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2025 Supreme(Online)(KAR) 1853
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
MR. JUSTICE HEMANT CHANDANGOUDAR, J
Aaress Iron And Steel Limited – Appellant
Versus
State Of Karnataka – Respondent
WRIT PETITION NO. 27387 OF 2016 (LA-KIADB)
Advocate Appeared:
For the Appellant :SRI. ASHOK HARANAHALLI, SENIOR ADVOCATE FOR SRI. SWAMY M.M., ADVOCATE
For the Respondent:SRI. ASHOK J. KATTIMANI, AGA FOR R1 & R4; SRI. G.I. GACHCHINAMATH, ADVOCATE FOR R2 AND R3; SRI. SURESH S. SHETTEMMANAVAR
The court upheld the validity of land allotment to KSSIDC, emphasizing public interest and the petitioner's failure to secure necessary landowner consent, negating any claims under the doctrine of promissory estoppel.
Headnote:(A) Karnataka Industries (Facilitation) Act, 2002 - Sections 3 and 5 - KIADB Act, 1966 - Section 28(4) - Challenge to allotment of land for industrial estate - Petitioner contended that the allotment to KSSIDC was unauthorized as it did not qualify as an entrepreneur under the Act - Doctrine of promissory estoppel invoked - Court found that the petitioner failed to secure necessary landowner consent, thus no vested rights existed - Allotment deemed in public interest due to delays in project implementation. (Paras 7, 10, 30, 34)
(B) Judicial Review - The court emphasized that the exercise of discretionary powers by the State must not be arbitrary or unreasonable, and public interest must be prioritized. (Paras 31, 32)
Facts of the case:
The petitioner challenged the allotment of 104 acres of land to KSSIDC, arguing it was part of land earmarked for their steel plant project. The petitioner failed to secure consent from landowners, leading to delays in project implementation.
Findings of Court:
The court found the allotment to KSSIDC valid, emphasizing public interest and the petitioner's failure to comply with necessary conditions.
Issues: Whether the allotment of land to KSSIDC was lawful given the petitioner's prior approval and the doctrine of promissory estoppel.
Ratio Decidendi: The court ruled that the petitioner had no vested rights due to non-compliance with consent requirements, and the allotment was justified in the interest of promoting small-scale industries.
Result: Petition dismissed.
ORAL ORDER
The petitioner seeks a writ in nature of Certiorari to quash the Final Notification dated 20.11.2014 issued in G.O No. CI 137 SPQ 2014, passed by respondent No.1 vide Annexure N (the impugned document at Annexure N is dated 25.09.2014) and the G.O dated 2.11.2012, bearing No. CI 96 SPI 2008, passed by the respondent No.1, vide Annexure H, by which, the respondent No. 2 - KIADB was directed to earmark 104 acres of land to respondent No. 3 - KSSIDC for formation of an industrial estate, out of the land initially approved to the petitioner.
2. The instant petition is a challenge posed by an earlier allottee against the allotment of 104 acres (approx.) of land to respondent No. 3 - KSSIDC, out of the 965 acres (approx.) of lands initially earmarked for acquisition for the benefit of the petitioner.
3. The 8th SHLCC in its proceedings dated 23.02.2007 had resolved to approve the proposal of the petitioner to establish 1.5 mmtpa steel plant and directed the respondent No.2 - KIADB to acquire 922 acres of land in Basapura Village, Koppal Taluk. At the request of the petitioner to increase the installation capacity to 2.5 mmtpa and to further acquire and allot 965.50 acres of land for project, the 13th SHLCC in its proceedings held on 13.3.2008 had resolved to approve the proposal of the petitioner by adding two following conditions, conveyed to the petitioner vide Government Order bearing No. CI 96 SPI 2008, Bangalore, dated 09.05.2008.
• the promoter shall secure consent from the respective landowners in respect of 75% of the land proposed to be acquired by the KIADB prior to commencement of acquisition; and
• the project proponents shall provide employment for at least one member of the family of each land loser.
4. The same was the subject matter of the P.I.L in W.P No.11065/2008, which was ultimately withdrawn on 16.10.2014.
5. The petitioner, however, requested for extension of time to implement the project vide communication dated 03.02.2012. Given the circumstances, the respondent No. 3 - KISSIDC on 03.03.2012 sought necessary information from Karnataka Uduyog Mithra for acquiring the land for the purpose of establishing an industrial estate in the area. The 29th SHLCC on 06.09.2012 while granting extension of two years of time to the petitioner to implement the project, directed the KIADB to allot 104 acres of land out of the land approved to the petitioner.
6. Subsequently, the respondent No.1 vide order dated 2.11.2012 at Annexure H directed the KIADB to earmark 104 acres of land to KSSIDC formation of industrial estate. The petitioner's request to withdraw the earmarking 104 acres of land to the KSSIDC was not acceded to and the proceedings were initiated to acquire 104.11 acres of land for the purpose of respondent No.3 - KSSIDC, which culminated in publishing of final notification under Section 28(4) of the KIADB Act dated 25.09.2014, at Annexure N. Aggrieved, the petitioner has preferred the instant petition. The prayer impugning Annexure N however, appears to have erroneously mentioned the date of said notification as 20.11.2014.
Submissions
7. Sri Ashok Haranahalli, learned Senior Counsel appearing for the petitioner’s counsel argues that the respondent No.3 - KSSIDC does not come under the ambit of entrepreneur as defined under Section 3 (2) of the Karnataka Industries (Facilitation) Act, 2002 . Therefore, the earmarking of 104 acres of land out of the land approved to the petitioner lacks authority. He further argues that the Government having approved the project and also promised to allot the required land, the State cannot resile from the said promise as the Government is bound by its promise.
7.1. In other words, the principle of the doctrine of estoppel that the law will not permit an unconscionable departure by one party from the subject matter of an assumption which has been adopted by other party as the basis of a code of conduct, which would affect other party if the assumption be not adhered to.
7.2. The
