Vikalap Agro Industries (P) Ltd. and Others vs The State of Haryana and Others

V.K. Bali, J.—This litigation culminating into Letters Patent Appeal No. 239 of 1994 filed M/s Vikalap Agro Industries (P) Ltd. New Delhi and others under Clause X of the Letters Patent has rather an interesting background which needs to be detailed at the very outset.

On 28th of June, 1991 the appellants submitted an application to the Gram Panchayat at village Wazirabad for exchange of their land measuring 139 Bighas 12 Biswas with the matching land of Gram Panchayat, Wazirabad. The appellants are concededly sister concerns of the well known company working under the name and style of DLF Private Limited. On the very next day i.e. 29th of June, 1991, Gram Panchayat, Wazirabad passed a unanimous resolution in the meeting of the even date recording therein that the proposed exchange would be for the benefit of the Gram Panchayat and the inhabitants of the village. The resolution was forwarded to the Government of Haryana for its prior approval, a condition precedent for exchange of Gram Panchayat land as envisaged under 5 of the Punjab Village Common Lands (Regulations) Rules, 1964 (hereinafter to be referred as the Rules of 1964). On 31st December, 1991 the Government granted approval to the resolution of the Gram Panchayat referred to above under 5 of the 1964 Rules. On 27th March, 1992, mutations in respect of exchange of possession were sanctioned by the concerned revenue authorities. It is the case of the appellants that on 26th May, 1992, they were granted licenses for development and colonisation known as Qutab Enclave Complex, Phase V, Gurgaon by the Director Country and Town Planning, Haryana. On 17th/19th of November, 1992, Fateh son of Kanihya and others who have been arrayed as respondents Nos. 3 to 12 and for brevity of reference (herein after shall be referred to as plaintiffs) filed a civil suit in the court of Additional Senior Sub Judge, Gurgaon, seeking cancellation of the exchange resolved by the Gram Panchayat through its resolution dated 29th of June, 1991 and approved by the State of Haryana vide its order dated 31st December, 1991. During the currency of the suit, they also successfully moved an application for an interim injunction under Order 39 Rules 1 and 2 read with Section 151 of the Code of Civil Procedure. Senior Subordinate Judge after hearing the parties ordered maintenance of status quo. Aggrieved, M/s Vikalap Agro Industries (P) Ltd., and other sister concerns of DLF Limited (hereinafter to be referred as the appellants) carried an appeal against the orders passed by the Senior Subordinate Judge dated 16th February, 1993, before District Judge, Gurgaon. The said appeal, however, came to be disposed or by the Additional District Judge who vide order dated 23rd March, 1993 set aside the order passed by the Subordinate Judge thus, constraining the plaintiffs to file a Civil Revision against the order of the Additional District Judge. The Revision was filed on 7th April, 1993. During the course of arguments, the learned single Judge of this Court who was seized of the matter first impleaded the State of Haryana as respondent and then directed it to produce all the records pertaining to exchange and after perusal thereof treated the Civil Revision as Writ Petition under Article 226 of the Constitution of India. Vide impugned judgment, the exchange subject matter of challenge in the civil suit instituted by the plaintiffs was set aside. It is against this order of the learned single Judge that the appellants have filed the present Letters Patent Appeal.

During the pendency of the Letters Patent Appeal which was admitted on 23rd May, 1994, two separate writ petitions No. 1991 of 1995 instituted by Shishpal and others who too are residents of the village as the plaintiffs and the other writ petition bearing No. 16487 of 1995 instituted by Mehar Chand and others Proprietors of village Wazirabad for identical relief as sought for by the plaintiffs came to be instituted. Civil Misc No. 2656 of 1995 in L.P.A. No. 239 of 1994 under Order 1 8-A read with Section 151 of the CPC also came to be filed by another set of village proprietors seeking permission to intervene in the matter, in support of the judgment passed by the learned single Judge. Whereas in Civil Writ Petition No. 1991 of 1995 notice of motion was issued and the appellants and others have filed their written statements etc. C.W.P. No. 16487 of 1995 involving same controversy as in L.P.A. No. 239 of 1994 was ordered to be heard with the said L.P.A. We, thus, propose to decide all these matters by this common judgment, which is also likewise sought for by the learned counsel representing the parties. Before, however, we really come to the core of the controversy raised by Mr. M.L. Sarin, Senior Counsel appearing for the appellants, it will be useful to examine more details of the facts leading to sanctioning of the impugned mutations as culled out by us from the pleadings of the parties as also from the records maintained by the Gram Panchayat and the State of Haryana which were made available to us on directions given by the Court to the respective parties on that behalf. As stated above, the appellant - companies had submitted an application to village Wazirabad for exchanging land measuring 139 Bighas 12 Biswas on 28th June, 1991. The request of the appellant-companies came for consideration in the meeting conveyed by the Gram Panchayat, Wazirabad on 29th June, 1991. The resolution was passed on that very day. The relevant portion of the resolution when translated into English reads thus :-

