CWP No.4542 of 2009 (O&M) 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP No.4542 of 2009 (O&M) Date of decision: 03.02.2011 Harkishan ......Petitioner(s) Versus Union of India and others ......Respondent(s) CORAM:- HON'BLE MR.JUSTICE JASBIR SINGH HON'BLE MR.JUSTICE RAKESH KUMAR GARG * * * Present: Mr. C.B. Goel, Advocate for the petitioner. Mr. O.S. Batalvi, Advocate for respondent No.1. Mr. Narender Hooda, Sr.Additional Advocate General, Haryana with Ms. Palika Monga, Deputy Advocate General, Haryana for respondent No.2. Mr. Kanwaljit Singh, Sr. Advocate with Mr. Rohit Khanna, Advocate for respondent No.3. Mr. A.K. Ganguly, Sr. Advocate with Mr. Aashish Chopra, Advocate and Ms. Rupa Pathania, Advocate for respondents No.4 and 5. Rakesh Kumar Garg,J. By way of present writ petition, which has been filed in the public interest, a challenge has been made to the action of the State of Haryana, firstly in proceeding to acquire a big chunk of land for the alleged purpose of development of the land for residential and commercial area for Sector 30, Gurgaon and then proceeding to release the same in favour of respondent No.3 i.e. East India Hotels Limited vide communications dated 19.9.1995 (Annexure P-3) and 4.1.1996 (Annexure P-4) and thereafter permitting the sale of the aforesaid land by respondent No.3 in favour of respondents No.4 and 5 in violation of the conditions imposed vide release CWP No.4542 of 2009 (O&M) 2 orders Annexures P-3 and P-4 and then issuing notifications dated 6.12.2006 (Annexure P-7) and notification dated 19.3.2007 (Annexure P-8) under the provisions of the Special Economic Zone Act, 2005 by creating a nexus between the State Government and respondents No.3 to 5 to defraud the residents of the area with a further prayer to quash the release orders Annexures P-3 and P-4 sales made in favour of respondents No.4 and 5 vide Annexures P-5 and P-6 and also the notifications Annexures P-7 and P-8 or any other appropriate writ, order or direction which this Court may deem fit and proper in the facts and circumstances of the case. As per the averments made in this petition, the State of Haryana issued notification dated 30.1.1989 (Annexure P-1) under Section 4 of the Land Acquisition Act, 1894 ( in short the “Act”) to acquire an area measuring 210.38 acres in village Silokhera and an area measuring 5.20.acres in village Sukhrali for a public purpose namely utilization thereof for residential and commercial area for Sector 30, Gurgaon. However, notification under Section 6 of the Act was issued only for an area measuring 169 acres in village Silokhera and area measuring 2.13 acres in village Sukhrali. It is also a matter of record that an award was passed on 22.1.1992 only for a land measuring 8.64 acres (i.e. 7.01 acres in village Silokhera and 1.63 acres in village Sukhrali). It is further averred that the State of Haryana vide communication dated 19.9.1995 released 30 acres of land in favour of respondent No.3 i.e. a Company, namely, East India Hotels Limited. The operative part of the aforesaid communication reads as follows: “This has reference to your representation dated 14.2.1995 to the Hon'ble Chief Minister, Haryana, on the above mentioned subject and it is to inform you that your CWP No.4542 of 2009 (O&M) 3 proposal has been examined and Government of Haryana is considering to release 30 acres of land from acquisition forming part of the under mentioned facilities out of 37 acres 2 marlas land belong to you in Sector 30, Gurgaon: - a) Land required for Hospital project: 15.00 acres b) Land required for Hotel Management 7.5 acres Institute and its appurtenant and ancillary buildings c) Land needed for executive apartments 5.00 acres and staff housing d) Land under green belt 2.5 acres --------------- 30.00 acres --------------- The above mentioned 30 acres of land is being considered for release subject tot he following conditions: - 1. Released land shall not be sold without the approval of concerned Department of Govt. of Haryana. 2. Released land shall be used only for the facilities proposed to be set up by you as indicated above covering 30 acres of land proposed to be released. 3. Executive Apartments and Staff houses constructed on the released land including those on the 5 acres of land should not be sold and should be exclusively used for housing officers, other professionals and officials associated with the various facilities being developed. 