred to supra framed by KIADB under Section 41(2)(b) of the KIAD Act. Therefore, the reliance placed upon the judgments of this Court by the learned Senior Counsel on behalf of the Company and KIADB, are wholly inapplicable to the fact situation and do not support the case of the Company.
63. In view of the foregoing reasons recorded by us on the basis of the acquisition notifications issued by the State Government under the statutory provisions of the KIAD Act and therefore, we have to answer Points (i), (ii) and (iii) in favour of the landowners holding that the Company is neither the beneficiary nor interested person of the acquired land, hence, it has no right to participate in the award proceedings for determination of the market value and award the compensation amount of the acquired land of the appellants. Hence, the writ petition filed by the Company questioning the correctness of the award passed by the Reference Court which is affirmed by the High Court is not at all maintainable
46
in law. On this ground itself, the writ petition filed by the Company should have been rejected by the High Court, instead it has allowed and remanded the case to the Reference Court for reconsideration of the claims after affording opportunity to the Company, which order suffers from error in law and therefore, the same is liable to be set aside.
64. Further, the learned Judge of the High Court has erroneously held that the allottee Company is a beneficiary of the acquired land of the appellants, which finding of the learned Judge is not correct both on facts and in law. The findings and reasons recorded by the High Court in the impugned judgment in allowing the writ petition and quashing the award of the Reference Court and remanding it back to the Reference Court and allowing the Company to participate in the proceedings for redetermination of compensation for the acquired land is wholly impermissible in law and the same are in contravention of the provisions of the KIAD Act, the LA Act, the KIADB Regulations and the lease agreement, which has been executed by KIADB in favour of the Company and therefore, the impugned judgment and order [State of Karnataka v. Peerappa Hanmantha Harijan, Review Petition No. 2537 of 2013 in MFA No. 32157 of 2012, order dated 229-2014 (KAR)] is liable to be set aside by allowing the appeals of the owners.
65. Further, the learned Single Judge of the High Court has further committed an error in law in not appreciating Section 54 of the LA Act, which provision provides the right to appeal to the landowners, or State Government and beneficiaries of the acquired land but not to the company which is the lessee. When the company does not have the right to file an appeal against the award it also has no right to file a writ petition. KIADB has filed the belated appeal after disposal of the appeal filed by the appellants by the High Court and against which award it has filed the present appeal questioning the
47
correctness of the same and prayed for enhancement of compensation and the said appeal is being disposed of by this common judgment after adverting to the rival legal contentions urged on behalf of the parties. The High Court has rightly dismissed the belated appeal filed by KIADB.
66. Therefore, the appeal filed by KIADB questioning the order of remand passed in the writ petition and review petition is liable to be set aside. The appeal has been filed by KIADB as it is aggrieved of the findings and certain observation recorded against them by the High Court and it has got reasonable apprehension that the Reference Court may not appreciate the facts and evidence that may be produced before it. For the reasons stated above, the appeal filed by KIADB has no merit and they have become unnecessary hence, the same are liable to be dismissed. Accordingly, we dismiss the same.
Satish Kumar Gupta vs. State of Haryana – (2017) 4
SCC 760, wherein it was held as under:
2. The question for consideration is whether a postacquisition allottee of land is necessary or proper party or has any locus to be heard in the matter of
48
determination of compensation under the scheme of the Land Acquisition Act, 1894 (the Act). If not, whether the impugned order permitting additional evidence and directing remand is sustainable.
9. To determine the question whether the postacquisition allottee of land is necessary or proper party or has any locus to be heard in the matter of determination of compensation, we may refer to the scheme of the Act. The acquisition may either be for a “public purpose” as defined under Section 3(f) or for a company under Part VII of the Act. If the acquisition is for a public purpose (as the present case), the land vests in the State after the Collector makes an award and the possession is taken. Till the award is made, no person other than the State comes into the picture. Once the land vests in the State, the acquisition is complete. Any transferee from the State is not concerned with the process of acquisition. The State may transfer the land by public auction or by allotment at any price with which the person whose land is acquired has no concern. The mere fact that the Government chooses to determine the allotment price with reference to compensation price determined by the Court does not provide any locus to an allottee to contest the claim for enhancement of compensation.
10. This legal position is well settled on principle as well as the precedent. In Hindu Kanya Maha Vidyalaya [Hindu Kanya Maha Vidyalaya v. Municipal Committee, Jind, 1988 Supp SCC 719] it was observed : (SCC p. 720, para 3)
49
“3. … Indisputably the land in dispute was not acquired for the purpose of the appellants instead the land was acquired for the Municipal Committee for the purpose of developing its Scheme No. 5. After the declaration of award Municipal Committee took possession of the land and thereafter transferred a portion of the same to the appellants under an agreement. In these circumstances the ratio laid down by this Court in Himalayan Tiles & Marble (P) Ltd. v. Francis Victor Coutinho [Himalayan Tiles and Marble (P) Ltd. v. Francis Victor Coutinho, (1980) 3 SCC 223] does not apply as the appellants are not interested persons and they have no right to question the award.”
