# K.K. BHALLA v. STATE OF M.P. AND ORS

- **Citation:** [2006] 1 S.C.R. 342
- **Court:** Supreme Court of India
- **Decided:** 2006-01-13
- **Case number:** Civil Appeal Nos. 477 of2006
- **Bench:** S.B. Sinha, P.P. Naolekar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/k-k-bhalla-v-state-of-m-p-and-ors-21072
- **Pages:** 25

## Headnote

Town Planning:
Madhya Pradesh Nagar Tatha Gram Nivesh Adhinzvam. 1973:
lands, buildings and other developmental works·-Power of disposalWrit petitions, in the nature ofpublic interest litigations. were.filed questioning
allotment of lands in favour of a Newspaper industry and YMCA-lands in
question came within the Master Plan made in terms of the 1973 Act-The
D lands in question were situated in the commercial area carved out of the said
Master Plan-Validity of-Held: The power of disposal of lands, buildings
and other developmental works indisputably vests in the JOA·- The State and
the JOA being creatures of the statute were bound to act within the fourcorners thereof-So far as the allotment of land is concerned. the purpose for
which the same is a/lolled would be wholly irrelevant if it contravenes the
E mandatory provisions of the statute or the statutory rule· Disposal of the
authority land is within the domain of the JOA, subject on(l' to the previous
approval of the State Government-State has no power to interfere 11-ith the
day to day functioning of the JOA-Hence allolment set aside-JOA direc/ed
lo consider allotmenl of land to privale persons in lerms of the provisions of
F the 1973 Ac/ and the Rules framed thereunder as also keeping in view 1he
Mas/er Plan-Madhya Pradesh Nagar Tatha Gram Nivesh Vikasil Bhoomiyo,
Griho, Bhavanothalha Anya Sanrachnaon Ka Vyayan N(1•am. 1975 Rr. 3, 4,
5 19 and 20.
Writ petitions, in the nature of pubic interest litigation, were filed
G by the appellant before the High Court questioning allotment of lands in
favour of a Newspaper industry and YMCA, private respondents
respectively by the respondent-State. The lands in question indisputably
came within the Master Plan made in terms of the Madhya Pradesh Nagar
Tatha Gram Nivesh Adhiniyam, 1973 in relation to the town of Jabalpur
brought about by the Jabalpur Development Authority (JDA), a statutory
H
342
'I
..
"
~
~
K.K. BHALLA v. STATE OF M.P.
343
authority constituted thereunder. The lands in question were situated in A
the commercial area carved out of the said Master Plan.
Before the High Court the appellant contended that a proposal was
made for the construction of an auditorium and a cinema hall by the
authority and that the allotments made in favour of the private
respondents were in contravention of the Master Plan drawn in terms of B
the provisions of the 1973 Act.
The High Court dismissed the writ petitions holding that the grants
in favour of the private respondents were made for public purposes which
the State was empowered to do so in terms of the Madhya Pradesh Nagar
Tatha Gram Nivesh Vikasit Bhoomiyo, Griho, Bhavanothatha Anya c
Sanrachnaon Ka Vyayan Niyam, 1975. Hence the appeal.
Allowing the appeal, the Court
HELD: I. The State in terms of the provisions of the Madhya
Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973 and the Madhya D
Pradesh Nagar Tatha Gram Nivesh Vikasit Bhoomiyo, Griho,
Bhavanothatha Anya Sanrachnaon Ka Vyayan Niyam, 1975 is a statutory
authority. Its jurisdiction to oversee functions of the authorities of the
Board as also power to issue directions are circumscribed by the provisions
contained in Sections 72 and 73 of the 1973 Act. (355-F-G I
E
2. Concededly, the lands in question were either acquired lands or
nazul lands. It also stands admitted that in terms of the provisions of
Section 71(2) of the Madhya Pradesh Town Improvements Trust Act, 1960
even the nazul lands stand admittedly vested in the authority and having
regard to the provisions contained in Section 87(l)(c)(iii) all assets and
F
liabilities of the Town Improvement Trust shall belong to and be deemed
to be the assets and liabilities of the Town and Country Development
Authority established in place of such Town Improvement Trust.
[355"F-G[
3. The power of disposal of lands, buildings and other developmental G
works indisputably vests in the Town and Country Development Authority
i.e. the Jabalpur Development Authority (JOA). It has not b

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A
B
c
K.K. BHALLA
v.
STATE OF M.P. AND ORS.
JANUARY 13, 2006
[S.B. SINHA AND P.P. NAOLEKAR, JJ.]
