Karnataka High Court
Muninanjappa L vs The State Of Karnataka on 20 November, 2012
Author: N. Kumar
Bench: N. Kumar
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
Dated this the 20th Day of November 2012
PRESENT
THE HON'BLE MR. JUSTICE N. KUMAR
AND
THE HON'BLE MR.JUSTICE V. SURI APPA RAO
W.A.Nos. 3135 to 3137 of 2010 (LA-KIADB)
BETWEEN:
1. Muninanjappa L
S/o Late Lakshmaiah
Aged about 49 years
R/o Kithiganahally Village
Bommasandra Post
Hosur Road
Bangalore - 560 099
2. Smt. Beeramma @ Papamma
W/o late Lakshmaiah
Aged about 71 years
R/at No.55, Kithiganahally Village
Bommasandra Post
Hosur Road
Bangalore - 560 099
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3. Mahadevaiah
S/o late Lakshmaiah
Aged about 39 years
R/at No.55, Kithiganahally Village
Bommasandra Post
Hosur Road
Bangalore - 560 099 ...Appellants
(By Sri V. Lakshminarayana, Advocate)
AND:
1. The State of Karnataka
By its Secretary
Department of Industries & Commerce
M.S. Building
Bangalore
2. The Karnataka Industrial Area
Development Board
By its Executive Director
Nrupathunga Road
Bangalore - 560 001
3. The Deputy Commissioner
Bangalore District
Bangalore
4. The Special Land Acquisition Officer
The Karnataka Industrial Area
Development Board
Nrupathunga Road
Bangalore - 560 001
5. Narayana Hrudayalaya
Institute of Cardiac Sciences
A Company Incorporated under
The Companies Act, 1956
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Having its registered at No.258/A
Bommasandra Industrial Area
Bangalore - 560 009 ...Respondents
(By K. Krishna, AGA for R1 and 3;
Sri Nanjunda Reddy, Senior Counsel for R2 and 4;
Sri Naganand, Senior Counsel appearing for M/s. Just Law-
S. Sriranga, Advocate for R5)
These Writ Appeals are filed u/s 4 of the Karnataka
High Court Act praying to set aside the order passed in the
Writ Petition No.26082 of 2005 dated 02-07-2010.
These Writ Appeals coming on for hearing this day,
N KUMAR J., delivered the following:
JUDGMENT
The appellants were the owners of lands bearing Sy.No.1/1 measuring 1 acre 26 guntas, Sy.No.1/2 measuring 1 acre 16 guntas, Sy.No.2/3 measuring 18 guntas, Sy.No.135/2 measuring 2 acres 27 guntas situated at Kittaganahally Village, Attibele Hobli, Anekal Taluk, Bangalore Rural District. The appellants/writ petitioners are claiming title to the said property under a registered Will, dated 25.1.1991, executed by their grandfather by name one Sri Revanna. Their case is that the 1st appellant is the -4- founder Sri Revannasiddeswara Education Trust which is running an educational institution in the suit lands in the name and style of S.R.S. Vidyanikethana in the permanent building constructed by the Trust. The Director of Higher Education has granted permission to start a Higher Secondary Education School from the year 2005-2006. The 1st respondent has issued a notification under Section 3(1) of the Karnataka Industrial Area Development Act. The same was published in the Gazette on 3.12.2002 for acquisition of the appellants' lands along with other lands. Respondent Nos. 1 has issued a notification under Section 28(1) of the Act on 3.12.2002 on the very same day. They are not made parties and are not served with the notice of the said acquisition proceedings. Thereafter, they have proceeded to issue a notification under Section 28(4) of the Act, which was published in the Gazette on 28.5.2005. Their case is that the respondents had earlier issued notifications for acquisition of the land in the aforesaid survey numbers and the same were dropped by passing a resolution. They came -5- to know about the above notifications only after service of notice on 20.6.2005 under Section 28(6) of the Act issued in the name of Sri Revanna. Then they made a representation on 30.6.2005 to the Special Deputy Commissioner, KIADB and also to the Chief Executive Officer, KIADB for permitting them to further develop the institution run by them. As their said request was not acceded to, they preferred writ petitions challenging the acquisition. In the writ petitions, the beneficiary of the said acquisition - Narayana Hrudayalaya Insitution of Cardiac Sciences got itself impleaded as a party viz., the 5th respondent to the said proceedings.
