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Judgment
The petitioner, who is a resident of Feroke Municipality, states that he has a family house and property within the limits of the 1st respondent
Municipality. The Municipality apparently owns 31 cents of land in R.S.No.296/1A of Ramanattukara Village, and on the northern side of the said
property, the 3rd respondent owns 2.25 acres in R.S.No.295/2 and 296/1A1 of the same Village. The petitioner''s mother too owns property
comprising of 75 cents, on the eastern side of the Municipality''s property.
It would appear that the 1st respondent Municipality wanted to construct a Municipal Office that would accommodate more people than the
present office. With a view to acquiring property for constructing a bigger office building, the respondent Municipality, by Ext.P12 Resolution
dated 9.12.2015, constituted a Sub Committee for the purposes of exploring the availability of suitable land for the Municipality. Thereafter, by
Ext.P13 Resolution dated 12.2.2016, and pursuant to identifying the 3rd respondent''s land, the Municipality resolved to purchase the land
belonging to the 3rd respondent, and initiate steps for acquisition of the land. The 3rd respondent, on his part, appears to have submitted an offer
through Ext.P2 letter dated 24.2.2016, and the Council of the Municipality, by Ext.P14 decision dated 3.3.2016, accepted the said offer. The
Municipality thereafter, by Resolution dated 28.5.2016, decided to acquire 102 cents of land belonging to the 3rd respondent, by giving 25 cents
of its land to the said respondent, as part of the consideration for the property acquired from the 3rd respondent. The Secretary of the respondent
Municipality thereafter sought for a valuation certificate, in respect of the land proposed to be acquired, from the Village Officer as evidenced by
Ext.P5 dated 27.12.2016. In response to the said request of the Secretary, the Village Officer submitted two reports, produced as Ext.P6 dated
27.12.2016 and Ext.P7 dated 9.2.2017, detailing the value that could be fixed for the lands for the purposes of the exchange transaction. By
Ext.P8 decision dated 17.7.2017, the Council of the respondent Municipality approved the decision of the Municipality to go in for the exchange
arrangement, and also decided to seek approval of the State Government for the same. The State Government, by Ext.P9 letter dated 21.8.2017,
is seen to have granted approval to the arrangements envisaged by the Municipality. It is not in dispute that thereafter, an exchange deed was
executed between the 1st respondent Municipality and the 3rd respondent as evidenced by Ext.P10.
In the writ petition, the petitioner impugns Ext.P8 decision of the respondent Municipality, as also Ext.P9 decision of the Government, granting
approval to the aforementioned arrangement of the Municipality. It is contended that, in resorting to the said arrangement, the respondent
Municipality had not complied with the mandatory procedure that was contemplated under the Kerala Municipality (Acquisition and Disposal of
Property) Rules, 2000 [hereinafter referred to as the ''2000 Rules''], in that, they had not issued any public notice or invited any tender or held any
auction in connection with the disposal of their property. It is also stated that the respondent Municipality did not explore the option of acquiring
land through land acquisition proceedings, and further, did not consider an offer that had been made by the petitioner''s mother to surrender 5000
sq. ft. of office space to the Municipality, free of cost, in the event of the Municipality giving permission for construction of a commercial complex
on her land. The Government''s action in granting approval to the Resolution of the Municipality is also impugned as being vitiated on account of a
non-application of mind by the Government to the factors that were necessary to establish the arrangement as legal. On the merits of the decision
of the Municipality, it is stated that the valuation of the property of the Municipality was not done properly, and as a result, the Municipality has
suffered great loss through the arrangement entered into with the 3rd respondent.
In support of his contentions, the learned senior counsel for the petitioner would place reliance on the decisions in Bhagubhai H. Devani v.
Porbandar Municipality and Others - [AIR 1984 Gujarat 134] to establish his locus standi to question the actions of the Municipality and the
decision in J. Jaichand etc. v. The Town Municipality, Robertsonpet K.G.F. and others - [AIR 1976 Karnataka 138] and the decision in A.A.
Gopalakrishnan v. Cochin Devaswom Board and Others - [(2007) 7 SCC 482] in support of his contention with regard to the necessity for an
interference by this Court with the decision of the respondent Municipality.
