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Harish Tandon v. State Of U.P. & Another - WRIT - C No. 3341 of 1999  RD-AH 6934 (30 March 2006)
Civil Misc. Writ Petition No. 3341 of 1999.
Harish Tandon. ....... ........ Petitioner.
State of U.P. through Secretary
concerned and another. ....... ........ Respondents.
(Hon'ble Mr. Justice Amitava Lala and Hon'ble Mr. Justice Shiv Shanker)
For the Petitioner : Sri Ravi Kant, Sr. Advocate.
Sri Pushkar Mehrotra.
For the Respondents : Sri R.K. Awasthi, Standing Counsel.
Amitava Lala, J.-- This case is made out basically for conversion of leasehold 'Nazul' land to freehold land along with various other reliefs. Therefore, let us first of all know what is 'Nazul'? 'Nazul' means any land or building which, being the property of Government is not administered as a State property under the control of the Land Reforms Commissioner or the Forest or the Irrigation Department, or is not under the control of the Military, Postal, Telegraph, Railway or other purely Central Government Department. It means properties i.e. land or buildings in or near towns or villages which have escheated or lapsed to the Government. In further, in absence of appropriate heir, the appropriate State or the Government of India in an appropriate case became the owner of the land. Article 296 of the Constitution of India speaks about the property accruing by escheat or lapse or as an bona vacantia for want of a rightful owner.
Originally the writ petition was filed by the petitioner on 27th January, 1999 praying inter alia for quashing the Government Order dated 01st December, 1998, suitable order for conversion of land after disposal of S.L.P. No. 1157-59 of 1998 filed by the State before the Supreme Court, and orders as regards valuation, stamp duty, etc.. The Special Leave Petition arose out of a judgement and order dated 15th October, 1997 passed by the High Court in Civil Misc. Writ Petition No. 32605 of 1991 (Satya Narain Kapoor Vs. State of U.P. and others). The High Court held therein, apart from other points, 'Nazul' land can not be converted to freehold land. Ultimately the Supreme Court set aside the judgement and order of the High Court by its judgement and order dated 26th October, 2004 and remanded the matter to the High Court for consideration afresh. The Supreme Court held that the scope of the writ petition was restricted only in respect of 2 shops not for the entire 'Nazul' estate. In case the scope which was wanted to be extended, State should have been put to notice or given adequate opportunity. Some interested parties wanted to get one Government order dated 01st December, 1998 quashed in the application/s under Article 32 of the Constitution of India. The Supreme Court felt that since the order of remand is made, such petition/s be treated to be disposed of without any adjudication on merits. The writ petitioner is at liberty to pursue such other remedy as may be open and available to him and as advised. See the ratio of 2005 (1) ARC 167 [State of U.P. and another Vs. Satya Narayan Kapoor (Dead) by Lrs. And others].
After the disposal of the matter in the Supreme Court, on 25th July, 2005 the petitioner made an amendment application making various prayers about conversion of land, fixation of price, reduction of area and condition of sale, etc. along with some earlier prayers, like quashing of the aforesaid Government order dated 01st December, 1998 etc.
According to us, the prayers, which are made in the writ petition, are not alien to the writ petition originally filed. It is to be remembered that in disposing writ petitions we normally apply principles of the Code of Civil Procedure. Such Code says that amendment of pleadings can be made at any stage of the proceedings, provided amendment is necessary for the purpose of determining the real question of controversy between the parties. A further proviso is added in the recent amendment of the Code of Civil Procedure that amendment should not be allowed after trial commenced unless compelled. This is not the situation here. Therefore, when we find the amendment, which was sought for, is within the fore corners of writ, we do not find any reason to dismiss the same. Principally, law is very liberal on this point. It can not be denied on hypertechnical grounds. It would be generally allowed unless it causes prejudice which can not be compensated or the opposite party accrued any right by the lapse of time. See JT 2001 (7) SC 112 (Dondapati Narayanana Reedy Vs. Duggried by Venkatanarayanana Reedy and others). It was held in 2004 (6) SCC 415 (Pankaja and another Vs. Yellappa (dead) and others) that if the granting of an amendment really subserves the ultimate cause of justice and avoids future litigation, the same should be allowed.
The learned Standing Counsel argued the matter both on the issue of amendment and merit before the amendment has actually been effected. Hence, we felt the objection to the amendment is hypertechnical but not substantial. As such, we have allowed the amendment application earlier keeping all points open. Even thereafter excepting omnibus allegation that the petitioner wanted to amend the writ petition drastically no specific ground on the point of suffering of the respondents is available. Therefore, we do not find any further reason of discuss the issue of amendment even after allowing the same in the earlier occasion.
Hence, let us proceed with the merit.
According to the petitioner, he is the lessee of 'Nazul' land being site nos. 32-C, 139 and 139-B, situated at Civil Station, Allahabad and had applied earlier for their conversion into freehold on 22nd May, 1993, 20th March, 1995 and 11th August, 1997 before the District Magistrate, Allahabad, which are still pending. The petitioner had deposited the ground rent for the year 1998/99 of the above Nazul land vide receipt dated 18th June, 1998, and two others vide receipts both dated 04th February, 1998 respectively. The writ petition was filed on 27th January, 1999.
