# PADMA v. HIRALAL MOTILAL DESARDA & ORS

- **Citation:** [2002] Supp. 2 S.C.R. 179
- **Court:** Supreme Court of India
- **Decided:** 2002-09-09
- **Bench:** G.B. Pattanaik, R.C. Lahoti
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/padma-v-hiralal-motilal-desarda-ors-18518
- **Pages:** 30

## Headnote

B
Urban Development-Housing-Allotment of land by bulk sale by
CIDCO-Petition challenging allotment-Treated as Public Interest
Litigation-Irregularities in allotment found and allotment held to be null and C
void by High Court-In appeal plea of want of necessary pleadings and
denial of opportunity of defending by non-petitioners raised-Plea rejected
and finding of High Court upheld-However, relief modified.
Constitution of India, 1950, Articles 32, 226-Public Interest litigation--
Technicalities do not deter the Court in wielding its power to do justice, D
enforcing the law and balancing the equities.
Government of Maharashtra acquired land for City and Industrial
Development Corporation (CIDCO), a Government Company, the main
objective of which was to develop land for residential, commercial and
allied industrial activities on "no profit no loss" basis. CIDCO got approval E
of development plan by the Government. A patch of land had been shown
in the approved plan meant for future expansion. After development of
the approved land, CIDCO decided to dispose of the developable land by
butk·sale and consequently the land was allotted to respondent Nos. 5,6,9
and 15.
Respondent No. I filed writ petition before High Court chailenging
the bulk sale by CIDCO. High Court treated the petition as public interest
litigation and called for the records of CIDCO and framed issues, beyond
the pleadings in the writ petition. High Court found that respondent No.12
F
was Director of CIDCO at the relevant time and respondent Nos. 5, 6 and G
15 were alteregos of respondent No.12, and they were created during same
period; that allotments were made without approval of Board of Directors
of CIDCO and without assigning any reason for allotment; that allotment
made to respondent No.5 was without affording other rivals an opportunity
of participating in the bid and when the revised development plan was
179
H
180
SUPREME COURT REPORTS [2002] SUPP. 2 S.C.R.
A pending with the Government for approval; that the lands were allotted
for less than reserve price for no reason and without specific approval by
the Board or competent authority; that the letters of allotment did not
set out the nature of land user. Court held that the action of CIDCO in
the matter of disposal of land by bulk sale was against public interest and
B allotment of land was null and void, as the draft development plan had
not been approved by the State G~vernment as required under Section
I IS of Maharashtra Regional and Town Planning Act; that the
proclamations issued for disposal of land were illegal; that individual
allotments made in favour of respondent Nos. 5,8,9,10 and 15 were also
illegal and the administration was directed to take immediate possession
C of the respective lots including the structure and buildings standing
thereon. Respondent No. 6 , allotment in whose favour was subsequently
cancelled by CIDCO, filed writ petition which was dismissed by High
Court.
In appeal to this Court appellant contended that High Court
D committed error in entertaining individual grievance of respondent No.I,
who himself happened to be a builder on purchase of land, as a Public
Interest Litigation; that the legality of allotment of land could not have
been examined by High court in the absence of any pleadings in that
respect; and that in respect of several plots of land constructions having
E already been made and the appropriate authority of the Government
having approved the development as well as proposal of bulk disposal of
plots it is fully inequitable to cancel the allotments.
Respondent No. I contended that finding of High Court tantamount
to finding of fraud committed by CIDCO in the matter of allotment of
F land and therefore fraud vitiates every action of the authority, and hence
it wasjust and proper for the High court to set aside the allotment made.
Dismissing the appeals, the Court
HELD: I.I. The appellants cannot raise any grievance on the ground
G of want of necessary plead

## Text

_Characters 0–39,873 of 78,790. This is a partial read: ask again with offset=39873 for what follows._

PADMA
A
V.
HIRALAL MOTILAL DESARDA & ORS.
SEPTEMBER 9, 2002.
[G.B. PATTANAIK AND R.C. LAHOTI, JJ.]
B
Urban Development-Housing-Allotment of land by bulk sale by
CIDCO-Petition challenging allotment-Treated as Public Interest
Litigation-Irregularities in allotment found and allotment held to be null and C
void by High Court-In appeal plea of want of necessary pleadings and
denial of opportunity of defending by non-petitioners raised-Plea rejected
and finding of High Court upheld-However, relief modified.
Constitution of India, 1950, Articles 32, 226-Public Interest litigation--
Technicalities do not deter the Court in wielding its power to do justice, D
enforcing the law and balancing the equities.
