THE HON’BLE Ms. JUSTICE G. ROHINI WRIT PETITION No.27030 OF 2006 Dated: 30.12.2009 Between 1. Indo-American Super Specialities Limited, Rep. by its Director, Dr. K. Sivaramakrishna, Having its registered office at 5-87-129, Main Road, Lakshmipuram, Guntur., and another. … Petitioners And 1. The District Collector (Land Acquisition), Guntur District, Guntur., and 4 others. … Respondents THE HON’BLE Ms. JUSTICE G. ROHINI WRIT PETITION No.27030 OF 2006 ORDER : This writ petition is filed aggrieved by the proceedings initiated under the Land Acquisition Act, 1894 for acquisition of the land belonging to the petitioners to an extent of 6,261.06 sq. yards situated in Block No.7, NTS, 568/2 in Guntur Town. The essential facts are as under: The 1st petitioner is a Company registered under the Indian Companies Act with an objective to provide Super-specialty medical services to the general public in Guntur District. For the said purpose, the 1st petitioner company acquired an extent of 4,126 Sq. yards of land situated in TS.Nos.567 and 568, Block No.VI, Ward No.5 of Guntur belonging to the Endowments Department in a public auction conducted on 2.9.2002 at the rate of Rs.7,500/- per sq. yard under two Registered Sale Deeds. Since the said land has no approach road, the 1st petitioner company has also purchased another piece of land together with dwelling houses bearing Nos.12-29-21, 12-29-49 and 12-29-51 under two separate sale deeds. Having developed the entire site spending about Rs.15 lakhs, the petitioners applied for building permission and also for change of land use by paying the requisite fees. While the applications of petitioners are pending with the respondent No.4, the 1st respondent - District Collector, Land Acquisition, Guntur - vide notification dated 2.12.2005 published under Section 4(1) of the Land Acquisition Act, 1894 (for short, ‘the Act’) proposed to acquire the 1st petitioner’s land to an extent of 6,261 sq. yards situated in T.S.No.568/2 for a public purpose viz., construction of Citizen Service Centre by the 4th respondent – Vijayawada – Guntur – Tenali – Mangalagiri Urban Development Authority (for short, VGTM UDA). Having invoked the urgency clause under Section 17 (4) of the Act, the enquiry under Section 5-A of the Act was also dispensed with. Challenging the said action, the 1st petitioner herein filed W.P.No.26071 of 2005. Having taken note of the submission made by the learned Advocate General appearing on behalf of the respondents that the Land Acquisition Officer was advised to conduct Section-5A enquiry, the said writ petition was disposed of by this Court by order dated 30.12.2005 granting liberty to the petitioners to submit their objections for the proposed acquisition of the land. Thereafter, the 2nd respondent by notice dated 16-1-2006 invited objections from all the persons interested in the land sought to be acquired. However, the 1st petitioner’s request to provide copies of certain documents to enable them to effectively participate in the enquiry was rejected on the ground that the document sought by the 1st petitioner related to internal correspondence. Aggrieved by the same, the petitioners filed W.P.No.4118 of 2006. This Court disposed of the said writ petition by order dated 16.03.2006 directing the 2nd respondent to furnish the document in question within a period of one week and till then status quo as on that date shall be maintained. Though the respondents 1 and 2 preferred W.A.No.463 of 2006 the same was dismissed by judgment dated 27.04.2006. Pursuant thereto, the 2nd respondent – Special Deputy Collector (Land Acquisition), VGTUM UDA – by notice dated 27.09.2006 issued under Section 5-A of the Act called upon the petitioners to submit their objections and to appear for the personal hearing. Accordingly, objections on behalf of the 1st petitioner were filed on 18.11.2006 before the 2nd respondent. Thereafter, the 1st respondent – District Collector (Land Acquisition) – by proceedings dated 6.12.2006 while overruling the objections raised by the petitioners approved the draft declaration proposals and ordered publication under Section 6 of the Act. On the very next day i.e., 7.12.2006, the declaration under Section 6 of the Act was published in the District Gazette followed by notice dated 11.12.2006 issued under Sections 9 (3) and 10 of the Act for award enquiry. Aggrieved by the said action of the respondents, the present writ petition is filed seeking a declaration that the notification under Section 4 (1) of the Act dated 2.12.2005 as well as the proceedings of the 1s t respondent dated 6.12.2006 and consequential declaration under Section 6 of the Act dated 7.12.2006 are arbitrary, illegal and vitiated by mala fides apart from being violative of the principles of natural justice. It is primarily contended by the petitioners that the enquiry held under Section 5-A of the Act was illegal