Andhra Pradesh High Court - Amravati
Sri Srinivasa Vidya Parishad, vs The State Of Andhra Pradesh, on 27 July, 2021
Bench: M.Satyanarayana Murthy
THE HON'BLE SRI JUSTICE M.SATYANARAYANA MURTHY
WRIT PETITION No.17189 of 2020
ORDER:
Srinivasa Vidya Parishad, a registered society, filed this
petition under Article 226 of the Constitution of India questioning
the action of the respondents in not completing the process of
alienation of the allotted land admeasuring Ac.63.50 cents situated
in Sy.Nos.60/1 to 60/5, 61/1 to 61/7 of Pothina Mallayya Palem and
Sy.No.364/1, 364/2 Madhurawada villages of Visakhapatnam
Mandal and District despite delivery of possession of the said land in
the year 1981 to the petitioner and the initiation of proceedings for
resumption of the land from the petitioner and to declare the same
as illegal, arbitrary and direct the respondents to alienate the land to
the petitioner at the rate which existed at the time of allotment of the
same, in terms of Rc.No.6308 of 1983 dated 19.08.1983 and so as to
confer title to the land on the petitioner, to enable the petitioner to
carry on its educational institutions in the site.
The petitioner is an educational society registered with the
Registrar of Cooperative Societies vide registration No.51/1980,
dated 06.03.1980 under the Societies Registration Act, 1960 with the
objective of establishing and to run various educational
institutions/colleges, in particular, law college/technical education
etc ., and in that pursuit, it has approached the State
Government to alienate land, so that it can be used for construction
of buildings for housing various colleges and educational
institutions, in particular law college and technical education etc.
The State having been impressed by the presentation of the
profile by the petitioner, respondent No.2 vide proceeding in
Rc.No.6308/83 dated 19.08.1983 has allotted two land parcels
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admeasuring Ac.32.50 cents in Pothina Mallayya Palem (Sy.Nos.60/1
to 5 and 61/1 to 7) and another extent of Ac.31.00 cents in
Madhurawada village of Visakhapatnam Mandal (Sy.Nos.364/1 and
2, 365/1 to 4 and 366/1 to 3) on the specific condition that the
allotment of land is for establishment of Nyaya Vidya Parishad
(National Law School) and Sanketika Vidya Parishad (Engineering
college) on alienation basis and called for the alienation proposals
from respondent No.3. The possession of the land was delivered to
the petitioner on 16.01.1981, since then the petitioner is in exclusive
physical possession and enjoyment of the said land (totally
admeasuring Ac.63-50 cents).
The allotment of land and delivery of possession in favour of
the petitioner has amounted to a government grant within the
meaning of the Government Grants Act, 1895. Hence, the provisions
of the Transfer of Property Act, 1882 are not applicable to the said
transaction. Though the respondents delivered possession of the
property about 36 years ago and the petitioner has been in exclusive
and continuous possession and enjoyment of the said land, the
alienation process is not completed.
The petitioner constructed various buildings in the said land
and established educational institutions/colleges in the buildings,
which are as follows:
A. POTHINA MALLAYYA PALEM
1) Sanketika Vidya Parishad Engineering College
a) B. Tech, b) M. Tech, c) MBA and d) MCA
2) Sanketika Institute of Technology and Management
a) B. Tech., b) M. Tech.
3) Srinivasa Rao College of Pharmacy
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a) B. Pharmacy, b) M. Pharmacy, c) Pharma. D
4) S.V.P. Industrial Training College
a) ITI
5) Sanketika Polytechnic
6) Skill Development Centre in Collaboration with ILFS
(Infrastructure Leasing and Financial Services) New Delhi.
B. Madhurawada
1. N.V.P. Law College.
a) 3 years LLB, b) 5 years LLB, c) 2 years LLM
2. Srinivasa Institute of Management Studies (SIMS)
a) BBA, b) MBA, c) MCA
3. Centre for Management & Technology (CMT)
a. PGDM/MBA
4. Greendale International School.
Facilities with Sports Arena, Food Court, Football Ground, 200
Mtr Track, Volley Ball, Throw Ball, Horse Polo Club, Art Village,
Basket Ball, Tennis Court, Play Pen, Galleries, Amphitheatre etc.
5. Rajyalakshmi Junior College
a) M.P.C., b) Bi.P.C., c) C.E.C.
As the petitioner is contemplating to construct few more
buildings which comprise of built up area of about 1.5 lakh sft. each
(for the purpose of extension of existing engineering college and for
2000 persons capacity auditorium and Central Library, Hostels etc)
and to promote fashion technology institution in a built up area of
40,000 sft. it is intending to utilize the entire land to construct
buildings and establish educational institutions etc.
Since the date of inducting the petitioner into possession in
pursuance of the proceedings, the petitioner making representation
to the authorities for expeditious action to complete alienation
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proposals and the State authorities have not done anything positive
in that context.
Recently, respondent No.2 vide letter dated 16.10.2017 called
upon the respondent No.3 to conduct survey and submit proposals
for alienation or for resumption of the land. Thus, it is clear that
the respondents have not taken any definite decision about the
alienation of the land in favour of the petitioner. The State
authorities seem to have an impression that the present market
value of the land is to be applied for alienating the land to the
petitioner though the land was allotted in the year 1983 and
possession was delivered in the year 1987. The state cannot take
advantage of hike in prices and demand for payment of the present
market value and cannot resume the land after 36 years.
The petitioner mainly raised the following contentions to issue
a direction as sought for.
(a) The land was proposed for allotment in the year 1983,
delivered possession in 1987 and allowed the petitioner to
utilise major part of the site by raising massive construction
for education purpose and to cater the educational needs of
the public of the Visakhapatnam area. The respondents, now,
contemplating to resume the land and failed to keep up their
promise, thereby 64000 students will lose their opportunity to
continue their studies besides 590 staff working in the
educational institutions will be put to serious loss.
(b) Though the respondents promised and fulfilled its part of
obligation, no final proceedings were issued alienating the
property to the petitioner, failed to keep up its promise,
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thereby the respondents are not entitled to resume the land
from the possession of the petitioner.
(c) It is further contended that the respondents committed breach
of promise and the State cannot be allowed to capitalize of its
own default to proceed either with resumption of land or
imposition of present market value for alienation of the land.
On the principle of estoppel and waiver as held by the Apex
Court in "B.L.Sreedhar v. K.M.Munireddy (Dead) and
others1" and "Ram Chand v. Union of India2", the State
should be restrained from taking any coercive steps against
the petitioner.
(d) The grant made in favour of the petitioner in the year 1981
was unconditional; thereby resumption of the grant does not
arise. On this ground alone, the proposed action to resume
the land by the respondents is illegal.
(e) The petitioner approached this Court earlier and despite the
order passed by this Court in W.P.No.11433 of 1995, the
respondents did not finalise the alienation proposals and that
the petitioner perfected his title by adverse possession and
willing to pay market value of the land existed in the year
1983, hence, the petitioner requested to issue a direction as
claimed in the writ petition.
Respondents filed counter denying all the material allegations
interalia contending that based on the requisition of the petitioner,
the then District Collector, Visakhapatnam issued proceedings
Rc.No.594/1981/B2 dated 10.01.1981 to handover advance
AIR 2003 SC 578
1994 (1) SCC 44
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possession of certain land to the petitioner for establishment of
National Law College and Engineering College pending finalization of
alienation proposals. Accordingly, the land in different survey
numbers was handed over to the petitioner on 16.01.1981, which is
as follows:
Name of Survey Extent in Name of the Survey Extent
the Village No. Ac.cts Villag No. in Ac.cts
e
PM Palem 60/1 1.91 Madhurawadaa 364/1 5.03
60/2 2.39 364/2 5.10
60/3 1.00 365/1 4.26
60/4 3.09 365/2 3.25
60/5 4.99 365/3 3.52
61/1 1.90 365/4 1.17
61/2 0.43 366/1 3.07
61/3 0.69 366/2 3.30
61/4 4.65 366/3 2.30
61/5 0.35 Total 31.00
61/6 5.00
61/7 6.10
Total 32.50
It is further contended that based on the representation of
Sri Srinivasa Vidya Parishad stating that the land allotted
could not be utilized for the purpose and requested for
permission to utilize for other Educational purposes, vide
proceedings Rc.No.6308/83/dt.19.08.1983 the District Collector,
Visakhapatnam district accorded permission to Sri Srinivasa Vidya
Parishad to utilize the land allotted in Pothinamallayyapalem and
Madhurawada villages of Visakhapatnam Rural Mandal for General
Education and Other Education purposes.
