IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATIONS NOS. 10108/1994, 2716/1998, 4847/1992, 4733/1992, 4427/1992, 4153/1991, 4210/1985, AND 941/1980 WITH SPECIAL CIVIL APPLICATIONS NOS. 6461/1996, 6519/1998 8882/1999 AND 8885/1999 WITH SPECIAL CIVIL APPLICATION NO. 3537 OF 1995 For Approval and Signature: Hon'ble CHIEF JUSTICE MR DM DHARMADHIKARI and Hon'ble MR.JUSTICE J.M.PANCHAL ============================================================ 1. Whether Reporters of Local Papers may be allowed : YES to see the judgements? 2. To be referred to the Reporter or not? : YES 3. Whether Their Lordships wish to see the fair copy : NO of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? : NO -------------------------------------------------------------- PALITANA SUGAR MILL PVT LTD Versus STATE OF GUJARAT -------------------------------------------------------------- Appearance: 1. Special Civil Application No. 10108 of 1994 MR DR DHANUKA, SR. COUNSEL with MR PRASHANT G DESAI, MR ND NANAVATI, MR BH ANTIA, MR NA PANDYA, MR MANEK KALYANI for petitioners M/S PURNANAND & CO for Respondent No. 1 M/S THAKKAR ASSOC. for Respondent No. 2 MR JR NANAVATI for Respondent No. 3 RULE SERVED BY DS for Respondent No. 4 2. Special Civil Application No 2716 of 1998 MR BHUSHAN B OZA for Petitioners GOVERNMENT PLEADER for Respondent No. 1 MR JR NANAVATI for Respondent No. 3 MR ANANT S DAVE for Respondent No. 4 3. Special Civil Application No. 4847 of 1992 Mr. JR Nanavati for petitioners NOs. 1 and 2 Mr. Ajay R. Mehta for petitioener No.3 Mr. Prashant Desai for respondents Nos. 1 and 2 Mr. JD Ajmera for respondents Nos. 3 and 4 4. Special Civil Application No. 4733 of 1992 Mr. JR Nanavati for petitoiner M/s.P & Co. for respondent No.1 Mr. Prashant Desai for respondents Nos. 2 and 3 5. Special Civil Application No. 4427 of 1992 Mr. JR Nanavat for petitoiner M/s.P & Co. for respondent No.1 Mr. Prashant Desai for respondents Nos. 2 and 3 6. Special Civil Application No. 4153 of 1991 Mr. JR Nanavati for the petitioner Government Pleader for respondents Nos. 1 and 2 Mrs. KA Mehta for respondent No.3 Mr. PG Desai for respondent No.4 No.6 party in person 7. Special Civil Application No. 4210 of 1985 Mr. RJ Oza for petitoiner M/s. Patel Advocates Govt. Pleader for Respondent NO.3 Mr.SN Shelat Addl. Advocate General for respondent No.4 8. Special Civil Application No. 941 of 1980 Mr.KG Vakharia for petitoiner Mr.HV Chhatrapati for Respondents Nos. 1 to 7 Mr.PG Desai for respondent No.8 Mr.AJ Pandya for respondent NO.9 Mr.JR Nanavati for respondent NO.10 Mr.Haroobhai Mehta for respondent No.11 9. Special Civil Application No. 6461 of 1996 Mr.S.H.Sanjanwala Sr. Counsel with Mr.R.S.Sanjanwala for petitioner Mr.S.N.Shelat Addl. Advocate General for R-1 Mr. M.D.Pandya for R-2 Mr.B.P. Tanna for R-3 10. Special Civil Application No. 6519 of 1998 Mr.S.H.Sanjanwala Sr. Counsel with Mr.R.S.Sanjanwala for petitioner Mr.S.N.Shelat Addl. Advocate General for R-1 Mr. M.D.Pandya for R-2 Mr.B.P. Tanna for R-3 11. Special Civil Application No. 8882 of 1999 Mr.B.P.Tanna for Tanna Associates for petitioners Mr.S.N.Shelat, Addl. Advocate General for R-1 Mr.MD Pandya for R-2 Mr.YN Oza Sr. Counsel for Mr.SJ Mehta for R 3-36 12. Special Civil Application No. 8885 of 1999 Mr.R.R.Marshal for Peititioner Mr.SN Shelat Addl. Advocate General R-1 Mr.MD Pandya for R-2 Mr.YN Oza for R-3 13. Special Civil Application No. 3537 of 1995 Mr.M.C.Bhatt for petitioner Mr.MD Pandya for R-1 Mr. SN Shelat, Addl Advocate General for R-2 -------------------------------------------------------------- CORAM : CHIEF JUSTICE MR DM DHARMADHIKARI and MR.JUSTICE J.M.PANCHAL Date of decision:24/11/2000 C.A.V. JUDGEMENT (Per D.M. DHARMADHIKARI, C.J.) #. A common judgment, in this petition, and in group of petitions arising from Bhavnagar being Special Civil Applications Nos. 941 of 1980, 4210 of 1985, 2716 of 1998, 4153 of 1991, 4427 of 1992, 4733 of 1992 and 4847 of 1992, group of petitions arising from Surat being Special Civil Applications Nos. 8882 of 1999, 8885 of 1999, 6519 of 1998, 6461 of 1996 and a petition arising from Vadodara being Special Civil Application No. 3537 of 1998, is being passed. #. In this group of petitions arising from Bhavnagar, Surat and Vadodara, the petitioners in some of the cases, who are land owners, have claimed a declaration that the reservation of the lands belonging to them for educational purposes of University stand statutorily lapsed, entitling the land owners to use of those lands, for their benefit by development and construction, in accordance with other regulatory provisions of the Gujarat Town Planning and Urban Development Act, 1976 (for brevity, hereinafter referred to as `the Town Planning Act'). #. We shall take up first for decision the group