On 19th February, 1988 the lease of Nazul Site No. 32-C, Civil Station, Allahabad was renewed by the appropriate Commissioner, Allahabad Division, in favour of the petitioner with effect from 06th May, 1968 for a period of 90 years till 05th May, 2058. Similarly, the leases of Nazul Site Nos. 139 and 139-B, Civil Station, Allahabad were renewed in favour of the petitioner on 09th June, 1989 and 22nd May, 1993 respectively by the Collector, Allahabad both with effect from 01st January, 1972 for a period of 90 years till 31st December, 2061. Leases are to be renewed every 30 years. The petitioner had also applied to the District Magistrate, Allahabad for renewal of the aforesaid leases before expiry of the first term of 30 years of the 90 year lease vide applications dated 22nd December, 1997, 25th July, 2001 and 25th July, 2001 respectively. According to the petitioner, the aforesaid applications are also still pending.
However, the petitioner intends to develop the aforesaid sites in question after getting their plans duly sanctioned by the Allahabad Development Authority.
The Government issued an order on 25th September, 1986 saying that the nature of the Leasehold/Nazul Land(s) does not change upon acquisition. After expiry of the leasehold period Nazul land reverts back to the lessor in accordance with the terms of the lease but a fresh lease can be issued thereafter. However, recently the Supreme Court held in 2003 (3) SCC 128 (Sharda Devi Vs. State of Bihar) that the Land Acquisition Act, 1894 can not be invoked by the Government to acquire its own property. It would be an absurdity to comprehend the provisions of the Land Acquisition Act being applicable to such land wherein the ownership or the entirety of rights already vests in the State.
Meaning of perpetual lease and its renewal as defined under AIR 2004 SC 32 [State of U.P. and others Vs. Lalji Tandon (Dead)], is as follows:-
"In India, a lease may be in perpetuity. Neither the Transfer of Property Act nor the general law abhors a lease in perpetuity. Where a covenant for renewal exists, its exercise is, of course, a unilateral act of the lessee, and the consent of the lessor is unnecessary. Where the principal lease executed between the parties containing a covenant for renewal, is renewed in accordance with the said covenant, whether the renewed lease shall also contain similar clause for renewal depends on the facts and circumstances of each case regard being had to the intention of the parties as displayed in the original covenant for renewal and the surrounding circumstances. There is a difference between an extension of lease in accordance with the covenant in that regard contained in the principal lease and renewal of lease, again in accordance with the covenant for renewal contained in the original lease. In the case of extension it is not necessary to have a fresh deed of lease executed; as the extension of lease for the term agreed upon shall be a necessary consequence of the clause for extension. However, option for renewal consistently with the covenant for renewal has to be exercised consistently with the terms thereof and, if exercised, a fresh deed of lease shall have to be executed between the parties. Failing the execution of a fresh deed of lease, another lease for a fixed term shall not come into existence though the principal lessee in spite of the expiry of the term thereof may continue by holding over for year by year or month by month, as the case may be." (Emphasis supplied)
The Uttar Pradesh Government issued several Order(s) regarding conversion of Lease Hold/Nazul Land(s) into Freehold land/s vide dated 23rd May, 1992, 02nd December, 1992, 03rd October, 1994, 17th February, 1996, 28th February, 1997, 26th September, 1997 and 01st December, 1998 including Government order dated 10th May, 1995, which has a very important role to play herein.
In the light of the aforesaid Government Order dated 25th September, 1986 all Nazul Land(s) including those of the petitioner and those acquired by the Allahabad Development Authority, Allahabad and/or its predecessors (i.e. Allahabad Improvement Trust) were/are under the management of Nagar Nigam, Allahabad. The Hon'ble Supreme Court of India in the decision reported in 2001 (1) ARC 565 (District Magistrate, Allahabad and another Vs. Harminder Pal Singh and another) held that the Allahabad Development Authority, Allahabad is an offshoot of the Municipal Board/Nagar Nigam, Allahabad.
By the Government Order No. 1639/1/9/AA-1-95-80 MIS/86 dated 10th May, 1995 State had laid down a guideline for conversion of Lease hold Land(s) into Freehold, by the Uttar Pradesh Awas Evam Vikas Parishad and Development Authorities, on the terms and conditions provided therein. The Special Secretary, U.P. Government, issued the Government order from which it appears that the Development Authorities and/or Uttar Pradesh Awas Evam Vikas Parishad will charge 12% of the land valuation (i.e. 12% of the premium amount mentioned in the lease deed) as freehold conversion charges. Accordingly, conversion has been taken effect everywhere particularly at Allahabad without any restrictive covenant(s) and including the proposed area(s) affected by road widening as per the Master Plan in accordance with the Government Order.
The Allahabad Improvement Trust/Allahabad Development Authority acquired the Nazul Site No. 132, Civil Station, Allahabad having an area of 11 Acres 3,411 sq. yds., Nazul Site No. 134, Civil Station, Allahabad having an area of 8 Acres 2,902 sq. yds. and various other Nazul Site(s)/land(s) at Allahabad. Both the aforesaid Nazul Site(s) are opposite to Circuit House, Allahabad. Those were acquired in and around the year 1965 and are presently occupied by Bahuguna Market (Commercial Complex), residential plots and flats initially given on lease for a duration of 90 years and subsequently the plot(s)/land(s) were converted into freehold, by Allahabad Development Authority, Allahabad at the rate of 12% of the land valuation (i.e. 12% of the premium amount mentioned in the lease deed) as freehold conversion charges in accordance with the aforesaid Government Order dated 10th May, 1995. Few other examples are given hereunder:
A. The freehold sale deed executed by Allahabad Development Authority in favour of 'Smt. Nirmala Deora, Shri Saket Deora, Shri Samir Deora, Smt. Manjula Singh and Shri Ranvir Singh' dated 14th May, 1997 registered in Book Serial No. '1 Khand 994', Page No. '291/300', Serial No. '1434' is for Plot No. '29', admeasuring '20, 199 sq. ft.' situated in Hastings Road Awas Yojna, Allahabad leased for 90 years by Allahabad Development Authority/Allahabad Improvement Trust vide lease deed dated 28th November, 1968.