Town Planning:
Madhya Pradesh Nagar Tatha Gram Nivesh Adhinzvam. 1973:
lands, buildings and other developmental works·-Power of disposalWrit petitions, in the nature ofpublic interest litigations. were.filed questioning
allotment of lands in favour of a Newspaper industry and YMCA-lands in
question came within the Master Plan made in terms of the 1973 Act-The
D lands in question were situated in the commercial area carved out of the said
Master Plan-Validity of-Held: The power of disposal of lands, buildings
and other developmental works indisputably vests in the JOA·- The State and
the JOA being creatures of the statute were bound to act within the fourcorners thereof-So far as the allotment of land is concerned. the purpose for
which the same is a/lolled would be wholly irrelevant if it contravenes the
E mandatory provisions of the statute or the statutory rule· Disposal of the
authority land is within the domain of the JOA, subject on(l' to the previous
approval of the State Government-State has no power to interfere 11-ith the
day to day functioning of the JOA-Hence allolment set aside-JOA direc/ed
lo consider allotmenl of land to privale persons in lerms of the provisions of
F the 1973 Ac/ and the Rules framed thereunder as also keeping in view 1he
Mas/er Plan-Madhya Pradesh Nagar Tatha Gram Nivesh Vikasil Bhoomiyo,
Griho, Bhavanothalha Anya Sanrachnaon Ka Vyayan N(1•am. 1975 Rr. 3, 4,
5 19 and 20.
Writ petitions, in the nature of pubic interest litigation, were filed
G by the appellant before the High Court questioning allotment of lands in
favour of a Newspaper industry and YMCA, private respondents
respectively by the respondent-State. The lands in question indisputably
came within the Master Plan made in terms of the Madhya Pradesh Nagar
Tatha Gram Nivesh Adhiniyam, 1973 in relation to the town of Jabalpur
brought about by the Jabalpur Development Authority (JDA), a statutory
H
342
'I
..
"
~
~
K.K. BHALLA v. STATE OF M.P.
343
authority constituted thereunder. The lands in question were situated in A
the commercial area carved out of the said Master Plan.
Before the High Court the appellant contended that a proposal was
made for the construction of an auditorium and a cinema hall by the
authority and that the allotments made in favour of the private
respondents were in contravention of the Master Plan drawn in terms of B
the provisions of the 1973 Act.
The High Court dismissed the writ petitions holding that the grants
in favour of the private respondents were made for public purposes which
the State was empowered to do so in terms of the Madhya Pradesh Nagar
Tatha Gram Nivesh Vikasit Bhoomiyo, Griho, Bhavanothatha Anya c
Sanrachnaon Ka Vyayan Niyam, 1975. Hence the appeal.
Allowing the appeal, the Court
HELD: I. The State in terms of the provisions of the Madhya
Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973 and the Madhya D
Pradesh Nagar Tatha Gram Nivesh Vikasit Bhoomiyo, Griho,
Bhavanothatha Anya Sanrachnaon Ka Vyayan Niyam, 1975 is a statutory
authority. Its jurisdiction to oversee functions of the authorities of the
Board as also power to issue directions are circumscribed by the provisions
contained in Sections 72 and 73 of the 1973 Act. (355-F-G I
E
2. Concededly, the lands in question were either acquired lands or
nazul lands. It also stands admitted that in terms of the provisions of
Section 71(2) of the Madhya Pradesh Town Improvements Trust Act, 1960
even the nazul lands stand admittedly vested in the authority and having
regard to the provisions contained in Section 87(l)(c)(iii) all assets and
F
liabilities of the Town Improvement Trust shall belong to and be deemed
to be the assets and liabilities of the Town and Country Development
Authority established in place of such Town Improvement Trust.
[355"F-G[
3. The power of disposal of lands, buildings and other developmental G
works indisputably vests in the Town and Country Development Authority
i.e. the Jabalpur Development Authority (JOA). It has not been informed
as to whether any regulation has been framed by the authority for
regulating the procedure for disposal of developed lands, houses, buildings
and other structures. However, the lands in question are developed lands.
The right to dispose of such lands, therefore, vests in the J DA. Such a right H
344
SUPREME COURT REPORTS
[2006] I S.C.R.
A being subject to the rules made by the State, the provisions thereof may
be closely examined. (356-A-B(
4. The right to transfer land on concessional terms, thus, is subject
to two limitations, viz., (i) approval of the State is required therefor; and
(ii) no lease on concessional terms shall be allowed for purposes other than
B charitable purposes such as hospital, educational institutions and
orphanages; which implies that in a given situation a lease may be granted
on concessional terms to any other institution but therefor sufficient and
cogent reasons must be assigned. (356-E-F(
5. JOA, therefore, only had requisite authority to initiate the
C proceedings for grant of lease of land on concessional terms wherefor only
the previous approval of the State was required to be taken. The State,
except for grant of previous approval to the proposal of the JOA and
ultimate grant of lease of its land on concessional terms, has no other role
to play. Disposal of the authority land is, thus, within the domain of the
D JOA, subject only to the previous approval of the State Government.
(356-F-G(
6. The State and the JOA being creatures of the statute were bound
to act within the four-corners thereof. Procedures for disposal of land
having been laid down in the rules, power in that behalf was required to
E be exercised strictly in conformity therewith and de' hors the same.
