Andhra HC (Pre-Telangana)
Tulsi Co-Operative Housing Society ... vs The State Of A.P. Rep. By The Secretary, ... on 21 November, 1992
Equivalent citations: 1992(3)ALT551
ORDER M.N. Rao, J.
1. One Mohammed Azam (petitioner in S.L.P. No. 1679/89) and his family members are the owners of an extent of Ac. 24-00 of land situate in Bagh Amberpet revenue village within the limits of Hyderabad Municipal Corporation. Out of this, an extent of Ac. 18-03 guntas was notified by the State Government for acquisition under Section 4(1) of the Land Acquisition Act (hereinafter called as the L.A. Act): G.O.Rt. No. 68 dated 4-6-1975 was issued under the HUDCO scheme for construction of houses for persons belonging to economically weaker sections, low income group and middle income group. The urgency clause under Section 17(4) was invoked and the procedure contemplated under Section 5-A was dispensed with. Thereafter the declaration under Section 6 was issued by a further notification dated 25-4-1978. On 6-4-75 M/s. Tulsi Cooperative Housing Society entered into an agreement with Mohd. Azam and others for purchase of the land in order to divide it into plots and allot to its members. On 17-2-76 the Urban Land (Ceiling and Regulation) Act, 1976 (hereafter called as the U.L.C. Act) came into force in the State of Andhra Pradesh. On 21-12-78 Mohd. Azam submitted an application under Section 20(1)(b) of the U.L.C. Act requesting the Government to grant exemption in respect of the notified land from the operation of the U.L.C. Act. Similar applications were also filed by M/s. Tulsi Co-operative Housing Society on 31-5-76 and 6-1-77. The request so far as the notified land is concerned was rejected by the State Government and permission was accorded only to a smaller extent of 14,000 square yards by G.O.Ms. No. 1758 dated 17-10-78 which has no relevance in these cases. Certain guidelines were issued by the Government in G.O.Ms. No. 4270 dated 10-9-80 for granting exemption under the U.L.C. Act. In accordance with those guidelines G.O.Ms. No. 4293 dated 11-9-80 was issued by the Government granting exemption in respect of the notified land for which exemption was rejected earlier as the land acquisition proceedings were pending. A registered sale deed was executed by Mohd. Azam and his family members in respect of an extent of 5 acres of land (a part of the notified land) in favour of M/s. Tulsi Co-operative Housing Society on 31-3-81. W.P. No. 5368/81 was filed by Mohd. Azam challenging the acquisition proceedings. M/s. Tulsi Housing Society also filed another W.P. No. 4455/81 seeking the same relief. One of the contentions raised in both the writ petitions was that invocation of the urgency clause under Section 17(4) of the L:A. Act was illegal in view of the fact that Section 6 declaration was issued after a lapse of three years on 25-4-78. A learned single judge dismissed both the writ petitions on 28-1-1982. Two writ appeals-W.A. Nos. 170 and 171 of 82-were filed against the writ petitions and the same were heard by a Full Bench of this Court which by a judgment dated 2-3-83 allowed them taking the view that "the dispensing with the enquiry under Section 5-A is clearly wrong and cannot be supported."
2. One Bagh Amberpet Welfare Society, a body registered under the Societies Registration Act got itself impleaded as respondents 3 and 4 in the writ petitions and writ appeals. It appears, the society was formed in order to enable persons belonging to economically weaker sections, lower and middle income groups to obtain house-sites. The society claims that its members are beneficiaries of the land acquisition proceedings as the land acquisition proceedings were initiated for allotment of plots to its members. A sum of Rs. 25,14,502/- was deposited by its members with the Municipal Corporation of Hyderabad pursuant to a notification issued by the Special Officer of the Corporation in June, 1981 requesting the Bagh Amberpet Welfare Society to deposit the provisional land value. During the pendency of the writ appeals, applications filed for stay of further proceedings were dismissed and the State Government invoked the powers under Section 47 of the L.A. Act for taking possession. The Executive Magistrate by an order dated 12-2-82 authorised the Tahsildar to take possession removing the obstructions if any and accordingly under a Panchanama dated 21-2-82 the Tahsildar took possession of the land. The Bagh Amberpet Welfare Society preferred Civil Appeal Nos. 5784 and 5785 of 1983 before the Supreme Court against thejudgment of the Full Bench in W.A.Nos. 170 and 171/82 dated 2-3-83. The State Government did not prefer any appeals.
3. During the pendency of the civil appeals in Supreme Court, the State Government issued G.O.Ms. No. 946 dated 23-6-83 cancelling the order of exemption granted in G.O.Ms. No. 4293 date,d 11-9-80. Challenging the cancellation of the exemption order Mohd. Azam filed W.P. 5498 of 1983 and M/s. Tulsi Co-operative Housing Society filed W.P. No. 6500/83. W.P. No. 5498/83 was dismissed by a learned single judge Rama Swamy, J. (as he then was) on 30-6-88 on the ground that the civil appeals were pending in the Supreme Court in respect of the same land. S.L.P. No. 1679/89 was filed by Mohd. Azam before the Supreme Court against the order dated 30-6-88 of the learned single judge. So far as W.P. 6500/83 filed by Tulsi Co-operative Housing Society is concerned, it was directed to be transferred to the Supreme Court by an order dated 9-1-1989 and the transferred case was numbered as T.C. No. 29/89.