B. The freehold sale deed executed by Allahabad Development Authority in favour of 'Smt. Maya Khare and Smt. Manju Dayal' on or around 09th July, 1996 for Plot No. '35', admeasuring '16,126 sq. ft.' situated in Hastings Road Awas Yojna, Allahabad leased for 90 years by Allahabad Development Authority/ Allahabad Improvement Trust vide lease deed dated 12th December, 1967.
On 01st December, 1998 a further Government Order being No. '2268/9-AA-4-98-704N/97' of Awas Anubhag-4 was issued by the Secretary, U.P. Government. As per such Government order, two categories of freehold charges were fixed as per the land use earmarked in the prevailing Master Plan, for 'Residential' at the rate of 40% of the applicable Circle Rate of land(s) and for 'Non-Residential' at the rate of 60% of the applicable Circle Rate of land(s) and not as per the land usage mentioned in the lease deed or actual usage. The aforesaid Government Order dated 01st December, 1998 also states that a discount of 30% shall be given on the freehold amount where the Circle Rate of land(s) has been amended between 30th November, 1990 and 29th November, 1991 and further a discount of 20% on the freehold charges shall be allowed in case of one time payment.
At Allahabad the Circle Rate of land(s) were amended by the District Magistrate, Allahabad between the aforesaid period of 30th November, 1990 and 29th November, 1991 vide Order No. '351-359/STAMPS CLERK' dated 30th December, 1990 issued by Additional District Magistrate (Finance), Allahabad to the Sub-Registrar, Allahabad. As per the aforesaid order dated 30th December, 1990 the circle rates of land(s) were fixed as undermentioned on Mahatma Gandhi Marg (Nazul Site No. 32-C, Civil Station, Allahabad) at Rs. 1,000/- (Rupees One Thousand Only) per square meter, on Mayo Road (Nazul Site No. 139, Civil Station, Allahabad) at Rs. 750/- (Rupees Seven Hundred and Fifty Only) per square meter and on Dayanand Marg (Nazul Site No.139-B, Civil Station, Allahabad) at Rs. 1,000/- (Rupees One Thousand Only) per square meter. As such the 30% discount in the freehold rates in accordance with the aforesaid Government Order dated 01st December, 1998 has to be given on the aforesaid circle rates since the said circle rates were amended between 30th November, 1990 and 29th November, 1991. As per the Government Order No. '148/9-AA-4-97-30N/96/T.C.' of Awas Anubhag-4 dated 28th February, 1997 issued by the Principal Secretary, U.P. Government referred in the aforesaid Government Order dated 01st December, 1998, a discount of 20% is allowed on single payment of the freehold charges payable.
As per the Government Order No. 'K.S.V.-5-5808/11-99-500 (80)/98' of Kar Evam Sansthagat Vitta Anubhag-5 dated 11th January, 1999 issued by the Principal Secretary, U.P. Government, the stamp duty amount (registration charges) for registration of the freehold sale deed(s) is payable at the rate of 10% of the freehold charges. The U.P. Government till now has issued various Government Order(s) to continue the rebate of stamp duty amount (registration charges) for the registration of the freehold sale deed(s) without any break and the aforesaid provision for the registration of the freehold sale deed(s) at the rate of 10% of the freehold charges is applicable till date. Since the freehold sale deed(s) of the Nazul Site(s) executed by the District Magistrate(s) and the Development Authorities particularly the District Magistrate, Allahabad and the Allahabad Development Authority, Allahabad have been/are presently being registered at stamp duty amount (registration charges) of 10% of the freehold charges in accordance with the aforesaid Government Order dated 11th January, 1999 and its successive Government Order(s), the freehold sale deed(s) of the Nazul Site Nos. 32-C, 139 and 139-B, Civil Station, Allahabad should also be registered at the stamp duty amount (registration charges) of 10% of the freehold charges.
So far as the question of covenants is concerned, any restrictive covenant(s) like perpetual restriction on land use in future in the freehold sale deed(s) executed by the District Magistrate, Allahabad in light of the aforesaid Government Order dated 01st December, 1998 is illegal, since at a later date they may conflict with the land use in the Master Plan of Allahabad and open avenues for confusion and litigation. In fact, the aforesaid Government Order dated 01st December, 1998 only refers to charge freehold conversion rates at the rate of 40% and 60% of residential and non-residential prevailing land use as per the Master Plan respectively. The aforesaid Government Order dated 01st December, 1998 does not specify any restrictive covenant(s) to be imposed at the time of the freehold sale deed particularly regarding the land use in future. There are no restrictive covenant(s) in the freehold sale deed(s) executed by the Development Authorities and Uttar Pradesh Awas Evam Vikas Parishad particularly those executed by the Allahabad Development Authority, Allahabad in accordance with the Government Order dated 10th May, 1995. Likewise there should be no restrictive covenant(s) in the freehold sale deed(s) of the petitioner also in respect of freehold sale deed(s) of Nazul Site Nos. 32-C, 139, 139-B, Civil Station, Allahabad. The freehold sale deed(s) executed in accordance with the Government Order(s) dated 10th May, 1995 and 01st December, 1998 have covenant(s) regarding reference of any dispute to the Housing Department (Awas Vibhag), State of U.P. In any event where the dispute is with the State, there is every possibility of biasness on the part of the Housing Department (Awas Vibhag), State of U.P. in favour of the State of U.P. in deciding such issue. In fact neither the aforesaid Government Order dated 10th May, 1995 nor the aforesaid Government Order dated 01st December, 1998 specify any such covenant(s) to be imposed at the time of the freehold sale deed. Freehold means freehold in all respect. There can not be any question regarding future dispute to be kept open in the covenant(s). Dispute, if any, will be decided by the appropriate Court of law.
