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TMI Blog2018 (3) TMI 1964X X X X Extracts X X X X X X X X Extracts X X X X ..... .Adv., Mr. Uday Gupta, Adv., Ms. Sivani M. Lal, Adv., Mr. M.K. Tripathi, Adv., Mrs. Sarla Chandra, AOR, Mr. Rakesh Kumar-i, AOR, Mr. Apoorva Bhumesh, AOR, Ms. B. Vijayalakshmi Menon, AOR, Mr. A. N. Arora, AOR, Mr. Hiren Dasan, Adv., Mr. Harish Dasan, Adv., Mr. Chand Qureshi, Adv., Mr. Ankur Raghav, Adv. For the Intervener : Mr. Arun Monga, Adv., Ms. Divya Sharma, Adv., Mr. Gopal Jha, Adv. JUDGMENT Uday Umesh Lalit, J. 1. These appeals by special leave are directed against the common Judgment and Order dated 15.12.2014 passed by the High Court of Punjab and Haryana at Chandigarh dismissing Civil Writ Petition No.23769 of 2011 with other connected matters. Appeal arising from Civil Writ Petition No.23769 of 2011 namely Civil Appeal No.8788 of 2015, has been taken as the lead matter and the facts stated therein are dealt with in detail. 2. The aforesaid Civil Writ Petition No.23769 of 2011 was filed by 117landholders for the following principal relief: "a) Issue writ direction or order, especially in the nature of certiorari quashing the entire action of the respondents who invoked Sections 4 & 6 for the alleged public purpose but ultimately compelled the petitioners to be div ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on under Section 6 of the Act, the builders/private entities continued approaching the landholders. It was submitted that the landholders were being shown Award Nos.7, 8, 9, 10 and 12, all passed on 09.03.2006 in respect of adjoining villages for the same purpose namely setting up of Chaudhary Devi Lal Industrial Township, where compensation was awarded @ Rs.12.5 lakhs per acre. In all these cases, notifications under Section 4 were issued on 17.09.2004 while declarations under Section 6 were issued on 27.10.2004 and the lands covered under Award Nos. 7, 8, 9, 10 and 12 were i) 114 Kanals 02 Marlas, ii) 68 Kanals 15 Marlas, iii) 43 Biswas, iv) 65 Kanals 08 Marlas and v) 3515 Kanals 01 Marlas respectively. It was submitted that the landholders were thus cornered with the prospect of impending acquisition and the idea that the compensation would be awarded @ Rs.12.5 lakhs per acre and were persuaded to enter into transactions with builders/private respondents transferring their holdings @ Rs.20-25 lakhs per acre. (vi) On 02.08.2007 notices under Section 9 of the Act were issuedcalling upon the landholders to appear on 26.08.2007 for pronouncement of award. Soon after such notice, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovals of building plans of group housing societies and schemes of private builders came to be granted. (xii) Having come to know that the lands under acquisition were now being utilized for private gain by various builders/colonizers, the farmers started agitation against the process adopted by the Governmental machinery. (xiii) On 29.01.2010 a decision was taken by the State Government in Industries and Commerce Department to close the acquisition proceedings in view of the recommendations of the Inter Departmental Committee dated 26.03.2008 which in turn had been accepted by the HSIIDC. (xiv) The farmers' agitation against the decision of the State Government favouring the builders was widely reported in newspapers on 01.03.2011. The agitation continued beyond August and September, 2011. On 20.09.2011 a request was made by sending communications to various functionaries for registration of FIR in respect of fraud played by the officials of the Land Acquisition Department as well as the Director, Town Planning in active connivance with the builders. (xv) On 19.12.2011 the aforesaid Writ Petition No.23769 of 2011 was filed in the High Court of Punjab and Haryana at Chandig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State Government. The hike in price was essentially to lure the landholders as after dropping of the acquisition there would be no threat to the landholders. (xxi) On 24.02.2014 the High Court directed the State of Haryana to give details about various acquisitions initiated around the time in question for the same public purpose namely, setting up of Chaudhary Devi Lal Industrial Township. (xxii) Accordingly, on or about 21.03.2014 an additional affidavit was filed on behalf of State of Haryana giving relevant details in a tabular chart. These details appear to be in addition to the lands covered under Awards 7, 8, 9, 10 and 12 of 09.03.2006. The relevant tabular chart was as under:- Details of Sections 4 and 6 notifications along with the Revenue Estates as mentioned in the written statement dated 06.12.2012 Sl. No. Events 912 acres, IMT Manesar 24 acres, IMT Manesar 163 acres, IMT Manesar 3718 acres, IMT Manesar 3510 acres, IMT Manesar 1 2 3 4 5 6 7 1. Date of Sec. 4 Notification 27.08.2004 27.12.2005 25.11.2005 08.12.2006 25.04.2008 2. Land Area Notified U/S 4 912A-0 K-7M 24A-4K-5M 163A-3K-15M 3718A-6K-9M 3510A-5K-1M 3. Villages Lakhnaula, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per acre; identical to one assessed in Awards dated 09.03.2006. (xxiv)The aforesaid petition as well as connected matters were dismissed by the High Court vide its judgment under appeal. It was observed that the landholders had taken no action after their writ petitions were dismissed as infructuous by order dated 09.10.2007 and the present action initiated more than 4½ years after such dropping of acquisition was wholly belated. It was observed: "It is the case of the petitioners, that they were forced to sell their property under the threat of acquisition to the private respondents and thus the sale deeds so executed by them in their favour, deserved to set-aside. However we are unable to agree with the said contention raised by the Ld. Counsel for the petitioners as at no stage did the petitioners ever raised hue and cry viz. the said acquisition proceedings. Even when the writ petitions were filed by them in the year 2005 impugning the said acquisition proceedings, then also no grievance was raised by them in this regard and in fact during the pendency of these writ petitions, they even sold off their land to the private respondents for consideration and even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmission, the policy dated 19.12.2006 issued by the State Government provided that the licences could be granted where the applicants/land owners had applied for licences before the issuance of