11. Again, in Peerappa Hanmantha [Peerappa Hanmantha Harijan v. State of Karnataka, (2015) 10 SCC 469 : (2016) 1 SCC (Civ) 155] inter alia the following questions were framed for consideration:
“30.1. (i) Whether the allottee Company (M/s Ultra Tech Cement Ltd.) is either a beneficiary or interested person entitled for hearing before determination of the market value to award just and reasonable compensation in respect of the acquired land of the appellants either before the Deputy Commissioner or Reference Court?
30.2. (ii) Whether the writ petition filed by the allottee Company before the High Court is maintainable in law?
30.3. (iii) Whether the order of remand allowing the writ petition of the allottee Company to the Reference Court is legal and valid?”
12. The above questions were answered as follows : (Peerappa Hanmantha case [Peerappa Hanmantha Harijan v. State of Karnataka, (2015) 10 SCC 469 : (2016) 1 SCC (Civ) 155] , SCC p. 495, para 63)
“63. In view of the foregoing reasons recorded by us on the basis of the acquisition notifications issued by the State Government under the statutory provisions of the KIAD Act and therefore, we have to answer Points (i), (ii) and (iii) in favour of the landowners
50
holding that the Company is neither the beneficiary nor interested person of the acquired land, hence, it has no right to participate in the award proceedings for determination of the market value and award the compensation amount of the acquired land of the appellants. Hence, the writ petition filed by the Company questioning the correctness of the award passed by the Reference Court which is affirmed [Peerappa Hanmantha Harijan v. State of Karnataka, 2013 SCC OnLine Kar 10042] by the High Court is not at all maintainable in law. On this ground itself, the writ petition filed by the Company should have been rejected by the High Court, instead it has allowed and remanded the case to the Reference Court for reconsideration of the claims after affording opportunity to the Company, which order suffers from error in law and therefore, the same is liable to be set aside.”
13. The judgments in U.P. Awas Evam Vikas Parishad [U.P. Awas Evam Vikas Parishad v. Gyan Devi, (1995) 2 SCC 326] , Himalayan Tiles [Himalayan Tiles and Marble (P) Ltd. v. Francis Victor Coutinho, (1980) 3 SCC 223] and P. Narayanappa v. State of Karnataka [P. Narayanappa v. State of Karnataka, (2006) 7 SCC 578] as mentioned in para 61 of the judgment in Peerappa Hanmantha [Peerappa Hanmantha Harijan v. State of Karnataka, (2015) 10 SCC 469 : (2016) 1 SCC (Civ) 155] were held to be not applicable as the same applied only when the acquisition is for a company or for the beneficiary of the acquisition as mentioned in the notification for acquisition itself. This is clear from the following : (Peerappa Hanmantha case [Peerappa Hanmantha Harijan v. State of Karnataka, (2015) 10 SCC 469 : (2016) 1 SCC (Civ) 155] , SCC pp. 49395, paras 61-62)
“61. Further, both the learned Senior Counsel on behalf of KIADB and the Company have placed
51
reliance on various decisions rendered by this Court in support of their above respective legal submissions that the Company is an interested person and, therefore, it has got right to participate in the proceedings before the Reference Court for determination of compensation before passing the award either by the Land Acquisition Officer or the Deputy Commissioner or the Reference Court at the instance of the owner or any other interested person. These include judgments rendered by this Court in U.P. Awas Evam Vikas Parishad v. Gyan Devi [U.P. Awas Evam Vikas Parishad v. Gyan Devi, (1995) 2 SCC 326] , Himalayan Tiles and Marble (P) Ltd. v. Francis Victor Coutinho [Himalayan Tiles and Marble (P) Ltd. v. Francis Victor Coutinho, (1980) 3 SCC 223] and P. Narayanappa v. State of Karnataka [P. Narayanappa v. State of Karnataka, (2006) 7 SCC 578] and other decisions which are not required to be mentioned in this judgment as they are all reiteration of the law laid down in the above cases.