The Government vide G.O.Ms.No.635 dated 02.07.1990 has
enhanced the powers of Commissioner of Land Revenue and the
District Collector for disposal of land to different bodies
wherein the District Collector is vested with power to dispose land to
companies, private associations and private corporations and
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private individuals for which market value of Rs.l0,000/- and
Ac.0.25 cts or 0.10 guntas whichever is less. Prior to the said
G.O., the District Collector was competent to dispose the land to
private individuals where the market value does not exceed
Rs.1,000/-. Therefore, in the present case, the then District
Collector has ordered to handover advance possession of land
to the petitioner to an extent of Ac.63.50 cts which is beyond
the powers vested on him. Therefore, the said proceedings
Rc.No.594/1981/B2 dated l0.01.1981 were issued without
jurisdiction, consequently they are unsustainable under law.
The respondents further contended that the land in an extent
of Ac.63.50 cts in various Survey number of P.M.Palem and
Madhurawada villages of Visakhapatnam Rural Mandal is pending
finalization of the alienation proposals. The handing over of
possession of the land by the District Collector is not absolute and
only subject to the decision of the competent authority through
alienation proposals.
It is further contended that the above land was handed over to
the petitioner pending alienation. BSO-24 governs the subject
matter of alienations to Government departments, private bodies,
institutions and individuals. In the present case, the handing
over advance possession of subject matter of land to the petitioner
is governed by BSO-24 and therefore, the petitioner cannot contend
that the delivery of possession in his favour amounts to a
Government Grant within the meaning of Government Grants
Act, 1895 and hence, the provisions of the Transfer of Property
Act, 1882 are not applicable. In this case, the then District Collector
had no power to give advance possession for such an extent of land.
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A grant is stated to have been made only in the exclusive powers
vested on the Government.
The respondents further contended that the petitioner has
submitted the details of the various Educational Institutions
established in the above land and also future expansion plans. A
period of 39 years have already elapsed and the contention of
future expansion is not correct and the petitioner is intended to
keep the Government land in the clutches of the petitioner,
which does not deserve any consideration.
It is also contended that in view of reasons explained in the
earlier paragraphs, the land to an extent of Ac.63.50 cts in various
Survey numbers of Pothinamallayyapalem village and
Madhurawada village of Visakhapatnam Rural Mandal was handed
over to the petitioners on 16.01.1981 pending finalization of
alienation proposals for establishment of National Law
College and Engineering College.
As seen from the material available on record, the then Joint
Collector, Visakhapatnam inspected the land in the year 1995 and
ordered to take back unutilized land and to submit regular
alienation proposals for the remaining land. The extent of unutilized
is as follows.
Sl.No. Name of the Village Survey Number Extent found
unutilized
1 Madhurawada 364/1 5.03
365/1A 1.88
365/2B 0.92
365/4 1.16
365/3B 0.32
2 Pothinamayyallapalem 61/1 to 7 19.12
Total 28.43
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The respondents further contended that the then Mandal
Revenue Officer, Visakhapatnam Rural Mandal has issued notice to
the petitioner to handover unused lands to an extent of Ac.9.31
cts at Madhurawada and Ac.19.12cts at P.M.Palem. Aggrieved by
the above action, petitioner has filed W.P.No.11443/1995 before
the High Court of Andhra Pradesh, Hyderabad. The Secretary of
the petitioner submitted a representation to the Government for
alienation of above land and in turn the Government vide Memo
NoA9986/Assn.-1 (3)/2003-1 Revenue (Assn.I) Department, dated
15.12.2003 issued instruction to send alienation proposals. The
said proposal could not be submitted due to pendency of writ
petition.
It is further contended that the High Court on 29.07.2009
disposed the W.P.No.11433 of 1995 directing respondents to
finalize the alienation proposals in favour of the petitioner society
as per Government Memo dated 15.12.2003. Smt.Pothina
Atchiyyamma W/o late Adiyya and Matta Suvarna Raju have
filed W.P.No.8690 of 2007, contending that Ac.4.26 cts in
Sy.No.365/1 of Madhurawada village is assigned in favour of
Pothina Adiyya under EX.Serviceman quota in the year 1970
and prayed to issue directions to the respondent not to
interfere with their enjoyment. The High Court passed orders
on 29.07.2009 directing the respondents therein not to interfere
with the possession and enjoyment of the petitioner in respect of
the land in an extent of Ac.4.26cts, Sy.No.365/1 of Madhurawada
village without following due process of law. Accordingly alienation
proposals from the Tahsildar, Visakhapatnam Rural excluding
the above land were called for vide Rc.No.2964/2002/dt.3.11.2009.
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The Tahsildar Visakhapatnam Rural Mandal and Revenue
Divisional Officer, Visakhapatnam have submitted the proposals
for alienation of an extent of Ac.59.24 cts excluding Ac.4.26 cts in
Sy.No.365/1 of Madhurawada village. The then Joint Collector
inspected the land on 05.12.2013 and observed that some parts in
the premises are kept vacant by the institutions. Hence, he has
recommended to conduct survey on ground and report actual build
up area and vacant area duly demarcating in the sketch.
Accordingly, Lr.Rc.No.2964/2002/E2 dated 27.2.2013 was
addressed to the Tahsildar, Visakhapatnam Rural Mandal to submit
report. The then Joint Collector inspected the land on 17.08.2017
and as per the above inspection report following is the status of land
on ground.
Sl. Name of the Village Survey Built up Vacant Remarks
No. area on
No
ground
Ac.cts
Ac.cts
1 364/1 - 2.48 Land handed over
Housing Dept for
construction of HUD
HUD housing court
case is pending
between Assignee
and Government
364/2 0.72 4.38 Constructed
Scattered buildings
364/3 0.07 2.48
and most of the
extent is left vacant
365/1 4.26 - VUDA Layout
365/2 0.47 2.79 Constructed
Greendale
International School
Madhurawada building, 2 sheds
and vacant land is
covered with
bushes.
365/3 0.03 3.49 Newly established
play ground and one
shed.
365/4 - 1.16 Vacant on ground.
Covered with
bushes
366/1 0.04 3.03 Newly established
play ground and
open gallery
366/2 0.10 3.20 Newly established
Basket Ball court,
sports room and
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Horse shed
366/3A 0.02 2.28 Security guard room
and 3B and rest of land are
vacant on ground
366/4 - - Vacant on ground.
2 60 - - 90% of the land is
covered with college
building and play
ground
61 - - Nearly at about in
Ac.2.00 cts of land
P.M.Palem Civil Engineering
block, ACC shed,
Two RCC building
and play ground
were established
and most of land is
vacant on ground
In view of the above, it is clear that the petitioner has not
utilized approximately an extent of Ac.25.00 cts out of the total
extent of land handed over to the petitioner. The land allotted to the
petitioner is lying vacant and the said land is located in prime
locations of Visakhapatnam. Since the land was allotted pending
alienation, the Government is competent to resume the land in the
event of non utilization as per the conditions laid down in BSO 24.
It is further contended that the Government has issued
guidelines vide G.O.Ms.No.571 Revenue Department dated
14.09.2012 for alienation of Government lands to various
institutions and individuals either on payment of market value
or free of cost. According to the said guidelines, the applicant
has to submit requisition in Appendix-XXIX and also justification
from the secretary to Government of the Administrative Department
concerned in the proforma Annexure-XI. After receipt of the
above two requisitions, the District Collector will process the
alienation proposals and submit the same with specific
recommendation on market value to the Chief Commissioner of
Land Administration for placing the proposal before the AP
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Land Management Authority (APLMA) for consideration
and approval. After the proposal is approved by the APLMA, the
same will be transferred to Revenue Department by the
Government of A.P., which in turn circulate the proposal and
also places before the Cabinet by following due procedure.
Thereafter, the cabinet approves and the Government may issue
final orders for alienation of the land to departments, institutions,
private bodies and individuals either on payment of
Market value or free of cost, and finally, the land will be
delivered to the alienee after collecting Market Value.
Finally, the respondents contended that as the land was not
utilized fully, the unutilized land is to be returned to the State in
terms of BSO 24. However, a Special Investigation Team (SIT) is
constituted to conduct special investigation in the year 2019 and
taken over the connected file along with other files relating to
proposed allotment of subject land to the petitioner for investigation
and the outcome of the investigation is awaited. Therefore, in those
circumstances, the alienation is not valid and it could not be
completed, finally requested to dismiss the writ petition.
