Andhra Pradesh High Court - Amravati
Lavanya Constructions vs The State Of Andhra Pradesh, on 19 March, 2024
IN THE HIGH COURT OF ANDHRA PRADESH: AMARAVATI
HONOURABLE SRI JUSTICE SUBBA REDDY SATTI
WRIT PETITION Nos. 17021, 17024, 17046, 17048,
17280, 17302, 17304, 17306, 17307, 17308, 17309,
17321, 17342, 17756, 17773, 17788, 17791, 17794,
17822, 17851, 17852, 17853; 18031, 18064, 18069,
18073, 18088, 18091, 18092, 18097, 18102, 18105,
18108, 18122, 20530, 21738, 21739, 21773, 21774,
21794; 17475, 18531, 18532, 18541, 18556, 18568;
19214, 19224, 20112, 20138, 20149; 41504 of 2022
and 5638 of 2023
1. W.P.17021 OF 2022
Kalidindi Rukmini v. The State of Andhra Pradesh and others
2. W.P.17024 OF 2022
Rayavarapu Krishna Murthy v. The State of Andhra Pradesh
and others
3. W.P.17046 OF 2022
M/s. PNR Infra Projects v. The State of Andhra Pradesh and
others
4. W.P.17048 OF 2022
Thota Venkata Ananda Rao v. The State of Andhra Pradesh
and others
5. W.P.17280 OF 2022
Akula Bhanoji v. The State of Andhra Pradesh and others
6. W.P.17302 OF 2022
Lavanya Constructions v. The State of Andhra Pradesh and
others
7. W.P.17304 OF 2022
Sri Venkatswara Constructions v. The State of Andhra
Pradesh and others
8. W.P.17306 OF 2022
AVK Builders v. The State of Andhra Pradesh and others
9. W.P.17307 OF 2022
Page 2 of 52
SRSJ
W.P.Nos. 17021 of 2022
and batch
Earle Ramakrishna v. The State of Andhra Pradesh and
others
10. W.P.17308 OF 2022
Ommi Appala Naidu v. The State of Andhra Pradesh and
others
11. W.P.17309 OF 2022
AVK Builders v. The State of Andhra Pradesh and others
12. W.P.17321 OF 2022
Earle Ramakrishna v. The State of Andhra Pradesh and
others
13. W.P.17342 OF 2022
M/s. K.V.R. Developers v. The State of Andhra Pradesh and
others
14. W.P.17756 OF 2022
M/s. K.V.R. Developers v. The State of Andhra Pradesh and
others
15. W.P.17773 OF 2022
M/s. Veda Developers v. The State of Andhra Pradesh and
others
16. W.P.17788 OF 2022
PR Constructions v. The State of Andhra Pradesh and others
17. W.P.17791 OF 2022
M/s Sukrutha Constructions v. The State of Andhra Pradesh
and others
18. W.P.17794 OF 2022
Sarkhall Tahzeebul Hasan v. The State of Andhra Pradesh
and others
19. W.P.17822 OF 2022
D. Chandra Sekhar v. The State of Andhra Pradesh and
others
20. W.P.17851 OF 2022
Paladugu Venkata Madhu Sudhana Rao v. The State of
Andhra Pradesh and others
Page 3 of 52
SRSJ
W.P.Nos. 17021 of 2022
and batch
21. W.P.17852 OF 2022
M/s. Vaibhav Builders v. The State of Andhra Pradesh and
others
22. W.P.17853 OF 2022
M/s. Movva Developers and Builders v. The State of Andhra
Pradesh and others
Counsel for the petitioner/s : Sri N. Ashwani Kumar
Counsel for respondents : GP for Municipal Administration
and Urban Development; Advocate
General; M. Manohar Reddy
23. W.P.18031 OF 2022
M/s Kalpana Constructions v. The State of Andhra Pradesh
and others
24. W.P.18064 OF 2022
M/s. S.V. Infra v. The State of Andhra Pradesh and others
25. W.P.18069 OF 2022
Abhinav Builders and Developers v. The State of Andhra
Pradesh and others
26. W.P.18073 OF 2022
Abhinav Builders and Developers v. The State of Andhra
Pradesh and others
27. W.P.18088 OF 2022
Pioneer Infratech v. The State of Andhra Pradesh and others
28. W.P.18091 OF 2022
Pulikonda Anil Kumar v. The State of Andhra Pradesh and
others
29. W.P.18092 OF 2022
M/s. Mourya Constructions v. The State of Andhra Pradesh
and others
30. W.P.18097 OF 2022
Om Sai Constructions v. The State of Andhra Pradesh and
others
Page 4 of 52
SRSJ
W.P.Nos. 17021 of 2022
and batch
31. W.P.18102 OF 2022
M/s. Hyma Realtors and Builders v. The State of Andhra
Pradesh and others
32. W.P.18105 OF 2022
Potamshetty Prashant and others v. The State of Andhra
Pradesh and others
33. W.P.18108 OF 2022
Sri Gayatri Constructions v. The State of Andhra Pradesh
and others
34. W.P.18122 OF 2022
M/s. Adithya Infra v. The State of Andhra Pradesh and others
35. W.P.20530 OF 2022
Chitturi Sreekanth and others v. The State of Andhra
Pradesh and others
36. W.P.21738 OF 2022
Shaik Khaja v. The State of Andhra Pradesh and others
37. W.P.21739 OF 2022
M/s. KBR Constructions v. The State of Andhra Pradesh and
others
38. W.P.21773 OF 2022
M/s. Premier Properties v. The State of Andhra Pradesh and
others
39. W.P.21774 OF 2022
MJS Yaganti Realtors and Builders v. The State of Andhra
Pradesh and others
40. W.P.21794 OF 2022
Krishnaveni Builders v. The State of Andhra Pradesh and
others
Counsel for the petitioner/s : Sri Unnam Sravan Kumar
Counsel for respondents : GP for Municipal Administration
and Urban Development; Advocate
General; M. Manohar Reddy
Page 5 of 52
SRSJ
W.P.Nos. 17021 of 2022
and batch
41. W.P.17475 OF 2022
Kollipara Sridevi v. The State of Andhra Pradesh and others
42. W.P.18531 OF 2022
Ganapathiraju Jogi Jaganadha Raju v. The State of Andhra
Pradesh and others
43. W.P.18532 OF 2022
MVHS Srinivas Reddy v. The State of Andhra Pradesh and
others
44. W.P.18541 OF 2022
Kandrapu Srirama Chandra Murthy v. The State of Andhra
Pradesh and others
45. W.P.18556 OF 2022
Madulla Naga Omkara v. The State of Andhra Pradesh and
others
46. W.P.18568 OF 2022
Karri Sarada Krishna Kapil v. The State of Andhra Pradesh
and others
Counsel for the petitioner/s : Sri T. Nagarjuna Reddy
Counsel for respondents : GP for Municipal Administration
and Urban Development; Advocate
General; M. Manohar Reddy
47. W.P.19214 OF 2022
G.V.V. Subrahmanyam v. The State of Andhra Pradesh and
others
48. W.P.19224 OF 2022
Devarapalli Krishna v. The State of Andhra Pradesh and
others
49. W.P.20112 OF 2022
D. Prudhvi Raj v. The State of Andhra Pradesh and others
50. W.P.20138 OF 2022
D. Prudhvi Raj v. The State of Andhra Pradesh and others
Page 6 of 52
SRSJ
W.P.Nos. 17021 of 2022
and batch
51. W.P.20149 OF 2022
M. Vasantha Kumar v. The State of Andhra Pradesh and
others
Counsel for the petitioner/s : Sri K. Jyothi Prasad
Counsel for respondents : GP for Municipal Administration
and Urban Development; Advocate
General; M. Manohar Reddy
52. W.P.41504 of 2022
Tata Sanyasi Raju v. The State of Andhra Pradesh and others
Counsel for the petitioner/s : Sri K. Sairam Murthy
Counsel for respondents : GP for Municipal Administration
and Urban Development; Advocate
General; M. Manohar Reddy
53. W.P.5638 of 2023
Kallepalli Suseela and others v. The State of Andhra Pradesh
and others
Counsel for the petitioner/s : Sri Pamarthi Kameswara Rao
Counsel for respondents : GP for Municipal Administration
and Urban Development; Advocate
General; M. Manohar Reddy
COMMON ORDER
Since the issue involved in these writ petitions is one and the same, they are disposed of by this common order.
2. The above writ petitions are filed impugning the action of respondents in screening off the building permissions without issuing any notice or there being any order, as illegal, arbitrary and violation of Rule 26 of the Andhra Pradesh Page 7 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch Building Rules, 2017 (for short 'the Rules'), violation of principles of natural justice and Articles 14, 19 and 300-A of the Constitution of India.
