Karnataka High Court
The Karnataka Housing Board vs Sri. Kadasiddeshwar S/O Gurunath ... on 18 April, 2024
Author: B.M.Shyam Prasad
Bench: B.M.Shyam Prasad
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RFA No. 100272 of 2015
C/W WA No. 100305 of 2021
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 18TH DAY OF APRIL, 2024
PRESENT
THE HON'BLE MR JUSTICE B.M.SHYAM PRASAD
AND
THE HON'BLE MR JUSTICE G BASAVARAJA
REGULAR FIRST APPEAL NO. 100272 OF 2015 (MON)
C/W
WRIT APPEAL NO. 100305 OF 2021 (LA-KHB)
RFA NO. 100272/2015
BETWEEN:
GURUNATH S/O BHIMAPPA BYAKODI
DEAD BY HIS LR
SRI. DR. KADASIDDESHWARA
S/O LATE GURUNATH BYAKODI
AGED ABOUT 51 YEARS
OCC: DOCTOR
R/AT G1 & 2 SILVER SPRINGS APARTMENT
PRABHAT COLONY, NEAR GANESH TEMPLE
VIDYANAGAR, HUBBALLI
Digitally
signed by DIST : DHARWAD.
ANAND N
... APPELLANT
Location:
HIGH (BY SRI. C.S. PATIL AND
COURT OF
KARNATAKA SRI. RAJASHEKHAR R. GUNJALLI, ADVOCATE)
AND:
1. THE KARNATAKA HOUSING BOARD
BY ITS CHAIRMAN, KAUVERY BHAVAN
KEMPEGOWDA ROAD
BENGALURU - 560 009.
2. THE EXECUTIVE ENGINEER
KARNATAKA HOUSING BOARD
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NC: 2024:KHC-D:6935-DB
RFA No. 100272 of 2015
C/W WA No. 100305 of 2021
CHANAKYAPURI HUBBALLI
DISTRICT : DHARWAD.
3. THE SPECIAL LAND ACQUISITION
OFFICER, KAUVERY BHAVAN
KEMPEGOWDA ROAD
BENGALURU - 560 009.
4. SRI. SRIKANTH J BHAT
AGED ABOUT 50 YEARS,
OCC: ADVOCATE
R/O SAMARTHA, PUNE
BENGALURU ROAD,
OPP TO NEW BUS STAND
DHARWAD.
... RESPONDENTS
(BY SMT.GIRIJA S. HIREMATH, HCGP FOR R3;
SRI.BASAVARAJ V SABARAD, SENIOR ADVOCATE
FOR
SRI. H.R. GUNDAPPA, ADVOCATE FOR R1 & R2;
SRI. K. RAGHAVENDRA RAO, SMT. V. VIDYA IYER &
SRI. SHASHANK HEGDE, ADVOCATES FOR R4)
THIS RFA IS FILED UNDER SECTION 96 OF CPC
SET AGAINST THE JUDGMENT AND DECREE DATED
23.09.2015 PASSED IN O.S. NO. 68/2014, ON THE FILE
OF III ADDITIONAL SENIOR CIVIL JUDGE, HUBBALLI,
DISMISSING THE SUIT FILED FOR RECOVERY OF
MONEY.
IN WA NO. 100305/2021
BETWEEN:
1. THE KARNATAKA HOUSING BOARD
BY ITS COMMISSIONER, CAUVERY BHAVAN
BENGALURU - 560 001.
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NC: 2024:KHC-D:6935-DB
RFA No. 100272 of 2015
C/W WA No. 100305 of 2021
2. THE EXECUTIVE ENGINEER
KARNATAKA HOUSING BOARD
CHANAKYAPURI HUBBALLI
DISTRICT : DHARWAD.
3. SPECIAL LAND ACQUISITION
OFFICER,
KARNATAKA HOUSING BOARD
CAUVERY BHAVAN
KEMPEGOWDA ROAD
BENGALURU - 560 001.
... APPELLANTS
(BY SRI. BASAVARJ V. SABARAD., SENIOR ADVOCATE
FOR; SRI. H.R. GUNDAPPA, ADVOCATE)
AND:
1. SRI. KADASIDDESHWAR
S/O GURUNATH BYAKODI
AGED ABOUT 51 YEARS,
OCC: DOCTOR
R/O VIDYANAGAR - 580 031
HUBBALI, DHARWAD DISTRICT.
2. THE PRINCIPAL SECRETARY
DEPARTMENT OF URBAN DEVELOPMENT
AND HOUSING, M.S. BUILDING
BENGALURU - 560 001.
... RESPONDENTS
(BY SMT. GIRIJA S. HIREMATH, HCGP R2;
R1 SERVED )
THIS APPEAL IS FILED UNDER SECTION 4 OF THE
HIGH COURT ACT, 1961 PRAYING TO SET ASIDE THE
ORDER DATED 08.10.2021 IN WP NO. 101046/2021 (LA-
KHB) PASSED BY THE LEARNED SINGLE JUDGE AND
DISMISS THE WRIT PETITIONS WITH COSTS
THROUGHOUT.
THESE APPEALS COMING ON FOR
PRONOUNCEMENT OF JUDGMENT THIS DAY, B.M.
SHYAM PRASAD J., DELIVERED THE FOLLOWING:
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NC: 2024:KHC-D:6935-DB
RFA No. 100272 of 2015
C/W WA No. 100305 of 2021
ORDER
The common question for consideration in this regular appeal and intra-court appeal is the whether the sale deed dated 23.08.2006 executed in favour of the Karnataka Housing Board [hereafter referred to as the 'KHB'] must be declared void but on different grounds. If in the civil Suit it is urged that this sale deed is vitiated by fraud and misrepresentation, in the writ proceedings it is urged that this sale deed is invalid because the sale deed is without the prior approval as contemplated under the provisions of Section 33(1) of the Karnataka Housing Board Act, 1962 [for short, 'the KHB Act']; and of course, it is also contended that the lack of this statutory prior approval is in issue even in the civil suit.
2. The civil Suit is in O.S.No.68/2014 on the file of the III Additional Senior Civil Judge, Hubballi [for short, 'the civil Court'] and the writ proceedings is in W.P.No.101046/2021. The appeal in -5- NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 R.F.A.No.100272/2015 is filed calling in question the civil Court's judgment and decree dated 23.09.2015 refusing to interfere with sale deed. The intra-court appeal in W.A.No.100305/2021 is filed calling in question the Writ Court's order dated 08.10.2021. The Writ Court has declared that the sale deed dated 23.08.2006 is void because of the lack of statutory prior approval. The writ Court has directed the appellant to refund a sum of Rs.1,07,64,600/- [the sale consideration] along with interest at the rate of 6% from the date of the sale till the date of the payment.