However, examples regarding recent conversion of land under the Government Order of the year 1995 are given hereunder:
A. The freehold sale deed executed by Allahabad Development Authority in favour of 'Shri Mahendra Narayan Darbari' dated 28th June, 2004 for Plot No. '350', admeasuring '377 sq. yds.' situated in Mumfordganj Awas Yojna, Allahabad leased for 90 years by Allahabad Development Authority, Allahabad/ Allahabad Improvement Trust vide lease deed dated 23rd February, 1953.
B. Even at the time of delivery of judgement by filing an affidavit the petitioner has shown that conversion is made on 09th March, 2006 in respect of Plot No. C-15, Govindpur Awas Yojna, Allahabad measuring area 162.00 square meter in favour of one Smt. Usha Mathur wife of Sri Prithviraj Singh.
The freehold sale deed(s) of the Nazul Site(s) executed by the Allahabad Development Authority, Allahabad in accordance with the aforesaid Government Order dated 10th May, 1995 include(s) the area(s) affected by road widening as per the Master Plan of Allahabad, as such the freehold sale deed(s) of the Nazul Site Nos. 32-C, 139 and 139-B, Civil Station, Allahabad should also include any area(s) affected by road widening as per the Master Plan of Allahabad. Since the nature of the Nazul Land(s) acquired by the Development Authorities and Uttar Pradesh Awas Evem Vikas Parishad particularly Allahabad Development Authority/Allahabad Improvement Trust being currently converted into freehold by them and the nature of the petitioner's Nazul Land(s) in question are similar, therefore, the aforesaid Government Order dated 10th May, 1995 should also be made applicable for conversion of the petitioner's Nazul Land(s) into freehold. Thus, likewise in accordance with the aforesaid Government Order dated 10th May, 1995, the petitioner should be allowed to get conversion of the Nazul Site Nos. 32-C, 139 and 139-B, Civil Station, Allahabad into freehold at 12% of the land valuation (i.e. 12% of the premium amount mentioned in the lease deed) as freehold conversion charges and the freehold sale deed(s) should be without any restrictive covenant(s) and should include the proposed area(s) affected by road widening as per the Master Plan.
Ultimately, the petitioner undertook to deposit freehold charges to be determined by the Court within 90 days from the date of issuance of final notice. He prayed for conversion within 30 days from such deposit.
According to the respondents, the petitioner initially filed the abovenoted writ petition challenging the Government Order dated 01st December, 1998 and in the alternative sought permission to apply conversion of Nazul Site Nos. 32-C, 139 and 139-B, Civil Station, Allahabad, after the decision of the Hon'ble Supreme Court in S.L.P. No. 1557-59 of 1998.
The petitioner, however, in the abovenoted writ petition stated that he has applied for conversion of lease hold right into freehold much before filing of the writ petition, under the earlier Government Order dated 23rd May, 1992 through his applications no. 12, 13 and 14 filed on 22nd May, 1993 before the Collector, Allahabad.
The answering respondent while processing the applications for conversion of lease hold right into freehold issued a demand note for the three properties, which were sought to be converted into freehold, requiring the petitioner to deposit the amount within a period of 90 days to avail the discount of 20% from the total amount payable under the Government Order on depositing the same within the period of 90 days. It was made clear that in the event of non-payment of the amount within 90 days, the petitioner would not be entitled to concessional rate and would have to deposit the entire amount and no discount would be made available to him. The petitioner, however, did not deposit any amount and did not avail the benefit of the policy of the Government as contained in the Government Order dated 23rd May, 1992. In the meantime the Government made certain changes in the policy and issued another Government Order dated 01st December, 1998, which has been impugned in the writ petition. The petitioner instead of applying by a fresh application under the revised policy of the Government, as contained in the Government Order dated 01st December, 1998, rushed to this Court challenging the same on the ground contained in the writ petition.The petitioner on one hand challenged the validity of the Government Order dated 01st December, 1998 and on the other hand, tried to protect his interest under the same Government Order suppressing the fact of his earlier applications and non-deposit of the amount payable for conversion of lease hold right into freehold under the Government Order dated 23rd May, 1992. The aforesaid conduct of the petitioner will certainly disentitle him to take any benefit under any of the two Government Orders for the simple reason that he did not avail the benefit of the earlier Government Order dated 23rd May, 1992 having committed default in payment of amount within the prescribed period and subsequently when another opportunity came for filing application afresh under another Government order dated 01st December, 1998, he challenged the validity of the same. It appears that the petitioner is trying to evade his liability to pay the amount required under the Government order for conversion of freehold right.
In view of the aforesaid facts the petitioner has lost his right to apply under any of the two aforementioned Government orders dated 23rd May, 1992 and 01st December, 1998. However, he has an opportunity and if he is so willing to avail, he still has a chance to apply under the Government Order dated 10th December, 2002.
The petitioner has also referred the Government Order dated 10th May, 1995 in his writ petition and sought the calculation of market value as per Rule 341(iii) of Stamp Rules, 1942, the relief as sought is wholly misconceived, inasmuch as that on the date of filing of the writ petition Rule 341 (iii) of Stamp Rules 1942 stood superseded by the U.P. Stamp (Valuation of Property) Rules, 1997.
It appears that the petitioner has never been serious in getting his lease hold right to be converted into freehold and was interested only to get an option alive, so that the most beneficial condition of the Government Order could be availed by him as last resort. The respondents in the counter affidavit contended that no person can be permitted to use and rather abuse the process of law in such unfair manner. On one hand, he is challenging the policy as a whole and on the other hand wants a benefit under the same.