3. a) The averments germane to decide the issue are as follows: The writ petitioners are bonafide purchasers/ transferees, having purchased TDRs from the registered owners. Pursuant to the purchase of TDRs from the respective owners they applied for sanction of building permissions. The Urban Local bodies/authorities granted permission to construct structure upon considering TDR bonds, as per the Rules in vogue.
b) The Commissioner of Tanuku Municipality (hereinafter referred to as Commissioner) awarded 17 TDR bonds in relation to land of an extent of Ac.18-55 cents, in R.S.Nos.226(P), 227(P), 228(P), 232(P) 233(P), 234(P) and 235(P) of Tanuku, earmarked, for purpose of parks/garden in the Master Plan of Tanuku Municipality, approved by the Government vide G.O.Ms.No.480 M.A., dated 19.09.2000, at 1:400% ratio in favour of respective owners. The Commissioner also awarded TDR bonds, 12 in number at 1:400% ratio, for an extent of Ac.9-36 cents, in R.S.Nos.759/2, 761/5, 761/3, 761/4, 764/2 to 6, 9 and 10 Page 8 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch (Parts), 792/1F2a1(P), 762/1B, 792/1F1(P), 764/6, 10(P), 792 1F1(P), 1F2a2(P) of Tanuku, earmarked for compost yard with buffer 100 meters all around the compost yard as per the draft master plan approved by the Government vide G.O.Ms.No.204 dated 08.10.2014, in favour of respective land owners.
c) The petitioners, as stated supra, purchased the TDRs from the respective owners and applied for building permission. The permissions were sanctioned as per the Rules. As far as the stage of construction is concerned, in some cases, the construction is yet to commence, in three or four writ petitions the construction is completed and in some writ petitions, construction is going on.
d) The petitioners are bonafide purchasers of TDR bonds from respective owners. In fact, purchase of TDRs by the petitioners was acknowledged by the respondent authorities. The writ petitioners have spent valuable consideration to purchase TDRs for construction of additional floors/set backs, as per the Rules. While so, the respondent authorities unilaterally blocked the visibility of TDRs on their DPMS website and interface portal without any notice. Hence, the writ petitions.
Page 9 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch
4. a) Preliminary counter affidavit was filed on behalf on behalf of respondent No.1 and later additional counter affidavit was filed. While it was not disputed regarding issuance of TDRs in respect of Ac.18-55 cents and Ac.09-36 cents of lands which are earmarked for parks/garden and compost yard respectively to the owners of the properties, it was contended, inter alia, that the Commissioner issued TDR in 1:400% ratio against the ratio of 1:200%. The Commissioner mentioned the value per square yard, by mentioning D.Nos.10-13-7 and D.No.1-14-15/6, which are at a distance of 1.40 KM, and hence, it resulted in abnormal increase of value of property and consequentially caused abnormal increase in value of TDR bonds.
b) The Commissioner/authority without obtaining prior permission as per G.O.Ms.No.180 M.A. dated 01.12.2020, issued TDRs. Therefore, the Government vide G.O.Ms.No.195 MA&UD dated 04.04.2022, appointed A. Prabahakara Rao, CCP, GVMC, to conduct enquiry. Enquiry Officer enquired and submitted report vide ROC No.1/CCP/ Peshi/2022 dated 10.05.2022, wherein it was stated that the entire process has been done by Urban Local Body within a day or days in a hurried manner. All 29 TDR bonds were Page 10 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch issued to a couple of families only and benefitted them by escalating the cost of TDR bonds. Thereafter, respondent No.1/ Government issued memo vide No.5930037/Vig.III/ 2022 dated 03.06.2022, entrusting the matter to the Director General of ACB, Vijayawada, with a direction to conduct regular enquiry/investigation regarding the irregularities committed in issuance of TDR bonds and to submit detail report, within a period of three months. After noticing the irregularities committed by the Commissioner, the Government has placed the Commissioner, Tanuku Municipality, the then T.P.O. and TPS under suspension as per Rule 8(1)(a) of the APCS (CC&A) Rules, 1991.
c) The TDRs issued by the Commissioner were kept in abeyance temporarily and necessary action will be taken immediately upon receipt of the report from the Director General, ACB, Vijayawada. The building applications, under scrutiny, are also kept in abeyance to detach the TDR bonds attached to certain applications. At the request of some of the individuals, the building applications were released by duly detaching the TDR bonds. The balance applications, which are under dispute, are also under consideration. The Page 11 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch petitioners are not entitled to secure benefit flowing out of illegality.
5. a) In the additional counter filed on behalf of respondent No.1, it was contended, inter alia, that the benefit or reward secured by way of fraud in public law or under public authority unravels every such benefit or reward. No equity on law or the facts, be claimable by a recipient of grant or benefit or reward, as a result of fraud or mis- representation, having regard to the benefits, which are prima facie, found to have been conferred on individual owners as windfall to cause personal gain disproportionate entitlement contemplated under the statutory rules. The respondent No.1, by exercising power under Article 387-A of Andhra Pradesh Municipalities Act, 1965 (for short 'the Municipalities Act') issued oral direction to respondent No.2, not to act upon TDR certificates issued in respect of subject lands including the applications filed by subsequent transferees or owners thereof, for permissions to utilize the TDR. Such owners or transferees who have already secured permissions were also prohibited from proceeding further and such of those applications which have been filed seeking permission to utilize TDRs were also kept in abeyance without processing. Page 12 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch
b) The Enquiry Officer proceeded to give its findings which are tentative subject to an opportunity to be provided to the owners and subsequent transferees as to how the entitlement is far more than statutory Rules, etc. The Door number was deliberately shown by the owners in the gift deeds/TDR bonds to enrich themselves. The owners or the transferees have no right in law or in equity to continue to claim the benefit of fraudulent secured TDR. The writ petitioners are entitled to an opportunity to show cause before the final decision, and the arrangement made is tentative. Each owner or transferee would be issued a show cause notice detailing the extent of fraud, the actual entitlement & the windfall and decision will be taken in accordance with law on consideration of replies. Eventually, prayed to dismiss the writ petitions.
6. Separate preliminary affidavit was filed on behalf of Directorate of Town and Country Planning Govt of A.P., reiterating the averments in the counter affidavit filed by respondent No.1.
7. Heard Sri Unnam Muralidhar, learned Senior Counsel assisted by Sri Satyanarayana, learned counsel; Sri P.Veera Reddy learned Senior Counsel assisted by T.Nagarjuna Page 13 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch Reddy, learned counsel; Sri N.Aswani Kumar, learned counsel; Sri K.Jyothi Prasad, learned counsel; K. Sairam Murthy, learned counsel and Sri Pamarthi Kameswara Rao, learned counsel for the petitioners and learned Advocate General, appearing for the respondents.
8. Learned Senior Counsels and counsels appearing for the petitioners, while reiterating the contentions as per the averments made in the writ affidavits, drew the attention of the Court to the objective in issuance of TDRs and would further contend that the act of the respondents, in screening the permissions, is violative of principles of natural justice, since no notice was issued to the petitioners. The respondents/State cannot go back on its sovereign set of promises by violating the Principles of Legitimate Expectation. In fact, such an act is hit by Doctrine of Promissory estoppel. The petitioners being bonafide, purchasers cannot be made to suffer, and the State has to honor the building permissions. Since the property was acquired, and the State authorities issued TDR bonds as per the Rules, the State is vicariously liable for any misdeeds done by its authority. The revocation of building permission is only available to the State under Rule 26 of the Andhra Page 14 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch Pradesh Building Rules, 2017 (for short 'the Rules') and in the absence of any contradiction or violation, the authority cannot keep the permissions in abeyance.
9. Learned Advocate General, on the other hand, would contend that the Commissioner and two other officers committed fraud resulting in issuance of TDR certificates to the respective owners. He would submit that without obtaining permission from the competent authority, the Commissioner issued TDRs enhancing the ratio as well as the market value. He also would submit that fraud unravels every action in private or public law. Learned Advocate General would fairly submit that an enquiry will be conducted at the level of Government itself, by issuing notices to the owners as well as subsequent purchasers and necessary orders will be passed by following due process. He would submit that the enquiry will be completed within a period of three months. He would submit that beneficiary of fraud cannot maintain a Writ under Article 226 of the Constitution of India, to continue benefit under the said fraud which would amount to perpetuate of illegality.
10. In view of the above contentions the following points arise for consideration:
Page 15 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch
1. Whether screening off or keeping abeyance of building permissions, granted in favour of the petitioners, without issuance of notice is violative of Principles of Natural Justice?