62. The reliance placed on the various decisions of this Court by both the learned Senior Counsel on behalf of KIADB and the Company, is misplaced as none of the said judgments relied upon are applicable to the fact situation in the present case for the reason that those cases dealt with reference to the acquisition of land under the provisions of the LA Act, either in favour of the company or development authorities, whereas in the case on hand, the acquisition proceedings have been initiated under the KIAD Act for industrial development by KIADB. Further, the original acquisition record in respect of the acquired land involved in the proceedings by the learned Standing Counsel on behalf of the State of Karnataka as per our directions issued vide our orders dated 17-11-2014 [Peerappa Hanmantha Harijan v. State of Karnataka, (2015) 10 SCC 469, p. 494 (footnote 17), wherein it was directed:“Issue notice to the State Government. The learned counsel for the petitioners to take out notice to the learned Standing Counsel appearing for the State Government. Dasti, in addition, is also permitted. Mr V.N. Raghupathy, learned counsel accepts notice for the State of Karnataka and Mr Nishanth Patil, learned counsel accepts notice for Karnataka Industrial Area Development Board (for short “KIADB”). The learned counsel appearing for the State Government and the learned counsel appearing for KIADB are directed to
52
produce the relevant records in respect of the proceedings relating to land acquisition involved in these matters. There shall be stay of the effect and operation of the impugned order during the pendency of these petitions. List the matters after four weeks. In the meanwhile, all the respondents are at liberty to file written statements, if any.”] and 24-3-2015 [Peerappa Hanmantha Harijan v. State of Karnataka, (2015) 10 SCC 469, p. 494 (footnote 18), wherein it was directed:“Heard Ms Kiran Suri, learned Senior Counsel for the petitioners in SLPs (C) Nos. 3162425 of 2014 in part. List all the matters as part for further hearing. Vide order dated 17-11-2014 (see footnote 16, hereinabove), learned counsel for the State as well as the learned counsel for KIADB were directed to produce the relevant records in respect of the proceedings relating to land acquisition involved in these matters, record as well as the records relating to allotment of land. However, as per office records, nothing has been produced so far. In this view of the matter, the learned counsel for the State as well as the learned counsel for KIADB are directed to comply with the order dated 17-11-2014 (see footnote 16, hereinabove) and produce the relevant records in respect of the proceedings relating to land acquisition and the allotment of land involved in these matters before the next date of hearing. List the matters on 15-4-2015.”] , do not disclose the fact that the acquisition of lands covered in the acquisition notifications are in favour of the Company. Thus, the acquisition of land in favour of KIADB is abundantly clear from the preliminary and final notifications issued by the State Government and thereafter following the procedure under sub-sections (6) and (7) of Section 28 of the KIAD Act, it took possession of the acquired land from the owners who were in possession of the same and was transferred in favour of KIADB for its disposal for the purpose for which lands were acquired as provided under Section 32(2) of the KIAD Act read with the Regulations referred to supra framed by KIADB under Section 41(2)(b) of the KIAD Act. Therefore, the reliance placed upon the judgments of this Court by the learned Senior Counsel on behalf of the Company and KIADB, are wholly inapplicable to the fact situation and do not support the case of the Company.”
53
14. We are in a respectful agreement with the above view in Hindu Kanya Maha Vidyalaya [Hindu Kanya Maha Vidyalaya v. Municipal Committee, Jind, 1988 Supp SCC 719] and Peerappa Hanmantha [Peerappa Hanmantha Harijan v. State of Karnataka, (2015) 10 SCC 469 : (2016) 1 SCC (Civ) 155] . No contrary view of this Court has been brought to our notice. The judgments relied upon by the respondents are distinguishable as already held by this Court.
15. In Himalayan Tiles [Himalayan Tiles and Marble (P) Ltd. v. Francis Victor Coutinho, (1980) 3 SCC 223] the acquisition was under Part VII of the Act. In Santosh Kumar [Santosh Kumar v. Central Warehousing Corpn., (1986) 2 SCC 343] the question was whether award of the Collector could be challenged, to which this Court answered in the negative except on the ground of fraud, corruption or collusion. In Neyvely Lignite [Neyvely Lignite Corpn. Ltd. v. Tahsildar (LA), (1995) 1 SCC 221] again the acquisition was under Part VII of the Act and in that context this Court held that the expression “person interested” could include a company or local authority for whose benefit the land was acquired. The postacquisition allottee cannot by any stretch of imagination be treated on a par with beneficiary for whom the land was acquired. In U.P. Awas Evam Vikas Parishad [U.P. Awas Evam Vikas Parishad v. Gyan Devi, (1995) 2 SCC 326] , the matter dealt with was in the context of statutory authority for whom the land was acquired. DDA v. Bhola Nath Sharma [DDA v. Bhola Nath Sharma, (2011) 2 SCC 54 : (2011) 1
54
SCC (Civ) 344] was a case in the context of beneficiary for whom the land was acquired.
“6. The short question, which is posed for the consideration of this Court is, whether, respondent No.1 – MRPL, who is simply an allottee of the land by the KIAD Board, after the acquisition of the lands under Section 28 of the KIAD Act, 1966, which was for the benefit of Karnataka Industrial Areas Development Board (KIADB) can be said to be a “person interested” under the provisions of KIAD Act, 1966 and therefore, was a proper party in the reference proceedings initiated at the instance of the original landowners?
7. While answering the aforesaid issue/question, it is required to be noted that in the present case, the land has been acquired under the provisions of the KIAD Act, 1966 and the notification has been issued under Section 28(1) of the KIAD Act, 1966. The land has been acquired by the State Government for KIADB
55
under three different notifications. After the lands were acquired, respondent No.1 – MRPL has been allotted the lands acquired as per the agreements between the KIADB and the MRPL. The present is not an acquisition under the provisions of the Land Acquisition Act and therefore, as such, neither Section 50 of the Land Acquisition Act, 1894 nor any other provisions of the Land Acquisition Act, 1894 shall be applicable with respect to the lands acquired under the provisions of the KIAD Act, 1966. Taking into consideration, the aforesaid factual aspects, the impugned judgment and order passed by the High Court in which it has heavily relied upon the decisions of this Court in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd. (supra) are required to be considered.
