SCA/8764/2008 1/6 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 8764 of 2008 For Approval and Signature: HONOURABLE MR.JUSTICE AKIL KURESHI ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= KARNAWATI CLUB LTD & 1 - Petitioner(s) Versus STATE OF GUJARAT & 1 - Respondent(s) ========================================================= Appearance : MR SI NANAVATI SR ADVOCATE AND MR ND NANAVATI SR ADVOCATE WITH MR ASHISH H SHAH for Petitioner(s) : 1 - 2. MR KAMAL B TRIVEDI ADVOCATE GENERAL WITH MS SANGITA VISHEN ASST GOVERNMENT PLEADER for Respondent(s) : 1, NOTICE SERVED BY DS for Respondent(s) : 1 - 2. ========================================================= CORAM : HONOURABLE MR.JUSTICE AKIL KURESHI Date : 13/08/2008 ORAL JUDGMENT Rule. Learned AGP Ms.Sangita Vishen waives service of rule on behalf of the respondents. SCA/8764/2008 2/6 JUDGMENT In the facts of the present case, the petition is taken for final disposal at the joint request of the learned advocates appearing for the parties. The petitioner No.1 – club is engaged in recreation activities situated in the outskirt of Ahmedabad. The portion of the land on which the club is currently situated was purchased by the petitioner No.1 – club from private individuals. However,the sale of the land dragged into legal controversy. It is not necessary to outline the details of such legal dispute. Sufficient it to say that by virtue of certain statutory provisions of law the orders passed by the authorities, an area of 10,013 sq.mtrs of lad was ordered to vest in the Government. The petitioners wish to retain the land even after paying necessary charges to the Government. Litigation in this regard had reached this Court earlier. By order dated 25.10.2007 passed in Civil Application No.13810 of 2007 in Special Civil Application No.8294 of 2007, the Division Bench of this Court directed the petitioners to deposit total amount of Rs.10.00 Crores in installments before this Court. It is not in dispute that such amount has been deposited and is lying with the Registry of the High Court. This deposit was to be adjusted towards final liability of the petitioners to pay charges to the Government for regularisation of the land in question. By order dated 17.03.2008 passed in Civil Application No.1663 of 2008 in Letters Patent Appeal No.449 of 2005, the Division Bench of this Court passed the following order. “ This application be taken for hearing with main petition. Shri S.I.Nanavati, Learned Senior Advocate for the petitioner submits that they are prepared to pay the entire SCA/8764/2008 3/6 JUDGMENT amount as directed and as demanded by the State Government. Shri Kamal B. Trivedi, learned Advocate General for the State has also not controverted the fact that if the entire amount as demanded is paid, the land can be regularized. They pray time. Time, as prayed for, is granted. However, with a view to avoid unnecessary delay, we direct the Government to determine the price within two weeks from today and within four weeks thereafter the amount be paid by the petitioner. The writ petition along with Civil Application be listed for final disposal on 5th May, 2008.” Pursuant to the above mentioned order dated 17.03.2008, the State Government vide its communication dated 01.05.2008 to the Collector, Ahmedabad conveyed its decision to the effect that the Government has assessed the land price at the rate of Rs.20,682/- per sq.mtrs. and accordingly, calculated the land price of 10,013 sq.mtrs. at Rs.20,682/- which comes to Rs.20,70,88,000/- and adding one time value multiplied by two and half times, the petitioners have to deposit a sum of Rs.51,77,22,165/-. It is this communication which the petitioners have challenged in this petition primarily contending that the entire exercise of the Government fixing the market price for the land in question calculating it at two and half time was carried out ex-parte without any opportunity to the petitioners to represent their case. SCA/8764/2008 4/6 JUDGMENT Appearing for th petitioners, learned Senior Advocates Mr.N.D.Nanavati and Mr.S.I.Nanavati submitted that the land was originally acquired by the petitioners. However, on account of legal complications and on account of the petitioners' not taking prompt steps at appropriate time, the land vested in Government. They submitted that the petitioners are not encroacher and the decision of the Government to demand maximum possible charges on assessment of the price of the land in question was, therefore, unjust. It was contended that in any case, with respect to fixation of the price of the land as well as the question of premium to be charged thereon, the petitioners should have been heard. On