Government of Maharashtra acquired land for City and Industrial
Development Corporation (CIDCO), a Government Company, the main
objective of which was to develop land for residential, commercial and
allied industrial activities on "no profit no loss" basis. CIDCO got approval E
of development plan by the Government. A patch of land had been shown
in the approved plan meant for future expansion. After development of
the approved land, CIDCO decided to dispose of the developable land by
butk·sale and consequently the land was allotted to respondent Nos. 5,6,9
and 15.
Respondent No. I filed writ petition before High Court chailenging
the bulk sale by CIDCO. High Court treated the petition as public interest
litigation and called for the records of CIDCO and framed issues, beyond
the pleadings in the writ petition. High Court found that respondent No.12
F
was Director of CIDCO at the relevant time and respondent Nos. 5, 6 and G
15 were alteregos of respondent No.12, and they were created during same
period; that allotments were made without approval of Board of Directors
of CIDCO and without assigning any reason for allotment; that allotment
made to respondent No.5 was without affording other rivals an opportunity
of participating in the bid and when the revised development plan was
179
H
180
SUPREME COURT REPORTS [2002] SUPP. 2 S.C.R.
A pending with the Government for approval; that the lands were allotted
for less than reserve price for no reason and without specific approval by
the Board or competent authority; that the letters of allotment did not
set out the nature of land user. Court held that the action of CIDCO in
the matter of disposal of land by bulk sale was against public interest and
B allotment of land was null and void, as the draft development plan had
not been approved by the State G~vernment as required under Section
I IS of Maharashtra Regional and Town Planning Act; that the
proclamations issued for disposal of land were illegal; that individual
allotments made in favour of respondent Nos. 5,8,9,10 and 15 were also
illegal and the administration was directed to take immediate possession
C of the respective lots including the structure and buildings standing
thereon. Respondent No. 6 , allotment in whose favour was subsequently
cancelled by CIDCO, filed writ petition which was dismissed by High
Court.
In appeal to this Court appellant contended that High Court
D committed error in entertaining individual grievance of respondent No.I,
who himself happened to be a builder on purchase of land, as a Public
Interest Litigation; that the legality of allotment of land could not have
been examined by High court in the absence of any pleadings in that
respect; and that in respect of several plots of land constructions having
E already been made and the appropriate authority of the Government
having approved the development as well as proposal of bulk disposal of
plots it is fully inequitable to cancel the allotments.
Respondent No. I contended that finding of High Court tantamount
to finding of fraud committed by CIDCO in the matter of allotment of
F land and therefore fraud vitiates every action of the authority, and hence
it wasjust and proper for the High court to set aside the allotment made.
Dismissing the appeals, the Court
HELD: I.I. The appellants cannot raise any grievance on the ground
G of want of necessary pleadings and denial of necessary opportunity of
defending themselves at the hearing in High Court. I 192-F; 193-BJ
1.2. The High Court had, by having framed the issues, put all the
parties before it on notice that it proposed to enter into issues wider than
what may have been raised in the writ petition filed before it. The nonH petitioners in the High Court, including the appellants, were put on notice
PADMA v. HIRALAL MOTJLAL DESARDA
181
of the issues on which the High Court proposed to dwell upon and they A
were allowed full opportunities of defending themselves by bringing in such
pleadings and documents as they proposed to do in their defence. The High
Court called for the record of CIDCO and subjected the same to scrutiny
under its magnifying glass of judicial review. The non-petitioners in the
High Court were well aware of CIDCO record of proceedings and the
findings of the High Court are based on the facts discernible from the B
records and the factual inferences necessarily and inevitably flowing
therefrom. 1192-F-H; 193-AI
1.3. Litigation before High Court assumed the character of public
interest litigation of wider scope, not necessarily confined to grievance C
raised by the writ petitioner and the High Court was intervening to bring
under its scrutiny, under the well settled parameters of public interest,
the proceedings of CIDCO relating to attempted disposal of developable
liind. While hearing a public interest litigation the Constitutional Court
acts as the sentinel on the qui vive discharging its obligation as custodian
of the constitutional morals, ethics and code of conduct. Ttie Court is D
obliged to see while scrutinizing the conduct and activities of a public body
constituted with the avowed object of serving the society to see that its
activities bear no colour except being transparent, are guided with the
object of public good and are within the four corners of law governing
the same. The holder of every public office hold a trust for public good E
and, therefore, his actions should all be above board. 1191-G, H; 192-A, Bl
1.4. In public interest litigation jurisdiction the Constitutional Court
is mobilized and acts for redressal of public injury, enforcement of public
duty, protection of social rights and upholding constitutional and
democratic values. Technicalities do not deter the Court in wielding its F
power to do justice, enforcing the law and balancing the equities.
