Disposal of land vested in the Government should be dealt with only by following a fair and transparent procedure: High Court of Karnataka

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 15TH DAY OF APRIL 2021 THE HON’BLE MR.ABHAY S. OKA CHIEF JUSTICE THE HON’BLE MR.JUSTICE S. VISHWAJITH SHETTY WRIT PETITION NO.20651 OF 2007SHRI B.V. SHIVASWAMY AGED ABOUT 50 YEARS S OB.P.V. SWAMY R O. #312 3RD BLOCK RAJAJINAGAR BANGALORE 560 010. BY SHRI B.N. HARISH AMICUS CURIAE) AND: PETITIONER THE GOVERNMENT OF KARNATAKA REPRESENTED BY ITS PRINCIPAL SECRETARY URBAN DEVELOPMENT DEPARTMENT M.S. BUILDING DR. AMBEDKAR VEEDHI BANGALORE 560 001. THE BANGALORE DEVELOPMENT AUTHORITY REPRESENTED BY ITS COMMISSIONER KUMARA PARK WEST T. CHOWDAIAH ROAD BANGALORE 560 020. THE DEPUTY SECRETARY THE BANGALORE DEVELOPMENT AUTHORITY KUMARA PARK WEST T. CHOWDAIAH ROAD BANGALORE 560 020. 2 THE BDA EMPLOYEES WELFARE ASSOCIATION REPRESENTED BY ITS PRESIDENT KUMARA PARK WEST T. CHOWDAIAH ROAD BANGALORE 560 020. THE ADDITIONAL DISTRICT REGISTRAR BDA COMPLEX KUMARA PARK WEST T. CHOWDAIAH ROAD BANGALORE 560 020. ... RESPONDENTS BY SHRI V. SREENIDHI AGA FOR R1 SHRI. M.N. RAMANJANEYA GOWDA ADVOCATE FOR R2 AND R3 SHRI. K. SACHINDRAKARANTH ADVOCATE FOR R4 R5 SERVED) THIS WRIT PETITION IS FILED UNDER ARTICLE 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO CALL FOR THE ENTIRE RECORDS FROM THE 2ND RESPONDENT THE COMMISSIONER THE MURKY TRANSACTION OF SALE OF 33.02 ACRES OF AGRICULTURAL LANDS SITUATE AT DODDAKALLASANDRA UTTARAHALLI HOBLI CONVEYED TO RESPONDENT NO.4 I.E. THE PRESIDENT BDA EMPLOYEES WELFARE ASSOCIATION ON 09.11.2006 FOR A PALTRY SUM OF RS.88 31 587.00 & ETC. THIS WRIT PETITION HAVING HEARD AND RESERVED FOR ORDER COMING ON FOR PRONOUNCEMENT OF ORDER THIS DAY CHIEF JUSTICE DELIVERED THE FOLLOWING: By this public interest litigation bulk allotment of a land to an extent of 33 acres 02 guntas situated at Doddakallasandra village Uttarahalli Hobli Bangalore South Taluk in Sy.Nos.15 16 and 17 made by the Bangalore Development Authority to the Bangalore Development Authority Employees’ Welfare Association has been questioned on various grounds. The BDA has been established under Section 3 of the Bangalore Development Authority Act 19762. When this petition came up for hearing before the first Court on 16th January 2019 it was noticed that the Advocate for the petitioner is no more. Therefore Court notice was ordered to be issued to the petitioner. After service of Court notice none appeared for the petitioner and therefore this Court by Order dated 3rd June 2019 appointed Shri. B.N. Harish Advocate as amicus curiae to assist the Court. On 17th November 1998 a notification was issued by the Commissioner of the BDA for acquisition of 1111 acres of the land for formation of a layout known as Jayaprakash Narayan Nagar 9th stage. The Schedule Land was included in the said notification. Thereafter the lands comprising in various survey numbers including the Schedule Land which is the subject matter of this writ petition were acquired for formation of the said layout. According to the case of the petitioner on 7th October 2005 the department of Stamp and Registration had issued a the guideline market value of immoveable properties in the jurisdiction of various sub registrar offices in Bengaluru District. According to the case of the petitioner the land value of the agricultural land situated at Doddakallasandra village was fixed at Rs.63 00 000 per acre. On 9th November 2006 a sale deed was executed on behalf of the BDA in favour of the 4th respondent in respect of three parcels of land comprised in Sy.Nos. 16 17 and 18 of Doddakallasandra village Uttarahalli Hobli Bangalore South Taluk totally admeasuring 33 acres 02 guntas for consideration of Rs.88 31 587 . The 4th respondent is a Welfare Association of employees of the BDA. According to the case of the petitioner the Schedule Land was sold to the 4th respondent at a peanut price and there was huge loss to the State exchequer to the tune of rupees twenty crores. It is contended in the petition that granting of such a valuable land at a lower price and that too to an association of the employees of the BDA is a gross illegality. It is pointed out that it is not clear from the sale deed when the 4th respondent applied for bulk allotment. Even a copy of the order passed by the Government dated 19th April 2006 as described in the sale deed was not provided to the petitioner. Various other illegalities such as the breach of the provisions of the Bangalore Development Authority Rules 1995 have been pointed out. It is contended that a part of the Schedule Land admeasuring 30 acres is a Gomal land which is exclusively reserved for grazing of animals. But the Schedule Land was allotted to the 4th respondent for residential use without following the procedure contemplated under Section 71 of the Karnataka Land Revenue Act 1964 and the Karnataka Land Revenue Rules 1966it is contended that the Government has accorded permission to the BDA to allot bulk land to the 4th respondent. The manner in which the cost of the land is calculated is pleaded in paragraph 4 of the statement of objections. It is contended that the Gomal land has ceased to be as such due to urbanization. 