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CASE NO.:

Appeal (civil) 6546 of 1999

PETITIONER:

Govt. of A.P. & Anr.

RESPONDENT:

Syed Akbar

DATE OF JUDGMENT: 19/11/2004

BENCH:

SHIVARAJ V. PATIL & B.N. SRIKRISHNA

JUDGMENT:

J U D G M E N T

W I T H

CIVIL APPEAL NO. 4110 OF 2000

Shivaraj V. Patil J.

CIVIL APPEAL NO. 6546 OF 1999

The State of Andhra Pradesh is in appeal questioning

the validity and correctness of the impugned order made by

the Division Bench of the High Court in Writ Appeal No. 411

of 1998.

The few facts which are relevant and necessary for the

disposal of this appeal are the following:

An extent of 1573 sq. yds. in survey No. 54/2 of

Kakaguda village in Hyderabad district was acquired by the

State for improvement of Hyderabad-Karimnagar-

Ramagundam Road which included the land of the

respondent to the extent of 8 guntas (968 sq. yds.). After

completing the acquisition proceedings, the possession of

the said land was taken. Aggrieved by the amount of

compensation determined @ Rs. 1400 per sq. yds., the

respondent sought reference under Section 18 of the Land

Acquisition Act,1894 (for short 'the Land Acquisition Act)

seeking enhancement of compensation amount and the

reference is pending disposal before the Reference Court.

Out of the land so acquired, only 424 sq. yds., of land

was utilized and the rest of the land remained vacant. The

Resident Engineer (Roads & Buildings) addressed a letter

dated 27.12.1996 to the Land Acquisition Officer (Special

Collector) informing him that it was difficult to protect the

unused land from future encroachment. Having come to

know about this letter, the respondent made

representations to the District Collector to re-assign unused

land to him and that he was prepared to reimburse the

compensation that had been received by him along with

interest. He also indicated that he was prepared to give up

his claim for enhancement of compensation to that extent

of land. There was no response from the collector. The

respondent filed a writ petition No. 14062/97 in the High

Court seeking a writ of mandamus to the authorities to re-

assign the unused land to him. He based his claim on the

Standing Order No. 90 (32) of the A.P. Board of Revenue.

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A learned Single Judge of the High Court disposed of the

writ petition on 4.7.1997 directing the District Collector to

consider the request of the respondent for re-assigning of

the unused land in the light of the order of the Board of

Revenue aforementioned having regard to the letter of the

Resident Engineer dated 27.12.1996 and by collecting the

amount of compensation already paid with 12% interest.

Pursuant to the directions given in Writ Petition No. 14062

of 1997 the respondent made representation to the

authorities seeking re-assignment of unused land. The

District Collector by his order dated 18.10.1997 rejected

the said representation, holding that the said land was

suitable for construction of Mandal Office. In this order the

District Collector referred to the judgments of the Supreme

Court in State of Kerala and others vs. M. Bhaskaran

Pillai and another [(1997) 5 SCC 432], and Sri Gulam

Mustafa and others vs. State of Maharashtra and

others [AIR 1977 SC 448]. As against this order of the

District Collector the respondent filed another writ petition

No. 33171 of 1997 in the High Court. The learned single

Judge, after considering the contentions of the parties, by

order dated 2.1.1998, allowed the writ petition directing the

authorities to hand over the unused portion of the land to

the respondent by collecting the amount of compensation

already paid with interest at the rate of 12%. It may be

added here itself that para 32 of the Board's Standing Order

No. 90 was amended by the Government Order dated

9.10.1998 to the effect that in case the land acquired

remains unused for any reason, it could be utilized for any

other public purpose as deemed fit. Aggrieved by the order

of the learned Single Judge, the State filed a writ appeal

before the High Court. By the impugned appeal, the

Division Bench of the High Court held that apart from the

Board's standing order 90(32), Section 54-A of the Andhra

Pradesh (Telangana Area) Land Revenue Act (for short `the

Act') also supported the case of the respondent. The

Division Bench also took the view that the proposal to

construct Mandal Revenue Office building in the unused

land was an after-thought and was made with a view to

circumvent the order passed by the learned Single Judge

and even otherwise, the unused land in question was so

small that it would not be sufficient to construct any

building. Having held so, the Division Bench of the High

Court dismissed the writ appeal by the judgment which is

under challenge in this appeal.