During hearing, Sri Vedula Venkata Ramana, learned senior
counsel, would contend that possession of the property was delivered
in the year 1983 during pendency of alienation proposals and
allowed to raise massive constructions for accommodating
educational institutions, now the Government cannot resile from its
promise and resume the unutilized land after 36 years and such
demand for payment of present market value and proposed
resumption of part of the land is contrary to the judgment in
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W.P.No.11433 of 1995 as the respondents did not complete the
process of alienation.
It is further contended that when once the State has taken
decision, it is a law as defined under Section 2 (f) of the Andhra
Pradesh Reorganization Act, 2014 and it is the obligation of the
residuary State to implement the decision taken by the common
State. He placed reliance on the judgments of the Apex Court in
"State of Punjab v. Balbir Singh3", "State of Uttar Pradesh v.
Hari Ram4" "Azim Ahmad Kazmi v. State of Uttar Pradesh5" to
contend that allotment is a Government grant and such allotment is
governed by the terms of the grant, when once the Government has
absolute discretion to incorporate such conditions, limitations or
restrictions as per the terms of grant as it considers it, the
Government is bound by the terms incorporated therein and cannot
resile from the terms of original grant, which is governed by the
Government Grants Act. He placed reliance on the judgment of the
Apex Court in "the State of U.P. v. Zahoor Ahmad6". On the
strength of the principles laid down in the above judgments, learned
senior counsel contended that the respondents having suffered from
an order in writ petition No.11433 of 1995, allowed the petitioner to
raise massive construction in the land allotted to it, now, the State
cannot insist the petitioner for payment of market value as on date
and cannot resume the unutilized land. Therefore, the proposed act
of the respondents to collect the present market values and to
resume the part of the land is illegal, arbitrary and violative of
(1976) 3 Supreme Court Cases 242
(2013) 4 SCC 280
(2012) 7 SCC 278
(1973) 2 SCC 547
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principle of legitimate expectation, requested to issue a direction as
claimed in the writ petition.
Sri Ponnavolu Sudhakar Reddy, learned Additional Advocate
General, while supporting the contentions urged in the counter,
more particularly about the powers of the Collector to alienate the
land with reference to BSO 24, strongly supported the proposed
action of the respondents, placed reliance on the judgment of the
Apex Court in "Motilal Padampat Sugar Mills Co. Ltd. v. State of
Uttar Pradesh7" and other two judgments of the High Court of
Andhra Pradesh in "S. Lingamaiah v. State of A.P.8" and "Road
Metal Industry v. Secretary to Government of A.P.9", where the
Court held that basically, the Government being the owner of the
land can allot it for any purpose, which is conducive to the welfare of
the State. There are also some statutory provisions, which provided
inter alia for such assignment e.g. Board‟s Standing Order 24 and
such alienation without authority is illegal, arbitrary and that the
Court cannot issue a direction to the respondents based on such
alienation, requested to dismiss the writ petition.
Considering rival contentions, perusing the material available
on record, the points that need to be answered by this Court are as
follows:
(1) Whether the allotment of land and handing over of
the advance possession of the land pending alienation
is governed by the Government Grants Act? If not,
whether the State is competent to revoke the grant to
the extent of unutilised portion of the land in
1979 (2) SCC 409
2004 (2) ALD 837
2001 (5) ALT 670
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Sy.Nos.60/1 to 60/5, 61/1 to 61/7 of POthina Mallayya
Palem and Sy.No.364/1, 364/2 Madhurawada Villages
of Visakhapatnam Mandal?
(2) Whether the petitioner is liable to pay market value of
the land as on date on completion of alienation
proposals for an extent of Ac.63.50 cents situated in
Sy.Nos.60/1 to 60/5, 61/1 to 61/7 of Pothina Mallayya
Palem and Sy.No.364/1, 364/2 of Madhurawada
Villages of Visakhapatnam Mandal? If not, Whether
the State is entitled to resume the land after such
long period of 39 years having allowed the petitioner
to construct various buildings in the land allotted to
it for running educational institutions for the benefit
of public at large?
P O I N T No.1:
The first and foremost contention of the learned senior
counsel for the petitioner is that the allotment of land to the
petitioner is Government Grant governed by the provisions of the
Governments Grants Act, whereas learned Additional Advocate
General Sri P.Sudhakara Reddy would contend that the Collector,
Visakhapatnam District allotted the land by exercising power under
BSO 24 of A.P.Revenue Board Standing Orders, exceeding
authorisation. Therefore, the grant is governed by BSO 24 and land
alienation policy of the State but not by the Government Grants Act.
In view of the little controversy about the law governing such
allotment, it is appropriate to advert to the proceedings issued by
the District Collector on 10.01.1981 for better appreciation and the
same is extracted hereunuder.
"Pending finalization of alienation proposals and in order to avoid
encroachments by un-authorised people, the Tahsildar, Visakhapatnam is
hereby permitted to handover the following State lands in Pothina
Mallayyapalem and Madhurawada villages of Visakhapatnam Taluk to Sri
Sreenivas Vidya Parishad, Visakhapatnam for the location of "Nyaya Vidya
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Parishad (National Law College) and Sanketika Vidya Parishad (Engineering
College) Visakhapatnam and obtain proper acknowledgement.
Name of Survey Extent in Name of the Survey Extent in
the Village No. Ac.cts Village No. Ac.cts
PM Palem 60/1 1.91 Madhurawada 364/1 5.03
60/2 2.39 364/2 5.10
60/3 1.00 365/1 4.26
60/4 3.09 365/2 3.25
60/5 4.99 365/3 3.52
61/1 1.90 365/4 1.17
61/2 0.43 366/1 3.07
61/3 0.69 366/2 3.30
61/4 4.65 366/3 2.30
61/5 0.35 Total 31.00
61/6 5.00
61/7 6.10
Total 32.50
The Tahsildar, Visakhapatnam is also requested to finalise the allocation
proposals and submit them in complete shape within 3 weeks."
A bare look at the contents of the order of the District
Collector dated 10.01.1981, the Collector decided to alienate the
land in favour of the petitioner shown in different survey numbers in
the table extracted above, pending finalization of alienation
proposals to avoid encroachments by un-authorised people, the
Tahsildar, Visakhapatnam was also permitted to handover the State
lands in Pothina Mallayyapalem and Madhurawada villages of
Visakhapatnam Taluk to Sri Sreenivas Vidya Parishad,
Visakhapatnam for the location of "Nyaya Vidya Parishad (National
Law College) and Sanketika Vidya Parishad (Engineering College)
Visakhapatnam and obtain proper acknowledgement.
The District Collector agreed to alienate the property shown in
the proceedings and directed the Tahsildar to deliver vacant
possession of the property. In pursuance of the letter dated
10.01.1981 issued by the Collector, the Tahsildar delivered the
possession of the property both at Pothinamallayyapalemn Village
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and Madhuravada to the Secretary, Sri Srinivasa Vidya Parishad,
Visakhapatnam and obtained delivery receipt from the Secretary of
the petitioner on 16.01.1981. A copy of the delivery receipt is also
placed on record by the petitioner. Thus, the allotment of land and
delivery of vacant possession of the property to the petitioner in
different survey numbers (referred supra) is not in dispute.
According to the terms of allotment during finalisation of
alienation proposals, the land should be utilised for the purpose of
establishing Nyaya Vidya Parishad (National Law College) and
Sanketika Vidya Parishad (Engineering College). But the petitioner
could not utilise the total land for the purpose stated in the letter
dated 10.01.1981 extracted above, addressed a letter dated
23.03.1983 to the District Collector, Visakhapatnam to permit the
petitioner to utilise the land for other educational institutions. The
Collector, Visakhapatnam issued proceedings in R.C.6308/83/B2
dated 19.08.1983 while reiterating the allotment of land to the
petitioner for establishment of Nyaya Vidya Parishad (National Law
College) and Sanketika Vidya Parishad (Engineering College),
granted permission to utilise the land allotted for construction of
college buildings/facilities, while directing the Tahsildar to send
alienation proposals within two weeks without fail. A copy of the
proceedings of the District Collector is also placed on record.
