Karnataka High Court
Kanthi Resorts Pvt Ltd vs The State Of Karnataka on 20 February, 2026
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WP No. 105642 of 2023
HC-KAR
IN THE HIGH COURT OF KARNATAKA, AT DHARWAD
DATED THIS THE 20TH DAY OF FEBRUARY 2026
BEFORE
THE HON'BLE MRS JUSTICE K.S.HEMALEKHA
WRIT PETITION NO. 105642 OF 2023 (LA-KIADB)
BETWEEN:
KANTHI RESORTS PVT. LTD.,
(A COMPANY REGISTERED UNDER
THE COMPANIES ACT, 1956),
CORPORATE OFFICE AT SHASHISHEKHAR,
163A/2A, WARD NO.10,
OPP. LIONS SCHOOL, BAGALKOTE-587101,
BY ITS DIRECTOR, GIRISH R. KANTHI.
...PETITIONER
(BY SRI. HARSH DESAI, ADVOCATE)
AND:
1. THE STATE OF KARNATAKA
VISHAL BY ITS SECRETARY TO THE COMMERCE
NINGAPPA AND INDUSTRIES DEPARTMENT,
PATTIHAL VIKASA SOUDHA, DR. AMBEDKAR VEEDHI,
Digitally signed by VISHAL
BENGALURU-560001.
NINGAPPA PATTIHAL
Location: HIGH COURT OF
KARNATAKA DHARWAD
BENCH 2. THE SPECIAL LAND ACQUISITION OFFICER,
Date: 2026.03.06 11:46:06
+0530 KIADB DHARWAD, DHARWAD-580001.
3. THE EXECUTIVE MEMBER,
KIADB DHARWAD, DHARWAD-580001.
4. THE DEPUTY COMMISSIONER
BAGALKOT DISTRICT, NAVANAGAR,
BAGALKOTE-587103.
5. KAMALABAI W/O. ANNARAO @ ANNAJI DESAI
77 YEARS, GADDANAKERI,
BAGALAKOTE-587103.
6. SONABAI W/O. KISHOR KULKARNI
56 YEARS, GADDANAKERI,
BAGALAKOTE-587103.
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WP No. 105642 of 2023
HC-KAR
7. VENKATESH S/O. ANNARAO @ ANNAJI DESAI
53 YEARS, GADDANAKERI,
BAGALAKOTE-587103.
8. SHAKUNTALA W/O. RAGHU DESAI
49 YEARS, GADDANAKERI,
BAGALAKOTE-587103.
9. REKHA W/O. SHRINIVAS DANDIN
46 YEARS, GADDANAKERI,
BAGALAKOTE-587103.
10. PRALHAD S/O. ANNARAO @ ANNAJI DESAI
44 YEARS, GADDANAKERI,
BAGALAKOTE-587103.
...RESPONDENTS
(BY SRI. PRAVEEN K.UPPAR, AGA FOR R1 AND R2;
SRI. G.I.GACHCHINAMATH, ADVOCATE FOR R3 AND R4;
SRI. F.V.PATIL, ADVOCATE FOR SRI. NANDISH PATIL AND
SRI. RAMACHANDRA V.BHAT, ADVOCATES FOR R5 TO R10)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
OF THE CONSTITUTION OF INDIA 1950, PRAYING TO ISSUE A WRIT
OF CERTIORARI QUASHING THE ACQUISITION NOTIFICATIONS
BEARING NO. VAAKRU.32.SPQ.2003 DATED 20-03-2003 (ANNEXURE-
B) AND BEARING NO. VAAKRU.601.SPQ.2004 DATED 12-01-2005
(ANNEXURE-C) IN SO FAR AS THEY RELATE TO LAND MEASURING 1
ACRE 38 GUNTAS IN SY.NO.109/28 SITUATE AT GADDANAKERI
VILLAGE IN BAGALKOTE TALUK AND DISTRICT BY RESPONDENT NO.2
AND CONSEQUENTLY ALSO QUASH THE AWARD BEARING
NO.KRAKIADB/BHUSWA/BAA/889/09-10 DATED 26-09-2009 PASSED
BY RESPONDENT-2 (ANNEXURE-E) AND THE JUDGMENT AND AWARD
DATED 02-04-2019 PASSED BY THE COURT OF THE II ADDITIONAL
SENIOR CIVIL JUDGE AT BAGALKOTE IN LAC NO.8 OF 2018
(ANNEXURE-G); AND ETC.