(356-H; 357-A-BI
7. It is not in dispute that the land within the Scheme was reserved
for auditorium and cinema hall (for public and semi-public purposes) at
city level. Purported policy by the State was adopted on 10.8.1995 only.
p
Pursuant to or in furtherance of the said policy decision, a decision was
taken to allot the land on 14.10.1995. It is only on 21.11.1995 the State
allotted the land in question in favour of the private respondent stating
that the land is a Government land. (357-D-E(
8. It is also accepted that the land was allotted for the purpose of
G establishing a printing press and publication of a newspaper. It is also
curious to note that despite the allotment, the quantum of premium and
annual rent was not fixed. (358-C-D(
9. I. So far as allotment of land in favour of YMCA is concerned the
Revenue Department had also issued a circular dated 31.5.1996.
fl
(360-A-BI
'(
•
(
K.K. BHALLA v. STATE OF M.P.
345
j
9.2. The said circular also could not have been issued in terms of A
,/
the 1973 Act. Even otherwise, not more than 5,000 Sq. ft. of land could
have been allotted thereunder. The impugned order, thus, ex facie suffers
from total non-application of mind on the part of the authorities of the
JDA and the State. The State, moreover, has acted beyond its authority.
1360-E-FI B
to. The State itself opined that the land in question is 'Authority
-\
Land'. It, therefore, could not do what is within the domain of the JDA.
1360-FI
11. The purpose for which allotments were made may be wellmeaning, but the allotments being contrary to the provisions of the Act c
and the Rules were void and of no effect being illegal. 1360-F-G I
12. So far as the allotment ofland is concerned, the purpose for which
the same is allotted would be wholly irrelevant if it contravenes the
mandatory provisions of the statute or the statutory Rule. 1360-G-HI
D
Oil and Natural Gas Commission v. Association of Natural Gas
Consuming Industries of Gujarat, 119901 Supp. SCC 397, referred to.
13. If any preference is to be given to any public utility service, a
policy decision therefor was required to be adopted by the JDA if
permissible under the statute and not otherwise. Even the State may not E
have a role to play in the matter under the Act. General policy decision
adopted by the State in the absence of a provision of the statute cannot
ipso facto be held to be applicable to JDA. 1361-E-FI
~
Bennett Coleman & Co. v. Union of India, 119721 2 SCC 788, Indian
Express Newspapers (Bombay Private ltd) v. Union of India, 11985) 1 SCC F
64 I and Bangalore Development Authority v. R. Hanumaiah, (2005) 8 SCALE
80, relied on.
Hindustan Petroleum Corpn. ltd v. Darius Shapur, Chennai, (2005) 7
SCALE 386, Commissioner of Police v. Gordhandas Bhanji, AIR (1952) SC
16 and Bahadursinh lakhubhai Gohil v. Jagdishbhai M. Kamalia 120041 2 G
sec 65, cited.
-
;
14. Both the State and the JDA have been assigned specific functions
under the statue. The JDA was constituted for a specific purpose. It could
not take action contrary to the scheme framed by it nor take any action
which could defeat such purpose. The State could not have interfered with H
346
SUPREME COURT REPORTS
[2006[ I S.C.R.
A the day to day functioning ofa statutory authority. Section 72 of the 1973
Act authorizes the State to exercise superintendence and control over the
acts and proceedings of the officers appointed under Section 3 and the
authorities constituted under the Act but thereby the State cannot usurp
the jurisdiction of the Board itself. The Act does not contemplate any
B independent function by the State except as specifically provided therein.
(362-E-G(
15. The Development Plan was prepared in terms of the 1973 Act
and the Rules framed thereunder. h has not been shown that change of
user is permissible under the Act or the Rules. In the absence of such a
C provision and/or without following the statutory requirements therefor,
if any, the State in exercise of its executive power could not have directed
that the lands meant for use for commercial purposes may be used for
industrial purposes. [362-G-H; 363-A-B[
Friends Colony Development Cammi/lee v. Stale of Orissa, [2004[ 8
D sec 733, relied on.
16. Furthermore, in terms of Section 73 of the 1973 Act, the power
of the State Government to issue direction to the officers appended under
Section 3 and the authorities constituted under the Act is confined only
to matters of policy and not any other. Such matters of policy yet again
E must be in relation to discharge of duties by the officers of the authority
and not in derogation thereof. [363-F-G[
17. The State has no power to issue any general direction. The State
has furthermore no power to interfere with the day to day functioning of
the JDA. Any such direction by the State to the officers must be in
F discharge of their duties in terms of the provisions of the Act and not
otherwise. [363-G-HI
18. The purported policy decision adopted by the State as regards
allotment of land to the newspaper industries or other societies was not a
decision taken by the appropriate Ministry. If a direction was to be issued
by the State to the JDA, it was necessary to be done on proper application
G of mind by the cabinet, the concerned Minister or by an authority that is
empowered in that behalf in terms of the Rules of the Executive Business
framed under Article 166 of the Constitution of India. Such a direction
"'
could not have been issued at the instance of the Chief Minister or at the
instance of any other officer alone unless it is shown that they had such
H authority in terms of the Rules of the Executive Business of the State. It
-
{.
. ..,,
K.K. BHALLA v. STATE OF M.P.