7.1 At the outset, it is required to be noted that as such, the issue involved in the present appeal in respect of the acquisitions under the KIAD Act, 1966 and the right of the subsequent allottee to participate in the reference proceedings and whether the subsequent allottee can be said to be a “person interested” under the provisions of the KIAD Act, 1966 is no longer res integra. While deciding the acquisition under the very KIAD Act, 1966 and the right of the subsequent allottee, who has been allotted the land by the KIADB in the case of Peerappa Hanmantha Harijan (supra) after distinguishing the decision of this Court in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd.
56
(supra), it is specifically observed and held by this Court that an allottee company cannot be said to be a beneficiary or a “person interested” entitled for hearing before determination of compensation. By observing and holding so, this Court had an occasion to consider the entire scheme of acquisition under the KIAD Act, 1966 and has distinguished the acquisition under the Land Acquisition Act, 1894. Before this Court also, the High Court remanded the matter at the instance of the allottee company in the writ petition filed by the allottee company to the Reference Court. This Court set aside the same while holding that the allottee company, who has been allotted the land under the provisions of the KIAD Act, 1966, can neither be said to be a beneficiary nor a “party interested” entitled for hearing before determination of compensation. This Court in the case of Peerappa Hanmantha Harijan (supra) considered in detail the allotment/lease agreement in favour of the allottee/lessee and also the relevant provisions of the KIAD Act, 1966 and has observed in paragraphs 50 to 54 as under:-
“50. On a careful examination of the aforesaid clauses of the lease agreement executed between the parties in respect of the land of the appellants, it becomes manifestly clear that the said agreement is executed by KIADB in favour of the Company after allotment of land was made in favour of the Company as provided under Regulations 10(a) and (c) of the KIADB Regulations respectively by following the procedure of inviting applications and submission of the applications by the interested parties along with the required deposits towards the cost of the land. Further, Clauses 5(a) and (b) of the lease agreement referred to supra, would clearly state that
57
the premium indicated in Clause 1 of the lease agreement represents the tentative cost of the land and in the event of the lessor incurring payment of amounts to the landowners over and above the awards made by the acquiring authority by virtue of the award passed by the competent court of law or in view of the provisions of the LA Act in respect of demised premises or any part thereof, the same shall be met by the lesseewithin one month from the date of receipt of the communication signed by the Executive Member or any other officer authorised by the lessor. Clause 5(b) also makes similar provision to that effect between the lessor and the lessee.
51. From a careful reading of the aforesaid clauses of the lease agreement along with the provisions of Section 32(2) of the KIAD Act and Regulations 4, 7, 10(b), (c) and (d) of the KIADB Regulations, it is clear that the Company is only the lessee by way of allotment of the land as the same has been allotted by KIADB in its favour and has executed the lease deed in its favour in respect of the allotted land.
52. In view of the aforesaid documents, namely, the notifications issued under Sections 28(1) and 28(4) of the KIAD Act by the State Government, it can be safely concluded by us that the acquisition of the land involved in these proceedings is for the purpose of industrial development by KIADB in Sedam Taluk. Therefore, the beneficiary of the acquired land isonly KIADB but not the Company as claimed by it. Areading of Section 28(5) of the KIAD Act makes it clearthat the land which is acquired by the StateGovernment statutorily vests absolutely with it. After following the procedure provided under Sections 28(6)and (7) of the KIAD Act, the State Government takes possession of the acquired land from the owners/person/persons who are in possession of the land and transfers the same in favour of KIADB for its development and disposal of the same in accordance with Regulation 10(a) of the KIADB Regulations, referred to supra.
53. In the instant case, a perusal of the provisions of the lease agreement executed between the parties referred to supra and Regulation 10 clauses (a), (c), (d) and (e) of the KIADB Regulations make it abundantly clear that the Company is only the allottee/lessee of the acquired land and as per Clauses 5(a) and (b) of the lease agreement referred to supra, the premium indicated in the lease agreement in respect of the allotted land in its favour represents the tentative cost of the land. It has been further specified in the lease agreement that in the event of
58
the lessor incurring the payment of amounts to the landowners over and above the awards made by the acquiring authority by virtue of awards passed by the competent court of law in view of the provisions of the Land Acquisition (Amendment) Act, 1984 in respect of demised premises or any part thereof, the same shall be met by the lessee within one month from the date of receipt of communication signed by the Executive Member or any other officer authorised by the lessor. In view of the above conditions of the lease agreement, neither KIADB nor the Company can contend that the acquisition of the land involved in these proceedings is in favour of the lessee Company. Therefore, the Company is neither a beneficiary nor an interested person as claimed by them in terms of Section 2(11) of the KIAD Act or under Section 3(b) of the LA Act as per which, “person interested” includes all persons claiming an interest in compensation to be made on account of the acquisition of land under the KIAD Act and that a person shall be deemed to be interested in the land if he is interested in an easement affecting the land. It is necessary to examine Section 3(b) read with Section 9 of the LA Act, which deals with notice to persons interested and Section 11, which deals with enquiry and award to be passed by the Deputy Commissioner/Land Acquisition Officer.