2. Respondent Nos. 2 and 4 have filed their statement of objections contending that in the 235th Board Meeting held on 22.5.2001, they resolved to acquire an extent of 20 acres of land in Kittiganahalli village, Attibele Hobli, Anekal Taluk in favour of Narayana Hrudayalaya Hospitals Private Limited as single unit complex. -6- Accordingly, a preliminary notification under Sections 1(3), 3(1) and 28(1) of the KIADB Act was published on 3.12.2002 notifying the lands to an extent of 20 acres 36 guntas comprising several survey numbers of lands of Kittiganahalli village, Attibele Hobli, Anekal Taluk. It included the appellants' lands also. The notice of acquisition under Section 28(2) was served to the Khatedar - Sri Revanna through his grand son Sri Ravi Kumar K. and Appellant Nos. 1 to 3, through their advocates have filed their objections to the preliminary notification issued by the respondents. One Sri Krishnappa and Sri Srinivas alleging that they are heirs of the Khatedar Sri Revanna have also filed their statement of objections to the preliminary notification of acquisition. The petitioners have actively participated in the acquisition proceedings and objected to the said proceedings. The 4th respondent being not satisfied with the reply, had passed an order under Section 28(3) of the Act by rejecting their objections. Sri Revanna Siddeshwara Education Trust is formed subsequently on 20.8.2004 in order to defeat the -7- purpose of the acquisition proceedings made as per the preliminary notification, dated 3.12.2002. Therefore, the appellants were not running the said educational trust before issuance of the preliminary notification. On declaration of the land in question as an industrial area by the State Government under Section 3(1) of the Act and on the issuance of the preliminary notification under Section 28(1) of the Act, the said lands solely vest with the Government free from all encumbrances. Therefore, the developments, if any, done by the appellants are only at their risk and costs. The respondents took possession of the major portion of the lands and the compensation is also paid to the respective land owners. The 4th respondent has also issued notices as required under Section 28(6) of the Act to the remaining land owners to hand over possession of the said lands for taking possession of the lands acquired under Section 28(4) of the Act.
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3. The lands which were acquired under this notification were allotted to M/s. Narayana Hrudayalaya Hospitals Private Limited as single unit complex, which has taken possession of the property on 29.1.2004, except the property belonging to the appellants in view of the interim order passed by this Court. The acquisition notification was issued as per the law for the public purpose. The allottee is a reputed hospital established and engaged in working for the cause of public health. The said allotment is not for the purpose to help certain individuals as alleged by the appellants. The allegation that KIADB has been the estate agent to allot the lands by depriving the valuable properties of the agriculturist and the same has resettled in miscarriage of justice, is denied. Therefore, they have sought for dismissal of the writ petition.
4. The 5th respondent - beneficiary has also filed a detailed statement of objections contending that their institution is of great repute and specialised in treatment -9- relating to heart ailments. The institution was set up in the year 2001. The hospital has nearly 1000 beds with 22 operating units. Up to 30 heart surgeries are conducted in a day. It is the part of the entire project, which is expected to have 5000 beds and establishing a Health City with speciality hospital for every disease. It's doctors and consultants are considered best in the World. It also imparts training in heart related procedures and it is affiliated to National Board of Examinations, New Delhi; Rajiv Gandhi University of Health Sciences, Karnataka and Para Medical Board, Karnataka. It has established the hospital, which has state-of-the-art equipment for diagnosis, surgery and post-operative care. It has a separate pediatric wing. Almost 40% of the procedures performed in the institution are pediatric treatments. Till date, about 20,000 Cardiac Surgeries, 2,500 Neuro Surgeries, 30,000 Angiograms, 15,000 Cath procedures and 1,500 General Surgeries have been conducted in their hospital. It has also associated with various schemes, which make treatment available and
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affordable to the poor and needy catering to patients from all over India and abroad. Its name has become synonymous with high quality and precision. It is also developing a cancer hospital. The lands, which are subject matter of acquisition, are being utilised for establishing a state of the art cancer hospital. It can treat a number of patients ailing from cancer. The establishment of hospital would sub-serve public interest.
5. It is also further contended that since the building is constructed in violation of the status quo order passed by this Court, they have filed police complaints in this regard. The writ petitions are filed in the year 2005 challenging the final notification, which was issued in the year 2002 and therefore, suffer from delay and laches. Therefore, 5th respondent sought for dismissal of the writ petitions.
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6. The learned Single Judge after considering the rival contentions and taking note of the documents on which reliance is placed by both parties has dismissed the writ petitions. Aggrieved by the said order, these writ appeals are filed.
7. Sri V. Lakshsminarayana, learned Counsel appearing for the appellants contended that the notifications issued under Sections 3(1) and 1(3) of the Act were issued on 19.9.1993. Notification under Section 28(1) of the Act was issued on 15.7.1994. The final notification under Section 28(4) of the Act was issued on 22.7.1996. Acting on the basis of the report submitted by the Special Deputy Commissioner on 10.1.1997, they did not proceed with the acquisition. However, again a preliminary notification was issued on 3.12.2002 notifying 20 acres 36 guntas for the benefit of the 5th respondent-company, which included the appellants' lands. The final notification was issued under Section 28(4) on 19.1.2004 notifying only 10 acres 25 guntas
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out of 20 acres 36 guntas. The said final notification did not include the appellants' lands. It is only on 28.5.2005, a second final notification under Section 28(4) of the Act was issued notifying 8 acres 19 guntas, which included the appellants' lands. A notice under Section 28(6) of the Act was issued to late Sri Revanna on 20.6.2005, on which date he was not alive. Therefore, possession is not taken under Section 28(6) of the Act and the possession continues to be with the appellants. Therefore, he contends that when once these lands have been notified under the Act and ultimately given up, the second notification issued for acquiring the very same land is illegal. Even otherwise, when a final notification was issued on 19.1.2004 notifying only 10 acres 25 guntas out of 20 acres 36 guntas, it means the remaining extent of land is not required for the purpose for which the notification under Section 28(1) of the Act was issued. Therefore, a second final notification under Section 28(4) could not have been issued on 28.5.2005. Further, the learned Counsel relying on a Circular dated 13th May 2010
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issued by the Karnataka Government, contended that the land owners whose lands acquired by the KIADB is entitled to 9683 sq. yards of developed land per acre of the acquired land and therefore, the said benefit in terms of the Circular should be extended to the appellants. Ultimately, he contended the entire extent of land notified for acquisition is given to one individual company, which is not permitted in view of the judgment of this Court in the case of W.A.Nos. 6193-6195/2009 and connected appeals disposed of on 22nd March, 2012 and therefore, he submits that the learned Single Judge was not justified in dismissing the writ petitions.
