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PETITIONER: BAGH AMBERPET WELFARE SOCIETY

       Vs.

RESPONDENT: TULSI COOPERATIVE HOUSING SOCIETY AND ORS.

DATE OF JUDGMENT17/08/1990

BENCH: MISRA RANGNATH BENCH: MISRA RANGNATH KANIA, M.H. VENKATACHALLIAH, M.N. (J)

CITATION:  1990 SCR  (3) 782        1990 SCC  (4) 468  JT 1990 (3)   497        1990 SCALE  (2)253

ACT:     Land Acquisition Act, 1894: Sections 4, 5 and  6--Acqui- sition   of   land   in   which   two   Societies   claiming interest--Settlement  of disputes-Not  forthcoming----Matter remitted to High Court.

HEADNOTE:     For  the  purposes of a housing project, some  land  was acquired by way of a notification under the Land Acquisition Act.  The  Respondent Society claiming that it  had  entered into  a  contract with the owners for  purchasing  the  very property, applied for exemption under the Urban Ceiling Act. The  exemption  prayed for was refused  initially,  but  was granted later.     Both  the Respondent Society and the owners of the  said land filed Writ Petitions before the High Court for quashing of  the acquisition proceedings. The acquisition was  upheld by  Single Judge, but on appeal by Respondent  Society,  the Full  Bench held the acquisition proceedings to be  inopera- tive. Against these orders, the appellant Society which  had entered  into an agreement with the  Municipal  Corporation, and as such interested in the acquisition, has preferred the appeals.     Meanwhile,  the State Government withdrew the  exemption granted under the Urban Ceiling Act. One of the owners filed a Writ Petition before the High Court challenging the  with- drawal.  The High Court took note of the fact that the  mat- ters were pending in this Court and dismissed the  petition. Aggrieved  against  the order of dismissal, a  petition  for special leave has been filed.     The Respondent Society also moved the High Court by  way of a Writ Petition challenging the withdrawal of  exemption, which  was  pending and this Court transferred the  same  to itself, to be heard with the pending cases.     On 7.8.1985, this Court gave time to Counsel to consider various  compromise proposals. However, the desired  compro- mise did not come through. On 23.8.1988 this Court passed an order holding that the 783 acquisition  proceedings  have to be  revived.  However,  no formal  disposal was recorded since a settlement  was  being

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negotiated.  Even after about 2 yrs. the settlement did  not fructify. Remitting the matters to the High Court,     HELD: 1. If the settlement does not fructify, the effect of  the  decision that the acquisition  proceedings  are  to revive,  would be that the claim to the land  by  Respondent Society  would  come to an end. In that event, at  the  most that Society would only be entitled to such compensation  as may  be  awardable in law. If the acquisition  proceeds  the appellant  Society and the Municipal Corporation would  have to  workout their mutual rights. Apart from these,  the  two writ  petitions challenging the withdrawal of the  exemption by  order dated 23.6.1983 would also have to be disposed  of on  merits. In view of the fact that the owner’s writ  peti- tion  was  dismissed not on merits but on  other  considera- tions,  the said dismissal should be vacated and  that  writ petition  should  be  heard along  with  Writ  Petition  No. 6500/83  as a common question arises for determination.  The order  of  the High Court dated 13th of June, 1988,  is  set aside and the High Court is directed to dispose of the  Writ Petition afresh on merits. [787B-D]     2.  If the High Court is of the opinion that the  matter should be settled and the entire land of the owners  amount- ing to 18 acres and 3 gunthas should be divided between  the two  Societies, it will be free to do so if Government  also agrees  thereto.  Since that arrangement would be  with  the consent of the State Government it would in such an event be open  to  the  High Court to nullify  the  acquisition.  The observations made at different stages during the pendency of the proceedings in this Court may not be taken to be expres- sion  of opinion on merits and the High Court would be  free to deal with the matter on its own discretion and in accord- ance with law. [787F-G]     3.  In the event of the settlement not  coming  through, the acquisition proceedings would continue under the law and be  concluded by the Land Acquisition Officer in  accordance with  law. In the event of the acquisition working out,  the two writ petitions against the withdrawal of exemption would not be sustainable as the land would vest in Government as a result of acquisition. It would be open to the Government or the  acquiring authority to take into account the effect  of the laws of urban ceiling. [787H; 788A] 4.  The  civil appeals are also remitted to the  High  Court limited to 784 the  consideration of the proposals’ for settlement  in  the light of the observations made in this Judgment.  Otherwise, they  must be taken to have been concluded in this Court  on the finding that acquisition proceedings are valid and shall be  entitled  to  continue. The special  leave  petition  is disposed  of with a direction that the writ petition in  the High Court shall be re-heard. The transferred writ  petition remitted to the High Court for disposal, [788B-C]     5.  Money,  if any, in deposit in the Registry  of  this Court  to the credit of the parties shall be transferred  to the  High Court and shall be subject to such  directions  as the High Court may issue upon a final decision of the  rele- vant issues arising in the proceedings. [788D]

