2006 (4) TMI 515 - SC - Indian Laws

Challenging the judgments of the High Court - Implementation of the development Project Report - Bar of res judicata - cost of land acquisition - Notifications issued from time to time for acquiring lands for the Project - Non-Service of Notice on the landowners u/s 28(1) of the KIAD Act - violation of Article 300A of the Constitution - HELD THAT - As we have stated, pursuant to the objections raised to the Project by the new Minister for Public Works, an Expert Committee was setup in 2004 to review the Project. The Expert Committee was conveniently headed by K.C. Reddy, who was the Advisor to the Public Works Minister. This K.C. Reddy was the same gentleman, who as a member of the previous HLC, had scrutinised the Project threadbare and had given it the green signal. Surprisingly however, at this stage, he appeared to be all willing to find faults and flaws in the Project and the FWA, despite the fact that there was an Empowered Committee that was required to monitor the implementation of the Project. The High Court rightly pointed out that the Expert Committee was constituted virtually in supersession of Clause 4.1.1 of the FWA. Interestingly, neither the interim report nor the final report of the Expert Committee identified the excess land but in fact, left it for the KIAD Board. The counsel for the KIAD Board handed over a set of documents, which purportedly identified the specific excess lands. It was the grievance of the KIAD Board that they had not been given the opportunity for placing these documents before the High Court. Since the date of documents showed that they were drawn subsequent to the date on which the High Court had delivered its judgment, the learned Senior Counsel for KIAD Board Mr. K.K. Venugopal candidly admitted that this exercise was carried out after the impugned judgment had been delivered. It is a moot point whether the person, who swore this affidavit on behalf of the KIAD Board stating that no opportunity had been given to the KIAD Board to place these documents on the record of the High Court, needs to be considered for prosecution u/s 340 read with Section 195 of the Code of Criminal Procedure, 1973. We strongly deprecate such misleading or false affidavits on the part of the KIAD Board. Article 300A of the Constitution - In our view, this is nothing but a repetition of the arguments made by the State of Karnataka. As we have elaborately discussed, that the land was not in excess has been held by the Division Bench of the High Court on two occasions and we agree with it. Thus, there was no question of the land being acquired for a purpose other than a public purpose or there being any contravention of Article 300A. In fact, we are somewhat surprised that this type of argument must come from the KIAD Board, which was intimately involved, from the very beginning, with the process of acquiring land. Further, the State and its instrumentalities (including the KIAD Board) were enjoined by Clause 5.1.1.1 of the FWA, to make best efforts to acquire the land required for the Project. Indeed, till the State itself changed its stand with regard to the Project, nothing was heard from the KIAD Board about lands being acquired in excess of the public purpose. Further, as an instrumentality of the State, the KIAD Board cannot have a case to plead different from that of the State of Karnataka. Thus, we are unable to countenance the arguments of Mr. Venugopal on behalf of the KIAD Board. Considering the facts as a whole, the High Court came to the conclusion that since the Project had been implemented and Nandi had invested a large amount of money and work had been carried out for more than seven years, the State Government could not be permitted to change its stand and to contend that the land allotted for the Project was in excess of what was required. Having perused the impugned judgment of the High Court, we are satisfied that there is no need for us to interfere therewith. Thus, there is no merit in this contention, which must consequently fail. It is pertinent to note that the State had agreed (vide Clause 5.1.1.1 of the FWA) in respect of the lands required under the FWA, that GOK shall use its best efforts and cause its Governmental Instrumentalities to use their best efforts, to exercise its and their legal right of eminent domain (or other right of similar nature) under the Laws of India to acquire the Acquired Land. Prior to acquiring any Acquired Land, GOK will obtain from the company written confirmation of its willingness to purchase such Acquired Land from GOK at the purchase price (whether in the form of cash or comparable land) required under the Laws of India (the Acquired Land Compensation ). GOK shall offer to the ex-propriated owners of the land the Rehabilitation package specifically worked out for this Infrastructure Corridor Project with mutual consultation of the consortium and the Revenue Authorities in accordance with the applicable rules . Thus, we find no reason to interfere with the said directions of the High Court. In the future also, we make it clear that while the State Government and its instrumentalities are entitled to exercise their contractual rights under the FWA, they must do so fairly, reasonably and without mala fides; in the event that they do not do so, the Court will be entitled to interfere with the same. Taking an overall view of the matter, it appears that there could hardly be a dispute that the Project is a mega project which is in the larger public interest of the State of Karnataka and merely because there was a change in the Government, there was no necessity for reviewing all decisions taken by the previous Government, which is what appears to have happened. Non-Service of Notice - When these appeals were argued, no attempt was made by any of the learned counsel to satisfy us that the appellants had not actually been served notice of the acquisition. Neither was the finding of the learned Single Judge or the Division Bench impugned on this point. We are, therefore, unable to accept the contention that notices were not served on the appellants as required u/s 28(1) of the KIAD Act. We do not see any prejudice caused to them as a result of the wordings of the notification of acquisition. The concerned authority also heard them on the objections filed after affording them an opportunity to file such objections under Section 28(2) of the KIAD Act. Thus, there is no substance in the contention of the appellants that the notification was vague and hence that the State did not comply with the principles of natural justice. The learned Single Judge erred in assuming that the lands acquired from places away from the main alignment of the road were not a part of the Project and that is the reason he was persuaded to hold that only 60% of the land acquisition was justified because it pertained to the land acquired for the main alignment of the highway. This, in the view of the Division Bench, and in our view, was entirely erroneous. The Division Bench was right in taking the view that the Project was an integrated project intended for public purpose and, irrespective of where the land was situated, so long as it arose from the terms of the FWA, there was no question of characterising it as unconnected with a public purpose. We are, therefore, in agreement with the finding of the High Court on this issue. The High Court accordingly found that the writ petitions were not maintainable. Since the writ petition proceeded on this footing, we cannot permit the appellants to take a different stand before us, contrary to what had been stated before the High Court. Since we have not been convinced otherwise, the writ petitions were not maintainable and the High Court was justified in the view that it took. In summary, having perused the well considered judgment of the Division Bench which is under appeal in the light of the contentions advanced at the Bar, we are not satisfied that the acquisitions were, in any way, liable to be interfered with by the High Court, even to the extent as held by the learned Single Judge. We agree with the decision of the Division Bench that the acquisition of the entire land for the Project was carried out in consonance with the provisions of the KIAD Act for a public project of great importance for the development of the State of Karnataka. We do not think that a Project of this magnitude and urgency can be held up by individuals raising frivolous and untenable objections thereto. The powers under the KIAD Act represent the powers of eminent domain vested in the State, which may need to be exercised even to the detriment of individuals' property rights so long as it achieves a larger public purpose. Looking at the case as a whole, we are satisfied that the Project is intended to represent the larger public interest of the State and that is why it was entered into and implemented all along. The Final Orders In the result, we find that the judgment of the High Court (dated 3.5.2005) impugned before us in the Main Matter, is not liable to be interfered with. There is no merit in the appeals and they are hereby dismissed. Considering the frivolous arguments and the mala fides with which the State of Karnataka and its instrumentalities have conducted this litigation before the High Court and us, it shall pay Nandi costs quantified at Rupees Five Lakhs, within four weeks of this order. In the Land Acquisition Matters, the appeals challenging the judgments of the High Court dated 28.2.2005, 29.6.2005 and 18.11.2005 are dismissed as without substance. However, in the circumstances, there shall be no order as to costs.