4. Both the societies were eager to have the matter compromised. When the matters came up for hearing before the Supreme Court on 7-8-85, the hearing was adjourned to 16-8-85:
"in order to enable the parties to explore the possibility of a settlement..."
At the subsequent date of hearing on 23-8-88, the State Government had agreed to accept the terms of settlement proposed by the two societies and the matter was adjourned by the Supreme Court to enable the counsel for the State of A.P. to take instructions and file a memorandum accepting the arrangement. The Supreme Court in its order dated 23-8-88 while dealing with the contentions of Modh. Azam and M/s. Tulsi Co-operative Housing Society as to the legality of the land acquisition proceedings observed:
"We are not impressed by the stand taken by the petitioners that there was justification for their not approaching the court for six years after the Section 4(1) notification, when they wanted to challenge the denial of the hearing under Section 5-A of the Act and the proceedings itself otherwise. We agree with the learned single judge that the explanation not being acceptable, the writ petitions have been rightly dismissed. On this analysis the appellate judgment of the High Court cannot be sustained and the acquisition proceedings have to be revived."
The State Government had subsequently not agreed for a compromise taking the stand that the proceedings under the U.L.CAct were pending and as there was no exemption, the property would vest in the Government as surplus land under the U.L.C. Act. On 17-8-90 when, the matter came up for hearing the Supreme Court after adverting to the circumstances leading to the filing of the civil appeals, Special Leave Petition and the order relating to the Transferred Case No. 29/89 remanded the matters to this Court for fresh hearing. After adverting to the order made on 23-8-88 (extracted supra) the Court observed:
"This order virtually disposed of the appeals but as the parties were negotiating a settlement the Court did not record a formal disposal of the dispute."
5. Nearly four months after the above order was passed two miscellaneous petitions - I.A.Nos.l and 2 in Civil Appeal Nos. 5784 and 5785 of 1983 - were filed by the Bagh Amberpet Welfare Society and M/s. Tulsi Co-operative Housing Society and the same were disposed of on 4-12-90 by the Supreme Court observing:
"The directions given by us shall be confined to land included in the notification under Section4(1) of the Land Acquisition Act. The I.As. are disposed of accordingly."
6. As conflicting arguments have been advanced regarding the scope of the order of remand, we feel it necessary to extract the relevant portion of the Supreme Court's order:
"If the settlement does hot fructify, the effect of our decision that the acquisition proceedings are to revive, would be that the claim to the land by Tulsi Co-operative Housing Society would come to an end. In that event, at the most that Society would only be entitled to such compensation as may be awardable in law. If the acquisition proceeds the Bagh Amberpet Welfare Society and the Municipal Corporation would have to work out their mutual rights. Apart from these, the two writ petitions challenging the withdrawal of the exemption by order dated 23-6-83 would also have to be disposed of on the merits. The owner's application has been dismissed upon the high Court taking the view that the matter was before this Court and, therefore, the High Court would not entertain the dispute. The challenge by Tulsi Co-operative Housing Society against the said withdrawal was before the High Court for adjudication. In view of the fact that the owner's writ petition was dismissed not on merits but on other consideration, we are of the view that the said dismissal should be vacated and that writ petition should be heard along with writ petition No. 6500/83 as a common question arises for determination. We, therefore set aside the order of the High Court dated 13th of June, 1988 and direct that the said writ petition shall be disposed of afresh on merits.
We are of the view that the entire litigation should go back to the High Court for appropriate disposal. The transferred writ petition, therefore, shall also go back to the High Court and shall be dealt with as Writ Petition No. 6500/83. The two petitions challenging the withdrawal of exemption shall be clubbed together and be heard. The proposals undertaken relating to a settlement in regard to the 18 acres and 3 guntas of land may be considered by the High Court in the light of all relevant material and circumstances. If the High Court is of the opinion that the matter should be settled and the entire land of the owners amounting to 18 acres and 3 guntas should be divided between the two societies, it will be free to do so if Government also agrees thereto. Since that arrangement would be with the consent of the State Government it would in such an event be open to the High Court to nullify the acquisition. The observations we have made at different stages during the pendency of the proceedings in this Court may not be taken to be expression of opinion on the merits and the High Court would be free to deal with the matter in its own discretion and in accordance with law.
In the event of the settlement not coming through the acquisition proceedings would continue under the law and be concluded by the Land Acquisition Officer in accordance with law. In the event of the acquisition working out, the two writ petitions against the withdrawal of exemption would not be sustainable as the land would vest ir Government as a result of acquisition. It would be open to the Government or the acquiring authority to take into account the effect of the laws on urban ceiling. The civil appeals are remitted to the High Court limited to the consideration of the proposals for settlement in the light of the observations hereinabove. Otherwise, they must be taken to have been concluded in this Court on our finding that acquisition proceedings are valid and shall be entitled to continue. The special leave petition of Azam is disposcd of with a direction that the writ petition in the High Court shall be reheard. The transferred writ petition is remitted to the High Court to be disposed of as Writ Petition No. 6500/83. The hearing of the writ petitions would depend upon the fate of the settlement as indicated above.