A counter affidavit has been filed on behalf of the 1st respondent Municipality and its Secretary. Therein, a reference is made to a legal notice
sent to the Municipality by the petitioner''s son, containing, inter alia, the objections raised by the petitioner to the proposed course of action of the
Municipality, and including a reference to the offer made by the petitioner''s mother for surrender of 5000 sq. ft. of office space, free of cost, to the
Municipality. It is stated that, in response to the legal notice sent by the petitioner''s son, Ext.R1(b) reply was given by the respondent Municipality,
inter alia indicating that the offer of the petitioner''s mother was not acceptable to the respondent Municipality. It is stated that Exts.P8 and P9
decisions have been acted upon by the Municipality, and the fact that the petitioner did not choose to challenge the decisions through a statutory
appeal in terms of Section 54 of the Municipality Act, is also highlighted to cast doubts on the petitioner''s bona fides in filing the writ petition.
Section 215 of the Municipality Act, read with the 2000 Rules, is relied upon to contend that the Municipality had the power to acquire property
even through a bilateral agreement, and that, there was no compulsion on the Municipality to hold an auction in connection with the disposal of its
property, for the purposes of acquiring property belonging to the 3rd respondent. The factual aspects that led to the decision of the Municipality to
acquire land from the 3rd respondent are stated in paragraph 10 of the counter affidavit of the Municipality, and, in particular, it is stated that, on
formation of the Municipality with effect from 1.11.2015, the Municipality faced space constrains since it was hitherto functioning in the old
Panchayat office. As the functions of the Municipality expanded, it became evident that the Municipality would require more space to
accommodate its staff and members. It was found that there was no Council Meeting Hall or independent cabinet or rooms for Standing
Committee Chairman and members. There was also no parking space in the existing building. It is pointed out that these aspects were considered
by the Municipal Council at its meeting held on 9.12.2015, and pursuant to a consideration of a recommendation to the Sub Committee that was
constituted, and all party meeting was convened to discuss the issue, and in the said meeting, the Committee unanimously resolved to go ahead
with the proposal of the Municipality. In paragraph 12 of the counter affidavit, the Municipality narrates the procedure that was adopted for
obtaining Ext.R1(e) valuation certificate as also Ext.R1(f) BTR Register in respect of the properties sought to be acquired. It is stated that,
thereafter, the Performance Audit Team of the Local Self Government conducted a verification and inspection on 29.5.2017, and based on the
recommendations of the State Performance Audit Team to accept the proposal, the State Government, vide Ext.P9 communication, approved the
decision of the Municipality. It is stated that the Assistant Engineer of the Local Self Government Department has also certified the the land
acquired by the Municipality is fit for consideration of an office building. With specific reference to the offer made by the petitioner''s mother, it is
stated that the offer made was a conditional offer for construction of a commercial building and offering 5000 sq. ft. in the said building to the
Municipality on the third floor. It is stated that the Municipality could not accept the said offer, since, it was insufficient for the purposes of the
Municipality and unsuitable for housing the Municipal Office, and, therefore, the Municipality deemed it fit not to consider the offer of the
petitioner''s mother.
In the counter affidavit of the 3rd respondent, the averments are more or less similar to those in the counter affidavit of the respondent
Municipality.
The petitioner has also filed a reply to the counter affidavits aforementioned, refuting the averments in the counter affidavit and producing the
documents evidencing the Resolutions passed by the respondent Municipality in connection with the exchange agreement.
I have heard the learned senior counsel Sri. K.Gopalakrishna Kurup, assisted by Adv. Sri. K.Suresh, for the petitioner, Sri. P.C. Sasidharan,
the learned Standing counsel for the respondent Municipality, the learned senior counsel Sri. T. Krishnanunni, assisted by Adv. Sri. Vinod
Ravindranath and also the learned senior counsel Sri. K.Ramakumar, duly assisted by Adv. Sri. T.Ramprasad Unni for the additional 5th
respondent in the writ petition.