and in violation of the principles of natural justice. It is alleged that the petitioners were not given an opportunity of personal hearing and more over the report of the 2nd respondent dated 1.12.2006 which formed the basis for the proceedings of the 1st respondent dated 6.12.2006 was not furnished to them. It is also contended that the 1st respondent while approving the draft declaration proposals had failed to apply his mind to the objections raised by the petitioners with regard to the requirement and suitability of the land in question and misdirected himself to the issue and therefore the proceedings dated 6.12.2006 and the consequential declaration dated 7.12.2006 are liable to be declared as illegal. It is further contended that the 1st respondent’s proceedings dated 6.12.2006 were opposed to the material available on record, especially the report of the 2nd respondent dated 1.12.2006 wherein it was found that suitable alternative lands were available. It is also alleged that the impugned acquisition proceedings are vitiated by mala fides since the proceedings have been initiated out of political motives in order to deprive the petitioners of their valuable site purchased for constructing a hospital. In the counter-affidavit filed on behalf of the respondents 1 to 3, the petitioner’s allegation that no proper opportunity was given in the enquiry conducted under Section 5-A of the Act has been categorically denied. The mala fides alleged in the writ petition have also been specifically denied. While contending that the petitioners were informed every date of hearing in the enquiry under Section 5-A of the Act and that their Counsel had attended the enquiry, the details of the notices served on the petitioners from time to time from 12.01.2006 onwards have been furnished in detail in paras-5 & 6 of the counter-affidavit. Though the fact that the petitioners submitted their objections on 18.11.2006 and thereafter no further enquiry was held is not disputed, it is explained that the petitioners were informed that personal hearing was fixed on 18.11.2006 and on that day the advocate for the petitioners attended the enquiry and filed written objections. Thus, it is contended that the allegation of the petitioners that no opportunity of personal hearing was given is absolutely false and without any basis. A separate counter-affidavit has been filed on behalf of the 4th respondent – VGTM UDA – stating that the petitioners applied for permission to construct a superspeciality hospital by paying the necessary fee apart from the development charges. It is also stated that their request for change of land use is pending with the Government. It is further stated that since the land proposed for acquisition is centrally located and is nearer to Bus-stand and Railway Station, it is suitable for setting up Citizen Service Centre. Though the fact that the petitioner purchased the land in question in a public auction conducted by the Endowments Department has not been disputed, it is contended that since the enquiry under Section 5-A of the Act was properly conducted and the declaration under Section 6 was made after considering all the objections raised by the petitioners, the interference by this Court is not warranted. I have heard the learned counsel for both the parties and perused the material on record. The learned Senior Counsel appearing for the petitioners while relying upon the decision in STATE OF GUJARAT & OTHERS v. AMBALAL HAIDERBHAI[1] and M.PADMANABHA IYENGAR v. THE GOVERNMENT OF ANDHRA PRADESH AND OTHERS[2] contended that since the enquiry under Section 5-A of the Act was not held in conformity with the principles of natural justice and moreover since the 1st respondent while rejecting the objections of the petitioners had failed to apply his mind to the availability of the alternative suitable lands for acquisition, the entire decision making process was vitiated. On the other hand, the learned Special Government Pleader appearing for the respondents while submitting that the Courts will not sit in judgment over the opinion of the authority with regard to the suitability/preference of a land, vehemently contended that the 1st respondent’s conclusion that no other alternative suitable land is available warrants no interference by this Court. The learned Government Pleader further contended that the enquiry under Section 5-A of the Act, not being a quasi judicial enquiry, the impugned proceedings cannot be held to be vitiated in the absence of any plea or proof of prejudice caused to the petitioners on the ground of violation of principles of natural justice. The learned Government Pleader also contended that since the public purpose is not in dispute and the decision making process under Section 5-A of the Act has already culminated in Section 6 declaration, it is not amenable for judicial review unless it is established