The facts are not in dispute. The questions that arise

for consideration are whether direction could be given to

the appellants to re-assign unused land to the respondent

which was duly acquired by the authorities and the

acquisition proceedings had become final except that the

reference is pending before the Reference Court only with

regard to enhancement of compensation and whether the

Board's Standing Order No. 90(32) and Section 54-A of the

Act can be applied for reassignment of the unused land in

favour of the respondent.

Learned counsel for the appellants contended that

once the land is acquired in accordance with law which

vests in the Government free from all encumbrances, no

direction could be given to re-convey the unutilized land

which is part of the acquired land; Section 54-A of the Act

is not at all applicable to the facts of the present case; the

Standing Order No. 90(32) of the Board of Revenue has no

statutory force and at any rate it cannot override the

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provisions of the Land Acquisition Act and that the Division

Bench of the High Court was not correct in observing that

the unused land was not sufficient for the purpose of

construction of the Mandal Revenue Officer; it was for the

concerned authorities to examine the sufficiency or

otherwise of the available land.

In opposition, the learned counsel for the respondent

made submissions supporting the impugned order for the

very reasons stated in it. In his argument, he reiterated

the submissions that were made before the High Court.

According to him, having regard to the facts and

circumstances of the case, this Court may not interfere with

the impugned order exercising jurisdiction under Article 136

of the Constitution.

In order to appreciate the respective contentions

advanced on behalf of the parties, it would be useful to

notice relevant portion of the Standing Order No. 90(32) of

Board of Revenue and Section 54-A of the Act.

The Board's standing order

"32. Disposal of land which is no longer required

for the public purpose for which it was acquired.

Notes \026 (1) No land shall be disposed of, under

this paragraph, to any person other than the

citizen of India, except by the Collector or the

Board and with the previous permission of State

Government, every grant made under this

paragraph shall be subject to the condition that,

if the land is alienated without the sanction of

Government in favour of any person other than a

citizen of India, the grant shall thereupon

become null and void.

.........................................................

When land acquired for a public purpose, is

subsequently relinquished, it should be disposed

of as follows:-

(i) If the land relinquished is likely to be again

required for public purposes, it should be

merely leased out for such term as may be

considered, desirable in each case.

(ii) ................

(iii) ................

(iv) If the land is not declared unfit for

permanent occupation under clause (i) or

(ii) above and was agricultural or pastoral

land at the time of the acquisition, it should

be disposed of in accordance with the

following instructions which should not be

deviated from without the previous

sanction of State Government: -

Such lands should be notified for sale

in public auction by giving wide publicity in

respect of the sales in the villages by beat

or tom-tom and affixing notice of sales in

conspicuous places in the villages

concerned. The date of sale should be

fixed allowing an interval of thirty days

between the date of publicity and the date

of sale. The land should be sold by public

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auction subject to the annual assessment.

There shall be no upset price except in the

case of railway relinquished lands where a

minimum or upset price should be fixed in

consultation with Railway Administration

before auction. If at the time of sale

anybody puts forth his claim in respect of

any field either as an adjacent owner, or as

an original owner or as heir of the original

owner, the sale of that field should be

stopped and his claim investigated and

disposed of in the manner specified in sub-

clause (2) and (3). If it is found that his

claim is not proved, the field should be sold

by public auction."

The amendment to paragraph 32 of Board's Standing

Order No. 90(32) brought about by G.O.Ms. No. 783 dated

9.10.1998 reads:

"For paragraph 32 of B.S.O. 90, the following

paragraph shall be substituted, namely:-

PARA 32 Utilisation of acquired lands for any

other Public Purpose:

"The land acquired for a public purpose under

the Land Acquisition Act, 1894 shall be utilized

for the same purpose for which it was acquired

as far as possible. In case, the land is not

required for the purpose for which it is acquired

due to any reason, the land shall be utilized for

any other public purpose, as deemed it,

including afforestation."