"That the applications which were received from the companies seeking exchange of proprietorship of their land with the proprietorship of the land of the Gram Panchayat, Khasra Nos. of the land of the companies are as under :-

Khasra No.................

total area measuring 139 Bighas, 12 Biswas and 9 biswansi which is the proprietorship of the companies and the applicant companies have handed over the revenue record which was called for by the panchayat vide its resolution dated 22.5.1991. The applicant-companies seek exchange proprietorship of the above mentioned land with the panchayat land. Khasra Nos. of the Gram Panchayat land are as under :-

Khasra Nos...............

total area measuring 139 Bighas 12 Biswas which area is equivalent to the area of the companies. The land of the Gram Panchayat comprises Ghair Mumkin, nullas, pits and this area falls in between the area of the companies. As a result of the exchange the area of the panchayat shall become consolidated in one lot. The Gram Panchayat after the exchange of this area can give it on lease. It can also grow trees thereon since agriculture can be practiced on this land because the land is smooth and fit for cultivation to a great extent whereas the existing area of the Gram Panchayat is not fit for cultivation. Therefore, by this exchange of the areas, income of the Gram Panchayat can increase. As such, this resolution has been passed unanimously and copies of the resolution, jamabandi, mutation, Khasra girdawari, Ake Shajra, market value of the land of the applicant companies and the land of the Gram Panchayat have been sent to the Director of Panchayat, Haryana, Chandigarh, through the Block Development and Panchayat Officer, Gurgaon for the proposed exchange."

Vide orders dated 31st December, 1991/2nd January, 1992, the Government approved exchange of Shamlat land of Gram Panchayat, Wazirabad measuring 138 Bighas 15 Biswas with the land measuring 138 Bighas 15 Biswas owned by the appellants-companies with the following conditions :-

Deputy Commissioner, Gurgaon ensure that the land which is transferred to Gram Panchayat after exchange does not fall in the prohibited area of Air Force Radar (except in order to maintain contiguity as laid down in condition No. 1).

The principal of zone to zone transfer shall also not be disturbed meaning thereby that an area in a particular zone Residential, Commercial or Industrial, shall be exchanged with an equivalent in that very particular zone only. For example say if 10 Acres of Panchayat land falling in Residential Zone is being exchanged then the Panchayat should also get in exchange 10 Acres of colonizers land falling in Residential Zone and so on.

The D.C. should also ensure contiguity of the various portions of land coming to the Panchayat in exchange. He is authorised to change any Khasra Nos. or portion(s) thereof, if necessary for this purpose. Even the area within the prohibited zone may be exchanged with an equivalent area within the same zone, if necessary for this purpose. But the total area must not exceed with which is given in the resolution No. 1 dated 29.6.1991 of the Gram Panchayat.

The Companies/persons with whom the Gram Panchayat land is being exchanged shall give an undertaking that they will provide path/approach to the existing Mandir and other Panchayat/private lands to which approach lies within the land being given to them in exchange."

