State Of Andhra Pradesh vs Lalitesh Kumar Katragadda,
2023 Latest Caselaw 2999 AP

 IN THE HIGH COURT OF ANDHRA PRADESH: AMARAVATI

HON'BLE MR. JUSTICE PRASHANT KUMAR MISHRA, CHIEF JUSTICE
                            &
         HON'BLE MR. JUSTICE R. RAGHUNANDAN RAO

                 WRIT APPEAL No.257 of 2023
                        (Through physical mode)

State of Andhra Pradesh
Revenue (Urban and Land Ceiling) Department,
Secretariat, Velagapudi, Amaravathi,
Guntur District,
Rep.by its Principle Secretary and others.          ...Appellants

    Versus

Lalitesh Kumar Katragadda,
S/o.K.S.K.Prasad, aged about 48 years,
Occ:Business, R/o.15-12-15, 1st floor,
Kalyan Rachakonda Residency,
Near Krishna Temple,
Krishna Nagar, Maharanipeta,
Visakhapatnam District.                           ...Respondent


                            JUDGMENT

Dt: 10.05.2023 (per Hon'ble Sri Justice R.Raghunandan Rao)

One Sri J. Bhuvaneshwar Das was the owner of Ac.0.82

cents of land in Sy.No.81/1 and Ac.6.00 cents of land in

Sy.No.81/3 of Marripalem, Visakhapatnam. A large part of the

land had been declared as surplus land, under the Urban Land

(Ceiling and Regulation) Act. This Act was subsequently repealed

by the Urban Land (Ceiling and Regulation) Repealed Act, 1999.

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In April 2008, the State Government adopted the said Repeal

Act. After the Repeal Act had come into force, the Government

issued G.O.Ms.No.747 Revenue (UC.I) Department, dated

18.06.2008 for allotment of surplus land, declared under the

Urban Land Ceiling Act, to the land owners/3 rd parties who had

acquired rights over these lands, subject to certain guidelines

and conditions mentioned in the G.O., and upon payment of

money payable under the terms of the said G.O.

2. The legal heirs and family members of Sri J.

Bhuvaneshwar Das had filed applications under G.O.Ms.No.747,

for allotment of the land declared as surplus. The Special

Officer, Urban Land Ceiling, Visakhapatnam had sent his

reports relating to the applications made by the legal heirs of Sri

J. Bhuvaneshwar Das. Upon consideration of the said report,

the Government had issued G.O.Ms.No.926 Revenue (UC.I)

Department, dated 31.08.2009 allotting an extent of 20465.10

sq. yards and G.O.Ms.No.123 Revenue (UC.I) Department, dated

31.08.2009 allotting an extent of 2686.1 sq. yards to the legal

heirs of Sri J. Bhuvaneshwar Das, who had applied for such

allotment. The petitioner contends that after this allotment, all

the allottees entered into a registered agreement of sale cum

General Power of Attorney with the petitioner in W.P.No.8280 of

2020 and the petitioner is said to have been put in possession

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and had constructed a compound wall around the entire land

apart from two temporary structures established in the land.

3. One Yellapu Nageswara Rao, claiming to be in

possession of the land, by virtue of an unregistered deed of sale,

had filed W.P.No.5419 of 2011 before the erstwhile High Court of

Andhra Pradesh challenging G.O.Ms.No.926 and for a

consequential direction to regularize the land in his favour and

the other petitioners therein. This writ petition was dismissed

with costs, after levying a fine, with a finding that Sri Y.

Nageswara Rao and other writ petitioners in W.P.No.5419 of

2011 were guilty of contempt of Court. This Court while

dismissing the writ petition had made an observation that it

would be open to the Urban Land Ceiling Authorities to take

action for cancellation of G.O.Ms.No.926 if it is found to have

been obtained by fraud or misrepresentation. Initially the Urban

Land Ceiling Authorities did not take any action against

G.O.Ms.No.926. However, on the representation made by Sri Y.