THIS WRIT PETITION COMING ON FOR ORDERS THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: THE HON'BLE MRS JUSTICE K.S.HEMALEKHA
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WP No. 105642 of 2023
HC-KAR
ORAL ORDER
The petitioner-company, Kanthi Resorts Pvt. Ltd. has approached this Court seeking;
i) quashing of the acquisition notification dated 20.03.2003 and 12.01.2005 insofar as they relate to Sy.No.109/28 measuring 1 acre 38 guntas in Gaddanakeri village, Bagalkot taluk and district,
ii) quashing of the award dated 26.09.2009 and the judgment and award dated 02.04.2019 passed in L.A.C.No.8/2018 and
iii) quashing of consequential demand notices issued by Karnataka Industrial Areas Development Board (KIADB) calling upon the petitioner to deposit amounts towards enhanced compensation and allied charges together with consequential relief.
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR Brief facts:
2. The petitioner-company had approached Karnataka Udyog Mitra (KUM) with a proposal for establishment of a tourism resort project. The KUM approved the proposal and recommended acquisition of lands through KIADB for implementation of the project.
Pursuant thereto, the State issued preliminary and final acquisition notifications dated 20.03.2003 and 12.01.2005. The possession of the acquired lands were handed over through KIADB and the petitioner has set up a Resort Project and has been in enjoyment of the acquired lands since then.
3. An award came to be passed on 26.09.2009. Thereafter, at the instance of private respondents (legal representatives/respondent Nos.5 to 10), reference proceedings were pursued, culminating in reference Court's judgment and award dated 02.04.2019 in L.A.C.No.8/2018, enhancing compensation.
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4. Aggrieved by the enhanced compensation, KIADB filed M.F.A.No.104474/2019, before the Division Bench, wherein the quantum of compensation awarded by the Reference Court, which is pending consideration. Interim directions regarding deposit of portion of the enhanced compensation is stated to have been issued in the said appeal.
5. Consequent upon such proceedings, KIADB issued demand notices calling upon the petitioner-Company (as allottee of acquisition) to deposit the amounts towards the enhanced compensation and allied charges. The petitioner has filed this writ petition and among the other grounds, has stated that the possession of the land has handed over in 2005, the extent of 1 acre 38 guntas in Sy.No.109/28 remained unutilized and vacant. Subsequently, the petitioner has filed I.A.No.1/2026 seeking to place an additional statement on record, and now pleads that the land in Sy.No.109/28 has been utilized and a three-storied building has been constructed. -6-
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6. Learned counsel for the petitioner submits that the land in Sy.No.109/28, is in fact a Government land(vested land) and that respondent No.5 to 10 have no lawful right or entitlement to claim compensation in respect of such land. It is contended that one Annarao (original land holder), never participated in the award proceedings and that he died on 06.05.2013. It is only thereafter, that the legal heirs (respondent Nos.5 to 10), initiated reference proceedings and obtained enhancement. It is contended that the petitioner-company was neither made a party to the L.A.C. proceedings nor the subsequent M.F.A. proceedings and therefore the enhancement proceedings have been taken place behind its back.
7. It is further contended that the declaration list does not specifically indicate the survey numbers in the manner now asserted and that Sy.No.109/28 was wrongly treated as a private land. It is contended that fraud has been played in projecting Sy.No.109/28 as a private property, though the land stood vested in the Government -7- NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR and not available for compensation to private individuals. It is contended that the fraud vitiates the very basis of entire entitlement and this Court can exercise writ jurisdiction notwithstanding the delay.
8. Learned counsel further submits that the KIADB cannot fasten liability upon the petitioner to deposit the enhanced compensation when the very entitlement of respondent Nos.5 to 10 is in serious dispute and when, according to the petitioner, the land stands vested in the State. It is further contended that the present writ petition became necessary only upon receipt of exorbitant demands and that the petitioner is entitled to protection against coercive recovery proceedings.
9. Per contra, learned counsel appearing for the State opposes the writ petition on the ground of maintainability and delay. It is contended that the acquisition is of the years 2003 and 2005. Award is of the year 2009 and the petitioner having accepted the -8- NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR acquisition and enjoyed the benefit thereof for nearly 2 decades cannot invoke writ jurisdiction to reopen acquisition proceedings at this belated stage. It is further contended that the writ petition is not a forum to decide complex disputed questions of title, vesting, particularly when civil- revenue remedies exist and when acquisitions have long since attained finality.