1193-A, BJ
1.5. It cannot be said that High Court should not have entertained
the writ petition filed by respondent No. I who was a business competitor
of respondent Nos.5,6,9 and 15. Firstly, because respondent No. I has not G
figured anywhere in or around the impugned transactions of sale. Merely
because at sometime in the past respondent No. I had himself secured some
allotment of land from CIDCO that would not mean that he was a business
competitor so far as the impugned transactions are concerned. Secondly,
because High Court has found respondent Nos.5,6 and 15 having been born
just around the year 1998-99 and, therefore, the question of their being H
182
SUPREME COURT REPORTS [2002] SUPP. 2 S.C.R.
·A in existence at that point of time ancl hence in rivalry when respondent
No.I had secured some allotment of land in the past does not arise. The
proceedings in the High Court show only the ball of judicial scrutiny
having set rolling by respondent No. I. Soon the High Court found the case
fit for exercising its own public interest jurisdiction, and therefore, the
B High Court framed its own issues which were not necessarily confined to
the pleas raised in the writ petition filed by respondent No. I. Therefore,
it cannot be held that the interest served by the proceedings in the High
Court has been anything other than pro bona publico. 1204-D-H I
2. !. The very sale of bulk land by an institution like CIDCO is an
C anathema to its objective and purpose of its establishment. By no stretch
of imagination it can be contemplated that it was or could have· been
intended either at the time of acquisition or at the time of sanction of
development plans by the State Government that at some point of time in
future the developable land would be available to be disposed of by bulk
sale and that too in favour of professional builders. That is why a condition
D was imposed that the developable land shall be available for being utilized
in accordance with the plan to be sanctioned by the State Government at
a later point of time. 1201-B; 201-E-FI
2.2. It is not disputed that CIDCO is supposec! to carry out its
activities on 'no profit no loss' basis and that is the basis on which CIDCO
E has been acting until it decided to part with the chunk of developable land
by bulk sale which proposal was obviously in departure from the policy
of serving on 'no profit no loss' basis such people as were craving for a
roof over their heads. In the present case, if only the proposal would have
been placed before the Board of CIDCO in all probability it would have
F been discarded. Good number of officials, through whose hands the
proposal passed while traveling up, were not agreeable to and had their
own reservations on I.he proposal of such bulk sale. What prevailed with
one or two of those placed at the higher rung of bureaucratic ladder in
permitting such bulk sale in hot haste defies explanation for the simple
reason that no reasons have been assigned in favour of endorsing the
G proposal for bulk land sale. It cannot be accepted that there was no
demand of land. Even if the development plan for the developable land
was not approved by the State Government there is nothing which had
prevented CIDCO from carving out small middle level and larger plots
which those who can afford. This finds support from the overwhelming
H demand of land which CIDCO had found out of proportion as compared
PADMA v. HIRALAL MOTILAL DESARDA
I 83
to the availability of land with it.1The decision for bulk land sale cannot A·.
be said to have been taken in public interest. 1202-D-H; 203-A, Bl
2.3. The land acquired and entrusted to CIDCO cannot just be
permitted to be parted with, guided by the sole consideration of moneymaking. CIDCO is not a commercial concern whose performance is to be
assessed by the amount it earns. Its performance would be better assessed B
by finding out the number of needy persons who have been able to secure
shelter through CIDCO and by the beauty of township and quality of life
for people achieved by CIDCO through its planned development schemes.
So long as such objectives are fulfilled CIDCO's operation on 'No-ProfitNo Loss' basis cannot be found fault with. There should have been no C
hurry on the part ofCIDCO in disposing of the balance land and that too
guided by the sole consideration of earning more money. Even that object
the CIDCO has not been able to achieve for at the end it has parted with
land at a price less than the reserved price. Even if a sale of left-over land
was a felt-necessity it should have satisfied at least two conditions: (i) a
well-considered decision at the highest level; and (ii) a sale by public D
auction or by tenders after giving a more wide publicity than what was
done so as to attract a iarger number of bidders. 1203-D-Gl
2.4. On principle and in substance, the order of the High Court is
maintained. The impugned sales of land in favour of respondent Nos. 5,6
9 and 15 are vitiated and hence not binding on CIDCO. 1206-El
E
I ). <11.1: ' f I '
2.5. High Court has pierced the veil of respondent Nos. 5, 6 :rnd 15.
There is every reason to draw lildeduction·.that these legal entities of
different colour and shade were brought into lieing around the crucial
period of time and almost just following1the1point of time When the idea
of disposal of the developabldand through blilk'sale'had dawned upon
the CIDCO wherein respondent No. 12 was a Director. :fhese 'three entities,
though each appearing in a legal cloak outwardly, were in fact family
affair of respondent No.12. 1197-A; 194-B, q
F
2.6. Record filed by respondent No. 9 does not show that it had G
anyone inside CIDCO exerting his or her influence from within to oblige
it as it has been in the case of PWI2 and his cloaked duplicates. Therefore,
in spite of holding of sale in favour of respondent No.9 vitiated, in view of
subsequent events, the situation having become irreversible on account of
construction of vast magnitude having come up and third party interests
having been created, respondent No.9 shall remain liable to pay the price H
184
SUPREME COURT REPORTS [2002] SUPP. 2 S.C.R.