It is clear from the proceedings referred above, the property
can be utilised for any educational purpose including general
education. Accordingly, the petitioner constructed several buildings
as shown in the table above, still, there is some land unutilised
according to the respondents. Therefore, utilisation of major part of
the land is not in dispute including allotment of land. The allotment
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is nothing but making a grant in favour of one person or institution
by the Government. Therefore, such allotment during pendency of
alienation can be said to be transfer of interest in immovable
property. Therefore, the petitioner is entitled to continue and utilise
the property for the purpose permitted by the State. The petitioner is
utilising the property only for educational purpose not for any other
purpose. Hence, the grant in favour of the petitioner by the State
can be said to be a Government grant. But the word "Government
Grant" is not defined anywhere in the Government Grants Act. The
"Government grant" can be defined as follows:
Government grant means and includes assistance by government in the
form of transfers of resources to an entity in return for past or future
compliance with certain conditions relating to the operating activities of the
entity. They exclude those forms of government assistance which
cannot reasonably have a value placed upon them and transactions with
government which cannot be distinguished from the normal trading
transactions of the entity.
In the present case, allotment of land during pendency of
alienation proceedings can be said to be Government Grant in the
form of transfer of resources to an entity i.e. petitioner - Society with
certain condition to establish educational institutions i.e. Nyaya
Vidya Parishad (National Law School) and Sanketika Vidya Parishad
(Engineering college). Later, the conditions were relaxed permitting
the petitioner to utilise the land for general education in view of the
proceedings stated above. Therefore, the grant can be said to be a
Government grant.
The connotation of Government Contract was discussed by the
High Court of Judicature at Bombay in "Bank of Baroda v.
Mumbai Metropolitan Regional Development Authority
(W.P.No.750 of 2000)." In the facts of the above judgment, lease was
granted by Mumbai Metropolitan Regional Development Authority in
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favour of Bank of Baroda. Later, after expiry of lease, bank was
allowed to continue in possession and the same was held to be as
tenant, but the contention was that the Mumbai Metropolitan
Regional Development Authority is not a Government, it is only a
Corporation. Consequently, the Government Grants Act is not
applicable, as such the lease is governed by the Transfer of Property
Act.
In "Cosmopolitan Club v Government of Tamil Nadu
(W.P.No.9636 of 1999)" an identical question came up for
consideration with regard to continue in possession after expiry of
lease period, but the Court held that Once the Government, in the
public interest, exercise their option and refuse the renewal of lease
governed under the provisions of the Government Grants Act, the
properties go back to the Government at the end of the lease period.
Therefore, Government grant by way of lease is deemed to be
permitted in the public interest. Though, the principle laid down in
the above judgment is pertaining to lease, the Government can
refuse to renew the lease in the public interest.
The word "allotment" is defined in "Amar Singh v. Custodian
Evacuee Property, Punjab10" by the Apex Court, which is as
follows:
"allotment' is defined as meaning the grant by a person duly
authorised of a right of use or occupation of an immovable evacuee
property to any other person but does not include a grant by way of a
lease."
Herein, the land was allotted except alienation of land on
papers. Hence, the allotment itself can be said to be a grant in
favour of the petitioner by the Government.
AIR 1957 SC 599
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In "Jnanendra NathNanda v. JaduNath Banerji11", an
example of a Government grant within the meaning of
the Government Grants Act wad discussed. In the facts of the above
judgment, two leases of two lots were granted by the Sunderban
Commissioner on behalf of the Secretary of State. The lands
comprised in the two lots were waste lands of the Government. The
waste lands of the Sunderbans were not the, property of any
subject. The Sundebans were a vast impenetrable forest. It was the
property of the East India Company. It later on vested in the Crown
in those days by virtue of an Imperial statue, as such it is a
Government grant.
In "Secretary of State for India in Council v. Lal Mohan
Chaudhuri12", there is an illustration of "what is not a Government
grant within the meaning of the Government Grants Act". The
Government in that case granted lease in respect of Khas Mahal
lands. The lease of Khas Mahal was held not to fall within the
category of grants as contemplated in the then Crown Grants Act.
The lease in the said case was for the purpose of erecting a
temporary rice mill and for no other purpose. The mere fact that the
State is the lessor will not by itself make it a Government grant
within the meaning of the Government Grants Act.
The lease in favour of third party or institution does not fall
within the definition of Government Grant. In case of Government
Grant, the Government has unfettered discretion to impose any
conditions, limitations, or restrictions in its grants, and the right,
privileges and obligations of the grantee would be regulated
according to the terms of the grant, notwithstanding any provisions
I.L.R. (1938) 1 Cal. 626
I.L.R. 63 Cal. 523
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of any statutory or common law as held in "State of U.P. v. Zahoor
Ahmad13"
When the grant is made by the State can be construed as
Government Grant not by any Corporation and the State can impose
any conditions, limitations, or restrictions in its grants, and the
right, privileges and obligations of the grantee would be regulated
according to the terms of the grant, notwithstanding any provisions
of statute or common law.
In the present case, the grant was made by the Collector
representing the State, allotted the subject land in different survey
numbers as mentioned in the table, during pendency of alienation
proposals, advance possession was also granted. Hence, the grant
made in favour of the petitioner would fall within the meaning of
Government Grant and it is governed by the conditions and
restrictions contained therein, irrespective of the laws applicable.
In the present case, the respondents did not dispute the
allotment of land, handing over possession to the petitioner during
pendency of alienation proposals, but the respondents after lapse of
39 years proposing to resume the land unutilised, issued
proceedings impugned in the writ petition. Such restriction was not
imposed in the grant made initially in favour of the petitioner or
subsequently while granting permission to run general educational
institutions, all of a sudden under the impugned proceedings, State
proposed to resume the un-utilised land. There is no reference about
the public interest in the said proceedings impugned in the writ
petition. In the absence of any condition to resume the land,
proposal to resume the land after 39 years is contrary to doctrine of
AIR 1973 SC 2520
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legitimate expectation.
One of the major contentions of learned Additional Advocate
General is that G.O.Ms.No.635 dated 02.07.1990 has enhanced the
powers of Commissioner of Land Revenue and the District Collector
for disposal of land to different bodies wherein the District
Collector is empowered to dispose land to companies, private
associations and private corporations and private individuals for
which market value of Rs.l0,000/- and Ac.0.25 cts or 0.10 guntas
whichever is less. Prior to the said G.O. the District Collector was
competent to dispose the land to private individuals where the
market value does not exceed Rs.1,000/-. As such, in the present
case, the then District Collector has ordered for advance
possession of land to the petitioner to an extent of Ac.63.50
cts which is beyond the powers vested on him. Handing over
advance possession of subject matter of land to the petitioner is
governed by BSO-24 and therefore, the petitioner cannot contend
that the delivery of possession in his favour amounts to a
Government Grant within the meaning of Government Grant under
the Government Grants Act, 1895 and hence, the provisions of
the Government Grants Act are not applicable. In this case, the then
District Collector had no power to give advance possession for such
an extent of land.
Learned Additional Advocate General relied on "M/s. Motilal
Padampat Sugar Mills Co.Limited v. State of Uttar Pradesh"
(referred supra) in support of his contentions. There is no dispute
with regard to the principle laid down in "M/s. Motilal Padampat
Sugar Mills Co.Limited v. State of Uttar Pradesh" (referred
supra). The Apex Court in "Shabi Construction Company v. City
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and Industrial Development Corporation14" as well as in "Pune
Municipal Corporation v. Promoters and Builders Association15"
consistently held that doctrine of promissory estoppels cannot be
invoked to compel the public bodies or the Government to carry out
a promise which is contrary to law. Taking advantage of the
principle laid down in the said judgments, learned Additional
Advocate General contended that as the allotment was made in
contravention of BSO 24, the State cannot be compelled to perform
its promise.
The law laid down in the above judgments is not in quarrel,
but the A.P. Board Revenue Standing Orders have statutory basis,
and the enforceability of the Board Standing Orders was considered
by the Division Bench of the High Court of Andhra Pradesh in the
case of "Kanumuri Anji Raju v. State of Andhra Pradesh16",
candidly held that the Standing Orders are merely executive
instructions issued for the guidance of officers who are to carry out
the policy of the Government.
The said principle was reiterated by the learned single Judge of
the High Court of Andhra Pradesh in "Smt. C. Rajamma v The
District Collector17".
Further, a learned single Judge of this Court in the case of
"Katta Rattamma v. Gannamaneni Kotaiah18" held that the
Standing Orders are only administrative instructions and they do not
have any statutory force, or force of law.
(1995) 4 SCC 301
(2004) 10 SCC 796
1960 (2) An.W.R. 272 (D.B.)
1995 (1) ALT 681
1975 (2) An.W.R. 122
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Therefore, standing orders are not having legal enforceability
and they are only guidelines for the purpose of administration.