54. A careful reading of the aforesaid provisions of the LA Act, the KIAD Act and the KIADB Regulations would clearly go to show that the Company is neither a beneficiary, nor an interested person in the land as on the date of acquisition of the land, as the land was acquired by the State Government in favour of KIADB who is the beneficiary and it has allotted in favour of the Company after the acquired land was transferred in its favour by the State Government and executed the lease agreement referred to supra.”
7.2 Thereafter, this Court distinguished the nature of acquisition under the Land Acquisition Act from the acquisition under the KIAD Act, 1966 by observing as under in paragraphs 57, 58 and 60 to 65:-
“57. For the acquisition of land under the provisions of the LA Act in favour of a company the mandatory procedure as provided under Part VII of the LA Act and Rules must be adhered to, that is not the case in the acquisition of land
59
involved in these proceedings as the acquisition of land is under the provisions of the KIAD Act and therefore the reliance placed upon the provision of Section 3(f)(viii) of Karnataka LA Amended Act 17 of 1961 is not applicable to the facts of the case on hand and therefore, the said provision cannot be made applicable to the case on hand.
58. The definition of “public purpose” under the LA Act cannot be imported to the acquisition of land by the State Government for the industrial development under the provision of the KIAD Act as the words “development”, “industrial area” and “industrial estate” have been clearly defined under sub-sections (5), (6) and (7) of Section 2 of the KIAD Act which reads thus:
“2. (5) ‘Development’ with its grammatical variations means the carrying out of levelling, digging, building, engineering, quarrying or other operations in, on, over or under land, or the making of any material change in any building or land, and includes redevelopment; and ‘to develop’ shall be construed accordingly;
(6) ‘Industrial area’ means any area declared to be an industrial area by the State Government by notification which is to be developed and where industries are to be accommodated; and industrial infrastructural facilities and amenities are to be provided and includes, an industrial estate;
(7) ‘Industrial estate’ means any site selected by the State Government where factories and other buildings are built for use by any industries or class of industries.”
X X X X
60. The reliance placed upon the provisions of Sections 50(1) and (2) of the LA Act, also are not applicable to the case on hand for the reason that Section 50 of the LA Act applies to the acquisition of land in favour of a company by the State Government by following the mandatory procedure
contemplated under Part VII of the LA Act and relevant rules framed for that purpose. Therefore, the claim made by the Company that it has got every right to participate in the proceedings for determination and redetermination of the market value of the acquired land and award of compensation passed by the Land Acquisition Officer or Deputy Commissioner or before the Reference Court or the appellate court is wholly untenable in law and therefore, the submissions made on behalf of the
60
be
Company cannot accepted and the same is rejected.
cannot
61. Further, both the learned Senior Counsel on behalf of KIADB and the Company have placed reliance on various decisions rendered by this Court in support of their above respective legal submissions that the Company is an interested person and, therefore, it has got right to participate in the proceedings before the Reference Court for
determination of compensation before passing the award either by the Land Acquisition Officer or the Deputy Commissioner or the Reference Court at the instance of the owner or any other interested person. These include judgments rendered by this Court in U.P. Awas Evam Vikas Parishad v. Gyan Devi [(1995) 2 SCC 326] , Himalayan Tiles and Marble (P) Ltd. v. Francis Victor Coutinho [(1980) 3 SCC 223] and P. Narayanappa v. State of Karnataka [(2006) 7 SCC 578] and other decisions which are not required to be mentioned in this judgment as they are all reiteration of the law laid down in the above cases.