10. Learned counsel for respondent Nos.2 and 3 contends that the acquisition was initiated and completed for implementation of the petitioner's project. Possession was delivered, the petitioner has utilized the land and therefore petitioner cannot approbate and reprobate by challenging the acquisition and resisting the statutory consequence of payment of compensation. It is contended that the Reference Court has enhanced compensation and the appeal against the said award is pending in M.F.A.No.104474/2019. In such circumstances, the petitioner's attempt to assail the Reference Court's award in a writ petition is not maintainable, and at any rate, the -9- NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR petitioner ought to have pursued the appropriate remedy in accordance with law including seeking impleadment in the pending appeal.
11. Learned counsel further submits that the petitioner's own additional statement (I.A.No.1/2026) to submit that the petitioner's original plea that Sy.No.109/28 was vacant is now admitted to be incorrect and such inconsistent pleading disentitles the petitioner to equitable relief under Article 226 of the Constitution of India.
12. Learned counsel for respondent Nos.5 to 10 raise strong objections of inordinate delay and laches and contend that the writ petition, nearly filed 20 years after the acquisition proceedings and long after vesting, is liable to be dismissed on this ground alone. On locus, respondent Nos.5 to 10 contend that the petitioner is only an allottee under the KIADB framework and is neither the owner nor an "interested person", who is necessary party to the reference
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR proceedings. It is urged that the petitioner has no locus standi to maintain a writ petition to challenge either;
i) the acquisition in piecemeal or,
ii) the reference Court award, especially when the appeal against the award is already pending at the instance of KIADB.
13. It is further contended that the petitioner cannot challenge the acquisition notification only insofar as 1 acre 38 guntas while retaining the benefit of the remaining acquired lands (28 acres 17 guntas, as contended) and that such piecemeal challenge is impermissible.
14. Learned counsel contends that the revenue proceedings where the Government's name was entered, was deleted and the owner's name has been restored and that there is a specific reference that the land was self- cultivated and not tenanted and thereby disputing the petitioner's theory of vesting. In support of their contentions they relied upon the following decisions:
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR i. Peerappa Hanmantha Harijan (dead) by Lrs. And Others Vs. State of Karnataka and Another1 (Peerappa Hanmantha Harijan), to contend that a beneficiary/allottee under KIADB acquisition has limited locus and cannot maintain proceedings as if it were a land owner or necessary party to reference proceedings.
ii. Gregory Patrao and Others Vs. Mangalore Refinery and Petrochemicals Ltd. and Others2 (Gregory Patrao), to reinforce the limited role of beneficiary/allottee and the consequences of delay acquiescence and to contend that belated interference with concluded matters, attempts to avoid statutory obligations and are impermissible.1
AIR 2015 SC 2908 2 (2022) 10 SCC 461
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR iii. Shrachi Burdwan Developers Pvt. Ltd. Vs. The State of West Bengal and Others3 (Shrachi Burdwan), to contend that a writ petition under Article 226 by the company is not maintainable to challenge a reference award and that the statutory remedy is to appeal and writ is not the substitute for appeal.
iv. The Rajasthan State Industrial
Development and Investment
Corporation and Another Vs. Diamond and Gem Development Corporation Ltd. and Another4 (Rajasthan State Industrial Development and Investment Corporation), to contend that after accepting allotment/acquisition benefits, a company 3 Civil Appeal No.5856/2021 D.D 05.10.2021 4 AIR 2013 SCC 1241
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR cannot approbate and reprobate. Belated challenges are not entertainable.
15. This Court has carefully considered the rival submissions and perused the material on record. The point that arises for consideration is:
"Whether the petitioner-company being an allottee under KIADB acquisition and having accepted the possession and enjoyed the benefit of acquisition for nearly 2 decades can maintain the present writ petition to challenge the acquisition proceedings, the Reference Court award and the consequential demand notice on the grounds urged?"
16. The acquisition notifications are of the years 2003 and 2005, possession is stated to have been delivered in 2005, award is of 2009 and the petitioner has enjoyed the benefit of acquisition and project implementation for nearly two decades. The writ petition is filed in 2023 and is clearly vitiated by gross delay and laches. A writ Court, while exercising equitable and discretionary jurisdiction,
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR does not reopen concluded acquisition after prolonged acquiescence, particularly when third party rights and statutory finality have intervened and when the petitioner has himself enjoyed the fruits of acquisition. The petitioner, having accepted and utilized the acquisition, cannot now seek to invalidate it after merely 20 years.