4. You should obtain the permission for change of land use from the Director, Town and Country Planning, Department, Haryana, Chandigarh and an application for the same in the prescribed proforma with the relevant documents and fees should be submitted by you within 30 days of getting the 30 acres land released from acquisition. If obtaining change of land use permission from the concerned department is delayed for reasons CWP No.4542 of 2009 (O&M) 4 which can be ascribed to deficiencies on your part by more than three months from the date of releasing of this land the terms of release as mentioned here and as would be incorporated in the agreement are liable to be changed at the instance of this Department and the Director, Department of Urban Estates, Haryana, would be at liberty to rescind the agreement for release of land unilaterally. Further such penalties in the nature of forfeiting the whole or part of the guaranteed sum (as per condition No.6 and 7) are liable to be levied on you. 5. You should complete the construction of the said facilities viz. Hospital complex, Institute of Hotel Management and its appurtenant and Ancillary buildings and Executive Apartments and staff housing in a period of three years from the date of sanction of building plans which are to be submitted by you within a period of one month from the date of obtaining the change of land use permission. 6. The area under green belt as per the development plan of Gurgaon has to be maintained by you and no construction whatsoever would be allowed in the said green belt, statutory green belt as per the development plan has to be maintained no matter whether the area covered under that is more or less than the 2.5 acres of green belt projected by you in the representation. That is to say in the event of area under statutory green belt being less than 2.5 acres (which can only be ascertained once you submit the details of 30 acres on the khasra plan) then also 2.5 acres minimum green belt should be maintained by you. 7. A bank guarantee for a sum of two crore rupees shall be executed by you in the name of Director, Urban Estates, Haryana, valid for a period of four years from the date of agreement for release of land is executed. This bank guarantee and any additional bank guarantee executed by you under the land release agreement are liable to be forfeited in the event of failure to complete CWP No.4542 of 2009 (O&M) 5 the construction in a period of 3 years from the date of obtaining change of land use permission or upon breach of terms and conditions of agreement for release of land at any time. 8. You should undertake to provide additional bank guarantee of such like sum valid till the date two crore rupees bank guarantee indicated above in condition 6 is in force, over and above any other guarantees offered by you for releasing the land as and when the same would be intimated to you in the event of any enhancement in the acquisition rate awarded by any court of law for the land acquired in Sector 30, Gurgaon under Section 4 notification of Land Acquisition Act, 1894 issued on 30.1.1989. 9. You should provide 10% of the beds in the hospital proposed by you for the poor and 20% of the OPD and investigative services shall also be provided free in the hospital. 10. Preference shall be given to domicile of Haryana in the recruitment of Medical, Para-medical and other Class IV staff while filling the various posts in the facilities being developed by you depending upon the availability of requisite skills. 11. In the institute of Hotel Management, 20% of the trainees/students should be domiciles of Haryana. 12. for the released proportionate development charges are payable by you as and when the same are intimated. 13. You should withdraw all the court cases for enabling the department to release the land. 14. You should enter into an agreement with the Director, Urban Estates Department, Haryana, for fulflling all the other general conditions applicable for release of land including the above mentioned conditions. The proforma agreement and other relevant information would be provided to you by the Administrator, HUDA, Gurgaon, upon taking a formal CWP No.4542 of 2009 (O&M) 6 decision for release of 30 acres of land. 15(a) Director General, Health Services or his nominee would monitor the adherence or otherwise of the conditions mentioned at condition No.9 and 10. (b) Director, Tourism, Haryana, or his nominee would be the competent authority to monitor whether or not condition No.11 is being adhereto. The aforesaid communication was followed by a memo dated 4.1.1996 (Annexure P-4) directing the Administrative HUDA to get the agreement executed after getting all the formalities completed from respondent No.3 for release of the land. According to the petitioner, instead of constructing a hospital etc. as stipulated in the release orders (Annexures P-3 and P-4), respondent No.3 sold the aforesaid land in violation of the specific conditions of the release order to respondents No.4 and 5 for a sum of `14,37,50,000/- and for a consideration of `110 crores = `1,24,37,50,000/- on 22.8.2006 and 29.8.2006 (Annexures P-5 and P-6) . It is the further case of the petitioner that in order to facilitate the utilization