Nageswara Rao, which was endorsed, to the Urban Land Ceiling

Authorities, by the Hon'ble Minister for Revenue, proceedings

had been initiated for cancellation of G.O.Ms.No.926. Aggrieved

by the same, the vendors of the petitioner had initiated a

contempt case bearing C.C.No.84 of 2014 against Urban Land

Ceiling Authorities. The Government, having realized its

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mistake, had issued Memo No.47786/UC.1/2013 dated

19.04.2014 withdrawing the proceedings initiated on the basis

of the representation of Sri Y. Nageswara Rao.

4. After withdrawing the said proceedings, the Urban

Land Ceiling Authorities again initiated action for cancellation of

G.O.Ms.No.926. A notice was issued to show cause why

G.O.Ms.No.926 should not be cancelled. A detailed explanation,

in reply to the show cause notice, was submitted, on

10.10.2014. A second show cause notice was issued on

25.11.2014 to which an explanation was submitted on

10.12.2014. The 1st respondent having kept quiet for more than

six years, suddenly issued the impugned G.O.Ms.No.115 dated

23.04.2020 cancelling and setting aside G.O.Ms.No.926 dated

31.08.2009. Aggrieved by the said order of cancellation, the

petitioner had approached this Court by way of W.P.No.8280 of

2020 which was allowed by a learned Single Judge on

22.12.2022. The respondent authorities, in the writ petition,

have moved the present Writ Appeal against the said Judgment.

5. The show cause notice dated 25.11.2014, which is

the basis for the order of cancellation in G.O.Ms.No.115 dated

23.04.2020 called upon the petitioner to show cause why

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G.O.Ms.No.926 dated 31.08.2009 should not be cancelled on

the following grounds:

i) G.O.Ms.No.747 dated 18.06.2008, under which the

allotment applications were made, required that the

surplus land holders making such applications should

be in physical possession of the land. However, the

legal heirs of Sri J. Bhuvaneshwar Das, who were

declared as surplus land holders, were not in physical

possession of the land when they filed their

applications under G.O.Ms.No.747.

ii) Para 5 (c) of G.O.Ms.No.747 stated that any allotment

shall be subject to withdrawal of all litigations filed

either by the occupants of the surplus land or surplus

land holder or any other interested person. However,

the applications for allotment were made by the surplus

land holders, even while W.P.No.21315 of 2008,

W.P.No.5166 of 2008 and W.P.No.10974 of 2009 were

pending in the High Court, and this fact was not

brought to the notice of the Government. Apart from

this, even the Special Officer had not mentioned

anywhere in his proposals for regularization, that this

litigation was pending.

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iii) One of the conditions in G.O.Ms.No.747 was that the

entire amounts payable under G.O.Ms.No.747 should

have been paid along with the application. However,

five of the applicants did not pay the requisite amount,

even by the time G.O.Ms.No.926 was issued.

iv) There is prima facie evidence, as per the report of the

Special Officer and competent authority , Urban Land

Ceiling, Visakhapatnam and recommendation of the

District Level Screening Committee, that

G.O.Ms.No.926 was obtained fraudulently and by

misrepresenting the facts.

6. The reply dated 10.12.2014 answered these grounds

in the following manner:

i) Allegations regarding Deficit Fee:

The annexure to G.O.Ms.No.926 itself recorded the deficit

amount, payable under the conditions of G.O.Ms.No.747.

