TaxTMI 
TaxTMI 
2010 (9) TMI 1092
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....relating to Yamuna Expressway Project, were dismissed by the High Court. In the Writ Petitions, directions were sought, firstly not to give effect to the notifications issued and further not to dispossess the landholders/petitioners after demolishing their constructions on the lands which were proposed to be acquired. All the challenges were repelled by the High Court. The High Court, in the judgment dated 30.11.2009 passed in Civil Misc. Writ Petition No.31314 of 2009 (Nand Kishore Gupta and Ors. vs. State of U.P. and Ors.), basically pointed out that out of 12,282 land owners, 11,397 had already received their compensation under the agreement and the challenge related only to 21.03 hectares out of 1,604 hectares of land. The High Court also took the view that the scales of justice must tilt towards the right to development of the millions who will be benefited from the road and the development of the area, as against the human rights of 35 petitioners therein, whose main complaint was that they were not heard before the declaration under Section 6 of the Act. The High Court also declined to give any direction to the State Government to consider to exempt 21.03 hectares of land re....
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....n dated 15.6.2009 under Section 6(1) read with Sections 17(1) and 17(4) of the Act. It is mainly the complaint of the appellants that they had purchased the land long time back and their names were duly mutated in the Revenue records and they had thereafter raised constructions over the land in question, and in those constructions, they were running their business like shops, cold-storage etc. The appellants also complained that the area which was proposed to be cleared for the interchange, if acquired, the appellants would suffer immensely. The appellants very seriously challenged the application of urgency under Sections 17(1) and 17(4) of the Act to these acquisitions, thereby depriving the appellants of an opportunity to be heard under Section 5A of the Act. Even before us, that is the main thrust of the arguments on behalf of the appellants. 6. The other major challenge opposing the acquisition related to the concept of public purpose'. It was tried to be suggested that this was in fact an acquisition without any public purpose for the Company-J.P. Infratech Ltd.-respondent No.5 and would be covered under Part VII of the Act. In that, the learned Counsel appearing on be....
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.... (2) that the tender process itself was faulty; and (3) that the terms of contract were unconscionable and against the public interest. 10. All the three challenges were refuted by the Division Bench of the High Court by referring to the Report itself which was filed before it at the instance of the State Government. It recorded a finding that there was no mala fide on the part of anybody. The Commission had also come to the conclusion that the Agreement with the Company was arrived at after proper scrutiny on the part of the Government Officers and there was no mala fide on the alleged connection of one Shri Anup Mishra or his father with the Company. The Division Bench affirmed this finding. The Division Bench also recorded a finding that the petitioner therein was not able to place any other material on record to show that the process itself was faulty or that the terms of contract were unconscionable and against the public interest. While considering the amendment made by the petitioner to the Writ Petition by which fresh challenges were thrown against the Agreement dated 7.2.2003, the Division Bench came to the conclusion that there was no procedural infirmity in ....
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.... this acquisition is not covered by the definition of public purpose' in Section 3 (f) of the Land Acquisition Act. (b) it cannot be said that this acquisition would come under Part II of the Land Acquisition Act and in fact it must be considered to be under Part VII of the Act since it virtually amounts to acquisition of land for J.P. Infratech-a company(respondent No.5). (c) the compensation for the land acquisition is coming wholly from the Jaypee Industries and not from the Government or from YEIDA and, therefore, it is not an acquisition for public purpose. (d) the acquisition for so-called interchange is not at all necessary and it is actually a colourable exercise of powers. 2. The application of Sections 17 (1) and 17 (4) of the Land Acquisition Act was wholly unnecessary and, therefore, illegal, (a) and, therefore, the Government could not have dispensed with the enquiry under Section 5 A of the Act. 14. Learned Counsel appearing on behalf of the appellants argued in support of the above two main and the ancillary questions. 15. As against this, learned Counsel appearing for the State as also for the Company and YEIDA supported....
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....s along the said Expressway into a planned industrial development area for residential, industrial, institutional or recreational purposes. The industrial development area was also notified on 24.4.2001, which then comprised of 8 villages. Later on, vide notification dated 22.8.2001, as many as 63 No. of villages including the village of some of the appellants were also included. By further notifications, some more villages were also notified as part of industrial development area. The area was in 4 districts, namely, Gautam Budh Nagar, Agra, Mathura and Aligarh. 17. After the constitution of the Authority (YEIDA), public notices for global tenders were issued in 2001 inviting bids from interested parties desirous of implementing the Project of the said 6 lane Expressway and the building of the townships on Build, Operate and Transfer model. This Project, however, did not proceed, as there was no eligible bidder and ultimately, the selection process was dropped. Subsequently, in November, 2002, fresh bids were invited on the same principles, but with an option either to enter into a joint venture (JV) with the YEIDA or to implement the said Project without any equity partition o....