2. Whether the Commissioner of Tanuku Municipality, followed the procedure mandated under the A.P. Municipalities Act and G.O.Ms.No. 119 dated 28.03.2017 as amended by G.O.Ms.No.180 dated 01.12.2020, while issuing TDR bonds in respect of land of an extent of 18-55 cents and Ac.9-36 cents?
3. Whether the act of respondents in screening the building permissions is hit by the principle of estoppel and the State is vicariously liable for the act done of its officials?
11. Learned Senior Counsel for the petitioners' placed reliance on the following decisions rendered by the High Courts and Hon'ble Apex Court.
TDR bond is Negotiable, and it is to be treated like immovable property:
12. Sadoday Builders Pvt. Ltd. Vs. The Joint Charity Commissioner and others1, wherein, the Bombay High Court, after considering various judgments held that:
"... benefit arising from the land is immovable property. FSI/TDR being a benefit arising from the land, consequently must be held to be immovable property. And an agreement for use of TDR consequently can be specifically enforced."1
MANU/MH/0791/2001 Page 16 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch
13. Chheda Housing Development Corporation v. Bibi Jan Shaikh Farid2, wherein the Bombay High Court held as under:
"Slum TDR is not interest on the owners property. It is FSI of some other land which is transferable in terms of DC regulations. TDR may be owned by the holder but not the land from which TDR was generated."
14. Janhit manch v. State of Maharashtra3, wherein the Hon'ble Apex Court held as under:
"... TDR or DRC is negotiable and can be transferred for consideration leaving it open for the owner of the acquired land to either use the TDR for himself or sell it in the open market."
15. Tukaram Kana Joshi & Others vs. Maharashtra Industrial Development Corporation & others4, wherein the Hon'ble Apex Court held as under:
9. The right to property is now considered to be not only a constitutional or a statutory right but also a human right.
Though, it is not a basic feature of the Constitution or a fundamental right. Human rights are considered to be in realm of individual rights, such as the right to health, the right to livelihood, the right to shelter and employment, etc. Now however, human rights are gaining an even greater multifaceted dimension. The right to property is considered very much to be a part of such new dimension.
10. In the case at hand, there has been no acquisition. The question that emerges for consideration is whether, in a democratic body polity, which is supposedly governed by the rule of law, the State should be allowed to deprive 2 (2007) 3 Mah LJ 402 3 (2019) 2 SCC 505 4 (2013) 1 SCC 353 Page 17 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch a citizen of his property, without adhering to the law. The matter would have been different had the State pleaded that it has right, title and interest over the said land. It however, concedes to the right, title and interest of the appellants over such land and pleads the doctrine of delay and laches as grounds for the dismissal of the petition/appeal.
11. ... There is a distinction, a true and concrete distinction, between the principle of "eminent domain"
and "police power" of the State. Under certain circumstances, the police power of the State may be used temporarily, to take possession of property..
12. The State, especially a welfare State which is governed by the rule of law, cannot arrogate itself to a status beyond one that is provided by the Constitution. Our Constitution is an organic and flexible one. ..... There is another facet. The Court is required to exercise judicial discretion. The said discretion is dependent on facts and circumstances of the cases. .... That apart, if the whole thing shocks the judicial conscience, then the Court should exercise the discretion more so, when no third- party interest is involved..."
16. Chairman Indore Vikas Pradhikaran Vs. Pure Industrial Coke & Chemicals Ltd. & Others5, wherein the Hon'ble Apex Court held as under:
55. Earlier human rights existed to the claim of individuals right to health, right to livelihood, right to shelter and employment, etc. but now human rights have started gaining a multifaceted approach. Now property rights are also incorporated within the definition of human rights. Even claim of adverse possession has to be read in consonance with human rights. As President John Adams (1797-1801) put it:
"Property is surely a right of mankind as real as liberty."
Adding, 5 (2007) 8 SCC 705 Page 18 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch "The moment the idea is admitted into society that property is not as sacred as the laws of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence."
56. Property, while ceasing to be a fundamental right would, however, be given express recognition as a legal right, provisions being made that no person shall be deprived of his property save in accordance with law.....The statutory scheme contemplates that a person and owner of land should not ordinarily be deprived from the user thereof by way of reservation or designation.
58. Expropriatory legislation, as is well-known, must be given a strict construction.
Principles of Natural Justice:
17. State of U.P. v. Sudhir Kumar Singh and Ors.6, wherein the Hon'ble Apex Court, after considering a number of authorities summed up as follows:
"... An analysis of the aforesaid judgments thus reveals:
1. Natural justice is a flexible tool in the hands of the judiciary to reach out in fit cases to remedy injustice. The breach of the audi alteram partem rule cannot by itself, without more, lead to the conclusion that prejudice is thereby caused.
2. Where procedural and/or substantive provisions of law embody the principles of natural justice, their infraction per se does not lead to invalidity of the orders passed. Here again, prejudice must be caused to the litigant, except in the case of a mandatory provision of law which is conceived not only in individual interest, but also in public interest.
3. No prejudice is caused to the person complaining of the breach of natural justice where such person does not dispute the case against him or it. This can happen by 6 (2020) SCC OnLine SC 847 Page 19 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch reason of estoppel, acquiescence, waiver and by way of non-challenge or non-denial or admission of facts, in cases in which the Court finds on facts that no real prejudice can therefore be said to have been caused to the person complaining of the breach of natural justice.
4. In cases where facts can be stated to be admitted or indisputable, and only one conclusion is possible, the Court does not pass futile orders of setting aside or remand when there is, in fact, no prejudice caused. This conclusion must be drawn by the Court on an appraisal of the facts of a case, and not by the authority who denies natural justice to a person.
The "prejudice" exception must be more than a mere apprehension or even a reasonable suspicion of a litigant. It should exist as a matter of fact, or be based upon a definite inference of likelihood of prejudice flowing from the non-observance of natural justice." Promissory Estoppel:
18. State of Orissa and others Vs. Mangalam Timber Products Limited7, wherein the Hon'ble Apex Court, while considering the applicability of 'Doctrine of Promissory Estoppel', held as under:
... to attract the applicability of principle of Estoppel it is not necessary that there must be a contract in writing. ... State cannot take advantage of its own omission. The State Government having persuaded the respondent to establish an industry and the respondent having acted on the solemn promise of the State Government, purchased the raw material at a fixed price... The State Government cannot be permitted to revise the terms for supply of raw material adversely to the interest of the respondent and effective from a back date and place the respondent in a situation which it will not be able to revolve." (emphasis is mine) 7 (2004) 1 SCC 139 Page 20 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch
19. Amrit Banaspati Co. Ltd and another Vs. State of Punjab8, wherein the Hon'ble Apex Court held as under:
"... basic ingredients of promise by the Government, belief of the appellant that it was true and if acted upon shall entitle it to refund of sale Tax and finally altering its position by investing substantial amount were thus established to invoke Promissory Estoppel against the Government".
20. Learned counsel also placed reliance upon M/s Motilal Padampat Sugar Mills Co.Ltd vs State of Uttar Pradesh and others9.
Vicarious liability of the State:
21. N. Nagendra Rao & Co v. State of A.P.10, wherein the Hon'ble Apex Court held as under:
24. In the modern sense the distinction between sovereign or non-sovereign power thus does not exist. It all depends on the nature of power and manner of its exercise. Legislative supremacy under the Constitution arises out of constitutional provisions. The legislature is free to legislate on topics and subjects carved out for it. Similarly, the executive is free to implement and administer the law. A law made by a legislature may be bad or may be ultra vires, but since it is an exercise of legislative power, a person affected by it may challenge its validity, but he cannot approach a court of law for negligence in making the law. Nor can the Government in exercise of its executive action be sued for its decision on political or policy matters. It is in the public interest that for acts performed by the State either in its legislative or executive capacity it should not be answerable in torts. That would be illogical and impractical. It would be in conflict with even modern notions of sovereignty. One of the tests to determine if the legislative or executive function 8 (1992) 2 SCC 411 9 (1979) 2 SCC 409 10 (1994) 6 SCC 205 Page 21 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch is sovereign in nature is whether the State is answerable for such actions in courts of law. For instance, acts such as defence of the country, raising armed forces and maintaining it, making peace or war, foreign affairs, power to acquire and retain territory, are functions which are indicative of external sovereignty and are political in nature.
Therefore, they are not amenable to jurisdiction of ordinary civil court. No suit under the Civil Procedure Code would lie in respect of it. The State is immune from being sued, as the jurisdiction of the courts in such matter is impliedly barred.