Subsequently, the said deficit amount had been paid by the

applicants. In that view of the matter, the question of

suppression of nonpayment of fee would not arise. The

Government after having permitted the applications to delay

the payment of fees and after having accepted this delayed

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payment cannot use the said ground to cancel

G.O.Ms.No.926.

ii) Allegation of pendency of Writ Petitions being

suppressed:

The Special Officer and Urban Land Ceiling Authority, in

his report submitted in relation to the applications of the

surplus land holders, had specifically referred, in his report,

about the pendency of W.P.No.21315 of 2008 and

W.P.No.5166 of 2008. The reply to the show cause notice also

stated that W.P.No.10974 of 2008, filed by Sri Y. Nageswara

Rao and others, which was disposed of on 25.08.2008 prior to

the issuance of G.O.Ms.No.926, had been wrongly mentioned

as W.P.No.10947 of 2009. The reply also stated that

W.P.No.21315 of 2008 was filed by a 3rd party and not by the

allottees. In any event, no interim direction of any nature, was

given in the said writ petition and it came to be dismissed on

05.12.2009. Similarly, W.P.No.5166 of 2008, filed by the

applicants, had been withdrawn on 09.12.2009 itself. Thus, 3

writ petitions had been disposed of by the time

G.O.Ms.No.926 came to be issued and the remaining 2 writ

petitions were mentioned in the report of the urban land

ceiling officer.

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iii) Allegations of possession:

The report of the Special Officer, Urban Land Ceiling

dated 04.04.2013 stated that the entire land was in the

possession of the writ petitioner. Further, the proceedings

under Section 8(4) of the Urban Land Ceiling Act relating to

the land of the surplus land holders confirmed the physical

possession of the land being in the hands of the surplus land

holders at that point of time. The fact that the land is found to

be in the possession of the petitioner by the Special Officer, in

his report dated 04.04.2013 can only lead to the presumption

that the surplus holders had continued to be in possession

until they had handed over the said physical possession to the

writ petitioner.

7. On the basis of these contentions, it was submitted

that there was no suppression of fact or a case of fraud, on the

basis of which, the earlier G.O. could be cancelled.

8. In view of the subsequent cancellation of

G.O.Ms.No.926 by way of G.O.Ms.No.115 dated 23.04.2020 the

writ petitioner had approached this Court and the learned Single

Judge had allowed the writ petition, holding that there was no

case of fraud or misrepresentation made out by the official

respondents.

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9. Aggrieved by the said order, the respondents in the

writ petition had moved the present appeal on the ground that

the findings of the learned Single Judge are contrary to the

express terms of G.O.Ms.No.747 dated 18.06.2008 in relation to

clauses (a) to (e) of the said G.O stipulating the preconditions for

allotment of land; the finding of the learned Single Judge that

there is no misrepresentation of facts by the petitioner is

erroneous; the finding of the learned Single Judge that the

second round of cancellation could not have been initiated

without indicating the details of the fraud, after a lapse of seven

years is unsustainable; and the surplus land holders having

failed to demonstrate the essential mandatory condition of

possession of the excess land, cannot seek regularization of the

said land in their favour.

Consideration of the Court:

10. The applicants had moved applications under

G.O.Ms.No.747 for 18.06.2018 for regularization of the land in

their favour and G.O.Ms.No.926 dated 31.08.2009 had been

issued. This G.O. was challenged in W.P.No.5419 of 2011 by

another set of claimants who sought for setting aside of the said

G.O with a consequential direction to regularize the land in their

favour. The appellants, apart from some of the legal heirs of late

J. Bhuvaneshwar Das, were party to the said writ petition. A

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learned Single Judge of the erstwhile High Court of Andhra

Pradesh had dismissed the said writ petition with costs, while

holding that the petitioners in the said writ petition were in

contempt of Court.

12. The observations of the learned Single Judge in

W.P.No.5419 of 2011 read as follows:

"As noted above, an interlocutory application is filed seeking summoning of the investigation reports. Both the reports of the ACB and the Vigilance Department have been placed in sealed covers before this Court which are kept in-tact without being opened. As this Court is declining to adjudicate the case on merits, it is not necessary to look into these reports. However, respondent No.1 is left free to take appropriate action against respondent No.2 if any of these reports has indicted the latter. The dismissal of this writ petition also shall not be understood as this Court upholding the validity of the impugned G.O., issued in favour of the private respondents. Respondent No.1 is left free to take appropriate action strictly in accordance with law in the event it is found that the impugned G.O., was issued on account of any fraud or misrepresentation."