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.... appointed by the State Government under the Chairmanship of Mr. Justice Siddheshwar Narain (Retd.). Before that, two Commissions of sub enquiries were constituted. While the Report of the first Commission was quashed by the Allahabad High Court, the second Commission of Enquiry could not proceed at all, as the Members had resigned. Ultimately, Mr. Justice Siddheshwar Narain (Retd.) completed the enquiry and submitted his Report in October, 2006. Thereafter, as has already been pointed out earlier, a Public Interest Litigation came to be filed by way of a Writ Petition before the Allahabad High Court, which was dismissed by the Allahabad High Court. It was thereafter that the process of land acquisition commenced in September, 2007. In the first phase, land for Expressway was acquired. Subsequently, the acquisition process started for the land for development. The first Writ Petition being Civil Misc. Writ Petition No. 48978 of 2008 came to be filed by one Balbir Singh, challenging the Notification dated 15.10.2007 issued under Section 4 of the Act, as also the Notification dated 4.1.2008 issued under Section 6 of the Act. Status quo order was passed on the said Writ Petition. On i....
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....ukesh Singh vs. State of U.P. and Ors.), Civil Misc. Writ Petition No. 51546 of 2009 (Vijay Singh and Anr. vs. State of U.P. and Ors.), Civil Misc. Writ Petition No. 51551 of 2009 (Jagvir Singh and Ors. vs. State of U.P. and Ors.), Civil Misc. Writ Petition No. 60587 of 2009 (Kadival Infrastructure Pvt. Ltd. and Anr. vs. State of U.P. and Ors.) alongwith the main Writ Petition being Civil Misc. Writ Petition No.31314 of 2009 (Nand Kishore Gupta and Ors. vs. State of U.P. and Ors.). The individual grievances raised in all these Writ Petitions were dealt with and the challenges were rejected. The two main points, as culled out by us, were dealt with as in Balbir Singh's case. 21. Insofar as the individual grievances are concerned, they were mostly in the nature of plea regarding the constructions having been there in this land required for interchange. For example, in Nand Kishore Gupta's case, it was claimed that there was cold storage of the petitioner No. 1 therein and shops in cold storage, a temple in plot No. 139, a weigh bridge (Dharm Kanta) on plot No. 122 and some of the plots were owned by Trishul Awas Sahkari Awas Samiti. It was stated in Civil Misc. Writ Petiti....
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....n without any demur. It will, therefore, not be possible for us to go into these individual grievances, which have been rightly rejected by the High Court. In fact, in Balbir Singh's case, it was pointed out that out of the 12,315 affected farmers in 133 villages over the total area of 1,638 hectares of the Expressway, 11387 have already received compensation and only 142 farmers have raised the issues. The High Court has rightly held that the private interest is always affected to some extent in such large schemes requiring the acquisition of land. The High Court has rightly held that a holistic view had to be taken to look for an all round development without forgetting about our heritage, culture and traditions. We also, therefore, would not entertain the objections, feebly raised before us, individually. 23. We have now to see as to whether the challenge posed by the appellants herein about this acquisition not being for public purpose is justified or not. Shri Ranjit Kumar, Shri Debol Banerjee, learned Senior Counsel and Ms. Meenakshi Arora, learned Counsel appearing on behalf of the appellants, vehemently urged that this acquisition, in the first place, is colourable e....
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....sition and the State Government/YEIDA has not contributed anything. Heavily relying on the decision in Pratibha Nema and Ors. vs. State of M.P. and Ors. [2003 (10) SCC 626], the learned Counsel argued that this issue needs to be addressed by this Court on the backdrop of this case. 24. As against this, the learned Counsel appearing on behalf of the State, as also for the Company and YEIDA, pointed out that this cannot be said to be a colourable exercise of power. They also pointed out that there cannot be any dispute about the utility of this Project and its benefits to the public. They further pointed out that the whole process has been extremely transparent. They also pointed out that this acquisition cannot, under any circumstances, come within Part VII of the Act. The learned Counsel further pointed out that the five developed parcels of the land were going to revert to the acquiring body after 90 years, and the period of 90 years cannot provide a permanency to the whole transaction. The learned Counsel urged that the State ultimately was going to receive a 6 lane Expressway which was 160 Kilometers long alongwith five developed parcels of land on the Eastern Side of Yamuna ....