Section 54-A of the Act reads:

"Procedure in respect of land acquired for

purpose of public benefit and no more required \026

When agricultural or pasturage land acquired for

public benefit is no longer required, the patta

thereof shall be made in the name of the person

or his successor from whom such land was

acquired, provided he consents to refund the

compensation originally paid to him. If such

person or his successor does not take the land, it

may be given on patta under Section 54."

It is neither debated nor disputed as regards the valid

acquisition of the land in question under the provisions of

the Land Acquisition Act and the possession of the land had

been taken. By virtue of Section 16 of the Land Acquisition

Act, the acquired land has vested absolutely in the

Government free from all encumbrances. Under Section 48

of the Land Acquisition Act, Government could withdraw

from the acquisition of any land of which possession has not

been taken. In the instant case, even under Section 48,

the Government could not withdraw from acquisition or to

re-convey the said land to the respondent as the possession

of the land had already been taken. The position of law is

well settled. In State of Kerala and Ors. Vs. M.

Bhaskaran Pillai & Anr. [(1997) 5 SCC 432], para 4 of

the said judgment reads:-

"4. In view of the admitted position that the

land in question was acquired under the Land

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Acquisition Act, 1894 by operation of Section 16

of the Land Acquisition Act, it stood vested in the

State free from all encumbrances. The question

emerges whether the Government can assign

the land to the erstwhile owners? It is settled law

that if the land is acquired for a public purpose,

after the public purpose was achieved, the rest

of the land could be used for any other public

purpose. In case there is not other public

purpose for which the land is needed, then

instead of disposal by way of sale to the

erstwhile owner, the land should be put to public

auction and the amount fetched in the public

auction can be better utilised for the public

purpose envisaged in the Directive Principles of

the Constitution. In the present case, what we

find is that the executive order is not in

consonance with the provision of the Act and is,

therefore, invalid. Under these circumstances,

the Division Bench is well justified in declaring

the executive order as invalid. Whatever

assignment is made, should be for a public

purpose. Otherwise, the land of the Government

should be sold only through the public auctions

so that the public also gets benefited by getting

a higher value."

In that case, an extent of 1.94 acres of land was

acquired in 1952 for construction of National Highway and

the construction was completed in 1955 in 80 cents of land

and the balance of land remained unused. The remaining

land was sought to be sold to the land owner at the same

rate at which the compensation was awarded under Section

11. This again was challenged in the writ petitions. The

Government tried to sustain the action on the basis of the

executive order issued by the Government for permission

for alienation of the land. On these facts, the position of

law was made clear in para 4 extracted above. Thus, it is

clear that under Section 16 of the Land Acquisition Act, the

acquired land should vest in the State free from all

encumbrances and that any executive order inconsistent

with the provisions of Land Acquisition Act was invalid.

Further that if the land is acquired for a public purpose,

after the public purpose was achieved, the rest of the land

could be used for any other public purpose. In our view,

this decision supports the case of the appellants fully.

In the case Chandragauda Ramgonda Patil & Anr.

vs. State of Maharashtra & Ors. [(1996) 6 SCC 405],

claim of the petitioner for restitution of the possession of

the land acquired pursuant to the resolution of the State

Government was rejected. In para 2, this Court observed

thus:-

"2........ We do not think that this Court would be

justified in making direction for restitution of the

land to the erstwhile owners when the land was

taken way back and vested in the Municipality

free from all encumbrances. We are not

concerned with the validity of the notification in

either of the writ petitions. It is axiomatic that

the land acquired for a public purpose would be

utilized for any other public purpose, though use

of it was intended for the original public purpose.

It is not intended that any land which remained

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unutilized, should be restituted to the erstwhile

owner to whom adequate compensation was

paid according to the market value as on the

date of the notification. Under these

circumstances, the High Court was well justified

in refusing to grant relief in both the writ

petitions."