On a consideration of the facts and circumstances of the case as also the submissions made across the bar, I find, at the very outset, that the
respondents vehemently dispute the local standi of the petitioner to maintain a writ petition challenging the decision taken by the respondent
Municipality as referred above. It is pointed out that the petitioner is not a permanent resident in the respondent Municipality, and further, there is
no averment in the writ petition that any of the rights, much less fundamental rights, of the petitioner have been violated through the decision of the
respondent Municipality to enter into the exchange agreement with the 3rd respondent. The contention of the respondents is essentially that the
averments in the writ petition make it out to be in the nature of a public interest litigation, and this Court cannot entertain the said writ petition
without the petitioner first establishing his credentials to represent the public in such proceedings, as also in the absence of necessary pleadings to
indicate that the decision of the respondent Municipality was not in public interest. While I find force in the said contentions of the respondents, it
was felt that, if the petitioner could establish, that either he or his mother was in someway prejudiced on account of the non-consideration of the
latter''s offer for providing space to accommodate the Municipality''s requirements, consequent to a non-compliance by the respondent
Municipality of the mandatory procedure prescribed under the 2000 Rules, the writ petition could still be maintained at the instance of the
petitioner, although not as a public interest litigation. The learned senior counsel was therefore directed to address the court on the issue of alleged
non-compliance by the respondent Municipality with any mandatory statutory procedure. The learned senior counsel responded by contending
that, while deciding to acquire the land belonging to the 3rd respondent, on exchange basis, by giving him 25 cents of the land belonging to the
Municipality, the Municipality did not follow the procedure of auction/public notice etc. as mandated under the 2000 Rules. To appreciate this
contention of the learned senor counsel for the petitioner, it would be necessary to peruse the relevant statutory provisions, which are extracted
here under:
The Kerala Municipality Act:-
Power of Municipality to acquire and dispose of property.- [(l) A Municipality may in the manner prescribed, acquire any
property such as land or building within or outside its Municipal area or dispose of any of its properties with the prior approval of the
Government for providing any arrangement or facility for a public purpose.]
(2)(a) A Municipality may construct commercial or other buildings and let them out to the public who need them on licence and may
charge such fees as it may fix for the use and occupation of the same, in the manner prescribed;
(b) [XXX]
Provided that after the said period, a licence may be renewed subject to such terms and conditions as may be fixed at that time;
(c) In all cases except renewal of licence or rehabilitation of a licensee, licence shall be granted only by public auction or tender.
(3) Every licence under sub-section (2) shall contain terms and conditions governing the use and occupation of the building or room
or space therein and the rate and time of payment of fees and such terms and conditions shall be reduced in writing in the form of an
agreement in stamp paper of the appropriate value.
(4) No building or room or space let out under subsection (2) shall be sub-let by the licensee to any person nor the nature of use
changed without the prior approval of the Municipality:
Provided that the Municipality may at the instance of a licensee transfer the licence to any other person subject to such terms and
conditions as it may deem fit to impose and upon such transfer, it shall be deemed to be a fresh licence for all purposes.
(5) Where at any time it appears to the Secretary that any building, room or space let out to any person under subsection( 2) has
been sub-let, he shall by order, immediately cancel the licence issued to such person and direct the person or persons in use and
occupation of the building, room or space, as the case may be, to vacate within such time as may be specified in the order;
Provided that the Secretary shall, before issuing an order cancelling the licence and evicting the user or occupier give notice to such
person requiring him to show cause within a reasonable time to be specified in the notice, why such an order should not be made.
(6) Where an order issued under sub-section (5) is not complied with within the time specified therein, the Secretary shall cause such
person or persons to be removed from the building, room or space with the assistance of police and close down the building, room or
space as the case may be, and thereupon all properties found in such premises shall, belong to the Municipality and shall be disposed
of and the proceeds credited to the municipal fund.
(7) Every person to whom a licence has been issued under sub-section (2) shall pay without demand the licence fee and other
charges at the rate specified in the agreement within such time as may be specified therein.
(8) Where any licensee defaults payment of licence fee for a period exceeding the period covered by the deposit made in terms of the
licence, the Secretary shall, by notice, in writing, require the defaulter to remit the dues together with such penalty or interest as
provided in the agreement within seven days of service of such notice and in case of failure, he shall immediately cause the premises
to be closed down temporarily and the person or persons in occupation shall be got removed with the assistance of police or
otherwise.
(9) Notwithstanding the closure of the premises under sub-section (8) the licensee shall continue to be the user and occupier of the
premises and shall be responsible for the safe custody of the belongings therein, but he shall not break open the premises and re-enter
therein and if he does so, he shall be deemed to have committed an offence under section 380 of the Indian Penal Code (Central Act
45 of 1860).