62. The reliance placed on the various decisions of this Court by both the learned Senior Counsel on behalf of KIADB and the Company, is misplaced as none of the said judgments relied upon are applicable to the fact situation in the present case for the reason that those cases dealt with reference to the acquisition of land under the provisions of the LA Act, either in favour of the company or development authorities, whereas in the case on hand, the acquisition proceedings have been initiated under the KIAD Act for industrial development by KIADB. Further, the original acquisition record in respect of the acquired land involved in the proceedings by the learned Standing Counsel on behalf of the State of Karnataka as per our directions issued vide our orders dated 17-11-2014 [Peerappa Hanmantha Harijan v. State of Karnataka, 2014 SCC OnLine SC 1678, wherein it was directed: “Issue notice to the State Government. The learned counsel for the petitioners to take out notice to the learned Standing Counsel apparing for the State Government. Dasti, in addition, is also permitted. Mr V.N. Raghupathy, learned counsel accepts notice for the State of Karnataka and Mr Nishanth Patil, learned counsel accepts notice for Karnataka Industrial Area Development Board (for short ‘KIADB’). The learned counsel appearing for the State Government and the learned counsel appearing for KIADB are directed to produce the relevant records in respect of
61
the proceedings relating to land acquisition involved in these matters. There shall be stay of the effect and operation of the impugned order during the pendency of these petitions. List the matters after four weeks. In the meanwhile, all the respondents are at liberty to file written statements, if any.”] and 24-3-2015 [Peerappa Hanmantha Harijan v. State of Karnataka, 2015 SCC OnLine SC 1707, wherein it was directed: “Heard Ms Kiran Suri, learned Senior Counsel for the petitioners in SLPs (C) Nos. 31624 - 25 of 2014 in part. List all the matters as part for further hearing. Vide order dated 17-11-2014, learned counsel for the State as well as the learned counsel for KIADB were directed to produce the relevant records in respect of the proceedings relating to land acquisition involved in these matters, record as well as the records relating to allotment of land. However, as per office records, nothing has been produced so far. In this view of the matter, the learned counsel for the State as well as the learned counsel for KIADB are directed to comply with the order dated 17-112014 and produce the relevant records in respect of the proceedings relating to land acquisition and the allotment of land involved in these matters before the next date of hearing. List the matters on 15-4-2015.”], do not disclose the fact that the acquisition of lands covered in the acquisition notifications are in favour of the Company. Thus, the acquisition of land in favour of KIADB is abundantly clear from the preliminary and final notifications issued by the State Government and thereafter following the procedure under sub-sections (6) and (7) of Section 28 of the KIAD Act, it took possession of the acquired land from the owners who were in possession of the same and was transferred in favour of KIADB for its disposal for the purpose for which lands were acquired as provided under Section 32(2) of the KIAD Act read with the Regulations referred to supra framed by KIADB under Section 41(2)(b) of the KIAD Act. Therefore, the reliance placed upon the judgments of this Court by the learned Senior Counsel on behalf of the Company and KIADB, are wholly inapplicable to the fact situation and do not support the case of the Company.
63. In view of the foregoing reasons recorded by us on the basis of the acquisition notifications issued by the State Government under the statutory provisions of the KIAD Act and therefore, we have to answer Points (i), (ii) and (iii) in favour of the landowners holding that the Company is neither the beneficiary nor interested person of the acquired land, hence, it has no right to participate in the award proceedings for determination of the market value
62
and award the compensation amount of the acquired land of the appellants. Hence, the writ petition filed by the Company questioning the correctness of the award passed by the Reference Court which is affirmed by the High Court is not at all maintainable in law. On this ground itself, the writ petition filed by the Company should have been rejected by the High Court, instead it has allowed and remanded the case to the Reference Court for reconsideration of the claims after affording opportunity to the Company, which order suffers from error in law and therefore, the same is liable to be set aside.
64. Further, the learned Judge of the High Court has erroneously held that the allottee Company is a beneficiary of the acquired land of the appellants, which finding of the learned Judge is not correct both on facts and in law. The findings and reasons recorded by the High Court in the impugned judgment in allowing the writ petition and quashing the award of the Reference Court and remanding it back to the Reference Court and allowing the Company to participate in the proceedings for re-determination of compensation for the acquired land is wholly impermissible in law and the same are in contravention of the provisions of the KIAD Act, the LA Act, the KIADB Regulations and the lease agreement, which has been executed by KIADB in
favour of the Company and therefore, the impugned judgment and order [State of Karnataka v. Peerappa Hanmantha Harijan, Review Petition No. 2537 of 2013 in MFA No. 32157 of 2012, order dated 22-9-2014 (KAR)] is liable to be set aside by allowing the appeals of the owners.
65. Further, the learned Single Judge of the High Court has further committed an error in law in not appreciating Section 54 of the LA Act, which provision provides the right to appeal to the landowners, or State Government and beneficiaries of
the acquired land but not to the company which is the lessee. When the company does not have the right to file an appeal against the award it also has no right to file a writ petition. KIADB has filed the belated appeal after disposal of the appeal filed by the appellants by the High Court and against which award it has filed the present appeal questioning the correctness of the same and prayed for enhancement of compensation and the said appeal is being disposed of by this common judgment after adverting to the
63
rival legal contentions urged on behalf of the parties. The High Court has rightly dismissed the belated appeal filed by KIADB.”
7.3 This Court thereafter had considered the decisions in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd. (supra) and has distinguished the same and has observed and held that the decisions in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd. (supra) shall not be appliable with respect to the acquisition under the KIAD Act, 1966. Once, this Court in the subsequent decision in the case of Peerappa Hanmantha Harijan (supra) dealt with and considered the earlier decisions in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd. (supra) and distinguished the same and observed and held with respect to the acquisition under the KIAD Act, 1966 that the allottee company can neither be said to be a “person interested” nor entitled for hearing before determination of compensation, the said ratio was binding upon the High Court. Thus, it was not open for the High Court to not follow the binding decision of this Court in the case of Peerappa Hanmantha Harijan (supra) by observing that in the subsequent decision in the case of Peerappa Hanmantha Harijan (supra), the earlier decisions in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd. (supra) have not been considered. The High Court has not noted that as
64
such while deciding the case of Peerappa Hanmantha Harijan (supra), this Court did consider the earlier decisions in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd. (supra) and had clearly distinguished the same. Not following the binding precedents of this Court by the High Court is contrary to Article 141 of the Constitution of India. Being a subsequent decision, in which the earlier decisions were considered and distinguished by this Court, the subsequent decision of this Court wasbinding upon the High Court and not the earlier decisions, which were distinguished by this Court.
