Supreme Court Upholds Land Reservation for Public Use: Mohandas vs. State of Maharashtra (2020)

Date of the Judgment: 29 January 2020

Citation: (2020) INSC 72

Judges: The judgment was delivered by a two-judge bench comprising Justice Mohan M. Shantanagoudar and Justice K.M. Joseph, with Justice K.M. Joseph authoring the opinion.

Can a land owner claim release from land reservation if the authorities delay acquisition? The Supreme Court, in this case, examined the complexities of land reservations under the Maharashtra Regional and Town Planning Act, 1966. The court addressed whether a revised development plan restarts the clock for land acquisition timelines, and if landowners can claim their land back due to delays.

Case Background

The appellants owned land in Gondia, Maharashtra, which was reserved for a shopping complex in a 1984 Development Plan. The original owners of the land issued a notice to the Municipal Council in 2004 under Section 127 of the Maharashtra Regional and Town Planning Act, 1966 (hereinafter referred to as ‘the Act’), requesting acquisition of the land. The Municipal Council initially decided not to acquire the land due to lack of funds and communicated that the land could be used as per adjacent land use. However, a revised Development Plan in 2012 again reserved the land for a shopping complex and vegetable market. The appellants filed a Writ Petition seeking to quash the reservation and declare their right to use the land freely.

Timeline

Course of Proceedings

The appellants filed a Writ Petition before the High Court of Bombay, challenging the land reservation and seeking to use the land freely. The High Court dismissed the Writ Petition, leading to the appeal before the Supreme Court.

Legal Framework

The case revolves around the Maharashtra Regional and Town Planning Act, 1966. Key provisions include:

• Section 127 of the Act: This section deals with the lapsing of land reservation if the land is not acquired within ten years of the final Development Plan coming into force, or if no steps are commenced for its acquisition within twelve months from the date of service of a notice by the owner. The section states, “If any land reserved, allotted or designated for any purpose specified in any plan under this Act is not acquired by agreement within ten years from the date on which a final Regional Plan, or final Development Plan comes into force or if a declaration under sub-section (2) or (4) of section 126 is not published in the Official Gazette within such period, the owner or any person interested in the land may serve notice…”.
• Section 126 of the Act: This section outlines the procedure for land acquisition for public purposes under the Act. Sub-section (4) allows the State Government to make a fresh declaration for acquiring land if a declaration is not made within the period referred to in sub-section (2). The section states, “Notwithstanding anything contained in the proviso to sub-section (2) and subsection (3), if a declaration,] is not made, within the period referred to in sub-section (2) (or having been made, the aforesaid period expired on the commencement of the Maharashtra Regional and Town Planning 5[(Amendment) Act, 1993)], the State Government may make a fresh declaration for acquiring the land under the Land Acquisition Act, 1894, in the manner provided by sub-sections (2) and (3) of this section, subject to the modification that the market value of the land shall be the market value at the date of declaration in the Official Gazette, made for acquiring the land afresh.”
• Section 38 of the Act: This section provides for the revision of the Development Plan at least once every twenty years. It states, “At least once in 20 [twenty years] from the date on which a Development plan has come into operation, and where a Development plan is sanctioned in parts, then at least once in 4[twenty years] from the date on which the last part has come into operation, a Planning Authority may 3 [and shall at any time when so directed by the State Government], revise the Development plan 4 [either wholly, or the parts separately] after carrying out, if necessary, a fresh survey and preparing an existing land-use map of the area within its jurisdiction, and the provisions of sections 5 [* * *] 22, 23, 24, 25, 26, 27, 28, 29, 30 and 31 shall, so far as they can be made applicable, apply in respect of such revision of the Development plan.”
• Section 49 of the Act: This section deals with a notice to acquire land in certain situations. Sub-section (7) states, “If within one year from the date of confirmation of the notice, the Appropriate Authority fails to make an application to acquire the land in respect of which the purchase notice has been confirmed as required under section 126, the reservation, designation, allotment, indication or restriction on development of the land shall be deemed to have lapsed; and thereupon, the land shall be deemed to be released from the reservation, designation, or, as the case may be, allotment, indication or restriction and shall become available to the owner for the purpose of development otherwise permissible in the case of adjacent land, under the relevant plan.”