(10) Where the Secretary closed down a premises under sub-section (8), he shall, by notice, direct the licensee to clear off the dues
within such time as may be specified in the notice.
(11) Where the licensee remits the dues as required in the notice under sub-section(10), the Secretary shall immediately put him in
physical possession of the premises and if he fails to clear of the dues the Secretary shall cancel the licence forthwith and the order
cancelling the licence shall be communicated to him and if, for any reason, the order cannot be communicated to him in person it shall
be published in the premises closed down under sub-section (8) which shall be deemed to be a sufficient notice.
(12) Where the Secretary has cancelled a licence under subsection (11) he shall, with previous notice to the licensee and after public
notice, dispose of by auction or otherwise the belongings found in the premises closed down on the day notified, and the proceeds
thereof shall be adjusted towards the amount due from the licensee together with other charges and expenses in connection with the
sale and the balance, if any, shall be returned to him. If the sale proceeds are not sufficient to defray the dues together with other
charges or expenses in connection with the sale, the balance shall be recoverable from the licensee as if it were an arrear of property
tax.
The Kerala Municipality (Acquisition and Disposal of Property) Rules, 2000:-
CHAPTER - I
ACQUISITION OF PROPERTY
Power to acquire property:-(1) A Municipality may acquire any land or building which or outside its Municipal area either by
purchase or otherwise in order to introduce any public facility or for providing any service and may with the prior approval of the
Government dispose of any of its property either by sale or otherwise.
(2) The acquisition of land under sub-rule (1) may either be in accordance with the Act for the time being in force and the rules made
thereunder or under a bilateral agreement with the owner of the land.
(3) A Municipality, before acquiring any land under sub-rule (1) shall comply with the following conditions namely:-
(a) Except in the case of roads, bridges, culverts and quarries, the Municipal Health Officer, or in his absence the District Medical
Officer of Government Department, shall issue a certificate to the effect that the proposed property is suitable for the specified
purpose.
(b) The Municipal Engineer shall issue certificate to the effect that the proposed property is suitable for the specified purpose.
Acquisition of land by bilateral agreement:-(1) In all cases wherein it is proposed to acquire land by bilateral agreement,-
(a) ensure that the land is free from liability by obtaining encumbrance certificate for 18 years from the Sub- Register Office
concerned to prove the previous liability of the land proposed to be acquired.
(b) ensure that the owner has clear title and ownership right over the property proposed to be acquired by getting the title of the
property scrutinised by the Municipal Standing Council or by the District Government Pleader.
(c) ensure that the cost of land given for the land proposed to be acquired does not exceed that fixed in writing by the Revenue
Divisional Officer concerned; and
(d) ensure that the cost of the building or improvement, if any, upon the land does not exceed that fixed by the competent Municipal
Engineer.
(2) In case the Municipality is in need of any land or building for any public purpose, such land or building may be taken on lease
subject to the terms as may be decided by the Council. But when such land or building is taken on lease, the lease rent shall be fixed
only after proper valuation of the cost of the land or the building.
(3) The title deed of the property acquired by the Municipality under sub-rule (1) shall be in accordance with Form No.1 appended
to these rules.
(4) Nothing mentioned in the aforesaid rules shall apply to any property acquired by a Municipality upon a judgment of a court.
CHAPTER - II
DISPOSAL OF PROPERTY
Transfers to be either in public auction or through Tenders:- The transfer of the property of the Municipality, through sale,
except renewal of licences, rehabilitation of licensees, granting of lease, letting out on rent, shall be either in public auction or by
inviting tenders.
