Deep Sahkari Griha Nirman Samittee Simit vs State of Bihar and Others

D.G.R. Patnaik, J.—Heard learned Counsel for the parties.

Challenge in this writ petition is to the order dated 1.8.1996 and 21.11.1996 as contained in Annexure A and B to the counter affidavit whereby the respondent State Government has refused to settle the land in question in favour of the petitioner. Further prayer has been made for issuance of a direction to the respondents to execute lease deed in respect khas mahal land, total area being 8.62 acres (6.005 acres) under khata No. 445, plot No. 1390, 1453, 1457 and 1725 of village Kitadih and also including land, being 2.615 acres under khata No. 299 plot No. 779 of village Karandih in Jamshepdur Anchal, Jamshepdur.

The petitioner is a Co-Operative Society registered under the Bihar Co-operative Societies Act, 1935. The Society comprising of more than 400 members was constituted for the purpose of providing residential houses to its members.

The Society had requested the State Government to allot 28 acres of khas mahal land far construction of houses for its members. Against such request, the respondent State Government had settled 3 acres of khas mahal land on 16.8.1986 by letter No. 2061/ LR dated 16.08.1986 (Annexure 1 to the writ petition). The settlement was made against deposit of salami of Rs. 4.50 lakhs by the petitioner whereafter lease deed (annexure 3 to the writ petition) was executed by the authorized officer on behalf of the State Government in favour of the Society on 18.8.1987.

For allotment of further land, the Deputy Commissioner, East Singhbhum (respondent No. 4) by his letter dated 24.2.1987 forwarded a proposal to the Revenue Secretary, Department of Revenue, Govt of Bihar, Patna (respondent No. 2) for settlement of further 8.62 acres of khas mahal land under settlement No. 10 of 1984-85.

The proposal was placed before the Minister, In charge Revenue Department, along with the legal opinion of the Advocate General on 13.4.1987.

By his endorsement dated 21.4.1987, the Minister in Charge Revenue Department, approved the proposal for settlement of 8.62 acres of khas mahal land in favour of the petitioner. When the matter was again placed before him, the Minister in charge endorsed his approval on the office notings on 26.12.1987 and also directed for grant of permission to the Society for construction of houses over the land. The corresponding direction was accordingly issued to the Divisional Commissioner (respondent No. 3).

The Divisional Commissioner (respondent No. 3) constituted a joint committee consisting of five Deputy Commissioners with instructions to conduct enquiry and submit a report. The report of the joint committee was submitted on 30.4.1992 recommending settlement of the proposed 8.62 acres of khas mahal land in favour of the petitioner.

In pursuance of the recommendations of the joint committee and the instructions of the Divisional Commissioner, the Deputy commissioner, East Singhbhum directed the Additional Collector to complete the formalities for settlement of the land and to hand over possession thereof to the petitioner Society as per annexure 5B and 6A.

In the meantime, in response to the directions of the Administrative Authority, the petitioner Society deposited Rs. 3,67,000/- on 9.4.1992 by Treasury Challan (annexure 7) towards 10 percent of payable salami.

Thereafter, possession of the 8.62 acres of land was given to the petitioner at different intervals by annexure 8 series, Annexure 9 series and Annexure 10 series.

Earlier, in the year 1988, a PIL was filed against the respondent Government in which the respondent Govt had appeared and declared on affidavit (annexure 13) that the land in question was allotted to the petitioner. Upon such statements, the PIL was dismissed on 26.4.1988. Later, a title suit was also filed against the State Government and the petitioner Society wherein the respondent State Government in its written statement (annexure 15) had acknowledged and declared that the land in question had been settled in favour of the petitioner Society.

Upon possession of the land being given and on the basis of the purported assurance given by the concerned authorities of granting settlement of the land, the petitioner Society developed the land and constructed boundary wall at a cost of Rs. 14,87,641/98. The petitioner Society proceeded further to allot plots of land to its members and several such members have also constructed their homes over the land allotted to them and they are residing therein with their families.

When despite deposit of 10 percent salami amount and acquiring possession of land, the respondent State Government had delayed execution of lease deed, the petitioner Society filed a writ petition before this Court praying for a direction to the respondent authorities to execute the lease deed in respect of the land in favour of the petitioner.

During the pendency of the writ petition, it was in the counter affidavit of the respondent State Government filed on 5.5.1997 that the petitioner was informed that by the impugned Annexure A and B, the State Govt had decided not to allot and settle the land in favour of the petitioner.

The grievance of the petitioner is that after having given a firm assurance to settle the lands and even proceeding to the extent of delivering possession of the lands after accepting 10% salami amount, the respondent authorities of the State Government have unilaterally decided not to allot land to the petitioner Society. Such decision has been taken without any prior notice to the petitioner, and without assigning any reason as to why the purported assurance of settlement of land has been withdrawn.