that the 1st respondent’s proceedings dated 06.12.2006 suffered from illegality, irrationality or procedural impropriety. In support of his contention, the learned Government Pleader relied upon the decision of the Supreme Court in HINDUSTAN PETROLEUM CORPN. LTD. v. DARIUS SHAPUR CHENAI[3]. At the outset, it is to be noticed that though mala fides were alleged in the writ petition against the 5th respondent, during the course of arguments the learned counsel for the petitioners submitted that the petitioners were not pressing the plea of mala fides. Since the plea of mala fides is given up by the petitioners, the learned Government Pleader appearing for the respondents contended that the impugned declaration under Section 6 of the Act, which is the conclusive evidence that the land in question is needed for a public purpose warrants no interference in exercise of the judicial review under Article 226 of the Constitution of India. It is true that Section 6 (3) of the Act renders a declaration to be a conclusive evidence with regard to the public purpose and the jurisdiction of the Court to interfere at that stage is limited. However, having regard to the fact that an opportunity of being heard has been expressly conferred under Section 5-A of the Act, the relief cannot be refused to the petitioner where the non-compliance with the provisions of Section 5-A of the Act is established. As held in MUNSHI SINGH v. UNION OF INDIA[4], Section 5-A embodies a very just and wholesome principle that a person whose property is being or is intended to be acquired should have a proper and reasonable opportunity of persuading the authorities concerned that acquisition of the property belonging to that person should not be made. In UNION OF INDIA v. MUKESH HANS[5], the Supreme Court further held that the limited right given to an owner/person interested under Section 5-A of the Act to object the acquisition proceedings is a substantive right but not an empty formality. It is also a well settled principle of law that such an opportunity of being heard provided under Section 5-A of the Act is necessary to be granted not only to show that the purpose for which the acquisition proceedings is sought to be made is not a public purpose but also to show the suitability of the land therefor. In HINDUSTAN PETROLEUM CORPN. LIMITED’S case (3 supra) while dealing with the scope of enquiry under Section 5-A of the Act, the Supreme Court observed as under : The conclusiveness contained in Section 6 of the Act indisputably is attached to a need as also the purpose and in this regard ordinarily, the jurisdiction of the court is limited but it is equally true that when an opportunity of being heard has expressly been conferred by a statute, the same must scrupulously be complied with. For the said purpose, Sections 4, 5-A and 6 of the Act must be read conjointly. The court in a case, where there has been total non-compliance or substantial non-compliance of the provisions of Section 5-A of the Act, cannot fold its hands and refuse to grant a relief to the writ petitioner. Sub-section (3) of Section 6 of the Act renders a declaration to be a conclusive evidence. But when the decision making process itself is in question, the power of judicial review can be exercised by the court in the event the order impugned suffers from well-known principles, viz., illegality, irrationality and procedural impropriety. Moreover, when a statutory authority exercises such enormous power it must be done in a fair and reasonable manner. In the instant case, the impugned acquisition is to construct a Citizen Service Centre to accommodate 26 Government Offices in Guntur town. It is not in dispute that the proceedings were initiated on a request made by VGTM UDA, Vijayawada. The Collector & District Magistrate, Guntur issued the notification dated 2.12.2005 under Section 4 (1) of the Act. The material on record shows that by letter dated 9.1.2006 the 1st respondent authorized the 2nd respondent - Special Deputy Collector (LA), VGTUM UDA, Vijayawada - to conduct enquiry under Section 5-A of the Act. Pursuant thereto, the 2nd respondent issued the notice dated 27.9.2006 under Section 5-A of the Act inviting all persons interested in the land to lodge a statement in writing of their objections. Such objections on behalf of the petitioners were filed before the 2nd respondent on 18.11.2006 through their advocate. Even according to the version of the respondents, no hearing took place on 18.11.2006. However, the 2nd respondent submitted his report dated 1.12.2006 and while referring to the said report, the 1st respondent by proceedings dated 6.12.2006 overruled the objections raised by the petitioners and ordered publication of the declaration under Section 6 of the Act. Accordingly, Section 6 declaration was published in the District Gazette on 7.12.2006. Having regard to the rival contentions