IMPORTANT POINTS
Releasing acquired land in favour of builder tantamount to acquisition for a private purpose and permitting profiteering at the cost of livelihood and existence of a farmer.
Non-maintainability of belated petition is only a rule of practice and not jurisdictional bar.
Fraud on power voids the action of the authority.
Once acquisition order/transaction is vitiated, there could be no estoppel on the ground that compensation/consideration has been received.
When acquired land is released in favour of a builder, the acquisition need not be quashed in entirety.

Headnote:(a) Land Acquisition – Builder coming into picture after acquisition notification – Application for release of land in favour of the builder entertained – Tantamount to acquisition for a private purpose – Amounts to permitting profiteering at the cost of livelihood and existence of a farmer – Violative of guaranteed fundamental rights of equality and right to property and to life – What cannot be done directly cannot be done indirectly also – Builder could not have entered the scene without fraudulent and clandestine exercise of power by the State – Not permissible – Public Trust Doctrine (Para 14, 15)
       (2010) 7 SCC 1; (2012) 3 SCC 1; (2012) 10 SCC 1; (2014) 9 SCC 516 – Relied upon
       (b) Land Acquisition Act, 1894 – Section 48 – State government Policy dated 6th March, 2000 – Land owners prior to acquisition notification only entitled to apply for release of land from acquisition – Instantly Builder-appellant buying the land after issue of acquisition notification – Making application for grant of licence, though purportedly made by land owners – Benefit of policy not available to Builder-appellant. (Para 17)
       © Constitution of India – Article 226 and 136 – Non-maintainability of belated petition – Only a rule of practice and not jurisdictional bar – Instantly administrative action or private transaction allowing transfer of land sought to be acquired for a public purpose to private persons would be vitiated by fraud – Such illegal action can be quashed on basis of even belated writ petition – Not liable to be interfered under Article 136. (Para 18)
       (2011) 10 SCC 608 – Relied upon
       (d) Land acquisition – Fraud – Fraud on power voids the action of the authority – Mala fides can be inferred from undisputed facts even without naming a particular officer and even without positive evidence – Once acquisition order/transaction is vitiated, there could be no estoppel on the ground that compensation/consideration has been received. (Para 19)
       (1980) 2 SCC 417; (2011) 12 SCC 375; (1970) 3 SCC 602; (1986) 1 SCC 133 – Relied upon
       (e) Land Acquisition Act, 1894 – Section 4 and 48 – Section 4 notification validly notified – Thereafter builder coming into picture – Government releasing land from acquisition in favour of builder – Moulding of relief – Acquisition need not be quashed in entirety – What is need to be quashed is the illegality – Doctrine of severability – In case of mala fide release of land from acquisition, acquisition of released land stands revived – Land owners/builder to be compensated – No interest to builder – Subsequent transactions entered into by the builder are hit by the principle of lis pendens – The matter may call for action against those who have misused their power and to find out the considerations for such misuse. (Para 23, 25, 26)
       (2014) 15 SCC 394; (2011) 6 SCC 508 – Relied upon
       Facts of the case:
       850.88 acres of land was proposed to be acquired for residential/commercial Sector 27-28, Rohtak, Haryana by the Haryana Urban Development Authority under the Haryana Urban Development Authority Act, 1977. However, the final notification was in respect of 441.11 acres. Award was for 422.44 acres.
       Appellant – Uddar Gagan Properties Limited who is a Builder-cum-Developer entered into collaboration agreements with some of the farmers – owners whose land was under acquisition on 02nd March, 2005 for development of a Colony in accordance with the Haryana Development and Regulation of Urban Areas Act, 1975. The Builder made applications on and around 21st March, 2005 to the Director, Town and Country Planning, Chandigarh, Haryana for grant of licence to develop a colony on land covering about 280 acres. The licences were granted on and around 12th June, 2006 and corresponding land was released from acquisition. The licences were addressed to the owners but remitted to the builder. This was followed by execution of sale deeds in favour of the builder through power of attorney holder of the land owners.
       High Court allowed the writ petitions.
       Principal question which has fallen for consideration is whether the power of the State to acquire land for a public purpose has been used in the present case to facilitate transfer of title of the land of original owners to a private builder to advance the business interest of the said builder which is not legally permissible. Further question is whether on admitted facts, the acquisition of land is entirely or partly for a private company without following the statutory procedure for the said purpose. Further question is how in the facts and circumstances relief could be moulded.
       Finding ofm the Court:
       Impugned judgment does not warrant interference.
       Result: Appeal disposed of