17. The petitioner is not the original land owner. The acquisition land vests in the State under the KIADB framework and the allottee is essentially a beneficiary of the acquisition.
18. The respondents' contentions based on the decision in Peerappa Hanmantha Harijan that the beneficiary has limited locus and it is not to be treated as a necessary party to reference has substantial force.
19. The Apex Court in the case of Gregory Patrao has held at paragraph Nos.10 to 13, 16 and 19 under:
"10. The short question, which is posed for the consideration of this Court is, whether, Respondent
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR 1 MRPL, who is simply an allottee of the land by the KIAD Board, after the acquisition of the lands under Section 28 of the KIAD Act, 1966, which was for the benefit of Karnataka Industrial Areas Development Board ("KIADB") can be said to be a "person interested" under the provisions of the KIAD Act, 1966 and therefore, was a proper party in the reference proceedings initiated at the instance of the original landowners?
11. While answering the aforesaid issue/question, it is required to be noted that in the present case, the land has been acquired under the provisions of the KIAD Act, 1966 and the notification has been issued under Section 28(1) of the KIAD Act, 1966. The land has been acquired by the State Government for KIADB under three different notifications. After the lands were acquired, Respondent 1 MRPL has been allotted the lands acquired as per the agreements between the KIADB and MRPL. The present is not an acquisition under the provisions of the Land Acquisition Act and therefore, as such, neither Section 50 of the Land Acquisition Act, 1894 nor any other provisions of the Land Acquisition Act, 1894 shall be applicable with respect to the lands acquired under the provisions of the KIAD Act, 1966. Taking into consideration, the aforesaid
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR factual aspects, the impugned judgment and order passed by the High Court in which it has heavily relied upon the decisions of this Court in U.P. Awas Evam Vikas Parishad and Himalayan Tiles & Marble are required to be considered.
12. At the outset, it is required to be noted that as such, the issue involved in the present appeal in respect of the acquisitions under the KIAD Act, 1966 and the right of the subsequent allottee to participate in the reference proceedings and whether the subsequent allottee can be said to be a "person interested" under the provisions of the KIAD Act, 1966 is no longer res integra.
13. While deciding the acquisition under the very KIAD Act, 1966 and the right of the subsequent allottee, who has been allotted the land by the KIADB in Peerappa Hanmantha Harijan after distinguishing the decision of this Court in U.P. Awas Evam Vikas Parishad and Himalayan Tiles & Marble, it is specifically observed and held by this Court that an allottee company cannot be said to be a beneficiary or a "person interested" entitled for hearing before determination of compensation. By observing and holding so, this Court had an occasion to consider the entire scheme of acquisition under the KIAD Act, 1966 and has
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR distinguished the acquisition under the Land Acquisition Act, 1894. Before this Court also, the High Court remanded the matter at the instance of the allottee company in the writ petition filed by the allottee company to the Reference Court. This Court set aside the same while holding that the allottee company, who has been allotted the land under the provisions of the KIAD Act, 1966, can neither be said to be a beneficiary nor a "party interested"
entitled for hearing before determination of compensation.
16. This Court thereafter had considered the decisions in U.P. Awas Evam Vikas Parishad and Himalayan Tiles & Marble and has distinguished the same and has observed and held that the decisions in U.P. Awas Evam Vikas Parishad and Himalayan Tiles & Marble shall not be appliable with respect to the acquisition under the KIAD Act, 1966. Once, this Court in the subsequent decision in Peerappa Hanmantha Harijan dealt with and considered the earlier decisions in U.P. Awas EvamVikas Parishad and Himalayan Tiles & Marble and distinguished the same and observed and held with respect to the acquisition under the KIAD Act, 1966 that the allottee company can neither be said to be a "person interested" nor entitled for hearing before determination of
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR compensation, the said ratio was binding upon the High Court. Thus, it was not open for the High Court to not follow the binding decision of this Court in Peerappa Hanmantha Harijan by observing that in the subsequent decision in Peerappa Hanmantha Harijan, the earlier decisions in U.P. Awas Evam Vikas Parishad and Himalayan Tiles & Marble have not been considered. The High Court has not noted that as such while deciding the case of Peerappa Hanmantha Harijan , this Court did consider the earlier decisions in U.P. Awas Evam Vikas Parishad and Himalayan Tiles & Marble and had clearly distinguished the same. Not following the binding precedents of this Court by the High Court is contrary to Article 141 of the Constitution of India. Being a subsequent decision, in which the earlier decisions were considered and distinguished by this Court, the subsequent decision of this Court was binding upon the High Court and not the earlier decisions, which were distinguished by this Court.