3. The plaintiff in O.S.No.68/2014 is referred to accordingly in this judgement, and the appellant, who has continued the appeal as against the judgment in this suit on the demise of the plaintiff and who has filed the petition in W.P.No.101046/2021 and certain other earlier proceedings detailed hereafter, is referred to -6- NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 accordingly. The suit in O.S.No.68/2014 and writ proceedings in W.P.No.101046/2021 are after a flurry of proceedings commenced with the execution and registration of the impugned Sale Deed dated 23.08.2006. As such, the facts are captured first in precis and the other proceedings are referred to later. Brief Statement of the facts:
4. The KHB [the first defendant in the suit in OS No. 68/2014] has proposed a Housing Scheme called '100 Dwelling Housing Scheme' in about 400 acres in different survey numbers of Gamanagatti and Suthagatti Villages1 under the provisions of the KHB Act, and its Commissioner has addressed communication dated 30.05.2006 to the State Government for permission as contemplated under Section 33[1] of the KHB Act for the purchase of 400 1 The Government Order in this regard is in No.DOH.178.KHB.2000 and dated 25.01.2001, but this Government Order is not placed on record either in the original proceedings or in the writ proceedings.-7-
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 acres of land in Sy. Nos.150 to 157 and in Sy. Nos.259 to 282 of Gamanagatti Village and in Sy. Nos.16 to 27 of Suthagatti Village. The State Government has accorded such permission by its Order dated 17.06.2006. The communication from the KHB and the subsequent State Government Order dated 17.06.2006 are after the meetings convened on 17.03.2006 and 28.04.2006 by the Deputy Commissioner for the KHB officials and the owners of the different lands to verify the consensus value of the required lands.
4.1 The State Government by its Order dated 17.06.2006 has accorded permission to the KHB purchase 400 acres in Sy. Nos.150 to 157 and in Sy. Nos.259 to 282 of Gamanagatti Village and in Sy. Nos.16 to 27 of Suthagatti Village free from all encumbrances at the rate of Rs.6,90,000/- per acre. The plaintiff, who admittedly participated in the aforesaid meeting on 17.03.2006, has executed -8- NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 Consent Letter dated 26.06.20062 offering to transfer the land in Sy.No.29/1, measuring 15 acres 24 guntas, Suthagatti Village, Hubballi Taluk [hereafter referred to as, 'the subject property'] at the rate of Rs.6,90,000/- per acre stating that the sale price could be given to him after discharging the loan outstanding as against the security of the subject property.
4.2 The plaintiff, after this Consent Letter, has executed the impugned sale deed dated 23.08.2006 conveying the subject property, and he has admittedly invested the consideration received from the sale of the subject property to purchase the following lands under the respective Sale Deeds3:
• The land bearing Sy. No.86/1+2+3A [measuring 3 acres 5 guntas] and Sy.No.87/1+2B/1 [measuring 2 acres 24
2 This Letter is marked as Exhibit D.23 in the suit in OS No. 68/2014.
3 The certified copies of the sale deeds hereafter referred to are produced as Exhibits D1 to D6.-9-
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 guntas] of Pale Village, Hubballi Taluk under the sale deed dated 22.01.2007. • The land bearing Sy. No.86/1+2/K [measuring 1 acre 12 guntas] of Pale Village, Hubballi Taluk under the sale deed dated 23.01.2007.
• The land bearing Sy. No.86/1+2+3/B [measuring 6 acres 38 guntas] of Pale Village, Hubballi Taluk under the sale deed dated 07.02.2007.
• The land bearing Sy. No.110/2
[measuring 36 guntas] of Raynal
Village, Hubballi Taluk under the sale deed dated 08.08.2008.
• The land bearing Sy. No.708/10
[measuring 31 guntas] of Unkal
Village, Hubballi Taluk under the sale deed dated 14.08.2008.
4.3 The petitioner has filed the writ petition in W.P. No.62406/2011 because of his dispute with the Income Tax Department as regards the revised Capital Gains filed by him claiming certain exemptions and refund in a sum of Rs.2,24,060/-. The KHB contends that the plaintiff thus, even five
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 years after the date of the sale deed, has accepted that he has received sale consideration at the rate of Rs.6,90,000/- for sale of the subject property and he has invested this amount in purchase of the lands as mentioned above.
4.4 It is undisputed that the subject property is not specifically mentioned in the State Government's order dated 17.06.2006 issued granting approval to the KHB to purchase lands at the rate of Rs.6,90,000/- per acre, but the KHB contends that though this Order does not refer to the subject property specifically, the Scheme/ programme and the accord of permission under the relevant provisions of the KHB Act is for a compact block of 400 acres in the aforesaid two villages. The KHB justifies the purchase of the subject property asserting the following.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 [i] The KHB, because of litigation over title and the applicability of the provisions of the Karnataka Scheduled Caste and Scheduled Tribe [Prohibition of Transfer of Certain Lands] Act, 1978 [for short, 'the PTCL Act'], has not purchased the 400 acres.
[ii] The Subject property are adjacent lands and form a compact block with the lands mentioned in the State Government's Order dated 17.06.2006.
[iii] The KHB, which can modify a
Scheme under the provisions of
Section 23 of the KHB Act, has
sought for necessary approval and the State Government by its Notification dated 18.05.2011 [published in the State Government's Gazette on 10.11.2011] permitted implementation of 100 Dwelling Houses Scheme in 210 Acres, including the Subject property.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 The KHB has also brought on record that the State Government, acting upon its Resolution dated 10.12.2012, has granted approval for purchase of the subject property on 10.04.2013, and that this approval covers not only the subject property but also a couple of other lands.
4.5 The details of the proceedings commenced immediately after the execution and registration of the Sale Deed dated 23.08.2006 are as follows. If one set of proceedings is by the appellant seeking partition of the subject property [and the other properties] contending that his father, the plaintiff, has executed sale deed dated 23.08.2006 in favour of the KHB without his consent though the same is a joint family property, the other set of proceedings are by the plaintiff contending that he was induced to execute the sale deed dated 23.08.2006 misrepresenting that the Government had accorded permission for purchase of the subject property
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 under Section 33[1] of the KHB Act. The details of these proceedings are as follows:
O.S. No.412/2007:
5. The appellant has filed this suit for partition of the subject property and certain other properties against the KHB [and its officials] and the plaintiff. The appellant's maternal aunts, though not initially parties to the suit, are later impleaded. The appellant has inter alia asserted in this suit that the appellant has purchased the subject property under the sale deeds4 dated 29.05.1998 from a certain Sri. Siddaiah [and his family members] utilizing the income from one of the other suit schedule properties mentioned in the plaint.
5.1 The appellant's maternal aunts have filed their written statement asserting that the plaintiff was managing one of the properties left behind by 4 These Sale Deeds are marked as Exhibits in this Suit in Ex. P 3 and 4.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 their father because they could not and also because he was retiring from his service with the Forest Department. As against these submissions, the plaintiff has filed written statement contending that he has purchased the subject property from out of his own income, and insofar as the sale deed dated 23.08.2006 executed in favour of the KHB, the plaintiff has asserted, which is also the core in the present suit, that he was induced to execute the sale deed misrepresenting that there was prior approval by the State Government.
5.2 The civil Court, which was considering Issues such as whether the appellant proves that the subject property [and the other properties] are joint family properties and whether the plaintiff proves that the sale deed dated 23.08.2006 is not binding on him, has dismissed the suit answering both these issues against the appellant and the plaintiff. The civil Court, in fact, has adverted to the common
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 cause of the plaintiff and the defendant that the KHB has purchased the subject property under the aforesaid sale deed without formulation of a Scheme and prior approval as are contemplated under the provisions of the KHB Act.
O.S. No.26/2008:
6. The appellant's sister Smt. Vijaya Dhadooti has filed this suit for partition against the plaintiff and the appellant including certain properties but without including the subject property. The plaintiff and the appellant have joined Smt. Vijaya Dhadooti in filing a compromise application under Order XXIII Rule 3 of CPC, and the suit is disposed of based on this application. The civil Court in its Judgment in O.S. No.412/2007, has observed that the parties in the compromise application have only stated that the compromise is taking into account even those properties that are not mentioned by Smt. Vijaya Dhadooti and to give a final
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 conclusion to all disputes. The civil Court has also drawn certain inferences against the plaintiff and the appellant because of the initiation of this suit in O.S. No.26/2008 without including the subject property and filing a compromise.
