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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

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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