Hence, it is difficult to sustain the contention of learned Additional
Advocate General that the allotment was in contravention of the law
and the Court cannot direct the State to perform its promise made in
the letter of allotment during pendency of alienation proceedings, is
rejected. However, in "Shabi Construction Company v. City and
Industrial Development Corporation" and "Pune Municipal
Corporation v. Promoters and Builders Association" (referred
supra), it is made clear that if the promise of the State is in
contravention of law, the State cannot be compelled to perform the
same. Law means a law made by State legislature or Parliament, as
such the above judgments have no direct bearing on the issue to
deny the relief as the Andhra Pradesh Revenue Board Standing
Orders are not the law made by either Parliament or the State
legislature.
Learned Additional Advocate General relied on the judgment of
the Apex Court in "Union of India v. M/s. V.V.F.Ltd.19", wherein the
Apex Court referred to the principle laid down in "Kasinka Trading
v. Union of India (UOI)20", which is as follows:
"It has been settled by this Court that the doctrine of promissory
estoppel is applicable against the Government also particularly where it is
necessary to prevent fraud or manifest injustice. The doctrine, however,
cannot be pressed into aid to compel the Government or the public authority
"to carry out a representation or promise which is contrary to law or which
was outside the authority or power of the officer of the Government or of the
public authority to make". There is preponderance of judicial opinion that to
invoke the doctrine of promissory estoppel clear, sound and positive
foundation must be laid in the petition itself by the party invoking the
doctrine and that bald expressions, without any supporting material, to the
AIR 2020 SC 2954
(1995) 1 SCC 274
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effect that the doctrine is attracted because the party invoking the doctrine
has altered its position relying on the assurance of the Government would
not be sufficient to press into aid the doctrine. In our opinion, the doctrine of
promissory estoppel cannot be invoked in the abstract and the courts are
bound to consider all aspects including the results sought to be achieved and
the public good at large, because while considering the applicability of the
doctrine, the courts have to do equity and the fundamental principles of
equity must for ever be present to the mind of the court, while considering
the applicability of the doctrine. The doctrine must yield when the equity so
demands if it can be shown having regard to the facts and circumstances of
the case that it would be inequitable to hold the Government or the public
authority to its promise, assurance or representation."
The doctrine of promissory estoppel can be applied in narrow
sense, whereas a wider connotation of doctrine of legitimate
expectation is applicable to the present facts of the case.
One of the contentions of the learned counsel for the petitioner
is that the respondents have violated their promise to finalise the
process of alienation while permitting the petitioner to raise massive
constructions to run educational institutions. On the basis of
doctrine of legitimate expectation by a citizen, the respondents are
not competent to resume the land. In the recent judgment, in "the
State of Jharkhand v. Brahmputra Metallics Ltd., Ranchi21" the
Hon‟ble Apex Court drawn the distinction between the "doctrine of
promissory estoppel" and "doctrine of legitimate expectation". After
referring to entire law on the doctrine of legitimate expectation and
promissory estoppel relying on the "State of Bihar v. Kalyanpur
Cement Limited22", and "Motilal Padampat Sugar Mills Co. Ltd.
v. State of Uttar Pradesh" (referred supra) concluded that doctrine
of promissory estoppel will not give raise to cause of action, but
doctrine of legitimate expectation will give raise to cause of action.
2021 (1) SCJ 131
(2010) 3 SCC 274
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The common law recognizes various kinds of equitable
estoppel, one of which is promissory estoppel. In Crabb v Arun DC23
Lord Denning, speaking for the Court of Appeal, traced the genesis of
promissory estoppel in equity, and observed:
"The basis of this proprietary estoppel - as indeed of promissory
estoppel - is the interposition of equity. Equity comes in, true to
form, to mitigate the rigours of strict law. The early cases did not
speak of it as "estoppel". They spoke of it as "raising an equity" If
I may expand that, Lord Cairns said: "It is the first principle
upon which all Courts of Equity proceed", that it will prevent a
person from insisting on his legal rights - whether arising under
a contract or on his title deed, or by statute - when it would be
inequitable for him to do so having regard to the dealings which
have taken place between the parties."
The requirements of the doctrine of promissory estoppel have
also been formulated by Hugh Beale in Chitty on Contracts (32nd
Edition Sweet & Maxwell 2017).
"4.086. For the equitable doctrine to operate there must be a
legal relationship giving rise to rights and duties between the
parties; a promise or a representation by one party that he
will not enforce against the other his strict legal rights arising
out of that relationship; an intention on the part of the former
party that the latter will rely on the representation; and such
reliance by the latter party. Even if these requirements are
satisfied, the operation of the doctrine may be excluded if it
is, nevertheless, not "inequitable" for the first party to go
back on his promise. The doctrine most commonly applies to
promises not to enforce contractual rights, but it also extends
to certain other relationships.
4.088.....The doctrine can also apply where the relationship
giving rise to rights and correlative duties is non-contractual:
e.g. to prevent the enforcement of a liability imposed by
statute on a company director for signing a bill of exchange
on which the company's name is not correctly given; or to
prevent a man from ejecting a woman, with whom he has
been cohabitating, from the family home."
Chitty on Contracts, clarifies that the doctrine of promissory
estoppel may be enforced even in the absence of a legal relationship.
Generally speaking under English Law, judicial decisions have in the
past postulated that the doctrine of promissory estoppel cannot be
3 [1976] 1 Ch 179 (Court of Appeal)
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used as a „sword‟, to give rise to a cause of action for the enforcement
of a promise lacking any consideration. Its use in those decisions has
been limited as a „shield‟, where the promisor is estopped from
claiming enforcement of its strict legal rights, when a representation
by words or conduct has been made to suspend such rights. In
"Combe v Combe24" the Court of Appeal held that consideration is
an essential element of the cause of action:
"It [promissory estoppel] may be part of a cause of action, but not a
cause of action itself.
.....
The principle [promissory estoppel] never stands alone as giving a
cause of action in itself, it can never do away with the necessity of
consideration when that is an essential part of the cause of action. The
doctrine of consideration is too firmly fixed to be overthrown by a side-
wind."
Even within English Law, the application of the rule laid down
in Combe (referred supra) has been noticed to be inconsistent. The
scope of the rule has also been doubted on the ground that it has
been widely framed. Hence, in the absence of a definitive
pronouncement by the House of Lords holding that promissory
estoppel can be a cause of action, a difficulty was expressed in
stating with certainty that English Law has evolved from the
traditional approach of treating promissory estoppel as a „shield‟
instead of a „sword‟. By contrast, the law in the United States and
Australia is less restrictive in this regard.
Under English Law, the doctrine of legitimate expectation
initially developed in the context of public law as an analogy to the
doctrine of promissory estoppel found in private law. However, since
then, English Law has distinguished between the doctrines of
promissory estoppel and legitimate expectation as distinct remedies
under private law and public law, respectively. De Smith‟s Judicial
[1951] 2 K.B. 215
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Review25 noted the contrast between the public law approach of the
doctrine of legitimate expectation and the private law approach of the
doctrine of promissory estoppel:
"[d]espite dicta to the contrary [Rootkin v Kent CC, (1981) 1 WLR
1186 (CA); R v Jockey Club Ex p RAM Racecourses Ltd, [1993]
AC 380 (HL); R v IRC Ex p Camacq Corp, (1990) 1 WLR 191 (CA)],
it is not normally necessary for a person to have changed his
position or to have acted to his detriment in order to qualify as
the holder of a legitimate expectation [R v Ministry for
Agriculture, Fisheries and Foods Ex p Hamble Fisheries
(Offshore) Ltd, (1995) 2 All ER 714 (QB)]. . . Private law analogies
from the field of estoppel are, we have seen, of limited relevance
where a public law principle requires public officials to honour
their undertakings and respect legal certainty, irrespective of
whether the loss has been incurred by the individual concerned
[Simon Atrill, „The End of Estoppel in Public Law?‟ (2003) 62
Cambridge Law Journal 3]."
Another difference between the doctrines of promissory
estoppel and legitimate expectation under English Law is that the
latter can constitute a cause of action. The scope of the doctrine of
legitimate expectation is wider than promissory estoppel because it
not only takes into consideration a promise made by a public body
but also official practice, as well. Further, under the doctrine of
promissory estoppel, there may be a requirement to show a
detriment suffered by a party due to the reliance placed on the
promise. Although typically it is sufficient to show that the promisee
has altered its position by placing reliance on the promise, the fact
that no prejudice has been caused to the promisee may be relevant
to hold that it would not be "inequitable" for the promisor to go back
on their promise. However, no such requirement is present under
the doctrine of legitimate expectation. In Regina (Bibi) v Newham
London Borough Council26, the Court of Appeal held:
"55 The present case is one of reliance without concrete
detriment. We use this phrase because there is moral detriment,
which should not be dismissed lightly, in the prolonged
Harry Woolf and others, De Smith's Judicial Review (8th edn, Thomson Reuters 2018).