JUDGMENT

ANIL R. DAVE, J.

1. Leave granted. Principal question which has fallen for consideration is whether the power of the State to acquire land for a public purpose has been used in the present case to facilitate transfer of title of the land of original owners to a private builder to advance the business interest of the said builder which is not legally permissible. Further question is whether on admitted facts, the acquisition of land is entirely or partly for a private company without following the statutory procedure for the said purpose. Further question is how in the facts and circumstances relief could be moulded.

2. Vide notification dated 11th April, 2002, 850.88 acres of land was proposed to be acquired for residential/commercial Sector 27-28, Rohtak, Haryana by the Haryana Urban Development Authority under the Haryana Urban Development Authority Act, 1977 (‘the 1977 Act’). However, the final notification dated 8th April, 2003 under Section 6 of the Land Acquisition Act, 1894 (‘the 1894 Act’), according to the impugned order of the High Court, was in respect of 441.11 acres. Award dated 6th April, 2005 was for 422.44 acres. Appellant – Uddar Gagan Properties Limited (‘the Builder’) who is a Builder-cum-Developer entered into collaboration agreements with some of the farmers – owners whose land was under acquisition on 02nd March, 2005 for development of a Colony in accordance with the Haryana Development and Regulation of Urban Areas Act, 1975(‘the 1975 Act’). The Builder made applications on and around 21st March, 2005 to the Director, Town and Country Planning, Chandigarh, Haryana for grant of licence to develop a colony on land covering about 280 acres. The licences were granted on and around 12th June, 2006 and corresponding land was released from acquisition. The licences were addressed to the owners but remitted to the builder. This was followed by execution of sale deeds in favour of the builder through power of attorney holder of the land owners.

3. It was on these undisputed facts that the High Court was called upon to examine the questions on a group of petition/s by the land owners which are framed in the impugned judgment as follows :

[i] Whether the object behind the subject-acquisition was to achieve a bona-fide public purpose or to use it as a cloak for the private benefit of Builder-cum-Developer?

[ii] Whether the power of 'eminent domain' has been exercised in violation of Articles 14, 21 and 300-A of the Constitution?

[iii] Whether it is lawful to enter into 'Agreement to Sell' or 'Collaboration Agreement' in respect of the land under acquisition and can an instrument of sale be executed in respect of such land?

[iv] Whether a writ court in exercise of its powers under Article 226 of the Constitution is competent to annul a sale-transaction executed in violation of and on playing a fraud on the Statute?

[v] Whether the orders granting Licenses or releasing the acquired land have been passed in favour of 11th respondent in accordance with provisions of 1975 State Act?

[vi] Whether the petitioners have got locus standi to challenge the 'licences' or the orders of release of the acquired land in favour of respondent No. 11?

[vii] Whether writ petitions suffer from inordinate delay and latches?”

4. It was held that in view of the scheme of the 1977 Act, the notified public purpose for acquisition was covered by Section 3(f)(ii) and (iv) of the 1894 Act, but the events following the notification for acquisition unfolded different story. After receipt of notices by the land owners under Section 9 of the 1894 Act, calling upon them to appear before the Collector for determination of compensation, the builder suddenly surfaced in March, 2005 and applied for grant of licences for setting up colony on the land covered by the notification and paid full sale consideration to the land owners. The Government files deceptively projected the initiative to release land at the instance of farmers and owners while t

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2016 Supreme(SC) 377

Cases Referred (9)