R.F.A. No.4066/2012:
7. The appellant has filed the appeal in RFA No.4066/2012 calling in question the civil Court's Judgment in O.S. No.412/2007 and this appeal is dismissed by a Co-ordinate Bench of this Court by the Judgment and decree dated 31.05.2012 while answering the question such as whether the appellant has proved that the plaintiff has purchased the subject property utilizing the joint family nucleus. The Division Bench has observed that the appellant also relies upon a Testament and Will executed by his mother in his favour bequeathing her undivided interest in the subject property, but such bequeath cannot be accepted inter alia for the reason that the
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 appellant's mother has died in the year 1993 and the plaintiff has purchased the subject property from Sri Siddaiah under the sale deeds executed in the year 1998. The Division Bench's Judgment in this appeal is not taken up in further challenge and it has attained finality.
W.P. No.65687/2009:
8. The plaintiff, after the initiation of the above suit in O.S. No.412/2007, has filed this writ petition for quashing the sale deed dated 23.08.2006 executed in favour of the Karnataka Housing Board. The writ Court has dismissed the petition on 12.07.2013 observing that the writ petition is filed on 13.10.2009 calling in question the sale deed executed in the month of August 2006; that there is inordinate delay in filing the writ petition and the plaintiff has not offered any explanation; and that the plaintiff could not even have filed a suit because it is barred by limitation. The writ Court has dismissed the writ
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 petition in the light of the afore on the ground of delay and laches. The writ Court's order in this regard reads as under:
"5. The sale deed was executed on 23.08.2006 and this writ petition was filed on 13.10.2009 i.e. after more than three years from the date of execution of the sale deed. There is no explanation for the inordinate delay in filing the writ petition. The petitioner could not have even filed the suit as on the date of filing of the writ petition as the suit would have been barred by limitation. In my opinion, the writ petition is liable to be dismissed on the ground of delay and laches. Even otherwise, this Court, in exercise of its extraordinary jurisdiction under Articles 226 & 227 of the Constitution of India, cannot examine the validity of the sale deed in question, as recording of evidence is necessary since the petitioner's case that the sale deed is vitiated by undue influence, coercion and misrepresentation is denied by the respondents. The writ petition is accordingly dismissed. In view of dismissal of the writ petition, I.A.No.1/2013 filed for a certain direction
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 does not survive for consideration; it stands disposed of accordingly."
W.A. No.30910/2013:
9. The plaintiff has filed this intra-court appeal calling in question the writ Court's order dated 12.07.2013 in the aforesaid writ petition. The plaintiff's specific case in this intra Court appeal is that the State Government has granted approval for purchase of certain lands but not for the subject property, but he was induced by a third party, at the instance of the KHB, to believe that the State Government's approval included the approval for purchase of the subject property. In fact, the plaintiff has specifically asserted that the KHB could have purchased the property only if there was prior approval, and because there is no such prior approval, the purchase is vitiated.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 9.1 A Division Bench of this Court, referring to the suit in O.S. No.412/2007, has disposed of this appeal opining that the writ Court's order is valid and observing that it would be open to the petitioner to challenge the sale deed dated 23.08.2006 in a civil suit and that neither the dismissal of the writ petition nor the intra-court appeal would come in the way of the petitioner getting appropriate relief in such suit. The Division Bench has examined the plaintiff's grievance in the light of the proposition that acquisition of immovable property by a statutory Body, even if such acquisition is by way of a purchase, cannot be challenged in a suit, and the Division Bench has observed, after referring to the different authorities, that the plaintiff, because he proposes to include the sale deed dated 23.08.2006 on the ground of misrepresentation and fraud, can call in question the sale deed in a civil suit.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 9.2 The plaintiff has carried these decisions in challenge before the Apex Court in S.L.P. No.28739/2013, and this Special Leave Petition is dismissed in limine. The plaintiff has filed the present suit in O.S.No.68/2014 purportedly in terms with the liberty reserved by the Division Bench as aforesaid, and the present writ petition in W.P. No. 101046/2021 is filed after a memo is filed in the first appeal as against the judgment and decree dated 23.09.2015 in OS No. 68/2014. The details of these proceedings are as follows.
O.S.No.68/2014:
10. The plaintiff has filed this suit for setting aside of the sale deed dated 23.08.2006 contending that he will repay the sale consideration of Rs.1,07,64,000/- subject to the direction to the fourth defendant therein to pay a sum of Rs.29,64,000/- either to him or to the other defendants i.e. KHB along with interest. The plaintiff
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 alleges that the latter amount was received from him illegally for facilitating the transaction for the subject property. The plaintiff has also sought for permanent injunction restraining the KHB and the other defendants from interfering with his possession of this property.
10.1 The plaintiff, amongst others, has asserted that he is a victim of circumstances and the sale value at the rate of Rs.6,90,000/- per acre is fixed whimsically. As regards the alleged payment of certain sums, the plaintiff has asserted that the fourth defendant in the suit [a learned member of the Bar acting in cohorts with the KHB and its officials] lured him into believing that he would be able to prevail upon the officials of the KHB to pay compensation at a rate more than Rs.5,00,000/- per acre and that some portion of the amount paid in excess must be paid back to him to be distributed amongst the officials of the KHB. The plaintiff has
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 also asserted that, because of anxiety of losing the subject property for a far lesser value if there is compulsory acquisition, he agreed to execute the Sale Deed dated 23.08.2006 as he had earlier participated in the meeting on 07.03.2006 convened by the Deputy Commissioner, KHB to ascertain the consensus value for the properties.
10.2 The plaintiff, as regards the KHB's authority to enter into negotiations and purchase immovable properties, after an elaborate reference to the provisions of the KHB Act, has specifically contended that there is no prior approval of the State Government to purchase the subject property and as such, the impugned sale deed dated 23.08.2006 is null and void. The plaintiff has averred that he has filed the writ petition in W.P.No.65687/2009 because he was advised that it would not be permissible to call in question a sale deed executed in favour of a statutory body in a suit, and that he has bonafide
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 prosecuted the writ proceedings and the Special Leave Petition, and as such, the time spent in prosecuting these proceedings must be excluded. The plaintiff as regards the possession of the subject property has alleged that there are standing mango, sapota and other fruit bearing trees and he operates an existing borewell to tend to these trees and that the farmhouse is occupied by the labor engaged by him.
10.3 The KHB and its officers [the first to third defendants] have filed their written statement adverting to the aforementioned earlier suits and writ proceedings and denying the allegations of misrepresentation and the plaintiff being lured to execute the sale deed5. The KHB and the other defendants have specifically pleaded that the Government of Karnataka has in the year 2001 5 The fourth defendant has filed his separate written statement on 06.06.2014 denying that he had ever entered into any transaction with the plaintiff for the sale of the subject property in favour of the KHB.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 launched a Scheme called "100 Dwelling Housing Scheme" across the State and that this Scheme is modified from time to time. The State Government has granted approval for purchase of different lands in Sy.No.152-157 and 259-282 of Gamanagatti Village and in Sy.Nos.16-17 of Suthagatti Village, Hubballi Taluk on 17.06.2006. The subject property is abutting this parcel of lands, and the plaintiff, sensing an opportunity of realizing true market value, on his own volition offered to sell the subject property. The plaintiff has accordingly executed the Consent Letter dated 26.06.2006 offering the subject property for sale and the plaintiff cannot renege from the consent signed falsely alleging either misrepresentation or fraud inasmuch he is a retired Senior Officer from the Forest Service.