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.... Project, were 9 in number, owning about 7.09 hectares of land i.e. about 0.42% of the total land. It has been strongly argued on behalf of the State, the Company and YEIDA that the major activity of land acquisition process is over. It has been noted in Balbir Singh's case that out of the 12,315 affected farmers in 133 villages over the total area of 1,638 hectares of the Expressway, 11387 have already received compensation and only 142 farmers out of such a large number of villages have raised the issues, leaving 139 farmers who had not taken the compensation. This is apart from the fact that only 9 Writ Petitioners came in that Writ Petition. The story in Nand Kishore's Writ Petition which was disposed of by the High Court alongwith other Writ Petitions is no different. The learned Counsel appearing on behalf of the appellants could not deny the fact that the total number of petitioners concerned in these acquisition proceedings, coming up before the High Court, was extremely insignificant as compared to those who had accepted the compensation. of course, that by itself may not be the only reason to hold against the appellants (petitioners), however, that fact will have ....
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.... throughout the country. It was also pointed out that the offers were invited on the basis of a global tender and as many as 19 parties entered the fray, and that it is only thereafter that the present respondent Company was chosen for the award of the tender. Again, the essential features of the transaction appear to be that (i) Project was to be implemented on the Build Operate and Transfer model, (ii) Project conceived of the construction of the Expressway as well as development of land parcels at five different locations and (iii) the land for development was to be provided to the selected bidder on a lease of 90 years upon payment of acquisition cost and necessary lease rentals. There was, thus, a complete transparency in the whole affair. It is also to be seen that this was not a case where the exercise of power of eminent domain by the State was for any of the purposes set down in Section 40 of the Act. Further, it is not as if the power of acquisition was exercised by the State Government for the work or Project of the Company. Lastly, it is not a case where the power of exercise was exercised by the State Government so that the acquired land was to belong or vest permanent....
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....he Act. It was tried to be canvassed before us that there would be a difference in concepts of a public purpose and the work useful to the public. We are not much impressed by this argument in view of the fact that there is absolutely no evidence to suggest that this is an acquisition for the Company, basically on account of the fact that the acquired land is not to vest with the Company. This was clearly a Project conceived and justified by the State Government, while the concessionaire was to be chosen only to implement the Project. The Project was going to be implemented on the basis of principles of BOT. Therefore, after the operating period is over, the assets of the Project were to be transferred to the State Government. There was going to be no vesting of land as in case that if the acquisition was being effected under Part VII of the Act. We, therefore, do not accept the argument that this was either a colourable exercise of power or was meant for the Company. We are not impressed by the argument that this was an acquisition for the Company. The High Court, in Balbir Singh's judgment, has correctly come to the conclusion that this acquisition was not meant only for the ....
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....p the industrial culture created in the five parcels. Thus, both will be complimentary to each other and can be viewed as parts of an integral scheme. Therefore, it cannot be said that it is not a public purpose. 31. We must, at this stage, take into account the argument that the whole compensation is coming wholly from the Company and not from the Government or from YEIDA. The appellants invited our attention to Clause 4.1(d) of the Concession Agreement. On that basis, it was argued that the Company has paid the compensation cost and, therefore, the acquisition is clearly covered under Part VII of the Act, and there may be no public purpose if the acquisition is made for the Company and it is the Company who has to shell out the whole compensation. Now, this argument is clearly incorrect. Even if we accept for the sake of argument that all this compensation is coming from the Company, we must firstly bear it in mind that the Company gets no proprietary or ownership rights over the Project assets. Now, if it is presumed that the compensation is coming from the Company, then it will have to be held that the whole assets would go to the Company. At least that is envisaged in Part ....
