Supreme Court of India
AKHIL BHARTIYA UPBHOKTA CONGRESSversusSTATE OF MADHYA PRADESH AND ORS.
- Citation
- 2011 INSC 279
- Decided
- 6 April 2011
- Disposal
- Appeal(s) allowed
- Bench
- G S SINGHVI
Holding
Allotment of land to respondent No.5 without advertisement and the subsequent modification of the development plan under Section 23‑A were unconstitutional violations of Article 14 and ultra vires the statutory scheme.
Summary
The appellant, a public‑spirit organization, challenged the State of Madhya Pradesh's reservation and allotment of 20 acres of Nazul land to the Shri Kushabhau Thakre Memorial Trust (later respondent No.5) on the ground that the process violated Article 14 of the Constitution. The land was allotted without any public advertisement or invitation to similarly situated institutions, and the premium was substantially waived, indicating favoritism and nepotism. The Court examined the statutory framework under the Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973 and the Revenue Book Circular, finding no provision permitting such non‑transparent allotment. It also held that the modification of the Bhopal Development Plan under Section 23‑A was ultra vires because the purpose for which the land was allotted did not fall within the limited categories authorized by the statute. Relying on extensive administrative‑law jurisprudence, the Court declared the allotment illegal, quashed the related notifications, and ordered the land to be taken over and the premium refunded. The appeal was allowed, setting aside the High Court’s dismissal of the writ petition.
Issues considered
- The validity of the State's reservation and allotment of Nazul land to a private trust without public advertisement or invitation to other eligible entities under Article 14.
- Whether the State's modification of the Bhopal Development Plan under Section 23‑A of the Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973, was within the statutory limits.
- The applicability of the Madhya Pradesh Revenue Book Circular and the Act's provisions on the transfer of government land without auction or advertisement.
- The locus standi of a public‑spirited organization to challenge the allotment.
Legislation cited
- Constitution of Indias. Article 14, s. Article 39(b)
- Indian Trusts Act, 1882s. 11, s. 2, s. 32, s. 33, s. 4, s. 5, s. 6, s. 8
- Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973s. 13, s. 14, s. 15, s. 16, s. 17, s. 17-A, s. 18, s. 19, s. 20, s. 21, s. 22, s. 23-A, s. 24, s. 25, s. 26, s. 3, s. 38, s. 49, s. 5, s. 50, s. 58, s. 85
- Madhya Pradesh Public Trusts Act, 1951s. 3, s. 5, s. 6
- Madhya Pradesh Revenue Book Circular (RBC)s. 13(1), s. 13(2), s. 20, s. 21, s. 24, s. 26, s. Part IV
Subjects
Article 14EqualityAdministrative lawDiscretionFavoritismNepotismLand allotmentNazul landDevelopment planSection 23-AMadhya PradeshPublic trustPublic interest litigation
Judgment
[2011) 5 S.C.R. 77
AKHIL BHARTIYA UPBHOKTA CONGRESS A
v.
STATE OF MADHYA PRADESH AND ORS.
(Civil Appeal No. 2965 of 2011)
APRIL 6, 2011 B
[G.S. SINGHVI AND ASOK KUMAR GANGULY, JJ.]
Constitution of India, 1950:
Article 14 - Principle of equality - Exercise of power by C
political entities and officers/officials - Scope of - Held: For
achieving the goals of Justice and Equality set out in the
Preamble, the State and its agencies/instrumentalities have
to function through political entities and officers/officials at
different levels - The exercise of power by political entities and D
officers/officials for providing different kinds of services and
benefits to the people always has an element of discretion,
which is required to be used in larger public interest and for
public good and in a rational and judicious manner without
any discrimination against anyone - In Indian constitutional E
structure, no functionary of the State or public authority has
an absolute or unfettered discretion - The very idea of
unfettered discretion is totally incompatible with the doctrine
of equality enshrined in the Constitution and is an antithesis
to the concept of rule of law - Administrative law.
F
Part Ill; IV; Article 39(b) - Role of the State - Discussed.
Administrative law: State and/or its agencies!
instrumentalities - Action/decision of, to give largesse or
confer benefit on any person - Held: Must be founded on a G
sound, transparent, discernible and well defined policy, which
shall be made known to the public by publication in the Official
Gazette and other recognized modes of publicity and such
policy must be implemented/executed by adopting a non-
77 H
78 SUPREME COURT REPORTS [2011] 5 S.C.R.
A discriminatory or non-arbitrary method irrespective of the class
or category of persons proposed to be benefitted by the policy
- Distribution of largesse such as allotment of land by the
State and its agencies/instrumentalities should always be
done in a fair and equitable manner and the element of
s favoritism or nepotism should not influence the exercise of
discretion, if any, conferred upon the particular functionary or
officer of the State - By entertaining applications made by
individuals, organisations or institutions for allotment of land
or for grant of any other type of largesse, the State cannot
c exclude other eligible persons from lodging competing claim
- The competent authority should, as a matter of course, issue
an advertisement incorporating therein the conditions of
eligibility so as to enable all similarly situated eligible
persons, institutions/organisations to participate in the process
of allotment, whether by way of auction or otherwise - The
0
allotment of land which carry the tag of caste, community or
religion is not only contrary to the idea of Secular Democratic
Republic but is also fraught with grave danger of dividing the
society on caste or communal lines - The allotment of land
E to such bodies/organisations/institutions on political
considerations or by way of favoritism or nepotism is
constitutionally impermissible - In the instant case,
reservation and allotment of land to respondent no.5 was not
preceded by any advertisement in the newspaper or by any
other recognized mode of publicity inviting applications from
F organizations/institutions for allotment of land and everything
was done by the political and non-political functionaries of the
State as if they were under a legal obligation to allot land to
respondent No.5 - The advertisements issued by the State
functionaries were only for inviting objections against the
G proposed reservation and/or allotment of land in favour of
respondent no.5 and not for participation in the process of
allotment - Therefore, allotment of land to respondent No.5
was not done by following a procedure consistent with Arlicle
14 of the Constitution.
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 79
OF MADHYA PRADESH AND ORS.
Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, A
1973:
Object of its enactment - Discussed.
s.23-A - Development Plan - Modification of - Whether
notifications by which the Bhopal Development Plan was 8
modified and land use was .changed were ultra vires the
provisions of s. 23-A - Held: The power of modification of
development plan can be exercised only for specified
purposes- In terms of s.23-A(1)(a), the development plan can
be modified by the State Government either suo motu or at C
the request of the Authority for any proposed project of the
Government of India or the State Government and its
enterprises or for any proposed project relating to
development of the State or for implementing a scheme of
the Authority- In the instant case, in the Bhopal Development D
plan, the use of land which was reserved and allotted to
respondent No. 5 was shown as public and semi-public
(health) - State Government modified the plan by invoking
s.23-A(1)(a) for facilitating establishment of an institute by
respondent No. 5 - The exercise undertaken for the change E
of land use, which resulted in modification of the development
plan was an empty formality because land was allotted to
respondent No. 5 almost two years prior to the issue of
notification u/s. 23"'"'A (1 )(a) and the objects for which
respondent No. 5 was registered as a trust had no nexus with F
the purpose for which modification of development plan could
be effected under that section - Therefore, modification of the
development plan was ultra vires the provisions of s.23-
A(1)(a) - Urban development.
Madhya Pradesh Revenue Book Circular: Unregistered G
societies and private trusts are not eligible for allotment of
land.
Writ petition: Locus standi - Held: Even if a person files
H
80 SUPREME COURT REPORTS [2011] 5 S.C.R.
A a writ petition for vindication of his private interest but raises
question of public importance involving exercise of power by
men in authority then it is the duty of the Court to enquire into
the matter.
On 18.6.2004, one 'KJ' made a written request to the
8
Principal Secretary, Housing describing himself as a
Convenor of a Memorial Trust for reservation of 30 acres
land comprised in village Bawadiya Kalan, in favour of
the Memorial Trust to enable it to establish an All India
C Training Institute. Although said letter was addressed to
the Principal Secretary, Housing, the same was handed
over to the then Minister of Housing who forwarded it to
the Principal Secretary, Housing for immediate action.
Subsequently, 'KJ' applied for registration of the trust in
the name of respondent No. 5. The certificate of
D registration was issued on 24.12.2004. In the meanwhile,
'KJ' sent letter dated 11.8.2004 to the Principal Secretary,
Housing wherein he described himself as the Managing
Trustee of respondent No.5 and submitted fresh proposal
for reservation of 30 acres land out of Khasra Nos.82/1
E and 83 of village Bawadiya Kalan in favour of respondent
No.5.
The Director, Town Planning (Respondent No.3)
informed the Principal Secretary, Housing stating that in
F the Bhopal Development Plan, 2005, land comprised in
Khasra No.82 of Bawadiya Kalan village was earmarked
for public and semi-public (health) purpose and land
comprised in Khasra No.83 was earmarked for residential
purpose and if land was to be allotted to the Memorial
Trust, then the earlier land use would be required to be
G cancelled. However, without effecting change of land use
by following the procedure prescribed under the Act, the
State Government issued order reserving 30 acres land
comprised in Khasra Nos. 82/1 and 83 of village
Bawadiya Kalan in favour of the Memorial Trust.
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 81
OF MADHYA PRADESH AND ORS.
In view of the directive issued by the State A
Government , Tehsildar, Capital Project (Nazul) issued
advertisement dated 4.10.2004 and invited objections
against the proposed allotment to the Memorial Tru~t. The
same was published in newspaper. However just after
two days, the Collector (respondent No.4) submitted B
proposal for allotment of 30 acres land to the Memorial
Trust wherein it clearly indicated that the land fell within
the limits of Bhopal Municipal Corporation and, as such,
in terms of Chapter IV-1 of the Madhya Pradesh Revenue
Book Circular (RBC), the same should not be allotted at c
a price less than the minimum price. He also indicated
that price of the land would be Rs.7,84,8000/-, of which
10 per cent should be deposited as a condition for
allotment. After 2Yz months, respondent No. 4 sent letter
to the Additional Secretary, Revenue Department D
informing about non-deposit of 10 per cent of the
premium by the Memorial Trust. On coming to know about
the said communications, 'KJ' sent letters to respondent
No. 4 and Secretary, Revenue Department respectively
assuring that the premium would be deposited
E
immediately after the allotment of land. After about 8
months of the submission of proposal for allotment of
land to the Memorial Trust, 'KJ' sent letter to respondent
No. 4 mentioning therein that the institute would require
only 20 acres land. Thereupon, Nazul Officer sent letter
informing 'KJ' that the premium of 20 acres land would F
be Rs.5,22, 72,000/- and 10 per cent thereof i.e.
Rs.52,27,200/- should be deposited as earnest money.
However, the deposit of only Rs. 25,00,000/- was made
on behalf of respondent No. 5. For next about seven
months, the matter remained under correspondence G
between different departments of the State Government.
During the interregnum, the Minister of Housing became
Chief Minister of the State. On 24.10.2005, Chief Minister
of the State directed that matter relating to allotment of
H
82 SUF~EME COURT REPORTS (2011) 5 S.C.R.
A land to respondent No.5 be put up in the next meeting of
the Cabinet scheduled to be held on 26.10.2005. On the
same day, Secretary, Revenue Department submitted a
detailed note and suggested that keeping in view the
limited resources available with the State Government,
B land should be auctioned so that the administration may
garner maximum revenue. His suggestion was not
accepted by the Council of Ministers, which decided to
allot 20 acres land in the name of the Memorial Trust at
the rate of Rs.40 lakhs per hectare. The decision of the
c State Government was communicated to respondent No.
4. As a sequel to the allotment of land, Nazul Officer
called upon 'KJ' to deposit Rs. 55,94,000/-. However,
instead of depositing the amount 'KJ' addressed letter to
the Revenue Minister with the request that the premium
0 may be waived because the Institute was being
established in public interest and would be training the
elected representatives and undertaking research on
important issues and it would have no source of income.
The political set up of the State Government readily
E obliged him inasmuch as the issue was considered in the
meeting of Council of Ministers held and it was decided
that the amount of Rs. 25,00,000/- may be treated as the
total premium and land be given to the Memorial Trust by
charging annual lease rent of Re.1 only. Subsequently,
on a representation made by 'KJ', earlier orders/
F communications were amended and the name of
respondent No. 5 was inserted in place of the Memorial
Trust. Thereafter, lease agreement was executed between
the State Government and Secretary of respondent No.5
in respect of 20 acres land for a period ending on
G 05.12.2037 at a premium of Rs. 25,00,000/- and an yearly
rent of Re.1. Since the use of land comprised in Khasra
Nos. 82/1 and 83 of village Bawadiya Kala was shown in
the Bhopal Development Plan as public and semi-public
{health) and the same could not have been utilized for the
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 83
OF MADHYA PRADESH AND ORS.
purpose of respondent No. 5, the State Government A
issued notification dated 6.6.2008 under Section 23-
A(1 ){a). of the Act proposing change of land use from
public and semi-public (health) to public and semi public
and invited objections/suggestions. The notification was
published in the Official Gazette and two newspapers. B
Objections were filed by various persons against the
proposed change of land use which were held untenable
after giving opportunity of hearing. Thereafter, final
notification dated 5.9.2008 was issued under Section 23-
~) ~ fue~ C
The appellant, engaged in public and consumer
welfare activities challenged the allotment of land to
respondent No.5 in writ petition on the grounds of
violation of Article 14 of the Constitution and arbitrary
exercise of power. The High Court summarily dismissed D
the writ petition by observing that land belonged to the
Government and it was for the Government to decide
whom the same should be allotted as per its policy and
that no case of violation of any legal or constitutional
right was made out. E
The question which arose for consideration in the
instant appeal was whether the decision of the State
Government to allot 20 acres land comprised in Khasra
Nos. 82/1 and 83 of village Bawadiya Kalan, Tehsil Huzur, F
District Bhopal to the Memorial Trust without any
advertisement and without inviting other similarly situated
organisations/institutions to participate in the process of
allotment was contrary to Article 14 of the Constitution
and the provisions of the Madhya Pradesh Nagar Tatha G
Gram Nivesh Adhiniyam, 1973 and whether modification
of the Bhopal Development Plan and change of land use
was ultra vires the mandate of Section 23A of the Act.