25. But there the immunity ends. No civilised system can permit an executive to play with the people of its country and claim that it is entitled to act in any manner as it is sovereign. The concept of public interest has changed with structural change in society. No legal or political system today can place the State above law as it is unjust and unfair for a citizen to be deprived of his property illegally by the negligent act of officers of the State without any remedy. From sincerity, efficiency and dignity of State as a juristic person, propounded in nineteenth century as sound sociological basis for State immunity the circle has gone round and the emphasis now is more on liberty, equality and the rule of law. The modern social thinking of progressive societies and the judicial approach is to do away with archaic State protection and place the State or the Government on a par with any other juristic legal entity. Any watertight compartmentalization of the functions of the State as "sovereign and non-sovereign" or "governmental and non-governmental" is not sound. It is contrary to modern jurisprudential thinking. The need of the State to have extraordinary powers cannot be doubted. But with the conceptual change of statutory power being statutory duty for sake of society and the people the claim of a common man or ordinary citizen cannot be thrown out merely because it was done by an officer of the State even though it was against law and negligent. Needs of the State, duty of its officials and right of the citizens are required to be reconciled so that the rule of law in a Welfare State is not shaken. Even in America where this doctrine of sovereignty found its place either because of the "financial instability of the infant American States rather than to the stability of the doctrine's theoretical foundation", or because of "logical and practical ground", or that "there could be no legal right as against the State which made the law" gradually gave way to the movement from, "State irresponsibility to State responsibility". In Welfare State, functions of the State are not only defence of the country or administration of justice or maintaining law and order, but it extends to regulating and controlling the activities of people in almost every sphere, educational, commercial, social, economic, political Page 22 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch and even marital. The demarcating line between sovereign and non-sovereign powers for which no rational basis survives has largely disappeared. Therefore, barring functions such as administration of justice, maintenance of law and order and repression of crime etc. which are among the primary and inalienable functions of a constitutional Government, the State cannot claim any immunity. The determination of vicarious liability of the State being linked with negligence of its officers, if they can be sued personally for which there is no dearth of authority and the law of misfeasance in discharge of public duty having marched ahead, there is no rationale for the proposition that even if the officer is liable the State cannot be sued. The liability of the officer personally was not doubted even in Viscount Canterbury [1 PH 306 : 41 ER 648] . But the Crown was held immune on doctrine of sovereign immunity. Since the doctrine has become outdated and sovereignty now vests in the people, the State cannot claim any immunity and if a suit is maintainable against the officer personally, then there is no reason to hold that it would not be maintainable against the State.
Ratio of TDR:
22. Municipal Corporation of Greater Bombay v.
Yeswanth Jaganath Vaity11, wherein the Hon'ble Supreme Court held as under:
"On compromise terms landowners voluntarily surrendering their lands in lieu of TDR's, subsequently executive authority cannot act in derogation of applicable regulations, write a letter reducing the quantum of such TDR's contrary to the regulations is held to be impermissible."
23. Rajhan Narendra Rout vs State of Maharastra and Others12, wherein the Hon'ble Apex Court held as under:
"27. In view of the above, we are of the opinion that gross injustice has been caused to the appellants who had offered their land to the respondent No. 3/Corporation 11 (2011) 11 SCC 88 12 (2022) SCC OnLine SC 1081 Page 23 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch on the basis of a Scheme floated by it proposing to acquire land for public purpose and grant TDR to the landowners in lieu of the land. Having decided to award TDR @ 100% FSI to the appellants, later on the respondents reneged from their decision and slashed the offered TDR to 4% FSI on the premise that the appellants could not compare their land with the adjoining lands for claiming residential use since the said land is also in the nature of 'Hill Top/Hill Slope'."
28. In the said circumstances, we had proposed the following two solutions to the respondents for settling the matter once and for all:
(a) to grant Transferable Development Right Certificate (TDRC) to the petitioner as was given to the petitioner on 28-5-2004; or
(b) to acquire the land and pay compensation to the petitioner in accordance with the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2003.
31. Having considered the factual matrix of the present appeal where the matter has been lingering in courts for over eighteen years and there have been several rounds of litigation, three before the High Court and two before this Court in respect of the subject land, which has all along remained in the possession of the respondent No. 3/Corporation, thereby not only depriving the appellants of its use but also depriving them of the compensation to which they were entitled as long back as in the year 2004, we are unable to concur with the impugned judgment. In ordinary course, we would have been inclined to restore the TDR granted to the appellants by the respondent No. 3/Corporation on 28th May, 2004. However, keeping in mind the submission made by learned counsel for the respondent Nos. 3 and 4/Corporation that extensive construction has mushroomed in Pune over the past two decades and additional construction of over seven lakhs sq. feet, if permitted, will cause a severe strain on the civic amenities available in the city, it is deemed appropriate to direct the respondent Nos. 3 and 4/Corporation to return the land acquired by it to the appellants within four weeks. Once the possession is restored, the appellants shall be permitted to use it for residential purposes. Page 24 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch Oral instructions
24. T.S.R.Subramanian and Ors vs Union of India and Ors13, wherein the Hon'ble Apex Court held as under:
"37. We have extensively referred to the recommendations of the Hota Committee, 2004 and Santhanam Committee Report and those reports have highlighted the necessity of recording instructions and directions by public servants. We notice that much of the deterioration of the standards of probity and accountability with the civil servants is due to the political influence or persons purporting to represent those who are in authority. Santhanam Committee on Prevention of Corruption, 1962 has recommended that there should be a system of keeping some sort of records in such situations. Rule 3(3)(iii) of the All India Service Rules specifically requires that all orders from superior officers shall ordinarily be in writing. Where in exceptional circumstances, action has to be taken on the basis of oral directions, it is mandatory for the officer superior to confirm the same in writing. The civil servant, in turn, who has received such information, is required to seek confirmation of the directions in writing as early as possible and it is the duty of the officer superior to confirm the direction in writing.
38. We are of the view that the civil servants cannot function on the basis of verbal or oral instructions, orders, suggestions, proposals, etc. and they must also be protected against wrongful and arbitrary pressure exerted by the administrative superiors, political executive, business and other vested interests. Further, civil servants shall also not have any vested interests. Resultantly, there must be some records to demonstrate how the civil servant has acted, if the decision is not his, but if he is acting on the oral directions, instructions, he should record such directions in the file. If the civil servant is acting on oral directions or dictation of anybody, he will be taking a risk, because he cannot later take up the stand, the decision was in fact not his own. Recording of instructions, directions is, therefore, necessary for 13 (2013) 15 SCC 732 Page 25 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch fixing responsibility and ensure accountability in the functioning of civil servants and to uphold institutional integrity." (emphasis is mine)
25. Learned Advocate General placed reliance on the following decisions:
Fraud:
26. Commissioner of Customs, Kandla vs. Essar Oil ltd. & Ors.14, wherein the Hon'ble Apex Court held that:
"29. By "fraud" is meant an intention to deceive; whether it is from any expectation of advantage to the party himself or from ill will towards the other is immaterial. The expression "fraud" involves two elements, deceit and injury to the person deceived. Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable, or of money and it will include any harm whatever caused to any person in body, mind, reputation or such others. In short, it is a non-economic or non-pecuniary loss. A benefit or advantage to the deceiver, will almost always call loss or detriment to the deceived. Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied. [See Vimla (Dr.) v. Delhi Admn. [1963 Supp (2) SCR 585 : (1963) 2 Cri LJ 434] and Indian Bank v. Satyam Fibres (India) (P) Ltd. [(1996) 5 SCC 550]
30. A "fraud" is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to gain by another's loss. It is a cheating intended to get an advantage. (See S.P. Chengalvaraya Naidu v. Jagannath [(1994) 1 SCC 1] .)
31. "Fraud" as is well known vitiates every solemn act. Fraud and justice never dwell together. Fraud is a conduct either by letter or words, which includes the other person or authority to take a definite 14 (2004) 11 SCC 364 Page 26 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch determinative stand as a response to the conduct of the former either by words or letter. It is also well settled that misrepresentation itself amounts to fraud. Indeed, innocent misrepresentation may also give reason to claim relief against fraud. A fraudulent misrepresentation is called deceit and consists in leading a man into damage by wilfully or recklessly causing him to believe and act on falsehood. It is a fraud in law if a party makes representations, which he knows to be false, and injury enures therefrom although the motive from which the representations proceeded may not have been bad. An act of fraud on court is always viewed seriously. A collusion or conspiracy with a view to deprive the rights of the others in relation to a property would render the transaction void ab initio.
Fraud and deception are synonymous. Although in a given case a deception may not amount to fraud, fraud is anathema to all equitable principles and any affair tainted with fraud cannot be perpetuated or saved by the application of any equitable doctrine including res judicata. (See Ram Chandra Singh v. Savitri Devi [(2003) 8 SCC 319] .)