There would be no order for costs in this Court.
Money, if any, in deposit in the Registry of this Court to the credit of the parties shall be transferred to the High Court and shall be subject to such directions as the High Court may issue upon a final decision of the relevant issues arising in the proceedings."
7. In compliance with the above remand order the cases listed before us are W.A.Nos. 170 and 171 of 1982 (against which Civil Appeal Nos. 5784 and 5785 of 1983 were filed); W.P. No. 5498 of 1983 (against which S.L.P. No. 1679/89 was filed by Mohd. Azam); and W.P. No. 6500 of 1983 which figured as T.C. No. 29/89 in the Supreme Court.
8. The first question for consideration is whether writ appeal Nos. 170 and 171 of 1982 survive for adjudication. W.P.Nos. 5368 and 4455 of 1981 filed by Mohd. Azam and Tulsi Co-operative Housing Society were dismissed by a learned single judge on grounds, inter alia, that the petitioners questioned the legality of the acquisition proceedings six years after the notification under Section 4(1). This view was approved of by the Supreme Court in its order dated 23-8-88, the relevant portion of which has been extracted in the order of remand:
"We agree with the learned single judge that the explanation not being acceptable the writ petitions have been rightly dismissed. On this analysis the appellate judgment of the High Court cannot be sustained and the acquisition proceedings have to be revived."
It is, therefore, plain that writ appeal Nos. 170 and 171 of 1982 filed against the above two writ petitions and which had been allowed by a Full Bench of this Court do not survive for consideration. The direction of the Supreme Court in the order of remand:
"We are of the view that the entire litigation should go back to the High Court for appropriate disposal"
which is general in nature cannot be construed as a direction to rehear afresh Writ Appeal Nos. 170 and 171 of 1982 in view of the Court approving of the ground on which the writ petitions were dismissed by a learned single judge viz., unacceptable delay of six years.
9. Shri M.S.K. Sastry, learned counsel for M/s. Tulsi Co-operative Housing Society contends that the order of remand obligates this Court to consider the question as to whether there was a valid settlement between the parties and what remained to be done was only a formal order recording the compromise and on this hypothesis an argument is advanced that there has been in fact a settlement between all the parties and this Court must give effect to that settlement as per the order of remand.
10. We find little merit in this contention. No doubt compromise talks had reached an advanced stage as is evident from the order of Supreme Court dated 23-8-88 wherein it is specifically mentioned that the State Government:
"....has agreed to accept the terms of settlement and their counsel states that fact to us in Court."
One of the terms of the proposed compromise was that Bagh Amberpet Welfare Society has agreed to purchase the land at the rate of Rs. 3 lakhs per acre which was acceptable to the land owner. The two societies fighting for the land in question had agreed to take equally the total extent of Ac. 18-03 guntas of.land covered by the acquisition proceedings and this fact was intimated to the advocate-on-record by the Special Officer, Municipal Corporation of Hyderabad through letter No. 20/HUDCO/EO/85 dated 29-8-85 in reply to the communication sent by the advocate on 18-8-85 informing that the Supreme Court has suggested a settlement between the parties. In his comments on the compromise petition, the Secretary to the Government had suggested that the State Government:
"need not intervene in regard to land acquisition as compromise has arrived at between both the aggrieved parties."
At this stage the State Government did not accept the compromise taking the stand before the Supreme Court that proceedings under the U.L.C. Act were pending and as there was no exemption from the operation of the provisions of the Act the property was liable to vest in the Government as surplus land. This fact was recorded by the Supreme Court in the order of remand. It is, therefore, not possible to accept the plea of M/s. Tulsi Co-operative Housing Society that a compromise has already been effected, the terms of which bind the parties. Apart from the fact that no memorandum of compromise containing the signatures of the parties to the dispute has been filed before us, the more significant aspect is that the Government Pleader vehemently contends that the Government has not agreed and will not agree for any compromise in the matter. It would, therefore, be totally unrealistic for us to visualise the fact situation as the one covered by Rule 3 of Order XXIII of the C.P.C. The Court cannot compel one of the parties to the dispute namely, the Government to agree for a compromise. The draft memorandum of compromise which was brought on record in the proceedings before the Supreme Court could not attain finality as the Government did not agree for the compromise and the Supreme Court, therefore, could not record the compromise and pass a decree in terms thereof. In this back ground it cannot be said that the parties have compromised the matter and in terms thereof we should pass a decree. The argument in this regard is based on the supposition that there are only two parties to the dispute, namely M/s. Tulsi Co-operative Housing Society and Bagh Amberpet Welfare Society ignoring the primordial fact that the Government also is a party to the dispute and it did not agree for a compromise. The Supreme Court only visualised the possibility of the parties coming to a settlement and that is the reason why in the order of remand the Court observed:
"In the event of the settlement not coming through the acquisition proceedings would continue..."