10.4 The KHB and the other defendants have also averred that the Special Land Acquisition Officer, upon ascertaining that the total extent of land in the
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 aforesaid survey numbers would only be 164 acres though the permission accorded by the State Government is for 400 acres, has informed the Commissioner, KHB that only an extent of 47 acres is purchased because of certain title disputes and because most of the lands were subject to the provisions of the PTCL Act. The Commissioner, KHB, has accorded permission to purchase the subject property and certain other adjacent lands, and the Commissioner has also accordingly informed the State Government vide the Communication dated 13.10.2006. The KHB and the other defendants are thus categorical in their pleadings that the plaintiff has executed the sale deed dated 23.08.2006 on his own accord asserting that the permission for purchase of the subject property is within the approval granted by the State Government on 17.06.2006.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 10.5 The KHB and these defendants have also referred to, as mentioned at the first instance, that the plaintiff has invested the sale price received for the execution of the sale deed for purchase of different lands and the plaintiff acknowledging, in his dispute in W.P.No.62406/2011 with the Income Tax Department for allowance under the provisions of Section 54B and Section 10(37)(iii) and (iv) of the Income Tax Act,1961 [for short, the 'IT Act'] that he has purchased lands utilizing the sale price. As regards the possession of the subject property, their case is that the plaintiff has delivered possession of the subject property simultaneously with the execution of the sale deed and the KHB has incurred a cost of more than Rs.4 Crores in developing the subject property for the purposes of "100 Dwelling Housing Scheme".
10.6 The civil Court in the light of these rival submissions has framed Issues such as whether the
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 plaintiff proves that the KHB and its officials have obtained the impugned sale deed dated 23.08.2006 suppressing material facts from him and by playing fraud on him, whether the sale deed dated 23.08.2006 is a void deed, whether the suit is barred by limitation and whether the plaintiff is in possession of the subject property. The civil Court has also framed additional Issues which require the plaintiff to prove that the fourth defendant [a member of the Bar who allegedly lured him to execute the sale deed] had received a sum of Rs.29,64,000/-.
10.7 The plaintiff has examined himself as PW.1 and he has marked documents Exhibits P1 to P28. These exhibits are essentially the revenue records for the subject property, the Sale Deed dated 23.08.2006, KHB's certain resolutions, orders in the writ proceedings, paper reports and CAG report. The KHB has examined its Executive Engineer [Sri. Sridhar Narayan Joshi] as DW.1, and it has marked
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 documents as Ex. D1 to D33. These exhibits are RTCs for the lands purchased by the plaintiff after the Sale Deed dated 23.08.2006, the certified copies of the sale deeds under which the plaintiff has purchased these properties, the pleadings in the earlier suit in O.S.No.412/2007 and the judgment and orders in the aforesaid suit and the writ proceedings. The KHB has marked the petitioner's Consent Letter dated 26.06.2006 as Ex. D23 and the approved layout plan as Exhibits D32 and D33.
10.8 The civil Court, answering the issue on whether the plaintiff proves that impugned sale deed dated 23.08.2006 is obtained by misrepresentation and by playing fraud on him and that the sale deed is void, after referring to the different authorities relied upon by the rival parties on the proposition to test the claim of misrepresentation and fraud, has opined that [a] the plaintiff has participated in the meeting held on 17.03.2006 under the Chairmanship of the
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 Deputy Commissioner to finalize the consent value, [b] there is no evidence on the officials threatening to acquire the subject property if there is no consensus, [c] if the KHB and its officials had wrongly represented that there was prior approval for purchase of the subject, it was open to the plaintiff [a retired officer from forest service] to go through the documents and verify the same, [d] the plaintiff has not even alleged that the KHB and its officials refused to give him any document, [e] the KHB's internal communications marked as exhibits demonstrate that the discussion was to purchase even those lands that are not specifically mentioned in the State Government's order dated 17.06.2006.
10.9 The civil Court has further opined, after referring to the evidence, that the plaintiff having made a profit from the sale of the subject property cannot impugn the same and if really, there was any misrepresentation of fraud, he should not have
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 waited until the month of August 2009 to issue legal notice when, even according to him, he came to know about the alleged non-inclusion of the subject property in the Government approval upon service of notice in the suit in O.S.No.402/2007. The civil Court has also referred to the evidence of DW.1 to opine that there was no misrepresentation and that the subject property is developed as approved.
10.10 The civil Court, on the question of possession of the subject property, has opined that the evidence demonstrates that the KHB has laid roads and UGD lines and drawn electricity wires through the subject property and that though the plaintiff asserts that he is in possession of the subject property, he has not produced any document, or evidence otherwise, to demonstrate that he is in actual possession of the subject property. The civil Court, on the question of limitation, after a detailed reference to the different proceedings initiated by the
- 32 -
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 plaintiff [and the appellant] from the year 2007 and the different authorities on the applicability of Section 14 of the Limitation Act, 1963, has opined that the suit cannot be dismissed on the ground of limitation.
11. The plaintiff has filed his appeal impugning the civil Court's judgment dated 23.09.2015 in the present first appeal in RFA No.100272/2015. On 18.12.2020, the learned counsel for the KHB has placed on record the KHB's Resolution dated 10.12.2012 and the State Government's Order dated 10.04.2013. The KHB, by the Resolution dated 10.12.2012, has sought for ratification of the purchase of the subject property6 recording that a total extent of 138 acres 13 guntas is purchased in the different survey numbers of Gamanagatti and Suthagatti villages, Hubballi Taluk for the Scheme and that only an extent of 164 acres 6 The adjacent lands in survey No.30 and 31/2 of the same village.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 would be available within 400 acres initially identified. The State Government, in the light of this Resolution, has communicated it approval by its order dated 10.04.2013.
11.1 The plaintiff has died on 12.09.2013 and the appellant has filed the application under Order XXII Rule 3 of CPC asserting that he, because his sister [Smt.Vijaya] has relinquished all her interest in the subject property in terms of the compromise filed in O.S.No.26/2008, is entitled to continue the suit as the sole legal representative. This Court on 07.12.2020 has allowed the application permitting the appellant to continue the appeal as the sole legal heir of the plaintiff.
W.P.No.101046/2021
12. The appellant, with the aforesaid Resolution dated 10.12.2012 and the State Government's Order dated 10.04.2013 being placed
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 on record in the appeal, has filed the writ petition in W.P.No.101046/2021 impugning the KHB's Resolution dated 10.12.2012, the State Government's order dated 10.04.2013 and for quashing of the Sale Deed dated 23.08.2006 on the ground that the impugned Sale Deed is obtained without prior approval. Insofar as the cause of action, the appellant has contended that the KHB has placed on record these documents for the first time in the year 2020 though proceedings were pending and as such, and because his father is no more, he is entitled to call in question these Resolution and Order and for quashing of the Sale Deed dated 23.08.2006.
12.1 The appellant has asserted that the subject property was not required for the purposes of the 100 Dwelling Housing Scheme and therefore was not included in the approval granted on 17.06.2006 under Section 33 (1) of the KHB Act. The prior approval under this provision is mandatory, and
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 because the approval is granted for the first time on 10.04.2013, the purchase of the subject property is without due authority in law. The appellant has contended that if permission could be granted under Section 33 of the KHB Act for purchase the subject property, it should have been prior to the date of purchase.