6 The learned counsel appearing as Amicus Curiae firstly submitted that the Schedule Land allotted to the 4th respondent is a Gomal land. His submission is that the allotment has been made in gross violation of Section 71 of the KLR Act and KLR Rules. He relied upon Rule 97 of the KLR Rules and submitted that due to violation of the said provision the allotment made in favour of the 4th respondent is illegal. He invited our attention to Section 38 B of the BDA Act and pointed out that the bulk allotment can be made only with the prior approval of the State Government. He invited our attention to proviso sub ruleof Rule 7 of the Bulk Allotment Rules and submitted that said proviso specifically provides that the bulk allotment can be made only in respect of an area of five acres and if allotment is to be made of a land having an area more than five acres such allotment can be made provided that the Government for the reasons recorded in writing accords approval for allotment of such land. He stated that the reasons recorded by the Government have not been placed on record. He invited our attention to Rule 9 of the Bulk Allotment Rules containing the principles of selection. He submitted that the factors which are 7 mentioned in Rule 9 have not been considered at all. While drawing the attention of the Court to clauseof Rule 10 of the Bulk Allotment Rules he submitted that the value of the land per acre ought to have been fixed by the authority having regard to the prevailing market value. He invited our attention to the provisions of various laws. The learned counsel appearing for the second and third respondents submitted that there is an order made by the State Government in terms of proviso to sub ruleof Rule 7 of the Bulk Allotment Rules and the State Government is not expected to record detailed reasons for according approval for the bulk allotment. He invited our attention to the fact that the Schedule Land has already been converted into sites and various sites were allotted to various persons who are not made as parties to the writ petition. He would therefore submit that the allottees of the sites being necessary parties were required to be made parties. As the allottees of the sites have not been made as parties the writ petition is liable to be rejected for non joinder of necessary parties. He submitted that the issues which are now canvassed by the learned amicus curiae has not been raised 8 specifically in the writ petition. He submitted that several subsequent events have happened. And therefore it is not necessary for this Court to interfere at this juncture. Various factual details were pointed out by the learned counsel for the 4th respondent which support the stand of the BDA. The learned Additional Government Advocate appearing for the State Government supported the contentions urged by the BDA and submitted that no interference is called for. 9. We have considered the submissions made across the Bar and the relevant provisions of law. Under Section 38 B of the BDA Act the BDA is empowered to make bulk allotment by way of sale lease or otherwise of any land which belongs to it or is vested in it or acquired by it for the purpose of any development scheme. It is further provided that prior approval of the Government shall be obtained for allotment of bulk land to any categories listed in Section 38 B. It is necessary to make a reference to Section 38 B which reads thus: “38 B. Power of Authority to make bulk allotment. Notwithstanding anything contained in this Act or Development Scheme sanctioned under this Act the authority may subject to any restriction condition and limitation as may be prescribed make bulk allotment by way of sale lease or otherwise of any land which belongs to it or is vested in it or acquired by it for the purpose of any development scheme. to the State Government or to the Central Government or to any Corporation Body or Organisation controlled by the Central Government or the State Government or any Housing Co operative Society registered under the Karnataka co operative Societies Act 1959 or to any society registered under the Karnataka Societies Registration Act 1960 or to a trust created wholly for charitable educational or religious purpose: Government shall be obtained for allotment of land to any category listed above.” underlines supplied) The Authority as defined by section 2(a) of the BDA Act is The other provisions which are relevant consideration of the questions involved in this petition are the provisions of the Bulk Allotment Rules. The terms and conditions on which bulk allotments can be made have been prescribed by the Bulk Allotment Rules framed under the BDA Act. Rule 7 of the said Rule is material which reads thus: “7. Restrictions. The extent