Allowing the appeal, the Court
H
84 SUPREME COURT REPORTS [2011] 5 S.C.R.
A HELD: 1.1. The Madhya Pradesh Nagar Tatha Gram
Nivesh Adhiniyam, 1973 (the Act) was enacted to make
provisions for planning and development and use of
land; to make better provisions for the preparation of
development plans and zoning plans with a view to
B ensure that town planning schemes are made in a proper
manner and they are effectively executed. The Act also
provides for constitution of Town and Development
Authority for proper implementation of Town and Country
Development Plan and for the development and
c administration of special areas through Special Area
Development Authority and also to make provisions for
the compulsory acquisition of land required for the
purpose of the development plans and for achieving the
objects of the Act. In exercise of the powers conferred
upon it under Section 58 read with Section 85, the State
0
Government framed the Rules. There is no provision in
the Act or the Rules for disposal and/or transfer of land
in respect of which a regional plan or development plan
or zonal plan has been prepared. The only provision
which has nexus with the Government land is contained
E in Rule 3 which imposes a bar against the transfer of
Government land vested in or managed by the Authority
except with the general or special sanction of the State
Government. [Paras 10, 11, 12] [108-F-H; 116-C-H; 117-A-
B]
F
1.2. Part IV of the RBC deals with the management
and regulation of Nazul land falling within the limits of
municipal corporations, municipal councils and notified
areas; and transfer thereof by lease, sale etc. In terms of
G paragraph 13(1), permanent lease can be granted either
by auction or without auction. Paragraph 13(2)
enumerates the contingencies in which permanent lease
cannot be granted by auction. If the plot of land is to be
sold by auction then the same is required to be
H advertised or publicized by a recognized method,
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 85
OF MADHYA PRADESH AND ORS.
Paragraph 21 prescribes the mode of auction of lease A
rights. Any person desirous of participating in the
auction is required to deposit 10 per cent of the premium.
Once the bid is approved by the competent authority, the
bidder has to deposit the balance amount within 30 days.
Paragraph 24 lays down the procedure to be followed for 8
disposal of plot without auction. If any plot is proposed
to be transferred at a concessional premium then the
approval of the State Government is sine qua non. In
case, the Collector is satisfied that the plot of land should
be given without auction then the allottee is required to C
pay premium equivalent to average market price
determined on the basis of the sale instances of last five
years. Paragraph 26 lays down that when Nazul land is
allotted to non-government organisations or persons on
favourable terms then the conditions specified therein
should be scrupulously observed and there should be 0
rigorous scrutiny of the .proposal. Under this paragraph,
land can be allotted to educational, cultural and
philanthropic institutions/organisations or Cooperative
Societies, Housing Board and Special Area Authority
constituted by the State Government. However, E
unregistered societies and private trusts are not eligible
for allotment of land. [Para 13] [117-B-E; 118-A-H]
1.3. The concept of 'State' has changed in recent
years. In all democratic dispensations the State has F
assumed the role of a regulator and provider of different
kinds of services and benefits to the people like jobs,
contracts, licences, plots of land, mineral rights and social
security benefits. In his work "The Modern State" Maciver
(1964 Paperback Edition) advocated that the State should G
be viewed mainly as a service corporation. When the
Constitution was adopted, people of India resolved to
c_gr;tstitute India into a Sovereign Democratic Republic.
The words 'Socialist' and 'Secular' were added by the
H
86 SUPREME COURT REPORTS [2011] 5 S.C.R.
A Constitution (Forty-second Amendment) Act, 1976 and
also to secure to all its citizens Justice - social, economic
and political, Liberty of thought, expression, belief, faith
and worship; Equality of status and/or opportunity and
to promote among them all Fraternity assuring the dignity
8 of the individual and the unity and integrity of the Nation.
The expression 'unity of the Nation' was also added by
the Constitution (Forty-second Amendment) Act, 1976.
The idea of welfare State is ingrained in the Preamble of
the Constitution. Part Ill of the Constitution enumerates
C fundamental rights, many of which are akin to the basic
rights of every human being. This part also contains
various positive and negative mandates which are
necessary for ensuring protection of the Fundamental
Rights and making them real and meaningful. Part IV
contains 'Directive Principles of State Policy' which are
D fundamental in the governance of the country and it is
the duty of the State to apply these principles in making
laws. Article 39 specifies certain principles of policy which
are required to be followed by the State. Clause (b)
thereof provides that the State shall, in particular, direct
E its policy towards securing that the ownership and
control of the material resources of the community are so
distributed as best to sub-serve the common good.
Parliament and Legislatures of the States have enacted
several laws and the governments have, from time to
F time, framed policies so that the national wealth and
natural resources are equitably distributed among all
sections of people so that have-nots of the society can
aspire to compete with haves. For achieving the goals of
Justice and Equality set out in the Preamble, the State
G and its agencies/instrumentalities have to function
through political entities and officers/officials at different
levels. The laws enacted by Parliament and State
Legislatures bestow upon them powers for effective
implementation of the laws enacted for creation of an
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 87
OF MADHYA PRADESH AND ORS.
egalitarian society. The exercise of power by political A
entities and officers/officials for providing different kinds
of services and benefits to the people always has an
element of discretion, which is required to be used in
larger public interest and for public good. In principle, no
exception can be taken to the use of discretion by the B
political functionaries and officers of the State and/or its
agencies/instrumentalities provided that this is done in
a rational and judicious manner without any
discrimination against anyone. In Indian constitutional
structure, no functionary of the State or public authority c
has an absolute or unfettered discretion. The very idea
of unfettered discretion is totally incompatible with the
doctrine of equality enshrined in the Constitution and is
an antithesis to the concept of rule of law. [Paras 15, 16,
18] [119-H; 120-D-H; 121-A-B; 122-C-E] D
R.D. Shetty v. International Airport Authority of India
(1979) 3 sec 489 - relied on.
Ugar Sugar Works Ltd. v. Delhi Administration (2001) 3
SCC 635; State of U.P. v. Chaudhary Ram Beer Singh (2005) E
8 SCC 550; State of Orissa v. Gopinath Dash (2005) 13 SCC
495; Meerut Development Authority v. Association of
Management Studies (2009) 6 SCC 171; State of Uttar
Pradesh v. Bansi Dhar (1974) 1 SCC 447; Canbank
Financial Services Ltd. v. Custodian (2004) 8 SCC 355; F
Harsh Dhingra v. State of Haryana (2001) 9 SCC 550 -
referred to.
Administrative Law' (6th) Edition, Prof. H.W.R. Wade -
referred to.
G
1.4. The State and/or its agencies/instrumentalities
cannot give largesse to any person according to the
sweet will and whims of the political entities and/or
officers of the State. Every action/decision of the State
'
H
88 SUPREME COURT REPORTS [2011) 5 S.C.R.
A and/or its agencies/instrumentalities to give largesse or
confer benefit must be founded on a sound, transparent,
discernible and well defined policy, which shall be made
known to the public by publication in the Official Gazette
and other recognized modes of publicity and such policy
B must be implemented/executed by adopting a non-
discriminatory or non-arbitrary method irrespective of the
class or category of persons proposed to be benefitted
by the policy. The distribution of largesse like allotment
of land, grant of quota, permit licence etc. by the State
c and its agencies/instrumentalities should always be done
in a fair and equitable manner and the element of
favoritism or nepotism shall not influence the exercise of
discretion, if any, conferred upon the particular
functionary or officer of the State. There cannot be any
policy, much less, a rational policy of allotting land on the
0
basis of applications made by individuals, bodies,
organizations or institutions de hors an invitation or
advertisement by the State or its agency/instrumentality.
By entertaining applications made by individuals,
organisations or institutions for allotment of land or for
E grant of any other type of largesse the State cannot
exclude other eligible persons from lodging competing
claim. Any allotment of land or grant of other form of
largesse by the State or its agencies/instrumentalities by
treating the exercise as a private venture is liable to be
F treated as arbitrary, discriminatory and an act of
favoritism and nepotism violating the soul of the equality
clause embodied in Article 14 of the Constitution. This,
however, does not mean that the State can never allot
land to the institutions/organisations engaged In
G educational, cultural, social or philanthropic activities or ·
are rendering service to the Society except by way of
auction. Nevertheless, it is necessary to observe that
once a piece of land is earmarked or identified for
allotment to institutions/organisations engaged in any
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 89
OF MADHYA PRADESH AND ORS.
such activity, the actual exercise of allotment must be A
done in a manner consistent with the doctrine of equality.
The competent authority should, as a matter of course,
issue an advertisement incorporating therein the
conditions of eligibility so as to enable all similarly
situated eligible persons, institutions/organisations to B
participate in the process of allotment, whether by way
of auction or otherwise. In a given case the Government
may allot land at a fixed price but in that case also
allotment must be preceded by a wholesome exercise
consistent with Article 14 of the Constitution. The c
allotment of land by the State or its agencies/
instrumentalities to a body/organization/institution which
carry the tag Of caste, community or religion is not only
contrary to the idea of Secular Democratic Republic but
is also fraught with grave danger of dividing the society D
on caste or communal lines. The allotment of land to
such bodies/organisations/institutions on political
considerations or by way of favoritism or nepotism or
with a view to nurture the vote bank for future is
constitutionally impermissible. [Paras 31-34] [134-C-H;
E
135-A-G]
S.G. Jaisinghani v. Union of India AIR 1967 SC 1427 -
relied on.
Padfield v. Minister of Agriculture, Fishery and Food F
(1968) A.C. 997; Breen v. Amalgamated Engineering Union
(1971) 2 QB 175; Laker Airways Ltd. v. Department of Trade
1977 QB 643; V. Punnen Thomas v. State of Kera/a AIR
1969 Ker. 81 (Full Bench); Eursian Equipments and
Chemicals Ltd. v. State of West Bengal (1975) 1 SCC 70;
G
Kasturi Lal Lakshmi Reddy v. State of J And K (1980) 4 SCC
1; Common Cause, A Registered Society v. Union of India
(1996) 6 SCC 530; Shrilekha Vidyarthi v. State of U.P. (1991)
1 SCC 212; L.l.C. of India v. Consumer Education &
Research Centre (1995) 5 SCC 482; New India Public School
H
90 SUPREME COURT REPORTS [2011] 5 S.C.R.
A v. HUDA (1996) 5 SCC 510; Seven Seas Educational
Society v. HUDA AIR 1996 P&H) 229 - referred to.
2.1. Admittedly, the application for reservation of land
was made by 'KJ', in his capacity as convener of the
Memorial Trust. The respondents have not placed on
8 record any document to show that on the date of
application, the Memorial Trust was registered as a public
trust. During the course of hearing also no such
document was produced before the Court. It is also not
in dispute that respondent No. 5 was registered as a
C public trust only on 6.10.2004 i.e. after the order for
reservation of land in favour of the Memorial Trust was
passed. The allotment was also initially made in the name
of trust, but, later on, the name of respondent No. 5 was
substituted in place of the Memorial Trust. The exercise
D for reservation of 30 acres land and allotment of 20 acres
was not preceded by any advertisement in the newspaper
or by any other recognized mode of publicity inviting
applications from organizations/institutions like the
Memorial Trust or respondent No.5 for allotment of land
E and everything was done by the political and non-political
functionaries of the State as if they were under a legal
obligation to allot land to the Memorial Trust and/or
respondent No.5. The advertisements issued by the State
functionaries were only for inviting objections against the
F proposed reservation and/or allotment of land in favour
of the Memorial Trust and not for participation in the
process of allotment. Therefore, allotment of land to
respondent No.5 was not done after following a
procedure consistent with Article 14 of the Constitution.
G (Para 35] (135-H; 136-A-F]
2.2. Although, the objectives of respondent No. 5 are
laudable and the institute proposed to be established by
it is likely to benefit an important segment of the society
but the fact remains that all its trustees are members of a
H particular party and the entire exercise for the reservation
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 91
OF MADHYA PRADESH AND ORS.
and allotment of land and waiver of major portion of the A
premium was undertaken because political functionaries
of the State wanted to favour respondent No. 5 and the
officers of the State at different levels were forced to toe
the line of their political masters. [Para 36) [136-G-H]
B
2.3. There is no provision in the Act or the Rules and
. even in the RBC for allotment of land without issuing
advertisement and/or without inviting a·pplications from
eligible persons to participate in the process of allotment.
If there would have been such a provision in the Act or c
the Rules or the RBC the same could have been
successfully challenged on the ground of violation of
Article 14 of the Constitution. The argument that the
impugned allotment may not be annulled because the
State has a definite policy of allotting land to religious, D
social, educational and philanthropic bodies,
organisations/institutions without any advertisement or
inviting applications and without even charging premium
is liable to be rejected. From the lists annexed with the
affidavits, it did appear that the State and its functionaries E
have allotted various parcels of land to different
institutions and organizations between 1982 to 2008.
Large number of these allotments were made to the
departments/establishments of the Central Government/
State Governments and their agencies/instrumentalities.
Some plots were allotted to the hospitals and charitable F
institutions. Some were allotted to different political
parties, but quite a few were allotted to the caste/
community based bodies. Allotments were also made
without charging premium and at an annual rent of Re.