8. Per contra, Sri Nagananda, learned Senior Counsel appearing for the 5th respondent submits that the appellants have not come to the Court with clean hands. It is only after the issue of preliminary notification for the second time in the year 2002, they created a Trust in the year 2004 to run an educational institution. After obtaining
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an interim order from this Court in these proceedings, the appellants have put up construction illegally. In regard to the submission made by the appellants that they were not served with the notice and the entire acquisition proceedings have proceeded behind their back, he contended that the documents produced in the case would clearly show that they were served with the notice, represented through their advocate, filed their statement of objections, contested the matter and hence, were fully aware of the acquisition proceedings and it is only after three years from the date of preliminary notification, they have preferred the writ petitions, which is not only hit by delay and laches but also shows their conduct. He also contends that the Trust also filed one more writ petition viz. W.P.Nos. 40652-40654/2010 challenging the very same notification seeking a writ of mandamus directing the authorities to re-convey the lands in its favour in consonance with the Circular, dated 3.3.2007 vide Annexure-N in the writ petitions and in the alternative they also sought for quashing of the acquisition proceedings.
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The 5th respondent was also made as a party to the said proceedings. The learned Single Judge after considering the case on merits has dismissed the said writ petitions both on the ground of principles of res judicata and constructive res judicata and also on the ground that it is not maintainable. Thereafter, the said Trust filed an application in these appeals to implead itself as a party. The matter was contested and this Court by a detailed order, dated 11.7.2011, holding that the Trust is neither a necessary nor a proper party to the proceedings dismissed its application. It is submitted that thereafter the authorities have demolished the illegal construction put up in the lands, taken possession of the same and handed over the possession to the 5th respondent and now they have barricaded the entire area and therefore, he submits that no case for interference with the impugned order is made out. He further submitted that the judgment dated 22.03.2012 on which reliance is placed by the appellants is now the subject matter of Special Leave Petition viz., SLP Nos. 20866
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to 20886/2012 and 21310 to 21329/2012 and in the said petitions, the Apex Court has passed an interim order on 27.7.2012 staying the operation of impugned judgment passed by the Division Bench of this Court.
9. The learned Senior Counsel appearing for the KIADB also adopted the said contentions canvassed by the 5th respondent-company.
10. Therefore, the points that arise for consideration in these Writ Appeals are as under: -
(a) Whether successive declarations are permissible under the Act?"
(b) Whether acquisition of land under the Act for the benefit of a single beneficiary is valid?
(c) Whether acquiring land for a Hospital or School or College, falls within the definition of Industrial Infrastructure Facilities?
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POINT (a): SUCCESSIVE DECLARATIONS
11. In the connected appeals decided today along with these appeals in the case of H.N. SHIVANNA AND OTHERS vs STATE OF KARNATAKA AND OTHERS, WA Nos.3189-3201 OF 2010, after elaborate discussion we have held successive declaration under Section 28 (4) of the Act is permissible. The final conclusion reads as under:
"20. ...... The acquisition of land under the Act is for an industrial purpose. Under the scheme of the Act first a notification has to be issued under Section 3(1) of the Act specifying the area to be an industrial area for the purpose of this Act. Section 3 reads as under:
3. Declaration of industrial areas:
(1) The State Government may, by notification, declare any area in the State to be an industrial area for the purposes of this Act.
(2) Every such notification shall define the limits of the area to which it relates.
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21. The object of this provision is to inform the public that the State Government has taken a decision to form an industrial estate in a particular area, so that the said area may not be used for any other purpose. In fact, Section 4 of the Act specifically provides for alteration of industrial area after issue of a notification under Section 3(1) of the Act specifying and declaring any area in the State to be an industrial area. The power is vested under Section 4 of the Act to exclude from any industrial area, any area or include therein any additional area as may be specified in such notification. That is the only mode by which an area which is declared as an industrial area can be excluded from the industrial area. Though the Act came into force from 26th Day of May 1966 Chapter-VII of the Act which deals with acquisition and disposal of land were not made applicable to the entire state of Karnataka. It is only when a land is to be acquired for the purpose of industrial development, after issue of a notification under Section 3(1) of the Act, notification has to be issued under Section 1(3) of the Act making Chapter-VII applicable. After Chapter-VII is made
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applicable to a particular area, then the Government is vested with the power under Section 28(1) of the Act to issue a notification expressing its intention to acquire such land. When such a land is notified it is not as if every owner of the land would object to the acquisition. There are number of owners of the land who may be willing to give their consent to acquisition of the land and accept compensation payable under the Act. At the same time the very object of enacting this Act is establishment and development of industrial area and for making available industrial land to the private entrepreneurs to start industries. If a land owner chooses to challenge the acquisition, certainly it takes time before the acquisition is completed. Therefore under the scheme it is open to the Government to issue a notification under Section 28(4) in respect of lands where there is no opposition to the acquisition or where they are able to serve the land owners, consider their objections and issue notification for acquisition. If there is any delay in service of notice, if there are contests and any order of stay or injunction is obtained from Courts, it is not necessary for the
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Government to wait for conclusion of those proceedings before it could issue a notification under Section 28(4) of the Act. That is precisely the reason why as is clear from the language employed in Sections 28(3) and (4), the Government is empowered to consider the cause shown by each owner and pass appropriate orders and issue declarations in respect of such owners under Section 28(4) of the act. It serves the object of the Act. Similarly it also enables the owners of the land who are consenting for acquisition to get compensation expeditiously. Therefore, seen from all angles the legislature has consciously avoiding the pit falls which were found in the unamended provisions of Section 6 and 5A of the Act and to enable the Government to acquire land piece meal by issue of such successive notifications have not adopted the procedure prescribed under the unamended Sections 6 and 5A of the L.A. Act. In that view of the matter we do not see any substance in the first contention.