[2002] 1 W.L.R. 237
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disappointment which has ensued; and potential detriment in the
deflection of the possibility, for a refugee family, of seeking at the
start to settle somewhere in the United Kingdom where secure
housing was less hard to come by. In our view these things
matter in public law, even though they might not found an
estoppel or actionable misrepresentation in private law, because
they go to fairness and through fairness to possible abuse of
power. To disregard the legitimate expectation because no
concrete detriment can be shown would be to place the weakest
in society at a particular disadvantage. It would mean that those
who have a choice and the means to exercise it in reliance on
some official practice or promise would gain a legal toehold
inaccessible to those who, lacking any means of escape, are
compelled simply to place their trust in what has been
represented to them."
Consequently, while the basis of the doctrine of promissory
estoppel in private law is a promise made between two parties, the
basis of the doctrine of legitimate expectation in public law is
premised on the principles of fairness and non-arbitrariness
surrounding the conduct of public authorities. This is not to suggest
that the doctrine of promissory estoppel has no application in
circumstances when a State entity has entered into a private
contract with another private party. Rather, in English law, it is
inapplicable in circumstances when the State has made
representation to a private party, in furtherance of its public
functions.
Under Indian Law, there is often a conflation between the
doctrines of promissory estoppel and legitimate expectation. This has
been described in Jain and Jain‟s well known treatise, Principles of
Administrative Law27.
"At times, the expressions „legitimate expectation‟ and
„promissory estoppel‟ are used interchangeably, but that is not a
correct usage because „legitimate expectation‟ is a concept much
broader in scope than „promissory estoppel‟. ...
A reading of the relevant Indian cases, however, exhibit some
confusion of ideas. It seems that the judicial thinking has not as
yet crystallised as regards the nature and scope of the doctrine.
At times, it has been referred to as merely a procedural doctrine;
at times, it has been treated interchangeably as promissory
M.P. Jain and S.N. Jain, Principles of Administrative Law (7th edn., EBC 2013).
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estoppel. However both these ideas are incorrect. As stated above,
legitimate expectation is a substantive doctrine as well and has
much broader scope than promissory estoppel.
In Punjab Communications Ltd. v. Union of India, the Supreme
Court has observed in relation to the doctrine of legitimate
expectation: "the doctrine of legitimate expectation in the
substantive sense has been accepted as part of our law and that
the decision maker can normally be compelled to give effect to his
representation in regard to the expectation based on previous
practice or past conduct unless some overriding public interest
comes in the way Reliance must have been placed on the said
representation and the representee must have thereby suffered
detriment." It is suggested that this formulation of the doctrine of
legitimate expectation is not correct as it makes "legitimate
expectation" practically synonymous with promissory estoppel.
Legitimate expectation may arise from conduct of the authority; a
promise is not always necessary for the purpose."
While this doctrinal confusion has the unfortunate
consequence of making the law unclear, citizens have been the
victims. Representations by public authorities need to be held to
scrupulous standards, since citizens continue to live their lives
based on the trust they repose in the State. In the commercial world
also, certainty and consistency are essential to planning the affairs
of business. When public authorities fail to adhere to their
representations without providing an adequate reason to the citizens
for this failure, it violates the trust reposed by citizens in the State.
The generation of a business friendly climate for investment and
trade is conditioned by the faith which can be reposed in government
to fulfil the expectations which it generates. Professors Jain and
Deshpande characterize the consequences of this doctrinal
confusion in the following terms:
"Thus, in India, the characterization of legitimate
expectations is on a weaker footing, than in jurisdictions
like UK where the courts are now willing to recognize the
capacity of public law to absorb the moral values
underlying the notion of estoppels in the light of the
evolution of doctrines like LE [Legitimate Expectations] and
abuse of power. If the Supreme Court of India has shown
its creativity in transforming the notion of promissory
estoppel from the limitations of private law, then it does not
stand to reason as to why it should also not articulate and
evolve the doctrine of LE for judicial review of resilement of
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administrative authorities from policies and longstanding
practices. If such a notion of LE is adopted, then not only
would the Court be able to do away with the artificial
hierarchy between promissory estoppel and legitimate
expectation, but, it would also be able to hold the
administrative authorities to account on the footing of
public law outside the zone of promises on a stronger and
principled anvil. Presently, in the absence of a like doctrine
to that of promissory estoppel outside the promissory zone,
the administrative law adjudication of resilement of policies
stands on a shaky public law foundation."
The need for this doctrine to have an independent existence
was articulated by Justice Frankfurter of the United State Supreme
Court in Vitarelli v. Seton28 as follows:
"An executive agency must be rigorously held to the standards by
which it professes its action to be judged. Accordingly, if dismissal
from employment is based on a defined procedure, even though
generous beyond the requirements that bind such agency, that
procedure must be scrupulously observed. This judicially evolved
rule of administrative law is now firmly established and, if I may
add, rightly so. He that takes the procedural sword shall perish
with the sword."
Thus, the Court held that the doctrine of legitimate expectation
cannot be claimed as a right in itself, but can be used only when the
denial of a legitimate expectation leads to the violation of Article 14
of the Constitution.
The Apex Court in The State of Jharkhand v. Brahmputra
Metallics Ltd. (referred supra) by relying on earlier judgments of the
Apex Court, concluded that the respondent is entitled to
rebate/deduction from electricity duty and affirmed the order passed
by the High Court on the ground that the State violated its promise
and legitimate expectation. Here, attempt to resume the land is in
violation of expectation of petitioner on account of promise and the
359 US 535 (1959)
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petitioner will suffer substantial loss in case of resumption, such
proposed resumption can be held to be arbitrary.
Proprietary estoppel is a legal claim, especially connected
to English land law, which may arise in relation to rights to use the
property of the owner, and may even be effective in connection with
disputed transfers of ownership. Proprietary estoppel transfers rights
if, someone is given a clear assurance that they will acquire a right
over property, they reasonably rely on the assurance, and, they act
substantially to their detriment on the strength of the assurance it
would be unconscionable to go back on the assurance. If these
elements of assurance, reliance and detriment, and
unconscionability are present, the usual remedy will be that the
property will be transferred to the claimant, if the court views the
reliance to warrant a claim in all the circumstances.
The Delhi High Court in "Raj Kishan Dass v. Mrs. Kusum
Singh29" considered the Scope of Proprietary Estoppel, wherein it
was observed that, Proprietary estoppel operates in a variety of cases
to disparate that it has been described as "an amalgam of doubtful
utility". The cases can be divided broadly into two categories. In the
first, one person acts under a mistake as to the existence or as to the
extent of his rights in or over another's land. Even though the
mistake was in no way induced by the landowner, he might be
prevented from taking advantage of it. Particularly if he "stood by"
knowing of the mistake, or actively encouraged the mistaken party to
act in reliance on his mistaken belief. These cases of so-called
"acquiescence" do not raise any questions as to the enforceability of
promises and therefore do not call for further discussion. In the
93 (2000) DLT 359
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Second situation, there is not merely "acquiescence" by the
landowner, but "encouragement". The other party acts in reliance on
the landowner's promise (or on conduct or a representation from
which a promise can be inferred) that the promise has a legally
recognized interest in the land or that one will be created in his
favor. The question then arises, to what extent such a promise can
be enforced, even though it may not be supported by consideration,
or fail to satisfy the other requirements (such as certainty) of a
binding contract. The present facts would attract the second
situation as reliance on the terms made by the State, the
Government entered into a contract and delivered possession of the
land which was converted into non-agriculture and development
activities were taken place. Therefore, the petitioner is entitled to
insist the State to perform its obligation based on the Principle of
Proprietary Estoppel, as the petitioner altered its position like
Promissory Estoppel, since it is an Equitable Doctrine, the Courts
have to interpret the same and applying the principle to the facts on
hand and extend the benefit to the concerned.
The Supreme Court in "A.P Transco v. Sai Renewable Power
Pvt.Ltd30" referred to use of promissory estoppel as a basis of cause
of action and held as follows:
"It is a settled canon of law that doctrine of promissory
estoppel is not really based on principle of estoppel but is a
doctrine evolved by equity in order to prevent injustice
There is no reason why it should be given only a limited
application by way of defence. It can also be the basis of a
cause of action."