1/- only. These allotments cannot lead to an inference that G
the State Government has framed a well-defined and
rational policy for allotment of land. The RBC also does
not contain any policy for allotment of land without
issuing any advertisement and without following a
procedure in which all similarly situated persons can H
92 SUPREME COURT REPORTS [2011] 5 S.C.R.
A stake their claim for allotment. Part IV of the RBC
contains the definition of Nazul land and provides for
allotment of land at market price or concessional price.
The authorities competent to allot land for different
purposes have also been identified and provisions have
s been made for scrutiny of applications at different levels.
However, these provisions have been misinterpreted by
the functionaries of the State for several years as if the
same empowered the concerned authorities to allot Nazul
land without following any discernible criteria and in
c complete disregard to their obligation to act in
accordance with the constitutional norms. Unfortunately,
the High Court overlooked that the entire process of
reservation of land and allotment thereof was fraught with
grave illegality and was nothing but a blatant act of
favoritism on the part of functionaries of the State and
0
summarily dismissed the writ petition. [Paras 37 to 39]
[137-A-H; 138-A-C]
3.1. Whether notifications dated 6.6.2008 and
5.9.2008 by which the Bhopal Development Plan was
E modified are ultra vires the provisions of Section 23-A of
the Act.
3.1. A reading of the provisions contained in
Chapter-IV of the Act would make it clear that a
F development plan shall take into account the draft-five
year and annual development plan of the district, if any,
prepared under the Madhya Pradesh Zila Yogana Samiti
Adhiniyam and broadly indicated the land use proposed
in the planning area, allocation of areas or zones of land
G for residential, industrial, commercial or agricultural
purpose; open spaces, parks and gardens, green-belts,
zoological gardens and playgrounds; public institutions
and offices and other special purposes as the Director
may deem it fit. The development plan prepared under
Chapter IV is the foundation of development of the
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 93
. OF MADHYA PRADESH AND ORS.
particular area for a specified number of years. No one A
can use land falling within the area for which the
development plan has been prepared for a purpose other
than for which it is earmarked. Section 23-A was inserted
in 1992 and amended in 2005 with a view to empower the
State Government to modify the development plan or B
zoning plan. However, keeping in view the basic
objective of planned development of the areas to which
the Act is applicable, the Legislature designedly did not
give blanket power to the State Government to modify the
development plan. The power of modification of c
development plan can be exercised only for specified
purposes. In terms of Section 23-A(1 )(a), the development
plan can be modified by the State Government either suo
motu or <:.t the request of the Authority for any proposed
project of the Government of India or the State D
Government and its enterprises or for any proposed
project relating to development of the State or for
implementing a scheme of the Authority. Under clause
(b), the State Government can entertain an application
from any person or association of persons for
modification of development plan for the purpose of E
undertaking any activity or scheme which is considered
by the State Government or the Director, on the advice
of the committee constituted for this purpose, to be
beneficial to the society. This is subject to the condition
that the modification so made shall be an integral part of · F
the revised development plan. Section 23-A(2) provides
for issue of public notice inviting objections against the
proposed modification of the plan. Such notice is required
to be published along with the modified plan
continuously for two days in two daily newspapers which G
are on the list of the Government and which have
circulation in the area. A copy of the notice is also required
to be affixed in a conspicuous place in the office of the
Collector. After considering the objections and
H
94 SUPREME COURT REPORTS [2011] 5 S.C.R.
A suggestions, if any received, and giving reasonable
opportunity of hearing to the affected persons, the State
Government can confirm the modification. [Para 40] [138-
D-H; 139-A-F]
3.2. It is not in dispute that in the Bhopal
8
Development plan, the use of land which was reserved
and allotted to respondent No.5 was shown as public and
semi public (health). The State Government modified the
plan by invoking Section 23-A(1)(a) of the Act for the
C purpose of facilitating establishment of an institute by
respondent No. 5 and not for any proposed project of the
Government of India or the State Government and its
enterprises or for any proposed project relating to
development of the State or for implementaticn of the
Town Development Scheme. As a matter of fact, the
D exercise undertaken for the change of land use, which
resulted in modification of the development plan was an
empty formality because land had been allotted to
respondent No.5 almost two years prior to the issue of
notification under Section 23-A (1 )(a) and the objects for
E which respondent No.5 was registered as a trust have no
nexus with the purpose for which modification of
development plan can be effected under that section.
Therefore, modification of the development plan was ultra
vi res the provisions of Section 23-A(1 )(a) of the Act. [Para
F 41] [139-G-H; 140-A-C]
3.3. The challenge to the locus standi of the appellant
merits rejection because it has not been disputed that the
appellant is a public spirited organization and has
G challenged other similar allotment made in favour of
Punjabi Samaj, Bhopal. Even if a person files a writ
petition for vindication of his private interest but raises
question of public importance involving exercise of power
by men in authority then it is the duty of the Court to
H enquire into the matter. [Para 42] [140-D-E]
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 95
OF MADHYA PRADESH AND ORS.
Shivajirao Ni/angekar Patil v. Mahesh Madhav Gosavi A
(1987) 1 sec 227 - relied on.
3.4. The argument that the doctrine of prospective
overruling should be invoked and the allotment made in
favour of respondent No.5 may not be quashed sounds
8
attractive but cannot be accepted because that the
impugned allotment was held to be the result of an
exercise undertaken in gross violation of Article 14 of the
Constitution and was an act of favoritism and nepotism.
The impugned order of the High Court is set aside and
the writ petition filed by the appellant is allowed. The C
allotment of 20 acres land to respondent No.5 is declared
illegal and quashed. Notifications dated 6.6.2008 and
5.9.2008 issued by the State Government under Section
23-A(1)(a) and (2) are also quashed. The Commissioner,
Town and Country Planning, Bhopal is directed to take D
possession of the land and use the same strictly in
accordance with the Bhopal Development Plan. The State
Government is directed to refund the amount deposited
by respondent No.5 within a period of 15 days. [Paras 43-
45] [140-F-H; 141-A·E] E
S.R. Dass v. State of Haryana (1988 PLJ 123)- referred
to.
Case Law Reference:
F
(2001) 2 SCR 630 referred to Para 7
(2005) 8 sec 550 referred to Para 7
(2005) 5 Suppl SCR 699 referred to Para 7
(2009) 6 sec 663 referred to G
Para 7
(1974) 1 sec 447 referred to Para 7
(2004) 4 Suppl SCR 60 referred to Para 7
'
(2001) 3 Suppl SCR 446 referred to Para 8 H
96 SUPREME COURT REPORTS [2011] 5 S.C.R.
A (1968) A.C. 997 referred to Para 20
(1971) 2 QB 175 referred to Para 21
1977 QB 643 referred to Para 22
1967 SCR 703. relied on Para 23
B
AIR 1969 Ker. 81 referred to Para 24
(1975) 2 SCR 674 referred to Para 25
(1980) 3 SCR 1338 referred to Para 25
c
(1996) 6 Suppl SCR 719 referred to Para 26
(1990) 1 Suppl SCR 625 referred to Para 28
(1995) 1 Suppl SCR 349 referred to Para 29
•D (1996) 3 Suppl SCR 597 referred to Para 30
AIR 1996 P&H) 229 referred to Para 30
(1987) 1 sec 221 relied on Para 42
E (1988 PLJ 123) referred to Para 43
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
2965 of 2011.
From the Judgment & Order dated 10.03.2008 of the High
F Court of Judicature at Jabalpur (MP) in Writ Petition No. 10617
of 2007.
Raju Ramchandran, Santosh Kumar for the Appellant.
Ravi Shankar Prasad, Ranjit Kumar, B.S. Banthia, Vikas
G Upadhyay, Navin Chawla, Tushar Singh for the Respondents.
The Judgment of the Court was delivered by
G.S. SINGHVI, J. 1. Leave granted.
H
AKHIL BHARTIYA UPBHOKTA CONGRESS. v. STATE 97
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
2. Whether the decision of the Government of Madhya A
Pradesh to allot 20 acres land comprised in Khasra Nos. 82/1
and 83 of village Bawadiya Kalan, Tehsil Huzur, District Bhopal
to late Shri Kushabhau Thakre Memorial Trust (for short, "the
Memorial Trust")/Shri Kushabhau Thakre Training Institute
(respondent No. 5) without any advertisement and without B
inviting other similarly situated organisations/institutions to
participate in the process of allotment is contrary to Article 14
of the Constitution and the provisions of the Madhya Pradesh
Nagar Tatha Gram Nivesh Adhiniyam, 1973 (for short, "the Acf')
and whether modification of the Bhopal Development Plan and c
change of land use is ultra vires the mandate of Section 23A
of the Act are the questions which arise for consideration in this
appeal filed against the order of the Madhya. Pradesh High
Court dismissing the Writ Petition filed by the appellant.
· 3. That facts necessary for deciding the aforementioned D
questions have been culled out from the pleadings of the
parties and the records produced by the learned counsel for
the State. The same are enumerated below:
(i) On 18.6.2004, Shri Kailash Joshi. made a written E
request to the Principal Secretary, Housing Department,
Government of Madhya Pradesh (for short, "the Principal
SecretarY, Housing") by describing himself as a Convenor of
the Memorial Trust for reservation of 30 acres land comprised
in Khasra Nos.83, 85/1 and 85/2 of village Bawadiya Kalan, in F
favour of the Memorial Trust to enable it to establish an All India
Training Institute in the memory of late Shri Kushabhau Thakre.
(ii) Although, letter dated 18.6.2004 was addressed to the
Principal Secretary, the same was actually handed over to Shri
Babu Lal Gaur, the then Minister, Housing and Environment, G
Madhya Pradesh. He forwarded the same to the Principal
Secretary for immediate action. The latter directed that steps
be taken for placing the matter before the reservation
committee. Simultaneously, letters were issued to
H
98 SUPREME COURT REPORTS [2011) 5 S.C.R.
A Commissioner-cum-Director, Town and Country Planning,
Bhopal (respondent No.3) and Collector, Bhopal (respondent
No. 4) to send their respective reports.
(iii) Respondent No.3 submitted report dated 8.7.2004
indicating therein that as per Bhopal Development Plan, land
8
comprised in Khasra Nos.83 and 85/1 was reserved for
residential and plantation purposes and Khasra No.85/2 was
non government land. After going through the same, the
Principal Secretary, Housing opined that land cannot be
reserved for the Memorial Trust. However, Shri Rajendra
C Shukla, State Minister, Housing and Environment recorded a
note that he had requested the Coordinator of the trust to send
a revised proposal to the Government and directed that the new
proposal be put up before him.
D (iv) In his report dated 26. 7.2004, respondent No. 4
mentioned that land measuring 11.96 acres comprised in
Khasra No.86 and land measuring 22.06 acres comprised in
Khasra No.85/1 (total area 34.02 acres) was Nazool land and
the same was recorded in the name of the State Government
E and Khasra No.85/2 belonged to Bhoomidar. He also
mentioned that the land in question is covered by the Capital
Project but there are no trees, religious structure or electricity
lines, though a road was proposed by the Town and Country
Planning Department.
F (v) While the process initiated for reservation of land was
at a preliminary stage, Shri Kailash Joshi submitted an
application dated 31.7.2004 to the Registrar, Public Trust,
Bhopal (for short, 'the Registrar') under the Madhya Pradesh
Public Trusts Act, 1951 (for short 'the 1951 Act') for registration
G of a trust in the name of respondent No. 5 by escribing himself
and S/Shri M. Venkaiah Naidu, Lal Krishna Advani, Balwant P.
Apte and Sanjay Joshi as Trustees. In the application, Shri M.
Venkaiah Naidu was shown as the first President of the trust
and Shri Kailash Joshi as its Secretary and Managing Trustee.
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 99
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
(vi) After complying with the procedure prescribed under A
the 1951 Act, the Registrar passed order dated 6.10.2004 for
registration of the trust. The certificate of registration was
issued on 24.12.21304.
(vii) In the meanwhile, Shri Kailash Joshi sent letter dated
B
11.8.2004 to the Principal Secretary, Housing by describing
himself as Managing Trustee of respondent No.5 and submitted
fresh proposal for reservation of 30 acres land out of Khasra
Nos.82/1 and 83 of village Bawadiya Kalan in favour of
respondent No.5.
c
(viii) By letter dated 20.9.2004, respondent No. 3 informed
the Secretary, Housing and Environment Department
(respondent No.2) that 4665 acres land of villages Bawadiya
Kalan and Salaiya had already been notified in Madhya
Pradesh Gazette dated 2.5.2003 for town development scheme D
at Misrod. He also indicated that land in Khasra Nos.82 and
83 is included in the Scheme and notice to this effect had
already been published under Section 50 of the 1973 Act.
(ix) After some time, respondent No.3 sent letter dated
3.9.2004 to the Principal Secretary, Housing and pointed out E
that in the Bhopal Development Plan, 2005, land comprised in
Khasra No,.82 of Bawadiya Kalan village is earmarked for
public and semi-public (health) purpose and land comprised in
Khasra No.83 is earmarked for residential purpose. He also
indicated that out of the total area of Khasra No.83 i.e. 11.96 F
acres, 24 metre wide road is proposed and 33 metres land
adjacent to the bank of Kaliasot river is included in the green
belt and out of 6 acres land for residential purpose, 2 acres
had been reserved for office of the Madhya Pradesh Sanskrit
Board and thus, only 4 acres land was available. He sent G
another letter dated 21.9.2004 to the Principal Secretary,
Housing mentioning therein that use of land comprised in
Khasra No. 82/1 of village Bawadiya Kalan is shown as "health
under public and semi-public" in the Bhopal Development Plan
H
100 SUPREME COURT REPORTS (2011] 5 S.C.R.
A 2005 and use of the :-:nd comprised in Khasra No.83 is shown
as residential and if land is to be allotted to the Memorial Trust,
then the earlier land use will be required to be cancelled.
