IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE PIUS C.KURIAKOSE WEDNESDAY, THE 29TH OCTOBER 2008 / 7TH KARTHIKA 1930 WP(C).No. 13949 of 2008(I) -------------------------- PETITIONER(S): --------------- M/S. KALLARACKAL RESORTS PVT.LTD., CORPORATE OFFICE: 1864/C-1, FIRST FLOOR, NEAR ST. ANTONY'S CHURCH, VADUTHALA, KOCHI-682 023,REP: BY ITS MANAGING DIRECTOR, ROY JOSEPH, RESIDING AT HOUSE NO.47/1881, VADUTHALA P.O, KOCHI-682023. BY ADV. SRI.ROY CHACKO RESPONDENT(S): --------------- 1. STATE OF KERALA, REPRESENTED BY THE SECRETARY, DEPT.OF REVENUE (FAST TRACK PROJECT), SECRETARIAT, THIRUVANANTHAPURAM. 2. THE DISTRICT COLLECTOR, ERNAKULAM. 3. THE SPECIAL TAHSILDAR (REVENUE),LAND ACQUISITION FOR VALLARPADAM CONTAINER TERMINAL PROJECT, ELOOR P.O, ERNAKULAM DIST. 4. THE COCHIN PORT TRUST, REPRESENTED BY ITS CHAIRMAN, WILLINGDON ISLAND, KOCHI-3. 5. THE PROJECT DIRECTOR, PIU, KOCHI, NATIONAL HIGHWAY AUTHORITY OF INDIA, VYTTILA, KOCHI-682019. ADV.SRI.A.M.SHAFFIQUE FOR R4 SRI.E.K.NANDAKUMAR FOR R4 SRI.A.K.JAYASANKAR NAMBIAR FOR R4 SRI.K.JOHN MATHAI FOR R4 SRI.P.BENNY THOMAS FOR R4 SRI.ANIL D. NAIR FOR R4 SRI.THOMAS ANTONY FOR R.5 GOVT. PLEADER SRI.D.ANILKUMAR FOR R1 TO R3 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 29/10/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: PIUS C. KURIAKOSE, J. ----------------------------------------------- W.P.(C)No. 13949 OF 2008 ----------------------------------------------- Dated this the 29th day of October, 2008 J U D G M E N T As amended, the above writ petition filed by M/s. Kallarackal Resorts Pvt. Ltd. a company running a three star backwater tourism resort at Kothad Island by name “Kamyakam Haven” seeks a writ of certiorari to quash Ext.P4 award notice under section 12(2) dated 18- 4-2008 and Ext.P12 award of even date issued/passed by the third respondent Land Acquisition Officer for the Vallarpadam Container Terminal Project. The other prayer sought for in the writ petition are appropriate directions to the first respondent State, the second respondent District Collector and the third respondent L.A. Officer to give effect to Ext.P5 Government Order granting approval to the draft award of Rs.2,57,22,412/- as compensation of the petitioner's property acquired for the ICTT – property having an extent of 40.46 Acres of land in survey No.513/3-7 of Kadamakudy Village. The further prayer in the writ petition is that Exts.P10 and P10(a) representations submitted by the petitioner for grant of compensation under a negotiated settlement be considered and decided by the concerned respondents at the earliest giving hearing opportunity to the petitioner. The petitioner claims that their resort by name “Kamyakam WP(C)N0.13949/08 -2- Haven” was constructed on land which was originally vacant land surrounded on all sides by National Waterways incurring very huge expenditure. The resort has 10 Duplex Cottages and one guest room block having 12 rooms built in traditional Kerala style and architectural design to cater to the tastes of indigenous and foreign tourists and the resort was attracting several tourists including foreigners by the beauty and charm of the backwaters and the lovely landscape surrounding the same. Out of the total extent of 4.05 acres of land owned by the petitioner company, 1.288 acres was requisitioned by the Cochin Port Trust for the purpose of constructing a 45 metre wide bridge through the resort property as part of the National Highway connectivity to the project site of the ICTT. Petitioner submits that though the length of the road which passes through the petitioner's property is only 153 metres, as a result of the acquisition, several buildings in the resort including a 24 hour multi cuisine restaurant, administrative block, conference hall, Ayurveda Centre, swimming pool etc. will be affected seriously. Fruit bearing trees and medicinal plants in the premises of the resort also were seriously affected on account of the proposed acquisition. The composite notification under section 4 (1) read with section 17 relating to the acquisition was published in the WP(C)N0.13949/08 -3- gazette and local newspapers on 27-9-2005, 10-10-2005 and 18-10- 2005. The locality publication was on 26-10-2005. The declaration under section 6 was published in the gazette on 12-1-2006 and later in daily newspapers as well as in the locality. On noticing that the proposed acquisition would compel closing down of the resort the petitioner applied under section 49(1) of the L.A. Act requesting to take over the entire area. When the request was not responded petitioner approached this court by filing a writ petition. This court passed Ext.P1 judgment in that writ petition directing the L.A. Officer to consider and dispose of the petitioner's request which had been produced as Ext.P4 in that writ petition. Pursuant to Ext.P1, petitioner's request was considered, but rejected vide Ext.P2 communication. Against the rejection