THE HON’BLE SRI JUSTICE NOOTY RAMAMOHANA RAO W.P.No. 18646 OF 2006 AND W.P.No.4649 OF 2007 COMMON ORDER: Writ Petition No.4649 of 2007 has been instituted by 70 employees of the erstwhile M/s Parke- Davis (India) Limited, a pharmaceutical company, which was taken over by M/s Pﬁzer Limited, yet another multi- national pharmaceutical company. Writ Petition No. 18646 of 2006 has been instituted by Parke-Davis Employees’ Union, which is a trade union. The essential grievance espoused in both the writ petitions concerns the permission accorded by the Andhra Pradesh Industrial Infrastructure Corporation, a Government of Andhra Pradesh enterprise, to the 3rd respondent – Pﬁzer Limited to sell oﬀ the land of an extent of Ac.36.00 forming part of Plot No. 6, Industrial Estate situated in Survey No.1 of Uppalkalan. The apprehension entertained by the petitioners in turn centers around the fact that the new purchaser of the land is intending to put the same for commercial purposes but not for industrial use and thus, the very objective for which the State Government has utilized its resources for promotion of industrial growth is put to peril. The writ petitioners in both the cases have been forthright in setting out that they have no grievance to oppose the transfer of the land from the hands of Pﬁzer Limited to any other concern including the 4th respondent - M/s Topnotech Infrastructure Limited, which has been impleaded to Writ Petition No. 18646 of 2006, excepting that the land use is being altered from that of industrial to commercial purpose. The writ petitioners are agitated that by not using for industrial purposes, the land is, if allowed to put to commercial use, the State’s endeavour of promotion of industrial growth will suﬀer a dent with disastrous consequences. The petitioners contend that the very objective of setting apart a huge chunk of land of an extent of Ac.340.00 for promoting industries around the locality will suﬀer adversely. It is asserted by the petitioners that the State Government, to achieve accelerated industrial growth and to create large scale employment and at the same time, improve upon the living standards and thus paving the way for the overall development of the State, had set apart land of more than Ac.340.00 situated in Survey No.1 of Uppalkalan. Considering the proposals of the Commissioner of Industries, Government of Andhra Pradesh, orders have been issued by the State Government, through its G.O.Ms.No. 212, dated 14th February 1964, allotting large extents of land in favour of several industrial concerns. Of them, M/s Warner Lambert & Pharmaceuticals Limited has been allotted Ac.36.00 of land. The petitioners have further pointed out that the grant itself is subject to certain conditions, principal amongst them being that the company will use the land exclusively for industrial purposes including establishment of housing colonies for the staﬀ and workers and that importantly if the land is no longer required by the company, it shall forthwith relinquish and restore the same in favour of the Government and that if in the event of breach of the covenants, it shall be lawful for the Government to re-enter upon the land and take possession thereof and that the company shall not use the land for any other purposes. It is further pointed out that the State Government, upon establishing the Andhra Pradesh Industrial Infrastructure Corporation Limited (henceforth referred to as ‘APIIC’) for the purpose of establishing new industrial estates and to manage and administer all such industrial estates, had passed orders through its G.O. Ms. No. 1162, dated 4th December 1973, transferring all the powers and rights to administer and manage the industrial estates which were hitherto taken care of by the Commissioner of Industries. The petitioners have further pointed out that the original grantee, M/s Warner Lambert was taken over by M/s Parke- Davis (India) Limited, which is part of a multi- national pharmaceutical concern and that the said industrial concern had utilized only a certain portion of the land while leaving the rest of the land for purposes of disposal of the industrial waste generated by it and that large scale employment has been created by M/s Parke-Davis (India) Limited and that it was run hassle-free for several years and that it is one of the very well managed and run industrial concerns in the city which has earned a reputation of employing good and decent working conditions and that it is one of the industrial concerns reputed for its adherence to various principles including those which promoted industrial welfare and the welfare of the workmen. Unfortunately, M/s Parke-Davis (India) Limited has purposefully and schematically destroyed the industrial unit by forcing all its employees to enter into a voluntary retirement scheme with a view to ultimately close down the