Therefore, successive declarations are permissible under the Act, and the impugned notification is not vitiated on that account.
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POINT (b):- INDIVIDUAL BENEFICIARY
12. Under the scheme of the Act land is to be acquired by the Board for public purpose. The land cannot be acquired for a private purpose and that too for an individual entity. In support of their contention reliance is placed on a judgment of the Division Bench of this Court in the case of Kakaral Ravikumar and others V/s. State of Karnataka and others decided on 22nd March 2012 in W.A. Nos. 6193-6195/2009 and other connected matters.
13. In the aforesaid judgment, the notification issued under the Act, specifically mentions the names of two private companies and for setting up their Steel Plant that the land is proposed to be acquired. It is in that context, the Division Bench held the land can be acquired only for the purpose of the Board. As the Board is not developing the acquired land and allotting to the aspiring industrialists, if the industries proposed to be set up in the area is either not feasible or does not get environmental clearance, the very
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purpose of acquisition fails. Having regard to the nature of the industry proposed to be set up, prior environmental clearance as per the Environment Protection Act, 1986 and the Environment Protection Rules, 1986 is a must. The State is embarking on acquisition of private land by exercise of statutory power of the State to acquire private lands which is equivalent of the exercise of power of eminent domain of the State, even in a situation where there is no real public purpose and even without applying its mind to the relevant aspects. It is a clear instance of not only a colourable exercise of power but also arbitrary exercise of power violative of Article 14 of the Constitution of India. Therefore, it was held on an overall examination of the acquisition proceedings and in the background of the operation of the provision of the Karnataka Industries (Facilitation) Act, 2002, the acquisition proceedings cannot be sustained as it is neither law conformant nor procedural conformant and not for a genuine public purpose in the sense it is developing industrial area not by the Board.
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14. In fact, after referring to the judgment of the Hon'ble Supreme Court in the case of RAMTANU CO- OPERATIVE HOUSING SOCIETY LIMITED, held that though the examination by the Supreme Court of the Maharashtra Act was in the context of the constitutional validity of the Maharashtra Act as being repugnant to Central Act than the Land Acquisition Act as they find the purpose of acquisition of land under the Maharashtra Act as well as Karnataka Act, is both for the purpose of developing the industrial area in the State. They were of the view that the law laid down by the two Single Bench decisions were to be over-ruled. From the reading of the aforesaid judgment, it cannot be inferred that under the Act, the land cannot be acquired by the Board for the purpose of developing industrial area by an individual entrepreneur. What is laid down in the aforesaid judgment is that under the Act, land cannot be acquired for an industrial entrepreneur mentioning that purpose. Therefore, after acquiring that land for industrial purpose, it
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is not held that such acquired land cannot be given for setting up of one industry or by one individual or a company.
15. A Constitution Bench of the Supreme Court in the aforesaid case of RAMTANU CO-OPERATIVE HOUSING SOCIETY LIMITED has laid down the law as under:
"21. Counsel on behalf of the petitioners contended that there was procedural discrimination between the Land Acquisition Act and the Act in the present case. It was said that there was a special procedure designed by the Land Acquisition Act for acquisition of land for the companies whereas in the present case the State was acquiring land for companies without adopting the procedure of the Land Acquisition Act. It is to be remembered that the Act in the present case is a special one having the specific and special purpose of growth, development and organisation of industries in the State of Maharashtra. The Act has its own procedure and there it no provision in the Act for acquisition of land for a company as in the case of Land Acquisition Act. In the present case, acquisition
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under the Act is for the purpose of development of industrial estates or industrial areas by the Corporation or any other purpose in furtherance of the objects of the Act. The policy underlying the Act is not acquisition of land for any company but for the one and only purpose of development, organisation and growth of industrial estates and industrial areas. The Act is designed to have a planned industrial city as opposed to haphazard growth of industrial areas in all parts of the State.