It appears from the perusal of the records that prior to when the approval of the Government came to be recorded, there were some complaints filed by the inhabitants of the village as also others opposing the proposed exchange sought for by the appellants. One such complaint was made by Gram Sewa and Sudhar Samiti dated 15th November, 1991 and it appears that objections raised in the aforesaid complaint were considered by the Government and for that precise reason while according approval to the resolution passed by the Gram Panchayat, conditions as reproduced above came to be imposed. Vide note dated 6th December, 1991, Commissioner Development and Panchayat mentioned that the matter had been discussed with the Development Minister, Commissioner/Secretary (Panchayat) and Director (Panchayat) and after discussions it was felt that although the Field Officers including the Deputy Commissioner had recommended its acceptance but the complaint dated 15th November, 1991 filed by the Gram Sewa and Sudhar Samiti, Wazirabad, Distt. Gurgaon has also to be kept in view. The five objections taken by the Samiti were detailed as follows :-

Panchayat''s resolution does not reflect the name of any company.

The company seeks exchange of land- Why?

Company''s land - its Khasra No. fall in which area.

In its resolution, the Panchayat has used the word "Companies" instead of "Company" whereas, in fact, this exchange is only with one Company.

Whether the Panchayat has taken up this step after consultation with and approval of Elders of the village."

In the summary of the note, aforesaid all these objections were commented upon and in ultimate analysis with a view to meet the objections of the Samiti aforesaid some condition precedents for grant of approval were suggested. It is clear from the records of the case that the same very conditions were imposed while giving approval to the exchange of land. It is in compliance of the condition aforesaid only that ultimately the total land that was to be exchanged between the parties was reduced to 75 Bighas 14 Biswas and with regard to this much of land only the exchange was effected and the possession changed accordingly. We also find from the records of the case that the concerned authorities as envisaged under 5 of 1964 s had determined the market value of the land located in the entire village on a flat rate depending upon its nature i.e. Chahi, Barani etc. and no effort at any stage was made to actually sec the market value subject matter of exchange between parties i.e. the appellants and the gram panchayat. As is normally done in land acquisition matters, the sale price of various kinds of land spanned over a period of 5-10 years was taken into consideration for determining the value of the land subject matter of exchange.

Having grasped the facts in sufficient details, time is now ripe to evaluate and determine the various points raised by Mr. Sarin in support of Letters Patent Appeal asking for setting aside the order passed by the learned single Judge. His first contention is that the learned single Judge had no jurisdiction to convert a Civil Revision emanating from the interim order passed by the Civil Court to treat the matter as Civil Writ Petition under Articles 226 of the Constitution of India and, in any case, if such a procedure was to be adopted being permissible under law, the writ under relevants and orders ought to have been placed before a Division Bench for admission and it is only thereafter that the matter could be dealt with by the learned single Judge. We have given our anxious thought to the contention raised by the learned counsel but we find, in the peculiar facts and circumstances of this case that the same has no substance. During the course of arguments, Mr. Sarin, learned counsel for the appellants had to admit that the cause of the plaintiffs being a public cause could be taken notice of by the learned single Judge and even a letter written by an ordinary citizen could be treated to be a public interest litigation by converting the same into writ petition. His objection, however, is to the procedure adopted by the learned single Judge in himself dealing with the matter before first getting it placed before the Division Bench for admission as envisaged under the High Court Rules and Orders. We might have considered this argument and taken it to its logical end by giving our opinion of the issue aforesaid one way or the other, but in view of the later development that similarly situated persons have filed two separate writ petitions which concededly were put before the Division Bench and in one such petition notice was issued to the appellants who have filed the reply and the controversy in Letters Patent Appeal and the writ petition is the same, we are not inclined to give any finding on the contention raised by the learned counsel as even if the contention of the learned counsel is to prevail, the writ petition involving identical points shall have to be decided and obviously there is no such objection raised in defence of the two writ petitions mentioned above. The first contention of the learned Counsel for the appellants is, thus, repelled.