Notification under Section 4 of the Act and the release could be considered on individual merits of each case. He further submitted that as accepted by the State Government, out of 15 licences granted by the State Government, 8 were granted between the date of issuance of Notification under Section 6 and the date when the acquisition was dropped i.e. on 24.08.2007 and other 7 licences were granted after 24.08.2007. Thus all the licences, as a matter of fact, were granted after the issuance of Notification under Section 6 of the Act. (b) He submitted that the purchases made by the builders in the present case were after the lands were notified under Section 4 of the Act on 27.08.2004. At least sixty sale deeds were executed between the issuance of Notifications under Sections 4 and 6 of the Act while four sale deeds were executed on the date of declaration under Section 6 i.e. on 25.08.2005 and fifty sale deeds were executed after the issuance of Notification under Section 6 and prior to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ars that lands were purchased by Builders during acquisition proceedings and also after acquisition proceedings were dropped on the basis that fresh acquisition proceedings would be initiated. It further appears that the builders in the meantime were working to have the acquisition proceedings dropped and their applications for building licenses were also being processed and the issuance of such licenses themselves became a reason for dropping all proceedings. It does not appear anywhere from the record that the sellers of the lands were aware that the acquisition proceedings would be dropped but it has been alleged by them in the writ petition that they were informed of such acquisition proceedings and were therefore, asked to sell their interests. It would appear that rather than running the risk of what the award would amount to and having to contest the matter for the grant of the award, the purchasers transferred their interest to the builders, who on their part, as based on the CBI Report, appear to have used every effort to ensure that the acquisition proceedings were themselves dropped. 7. xxx xxx xxx 8. In these circumstances, should this Hon'ble Court find that the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain on the public exchequer. It would perhaps be best to restore status ante insofar as practicable i.e., lands on which constructions have not been made or which have not been plotted and transferred to third party individuals (not builders). In the case of constructions at a nascent stage, it can be determined whether bona fide third party interests have been created and in the absence thereof, status ante could be restored. In the remaining cases, payment of compensation could be directed through payment of consideration to the original landholders as per (b) above. g. The manner in which the amounts could be returned could be in the manner as held by this Hon'ble Court in the case of Uddar Gagan Properties Ltd. v. Sant Singh reported as 2016 (11) SCC 378. h. So far as the conduct of the acquisition proceedings and culpability of persons, government officials and builders in this regard, the CBI may continue its investigation and decide if any action is warranted, and take such action as is found to be necessary." 7. In his memo dated 05.04.2017 it was submitted :- "1. Should this Hon'ble Court conclude that there was a fraud in the entire proceedings, it should result in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... determined at the present days' market value or market value as on such other date as this Hon'ble Court may deem fit. Credit would be given to the builders for the amounts that they had paid to the original landholders and which is adjusted in (e) above; h. In the event that the builders do not wish to purchase the land at such rate, the land may be auctioned by the State; and i. Out of the price secured in the auction the amount paid for the acquisition would be deducted. The actual construction costs of any construction made on the lands would also be adjusted and the balance would be retained by the State for use for a public purpose of the area, providing of housing, rehabilitation, etc. by applying the principles of Section 88 of the Indian Trusts Act, 1882." 8. Mr. Vikas Singh, learned Senior Advocate appearing on behalf of respondent No.3 - ABW Infrastructure Limited filed an extensive list of dates and relevant material detailing various transactions under which his client came to purchase the lands in question. The transactions referred to in the list of dates and accompanying documents, put in tabular chart by us are as under: S. No Date Name of Purchaser Area ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/- 1, 20, 15, 066/- 20 17.2.11 Respondent No.3 0.76875 Acres One (1) 1, 92, 18, 750/- 2, 50, 00, 000/- 21 27.2.11 Respondent No.3 0.025 Acres One (1) 4, 48, 000/- 1, 79, 20, 000/- 22 18.3.11 Respondent No.3 0.76875 Acres One (1) 1, 92, 18, 750/- 2, 50, 00, 000/- Total 235.55121 Acres 90, 13, 75, 109/- The aforesaid chart discloses that the average price paid was initially in the region of Rs.25 lakhs per acre. Soon after the issuance of Section 6 declaration, the price rose to Rs.40 lakhs or above. But just before 24.08.2007 i.e. the date when the State Government decided to drop the acquisition, the price was in the region of Rs.80 lakhs per acre. The price paid after the decision to drop the proceedings was above Rs.1.2 crores per acre. The documents placed by Mr. Vikas Singh, learned Senior Advocate do indicate the names of vendors as well. However, for facility we have not included the names of vendors but have given the other details in the chart. The documents further indicate that all these lands purchased by the first purchasers as indicated in the tabular chart were then taken over by the respondent No.3; on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Licence fees. Paras 5 and 7 to 9 of the application were:- "5. Whether applicant is income tax payer, if so, the amount of income tax paid during each of the last three years. YES PAN : AAECA-5466H Assessment Year: 2007-08 Rs.77, 49, 859/- NIL- 2005-06, 2006-07 Construction work in progress. 7. Whether the applicant had ever been granted permission to set a colony under any other law, if so, details thereof. NO 8. Whether the applicant had ever establishes a colony or is establishing a colony and if so, the details thereof. NO 9. Any other information the applicants like to furnish. 