32. "Fraud" and collusion vitiate even the most solemn proceedings in any civilised system of jurisprudence. It is a concept descriptive of human conduct. Michael Levi likens a fraudster to Milton's sorcerer, Comus, who exulted in his ability to "wing me into the easy-hearted man and trap him into snares". It has been defined as an act of trickery or deceit. In Webster's Third New International Dictionary "fraud" in equity has been defined as an act or omission to act or concealment by which one person obtains an advantage against conscience over another or which equity or public policy forbids as being prejudicial to another. In Black's Legal Dictionary, "fraud" is defined as an intentional perversion of truth for the purpose of inducing another in reliance upon it to part with some valuable thing belonging to him or surrender a legal right; a false representation of a matter of fact whether by words or by conduct, by false or misleading allegations, or by concealment of that which should have been disclosed, which deceives and is intended to deceive another so that he shall act upon it to his legal injury. In Concise Oxford Dictionary, it has been defined as criminal deception, use of false representation to gain unjust advantage; dishonest artifice or trick. According to Halsbury's Laws of England, a representation is deemed to have been false, and therefore a misrepresentation, if it was at the material date false in substance and in fact. Section 17 of the Indian Contract Act, 1872 defines Page 27 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch "fraud" as act committed by a party to a contract with intent to deceive another. From dictionary meaning or even otherwise, fraud arises out of deliberate active role of the representator about a fact, which he knows to be untrue yet he succeeds in misleading the representee by making him believe it to be true. The representation to become fraudulent must be of a fact with knowledge that it was false. In a leading English case i.e. Derry v. Peek [(1886-90) All ER Rep 1 : (1889) 14 AC 337 : 58 LJ Ch 864 : 61 LT 265 (HL)] what constitutes "fraud" was described thus (All ER p. 22 B-C):
"[F]raud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false."
But "fraud" in public law is not the same as "fraud" in private law. Nor can the ingredients, which establish "fraud" in commercial transaction, be of assistance in determining fraud in administrative law. It has been aptly observed by Lord Bridge in Khawaja v. Secy. of State for Home Deptt. [(1983) 1 All ER 765 : 1984 AC 74 : (1982) 1 WLR 948 (HL)] , that it is dangerous to introduce maxims of common law as to effect of fraud while determining fraud in relation to statutory law.
"Fraud" in relation to statute must be a colourable transaction to evade the provisions of a statute.
"If a statute has been passed for some one particular purpose, a court of law will not countenance any attempt which may be made to extend the operation of the Act to something else which is quite foreign to its object and beyond its scope.' Present-day concept of fraud on statute has veered round abuse of power or mala fide exercise of power. It may arise due to overstepping the limits of power or defeating the provision of statute by adopting subterfuge or the power may be exercised for extraneous or irrelevant considerations. The colour of fraud in public law or administrative law, as it is developing, is assuming different shades. It arises from a deception committed by disclosure of incorrect facts knowingly and deliberately to invoke exercise of power and procure an order from an authority or tribunal. It must result in exercise of jurisdiction which otherwise would not have been exercised. That is misrepresentation must be in relation to the conditions provided in a section on existence or non-existence of which power can be exercised. But non-disclosure of a fact not required by a statute to be disclosed may not amount to fraud. Even Page 28 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch in commercial transactions non-disclosure of every fact does not vitiate the agreement. 'In a contract every person must look for himself and ensures that he acquires the information necessary to avoid bad bargain.' In public law the duty is not to deceive."
33. 'Fraud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false'.
27. Bhaurao Dagdu Paralkar vs. State of Maharashtra & Ors.15, is also relied upon in that regard. Principles of Natural Justice:
28. Automotive Tyre Manufacturers Association Vs. Designated Authority & Ors16, wherein the Hon'ble Apex Court held as under:
81. Undoubtedly, there can be exceptions to the said doctrine. As stated above, the question whether the principle has to be applied or not is to be considered bearing in mind the express language and the basic scheme of the provision conferring the power; the nature of the power conferred and the purpose for which the power is conferred and the final effect of the exercise of that power. It is only upon a consideration of these matters that the question of application of the said principle can be properly determined. (See Union of India v. Col. J.N. Sinha [(1970) 2 SCC 458] .)
29. State of Maharashtra & ors Vs. Jalgaon Municipal Council & ors17, wherein the Hon'ble Apex Court held as under:
15
(2005) 7 SCC 605 16 (2011) 2 SCC 258 17 (2003) 9 SCC 731 Page 29 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch
30. It is a fundamental principle of fair hearing incorporated in the doctrine of natural justice and as a rule of universal obligation that all administrative acts or decisions affecting rights of individuals must comply with the principles of natural justice and the person or persons sought to be affected adversely must be afforded not only an opportunity of hearing but a fair opportunity of hearing. The State must act fairly just the same as anyone else legitimately expected to do and where the State action fails to satisfy the test it is liable to be struck down by the courts in exercise of their judicial review jurisdiction. However, warns Prof. H.W.R. Wade that the principle is flexible:
"The Judges, anxious as always to preserve some freedom of manoeuvre, emphasise that 'it is not possible to lay down rigid rules as to when the principles of natural justice are to apply: nor as to their scope and extent. Everything depends on the subject-matter'. Their application, resting as it does upon statutory implication, must always be in conformity with the scheme of the Act and with the subject-matter of the case. 'In the application of the concept of fair play there must be real flexibility.' There must also have been some real prejudice to the complainant: there is no such thing as a merely technical infringement of natural justice."
30. In Russell v. Duke of Norfolk18, it was held as under:
"The requirements of natural justice must depend on the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject-matter that is being dealt with, and so forth."
31. State of Chattisgarh & Ors. Vs. Dhirjo Kumar Sengar19, wherein the Hon'ble Apex Court held as under:
17. It is in the aforementioned premise, the contention in regard to the breach of audi alteram partem doctrine must be considered. The principle of natural justice although is required to be complied with, it, as is well known, has exceptions.18
[(1949) 1 All ER 109 (CA)] 19 (2009) 13 SCC 600 Page 30 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch (See Banaras Hindu University v. Shrikant [(2006) 11 SCC 42 : (2007) 1 SCC (L&S) 327] .) One of the exceptions has also been laid down in S.L. Kapoor v. Jagmohan [(1980) 4 SCC 379 : AIR 1981 SC 136] wherein it was held: (SCC p. 395, para 24) "24. ... In our view the principles of natural justice know of no exclusionary rule dependent on whether it would have made any difference if natural justice had been observed. The non- observance of natural justice is itself prejudice to any man and proof of prejudice independently of proof of denial of natural justice is unnecessary. It ill comes from a person who has denied justice that the person who has been denied justice is not prejudiced. As we said earlier where on the admitted or indisputable facts only one conclusion is possible and under the law only one penalty is permissible, the court may not issue its writ to compel the observance of natural justice, not because it is not necessary to observe natural justice but because courts do not issue futile writs."
18. ...
19. The respondent keeping in view the constitutional scheme has not only committed a fraud on the Department but also committed a fraud on the Constitution. As commission of fraud by him has categorically been proved, in our opinion, the principles of natural justice were not required to be complied with.
21. In these cases, requirement to comply with the principles of natural justice has been emphasised. The legal principles carved out therein are unexceptional. But, in this case, we are concerned with a case of fraud. Fraud, as is well known, vitiates all solemn acts. The High Court, therefore, must be held to have committed a serious error in passing the impugned judgment.
32. Learned Advocate General also relied upon Aligarh Muslim University and Ors. Vs. Mansoor Ali Khan20 and 20 (2000) 7 SCC 529 Page 31 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch contended that violation of principles of natural justice per se is not a ground to interfere unless the petitioners show that such violation caused prejudice. The Hon'ble Apex Court, considered prejudice test qua violation of natural justice and observed that there is no absolute rule, and prejudice must be shown depending on the facts of each case, held as follows:
24. The principle that in addition to breach of natural justice, prejudice must also be proved has been developed in several cases. In K.L. Tripathi v. SBI [K.L. Tripathi v. SBI, (1984) 1 SCC 43 : 1984 SCC (L&S) 62] Sabyasachi Mukharji, J. (as he then was) also laid down the principle that not mere violation of natural justice but de facto prejudice (other than non-
issue of notice) had to be proved. ..."
33. K.L. Tripathi v. State Bank of India21, the Hon'ble Apex Court held as under:
29. We are of the opinion that Mr Garg is right that the rules of natural justice as we have set out hereinbefore implied an opportunity to the delinquent officer to give evidence in respect of the charges or to deny the charges against him.