The Act is intended to prevent growth of industries in the developed parts of the State. Industries are therefore to be set up in the developing or new parts of the State where new industrial towns will be brought into existence. The object of the Act is to carve our planned areas for industries. On one side there will be engineering industries and on the other there will be chemical industries. There will be localisation of industries with the result that the residents and dwellers of towns and cities will not suffer either from the polluted air or obnoxious chemicals of industries or the dense growth of industries and industrial population, within and near about the residential areas. The Land
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Acquisition Act is a general Act and that is why there is specific provision for acquisition of land by the State for public purpose and acquisition of land by the State for companies. The present Act on the other hand is designed for the sole purpose of development of industrial areas and industrial estates and growth and development of industries within the State. Industrial undertakings or persons who are engaged in industries all become entitled to the facilities on such industrial growth. Under the Land Acquisition Act acquisition is at the instance of and for the benefit of a company whereas under
the present Act acquisition is solely by the State for public purposes. The two Acts are dissimilar in situations and circumstances.
16. Following the judgment, the learned Single Judge of this Court in the case of HEGGAPPANAVARA MARKHANDAPPA & OTHERS VS. STATE OF MYSORE & OTHERS REPORTED IN 1974(1) KAR.L.J. 71, upheld the acquisition of the land for the benefit of M/s. Harihar Polyfibres. It was challenged on the ground that the real
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object of acquisition of land is not a development of industrial area, it is to benefit a particular company which is not the object of the Act. This Court while repelling the said contention has held as under:
"As long as the acquisition of the land is for the purpose of the Act, that negotiations were made with individuals concerned before taking steps for acquisition under the Act cannot, by itself, be regarded as a circumstances justifying an inference that there has been a fraud on power. The essential question to be determined is, as to whether the acquisition is really for the purpose of the Act or it is only a camouflage for achieving some other object. As already mentioned, a notification was issued by the State Government declaring the area in question as an industrial area. The lands were acquired for the purpose of establishing an industry. The expression '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. Even if in a particular place, a single industry is established,
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the same would answer the definition of the expression 'industrial estate', as defined in S.2(7) of the Act. The preamble itself clearly states that one of the objects of the Act is to promote the establishment and orderly development of industries in industrial areas. If, therefore, the lands in question were acquired for the purpose of establishing an industry by M/s. Harihar Polyfibres with a view to secure a planned and orderly development of industries in that particular area, it cannot be said that the action taken for acquisition of the lands amounts to fraud on power".
Then, after referring to the judgment of the Constitution Bench, it was held as under:
"The Supreme Court upheld the validity of the Maharashtra Industrial Development Act, 1961, which, in many respects, is similar to the Act with which we are concerned. Their Lordships of the Supreme Court have emphasized that under the Industrial Development Act, the policy underlying is not acquisition of land for any company, but for the one and only purpose of development,
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organization and growth of industrial estates and industrial areas. If acquisition of land is made under the Act for the purpose of development, organization and growth of industrial estates and industrial areas, the fact that a single industry belonging to a single company or institution was established in a particular area does not mean that the acquisition of the land was for the particular individual or institution and not for the purpose of development, organization and growth of industrial estates and industrial areas. On the facts, I have no hesitation in coming to the conclusion that the lands in question were acquired for the purpose of development, organization and growth of industrial estates and industrial areas in the area in question and not for a particular company. As the acquisition of the lands is for the purpose of the Act, I do not find it possible to accede to the contention of Shri. Venkataranga Iyengar that there has been fraud on power".
17. The Apex Court in the case of P. NARAYANAPPA AND ANOTHER VS. STATE OF KARNATAKA AND OTHERS
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[(2006) 7 SCC 578] was considering the question whether a land can be acquired under the Act in order to benefit the Company, without mentioning the particulars of the said company in the notification. After referring to the definition, clause and Sections 3, 5, 14, 28 and 29 of the Act as well as the preamble. It was held as under :
"An entrepreneur or a company may give proposal to the State Government for setting up an industry or infrastructural facility and the Government may thereafter acquire the land and give it to the Board. It is also possible that after the land has already been acquired and developed by the Board, it may be allotted to an entrepreneur or a company for setting up an industry or infrastructural facility. Therefore, the scheme of the Act does not show that at the time of acquisition of the land and issuing a preliminary notification under Section 28(1) of the Act, the complete details of the nature of the industry or infrastructural facility proposed to be set up should also be mentioned. At this stage what is to be seen is whether the land is acquired for development by the Board or for any other
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purpose in furtherance of the objects of the Act, as mentioned in Sub-Section (1) of Section 28 of the Act. In fact, if the contention raised by the learned Senior Counsel for the appellants is accepted, it would mean that even at the stage of preliminary notification under Section 28(1) of the Act, nature of the activity which may be done by some entrepreneur or a company which may give a proposal for setting up an industry or infrastructural facility much after land has been acquired should also be taken note of and specifically mentioned in the notification, which is well-nigh impossible. While interpreting the provisions of the Act, the Court should not only take into consideration the facts of the present case but should also have in mind all possible contingencies. Therefore, on a plain reading of the language used in the Act, it is not possible to accept the contention of the learned Senior Counsel for the appellants that the impugned notification is vague and cryptic as the complete details of the project which was proposed to be established by Vikas Telecom Limited (P) Ltd., (Respondent No.9) were not mentioned and on account of the aforesaid lacuna, the land owners
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deprived of their right to make a proper representation or to show-cause against the proposed acquisition".