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....ticularly, paragraphs 24 and 25 therein. The respondents also argued relying upon the decision in Naihati Municipality and Ors. vs. Chinmoyee Mukherjee and Ors. [1996 (10) SCC 632]. The respondents argued that the law laid down in Pratibha Nema's Case (cited supra) emanates from the judgment in Naihati Municipality and Ors. vs. Chinmoyee Mukherjee and Ors. (cited supra). 32. Two judgments in State of Karnataka and Ors. vs. All India Manufacturers Organization and Ors. [cited supra] and Sooraram Pratap Reddy and Ors. vs. District Collector, Ranga Reddy District and Ors. etc. etc. (cited supra) were pressed in service by the respondents. 33. The first judgment in State of Karnataka and Ors. vs. All India Manufacturers Organization and Ors. (cited supra) pertain to Bangalore-Mysore Infrastructure Corridor Project). While considering what the public purpose was, this Court in paragraphs 76, 77, 78 and 79 took stock of the contention, whereby it was suggested that land far away from the actual alignment of the road and periphery had been acquired and, therefore, even if the implementation of the highway Project was assumed to be for the public purpose, the acquisition of the l....
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....ipur) Ltd. vs. State of Uttaranchal and Ors. [2007 (8) SCC 418], where this Court has come to the conclusion that in the absence of illegality or violation of law, a Court of law will not interfere in the policy matters. Similar is the case here, where the development of the industrial infrastructure along the Expressway for the overall betterment of the region and further for the industrialization of the otherwise backward region of Uttar Pradesh, was considered as a policy. In this judgment again, the Court has extensively considered the question as to whether and under what circumstances, the acquisition could be said to be the acquisition for the Company. In that, the Court has also considered the decision in Babu Barkya Thakur vs. State of Bombay [AIR 1960 SC 1203]. The Court quoted the observations in the aforementioned decision in Babu Barkya Thakur vs. State of Bombay (cited supra) to the following effect:- "These requirements indicate that the acquisition for a Company also is in substance for a public purpose inasmuch as it cannot be seriously contended that constructing dwelling houses, and providing amenities for the benefit of the workmen employed by it and co....
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....ated and indivisible Project. In the reported judgment of Sooraram Pratap Reddy and Ors. vs. District Collector, Ranga Reddy District and Ors. etc. etc. (cited supra), it has also been found that the entire amount of the compensation was to be paid by the State agency APIIC, just like in the present case, where the entire amount is to be paid by YEIDA, which agency is working as a nodal agency for the execution of the Project. The Court has also found that where the power of eminent domain is exercised mala fide or for collateral purposes and de hors the Act or in an irrational or unreasonable manner or when the purpose is no public purpose' and the fraud on statute is apparent, a Writ Court can undoubtedly interfere. It has been found very specifically here that the present matter is not suffering from the above defects. In this judgment, the subject of eminent domain has been discussed and considered with thoroughness and all the ramifications of the principle of eminent domain have been discussed. We have already culled out the principles emanating from this decision in the earlier part of this judgment and even at the cost of repetition, we may say that this judgment is pra....
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.... fails to utilize the entire land acquired, the unutilized portion would revert to the Government. The respondents argued that in a BOT contract, the land is only leased to a third party agency for the purposes of implementation of the Project. There is no occasion for declaring the transfer of land to be null and void. There would also be no occasion for reversion of the utilized land of the State Government. The respondents, therefore, argued that a BOT contract can never be contemplated as falling under Part VII of the Act. 37. Some other decisions which were pressed in service by the appellants are Smt. Somavanti and Ors. vs. The State of Punjab and Ors. [AIR 1963 SC 151], more particularly, the observations in paragraph 40 therein, where the Constitution Bench of this Court observed that if the purpose of acquisition is not related to a public purpose, then a question may well arise whether in making the declaration there has been on the part of the Government, a fraud on the power conferred on it by the Act. We have already discussed the factual situation here for pointing out that this acquisition was indeed for the public purpose and cannot be held to be for respondent C....
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....nicety of the question and observed that in a case of acquisition for a public Company, public purpose is not to be assumed and the point of distinction between acquisition of lands under Part II and Part VII of the Act would be the source of funds to cover the cost of acquisition. The Court also considered the judgment of this Court in Smt. Somavanti and Ors. vs. The State of Punjab and Ors. (cited supra), Jage Ram and Ors. vs. State of Haryana and Ors. [1971 (1) SCC 671] and Shyam Behari and Ors. vs. State of Madhya Pradesh and Ors. [AIR 1965 SC 427]. Ultimately, the Court came to the conclusion that the necessary provisions not having been found, the view of the High Court was not correct, whereby it had upheld the land acquisition, holding it to be for the public purpose. We have closely seen the judgment; however, the factual situation in the judgment is quite different. In our opinion, the judgment will not help the appellants to contend that the present land acquisition is not for public purpose. We also do not think that there is any serious conflict between the decision in Pratibha Nema's Case (cited supra) and the decision in Devinder Singh and Ors. vs. State of Punja....