11. In a parallel proceeding in W.P.No.20759 of 2009,

the petitioners in that writ petition sought for the vigilance

report in relation to the enquiry conducted against the then

Special Officer. This vigilance report was produced before the

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Court in a sealed cover and it was found that the allegations

made against the then Special Officer were not substantiated.

13. In pursuance of the aforesaid directions, show cause

notice dated 25.11.2014 was issued mentioning the aforesaid

orders of the Hon'ble High Curt. The show cause notice, after

stating certain facts, had called upon the individuals mentioned

in the show cause notice to show cause as to why

G.O.Ms.No.926 should not be cancelled as it was obtained

fraudulently and by misrepresenting the facts. It would also

have to be noted that in the course of arguments in

W.P.No.8280 of 2020, against which the present appeal has

been filed, it was represented by the appellants herein that steps

had been taken to cancel G.O.Ms.No.926 dated 31.08.2009 on

the ground that the said G.O., had been obtained by fraud and

misrepresentation.

14. In these circumstances, the scope of enquiry, for

cancellation of G.O.Ms.No.926 dated 31.08.2009 is restricted to

the question of whether there was any fraud and

misrepresentation by the applicants in whose favour

G.O.Ms.No.926, dated 31.08.2009, had been issued.

15. The learned Government Pleader appearing for the

learned Advocate General had taken us through the judgments

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cited before the learned Single Judge, setting out the scope and

ambit of fraud and misrepresentation in Commissioner of

Customs vs. Essar Oil Ltd.,1; Shrisht Dhawan vs. Shaw

Brothers2: Bhaurao Dagdu Paralkar vs. State of

Maharashtra3; and Lambadi Pedda Bhadru vs. Mohd. Ali

Hussain4.

16. A reading of the aforesaid judgments on the scope

and ambit of fraud, can be summarized by the following

extracts.

"30. A "fraud" is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to gain by another's loss. It is a cheating intended to get an advantage. (See S.P. Chengalvaraya Naidu v.

Jagannath [(1994) 1 SCC 1] .)

31. "Fraud" as is well known vitiates every solemn act. Fraud and justice never dwell together. Fraud is a conduct either by letter or words, which includes the other person or authority to take a definite determinative stand as a response to the conduct of the former either by words or letter. It is also well settled that misrepresentation itself amounts to fraud. Indeed, innocent misrepresentation may also give reason to claim relief against fraud. A fraudulent misrepresentation is called deceit and consists in

(2004) 11 SCC 364

(1992) 1 SCC 534

(2005) 7 SCC 605

(2003) SCC Online AP 621

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leading a man into damage by wilfully or recklessly causing him to believe and act on falsehood. It is a fraud in law if a party makes representations, which he knows to be false, and injury enures therefrom although the motive from which the representations proceeded may not have been bad. An act of fraud on court is always viewed seriously. A collusion or conspiracy with a view to deprive the rights of the others in relation to a property would render the transaction void ab initio. Fraud and deception are synonymous. Although in a given case a deception may not amount to fraud, fraud is anathema to all equitable principles and any affair tainted with fraud cannot be perpetuated or saved by the application of any equitable doctrine including res judicata. (See Ram Chandra Singh v. Savitri Devi [(2003) 8 SCC 319]"

Derry v. Peek [(1886-90) All ER Rep 1 : (1889) 14 AC 337 : 58 LJ Ch 864 : 61 LT 265 (HL)] what constitutes "fraud" was described thus (All ER p. 22 B-C):

"[F]raud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false."

