AJANTA ENGINEERING CORPORATION LTD. V. UNION OF INDIA AND ORS.

CWP/10284/2010

AI Insights

The case involves Ajanta Engineering Corporation, a proprietorship firm, challenging the notifications and orders related to the acquisition of its land and factory building in Gurgaon by the State of Haryana and the Union of India. The petitioner argued against the notifications issued under the Land Acquisition Act, 1894, and the subsequent orders that denied the release of the land from acquisition. The court examined the history of the land's use, the legal restrictions imposed due to its proximity to a military explosive area, and the procedural adherence in the acquisition process. The court found that the land had not been used for the intended industrial purposes for a long time and that the acquisition had lapsed due to the lack of possession and compensation, as per the 2013 Act.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 742293 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 29-05-2014
• Assessment Year: misc
• Other Referred Cases: Krishan Chand Jain & Ors. vs. State of Haryana & Ors., Ram Kishan & Ors. Vs. State of Haryana & Ors., Shanti Sports Club vs. Suresh Goel's cases, Union of India and others v. Shiv Raj and others
• Laws Referred To: Land Acquisition Act, 1894, Indian Works of Defence Act, 1903, Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, 1963, Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: SANDEEP BANSAL; PALIKA MONGA
• Assessee Lawyers: SHAILENDRA JAIN
• Keywords: Compensation; Industrial Unit; Land Acquisition; Public Purpose; Unauthorized Construction; Restricted area; Exemption from acquisition
• Section: 11; 6; 9; 3; 4; 5(a); 7-B

Judgement Text

"HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** CWP-10284-2010 (O&M) Date of Decision: May 29, 2014 **** Ajanta Engineering Corporation . . . Petitioner vs. Union of India & Ors. …. Respondents **** CORAM : CORAM : CORAM : CORAM : HON’BLE MR.JUSTICE SURYA KANT HON’BLE MR.JUSTICE SURYA KANT HON’BLE MR.JUSTICE SURYA KANT HON’BLE MR.JUSTICE SURYA KANT HON’BLE MR HON’BLE MR HON’BLE MR HON’BLE MRS S S S.JUSTICE .JUSTICE .JUSTICE .JUSTICE LISA GILL LISA GILL LISA GILL LISA GILL **** 1. Whether Reporters of local papers may be allowed to see the judgment? 2. To be referred to the Reporters or not? 3. Whether the judgment should be reported in the Digest? **** Present: Mr. Shailendra Jain, Advocate for the petitioner Mr. Sandeep Bansal, Sr.Panel Counsel for UOI Ms. Palika Monga, DAG Haryana **** SURYA KANT J. SURYA KANT J. SURYA KANT J. SURYA KANT J. (1) The petitioner is a proprietorship firm. It impugns the notifications dated 11.08.2004, 09.08.2005 (Annexures P19 & P23) issued under Sections 4&6 of the Land Acquisition Act, 1894 (in short, ‘the Act’) and the Award dated 08.12.2006 (Annexure P25) as well as the order dated 10.06.2009 (Annexure P29) whereby its claim for the release of land and factory building from acquisition, has been turned down. (2) The petitioner was the owner of a piece of land measuring 5 kanal 14 marla situated in the revenue estate of village Molahera, Tehsil and District Gurgaon, where a small-scale industrial unit for manufacturing shell-moulding and cross-forging was set up. The unit was duly registered by the District Industries Officer, Gurgaon. The petitioner also obtained change of land use permission on 10.11.1972 Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 2 – (Annexure P3) from the Town and Country Planning Department before constructing the factory building. The petitioner also availed loan and cash credit facilities from the financial institutions by mortgaging its land for construction, plant and machinery and working capital. (3) It appears from the petitioner’s own documents that its industrial unit did not survive for long and as per the assessment orders passed under the Income Tax Act, 1961, it started running into losses in the year 1975-76 and soon thereafter was closed down. (4) The petitioner’s land measuring 3K-6M comprising khasra No.21/16/2/2 was acquired by State of Haryana vide Award No.20 dated 25.03.1983 and according to the respondents, the possession of that land was taken on the same day and handed over to HUDA though the petitioner still claims its possession over that land also. The aforesaid award has attained finality as the above-stated acquisition was never challenged by the petitioner. (5) The petitioner has after giving an irrelevant description of a civil suit for recovery filed by the State Bank of India against it, referred to the notifications dated 29.08.1987 and 28.04.1988 issued under Section 3 read with Section 7(b) of the Indian Works of Defence Act, 1903 imposing the restrictions described in Schedule A, B & C, in respect of the use and enjoyment of certain lands situated in District Gurgaon. Those restrictions, against