In view of the facts stated above the writ petition is liable to be dismissed only on the conduct of the petitioner.
In reply the petitioner contended that the petitioner never shown any conduct from which it will be established that he was not interested to get conversion of the leasehold land to freehold. In fact, in 1992 when he had applied, he wanted to know the circle rate and its fixation. The demand notice was made but all are in vain. Before making any submission about the conduct of the petitioner, they should know their conduct before the Court of law. In spite of giving direction by the Court, for the last 5 years no counter affidavit has been filed by the respondents. For the first time when the amendment application was made and the Court, in fact, compelled them to file the affidavit, the same was filed. This reluctance on the part of the State will show how diligent they were in transferring the land from leasehold to freehold in favour of the petitioner.
We have carefully considered the respective submissions made by the learned Counsel. We have no doubt that the lease is long term lease subject to renewal time to time. There is no dispute with regard to possession of the petitioner in the leasehold land. The State, on one hand, said that the petitioner did not avail the opportunity of the Government order dated 23rd May, 1992 for the purpose of conversion of Nazul land into freehold land, but on the other hand said that the petitioner has a chance to apply under the Government order dated 10th December, 2002. The State is not interested to forfeit the right of the petitioner due to alleged lapse of time but interested to keep the bargaining position alive. Hence, it can be safely construed that the State is only interested about price. Bargaining of price is depending upon various circumstances. It is not a case where delivery of possession is yet to be given so that the Government can claim much better or higher price. Here not only possession has been given but perpetual lease has also been given to the petitioner. Therefore, for the sake of argument it can be said that landed property is virtually unrecoverable in nature. In such circumstances, a practical outlook is to be given by the executives instead of making conversion time bound. It is a matter of discussion. Assuming for the moment if the Government say that we shall not convert because of delay, if any, the petitioner will not suffer any loss but gain due to present legal position regarding perpetual lease. We mean to say that Government is not in a better bargaining position. That apart, at the stage of negotiation both the parties should be diligent. A party who is not in a better bargaining position, will have to be much more diligent. We are sorry to say that the Government was not so diligent as expected. It is not the fact that the applications were not pending as per Government order of the year 1992. But the Government took long time to review orders in between 1992 and 1998 further in between 1998 and 2002. On the other hand, keeping the applications pending Government carved out rights of some persons to give effect to Government order of the year 1995 issued in between 1992 and 1998. Therefore, when applications were pending and negotiations are going on, why they will not be facilitated at least under such Government order of the year 1995 is not known to this Court. Why they will be kept waiting and now when Government order of the year 1992 was reviewed under Government order of the year 1998, which is challenged, again another Government order of 2002 as introduced, will be directed to be applied to the petitioner, is unknown to this Court. Even though the rights of the citizens are in the nature of contractual rights, the manner, the method and motive of a decision of entering or not entering into a contract, are subject to judicial review on the touchstone of relevance and reasonableness, fair play, natural justice, equality and non-discrimination. See the ratio of AIR 1990 SC 1031 = 1990 (3) SCC 752 (Mahabir Auto Stores and others Vs. I.O.C. And others).
Save and except Government order of the year 1995 no Government order is static. All the Government orders were time to time reviewed irrespective of the factum that one of such reviewed Government order of the year 1998 was or still is subjudice before the Supreme Court or before the High Court. Government order of the year 1995 is a departure to accommodate some fortunate persons similarly placed. According to us, land belongs to the State. Any decision with regard to conversion of land from leasehold to freehold will be taken by the State. There is no doubt that the decision has already been taken and implemented. The lands, which were converted, and the lands of the petitioner, as yet to be converted, are similarly placed in the city of Allahabad within the area of the development authority. By and large the Development Authorities, Housing and Development Department, Nagar Nigam, Municipal Board are controlling the development of a city. Only to facilitate the development, different functionaries are created. By making fictitious difference a governmental authority can not carve out right of the citizens similarly placed and facilitate handful of persons. In such circumstances, similarly placed persons are also entitled to get similar benefit principally. In AIR 1987 All. 56 (Purshottam Dass Tandon and others Vs. State of U.P. Lucknow and others) similar question was discussed although the same was only in respect of leasehold sanction. Such judgement of Division Bench of the High Court was tested by the Supreme Court in 1989 Supp. (2) SCC 412 (State of U.P. and others Vs. Purshottam Das Tandon and others), but the special leave petition was dismissed with a rider that the leases will be granted subject to the provisions of Urban Land (Ceiling and Regulation) Act, 1976. Such Act is no more applicable. Therefore, the Division Bench judgement, as stands, will have binding effect on us principally. There the Division Bench held that leases in Civil Lines Allahabad constituted one class. Some might have succeeded in their life but that surely could not take them out of the class and entitle the government to treat them differently. Political strength or executivial height, economic affluence or social stature could not justify favourable treatment. It cannot be accepted as reasonable basis for picking and choosing out persons similarly situated for different treatment. The Government has failed to disclose any reason for differentiating or picking up some for grant of fresh lease and denying it to others. The action of the authorities, therefore, was violative of the basic requirement of classification being based on intelligible differentia distinguishing one person from the other. Constitutional pledge of equality is founded on ethical principle of equal opportunity and similar treatment to persons similarly situated. It ensures fairness, instils descipline and promotes rule of law the very basis and foundation of Welfare State which ensures protection of individual against arbitrary exercise of power by the Public authority. 'Do not discriminate without reason' should not only be the endeavour but should be definite and positive approach.