industrial concern itself. The petitioners further allege that M/s Parke-Davis (India) Limited has devised the scheme of oﬀering voluntary retirement to all its existing employees without waiting for their analysis and critical assessment of the eﬃcacy of such a scheme. In other words, the petitioners allege that M/s Parke-Davis (India) Limited has brought about a large scale retrenchment of the employees force by deceitfully forcing them to opt for, not so favourable termed voluntary retirement scheme. The petitioners, therefore, have raised an industrial dispute against this raw deal and also instituted Writ Petition No. 27218 of 2003, which is still pending in this Court. The petitioners contend that M/s Parke-Davis (India) Limited has liquidated a well-run pharmaceutical unit and sold itself oﬀ to yet another industrial giant - M/s Pﬁzer Limited and that M/s Pﬁzer Limited, instead of utilizing the infrastructure for re- establishing the pharmaceutical industry, has preferred the softer option to sell oﬀ the land in favour of another company, which is now intending to put the land to commercial purpose by way of construction of group housing, commercial malls, multiplex complexes, etcetera. Therefore, the petitioners contend that the land, which has been set apart by the State for exclusive industrial utilization, as part of its overall scheme of promotion of industrial growth, is sought to be exploited for commercial returns. Therefore, they have also solicited a consequential relief to direct APIIC to restore the land in favour of any industrial concern, which is likely to put to use the same for establishing and running an industrial concern and prevent it from being put to commercial use. The Andhra Pradesh Industrial Infrastructure Corporation as well as the new purchaser – the 4th respondent in Writ Petition No. 18646 of 2006 have contested the veracity of the factual statements made by the petitioners. It is asserted that the land, which has been set apart by the State Government and allotted in favour of M/s Warner Lambert & Pharmaceuticals Limited in 1964 has been put to eﬀective industrial use for nearly 40 years and that the land has been utilized by the successive pharmaceutical manufacturing units and consequently, the plain objective of the State Government of making available this infrastructure has been achieved. It is further asserted by the respondents that the Industrial Estate, which has been provided by the State had, in fact, brought about the desired result in the form of all-round growth of the locality. It had also pointed out that the industrial concerns in the locality promoted the welfare of the citizens not only by way of providing for large scale employment but also the housing in and around such industrial estates. Thus, the transformation of the locality from waste land to thick of human habitation has been brought about. The respondents further point out that even while executing the sale deed in favour of M/s Parke-Davis on 23rd October 1999, it has been speciﬁed that the land has got to be put to use for industrial activity only and that the subsequent sale of the land is also sought to be regulated only for establishment of another line of industrial activity and that the land is not going to be put to commercial use as is sought to be apprehended by the petitioners. On behalf of the 4th respondent, it has been pointed out that appropriate permission has been obtained from APIIC before the transfer by way of sale of the land of an extent of 1,45,692 square meters forming part of plot No.6 in IDA., Uppal, Hyderabad and that the 4th respondent had submitted necessary application to the Government of India seeking its permission for a “Sector Speciﬁc Special Economic Zone for Information Technology/Information Technology Enabled Services (IT/ITES)” in plot No.6, IDA, Uppal and that APIIC had accorded necessary ‘no objection’ for establishment of an IT park at plot No.6, IDA, Uppal on 24th February 2007 and that the Government of India, Ministry of Commerce and Industry, Department of Commerce (SEZ) Section, vide its proceedings dated 31st October 2006, granted approval for development, operation and maintenance of Sector Speciﬁc Special Economic Zone for Information Technology/Information Technology Enabled Services in plot No.6 and accordingly, and notiﬁed the same in the Gazette of India published on 18th May 2007. It has been pointed out that exercising the power available under sub-section (1) of Section 4 of the Special Economic Zones Act, 2005, the Central Government notiﬁed plot No.6, IDA, Uppal as “Speciﬁc Economic Zone”. Therefore, the apprehension entertained by the writ petitioners that the land in question is being put to non-industrial purposes or for commercial purposes, is totally erroneous and it is, in fact, misplaced. It is further asserted on behalf of the 4th