of the petitioner's request based on second proviso to section 49 of the L.A. Act, the petitioner filed WP(C). No. 23225 of 2007 before this court seeking a direction to refer the question raised by the petitioner under the second proviso to section 49(1) to the civil court. Other directions were also sought for restraining taking possession of the property till the dispute is determined by the court. This court disposed of that writ petition by passing Ext.P3 judgment. Under Ext.P3 the petitioner was directed to WP(C)N0.13949/08 -4- file a petition claiming compensation for injurious affection as provided under clause thirdly of section 23(1) of the Land Acquisition Act before the L.A. Officer who was also directed to consider the application and dispose of the same in accordance with law within a time frame. In fact, under Ext.P3 this court virtually repelled the petitioner's case based on section 49(1), but held that he may be entitled for compensation for injurious affection under clause thirdly of section 23 (1). Petitioner complains that the directions in Ext.P3 judgment are yet to be complied with by the L.A. Officer. Petitioner submits that as he was awaiting compliance of Ext.P3, he would surprisingly receive Ext.P4 award notice dated 18-4-2008 informing him that award has been passed for a sum of Rs.51,17,153/- for his acquired property and that the amount is deposited under section 31(2) of the Act before the court. Ext.P5 produced by the petitioner is the Government Order dated 25-2-08 granting approval to a draft award under which the total compensation payable for the petitioner's acquired property is Rs.2,57,22,412/-. Therefore on receiving Ext.P4 petitioner submitted Ext.P6 representation before the Land Acquisition Officer objecting to Ext.P4. The petitioner refers to rule 10(2) of the Land Acquisition (Kerala) Rules and submits that a detailed valuation statement (DVS) WP(C)N0.13949/08 -5- and mahazar has been prepared in form No.8 as mandated by rule 10 (2) of the Land Acquisition (Kerala) Rules and that the total valuation made as per the same is Rs.2,42,23,955.86. Ext.P7 is copy of the DVS which has been approved by the District Collector. Petitioner points out that the statutory formality to be complied with after a DVS in the nature of Ext.P7 is prepared, is to issue notice to the interested parties in form No.9(b) as provided under section 9(3) of the Act. If objections are received from the interested parties, the same have to be enquired into by the acquisition officer who will then prepare draft award in form No.10 and submit the same with all connected records if the total amount exceeds Rs.2 crores, to the Government for approval in terms of rule 12(c). The above procedure was adopted in this case also and that is how Ext.P5 Government Order was issued. Petitioner contends that once approval is granted by the Government the award becomes final. The only remaining formality is issuance of notice in form No.10(b) (award notice) under section 12(2). The petitioner highlights the difference in the amount shown in Ext.P4 and in Ext.P5 and submits that absolutely no explanation is forthcoming as to why this difference has occurred. The petitioner then refers to section 11A of the Land Acquisition Act and submits that in terms of that section WP(C)N0.13949/08 -6- award has to be passed within a period of two years from the date of publication of the declaration under section 6 and if the award is not so passed the entire acquisition proceedings shall lapse. It is pointed out in this context that the last date of publication of the declaration under section 6 in this case was newspaper publication on 3-2-2006. Award therefore should have been passed on or before 3-2-2008 under section 11A. Since the award referred to in Ext.P4 is not the award which was approved by the Collector and the Government it has to be taken that the award in respect of which Ext.P4 has been issued was passed beyond the period of two years from the last date of publication of the declaration under section 6. That award is unenforceable and consequently the entire proceedings for acquisition has lapsed. Petitioner has also produced Ext.P8 copy of the notice in form nO.9(B) (notice under section 9(3). Petitioner has also produced the claim statement which was submitted by him pursuant to Ext.P8 as Ext.P9. Petitioner is relying on these two documents to contend that Ext.P5 Government Order is the award passed after undergoing all the statutory formalities and the award mentioned in Ext.P4 cannot be a valid award. The only award which is valid in the eye of law is the draft award which was sent for approval by the Government and the WP(C)N0.13949/08 -7- same is approved by the Government. 