JUDGMENT

G.S. SINGHVI, J.

1. Whether negotiations between the landowners and the perceived beneficiaries of the reservation of land in the Development plan prepared under the Maharashtra Regional and Town Planning Act, 1966 (for short, ‘the Act’) can be treated as steps for the acquisition of land as contemplated under Section 127 of the Act is the question which arises for consideration in these appeals filed against order dated 29.4.2005/2.5.2005 passed by the Division Bench of the Bombay High Court in Writ Petition No.7846/2004 M/s. C.V. Shah and A.V. Bhat v. the State of Maharashtra and others, Writ Petition No.9644/2004 Tajuddin Mohhammadbhai Somaji and another v. the State of Maharashtra and others and Writ Petition No.5077/2004 Poona Timber Merchants and Saw Mill Owners Association v. the State of Maharashtra and others whereby it was declared that the reservation of land bearing Survey No.577 Hissa No.1, Survey No.577 Hissa No.2, Survey No. 577 Hissa No.3 and Survey No.578 Hissa No.1 (part) for ‘timber industries’ will be deemed to have lapsed because the land was not acquired within six months of the receipt of purchase notice.

2. In the revised Development plan of Pune City notified on 5.1.1987, the land in question was shown in the zone designated for ‘timber industries’. On 18.8.1988, M/s. C.V. Shah and A.V. Bhat entered into an agreement with the members of Timber Merchants Association (for short, ‘the Association’) for sale of the land owned by them and received a sum of Rs.35,37,500/- as earnest money. They also agreed to execute a tripartite agreement involving Pune Municipal Corporation (for short, ‘the Corporation’). After about three years, the landowners entered into another agreement dated 14.7.1991 for conveyance of the land in favour of the members of the Association either by inter vivos transaction or through acquisition procedure.

3. On 25.4.1989, the Standing Committee of the Corporation resolved to approve acquisition of the land in question and authorised the Municipal Commissioner to take steps for that purpose. Thereafter, letter dated 31.5.1989 was sent to Collector, Land Acquisition, Pune for issue of notification under Section 126(2) of the Act read with Section 6 of the Land Acquisition Act, 1894 (for short, ‘the 1894 Act’). However, no further step was taken by the Corporation or the State Government and the required notification was not issued.

4. On 23.9.1998, the advocate representing the Association got published notice in the newspaper ‘Prabhat’ in regard to purchase of the land in question. He also sent letter dated 8.10.1998 to Shri Kiran Kothadiya, advocate for M/s. C.V. Shah and A.V. Bhat on the same issue. The latter sent reply dated 5.3.1999 stating therein that the transaction cannot be finalised because the land was subject to Urban Land (Ceiling and Regulation) Act, 1976 (for short, ‘the 1976 Act’).

5. On 7.10.2000, M/s. C.V. Shah and A.V. Bhat and the Association executed deed and cancelled the agreements for sale dated 18.8.1988 and 14.7.1991. The relevant portions of the cancellation deed are extracted below:

“The parties hereto mutually and voluntarily cancel, revoke and terminate the transaction relating to the property bearing Survey No.578/1, 578/2, 577/1 admeasuring “Hectare 13.27 Ares” or thereabout, situate at village Munjeri (Bibwewadi) of the City of Pune, Taluka Pune City, District Pune, within the limits of the Registration District of Pune, Jt Sub.Registrar, Haveli No.1 and the Municipal Corporation of the City of Pune, in “reservation”/ Zoning for the timber market under the Development Plan of Pune City (the said “Land”) witnessed by the agreements dated 18.08.1988 and confirmed by the agreements dated 14.07.1991 (both the documents are referred to as the said “Agreements”).

The Association, with the consent of the Consenting Party (including sub. numbers) renounce all claims, rights, title and interest under the said Agreements relating to the said Land, inducing t