A of the land allotted to it, the reserve price, within a time to be appointed
by CIDCO. (205-C, D; 206-F(
2.7. From the pleadings and documents filed by respondent No. 15,
no idea can be formulated about the nature and extent of construction, if
11ny, done and the time by which it was done. From the judgment of the
B High Court only a passing reference is found wherefrom it can be gathered
that 'some' building has come into existence over the land allotted to it.
There is not a slightest indication of its having created any third party
interests. The land sold to it shall be inspected, surveyed and demarcated
under the supervision ofa highly placed and responsible official ofCIDCO
C to be nominated by its Board. Such of the land on which substantial
construction has come up rendering the situation irreversible shall be
separated alongwith some more area of contiguous land so as to make it
user practical. The total area of such land shall be calculated and in that
regard the buyer shall pay to CIDCO the reserve price subject to
adjustment for the amount already paid. Such other land on which no
D construction has come up or no substantial construction has been made
shall be demarcated and revert back to CIDCO. (205-H; 207-A, BJ
2.8 The pleadings and documents placed on record by respondent
No. 5, do not project that it has made any construction, much less created
any third party interest, so as to make the situation irreversible. It is,
E therefore, proper to sustain the order of the High Court directing
resumption of land by CIDCO. (206-CI
F
(The Court directed that CIDCO and all other law enforcing
agencies should see that the land user complies with the
requirements of development plan and local laws and no departure
therefrom should be permitted, and that the land which reverts
to CIDCO in future be utilized strictly in accordance with the
development plan sanctioned by State Government and after
meeting with the approval of the Board of CIDCO.) (207-C, DJ
G
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5698 of
H
2002.
From the Judgment and Order dated I 0.11.2000 of the Bombay
High Court in W.P. No. 238 of 1999.
WITH
PADMA v. HIRALAL MOTILAL DESARDA [PATTANAIK, J.]
185
C.C. Nos. 5699, 5700, 5701, 5702, 5704 of 2002 and SLPL (C)
A
Altaf Ahmad, Additional Soliciter General, V.A. Mohta, Yashank P.
Adharu, P.N. Mishra, Rakesh Dwivedi, R.R. Mantri, Ashok K. Gupta,
Farrukh Rasheed, S.M. Jadhav, Serva Mitter, A.S. Bahasme, S.K. Visen,
M.K. Mishra, T. Raja, Uday U. Lalit,, S.V. Kharde, Naresh Kumar, Colin
Gonsalvis, Ms. Aparna Bhat, Ms. Tashi, S.V. Deshpande and E.P. Sawant B
for the appearing parties.
The Judgment of the Court was delivered by
PATTANAIK, J. Leave granted in SLP(C) Nos. 19687, 20512, 20666,
20753 of 2000 and 4606 and 21825 of 2001.
C
In these appeals by grant of special leave the judgment of High Court
of Bombay, Aurangabad Bench in Writ Petition No. 2338 of 1999 is under
challenge. A Public Interest Litigation was filed in the High Court challenging
the procedure adopted by the City and Industrial Development Corporation D
(hereinafter referred to as CJDCO) for disposal of the land by bulk sale.
' CIDCO is a company registered under the Companies Act and is a government
company under section 617 of the Companies Act. The Government of
Maharashtra incorporated the aforesaid company with several objectives and
the main objectives being :
E
(a) To develop land for residential, commercial and allied industrial
activities and to provide the required physical infrastructure, such as
roads, drainage, water supply, sewerage, street lights and landscaping
etc.
(b) To build as many houses and community centers, shopping centers, F
parks, play grounds, bus stations, etc. to meet the day to day needs
of the population, as well as for a fast take up of new growth areas
and.also to make available and develop the plots at affordable prices,
so as to construct residential dwellings for self occupation.
(c) To promote growth of commercial, wholesale market activities, G
warehousing, transport, office and other activities in order to evolve
expeditiously a sound economic base for self sustained growth and
achieve, at the same time, a process of relieving congestion in the
cities like Bombay as well as the fast developing cities in other parts
of Maharashtra and (d) While doing so, to maintain ecological balance
and ensure that environmental degradation is not allowed.
H
186
SUPREME COURT REPORTS [2002) SUPP. 2 S.C.R ..