12.2 The writ Court in the light of these assertions and contentions has framed the following two points for consideration:
[ii] Whether the sale deed dated 23.08.2006 and the acquisition of the subject property without obtaining prior approval from the State Government under Section 33 of the KHB Act is valid and legal, and [ii] Whether this writ petition in W.P.No.101046/2021 is barred
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 either by the principles of res judicata or constructive res judicata. 12.3 The writ court, in the light of the KHB Resolution dated 10.12.2012 and the State Government's approval dated 10.04.2013, has opined that the KHB has purchased the subject property without the State Government's prior approval. The writ Court, while addressing the question whether the absence on lack of prior approval would vitiate the sale deed dated 23.08.2006 rendering it illegal and invalid, has opined that the State Government's prior approval is a sine qua non in view of the provisions of the Section 33(1) of the KHB Act and that ex post facto approval or ratification will be permissible if the statute contemplates the same and if the statutory provision contemplates only prior approval, ex post facto approval or ratification would neither be valid nor cure the defect on account of lack of prior approval.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 12.4 The writ Court on the question of the writ petition being barred by either Res judicata or Constructive Res judicata has opined that in the present case, the question whether the sale deed dated 23.08.2006 was void because of lack of prior approval as contemplated under Section 33 of the KHB Act is not adjudicated either in writ petition in W.P.No.65687/2009 or in writ appeal in W.A.No.30910/2013 or in O.S.No.68/2014. Insofar as the application of constructive Res judicata, the writ Court has also refused to accept the KHB's contention that the writ petition would be barred by constructive Res judicata because of the pending dispute in RFA No.100272/2015 [emanating from the suit in O.SNo.68/2014] opining that this contention cannot be accepted for reasons such as the appeal in RFA No.100272/2015 is still pending adjudication and it has not attained finality and because it is stated on behalf of the appellant that he would withdraw this appeal if it could be opined that this
- 38 -
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 writ petition is not barred by res judicata. The writ Court has also indicated that the liberty reserved by the Division Bench in Writ Appeal No.30910/2013 to the plaintiff to seek cancellation of the Sale Deed dated 23.08.2006, on the ground of fraud and misrepresentation, would inure to the appellant's benefit.
12.5 Sri Gurudas Kannur and Sri C. S. Patil, the learned Senior Counsel and the learned counsel on record for the appellant respectively, and Sri Basavaraj V. Sabarad, and Sri H. R. Gundappa, the learned Senior Counsel and the learned counsel on record for the KHB respectively, are heard. The learned senior Counsels and the learned counsels have taken this Court through the different records that bring forth the different proceedings as referred to above and the rival submissions. The learned Senior Counsels and the learned counsels have also
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 clarified the respective positions when called upon by this Court.
12.6 The plaintiff [as also the appellant], as is obvious from the above, canvass threefold grievance with the sale deed dated 23.08.2006 in the suit in OS No. 68/2014 and in the writ petition in WP No. 101046/2021. The plaintiff in the suit has alleged that the sale deed dated 23.08.2006 is a result of misrepresentation and fraud, and the appellant in the writ petition has alleged that the sale deed dated 23.08.2006 is obtained by the KHB without State Government's prior approval as contemplated under Section 33[1] of the KHB Act. The KHB has contended inter alia that the plaintiff has also urged in this suit that the sale deed dated 23.08.2006 is void because it is without the State Government's prior approval, and therefore, the writ petition by the appellant, who claims under the plaintiff, is barred by res judicata.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 12.7 In the light of these essential rival contentions, which are considered by the civil Court and the writ Court, this Court will have to re-examine the evidence on record to decide the following questions.
[a] Whether this Court must interfere with the Civil Court's opinion in OS No. 68/2014 that the plaintiff has failed to establish that the impugned sale deed dated 23.08.2006 because of misrepresentation and fraud is void, and [b] Whether this Court must interfere with the writ Court's opinion [in W.P.No.101046/2021] that the sale deed dated 23.08.2006 is vitiated and rendered invalid because it is without 'prior approval' of the State Government under section 33(1) of the KHB Act and that the writ petition is not barred by the principles of Res judicata or by Constructive Res judicata.
- 41 -
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 On Civil Court's finding on alleged misrepresentation and fraud:
13. The plaintiff, in support of his allegation of misrepresentation and fraud, has essentially alleged that he was encouraged to participate in the sale transaction [and in the Meeting on 17.03.2006 under the Chairmanship of the Deputy Commissioner to decide on the consensual value of the subject property] because he was falsely made to believe that the State Government has granted necessary sanction of the Scheme/Programme including the subject property, and that there was prior approval for purchase of the subject property. The plaintiff has also alleged that the fourth defendant in the suit in O.S.No.68/2014, taking advantage of the fact that he believed that the true value of the subject property would not be immediately realized if there was compulsory acquisition, lured him to execute the impugned sale deed agree to pay back every part of the sale
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 consideration paid in excess of the rate payable at Rs.5,00,000/- per acre.
13.1 The plaintiff, as regards the first allegation essentially relies upon the State Government's order dated 17.06.2006 which, admittedly, refers to a specific set of survey numbers in Gamanagatti and Suthagatti Villages. This aspect must be considered in detail when the questions of prior approval and res judicata are examined. As regards his case that he was misled to believe that there was prior approval and hence persuaded to participate in the Meeting on 17.03.2006, this Court must observe at the outset that the plaintiff has not placed on record any evidence, neither ocular nor documentary, to substantiate his allegation. The civil Court has observed on appreciation of evidence that the plaintiff, who has retired from Forest Service, is not a lay person and he could have very well verified the documents to ascertain whether the subject property
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 was covered by the State Government's prior approval. The civil Court has also rightly observed that the plaintiff has not even alleged that he requested for certain documents, and the KHB refused to give him those documents.
13.2 The plaintiff's admitted participation in the Meeting on 17.03.2006, the execution of the consent letter dated 26.06.2006, the completion of the transaction with the sale deed dated 23.08.2006 and the utilization of the sale proceeds for purchase of certain other properties completely belies the plaintiff's case of misrepresentation and fraud. Further, the KHB has placed on record material to demonstrate that the plaintiff has purchased 18 acres lands after the transaction under the sale deed dated 23.08.2006. The KHB has marked the certified copy of these sale deeds:
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 Date of the Details of the property Sale Consideration Sale Deed Exhibits The land bearing Sy.
No.708/10 [measuring 31 guntas] of Unkal Village, Ex. D. 1 07.08.2008 Hubballi Taluk Rs.10,00,000/- The land bearing Sy. No.86/1+2+ 3/K [measuring 3 acres 34 guntas] of Pale Village, Hubballi Ex D 2 22.01.2007 Taluk. Rs. 1,30,000/- The land bearing Sy. No.87/1+ 2B/1 [measuring 2 acres 24 guntas] of Pale Village, Hubballi Ex D 3 22.01.2007 Taluk Rs. 2,60,000/- The land bearing Sy. No.86/1+2 +3/B [measuring 6 acres 38 guntas] of Pale Village, Hubballi Ex D 4 07.02.2007 Taluk Rs. 7,00,000/- The land bearing Sy. No.86/1+2+3 /A/1 [measuring 3 acres 5 guntas] of Pale - 45 - NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 Ex D 5 22.01.2007 Village, Hubballi Taluk Rs. 3,20,000/- The land bearing Sy. No.110/2 [measuring 36 guntas] of Raynal Village, Hubballi Ex D 6 08.08.2008 Taluk Rs. 5,00,000/- 13.3 Significantly, the KHB, without any
contra material on record, is able to establish that the petitioner has sought for exemption [allowance] under the provisions of the IT Act primarily relying upon the assertion that he had transferred the subject property under the Sale Deed dated 23.08.2006 and utilized the sale consideration for purchase of the lands. The proceedings in writ petition in W.P.No.62406/2011 in this regard are not disputed.