the other hand, learned Advocate General Mr.K.B.Trivedi appearing with learned AGP Ms.Sangita Vishen for the respondents submitted that the Division Bench of this Court in its order dated 17.03.2008 had required the Government to take decision within two weeks from the date of the order and the petitioners had agreed to pay the entire amount as may be demanded by the Government for regularisation of their possession within four weeks of the decision of the Government. He submitted that the Government has on the basis of the available material on record, assessed the price of the land at Rs.20,682/- per sq.mtrs. Having, thus, heard learned advocates appearing for the parties, though in the order that the Division Bench has passed on 17.03.2008, there is no specific mention that the petitioners shall be heard before the Government before the Government finalise the question of charges that the petitioners shall have to pay for regularisation of their occupation, it cannot be denied that the decision of the Government would certainly visit the petitioners with civil consequences. Undoubtedly, for final view SCA/8764/2008 5/6 JUDGMENT that the government would take in this regard would result into the petitioners having to deposit substantial amount of money towards regularisation of their occupation of land in question. Principle of natural justice would, therefore, be applicable. It would have been, of course, desirable if the petitioners had spelt out their desire for participation in the process of assessment of the market rate for the land in question when the Division Bench was passing the order on 17.03.2008. Even, thereafter the petitioners could have approached the Government before the Government took final decision pursuant to the order of the Division Bench. Instead, the petitioners have challenged the Government's decision in separate proceedings preliminary seeking to assert their right of hearing before finalisation of the question of the market value of the land and the total charges that the Government can claim from the petitioners. However, when the stake is substantial and when it is not manifestly apparent from the Government communication as to what was the basis for fixation of fair market value of the land at the relevant point of time, it would be in the interest of justice that exercise be undertaken afresh after permitting the petitioners to place on record the material available with them. For the above purpose, the impugned communication dated 01.05.2008 is set aside. The petitioners shall make representation to the Government within latest by 26th August, 208 with whatever material that the petitioners may wish to place on record. The State Government shall take fresh decision (after hearing the petitioners) as directed by this Court in the above referred order dated 17.03.2008 and communicate the same to the petitioners. For the above purpose, the Government shall convey to the petitioners the date on which such hearing will be fixed. The petitioners shall cooperate with the Government in bringing an early conclusion to this exercise. As directed by the Division Bench, the SCA/8764/2008 6/6 JUDGMENT petitioners shall deposit the charges that the Government may refix within four weeks of the communication of the decision of the Government. It may be noted that, the Division Bench in its order dated 25.10.2007 passed in Civil Application No.13810 of 2007 in Special Civil Application No.8294 of 2007 has provided that after the Government takes decision to fix the charges to be levied from the petitioners, the matter may be placed before the Division Bench for further orders. I am informed that order dated 17.03.2008 passed by this Court is under challenge before the Apex Court. It is clarified that this order would necessarily provide only for refixation of the charges being demanded by the Government from the petitioners and the order dated 25.10.2007 passed by the Division Bench would continue to operate for further modalities. Such refixation shall be subject to further orders that may be passed by the Hon'ble Apex Court. Learned advocate for the petitioners also submitted that the amount of Rs.10.00 crores deposited by the petitioners is lying with the High Court, may be withdrawn by the Government subject to the adjustments that may be made finally. However, this is arising out of the proceedings which are pending before the Division Bench and therefore, I leave the parties to work out the modalities in this regard. In view of the above observations and directions, the petition stands disposed of accordingly. Rule is made absolute to the extent indicated hereinabove. ( Akil Kureshi, J. ) kailash