Summary

Issues Involved:
1. Fraud and Misrepresentation
2. Res Judicata
3. Excess Land and the Expert Committee
4. Non-Service of Notice
5. Vagueness of Notice of Acquisition
6. Purpose of Acquisition

Detailed Analysis:

Fraud and Misrepresentation:
The main argument of fraud and misrepresentation by Nandi was initially raised by the State of Karnataka but later abandoned. The High Court extensively examined this issue and found no evidence of fraud or misrepresentation by Nandi. The court noted that the Framework Agreement (FWA) was negotiated over several months and approved at the highest levels of the State Government. The High Court concluded that the allegations of fraud were politically motivated and lacked bona fides.

Res Judicata:
The doctrine of res judicata was applied to bar the present litigation, as the issues raised were already decided in the earlier case of H.T. Somashekar Reddy v. Government of Karnataka. The High Court had previously upheld the FWA and the land acquisition under it. The court emphasized that the principle of res judicata applies to Public Interest Litigations as long as the previous litigation was bona fide and in respect of a public right.

Excess Land and the Expert Committee:
The contention that excess land was acquired for the project was dismissed by the High Court. The court noted that the project was an integrated infrastructure development project, not just a highway project. The land acquisition was necessary for various developmental activities along the highway. The High Court criticized the formation and findings of the Expert Committee, which was set up by the new government to review the project, as being politically motivated and lacking credibility.

Non-Service of Notice:
The argument that no notice was served on the landowners under Section 28(1) of the KIAD Act was found to be factually incorrect. Both the Single Judge and the Division Bench of the High Court found that the landowners were served with notices and had filed objections, which were considered by the authorities.

Vagueness of Notice of Acquisition:
The contention that the notice of acquisition was vague was rejected. The court found that the purpose indicated in the notifications was sufficiently precise and that the landowners were aware of the purpose of the acquisition. The High Court noted that the landowners had filed their objections, indicating that they were not prejudiced by the wording of the notification.

Purpose of Acquisition:
The argument that the land acquisition was not for a public purpose was dismissed. The court held that the project was an integrated infrastructure development project, which included the development of roads and other infrastructure facilities. The acquisition of land, even away from the main alignment of the road, was necessary for the project. The High Court found that the project was in the larger public interest of the State of Karnataka.

Final Orders:
The Supreme Court upheld the High Court's judgment, dismissing the appeals and finding no merit in the arguments presented. The court ordered the State of Karnataka to pay costs to Nandi and the Supreme Court Legal Services Authority. The court emphasized that the project was in the larger public interest and should not be held up by frivolous and politically motivated objections.