of the land so purchased by respondent No.4 and 5 i.e. DLF Limited, the State Government further proceeded to issue notification on 6.12.2006 for setting up Special Economic Zone (in short the 'SEZ') with respect to an area measuring 29.7882 acres and notification dated 9.3.2007 with respect to an area measuring 7.1877 acres (Annexures P-7 and P-8). Thus, according to the petitioner, initially, the State Government proceeded to acquire the big chunk of land which included the area in question by invoking provisions of Land Acquisition Act, 1894 by labeling it as public purpose for development and utilization of the land for residential and commercial area Sector 30, Gurgaon by HUDA and then proceeded to release the CWP No.4542 of 2009 (O&M) 7 same in favour of respondent No.3-Company, namely, East India Hotels Limited for construction of a 300 bedded hospital and still further respondent No.3 proceeded to sell the land in question in favour of respondents No.4 and 5 and the State Government to facilitate the utilization of the aforesaid land by respondent No.4 and 5 issued notifications setting up Special Economic Zone which clearly shows the nexus between the respondent-Companies and the State Government to defraud the public at large and the State Exchequer. On the basis of the aforesaid facts, the petitioner raised the following questions for consideration of this Court:- “(a) Whether in the facts and circumstances of the instant case the action of the State Government in first proceeding to acquire a big chunk of land, then releasing the same in favour of the private company, though conditional, then permitting the sale of such land by respondent No.3 company in favour of respondents No.4 and 5 companies in violation of the condition of release, is not illegal, arbitrary, malafide and ultravires the provisions of the Act? (b) Whether the nexus between the State Government and the respondent companies in first getting area acquired and then seeking release of the same is not malafide and ultra vires of the provisions of the Act?” In response to the averments made in the writ petition, Union of India filed written statement submitting that policy and action of the State of Haryana-respondent No.2 was under challenge and in the present case, the SEZ proposed to be set up by respondent No.5 was approved by the CWP No.4542 of 2009 (O&M) 8 Board of Approval only after the necessary recommendations of the State of Haryana. In its reply, respondent No.2 has not disputed the facts regarding acquisition of land, then, release of land in favour of respondent No.3, sale of the disputed land in favour of respondents No.4 and 5 and issuance of notifications Annexure P-7 and P-8 for setting up a SEZ for respondent No.5. However, respondent No.2 sought to justify its action submitting that the sale deeds were executed in favour of respondent Nos.4 and 5 by respondent No.3 with the prior permission of the Government and the land so released which falls in the residential Sector 30 was to be utilized in accordance with the approved master plan as per the Development Plan of Gurgaon Manesar Urban Complex, 2021 where IT/ITES are permissible activities and respondent No.5 had sought permission for the same which was accorded by the Project Approval Committee as per the provisions of Haryana SEZ Act, 2005 and Development Commission NOIDA/Ministry of Commerce and Industry, Government of India. It was denied that respondent No.3 had proceeded to sell the land in question in favour of respondents No.4 and 5 in violation of the conditional release order. In the reply filed on behalf of respondent No.3, it was submitted that the petitioner had no locus to file the present writ petition which was filed after a lapse of more than 13 years after the transfer of land. It was further submitted that the said respondent is engaged in the business of Hotels in India and abroad and at the relevant time, it contemplated to set up hospitals/nursing homes/Management Training Institutes etc. and for the said purpose, purchased land measuring about 37 acres in the revenue limit of village Silokhera, Tehsil and District Gurgaon and respondent No.3 was granted permission vide letter dated CWP No.4542 of 2009 (O&M) 9 17.7.1984 to change the land use from agriculture to set up a Hospital/Management Training Institute etc. with regard to land measuring 18 acres 2 marlas. The necessary agreement was also executed on 11.7.1984 with the State of Haryana. Thereafter, respondent No.3 also made an application for change of land use for the remaining land. However, no action was taken on the said application. Since no reply was received, respondent No.3 submitted another application dated 22.9.1989 for permission for change of land use in respect of additional land. However, no permission was granted by the State Authorities. Respondent