2. Exts.P10 and P10(a) are representations submitted by the petitioner for grant of compensation under a negotiated settlement which was made applicable to land owners in Kadamakudy and Thrikkakara North Village who are also affected by acquisition for the ICTT project. The petitioner is aggrieved in that those representations have not been considered so far. 3. Petitioner refers to rule 15 of the Land Acquisition (Kerala) Rules and submits that the authorities are bound to issue a notice in form No.12 for the purpose of taking over of possession of the acquired land which have to be served on all the parties interested in the land and intimation regarding the same shall be given to the requisitioning authority also in form No.13. In the instant case, such formalities have not been observed by respondents 2 and 3. However, hasty action, it is alleged, is being taken by the L.A. Officer for evicting the petitioner as well as for demolishing the structures standing on the property under the guise of taking over on the strength of the award notice. Compound wall has been substantially demolished and fruit bearing trees have been cut down. The action of the respondents is in violation of the directions in Ext.P3 and also the provisions in rule 15 of WP(C)N0.13949/08 -8- the L.A. (Kerala) Rules. The petitioner submits that pursuant to directions given to him for filling up the blanks on a surrender form, petitioner also filled up a surrender form unconditionally surrendering the land to the Government. According to the petitioner, he filled up the surrender form on the assurance given to him by the Special Tahsildar that he would be beneficiary under the “Negotiated Settlement Package” considered by the DLPC of which the District Collector is the Convener. Ext.P11 is copy of the surrender form. Petitioner submits that Ext.P11 is signed by him in his individual capacity and not on behalf of the company. Petitioner became constrained to sign Ext.P11 only because of the assurance of the L.A. Officer that he would be benefited by the package which was announced by the DLPC. It is subsequent to the filing of the writ petition that the petitioner was served with copy of the award which is produced as Ext.P12. According to the petitioner, Ext.P12 is inconsistent with the provisions of the Act and the Rules especially sections 11 and 12 read with rule 12(2) of the Land Acquisition (Kerala) Rules. As per Rule 12(a) it is obligatory that the L.A. Officer shall make award in form No.10 as soon as approval is received. This rule has been violated. There was no justifiable reason for reducing WP(C)N0.13949/08 -9- the amount of compensation. The alleged violation of the CRZ notification was never informed to the petitioner at any point of time. Resort started functioning in April 2002 and from that date till September 2005 when the notification under section 4(1) was issued neither CRZ Management Authority nor the Local Self Government Department had issued any notice to show cause as to why the constructions in the property should not be demolished. Therefore the alleged violation of CRZ notification cannot be a valid consideration for determining the compensation. Since extraneous considerations have influenced the determination of compensation under the award, the decision making process has become vitiated warranting interference by this court in judicial review. 4. The second respondent District Collector has filed a detailed counter affidavit. It is submitted that in Kadamakudy Village the petitioner owned 1.64.12 hectares of land and out of the said land only 0.4634 hectares of land come under the acquisition for ICTT Project. Four L.A.C. Cases were registered in respect of the aforesaid extent and four awards have been passed. Payments have been made against two awards while the amount due under two awards have been deposited before the court under section 31(2). The petitioner's WP(C)N0.13949/08 -10- request under section 49(1) for acquisition of his entire lands was rejected by the L.A. Officer pursuant to the directions in Ext.P1 judgment of this court. That order has become final. That order was not challenged even in WP(C). 23225 of 2007. The direction issued by this court in that writ petition was only to take a decision on the petitioner's application for compensation for injurious affection as provided under clause thirdly in subsection (1) of section 23. Pursuant to the directions in Ext.P3 judgment, petitioner's application was considered, but rejected. Ext.R2(a) is copy of the proceedings dated 16-4-2008 rejecting the petitioner's application. R2(a) will show that the petitioner's allegations that the directions in Ext.P3 have not been complied with are incorrect. R2(b) is copy of the acknowledgment issued by the petitioner showing his receipt of R2(a). The District Collector concedes that the draft award which was transmitted to the Government for approval as per rule 12(1) of the Land Acquisition (Kerala) Rules was for a sum of Rs.2,57,22,412/-. It is also conceded that the above draft award was approved by the Government. But in the meanwhile the Chairman