2004 (4) TMI 597 - SC - Indian Laws

Validity of the sale deed executed by the Bangalore Development Authority - Legality of the allotment process without public auction, tender, or advertisement - Applicability of Section 38 and Section 38-B of the Bangalore Development Authority Act - Delay and laches - HELD THAT - In the instant case, it would appear, that no restriction, condition or limitation has been prescribed and in that view of the matter, the High Court, in our opinion, committed a manifest error in holding that the provisions of the said rules would apply to any transfer made by the Authority in favour of any person. A similar question came up for consideration before this Court in Chairman MD, BPL Ltd. vs. S.P. Gururaja and Others 2003 (10) TMI 655 - SUPREME COURT . This Court in that case examined in details the provisions of the said Act vis- -vis the Karnataka Industrial Areas Development Act, 1966. Therein also allotment of a peace of land in favour of an industrial undertaking was in question. The provisions of Section 38 and 38B operate in different fields. By reason of Section 38B of the Act, the legislature contemplated bulk transfer of land in favour of the Authorities mentioned therein which, may carry out the development scheme or deal with the matter in accordance with law. The High Court, in our opinion, has not correctly applied the principles of law governing the field inasmuch as it cannot be said that allotment of a plot measuring 1 acre 20 guntas is a bulk allotment. Whenever an allotment of land is made for industrial purpose, it cannot be restricted to a small peace of land. The extent of land sought to be allotted must be commensurate with the purpose for which the same is made. Furthermore, the writ petition should not have been entertained keeping in view the fact that it was filed about three years after making of the allotment and execution of the deed of sale. The High Court should have dismissed the writ petition on the ground of delay and laches on the part of the first respondent. The Division Bench of the High Court also does not appear to have considered the plea taken by the appellant herein to the effect that the first respondent had been set up by certain interested persons. In a public interest litigation, the Court should, when such a plea is raised, determine the same. Thus, the impugned judgment cannot be sustained. It is accordingly set aside. The appeal is allowed. The writ petition filed by the respondent stands dismissed.

Summary

Issues Involved:
1. Validity of the sale deed dated 19.6.1985 executed by the Bangalore Development Authority.
2. Legality of the allotment process without public auction, tender, or advertisement.
3. Applicability of Section 38 and Section 38-B of the Bangalore Development Authority Act.
4. Delay and laches in filing the writ petition.

Summary:

1. Validity of the Sale Deed:
The sale deed dated 19.6.1985 executed by the Bangalore Development Authority (the Authority) in favor of the appellant was questioned by the first respondent through a public interest litigation (PIL). The High Court allowed the PIL, declaring the sale deed invalid.

2. Legality of the Allotment Process:
The first respondent contended that the alienation was against public policy as no public auction, tender, or advertisement was conducted. The appellant argued that the writ petition was filed at the behest of an unsuccessful party and questioned the locus of the writ petitioner. The High Court held that the bulk allotment was contrary to the provisions of the Bangalore Development Authority Act (the Act).

3. Applicability of Section 38 and Section 38-B:
The appellant argued that Section 38 of the Act conferred unrestricted power to lease, sell, or transfer property for development purposes. The first respondent contended that the land earmarked for housing could not be allotted without a tender or advertisement. The Supreme Court found that the Division Bench of the High Court misconstrued Section 38, which allows the Authority to lease, sell, or transfer property subject to prescribed restrictions, conditions, and limitations. The Court noted that the three sets of rules framed under the Act were not applicable to the allotment in question, and thus, the Authority's power was not restricted.

4. Delay and Laches:
The Supreme Court observed that the writ petition was filed three years after the allotment and execution of the sale deed. The High Court should have dismissed the writ petition on the grounds of delay and laches. The Division Bench did not consider the appellant's plea that the first respondent was set up by interested parties.

Conclusion:
The Supreme Court set aside the impugned judgment of the High Court, allowed the appeal, and dismissed the writ petition filed by the respondent. No costs were awarded.