Secondly, he submitted that even if the rules had no statutory force and even if the party had bound himself by the contract, as he had accepted the Staff Rule, there cannot be any contract with a Statutory Corporation which is violative of the principles of natural justice in matters of domestic enquiry involving termination of service of an employee. We are in agreement with the basic submission of Mr Garg in this respect, but we find that the relevant rules which we have set out hereinbefore have been complied with even if the 21 (1984) 1 SCC 43 Page 32 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch rules are read that requirements of natural justice were implied in the said rules or even if such basic principles of natural justice were implied, there has been no violation of the principles of natural justice in respect of the order passed in this case. In respect of an order involving adverse or penal consequences against an officer or an employee of Statutory Corporations like the State Bank of India, there must be an investigation into the charges consistent with the requirements of the situation in accordance with the principles of natural justice as far as these were applicable to a particular situation. So whether a particular principle of natural justice has been violated or not has to be judged in the background of the nature of charges, the nature of the investigation conducted in the background of any statutory or relevant rules governing such enquiries. Here the infraction of the natural justice complained of was that he was not given an opportunity to rebut the materials gathered in his absence. As has been observed in On Justice by J.R. Lucas, the principles of natural justice basically, if we may say so, emanate from the actual phrase "audi alteram partem" which was first formulated by St. Augustine (De Duabus Animabus, XIV, 22 J.P. Migne, PL. 42, 110)." ANALYSIS BY COURT
34. Keeping in view, the ratio in the judgements relied upon by the counsels for the petitioners as well as the learned Advocate General, this court intends to consider awarding of TDR bonds and the violation of principles of natural justice in the first instance.
35. Chapter XII of the Rules, which deals with Transferable Development Rights, reads thus:
166. of the Rules defines Transferable Development Rights Page 33 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch An award specifying the built up area an owner of a site or plot can sell or dispose or utilize elsewhere, whose site or plot is required to be set apart or affected for a community amenity or development for public purpose in the Master Plan or in road widening or covered in recreational use zone etc. The award would be in the form of a TDR Certificate issued by the Competent Authority.
36. A perusal of the definition makes it clear that an award specifying built up area, whose site is affected for specified purpose, in lieu of compensation, Transferable Development Rights will be issued. The Transferable Development Rights will be awarded only when such lands are transferred to the local body/development authority by way of registered gift deed.
37. Grant of TDR will be considered by the competent or sanctioning authority, in respect of areas mentioned in sub- rule (2) of Rule 168. The aspect as to whether ratio is to be awarded at 1:100%, 1:200% or 1:400% will depend upon norms mentioned in clauses (a) to (e) of Sub-Rule (2) of Rule
168. Sub-Rule (3) of Rule 168 prescribes as to how the TDR will be arrived at.
38. The TDR may be arrived at, on the basis of relative land value and equivalent amount in both export and import areas, as per the Registration Department records, at the time of utilization. The Competent Authority shall have the discretion in Page 34 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch the matter of applicability of TDR. The TDR shall not be allowed in unauthorized buildings/structures/constructions and shall be considered only after the land is vested with the Local Authority / Development Authority. The TDR certificate issued can be permitted to utilize/dispose for construction of additional built-up area in any ULB/UDA/CRDA (except capital city) as per guidelines and conditions prescribed by Competent Authority.
39. Sub-Rule 3 was substituted by way of amendment as per G.O.Ms.No. 223 dated 09.07.2018. The significant change, as per the substituted provision, is that the TDR certificate issued can be permitted to utilize/dispose of for construction of additional built-up area in any ULB/UDA/CRDA (except capital city) as per the guidelines and conditions prescribed. All the transactions i.e. issuance, utilization and transfer of TDRs shall be online. Explicit bar is imposed qua manual transactions. As per the Rule 170 of the Rules the applicant must submit documents along with application for grant of TDRs. Further Clauses 8 and 9 make it clear the applicant has to submit the land value of the site where TDR is to be availed and TDR admissible in terms of Sq.m and equivalent land value.
40. Below is the tabular form referring to the particulars of original ownership of the land, purchase of land by applicants Page 35 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch either by registered agreements of sale cum general power of attorney or sale deeds and making application to TDR and issuance of TDR in favour of applicants.
GARDEN
Date of Application
Name of Date of
Name of RS Exten Date of Gift Date of TDR
Original Purchase / TDR date
Applicant No. t Deed Endorsement No
Owner AGPA
Manual Web Portal
Nekkanti
Krishna VV
YVV Kishore, 226/8 0.80
Satyanarayan 10.03.2021 17.03.2021 20.03.2021 24.03.2021 25.02.2021 26.03.2021 00016
YVV Ramesh B cts
a, S/o
Paparao
00027
Nekkanti
Krishna VV
Nunna Sita 0.75
Satyanarayan 234/8 14.07.2021 04.08.2021 09.08.2021 31.08.2021 08.09.2021 30.09.2021
Mahalaxmi cts
a, S/o
Paparao
Nekkanti
Sridevi, W/o
Mutyala 1.43
NKVV 235/2 31.08.2021 01.04.2021 14.04.2021 16.04.2021 16.04.2021 00017
Sandhya Rani cts
Satyanarayan
a
Katuri Ram
Prasad, S/o 1.40
235/4 19.04.2021 24.04.2021 29.04.2021 30.04.2021 06.05.2021 06.05.2021 00018
Laxmana cts
Rao
Katuri Ram
Bandaru Kota Prasad, S/o 0.81
235/3 29.07.2021 04.08.2021 09.08.2021 19.08.2021 26.08.2021 27.08.2021 00024
Nageswararao Laxmana 1/2
Rao
233/5
Mutyala Katuri
B2,23
Ramakrishna Laxmana
3/6,
Rao, Bodapati Rao, S/o
233/3 1.85
Santoshidevi, Venkata 10.05.2021 15.05.2021 24.05.2021 31.05.2021 07.06.2021 07.06.2021 00020
A1, 1/2
Yedlapalli Ramakrishna
233/5
Jaganmohan Prasad
A1,23
Rao Chowdary
5/3
226/1
Katuri
B,
Laxmana
226/2
Rao, S/o
B, 0.73
Venkata 10.05.2021 15.05.2021 24.05.2021 31.05.2021 07.06.2021 07.06.2021 00021
227/4 1/2
Ramakrishna
C,
Prasad
227/5
Chowdary
C
Page 36 of 52
SRSJ
W.P.Nos. 17021 of 2022
and batch
Katuri
Laxmana
234/4
Nune Rao, S/o
B2, 0.70
Satyanarayan Venkata 12.07.2021 04.08.2021 09.08.2021 27.09.2021 29.09.2021 01.10.2021 00028
234/4 cts
a Ramakrishna
C
Prasad
Chowdary
Katuri Satya 235/1
Mutyala
Sri, W/o A, 0.89
Venkata 31.07.2021 04.08.2021 09.08.2021 31.08.2021 08.09.2021 30.09.2021 00026
P.Sankara 234/6, cts
Narayana
Dutt 234/7
Katuri Vijaya
Venkata
0.87
Laxmi, W/o 226/9 25.11.2021 02.12.2021 24.12.2021 31.12.2021 03.01.2022 04.01.2022 00032
cts
Laxmana
Rao
Chundru Katuri Vijaya
Prasada Venkata
226/8 0.80
Venkata Laxmi, W/o 19.07.2022 04.08.2021 09.08.2021 31.12.2021 17.02.2022 17.02.2022 00037
A, 8B cts
Sitarama Laxmana
Murthy Rao
Prabha
Chundru Chandra, W/o 226/8 1.00
23.08.2021 05.02.2022 15.02.2022 17.02.2022 17.02.2022 00038
Rajeswari Katuri Ram A, 8B cts
Prasad
Mutyala Nunna Durga 1.08
233/6 01.05.2021 05.05.2021 13.05.2021 20.05.2021 01.06.2021 01.06.2021 00019
Nageswararao Prasad cts
235/1
Mutyala A,
Satyanarayan 235/1 1.85
14.06.2021,
a, Mutyala Nunna Durga B, cts, 29.06.2021,
26.06.2021, 12.07.2021 22.07.2021 24.07.2021 24.07.2021 00022
Ratnam, W/o Prasad 234/2 0.04 16.07.2021
30.06.2021
Satyanarayan A, cts
a 234/2
B
234/1
Gunnam Balusu B1A, 1.25
07.08.2021 13.08.2021 21.08.2021 21.08.2021 26.08.2021 27.08.2021 00023
Venkatarao Annapurna 234/1 cts
B1B
Gunnam Tammina 0.72
234/3 28.07.2021 04.08.2021 09.08.2021 27.09.2021 29.09.2021 01.10.2021 00029
Venkatalaxmi Nagamani cts
234/4
Mutyala Vijaya Chilukuri A, 0.71
28.07.2021 04.08.2021 09.08.2021 31.12.2021 03.01.2022 04.01.2022 00031
Prasad Ramalaxmi 234/4 cts
B1
Page 37 of 52
SRSJ
W.P.Nos. 17021 of 2022
and batch
COMPOST YARD
Name of Name of RS No. Extent Date of Date of Gift Date of Application Date of TDR date TDR
Original Applicant Purchase / Deed Endorseme No
Owner AGPA nt
Manual Web Portal
Adabala Palapu 762/1B 0.33 cts 03.11.2021, 29.12.2021 06.01.2022 29.01.2022 01.02.2022 02.02.2022 00033
Kirankumar Anilkumar, 24.11.2021
S/o Srinu