A
The CIDCO was declared as special planning authority for Aurangabad
notified area under Sub-section 3(A) of Section 113 of the Maharashtra
Regional and Town Planning Act, 1966 (hereinafter referred to as the Act)
for residential, commercial and industrial purposes. The state of Mahrashtra
acquired huge land for CIDCO in villages Mukundwadi, Garkheda, 1-larsul,
B 1-latesingpura, Jaswantsingpura, Bayajipura, Jadhavwadi, Murtizapur,
Mastanpur etc. which ar.e all located in the outskirts of Aurangabad Municipal
limits.
The Government of Maharashtra approved the development plan
submitted by CIDCO by its notification dated 3.7.1973. Under the approved
C plan about 900 Hectares of land was to be utilized for residential purposes,
commercial, education community facilities, medical services etc. and a patch
of land had been shown in the approved plan meant for future expansion, but
the purposes for such use had not been indicated.
Between 1975-76 and 1999-2000, CIDCO constructed tenements within
D notified area popularly known as New Aurangabad and 120 Housing Societies
also came into existence. Within these societies 39 societies were allotted
land OI) which the societies themselves have constructed residential tenements.
It transpires that 37.74% of land has been used for residential purposes,
4.90% for commercial purposes, 3.27% for educational purposes and 4.60%
E for industrial purposes. That apart land has also been utilized for providing
social services and for utilities as well as for road and pathways and Airport
and part of the land has been kept as open and vacant land.
CIDCO used to allot plots to citizens and society for construction of
residential dwelling units and it was also building multi storey building
F consisting of several apartments and used to sell them. CIDCO used to develop
commercial and shopping centres. In 1998-99 CIDCO started negotiating
with the Municipal Corporation of Aurangabad for taking over land in New
Aurangabad area. Proclamations were issued in the newspapers inviting tenders
for disposal of bulk land from different Survey Numbers, more particularly
from Survey Nos. 23 and 24 of Garkheda Village in Sector "B". The total
G land in these two Survey Numbers admeasured 19.53 Hectares. The land
owners were given 2.59 Hectares by negotiations and balance 16.94 Hectares
became the property of CIDCO, which was sought to be disposed of by bulk
sale. It is this proposal of bulk sale by CIDCO, which was assailed by filing
a writ petition purported to be one in public interest, essentially challenging
H the procedure adopted for disposal of the land. After filing of the writ petition
PAD MA v. HIRALAL MOTi LAL DESARDA (PA TT ANAIK. J.]
187
in May, 1999, the High Court passed an interim order in July, 1999, directing A
the Cl DCO. not to proceed further with a·cceptance of the tenders in respect
of the bulk sale. After the initial application that was filed, several other
applications were filed, challenging the alleged disposal of land made by
CIDCO and ultimately the High Cout1 by the impugned Judgment, came to
the conclusion that the action of CIDCO in the matter of disposal of land by B
bulk plots is against the public interest and the so-called allotment of land in ·
Sectors N-2 and N-4, consisting of Survey Numbers 23, 24 and 70 is null and
void, as the draft development plan has not been approved by the State
Government, as required under Section 115 of the Maharashtra Regional and
Town Planning Act. Accordingly, those allotments were cancelled. The High
Court also held that the proclamations issued for disposal of land are illegal C
and would stand cancelled. Individual allotments made in favour of respondent
Nos. 5, 8, 9, 10 and 15 also were annulled and the Administrator was directed
to; take immediate possession of the respective lots, including the structure
and buildings standing thereon:It·was further ordered that as and when the
Governmeni of Maharashtra approves the Draft Development Plan, then the
land earmatked for residential purposes could be disposed 'of by CIDCO by D
°inviting• public tenders and by· drawing. lots. There were also certain other
directior.s· in 'the impugned 'judgment.·
,A
1
. ,\ /'l.'
'
H
ti ,,Before the High Court, it was stated by the CIDCO and other allottees
t~at the w~it petitjon filed by one Hiralal Motilal Desarda, purported to be E
o~e in,public _interest, rt<ally does not espouse any public interest as the lands
-ha~~.been allotted to different Housing Societies, many of whom have already
,constructed several flats for the members of the society and any order annulling
those allotment~ .would be against the public interest. It was also averred
before ,the High Court that the said writ petitioner himself has taken several
plots ,for, bus.iness purposes and the present writ petition has been filed as a F
business ,rival and not in public interest. The High Court however was not
persuaded to accept this part of the stand taken by different allottees, though
factually it cannot be disputed that the writ petitioner before the High Court
and his family members had several plots of land on which building activities
had been carried on.
G
Mr. V.A. Mohta, learned senior counsel appearing for the petitioner in
S.L.P. No. 19687 of 2000, learned Additional Solicitor General appearing in
some of these SLPs and a host of other counsel submitted, that the High
Court committed error in entertaining an individual grievance who himself
happen to be a builder on purchase of land as a Public Interest Litigation and H
188
SUPREME COURT REPORTS [2002] SUPP. 2 S.C.R.