No.3 also submitted site plan for setting up of the hospital. It is the further case of respondent No.3 that the necessary approval to the drawings and plans for the proposed construction of the hospital was accorded in February 1986 and thereafter, the respondent-Company started construction. However, it could not make much progress. In the meantime, the Government of Haryana proposed to acquire the land for development of Sector 30 in Gurgaon and issued notification dated 30.1.1989 under Section 4 of the Act for acquiring the land in village Sukhrali and in village Sukhrali including the entire land measuring 37 acres belonging to respondent No.3. Respondent No.3 filed objections under Section 5-A of the Land Acquisition Act. Subsequently, a notification under Section 6 of the Act was issued on 25.1.1990 under which land measuring 169 acres relating to village Silokhera was finalized to be acquired and the remaining land was released from acquisition. Respondent No.3 challenged the aforesaid acquisition proceedings by filing CWP No.3808 of 1990 and vide order dated 23.3.1990 its dispossession was stayed. However, during the pendency of the said writ petition, an agreement dated 13.10.1997 was entered into between the State Government for release of 30 acres of land of respondent No.3 from CWP No.4542 of 2009 (O&M) 10 acquisition. Consequently, the writ petition was withdrawn. It has been specifically stated by respondent No.3 that the conditions of the said release of land issued by the State Government were duly complied with. It is the further case of respondent No.3 that since the change of land use was not forthcoming for one reason or the other, respondent No.3 could not commence the proposed project on the said land and the entire project had become unviable and uneconomic and at that time, respondents No.4 and 5 approached respondent No.3 for purchase of the said land. Since there was no restriction on the respondent except that the said land would not be sold with the prior permission of the appropriate Authority which was applied to the Director Town and Country Planning vide letter dated 31.3.2005 and the same was granted vide order dated 28.4.2006. Some additional conditions were put and after procuring the permission, the land was sold vide Annexures P-5 and P-6 and thus, there was no violation of any of the conditions on the part of respondent No.3. Respondents No.4 and 5 filed joint written statement raising preliminary objections regarding the locus standi of the petitioner to file the present writ petition in public interest. On merits, it was submitted by respondents No.4 and 5 that they had purchased land measuring 238 kanals 9 marlas situated in the revenue estate of village Silokhera, Tehsil and District Gurgaon vide conveyance deed dated 22.8.2006 and 29.8.2006 (Annexures P-5 and P-6 respectively) in pursuance to the Memorandum of Understanding as also the agreement to sell dated 21.2.2005 and 18.2.2005 entered into between respondent No.3 and respondent No.5 for a total consideration of `14,37,50,000/- crores and 110 crores = `1,24,37,50,000/- which was transferred to respondent No.3 with the approval of the Government as communicated by the CWP No.4542 of 2009 (O&M) 11 Administrator, HUDA, Gurgaon vide memo No.4273 dated 28.4.2006. It was further submitted by respondents No.4 and 5 that they were also granted necessary approval for setting up of SEZ for Information Technology and Information Technology Enabled Services ( in short 'IT/ITES') in Sector 30, Gurgaona as per the provisions of the Special Economic Zones Act, 2005 (hereafter referred to as the 'SEZ Act'). It is the case of respondents No.4 and 5 that the Government of India , Ministry of Commerce and Industry, Department of Commerce, vide its letter dated 17.1.2006, conveyed 'in principal' approval granted by the Government of India for setting up of SEZ for IT/ITES Sector over an area if 30 acres in terms of the provisions of the SEZ Act. After having received the approval 'in principal', from the Government of India and in consonance with the provisions of the Haryana SEZ Act, 2005, an application was submitted before the Project Evaluation Committee for forwarding the same to the Government of India for regular approval vide application dated 7.2.2006. Since the Government of Haryana had permitted the transfer of land in favour of DLF Limited, respondent No.5 vide its letter dated 7.6.2006 requested the Board of Approval that the said 'in principle' approval granted by the Government of India to DLF Commercial Developers Limited be transferred in the name of respondent No.5 and the said request was considered favourably in the meeting dated 21.9.2006 of the Board of Approvals granting formal approval which was conveyed vide letter dated 25.10.2006 by the Government of India. It was