7.4 Under the circumstances, the High Court has committed a grave/serious error in passing the impugned judgment and order by relying upon the judgments of this Court in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd. (supra) and by not following the subsequent decision of this Court in the case of Peerappa Hanmantha Harijan (supra).
7.5 Now, so far as the reliance placed upon the decisions of this Court in the case of UP Awas Evam Vikas Parishad (supra) and Himalayan Tiles and Marble (P) Ltd. (supra) relied upon by the respondent No.1 – MRPL and even relied upon by the High Court is concerned, at the outset, it is required to be noted that the said decisions were with respect to the
65
acquisition under the Land Acquisition Act, 1894 and the provisions of Land Acquisition Act, 1894, more particularly, Section 50 of the Land Acquisition Act fell for consideration before this Court. As observed and held by this Court in the subsequent decision in the case of Peerappa Hanmantha Harijan (supra), the acquisition under the Land Acquisition Act, 1894 and the acquisition under the KIAD Act, 1966 are both distinct and the provisions under both the Acts are distinguishable.
7.6 We see no reason to take a different view than the view taken by this Court in the case of Peerappa Hanmantha Harijan (supra) that the MRPL being a subsequent allottee after the land was acquired by KIADB, can neither be said to be a beneficiary nor a “person interested” for the purpose of determination of compensation. Under the circumstances, the impugned judgment and order passed by the High Court taking a contrary view is unsustainable and the same deserves to be quashed and set aside.
8. In view of the above and for the reasons stated above, present appeals succeed. The impugned common judgment and order passed by the High Court setting aside the judgment and award/order passed by the Reference Court and remanding the matter to the Reference Court is hereby quashed and set aside. The judgment and order passed by the Reference Court is hereby restored.
66
Present appeals are allowed accordingly. However, in the facts and circumstances of the case, there shall be no order as to costs.”
67
case of Ms.Nooraine Fazal vs. Base Corporation Limited & others – W.A.No.15210/2011 & connected matter Dated 22.04.2022, wherein this Court has held that a post acquisition allottee has no locus standi to challenge de-notification and that the protection under the doctrine of promissory estoppel and legitimate expectation is not available to a post acquisition allottee. In the said judgment, this Court held as under:-
“4. BASE Corporation Limited filed the instant writ petition with following prayers:
“a) Issue a writ of certiorari, or any other appropriate writ, order or direction, quashing the Gazette Notification CPMG/KA/BGGOP/13/2003-05 dated 05.05.2004 issued by the 2nd respondent vide Annexure N to the present writ petition;
b) Issue a writ of mandamus, or any other writ or direction directing the 1st respondent to continue and complete the acquisition proceedings in respect of the land covered; under Survey Numbers 28/1, 28/2 and 29/2 at Kariyammana Agrahara, Varthur hobli, Bangalore South Taluk pursuant to the extraordinary Gazette Notification dated 05.05.2004 bearing No. issued by the 1st respondent vide Annexure N.”
68
10. On February 21, 2004, the Principal Secretary to the Government, C & I Department, wrote to the KIADB that the land was not suitable for the project and acquisition may not be completed; and the amount in deposit be refunded to BASE Corporation. Thereafter, the impugned notification dated May 5, 2004 was issued by the Government withdrawing the proposed acquisition. Feeling aggrieved, BASE Corporation has filed the instant writ petition and the same has been allowed by the Hon’ble Single Judge. Hence, these writ appeals.
45. It was argued by Shri. Ravishankar that BASE Corporation has no vested right in the land. Therefore, the Doctrine of Promissory Estoppel could not have been invoked and the KIADB could not have been directed to allot land to the appellant.
46. In Peerappa Hanmantha Harijan Vs. State of Karnataka, it is held as follows:
“54. A careful reading of the aforesaid provisions of the LA Act, the KIAD Act and the KIADB Regulations would clearly go to show that the Company is neither a beneficiary, nor an interested person in the land as on the date of acquisition of the land, as the land was acquired by the State Government in favour of KIADB who is the beneficiary and it has
69
allotted in favour of the Company after the acquired land was transferred in its favour by the State Government and executed the lease agreement referred to supra.
57. For the acquisition of land under the provisions of the LA Act in favour of a company the mandatory procedure as provided under Part VII of the LA Act and Rules must be adhered to, that is not the case in the acquisition of land involved in these proceedings as the acquisition of land is under the provisions of the KIAD Act and therefore the reliance placed upon the provision of Section 3(f)(viii) of Karnataka LA Amended Act 17 of 1961 is not applicable to the facts of the case on hand and therefore, the said provision cannot be made applicable to the case on hand.”
47. In view of the above legal position, BASE Corporation has no vested right in the land in question and therefore, the Doctrine of Promissory Estoppel could not have been invoked. Accordingly, point (d) is answered in the negative .
48. Further, it is settled that Court cannot compel the Government to acquire a particular property as held in Jayamma v. Commr.