of petitions arising from Bhavnagar in which common points have been urged, although, differently by the learned counsel appearing in those cases, on the provisions of the Town Planning Act. #. The present Special Civil Applications No. 10108 of 1994, 4210 of 1985 are petitions by the land owners, claiming a declaration that reservation of their lands by the Town Planning Authority lapses. Special Civil Application No. 2716 of 1998 is a public interest litigation. Special Civil Application No. 4427 of 1992 has been filed by the Bhavnagar University, seeking direction from this Court to the State Government and against the land owners that the lands in consideration deserve to be kept reserved for future need of the University. Special Civil Application NO. 4733 of 1992 is filed for the same purpose in support of the Bhavnagar University firstly by a Senate Member and a Student in a College affiliated to the University. Special Civil Application No. 941 of 1980 has been filed by Bhavnagar Municipal Corporation, claiming a direction against the Authorities and the land owners that the lands under consideration cannot be exempted under Section 20 and 21 of the Gujarat Urban Land (Ceiling and Regulation) Act, 1976 (for brevity, hereinafter referred to as `the ULC Act') which is now repealed in Gujarat by Urban Land (Ceiling and Regulation) Repeal Act, 1999 (for brevity, hereinafter referred to as `the Repealing Act, 1999'). Special Civil Application No. 4847 of 1992 has been filed by two citizens of Bhavnagar as Public Interest Litigation, against the land owners, restraining them from developing the land and using the same for construction of houses for the alleged weaker sections of the society. #. In substance, the main challenge made on behalf of the land owners to the action of the State and its Authorities under the Town Planning Act, is that for the period much longer than ten years, the land reserved having not been acquired from the land owners under the provisions of Land Acquisition Act, 1894 (for brevity, hereinafter referred to as `the Acquisition Act') and failure of the Authorities to acquire it even after service of an express notice and within the prescribed period in accordance with sub-section (2) of Section 20 of the Town Planning Act, the designation or reservation of the lands lapses, entitling the land owners to a right to freely use the land in accordance with the general restrictions under the local laws. #. Shorn of unnecessary details, factual background, briefly, may be stated as under: By a registered sale deed executed on 30-3-1971, the petitioner Palitana Sugar Mills Private Limited purchased land bearing Survey Nos. 469/1, 470/1, 471/2, 471/3 and 472 of village Vadva, Taluka and District Bhavnagar admeasuring about 930 acres and 4 gunthas from the family members of the erstwhile Ruler of Bhavnagar State. #. A Development Plan prepared by Bhavnagar Municipal Council was sanctioned under Section 17(1)(c) of the Town Planning Act by the State Government on 8-11-1985 and it was brought into force from 1-1-1986. Since the period of ten years had lapsed from the date of the coming into force of the final Development Plan and proceedings under the Land Acquisition Act were not commenced within such period in accordance with sub-section (2) of Section 20 of the Town Planning Act, the petitioners served a notice on the Authorities requiring them to acquire the land within six months from the date of service of such notice. The petitioners' case is that period of ten years and 6 months available for acquisition having been completed and the Authorities having failed to acquire or take any steps for acquisition of the land, the designation or the reservation of the land for the University purposes lapses, entitling the petitioners to the grant of relief of releasing of the land in their favour for development by them in accordance with law. #. The alternative submission made on behalf of the land owners is that the University has no financial capacity to acquire the land and in fact its need has been fulfilled as an alternative land aggregating 200 acres has been allotted to them by the State Government which fact has not been disputed. An attempt on the part of the State Government and the University to again reserve the land by issuance of a Draft Revised Development Plan on 27-12-1995 is prima facie malafide and an abuse of statutory powers. It is again proposed to be reserved with an oblique purpose to deprive the land owners of the use of their lands, resulting in breach of their fundamental right of carrying on their trade and business by unrestricted use of the land owned by them. #. On behalf of the State Government the stand taken is that provision continued in Section 20(2) enabling