also stated in the written statement that respondent No.5 had deposited a sum of `23,05,05,153/- towards external development charges and thereafter, on demand, additional amounts of `19 lacs and `50,000/- were also deposited towards the difference in floor area ratio vide letter dated 31.7.2006 and CWP No.4542 of 2009 (O&M) 12 2.8.2006 respectively. Thereafter, the Ministry of Commerce and Industry, Department of Commerce issued notification dated 6.12.2006 and 19.3.2007 (Annexures P-7 and P-8 respectively) thereby notifying the total area of 12.06 hectares and additional area of 2.91 hectares at village Silokhera, Tehsil and District Gurgaon as SEZ. The building plans in respect of 29.81 acres for construction of the proposed SEZ were submitted for necessary action by respondent No.5 vide its letter dated 26.12.2006 and necessary approval to respondent No.5 for starting excavation works on self certification basis was conveyed. It was further mentioned in the written statement of respondents No.4 and 5 that an area measuring 30 acres approximately was purchased by virtue of conveyance deed dated 22.8.2006, Annexure P-5 and vide letter dated 9.10.2007 further request was made to the Development Commissioner, NSEZ to grant necessary approval to the zoning plan of 37 acres in Sector 30, Gurgaon. Vide its letter dated 24.10.2007, granted tentative approval to respondent No.5 to start work in the said 37 acres of the SEZ area while forwarding the said request to the Director Town and Country Planning for necessary comments and the zoning plans were ultimately approved vide memo No.4725 dated 26.2.2008. On the basis of the aforesaid facts, it has been submitted that respondents No.4 and 5 have purchased the land in dispute from respondent No.3 and have set up SEZ after all the required approvals and clearances from the concerned authorities and therefore, the writ petition is liable to be dismissed. It may also be pertinent to mention at this stage that the petitioner filed rejoinder to the written statement filed on behalf of respondent No.2 controverting the averments made in the said written statement and reasserting that the land was released in favour of respondent No.3 for a special purpose of providing a hospital but the same CWP No.4542 of 2009 (O&M) 13 was sold in violation of the specific conditions with an oblique motive of grabbing the valuable land for their own benefit. At this stage, it is necessary to point out that during the course of hearing on the basis of the record, counsel for respondent No.2 revealed certain facts before this Court which have not been mentioned in its written statement. It is not in dispute that vide Annexure P-1 notification dated 30.1.1989 land measuring 215.8 acres (including the land measuring 37 acres 2 marlas) was sought to be acquired for public purpose namely for development and utilization of land for residential/commercial area, Sector 30, Gurgaon. However, vide notification dated 25.1.1990 (Annexure P-2) issued under Section 6 of the Land Acquisition Act, land measuring 171.13 acres only was sought to be acquired and the remaining land was left from acquisition. Still further respondent No.3 filed CWP No.3808 of 1990 challenging the aforesaid acquisition and also prayed for release of its land. The said writ petitions was dismissed as compromised on the basis of agreement dated 13.10.1997 reached between respondents No.2 and 3 wherein the Department agreed to release 30 acres of land of the petitioner for Hospital Project with a specific condition that the land so released shall not be sold. It is also a matter of record that respondent No.2 has started resumption proceedings against respondent No.3 which were also challenged vide CWP No.16710 of 2002. These writ petitions i.e. CWP Nos.13401 of 2001 and 16701 of 2002 were got dismissed as withdrawn by respondent No.3 vide order dated 22.5.2006 submitting that the matter has been compromised between the parties and therefore, the petitioner does not wish to pursue this petition. The aforesaid facts which are very material to decide the present controversy have not been mentioned by respondent No.2 in its written statement which clearly envisage that there was an attempt on behalf of respondent No.2 to CWP No.4542 of 2009 (O&M) 14 conceal the true facts from the knowledge of this Court. At this stage, it may be noticed that by way of present writ petition, the petitioner has raised a grievance in public interest to show that initially the State of Haryana proceeded to acquire a big chunk of land which included the land in question by invoking provisions of Land Acquisition Act, 1894 by labeling it as a public purpose for development and utilization of land for residential and commercial area, Sector 30, Gurgaon by HUDA and then proceeded to release the same in favour of respondent No.3