JUDGMENT:     CIVIL APPELLATE JURISDICTION: Civil Appeals Nos.  578485 of 1983.     From the Judgment and Order dated 2.3.1983 of the Andhra

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Pradesh High Court in W.A. Nos. 170 and 171 of 1982. WITH     Special  Leave  Petition (Civil) No. 1679  of  1989  and Transfer case No. 29 of 1989.     From  the  Judgment  and Order dated  13.6.1988  of  the Andhra Pradesh High Court in Writ Petition No. 5498 of 1983.     T.S.  Krishnamurthy lyer, Dr. V. Gouri  Shankar,  Meeraj Khayyam,  R.N. Keshwani. M. Qamaruddin, P.N. Mishra and  Mrs M. Qamaruddin for the Appellant.     Dr. L.M. Singhvi, S.K. Shashtri, D.N. Mishra and T.V.S.N Chart for the Respondents.     C. Sitaramaiah and G. Prabhakar for the State of  Andhra Pradesh. The Judgment of the Court was delivered by     RANGANATH MISRA, J. The appeals are by special leave 1he transferred  writ petition by respondent No. 1 in the  Civil Appeals  is   writ petition before the Andhra  Pradesh  High Court  being  6500 of 1983 in a connected  proceedings.  The special leave petition is by the 785 owner of some lands which form the subject-matter of  acqui- sition.     On 5.6.1975 21.10 acres of land located at Bagh Amberpet in  Hyderabad said to be belong to Syed Azam and members  of his family were notified to be acquired under S. 4(1) of the Land Acquisition Act for a housing project undertaken by the Hyderabad Municipal Corporation in collaboration with HUDCO. Enquiry  under  s.  5A of the Act was dispensed  with  by  a separate  notification  issued along  with  the  preliminary notification.  On 25.4.1978, notification under S. 6 of  the Land  Acquisition  Act was made. Tulsi  Cooperative  Housing Society  on the plea that it had entered into a contract  of purchasing the very property from the owners had applied for exemption  under the Urban Land Ceiling Act. On  17.10.1978, prayer  for  exemption was refused. On  11.9.1980  exemption was,  however,  granted. Thereupon two writ  petitions  were filed before the High Court--one by Tulsi Cooperative  Hous- ing Society and the other by the owners of the property  for quashing of the acquisition proceedings. The learned  Single Judge  upheld the acquisition but the writ appeal  of  Tulsi Cooperative Housing Society were allowed by a Full Bench  of the High Court as a result of which the acquisition proceed- ings were held to be inoperative.     Bagh Amberpet Welfare Society had entered into  arrange- ment  with  the Hyderabad Municipal  Corporation  for  being assigned land for construction and was, therefore, interest- ed in the acquisition. The civil appeals are by that Society challenging the decision of the Full Bench of the High Court in  the two writ appeals filed by Tulsi Cooperative  Housing Society. On 23.6.1983, the exemption which had been granted on  11.9. 1980  was withdrawn by the State Government. Syed Azam,  one of the owners, challenged the withdrawal of the exemption by filing a writ petition before the High Court. The High Court took  note  of  the position that the  dispute  was  already pending  in  this Court and, therefore, by its  order  dated 13.6.1988, dismissed the petition without entering into  the merits. That has led the owner to move this Court by special leave.     Tulsi  Cooperative Housing Society also moved  the  High Court by filing Writ Petition No. 6500/83 against the  with- drawal or’ the exemption. That petition was pending  adjudi- cation  before  the High Court and at the  instance  of  the parties  this Court directed transfer of that case  to  this Court  to be heard along with the pending matters.  This  is