347
has not been shown that the Chief Minister was the appropriate authority A
to take a decision in this behalf. The purported policy decision is in respect
of the lands belonging to the State and not those belonging to the JOA.
The said policy decision applies to the entire State of Madhya Pradesh. It
is not appreciable in relation to such lands which come within the purview
of any Scheme framed under the Act. It was issued by the Revenue
Department under Revenue Book Circular Four-I. Evidently therefor no B
decision has been taken by the State in terms of the provisions of the 1960
Act or the 1973 Act. The concerned Ministry was the Ministry of Housing
and Environment. The jurisdiction of the State while exercising the power
to issue direction in this behalf is extremely limited. 1364-A-EI
Rakesh Ranjan Verma v. State of Bihar, 119921 Supp. 2 SCC 342, UP. C
State Electricity Board v. Ram Autar, 119961 8 SCC 506 and Bangalore
Development Authority v. R. Hanumaiah, (2005) 8 SCALE 80, relied on.
19. The private respondents complained of discrimination on the
ground that persons similarly situated have been allotted land at a
concessional rate but therefor no factual foundation had been laid. When D
an allotment is illegal, Article 14 which carries with it a positive concept
would have no application. 1364-F-GI
Jallandhar Improvement Trust v. Sampuran Singh. I l 9991 3 SCC 494
and State of Bihar v. Kameshwar Prasad Singh, 120001 9 SCC 94, relied on. E
20. Malice may either be on fact or in law. Passing of an order for
unauthorized purpose constitutes malice in law. 1365-B-CI
Punjab State Electricity Board Ltd. v. Zora Singh, 120051 6 SCC 776
and U.O.J. the Govt. of Pondicherry v. Ramakrishna, JT (2005) 9 SC 422,
relied on.
21. Furthermore, when the State has framed Rules and adopted a
procedure for disposal of the land, both the State and the JOA were bound
thereby. They could not have taken any action contrary thereto or
inconsistent therewith. 1365-C-DI
22. Both the State and the JOA had evidently been acting under some
misconception. The Board was of the opinion that in relation to nazul land,
the State is the final authority to allot land as the power of sanction lies
within its domain. The State did not have any such power. The State, even
in terms of Rule 3 of the 1975 Rules, has a limited role to play. (365-D-EI
F
G
H
348
SUPREME COURT REPORTS
(2006] I S.C.R.
A
23. It is well-settled that if an illegality is brought to the notice of
the Court, it can, in certain situations, exercise its power of judicial review .
suo moto. (366-C-D(
Sham Lal v. Atme Nand Jain Sabha, (1987( I SCC 222, Chairman &
MD. BPL ltd. v. S.P. <Jururaja, (2003( 8 SCC 567 and Guruvayoor
B Devaswom Managing Committee v. CK.Rajan, (2003( 7 sec 546, relied on.
24. The interest of justice would be sub served if the question as
regards allotment of land is left to the Jabalpur Development Authority.
The Authority may consider the matter afresh for grant of such allotment
C in favour of the Private Respondents treating the applications filed by them
either before it or before the State Government as fresh applications. Such
applications must be processed strictly in terms of the provisions of the
1973 Act and the Rules framed thereunder as also keeping in view the
Master Plan. (366-E-F(
0
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 477 of2006.
From the Judgment and Order dated 21.8.2002 of the High Court of
Madhya Pradesh in W.P. No. 4570/96.
WITH
E
Civil Appeal No. 478 of 2006.
Shiv Sagar Tiwari, Amalpushp Shroti and Prakash Shrivastava for the
Appellant.
Vivek K. Tankha, Anoop G. Chaudari, Satya N. Prajapati, Sidharth
F Chouhan, Prashant Kumar, B.S. Banthia, Ms. Musharraf Choudhary, Anis
Suhrawardy, Mrs. Junee Chaudhari, Ms. Sumeeta Chaudhari, J.K. Chawla
and P.K. Bajpai for the Respondents.
The Judgment of the Court was delivered by
G
S.B. SINHA, J. Leave granted in S.L.Ps.
Both these appeals involving common questions of law and fact were
taken up for hearing together and are being disposed of by this common
judgment.
H
Two Writ Petitions in the nature of public interest litigations were filed
,
'"-·
r
K.K. BHALLA v. STATE OF M.P. [SINHA. J.]
349
_.)
by the Appellant herein before the High Court questioning allotment of lands A
measuring 20000 sq. feet and 8000 sq. feet in favour of Sh. Bishambhar
Dayal Aggrawal, proprietor Dainik Bhaskar Newspaper, Jabalpur and YMCA,
private respondents herein respectively by the State of Madhya Pradesh.
Jabalpur Development Authority (JDA).