of land allotted under these rules shall not exceed five the Government may reasons to be recorded in writing accord approval for allotment of land exceeding five acres but not exceeding One Hundred acres and the Authority may in turn make allotment accordingly. The land allotted shall be used only for the purpose for which it is allotted.” underline supplied) 10. Thus bulk allotment of a land having an area exceeding five acres can be made by the BDA only on approval being granted by the State Government for the reasons recorded in 11. The first question which arises for consideration is whether the State Government had passed an order as required by proviso to sub rule of Rule 7 and the second question is whether fair and transparent procedure has been followed while allotting a large extent of land to the 4th respondent. The other issue is whether the market value of the land allotted to the 4th respondent has been fixed in accordance with law. All these questions will have to be considered in the context of the fact that the 4th respondent is an association of the employees of the BDA. In the writ petition specific reliance has been placed on the statutory requirement incorporated in the proviso to sub rule 1) of Rule 7 of the Bulk Allotment Rules. In paragraph 31 reliance is placed on the said provision. There is a specific contention raised to the effect that the market value of the allotted land has not been fixed in accordance with law. We find that the contentions regarding the failure to make proper valuation in respect of the Schedule Land and the violation of the Bulk Allotment Rules inasmuch as there was a failure on the part of the State Government in not recording reasons in writing as required by the proviso to sub rule of Rule 7 of the Bulk Allotment Rules have been specifically pleaded in the writ petition. In the statement of objections filed by the BDAreliance is placed on the acquisition proceedings the Schedule Land. Reliance is also placed on Government Order dated 19th April 2006 under which the Government has accorded approval for the bulk allotment of the land in favour of the 4th respondent. Reliance is placed on the proceedings of the BDA dated 14th February 2008 Annexure R5) on the subject of bulk allotment of the land to the 4th respondent. Various contentions have been raised regarding the manner in which the market value of the land is fixed. In the statement of objections filed by the 4th respondent it is pointed out that the BDA has made similar bulk allotments to the Association of the IAS officers to the Judicial Officers Society etc. It is pleaded that the 4th respondent has spent huge amount on development of the Schedule Land. It is stated that for development of the property the 4th respondent has so far spent more than eight crores rupees and a sum of rupees two crores has been paid to the authorities such as BDA BESCOM etc. In short the contention of the 4th respondent is that totally a sum of rupees ten crores has been spent by it on the development of the Schedule Land. Various factual details have been pleaded to justify the market value fixed by the BDA while making bulk allotment to the 4th respondent. In Annexure R1 the details of the expenditure allegedly incurred on development of the land have been set out. Annexure R6 is the list of allottees. It is stated therein that allotment of sites was made on 7th December 2007 to 759 members of the fourth respondent and they have been placed in possession of the sites allotted to them. The names site numbers area of the respective sites and sital value received have been set out in the Annexure R6. Along with the statement of objections filed by the 4th respondent on 29th June 2011 photographs have been annexed as Annexures R3 and R4 showing that work of making internal roads has been done and poles for street lights electricity supply have been erected. It is to be noted here that the contents of the statement of objections regarding formation of sites allotment of sites out of the Schedule Land to 759 members of the 4th respondent Association have not been denied by the petitioner by filing a rejoinder. Therefore this Court will have to proceed on the footing that in the year 2007 various sites mentioned in Annexure R6 to the statement of objections filed by the 4th respondent forming part of the Schedule Land were allotted to its 759 members after receiving the value of the sites from them. None of the said allottees have been made parties to the petition. Even in representative capacity some of them have not been made parties. Thirteen years have passed after the sites were allotted to the members of the 4th respondent. The allottees who are in large numbers will be directly affected by the orders that may be passed in this petition. With the passage of time some of them might have constructed houses on the sites allotted to them and some of they must have created third parties interests over the sites allotted to them. Therefore even assuming that there is an illegality associated with the bulk allotment made to the 4th respondent no effective relief can be granted in this petition in the absence of the allottees. Nevertheless we are required to examine the legal contentions raised in this petition. 