We are of the view that there is no basic difference of treatment in between two sections of people in transferring the land from leasehold land to freehold land. Neither before 1995 nor after 1995 any different Government order was issued to treat some persons separately. In each occasion all were treated equally excepting on one occasion i.e. in 1995. There is no explanation of the State. Therefore, it can be safely presumed that because of long delay on the part of the State either in converting the land or in issuing further Government Order, it has directly favoured its own instrumentalities and indirectly favoured few citizens eliminating others.
According to us, those who are enjoying the leasehold period or renewed or granted or applied for conversion of leasehold land to freehold land, are similarly placed. There is no intelligible differentia in between the land to be transferred by the authorities or by the District Magistrate. District Magistrate is representative of the State in respect of conversion. In AIR 1963 SC 591 (Khandige Sham Bhat Vs. Agricultural Income-tax Officer, Kasaragod and another) a Constitution Bench of the Supreme Court held that it is now well established that while Article 14 forbids class legislation, it does not forbid reasonable classification for the purposes of legislation. In order, however, to pass the test of permissible classification two conditions must be fulfilled, namely, (i) that the classification must be founded on an intelligible differentia which distinguished persons or things that are grouped together from others left out of the group and (ii) that the differentia must have a rational relation to the object sought to be achieved by the statute in question. The classification may be founded on different bases, namely, geographical, or according to objects or occupations or the like. What is necessary is that there must be a nexus between the basis of classification and the object of the Act under consideration. It is also well established that Article 14 condemns discrimination not only by a substantive law but also by a law of procedure.
Though a law ex facie appears to treat all that fall within a class alike, if in effect it operates unevenly on persons or property similarly situated, it may be said that the law offends the equality clause. It will then be the duty of the court to scrutinise the effect of the law carefully to ascertain its real impact on the persons or property similarly situated. Conversely, a law may treat persons who appear to be similarly situate differently; but on investigation they may be found not to be similarly situate. To state it differently, it is not the phraseology of a statute that governs the situation but the effect of the law that is decisive. If there is equality and uniformity within each group, the law will not be condemned as discriminative, though due to some fortuitous circumstance arising out of a peculiar situation some included in a class get an advantage over others, so long as they are not singled out for special treatment.
In AIR 1967 SC 1458 (The State of Andhra Pradesh and another Vs. Nalla Raja Reddy and others), AIR 1986 SC 1205 (Municipal Corporation of the City of Ahmedabad and others Vs. Jan Mohammed Usmanbhai and another) and AIR 2004 SC 361 (Saurabh Chaudri and others Vs. Union of India and others) consecutively the Constitution Bench held so. In between the period of the aforesaid judgements in AIR 1989 SC 903 (Deepak Sibal Vs. Punjab University and another) and AIR 2003 SC 1696 (State of Haryana and another Vs. Jai Singh) the Supreme Court similarly held in connection with the point of intelligible differentia. It is to be remembered that if there is no intelligible differentia, it will have to be hit by the Article 14 of the Constitution of India. Article 14 has been discussed in several judgements. The basic principle of Article 14 is that it is not an ordinary law. It is a command issued by the Constitution to the State as a matter of public policy with a view to implement its object of ensuring the equality of status and opportunity which every Welfare State, such as India, is by her Constitution expected to do and no person can, by any act or conduct, relieve the State of the solemn obligation imposed on it by the Constitution. It is applicable in the case of Government, legislature of each of the States and all local and other authorities within the territory of India and under the control of Government of India and States. Article 14, therefore, is an injunction to both the legislative as well as the executive organs of the State and the other subordinate authorities. Furthermore, the use of the word "any person" in Article 14 in the context of legislation in general or executive action affecting group rights is construed to mean persons who are similarly situated. The classification of such persons for the purpose of testing the differential treatment must, of course, be intelligible and reasonable-- the reasonableness being determined with reference to the object for which action is taken. This is the law which has been settled by the Courts in a series of decisions. If a legislation is discriminatory and discriminates one person or class of persons against others similarly situated and denies to the former the privileges that are enjoyed by the later, it can not but be regarded as "hostile" in the sense that it affects injuriously the interests of that person or class. The truth is that it is impossible to be precise, for we dealing with intangibles and though the results are clear it is impossible to pin the thought down to any precise analysis. Article 14 sets out an attitude of mind, a way of life, rather than a precise rule of law. Where an Act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law. Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment. A narrow pedantic or lexicographic approach should not be encouraged. A statute or statutory rule or rules or orders affecting the civil rights or resulting in civil consequences would have to answer the requirement of Article 14. There is an obvious difference in the contracts between private parties and contract to which the State is the party. Private parties are concerned only with their personal interest whereas the State while exercising its powers and discharging its functions, acts indubitably as is expected of it for public good and public interest. The impact of every State action is also on public interest. This factor alone is sufficient to import at least the minimal requirements of public law obligations and impress with this character the contracts made by the State or its instrumentality. No doubt, it is for the person alleging arbitrariness who has to prove it. This can be done by showing in the first instance that the impugned State action is uninformed by reason inasmuch as there is discernible principle on which it is based or it is contrary to the prescribed mode of exercise of the power or is unreasonable. If this shown, that burden is shifted to the State to repeal the attack by disclosing the material and reasons which led to the action being taken in order to show that it was an informed decision, which was reasonable. If after a prima facie case of arbitrariness is made out, the State is unable to show that the decision is an informed action which is reasonable, the State action must perish as arbitrary. This guiding principles are obtained by this Court from the laid down principles in the judgements reported in AIR 1959 SC 149 (Basheshar Nath Vs. Commissioner of Income-tax, Delhi and Rajasthan and another); AIR 2003 SC 355 (T.M.A. Pal Foundation and others Vs. State of Karnataka and others) (Constitution Bench); AIR 1952 SC 75 (The State of West Bengal Vs. Anwar Ali Sarkar and another); AIR 1963 SC 591 (Khandige Sham Bhat Vs. Agricultural Income-tax Officer, Kasaragod and another); AIR 1956 SC 479 (Bidi Supply Co., Vs. Union of India and others) (Constitution Bench); AIR 1978 SC 597 (Smt. Maneka Gandhi Vs. Union of India and another) (Constitution Bench); AIR 1974 SC 555 (E.P. Royappa Vs. State of Tamil Nadu and another) (Constitution Bench); AIR 2002 SC 2914 (M/s. Lakshmi Precision Screws Ltd. Vs. Ram Bahagat); AIR 1991 SC 537 (Kumari Shrilekha Vidyarthi etc. etc. Vs. State of U.P. and others); 1994 (2) SCC 387 (Dr. A. Franklin Joseph Vs. State of T.N. And others).