The plaintiff, who has purchased properties investing the price received for the sale of the subject property availing certain tax exemptions, is trying to retain this benefit while impugning the sale deed upon the
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 condition of returning the sale consideration paid to him for such transfer. This should not only be unconscionable but also impermissible in law.
13.4 The provisions of Section of 647 of the Indian Contract Act,1872 stipulate that a party voiding the contract must restore the benefit received under the contract. In the facts and circumstances of the case, this Court must refer to the proposition stated succinctly in the year 1932 in Mundakath Mathu v. Vishnu Nambudripad8 extracting from an earlier decision. It is stated thus in this decision, and this proposition must apply on all its fours in the present case.
"The principle on which sections 64 and 65 rest is not confined to cases expressly 7 When a person at whose option a contract is voidable rescinds it, the other party thereto need not perform any promise therein contained in which he is promisor. The party rescinding a voidable contract shall, if he has received any benefit thereunder from another party to such contract, restore such benefit, so far as may be, to the person from whom it was received.
8 The Law Weekly, 1932 Page 171
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 included in either of them and is thus stated in Clough v. London North Western Rail Co.
No man can at once treat the contract as avoided by him, so as to resume the property which he parted with under it, and at the same time keep the money or other advantages which he has obtained under it.
This rule is applied as rule of equity and good conscience."
13.5 Further, the plaintiff has stated in his chief examination that the fourth defendant, making him believe that the value for the subject property was fixed at Rs.6,90,000 per acre because of his intervention and there was an assurance to share the amount in excess of the value payable at the rate of Rs.5,00,000/- per acre, constrained him to deposit the cheque issued by the KHB in a particular account, that the fourth defendant collected a self cheque for Rs.2,96,400/- on the date of the sale deed itself, and that after he withdrew this amount, he
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 handed over the passbook to him to ensure that he received only the value at Rs.5,00,000/- per acre. However, the plaintiff, as rightly observed by the civil Court, has not even produced his bank statements to substantiate this allegation.
13.6 It is settled that a party who alleges misrepresentation and fraud must not only plead the necessary details but also place on record evidence that corroborates the allegation, and the plaintiff has failed on both these counts. This Court must also observe that no effort is made to demonstrate that the civil Court's conclusion that the evidence demonstrates that the KHB has laid roads and UGD lines and drawn electricity wires in the subject property is exceptionable. In view of the afore, this Court is of the considered view that the civil Court's Judgment and decree on the ground of misrepresentation and fraud does not call for any
- 49 -
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 interference, and the first question is answered accordingly.
On the lack of 'Prior Approval' under the provisions of the KHB Act
14. The plaintiff's case that the subject property is purchased by the KHB under the sale deed dated 23.08.2006 contrary to the provisions of the KHB Act is firstly on the ground that the State Government has not sanctioned the Scheme, or approved the budget, for the execution of the 100 Dwelling Houses Scheme including the subject property, and secondly, on the ground that there is no prior approval. This aspect of the petitioner's grievance must be considered in the light of the provisions of the KHB Act.
14.1 The provisions of Section 17 the KHB Act, which is in Chapter III of the Act, enable the KHB to incur expenditure and undertake work in any
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 area for execution of Housing Schemes, Land Development Schemes, Infrastructure Development, Construction and disposal of the Commercial premises and the Building Constructions Scheme as it may consider necessary or as may be entrusted to it by the State Government or Government undertakings or under the joint venture or public private arrangements subject to such conditions. The KHB for its Housing Scheme9, notwithstanding anything contained in any other law, may inter alia provide for acquisition of immovable properties by purchase, exchange or otherwise when these properties would be necessary for execution of the Scheme.
14.2 The provisions of Chapter III of the KHB Act also stipulate the terms for preparation of a programme10 [an exercise which is defined under
9. Section 18 of the KHB Act contemplate what the KHB may provide for in a Housing Scheme.
10 The provisions of Section 19 (2) of the KHB Act stipulate that a programme shall contain such particulars of a
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 Section 2(n) of the KHB Act] and a budget therefor with the State Government sanction's thereof and the publication of the programme in the official Gazette. Further, the KHB is vested with the power to submit supplementary programme and budget and to vary, at any time, any programme [and any part included in the programmed sanctioned by the State Government] but subject to the condition that no variation shall be made if it involves an expenditure in excess of 20% of the amount as originally sanctioned for the execution of either Housing Scheme or a Land Development Scheme included in such programme. The provisions of Section 24 of the KHB Act, also in Chapter III, stipulate that KHB can proceed to execute the Programme [which will relate the Schemes as referred to above] only after a programme has been sanctioned and published by the State Government, Housing Scheme, a Land Development Scheme and Labor Housing Scheme which KHB proposes to execute, whether partly or otherwise, during the next year.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 and subject to variation as is contemplated under Section 23.
14.3 In the present case, the KHB relies upon the Government Notification dated 18.05.2011[Annexure R10 in the writ proceedings] to assert that the State Government [as is contemplated under Section 20 of the KHB Act] has accorded, with the varying difficulties to the KHB in the execution of the different Housing Schemes promoted from the year 2001, the budget approval to the tune of Rs. 30,87,098.80 Lakhs for the different Housing Schemes listed in the Schedule - I appended to this notification. It is seen from Entry No. 136 of this Schedule that the budget is approved for the development of 210 Acres of land with 945 houses therein in Gamanagatti and Suthagatti villages.
14.4 The State Government, by this notification, has also directed the Karnataka Housing Board's Directors to undertake certain technical
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 specifications as outlined in Schedule - II of the Order. This Court must opine that this notification, insofar as the present proceedings, puts to rest the plaintiff's case [and the appellant's case] that the State Government has not accorded approval for the construction of dwelling houses in Gamanagatti and Suthagatti villages.
14.5 The provisions of Section 33(1) in Chapter IV of the KHB Act vest in the KHB's Board the power to purchase, lease, exchange or procure by agreement land from any person for the purposes of a Housing Scheme or Land Development Scheme. However, the power to purchase or exchange upon paying compensation to the owners is subject to the condition that is part of the proviso to this sub- section. The provisions of Section 33 of the KHB Act, as it stood prior to amendment11, read as under:
11 These provisions have been substituted by Act No.24/2016 with effect from 28.07.2016 and the permission is contemplated where the project involves land worth more than 250 lakhs and lease is for more than ten years.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 "Section 33. Power to purchase or lease by agreement.- (1) The Board may enter into an agreement with any person for the acquisition form him by purchase, lease or exchange, or any land which is needed for the purposes of a housing scheme or land development scheme or any interest in such land or for compensating the owners of any such right in respect of any deprivation thereof or interference therewith:
Provided that the previous approval of the State Government shall be obtained in case of purchase or exchange involving land worth more than rupees ten lakhs or lease for more than five years.
(2) The Board may also take steps for the compulsory acquisition of any land or any interest therein required for the execution of a housing scheme or land development scheme in the manner provided in the Land Acquisition Act, 1894, as modified by this Act and the acquisition of any land or any interest therein for the purposes of this Act shall be deemed to be acquisition for a public purpose within the meaning of the Land Acquisition Act, 1894."