of the Kerala Coastal Zone Management Authority intimated the District Collector, Ernakulam that the constructions carried out by the petitioner upon this 40.46 Ares of land WP(C)N0.13949/08 -11- coming under acquisition are illegal, since the same is in violation of CRZ notification 1991. Ext.R2(d) is copy of the communication dated 15-1-2008 received by the District Collector from the Department of Science and Technology. Subsequently by letter dated 25-1-2008 the National Highway Authority of India informed the District Collector that since the structures put up in the land are illegal constructions and therefor revised detailed valuation statement has to be taken deleting the cost of structures. The value of structures were deleted and the award was passed for an amount of Rs.51,17,053/-. It is this award which was passed on 18-4-2008. The award notice Ext.P4 under section 12(2) was issued in respect of the above award. The second respondent contends that the remedy available to a person who is aggrieved by an award is not to seek quashment of the award or the award notice but to claim redetermination of compensation under section 18 or Section 28A. The award amount was deposited in court since the petitioner did not produce the original document and there were claims from Tahsildar and KFC, Kottayam Branch. The next serious contention raised by the petitioner that a draft award which has been approved by the Government is as good as the award itself it is contended that Ext.P5 is not the award. A draft award becomes an WP(C)N0.13949/08 -12- award when the Government grants approval and only after the approval of the Government award is passed by the L.A. Officer. In this case, before the award was passed by the L.A. Officer the Coastal Zone Management Authority informed the District Collector that the structures which had been valued under the draft award were illegal being in violation of CRZ-1 notification. The NHAI also informed the District Collector on the basis of the CRZ authority's stand that a fresh detailed valuation will have to be taken. This is why the award came to be passed for an amount which is lesser than the amount shown in the draft award. The contention of the petitioner that after approval of the award the only formality remaining is issuance of notice in form No.10(b) is incorrect. Form No.10(b) is issued as contemplated under rule 12(2) of the Rules and the said rule contemplates that after approval an award has to be made and then one copy of the award is sent to the District Collector for making necessary changes in the revenue records and one copy shall be sent to the requisitioning authority. Section 12(2) mandates that the award notice shall be given to the person interested. Answering the grievance of the petitioner raised in the context of entitlement to compensation under the DLPC package it is contended that the petitioner was not at all co- WP(C)N0.13949/08 -13- operating with the authorities. Petitioner was moving from one court to another. Recently the petitioner filed O.S. 609 of 2008 before the Munsiff's Court, Ernakulam seeking permanent prohibitory injunction restraining the officials from demolishing the structures in the property in question. He has filed a temporary injunction application also. This material fact is not disclosed in the writ petitioner. He never came forward to accept the DLPC package. Hence the same was not given to him. Moreover his claim for more than 6 crores on account of future loss of business cannot be granted at any rate. Answering the question of limitation raised, the District Collector states in the counter affidavit that it is true that the award was passed only on 18-4-2008 which is more than two years from 3-2-2006, the date of section 6 declaration. But during the period from 16-8-07 till 25-3-2008 there was an interim order of stay in WP(C). No. 23225 of 2007 issued by this court against dispossession. The period covered by that interim order can be excluded from reckoning for the purpose of section 11A. Therefore the award is well within the statutory period. It is then pointed out that during the site inspection on 15-4-2008 it was noticed that the entire movable items and fixed fixtures such as electricity fittings, PVC Pipes, windows, doors, interior decoration etc. in the WP(C)N0.13949/08 -14- acquired building excluding the skeleton structure of the building were removed by the petitioner. The Managing Director of Kallarackal Resorts (P) Ltd. Sri.Roy Joseph gave consent to hand over the land and accordingly land was taken possession of by the Revenue Inspector and the land has been handed over to the NHAI. Since the Managing Director himself had given possession under his authorised signature there was no need for issuing form-12 (b) notice. On taking possession, compensation amount has been deposited in court. Therefore there is no violation of provisions of rule 15 of the L.A. Rules. Ext.P11 is photo copy of the surrender form which has been signed by the Managing Director Sri.Roy Joseph. The surrender form is valid. Against awards in two of the four L.A. cases registered in respect of the petitioner's property extending totally to 40.46 Ares the Managing Director himself has received two D Form Cheques for Rs.3,54,254/- and Rs.3,19,693/- respectively. 