A an nu lied the allotments inade for the purpose of construction of houses which
does not subserve any public interest at all. It was further urged th~t neither
Section 115 of the MRTP Act nor any regulations framed thereunder restricts
the right or puts any embargo on the right of the CIDCO to dispose of land
in accordance with the Regulation framed by it. and that being the position
the High Court committed error in setting aside the allotment made by
B CIDCO.lt was also contended that the Court exceeded its jurisdiction_ under
Article 226 in embarking upon an enquiry on several questions of facts by
scrutinizing several governmental files and in coming to the conclusion that
there have been gross irregularities in the matter of allotment of land.
According to the counsel for the Petitioners the disposal of bulk plots of land
C by Special Planning Authority, like CIDCO after development of the land in
question is for providing opportunity to the citizens to have their houses built
on the land and the action of ClDCO is required to be examined from that
stand point. It is urged that no personal interest of any authority of the
C!DCO having been found to have been augmented on account of the allotment
of bulk land the Court was not justified in exercising its discretionary
D jurisdiction and interfering with the allotment made. It is urged that C!DCO
being a Special Planning Authority constituted under Section 40 of the
Maharashtra Regional Town Planning Act is not required to be covered by
the provisions of the Act relating to preparation of Draft Development Plan
and the conclusion of the High Court on that score is thus vitiated. It is also
E contended that the Regulations in question having been framed by CIDCO in
exercise of power conferred under Section 159(l)(a) of the Maharashtra
Regional Town Planning Act, which is known as the New Town Disposal
Regulation, 1992, and the disposal of lands impugned in the Writ Petition
having been made in accordance with the said prescribed procedure under
the Regulation, the High Court should not have interfered with the same,
F particularly when there has been no allegation of corruption and nepotism in
the matter of allotment of land, much less any proof of the same. It is
vehemently urged that the question of distribution or sale of land for
establishment of a New Township in the context of an abnormal growth of
the city of Aurangabad, is essentially a matter of policy and whether the sale
G of bulk plots is more profitable or beneficial subserving public interest or not
is a matter of policy and such policy decisions would not have been interfered
with by the High Court in exercise of its power of judicial review under
Article 226 of the Constitution, when it has not been established how the
aforesaid policy was erroneous or it caused any injustice to the public interest.
According to the learned counsel the so-called approval required under Section
H 115 of the MRTP Act having been granted by the Government of Maharashtra,
PAD MA v. HIRALAL MOTILAL DESARDA (PA TT ANAIK, J.]
189
the Court ought not to have interfered with the allotment of land made. A
According to the counsel for the petitioner the legality of allotment of land
from survey Nos. 23 and 24 could not have been examined by the High
Court in the absence of any pleadings in that respect and, therefore the
impugned judgment cannot be sustained. It is further urged that the change
of user or development of land is permissible with the permission of the B
Planning Authority and once the Planning proposal is published in the gazette
there is no restriction on transfer of ownership. The learned counsel further
contended that under Section 31 of the Act the State Government is required
to approve the plan within one year and if this is not done within the said
period then the restrictions under Section 43 will not be attracted. The learned
counsel lastly urged that in respect of several plots of land constructions C
having already been made and the Appropriate Authority of the government
having approved the development as well as proposal of bulk disposal of
plots it is fully inequitable to cancel the allotments made and also the direction
of the High Court works out gross injustice.
The learned counsel appearing for respondent no. I, however, D
vehemently urged that the findings of the High Court tantamount to a finding
of fraud committed by CIDCO in the matter of allotment of land and therefore
fraud vitiates every action of the authority. It is urged that the Director of
CIDCO as well as the Chief Administrator have allotted plots to themselves
and their family members which on the face of it is illegal and such an E
allotment could not have sustained the scrutiny of any Court of law. According
to the learned counsel the price fixed for allotment was even lower than the
base price of Rs. 1,500 per sq. metre and this could not have been done
without the board's agreement which was required under the CIDCO
publication title "New Aurangabad Guidelines". The counsel urged that there
has been allotment of land at a price of Rs. 1,300 per sq. metre which was F
done without re-advertising or tendering. So far as procedural irregularities
are concerned, the counsel urged that the applications were entertained without
any formal application and even without any payment of earnest money and
allotments were made to the parties even who never had made any application
for the same. It was also vehemently urged that the very method of sale of G
bulk plot caused serious financial loss to the CIDCO and no court should
permit such sale at the cost of public exchequer. lt was also urged that the
proposal of CIDCO to the State Government for sale of bulk plots to the
builders was never notified and as such there has been an infraction of Section
115(2) and (3) of the Regional Town Planning Act. The counsel urged that
when the Cou11 on consideration has found serious financial and procedural H
190
SUPREME COURT REPORTS [2002) SUPP. 2 S.C.R.