service of notice by land owners for acquisition within six months on expiry of ten years period from the date of Final Development Plan, does not come into operation, where, the Final Development Plan is in the process of revision under Section 21 of the Town Planning Act, read with Sections 9 to 20 of the Act. It is pointed out on behalf of the State Government that the Final Development Plan which came into force on 1-1-1986 is under revision in accordance with Section 21 of the Town Planning Act with issuance of Draft Revised Development Plan on 27-12-1995, in which certain lands belonging to the petitioners continued to be shown as reserved for the purposes of University. ##. The petition filed by the land owners has been opposed on the stand taken by the State Government as also on other grounds (which we shall deal with separately) by Bhavnagar University, its Senate Member, and student who have filed separate petitions. A few citizens of Bhavnagar by Public Interest Litigation have also opposed the claim of the land owners. There is also a petition filed by Bhavnagar Municipal Corporation raising certain different grounds on the exemption of the land from the provisions of the ULC Act (now repealed). ##. We shall first take up for consideration the arguments advanced by the learned Sr. Counsel Shri Dhanuka, appearing for the land owners, the Additional Advocate General Shri S.N. Shelat for the State and Shri J.R. Nanavaty, for the University on the interpretation and legal effect of the provisions of Section 20 of the Town Planning Act. ##. Since the main question raised before us is of the interpretation of the provisions of Section 20 of the Town Planning Act, it would be necessary to briefly survey the relevant provisions of the Town Planning Act. ##. As the preamble of the Town Planning Act indicates, it is "an Act to consolidate and amend the law relating to making and execution of development plans and town planning schemes in the State of Gujarat". In accordance with Section 1(3), by Notification issued by the Government, it is brought into force in the State of Gujarat, with effect from 1-2-1978. Section 2 contains the definition clause and the relevant definition in sub-clause (x) defines "development plan" to mean `a plan for development or redevelopment or improvement of a development area'. Under Section 3, for the purpose of planned development, the State Government may by Notification specify the development areas. Under Section 4, the State Government by Notification, may exclude the whole or part of a development area from operation of the Act. Under Section 5, provision is made for constitution of "Area Development Authorities", consisting of Nominees of the Government and Local Authorities, as specified therein. Under Section 6, the Government is empowered to designate any Local Authority functioning in the development area as an Area Development Authority, instead of constituting a Development Authority. Section 7, contains the powers and functions of Area Development Authority, which amongst others include, preparation of Development Plan, Town Planning Schemes and to control the development activities. The other relevant Section 9 provides that "not later than three years after the declaration of such area as a development area or within such time as the State Government may, from time to time, extend, the authority shall prepare and submit to the State Government, a draft development plan, for the whole or any part of the development area". On the failure of development authority to prepare such a plan, the State Government has to prepare a development plan within the period of three years. Under Section 10, the draft development plan has to be kept open for public inspection. Section 12, in its relevant sub-clauses containing provisions showing the contents of draft development plan, deserves to be reproduced, for deciding points raised in this batch of petitions: "Contents of draft development plan. (1) A draft development plan shall generally indicate the manner in which the use of land in the area covered by it shall be regulated and also indicate the manner in which the development therein shall be carried out. (2) In particular, it shall provide, so far as may be necessary, for all or any of the following matters, namely:- (a) x x x x x x (b) proposals for the reservation of land for public purposes, such as schools, colleges and other educational institutions, medical and public health institutions, markets, social welfare and cultural institutions, theatres and places for public entertainment, public assembly, museums, art galleries, religious buildings, playgrounds, stadia, open spaces, dairies and for such other purposes as may, form time to time, be specified by the