-1- IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 153 OF 2008 1. Anil Nemichand Bafna ) 2. Hemant Chandan Khinvsara ) 3. Pushpa Chandan Khinvsara ) 4. Suresh Champalal Kankaria ) 5. Dilip Nemichand Bafna ) 6. Rajendra Nemichand Bafna ) 7. Pradeep Nemichand Bafna ) 8. Amit Anil Bafna ) 9. Anita Anil Bafna ) through their P.A. Holder Atul Mansukhlal Lunkad ) All r/o 562/7, Shivaji Nagar, Pune-5. )..Petitioners versus 1. State of Maharashtra ) Urban Development Department, ) Mantralaya, Mumbai-400 032. ) 2. Competent Authority, Pune Urban Agglomeration, ) Pune under Urban Land (Ceiling and Regulation) ) Act, 1976. )..Respondents Mr. S.M. Gorwadkar for the petitioner. Smt. P.S. Cardoza, AGP, for the State. CORAM: P.B. MAJMUDAR & R.G. KETKAR, JJ. Judgment reserved on: 27 th April, 2010 Judgment pronounced on: 06 th May, 2010 JUDGMENT: (Per P.B. Majmudar, J.) 1. Rule. Learned AGP waives service of Rule on behalf of respondents. With the consent of the learned counsel, the matter is taken up for hearing -2- forthwith. 2. By way of this petition, the petitioners have challenged the decision of the State Government dated 31st October, 2007, passed under Section 34 of the Urban Land (Ceiling and Regulation) Act, 1976, hereinafter referred to as “the Act”. The petitioners have also prayed for declaration that the State Government has no authority to decide any revisional proceedings under Section 34 of the Act after 14th March, 2007, the day on which the State of Maharashtra had proposed to repeal the Act. 3. In connection with the disputed property of the petitioners, an order was passed on 24th March, 2003, by the Competent Authority under Section 8 (4) of the Act in ULC Case No. 1539 /13A. The said order was passed on the basis of the statement filed by the petitioners under Section 6 (1) of the Act. In the statement, the petitioners had pointed out that no construction was permitted so far as S. No. 18/8 situate at Rahatni as there was no access road for the said plot and that therefore it could not have been treated as vacant land. So far as land at S. No. 134/2/1/1 at Pashan is concerned, according to the petitioners, the said area was affected by the road widening and as regards the rest of the area, the same were owned by 10 persons and they were all entitled to hold one unit each i.e. 1000 sq.mtrs. The Competent Authority adjudicated the statement filed by the petitioners and by order dated 24th -3- March, 2003 came to the conclusion that so far as Survey No. 18/8 is concerned, it did not have any approach road on the appointed day i.e. 17-2-1976 when the Act came into force. It was also noted that so far as S. No. 134/2/1/1 of village Pashan is concerned, the same was affected by road widening to the extent of 2710 sq.mtrs. Out of 11400 sq.mtrs. The Competent Authority found that the petitioners are entitled to hold 9000 sq.mtrs. as against that they were holding 8690 sq.mtrs. which is below the ceiling limit. The Competent Authority accordingly by its order dated 24th March, 2003 came to the conclusion that the Petitioners were not holding any surplus vacant land under the Act. 4. Subsequently, the District Collector, Pune, granted non-agricultural permission in respect of S. No. 18/8 by an order dated 3rd January, 2005. The petitioners were thereafter granted commencement certificate on 11th March, 2005 for developing the said S. No. 18/8. In the meanwhile, the State of Maharashtra by a resolution dated 14-3-2007 proposed to repeal the Act. In September, 2007, the petitioners received a notice in respect of suo motu proceedings initiated by the Government under Section 34 of the Act in respect of S. No.134/2/1/1 situate at Pashan and S.No. 18/8 situate at Rahatni. It is the case of the petitioners that since necessary papers were not available with the petitioners, a request was made for an adjournment of the hearing but the said request was rejected. The State Government thereafter by its order dated -4- 31-10-2007 set aside the order of the Competent Authority dated 24th March, 2003 in ULC Case No. 1539-BA in respect of S. No. 18/8 situate at Rajatni and S.No. 134/2/1/1 situate at Pashan. By the said order, the petitioners were directed to pay land value at the market rate prevailing as per the ready reckoner of the Government of Maharashtra within 30 days failing which it was ordered that proceedings to recover the said amount will be initiated as per Section 38 of the Act. It is the case of the petitioners that subsequently the State Legislature adopted the repealed Act and ultimately the said Act was repealed by the State of Maharashtra on 29th November, 2007. The petitioners have challenged the said order passed by the State Government in suo motu revision application initiated under Section 34 of the Act. 5. Mr. Gorwadkar, learned counsel for the petitioners, has challenged the aforesaid decision on the ground that the action of the State Government in exercising revisional powers is on the face of it unsustainable and that such revisional powers were not exercised within reasonable time. The Competent Authority passed an order on 24th March, 2003 as against that the revisional power is exercised after four years in 2007 and that too when proceedings for repealing the Act were under contemplation by the State Legislature. Mr. Gorwadkar also pointed out that at the time when the Government exercised revisional powers, the property was developed and it was sold to various persons and in that view of the matter, the revisional powers were not -5- required to be exercised after such inordinate delay. Mr. Gorwadkar further submitted that when admittedly there is no notification under Sections 10 (1) and (3) of the Act, the proceedings can be said