It is to be remembered that there is no whisper in the counter affidavit why a separate treatment has been made to some other persons under the Government order of the year 1995 leaving aside large number of persons similarly placed. Therefore, in spite of having prima facie case of the petitioner when the State is silent, it should be presumed that it has no answer to that extent. Having so, State action not to treat the similarly placed persons alive under the Government order of 1995 is violative of the principles laid down under Article 14 of the Constitution of India, thereby arbitrary.
The State in exercise of its executive power is charged with the duty and the responsibility of carrying on the general administration of the State. So long as the State Government does not go against the provisions of the Constitution or any law, the width and amplitude of its executive power can not be circumscribed. If there is no enactment covering a particular aspect, certainly the Government can carry on the administration of issuing administrative directions or instructions until the legislature makes a law in that behalf. It is well settled principle as we find from AIR 1955 SC 549 (Rai Sahib Ram Jawaya Kapur and others Vs. The State of Punjab) and AIR 1982 SC 33 (M/s. Bishamber Dayal Chandra Mohan etc. etc. Vs. State of U.P. and others etc. etc.). Therefore, as per such ratio the wide amplitude of the executive power issued time to time in respect of conversion of the leasehold land to freehold land or for extension of leasehold period can not be circumscribed by solitary Government order dated 10th May, 1995 only for the purpose of conversion of lands and buildings allotted on lease under the scheme of Awas Evam Vikas Parishad and Development Authorities. So long as written law is not available, the executives are empowered to act on the reasonable executive directions or instructions. It can not be inconsistent with or in derogation of the fundamental rights not only under Article 14 but under Article 13 of the Constitution of India. AIR 1955 SC 334 (D.P. Joshi Vs. State of Madhya Bharat and another) is giving indication as regards applicability of Article 13 and 14 both in an appropriate circumstance. Article 13 (1) (3)(a) says that "law" includes any Ordinance, order, bye-law, rule, regulation, notification, custom or usages having in the territory of India the force of law. It also prescribes for applicability. It is also available under Article 13 (2) that the State shall not make any law which takes away or abridges the rights conferred by this Part and any law made in contravention of this clause shall, to the extent of the contravention, be void. If a collective meaning is given placing Article 13 in the present factual context, it is to be seen that the Government order/s are the law for the time being in connection with conversion, which can not take away or abridge the rights of the citizens equally placed. Therefore, to facilitate some persons under a separate Government order of 1995 is unequal amongst the equals. Such Government order is static, others are reviewable. There is no intelligible classification to distinguish the claim of the petitioner, who applied for conversion before the District Magistrate. In other words, there is no rationality to the object sought to be achieved. There should not be any unreasonable discrimination between persons or properties either by classification or lack of classification. If we take flavour of a Constitution Bench judgement reported in AIR 1967 SC 1458 (The State of Andhra Pradesh and another Vs. Nalla Raja Reddy and others) we shall get the answer. Every discretionary powers vested in the executives should be exercised in a just, reasonable and fair way. That is the essence of the rule of law. We can also take the parameters of consideration of the Supreme Court judgement reported in AIR 1991 SC 1902 (Bangalore Medical Trust Vs. B.S. Muddappa and others) in this regard. Any instrumentality or agency of the Government, in exercise of power or discretion, would be subject to the same constitutional or public law limitations as Government. The ratio of AIR 1979 SC 1628 (Ramana Dayaram Shetty Vs. The International Airport Authority of India and others) says so. The petitioner has filed the writ petition in 1999 for quashing the Government order dated 01st December, 1998 along with various other reliefs. Therefore, the claim of the petitioner is crystallised when the writ petition was instituted. In AIR 1988 SC 2031 (Atma Ram Mittal Vs. Ishwar Singh Punia) it was held that it is well settled that no man should suffer because of the fault of the Court or delay in the procedure. Crystallising the claim on the date of institution of any proceeding is a meaningful interpretation in connection with the effectivity of law. In AIR 1990 SC 897 (Suresh Chand Vs. Gulam Chisti) it was held that the words "on the date of commencement of this Act" in relation to the pendency of the suit would mean the date when such suit was instituted. The proceeding is continued for a period and a benefit of such period is given. The Supreme Court discouraged the argument that to put it differently if a proceeding is disposed of after a considerable period, benefit will be given till such time. In AIR 1986 SC 210 (B. Prabhakar Rao and others, etc. Vs. State of Andhra Pradesh and others etc. etc.) it was held that it is open to the Court to give retrospectivity to a legislation to which the legislature plainly and expressly refused to give retrospectivity, because unlike United Kingdom, India has a written Constitution which confers justiciable fundamental rights and so that very refusal to make an Act retrospective or the non-application of the Act with reference to a date or to an event that took place before the enactment may, by itself, create an impermissible classification justifying the striking down of the non-retroactivity or non-application clause, as offending the fundamental right to equality before the law and the equal protection of the laws. In AIR 2001 SC 3580 (M/s. Ambalal Sarabhai Enterprises Ltd. Vs. M/s. Amrit Lal & Co. and another) it was held that repeal of a statute, which is not retrospective in operation, does not prima facie affect the pending proceedings which may be continued as if the repealed enactment were still in force. AIR 1987 SC 2284 (Nand Kishore Marwah and others Vs. Smt. Samundri Devi) says that it is well settled that the rights of the parties will be determined on the basis of the rights available to them on the date of the suit. Again in AIR 2002 SC 2087 (Raminder Singh Sethi Vs. D. Vijayarangam) we find that the new Act can not be given retrospective effect. The State is claiming the right under the Government Order of the year 2002 when admittedly the writ petition is pending. In this context it is to be remembered that after filing of the writ petition, the State took at least 5 years' time to file counter. The affidavit was filed sometimes in 2005 long after 2002, therefore, how the respondents can claim any such right, is unknown to this Court.