State Government; (c) x x x x x x (d) transport and communications, such as roads, highways, parkways, railways, waterways, canals and airport, including their extension and development; (e) x x x x x x (f) reservation of land for community facilities and services; (g) x x x x x x (h) x x x x x x (i) x x x x x x (j) x x x x x x (k) proposals for the reservation of land for the purpose of Union, any State, local authority or any other or body established by or under any law for the time being in force; (l) x x x x x x (m) x x x x x x (n) provision for preventing or removing pollution of water or air caused by the discharge of waste or other means as a result of the use of land; (o) such other proposals for public or other purposes as may from time to time be approved by the area development authority or as may be directed by the State Government in this behalf." ##. Section 13 requires publication of draft development plan, for the purpose of inviting suggestions and objections from public and affected parties. Under Section 14, the suggestions are required to be considered, and under Section 15, necessary modifications may be made in the draft development plan. The modified draft development plan has to be submitted to the State Government for sanction. Under Section 17, the State Government may sanction the draft development plan with further modifications, as deemed necessary, and after publishing the same again, for inviting suggestions and objections in the Official Gazette. ##. In sub clause (d) of sub-section (1) of Section 17, the sanction accorded to the draft development plan by the State Government shall be notified in the Official Gazette, and on such sanction, it shall be called "the final development plan", which shall come into force from a date to be notified, which shall not be not earlier than one month from the date of publication of such sanction. Sub-section (2) of Section 17 requires the State Government to observe certain precautions with regard to the reservation of land for specific purposes mentioned in Section 12, but, only on the satisfaction that the land, so reserved, is likely to be acquired within ten years from the publication of final development plan. Sub-section (2) of Section 17 deserves to be quoted in full, as some arguments were advanced on its scope and effect:- "17(2) Where the draft development plan submitted by an area development authority or, as the case may be, the authorised officer contains any proposals for the reservation of any land for a purpose specified in clause (b) or clause (n) or clause (o) of sub-section (2) of Section 12 and such land does not vest in the area development authority, the State Government shall not include the said reservation in the development plan, unless it is satisfied that such authority would acquire the land, whether by agreement or compulsory acquisition, within ten years from the date on which the final development plan comes into force." ##. Under Section 18, the State Government has been empowered even to amend the final development plan, by extending or reducing its area. Under Section 19, the State Government is empowered to vary the final development plan, but, only after inviting suggestions and objections in the manner laid down in the said Section. Section 20 provides for acquisition of land designated or reserved for specified purposes mentioned in Section 12, and the said Section is before us for proper interpretation, and therefore, the same is reproduced in full: "Sec.20. Acquisition of land. (1) The area development authority or any other authority for whose purpose land is designated in the final development plan for any purpose specified in clause (b), clause (d), clause (f), clause (k), clause (n) or clause (o) of sub-section (2) of section 12, may acquire th eland either by agreement or under the provisions of th eland Acquisition Act, 1894, I of 1894. (2) If the land referred to in sub-section(1) is not acquired by agreement within a period of ten years from the date of the coming into force of the final development plan or if proceedings under the Land Acquisition Act, 1894 I of 1894, are not commenced within such period, the owner or any person interested in the land may serve a notice on the authority concerned requiring it to acquire the land and if within six months from the date of service of such notice the land is not acquired or no steps are commenced for its acquisitions, the designation of the land as aforesaid shall be deemed to have lapsed." [Underlining for supplying emphasis] ##. For proper construction of Section 20 quoted above, the most relevant Section, which also has to be interpreted harmoniously with other provisions is Section 21, authorising revision of final development plan, at least