'ABW Infrastructure Limited' The ABW Group of Companies are already developing number of shopping cum commercials Malls and in process of developing the Township in Mohali, Chandigarh the total projects more than worth Rs.1000.00 crores are in development and in progress." In none of these two cases the applicants themselves had any prior experience and between them, only one had paid Income tax and that too only in one financial year. Both had given same PAN numbers. 10. Since the documents also indicated that after having applied for issuance of licences, respondent No.3 had transferred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly purchased the lands from the landholders, had sold the said lands to Respondent No.3 and were paid sums reflected at Sl. Nos.2 and 5 above amounting to Rs.17.70 crores (approx.) for acquiring such interest in said lands. Thereafter, amount of Rs.5.45 crores (approx.) was paid by way of fees to the Government. However, more than Rs.150 crores was received on transfer to DLF Homes Developers Pvt. Ltd. For an applicant who reportedly paid income tax only once during last three years, this by itself constitutes phenomenal earning. From and out of such earnings an amount of Rs.119.695 crores was paid by Respondent No.3 under Settlement-cum Cancellation of Agreement of Sell as indicated at Serial No.8. 11. On an inquiry by this Court regarding details of such amounts paid by respondent No.3 as indicated at Serial No.8, those documents were filed on record. The documents make an interesting reading. By way of sample, documents pertaining to transactions between Beeta Promoters P. Ltd. and the intending purchaser Arison Builders P. Ltd. are dealt with in some detail: (a) By Agreement of Sale dated 09.10.2007 entered into between M/s Beeta Promoters Pvt. Ltd. = Vendor and M/s Arison B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nbsp;(b) By Settlement Agreement-cum-Cancellation of Agreement to Sell executed on 30.08.2008 between the aforesaid parties, the earlier arrangement entered vide Agreement of Sale dated 09.10.2007 was cancelled. While cancelling that arrangement, settlement amount of Rs.3.50 crores per acre was paid to the vendee as full and final settlement between the parties and discharge of all claims. The document narrates that though the cheque for Rs.1 lakh was given on the date when the agreement to sell was executed on 09.10.2017, said cheque was never encashed and was returned to the vendee. Thus, the land which was agreed to be sold @ Rs.58 lakhs per acre was not sold at all but by way of settlement Rs.3.5 crores per acre was made over to the vendee. Interestingly, nothing was received by the vendor by way of advance/earnest through Bank channels as the cheque was admittedly never encashed. The relevant portions from the Settlement-cum-Cancellation of Agreement to Sell dated 30.08.2008 were as under: "And whereas 'the parties' has entered into agreement to sell dated 9th October, 2007, as per the terms of agreements described therein. And whereas 'the Seller' has agreed to sell and ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, Haryana." Identical agreements for sale followed by Settlement Agreementscum-Cancellation of Agreements to sell were entered into by all the concerned, as set out hereafter. 12. The details of the relevant agreements to sale and Settlement-cumCancellation agreements to sell as filed by respondent No.3 are put in a tabular chart by us. Except in the case at Serial No.1 where part of earnest money was deposited in cash, in all other cases, earnest was paid by cheques. However, in none of the cases any cheque which was issued as advance-cum-earnest money was encashed. The relevant recitals in these agreements are identical to those extracted hereinabove. The compensation paid to the vendee in every case is on or about 30.08.2008 and at a consistent rate of Rs.3.50 crores per acre. The said chart is as under: S. No. Vendor Purchaser Area of land (Acres) Date of Agreement of Sale deed with transaction amount Adv. Amt. recd. By cheque (Rs.) Date of Settlement Agreement Compensation Amt. (Rs.) 1 Beeta Promoters P. Ltd. Arison Builders P. Ltd. 0.12 09.10.2007 Rs.7,03,200 2,00,000 30.8.2008 42,00,000 2. Divyajyoti Enterprises P. Ltd. Arison Builders P. Ltd. 2.47 03 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Financing P. Ltd. 0.17 26.10.2007 Rs.9,95,350 2,00,000 30.8.2008 59,50,000 Hasan Steel & Alloys Pvt. Ltd. 1.7 20.10.2007 Rs.99,53,500 30,00,000 30.8.2008 5,95,00,000 Global Alloys P. Ltd. .61 23.10.2007 Rs.35,71,550 10,00,000 30.08.2008 2,13,50,000 33.55 119,69,50,000 13. Mr. Vikas Singh, learned Senior Advocate also invited our attention to the provisions of the Haryana Development and Regulation of Urban Areas Act, 1975 (hereinafter referred to as the "Haryana Act") and submitted that the Haryana Act provided for colonization encouraging private participation wherein builders or colonizers become partners with State in ensuring planned development. It was submitted that the writ petition in the present case was bereft of any material particulars and suffered from non-disclosure of collaboration agreements entered into between the builders and the writ petitioners whereunder certain additional benefits were given to the landholders. In his submission, the High Court was justified in dismissing the petition and exemplary costs ought to be imposed on the writ petitioners for embar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n by the High Court ought to be affirmed. Similar submissions were made by Mr. Kapil Sibal, learned Senior Advocate for the same client in a different matter. In his submission, if at all any disgorgement as suggested by the learned Amicus Curiae is to be made, it ought to be by respondent No.3 i.e. the client of Mr. Vikas Singh, learned Senior Advocate and not by DLF Home Developers Pvt. Limited which had paid market value for the land it purchased. Mr. Suri, learned Senior Advocate appearing for flat purchasers from DLF Home Developers Pvt. Ltd. submitted that his clients, coming from middle class, had put in all their savings in purchase of flats. Out of 1348 flats constructed in the complex, 1237 flats were sold and more than 500 apartments were already registered in the names of apartment purchasers. 