18. The Land Acquisition Act is a general Act. It provides for acquisition of the land needed for public purpose and acquisition of land by the State for Companies. Karnataka Industrial Area Development Board Act, 1966, was enacted for the orderly establishment and development of industries in suitable areas in the State. This Act defines "amenity", "development", "industrial area" and "industrial estate". After liberalization of work and industrial policies in the year 1991, increased emphasis has been given for private sector not only in the industrial sector but also in the infrastructural sector. As such, the number of proposals, both from indigenous and foreign Companies were received for considerable investments in infrastructural areas like establishment of power projects, express highways, ports, airports, townships, industrial parts, etc., These projects
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need considerable extent of land for implementation. Therefore the Karnataka Legislature considered it necessary to amend the Karnataka Industrial Area Development Act, 1966 to enable the Board to acquire land for providing industrial infrastructure facilities. Therefore, by way of the amendment made by Act, 11 of 1997, Section 2(7-a), defining "industrial infrastructure facilities" was inserted on 19.02.1997. As the definition shows, anything which contributed to the development of industries, any industrial area like technology parks, town ships for the purpose of establishing trade and tourism centers and other facility as the State Government may notify, will be the industrial infrastructural facility. It therefore shows that the object of the Act is not only to secure, establishment of industrial areas and orderly development of industries, but also to create facilities which contribute to the development of industries.
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19. Section 28 of the Act, deals with acquisition of the land. It reads as under:
"28. Acquisition of land: (1) If at any time, in the opinion of the State Government, any land is required for the purpose of development by the Board, or for any other purpose in furtherence of the objects of this Act, the State Government may by notification give notice of its intention to acquire such land.
(2) On publication of a notification under sub-
section (1), the State Government shall serve notice upon the owner or where the owner is not the occupier, on the occupier of the land and on all such persons known or believed to be interested therein to show cause; within thirty days from the date of service of the notice, why the land should not be acquired.
(3) 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, the State Government may pass such orders as it deems fit.
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(4) After orders are passed under sub-section (3), where the State Government is satisfied that any land should be acquired for the purpose specified in the notification issued under Sub-section (1), a declaration shall, by notification in the official Gazette, be made to that effect.
(5) On the publication in the official Gazette of the declaration under sub-section (4), the land shall vest absolutely in the State Government free from all encumbrances (6) Where any land is vested in the State Government under sub-section (5), the State Government may, by notice in writing, order any person who may be in possession of the land to surrender or deliver possession thereof to the State Government or any person duly authorized by it in this behalf within thirty days of the service of the notice.
(7) If any person refuses or fails to comply with an order made under sub-section (5), the State Government or any Officer authorized by the State Government in this behalf may take
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possession of the land and may for that purpose use such force as may be necessary.
(8) Where the land has been acquired for the Board, the State Government, after it has taken possession of the land, may transfer the land to the Board for the purpose for which the land has been acquired.
20. Sub-section (1) of Section 28 reads as under:
28(1) If at any time, in the opinion of the State Government, any land is required for the purpose of development by the Board, or for any other purpose in furtherence of the objects of this Act, the State Government may by notification give notice of its intention to acquire such land.
21. Therefore it is clear that the said provision confers power on the State Government to acquire land for two purposes:
(a) for the purpose of development by the Board.
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(b) for any other purpose in furtherance of the object of this Act.
Sub-section (5) of Section 28 provides that on the publication in the official gazette of the declaration under sub-section (4), the land shall vest absolutely in the State Government free from all encumbrances. Sub-Section (6) and (7) empowers the Government to take possession of the land. Sub-section (8) of Section 28, empowers the State Government to transfer the land to the Board for the purpose for which the land has been acquired. Section 32 empowers the State Government to place at the disposal of the Board, any land vested in it. Sub-section (2) of Section 32 provides, the land transferred to the Board may be developed by the Board or the land may be developed under the control and supervision of the Board. Therefore, it is not necessary that the Board alone has to develop the land. It expressly provides for development of such land under the control and supervision of the Board. It has to be necessarily at the instance of the beneficiary of the land.
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22. The reason for this provision is that an entrepreneur or a Company may give a proposal to the State Government for setting up an industry or infrastructural facility and the Government may thereafter acquire the land and give it to the Board. It is also possible that after the land has already been acquired and developed by the board, it may be allotted to an entrepreneur or a company for setting up an industry or infrastructural facility. Therefore, the scheme of the Act does not show that at the time of acquisition of the land and issuing a preliminary notification under Section 28(1) of the Act, the complete details of the nature of the industry or infrastructural facility proposed to be set up should also be mentioned. What is to be seen is, whether the land is acquired for development by the Board or for any other purpose in furtherance of the objects of the Act, as mentioned in sub-section (1) of Section 28 of the Act.
23. Yet another reason is, in Karnataka, a non- agriculturist cannot purchase agricultural land because of
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the prohibition contained in the Karnataka Land Reforms Act, 1961. If a large extent of agricultural land is required for setting up an industry, it is not possible for the said Company or the entrepreneur to purchase the land and set up the industry. He has to necessarily approach the Government for acquisition of land. In that context, the intention behind this legislation is to be appreciated. If the provisions of the Act are interpreted in a narrow manner and held that under the Act, the land cannot be acquired for the purpose of making it available to a entrepreneur or a company for setting up an industry, then the very purpose of the Act would be defeated. In an industrial layout which is formed by the Board, only small industries could be set up. If a medium scale industry or large scale industry have to be set up and industrial township of such industry is to be established, then no acquisition could be done under this Act. That is not the object of the Act.