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....also pointed out by the respondents that because of the unnecessary litigation in the enquiries, the Project was hopelessly delayed and the cost had gone up from Rs. 1,700 crores to whopping Rs. 9,700 crores. It was also further pointed out that any waste of time would have invited the encroachments on the land, which would have added to the further trouble. The enormousness of the Project which required acquisition of 1,604 hectares of land involving 12,283 farmers, would have taken years if the enquiry under Section 5A was permitted and thereby, the cost would have still further soared up. Numbers of authorities were relied upon by the parties. 39. Before considering the issue, we must take stock of the finding returned by the High Court. In the judgment in Nand Kishore Gupta and Ors. vs. State of U.P. and Ors. (Civil Misc. Writ Petition No.31314 of 2009), the High Court took stock of the allegations regarding malafides and dispensing with the enquiry under Section 5A of the Act by referring to Paragraph Nos. 20, 21, 28, 29, 30, 31 and 32 of the Reply filed on behalf of the State Government through an affidavit of one Shri Vinod Kumar Singh, ADM, Land Acquisition, Agra, wherei....
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....t then referred to the delay on account of the litigations from 2001 till 2008 and referred to the contention raised on behalf of the appellants relying on the judgment in Essco Fabs Pvt. Ltd. and Anr. vs. State of Haryana and Anr. etc. etc. [2009 (2) SCC 377], Mahender Pal and Ors. vs. State of Haryana and Ors. [2009 (14) SCC 281] and Babu Ram and Anr. vs. State of Haryana and Anr. (cited supra). It then recorded a finding in the following words:- "In order to verify whether there was any material with the State Government to form an opinion and to exercise its powers under Section 17(1) and Section 17(4) of the Act, dispensing with enquiry under Section 5A of the Act, and that the State Government had applied its mind on such material, we summoned the records of the three concerned notifications. Shri Satish Chaturvedi, Addl. Advocate General assisted by Shri M.C. Tripathi, Addl. Chief Standing Counsel has produced the records alongwith the material collected by the Collectors/District Magistrate and placed before the State Government for forming an opinion. He has taken us through the various documents and forms on which the Collectors have recommended on Forms X alongw....
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....pal Secretary to Chief Minister on 18.2.2009. As regard the acquisition of land for Y.E.I.D.A. for interchange in village Malupur for construction of Yamuna Expressway, Pargana Atmadpur, district Agra for acquisition of 4.5322 hects. of land the proposal with recommendation of District Magistrate, Agra on Form-X and the justification similar to and in the same language as in the case of village Kuberpur, district Agra was placed before the State Government alongwith the notings. The proposal bears recommendations and signature of Under Secretary, Industrial Development Department, Government of U.P. on 23.10.2008 ; Special Secretary, Industrial Development, Government of U.P. on 24.10.2008; Principal Secretary, Industrial Development and Commissioner on 30.11.2008 ; Special Secretary, Industrial Development on 10.12.2008 and the Secretary to Chief Minister on 15.12.2008. For village Tappal in Tehsil Khair, district Aligarh proposal for acquisition of 48.572 hect. of land for Y.E.I.D.A. for construction of Yamuna Expressway with the recommendation of the District Magistrate and justification for invoking urgency clause was placed before the State Government and was....
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....n support of the satisfaction on the part of the Executive justifying the invocation of the provisions of Section 17. The position is no different in the present case. The High Court in the present matter went a step ahead and examined the bulky original record itself to find that there was full material available. 40. We are not impressed by the argument that the encroachment issue was not a relevant factor. This argument was based on the reported decision in Om Prakash and Anr. vs. State of U.P. and Ors. (cited supra). It must be said that the actual scenario in that case was different. In that case, the Court was considering the acquisition of area of about 500 acres comprising of 437 plots, whereas, in the present case, the area to be acquired for the Expressway alone was more than 1,600 hectares. This is apart from the 25 million square meters of land which was liable to be acquired for the purposes of development of 5 land parcels. There was interlinking between the acquisition of land for the highway and the acquisition of land for establishing the 5 townships. In Om Prakash and Anr. vs. State of U.P. and Ors. (cited supra), there was unexplained delay after issuance of S....