The Supreme Court made it explicit that the two writ appeals (against which the two civil appeals were filed) are remitted to the High Court, "limited to the consideration of the proposal? for settlement in the light of the observations hereinabove. Otherwise, they must be taken to have been concluded in this Court on our finding that acquisition proceedings are valid and shall be entitled to continue."
11. There is little doubt that in the absence of a settlement between the parties as is the situation obtaining now, the two writ appeals cannot be heard and decided afresh. Accordingly writ appeal Nos. 170 and 171 of 1982 are dismissed.
12. We shall take up for consideration writ petition No. 6500 of 83 filed by M/s.Tulsi Co-operative Housing Society and W.P. No. 5498/83 filed by Mohd. Azam and his family members challenging the legality of the order dated 23-6-83.
13. Under Section 3 of the U.L.C. Act no one is entitled to hold any vacant land in excess of the ceiling limit. In the Hyderabad Urban Agglomeration the ceiling limit fixed under the Act is 1,000 square metres and compensation payable for the land in excess of the ceiling limit shall not exceed Rs. 10 per square metre. Section 20 of the U.L.C. Act confers power on State Government to grant exemption in the public interest or to avoid undue hardship to any person.
14. As already noticed, the State Government on the request of Syed Azam and M/s, Tuisi Co-operative Housing Society issued an order dated 11-9-80 in G.O.-Ms. No. 4293 exempting the entire extent of 24 acres of land from the provisions of Chapter III of\the U.L.C. Act so as to enable Syed Azam and his family members to transfer\the land in favour of M/s. Tulsi Co-operative Housing Society:
"subject to the various conditions specified in the new guidelines issued in G.O.Ms. No. 4270, Revenue, dated 10-9-80."
By this order M/s. Tulsi Co-operative Housing Society was required to file affidavits before the State Government as well as the Special Officer and Competent Authority, Urban Land Ceiling- to the effect that the society will fulfil and comply with the conditions specified in the G.O.Ms. No. 4270 dated 109-80. This exemption was cancelled by the State Government on 23-6-1983 in G.O.Ms. No. 946 on two main grounds:
(1) The conditions of G.O.Ms. No. 4270 dated 10-9-80 subject to which exemption was granted, "have been grossly violated by both the land owners and the society"; and (2) The Tulsi Co-operative Society had illegally entrusted the transaction to a middleagency,namely, M/s. Lakshmi Venkateswara Enterprises, "by entering into an unauthorised agreement for speculative purposes which is highly objectionable, irregular and violative of the conditions of the exemption orders."
The other two incidental reasons mentioned are that the Registrar of Cooperative Societies had reported that the working of M/s. Tulsi Co-operative Housing Society was unsatisfactory and the High Court in W.P. No. 4455 of 1981 observed that the Government erred in granting exemption contrary to the new guidelines issued by them and that the observations of the High Court bind the State Government.
15. The two incidental reasons, in our view, are clearly unsustainable. The judgment in W.P. No. 4455/1981 referred to by the Government was set aside by the Full Bench on 2-3-83 in W.A.Nos. 170 and 171 of 1982. The allegation that the Registrar of Co-operative Societies reported to the Government about the unsatisfactory state of affairs of M/s. Tulsi Co-operative Housing Society cannot be taken serious note of for the reason that along with the show-cause notice which preceded the order of cancellation, a copy of the report of the Registrar of Co-operative Societies has not been furnished although this was stated as one of the grounds in the show-cause notice. It is not possible for the Tulsi Co-operative Housing Society without knowing the contents of the report of the Registrar of Co-operative Societies to submit any explanation as to the alleged unsatisfactory working of the Society.
16. The two main grounds for cancellation of the order of exemption are in effect constitute a single ground namely, that the conditions subject to which the exemption was granted have been flouted by the land owner Azam and M/s. Tulsi Co-operative Housing Society. Sub-paragraphs (1) and (7) of paragraph 2 of G.O.Ms. No. 4270, Revenue, dated 10-9-80 incorporating the guidelines are in the following terms:
"2 (1): The holder of the land should not receive directly or indirectly by way of consideration for the transfer of such land to the housing society, and amount exceeding the amount that he could be entitled to receive as the price of such land under para 4(2) Schedule 1-A of the Urban Land (Ceiling and Regulation) Rules, 1976, if a transfer of that land takes place in pursuance of a scheme under Section 21 of the Act, (which at present is either ten times the net average annual income actually derived from the land for the period of five consecutive years referred to in clause (a) of Sub-section (1) of Section 11, whichever is higher); and the holder of the land shall not claim or receive any sum in addition to, or in excess of such price, provided however, that the stamp duty and registration fees payable in respect of the deed of transfer shall be paid by the transferee.
(2) xxx xxx (3) xxx xxx (4) xxx xxx (5) xxx xxx (6) xxx xxx (7) The housing society should not transfer the land to any other person, including another housing society but the housing society may transfer the share of each member of that society in such land, such share not exceeding 300 square metres, to such member. The member of the housing society to whom any land and /or dwelling unit has been transferred by such housing society, shall not transfer such land and / or dwelling unit or the dwelling unit constructed by such member on such land to any other person, including another housing society for a period of ten years. The housing society or such member may, however, mortgage such land or dwelling unit to a financial institution for obtaining a loan from it for constructing dwelling unit/units on such land."