The relief claimed by the petitioner in this writ petition is the following grounds:

(i) by their acts, deed and conduct, the concerned authority of the respondent State government had given definite assurance that the land would be settled and lease deed would be executed in favour of the petitioner. It was on such expectation that after obtaining delivery of possession of the land, the petitioner Society had spent more than Rs. 14,87,641/98 for development of the land and for construction of the boundary wall and many of its members who were allotted plots of land within the assigned area, had also constructed their residential houses. The respondents have created a legitimate expectation for the petitioner and its members. The doctrine of legitimate expectation creates a legal right in favour of the petitioner to demand the settlement of the lands by execution of the lease deed.

(ii) Principle of estoppel would also debar the respondents to resile from their commitments, promise and assurance;

(iii) The entire procedure admitted adopted for allotment of land of 8.62 acres of land, commencing with the proposal forwarded by the Deputy Commissioner and such proposal being vetted by the Divisional Commissioner and approved by the Minister in charge, Dept of Revenue, and after such proposal was approved by the Minister in charge having further been vetted and scrutinized before finalization by the joint committee set up at the level of the divisional commissioner, where-after 10 percent salami was accepted and delivery of possession of land was effected, are in consonance with the provisions of Rule 171 of the Khas Mahal Manual. Earlier, on allotment and settlement of 3 acres of land, the same procedure was adopted. Such allotment of settlement having been made by the competent authority under khas mahal manual, the respondent State Government cannot disown its liability on the ground that such acts and conducts of the concerned Government officers were not authorized by the competent authority.

(iv) The impugned letters refusing grant of settlement being unilateral decision is violative of the principles of natural justice since no prior notice was served upon the petitioner and the entire action of the respondent having been passed without any reason, is the outcome of non application of mind.

The respondents, in their counter affidavit, have acknowledged the fact that upon receipt of petitioner''s request, settlement of 3 acres of land was initially made and thereafter proposal was forwarded by the Deputy Commissioner for settlement of 8.62 acres of the Khas Mahal land and approval of the Minister in charge of the Revenue Department was obtained and thereafter salami was fixed and 10 percent salami was accepted from the petitioner Society and further more, possession of the land was also delivered to the petitioner Society. Having accepted to this extent, the respondents contend that possession of the land was delivered in anticipation of approval at the Government level. Such delivery of possession was conditional and certainly not to be taken as an order of grant of lease of Khas Mahal land as apparently misunderstood by the petitioner society.

Learned Counsel for the respondents would contend that the interpretation of the provisions of Section 171 of Khas Mahal Manual, as suggested by the petitioner is totally misconceived since the Divisional Commissioner is not the competent authority to either sanction settlement of land or grant lease in respect of Khas Mahal land. Khasmahal is a Government "Zamindari" and grant of lease of Khas Mahal land is a Government grant which is made in terms of Article 299 of the Constitution of India, on behalf of the Governor, by a person authorized on His behalf by the Government. It is sought to be further explained that the matter regarding settlement of khas mahal land to petitioner Society was considered at the Government level and after due consideration, the Government had refused to grant lease in favour of the petitioner Society and the order of refusal was communicated to the petitioner Society by letters (Annexures A to G to the counter affidavit) and the petitioner Society was given notice to re-deliver possession of the lands to the Government.

Referring to the earlier settlement of 3 acres of land, it is sought to be explained that the settlement was made by a person who was authorized on behalf of the Governor, since the Governor alone is the competent authority to grant settlement of khas mahal land. No authority subordinate to the Governor is empowered to sanction and alienate any part of the Government land.

As regards acceptance of salami, it is explained that the petitioner Society had deposited the amount towards 10% of the expected salami in anticipation of grant of lease in its favour. Such deposit did not create any right in favour of the petitioner Society to claim settlement and execution of lease in respect of land in its favour.

As to the reason for refusal of the settlement, it is explained that at the relevant time, there was a ban on grant of lease of Khas Mahal lands to any individual or society.

As observed, the claim of the petitioner is for settlement of Khas Mahal lands. Unlike other Government lands, the Khasmahal lands constitute a different category of Government lands, known in common parlance as Government Estate. The grant of settlement of such lands is governed under the Bihar (now Jharkhand) Government Estate Khas Mahal Manual.

Chapter VII of the aforesaid Manual regulates the alienation of Government lands.

Rule 168 of the Manual declares that no authority subordinate to the State Government, is empowered to sanction alienation of the Government lands.

Rule 171 of the Manual lays down the procedure for grant of sale/lease of the Khas Mahal Lands to the local bodies or other public Bodies or other Associations and private individuals.