(x) However, without effecting change of land use by
B following the procedure prescribed under the Act, the State
Government issued order dated 25 .•9.2004 and reserved 30
acres land comprised in Khasra Nos. 82/1 and 83 of village
Bawadiya Kalan in favour of the Memorial Trust in anticipation
of approval by the land reservation committee, which was duly
granted.
c
(xi) As a sequel to the reservation of land, Deputy
Secretary, Revenue Department vide his letter dated 30.9.2004
directed respondent No.4 to immediately send proposal to
respondent No.3 for allotment of land to the Memorial Trust.
D
(xii) In view of the directive issued by the State
Government, Tehsildar, Capital Project (Nazul), Bhopal, on
being instructed to do so, issued advertisement dated
4.10.2004 and invited objections against the proposed
E allotment of 30 acres land to the Memorial Trust from Khasra
Nos.82/1 and 83 of village Bawadiya Kalan. The same was
published in "Dainik Pradesh Times". However just after two
days, respondent No.4 vide his letter dated 8.10.2004
submitted proposal for allotment of 30 acres land to the
Memorial Trust. In paragraph 6 of his letter, respondent No.4
F clearly indicated that the land falls within the limits of Bhopal
Municipal Corporation and, as such, in terms of Chapter IV-1
of the Madhya Pradesh Revenue Book Circular (for short, "the
RBC") , the same should not be allotted at a price less than
the minimum price. He also indicated that price of the land
G would be Rs.7,84,8000/-, of which 10 per cent should be
deposited as a condition for allotment. After 2Yz months,
respondent No. 4 sent letter dated 23.12.2004 to the Additional
Secretary, Revenue Department and informed him that the
Memorial Trust has not deposited 10 per cent of the premium.
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 101
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
(xiii) On coming to know the aforesaid communications, A
Shri Kailash Joshi sent letters dated 19.2.20005 and 20.3.2005
to respondent No. 4 and Secretary, Revenue Department
respectively and assured that the premium will be deposited
immediately after the allotment of land.
B
(xiv) After about 8 months of the submission of proposal
for allotment of 30 acres land to the Memorial Trust, Shri Kailash
Joshi sent letter dated 16.5.2005 to respondent No. 4
mentioning therein that the institute would require only 20 acres
land. Thereupon, Nazul Officer, Capital Project, Bhopal sent c
letter dated 24.6.2005 to Shri Kailash Joshi and informed him
that the premium of 20 acres land would be Rs.5,22,72,000/-
and 10 per cent thereof i.e. Rs.52,27,200/- should be deposited
as earnest money. However, the needful was not done and only
Rs. 25,00,000/- were deposited on behalf of respondent No.
5. . . 0
(xv) For next about seven months, the matter remained
under correspondence between different departments of the
State Government. During the interregnum, Shri Babu Lal Gaur
became Chief Minister of the State. On 24.10.2005, he directed E
that matter relating to allotment of land to respondent No.5 be
put up in the next meeting of the Cabinet scheduled to be held
on 26.10.2005. On the same day, Secretary, Revenue
Department submitted a detailed note and suggested that
keeping in view the limited resources available with the State F
Government, land should be auctioned so that the administration
may garner maximum revenue. His suggestion was not
accepted by the Council of Ministers, which decided to allot 20
acres land in the name of the Memorial Trust at the rate of ·
Rs.40 lakhs per hectare. The decision of the State Government G .
was communicated to respondent No. 4 vide order dated
27.1.2006.
(xvi) As a sequel to the allotment of land, Nazul Officer,
Capital Project vide his letter dated 29.2.2006 called upon Shri H
102 SUPREME COURT REPORTS [2011] 5 S.C.R.
A Kailash Joshi (Secretary of respondent No. 5) to deposit Rs.
55,94,000/-. However, instead of depositing the amount Shri
Kailash Joshi addressed letter dated 31.3.2006 to the Revenue
Minister. with the request that the premium may be waived
because the Institute was being established in public interest
B and will be training the elected representatives and undertaking
research on important issues and it will have no source of
income. The political set up of the State Government readily
obliged him inasmuch as the issue was considered in the
meeting of Council of Ministers held on 9.5.2006 and it was
c decided that the amount of Rs. 25,00,000/- may be treated as
the total premium and land be given to the Memorial Trust by
charging annual lease rent of Re.1 only. This decision was
communicated to respondent No. 4 vide letter dated
19.6.2006.
D (xvii) Subsequently, on a representation made by Shri
Kailash Joshi, orders/communications dated 25.9.2004,
27.1.2006 and 19.6.2006 were amended and the name of
respondent No. 5 was inserted in place of the Memorial Trust.
Thereafter, lease agreement dated 6.1.2007 was executed
E between the State Government and Secretary of respondent
No.5 in respect of 20 acres land for a period ending on
05.12.2037 at a premium of Rs. 25,00,000/- and an yearly rent
of Re.1.
F (xviii) Since the use of land comprised in Khasra Nos. 82/
1 and 83 of village Bawadiya Kala was shown in the Bhopal
Development Plan as public and semi-public (health) and the
same could not have been utilized for the purpose of
respondent No. 5, the State Government issued notification
G dated 6.6.2008 under Section 23-A(1 )(a) of the Act proposing
change of land use in respect of 19.75 acres land of Khasra
No.82/1 (part) of Village Bawadiya Kalan from public and semi-
public (health) to public and semi public and invited objections/
suggestions. The notification was published in the Official
Gazette and two newspapers, namely, "Dainik Bhaskar" and
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 103
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.)
"Sandhya Prakash" dated 9th and 10th June, 2008. Five A
persons representing Bawadiya Uthaan Samiti, "Sangwari" -
Society for the Resource Companion, Koshish Society, Neeraj
Housing Society, Satpura Vigyan Sabha and Swadesh
Developers and Colonizers filed their objections against the
proposed change of land use. They were given opportunity of B
hearing by Deputy Secretary, Housing and Environment
Department, who opined that the objections were untenable.
Her recommendation was approved by the Secretary, Housing
and Environment Department and the concerned Minister.
Thereafter, final notification dated 5.9.2008 was issued under c
Section 23-A(2) of the Act.
4. The appellant, who is engaged in public welfare
activities in general and consumers welfare in particular and
claims to have received awards for good and meritorious
performance including Swami Vivekananda Award challenged D
the allotment of land to respondent No.5 in Writ Petition
No.10617 of 2007, on the grounds of violation of Article 14 of
the Constitution and arbitrary exercise of power. The Division
Bench of the High Court summarily dismissed the Writ Petition
by observing that land belongs to the Government and it is for E
the Government to decide whom the same should be allotted
as per its policy and no case of violation of any legal or
constitutional right has been made out by the petitioner.
5. In response to the notice issued by this Court, counter F
dated 23.3.2010 was filed on behalf of respondent Nos.1 to 4
with an affidavit of Shri Kishore Kanya!, Nazul Officer/SDO, T.T.
Nagar, Bhopal. After the arguments were heard on 3.1.2011,
additional affidavit dated 10.1.2011 was filed by Shri
Umashankar Bhargav, Nazul Officer, Bhopal giving the details G
of various proceedings which culminated in the allotment of land
to the Memorial Trust, subsequent change in the name of the
allottee and change of land use under Section 23-A. Along with
his affidavit, Shri Umashankar Bhargav enclosed list showing
allotment of land to various institutions, organizations and
H
104 SUPREME COURT REPORTS [2011] 5 S.C.R.
A individuals and copy of order dated 28.10.2009 passed by the
Division Bench of the High Court in Writ Petition No.4088 of
2009. In paragraph 13 of his affidavit, the deponent made a
categorical statement that neither the petitioner nor any member
of the public submitted any objection against the proposed
B change of land use.
On 13.1.2011, the Court directed the State Government
to file an affidavit to show as to how many allotments have been
made at an yearly rent of Re. 1/-. Thereupon, Shri Anil
Srivastava, Principal Secretary, Revenue Department,
C Government of Madhya Pradesh filed an affidavit along with list
of 69 institutions and organizations to whom land was allotted
at an annual rent of Re. 1 only without charging any premium.
After the arguments were concluded, another affidavit of
D Shri Umashankar Bhargav was filed on 18.1.2011. He tendered
apology for making a wrong statement in paragraph 13 of
affidavit dated 10.1.2011 and filed copies of the following
documents:
E i) Application dated 18.09.2007 made by Shri Kailash
Joshi for erection of building in Khasra No. 82/1, Bawadiya
Kalan;
ii) Letter dated 04.02.2008 sent by respondent No.3 to the
Principal Secretary, Housing, proposing change of land use of
F Khasra No.82/1 (part) from public and semi public (health) and
road to public and semi public and road;
iii) Paper publications dated 09.06.2008 and 10.06.2008;
iv) Notice dated 04.08.2008 issued to the objectors;
G
v) Note-sheets dated 01.09.2009 and 02.09.2009 of the
Housing and Environment Department;
vi) Letter dated 13.09.2006 sent by respondent No.4 to the
H Principal Secretary, Housing, letter dated 06.10.2006 issued
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 105
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
by the State Government for amending memo dated A
25.09.2004 and letter dated 02.11.2006 sent by the State
Government to respondent No.4 for amendment of orders dated
27.01.2006 and 19.06.2006.
Learned counsel for the appellants also placed on record B
xerox copy of the cover page of Writ Petition No. 933 of 2005
filed by the appellant by way of public interest litigation
challenging the allotment of land, which was reserved for park,
lawn, parking and open spaces by Madhya Pradesh Housing
Board to Punjabi Samaj, Bhopal as also copy of the interim C
order passed by the High Court whereby the allottee was
· restrained from raising further construction.
Arguments:
6. Shri Raju Ramchandran, learned senior counsel for the o
appellant, criticized tile impugned order and argued that the ...
High Court committed serious error by summarily dismissing
the writ petition without examining and adjudicating the
important questions of law relating to violation of Article 14 of
the Constitution and the provisions of the Act and the Rules. E
Learned senior. counsel submitted that the exercise undertaken
by the State Government for reservation of land and allotment
of a portion thereof to respondent No.5 without any
advertisement and without adopting a procedure consistent
with the doctrine of equality enshrined in Article 14 of the
Constitution c:nd waiver of a substantial portion of the premium F
are acts of gross favoritism and, therefore, the allotment in
question should be declared as nullity. Shri Ramchandran then
argued that the notifications issued by the State Government
for change of land use are liable to be quashed because the
same are ultra vires the provisions of Section 23A(1) and (2) G
of the Act. Learned senior counsel referred to notification dated
06.06.2008 to show that the same did not contemplate
modification of Bhopal Development Plan for any proposed
project of the Government of India or the State Government and
H
106 SUPREME COURT REPORTS [2011] 5 S.C.R.
A its enterprise or for any proposed project relevant to
development of the State or for implementing a scheme framed
by the Town and Country Development Authority (for short 'the
Authority') and argued that the development plan cannot be
modified under Section 23A(1) for the benefit of a private
B individual, or group of persons or organization or institution.
Learned senior counsel submitted that the notice issued under
Section 23A(2) was incomplete inasmuch as the draft modified
plan was not published so as to enable the members of public
to effectively oppose the proposed modification of the
c development plan. In the end, Shri Ramchandran argued that
the decision of the State Government to indirectly reserve the
land in favour of Respondent No.5 with retrospective effect is
liable to be quashed because as on the date of reservation the
said respondent had not been registered as a trust.
D 7. Shri Ravi Shanker Prasad, learned senior counsel
appearing for the State of Madhya Pradesh and other official
respondents, challenged the locus standi of the appellant on the
premise that the averments contained in the writ petition were
vague to the core and the High Court rightly refused to entertain
E the same as a petition filed in public interest. Learned senior
counsel then referred to the provisions of the Act, the Madhya
Pradesh Government Rules of Business, the RBC and argued
that the impugned allotment cannot be termed as arbitrary or
vitiated due to violation of Article 14 because the State
F Government has a long standing policy of allotting land to social,
cultural, religious, educational and other similar organizations/
institutions without issuing advertisement or inviting applications
from the public. In support of this argument, learned senior
counsel referred to the list of the allottees annexed with affidavit
G dated 10.1.2011 of Shri Umashankar Bhargav. Learned senior
counsel relied upon the judgments of this Court in Ugar Sugar
Works Ltd. v. Delhi Administration (2001) 3 SCC 635, State
of UP. v. Chaudhary Ram Beer Singh (2005) 8 SCC 550,
State of Orissa v. Gopinath Dash (2005) 13 SCC 495 and
H Meerut Development Authority v. Association of Management
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 107
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
Studies' (2009) 6 sec 171 and argued that the Court cannot A
exercise the power of judicial review to nullify the policy framed
by the State Government to allot Nazul land without
advertisement. Shri Ravi Shanker Prasad referred to paragraph
26 of the RBC and argued that the State Government is
possessed with the power to make allotment without charging 8
premium or waive the same. Learned senior counsel then relied
upon a passage from Chapter IV of the Law of Trusts and
Charities by Atul M Setalvad, judgments of this Court in State
of Uttar Pradesh v. Bansi Dhar (1974) 1 SCC 447 and
Canbank Financial Services Ltd. v. Custodian (2004) 8 SCC C
355 and argued that intention to create a trust was sufficient
for making an application for reservation and allotment of land
in favour of respondent No.5. He submitted that while making
request for reservation of land in favour of the Memorial Trust,
Shir Kailash Joshi had made it clear that the same will be used
for establishing a training institute in the name of late Shri D
Khushabhau Thakre and this was a clear indication to the State
Government that a trust will be created for managing the
institute.