17. Both the land owner Azam and the Tulsi Co-operative Housing Society have violated the above conditions. Paragraph 2(1) clearly imposes an obligation on the holder of the land not to receive directly or indirectly, by way of consideration for transfer of the land to a housing society, any amount in excess of what he is entitled to receive under the provisions of the U.L.C. Act and the rules framed thereunder. M/s.Tulsi Co-operative Housing Society had entered into an agreement on 27-3-80 with M/s. Lakshmi Venkateswara Enterprises by which the society agreed to transfer its rights in the land in favour of the latter for a consideration of Rs. 1,65,000/- per acre subject to payment of Rs. 90,000/per acre to Azam and his family members. This transaction clearly brings to light the fact that M/s. Tulsi Co-operative Housing Society had in fact no genuine interest in the land for allotment to its members and that it was interested only in making profit by indulging in acts of speculation; it wanted to make a profit of Rs. 75,000/- per acre. This agreement was referred to in the sale deed dated 31-3-1981 executed by Azam and his family members in favour of Lakshmi Venkateswara Enterprises in respect of 5 acres of land which is part of the land covered by the order of exemption. Both the agreement dt. 27-3-80 and the sale deed dated 31-3-81 are clearly in breach of the above referred conditions subject to which the exemption was granted. There was clear embargo on the land owners from receiving consideration in excess of what they are entitled to under the provisions of the U.L.C. Act and the rules made thereunder and M/s. Tulsi Co-operative Housing Society was forbidden from transferring the land to any other person or housing society as per para 2(1) and (7) of G.O.Ms. No. 4270 dated 10-9-80. As these conditions have been violated the order of cancellation was rightly issued by the State Government. There is absolutely no merit in the argument advanced by the learned counsel for M/s. Tulsi Co-operative Housing Society that because of the earlier agreement between the society and M/s. Lakshmi Venkateswara Enterprises, the value of the land had gone up and therefore, the conditions could not but be breached. The agreement dated 27-3-80 itself was in breach of the conditions subject to which the exemption was granted and, therefore, hardly did it constitute a justifiable ground for committing further breach as evidenced by the sale deed dated 31-3-81.
18. The learned Government Pleader says that the effect of U.L.C. Act and the present acquisition proceedings need not be considered in these writ petitions since option was given to the Government by the Supreme Court by specifically mentioning in the remand order that:
"It would be open to the Government or the acquiring authority to take into account the effect of the laws on urban ceiling."
19. We are not inclined to agree to the suggestion. The Government Pleader has already submitted in no unmistakable terms that the Government have decided to apply the U.L.C. Act and utilize the land as envisaged under the U.L.C. Act and he also placed a copy of the letter dated 5th September, 1991 before us addressed by the Principal Secretary to the Government, Municipal Administration and Urban Development Department to the Advocate-General wherein it was stated that the:
"Government are of the opinion that the land vested in Government can be gainfully utilized for public purpose to subserve the needs of the urban poor as envisaged under the Urban Land (Ceiling and Regulation) Act, 1976."
In what manner it is proposed to be done also is indicated in the letter; a committee will consider the applications of eligible urban poor for allotment of plots and the consideration will also extend to the members of Bagh Amberpet Welfare Society and M/s. Tulsi Co-operative Housing Society. In view of this stand of the Government, we feel it necessary to consider the question of the effect of the U.L.C. Act on the acquisition proceedings under the L.A. Act and also the entitlement of the members of Bagh Amberpet Welfare Association for the land in question.
20. Shri Venkata Ramanaiah, learned counsel for the land owners contends that the present acquisition proceedings cannot be withdrawn for purpose of applying the U.L.C. Act for the reason that the notification under Section 4(1) of the L.A. Act was issued as far back as 4-6-75 long before 17-2-76, the date on which the UX.C. Act came into force in the State of Andhra Pradesh and possession was taken on 12-2-82 under Section 47 of the L.A. Act by obtaining orders from the Special Executive Magistrate of Hyderabad in proceedings No.A/30/1982. The acquisition proceedings, therefore, must go on without any impediment and the Government cannot invoke the provisions of the U.L.C. Act after possession was taken and the land was vested in the Government free from all encumbrances.
21. Broadly supporting this line of argument, Shree Veerabhadraiah, learned counsel for Bagh Amberpet Welfare Association, respondent No. 3 in W.P. No. 6500/83 says that the acquisition of the land in question under the L.A. Act was for a public purpose in connection with the HUDCO scheme for construction of houses to economically weaker sections. The membership of the Welfare Association is 374 and they have already deposited so far a sum of Rs. 40,20,649-04 pursuant to the directions issued by the Special Officer, Municipal Corporation of Hyderabad towards earnest money deposit, land value, development and betterment charges. The original purpose for acquiring the land under the L.A. Act undoubtedly being a public purpose, and after collecting the requisite money from his clients, the Government cannot change the nature of the public purpose with a view to deprive his clients to have the land in question for construction of houses.