raising any construction etc. within a distance of 900 mtrs. from the crest of the outer parapet of the explosive area No.54, ASP, Air Force Station, Gurgaon, have been re-imposed by Town and Country Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 3 – Planning Department, State of Haryana also vide their notification dated 09.10.2001. The land and factory of the petitioner admittedly falls within the prohibited area and/or restrictions imposed vide above-mentioned notifications. (6) State of Haryana issued the impugned notification dated 11.08.2004 under Section 4 of the Act proposing to acquire the land in village Molahera for the public purpose of development and its utilization for industrial purposes. The aforesaid notification included the petitioner’s left out land measuring 5K-14M along with the factory shed as well. (7) The petitioner filed objections under Section 5-A of the Act but the same did not find favour with the Collector, hence its land was included in the declaration dated 09.08.2005 published under Section 6 of the Act (Annexure P23). (8) The aggrieved petitioner came to this Court in CWP No.1896 of 2006 in which its dispossession was stayed on 09.02.2006. The Land Acquisition Collector, however, passed the Award No.27 dated 08.12.2006 (Annexure P25) wherein it was also recited that qua khasra No.21/16/2/2 (3K-6M), the award dated 25.03.1983 had already been pronounced. (9) The above-stated writ petition was disposed of by this Court vide order dated 03.12.2008 with a direction to the Director, Urban Estates Haryana to examine the case of the petitioner and decide whether its land qualifies for exemption from acquisition. The interim protection Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 4 – against dispossession was kept intact till the decision on the petitioner’s claim. (10) The petitioner’s claim was turned down by the Director, Urban Estates, Haryana vide the impugned order dated 10.06.2009 (Annexure P29) primarily on the grounds that (i) the factory shed is lying in a dilapidated condition without any roof; (ii) the entire site falls within 900 mtr. restricted belt of the ammunition depot; (iii) the construction is unauthorized as no building plans were ever approved; (iv) CLU permission of 1972 is not valid after closure of the industrial unit; (v) the petitioner has attempted to install three lathe machine with a generator set to make it look like a working manufacturing unit; (vi) a part of the acquired land is required for green-belt etc.etc. (11) The petitioner in the second round of litigation impugns the above-stated order as well as the acquisition proceedings. (12) The Union of India – respondent No.1 has filed its written statement maintaining that in view of notifications issued under Sections 3&7 of the 1903 Act, there is a restriction on any kind of construction within 900 mtrs. from the crest of outer parapet of Indian Air Force where explosives/ammunition for use by the Air Force have been stored; notices have already been issued under Section 9 of the Act by the Collector for removal of the illegal and unauthorized constructions. (13) The Land Acquisition Collector, Urban Estates, Gurgaon has filed written statement on behalf of the State of Haryana and its authorities, reiterating that the land has been acquired after complying Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 5 – with the procedure prescribed under the Act and the petitioner’s objections under Section 5-A were duly considered on merits before the Section 6 notifications were issued. It has been reiterated that the petitioner has raised unauthorized construction and that a part of the acquired land is required for the green-belt. As regard to the acquisition of khasra No.21/16/2/2, the respondents have taken the following stand:- “That in reply to para No.8 of the Civil Writ Petition, it is submitted that the acquisition proceedings regarding the land bearing khasra No.21//6/2/2(3-6) had already been completed in the year 1983. Thereafter, the land stands in the name of HUDA. Moreover, the petitioner has filed the present writ petition for quashing the notification u/s-4 dated 11-8-2004, notification u/s-6 dated 9-8-2005, the award dated 8-12-2006 and order dated 10-6-2009 and not the previous acquisition proceedings which were completed in 1983 qua the land bearing khasra No.21//16/2/2 situated in the revenue estate of village Mullahera Tehsil and Distt. Gurgaon.” (14) In addition to the replication to the written statement filed on behalf of State of Haryana, the petitioner’s proprietor has also filed several additional documents including various orders passed by this Court in COCP No.723 of 2010 (Annexure A44 colly). (15) We have heard learned counsel for the parties and gone through the record. The lay-out plan and photographs of the site referred to by them