8. Shri Ranjit Kumar, learned senior counsel appearing for E
respondent No.5, submitted that this Court should not interfere
with the impugned allotment because at every stage of the
proceedings i.e. reservation of land, formation of trust and
change of land use, objections were invited from public but at
no stage the appellant had filed any objection. The learned F
counsel extensively referred to the RSC, the provisions of the
Act and Madhya Pradesh Nagar Tatha Gram Nivesh Viksit
Bhoomiyo, Griho, Shavano Tatha Anya Sanrachanao Ka
Vyayan Niyam, 1975 (for short 'the Rules') and argued that the
allotment of land to respondent No.5 and change of land use G
are not vitiated due to violation of any constitutional or legal
principle warranting interference by the Court. Shri Ranjit Kumar
relied upon Sections 3,5 and 6 of the Indian Trusts Act, 1882
and Sections 2,4,5,6,8, 11,32 and 33 of the 1951 Act and
argued that intention to create trust was sufficient to enable Shri
H
108 SUPREME COURT REPORTS [2011] 5 S.C.R.
A Kailash Joshi to make applications for reservation and allotment
of land in the name of the institute and, in any case, the
appellant cannot take advantage of non-registration of the trust
up to 6.10.2004 because on the date of actual allotment i.e.
27.01.2006 the trust stood registered. Learned senior counsel
8 also emphasized that once the trust was registered, the factum
of registration will relate back to the date of application i.e.
31.07.2004, which was prior to the reservation of land by the
State Government. In the end, Shri Ranjit Kumar submitted that
the Court may not nullify the impugned allotment at the instance
C of the appellant because it did not question hundreds of similar
allotments made in favour of other organizations/institutions.
Learned senior counsel also relied upon the judgment of this
Court in Harsh Dhingra v. State of Haryana (2001) 9 SCC 550
and argued that the impugned allotment may not be quashed
and the law which may be laid down by this Court should govern
D the allotments, which may be made in future.
9. We have considered the respective submissions. For
deciding the questions arising in the appeal, it will be useful to
notice the relevant provisions of the Act, the Rules and the
E RSC.
10. The Act was enacted to make provisions for planning
and development and use of land; to make better provisions
for the preparation of development plans and zoning plans with
F a view to ensure that town planning schemes are made in a
proper manner and they are effectively executed. The Act also
provides for constitution of Town and Development Authority for
proper implementation of Town and Country Development Plan
and for the development and administration of special areas
through Special Area Development Authority and also to make
G provisions for the compulsory acquisition of land required for
the purpose of the development plans and for achieving the
objects of the Act. Chapter IV of the Act (Sections 13 to 19)
contains provisions relating to planning areas and development
plans. Under Section 13(1 ), the State Government is
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 109
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
empowered to constitute planning areas for the purposes of the A
Act and define limits thereof. In terms of Section 13 (2), the
State Government can alter the limits of the planning area,
amalgamate two or more planning areas, divide any planning
area into two or more planning areas and also declare that
whole or part of the area constituting the planning area shall B
cease to be so. Section 14 casts a duty on the Director of Town
and Country Planning to prepare an existing land use map, a
development plan and do other activities specified in clauses
(d) and (e) of that section. Section 15 contains the procedure
for preparation of existing land use map. Section 16 lays down c
that after publication of the existing land use map under Section
15 no person shall change the use of any land or carry out any
development of land for any purpose other than those indicated
in the existing land use map without prior permission of the
Director. It also lays down that no local authority or any officer D
or other authority shall grant permission for change in use of
land in violation of the existing land use map. Section 17 (as
amended by M.P. Act No. 8 of 1996) lays down that a
development plan shall take into account any draft five-year and
Annual Development plan of the district prepared under the E
Madhya Pradesh Zila Yojana Samiti Adhiniyam, 1995 in
respect of the planning area and shall broadly indicate the land
use proposed in the planning area; allocate broadly areas or
zones of land, keeping in view the regulations of natural hazard
prone areas, for residential, industrial, commercial or
agricultural purposes; open spaces, parks and gardens, green- F
belts, zoological gardens and playgrounds; public institutions
and offices and such special purposes as the Director may
consider proper. Other factors enumerated in clauses (c) to (j)
are also required to be taken into consideration while preparing
a development plan. Section 17-A(1) mandates the constitution G
of a Committee consisting of various persons specified in
clauses (a) to (i) thereof. The role of the Committee is to hear
the objections received after publication of the draft
development plan under Section 18 and suggest modifications
or alterations, if any. Section 18 provides for publication of the H
110 SUPREME COURT REPORTS [2011) 5 S.C.R.
A draft development plan for inviting objections and suggestions
from public. The objections and suggestions, if any, received
are required to be placed before the Committee constituted
under Section 17-A(1) which shall, after giving opportunity of
hearing to the affected persons, suggest appropriate
B modifications in the draft development plan. After receiving the
report of the Committee, the Director is required to submit the
development plan for approval of the Government. Section 19
provides for approval of the development plan with or without
modifications by the State Government. In a given case the
c State Government can return the development plan with a
direction that fresh development plan be prepared. Where the
State Government approves the development plan with
modification, a notice is required to be published in the Gazette
inviting objections and suggestions in respect of such
modification and final plan is to be published after considering
0
the objections and suggestions, if any, received and giving
opportunity of hearing to those desirous of being heard. In terms
of sub-section (5) of Section 19 the development plan comes
into operation from the date of publication of the notice in the
Gazette. Chapter V deals with zoning plan. Section 20 lays
E down that the local authority may, on its own motion, prepare a
zoning plan after publication of the development plan. If the
State Government sends a requisition for that purpose then also
the local authority is required to prepare a zoning plan. Section
21 specifies the matters which are to be incorporated in the
F zoning plan. By virtue of Section 22, the provisions of Sections
18 and 19 have been made applicable for the purpose of
preparation, publication, approval and operation of zoning plan.
Section 23(1) empowers the Director to undertake a review and
evaluation of the development plan either on his own motion
G or in terms of the directions given by the State Government.
Likewise, under Section 23(4) the local authority can undertake
review and evaluation of the zoning plan on its own motion or
as per the direction of the State Government or the Director.
Section 23-A was inserted in the Act by M.P. Act 22 of 1992
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 111
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
and was substituted by M.P. Act 22 of 2005. In terms of Section A
24(1 ), the overall control of development and use of land in the
State vests in the State Government. Section.24(2) lays down
that subject to the control of the State Government under sub-
section (1) and the rules made under the Act, the overall control
of development and use of land in the planning area shall vest B
in the Director from the date appointed by the State
Government by notification. Sub-section (3) empowers the
State Government to make rules to regulate control of
development and use of land in planning area. Section 25(1}
lays down that after coming into force of the development plan, C
the use and development of land shall be in accordance with
the development plan. Section 26 lays down that after coming
into operation of the development plan, no person shall change
the use of any land or carry out any development without written
permission of the Director. Proviso to this section contains D
some exceptions in which works can be carried out without
prior permission of the Director. Chapter VII (Sections 38 to
63A) provides for establishment of Town and Country
Development Authority and its status as a body corporate,
constitution of the Authority, tenure and remuneration etc. of E
Chairman and Vice Chairman, appointment of Chief Executive
Officer and other officers and servants. Section 49 specifies
the factors which may be included in a town development
scheme. Section 50 regulates preparation of a town
development scheme and publication thereof in the Gazette F
etc. Section 58 empowers the authority to make regulation for
disposal of developed lands, houses, buildings and other
structures. This is subject to the rules which may be made by
the State Government in this behalf. Section 85, which finds
place in Chapter XI, confers power upon the State Government G
to make rules for carrying out the purposes of the Acts. For the
sake of reference, Sections 14(a), (b}, 15, 17(a), (b), 23-A,
25(1 ), 26 and 58 of the Act are reproduced below:
"14. Director to prepare development plans. -Subject
to the provisions of this Act and the rules made thereunder, H
112 SUPREME COURT REPORTS [2011] 5 S.C.R
A the Director shall, -
(a) prepare an existing land use map;
(b) prepare a development plan;
8 15. Existing land use maps -
(1) The Director shall carry out the survey and prepare an
existing land use map indicating the natural hazard prone
areas] and, forthwith publish the same in such manner as
may be prescribed together with public notice of the
c preparation of the map and of place or places where the
copies may be inspected, inviting objections and
suggestions in writing from any person, with respect
thereto within thirty days from the date of publication of such
notice.
D
(2) After the expiry of the period specified in the notice
published under sub-section (1), the Director may, after
allowing a reasonable opportunity of being heard to all such
persons who have filed the objections or suggestions,
E make such modifications therein as may be considered
desirable.
(3) As soon as may be after the map is adopted with or
without modifications the Director shall publish a public
notice of the adoption of the map and the place or places
F
where the copies of the same may be inspected.
(4) A copy of the notice shall also be published in the
Gazette and it shall be conclusive evidence of the fact that
the map has been duly prepared and adopted.
G
17. Contents of development plan.- A development
plan shall take into account any draft five-year and Annual
Development plan of the district prepared under the
Madhya Pradesh Zila Yojana Samiti Adhiniyam, 1995 (No.
H 19 of 1995) in which the planning area is situated and shall,
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 113
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
(a) indicate broadly the land use proposed in the planning A
area;
(b) allocate broadly areas or zones of land, keeping in view
the regulations for natural hazard prone areas, for-
B
(i) residential, industrial, commercial or agricultural,
purpose;
(ii) open spaces, parks and gardens, green-belts,
zoological gardens and playgrounds;
c
(iii) public institutions and offices;
(iv) such special purposes as the Director may deem fit;
23-A. Modification of Development Plan or zoning
Plan by State Government in certain circumstances.- D
(1 )(a) The State Government may, on its own motion or
on the request of a Town and Country Development
Authority, make modification in the development plan or
the zoning plan for any proposed project of the Government E
of India or the State Government and its enterprises or for
any proposed project related to development of the State
or for implementing a scheme of a· Town and Country
Development Authority and the modification so made in
the development plan or zoning plan shall be an integral
part of the revised development plan or zoning plan.
F
(b) The State Government may, on an application from any
person or an association of persons for modification of
development plan or zoning plan for the purpose of
undertaking an activity or scheme which is considered by G
the State Government or the Director, on the advice of the
Committee constituted by the State Government for this
purpose, to be beneficial to the society, make such
modification in the development plan or zoning plan as
may be deemed necessary in the circumstances of the H
114 SUPREME COURT REPORTS (2011] 5 S.C.R.
A case and the modification so made in the devaloprmmt
plan or zoning plan shall be an integral part of the revised
development plan or zoning plan.
(2) The State Government shall publish the draft of modified
plan together with a notice of the preparation of the draft
B
modified plan and the place or places where the copies
may be inspected, continuously for two days in such two
daily newspapers which are in the approved list of
Government for advertisement purpose having circulation
in the area to which it relates and a copy thereof shall be
c affixed in a conspicuous place in the office of the Collector,
inviting objections and suggestions in writing from any
person with respect thereto within fifteen days from the
date of publication of such notice.
D After considering all the objections and suggestions
as may be received within the period specified/in the
notice and shall, after giving reasonable opportunity to all
persons affected thereby of being heard, the State
Government shall confirm the modified plan.
E
(3) The provisions of Sections 18, 19 and 22 shall not
apply for modification made by the State Government."
25. Conformity with development plan. -(1) After the
coming into force of the development plan, the use and
F development of land shall conform to the provisions of the
development plan:
[Provided that the [Director] may, as its discretion, permit
the continued use of land for the purpose for which it was
being used at the time of the coming into operation of the
G
development plan:]
Provided further than such permission shall not be granted
for a period exceeding seven years from the date of
coming into operation of the development plan.
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 115
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
26. Prohibition of development without permission.- A
After the coming into operation of the development plan,
no person shall change the use of any land or carry out any
development of land without the permission in writing of
the Director.
B
Provided that no such permission shall be necessary,-
(a)for carrying out works for the maintenance, repair or
alteration of any building which does not materially alter the
external appearance of the building;
c
(b)for carrying out of work for the improvement or
maintenance of a highway, road or public street by the
Union or State Government or an authority established
under this Act or by a local authority having jurisdiction,
provided that such maintenance or improvement does not D
change the road alignment contrary to the provisions of the
development plan;
(c)for the purpose of inspecting, repairing or renewing any
drains, sewers, mains, pipes, cables, telephone or other
apparatus including the breaking open of any street or E
other land for that purpose;
(d) for the excavation or soil-shaping in the interest of
agriculture;
F
(e) for restoration of land to its normal use where land has
been used temporarily for any other purposes;
(f) for use, for any purpose incidental to the use of building
for human habitation, or any other building or land attached
to such building; G
(g) for the construction of a road intended to give access
to land solely for agricultural purposes:
[Provided further that in a planning area to which rules H
made under sub-section (3) of Section 24 are made
116 SUPREME COURT REPORTS [2011] 5 S.C.R.
A applicable, such permission may be given by such authority
as may be provided in the said rules.]
58. Disposal of land, buildings and other
development works.- Subject to such rules as may be
made by the State Government in this behalf, the Town and
B
Country Development Authority shall, by regulation,
determine the procedure for the disposal of developed
lands, houses, buildings and other structures."
11. In exercise of the powers conferred upon it under
C Section 58 read with Section 85, the State Government framed
the Rules. Rule 3 declares that no Government land vested in
or managed by the Authority shall be transferred except with
the general or special sanction of the State Government. Rule
4 lays down that all other land i.e. "the Authority Land" shall be
D transferred in accordance with the following rules. Rule 5
prescribes four modes of transfer of the Authority land. These
are:
(a) By direct negotiations with the party; or
E (b) By public auction; or
(c) By inviting tenders; or
(d) Under Concessional terms."
