1995 (2) TMI 476 - SC - Indian Laws

Summary

Issues Involved:
1. Validity of land acquisition for the appellant society.
2. Allegations of commercial venture and misuse of power.
3. Compliance with statutory requirements under the Land Acquisition Act.
4. Role of intermediaries in influencing the acquisition process.
5. Prior approval and public purpose under Section 3(f)(vi) of the Act.
6. Restoration of land to original owners.

Detailed Analysis:

1. Validity of Land Acquisition for the Appellant Society:
The appellant, a House Building Co-operative Society, sought land acquisition for its members. The State Government approved the scheme and initiated acquisition proceedings. However, the High Court quashed these steps, deeming the acquisition a colorable exercise of power and not for a public purpose.

2. Allegations of Commercial Venture and Misuse of Power:
The High Court found that the Society indulged in a commercial venture by selling sites, rather than allotting them to bona fide members. The involvement of M/s. S.R. Constructions, which acted as a middleman, further indicated misuse of statutory power by influencing the Government for land acquisition.

3. Compliance with Statutory Requirements under the Land Acquisition Act:
The acquisition process did not comply with the statutory requirements of the Land Acquisition Act. The High Court noted that the procedure adopted was likely to defeat schemes under the Bangalore Development Authority Act. The Society's agreement with M/s. S.R. Constructions to secure land acquisition through Government notifications was deemed irregular.

4. Role of Intermediaries in Influencing the Acquisition Process:
M/s. S.R. Constructions played a dubious role by negotiating with landowners and ensuring Government notifications for land acquisition. This involvement led to the conclusion that the statutory power was exercised due to extraneous considerations, not based on objective evaluation by the Government.

5. Prior Approval and Public Purpose under Section 3(f)(vi) of the Act:
The Court emphasized that the definition of "public purpose" under Section 3(f)(vi) requires prior Government approval for housing schemes by cooperative societies. The appellant society's scheme lacked such prior approval, rendering the acquisition invalid. The Court highlighted that prior approval is not a mere formality but a condition precedent for exercising acquisition power.

6. Restoration of Land to Original Owners:
The Court directed that, following the quashing of the acquisition proceedings, the possession of the lands should be restored to the original owners. The owners are required to refund any compensation received. This direction applies irrespective of whether the landowners challenged the acquisition.

Conclusion:
The Supreme Court upheld the High Court's decision, dismissing the appeals and emphasizing the necessity of prior Government approval for land acquisition under Section 3(f)(vi). The involvement of intermediaries and lack of compliance with statutory requirements invalidated the acquisition process. The Court ordered the restoration of land to the original owners, reinforcing the need for transparency and adherence to legal procedures in land acquisition cases.