70
49. It was also argued by the appellants and the land owners that large parcels of lands, at and around the land in question have been dropped from acquisition or de-notified. Placing reliance on Bondu Ramaswamy v. Bangalore Development Authority, it was rightly argued by Shri. Ravishankar that acquisition proceedings cannot be initiated in respect of the lands in question as they would be surrounded by large chunks of land which have been omitted from acquisition.
50. It is held in Special Land Acquisition Officer Vs. Godrej and Boyce, that State can be permitted to exercise its power of withdrawal unilaterally.
51. Placing reliance on Shri Ramtanu Coop. Housing Society Ltd. Vs. State of Maharashtra ,it was also argued that special procedure has been designed under the Land Acquisition Act for acquisition of land for the Companies and there is no such provision in the KIADB Act. KIADB Act has its own procedure and there is no provision in the Act for acquisition of land for a Company.
52. In view of the above discussion, we are of the considered opinion that the finding recorded by the Hon'ble Single Judge (that the exercise of discretion is an instance of
71
colourable exercise of power and fraudulent), is not sustainable because, no notice was issued to the Chief Minister and he has not been heard.
53. In view of the subsequent events, particularly, appointment of resolution professional by the NCLT in the liquidation proceedings of BASE Corporation, and the passage of more than 18 years from the date of denotification, we are of the view that the relief sought for by BASE Corporation in the writ petition has become redundant.
54. In the light of above discussion, this appeal merits consideration. Hence, the following:
ORDER
(a) Writ appeals No.15210/2011, 15417/2011 and 15418/2011 are allowed;
(b) Order dated June 9/10, 2011 in W.P. No.19579/2004 is set-aside and the said writ petition is dismissed.
No costs.
72
post-acquisition allottee and protection under the doctrine of legitimate expectation and promissory estoppel cannot be accepted. In fact, the Hon’ble Division Bench has set aside the order of the learned Single Judge of this Court passed in W.P.No.19579/2004 dated 09.10.2011 , which was relied upon by the petitioner.
73
merely / simply a prospective / proposed post acquisition allottee has locus standi to challenge or assail the impugned notification de-notifying / withdrawing the subject lands from acquisition.
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of the subject land had been allotted in favour of the petitioner prior to issuance of the impugned notification dated 02.11.2010 under which, the subject lands have been de-notified / withdrawn from acquisition; further, the petitioner is not the beneficiary or allottee of the subject lands and it is the KIADB which is the beneficiary and consequently, petitioner does not have locus standi to maintain the present petition; so also, no vested right had / has accrued in favour of the petitioner prior to issuance of the impugned notification and consequently, since the petitioner had not acquired any manner of right, title, interest or possession over the subject lands, which were de-notified / withdrawn from acquisition by virtue of the impugned notification, the petitioner does not have locus standi to file, maintain or prosecute the present petition which is not maintainable and liable to be dismissed.
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does not have locus standi to prefer, maintain or prosecute the present petition which is not maintainable in law or on facts and the same is liable to be dismissed. Under these circumstances, though several contentions have been urged by both sides in support of their respective claims, in view of my finding above that the petitioner does not have locus standi to prefer, maintain and prosecute the present petition, I am of the view that the other contentions are not required to be gone into for the purpose of disposal of the present petition.
and the same is hereby dismissed.
Sd/JUDGE
Srl.
3 issues framed by the court
Does a prospective post-acquisition allottee have locus standi to challenge withdrawal of land from KIADB acquisition?
Does project approval under the Facilitation Act create vested rights in land notified for acquisition?
Can legitimate expectation, promissory estoppel or project investment give the prospective allottee standing to challenge de-notification?
Colour shows how this judgement treated each authority
Peerappa Hanmantha Harijan vs State of KarnatakaApplied¶208
Peerappa Hanmantha Harijan vs State of Karnataka – (2015)10 SCC 469, · Who else cites this
Satish Kumar Gupta and Ors. Vs State of Haryana and Ors.Applied¶294
(2017) 4 SCC 760; · Who else cites this
Gregory Patrao and others vs. Mangalore Refinery Petrochemicals Limited and othersApplied¶324
Gregory Patrao and others vs. Mangalore Refinery Petrochemicals Limited and others – Civil Appeal No.4105-4107 of 2022 dated 11.07.2022,
Ms.Nooraine Fazal vs. Base Corporation Limited & othersFollowed¶383
Ms.Nooraine Fazal vs. Base Corporation Limited & others – W.A.No.15210/2011 & connected matter Dated 22.04.2022,
W.P.No.19579/2004 dated 09.10.2011Referred¶412
4 provisions across 2 enactments
AUGUST VENTURES (P) LIMITED
KARNATAKA UDYOGA MITRA
THE KARNATAKA INDUSTRIAL AREAS DEVELOPMENT BORAD
THE SPECIAL LAND ACQUISITION OFFICER THE KARNATAKA INDUSTRIAL AREAS DEVELOPMENT BOARD
THE STATE OF KARNATAKA
K MEENA
S.R.KRISHNA KUMAR
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