Adabala Palapu 764/2, 0.98 cts 17.01.2022 01.02.2022 05.02.2022 08.02.2022 08.02.2022 00034
Kirankumar Anilkumar, 3, 4, 5,
S/o Srinu 6, 9,
10(P)
Burugupalli Palapu 759/2 1.00 cts 14.02.2022 15.02.2022 18.02.2022 23.02.2022 25.02.2022 00039
Trimurthulu Anilkumar,
S/o Srinu
Kavuru Palapu 792/1F 0.70 cts 21.02.2022 23.02.2022 08.03.2022 08.03.2022 10.03.2022 00046
Srinivasa Anilkumar, 1,
Rao, Kavuru S/o Srinu 792/1F
Soma Sai 2B
Pavan
Adabala Palapu 764/1 1.00 cts 04.02.2022 07.02.2022 14.02.2022 15.02.2022 15.02.2022 00035
Kirankumar Srinu, S/o
Suryanaray
ana
Burugupalli Palapu 759/2 1.09 cts 14.02.2022 15.02.2022 18.02.2022 23.02.2022 25.02.2022 00040
Vijaya Sri Srinu, S/o
Suryanaray
ana
Kavuru Palapu 792/1F 0.71 cts 21.02.2022 23.02.2022 08.03.2022 09.03.2022 10.03.2022 00045
Bhaskara Srinu, S/o 1,
Sitaratnam Suryanaray 792/1F
ana 2A2
Adabala Palapu 761/4A 0.38 cts 04.02.2022 07.02.2022 14.02.2022 15.02.2022 15.02.2022 00036
Kirankumar Lavanya,
W/o
Anilkumar
Adabala Palapu 764/6, 0.50 cts 22.02.2022 25.02.2022 07.03.2022 09.03.2022 10.03.2022 00044
Kirankumar, Lavanya, 10
GPA of W/o
Sanaboina Anilkumar
Gopi
Kavuru Palapu 792/1F 0.90 cts 21.02.2022 25.02.2022 08.03.2022 09.03.2022 10.03.2022 00047
Govindarajul Akkamamb 2A1
u a, W/o Srinu 792/1F
3
Mutyala Gunnam 761/15 0.91 cts 14.02.2022 15.02.2022 04.03.2022 04.03.2022 05.03.2022 00042
Srivalli Ananthalax P
Ratnamaniky mi
am
Page 38 of 52
SRSJ
W.P.Nos. 17021 of 2022
and batch
Mutyala Rayya 761/3 0.86 cts 14.02.2022 15.02.2022 04.03.2022 04.03.2022 05.03.2022 00043
Srivalli Laxminaray
Ratnamaniky ana
am
41. An extent of Ac.18-55 cents in R.S.No. 226(P), 227(P), 228(P), 232(P), 233(P), 234(P), and 235(P) of Municipality was approved for parks (garden) in the Master Plan of Tanuku vide G.O.Ms.No.480 MA dated 19.09.2000. (Emphasis is mine)
42. An extent of Ac.9-36 centts in R.S.No. 759/2, 761/5, 761/3, 761/4, 764/2,3,4,5,6,9,10 (parts), 792/1F2a1(P), 762/1B, 792/1F1(P), 764/6,10(P), 792/1F1(P), 1F2a2(P) of Tanuku was earmarked for compost yard with buffer 100 mts all round the compost yard as per draft master plan approved by the Government vide G.O.Ms.No. 204, M.A. dated 08.10.2014. (Emphasis is mine)
43. Vendors of the petitioners and others purchased the lands for which TDRs were issued mostly under registered agreements of sale cum general power of attorney as indicated in the tabular sheet referred to supra.
44. Immediately, vendors of the petitioners and others executed registered gift deeds in favour of the Municipality on Page 39 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch the dates mentioned in the Tabular sheet and the authorities issued TDRs.
45. While issuing TDRs, for the land surrendered by the petitioners' vendors and others, the authority mentioned door Nos. 10-13-7 and D.No.1-14-15/6 and issued TDRs at 1:400%, by mentioning the value related to said door numbers. This court is not going to adjudicate the validity or otherwise of mentioning of door numbers in view of the reasons mentioned infra.
46. In respect of land for garden use, the door number mentioned is 1-14-15/6 and the value mentioned is Rs.10,000/- per Sq.yard. In respect of land for compost yard the door number mentioned is 10-13-7 and the value mentioned is Rs.22,000/- per Sq.yard.
47. All the petitioners, undisputedly, purchased TDRs from the respective owners based on the availability from web portal maintained by Development Permission Management System. As per the scheme mentioned supra, every transaction shall be online. Thus, without much elaboration, prima facie, the petitioners can be termed as bona fide purchasers TDRs for valuable consideration. Page 40 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch
48. It is also an undisputed fact that based upon purchase of TDRs, the petitioners submitted respective applications to the authorities for grant of building permissions except one individual. In some cases, permission was granted, and construction of buildings was completed, and, in some cases, construction is under process and in some cases, permission is under process.
49. In the additional counter affidavit of respondent No.1, it was specifically contended about the alleged fraud played by its officers, petitioners' vendors and other owners/applicants. Necessary material was also filed.
50. In fact, it was specifically averred that the findings of the enquiry officer are tentative subject to an opportunity to be provided to the owners and the subsequent transferees as to how the entitlement is far in excess of the statutory rules etc.
51. It is pertinent to note here that Additional Counter Affidavit was filed by Special Chief Secretary to Government of Municipal Administration and Urban Development Department, Government of Andhra Pradesh in October 2022. Notwithstanding the averment made in the addl. counter affidavit, qua an opportunity to the respective Page 41 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch landowners and subsequent purchasers, it is very unfortunate that no steps have been initiated, so far, in that regard. However, this court records the statement made by learned Advocate General that such an enquiry will be completed within a period of three months.
52. When an alleged irregularity or fraud is surfaced and Government itself issued oral instructions to keep the benefit out of the alleged fraud, in abeyance, the authority should have completed the enquiry by issuing notices to the landowners as well as subsequent purchasers without waiting for this long period. The government should have kept in mind the plight of a bona fide purchaser for valuable consideration (TDR) and stalling of construction as a result of blocking visibility of building permits or TDRs from the website.
53. In fact, Transferable Development Right bond is to be treated as immovable property and hence any violation in that regard to be treated as violation of Article 300A of the Constitution of India. In all the batch of writ petitions, all the petitioners are subsequent purchasers. None of their respective vendors are arrayed as party respondents. Page 42 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch
54. The cases at hand as pointed out surpa, park and compost yard were notified in the year 2000 and 2014 respectively as per the Master Plan and Draft Master Plan. In respect of awarding TDRs qua the land around compost yard the Commissioner, Tanuku Municipality addressed letter to the Director of Town and Country Planning vide Rc.No.1076/2021/G1 dated 01.01.2022. Even before obtaining permission from the authority, the Commissioner issued TDRs in favour of the respective landowners as indicated in the tabular sheet.
55. In this connection, the contention of learned Advocate General that after purchase of lands by vendors of the petitioners and others either by way of registered Agreements of Sale cum General power of Attorney or Sale deeds, as mentioned in the tabular sheet, the things moved swiftly even without any intimation by the local authority needs to be considered during enquiry proposed. TDRs were awarded to the applicants without being issued notices by the local body. There was no intimation from the local authority about the acquisition of land or affecting the land for the purpose as per master plan or draft master plan either to the vendors of the petitioners or their predecessors in interest. It seems learned Page 43 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch Advocate General advanced such an argument based on observation in the enquiry report, wherein it was observed that TDR bonds were issued, the applicants executed registered gift deeds in favour of ULB prior to submission of applications, without any intimation from the local body.
56. A copy of the enquiry report was handed over to the learned counsels appearing for the petitioners.
57. Of course, this court is not recording any finding, at this stage, as to whether any fraud was committed by the authorities and vendors of petitioners and others in awarding TDRs in favour of vendors of the petitioners and others. Any finding by this court, at this juncture, in the considered opinion of this court, may cause prejudice either to the vendors of the petitioners and others or the Government. It is also not fair on the part of this court to adjudicate the issue in the absence of vendors of the petitioners and any finding is against doctrine of fair play. Any finding or observation in this order will not come in the way of the authority, in conducting enquiry in relation to alleged fraud of issuance of TDRs referred to supra. The findings, if any, are recorded for the purpose of disposal of this writ petition only and will not bind the authority.