The next contention raised in the matter is with regard to some observations made by the learned single Judge that the learned Counsel for the appellants styles the same in the realm of conjectures and surmises. It is being argued that the learned single Judge by the mere fact that appellants were sister companies of a well known concern i.e. D.L.F. had attributed motive of grabbing the prime land of the Gram Panchayat located in Commercial potential area where the price of the land were soaring high was unjustified. We do not wish to comment upon this argument of the learned Counsel for the appellants as well for the sole reason that the learned single Judge has not based his judgment on the motive of the appellants and rather chosen to decide the controversy on the basis of 5 of 1964 Rule and that too mainly pertaining to determination of the prices, a condition precedent for exchange of Gram Panchayat land. The learned Counsel then contends that the observations/findings of the learned single Judge that the appellants bad filed an application to the Gram Panchayat for exchange of its land on 28th of June 1991 and the resolution came to be passed on 29th June, 1991 i.e. just the next day, is not borne out from the records on the case and, in fact and reality far earlier to 28th of June, 1991, a request was made to the Gram Panchayat for exchange of land. In that context the resolution passed by the Gram Panchayat for exchange of land and the records culminating into exchange of land have been referred to. Resolution of Gram Panchayat annexed with Writ Petition bearing No. 16487 of 1995 recites that by an earlier resolution of Panchayat dated 22nd of May, 1991, the appellants companies had handed over the revenue record which was called for by the Gram Panchayat. The resolution Annexure P-1 also refers to copies of Jamabandi, mutation, khasra girdwari, Ake Sharjra, market value of the land of the appellant-companies and that of the Gram Panchayat having been sent to Director of Panchayat, Haryana, Chandigarh through Block Development and Panchayat Officer, Gurgaon for the proposed exchange. We have, even otherwise seen the records of the case and we are convinced that the appellants had not moved for exchange of land on 28th June, 1991 and it is not deliberations of one day only that led to the resolution being passed by the Gram Panchayat on 28th June, 1991. As mentioned above, the sanction to the exchange was granted by the Government on 31st December, 1991/2nd February, 1992 and before that on 25th September, 1991 spot inspection was carried out by the S.D.O., Gurgaon who vide his note made on 25th September, 1991, stated that spot inspection was made in connection with the exchange of Shamlat Deh land of Panchayat, Wazirabad along with Block and Panchayat Officer and Patwari of the Circle. It is therefore that the matter was discussed by the Development Minister with the Commissioner and Secretary, Panchayat and Director, Panchayat wherein it was decided to keep in view the complaint dated 15th November, 1991 filed by Gram Seva and Sudhar Samiti, Wazirabad, District Gurgaon with regard to the points already noticed above. The contention of Mr. Sarin to the extent that approval came to be recorded by the Government after matter was considered at all concerned levels and it was not a case where hurriedly the Gram panchayat had passed resolution and approval to which was granted by the Government is correct but that, in our view, does not etract from the judgment of the learned single Judge faulting the approval of the Government based upon 5 of 1964 Rules.

If the conditions precedent for approval of exchange were not complied with, as is the finding of learned Single Judge, the fact that the Gram Panchayat had passed the resolution in utmost haste or that before such a resolution came to be passed, the matter was properly discussed and some requisite steps of inspecting the site etc. were taken into consideration, would be of no consequence. We shall deal with 5 and the conditions precedent for exchange of Gram Panchayat land but before we do that, it will be appropriate to deal with other contentions that have been raised by Mr. M.L. Sarin, learned counsel representating the appellants. It is being strenuously argued that the plaintiffs instituted a suit after a considerable delay and meanwhile the appellant/defendants had already developed the land which came to it by virtue of exchange. It is stated that the appellants have already invested about 18 crores of rupees in development of the colony known as Qutab Enclave which includes the land received by the appellants in exchange. The appellants as also DLF Ltd. have already spent over Rs. 5 lacs on the construction of access roads for Wazirabad village and execution of other development works for the upliftment of the residents of village and it is only on November 10, 1992 i.e. nearly after one year of the grant of sanction by respondent No. 1 and six months after the issuance of licences in favour of the appellants, that the plaintiffs i.e. respondents 3 to 12 filed a suit in the Court of Addl. Senior Sub Judge, Gurgaon on the allegations that the said respondents were Harijans and landless persons of village Wazirabad and that they did not own any agricultural land for their cattle, cows, buffaloes, sheeps, goats etc. and that they used the land in dispute for grazing according to wazib-ul-arz. the appellants had, thus, alteced their position to their detriment in the interregnums for December 31, 1991 to March 3, 1994 on the basis of resolution passed by the Gram Panchayat and had spent so much of money for developing the exchanged land that an order setting aside the approval granted by the Government to exchange the land would put the appellants to such a financial burden that they will not be compensated and, therefore, the delay in instituting the suit should have been in itself enough to negate the plea of the plaintiffs, contends the learned counsel. The contention appears to be impressive but when scanned through with regard to relevant data, the same deserves to be rejected. The resolution was passed by the Gram Panchayat on June 29, 1991 and concededly, on that date, no right had vested with the appellants as mere passing of the resolution by the Gram Panchayat could not possibly clothe the appellants with any title of the exchanged land as prior approval of the Government is a condition precedent. There was no question for the appellants to, thus, have started dumping money with a view to develop the exchanged land before even the approval of the Government came to be recorded. Such an approval was given by the Government on December 31, 1991/ January 2, 1992 and mutations in respect of change of possession were sanctioned on March 27, 1992. The appellants obtained licences for setting up a colony on May 26, 1992 and the civil suit came to be instituted on November 17, 1992 i.e. within about six months from the date when the appellants obtained licence for setting up and development of a colony. It is admitted that the appellants had filed written statement on December 10, 1992 along with reply to the application under Order 39 Rules 1 and 2 C.P.C. They were directed to maintain status-quo vide orders dated February 16, 1993. There is no definite proof brought on records of the case that might reveal that the appellants had spent the amount as is sought to be made out before institution of the suit or before injunction was granted to the plaintiffs and against them to maintain status quo. This contention of the learned Counsel for the appellants is, thus, repelled.