14.6 In the case of Purchase or exchange [or sharing basis of immovable property in lieu of compensation], as stipulated in proviso to Section
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 33(1) of the Act, the State Government's previous approval is necessary cases of projects involving lands worth more than Rs.10 lakhs or the lease for more than 5 years. The KHB under Section 33(2) of the KHB Act is also vested with authority to take steps for compulsory acquisition of any land through the State Government when required for the execution of a Housing Scheme or a Land Development Scheme.
14.7 As canvassed by Sri Gurudas Kannur and Sri C. S. Patil the question whether prior approval for purchase of lands required for a Scheme is mandatory or not has come up for consideration by the Apex Court in the Karnataka Housing Board and another vs. State of Karnataka and Others12, and the Apex Court has exposited, while considering the question whether initiation of the proceedings for acquisition of land invoking the powers under Section 33(2) of the KHB Act without a 12 2022(11) SCALE 305
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 Housing Scheme or without the sanctioned Housing Scheme under Section 24(2) would be void or non-est, has held that the prior approval as contemplated under Section 33(1) of the KHB Act would be mandatory. This exposition is in paragraph 38 which read as follows:
"Section 33 in Chapter-IV actually deals with the power of KHB to acquire land. Sub-sections (1) and (2) thereof envisage different modes of acquisition which are different in nature. To put it succinctly, in the matter of acquisition under Section 33(1), 'consent' is required and in respect of unwilling owners acquisition may be effected under sub-Section (2) thereof. What is relevant to be noted is that Section 33 deals with acquisition of land or interest thereon and it is not dealing with sanction of the schemes. Obviously, for acquiring land or interest thereon, upon entering into an agreement with any person, by following anyone of the three modes prescribed under Section 33(1) prior approval of the State Government is mandatory, subject to its proviso."
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 14.8 Sri Basavaraj V. Sabarad and Sri H. R. Gundappa do not dispute the proposition that the State Government's prior approval, as contemplated under Section 33(1) of the KHB Act, for purchase of the subject property is mandatory when the value of the project lands [including the subject property] is more than 10 lakhs [as the statutory provision stood at the relevant point of time], but they contend that the writ Court has failed to consider the circumstances which demonstrate the purchase of the subject property is covered by the prior approval granted by the State Government vide Order dated 17.06.2006. In this regard, the learned Senior/learned Counsel emphasize the following:
[a] The State Government, on
17.06.2006 has accorded
permission for purchase of 400 acres at the rate of Rs.6,90,000/- per acre for the purposes of '100 Dwelling Housing Scheme'. The State Government has indeed referred to
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NC: 2024:KHC-D:6935-DB
RFA No. 100272 of 2015
C/W WA No. 100305 of 2021
certain survey numbers in the
villages of Gamanagatti and
Suthagatti, but the approval is for a purchase of a compact parcel of 400 acres.
[b] The Assistant Executive Engineer concerned, in the month of August 2006, has filed a report [after referring to the earlier proceedings resulting with the permission on 17.06.2006] stating that an extent of 47 acres is purchased.
[c] The Assistant Executive Engineer has also reported that the prior approval is for purchase of an extent of 427 acres in the villages of Gamanagatti and Suthagatti, but because of certain civil disputes and the application of the PTCL Act, the KHB can purchase 86 acres 38 guntas in Gamanagatti villages and 78 acres 06 guntas in Suthagatti villages and therefore, the other adjacent lands must be purchased to make a compact block.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 [d] The Commissioner of KHB, in the light of this Report by the Assistant Executive Engineer, has informed the State Government by his Communication dated 26.10.2006 that the prior approval is for purchase of 400 acres and the other lands in these two villages can be purchased limiting the purchase to a compact parcel of 400 acres.
[e] It is after this verification and communication, that the plaintiff has given his consent to sell the subject property pursuant to the prior approval vide the State Government's Order dated 17.06.2006 and that the State Government's decision on 10.04.2013, after the KHB's resolution dated 10.12.2012, is only a ratification and not a fresh approval.
14.9 It is not obvious whether these aspects were canvassed before the writ Court, and the writ
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 Court has premised its opinion on the distinction between the expressions 'approval' and 'prior approval' as interpreted by the Apex Court in Bajaj Hindustan Limited's case (supra). The Apex Court in this decision, while expositing that the expression 'approval' includes ratification and ex post facto approval, has held that if the absence of the expression 'prior' indicates the permissibility of ex- post facto approval or ratification, the use of the expression 'prior' in the statute mandates previous approval or prior approval. The writ Court, based on these propositions, has held ex post facto approval or ratification would not validate or cure the defect on account of want / absence / lack of prior approval.
14.10 However, the controversy for the present is vastly narrowed down with Sri Basavaraj V Sabarad accepting that prior approval under Section 33[1] of the KHB Act for purchase of land [when the value involved in the project is more than the
- 61 -
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 prescribed value] is mandatory. This Court will have to now consider whether the State Government's prior approval vide its Order dated 17.06.2006 could be construed as approval permitting purchase of the subject property. In this regard, this Court must firstly observe that the appellant does not dispute that the State Government has granted prior approval for purchase of a compact parcel of 400 acres of land in Gamanagatti and Suttagatti Villages; that the KHB has not been able to purchase 400 acres as permitted because of certain title disputes and the applicability of the provisions of PTCL Act; that the KHB has ultimately [including the subject property] purchased only 210 and odd acres for the purposes of this project.
14.11 Further, the petitioner also does not dispute that the communication within the KHB and by the KHB with the State Government in this regard is simultaneous with the completion of the
- 62 -
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 transaction for the subject property. These circumstances give the factual context, and within the factual context, this Court will have to examine whether the State Government's prior approval vide Order dated 17.06.2006 would also cover the purchase of the subject property under the impugned sale deed dated 23.08.2006. This Court must also consider the statutory scheme under the KHB Act while examining the aforesaid circumstances.
14.12 As delineated earlier, the State Government grants approval for a programme [which must contain the particulars of the relevant schemes and such other details as are prescribed] under Section 20 of the KHB Act, and the State Government also grants prior approval for purchase of lands required for implementation of the programme [a project] under Section 33[1]. The provisions of Section 24[2] of the KHB Act stipulate that the KHB shall not execute any scheme unless it is sanctioned
- 63 -
NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 by the State Government as part of a programme, but for prior approval under Section 33[1] of the KHB Act, the prohibition against acquiring interest in the required lands is based on the value of the land involved in the project, and the tenure of the lease if there is lease. The requirement of prior approval is not absolute and is necessitated when the value crosses the prescribed limit or the lease is for a tenure beyond the fixed period.
14.13 It follows from these statutory arrangements that firstly a programme is approved by the State Government, and the State Government next grants prior approval to acquire interest in lands subject to the conditions as aforesaid, and as such, the prior approval is in the context of an approved programme including the relevant schemes. This Court must opine that the prior approval must therefore necessarily be understood in the context of a programme [scheme] that is approved. Hence, if
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 there is a controversy on whether there is State Government's prior approval as contemplated under Section 33[1] of the KHB Act, such controversy will have to be resolved reading the prior approval granted in the context of the programme [scheme]. In the present case, with the essential facts as aforesaid not being disputed and admittedly because the subject property is utilized for the purposes of executing the housing scheme in the two villages, this Court is of the considered view that the State Government's Order dated 17.06.2006 will cover the purchase of the subject property. This Court must also observe that only because the State Government has accorded specific permission on 10.04.2013, the efficacy of the prior approval under the Order dated 17.06.2006 is not undermined.