during the course of hearing have also been seen. (16) It emerges from the pleadings and the oral submissions made by the counsel that the acquired land though was utilized by the Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 6 – petitioner by setting up a small-scale industrial unit in the year 1971-72 but very soon it came to a grinding-halt for the reason best known to the petitioner. The industry went into losses from the year 1975-76 and stood closed by the end of year 1978. There is not an iota of evidence like payment of any statutory taxes, purchase of raw material or consumption of power etc. during the long spell except that the petitioner tried to project a running unit at the site by bringing three lathe machines and a generator set, only after this Court had issued directions in the year 2008 to re-consider its claim for exemption. The fact that the building is completely ruined and is without any roof is evident from the photographs, hence it is difficult to accept that there were any functional unit at the site. (17) The subject site thus was no longer used for the industrial purposes, namely, the public purpose for which the respondents have acquired the land. The petitioner’s claim that it settled the loan account in the year 2000 and still made no effort to re-start the industrial unit, leaves no room to doubt that the property was retained for speculative gains due to escalation in real estate prices. (18) In this factual backdrop and owing to the legislative policy or object behind the 1894 Act (since repealed), the scope of interference in the acquisition has to be limited only on account of non-observance of the mandatory procedure or for want of any public purpose behind acquisition. None of these illegalities have been proved by the petitioner. Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 7 – (19) It may be true that the petitioner obtained CLU permission to use the agriculture land for industrial purposes. It however, did not absolve the petitioner from raising construction only after obtaining prior permission from the competent authority under Section 6 of the Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development Act, 1963 (as applicable to Haryana), which reads as follows:- “6. Erection or re-erection of buildings etc. in controlled areas.— Except as provided hereinafter, no person shall erect or or-erect any building or make or extend any excavation or lay out any means or access to a road in a controlled area save in accordance with the plans and the restrictions and conditions referred to in section 5 and with the previous permission of the Director: Provided that no such permission shall be necessary for erection or re-erection of any building if such building is used or is to be used for agricultural purpose or purposes subservient to agriculture: Provided further that nothing in this section shall apply to a building constructed along with the extension of the scheduled road located in the limit of the local authority and which was in existence immediately before the commencement of the Punjab Scheduled Roads and Controlled Areas Restriction of Unregulated Development (Haryana Amendment) Ordinance, 2009 (Haryana Ordinance No.1 of 2009), on payment of such fee, as may be prescribed.” Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 8 – (20) A structure which was unauthorisedly raised from the very inception, cannot take shelter behind the fact that notification under Section 3 read with Section 7(b) of 1903 Act was issued in the year 1987 or that such construction was raised prior thereto. The import and mandate of notification issued under 1903 Act have been considered in more than one decision and after referring to the case law, this Court in Krishan Chand Jain & Ors. vs. State of Haryana & Ors.(CWP No.13543 of 1990) decided on 31.10.2013 (pertaining to the same area) held as follows:- “[19]. It may be true that giving effect to the Government Policies dated 26.10.2007 as modified on 24.01.2011 and which have been held to be enforceable in Patasi Devi & Ors. Vs. State of Haryana & Ors. 2012[9] SCC, 503, this Court has passed 'n' number of orders for the release of residential houses and other structures found in existence at the time of Section 4 notification. One such order dated 17.07.2013 passed in CWP No. 19999 of 2012 [Ram Kishan & Ors. Vs. State of Haryana & Ors.] and other connected cases pertaining to acquisition of land of Sector 37-C, Gurgaon has been heavily relied upon by learned counsel for the petitioners also. It goes without saying that in a case of irregular constructions say for want of permission by the Competent Authority, the petitioners could seek the benefit of above stated Government policies for the release of the subject structures. The cited cases are, however, totally distinguishable due to the peculiarity