15. Mr. Nidhesh Gupta, learned Senior Advocate appearing for Earl Infotech Pvt. Ltd. and for Frontier Infrastructure Developers Pvt. Ltd. made similar submissions. He submitted that the case in hand was completely different from the fact situation considered by this Court in Uddar Gagan (supra) in as much as neither was there any distress sale by the land owners nor was there any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... functionaries of the State in the present case was colourable and such exercise was fraud on power, then not only should the guilty be booked on criminal side, but on the civil side the mechanism suggested by the learned Amicus Curiae be adopted. 19. Though copies of the interim report of CBI were not given to the parties, some factual aspects dealt with in the report, namely the allegations in the FIR and certain bare minimum facts as found from the record, need to be adverted to. Paras 2 and 18 to 21of the Report were as under:- "2. It is alleged in the FIR that the Government of Haryana had issued notification u/S 4 of the Land Acquisition Act, 1894 on 27.08.2004 and u/S 6 on 25.08.2005 of Land Acquisition Act, 1894 for acquisition of land measuring about 912 acres for setting up an Industrial Model Township in Villages Manesar, Naurangpur and Lakhnoula in Distt. Gurgaon. A large number of land owners, in haste, had sold out about 350 acres of land at throw away rates of Rs.20 to 25 lakhs per acre. It is further alleged that when some land was not sold by the farmers, the Government issued notification u/S 9 of Land Acquisition Act and, thereafter, the private builders had pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4, Saket District Centre, Saket, New Delhi 45 1 6 Ecotech Buildcon Pvt. Ltd. Rectangle-1, D4, Saket District Centre, Saket, New Delhi 23 2 17.5 Progressive Buildtech Pvt. Ltd. 22 2 2 Dugman Engineers Pvt. Ltd. Rectangle-1, D4, Saket District Centre, Saket, New Delhi 23 0 3 Mount Valley Estates Pvt. Ltd., Rectangle-1, D4, Saket District Centre, Saket, New Delhi 19 4 11 Galaxy Colonizers Pvt. Ltd. Rectangle 1, D4, Saket District Centre, Saket, New Delhi 3 5 5 ABW Infrastructure Pvt. Ltd. Rectangle-1, D4, Saket District Centre, Saket, New Delhi 12 4 9 M/s Miraj Overseas Ltd. 9 1 9 M/s Beeta Promoters Pvt. Ltd. 3 3 7 M/s Jassum Estate Pvt. Ltd. 17 1 12 M/s Jassum Inf. Pvt. Ltd. O/o 64, Purvi Marg, New Delhi Amit Bhasin 5 2 9 M/s Jassum Towers Pvt. Ltd. O/o 208-210 SF Rectangle 1, D4, Saket, New Delhi- Sachin Arora 9 7 3.5 M/s Yorks Hotel Pvt. Ltd. 24 6 16 Total 248 5 17 6. Paradise System Pvt. Ltd. E-20 Lajpat Nagar-III, New Delhi 13 1 11 DJ Tradelink Pvt. Ltd., 201, Surya Kiran Building, 19, KG Marg, Delhi 3 7 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re). Date of purchase of land from villagers Date of transfer of land along with company to Atul Bansal 1 NCR Properties Pvt. Ltd. 11 acres 2kanal 5marla November, 2004 to January, 2005 29.06.2007 2 Yorks Hotel Pvt. Ltd 24 acres 6kanal 16marla August, 2005 to December, 2005 02.03.2007 3 Dugman Engineers Pvt. Ltd. 23acres 0kanal 3marla May, 2005 to November 2005 02.03.2007 4 Miraz Overseas Pvt. Ltd. 9acres 1kanal 9marla August, 2005 to November, 2005 02.03.2007 5 Galaxy Colonizers Pvt. Ltd. 3acres 5kanal 5marla August, 2005 to January, 2006 07.03.2007 6 Sheel Buildcon Pvt. Ltd. 45acres 1kanal 6marla November, 2004 to May, 2005 22.04.2008 7 Progressive Buildtech Pvt. Ltd. 22acres 2kanal 2marla February , 2005 to October, 2005 22.04.2008 8 Ecotech Buildcon Pvt. Ltd. 23acres 2kanal 17.5marla February , 2005 to November 2005 22.04.2008 9 Beeta Promoters Pvt. Ltd. 3acres 3kanal 7marla December, 2004 to March , 2005 25.11.2007 10 Divya Jyoti Enterprises Pvt. Ltd. 3acres 0kanal 19marla December, 2004 to June, 2005 13.02.2008 11 Indo Asian Construction Co. Pvt. Ltd. 14acres 7kanal 3marla October, 2004 to November, 2004 21.11.2007 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnment in arriving at decisions dated 24.08.2007 and 29.01.2010 was the fact that several applications were preferred by builders for licence/CLU in respect of lands forming part of the acquisition proceedings, we deal with relevant statutory framework at the outset. A] Appropriate resolutions in terms of Article 252 of the Constitution having been passed by the Houses of Legislatures of the States of Haryana, Rajasthan and Utter Pradesh, the National Capital Region Planning Board Act, 1985 (hereinafter referred to as the "NCR Act") was enacted to provide for the constitution of Planning Board for preparation of a plan for the development of the National Capital Region. Reading of Section 2(f) with Schedule to the Act shows that the tehsils of Gurgaon, Nuh and Firojpur-Jhirka of district Gurgaon form part of National Capital Region. Chapter IV of the NCR Act deals with constitution and incorporation of the National Capital Region Planning Board. Chapter IV of the NCR Act deals with "the Regional Plan" which in terms of Section 10 "shall be a written statement and shall be accompanied by such maps, diagrams, illustrations and descriptive matters" and "shall indicate the mann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 8, only at a distance of 4 kilometers from the Indira-Gandhi International Air Port and is well linked with all capitals of the world through airways. The name of this town emerged on the world map in 1972, when world famed Maruti Industry was set up in Gurgaon with the collaboration of Suzuki Company of Japan. Now with the coming up of multinational companies like Hero Honda Motor, Honda Motors Ltd, Denso etc. in automobile sector and Microsoft, I.B.M. Nokia, Canon, Dupont, Sapient, British Airways, American Express, ABN Amro Bank, Alcatel, Nestle, Convergys, Hewitt, Vertex, Fidelity Investment, E.Vallue, Keine World India, Becton Dickinson India Private Limited in software development sector; the Gurgaon-Manesar Urban Complex has become abode of International Companies. With the result, the biggest cyber city of India spreading in an area of about 90 acres in addition to numerous cyber parks are being developed in Gurgaon itself within a radius of 15 kilometers from the International airport in private sector to accommodate the needs of software development units of multinational companies. The availability of high level infrastructure of Airways, Railways, Highways, In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and development in sectors whichare reserved for the public and semi-public zone shall be taken only and exclusively through the Government or a Government undertaking or a public authority