Case: R. Rajashekar  Vs. Trinity House Build Coop. Society

The lands involved in all these acquisition proceedings are agricultural lands belonging to poor agriculturalists. On 09.01.1984, Trinity House Building Co-Operative Society (hereinafter referred to as thewas registered with the object of providing sites for building residential houses for its members. On 12.03.1985, the said society, represented by its President and Vice President entered into an agreement with M/S Srinivasa Enterprises, represented by its proprietor, Mr. S. Rangarajan. The said agreement was entered into between the parties essentially for getting the lands acquired in favour of the respondent-Society. The relevant clauses of the agreement will be extracted in the reasoning portion of the judgment. As per the agreement, a contract of agency was created in favour of Mr. S. Rangarajan to act as a middleman between the respondent-Society and the State Government to get the lands mentioned therein acquired in favour of the respondent-Society.4. It is also an undisputed fact that between 06.05.1987 and 12.06.1989, the land owners of the lands mentioned in the agreement dated 12.03.1985 have also executed power of attorney(s) in favour of Mr. S. Rangarajan. The state government of Karnataka by its order dated 23.06.1986, fixed the last date as 30.06.1984 for the registration of the societies. The respondent-Society finds a place at Serial No.43 in the annexure attached to the above government order.5. By way of order dated 30.04.1987, the state government of Karnataka constituted a ‘Three Mento verify the claims of land for acquisition being made by the various societies, and a State level Co-ordination Committee also was constituted by the Government to inquire into the affairs of the society before recommending their claim for acquisition.6. The case of the respondent-Society came up for consideration before the State Level Coordination Committee on 25.09.1987. The State Level Coordination Committee, without application of mind to the facts of the case, cleared the case of the respondent-Society for acquisition of lands in its favour. The relevant portion pertaining to the Society readsTrinity HBSC: Avalahalli and Herohalli (correct name Harohalli) villages, cleared for acquisition of 94-18 acres, Avalahalli (73-33 Acres) and Herohalli (22-25 acres)(both in Yelahanka Bobli) (Action: Revenue10.03.1988, the Additional Registrar of Co-Operative Societies, Bangalore passed an order under Section 64 of the Karnataka Co-operative Societies Act, 1959, to inquire into certain allegations made against 98 House Building Co-Operative Societies of Bangalore City, including the respondent-Society, and appointed Sri G.V.K. Rao, the then Controller of Weights and Measures to investigate into the allegations of irregularities and malpractices against the concerned societies.7. In the meanwhile, on 15.04.1988, an agreement was entered into between the state government of Karnataka and the respondent-Society as required under Section 39 read with Section 41 of Part VII of the L.A. Act. The relevant portions of the Agreement are extractedWHEREAS THE SOCIETY has applied to the Government of Karnataka (hereinafter referred to asat certain land more particularly described in the schedule hereto annexed and hereinafter referred to asshould be acquired under the provisions of the Land Acquisition Act, 1894 (I of 1894) hereinafter referred to asfor the following purpose namely:Formation of sites and construction of houses to the members of the trinity House Building Co-Operative Society Ltd. at Avalahalli and Herohalli, Yelahanka hobli, Bangalore North Taluk, Bangalore District. AND WHEREAS the Government having caused an inquiry to be made in conformity with the provisions of the said Act and being satisfied as a result of such inquiry that the acquisition of the said land is needed for the purpose.Subsequently, on 09.05.1988, the report of the G.V.K. Rao Committee was submitted to the Government for its action. The Report found irregularities in the manner in which the respondent-Society has granted membership to its members. It was stated in the report that the Vice President of the respondent-Society accepted these lapses and even attempted to justify the same.9. Even after the G.V.K. Rao Committee submitted its report, the state government of Karnataka proceeded to issue the preliminary notification under Section 4(1) of the L.A. Act, which was published in the official gazette dated 09.06.1988, proposing to acquire the lands in question to the extent of 92 acres 38 guntas in Avalahalli and Herohalli villages of Yelahanka Hobli, Bangalore North Taluk, Bangalore District in favour of the respondent-Society.10. Subsequently, around 33 Objection Petitions were filed before the Land Acquisition Officer by the landowners, which were all rejected under the inquiry conducted by him under Section 5-A(2) of the L.A. Act. The objections filed by some of the landowners were rejected by land acquisition officer primarily on the ground that the objections are not valid, and that the concerned lands come in the middle of the layout and that the lands are being acquired for the formation of house sites by the respondent society, which is a public purpose as per the definition of Section 3 (f) (vi) of the L.A. Act. On 18.03.1999, the state government issued the final notification under Section 6(1) of the L.A. Act declaring that the lands were required for public purpose without proper application of mind to the report received from the Land Acquisition Officer. The relevant portion of the notification is extractedwhereas the Government of Karnataka is satisfied after considering the report of the special Deputy Commissioner, Bangalore District, Bangalore under sub-section (2) of Section 5A and section 6(1) of special Land Acquisition Act (Central Act 1 of 1894) as amended by Karnataka Act No. 17 of 1961 and Land Acquisition (Amendment Act 1984) that the said lands are needed to be acquired for the purpose specified above.Aggrieved of the impugned acquisition notifications, the landowners challenged the validity of the same by way of filing Writ Petitions before the High Court of Karnataka urging various legal grounds and prayed for quashing the same. The learned single Judge of the High Court, after hearing the parties arrived at the conclusion that the facts of the case were similar to those