Judgment

GANGULY, J.

1. We have heard learned counsel for the parties including the learned senior counsel appearing for Chennai Metro Rail Limited. The Interlocutory Application Nos. 5-6 filed on behalf of the Chennai Metro Rail Limited for being impleaded are allowed.

2. The Commissioner, Municipal Corporation of Chennai is in appeal before us, impugning the judgment and order passed by the Division Bench of the Madras High Court dated 18.1.2005, whereby the learned Judges of the Division Bench affirmed the order of the learned Single Judge dated 24th September, 1999 on two writ petitions filed by the land owners who are respondent(s) herein. The facts leading to this case are that by notification dated 3rd January, 1949 an Award was passed by the Special Secretary for Land Acquisition, Madras in respect of the land which was acquired under the provisions of the Land Acquisition Act. It is not in dispute that reference proceedings were initiated in 1949 itself and upon getting the enhanced compensation, the land owners did not take the challenge any further. Under Section 16 of the Act, the land acquired, vested in the State in 1962, free from all encumbrances. Long thereafter, in 1995 representation was made by the respondent(s) herein for release/re-conveyance of a portion of the land which was acquired in 1949 inter alia on the ground that the appellant-Corporation was not utilising the same.

3. On such a representation, the Government by an Order dated 10th March, 1995 directed the appellant-Corporation to re-convey a portion of the lands measuring 5 grounds and 416 sq. ft. in R.S. No.324/2 to Thiruvalargal R. Neelakanta Mehta and R. Sivasankara Mehta and to their legal heirs or their nominees under ex-owner category, on collection of the compensation amount paid by the government for the acquisition of lands measuring 5 grounds and 416 sq. ft. in R.S. No. 324/2 with interest after completing all formalities. After the said order was passed, a representation was made by the appellant-Corporation to the Secretary, Government of Tamil Nadu, M.A. and W.S. Department to the effect that the said area can be better utilised for the purpose of parking of vehicles in view of manifold increase in traffic in that part of the city. A request was, therefore, made to stay the operation of the notification relating to reconveyance for consideration of the request of the Corporation.

4. Upon such representation from the appellant-Corporation, the Government of Tamil Nadu by an Order dated 25th July, 1995 cancelled the order of re-conveyance issued in G.O. Ms. No.45, M.A. & W.S. dated 10th March, 1995.

5. This order of 25th July, 1995 was impugned by the respondent(s) herein by filing two writ petitions. The learned Single Judge allowed the writ petitions inter alia on the ground that the Government is bound by provisions of promissory estoppel and also by reason of the fact that the order of cancellation of re-conveyance was passed without affording any opportunity of hearing to the land owners. The said decision of the learned Single Judge was challenged by the present appellant before the Division Bench of the High Court. The Division Bench of the High Court, in paragraph 17 of its judgment quoted from the judgment of the learned Single Judge and in paragraph 19 of the judgment quoted the provisions of Section 48-B which was introduced by Tamil Nadu Amendment Act, 1996 (Act 16 of 1996). Ultimately, the Division Bench held that the decision of the Government in rescinding its initial order of re-conveyance is bad. The Division Bench was not, therefore, inclined to interfere with the order passed by the learned Single Judge and dismissed the appeal of the Corporation and affirmed the decision of the learned Single Judge.

6. Assailing both these judgments, learned senior counsel for the appellant urged various contentions before us. The first question which was urged before us was that at the time when the exercise was made by the G