of facts and a brazen violation of the substantive provisions of the Defence Act. The two decisions in Shanti Sports Club Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 9 – and Suresh Goel's cases [supra], unequivocally hold that provisions of the Defence Act must have over-riding effect over the local laws or the executive policies and the private interests must be subservient to the national interest embedded in the Defence Act.” (21) Suffice it to mention here that it is the petitioner’s own case that the subject land falls within 900 mtrs. from the crest of the outer parapet of the explosive area No.54, ASP, Air Force Station, Gurgaon. The petitioner thus cannot be allowed to take undue advantage of an illegal construction and then seek exemption from the rigours of the 1903 Act or the restrictions imposed thereunder. (22) We may hasten to add here that in Krishan Chand Jain’s case (supra) also, this Court did not permit State of Haryana or HUDA to utilize the acquired land for the purpose of raising construction, residential or industrial, as such utilization of the land would also be in total disregard to the notifications issued under Section 3 & 7 of the 1903 Act. As the over-riding effect of the later Act deserves acceptance not only within the constitutional framework, it being a Central Act, its supremacy would be otherwise also in the national interest. Reiterating the said view, we hold in this case that no part of the land falling within 900 mtrs. restricted area can be permitted to be utilized for industrial purposes and even the respondents shall have to restore that land to its original use as agricultural or open land and keep it free from any construction though it can always be utilized as a green-belt etc. Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 10 – (23) So far as the petitioner’s plea regarding khasra No.21/16/2/2 (3K-6M) is concerned, we find it strange and misleading that despite its acquisition vide Award No.20 dated 25.03.1983 has attained finality, the petitioner harps upon a plea alleged to have been taken by the Land Acquisition Collector in the Civil Suit filed by the Bank for recovery of its dues against the petitioner, suggesting as if the land was still owned by the petitioner. Any such plea, contrary to the record, taken by the Collector, with or without the collusion, is inconsequential and does not advance the petitioner’s case in any manner. The plea qua the aforesaid khasra No. is also thus rejected. (24) We may now deal with the last contention raised on behalf of the petitioner on the strength of averments made in an additional affidavit dated 28.03.2014 wherein the petitioner has averred that the impugned acquisition stands lapsed in view of Section 24 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (in short, ‘the 2013 Act’). (25) For the correct appreciation of the above-mentioned contention, it may be noticed here that the award in respect of the petitioner’s land was passed on 08.12.2006. The aggrieved petitioner approached this Court in CWP No.1896 of 2006 (M/s Ajanta Engineering Corporation vs. State of Haryana & Ors.) in which the ad interim stay against dispossession was granted by this Court on 09.02.2006. The aforesaid writ petition was disposed of by this Court on 03.12.2008 with a direction to the respondent-authorities to examine the case of the Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 11 – petitioner whether its land qualify for exemption from acquisition. The appropriate decision was required to be taken in a time-bound manner. It was further directed that “the possession of the petitioner as was existing on 9.2.2006, when this Court passed an order staying the dispossession shall remain intact till the decision of the representation by the Director”. (26) The Director, Town and Country Planning Department, however, rejected the petitioner’s claim for exemption from acquisition vide impugned order dated 10.06.2009 (Annexure P29) which is under challenge in the instant writ petition. (27) This Court vide order dated 27.05.2010 again directed that status quo with regard to the possession shall be maintained till further orders. There is no averment in the written statement that during the interregnum the physical possession of the acquired property was taken over by the respondent-authorities. (28) In this undisputed factual backdrop, the solitary question that arises for consideration is whether the petitioner is entitled to seek benefit of Section 24(2) of the 2013 Act? (29) The aforementioned question is no longer res-integra. The Hon'ble Supreme Court in its recent judgment dated 07.05.2014 rendered in Civil Appeals No.5478-5483 of 2014, Union of India and others v. Shiv Raj and others, has interpreted Section 24(2) of 2013 Act in the context of those cases where State could not take possession of