F Rules 5-A to 27 enumerate the steps required to be taken
for transfer of land by different modes. Rule 28 lays down that
transfer of the Authority land under Rule 27 shall be made on
such terms and conditions as may be fixed by the Authority.
Rules 29 to 48 provide for matters ancillary to the transfer of
G the Authority land i.e. execution of lease, payment of rent by the
transferee etc.
12. What is significant to be noted is that there is no
provision in the Act or the Rules for disposal and/or transfer of
H land in respect of which a regional plan or development plan
•
AKHIL BHART:IYA UPBHOKTA CONGRESS v. STATE 117
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
or zonal plan has been prepared. The only provision which has A
nexus with the Government land is contained in Rule 3 which,
-as mentioned above, imposes a bar against the transfer of
Government land vested in or managed by the Authority except
with the general or special sanction of the State Government.
B
13. We may now notice the relevant provisions of the RBC
some of which have been relied upon by the learned senior
counsel appearing for the respondents to justify the reservation
and allotment of land in favour of respondent No. 5. Part IV of
the RBC deals with the management and regulation of Nazul
land falling within the limits of municipal corporations, municipal C
councils and notified areas; and transfer thereof by lease, sale
etc. Paragraph 12 of this part lays down that Nazul land can
be disposed of by way of permanent lease, temporary lease,
on Bedawa karar, annual licence and also by transfer to the
State Administration _and department of any other State D
Government or Government of India or by vesting in any local
authority. In terms of paragraph 13(1 ), permanent lease can be
granted either by auction or without auction. Paragraph 13(2)
enumerates the contingencies in which permanent lease cannot
be granted by auction. These include when the land in question E
is used for religious, educational, co-operative, public or social
purposes. Paragraph 14 provides for reservation of the plots
which are sold with the approval of the State Government on
the conditions separately decided for each such plot.
Paragraph 17 specifies the authorities who are competent to F
pass orders in respect of Nazul land. Under this paragraph, the
power to grant lease of Nazul land for educational institutions,
playgrounds, hospitals and other public purposes on
concessional rate as also the power to grant lease of Nazul land
for 30 years or less with a right of renewal vests with the State G
Government, if the mode of disposal is otherwise than auction.
The residuary power also vests with the State Government.
Paragraph 18 lays down that a petition can be submitted to the
higher authority against any order which may be passed by an
officer subordinate to the State Government. Paragraph 19 H
118 SUPREME COURT REPORTS [2011] 5 S.C.R.
A lays down that every application for permanent lease of Nazul
land should be made to the District Collector along with the
relevant documents, maps etc. Under paragraph 20, the
Collector is empowered to reject the application by recording
reasons. If the application is not rejected then the Collector has
B to adopt the procedure specified in clauses (a), (b), (c), (d), (e)
and (f) of this paragraph. If the plot of land is to be i;old by
auction then the same is required to be advertised or publicized
by a recognized method. Paragraph 21 prescribes the mode
of auction of lease rights. Any persons, desirous of participating
c in the auction is required to deposit 10 per cent of the premium.
Once the bid is approved by the competent authority, the bidder
has to deposit the balance amount within 30 days. This
paragraph also provides for forfeiture of the premium and
recovery of the amount from the defaulter. Paragraph 23
specifies the minimum premium for different categories c1f plots.
0
Paragraph 24 lays down the procedure to be followed for
disposal of plot without auction. If any plot is proposed to be
transferred at a concessional premium then the approval of the
State Government is sine qua non. In case, the Collector is
E satisfied that the plot of land should be given without auction
then the allottee is required to pay premium equivalent to
average market price determined on the basis of the sale
instances of last five years. In terms of paragraph 25, the
Collector is required to submit report to the Commissioner or
to the Government through the Commissioner after scrutiny of
F the matter at different stages. Paragraph 26 lays down that when
Nazul land is allotted to non-government organisations or
persons on favourable terms then the conditions specified
therein should be scrupulously observed and there should be
rigorous scrutiny of the proposal. Under this paragraph, land
G can be allotted to educational, cultural and philanthropic
institutions/organisations or Cooperative Societies, Housing
Board and Special Area Authority constituted by the State
Government. However, unregistered societies and private trt1Sts
are not eligible for allotment of land. This paragraph also
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 119
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
contemplates allotment of land for religious purposes or to Jain A
Temple, Mosque, Church, Gurdwara etc. provided that there is
no similar place within two kilometers of the site proposed to
be allotted. Clause 1(a) and (b) of this paragraph prescribes
the premium required to be paid by different types of bodies
and institutions. Clause 3 prescribes. the condition relating to B
construction of the building and Clause 5 provides for
resumption of land in certain eventualities. By Circular No.6/16/
91/Sat/SN2B, the Government prescribed the revised rates for
allotment of Nazul land to caste and non-caste based social,
religious and philanthropic organizations, the organizations c
engaged in welfare of women, educational and cultural
organizations, public hospitals, co-operative societies,
agriculture market committee, municipal corporation etc. By
Circular No. F.6-173/96/Sat/SN2B/f',Jazul dated 31.5.1996, the
State Government prescribed the premium and rent to be D
charged for allotment of land to caste based and social
institutions. By Circular No. F No. 6-140/07/SAT/Nazul dated
31.8.2007, the State Government decided to allot land without
charging any premium at an annual rent of Re. 1/- for housing
schemes meant for slum dwellers.
E
14. We shall now consider whether the State Government
could allot 20 acres of land to ;·espondent No.5 without issuing
an advertisement or adopting a procedure consistent with the
doctrine of equality so as to enable other similar organizations/
institutions to participate in the process of allotment. F
15. The concept of 'State' has changed in recent years. In
all democratic dispensations the State has assumed the role
of a regulator and provider of different kinds of services and
benefits to the people like jobs, contracts, licences, plots of land, G
mineral rights and social security benefits. In his work "The
Modern State" Maciver (1964 Paperback Edition) advocated
that the State should be viewed mainly as a service corporation.
He highlighted difference in perception about the theory of State
in the following words:
H
120 SUPREME COURT REPORTS [2011] 5 S.C.R.
A "To some people State is essentially a class-structure, "an
organization of one class dominating over the other
classes"; others regard it as an organisation that
transcends all classes and stands for the whole
community. They regard it as a power-system. Some view
B it entirely as a legal structure, either in the old Austinian
sense which made it a relationship of governors and
governed, or, in the language of modern jurisprudence, as
a community "organised for action under legal rules". Some
regard it as no more than a mutual insurance society,
c others as the very texture of all our life. Some class the
State as a great "corporation" and others consider it as
indistinguishable from society itself."
16. When the Constitution was adopted, people of India
resolved to constitute India into a Sovereign Democratic
D Republic. The words 'Socialist' and 'Secular' were added by
the Constitution (Forty-second Amendment) Act, 1976 and also
to secure to all its citizens Justice - social, economic and
political, Liberty of thought, expression, belief, faith and worship;
Equality of status and/or opportunity and to promote among
E them all Fraternity assuring the dignity of the individual and the
unity and integrity of the Nation. The expression 'unity of the
Nation' was also added by the Constitution (Forty-second
Amendment) Act, 1976. The idea of welfare State is ingrained
in the Preamble of the Constitution. Part Ill of the Constitution
F enumerates fundamental rights, many of which are akin to the
basic rights of every human being. This part also contains
various positive and negative mandates which are necessary
for ensuring protection of the Fundamental Rights and making
them real and meaningful. Part IV contains 'Directive Principles
G of State Policy' which are fundamental in the governance of the
country and it is the duty of the State to apply these principles
in making laws. Article 39 specifies certain principles of policy
which are required to be followed by the State. Clause (b)
thereof provides that the State shall, in particular, direct its policy
H towards securing that the ownership and control of the material
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 121
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
resources of the community are so distributed as best to sub- A
serve the common good. Parliament and Legislatures of the
States have enacted several laws and the governments have,
from time to time, framed policies so that the national wealth
and natural resources are equitably distributed among all
sections of people so that have-nots of the society can aspire B
to compete with haves.
17. The role of the Government as provider of services and
benefits to the people was noticed in R.D. Shetty v.
International Airport Authority of India (1979) 3 SCC 489 in C
the following words:
'Today the Government in a welfare State, is the regulator
and dispenser of special services and provider of a large
number of benefits, including jobs, contracts, licences,
quotas, mineral rights, etc. The Government pours forth D
wealth, money, benefits, services, contracts, quotas and
licences. The valuables dispensed by Government take
many forms, but they all share one characteristic. They are
steadily taking the place of traditional forms of wealth.
These valuables which derive from relationships to E
Government are of many kinds. They comprise social
security benefits, cash grants for political sufferers and the
whole scheme of State and local welfare. Then again,
thousands of people are employed in the State and the
Central Governments and local authorities. Licences are F
required before one can engage in many kinds of
businesses or work. The power of giving licences means
power to withhold them and this gives control to the
Government or to the agents of Government on the lives
of many people. Many individuals and many more G
businesses enjoy largesse in the form of Government
contracts. These contracts often resemble subsidies. It is
virtually impossible to lose money on them and many
enterprises are set up primarily to· do business with
'Government. Government owns and controls hundreds of
H
122 SUPREME COURT REPORTS [2011] 5 S.C.R.
A acres of public land valuable for mining and other
purposes. These resources are available for utilisation by
private corporations and individuals by way of lease or
licence. All these mean growth in the Government largesse
and with the increasing magnitude and range of
B governmental functions as we move closer to a welfare
State, more and more of our wealth consists of these new
forms. Some of these forms of wealth may be in the nature
of legal rights but the large majority of them are in the nature
of privileges .......... "
c 18. For achieving the goals of Justice and Equality set out
in the Preamble, the· State and its agencies/instrumentalities
have to function through political entities and officers/officials
at different ;~wels. The laws enacted by Parliament and State
Legislatures bestow upon them powers for effective
D implementation of the laws enacted for creation of an
egalitarian society. The exercise of power by political entities
and officers/officials for providing different kinds of services and
benefits to the people always has an element of discretion,
which is required to be used in larger public interest and for
E public good. In principle, no exception can be taken to the use
of discretion by the political functionaries and officers of the
State and/or its agencies/instrumentalities provided that this is
done in a rational and judicious manner without any
discrimination against anyone. In our constitutional structure, no
F functionary of the State or public authority has an absolute or
unfettered discretion. The very idea of unfettered discretion is
totally incompatible with the doctrine of equality enshrined in the
Constitution and is an antithesis to the concept of rule of law.
G 19. In his work 'Administrative Law' (6th) Edition, Prof.
H.W.R. Wade, highlighted distinction between powers of public
authorities and those of private persons in the following words:
" ... The common theme of all the authorities so far
mentioned is that the notion of absolute or unfettered
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 123
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
discretion is rejected. Statutory power conferred for public A
purposes is conferred as it were upon trust, no cibsolutely
- that is to say, it can validly be used only in the right and
proper way which Parliament when conferring it is
presumed to have intended. Although the Crown's lawyers
have argued in numerous cases that unrestricted B
permissive language confers unfettered discretion, the truth
is that, in a system based on the rule of law, unfettered
governmental discretion is a contradiction in terms."
Prof. Wade went on to say:
c
" ...... The whole conception of unfettered discretion is
inappropriate to a public authority, which possesses
powers solely in order that it may use them for the public
good.
D
There is nothing paradoxical in the imposition of such legal
limits. It would indeed be paradoxical if they were not
imposed. Nor is this principle an oddity of British or
American law; it is equally prominent in French law. Nor
is it a special restriction which fetters only local authorities:
E
it applies no less to ministers of the Crown. Nor is it
confined to the sphere of administration: it operates
wherever discretion is given for some public purpose, for
example where a judge has a discretion to order jury trial.
It is only where powers are given for the personal benefit
of the person empowered that the discretion is absolute.
F
Plainly this can have no application in public law.
For the same reasons there should in principle be no such
thing as unreviewable administrative discretion, which
should be just as much a contradiction in terms as G
unfettered discretion. The question which has to be asked
is what is the scope of judicial review, and in a few special
cases the scope for the review of discretionary decisions
may be minimal. It remains axiomatic that all discretion is
H
124 SUPREME COURT REPORTS [2011] 5 S.C.R.
A capable of abuse, and that legal limits to every power are
to be found somewhere."
(emphasis supplied)
20. Padfield v. Minister of Agriculture, Fishery and Food
B (1968) A.C. 997, is an important decision in the area of
administrative law. In that cas9 the Minister had refused to
appoint a committee to investigate the-eomplaint made by the
members of the Milk Marketing Board that majority of the Board
had fixed milk prices in a way that was unduly unfavourable to
C the complainants. The Minister's decision was founded on the
reason that it would be politically embarrassing for him if he
decided not to implement the committee's decision. While
rejecting the theory of absolute discretion, Lord Reid observed:
D "Parliament must have conferred the discretion with the
intention that it should be used to promote the policy and
objects of the Act; the policy and objects of the Act must
be determined by construing the Act as a whole and
construdion is always a matter of law for the court. In a
matter of this kind it is not possible to draw a hard and
E
fast line, but if the Minister, by reason of his having
misconstrued the Act or for any other reasons, so uses his
discretion as to thwart or run counter to the policy and
objects of the Act, then our law would be very defective if
persons aggrieved were not entitled to the protection of
F the court."
21. In Breen v. Amalgamated Engineering Union (1971)
2 QB 175, Lord Denning MR said:
G "The discretion of a statutory body is never unfettered. It
is a discretion which is to be exercised according to law.
That means at least this: the statutory body must be guided
by relevant considerations and not by irrelevantly. It its
decision is influenced by extraneous considerations which
it ought not to have taken into account, then the decision
H
. .
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 125
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
cannot stand. No matter that the statutory body may have A
acted in good faith; nevertheless the decision will be set
aside. That is established by Padfield v. Minister of
Agriculture, Fisheries and Food which is a landmark in
modern administrative law."