22. The twin aspects that require consideration are whether the Government have power to withdraw from the land acquisition proceedings and whether the Bagh Amberpet Welfare Association can be deprived of the right to purchase the land.
23. Shri Venkata Ramanaiah, learned counsel for the land owners in support of his proposition that when once possession was taken under the provisions of the L. A. Act, the acquisition proceedings cannot be withdrawn cited the decisions: Lt. Governor v. Avinash Sharma, State of Madras v. K.N.S. Mudaliar, , B.N. Bhagde v. M.D. Bhagwat, and Spl. Land Acquisition Officer v. M/s. Godrej Boyce, . A similar contention we have considered and rejected in W.A. No. 1395/89 dated 27-10-92 wherein also the above decisions were cited. We observed that the rulings cited:
".... certainly would have been helpful to them had the Ceiling Act not been brought on the statute book. In the face of the legislative command in Section 42 of the Ceiling Act giving overriding effect to its provisions vis-a-vis any other law for the time being in force, the propositions of law laid down by the Supreme Court that when once possession was taken pursuant to a notification issued under Section 17(1) of the L.A. Act and the land was vested in the Government the State was denuded of the power to cancel the notification under Section 21 of the General Clauses Act, nor could the notification be withdrawn under Section 48 of the L.A. Act have no application. Vesting of possession in the Government under the provisions of L.A.Act cannot exclude the operation of the provisions of the Ceiling Act, which is a self contained code. Further, granting of compensation under the L.A. Act in respect of a land falling within the ambit of the Ceiling Act would entail loss of public revenue and it may even result in misuse of public funds as held by the Supreme Court in Dattatraya v. State of Maharashtra ."
24. Following the same we hold that vesting of possession of land in the Government under the provisions of the L.A. Act cannot exclude the applicability of the U.L.C. Act.
25. However, this will not conclude the matter in the present fact situation.
26. There are 374 members in Bagh Amberpet Welfare Association. The acquisition of the land as per the notification dated 4-1-75 in G.O.Rt. No. 68 was for a public purpose - for a housing project under HUDCO scheme. The notification itself was issued pursuant to the proposals submitted by the Municipal Corporation of Hyderabad on 22nd November, 1973 for construction of a housing project under HUDCO scheme and administrative sanction for Rs. 1.32 crores was accorded on 22nd March, 1974. The Municipal Corporation of Hyderabad caused a publication in Deccan Chronicle newspaper on 30th March, 1974 inviting applications from economically weaker sections, low and medium income group people desirous of owning houses in Bagh Amberpet locality. The Bagh Amberpet Welfare Society comprising 374 members belonging to the aforesaid categories of persons deposited in the first instance a sum of Rs. 25 lakhs and the latter issued allotment letters in August, 1975. The details of the remittances made by the 374 members are as follows:-
"DETAILS OF REMITTANCES
1. Earnest Money Deposit (EMD) paid in 1974 Rs. 97,725-00
2. Land value in 1981-82 Rs. 25,49,131-75
3. Lay out permit fees paid in 1982 Rs. 10,089-10
4. Development charges paid in 1982 Rs. 83,658-19
5. Betterment charges paid in 1982 Rs. 12,80,045-00 Total: Rs. 40,20,649-04"
The cost of the land worked out to Rs. 25/- per square yard and the balance represent payments towards development charges, betterment charges, permit fee and earnest money deposit. The Government allowed the acquisition proceedings to remain undisturbed all these years. The object of providing house sites to economically weaker sections and persons belonging to low and middle income groups as is the present case with regard to the Bagh Amberpet Welfare Association, is not a purpose unrelated to the object embodied in subsection (4) of Section 23 of the U.L.C. Act which obligates the State to dispose of the vacant land:
"to subserve the common good on such terms and conditions as the State Government may deem fit to impose."
The State Government, therefore, cannot now retrace its commitment and evolve proposals for distribution of the land in a different manner. The Bagh Amberpet Welfare Association members by depositing the money in response to the representation made by the Municipal Corporation of Hyderabad which did so on behalf of the Government (since the acquisition proceedings were inititated only for the purpose of HUDCO Scheme) had acted to their detriment and, therefore, the Government cannot wriggle out of the situation; the well' recognised principle of equitable estoppel comes into play. Activities of normal human beings are regulated by honesty and consistency. Any commitment made by Government carries greater credibility. The equitable principle of estoppel clearly binds the Government if adherence to the promise held out does not conflict with any statutory mandate. Adverting to the doctrine of estoppel the Supreme Court observed in Olga Tellis v. Bombay Municipal Corporation, :
"The doctrine of estoppel is based on the principle that consistency in word and action imparts certainty and honesty to human affairs."
The doctrine of promissory estoppel springs from considerations of equity and it is intended to avoid injustice. Public bodies as well as individuals are bound to:
"carry out representations of facts and promises made by them, relying on which other persons have altered their position to their prejudice., Per Shah, J. (as he then was) in Century Spinning and Manufacturing Co.Ltd, v. Ulhasnagar Municipal Council "
The doctrine was explained in Motilal Sugar Mills case, :.