once in ten years. Section 21 of revision of development plan also deserves to be quoted in full: "Sec.21. Revision of development plan. Atleast once in ten years from the date on which a final development plan comes into force, the area development authority shall revise the development plan after carrying out, if necessary, a fresh survey and the provisions of sections 9 to 20, shall, so far as may be, apply to such revision." ##. The other provisions of the Act contained in Chapter III for constitution of urban development areas, control of development and use of land in Chapter IV and Chapter V containing town planning schemes etc, being not directly relevant, are not being dealt with or quoted. ##. Learned Sr. Counsel Shri Dhanuka appearing for the land owners, in cases arising from Bhavnagar, has raised the following contentions: ##. Firstly, it is contended that Section 20(1) and Section 20(2) of the Town Planning Act are mandatory. No steps whatsoever were taken by the Bhavnagar University or by the State Government for acquisition of the land of the petitioner which was reserved. No proceedings were commenced for acquisition, within a long period of ten years from 1-1-1986 i.e. the date, when final development plan was brought into force. No action for acquisition was taken within six months notice period, in accordance with subsection (2) of Section 20. This inaction on the part of the authorities showed that there was no need of the petitioners land for the specified purpose for which it was reserved. It also shows that no funds were available for acquisition and making payment of the market value of the petitioners lands. ##. It is next urged that by this time, due to total inaction on the part of the authorities of the State and the Bhavnagar Development Authority as also the University, the petitioners' lands stand unlawfully freezed with no utility to the petitioners for a long period of 37 years. It is submitted that reservation of land cannot be made for an indefinite period of time, and exercise of such power of reservation amounts to fraud on exercise of power. On the above contentions, it is submitted that on expiry of ten years period from the coming into force of the final development plan, and thereafter, inability of the authorities to acquire the land within six months from the date of service of notice for acquisition by the petitioners, the statutory result, as provided in subsection (2) of Section 20 of the Act, is dereservation of the land designated for particular specified use or purpose, and entitlement to grant of relief to the petitioners of restoration of said land for development by them, in accordance with law. Strong reliance has been placed on the decision of Supreme Court in the case of Municipal Corporation of Greater Bombay vs. Dr. Hakim Vad Tenants Association and others AIR 1988 SC 233, decision of learned Single Judge Justice M.R. Calla, J of this Court in the case of Bhikubhai Shyamaldas Patel v. State of Gujarat (1995) 36(2) GLR 1694. Another decision of learned Single Judge Justice Rajesh Balia of this Court (as he then was) in Heirs and Legal Representatives of Prabhudas Ramdas Patel v. Ahmedabad Municipal Corporation AIR 1999 Guj 98. Reliance is also placed on Division Bench decision of High Court of Bombay, (Aurangabad Bench) in Madhav Raghunath Thatte v. Director Town Planning, Maharashtra State 1998 BLR 118, Walter John Duming Alvaris v. State of Maharashtra 1997 BLR 577 and unreported decision of learned Single Judge Justice A.P. Shah of Bombay High Court in Writ Petition No. 641 of 1996 decided in September 1996 (of which a copy was supplied to the Court). Learned counsel for the petitioner concludes by saying that only by proposing to revise the final development plan under Section 21 of the Act and initiating proceedings for the same, the statutory effect of dereservation of land on the failure of the authorities to acquire it in ten years and thereafter within the six months notice period, cannot be avoided. ##. Learned Additional Advocate General appearing for the State opposed the petitions of the land owners on contentions, inter alia, that undoubtedly the period of ten years provided for acquisition of the land reserved under Section 20(1) has long back expired and acquisition was also not made within the six months notice period, nonetheless, the reservation of the land would not lapse as the concerned urban development authority has issued a draft revised development plan under Section 21 of the Act for sanction of the State Government. The provisions of Section 20(2), therefore, stand arrested and the reservation or designation of the land for the purpose specified would not lapse. It is argued that Section 21 is an enabling Section. It enjoins the