approved by the Government in this behalf and no permission shall be given for development of any colony within these sectors. (2) For the development of sectors reserved forcommercial use, private developers shall be permitted to develop to the extent of 50% of the sector area as per the layout plan approved by competent authority, after obtaining license under Act No. 8 of 1975. Balance 50% area shall be developed exclusively by the Government or a Government undertaking or by a public authority approved by the Government. (3) Notwithstanding the provision of clause (1) and (2) above, the Government may reserve at any time, any other sector for development exclusively by it or by its agencies indicated above." E] The Haryana Act was enacted in the year 1975 to regulate the use of land in order to prevent ill-planned and haphazard urbanization in and around towns and for development of infrastructure sector and infrastructure projects for the benefit of the State of Haryana and for matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The opinion of LR was considered and it was accordingly decided that DTCP should be the competent authority to grant licence under the Act. On a suggestion from DTCP, however, it was felt that the grant of licence may have wider implications for State Government. It was, therefore, decided that such licences may be granted with prior internal concurrence of the State Government at Minster's level. The State Government will however, exercise appellate powers under the Act in accordance with the opinion of the LR. 3. CONFORMITY OF THE SITE TO THE DEVELOPMENT PLAN/SECTOR PLAN: The LR's opinion on the matter was discussed and it was clarified by the LR that legally the colony to be licensed has to conform to the Development Plan and not to sector demarcation. It was pointed out that the land under application may not always be in a regular shape or in one sector. No minimum limit on proportion of the total area to the area of the sector could, therefore, be stipulated. 4. SIZE OF THE COLONY: It was decided that except for additional licences for contiguous area/pockets, the minimum area required for the grant of licence shall be 100 acres for an applicant company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hment of such colonies. Earlier a decision was taken by the CMM (copy of memorandum and decision is placed at Annexure B and C) to release the land from acquisition where developers/colonizers have purchased land before the issue of notification under Section 4 of the Land Acquisition Act, but submitted applications for grant of licence for setting up of residential colony afterwards. But it is a general decision and it is felt that in view of the reasons explained above, the licences for commercial colonies should be treated differently. It is therefore, proposed that if the department intends to issue licence for commercial colony with the internal concurrence of the Government over a land where the owner had purchased it before the notification under Section 4 of the Land Acquisition Act was issued, the release of such land may be allowed before issue of letter of intent. Policy dated 06.03.2000 It has also been observed that the resources of HUDA have reduced in the recent past, and acquisition activity and development of residential sectors has become costly and time consuming affair due to litigation and, therefore, it would be appropriate to assign a greater role to pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50% for development of sectors reserved for commercial use and rest could be developed only by the Government or Government undertaking or by a public authority approved by the Government. B. In terms of provisions of the Haryana Act and more particularly Section 3(2), "Capacity to develop a colony" would be a factor relevant for consideration whenever an application for licence was preferred by any owner. Though the provisions of Haryana Act do contemplate coordination of all efforts with regard to development and implementation of infrastructure, sectors and projects with involvement of private participation, the directions issued by the Government have laid down, in clear terms, the extent and scope of such private participation. C. In accordance with Section 40 of the NCR Act, the concerned States are expected to give effect to any Regional Plan by taking resort to power of acquisition. The inter-play between exercise of such power of acquisition and private participation by permitting licences to owners/colonizers was a matter dealt with by Policy Guidelines issued by the Government from time to time. In terms of policy statements dated 07.08.1991, 06.01.2000 and 06.03.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levant policies holding the field and the law laid down by this Court in para 21 of its judgment in Uddar Gagan (Supra), such purchases did not entitle the concerned builders/private entities to prefer any application for licence, nor could pendency of such applications be taken as a relevant factor while arriving at a decision whether acquisition initiated pursuant to notification dated 27.08.2004 be proceeded further or not. However, the record indicates that such purchases and the pendency of applications for licence under the Haryana Act, was a factor which did weigh while decisions dated 24.08.2007 and 29.01.2010 were taken. A factor which ought to have been discarded in terms of the declared policy statements, became the fulcrum for said decisions. We have therefore, no hesitation in holding that said decisions are inconsistent with and opposed to relevant policy statements. We also reject the submission advanced on behalf of builders/private entities that these decisions were consistent with the Regional Plan under the NCR Act and the Final Development Plan for Gurgaon-Manesar. 