to be abated and, therefore, the order of the State Government is also not enforceable as no market value can now be fixed in view of the repeal of the Act. The learned counsel for the petitioners has placed reliance on the decision of the Supreme Court in the case of Mukarram Ali Khan vs. State of U.P. and others1 wherein it has been held that since the State has not taken the possession over the surplus land, the proceedings have to be treated to have abated under Section 4 of the Repeal Act. The learned counsel further submitted that even otherwise under Section 34 of the Act, the State is not entitled to pass any order asking the petitioners to pay the price at the market rate and, therefore, the order is without jurisdiction. It is further submitted that even otherwise, the State should have remanded the matter to the Competent Authority to decide the matter de novo. The learned counsel for the petitioners further submitted that the State Government in a hurried manner could not have passed the order under Section 34 of the Act, without affording a reasonable opportunity to the petitioners. In order to substantiate his say on the question of repealed Act as well as on the ground that revisional powers could not have been exercised after such a long time, Mr. Gorwadkar relied upon certain judgments, reference of which will be made later on. 1 2007 ALL SCR 2767 -6- 6. Ms. Cardoza, learned AGP, on the other hand, vehemently submitted that at the time when the plots in question became vacant land and when permission to build was granted, fresh statement was required to be submitted by the petitioners. Since no such statement was subsequently given, the Government has rightly initiated suo motu proceedings in this behalf under Section 34 of the Act. Learned AGP further submitted that it was the duty of the petitioners to file a further statement after the land became vacant and not having done so, the suo motu powers were exercised by the State Government. Learned AGP further submitted that the Government has powers to call for and examine the record of any order passed by the competent authority at any point of time by exercising suo motu powers. She further submitted that since third party interest was created by putting construction, an equitable order was passed by which it was decided to charge value of the land at the market rate. The learned AGP submitted that since there was no question of taking possession and since no proceedings were pending, there was no question of abatement of any proceedings in view of the repealed Act as, according to her, the provisions of repealed Act are not applicable. She submitted that the Government has suo motu powers to call for and examine the record of any order passed or proceedings taken. Such powers can be exercised for the purpose of satisfying itself as to the legality or propriety of such order or as to the regularity of such procedure which is adopted by the lower quasi judicial -7- authority exercising powers and can examine the order passed by the competent authority while deciding the proceedings under Section 8 (1) and 9 of the Act. She submitted that Section 34 of the Act clearly states that the revisional authority may pass such orders with respect thereto as it may think fit. She further submitted that the revisional authority passed the impugned order after considering the facts of the case and such powers were rightly exercised by the Government. She submitted that the petitioners had failed to file statement under Sections 6 and 15 of the Act after the land was converted into non- agricultural and thereby concealed material particulars and as such the petitioners are liable to pay penalty under the Act. The only restriction with regard to penalty is that such a sum shall not exceed twice the amount representing the value of vacant land. She has filed written submissions to substantiate her say. She has also relied upon case laws, a reference of which will be made later on. 7. We have heard the learned counsel appearing for the parties at great length. We have also gone through the written submissions filed by the learned Assistant Government Pleader on behalf of respondent Nos. 1 and 2. We have also considered the various case laws cited at the Bar by both sides. 8. As stated above, the Competent Authority passed an order under Section 8 (4) of the Act on 24th March, 2003 and held that the petitioners did -8- not hold any surplus vacant land and they were declared to be non-surplus land holders. It is also not in dispute that the Collector, Pune has granted non- agricultural permission in respect of S. No. 18/8 situate at Rahatni and Municipal Corporation gave commencement certificate for developing the said land. The Petitioners received a notice from Respondent No.2 on 28th September, 2007 in respect of hearing of the suo motu revision initiated by the State Government under Section 34 of the Act. The Petitioners were not given sufficient opportunity to place the correct facts before the State Government. The petitioners pointed out that the petitioners had acted upon the order of the Competent Authority and had developed the land. Ultimately the order passed by the Competent Authority dated 24th March, 2003 was set aside and it was directed that the petitioners should pay current land value as per the market rate prevailing as per the ready reckoner of the State Government. It is not in dispute that the petitioners have already developed the land and after the development third party rights have been created by way of registered sale deeds. After granting non-agricultural permission by the District Collector, Pune, the petitioners were given commencement certificate by the Municipal Corporation