19. We see no reason to take a different view than the view taken by this Court in Peerappa Hanmantha Harijan that MRPL being a subsequent allottee after the land was acquired by KIADB, can neither be said to be a beneficiary nor a "person interested" for the purpose of determination of compensation. Under the circumstances, the
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR impugned judgment and order passed by the High Court taking a contrary view is unsustainable and the same deserves to be quashed and set aside."
20. The Apex Court has held that a subsequent allottee after the land was acquired by KIADB can neither be said to be a beneficiary nor an "interested person", for the purpose of determination of compensation from therein.
21. The respondents' submission based on Shrachi Burdwan that the writ petition is not maintainable to challenge the reference, when statutory appeal remedy exists. It is relevant to note that the acquiring authority has already invoked the appellate jurisdiction, the petitioner having not impleaded itself in the pending M.F.A., cannot bypass the appellate mechanism by filing a writ petition.
22. When the statutory acquisition and award mechanism provide specific remedies and forums and when dispute pertains to compensation demand determined by a reference Court, the writ jurisdiction cannot be invoked by allottee as if it were an aggrieved land owner. The
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR petitioner's grievance is essentially against the liability to deposit and hence, compensation as demanded by KIADB, must be examined within the contours of statutory remedies and the pending appeal proceedings.
23. The acquisition, as a scheme and process, cannot be challenged in piecemeal by retaining benefits of the larger extent and disputing only a small portion (1 acre 38 guntas). When the entire project and allotment are found on the acquisition passage, a selective challenge, after long enjoyment is legally untenable and inequitable.
24. The petitioner has raised the issue that respondent Nos.5 to 10 have no title and the land is a vested with the Government. Learned counsel for respondent Nos.5 to 10, on the other hand, assert restoration of owner's name and self-cultivation status. These are undisputed and fact-intensive questions. In writ jurisdiction, particularly after a long delay and after conducting concluded acquisition, this Court is not to
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR conduct a roving enquiry into title or vesting. Even assuming that the petitioner seeks limited relief that "amount cannot be recovered from the petitioner", such relief is still intervened with statutory compensation processes, pending M.F.A. proceedings are fact finding on entitlement matters better left to the competent forum under the statute and the appellate Court presently seized of the issue.
25. The petitioner have approached KUM, acquisition was undertaken at its instance, possession was delivered, project was implemented, and structures were admittedly raised having accepted and acted upon the acquisition, the petitioner cannot now turn after 20 years and question the acquisition/award process to avoid consequences as rightly held by the respondents by relying upon the settled principles of law in the case of Rajasthan State Industrial Development and Investment Corporation's decision.
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26. In view of the above, this Court is of the considered view that the writ petition is barred by delay and laches. The petitioner being allottee has no locus standi to maintain a writ petition to quash the acquisition, reference award in the manner prayed. The challenge to the reference award is not maintainable in writ petition when statutory appeal exists and has already been invoked by the KIADB in M.F.A.No.104474/2019.
27. The petition suffers from inequitable conduct in view of the material inconsistency regarding utilization of Sy.No.109/28 and disputed questions of title are not amenable to adjudication in writ jurisdiction at this belated stage. For the foregoing reasons, the point framed for consideration is answered and this Court pass the following:
ORDER i. The writ petition stands dismissed.
ii. It is however made clear that:
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NC: 2026:KHC-D:2699 WP No. 105642 of 2023 HC-KAR a. The petitioner is at liberty to seek impleadment or appropriate relief in M.F.A.No.104474/2019, if permissible in law. b. All the contentions of title are kept open to be urged before the competent forum in accordance with law, if so, advised. iii. Interim orders, if any, stands vacated.
iv. No order as to cost.
Sd/-
JUSTICE K.S.HEMALEKHA
AT
Ct:VH
List No.: 1 Sl No.: 29