raised by the parties, the question that arises for consideration is whether the impugned acquisition proceedings are vitiated and liable to be declared as illegal being contrary to the mandatory provisions of the Act. It is primarily contended by the petitioners that there had been a total non-application of mind on the part of the 1st respondent in initiating the impugned proceedings and particularly while rejecting the objections raised by the petitioners under Section 5-A of the Act. It is also contended that the denial of fair and reasonable opportunity of being heard to the petitioners resulted in total non-compliance with the mandatory provisions of Section 5-A of the Act and therefore it is a fit case to quash the acquisition proceedings in exercise the power of judicial review. At the outset, it is necessary to notice that one of the important objections raised by the petitioners is that mere suitable alternative lands are available in the vicinity and therefore there is no need to acquire the 1st petitioner’s lands. It would be appropriate to extract the said objection as under : “5(a) There have been alternate lands within hundred meters vicinity of this land admeasuring 14,000 sq. yards belong to Sri Yadavallivari Choultry (Endowment Department) in Sy.No.541 and 542 of Kothapeta, Guntur. The land of Sri Yadavallivari Choultry is situated within the same locality, Choultry land is a compact square piece and bounded by 70’ road on one site. This land was proposed to be leased out to Kothapeta Cloth Merchants Association for construction of commercial complex on 50:50 sharing. The part of the proposed commercial complex which falls under Endowments Department is meant for providing accommodation to the Government Offices and other allied bodies. Thereafter the Government accorded permission vide G.O.Ms.No.327, dated 12.6.2002 to the Government for change of land use from Residential to Commercial. In the said proposal, it was specifically stated that this land is abutting a 70’ wide road on West and 15’ wide road on East. There is a proposal to have 60’ road at Western side. The area adjacent to the land is already developed commercially. The Government accorded permission. 5 (b) It is pertinent to mention here that the local MLAs like Mohd. Jani and Sri Jaya Rambabu, R. Srinivasa Rao etc., recommended for construction of commercial complex in this premises for Government use and as well as for the use of Cloth Merchants Association. A three member committee constituted by the Commissioner of Endowments has also recommended for such proposal. When there is proposal to construct Commercial Complex meant for providing accommodation to the Government offices and such land is found suitable in all respects, there is no necessity to acquire the present land within the same locality for similar purpose. In any event, the Government issued G.O.Ms.No.363, dated 23.3.2006 cancelling the permission granted in favour of the Cloth Merchants Association. Now the land of Sri Yadavallivari Choultry is available for acquisition. The reasons assigned for cancellation of permission is that the procedure as contemplated under Section 80 of the Endowments Act had not been followed before granting permission and not for other reason.” The 2nd respondent who conducted the enquiry found that the petitioner’s plea as to the availability of another suitable land admeasuring 14,345 sq. yards belonging to Endowments Department is correct. It was also found by the 2nd respondent that though an extent of 7,945 sq. yards out of the above said land was allotted for construction of a shopping complex by Guntur Cloth Merchants Association vide G.O.Ms.No.327, dated 12.6.2002, subsequently the said allotment was cancelled vide G.O.Ms.No.363, dated 23.3.2006 on the ground that the allotment was contrary to the provisions of Section 80 of the A.P. Charitable and Hindu Religious Institutions and Endowments Act, 1987 (for short, ‘the Endowments Act’). However, it was observed that in view of the prohibition under Section 80 of the Endowments Act, the sale should be only in open auction. It was further observed that an interim order passed by this Court dated 7.6.2005 in W.P.No.11812 of 2005 restraining such alienation of Endowment lands was in operation. However, without properly appreciating the said report dated 01.12.2006, the 1st respondent concluded that the objections raised by the petitioners were baseless and accordingly passed the impugned proceedings dated 6.12.2006 directing publication of Section 6 declaration. It would be appropriate to extract the operative portion of the 1st respondent’s order dated 6.12.2006 as under : “The enquiry conducted by the Land Acquisition Officer & Special Deputy Collector (L.A.) VGTM UDA U/S. 5-A of the Act together with D.D. Proposals furnished thereon have been examined. The proposals are strictly in accordance