8
22. In Laker Airways Ltd. v. Department of Trade 1977 QB
643, Lord Denning discussed prerogative of the Minister to
give directions to Civil Aviation Authorities overruling the
specific provisions in the statute in the time of war and said:
"Seeing that prerogative is a discretion power to be C
exercised for the public good, it follows that its exercise
can be examined by the Courts just as in other
discretionary power which is vested in the executive."
23. This Court has long ago discarded the theory of D
unfettered discretion. In S. G. Jaisinghani v. Union of India AIR
1967 SC 1427, Ramaswami, J. emphasised that absence of
arbitrary power is the foundation of a system governed by rule
of law and observed:
"In this context it is important to emphasize that the E
absence of arbitrary power is the first essential of the rule
of law upon which our whole constitutional system is
based. In a system governed by rule of law, discretion,
when conferred upon executive authorities, must be
confined within clearly defined limits. The rule of law from F
this point of view means that decisions should be made
by the application of known principles and rules and, in
general, such decisions should be predictable and the
citizen should know where he is. If a decision is taken
without any principle or without any rule it is unpredictable G
and such a decision is the antithesis of a decision taken
in accordance with the rule of law. (See Dicey-"Law of the
Constitution" - Tenth Edn., Introduction ex.). 'Law has
reached its finest moments', stated Douglas, J. in u·nited
States v. Underlick (1951 342 US 98:96 Law Ed 113), H
126 SUPREME COURT REPORTS ·[2011] 5 S.C.R.
A "when it has freed man from the unlimited discretion of
some ruler ..... Where discretion is absolute, man has
always sufferes:I'. It is in this sense that the rule of law
maybe said to be the sworn enemy of caprice. Discretion,
as Lord Mansfield stated it in classic terms in the case of
B John Wilkes (1770 98 ER 327),'means sound discretion
guided by law. It must be governed by rule, not humour it
must not be arbitrary, vague and fanciful"
24. In Ramana Dayaram Shetty v. International Airport
C Authority of India (supra). Bhagwati, J. referred to an article by
Prof. Reich "The New Property" which was published in 73 Yale
Law Journal. In the article, the learned author said, "that the
Government action be based on standard that are not arbitrary
or unauthorized." The learned Judge then quoted with approval
the following observations made by Mathew, J. (as he then was)
D in V. Punnen Thomas v. State of Kera/a AIR 1969 Ker. 81 (Full
Bench):
"The Government is not and should not be as free as an
individual in selecting recipients for its largesses. Whatever
E its activities, the Government is still the Government and
will be subject to the restraints inherent in its position in a
democratic society. A democratic Government cannot lay
down arbitrary and capricious standards for the choice of
persons with whom alone it will deal."
F Bhagwati, J. also noticed some of the observations made
by Ray, C.J. in Eursian Equipments and Chemicals Ltd. v.
State of West Bengal (1975) 1 SCC 70 who emphasized that
when the Government is trading with public the democratic form
of Government demands equality and absence of arbitrariness
G and discrimination in such transactions and held:
" .......... Tllis proposition would hold good in all cases of
dealing by the Government with the public, where the
interest sought to be protected is a privilege. It must,
H therefore, be taken to be the law that where the Government
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 127
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
is dealing with the public, whether by way of giving jobs or A
entering into contracts or issuing quotas or licences or
granting other forms of largesse, the Government cannot
act arbitrarily at its sweet will and, like a private individual,
deal with any person it pleases, but its action must be in
conformity with standard or norms which is not arbitrary, B
irrational or irrelevant. The power or discretion of the
Government in the matter of grant of largesse including
award of jobs, contracts, quotas, licences, etc. must be
confined and structured by rational, relevant and non-
discriminatory standard or norm and if the Government. c
departs from such standard or norm in any particular
case or cases, the action of the Government would be
liable to be struck down, unless it can 'be shown by the
Government that the departure was not arbitrary, but was
based on some valid principle which in itself was not 0
irrational, unreasonable or discriminatory."
(emphasis supplied)
25. In Kasturi Lal Lakshmi Reddy v. State of J And K
(1980) 4 SCC 1, Bhagwati J. speaking for the Court observed: E
"Where any governmental action fails to satisfy the test of
reasonableness and public interest discussed above and .
is found to be wanting in the quality of reasonableness or
lacking in the element of public interest, it would be liable
to be struck down as invalid. It must follow as a necessary
F
corollary from this proposition that the Government cannot
act in a manner which would benefit a private party at the
cost of the State; such an action would be both
unreasonable and contrary to public interest. The
Government, therefore, cannot, for example, give a G
contract or sell or lease out its property for a consideration
less than the highest that can be obtained for it, unless
of course there are other considerations which render it
reasonable and in public interest to do so. Such
H
128 SUPREME COURT REPORTS [2011] 5 S.C.R.
A considerations may be that some directive principle is
sought to be advanced or implemented or that the contract
or the property is given not with a view to earning revenue
but for the purpose of carrying out a welfare scheme for
the benefit of a particular group or section of people
B deserving it or that the person who has offered a higher
consideration is not otherwise fit to be given the contract
or the property. We have referred to these considerations
only illustratively, for there may be an infinite variety of
considerations which may have to be taken into account
c by the Government in formulating its policies and it is on
a total evaluation of various considerations which have
weighed with the Government in taking a particular action,
that the court would have to decide whether the action of
the Government is reasonable and in public interest. But
one basic principle which must guide the court in arriving
D
at its determination on this question is that there is always
a presumption that the governmental action is reasonable
and in public interest and it is for the party challenging its
validity to show that it is wanting in reasonableness or is
not informed with public interest. This burden is a heavy
E one and it has to be discharged to the satisfaction of the
court by proper and adequate material. The court cannot
lightly assume that the action taken by the Government is
unreasonable or without public interest because, as we
said above, there are a large number of policy
F considerations which must necessarily weigh with the
Government in taking action and therefore the court would
not strike down governmental action as invalid on this
ground, unless it is clearly satisfied that the action is
unreasonable or not in public interest. But where it Is so
G satisfied, it would be the plainest duty of the court under
the Constitution to invalidate the governmental action.
This is one of the most important functions of the court
and also one of the most essential for preservation of the
rule of law. It is imperative in a democracy governed by
H the rule of law that governmental action must be kept
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 129
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
within the limits of the law and if there is any A
transgression, the court must be ready to condemn it. It
is a matter of historical experience that there is a tendency
in every Government to assume more and more powers
and since it is not an uncommon phenomenon in some
countries that the legislative check is getting diluted, it is 8
left to the court as the only other reviewing authority under
the Constitution to be increasingly vigilant to ensure
observance with the rule of law and in this task, the court
must not flinch or falter. It may be pointed out that this ground
of invalidity, namely, that the governmental action is c
·unreasonable or lacking in the quality of public interest, is
different from that of mala tides though it may, in a given
case, furnish evidence of mala tides."
(emphasis supplied)
D
26. In Common Cause, A Registered Society v. Union
of/ndia (1996) 6 SCC 530 the two Judge Bench considered
the legality of discretionary powers exercised by the then
Minister of State for Petroleum and Natural Gas in the matter
of allotment of petrol pumps and gas agencies. While declaring E
that allotments made by the Minister were wholly arbitrary,
nepotistic and motivated by extraneous considerations the
Court said:
"The Government today - in a welfare State - provides
large number of benefits to the citizens. It distributes wealth
F
in the form of allotment of plots, houses, petrol pumps, gas
agencies, mineral leases, contracts, quotas and licences
etc. Government distributes largesses in various forms. A
Minister who is the executive head of the department
concerned distributes these benefits and largesses. He is G
elected by the people and is elevated to a position where
he holds a trust on behalf of the people. He has to deal
with the people's property in a fair and just manner. He
cannot commit breach of the trust reposed in him by the
people." H
130 SUPREME COURT REPORTS [2011] 5 S.C.R.
A 27. The Court also referred to the reasons recorded in the
orders passed by the Minister for award of dealership of petrol
pumps and gas agencies and observed:
"24 ........... While Article 14 permits a reasonable
classification having a rational nexus to the objective
B
sought to be achieved, it does not permit the power to pick
and choose arbitrarily out of several persons falling in the
same category. A transparent and objective criteria/
procedure has to be evolve<;! so that the choice among the
members belonging to the same class or category is
c based on reason, fair play and non-arbitrariness. It is
essential to lay down as a matter of policy as to how
preferences would be assigned between two persons
falling in the same category. If there are two eminent
sportsmen in distress and only one petrol pump is
D available, there should be clear, transparent and objective
criteria/procedure to indicate who out of the two is to be
preferred. Lack of transparency in the system promotes
nepotism and arbitrariness. It is absolutely essential that
the entire system should be transparent right from the
E stage of calling for the applications up to the stage of
passing the orders of allotment."
.28. In Shri/ekha Vidyarthi v. State of U.P. (1991) 1 SCC
212, the Court unequivocally rejected the argument based on
F the theory of absolute discretion of the administrative authorities
and immunity of their action from judicial review and observed:
" .... We have no doubt that the Constitution does not
envisage or permit unfairness or unreasonableness in
State actions in any sphere of its activity contrary to the
G professed ideals in the Preamble. In our opinion, it would
be alien to the Constitutional Scheme to accept the
argument of exclusion of Article 14 in contractual matters.
The scope and permissible grounds of judicial review in
such matters and the relief which may be available are
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 131
OF MADHYA PRADESH AND .ORS. [G.S. SINGHVI, J.]
different matters but that does not justify the view of its total ·A
· exclusion. This is more so when the modern trend is also
to examine the unreasonableness of a term in such
contracts where the bargaining power is unequal so that
these are not negotiated contracts but standard form
contracts between unequals............................. B
Even assuming that it is necessary to import the
concept of presence of some public element in a State
action to attract Article 14 and permit judicial review, we
have no hesitation in saying that the ultimate impact of all C
actions of the State or a public body being undoubtedly
on public interest, the requisite public element for this
purpose is present also in contractual matters. We,
therefore, find it difficult and unrealistic to exclude the State
actions in contractual matters, after the contract has been
made, from the purview of judicial review to test its validity D
on the anvil of Article 14.
It can no longer be doubted at this point of time that
Article of the Constitution of India applies also to matters
of governmental policy and if the policy or any action of the E
· Government, even in contractual matters, f9'1s to satisfy the
test of reasonableness, it would be unconstitutional. (See
Ramana Dayaram Sheffy v. The International Airport
Authority of India ((1979) 3 SCR 1014: AIR 1979 SC
1628] and Kasturi Lal Lakshmi Reddy v. State of Jammu F
and Kashmir ((1980) 3 SCR 1338: AIR 1980 SC 1992),
In Co/. A. S. Sangwan v. Union of India ((1980 (Supp)
SCC 559 : AIR 1981 SC 1545], while the discretion to
change the policy in exercise of the executive power, when
not trammelledly the statute or rule, was held to be wide, G
it was emphasised as imperative and implicit in Article 14
of the Constitution that a change in policy must be made
fairly and should not give the impression that it was so
done arbitrarily or by any ulterior criteria. The wide sweep
of Article 14 and the requirement of every State action
H
132 SUPREME COURT REPORTS (2011] 5 S.C.R.
A qualifying for its validity on this touch-stone, irrespective of
the field of activity of the State, has long been settled. Later
decisions of this Court have reinforced the foundation of
this tenet and it would be sufficient to refer only to two
recent decisions of this Court for this purpose."
B
29. Similarly, in L.l.C. of India v. Consumer Education &
Research Centre (1995) 5 SCC 482, the Court negatived the
argument that exercise of executive power of the State was
immune from judicial review and observed:
c ".... Every action of the public authority or the person acting
in public interest or its acts give rise to public element,
should be guided by public interest. It is the exercise of
the public power or action hedged with public element
becomes open to challenge. If it is shown that the exercise
D of the power is arbitrary, unjust and unfair it should be no
answer for the State, its instrumentality, public authority or
person whose acts have the insignia of public element to
say that their actions are in the field of private law and they
are free to prescribe any conditions or limitations in their
E actions as private citizens, similicitor, do in the field of
private law. Its actions must be based on some rational
and relevant principles. It must not be guided by traditional
or irrelevant considerations ............ .
This Court has rejected the contention of an instrumentality
F or the State that its action is in the private law field and
would be immune from satisfying the tests laid under
Article 14. The dichotomy between public law and private
law rights and remedies, though may not be obliterated by
any straight jacket formula, it would depend upon the
G factual matrix. The adjudication of the dispute arising out
of a contract would, therefore, depend upon facts and
circumstances in a given case. The distinction between
public law remedy and private law filed cannot be
demarcated with precision. Each case will be examined
H on its facts and circumstances to find out the nature of the
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 133
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
activity, scope and nature of the controversy. The A
distinction between public law and private law remedy has
now become too thin and practicably obliterated .......
In the sphere of contractual relations the State, its
instrumentality, public authorities or those whose acts bear 8
insignia of public element, action to public duty or
obligation are enjoined to act in a manner i.e. fair, just and
equitable, after taking objectively all the relevant options
into consideration and in a manner that is reasonable,
relevant and germane to effectuate the purpose for public C
good and in general public interest and it must not take
any irrelevant or irrational factors into consideration or
arbitrary in its decision. Duty to act fairly is 'part of fair
procedure envisaged under Articles 14 and 21. Every
activity of the public authority or those under public duty or
obligation must be informed by reason and guided by the D
public interest."