A irregularities and the findings arrived at would lead to an irresistible conclusion
that fraud has been perpetrated in the matter of allotment, it was just and
proper for the High Court to set aside the allotment made, and therefore, this
Court should not interfere with the same in exercise of its power under
Article 136 of the Constitution.
B
The troubled part of story, with which we are concerned, has its genesis
in certain events seated around the year 1998-99. Two significant events
occurred in that period of time. Out of several acres of land acquired by
CJDCO for developing the township of New Aurangabad, 120 housing
societies had come into existence over 136 plots and some 39 societies were
C relocated in accordance with the developed scheme of CJDCO. What had
remained was 3.3% of land earmarked as 'developable land'-to be developed
in accordance with development scheme to be sanctioned by the State
Government which would obviously depend inter alia on the relevant factors
to be assigned weight in the light of the development which had taken place
till then and keeping in view the needs of the population already accommodated
D in vicinity and/or the township already emerged and yet aspiring for still
better quality of life and better fulfillment of its needs in future consistently
with the needs of modem living standards. CIDCO, which was till then
engaged in allotting plots to citizens or societies for construction ofresidential
dwellings and building up multi-storey buildings catering to small and medium
E sized apartment requirements of families and selling them was yet to pass on
and enter into the three facet of its developmental activities, i.e. developing
commercial and shopping centres so as to cater to the needs of the individuals
and families settled in the township. Left with 3.3% of developable land only
it dawned upon CIDCO that insofar as the notified area is concerned its
developmental activities were nearing their end and CIDCO would be better
F advised to hand over the township to Aurangabad Municipal Corporation to
be looked after in accordance with the municipal law governing it. Suddenly
CIDCO dropped the idea of developing the township further in accordance
with the development plan which was yet to be sanctioned by the State
Government and thought that it would be profitable to hold bulk sales of
G remaining land and earn a lot of money therefrom and thereby enrich itself.
We can understand an individual being overpowered by greed; however, here
what the High Court notices is greed of an institution-an institution, the·
primary object whereof is not solely to earn money but to serve the people
through activities in tune with the avowed objects with which it has been
found and as set out in the earlier part of this judgment. However, as the
H several findings arrived at by the High Court and noticed shortly hereinafter
PAD MA v. HIRALAL MOTILAL DESARDA [PA TT ANAIK, J.)
191
would show the greed was implanted into the in.stitution by builders who had A
an eye over the left-over developable land so as to grab the same by prevailing
over CIDCO and manipulate allotment to their own commercial advantage.
Lest we should digress and drift away, we revert back to notice yet another
event. In the year 1998, Section 80-IB of the Indian Income Tax Act, 1961
was amended by Parliament whereby payment of income tax was exempted
on income derived from the housing projects commenced and completed B
between I. I 0.1998 and 31.3 .200 I. The object of amendment was to give a
boost to house building activity in big cities. Another requirement of the
exemption was that the project claiming benefit of the exemption ought to be
on a piece of land with a minimum area of one acre and the residential units
shall not exceed 1500 sq. ft. A sense of hurry is writ large on the movements C
ofCIDCO displaying an anxiety to dispose of the land by bulk sale and earn
money before the proposal for handing over the township to Municipal
Corporation could materialize. Advertisements were inserted in the newspapers
inviting tenders for disposal of bulk land out of survey Nos. 23 and 24 of
Garkheda village in 'B' sector, i.e. the land situated on the south of Jalna
Road, wherein was included 19.53 hectares ofland forming part of the survey D
Nos. 23 and 24. Out of this area, 2.59 hectares area of land was parted with
in favo:ir of some land owners through negotiations. 16.94 hectares area of
land was still available.
At this point of time, the public interest litigation came to be filed on E
19.5.1999 knocking the doors of the High Court when it was closed for
summer vacation. The High Court felt that the issue raised in the petition
calls for its attention. Notices were issued to CIDCO and other respondents.
By an interim order proceedings for acceptance of the tenders and thereafter
were directed to remain stayed. The High Court soon realised that the issue
of public interest raised in the writ petition required the conduct of the case F
not to be left in the hands of the writ petitioner alone, and therefore, by its
order dated 7.12.1999 appointed an amicus curiae to assist the Court. However,
a little later it was brought to the notice of the High Court that the original
writ petitioner was not carrying on well with the amicus curiae and to avoid
the conflict the High Court chose to proceed with the hearing of the petition G
dispensing with the assistance of the amicus curiae. The fact remains that the
litigation had assumed the character of a public interest litigation of wider
scope, not necessarily confined to grievance raised by the writ petitioner and
the High Court was intervening to bring under its scrutiny, on the well settled
parameters of public interest, the proceedings of CIDCO relating to attempted
disposal of developable land. While hearing a public interest litigation the H
192
SUPREME COURT REPORTS [2002] SUPP. 2 S.C.R.