23. But the issues raised in the present case go way beyond mere invalidity or illegality of thos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... land out of 688 acres of land as specified in declaration under Section 6 of the Act was purchased by builders/private entities. (d) Around the time when those purchases were made by builders/private respondents, Awards were declared on 09.03.2006 and 24.02.2007 in respect of lands from adjoining Villages where the acquisition was also initiated for the same public purpose. The compensation awarded was at the rate Rs.12.5 lakhs per acre. (e) Although the relevant policies did not permit anyone who purchased the concerned lands after initiation of acquisition to prefer an application for licence, the builders/private entities merrily went about purchasing the interest of concerned landholders after such initiation. Most of these companies were incorporated after the acquisition was initiated and had no experience in colonization. Yet substantial and sizeable holding was purchased by them. This is reflective of the intent to cash in on an opportunity made available and garner as much holding as possible. The subsequent transactions of sale by them are also indicative of the attempts to profiteer in the matter rather than any bona fide attempt to develop and colonize the property. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apparently had done nothing in the matter is quite shocking. Neither had these entities procured the lands from the original landholders nor were they ultimate developers who wanted to develop the property. Such entities can certainly be termed as "middle men" who walked away with tremendous amount of money or benefit at the rate of Rs.3½ crores per acre. Was that a mere bonanza or a deal denoting quid pro quo? (k) It is true that the price of Rs. 4½ crores per acre was paid in respect of land as well as the licences and well after the dropping of the acquisition and withdrawal of writ petitions pending in the High Court. However this price or the rate shows the tremendous difference between the return received by the original landholders and the actual potential of the land. (l) In terms of paragraph VIII of Annexure B to the Final Development Plan for Gurgaon-Manesar Urban Complex the extent of private participation was extremely limited and in terms of relevant policy under the Haryana Act no licence could be issued in case any purchase of land was made after the initiation of the acquisition. Yet the concerned Authorities not only entertained such applications ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be followed is the Collector's rate fixed for the purpose of registration charges. The farmer cannot sell the land in open market as on issuance of Section 4 notification all sale transactions are invariably banned. These moments of fear and anxiety must have prompted Respondent 11 to indulge in the best bargain. For the farmers the offer was like "better you give the wool than the whole sheep". There was no free trade for the farmers. Their choice was limited: to accept the State compensation at the Collector's rate or a better offer given by State-sponsored private builder. There was inequality of bargaining power. The determination of land value was not at all in the control of farmers. They were groping in the dark. They had no clue that the land will be released. They accepted the unreasonable and unfair unilateral terms and lost their land. 80. ... Secondly, it is not a case of challenging the sale deeds for the breach of any bilateral terms and conditions or on the conventional grounds where a question of fact has to be proved. The incidental relief to declare the sale deeds as null and void is an offshoot of the broader issues raised by the petitioners including those h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved. The operative direction of the High Court to quash the acquisition to the extent it has neither been challenged nor concerns the land transferred to a private builder by abusing the power of acquisition or on account of any extraneous considerations does not appear to be justified. Similarly the direction of permitting the builder to retain the land of those landowners who are not able to refund the sale consideration received by them may permit the builder to illegally retain the land. Moreover, it may not be practicable in the present fact situation to restore the land to the landowners but they can be duly compensated while restoring the land to the State to use it for notified public purpose. Person whose land is taken for houses for others cannot be rendered homeless and unemployed. This will be sheer exploitation. In view of the conduct of the builder, agreeing with the view of the High Court, we do not propose to allow any interest to the builder while permitting refund/reimbursement to it. From the impugned judgment there is nothing to show that the developments which are now relied upon had taken place on the date of filing of the writ petition. It has been specifical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lder in respect of landcovered by the award in exercise of powers under Section 48 are quashed. 33.3. Consequently, all licences granted in respect of the landcovered by acquisition will stand transferred to HUDA. 33.4. Sale deeds/other agreements in favour of the builder in respectof the said land are quashed. The builder will not be entitled to recover the consideration paid to the owners but will be entitled to reimbursement as indicated hereinafter. Creation of any third-party rights by the builder also stands quashed. 33.5. The sale consideration paid by the builder to the landownerswill be treated as compensation under the award. The landowners will not be required to refund any amount. The landowners who have not received compensation will be at liberty to receive the same. The landowners will also be at liberty to prefer reference under Section 18 of the 1894 Act within a period of three months, if such reference has not been earlier preferred. 33.6. The builder will be entitled to refund/reimbursement of anypayments made to the State, to the landowners or the amount spent on development of the land, from HUDA on being satisfied about the extent of actual expenditur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can be charged with legal mala fides. In such a situation there is no question of any personal ill-will or motive. In Municipal Council of Sydney v. Campbell 1925 AC 338 at p. 375 it was observed that irrelevant considerations on which power to acquire land is exercised, would vitiate compulsory purchase orders or scheme depending on them......." b] In Royal Orchid Hotels Limited and Another v. G. Jayarama Reddy and Others (2011) 10 SCC 608, this Court was called upon to consider question whether land acquired by the State Government for specified purpose namely Golf-cum-Hotel Resort could be transferred to a private individual. The observations in paragraph 38 are relevant for the present purposes:- "38. The courts have repeatedly held that in exercise of