in the decision of this Court in the case of H.M.T. House Building Co-Operative Society v. Syed Khader (1995) 2 SCC 677 ). On the facts of the case, the learned single Judge, by way of common judgment and order dated 12.07.1996 held asthe instant case, the 4th respondent along with the statement of objections has produced Audit Report as Annexure-I. In the said report there is reference that the landowners have been paid the consideration for their lands through M/S Sree Srinivasa Enterprises. There is also a reference that the society entered into an agreement dated 13.03.1985 with that of M/S Sree Srinivasa Enterprises and as per the said agreement the society has to pay Rs. 160/- per sq. yard to M/S Sree Srinivasa Enterprises......In the statement of objections it is stated that the society through the agency of M/S Srinivasa Enterprises, represented by its proprietor has made payments to the landowners. This fact shows that the facts involved in these petitions are identical with that of the case involved in the decision of HMT House Building Co-Operative Society (supra). The Supreme Court in the said decision has held that the power u/s 4(1) and 6(1) of the Act has been exercised for extraneous consideration at the instance of the persons who have no role in the decision making process. In the said view of the matter, I hold that the decision rendered by the Supreme Court is applicable in all fours and therefore the impugned notifications are liable to be quashed. In view of the decision of the Supreme Court referred to above, I hold that the petitioners are entitled to challenge the impugned acquisition since the land acquisition proceedings is the product of colourable exercise of power at the instance of the thirdlearned single Judge has further held that the lands could not have been acquired by the state government in favour of a society for the purpose of providing residential sites to its members without following the procedure provided under Part VII of the L.A. Act. The learned single Judge accordingly, quashed the impugned notifications and also the acquisition proceedings in exercise of the extraordinary and discretionary power under Article 226 of the Constitution of India.12. Aggrieved of the common judgment and order passed by the learned Single Judge, the respondent-Society filed Writ Appeals before the Division Bench of the High Court challenging the correctness of the same urging certain legal grounds. The Division Bench of the High Court held that there was no evidence on record to suggest that the/s Srinivasa Enterprises) had influenced the acquisition proceedings. On the other hand, it is clear from the material placed on record that the case of the respondent-Society was considered by the State Level Co-ordination Committee on 25.09.1987, and on the basis of the clearance granted by the Committee the state government granted approval to acquire the lands in question. Accordingly, the Division Bench, by way of common final impugned judgment and order dated 06.05.2004 allowed the appeals and set aside the judgment and order passed by the learned single judge and restored the acquisition proceedings. Hence, the present

Court's reasoning:
Division Bench, holding that the letter dated 26.11.1987 referred to supra amounts to approval of the scheme, is wholly erroneous in law for the reason that neither the Three Men Committee, nor the State Level Co-ordination Committee even adverted to the said letter in their proceedings. Further, no details are forthcoming from the original file regarding the details of the scheme, and the application of mind by the state government to approve the same. In the light of the decisions of this Court, as well as the wording of Section 3(f) (vi) of the L.A. Act, we are constrained to hold that the acquisition proceedings in the instant case cannot be said to be one for ‘publicas defined under Section 3 (f) (vi) of the L.A. Act, especially in the light of the fact that not only was there no scheme formulated by the respondent-Society and approved by the State Government for the said purpose before initiating the acquisition proceedings, but that the evidence on record clearly indicates that the respondent-Society paid consideration to Mr. S. Rangarajan to act as the agent between it and the state government, to ensure that the lands of the original land owners are acquired in its favour. Upholding such an acquisition would be akin to approving to such type of agreements which are opposed to public policy and the same cannot be allowed by this Court under any circumstances, as the concept of hiring middlemen to get lands of the poor agricultural workers acquired by the state government in favour of a Cooperative Society is abhorrent and cannot be granted the sanction of law.law.44. As far as the sale in favour of the appellants in the appeals arising out of SLP (c) Nos.18090-18118 of 2004 is concerned during the pendency of the writ petitions, the same is also void ab initio in law as the same happened during the pendency of the Writ Petition before the learned single Judge of the High Court. A Division Bench of this Court in the case of Uddar Gagan Properties Ltd. v. Sant Singh & Ors. (C.A. No. 5072 of 2016, decided on 13.05.2016)held that the sale transactions of a similar nature is void ab initio in law. Thus, the transactions of the alleged sales made during the pendency of the proceedings are wholly illegal and void ab initio in law and therefore the same cannot be allowed to sustain in law. The said sale transactions are also contrary to law which is in operation in respect of agricultural lands.45. The Impleadment Application Nos. 74-102 of 2010 filed in the appeals arising out of the SLP (C) Nos. 13656-13684 of 2004 are also liable to be rejected, as the applicant therein claims to be the Power of Attorney(s) holder of some of the lands in question and agreements of sale. Since he neither approached the High Court, nor this Court by way of filing SLPs and neither the agreements of sale nor the power of attorney(s) confer any right upon him at this time, as the same is barred by the provisions of the Land Reforms Act, 1952, provisions of the Specific Relief Act as well as the Limitation Act, the applicant has no legal right to come on record to challenge the impugned judgment and therefore the Impleadment Applications are rejected, as the same are wholly unsustainable in law.