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Issues Involved:
1. Legality of the High Court's decision to quash the enhanced price demands. 2. Authority of the Karnataka Industrial Areas Development Board (KIADB) to revise the tentative price. 3. Compliance with statutory provisions and regulations in price fixation. 4. Judicial review of price fixation by the Board. Summary: Issue 1: Legality of the High Court's Decision The Supreme Court examined the appeals against the High Court of Karnataka's decision, which quashed the enhanced price demands made by the Karnataka Industrial Areas Development Board (KIADB). The High Court had allowed the writ appeal, setting aside the earlier judgment that dismissed the writ petition filed by the Respondents. Issue 2: Authority to Revise Tentative Price The Appellants argued that Clause 7(b) of the lease-cum-sale agreement empowered them to revise the tentative price. They contended that the final price was fixed considering the cost of acquisition, development expenditure, statutory charges, and interest. The Respondents, however, claimed that the final price was arbitrary, unreasonable, and contrary to legitimate expectations. Issue 3: Compliance with Statutory Provisions The Respondents argued that the price fixation should comply with the Karnataka Industrial Area Development Act, 1966, and the Karnataka Industrial Area Development Board Regulations, 1969. They contended that Clauses 7(a) and 7(b) were introduced without amending the applicable regulations or Form IV, making the final price fixation without statutory basis. Issue 4: Judicial Review of Price Fixation The Supreme Court noted that price fixation is an executive policy and generally beyond the scope of judicial review. However, it emphasized that the power of price fixation must be exercised rationally and reasonably, without arbitrariness. The Court observed that the High Court acted within its jurisdiction under Article 226 of the Constitution of India to ensure that the Board did not act arbitrarily. Conclusion The Supreme Court upheld the High Court's decision, concluding that the fixation of the final price by the Board was arbitrary and violated Article 14 of the Constitution of India. The appeals were dismissed, affirming that the Board must act fairly and reasonably in exercising its discretionary powers.
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