In view of the principle laid down by the Apex Court, the
petitioner being an allottee expected that the State would fulfil its
(2011) (11) SCC 34
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obligation i.e. completion of alienation process. Instead of doing so,
after 39 years, in violation of its obligation trying to resume the
unutilised land though there was no such condition for resumption.
Therefore, the act of the respondents to the extent of proposed
resumption of unutilised land allotted under the grant is in violation
of doctrine of legitimate expectation.
Sri Ponnavolu Sudhakar Reddy, learned Additional Advocate
General, would contend that the allotments are governed by BSO 24
and a grant was made in contravention of BSO 24, it cannot be said
to be a legal, thereby such illegal act of the of the Collector would not
enure any benefit to the petitioner to claim any right in the property
or question the proposed resumption of unutilised land. He placed
reliance on the judgment of the High Court of Andhra Pradesh at
Hyderabad in "Road Metal Industry v. Secretary to Government
of A.P." (referred supra), wherein the Government intend to allot the
land for different purpose by the side of Highway, then the Court
took note of specific allegation made in the counter by the State,
where the State contended that "basically, the Government being the
owner of the land can allot it for any purpose, which is conducive to
the welfare of the State. There are also some statutory provisions,
which provided inter alia for such assignment e.g. Board‟s Standing
Order No.24. Further, under the Rules framed under A.P. (Telangana
Area) Grant of Lease of Lands for Non-Agricultural Purposes Rules,
1977 under the A.P.(Telangana Area) Land Revenue Act, 1317 Fasli
leases of Government lands in Telangana area may be granted on
payment of rent or even free of rent."
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The Court discussed several aspects as to the policy of the
Government for allotment and finally concluded as follows:
"The government owns and controls vast extents of public land. The
Constitution makers wanted that the ownership of the material resources of
the community should be so made available to subserve the common good.
The government is not like a private individual who can deal with his
property in whatsoever manner. The government cannot pick and choose the
person with whom it will deal, since the government is still a government
when it is administering largesse and that it cannot, without adequate
reason either distribute or take away the largesse arbitrarily. It is too
elementary to reiterate the distinction between the public and private power.
In a decent society governed by rule of law and constitutionalism, it is
unthinkable that the government, or any officer or authority of the
government, possesses arbitrary power over the person or property including
its own properties. There is nothing like unlimited discretion conferred upon
the government or any of its authorities to deal with the government
properties in accordance with one's own choice. May be, discretionary power
is necessary to solve particular problems. It may be a toot, indispensable for
individualisation of justice. But such discretion must be confined within
clearly defined limits. Meaningful statutory standards and realistic
procedural requirements are among the tools to control the discretionary
power."
In the said judgment, learned single Judge relied on the
judgment of the Apex Court in "Jaisinghani v. Union of India31",
wherein it is observed as follows:
"The absence of arbitrary power is the first essential of the rule of law
upon which our whole constitutional system is based. In a system governed
by rule of law, discretion, when conferred upon executive authorities, must
be confined within clearly defined limits. The rule of law from this point of
view means that decisions should be made by the application of known
principles and rules and, in general, such decisions should be predictable
and the citizen should know where he is. If a decision is taken without any
principle or without any rule it is unpredictable and such a decision is the
antithesis of a decision taken in accordance with the rule of law."
In "Road Metal Industry v. Secretary to Government of
A.P." (referred supra) the learned Single Judge further held as
follows:
"The Alienation Rules as well as the Lease Rules prescribe meaningful
statutory standards and realistic procedural requirements to be followed by
AIR 1967 SC 142
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the government and its officers in the matter of disposal/alienation/grant of
lease of government lands. Such meaningful statutory standards are
prescribes in order to avoid the risk of possible arbitrary use of discretionary
power. Those rules are mandatory in nature. The alienation of the
government lands or the lease of the same, as the case may be, in Telangana
Area of the State of Andhra Pradesh is to be inconformity with the prescribed
standards under the rules referred to hereinabove. Any decision by the
authority or the government contrary to the said rules may have to be
declared ultra vires. The power to alienate the government lands can be
exercised only inconformity with the rules. The wide powers of the State and
the discretion vested in the authority required them to be exercised in a fair
manner and, the surest mode of exercise of power fairly is by following and
observing the procedures prescribed by the statute or the rules, as the case
may be. The observance of the procedure is not a matter of secondary
importance. The procedural fairness and regularity have been the great
bastion against arbitrariness.
The procedural requirements have not been followed at any stage by any
of the authorities. The statutory rules are altogether ignored. The decision
has resulted in public mischief. This court, when such public mischief is
exposed, cannot refuse to interfere on the ground that such exposure is by a
petitioner to whom no relief could be granted. The petitioner may not get any
relief for itself. The petitioner may not have any right in the land in question.
Lease may not be extended in its favour. But, those factors do not constitute
any ground to uphold the ex facie illegal and improper decision of the
government to allot its valuable land to respondents 5 and 6."
Taking advantage of the said principle, Sri Ponnavolu
Sudhakar Reddy, learned Additional Advocate General would submit
that when the procedural requirements have not been followed, the
statutory rules are altogether ignored, the decision has resulted in
public mischief. Thereby, the grant in favour of the petitioner, which
is in violation of BSO 24 cannot be legalised and the State cannot be
prevented from resuming part of unutilised land under notice
impugned in the writ petition.
In the present facts of the case, grant in favour of the
petitioner is for establishment of educational institutions initially
Nyaya Vidya Parishad (National Law School) and Sanketika Vidya
Parishad (Engineering college). Later, permission was granted for
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utilising the land for general education also. Accordingly,
establishment of educational institutions are for public purpose and
to cater the educational needs of various students prosecuting their
studies in the area of Srikakulam, Vizianagaram, Visakhapatnam
and other districts of Andhra Pradesh. Providing education to the
students is nothing but public interest and such allotment is only to
serve public purpose. As discussed above, though the land was
allotted by Collector during pendency of alienation process, the same
is not governed by BSO 24, for the reason that A.P. Revenue Board
Standing Order is only a guideline for administrative convenience
and not law made by the State legislature or parliament. Therefore,
allotment of land in contravention of BSO 24 cannot be said to be
illegal. Actually, State used to frame guidelines known as "land
allotment policy" and being changed from time to time, based on
such allotment policy, the Government authorising authorities under
its control to allot the property. The allotment was made during
1983, the then "land allotment policy" of the State is the basis for
such allotment, but either the learned senior counsel for the
petitioner or Sri Ponnavolu Sudhakar Reddy, learned Additional
Advocate General appearing for the respondents not placed the same
for perusal, at least to examine whether the allotment is in
consonance with the land allotment policy of the State. In any view of
the matter, when the allotment is Government Grant as discussed in
earlier paragraphs, it is totally governed by Section 3 of the
Government Grants Act, which is as follows:
"3. Government grants to take effect according to their tenor - All
provisions, restrictions, conditions and limitations over contained in any
such grant or transfer as aforesaid shall be valid and take effect according to
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their tenor, any rule of law, statute or enactment of the Legislature to the
contrary notwithstanding."
As discussed above, when the Grant is made by the
Government, it is governed by tenor of its contents and not any other
law.
At the same time, the Government is under obligation to take
care of every direction/guidelines issued by the Apex Court while
allotting land to different persons. Therefore, the grant made in
favour of the petitioner made by the State is not governed by BSO 24
and it is governed by the Government Grants Act and the then State
land allotment policy. Learned Additional Advocate General could not
bring to my notice about the violation of any of the conditions of the
then land allotment policy of the State. In fact, it was not his case at
any stage. Therefore, the contention of learned Additional Advocate
General that the allotment is in contravention of the provisions of the
BSO 24 is hereby rejected while holding that the allotment is
governed by the Government Gants Act. Accordingly, the point is
answered in favour of the petitioner against the respondents while
holding that the respondent - State cannot resume the un-utilised
part of land and on the other hand the State is directed to complete
the process of alienation within four (4) months from today.
P O I N T No.2:
One of the major contentions raised by the learned senior
counsel for the petitioner before this Court is that the land was
allotted on payment of the market value existing in the year 1981.