As per the procedure laid down, the proposal for the grant of lease/sale of Khas Mahal lands has to be moved at the level of the Divisional Commissioner. Such proposal shall contain the detailed informations relating to the object of transfer, the total area of land proposed to be transferred, the market value, the estimated annual rental and shall be accompanied with a map showing the identity of the lands and should specify as to which Department of the State Government is in-charge of the land. The concerned Department of the Government, in-charge of the land, shall consider and decide upon the proposal and thereafter, the proposal shall be referred to the Revenue Department. The Revenue Department shall consult the Board or any Department of the Government affected, as the case may be, and also the Finance Department. If the proposals are accepted at all the Government levels as stated above, the Revenue Department shall thereafter, forward a memorandum to the originating Department, stating the terms and conditions on which the transfer may be made and the same shall thereafter be forwarded to the Commissioner of the concerned District. The Rule also lays down that no Officer of the Government can take action or order to alienate the land or assigned revenue, which is unsupported by the memorandum of the Revenue Department, nor can he take action on any order, which is not in accordance with the terms of the memorandum issued by the Revenue Department.

Rule 172 of the Manual declares that under powers exercised by the Governor under Article 292 of the Constitution of India, the Collector and the Deputy Commissioners have been authorized to execute the lease deeds in favour of the allotees of lands, on the terms and conditions stipulated in the memorandum of settlement, prescribed by the Revenue Department of the Government.

From the admitted facts of this case, it transpires that on receipt of the application from the Society for grant of lease of the Khas Mahal lands, the preliminary steps, as laid down in Rule 171 of the Manual, were initiated with the forwarding of the proposal by the Deputy Commissioner, to the level of the Divisional Commissioner and upwards to the level of the Minister in-charge of the Revenue Department of the State Government, Even though, the Minister in-charge of the Revenue Department had endorsed his approval of the proposal to the grant of lease to the petitioner, but thereafter, the further process/procedure, mainly the consultation with the Board and the Department of Finance, was not done nor the approvals of the aforesaid Departments obtained. Furthermore, no memorandum was forwarded by the Revenue Department, stating the terms and conditions on which transfer may be made and neither did the Divisional Commissioner or any subordinate authority receive any further instructions confirming the Government''s decision for the grant of the lease in favour of the petitioner-society.

It is obvious from the above that no final decision at the Government level was taken for the grant of lease or the 8.2 acres of Khas Mahal lands in favour of the petitioner-Society. The permissions purportedly granted by the Administrative authorities at the lower level for delivery of possession of the lands, and the acceptance of the 10 per cent Salami amount from the petitioner society were unauthorized and such unauthorized acts of the Officers of the Government cannot constitute any promise made by or on behalf of the Government to the petitioners for settlement of the said lands in its favour and neither can it create any right in favour of the petitioners. The purported assurance given, if any, by the Officers of the Government in anticipation of the Government''s approval, would not bind the State Government at all.

Even otherwise, in absence of an express contract entered into by the Government with the petitioner-society in exercise of the Executive power of the State Government, no right could accrue to the petitioner for enforcement against the State Government.

The petitioner-Society was certainly expected to know the Rules of procedure as laid down in the Khas Mahal Manual for the grant of lease of the Khasmahal lands and in absence of the approval by the State Government, it should not have proceeded to allow its members to construct houses on the lands, merely in anticipation of the Government''s approval for the grant of lease. The petitioners cannot, therefore, invoke the doctrine of legitimate expectation and neither can any relief for directing the Respondent-State Government to execute the lease-deed in respect of the lands be granted.

However, since the Rules under the Khas Mahal Manual does provide for alienation of the lands constituting Government Estate, to individuals or Associations, the application for the grant of the lease of the lands has to be considered by the Government in accordance with the Rules and reasons have to be assigned as to why the proposal for grant of lease in favour of the applicant is rejected.

As it appears, in the instant case, the proposal to grant lease in favour of the petitioner was rejected, purportedly on the ground that at the relevant time, there was a ban on the grant of lease of the Khas Mahal lands to individuals and Association.

Learned Counsel for the Respondents has not been able to inform as to by which order was such ban imposed and whether such ban, it any, does still continue to exist or has been withdrawn.

Considering the above facts, and also the fact that being led by the acts of the Government Officers, the petitioner Society had entertained a bona fide belief that the proposal for grant of lease of the lands would be finally approved at the Government level and upon such belief, the Society and its members have incurred substantial expenditure for construction of boundary walls and houses, it would be in consonance with the demand of equity that the Respondent-State Government should reconsider the proposal for grant of the lease of the proposed lands in favour of the petitioner Society and take an appropriate decision on the same in accordance with the existing Rules and taking into consideration the attending circumstances and pass a reasoned and speaking order assigning reasons. Such decision should be taken within a reasonable time, preferably within three months from the date of receipt/production of a copy of this order. Till such decision is taken and communicated to the petitioner effectively, the interim order dated 3.12.1996 shall continue.

With these observations, this writ application stands disposed of.

Let a copy of this order be given to the learned Counsel for the Respondent-State.