the acquired land due to interim stay orders passed by the court and Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 12 – meanwhile, the 2013 Act has come into force w.e.f. 01.01.2014. In the cited decision, the Hon'ble Supreme Court has held as follows:- “4. Limitation As regards this item relating to the period spent during litigation would also be accounted for the purpose of determining whether the period of five years has to be counted or not, it should be clarified that it will apply only to cases where awards were passed under Section 11 of the Land Acquisition Act, 1894, 5 years or more prior to 1.1.2014 as specified in Section 24(2) of the Act, to avoid any ambiguity. Since this legislation has been passed with the objective of benefiting the land-losers, this interpretation is consistent with that objective and also added as a matter of abundant caution that the period spent in litigation challenging an award cannot be excluded for the purpose of determining whether the period of five years has elapsed or not. If the possession has not been taken or compensation has not been paid due to the challenge to the land acquisition proceedings, the pendente lite period will be included to determine the five year period and including such period if the award was made five years or more prior to the commencement of the Act, then the said acquisition proceedings will be deemed to have elapsed and fresh proceedings, if so desired, will have to be initiated in accordance with the new Act.” The objects and reasons of the Act 2013 and particularly clause 18 thereof fortify the view taken by this court in the judgments referred to hereinabove. Clause 18 thereof reads as under: “The benefits under the new law would be available in all the cases of land acquisition under the Land Acquisition Act, 1894 where award has not been made or possession of land has not been taken.” Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 13 – (Emphasis added) 20. However, the aforesaid appeals have to be decided in the light of above settled legal propositions. The admitted facts of the case remains that the Respondents-Tenure Holders had filed objections under Section 5A of the Act 1894 as admitted in the affidavit filed by Smt. Usha Chaturvedi, Deputy Secretary (Land Acquisition), Land and Building Department, Vikas Bhawan, New Delhi, filed in January 2014 before this court. The award no. 15/87-88 had been made on 5.6.1987 and possession has not been taken till date though compensation has been deposited with the Revenue Department, which cannot be termed as 'deemed payment' as has been held in case of Pune Municipal Corporation & Anr. (Supra).” (30) The respondents have admittedly not taken possession of the acquired land in the instant case, of course, due to stay orders passed by this Court. The award was passed more than five years before 01.01.2014 i.e., the date when the 2013 Act came into force. The petitioner has not received any compensation also till date. The principle of inclusion of pendente lite period expounded in Shiv Raj and others' case (supra) thus is fully applicable in the instant case. (31) There can thus be no escape but to hold that the acquisition in the instant case stands lapsed and consequently, the impugned notifications as well as the award qua the acquisition of the petitioner’s land are set aside. However, keeping in view the other findings in the impugned order, namely, that the construction was unauthorized or that no construction can be allowed to be raised on the subject land in Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document CWP No.10284 of 2010.doc - 14 – violation of the notifications issued under the 1903 Act, we restrain the petitioner from using the subject land for industrial, commercial or residential purposes. In other words, the petitioner shall be required to keep the land in the same manner as has been directed in para 22 of this order. Similarly, keeping in view the larger public interest, namely, the location of the land near to the crest of the outer parapet of the explosive area No.54, ASP, Air Force Station, Gurgaon coupled with the fact that a substantial part of the land is required for development of greenbelt, we also restrain the petitioner from creating third party right or alienating the land in any manner whatsoever for a period of one year so as to enable the respondent-authorities to take an appropriate decision for acquiring the subject land afresh in accordance with the provisions of the 2013 Act. (32) Ordered accordingly. Dasti. (Surya Kant) (Surya Kant) (Surya Kant) (Surya Kant) Judge Judge Judge Judge May May May May 29 29 29 29, 2014 , 2014 , 2014 , 2014 vishal shonkar ( ( ( (Lisa Gill Lisa Gill Lisa Gill Lisa Gill) ) ) ) Judge Judge Judge Judge Vishal V 2014.07.25 12:52 I attest to the accuracy and integrity of this document "