A constitutional court acts as the sentinel on the qui vive discharging its obligation
as custodian of the constitutional morals, ethics and code of conduct - well
defined by series of judicial pronouncements. The Court is obliged to see
while scrutinising the conduct and activities of a public body constituted with
the avowed object of serving the society to see that its activities bear no
B colour except being transparent, are guided with the object of public good
and are within the four corners of law governing the same. The holder of
every public office hold a trust for public good and therefore his actions
should all be above board. Whatever may have been the grievance raised in
the writ petition filed by the original writ petitioner, vide its order dated
28.4.2000 the High Court framed the following four questions laying down
C the scope of hearing before it:-
D
E
•(a) Whether CIDCO should be allowed to resort to bulk land sale as
a normal course of its activities?
(b) Whether such an action by C!DCO is permissible in the public
interest vis-a-vis its objectives?
(c)
Whether the bulk land sale transactions made in the recent past
and more particularly after the petitioner has· approached this
court have been dubious in nature and they have been made by
giving a go-bye to the Rules and Regulations as well as objectives
of CIDCO?
(d) Whether the plots have been allotted at a price much lower than
the base price and this has resulted in a substantial loss to C!DCO?
We have set out the above said part of the High Court proceedings to meet
plea raised by the appellants before us which complains of want of pleadings
F and denial of necessary oppo1tunity of defending themselves at the hearing
in the writ petition. The High Comt had, by having framed the abovesaid
questions, put all the parties before it on notice that it proposed to enter into
issues wider than what may have been raised in the writ petition filed before
ii. The non-petitioners in the High Court, including the appellants before us,
G were put on notice of the issues on which the High Court proposed to dwell
upon and they were allowed full opportunities of defending themselves by
bringing in such pleadings and documents as they proposed to do in their
defence. The High Court called for the record of CIDCO and subjected the
same to scrutiny under its magnifying glass of judicial review. The nonpetitioners in the High Comt were well aware ofCIDCO record of proceedings
H and the findings of the High Court are based on the facts discernible from the
PADMA v. HIRALALMOTILALDESARDA[PATTANAIK,J.]
193
records and the factual inferences necessarily and inevitably flowing therefrom. A
In public interest litigation jurisdiction the Constitutional Court is mobilized
and acts for redressal of public injury, enforcement of public duty, prntection
of social rights and upholding constitutional and democratic values.
Technicalities do not deter the Court in wielding its power to do justice,
enforcing the law and balancing the equities. We are unhesitatingly of the B
opinion that the appellants before us cannot raise any grievance on the ground
of want of necessary pleadings.
The private respondents joined before the High ·Court can be grouped
into three:
(a) Sethes Cooperative Housing Society, respondent No.7 and Judges C
Cooperative Housing Society, respondent No.8 - The allotments
to these two do not appear to have materialized and therefore as
to these respondents the High Court has not roade any direction.
In any case the controversy as regards these two is not the subject
matter of proceedings before us.
(b) Mrs. Padma representing Tapadia Construction Pvt. Ltd.,
respondent No.9, (hereafter referred to simply as 'Tapadia', for
short).
D
(c) Aurangabad Ajanta Bahu Udeshiya Seva Sanstha, CIDCO,
Aurangabad, respondent No.5, Suchita Housing Society, E
Aurangabad, respondent No.6 and Aurangabad Holiday Resort
Pvt. Ltd., respondent No. I 5.
The allotments to group 'b' and group 'c' above though made during the
same period oftime and suffering from vitiating factors of more or less equal
magnitude yet have some essential difference which· will have a bearing on F
constructing the ultimate relief to be given and therefore we have carved out
these groups. The High Court has also, during the course of its judgment, set
out the facts referable to these two groups with some margin of differentiation.
So far as the facts, and the findings flowing from the documents, are
concerned, for the purpose of this judgment, it would suffice if we extract G
and reproduce the gist thereof from the detailed and well cast judgment of the
High Court inasmuch as after affording full-dressed hearing to the learned
counsel for the parties we are satisfied that so far as the findings of fact are
concerned no fault can be found with the ones arrived at and recorded by the
High Court in its judgment. We proceed accordingly.
H
194
SUPREME COURT REPORTS [2002] SUPP. 2 S.C.R.
A
Shri Sambhaji Pawar, respondent No.12, has been a Director of CIDCO
between 1995 and 1999.