B
The lands in question indisputably come within the Master Plan made
t
in terms of the Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973
.,
(for short 'the 1973 Act") in relation to the town of Jabalpur brought about
by the Jabalpur Development Authority (for short "JOA"), a statutory authority
constituted thereunder. Prior to coming into force of the 1973 Act, the c
legislature of the State of Madhya Pradesh enacted the Madhya Pradesh
Town Improvement Trusts Act, 1960 (for short "the 1960 Act") in terms
whereof Jabalpur Improvement Trust was created for the purpose of carrying
out the provisions thereof in the town of Jabalpur wherefor it was entitled to
acquire lands belonging to private parties and obtain such land from the State
"I
and others by way of agreement, sale etc. There appears to be some dispute D
~
as to whether the lands in question are acquired lands or nazul lands belonging
to the State of Madhya Pradesh. However, it is not in dispute that the town
planning scheme framed by the said trust was approved by the State and by
a notification dated 20th September, 1974, the lands stood vested in the trust
in terms of sub-section (2) of Section 71 of the 1960 Act.
E
The lands in question are situate in the commercial area carved out of
the said Master Plan. The authority indisputably was entitled to allot plots in
,.J
favour of the applicants only in terms of the rules and regulations framed
thereunder. Allegedly, pursuant to or in furtherance of a purported policy
decisions adopted by it, the State of Madhya Pradesh allotted land to Sh. F
Bishambhar Dayal Aggrawal, proprietor of 'Dainik Bhaskar', a newspaper
inter alia published from Jabalpur for establishment of an industry, i.e., for
printing and publication of a newspaper known as Dainik Bhaskar. The said
newspaper is published from nine states. Similarly, an application having
been made by YMCA which is said to be a charitable organization, 8000 sq.
feet of land was allotted to it.
G
,
J
The Appellant herein in the writ petition filed before the High Court
inter alia pleaded that a proposal was made for construction of an auditorium
and a cinema hall by the authority with the cooperation of the M.P. Films
Development Corporation wherefor foundation stone was also laid at the site H
which has since been allotted in favour of Shri Bishambhar Dayal Aggrawal.
350
SUPREME cot:RT REPORTS
[20061 1 S.C.R.
A
Further contentions of the Appellants before the High Court are as
under:-
Such allotment having been made on a pick and choose method without
following the procedures laid down therefor and without issuing any
advertisement was illegal. Such allotment havir15 moreover been made for
B industrial purpose, was in contravention of the Master Plan drawn in terms
of the provisions of the 1973 Act as thereby change of purpose as regard user
thereof has been effected. Even 50% rebate both in respect of the premium
and ground rent was given in utter violation of the statutory provisions.
C
The contention of the Respondent before the High Court, on the other
hand, was that the said allotments were made in terms of a policy decision
adopted by the State.
The High Court by reason of the impugned judgments dismissed the
writ petitions filed by the Appellants herein holding that the grants in favour
D of the Respondents were made for public purposes which the State was
empowered to do in terms of Rule 3 of the Madhya Pradesh Nagar Tatha
Gram Nivesh Yikasit Bhoomiyo, Griho, Bhavanotatha Anya Sanrachnaon Ka
Yyayan Niyam, 1975 (for short "the 1975 Rules").
Mr. Shiv Sagar Tiwari, learned counsel appearing on behalf of the
E Appellant in Civil Appeal arising out ofSLP (C) No. 12442 of2003, submitted
that allotment of valuable commercial land in favour of the Respondent was
made in favour of the private Respondent herein by the State in utter violation
of the 1973 Act and the 1975 Rules inasmuch as therefor no advertisement
was made and by reason thereof a ccmmercial area has been converted into
'~
F an industrial area. It was urged that the High Court committed a manifest
error in passing the impugned judgment insofar as it failed to take into
consideration that the State cannot distribute its largess without following the
provisions contained in the 1973 Act and the 1975 Rules which is violative
of Article 14 of the Constitution of India.
G
A commercial area, Mr. Tiwari submitted, would mean an area where
shops, restaurants, etc. are run and thus the Respondent cannot be entitled to
run an industry. It was pointed out that the State directed allotment of the
said land without fixing the quantum of the cost of the land, the market value
whereof was about Rs.2.50 crores reckoned at the rate of Rs.500/- per sq. ft
H
Mr. Prakash Shrivastava, learned counsel appearing on behalf of the
,,
....
K.K. BHALLA v. STATE OF M.P. [SINHA . .I.]
351
Appellant in Civil Appeal arising out of SLP (C) 22582 of 2004, submitted A
that the High Court committed an error in passing the impugned judgment
insofar as it having held that the land in question would come within the
purview of Rule 3 of the 1975 Rules proceeded to hold that Rules 19 and 20
thereof shall apply which are applicable only in relation to the land belonging
to the authority and not to the State. It was further submitted that even in B
terms of the 1975 Rules only land measuring upto 5000 sq. feet could have
been allotted in favour of YMCA but the land allotted in its favour measures
8000 sq. feet.
Mr. Yivek K. Tankha, learned senior counsel appearing on behalf of
the Respondent in Civil Appeal arising out ofSLP (C) 12442 of2003, on the C
other hand, argued that the Appellant herein did not approach the court with
clean hands inasmuch as he had not questioned similar allotments made in
favour of other persons similarly situated. It was submitted that the State
passed the impugned orders at the instance of the JOA itself in view of the
fact that the lands in question being nazul lands, the approval and/ or
pennission of the State therefor was mandatorily required to be obtained.