Yet in another recent decision, this Court in Northern

Indian Glass Industries vs. Jaswant Singh & Ors.

[(2003) 1 SCC 335] referring to the case of Chandragauda

Ramgonda Patil (supra) and other cases held that "if the

land was not used for the purpose for which it was

acquired, it was open to the State Government to take

action but that did not confer any right on the respondents

to ask for restitution of the land". Paras 10 and 11 of the

said judgment read thus:-

"10. In Chandragauda Ramgonda Patil vs. State

of Maharashtra [(1996) 6 SCC 405] it is stated

that the acquired land remaining unutilized was

not intended to be restituted to the erstwhile

owner to whom adequate compensation was

paid according to the market value as on the

date of notification.

11. Yet again in C.Padma Vs. Dy. Secy. To the

Govt. of T.N. [(1997) 2 SCC 627], it is held that

acquired land having vested in the State and the

compensation having been paid to the claimant,

he was not entitled to restitution of possession

on the ground that either original public purpose

had ceased to be in operation or the land could

not be used for other purpose."

From the position of law made clear in the

aforementioned decisions, it follows that (1) under Section

16 of the Land Acquisition Act, the land acquired vests in

the Government absolutely free from all encumbrances; (2)

the land acquired for a public purpose could be utilized for

any other public purpose; and (3) the acquired land which

is vested in the Government free from all encumbrances

cannot be re-assigned or re-conveyed to the original owner

merely on the basis of an executive order.

At the hearing, we specifically asked learned counsel

for the respondent whether the Board's Standing Order

90(32) was issued under any particular statute, the learned

counsel was not able to point out to any provision of law

under which it was issued. He was not in a position to show

that the said order bears any statutory force. Even

otherwise, as per para 32 of the said order, the land

acquired, no longer required for the public purpose for

which it was acquired, could not be disposed of in favour of

any person other than the citizen of India and that too

without the sanction of the Government . If the land

acquired for the public purpose is specifically relinquished,

such land could be disposed of as stated in the said

paragraph. If the land relinquished is likely to be again

required for public purposes, it should be merely leased out

for such term as may be considered desirable in each case.

If the acquired land was an agricultural land at the time of

acquisition, it should be disposed of inviting for sale in

public auction by giving wide publicity in respect of sale. If

at the time of sale, anybody puts forth his claim in respect

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of any field either as an adjacent owner or as an original

owner, the sale of that field should be stopped and his claim

investigated and disposed of in the manner specified in sub-

clauses (i) and (iv) of Note (2) of the Board's order 90(32).

If it is found that his claim is not proved, the field should be

sold by public auction. In the case on hand, there is

nothing on record to show that the part of the acquired land

which remained unused was relinquished by the

Government. A letter of Resident Engineer stated that the

unused land was no more required cannot amount to

relinquishment of the said land by the competent authority.

In order to make a claim under para 32 of the said Board's

Standing Order in the first place, it was necessary that the

competent authority had subsequently relinquished the

unused land. After such relinquishment of the land, the

land had to be notified for sale in public auction. If at the

time of sale of such land, the original owner made a claim,

sale could be stopped and his claim could be investigated

and thereafter the land was to be disposed of in the manner

specified under the said paragraph. Added to this, by virtue

of the amendment to para 32 brought about by G.O.Ms. No.

783 dated 9.10.1998, the land for the public purpose shall

be utilized for the same purpose for which it was acquired

as far as possible and in case the land is not used for the

purpose for which it was acquired due to any reason, the

land shall be utilized for any other public purpose as

deemed fit. It appears this amendment was not brought to

the notice of the High Court.

Chapter V of the Act deals with occupation of khalsa

land and right of occupant. Under Section 54, procedure is

prescribed for acquiring unoccupied land. This Section

enables a person to submit a petition to Tehsildar if he is

desirous of taking unoccupied land. On such application,

the Tehsildar may in accordance with the rules made by the

Government give permission in writing for occupation.