Factually, the petitioner made the applications for conversion prior to Government orders of the year 1998 or 2002 i.e. on 22nd May, 1993, 20th March, 1995 and 11th August, 1997 in respect of land being site nos. 32-C, 139 and 139-B, Civil Station, Allahabad. According to the State, all such applications were made on 22nd May, 1993 being application nos. 12, 13 and 14 as per Government order dated 23rd May, 1992. Therefore, such applications were made even before the given dates by the petitioner as per the State itself. According to the State, a period of 90 days was given to the petitioner for giving 20% discount of the conversable rate of the land. Further according to the State, the petitioner can not get discount after the period of 90 years. But no communication was made by the State to the petitioner by saying that his applications are lapsed and thereby cancelled. The State is trying to develop his case by filing an affidavit after a long lapse of 5 years period. They made an evasive statement that 'in the meantime' Government order of the year 1998 came into force. Therefore, the State is trying to say that in view of the reviewed Government order of the year 1998, the earlier applications will be automatically lapsed or treated to be cancelled. According to us, that can not be so impliedly. Retrospective operation of law must have to be specific. Therefore, the petitioner rightly challenged the reviewed Government order of the year 1998 in this writ petition. It is far to give effect of the further reviewed Government order of the year 2002, which was made during the pendency of the writ petition challenging the Government order of the year 1998. The petitioner's case is that his demand notice about fixation of circle rate as per Government order of the year 1992 was unreplied. The State has not given any answer to such submission. Therefore, the negotiation between the State and the petitioner was subsisting. It is well settled by now that if a Governmental action even in the matters of entering or not entering into contracts, fails to satisfy the test of reasonableness, the same would be unreasonable. Hence, the subsequent reviewed Government order/s can not automatically take away the prevailing right of the petitioner.
The next question is about applicability of Government order of the year 1995. The stand of the State appears to be surprising. It is stated that since the petitioner did not avail the benefit under the Government order dated 10th May, 1995, he can not claim that he is entitled to conversion as per the Government order of the year 1995. It is settled proposition of law that every subsequent Government order alters, amends, modifies or supersedes the earlier Government order and it is last Government order on the subject which prevails. This is absolutely clear from a bare perusal of the Government order dated 10th December, 2002. Since the petitioner has no right independent of the aforesaid Government order, he can not insist that the superseded Government order of the year 1995 would govern.
Firstly, the applicability of the Government order of the year 1995 in the case of the petitioner is an issue before the Court since it has made for a class of persons similarly placed. We have made long discussion on this issue on the basis of several judgements. Therefore, unless the Court declares, such Government order of the year 1995 can not be made applicable to the petitioner. Secondly, if this Court accepts submission of the State that the petitioner did not avail the opportunity under the Government order of the year 1995, then it should be construed as an admission on the part of the State that the Government order of the year 1995 is equally applicable in the case of the petitioner. Thirdly, the Government order of the year 1995 never reviewed. It has been kept applicable and given effect even in 2004 and 2006 as available from the available materials.
Therefore, the logical conclusion is that when there is no formal rejection of the applications made by the petitioner as per the Government order of the year 1992, the same exist. The Government orders as reviewed time to time in the year 1998, which is under challenge, and the Government order of the year 2002, which was introduced during the pendency of the proceeding, appear to be prospective in nature. However, to avoid the controversy that the review of the Government order takes away right of the earlier Government order, we are of the view that the unreviewed Government order dated 10th May, 1995, which has been given effect till date, as aforesaid, can be principally made applicable to the petitioner in all respect.
Therefore, the writ petition is allowed. For the purpose of conversion of respective Nazul Site Nos. 32-C, 139 and 139-B, Civil Station, Allahabad from leasehold to freehold to the petitioner by the State the Government Order No. 1639(1)/9-AA-1-95-80--/86 dated 10th May, 1995 will be principally applicable to the petitioner in all respect including the circle rate, stamp duty for registration subject to Governor's available notification for relaxation, road widening as per the master plan etc. Accordingly a demand notice will be issued by the State within a period of fortnight from the date of communication of this order. Deposit of freehold charges will be made by the petitioner to the State authority within a period of 90 days from the date of such demand notice. Formal conversion upon registering the document will be made by the authority within a period of 30 days from the date of such deposit.
However, no order is passed as to costs.
(Justice Amitava Lala)
(Justice Shiv Shanker)
Dated: 30th March, 2006.
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