its power of eminent domain, the State can compulsorily acquire land of the private persons but this proposition cannot be overstretched to legitimize a patently illegal and fraudulent exercise undertaken for depriving the landowners of their constitutional right to property with a view to favour private persons. It needs no emphasis that if land is to be acquired for a company, the State Government and the company is bound ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... road, blurred sense, Benjamin Disraeli was not off the mark even in law when he stated: 'I repeat ... that all power is a trust-that we are accountable for its exercise-that, from the people, and for the people, all springs, and all must exist.' Fraud on power voids the order if it is not exercised bona fide for the end designed. Fraud in this context is not equal to moral turpitude and embraces all cases in which the action impugned is to effect some object which is beyond the purpose and intent of the power, whether this be malice-laden or even benign. If the purpose is corrupt the resultant act is bad. If considerations, foreign to the scope of the power or extraneous to the statute, enter the verdict or impel the action, mala fides or fraud on power vitiates the acquisition or other official act." ......... 49. Before concluding, we consider it necessary to reiterate that the acquisition of land is a serious matter and before initiating the proceedings under the 1894 Act and other similar legislations, the Government concerned must seriously ponder over the consequences of depriving the tenure-holder of his property. It must be remembered that the land is just like moth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, or the retention of money or property of another against the fundamental principles of justice or equity and good conscience". A defendant may be liable "even when the defendant retaining the benefit is not a wrongdoer" and "even though he may have received [it] honestly in the first instance". (Schock v. Nash 732 A 2d 2017 (Delaware 1999), A 2d, 232-33.) 154. Unjust enrichment occurs when the defendant wrongfullysecures a benefit or passively receives a benefit which would be unconscionable to retain. In the leading case of Fibrosa Spolka Akcyjna v. Fairbairn Lawson Combe Barbour Ltd. 1943 AC 32, Lord Wright stated the principle thus: (AC p. 61) "... Any civilised system of law is bound to provide remedies for cases of what has been called unjust enrichment or unjust benefit that is to prevent a man from retaining the money of or some benefit derived from another which it is against conscience that he should keep. Such remedies in English law are generically different from remedies in contract or in tort, and are now recognised to fall within a third category of the common law which has been called quasi-contract or restitution." 155. Lord Denning also stated in Nelson v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ong as the deprivation of the other has not been fully compensated for, injustice to that extent remains. Which label is appropriate under which circumstances would depend on the facts of the particular case before the court. The courts have wide powers to grant restitution, and more so where it relates to misuse or non-compliance with court orders." 30. As held in State of Punjab v. Gurdial Singh (Supra) when a custodian of power is influenced in its exercise by considerations outside those for promotion of which the power is vested, such exercise is nothing but colourable exercise of power and that the power of the State to acquire lands of private persons compulsorily cannot be overstretched to legitimize a patently illegal and fraudulent exercise undertaken to favour certain private persons. This principle has been followed consistently. While dealing with fact situation arising in the context of exercise of power under the provisions of the Act and its interplay with the power under the provisions of the Haryana Act and the concerned policies, the observations of this Court in the decision in Uddar Gagan (supra) are crucial. They cull out principles that entertaining an appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be bestowed, guided the exercise of power in arriving at decisions dated 24.08.2007 and 29.01.2010. The inescapable conclusion, therefore, is that there was an unholy nexus between the governmental machinery and the builders/private entities in devising a modality to deprive the innocent and gullible landholders of their holdings and jeopardize public interest which the acquisition was intended to achieve. Mr. Dhruv Mehta, learned Senior Advocate is right in his submission that the entire mechanism was deliberately employed so that gullible landholders could be deprived of their holdings by a set of builders/private entities and after having seen that the desired result was achieved, the acquisition was dropped and later completely withdrawn. The decisions on the part of the State arrived at on 24.08.2007 and 29.01.2010 were clearly a result of fraud on power and cannot be said to be bona fide exercise of power. In our view, the initiation of class action and filing of Writ Petition in the present matter was perfectly justified and we reject all the submissions made by the learned Counsel appearing for various builders/private entities. 32. We thus hold that: a] The transaction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e dropped. The fact that other acquisitions have been completed and have attained the required objective is a pointer in the direction that there was nothing wrong with the initiation but somewhere along while the process was on, it was completely hijacked by vested interests. We cannot, therefore, grant mere declaration invalidating the transaction and grant relief of restoring status ante. The real and substantial relief would be in restoring the situation where the process of acquisition is made free from such supervening vested interests and is enabled to achieve the objective that the acquisition was intended to sub-serve. 