The next contention of the learned Counsel appearing for the appellants is that the exchange in question was for the benefit of the Gram Panchayat and inhabitants of the village and the findings recorded contrary thereto by the learned single Judge deserves to be set aside. In the context of the contention noticed above, it is being argued that the land of the panchayat was scattered, the same was also in the shape of pits and drains and this has specifically been mentioned in the resolution passed by the Gram Panchayat. By the proposed exchange the area of panchayat was to be consolidated in one lot and then it could be either given on lease or trees could be grown there and in either event the Panchayat would have been and in fact a gainer. The paramount consideration as envisaged under 5 of 1964 Rule was benefit of the inhabitants of the village and, therefore, the resolution passed by the Panchayat and its approval accorded by the Government could not be faulted contends the learned Counsel. It is true that in the resolution passed by Gram Panchayat it has been mentioned that the land of Gram Panchayat comprises of Ghair Mumkin, Nullas and pits and this area falls in between the area of the companies and as a result of the exchange the area of panchayat shall become consolidated in one lot as also that the Gram Panchayat after the exchange of this area can give it on lease or can grow trees thereon but a perusal of AKs Shajra Plan of Wazirabad, Annexure A-1 attached with the Letters Patent Appeal would reveal that even after exchange even though the panchayat is getting an equal area but the same is once again scattered on five different places, if not more. Exchanged area from companies to Gram Panchayat has been depicted in red colour in plan Ex.A1 at page 36 of the paper book. It could not be successfully shown to the Court that the area which has come to the appellants in exchange was of no use to the panchayat and that nothing could be grown thereon. There may have been some drains or pits as is suggested by the appellants but that does not mean that the land was of no use to the Gram Panchayat. Assuming that there were lot of pits and drains in the land that was in the ownership of Gram Panchayat and has been given in exchange to the appellant, yet its potential of being converted into residential, commercial or industrial area could not be disputed. In fact, the appellants have obtained this land in exchange for the sole purpose of converting it into residential area. If nothing then atleast the Gram Panchayat could have been benefitted a great deal if it was to sell the land in shape of plots as the appellant-companies are doing and utilise the proceeds of sale for either purchasing land itself or for other common purposes, thus, benefiting the village community at large. The reasons, showing the benefit of Gram Panchayat as made out from the reading of the resolution alone do not, thus, appear to be correct to this Court. The Court would not like to close the chapter by returning a positive finding on this crucial issue as there may still be other reasons that the Gram Panchayat or the inhabitants of the village may be benefited because of the exchange but the reasons mentioned in the resolution showing benefit of inhabitants do not appear to be correct and Counsel appearing for the appellants could not support such reasons. The Court is commenting upon this aspect of the matter only with a view to find out merit in the contention of the learned counsel that the exchange as per reasons recorded in the resolution were for the benefits of inhabitants of the village. The order passed by the Government approving the exchange in question Annexure A-10 (page 107 of the paper book) concededly ascribes no reasons whatsoever for grant of the approval nor there is a word mentioned that the exchange shall be for the benefit of inhabitants of the village. That, however, may not be conclusive as it is always open to a contesting party to show that even though the reasons have not been mentioned in the order but the same can be culled out from the relevant records. In that case the concerned party has to show so. That apart, the approval of the Government was with regard to exchange of an area measuring 138 Bighas 15 Biswas whereas concededly the land that ultimately changed hands was far less. There was no fresh approval by the Government with regard to the land which ultimately exchanged hands between the parties. This contention of the learned counsel is, thus, repelled.