".... Where the Government makes a promise knowing or intending that it would be acted on by the promises and in fact, the promisee, acting in reliance on it, alters his position the Government would be held bound by the promise and the promise would be enforceable against the Government at the instance of the promisee, notwithstanding that there is no consideration for the promise and the promise is not recorded in the form of a formal contract as required by Article 299 of the Constitution."
These principles were restated by the Supreme Court in Union of India v. Godfrey Phillips India Ltd, .
27. The learned Government Pleader's assertion that it is open to the Government to change the nature of public purpose and they are at liberty to go back on the earlier commitment viz., the purpose for which the acquisition was made under the L.A. Act does not merit acceptance. Invocation of the principle of equitable estoppel in the present case would not result in the Government acting contrary to law and the well accepted principle that the doctrine of equitable estoppel cannot be invoked to compel a public authority to act in a manner contrary to law is not attracted. On the other hand, if the Government are allowed to have their way in the matter of distribution of the land it would result in grave injustice and serious hardship to the members of the Bagh Amberpet Welfare Association. The hopes raised in them as far back as 1975 culminating in the collection of the entire value of the land more than Rs. 45 lakhs by 1982, cannot be shattered because of the abrupt change in the stand of the Government. By depositing the money as required by the Municipal Corporation, the Association members have acquired a right to compel the Government to adhere to the original promise of utilising the land for construction of housing project. Now after a lapse of more than a decade they cannot be asked to take back their money. There is practically very little land available within the limits of Municipal Corporation for housing purposes and even the little available land is out of reach for persons belonging to weaker sections lower and middle income groups as the prices are sky-rocketing. With full faith in the Government money was deposited by the members but unfortunately the litigation has been dragging on for the past twelve years and had they been aware of the fact that ultimately the Government would not honour the commitment they would not have deposited the money. It was in their legitimate expectation that the Government would not break the premise more so when there is no legal impediment to honour the commitment. We are constrained to hold that the State Government have adopted divergent attitudes for reasons not easily discernible by promising the land at one time for housing construction by initiating land acquisition proceedings and at another time resiling from that stand. In our opinion, the Government are bound to honour their commitment to the members of the Bagh Amberpet Welfare Association; the twin principles of equitable estoppel and legitimate expectations come into play with all their rigour.
28. Relying upon the decision of the Supreme Court in Dattatraya v. State of Maharashtra, the learned Government Pleader says that if the acquisition proceedings under the L.A. Act are allowed to proceed unimpeded the Government would be compelled to pay higher compensation thereby public funds which would otherwise be available for welfare activities would be cornered by the land owners. We would have agreed with this contention had the fact situation been really so. The compensation amount is not coming from public funds. It was already deposited by the 374 members of the Bagh Amberpet Welfare Association more than a decade ago. Shree Veerabhadraiah, learned counsel for the Bagh Amberpet Welfare Association says that in order to put an end to further litigation from the side of the land onwers his clients are aggreeable to the land owners receiving the amount that is now in deposit. He also says that considering the fact that the compensation amount is calculated at the rate of Rs. 25/- per square yard with reference to the date of 4(1) notification in 1975 for the land which is situate in the heart of the city, the compensation amount is very just and reasonable. We are inclined to agree. The litigation has been going on uninterruptedly for more than 12 years. 374 families belonging to economically weaker sections, low and middle income groups are struggling for over seventeen years to have dwelling units of their own. The compensation amount is not coming from public funds. The purpose of acquisition apart from being a public purpose is also a laudable one in tune with the basic philosophy underlying the U.L.C. Act.
29. Although Shree Venkata Ramanaiah learned counsel for the land owners asserts that the compensation aspect need not be gone into in these cases and his clients should be allowed to work out their rights under the L.A. Act for higher compensation, we are of the considered view that this litigation should not be allowed to drag on any further. There are special equities in favour of the members of the Bagh Amberpet Welfare Association and to some extent the land owners also. The price of Rs. 25/- per square yard in Bagh Amberpet locality in the year 1975 appears to be just and reasonable. We accordingly hold that the land owners will be entitled only to the amount that has been deposited by the members of the Bagh Amberpet Welfare Association towards the land value - Rs. 25,49,131.75. Apart from equitable considerations propelling us to come to this conclusion, there are certain other reasons also.
30. It is contended by Shri Venkata Ramanaiah, learned counsel for the land owners that without any discernible rational basis the Governmentare resorting to the application of U.L.C. Act for purpose of payment of compensation which bears no relation to the market value as the compensation payable is only Rs. 9 /- per square metre under the U.L.C. Act; but in some other cases transparent favouritism is shown by allowing acquisition proceedings to continue under the L.A. Act and ordering payment of compensation as determined by the award passed by the Land Acquisition Officer or the Civil Court in the proceedings under Section 18 enhancing the compensation. He asserted that if details are called for from the Government files the position would be clear.