15 It is an admitted position that the Schedule Land was acquired by the BDA for public purpose after paying compensation to the landowners. Therefore the Schedule Land being a valuable public property was vesting in the BDA which is an agency and instrumentality of the State being a body corporate created under the BDA Act 1976. Any land which has been vested in the Government or public authorities like the BDA should be dealt with only by following a fair and transparent procedure. As far as law regarding disposal of the public property is concerned the law is well settled. At this juncture we may refer only one leading decision of the Apex Court rendered in the case of Akhil Bhartiya Upbhokta Congress vs State of Madhya Pradesh and another1 . In paragraphs 64 to 67 of the said decision which are relevant read thus: “64. In New India Public School v. HUDA5 SCC 510 this Court approved the judgment of the Division Bench of the Punjab and Haryana High in Seven Society v. HUDA113 PLR 17] whereby allotment of land in favour of the appellants was quashed and observed:5 SCC 29 Public School case5 SCC 510] SCC p. 515 para 4) “4. A reading thereof in particular Section 15(3) read with Regulation 3(c) does indicate that there are several modes of disposal of the property acquired by HUDA for public purpose. One of the modes of transfer of property as indicated in sub sectionof Section 15 read with sub regulationof Regulation 5 is public auction allotment or otherwise. When public authority discharges its public duty the word ‘otherwise’ would be construed to be consistent with the public purpose and clear and unequivocal guidelines or rules are necessary and not at the whim and fancy of the public authorities or under their garb or cloak for any extraneous consideration. It would depend upon the nature of the scheme and object of public purpose sought to be achieved. In all cases relevant criterion should be predetermined by specific rules or regulations and published the public. Therefore the public authorities are required to make necessary specific regulations or valid to exercise their discretionary powers otherwise the salutary procedure would be by public auction. The Division Bench therefore has rightly pointed out that in the absence of such statutory regulations exercise of discretionary power to allot sites to private institutions or persons was not correct in law.” What needs to be emphasised is that the State and or its agencies instrumentalities cannot give largesse to any person according to the sweet will and whims of the political entities and or officers of the State. Every action decision of the State and or its agencies instrumentalities to give largesse or confer benefit must be founded on a sound transparent discernible and well defined policy which shall be made known to the public by the Official Gazette and other recognised modes of publicity and such policy must implemented executed by adopting a non non arbitrary irrespective of the class or category of persons proposed to be benefited by the policy. The distribution of largesse like allotment of land grant of quota permit licence etc. by the State and its agencies instrumentalities should always be done in a fair and equitable manner and the element of favouritism or nepotism shall not influence the exercise of discretion if any conferred upon the particular functionary or officer of the State. We may add that there cannot be any policy much less a rational policy of allotting land on the basis of applications made by individuals bodies organisations or institutions dehors an invitation or advertisement by the State or its agency instrumentality. By entertaining applications made by individuals organisations or institutions for allotment of land or for grant of any other type of largesse the State cannot exclude other eligible lodging competing claim. Any allotment of land or grant of other form of largesse by the State or its agencies instrumentalities by treating the exercise as a private venture is liable to be treated as arbitrary discriminatory and an act of favouritism and or nepotism violating the soul of the equality clause embodied in Article 14 of the 67. This however does not mean that the State can never allot land to the institutions organisations in educational cultural social or philanthropic activities or are rendering service to society except by way of auction. Nevertheless it is necessary to observe that once a piece of land is earmarked or identified for allotment to institutions organisations engaged in any such activity the actual exercise of allotment must be done in a manner consistent with the doctrine of equality. The competent authority should as a matter of course issue an advertisement