D
Mr. Tankha further drew our attention to the events which took place
subsequent to the passing of the impugned order and would submit that
keeping in view of the fact that the Respondent had placed orders for printing
machinery worth rupees two crores, this is a fit case in which the court
should not exercise its discretionary jurisdiction in condoning delay of 156 E
days in filing the special leave petition and/ or exercise its jurisdiction under
Article 136 of the Constitution. The allotment of land in any event twing not
been found to be arbitrary or ma/a fide, there is no reason as to why this
Court should interfere with the judgment of the High Court.
Mr. Anoop G. Chaudari. learned senior counsel appearing on behalf of
YMCA, submitted that the Respondent being a charitable organization, it was
entitled for allotment of a piece of land having regard to the fact that other
communities similarly situated had been allotted lands. Our attention was
drawn to the fact that an application in this behalf was filed by YMCA before
F
the JOA whereupon the Chairman referred the matter to the State of Madhya G
Pradesh for passing necessary order. It is true that no recommendation was
made by the JOA for allotment of land but the said application was not
rejected either. Stand of the JDA in this behalf was that it was for the State
Government to make allotment. It was in the aforementioned perspective the
Government of Madhya Pradesh through its Under Secretary by a letter dated H
21.8.1996 communicated as under:
352
A
SUPREME COURT REPORTS
[2006) I S.C.R.
"Out of the authorities land located in the civic centre, which has
been sought by Y.M.C.A. Institution. out of that 8000 sq. feet area
should be allotted to the General Secretary Y .M.C.A. Institution.
2. According to the guidelines contained in the Revenue Department
Circular No. M-6-173/96/Seven/Sa/2-B/Nazul, dated 31.5.96, the said
B
institution should be given the land at a discount of 50% on the
market rate and 50% discount shou Id also be given in the lease rent.
The development authority should also work out the requisite terms
and conditions."
It was urged that as in the instant case, the procedures prescribed under
C the Rules had been followed and the discretion vested in the State has been
properly exercised, this Court should not exercise its discretionary jurisdiction.
It was urged that the JDA was bound to ask for the sanction for such allotment
in terms of Rule 3 of the 1975 Rules and as in the instant case a direction
has been issued, the same should be considered as sanctioning the proposal
D of the JDA.
E
As regard the submission that not more than 5000 sq. feet of land could
be allotted, it was urged that no such plea was taken before the High Court.
It was further pointed out that part of the land is to be utilized for commercial
purposes.
Ms. Vibha Datta Makhija, learned counsel appearing on behalf of the
State also supported the impugned judgment and submitted that all actions
were taken in terms of the Rules. Legality or otherwise of the allotment of
\ .
land in favour of the private respondents herein according to the learned
\, /
counsel must be judged in the context of the law prevailing in this behalf.
F
Before adverting to the rival contentions as noticed hereinbefore, we
may notice relevant provisions of the statutes.
The 1960 Act was enacted to consolidate and amend the law relating
to the establishment of Improvement Trusts for the purpose of making and
G executing Town Improvement Schemes in certain towns of Madhya Pradesh.
Jabalpur Improvement Trust was created under the said Act. Improvement
Scheme framed by the said Trust in terms of the provisions the statute was
required to be implemented. The State has the requisite power to sanction
schemes in terms of Section 51 of the 1960 Act. Section 52 postulates that
H upon such sanction it shall announce, except in the case of a deferred street
....
•
K.K. BHALLA v. STATE OF M.P. [SINHA. J.]
353
scheme, development scheme or town expansion scheme that the Trust shall A
forthwith proceed to execute the same by notification; and may order that
any street, square, park, open space or other land, or any other part thereof,
which is the property of the Government and managed by the Central
Government or the State Government shall, subject to such conditions as it
may impose, vest in the Trust for the purpose of the scheme. Publication of
such a notification was to be treated as a conclusive evidence that the scheme B
has duly been framed and sanctioned.
Chapter V of the 1960 Act provided for acquisition and disposal of
land. The Trust in terms of Section 67 was entitled to acquire, by purchase,
lease or exchange any land within the area comprised in a sanctioned scheme C
from any person under an agreement which indisputably would include the
State. Section 68 provided for notice of acquisition of land.
The 1960 Act, however, was repealed and replaced by the 1973 Act in
terms whereof JOA was created.
The 1973 Act was enacted to make prov1s1ons for planning and
development and use of land; to make better provision for the preparation of
development plans and zoning plans with a view to ensuring that town planning
schemes are made in a proper manner and their execution is made effective;
to constitute Town and Country Planning Authority for proper implementation
D
of town and country development plan; to provide for the development and E
administration of special areas through Special Area Development auth...,rity;
to make provision for the compulsory acquisition of land required for the
purposes connected therewith.