It will be evident from a perusal of the provisions of Section 215 of the Kerala Municipality Act that the Statute mandates that the Municipality
can acquire any property within or outside its Municipal area or dispose of any of its property with the prior approval of the Government for
providing any arrangement or facility for a public purpose, subject to it following the procedure prescribed in the Rules. In the 2000 Rules, Rule 3,
which falls under the Chapter governing acquisition of property, mandates that a Municipality may acquire any land or building within or outside its
Municipal area either by purchase or otherwise and may, with the prior approval of the Government, dispose any of its property either by sale or
otherwise. Sub rule (2) of Rule 3 makes it clear that the acquisition of land under sub rule (1) may either be in accordance with the Act for the time
being in force and the rules made thereunder or under a bilateral agreement with the owner of the land. The procedure contemplated under sub rule
(3) of Rule 3, before a Municipality can acquire any land under sub rule (1), involves the obtaining of certificates from various authorities to show
that the proposed property is suitable for the purpose for which it is proposed to be acquired. The procedure specified does not include the
obtaining of a prior approval from the Government before exercising the power to acquire any land. Rule 5 of the 2000 Rules specifically deals
with cases where the Municipality decides to acquire land by bilateral agreement. Therein also, the Rule indicates the procedure to be followed by
the Municipality, and even the said procedure does not contemplate a prior approval from the Government. These provisions in the Rules stand in
sharp contrast to the statutory provisions dealing with disposal of Municipal property, wherein, on a reading of Section 215 with Rule 11 of the
2000 Rules, one finds the requirement of obtaining prior approval of the Government, as also resorting to a public auction while disposing any of
the properties of the Municipality. On a conjoint reading of the provision of Section 215 of the Municipality Act with Rules 3, 5 and 11 of the
2000 Rules, it becomes apparent that the requirement of obtaining a prior approval from the Government would arise only in cases where the
Municipality proposes to dispose its properties. Even the requirement of holding an auction and issuing of public notice arises only in such cases of
disposal of property by the Municipality. When it comes to acquisition of property, for the benefit of the Municipality, the statutory provisions
envisage a greater freedom to the Municipality in the matter of deciding what properties to acquire and the manner in which such property is to be
acquired as also identifying the funds that would be used for the purposes of such acquisition. The freedom granted to the Municipality to take such
decisions for its benefit, flows from the recognition of the Municipality as a constitutional authority, through the amendments effected to the
Constitution by the Constitution (Seventy-fourth Amendment) Act, 1992. The statutory provisions appear to be guided by the general principles of
trust, whereby, the Municipality, as a trustee, is expected to act only in the best interests of the beneficiaries namely, its resident public. In the
instant case, a perusal of the reasons that prompted the Municipality to opt for the exchange arrangement, while acquiring the property belonging to
the 3rd respondent, clearly reveal that it was the Municipality''s need for a larger area to construct a bigger building that prompted it to offer a
smaller extent of land belonging to it, as part of the consideration for the acquisition of the larger extent of land belonging to the 3rd respondent.
Inasmuch as the 2000 Rules specifically provide for a bilateral agreement as a manner of acquisition, and there is no requirement of a prior
approval before an acquisition, the requirement of prior approval must be seen as necessary only if there is any disposal of Municipal property
required for the purposes of acquiring other property or if there is a disposal of property that was earlier acquired by the Municipality. In my view,
when property of the Municipality forms part of the consideration for the acquisition of property from the 3rd respondent, then it is only, if the offer
of the Municipality''s property as consideration is unlawful in any manner, that the bilateral agreement between the Municipality and the 3rd
respondent can itself be viewed as illegal. From the material available on records in the writ petition, I am unable to draw such an inference. I am
also of the view that merely because the Municipality disposed its property without following the auction procedure in this case, its actions cannot
be seen as illegal, more so when the disposal of its property was an integral aspect of the bilateral agreement with the 3rd respondent for
acquisition of the latter''s property.
Thus, I find myself unable the accept the contention of the petitioner that the decision of the Municipality to acquire the property of the 3rd
respondent, by offering a part of its own property as consideration, was taken without following the statutory procedure. That apart, the fact that
the petitioner did not choose to impugn the decision of the Municipality in statutory appeal proceedings under Section 54 of the Municipality Act
would be an additional ground to non-suit the petitioner in the instant writ petition. I also find that notwithstanding that the Municipality did not have
to consider any other request for acquisition of property, it appears to have considered the offer made by the petitioner''s mother and decided not
to accept the said offer, solely because, the said offer was not a feasible one vis-a-vis the requirements of the Municipality. The absence of
requisite pleadings to establish a violation of any of the rights of the petitioner on account of the actions of the respondent Municipality, as also the
absence of any material to indicate that the decision taken by the Municipality was so unreasonable that no reasonable person would have taken
such a decision, leads me to find that the prayers sought for in the writ petition cannot be granted at the instance of the petitioner. I therefore
dismiss the writ petition, in its challenge against the decision of the Municipality, but, under the circumstances, without any order as to costs.