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how  Transferred Writ Petition No. 29/89 forms part of  this group of litigation. 786     On 7.8.1985, this Court desired that the dispute  should be  settled amicably and accordingly certain proposals  were examined.  As already noticed, the acquisition was of  20.10 acres  of land. 18 acres and 3 gunthas belonged to the  Azam family  and at one stage each of the two Cooperative  Socie- ties  had agreed to take 9 acres and 1-1/2 gunthas  thereof. The  Secretary  to Andhra Pradesh Government  in  the  Urban Development  Department responded to the settlement by  say- ing: "Since  the  compromise is arrived at between both  the  ag- grieved parties before the Requisitioning Officer based upon the  opportunity given by the Supreme Court, the State  Gov- ernment  need not intervene in regard to  land  acquisition. Necessary  and  just orders under the circumstances  of  the case may be passed on the basis of the compromise deed filed by  both  the Societies at the earliest possible  to  enable them to build houses." This Court, however, gave time to the counsel for the  State of Andhra Pradesh to take instructions as to the application of the Urban Land Ceiling Act as exemption granted under  s. 20  had  been withdrawn in June, 1983. The State  of  Andhra Pradesh  thereafter did not accept the compromise by  taking the stand that proceedings under the Urban Land Ceiling  Act were  pending  and  in view of the fact that  there  was  no exemption,  the  property was liable to vest  in  Government under the Act as surplus land.     This Court on August 23, 1988, made an order, the  rele- vant part of which is extracted: "We  are not impressed by the stand taken by the writ  peti- tioners that there was justification for their not approach- ing the court for six years after the s. 4(1)  notification, when  they  wanted to challenge the denial  of  the  hearing under S. 5A of the Act and the proceedings itself otherwise. We agree with the learned Single Judge that the  explanation not  being  acceptable, the writ petition has  been  rightly dismissed.  On this analysis the appellate judgment  of  the High Court cannot be sustained and the acquisition  proceed- ings have to be revived." This  order  virtually disposed of the appeals  but  as  the parties  were  negotiating a settlement the  Court  did  not record a formal disposal of the dispute. 787     If  the settlement does not fructify, the effect of  our decision  that  the acquisition proceedings are  to  revive, would  be  that the claim to the land by  Tulsi  Cooperative Housing Society would come to an end. In that event, at  the most  that Society would only be entitled to such  compensa- tion as may be awardable in law. If the acquisition proceeds the Bagh Amberpet Welfare Society and the Municipal Corpora- tion would have to work out their mutual rights. Apart  from these, the two writ petitions challenging the withdrawal  of the exemption by order dated 23.6.1983 would also have to be disposed of on the merits. The owner’s application has  been dismissed  upon  the  High Court taking the  view  that  the matter was before this Court and, therefore, the High  Court would  not  entertain the dispute. The  challenge  by  Tulsi Cooperative Housing Society against the said withdrawal  was before the High Court for adjudication. In view of the  fact that  the owner’s writ petition was dismissed not on  merits but  on  other considerations, we are of the view  that  the said  dismissal  should be vacated and  that  writ  petition should  be heard along with Writ Petition No. 6500/83  as  a

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common question arises for determination. We, therefore, set aside the order of the High Court dated 13th of June,  1986, and direct that the said writ petition shall be disposed  of afresh on merits.     We are of the view that the entire litigation should  go back to the High Court for appropriate disposal. The  trans- ferred  writ petition, therefore, shall also go back to  the High Court and shall be dealt with as Writ Petition No. 6500 of  1983.  The two petitions challenging the  withdrawal  of exemption  shall be clubbed together and be heard. The  pro- posals undertaken relating to a settlement in regard to  the 18 acres and 3 gunthas of land may be considered by the High Court  in  the light of all relevant  material  and  circum- stances. If the High Court is of the opinion that the matter should be settled and the entire land of the owners  amount- ing to 18 acres and 3 gunthas should be divided between  the two  Societies, it will be free to do so if Government  also agrees  thereto.  Since that arrangement would be  with  the consent of the State Government it would in such an event be open  to  the  High Court to nullify  the  acquisition.  The observations  which we have made at different stages  during the  pendency  of the proceedings in this Court may  not  be taken to be expression of opinion on the merits and the High Court  would  be  free to deal with the matter  in  its  own discretion and in accordance with law.     In  the event of the settlement not coming  through  the acquisition proceedings would continue under the law and  be concluded by the Land Acquisition Officer in accordance with law. In the event of the 788 acquisition working out, the two write petitions against the withdrawal of exemption would not be sustainable as the land would  vest  in Government as a result  of  acquisition.  It would  be open to the Government or the acquiring  authority to  take into account the effect of the laws of urban  ceil- ing.     The civil appeals are remitted to the High Court limited to the consideration of the proposals for settlement in  the light of the observations hereinabove. Otherwise, they  must be taken to have been concluded in this Court on our finding that acquisition proceedings are valid and shall be entitled to continue. The special leave petition of Azam is  disposed of with a direction that the writ petition in the High Court shall be re-heard. The transferred writ petition is remitted to  the  High Court to be disposed of as Writ  Petition  No. 6500 of 1983. The hearing of the writ petitions would depend upon the fate of the settlement as indicated above. There would be no order for costs in this Court.     Money, if any, in deposit in the Registry of this  Court to  the  credit of the parties shall be transferred  to  the High  Court and shall be subject to such directions  as  the High  Court may issue upon a final decision of the  relevant issues arising in the proceedings. G.N.                                Appeals  and   Petitions disposed of. 789