"Commercial use" has been defined in Section 2(e) to mean "the use
of any land or building or part thereof for the purpose of carrying on any
trade, business or profession, or sale or exchange of goods of any type
whatsoever and includes running of with a view to making profit, hospitals,
nursing homes, infirmaries, educational institutions, hotels, restaurants and
and boarding houses (not being attached to any educational institution) sarais,
F
and also include the use of any land or buildings for storage of goods or .as G
an office, whether attached to an industry or otherwise."
"Development plan" has been defined in Section 2(g) to include zoning
plan and "'existing land use map" has been defined in Section 2(i) to mean
a map indicating the use to which lands in any specified area or put at the
time of preparing the map and includes the register prepared, with the map H
354
SUPREME COURT REPORTS
[2006) I S.C.R.
A giving details of land-use.
Chapter IV of the 1973 Act provides for planning areas and development
plans. The procedures laid down for finalizing a development plan has been
laid down therein. Any person aggrieved by any order granting permission
on condition or refusing the same is entitled to prefer an appeal thereagainst
B before the appellate authority in terms of Section 30 thereof. The revisional
power in this behalf is vested in the State.
Section 49 of the 1973 Act provides for town development sche~s.
Registration on land use and land development is provided for under Section
C 53 thereof. Section 58 provides for disposal of land in the following terms:
D
E
F
G
"58. Disposal of land, buildings and other development worksSubject to such rules as may be made the State Government in this
behalf, the Town and Country Development Authority shall by
regulation, determine the procedure for the disposal of developed
lands, houses, buildings and other structures."
Section 72 of the 1973 Act envisages the State Government's power of
supervision and control over the acts and proceedings of the officers appointed
under Section 3 and the authorities constituted under the 1973 Act. Section
73 empowers the State Government to give directions in the following terms:
"73. Power of Stale Government to give directions.-(1) In the
discharge of their duties the officers appointed under Section 3 and
the authorities constituted under this Act shall be bound by such
directions on matters of policy as may be given to them by the State
Government.
(2) If any dispute arises between the State Government and any
authority as to whether a question is or is not a question of policy,
the decision of the State Government shall be final."
Section 85 of the 1973 Act provides for rule making power.
The State of Madhya Pradesh in exercise of its power conferred upon
it under Sections 58 and 85 of the 1973 Act made rules known as "Madhya
Pradesh Nagar Tatha Gram Nivesh Vikasit Bhoomiyo, Griho, Bhavanotatha
Anya Sanrachnaon Ka Vyayan Niyam, 1975".
H
Rules 3, 4, 5. 19 and 20 of the 1975 Rules which are material for our
•
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K.K. BHALLA v. STATE OF M.P. [SINHA. J.]
355
purpose read as under:
"3. No Government land vested in or managed by the Authority shall
be transferred except with the general or special sanction of the State
Government given in that behalf.
A
4. All other land (hereinafter called the "Autl:ority land") shall be B
transferred in accordance with the following rules.
5. Transfer of the Authority land shall be as under:
(a) By direct negotiation with the party; or
(b) By public auction; or
( c) By inviting tenders; or
( d) Under concessional terms.
c
19. The Authority may with the previous approval of the State
Government lease out on concessional terms any authority land to D
any public institution or body registered under any law for the time
being in force.
20. Ordinarily, no lease on concessional terms shall be allowed for
the purposes of other than charitable purposes such as for hospital E
educational institutions and orphanages."
The State in terms of the provisions of the 1973 Act and the 1975 Rules
is a statutory authority. Its jurisdiction to oversee functions of the authorities
of the Board as also power to issue directions are circumscribed by the
provisions contained in Sections 72 and 73 of the 1973 Act.
Concededly, the lands in question was either acquired lands or nazul
lands. It also stands admitted that in terms of the provisions of Sub-section
F
(2) of Section 71 of the 1960 Act even the nazul lands stand admittedly
vested in the authority and having regard to the provisions contained in
Section 87( I )(c)(iii) all assets and liability of the Town Improvement Trust G
shall belong to and be deemed to be the assets and liabilities of the Town and
Country Development Authority established in place of such Town
Improvement Trust.
The power of disposal of lands, buildings and other developmental
works indisputably vests in the Town and Country Development Authority H
356
SCPREME COURT REPORTS
[2006 I I S.C.R.
A i.e. the JOA. We have, however, not been informed as to whether any
regulation has been framed by the authority for regulating the procedures for
disposal of developed lands, houses, buildings and other structures. However,
the lands in question is a developed land. The right to dispose of such lands,
therefore, vests in the JOA. Such right being subject to the rules made by the
B State, we may closely examine the provisions thereof.
Rule 3 of the 1975 Rules puts an embargo in the power of the JOA to
transfer government land vested in or managed by it except with the general
or special sanction of the State Government given in that behalf. Rule 4
demonstrates that all other land acquired by the authority become transferable
C in accordance with the rules following. A distinction, thus, has been made
between a government land and the authority land. The rules following Rule
4 refer to the authority lands as contradistinguished from the government
land. Rule 5 again •:ategorically refers to the authority land in terms whereof
transfer on concessional terms is permissible. Rule 19 empowers the authority
to lease out on concessional terms any authority land to any public institution
· D or body registered under any law for the time being in force. Rule 20, however,
provides that ordinarily no lease of land on concessional terms shall be allowed
for the purposes other than charitable purposes such as for hospital, educational
institutions and orphanages.