Since the alienation process is not completed, the market value was
not collected from the petitioner. Thereupon, the petitioner
approached this Court, filed W.P.No.11433 of 1995 where a direction
was issued by the High Court of Judicature at Hyderabad, without
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touching the merits of the case, to finalise alienation proposals
within a period of three (3) months from the date of the order in
W.P.No.11433 of 1995. Though, the State suffered order, which
attained finality, obviously for the reasons best known to the State
did not implement the order till date. But in utter violation of
direction issued by the High Court of Judicature at Hyderabad in
W.P.No.11433 of 1995, now, the State is proposing to resume the
land and demanding the present market value from the petitioner,
but none of the documents placed on record would show that the
allotment was made subject to payment of market value as on the
date of alienation or that the respondent/State is demanding to pay
the present market value. Therefore, demanding payment of market
value by the respondents as on date is not based on any material,
even otherwise there is no condition for payment of market value in
the allotment letter or delivery letter. The allotment must be based
on the market value as on the date of allotment, but not on the date
of alienation. Since the petitioner raised massive constructions as
shown in the table in the earlier paragraphs, on the basis of the
promise made by the State to complete alienation, the State is
demanding to pay market value in view of the hike in price of the
land value within the Visakhapatnam District. Therefore, insisting
the petitioner to pay present market value with a threat to resume
the land is contrary to the promise made by the State to the
petitioner and the same is illegal and arbitrary.
Sri Vedula Venkata Ramana, learned senior counsel for the
petitioner would contend that when an allotment was made by the
United State of Andhra Pradesh, after its bifurcation, residuary State
of Andhra Pradesh cannot deny its liability to perform its obligation.
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He placed reliance on the Full Bench Judgment of the Apex Court in
"State of Punjab v. Balbir Singh" (referred supra), wherein the
Apex Court analysed the meaning of "law" with reference to Section 2
(g) of the Punjab State Reorganisation Act, which is as follows:
Law is defined in Clause (g) of Section 2 of the Act to say:
'law" includes any enactment, ordinance, regulation, order, bye-law,
rule, scheme, notification or other instrument having, immediately before the
appointed day, the force of law in the whole or in any part of the existing
State of Punjab
In the facts of the said judgment, the Apex Court considered
the effect of Section 82 (1) of the Panjab State Reorganisation Act
with reference to benefits payable to the employees and concluded as
follows:
"Section 88 appears to have been introduced as a matter of abundant
caution. In my opinion, mere splitting up of the territories of Punjab into four
successor States would not ipso facto result in the abrogation or repeal of the
laws which were immediately in force before the appointed day in those
territories. There is nothing in the 1966 Act, not even in Section 88, which
expressly or by necessary intendment repeals the laws which were in force
immediately before the appointed day in the territories of the former Punjab.
Those laws derived their force de hors the 1966 Act. The first part, of Section
88 is merely clarificatory of any doubts which might arise as a result of the
reorganisation of Punjab, while the latter part of this section is merely an
adaptative provision, to the effect, that the territorial references in any such
law to the State of Punjab shall continue to mean the territories within that
State immediately before the appointed day. Thus, read as a whole Section
88 merely dispel doubts as to the continuity of the laws which wore in force
before the appointed day in the former State of Punjab, until the competent
legislature or authority of the successor States effects any change in those
laws."
In view of the principle laid down in the above judgment, the
successor State is bound to perform the promise made by it before
bifurcation. Similar provisions are incorporated in the Andhra
Pradesh Reorganisation Act. The "law" is defined under Section 2 (f)
of the Andhra Pradesh Reorganisation Act, which is as follows:
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2 (f) 'law" includes any enactment, ordinance, regulation,
order, bye-law, rule, scheme, notification or other instrument having,
immediately before the appointed day, the force of law in the whole
or in any part of the existing State of Andhra Pradesh.
Thus, the definition under Section 2 (g) of the Punjab State
Reorganisation Act is in pari materia to Section 2 (f) of the Andhra
Pradesh Reorganisation Act. Similarly, Section 100 of the A.P.
Reorganisation Act deals with territorial extent of laws, which is
similar to Section 88 of the Punjab Reorganisation Act. At the same
time, Section 100 of the A.P.Reorganisation Act corresponds to
Section 53 of the Andhra State Act 1953 and Section 119 of States
Reorganisation Act, 1956, Section 87 of Bombay reorganization Act,
Section 88 of Punjab Reorganisation Act, Section 84 of Bihar
Reorganisation, Section 78 of MP Reorganisation Act, and Section 86
of UP Reorganisation Act. Such provisions are enacted to maintain
continuity, and at the same time authorise the States to make such
modifications and adaptations as are considered necessary by mere
issuance of orders within two years, and thereafter by legislation or
exercise of power by the competent authority. Such provisions have
necessarily to be incorporated in legislations relating to
reorganization of States. It is, therefore, appropriate that such
legislations must be construed in the light of the unusual situation
created by the creation of a new State and the object sought to be
achieved.
Section 88 of the Punjab Reorganisation Act fell for
consideration in the above judgment, which is similar to Section 100
of the A.P. State Reorganisation Act, where the Apex Court agreed
with the High Court that the impugned orders therein are not law
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within the meaning of Section 2(g) of the Punjab Reorganisation Act
as they were not saved by Section 88 of the Punjab High Court.
However, the Court held that when there is no change of sovereignty
and it is merely an adjustment of territories by the reorganization of
a particular State, the administrative orders made by the
Government of the erstwhile State continue to be in force and
effective and binding on the successor States until and unless they
are modified, changed or repudiated by; the Governments of the
successor States. The Court further observed that no other view is
possible to be taken. The other view will merely bring about chaos in
the administration of the new States. The Apex Court found no
principle in support of the stand that administrative orders made by
the Government of the erstwhile State automatically lapsed and were
rendered ineffective on the coming into existence of the new
successor States. It is well established that when one State is
absorbed in another, whether by accession, conquest, merger or
integration, all contracts of service between the prior Government
and its servants automatically terminate and thereafter those who
elect to serve in the new State, and are taken on by it, serve on such
terms and conditions as the new State may choose to impose.
If these principles are applied to the present facts of the case,
the decision taken by the United State of Andhra Pradesh was not
modified by any law by the Successor State. Therefore, the successor
state of Andhra Pradesh is bound to honour the decisions taken by
common State of Andhra Pradesh and implement the
orders/decisions taken by the common State in view of the law laid
down by the Apex Court in "State of Punjab v. Balbir Singh"
(referred supra).
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One of the contentions raised by Sri P.Sudhakar Reddy,
learned Additional Advocate General is that the writ petition is not
maintainable as there are disputed questions of fact to be considered
by this Court. In support of his contentions, he placed reliance on
the judgment of the learned single Judge of this Court in
"S. Lingamaiah v. State of A.P." (referred supra), wherein the
Court while considering the facts before it, framed a point whether
writ petition against a mere show-cause notice is maintainable and
whether disputed questions of fact relating to the title of a property
can be gone into in a proceeding under Article 226 of the
Constitution of India? Learned single Judge of the High Court of
Andhra Pradesh relied on various judgments, recorded specific
findings based on the facts of the case.
The principle laid down in the above judgment is
distinguishable on facts for the reason that here the petitioner
questioned the impugned letter issued for the purpose of resumption
of land. But the allotment, delivery of possession, allowing the
petitioner to raise constructions, running educational institutions
granting permission etc., are not in dispute. Therefore, it is not the
case, where the disputed questions of facts as to title can be gone
into by this Court, the impugned notice is only an administrative
decision and the same is challenged before this Court in the writ
petition. Hence, the principle laid down in "S. Lingamaiah v. State
of A.P." (referred supra), has no application to the present facts of
the case. Hence, I find that the State is under obligation to
implement its decision to alienate the property both on the principle
of legitimate expectation and that the grant is Government grant
governed by the Government Grants Act and not by A.P.Board
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Revenue Standing Orders, which are in the nature of administrative
guidelines. At the same time, State is not entitled to collect market
value prevailing as on date after 39 years (approximately) and not
entitled to resume the land after completion of 39 years as the
petitioner is running educational institutions for public purpose and
to cater the needs of the youth, who are prosecuting their studies
and apart from that the proposed resumption is not in the public
interest. Accordingly, the point is answered in favour of the petitioner
and against the respondents.
In the result, the petition is allowed declaring the action of the
respondents in not alienating the allotted land admeasuring
Ac.63.50 cents situated in Sy.Nos.60/1 to 60/5, 61/1 to 61/7 of
Pothina Mallayya Palem and Sy.No.364/1, 364/2 Madhurawada
villages of Visakhapatnam Mandal and District despite delivery of
possession of the said land in the year 1981 to the petitioner and the
initiation of proceedings for resumption of the land from the
petitioner is illegal and arbitrary while directing the State to complete
the process of alienation within four (4) months from today strictly
adhering to the allotment letter. No costs.
Consequently, miscellaneous applications pending if any, shall
also stand dismissed.
_________________________________________
JUSTICE M. SATYANARAYANA MURTHY
27.07.2021
Ksp