respondent that upon establishing the IT park in terms of the permission accorded by Government of India, more than 16,000 employees would be provided with employment opportunities in the said park and that the park itself will fetch most valuable foreign exchange to Government of India. Thus, the 4th respondent has pointed out that the apprehensions entertained by the writ petitioners are not factually correct. It is further asserted that establishment of IT park has got several special features of its own and that it is incidental that a portion of the land may be put to use for housing or for purposes of intrinsically related activity including by way of providing recreational facilities for the large scale work force/ inmates of the park. The act of making available such facilities, the petitioners cannot allege that the land is being put to commercial purposes. It is further contended that the construction of an IT park is a distinct economic activity and should not be compared in any manner with construction of commercial complexes and/or multiplex complexes. I have heard Sri B.G. Ravinder Reddy and Sri D. Madhava Rao, learned counsel for the petitioners and the learned Government Pleader for Industries and Commerce, Sri K.V. Simhadri, learned Standing Counsel for APIIC and Sri P. Venu Gopal, learned Senior Counsel on behalf of Sri D. Krishna Murthy, learned counsel for the 4th respondent in Writ Petition No. 18646 of 2006. At the very outset, it should be stated that both the learned counsel for the petitioners have fairly pointed out that the validity, legality or correctness of the decision of M/s Parke-Davis (India) Limited and M/s Pﬁzer Limited in forcing all the employees into accepting the voluntary retirement scheme announced by them is not the subject matter of debate in this writ petition and that the same will be taken care of in Writ Petition No. 27218 of 2003, which is pending in this Court and various other proceedings which are pending on the ﬁle of various law enforcing agencies/Industrial Tribunals as the case may be and, therefore, for the present, the petitioners are conﬁned with securing relief for the purpose of ensuring that the land in question shall not be put to any use other than for the industrial promotion, which alone is the prime objective of the State Government in setting apart large extent of land of more than Ac.340.00 in the vicinity and thus creating an industrial estate in Uppal locality of Hyderabad and Secunderabad twin cities. Both the learned counsel for the petitioners have, therefore, contended that the propriety or the lack of it on the part of APIIC in not retrieving the land which belongs to the State and which is likely to be put to misuse is the principal area of concern for them and hence, these writ petitions came to be instituted. Learned counsel for the petitioners have drawn my attention that in somewhat similar circumstances, the APIIC has, in fact, proceeded against another allottee of land– M/s Penguin Textiles Limited and retrieved the entire extent of land on the ground that the same is not being put to use by the said allottee. Learned counsel have also pointed out that the said M/s Penguin Textiles instituted Writ Petition No. 33733 of 1998 against such an action of APIIC and the said writ petition came to be dismissed by the judgment rendered on 28th January 2000 and that the matter was carried by way of an appeal in Writ Appeal No. 252 of 2000 and more with a view to break the impasse, a compromise has been worked out by which, APIIC has been allowed to take complete possession of land of an extent of Ac.26.44 and the balance land of approximately Ac.20.19 alone has been allowed to be retained by M/s Penguin Textiles, the original allottee. The petitioners, therefore, point out that when once it has been upheld by this Court that APIIC has the power to retrieve such land which is not being put to industrial use any more by the original allotee, it is open to the State or its agency APIIC to retrieve possession of such land, which is not being put to industrial use at all by the allottees and the objective behind such measures being taken by the State or APIIC is to ensure that the land in the industrial estate at Uppal is put to use only for industrial purposes and not for any other purpose including commercial usage. Per contra, the learned counsel on the opposite side have pointed out that even now, the entire Ac.36.00 of land, which has been sold to M/s Parke-Davis (India) Limited, on 23rd October 1999 by way of a sale deed, which land is permitted to be sold by it, in turn, in favour of the 4th respondent in Writ Petition No. 18646 of 2006 is being put to only industrial use. It being a free hold land neither the sale in favour of the 4th respondent can be faulted nor can the petitioner challenge the use of the land by the 4th respondent. The