Page 44 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch
58. With regard to the contention of the leaned counsels appearing for petitioners that awarding of TDR bonds at 1:400% is permissible in favour of the vendors of the petitioners and others, this court is not going into said aspect at this point of time. The contention of the learned Advocate General that vendors of the petitioners and others are entitled to ratio at 1:100% or 1:200% only is also not addressed at this juncture in the absence of vendors of the petitioners and other TDRs holders. Likewise, the contention of the learned Advocate General about the mentioning of door numbers and thereby enhancing the value resulting in windfall at Rs. 691.43 crores as per counter) to the vendors of the petitioners and others than the actual entitlement is also not addressed since those aspects, according to this court need to be decided during the enquiry proposed. None of the vendors of petitioners and other TDR awardees are made party respondents or petitioners to the writ petitioners. Though it was contended that the petitioners being subsequent transferees/bona fide purchasers, canvassed the cause of their vendors, unless the vendors of the petitioners and other awardees of other TDR holders are made party respondent this court cannot persuade with the said argument. The Page 45 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch petitioners should have impleaded the respective owners as party respondents at least, subsequent to, filing of additional counter affidavit. In the absence of vendors of the petitioners and other TDR holders, as parties to the writ petitions, any adjudication or finding by this court, qua their entitlement, without hearing the affecting parties, is impermissible and such an attempt is against audi alteram partem.
59. It is also pertinent to mention here that a case in Cr.No. 02/RCO-EWG/2023 on the file of P.S.ACB, Eluru Range, Eluru was registered against the then Commissioner of Tanuku Municipality, Assistant City Planner, Town Planning Supervisor and others under Sections 13(2) R/w 13(1)(a) of P.C.(Amendment) Act 2018 and Secs 409, 420, 120(B), 34 of Indian Penal Code.
60. Regarding the violation of principles of natural justice, the contention of the learned senior counsels and counsels appearing for the petitioners, at first breadth, appears to be sound, in view of the fact, that none of the petitioners were issued prior notice. All the petitioners purchased bonds based on availability of bonds in Development Permission Management System. The said portal is under the control of the Government. Thus, petitioners being the subsequent Page 46 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch transferees/bonafide purchasers for valuable consideration, before keeping the building permissions in abeyance, should have been issued with notices about the alleged fraud. However, without issuing notices, keeping the permissions in abeyance, abruptly, would amount to violation of principles of natural justice. Whether the violation by the authorities, would the petitioners entail the Mandamus sought for. In the facts of this case, the answer is emphatic no.
61. The concept of natural justice can neither be put in a straitjacket nor is a general principle of universal application. In case of commission of fraud, principles of natural justice are not required to be complied with.
62. The observations of the Hon'ble Apex Court made in State of Maharastra and Others v. Jalgoan Municipal Council and others,22, which are relevant are extracted here with.
32. The caution of associating rules of natural justice with the flavour of flexibilities would not permit the courts applying different standards of procedural justice in different cases depending on the whims or personal philosophy of the decision-maker. The basic principles remain the same; they are to be moulded in their application to suit the peculiar situations of a given case, for the variety and complexity of situations defies narration. That is flexibility. Some of the 22 (2003) 9 SCC 731 Page 47 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch relevant factors which enter the judicial process of thinking for determining the extent of moulding the nature and scope of fair hearing and may reach to the extent of right to hearing being excluded are: (i) the nature of the subject-matter, and (ii) exceptional situations. Such exceptionality may be spelled out by (i) the need to take urgent action for safeguarding public health or safety or public interest, (ii) the absence of legitimate expectation, (iii) by refusal of remedies in discretion, (iv) doctrine of pleasure such as the power to dismiss an employee at pleasure, and (v) express legislation. There is also a situation which Prof. Wade and Forsyth term as "dubious doctrine" that right to a fair hearing may stand excluded where the court forms an opinion that a hearing would make no difference. Utter caution is needed before bringing the last exception into play.
63. Though it was contended by the learned Advocate General that the petitioners failed to establish prejudice suffered by them qua the alleged violation of principles of natural justice, in the opinion of the this curt, the petitioners being subsequent transferees should have been put on notice before keeping the permissions in abeyance (screening off). The petitioners, having purchased TDR bonds oblivious of the alleged fraud, are now put to prejudice i.e. keeping permissions in abeyance. However, in the facts and circumstances of this case, especially the pela of fraud alleged and filing of relevant material along with additional counter, non-observation of principles of natural justice would not vitiate the act of respondent authority. Page 48 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch
64. In view of the discussion supra and in the facts and circumstances of this case, oral instruction by the government to respondent No.2 not to act upon the TDRs, issued in respect of subject lands and the consequences there of, cannot be found fault with at this stage. At the same time this court is not closing avenues available to the writ petitioners being subsequent purchasers from their respective vendors, as per law.
65. Learned Advocate General pointed out that some of the writ petitioners i.e. petitioners in W.P.Nos.18092, 18102, 21739, 18122, 20530 and 21794 of 2022, in view of the developments i.e. keeping the validity of those bonds in abeyance, detached those bonds and purchased bonds from other owners and proceeded with. The said fact was not controverted by the learned counsels appearing for the petitioners.
66. Sri N. Ashwani Kumar learned counsel appearing for petitioners in some of the writ petitions, would submit that the petitioners are aggregable for an enquiry as suggested by the learned Advocate General.
Page 49 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch
67. Thus, in view of the discussion supra, this court is not going into other aspects i.e. doctrine of estoppel and vicarious liability. The other contention of the learned counsels for the petitioners that only 10% of the total allotted TDRs were only purchased and hence no prejudice will be caused to the respondent authorities if the petitioners proceed further, this court is not persuaded with the said submission. It depends upon the enquiry and its result.
68. For instance, in W.P.No.18532 of 2022 the TDR allotted to the petitioner's vendor vide No. 1081/00021/ TDR/ VA/2021 is 11,897.36 Sq.mtrs. Out of the said extent, writ petitioner purchased 5126.51 Sq.mtrs. In W.P.No. 20149 of 2022, it was averred that petitioner therein purchased 5,341.68 Sq.Mrts under TDR No. 1081/00033/TDR/ KP/2021(total extent of TDR). Of course, in some other cases lesser extent of TDRs were purchased. Keeping the same in mind, at this stage it is unsafe to conclude about the prejudice and percentage so put forth.
69. In view of the discussion supra, the writ petitions are disposed of, keeping in view the stand point of petitioners, being subsequent purchasers and stalling of their projects for nearly two years, directing the 1st respondent, as per the oral Page 50 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch undertaking of learned Advocate General, to complete the enquiry by issuing notices to both the awardees of TDRs and petitioners relating to TDRs in Tanuku Municipality (29 numbers), within a period two months from today by adhering to the procedure. Since more than two years elapsed from the date of initiation of action by respondent the State, this court makes it clear that no further time will be granted or extended regarding enquiry proposed by learned Advocate General being undertaken at the Government level. In fact, a copy of the enquiry report is made available to the counsels for the petitioners. It is not out of place to mention here that the awardees of TDRs and subsequent purchasers shall co- operate with the enquiry for expeditious completion. No costs.
I.A.No.2 of 2022 in W.P.Nos.17475, 18531, 19214, 19224, 18568, 18556, 18532 and 18541 of 2022 are filed to implead respective vendors as party respondents. However, the same is not brought to the Court's notice, during the course of arguments. This Court noticed the same at the time of signing the order.
Page 51 of 52
SRSJ W.P.Nos. 17021 of 2022 and batch In view of disposal of the writ petitions, I.A.No.2 of 2022 in W.P.Nos.17475, 18531, 19214, 19224, 18568, 18556 18532 and 18541 of 2022 are closed.
As a sequel, pending miscellaneous petitions, if any, shall stand closed.
________________________________ JUSTICE SUBBA REDDY SATTI Date: 19.03.2024 ikn Page 52 of 52 SRSJ W.P.Nos. 17021 of 2022 and batch HONOURABLE SRI JUSTICE SUBBA REDDY SATTI WRIT PETITION Nos. 17021, 17024, 17046, 17048, 17280, 17302, 17304, 17306, 17307, 17308, 17309, 17321, 17342, 17756, 17773, 17788, 17791, 17794, 17822, 17851, 17852, 17853; 18031, 18064, 18069, 18073, 18088, 18091, 18092, 18097, 18102, 18105, 18108, 18122, 20530, 21738, 21739, 21773, 21774, 21794; 17475, 18531, 18532, 18541, 18556, 18568; 19214, 19224, 20112, 20138, 20149; 41504 of 2022 and 5638 of 2023 Date: 19.03.2024 ikn