with the provisions of L.A. Act, 1894 and under in accordance with the orders passed by the Hon’ble High Court of A.P. The land in question is quite suitable for construction of Citizen Service Centre for the free and fair access to the public. More over no other alternative suitable land is available in the locality. In the light of the above circumstances and keeping in view the recent judgment delivered by the Hon’ble High Court of A.P. in W.P.No.23060 of 2006, dated 29.09.2006 and batch; I am of the view that it is just and proper to acquire the lands in question for purpose of construction of Citizen Service Centre in the interest of public. Hence, I agree with the observations/report of the Land Acquisition Officer & Special Deputy Collector (L.A.) VGTM UDA in the matter and all objections raised by the objectioners are hereby overruled as they are baseless. Accordingly, I hereby approve the proposals and order for publication of Draft Declaration in the matter. The Land Acquisition Officer & Special Deputy Collector (L.A.) VGTM UDA, Vijayawada is directed to publish the notification in two daily news papers before publishing the substance of the notification at convenient places in the locality and report the date of publication forthwith.” As could be noticed from the above order, the 1st respondent did not take into consideration the specific finding of fact recorded by the 2nd respondent as to the availability of alternative suitable land in the vicinity. It is also clear that the 1st respondent’s conclusion that no other alternative suitable land was available in the locality was not supported by any reasons and there was no reference to any other material which formed the basis for the said conclusion. Since the 2nd respondent in his report dated 1.12.2006 found that alternative suitable lands are available, the 1st respondent ought to have considered whether it is feasible to acquire the said lands. It is also necessary for him to consider whether the interim order passed by this Court in W.P.No.11812 of 2005 and the prohibition under Section 80 of the Endowments Act would come in the way for acquiring the alternative land. Strangely, the 1st respondent did not apply his mind to any of the above aspects and merely jumped at a conclusion that the land in question was quite suitable for construction of Citizen Service Centre and that no other alternative suitable land was available in the locality. That apart while concluding that it was just and proper to acquire the lands in question, he had relied upon a totally irrelevant judgment of this Court in W.P.No.23060 of 2006 and batch dated 29.9.2006. It is to be noticed that in W.P.No.23060 of 2006 and batch the question that fell for consideration before this Court was whether the Revenue Divisional Officer who was authorized under Section 3 (c) of the Act to conduct enquiry under Section 5-A of the Act was competent to reject the objections. Having considered the scope and object of Section 5-A of the Act, this Court by common judgment dated 29.09.2006 held that the limited power given to the Revenue Divisional Officer under Section 5-A of the Act was to submit a report to the District Collector and that the District Collector alone was competent to take a decision on the objections raised by the owners. Thus it is clear that the said judgment in W.P.No.23060 of 2006 and batch is totally irrelevant for the purpose of deciding the objection that in view of the alternative land available in the vicinity, the acquisition of the petitioner’s land is not necessary. Apparently, the 1st respondent failed to apply his mind to the relevant factors and misdirected himself to the issue. The very approach of the 1st respondent being contrary to the object sought to be achieved by holding the enquiry under Section 5-A of the Act, I find force in the contention of the petitioners that the entire decision making process culminating in Section 6 declaration is vitiated. It is true that in a catena of decisions it was declared by the Courts that the declaration under Section 6 of the Act need not contain reasons. However, consideration of the objections raised by the owner of the land under Section 5-A of the Act and the order passed thereon by the Government must precede a proper application of mind to the material available on record and when the validity of Section 6 is challenged, it is for the State to satisfy the Court that the power conferred under the Statute has been exercised in a fair and reasonable manner. Section 5-A of the Act as it is applicable to the State of Andhra Pradesh runs as under: 5-A : Hearing of objections:- (1) Any person interested in any land which has been notified under Section 4, sub-section (1), as being needed or likely to be needed for a public purpose or for a Company may, within thirty days of causing public notice under the said sub-section, object to