But "fraud" in public law is not the same as "fraud" in private law. Nor can the ingredients, which establish "fraud" in commercial transaction, be of assistance in determining fraud in administrative law. It has been aptly observed by Lord Bridge in Khawaja v. Secy. of State for Home Deptt. [(1983) 1

HCJ&RRR,J W.A.No.257 of 2023

All ER 765 : 1984 AC 74 : (1982) 1 WLR 948 (HL)] , that it is dangerous to introduce maxims of common law as to effect of fraud while determining fraud in relation to statutory law. "Fraud" in relation to statute must be a colourable transaction to evade the provisions of a statute.

" 'If a statute has been passed for some one particular purpose, a court of law will not countenance any attempt which may be made to extend the operation of the Act to something else which is quite foreign to its object and beyond its scope.' Present-day concept of fraud on statute has veered round abuse of power or mala fide exercise of power. It may arise due to overstepping the limits of power or defeating the provision of statute by adopting subterfuge or the power may be exercised for extraneous or irrelevant considerations. The colour of fraud in public law or administrative law, as it is developing, is assuming different shades. It arises from a deception committed by disclosure of incorrect facts knowingly and deliberately to invoke exercise of power and procure an order from an authority or tribunal. It must result in exercise of jurisdiction which otherwise would not have been exercised. That is misrepresentation must be in relation to the conditions provided in a section on existence or non-existence of which power can be exercised. But non-disclosure of a fact not required by a statute to be disclosed may not amount to fraud. Even in commercial transactions non-disclosure of every fact does not vitiate the agreement. 'In a contract every person must look for himself and

HCJ&RRR,J W.A.No.257 of 2023

ensures that he acquires the information necessary to avoid bad bargain.' In public law the duty is not to deceive."

18. The scope of enquiry now before this Court is on the

question of whether the applicants had committed fraud or

misrepresentation. The contention of the appellants is that such

fraud or misrepresentation has been carried out by the

applicants. The grounds of fraud and misrepresentation raised

by the appellants have already been recorded in paragraph No.5

of this order and the reply to these grounds, given by the

applicants have been recorded in paragraph No.6. The

contentions regarding non-payment of necessary fees is neither

a case of fraud nor misrepresentation and the said issue would

not arise for deciding the validity of G.O.Ms.No.926.

19. The allegation of pendency of writ petition being

suppressed also would not arise, as a ground of fraud or

misrepresentation, as the pendency of these writ petitions and

their closure etc., were part of the record submitted by the

Special Officer and Urban Land Ceiling authority to the

Committee constituted for grant of regularization under the

G.O.Ms.No.747. The fact that the pendency of the writ petition

etc., was before the authority recommending regularization,

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precludes any allegation of fraud, meeting the conditions

necessary for fraud to be claimed.

20. The last allegation raised against the applicants is

that the benefit of G.O.Ms.No.747 would only be available who

continued to be in possession of the land and the applicants had

misrepresented that they were in possession of the land even

though the said land had already been taken over by the

Government.

21. The appellants seek to raise two grounds on this

contention. Firstly, the requirements of G.O.Ms.No.747 were not

complied with and secondly suppression of the fact that they

were not in possession, amounts to fraud and

misrepresentation.

22. The said issue is a question of fact into which this

Court would not normally venture. However, the pleadings and

the record placed before this Court elucidates the facts clearly

and without having to go into any disputed facts.

23. It is the case of the appellant-Government that the

declaration under Section 10(3) of the Urban Land Ceiling Act,

was published on 26.12.1991 and notice under Section 10(5)

calling upon the declarant to surrender the excess land was

dated 31.01.1992 served on the declarant on 12.10.1992. An

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order under Section 10(6) is also said to have been issued on

12.10.1992.

24. The counter of the appellant, in the writ petition,

states that the excess land was initially allotted to "Society for

Employment and Training, Visakhapatnam" by G.O.Ms.No.156

Revenue dated 20.12.1991 and the land had been handed over

to the society. The notice under Section 10(5) was served on the

declarant on 12.10.1992. In such circumstances, the question of

the Government having taken possession of the land before this

date and handing over the said land in December 1991 to the

society, mentioned above, would not arise.