for developing S. No. 18/8 on 11th March, 2005. Subsequently at the relevant time when the proposal for bringing the repealed Act into force was pending, proceedings were initiated in September, 2007 for taking the matter in suo motu revision by issuing the notice to the petitioners and ultimately the impugned order is passed on 31st October, 2007. In our view, there is considerable delay -9- in exercising the suo motu powers as the Competent Authority decided the declaration and return filed by the petitioners under Section 6 (1) of the Act in March, 2003 as against that the suo motu revisional powers were exercised in 2007. There is nothing in the impugned order justifying the delay in exercising the revisional jurisdiction. The learned AGP, however, vehemently submitted that under Section 34 of the Act the Government is empowered to pass appropriate orders as deemed fit and there is nothing in Section 34 of the Act by which any period of limitation is prescribed. At this stage it may be useful to refer Section 34 of the Act which reads thus: 34. Revision by State Government:- The State Government may, on its own, call for and examine the records of any order passed or proceeding taken under the provisions of this Act and against which no appeal has been preferred under Section 12 or Section 30 or Section 33 for the purpose of satisfying itself as to the legality or propriety of such order or as to the regularity of such procedure and pass such order with respect thereto as it may think fit. Provided that no such order shall be made except for giving the person affected a reasonable opportunity of being heard in the matter.” In our view, when the status of the land is already changed in between as the petitioners had developed the land and third party rights have been created, exercise of suo motu revisional power after a long lapse of four years is not at all justified. The learned counsel for the petitioner has invited our attention to the Judgment of the Supreme Court in the case of State of Gujarat vs. Patel Raghav -10- Natha1 wherein the Supreme Court has held as under: “The question arises whether the Commissioner can revise an order made under Section 65 at any time. It is true that there is no period of limitation prescribed under Section 211, but it seems to us plain that this power must be exercised in reasonable time and the length of the reasonable time must be determined by the facts of the case and the nature of the order which is being revised. 12. It seems to us that Section 65 itself indicates the length of the reasonable time within which the Commissioner must act under Section 211. Under Section 65 of the Code if the Collector does not inform the applicant of his decision on the application within a period of three months the permission applied for shall be deemed to have been granted. This section shows that a period of three months is considered ample for the Collector to make up his mind and beyond that the legislature thinks that the matter is so urgent that permission shall be deemed to have been granted. Reading Sections 211 and 65 together it seems to us that the Commissioner must exercise his revisional powers within a few months of the order of the Collector. This is reasonable time because after the grant of the permission for building purposes the occupant is likely to spend money on starting building operations at least within a few months from the date of the permission. In this case the Commissioner set aside the order of the Collector on October 12, 1961 i.e. more than a year after the order, and it seems to us that this order was passed too late.” The learned counsel for the petitioners submitted that the revisional jurisdiction cannot be exercised after expiry of the period of three years from the date on which the order of the Competent Authority is made. In support of his contention, the learned counsel also placed reliance on the decision of a Division Bench of this Court in the case of Smt. Meena Anil Patil and another vs. The State of Maharashtra and others, dated 23rd June, 2008. In our view, even if no period 1 AIR 1969 SC 1297 -11- is prescribed by which the State can exercise suo motu revisional powers, such powers are required to be exercised within a reasonable period. In the present case, such revisional powers are exercised after a period of four years. Such exercise is not justified so far as the facts of the present case is concerned. 9. The law is well settled by various judgments of the Supreme Court taking the view that the revisional powers are required to be exercised within a reasonable period where no limitation is prescribed. In the present case, when the Government decided to take suo motu proceedings, such powers were required to be taken within a reasonable time, taking into consideration the fact that the petitioners have created third party rights in the said land in between. In the case of A.V. Papayya Sastry and others vs. Govt. of A.P. and others1, the Supreme Court has held that even though no period of limitation is prescribed for exercise of revisional jurisdiction by the State Government suo motu, such power must be exercised within a reasonable time. The learned AGP has relied upon the decision of the learned single Judge of the Gujarat High Court in the case of Minish K.Sheth and others vs. State of Gujarat and others2, wherein the learned single Judge has taken the view that powers under Section 34 of the Act can be exercised at any point of time. The learned single Judge of the Gujarat High Court has also relied upon the decision of the Full Bench of the Kerala High 1. (2007) 4 SCC 221 2. AIR 1985 Gujarat 56, -12- Court in the case of A. Pillai v. State1 and held that the interest of