learned counsel for the 4th respondent had emphatically denied the allegations sought to be levelled against them by pointing out that establishment of an IT park is still an industrial activity or purpose and it cannot be characterized as a commercial activity or purpose at all. The learned counsel would further assert that the land has been purchased by making huge investment of more than 12 crores of rupees and that it is being developed as a Special Economic Zone for the purposes of not only promoting top class infrastructural facilities with great employment potential, but at the same time, earn precious foreign exchange for the State. It is the contention of the learned counsel for the 4th respondent that the requirements of an IT park could be slightly at variance from the requirements of a pharmaceutical industry and consequently, a portion of the land could be put to group housing or recreational utilization. These are speciﬁc or special requirements of an IT park. They are nonetheless integral to the ultimate industrial activity of establishment of a Special Economic Zone. The very fact that the Government of India has been approached by the 4th respondent and the fact that the Government of India had considered the entire proposals and studied the same before according necessary permission under sub- section (1) of Section 4 of Special Economic Zone Act, 2005, de facto recognizes that the land is being put to industrial use but not for commercial use as is apprehended by the petitioners. At this stage, it is relevant to notice the Statement of Objects for which the Special Economic Zone Act, 2005, Act 28 of 2005 has been ushered in by the Parliament. Statement of Objects and Reasons: The Government of India had announced a Special Economic Zone Scheme in April, 2000 with a view to provide an internationally competitive environment for exports. The objectives of Special Economic Zones include making available goods and services free of taxes and duties supported by integrated infrastructure for export production, expeditious and single window approval mechanism and a package of incentives to attract foreign and domestic investments for promoting export-led growth. 2. There are at present eleven functioning Special Economic Zones. While seven Zones have been set up by the Central Government, four by the private/joint/State sector. In addition, approvals have been given for setting up of thirty-five new Special Economic Zones in the private/joint/State sector. 3. While the policy relating to the Special Economic Zones is contained in the Foreign Trade Policy, incentives and other facilities oﬀered to the Special Economic Zone developer and units are implemented through various notiﬁcations and circulars issued by the concerned Ministers/Departments. The present system, therefore, does not lend enough conﬁdence for investors to commit substantial funds for development of infrastructure and for setting up of the units in the zones for export of goods and services. In order to give a long term and stable policy framework with minimum regulatory regime and to provide expeditious and single window clearance mechanism, a Central Act for Special Economic Zones has been found to be necessary in line with international practice. To achieve this purpose, a “Special Economic Zones Bill, 2005” is proposed. The salient features of the Bill are as under: i) matters relating to establishment of Special Economic Zone and for setting up of units therein, including requirements, obligations and entitlements; ii) matters relating to requirements for setting up of oﬀ-shore banking units and units in International Financial Service Center in Special Economic Zone, including ﬁscal regime governing the operation of such units; iii) the ﬁscal regime for developers of Special Economic Zones and units set up therein; iv) single window clearance mechanism at the zone level v) establishment of an Authority for each Special Economic Zone set up by the Central Government to impart greater administrative autonomy; and vi) designation of special courts and single enforcement agency to ensure speedy trial and investigation of notiﬁed oﬀences committed in Special Economic Zones. Thus Act 28 of 2005 is essentially intended to bring in an industrial environment with export promotion orientation. Apart from seeking to garner substantial funds for development of infrastructure, it primarily seeks to secure units which will achieve greater export production. In short, this is a method conceived not only to inspire conﬁdence both in the domestic as well as international or foreign funding agencies to invest in developing sector speciﬁc infrastructure but the eye is kept on exports, which help in securing equally valuable foreign exchange. At this stage, it is apt to notice the contents of Section 4 of Act 28 of 2005. Section 4. Establishment