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24. The policy underlying the Act is not acquisition of land for any company but for one and the only purpose of development, organization and growth of industrial estates and industrial areas. The Act is designed to have planned industrial city as opposed to the haphazard growth of industrial areas in all parts of the State. The Act is intended to prevent the growth of industries in a developed part of the State. Industries are therefore to be set up in the developing or new parts of the State where new industrial town will be brought into existence. The object of the Act is to carve out planned areas for industries.
25. The definition of 'industrial estate' in the Act, throws some light on this aspect. '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. Therefore, it is permissible to acquire the land for the purpose of setting up an industry by a company. Even if, in a particular place, a single industry is
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established, the same would answer the definition of the expression 'industrial estate' as defined in Section 2(7) of the Act. If acquisition of land is made under the Act for the purpose of development, organization and growth of industrial estates and industrial areas, the fact that a single industry belonging to a single company or institution was established in a particular area does not mean that acquisition of land was for a particular individual or institution and not for the purpose of development, organization and growth of industrial estates and industrial areas. While interpreting the provision of the Act the Court should not only take into consideration the facts of that particular case but should also have in mind all possible contingencies. Therefore, ultimately, what is to be seen is whether the land is acquired for development by the Board or for any other purpose in furtherance of the object of the Act as mentioned in sub-section (1) of Section 28 of the Act. Therefore, the acquisition of the land for the benefit of an individual or a company is permissible under the Act, as
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long as the said land is utilized for the development, organization and growth of an industry.
POINT (c): HOSPITAL, SCHOOL, COLLEGE
26. Section 2(6) defines 'Industrial area' to mean 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. It is by Act No.11 of 1997, Industrial infrastructural facilities and amenities are included in the definition of industrial area. Infrastructural facilities is also defined in Section 2(7a) as under:
"industrial infrastructural facilities' means facilities which contribute to the development of industries established in industrial area such as research and development, communication, transport, Banking, Marketing, Technology parks and Townships for the purpose of establishing trade and tourism centres; and any other facility as the State Government may by notification
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specify to be an industrial infrastructural facility for the purposes of this Act".
27. Therefore, it is clear, the State Government is vested with the power to specify what are the amenities which are to be provided in an industrial area. In fact, Section 2(1) defines 'Amenity'. Amenity includes road, supply of water or electricity, street lighting, drainage, sewerage, conservancy and such other convenience, as the State Government may by notification specify to be an amenity for the purposes of this Act. By virtue of the said Sub-Section (1) of Section 2, Government of Karnataka has issued a notification on 13th March 1991 specifying what are the amenities for the purpose of the Act. The said notification reads as under:
"NOTIFICATION No.CI 86 SPQ 90, Bangalore, dated 18th March 1991 In exercise of the powers conferred by sub- section (1) of Section 2 of the Karnataka
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Industrial Areas Development Act (Karnataka Act 18 of 1966) the Government of Karnataka hereby specified the following as amenities for the purpose of the said Act:
They shall come into force from the date of their publication in the official gazette.
Banks, Post offices, Telephone and Telex Exchanges, Canteens, Fire Brigade and other service facilities including Zerox facilities.
Disposal of solid wastes and setting up effluent treatment plants.
Tempo/Taxi Terminals, Bus depot and automobile service centres.
R & D Centres, Technical Institutes, Training Institutes, Educational Institutions,
Power Sub-Stations and diesel power generating stations and water supply works.
Hospitals, dispensaries, Hotels, Motels and Health and Holiday Resorts, Cinema Theatres.
Inland container depot, Air Cargo Complex, Weigh Bridges, Godowns and Warehouses.
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Storage and outlets of LPG Cylinders, Chemicals, solvents, Petrol, Diesel, Kerosene and other oils.
Shops for vending of spare parts, Engineering goods, paints and other materials required by the industrial undertakings, food and bakery products etc., Offices of the Organisations such as Karnataka Industrial Areas Development Board, Karnataka State Financial Corporation, Karnataka State Pollution Control Board, Karnataka Electricity Board, etc., which monitor and contribute to industrial development and such other organizations for the benefit of the industrial units.
Housing tenements including housing sites for the employees of industries.
By order and in the name of the Governor of Karnataka T.R. RENUKA ARADHYA Under Secretary to Government (ID) Commerce & Industries Department."