Coming now to the essential pre-requisites for exchange of Gram Panchayat land as envisaged under 5 of 1964 Rules, it shall be seen that the panchayat has to apply its mind and then come to the conclusion that if is for the benefit of the inhabitants of the village and prior approval of the Government has to be obtained. The third and equally important pre-requisite is that the land must be of equal value to be determined by the Tehsildar in which jurisdiction the land is situate. 5 of 1964 Rule reads as under :-

" Rule 5: Exchange of Land - A Panchayat if it is of opinion that it is necessary so to do for the benefit of the inhabitants of the village may with the prior approval of the Government, transfer any land in Shamlat deh by exchange with the land of an equivalent value to be determined by the Tehsildar in whose jurisdiction the land is situate."

The thrust of the is on equivalent value and not on equivalent area. In that context if the conditions as spelled out from order dated 31st of December, 1991/2nd of January, 1992 imposed by the Government are sent it will become apparent that the Government was labouring under misapprehension that it was perhaps an equivalent land which was to be the essential condition. The relevant part of condition No. 1 reads :-

"The principle of zone transfer shall not be disturbed, meaning thereby that an area in a particular zone Residential, Commercial or Industrial, shall be exchanged with an equivalent area in that very particular zone only."

As regards the valuation, there is the report of the Patwari dated 24th of July, 1991 which is countersigned by the Tehsildar. As mentioned earlier, average price of various kinds of land like Chahi, Barani has been taken on the basis of sales made during the period 1991. Mr. Sarin, however, informs the Court that an average price of various kinds of land spanned over 5-10 years was taken into consideration. It is conceded between the parties that such sale instances were from the whole village and no efforts at all were made to see the potential of the land and then work out the price of land of the Gram Panchayat as also the appellants. It is also conceded between the parties that the entire land i.e. either belonging to the Gram Panchayat or the appellants was evaluated at the same rate irrespective of its location i.e. whether it was located near the Radar where no construction can be made or in close vicinity of various structures, be it residential or commercial that have already come into existence, The way and manner in which the value of the land has been worked out, in considered view of the Court is wholly illegal. With a view to solve this tangle, the Court from time to time with the consent of the parties appointed Valuers chosen by the respective parties who have submitted their reports. It is true that the Valuers have filed the reports and by and large they all agree that the price of the land belonging to Gram Panchayat that has been given to the appellants in exchange is the same but the plaintiffs have filed objections to these reports which this Court is ill-equipped to go into. If perhaps, the consensus was to be arrived at between the parties with regard to the value of the land, other things could be looked into and sorted out by the Court but inasmuch as there could not be any consensus on the aforesaid crucial issue and circulations of the price done by the Tehsildar prior to sanction accorded by the Government for exchange being wholly unsatisfactory, there is no option for this Court but for to hold that the exchange was not in accordance which 5 of 1964 Rule and therefore, no fault can be found with the findings to that effect recorded by the learned Single Judge. No other point has been raised before this Court.

From the discussion made above, it is apparent that the order in question passed by the Government approving the resolution of the Gram Panchayat for exchange of its land was not passed after complying with the mandatory provisions of 5 of 1964 Rule and therefore the matter is remitted to the Government to reconsider approval or otherwise of the resolution passed by the Gram Panchayat strictly in compliance with 5 of 1964 Rules. While taking the matter in hand, the Government would hear the contesting parties. The Letters Patent Appeal is, thus, partly allowed giving liberty to the appellants to seek approval of the Government afresh in the manner fully indicated above. The result of the Letters Patent Appeal shall follow in Civil Writ Petitions Nos, 1991 of 1995 and 16487 of 1995. In the facts and circumstances of this case, there shall, however, be no order as to costs.