30. In New India Public School v. HUDA (1996) 5 SCC
510, this Court approved the judgment of the Division Bench
of the Punjab and Haryana High Court in Seven Seas E
Educational Society v. HUDA AIR 1996 (P&H) 229 : (1996)
113 PLR 17, whereby allotment of land in favour of the
appellants was quashed and observed:
".... A reading thereof, in particular Section 15(3) read with
Regulation 3(c) does indicate that there are several modes
F
of disposal of the property acquired by HUDA for public
purpose. One of the modes of transfer of property as
indicated in Sub-section (3) of Section 15 read with sub-
regulation (c) of Regulation 5 is public auction, allotment
or otherwise. When public authority discharges its public G
duty the word "otherwise" would be construed to be
consistent with the public purpose and clear and
unequivocal guidelines or rules are necessary and not at
the whim and fancy of the public authorities or under their
garb or cloak for any extraneous consideration. It would H
I
134 SUPREME COURT REPORTS [2011] 5 S.C.R.
A depend upon the nature of the scheme and object of public
purpose sought to be achieved. In all cases relevant
criterion should be pre-determined by specific rules or
regulations and published for the public. Therefore, the
public authorities are required to make necessary specific
B regulations or valid guidelines to exercise their
discretionary powers, otherwise, the salutory procedure
would be by public auction. The Division Bench, therefore,
has rightly pointed out that in the absence of such statutory
regulations exercise of discretionary power to allot sites
c to private institutions or persons was not correct in law."
31. What needs to be emphasized is that the State and/
or its agencies/instrumentalities cannot give largesse to any
person according to the sweet will and whims of the political
entities and/or officers of the State. Every action/decision of the
D State and/or its agencies/instrumentalities to give largesse or
confer benefit must be founded on a sound, transparent,
discernible and well defined policy, which shall be made known
to the public by publication in the Official Gazette and other
recognized modes of publicity and such policy must be
E implemented/executed by adopting a non-discriminatory and
non-arbitrary method irrespective of the class or category of
persons proposed to be benefitted by the policy. The
distribution of largesse like allotment of land, grant of quota,
permit licence etc. by the State and its agencies/
F instrumentalities should always be done in a fair and equitable
manner and the element of favoritism or nepotism shall not
influence the exercise of discretion, if any, conferred upon the
particular functionary or officer of the State.
·I
32. We may add that there cannot be any policy, much
G less, a rational policy of allotting land on the basis of
applications made by individuals, bodies, organizations or
institutions de hors an invitation or advertisement by the State
or its agency/instrumentality. By entertaining applications made
by individuals, organisations or institutions for allotment of land
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 135
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
or for grant of any other type of largesse the State cannot A
exclude other eligible persons from lodging competing claim.
Any allotment of land or grant of other form of largesse by the
State or its agencies/instrumentalities by treating the exercise
as a private venture is liable to be treated as arbitrary,
discriminatory and an act of favoritism and/or nepotism violating' B
the soul of the equality clause embodied in Article 14 of the
Constitution.
33. This, however, does not mean that the State can never
allot land to the institutions/organisations engaged in
educational, cultural, social or philanthropic a<;:tivities or are C
rendering service to the Society except by way of auction.
Nevertheless, it is necessary to observe that once a piece of
land is earmarked or identified for allotment to institutions/
organisations engaged in any such activity, the actual exercise
of allotment must be done in a manner consistent with the D
doctrine of equality. The competent authority should, as a matter
of course, issue an advertisement incorporating therein the
conditions of eligibility so as to enable all similarly situated
eligible persons, institutions/organisations to participate in the
process of allotment, whether by way of auction or otherwise. E
In a given case the Government may allot land at a fixed price
but in that case also allotment must be preceded by a
wholesome exercise consistent with Article 14 of the
Constitution.
F
34. The allotment of land by the State or its agencies/
instrumentalities to a body/organization/institution which carry
the tag of caste, community or religion is not only contrary to
the idea of Secular Democratic Republic but is also fraught with
grave danger of dividing the society on caste or communal
lines. The allotment of land to such bodies/organisations/ G
institutions on political considerations or by way of favoritism
· -and/or nepotism or with a view to nurture the vote bank for future
is constitutionally impermissible.
35. We may now revert to the facts of this case. Admittedly, H
136 SUPREME COURT REPORTS [2011] 5 S.C.R.
A the application for reservation of land was made by Shrf Kailash
Joshi, in his capacity as convener of Memorial Trust. The
respondents have not placed on record any document to show
that on the date of application, the Memorial Trust was
registered as a public trust. During the course of hearing also
s no such document was produced before the Court. It is also
not in dispute that respondent No. 5 was registered as a public
trust only on 6.10.2004 i.e. after the order for reservation of land
in favour of the Memorial Trust was passed. The allotment was
also initially made in the name of trust, but, later on, the name
c of respondent No. 5 was substituted in place of the Memorial
Trust. The exercise for reservation of 30 acres land and
allotment of 20 acres was not preceded by any advertisement
in the newspaper or by any other recognized mode of publicity
inviting applications from organizations/institutions like the
Memorial Trust or respondent No.5 for allotment of land and
D everything was done by the political and non-political
functionaries of the State as if they were under a legal
obligation to allot land to the Memorial Trust and/or respondent
No.5. The advertisements issued by the State functionaries
were only for inviting objections against the proposed
E reservation and/or allotment of land in favour of the Memorial
Trust and not for participation in the process of allotment.
Therefore, it is not possible to accept the argument of Shri
Ranjit Kumar that land was allotted to respondent No.5 after
following a procedure consistent with Article 14 of the
F Constitution.
36. Although, the objectives of respondent No. 5 are
laudable and the institute proposed to be established by it is
likely to benefit an important segment of the society but the fact
G remains that all its trustees are members of a particular party
and the entire exercise for the reservation and allotment of land
and waiver of major portion of the premium was undertaken
because political functionaries of the State wanted to favour
respondent No. 5 and the officers of the State at different levels
H were forced to toe the line of their political masters.
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 137
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
37. At the cost of repetition, we consider it necessary to A
reiterate that there is no provision in the Act or the Rules and
even in the RSC for allotment of land without issuing
advertisement and/or without inviting applications from eligible
persons to participate in the process of allotment. lfthere would
have been such a provision in the Act or the Rules or the RBC B
the same could have been successfully challenged on the
ground of violation of Article 14 of the Constitution.
38. The argument of Shri Ravi Shanker Prasad that the
impugned allotment may not be annulled because the State has C
a definite policy of allotting land to religious, social, educational
and philanthropic bodies, organisations/institutions without any
advertisement or inviting applications and without even charging
premium is being mentioned only to be rejected. From the lists
annexed with the affidavits of Shri Uma Shankar Bhargav and
Shri Anil Srivastava it does appear that the State and its D
functionaries have allotted various parcels of land to different
institutions and organizations between 1982 to 2008. Large
number of these· allotments have been made to the
departments/establishments of the Central Government/State
Governments and their agencies/instrumentalities. Some plots E
have been allotted to the hospitals and charitable institutions.
Some have been allotted to different political parties, but quite
a few have been allotted to the caste/community based bodies.
Allotments have also been made without charging premium and
at an annual rent of Re. 1/- only. F
39. In our view, these allotments cannot lead to an inference
that the State Government has framed a well-defined and
rational policy for allotment of land. The RBC also does not
contain any policy for allotment of land without issuing any G
advertisement and without following a procedure in which all
similarly situated persons can stake their claim for allotment.
Part IV of the RBC contains the definition of Nazul land and
provides for allotment of land at market price or concessional
price. The authorities competent to allot land for different H
138 SUPREME COURT REPORTS [2011] 5 S.C.R.
A purposes have also been identified and provisions have been
made for scrutiny of applications at different levels. However,
these provisions have been misinterpreted by the functionaries
of the State for several years as if the same empowered the
concerned authorities to allot Nazul land without following any
B discernible criteria and in complete disregard to their obligation
to act in accordance with the constitutional norms. UnfortrJnately,
the Division Bench of the High Court overlooked that the entire
process of reservation of land and allotment thereof was fraught
with grave illegality and was nothing but a blatant act of
c favoritism on the part of functionaries of the State and
summarily dismissed the writ petition.
40. The next question which needs consideration is
whether notifications dated 6.6.2008 and 5.9.2008 by which the
Bhopal Development Plah was modified are ultra vires the
D provisions of Section 23-A of the Act. A reading of the
provisions contained in Chapter-IV of the Act makes it clear that
a development plan shall take into account the draft-five year
and annual development plan of the district, if any, prepared
under the Madhya Pradesh Zila Yogana Samiti Adhiniyam and
E broadly indicate the land use proposed in the planning area,
allocation of areas or zones of land for residential, industrial,
commercial or agricultural purpose; open spaces, parks and
gardens, green-belts, zoological gardens and playgrounds;
public institutions and offices and other special purposes as
F the Director may deem it fit. The development plan shall also
lay down the pattern of National and State Highways connecting
the planning area with the rest of the region, ring roads, arterial
roads and the major roads within the planning area etc. The
development plan prepared under Chapter IV is the foundation
G of development of the particular area for a specified number
of years. No one can use land falling within the area for which
the development plan has been prepared for a purpose· other
than for which it is earmarked. Section 23-A was inserted in
1992 and amended in 2005 with a view to empower the State
H Government to modify the development plan or zoning plan.
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 139
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
However, keeping in view the basic objective of planned A
development of the areas to which the Act is applicable, the
Legislature designedly did not give blanket power to the State
Government to modify the development plan. The power of
modification of development plan can be exercised only for
specified purposes. In terms of Section 23-A(1)(a), the B
development plan can be modified by the State Government
either suo motu or at the request of the. Authority for any
proposed project of the Government of India or the State
Government and its enterprises or for any proposed project
relating to development of the State or for implementing a c
scheme of the Authority. Under clause (b), the State
Government can entertain an application from any person or
association of persons for modification of development plan for
the purpose of undertaking any activity or scheme which is
considered by the State Government or the Director, on the D
advice of the committee constituted for this purpose, to be
beneficial to the society. This is subject to the condition that the
modification so made shall be an integral part of the re'l(ised
development plan. Section 23-A(2) provides for issue of public
notice inviting objections against the proposed modification of E
the plan. Such notice is required to be published along with the
modified plan continuously for two days in two daily newspapers
which are on the list of the Government and which have
circulation in the area. A copy of the notice is also required to
be affixed in a conspicuous place in the office of the Collector.
After considering the objections and suggestions, lf any F
received, and giving reasonable opportunity of hearing to the
affected persons, the State Government can confirm the
modification.
41. It is not in dispute that in the Bhopal Development plan, . G
the use of land which was reserved and allotted to respondent
No.5 was shown as public and semi public (health). The State
Government modified the plan by invoking Section 23-A(1)(a)
of the Act for the purpose of facilitating establishment of an
institute by respondent No. 5 and not for any proposed project H
140 SUPREME COURT REPORTS (2011] 5 S.C.R.
A of the Government of India or the State Government and its
enterprises or for any proposed project relating to development
of the State or for implementation of the Town Development:
Scheme. As a matter of fact, the exercise undertaken for the
change of land use, which resulted in modification of the
8 development plan was an empty formality because land had
been allotted to respondent No.5 almost two years prior to the
issue of notification under Section 23-A (1 )(a) and the objects
for which respondent No.5 was registered as a trust have no
nexus with the purpose for which modification of development
c plan can be effected under that section. Therefore, there is no
escape from the conclusion that modification of the
development plan was ultra vires the provisions of Section 23-
A(1 )(a) of the Act.
42. The challenge to the locus standi of the appellant
D merits rejection because it has not been disputed that the
appellant is a public spirited organization and has challenged
other similar allotment made in favour of Punjabi Samaj, Bhopal,
That apart, as held in Shivajirao Nilangekar Patil v. Mahesh
Madhav Gosavi (1987) 1 sec 227 even if a person files a writ
E petition for vindication of his private interest but raises question
of public importance involving exercise of power by men in
authority then it is the duty of the Court to enquire into the
matter.
F 43. The argument of Shri Ranjit Kumar that the doctrine of
prospective over ruling should be invoked and the allotment
made in favour of respondent No.5 may not be quashed sounds
attractive but cannot be accepted because we have found that
the impugned allotment is the result of an exercise undertaken
G in gross violation of Article 14 of the Constitution and is an act
of favoritism and nepotism. The judgment in Harish Dhingra
v. State of Haryana (supra) on which reliance was placed by
Shri Ranjit Kumar is clearly distinguishable. In that case the
Court had noted that plots had been allotted by the Chief
Minister out of his discretionary quota in the backdrop of an
H
AKHIL BHARTIYA UPBHOKTA CONGRESS v. STATE 141
OF MADHYA PRADESH AND ORS. [G.S. SINGHVI, J.]
earlier judgment of the Division Bench of the High Court in S.R. A
Dass v. State of Haryana (1988 PLJ 123) and several allottees
had altered their position.
44. In view of the above discussion, we do not consider it
necessary to deal with the argument of Shri Ravi Shanker B
Prasad and Shri Ranjit Kumar that the land could have been
allotted to the Memorial Trust even though it has not been
registered as a trust under the 1951 Act or the Indian Trusts
Act.
45. In the result, the appeal is allowed. The impugned order C
of the Division Bench of the High Court is set aside and the
writ petition filed by the appellant is allowed. The allotment of
20 acres land to respondent No.5 is declared illegal and
quashed. Notifications dated 6.6.2008 and 5.9.2008 issued by
the State Government under Section 23-A(1)(a) and (2) are also D
quashed. Commissioner, Town and Country Planning, Bhopal
is directed to take possession of the land and use the same
strictly in accordance with the Bhopal Development Plan. The
State Government is directed to refund the amount deposited
by respondent No.5 within a period of 15 days from today. E
D.G. Appeal allowed.
Search Indian case law
Ask in plain English, not just keywords. 25,000 AI words free, no card.
Try "Article 14"Sign in to search