Section 54-A indicates the procedure in respect of land

acquired for the purpose of public benefit and which is no

more required. It is clear from plain and clear language of

the said Section that when an agricultural land acquired for

public benefit is no longer required, the patta thereof shall

be made in the name of the person or his successor from

whom such land was acquired provided he consents to

refund the compensation originally paid to him. This

Section does not say that the agricultural land acquired for

public benefit is no longer required for the purpose for

which it is acquired. This Section can be attracted only in a

case where agricultural land acquired for public benefit is no

longer required not necessarily for the specific purpose for

which it was acquired. Added to this, that the land is no

more required is a decision required to be made by the

competent authority. As in the present case, mere letter of

Resident Engineer that the unused land is no more required

is not enough. When the land is acquired under the Land

Acquisition Act which is vested in the State Government

free from all encumbrances, the question of reconveying

the land as claimed by the respondent could not be

accepted in view of the clear position of law stated in the

decisions of this Court aforementioned. Whether the

unused remaining land out of the acquired land was

sufficient or not for the purpose of construction of Mandal

Revenue Office could not be decided by the High Court. It

was for the competent authorities to decide about the

same. The High Court, in our view, was not right in saying

that the proposal to construct the Mandal Revenue Office in

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the unused land acquired was an after-thought. No

material was placed on record to attribute any mala fides

on the part of the authorities or to support the case that the

proposal to build a Mandal Revenue Office was an after-

thought.

Thus viewed from any angle, we find it difficult to

sustain the impugned order. Consequently, it is set aside

and the writ petition filed by the respondent is dismissed.

The appeal is allowed accordingly. No costs.

CIVIL APPEAL NO. 4110 OF 2000

The building bearing No. 21/1/683 situated at

Kokarwadi, Rikabgunj, Hyderabad belonging to respondent

no. 1 was acquired by erstwhile Hyderabad Government for

Kokarwadi Scheme of the then City Improvement Board.

The award was passed under the Land Acquisition Act on

25.7.1953 and compensation was paid to the respondent

no. 1. In 1956, the Andhra Pradesh Housing Board was

established and all the properties of the then City

Improvement Board stood transferred and vested in the

Andhra Pradesh Housing Board, the appellant herein. Since

the Kokarwadi Scheme was abandoned, the building in

question was leased out to the respondent no. 2. The

respondent no. 1 made representation to the appellant

seeking reconveyance of the building on payment of

compensation amount with interest relying on Standing

Order No. 90(32) of the Board of Revenue. On 28.9.1979,

appellant passed resolution for disposing of the property

and similar other properties to the tenants. On 6.2.1989,

the appellant rejected the representation of the respondent

no. 1. Under the circumstances, the respondent no. 1-

erstwhile owner of the building filed a original suit in City

Civil Court, Hyderabad, seeking a mandatory injunction for

re-conveyance of the building and possession of the same.

The appellant contested the suit. The trial court decreed

the suit in favour of the respondent no. 1 relying on the

Standing Order No. 90(32) of the Board of Revenue. The

respondent no. 2 here who was in occupation of the

property as a tenant was defendant no. 2 in the suit. The

appellant filed first appeal before the 4th Additional Chief

Judge, City Civil Court, Hyderabad. The second respondent

did not prefer any appeal against the decree made by the

trial court. The Addl. Chief Judge dismissed the first appeal

affirming the decree made by the trial court. The appellant

filed the second appeal before the High Court which was

also dismissed. Hence, this appeal.

Learned counsel for the parties in this appeal also

made similar submissions that were made in Civil Appeal

6546 of 1999 bringing to our notice facts of this case.

In the view we have taken in Civil Appeal No.

6546/1999 dealing with the Board's Standing Order No.

90(32) and Section 54-A of the Act and keeping in view the

settled position of law, this appeal is also entitled to

succeed. Under the circumstances it is unnecessary to deal

with other contentions. Accordingly, this appeal is allowed.

The impugned judgment is set aside and the suit filed by

respondent no. 1 (plaintiff) is dismissed with no order as to

costs.