34. At this stage an aspect needs elaboration and clarification. In Uddar Gagan (supra) the proceedings for acquisition under the Act had culminated in passing of an award. After the declaration of award, the lands were withdrawn from acquisition under the provisions of Section 48 of the Act. In terms of the directions issued by this Court in paragraph 33 in Uddar Gagan (supra) the withdrawal under Section 48 of the Act was set aside and the acquisition and award were sustained by this Court. In essence therefore, the lands in question continued to be under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... follow the outcome of Writ Appeal No.1654 of 2008. The compensation under the Act will be paid by taking the date of the order of the learned Single Judge of the High Court i.e. 22-2-2001." Thus, in cases where there was no valid acquisition but the land was taken possession of and developed, restoration of land to the landholders was not found to be the appropriate, adequate and complete relief and this Court directed that process of acquisition be initiated taking or treating certain date to be the relevant date for initiation of the acquisition. If the power can go to the extent of directing acquisition in such manner, in a case where an acquisition having been properly and validly initiated if the supervening circumstances show that there was complete fraud on power in dropping the acquisition, can the power of the superior court not extend to/not be extended for passing appropriate directions to complete the acquisition and sub-serve the public interest. But for such fraud on power, the matter in the present case was ripe for pronouncement of award when the acquisition was dropped just two days before the date of pronouncement. All the steps leading to the publication of da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in case of certain other lands where no transactions were entered into, as a result of dropping of the acquisition, those land holders are presently in occupation without there being any cloud of acquisition. If we restore status ante where the entirety of 688 acres of land continues to be under acquisition, the interest of such landholders is bound to be put to some prejudice. Those landholders are not parties to this litigation, nor their interest in any manner, is represented in the proceedings. They would now be visited with the prospect of losing their holdings. Those who sold away their holdings to the builders/private entities after the acquisition was initiated, naturally would not be prejudiced at all nor can the builders/private entities who purchased the land after the land was initiated can put up a plea of prejudice. However those who had never sold the holdings and continued to face the prospect of acquisition will certainly be put to prejudice. It is possible that some such landholders may have sold away their holdings or may have applied and secured licences for construction. In cases, where third party interests have thus intervened, there would be some more conce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on that principle every beneficiary/ purchaser in subsequent transaction must restore such benefit, an exception has to be made in favour of individual purchasers of flats or apartments who are being left undisturbed while moulding the relief. Any payments made by them can be adjusted towards the amounts payable to the colonizer and their possession can be regularized by HUDA/HSIDC on suitable conditions by making allotment to them. This aspect will stand covered by directions issued hereafter. 39. Having bestowed our attention to various competing elements and issues we deem it appropriate to direct: (a) The decisions dated 24.08.2007 and 29.01.2010 referred to hereinabove are set aside as being brought about by mala fide exercise of power. In our considered view, those decisions were clear case of fraud on power and as such are annulled. (b) The decision dated 24.08.2007 was taken when the matters were already posted for pronouncement of the award on 26.08.2007. Since all the antecedent stages and steps prior thereto were properly and validly undertaken, and since the decision dated 24.08.2007 has been held by us to be an exercise of fraud on power, it is directed that an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... still entitled to something more than what they had received from the builders/private entities, the differential sum shall be made over to them by the State of Haryana towards acquisition of their interest in the lands in question. If however, what the landholders had received towards consideration from the builders/private entities is found to be in excess of what is awarded by the Reference Court, the remainder shall not be recovered from them. (g) Consistent with the directions issued by this Court in Paragraphs 33.6 and 33.7 in Uddar Gagan (supra), the builders/private entities will be entitled to refund/reimbursement of any payment made to the landholders or the amounts that had been spent on development of the land, such payments shall be made by HUDA or HSIDC on being satisfied about the extent of actual expenditure not exceeding HUDA or HSIDC norms on the subject as the case may be. Refund will however be in respect of amount at which the landholders sold the land and not of subsequent sales. As regards subsequent transactions, the subsequent purchasers will have remedies against their respective vendors. Claims of builders/private entities entitled to refund will be ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of "Rehabilitation and Resettlement of Land Acquisition Oustees" policy of the State/HUDA/HSIDC to the landholders. Area so required shall be reserved out of the acquired landitself. (l) The State may revisit its policy of change of land use and giving colonization licence in respect of land which is subject matter of acquisition. (m) We are given to understand that a Commission of Enquiry was appointed by the State of Haryana to enquire into certain facts concerning acquisitions in respect of lands in Gurgaon Manesar Urban Complex and that the matter is presently subject matter of challenge in a pending writ petition in the High Court of Punjab and Haryana on account of which further steps are held up. Without expressing any opinion on the merits or demerits of such challenge, we request the High Court to deal with and dispose of the matter as early as possible and preferably within two months from the date of receipt of a copy of this order so that public interest may not suffer by delay in such decision. 40. Before we close, we must record our sincere appreciation for the efforts put in and for the invaluable assistance rendered by the learned Amicus Curiae. His analytical ..... X X X X Extracts X X X X X X X X Extracts X X X X
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