incorporating therein the conditions of eligibility so as to enable all similarly situated eligible persons participate in the process of allotment whether by way of auction or otherwise. In a given case the Government may allot land at a fixed price but in that case also allotment must be preceded by a wholesome exercise consistent with Article 14 of the Constitution”. underlines supplied) In the case on hand we have carefully perused the proceedings of the meeting dated 14th February 2008 of the BDA and the resolution passed therein which is produced as Annexure R5 along with the statement of objections filed by the BDA. In the said proceedings a decision was taken by the BDA to allot the Schedule Land to the 4th respondent under the Bulk Allotment Rules. It is not the case of the BDA that a public notice was given inviting the applications for bulk allotment from the societies falling under any categories covered by clauses iv) and of Section 38 B of the BDA Act. Without inviting applications for bulk allotment the case of the 4th respondent 20 was directly considered. While making bulk allotment to the 4th respondent the procedure followed by the BDA shows that there was lack of transparency and no process which is fair and transparent was followed by the BDA. The Apex Court in the case of Akhil Bhartiya Upbhokta Congress categorically held that once a piece of land is earmarked or identified for allotment to institutions organisations engaged in any such activity the actual exercise of allotment must be done in a manner consistent with the doctrine of equality. The competent authority should as a matter of course issue an advertisement incorporating therein the conditions of eligibility so as to enable all similarly situated eligible persons institutions organisations to participate in the process of allotment whether by way of auction or otherwise. In a given case the Government may allot land at a concessional price but in that case also the allotment must be preceded by a fair process consistent with Article 14 of the Constitution of India. Thus as held by the Apex Court the action of the BDA being discriminatory and arbitrary the same will amount to violation of Article 14 of the Constitution of India. 21 18. Now we turn to the second issue as to whether the approval allegedly accorded by the State Government under purported exercise of its powers and by following the procedure contemplated under the proviso to sub ruleof Rule 7 of the Bulk Allotment Rules. We have perused the said letter dated 19th April 2006 sent by the Government which is at Annexcure R4 to the statement of objections filed by the BDA. It is claimed to be permission accorded by the State Government. The relevant portion of the said letter read thus: “Sub: Allotment of bulk land to BDA’s Employees Association to allot sites to its members employees Reg. Ref: Letter No.BDA Commissioner 2861 2005 06 date: 12 1 2006 With reference to the above your above referred proposal has been considered. Government has given approval in principle to the proposal for allotment of bulk land to BDA’s Employees Association to allot sites members employees. However I have been 22 directed to inform that Authority may choose land depending upon the availability of land”. underline supplied) 19. Firstly this letter does not record any reasons for according approval for allotment of the bulk land having an area exceeding five acres to the 4th respondent. Secondly even the area of the land permitted to be allotted to the 4th respondent is not mentioned. Thirdly the approval accorded by the State Government is not qua a particular land as the details of the land to be allotted to the 4th respondent are not incorporated in the said letter. But it is a general approval granted. The proviso to sub ruleof Rule 7 of the Bulk Allotment Rules carves out an exception to sub rule which lays down a mandatory rule that if the area is more than five acres the State Government’s prior approval for the reasons to be recorded in writing is necessary. Thus the benefit of the exception can be taken provided that the condition laid down under the proviso to sub rule of Rule 7 of the Bulk Allotment Rules is fulfilled. The condition was of the State Government recording the reasons in writing for granting approval for allotment of land exceeding five acres but not exceeding one hundred acres. As no reasons in writing have been admittedly recorded by the Government in its order dated 19th April 2006 the bulk allotment of the land made by the BDA in favour of the 4th Respondent is completely illegal being manifestly arbitrary and the same will have to be held violative of Article 14 of the Constitution of India. 20. As regards fixation of the market value of the allotted land is concerned the petitioners have not placed on record any material to show what was the exact market value was on the relevant date. Only the details of the components which are required to be taken into consideration have been placed record. 