31. In order to ascertain the correct position we have asked the learned Government Pleader to furnish the details in this regard. In compliance with our direction, the Government Pleader has placed before us a communication sent to him by the Special Chief Secretary to Government in Memorandum No. 1472/U.C.II (1)/83-12 dated 16-10-1992. The memorandum contains two statements. The first statement gives details of the lands acquired and compensation paid under the provisions of the Land Acquisition Act by granting exemption from the provisions of the U.L.C. Act, In 59 cases a total amount of Rs. 6,73,53,257-25 was paid by the Government as compensation under the provisions of the L.A. Act by exempting the lands from the operation of the U.L.C. Act. Only in respect of seven cases, the Land Acquisition Officers after the awards were passed invoked the provisions of U.L.C. Act for purpose of reducing the compensation. In these seven cases as per the second statement annexed to the aforesaid memorandun the compensation determined by the Land Acqusition Officers comes to Rs. 46,07,243-34 paise. It is inexplicable as to what could have been the basis for directing payment of compensation as determined by the L.A. Act by exempting the lands from the provisions of the U.L.C. Act in some cases and in some other cases invoking the U.L.C. Act for purpose of cutting down the quantum of compensation. We have serious misgivings about the attitudes adopted by the Government in these matters.
32. There is yet another unpleasant facet in regard to the working of the U.L.C. Act. Power is conferred on State Government under Section 20 of the U.L.C. Act to exempt any land in the urban agglomeration from the operation of the Act either on the ground of public interest or undue personal hardship. Applications filed by individuals and organisations seeking exemption have been pending with the Government since 1976. As of now, the total number of applications pending is 2,537 as detailed below:
Year No. of Applications pending 1976 47 1977 28 1978 55 1979 50 1980 69 1981 146 1982 922 1983 86 1984 79 1985 85 1986 71 1987 205 1988 167 1989 153 1990 122 1991 119 1992 133 Total 2,537
On a direction from us the learned Government Pleader has placed before us the above details.
33. The U.L.C. Act was enacted for giving effect to the directive principles contained in Article 39(b) and (c) of the Constitution. Proper implementation of the U.L.C. Act depends upon expeditious disposal of applications seeking exemptions; otherwise it is difficult to ascertain the extent of surplus land available under the Act. The pendency of exemption applications since 1976 could not be explained on any rational hypothesis, thus leading to the legitimate inference that the Executive has not effectively carried out the command of the Legislature. In this view of the matter, we think it unnecessary to consider the contentions that the in-action of the Government is deliberate, contrived, expediency oriented and unrelated to the ground realities. It is true that the Legislature enacts laws and the Executive carries out the legislative policy and the Judiciary has nothing to do with either of these two functions. But it is undeniable that the power of judicial review extends to giving appropriate directions to correct situations where the Executive has failed to carry out the legislative command. The role of a judge as an umpire in the field of public law was graphically described by Lawton L.J.:
"I can blow my judicial whistle when the ball goes out of play; but when the game restarts I must neither take part in it nor tell the players how to play., Laker Airways Ltd. v. Dept. of Trade (C.A.) (1977) 2 W.L.R. 234 at 267."
34. The situation is serious enough warranting affirmative action by this Court in the exercise of its power of judicial review. We accordingly direct the Government to dispose of within six months from the date of receipt of a copy of this judgment all the pre-1980 exemption applications and before 31-12-1993 all the pre-1991 applications.
35. In view of our conclusion upholding the legality of G.O.Ms. No. 946 dated 23-6-83 and the obligation on the part of the authorities to complete the acquisition proceedings under the L.A. Act in regard to the Ac. 18-03 guntas of land, M/s. Tulsi Coroperative Housing Society is not entitled to any relief in these cases. As observed by the Supreme Court in the order of remand;
".... at the most that society would only be entitled to such compensation as may be awardable in law,"
in regard to the transactions between the society and the land owners.
36. In the result W.A.Nos. 170 and 1,71 of 1982 are dismissed. W.P.Nos. 6500 of 83 and 5498 of 83, are disposed of with the following directions:
(1) The Land Acquisition proceedings covered by the Section 4(1) notification issued in G.O.Rt. No. 68 dated 4-6-75 in respect of Ac. 18-03 guntas of land shall revive and be completed as expeditiously as possible preferably within three, months from today, the beneficiaries being the 374 members of the Bagh Amberpet Welfare Association who have already remitted a total sum of Rs. 40,20,649.04.
(2) The compensation amount the land owners are entitled to shall be limited only to Rs. 25,49,131.75 and nothing more.
(3) M/s. Tulsi Co-operative Housing Society is at liberty to work out its rights vis-a-vis the land owners.
(4) The applications filed under Section 20 of the U.L.C Act seeking exemptions from the operation of the Act and now pending with the Government since 1976 shall be disposed of as indicated supra.
37. The two statements containing the details about the payment of compensation under the L.A. Act and the U.L.C. Actenclosed to the Government Memorandum No. 1472/U.C.II(1)/83-12 dated 16-10-1992 addressed to the Government Pleader shall form part of the record.
38. There shall be no order as to costs.