5. The petitioner has filed a detailed reply affidavit on 22-7- 2008. It is submitted therein that before formally inaugurating the resort the petitioner had obtained all statutory licences and permits. N.O.C. had been obtained from the Panchayat for the purpose of construction of the resort. After construction was over, Panchayat WP(C)N0.13949/08 -15- granted ownership certificate and thereafter Panchayat issued licence for running the restaurant and hotel located in an extent comprises 3.93 acres. Exts.P13 and P14 are copies of the NOC and licence issued by the Panchayat for period commencing from 2002- 03 upto 31-3- 2008. Petitioner has remitted the property tax due to the Panchayat for the buildings. Petitioner has produced Ext.P15 communication dated 8-2-2007 addressed by the Joint Director, Department of Tourism. Ext.P15 is to the effect that on account of acquisition of the property the entire remainder area will become non-hospitable and reduced to non-utility. The petitioner submits that since he did not desire to pursue the case pleaded under section 49 he did not find it necessary to challenge Ext.P2. But he contends that rejection of his application seeking compensation for injurious affection on the reason of communication from the CRZ Management Authority was not justified. Petitioner was never served with copy of this communication at any point of time during the entire proceedings for acquisition of the property culminating in Ext.P12 award. Therefore petitioner could not have challenged the communication evidenced by Ext.R2(c). Reiterating that the petitioner has not so far received any communication from CRZ authority at any point of time petitioner WP(C)N0.13949/08 -16- contends that the more important legal issue as far as he is concerned is the validity of the proceedings leading to Ext.P12. He reiterates that once draft award in form No. 12 is prepared and approved by the Government there is no necessity for the L.A. Officer to pass a fresh separate award. The only necessity going by the provisions contained in the Act and the Rules is what is provided under Rule 12(2) of the Land Acquisition (Kerala) Rules which stipulates that as soon as the approval is received the L.A. Officer shall make an award in form No.10 and send one copy of such award to District Collector for effecting necessary changes in the revenue records and one copy to the requisitioning authority. Petitioner contends that it has been clarified by the decision of the Apex Court that after the award is approved, if there is no alteration in the award, the Land Acquisition Collector is required to notify the parties concerned about the award. He may do so by fixing a date on which the parties may be required to appear for pronouncement of the award, or he may inform them by giving them written notice of the award. It is contended that no separate award is necessary once draft award is approved. Even if it is assumed that a separate award is necessary it is the duty of the L.A. Officer to have passed award in terms of Rules 12(1) and a12(2) of WP(C)N0.13949/08 -17- the Land Acquisition (Kerala) Rules. Petitioner points out that when there was labour unrest and related problems during the course of construction of the resort buildings he had to file writ petitions before this court seeking police protection. Exts.P16 and P17 are copies of the judgments in those writ petitions. It is pointed out that Government was also a party to this writ petition and no objection was raised by the Government against the construction of the resort. No litigation in connection with the construction of the resort was there either before this court or before any civil court. It is idle to contend on the basis of some communications not disclosed to the petitioner that the construction is in violation of CRZ norms. The communication of the CRZ authority relied on by the Government cannot be relied on at all in view of the violation of principles of natural justice as well as the procedure contemplated in the Act and the Rules for passing the award. It is pointed out that during the section 9(3) hearing also petitioner was informed about the alleged violation of CRZ norms. There is absolutely no bona fides in the stand of the Government. Petitioner contends that it is settled position in Administrative Law that a man cannot be permitted to take undue and unfair advantage of his own wrong to gain favourable interpretation of law. It was the WP(C)N0.13949/08 -18- statutory obligation of the L.A. Officer to have passed an award in