the Government is to see that the objects of the Act, namely, the prevention of concentration of urban land in few hands and prevention of speculation and profiteering in the land, be achieved so that the land is equitably distributed to all. As regards delay in taking recourse to Section 34 of the Act, the learned AGP has also relied upon the decision of this Court in the case of Archana Abhay Wani and others vs. The Deputy Collector & Competent Authority (ULC), Nashik and others decided on 21st March, 2006. The learned AGP has placed reliance on the decision of the Supreme Court in the case of Govt. of A.P. and others vs. J. Sridevi and others2 and submitted that the competent authority has to decide the question as to whether the vacant land falls within the purview of the Act. Further, in none of the aforesaid judgments, the question about exercising powers under Section 34 of the Act after unreasonable period was the subject matter in issue. 10. We are unable to accept the submission of the learned AGP in view of the fact that the Supreme Court has clearly laid down that the revisional powers are required to be exercised within a reasonable period. There is also an additional factor that in between the order passed by the Competent Authority and the order passed by the State Government, there was no restraint order 1 AIR 1972 Ker 39 2 (2002) 5 SCC 37 -13- passed by Government. In view thereof, the petitioners have already developed the property and third party rights have been created. Considering the said aspect, the exercise of revisional power after such a long period of about four years was not at all justified. 11. We are also not in a position to agree with the submission of the learned AGP that such powers can be exercised at any point of time. In our view, the only exception where such suo motu revisional powers can be exercised after inordinate delay may be in a case of fraud where persons might have committed fraud in obtaining the order. But that is not the fact here so far as the present case is concerned. In our view, the revisional powers after such an inordinate delay is not at all justified and we find substance in the contention of Mr. Gorwadkar. The learned counsel for the petitioners submitted that the revisional powers under Section 34 of the Act could not be invoked at any time, if such powers were not exercised within a reasonable period. In our view and as rightly pointed out by the learned counsel for the petitioners, that the powers exercised by the State Government Under Section 34 of the Act were bad in law and, therefore, the order was unsustainable. 12. The Parliament has passed the Urban Land (Ceiling and Regulation) Act, 1999 which received the assent from the President of India on 22nd March, 1999. So far as the State of Maharashtra is concerned, the Repeal Act was to -14- come into force on such date as the Legislature of the State of Maharashtra would pass a resolution adopting the Repeal Act under clause (2) of Article 252 of the Constitution of India. The Maharashtra Legislative Assembly and the Maharashtra Legislative Council passed a resolution for adopting the Repeal Act in the State of Maharashtra with effect from 29th November, 2007. The Repeal Act has two saving clauses i.e. Sections 3 and 4. The same reads thus: “3. (1) The repeal of the principal Act shall not affect: (a) the vesting of any vacant land under sub-section (3) of section 10, possession of which has been taken over by the State Government or any person duly authorized by the State Government in this behalf or the competent authority; (b) the validity of any order granting exemption under sub- section (1) of section 20 or any action taken thereunder, notwithstanding any judgment of any court to the contrary; (c) any payment made to the State Government as a condition for granting exemption under sub-section (2) of section 20. (2) Where - (a) any land is deemed to have vested in the State Government under sub-section (3) of Section 10 of the principal Act but possession of which has not been taken over by the State Government or any person duly authorized by the State Government in this behalf or by the competent authority; and (b) any amount has been paid by the State Government with respect to such land, then, such land shall not be restored unless the amount paid, if any, has been refunded to the State Government. 4. All proceedings relating to any order made or purported to be made under the principal Act pending immediately -15- before the commencement of this Act, before nay court, tribunal or other authority shall abate. Provided that this section shall not apply to the proceedings relating to Sections 11, 12, 13 an 14 of the principal Act in so far as such proceedings are relatable to the and, possession of which has been taken over by the State Government or any person duly authorized by the State Government in this behalf or by the competent authority.” 13. It is not in dispute that there is no order of taking possession of the excess land from the petitioners and, therefore, naturally there is no notification under Section 10 (3) of the Act. The learned AGP vehemently argued that the revisional Court has not remanded the matter to the competent authority and has passed equitable orders ordering the petitioners to pay the market price as per the ready reckoner in view of the fact that the petitioners have created third party rights in the property. She submits that when a person who has concealed particulars or furnished inaccurate particulars, such person is liable to pay penalty which shall not be less than the amount representing the value of the vacant land or of such land or both, as the case may be, in respect of which particulars have