21. Thus on consideration of the above materials the scenario which emerges is that the allotment made by the BDA in favour of the 4th respondent appears to be completely illegal. However only on the ground of non joinder of 759 members allottees of the sites) this Court cannot grant any reliefs sought in this petition. Moreover the purchasers members allottees may have created third party interests. 22. We must place on record our appreciation for excellent assistance rendered by the learned counsel appointed as amicus curiae. 23. Hence we pass the following: O R D E R The writ petition is rejected only on the ground of non joinder of more than 759 members of the BDA Employees’ Welfare Association who are allottees of the sites formed out of the Schedule Land There shall be no order as to the costs. Sd CHIEF JUSTICE Sd Vr 

Summary: The competent authority should, as a matter of course, issue an advertisement incorporating therein the conditions of eligibility so as to enable all similarly situated eligible persons/institutions/organizations to participate in the process of allotment, whether by way of auction or otherwise. The Government may allot land at a concessional price, but in that case, also the allotment must be preceded by a fair process consistent with Article 14 of the Constitution of India. This was held in SHRI B.V. SHIVASWAMY v. THE GOVERNMENT OF KARNATAKA &amp; ORS.[WRIT PETITION NO.20651 OF 2007 (BDA-PIL)] in the High Court of Karnataka by division bench consisting of  CHIEF JUSTICE MR. ABHAY S. OKA AND JUSTICE S. VISHWAJITH SHETTY. Facts are that PIL has been filed for bulk allotment of land to an extent of 33 acres 02 guntas situated at Doddakallasandra village made by the Bangalore Development Authority to the Bangalore Development Authority Employees’ Welfare Association. According to the petitioners, the Schedule Land was sold to the respondent at a peanut price and there was a huge loss to the State exchequer to the tune of rupees twenty crores. The counsel for the petitioner contended that granting of such a valuable land at a lower price and that too to an association of the employees of the BDA is gross illegality. There has been a breach of the provisions of the Bangalore Development Authority (Bulk Allotment) Rules, 1995. Schedule Land in issue is exclusively reserved for grazing of animals. But the Schedule Land was allotted to the respondent for residential use without following the procedure contemplated under Section 71 of the Karnataka Land Revenue Act, 1964. The counsel for the respondents submits the Government had accorded permission to the BDA to allot bulk land to the respondent. The land has ceased land reserved for grazing due to urbanization. Learned counsel appearing as Amicus Curiae submitted that the Schedule Land allotted to the respondent is a Gomal land. The allotment has been made in gross violation of Section 71 of the KLR Act and KLR Rules. He relied upon Rule 97 of the KLR Rules and submitted that due to violation of the said provision, the allotment made in favor of the respondent is illegal. He also made reference to proviso sub-rule (1) of Rule 7, Rule 9, And Rule 10 that deal with Bulk Allotment Rules, principles of selection, and price fixation. The court in order to discuss the need for transparency in disposal of land vested in govt and relied on the judgment of Apex Court in the case of Akhil Bhartiya Upbhokta Congress – vs- State of Madhya Pradesh and another., wherein the following observations were made,“What needs to be emphasized is that the State and/or its agencies/instrumentalities cannot give largesse to any person according to the sweet will and whims of the political entities and/or officers of the State. Every action/decision of the State and/or its agencies/instrumentalities to give largesse or confer benefit must be founded on a sound, transparent, discernible, and well-defined policy, which shall be made known to the public by publication in the Official Gazette and other recognized modes of publicity and such policy must be implemented/executed by adopting a non-discriminatory and non-arbitrary method irrespective of the class or category of persons proposed to be benefited by the policy.” The court perused the proceedings of the meeting of the BDA and the resolution passed therein, with the statement of objections filed by the BDA. In the said proceedings, a decision was taken by the BDA to allot the Schedule Land to the respondent under the Bulk Allotment Rules.  Considering the facts of the case and keeping in mind the settled position of law on the subject. The Court held that, while making bulk allotment to the respondent, the procedure followed by the BDA showed a lack of transparency and fairness. The action of the BDA being discriminatory and arbitrary would amount to a violation of Article 14 of the Constitution of India. The court rejected the writ petition only on the ground of non-joinder of more than 759 members of the BDA Employees’ Welfare Association.