25. It is the further pleading of the appellant that this

land was withdrawn from Visakhapatnam Urban Development

Authority, under G.O.Ms.No.348 dated 16.04.1994, and

subsequently, re-allotted to M/s. APIIC through G.O.Ms.No.774

dated 07.06.2007, which was subsequently, kept in abeyance by

way of G.O.Ms.No.803 dated 12.06.2007. The allotment and re-

allotment of this land in favour of various organizations is

apparently without handing over the possession of this land to

any of these organizations. Consequently, the allotment/ re-

allotment of this land to various organizations does not in any

manner, demonstrate possession having been taken from the

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declarant or his family members. The Special Officer and

competent authority, upon an application being made by the

family members of the original declarant under G.O.Ms.No.747,

is said to have submitted a report on the eligibility of these

applicants. This report ostensibly did not state anywhere that

the applications were not in possession of the land.

G.O.Ms.No.926 was issued on the basis of this report. Initially,

doubts were raised as to the collusion of the Special Officer with

the applicants and a vigilance enquiry was also conducted. The

vigilance report in this regard was also produced before the

Court in the related proceedings mentioned above. This enquiry

report apparently gave a clean chit to the Special Officer. A

second enquiry and inspection was carried out by the Special

Officer in the course of the proceedings for revocation of

G.O.Ms.No.926. The Special Officer had submitted a report in

the year 2013 recording the fact that the applicants were in

possession of the land.

26. The counter affidavit filed, by the appellants, before

the learned single Judge, had stated that the possession of the

land was taken by the authorities, by way of a panchanama

dated 25.04.2020 after the impugned G.O.Ms.No.115 revoking

G.O.Ms.No.926 had been issued. The fact that the possession is

said to have been taken over under a panchanama would itself

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beg the question as to why such a panchanama was needed

when the applicants were never in possession, according to the

appellants.

27. All the aforesaid circumstances, clearly show that

the contention of the appellants that the applicants, being the

family members and legal heirs of the original declarant, were

not in possession of the land, is not correct. The Appellants, in

the course of the appeal, had also taken the stand that the

petitioner herein had, during the pendency of this appeal, taken

back possession of the land.

28. In that view of the matter, this Court would have to

accept the fact that the applicants continued to be in possession

of the land and consequently there was neither

misrepresentation or fraud by the applicants, in obtaining

G.O.Ms.No.926. In the circumstances, there is no reason to

interfere with the orders of the learned Single Judge dated

22.12.2022.

29. Accordingly, the writ appeal is dismissed. There

shall be no order as to costs. As a sequel, pending miscellaneous

petitions, if any, shall stand closed.

PRASHANT KUMAR MISHRA ,CJ R. RAGHUNANDAN RAO, J RJS/JS

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HC,J & RRR,J

After the judgment was pronounced, learned Advocate

General would submit that the State intends to prefer an appeal

against the order passed by this Court. Therefore, interim order

of status quo passed by this Court, during pendency of the writ

appeal, may be extended for a period of three weeks.

Considering the entire fact situation of the case, we are of

the view that no harm would be caused to the parties if the

interim order of status quo, passed by us earlier, is allowed to

continue up to 03.06.2023.

Accordingly, interim order of status quo, passed by us

during pendency of the writ appeal, is extended up to

03.06.2023.

PRASHANT KUMAR MISHRA ,CJ R. RAGHUNANDAN RAO, J RJS/JS

HCJ&RRR,J W.A.No.257 of 2023

HON'BLE MR. JUSTICE PRASHANT KUMAR MISHRA, CHIEF JUSTICE & HON'BLE SRI JUSTICE R. RAGHUNANDAN RAO

WRIT APPEAL No.257 of 2023

(per Hon'ble Sri Justice R.Raghunandan Rao)

10.05.2023 RJS/JS