of Special Economic Zone and approval and authorization to operate to, Developer: (1) The Developer shall, after the grant of letter of approval under sub-section (10) of Section 3, submit the exact particulars of the identiﬁed area referred to in sub-sections (2) to (4) of that section, to the Central Government and thereupon that Government may, after satisfying that the requirements, under sub-section (8) of sect on 3 and other requirements, as may be prescribed, are fulﬁlled, notify the speciﬁcally identiﬁed area in the State as a Special Economic Zone: Provided that an existing Special Economic Zone shall be deemed to have been notiﬁed and established in accordance with the provisions of this Act and the provisions of this Act shall, as far as may be, apply to such Zone accordingly: Provided further that the Central Government may, after notifying the Special Economic Zone, if it considers appropriate, notify subsequently any additional area to be included as a part of that Special Economic Zone.” It is thus manifestly clear that before a parcel of land is declared as a Special Economic Zone, weighty considerations are required to be bestowed by the State and only upon its being satisﬁed that it is essentially a ﬁt case, the same is to be declared as a Special Economic Zone. The notiﬁcation issued in the Government of India Gazette dated 18th May 2007 clearly discloses that the power available under sub-section (1) of Section 4 has been used after careful consideration of all relevant factors. The petitioners have not challenged the formation of opinion by the State and Central Governments in this regard to be erroneous or tainted for extraneous considerations. There is no issue raised in that regard. If the Central Government had the slightest of doubt that this parcel of land is not going to be utilized for industrial purpose, they would not have issued the notiﬁcation dated 18th May 2007. In that sense of the matter, the apprehension of the writ petitioners that the land is sought to be put to commercial use by the 4th respondent may not be correct. The petitioners have been propelled by an overriding spirit to prevent misuse of industrialized areas for commercial purposes. I, therefore, do not ﬁnd any merit in the contention canvassed on behalf of the petitioners that plot No.6 of IDA, Uppal area is ultimately sought to be put to commercial use by the 4th respondent. It will be well to remember that infrastructural facilities owned by the State are set apart or made available at nominal price and not for its market value for the purpose of achieving the overall welfare of the State. As part of its obligation to promote the all- round development of the State, certain areas are identiﬁed for the purpose of promotion of industrial growth. Industrial growth forms an important and integral part of the economic development of the State. Industrial development apart from opening up large scale employment opportunities, bring in along with them all-round development. The overall contribution of the industrial climate reﬂects upon the economic well-being of the citizens of the State and, therefore, at concessional rates, the State allows its infrastructure to be alienated in favour of private industrial concerns. unless this facility is made available, the industrial entrepreneurs will not be willingly coming forward to establish major industries as they will not be risking to undergo the hassles of acquisition of a compact block of land and tackle the same for the purpose of securing the necessary infrastructure for establishing an industrial concern. Therefore, an appropriate industrial climate has got to be created by the State, which alone will inspire the industrial entrepreneur to invest by establishing the industrial units in such localities. However, with the changing times, the infrastructural requirements of the industrial units have also undergone lot of changes. The all-round development also produces the necessary diﬃculties in the form of environmental pollution or environmental degradation. It, therefore, becomes inevitable for the State to keep ﬁnetuning and altering its policy directions. Some of the industrial units which were not considered at earlier points of time as hazardous, may come to be perceived as undesirable to be allowed to function from a particular locality in view of the density of population. Consequently, the line of activity of a particular industrial unit may have to be changed. In this view of the matter, the fact that instead of a pharmaceutical unit being run at plot No.6, if yet another non-polluting industrial unit is to be brought about, it does not amount to a change in the policy direction of the State itself. The overall development of the State of providing for industrial growth cannot be considered to have been completely ignored or even compromised. By bringing