The right to transfer land on concessional terms, thus, is subject to two
E limitations, viz., (i) approval of the State is required therefor; and (ii) no
lease on concessional terms shall be allowed for purposes other than charitable
purposes such as hospital, educational institutions and orphanages; which
implies that in a given situation a lease may be granted on concessional terms
to any other institution but therefor sufficient and cogent reasons must be
F assigned.
The JOA, therefore, only had requisite authority to initiate the
proceedings for grant of lease of land on concessional terms wherefor only
the previous approval of the State was required to be taken. The State, except
grant of previous approval to the proposal of the JDA and ultimate grant of
G lease of its land on concessional terms, has no other role to play. Disposal
of the authority land is. thus, within the domain of the JOA, subject only to
the previous approval of the State Government.
H
The State and the J.D.A. being creatures of the statute were bound to
act within the four-corners thereof. Procedures for disposal of land having
been laid down in the rules. power in that behalf was required to be exercised
-
-
J
.J
K.K. BHALLA v. STATE OF M.P. (SINHA. J.]
357
strictly in confonnity therewith and de'hors the same.
The State has fonnulated a purported policy decision on or about
10.8.1995. The said policy decision is in relation to the land belonging to the
State situated in the entire State of Madhya Pradesh. It has been issued by the
Revenue Department and not by the Town and Country Planning Department.
A
The said purported policy decision is not a policy decision in terms of the B
1973 Act or the rules framed thereunder. State, thus, could not even issue any
direction to J.D.A.
The Respondent filed an application for allotment of land as far back
as in 1986. Further applications are said to have been filed on 4.3.1989 and C
7.7.1992. The Respondent filed an application on 7.7.1994 before the Nazul
Officer for allotment of land relying on or on the basis of the purported
policy decision adopted by the State that the land should be allotted to the
said industry. It is not in dispute that the land within Scheme No. 18 was
reserved for auditorium and cinema hall (for public and semi public purposes)
at city level. Purported policy by the State was adopted on I 0.8.1995 only. D
Pursuant to or in furtherance of the said policy decision, a decision was taken
to allot the land on 14.10.1995. It is only on 21st November, 1995 the State
allotted the land in question in favour of the private Respondent stating that
the land is a government land.
In para 5.18 of the writ petition, the Appellant averred:
E
"To the knowledge of the petitioner, the matter of allotment of land
to respondent No. 3 was never placed before the State Level Committee
constituted vide memo, dated 10.8.1995. There is no mention of the
same in the memo of allotment dated 21.11.95. On the contrary, the
said memo itself mentions that the matter of payment of premium and F
ground rent would be decided subsequently by the Committee. It is
evidently clear that the State Government by passing its own guidelines
and without referring the matter to the said State Level Committee
constituted vi de memo dated 18.10. 95 directed allotment of the land
in question to the respondent No. 3 surreptitiously without making it G
public to the detriment of other similarly situated press owners. Thus,
action of the respondents No. I and 2 in allotting the land to the
respondent No. 3 to the exclusion of others is absolutely arbitrary
illegal and discriminatory and the same is liable to be struck down."
In response to the said statements, the State in its counter affidavit H
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SUPREME COURT REPORTS
(2006) I S.C.R.
A averred:
"The matter was referred to State Level Committee but the State
Level Committee did not entertain the matter as the land in question
was not a Na::.u/ land and ultimately a decision was taken by the
Government. There was no need or occasion to publish public. One
B
who needed land could always approach the State Government and
the State Government could decide the application on merits. Ne
publicity was needed as suggested."
Thus, there appears to be some contradiction in the said statement. If
the land in question was not Nazul land, question of exercising any jurisdiction
C thereover by the State in any manner whatsoever, does not arise.
It is also accepted that the land was allotted for the purpose of
establishing a printing press and publication of newspaper. It is also curious
to note that despite allotment, the quantum of premium and annual rent was
D not fixed.
E
Establishment of a printing press would be an 'industry'. Even otherwise
the said position stands accepted as would appear from the letter dated 4.1.1996
of the Chairman of the JOA addressed to the Deputy Secretary, Chief Minister
Secretariat which is in the following terms:
" ... The then Chairman (Divisional Commissioner) vide his letter No.
1173 dated 28.11.95 addressed to the Govt. in last para has mentioned
that the plot in question land use of which is public/ semi public as
approved and adopted by Jabalpur Development Scheme, on which
there is a provision for construction of an auditorium for the artist of
F
the city level whereas the use of the press comes under induslrial use
and this issue has been raised and under those circumstances the
permission for change of land use and handing over the advance
possession to Dainik Bhaskar Press.
G
H
On 13.12.95 you had a talk with reference to said letter with then
Chairman (Divisional Commissioner).