On the grounds of Res- judicata/ Constructive Res judicata and the Writ Court's conclusion in this regard.
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021
15. The KHB's case is that the writ petition is barred by the doctrine of Res judicata or Constructive Res judicata because the question, whether the Sale Deed dated 23.08.2006 is void because of lack of prior approval as contemplated under Section 33 of the KHB Act, is canvassed and adjudicated in the writ proceedings in W.P.No.65687/2009 [and in writ appeal in W.A.No.30910/2013]. The KHB's case is also that the question is raised in the suits in O.S.No.412/2007 and O.S.No.68/2014, and this question is pending adjudication in the present appeal.
15.1 The plaintiff even in the writ petition in WP No. 65687/2009, as part of his grievance with the transaction, has alleged that the sale deed dated 23.08.2006 is void because there is no prior approval of the State Government, but ultimately this writ petition has culminated with a Division Bench of this Court in WA No. 30910/2013 reserving liberty to the
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 plaintiff to file a suit to impugn the sale deed dated 23.08.2006. As such, this Court is in respectful agreement with the writ Court's finding in this regard.
15.2 This Court is not persuaded to opine that this question, though canvassed, is finally adjudicated in the said earlier writ proceedings. In the suit in O.S.No.412/2007, the questions put forth for decision is whether the appellant [as a member of the plaintiff's family] could show that the subject property was joint family property and is transferred by the plaintiff without his consent, and this question is answered finally in the appeal in RFA 4066/2012.
15.3 However, the writ Court has refused to accept the KHB's contention that the writ petition is barred by Res judicata because of the pending dispute in RFA No.100272/2015 [emanating from the suit in O.S. No.68/2014] opining that this contention cannot be accepted for reasons such as the appeal in
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 RFA No.100272/2015 is still pending adjudication and it has not attained finality and because it is stated on behalf of the appellant that he would withdraw this appeal if it could be opined that this writ petition is not barred by res judicata . The writ Court's conclusions in this regard read as under:
"(i) The aforesaid facts and circumstances and the submissions made by the learned senior counsel with regard to the petitioner availing only the remedy of challenging the Sale Deed on the ground of violation of Section 33(1) and withdrawing / abandoning the petitioner's claim for cancellation of the Sale Deed on the grounds of fraud and misrepresentation is sufficient to come to the conclusion that the present petition is not barred by res judicata.
Accordingly, placing on record, the submission made by the learned senior counsel on behalf of the petitioner that the petitioner would withdraw RFA No 100272/2015 and issuing directions to the petitioner in this regard, I am of the considered opinion that the present petition is not barred by res judicata."
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 15.4 The KHB's grievance with this conclusion is essentially because the plaintiff has specifically impugned the sale deed dated 23.08.2006 on the ground that it is void because there was no prior approval as contemplated under Section 33(1) of the KHB Act and as such, the civil Court has also framed an Issue in this regard. The KHB's case in this regard is premised in the contention that when this aspect is pending consideration in the present appeal, the appellant has filed the writ petition taking advantage of the fact that the KHB's Resolution dated 10.12.2012 and the State Government's Order dated 10.04.2013 are placed on record in the appeal.
15.5 The plaintiff, as regards the KHB's authority to enter into negotiations and purchase immovable properties, after an elaborate reference to the provisions of the KHB Act, has specifically contended the following.
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a) The KHB can purchase any immovable property for implementation of Housing Scheme or a Land Development Scheme or a Labour Dwelling Scheme, and the expenditure to be incurred for the execution of the Schemes, as part of a Programme, is included in the annual estimate/budget prepared for the execution of the Scheme/s.
b) The KHB is empowered to purchase [acquire] properties under Section 33 of the KHB Act, and this power can be exercised only where the properties are needed for implementing a Housing Scheme or a Land Development Scheme.
c) This power to purchase is conditioned by the requirement of prior approval of the State Government if the value of the land proposed for a Project is more than Rs.10,00,000/- and this requirement of prior approval is mandatory.
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d) There is no prior approval of the Government to purchase the subject property and as such, the sale deed dated 23.08.2006 is null and void. 15.6 The KHB, in rebuttal to the plaintiff's case that the subject property is purchased without the prior approval under Section 33[1] of the KHB Act [apart from relying upon the statutory scheme refuting the plaintiff's reading of the provisions], has pleaded thus, and the civil Court has framed Issue No. 213 because of these rival pleadings.
"35. As per the letter of the 2nd defendant dated 02.08.2006 written to Housing Commissioner & the 3rd defendant brought to the notice as on that date, 47 Acres of land purchased, whereas Government ordered a purchase of 400 Acres. However it was stated in that letter the Sy. Nos. mentioned in the Government order totally measured only 164 Acres and 2 Guntas. The 2nd defendant had sought for clarification to 13 Issue No. 2. Whether the plaintiff proves that sale deed dated 23.08.2006 is void document?
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 the 3rd defendant, some of the lands under litigation and some of the lands belong to schedule caste and schedule tribes in approved schemes, further he sought for the purchase of adjacent lands situated, not under dispute for the due execution of Housing Scheme.
Accordingly permission accorded by 3rd defendant. The defendant No.1 to 3 of the Housing Board executing the Housing Scheme under no loss and no profit basis, in the interest of general public."
15.7 This Court must observe that it is unmistakably established that the plaintiff and KHB have put in issue in the suit the question of the validity of the Sale Deed dated 23.08.2006 for an alleged lack of prior approval. It is also obvious that the civil Court, in the thicket of the material brought on record, has not rendered its opinion on Issue No.2. However, undeniably, the question relating to the alleged lack of prior approval under Section 33(1) of the KHB Act was pending consideration in the present appeal. As such, the question is whether the
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 petitioner could have invoked the writ petition in WP No. 101046/2011 challenging the sale deed on the ground that the sale deed is without prior approval.
15.8 This Court must opine that as this Court is seized of this question in the appeal in RFA No.100272/2015, the appellant could not have filed the writ petition in WP No. 101046/2021- and that this writ petition is barred definitely by the principle of Constructive Res judicata inasmuch as this principle applies when a given question ought to be subject matter in a pending proceeding. This Court must draw support from the following reiteration by the Apex Court in Samir Kumar Majumder v. Union of India and Others14 "Almost two centuries ago, in Henderson v. Henderson, (1843) 3 Hare, 100, the Vice- Chancellor Sir James Wigram felicitously puts the principle thus:--
14 2023 SCC Online SC 1182
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 "In trying this question I believe I state the rule of the Court correctly when I say that, where a given matter becomes the subject of litigation in, and of adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time. ...."
This principle popularly known as the doctrine of constructive res judicata, based on the might and ought theory, has been recognized by this Court in several judgments."
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NC: 2024:KHC-D:6935-DB RFA No. 100272 of 2015 C/W WA No. 100305 of 2021 15.9 In view of this Court's opinion on the aspect of prior approval and Res judicata, the next question for consideration is answered in favour of the KHB holding that the purchase of the subject property is covered by the State Government's prior approval dated 17.06.2006 and that the writ proceedings in W.P. No.101046/2021 is barred by Res judicata.
ORDER The appeal in RFA No.100272/2015 is dismissed, and the writ appeal in W.A. No.100305/2021 is allowed setting aside the writ Court's order dated 08.10.2021 in W.P. No.101046/2021.
SD/-
JUDGE SD/-
JUDGE nv*