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28. Therefore, the "amenity" includes R & D Centres, Technical Institutes, Training Institutes, Educational Institutions, Power Sub-Stations and Diesel Power generating stations and water supply works, Hospitals, dispensaries, Hotels, Motels and Holiday Resorts and cinema theatres. Therefore, in view of the aforesaid notification issued under Section 2(1) of the Act, establishment of an Educational Institution which is a Nursing School or Nursing College or established by a Hospital like Heart, Cancer Hospitals would fall within the definition of amenity and the land is acquired for the purpose of setting up the said amenities is an industrial purpose under the Act. ON FACTS
29. The petitioners are the owners of the lands in question. Sy.No.1/1, 1/2, 2/3 and 135/2, in all measuring 8 acres 19 guntas situated in Kithiganahalli village, Attibele Hobli, Anekal Taluk, Bangalore Urban District. These lands were notified along with the other lands the total extent
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being 20 acres 36 guntas. The preliminary notification under Section 28(1) of the KIADB Act was issued on 03.12.2002. The final notification under Section 28(4) of the KIADB Act came to be issued on 19.01.2004 in respect of only 10 acres 25 guntas out of 20 acres 36 guntas. The petitioners' lands were not included in the first final notification. However, in the second final notification issued on 28.05.2005 the petitioners' lands measuring 5 acres 29 guntas were included. The material on record discloses that the petitioners formed a Trust by name Sri.Revana Siddeswara Educational Trust on 20.08.2004 i.e., after the issuance of the first final notification and before the issuance of second final notification. Therefore, it is clear that there was no Trust and no Educational Institution run by them prior to the preliminary notification dated 3.12.2002. The said notification was issued for allotting this 20 acres 36 guntas of land in favour of M/s.Narayana Hrudayalaya Hospitals Private Limited as single unit complex, the 5th respondent in these proceedings. The said Institution was
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set-up in the year 2001. The Hospital has nearly 1000 beds with 22 operating units. Roughly about 30 heart surgeries are conducted in a day. The project, after its completion is expected to have 5000 beds and they intend to establish a Healthy City with Speciality Hospital for every disease. It also imparts training in heart related procedures and it is affiliated to National Board of Examination, New Delhi, Rajiv Gandhi University of Health Sciences, Karnataka and Para Medical Board, Karnataka. They have established the hospital with the State-of-the-art equipment for diagnosis, surgery and post-operative care. It has a separate pediatric wing. Almost 40% of the procedures are performed in the paediatric treatment. They have already conducted about 20,000 Cardiac surgeries, 2,500 Neuro surgeries, 30,000 Angiograms, 15,000 catheterization procedures and 30,000 general surgeries. It has also associated with various schemes of the Government, which make the treatment available and affordable to the poor and the needy. They are catering to the patients' needs from all over India and
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abroad. The lands which are the subject matter of acquisition is being utilized for establishing the-State-of-the- art Cancer Hospital. It could treat a number of patients ailing from cancer. The establishment of the hospital would sub-serve public interest. These facts are not in dispute.
30. It was contended on behalf of the appellants that the lease in favour of the 5th respondent is not for setting up of any industry but it is for setting up of Nursing School and Nursing College as is clear from the lease deed dated 4th day of December 2010 which is claimed as supplementary agreement and therefore, it was contended that the purpose for which the land was acquired would not fall within the object of the Act. It was pointed out by the learned Counsel for the Board that the lease-cum-sale agreement dated 23rd August 2010 which was executed by the Board in favour of the 5th respondent, categorically stated that the schedule property was only for the purpose of establishing Nursing School or establishing any other industry permissible under
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law, after obtaining prior approval of the lessor. Therefore, under the lease deed they are permitted to establish a Nursing School or an industry permissible under law.
31. The reliance is placed only on the supplementary agreement where it is stated that the land mentioned in the supplementary deed, Sy.No.135/2 measuring 2 acres 27 guntas is required for the Nursing School and Nursing College and according to him even establishing of Nursing College or Nursing School is an industry as defined under the Act. Now, it is not in dispute from the documents produced by the appellants itself, it is clear that the 5th respondent is running a Nursing School from the year 2003. In other words, the land has also been put to use for the purpose which is leased.
32. As held by us earlier, successive declarations are permissible under the Act, the acquisition of the land for the benefit of a company is permissible under the Act, as the
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land is utilized for the establishment of an industry. Similarly, the establishment of a Nursing School, Nursing College or a Heart or Cancer Hospital, is an 'amenity', which would fall within the definition of "industrial infrastructural facility", the acquisition of the land under the Act is permissible. Therefore, the acquisition is valid and legal and does not suffer from an infirmity as contended by the petitioners.
33. The material on record discloses that the petitioners owned in all 10 acres 6 guntas of land. The entire extent of land is not acquired. What is acquired is only 5 acres 29 guntas of land. They are left with the remaining extent of land where they are residing at present. If the acquisition of the land and a Hospital being constructed adjoining their property, the value of their property without any effort on their part would multiply by several times. They are also entitled to compensation for the land which is acquired not at the rate prevailing on the date
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of preliminary notification but at the rate prevailing on the date of dispossession as granted by the learned Single Judge. In fact, in order to over come this acquisition, after the preliminary notification, they have formed Trust, they have filed the writ petition, obtained an interim order. Under the cover of interim order they have put up unauthorized construction contending that they are in possession and it is only after the disposal of the writ petition, the authorities have to forcibly take possession of the property by demolishing unauthorized structures.
34. It is also on record that the trust filed writ petition No. 40652-40654/2010, challenging the very same notification and also a writ of mandamus directing the authorities to reconvey the land in its favour in consonance with the Circular dated 03.03.2007. The said writ petition came to be dismissed on 15.03.2011. The trust has not preferred any appeal challenging the said order, but the trust filed an application in the present appeal to implead
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themselves, which application on merits was dismissed. Under these circumstances, we are satisfied that the conduct of the petitioners disentitles him from any relief at the hands of this Court. Therefore, we do not see any merit in these appeals also.
Accordingly, these appeals are dismissed. All pending applications are ordered to be filed.
Sd/-
JUDGE Sd/-
JUDGE NSU/ SPS/RBV