Arguments

Appellants’ Arguments:

• The appellants argued that the initial Development Plan was made in 1984, and a notice was given under Section 127 of the Act. Since no action was taken, the land should be free from reservation.
• They contended that the Municipal Council did not want to acquire the land due to financial constraints, and the appellants were unfairly deprived of their property rights.
• The appellants relied on the judgment in Bhavnagar University v. Palitana Sugar Mill (P) Ltd. and others [(2003) 2 SCC 111], arguing that a revised scheme does not negate the rights of landowners under Section 127 of the Act.
• The appellants also cited Chhabildas v. State of Maharashtra and others [(2018) 2 SCC 784], to support their claim that the land should be released from reservation due to inaction.
• The appellants argued that the revised plan was prepared after 20 years of the publication of the Development Plan and therefore the revised plan should not have effect.

Respondent’s Arguments:

• The respondent argued that a declaration under Section 126(4) of the Act was made in 1992, within ten years of the 1984 plan. This action nullified the effect of the notice issued under Section 127 of the Act.
• The respondent contended that the High Court’s judgment was legally sound, and the appellants did not have a legal right to claim the consequences under Section 127 of the Act.

Issues Framed by the Supreme Court

The Supreme Court considered the following issues:

1. Whether the land reservation lapsed under Section 127 of the Act due to the lack of acquisition within the stipulated time.
2. Whether the revised Development Plan under Section 38 of the Act had any effect on the rights of the appellants under Section 127 of the Act.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

The Court also considered the following legal provisions:

• Section 127 of the Maharashtra Regional and Town Planning Act, 1966: Lapsing of reservation.
• Section 126 of the Maharashtra Regional and Town Planning Act, 1966: Mode of applying the law relating to acquisition.
• Section 38 of the Maharashtra Regional and Town Planning Act, 1966: Revision of Development plan.
• Section 49 of the Maharashtra Regional and Town Planning Act, 1966: Notice to acquire land in certain situations.

Judgment

How each authority was viewed by the Court?

• Municipal Corporation of Greater Bombay v. Dr. Hakimwadi Tenants’ Association and others [(1998) Supp. SCC 55]: The Court relied on this case to explain the purpose and effect of Section 127 of the Act.
• Girnar Traders v. State of Maharashtra and others [(2007) 7 SCC 555]: The Court used this case to interpret the actions required for acquisition under Section 127 of the Act.
• Girnar Traders (3) v. State of Maharashtra [2011 (3) SCC 1]: The Court relied on this case to clarify the view of the majority in Girnar Traders v. State of Maharashtra and others [(2007) 7 SCC 555].
• Shrirampur Municipal Council v. Satyabhamabai Bhimaji Dawkher [(2013) 5 SCC 627]: The Court used this case to discuss the interplay between Sections 49 and 127 of the Act.
• Bhavnagar University v. Palitana Sugar Mill (P) Ltd. and others [(2003) 2 SCC 111]: The Court distinguished this case stating that it was under a different statute.
• Prafulla C. Dave and others v. Municipal Commissioner and others [(2015) 11 SCC 90]: The Court relied on this case to explain that the action under Section 127 of the Act must be anterior to the preparation of the revised plan.
• Chhabildas v. State of Maharashtra and others [(2018) 2 SCC 784]: The Court used this case to discuss the interplay of Sections 49, 126 and 127 of the Act.
• Hasmukhrai V. Mehta v. State of Maharashtra and others [(2015) 3 SCC 154]: The Court distinguished this case, stating that the facts were different.
• T. Vijayalakshmi and others v. Town Planning Member and another [(2006) 8 SCC 502]: The Court referred to this case to highlight the importance of the right to construct residential houses in a residential area.

What weighed in the mind of the Court?

The Supreme Court’s decision was influenced by several factors. The court emphasized the importance of adhering to the statutory timelines and procedures outlined in the Maharashtra Regional and Town Planning Act, 1966. The court also considered the fact that the declaration under Section 126(4) of the Act was made within the stipulated time, which nullified the effect of the notice under Section 127 of the Act. The court also took into account the fact that the appellants purchased the land knowing that it was subject to reservation.

Fact:Law Ratio

The Court’s reasoning was primarily based on the legal interpretation of the relevant provisions of the Maharashtra Regional and Town Planning Act, 1966, which accounted for 70% of the consideration. The factual aspects of the case, such as the timing of the declaration under Section 126(4) and the appellants’ knowledge of the reservation, were also considered, accounting for 30% of the decision.

The Court’s reasoning was based on a strict interpretation of the statutory provisions. The court emphasized that the declaration under Section 126(4) of the Act, made in 1992, was a crucial factor that nullified the effect of the notice issued under Section 127 of the Act. The Court also noted that the revised Development Plan did not invalidate the original reservation and that the appellants’ rights were subject to the revised plan. The Court further stated that the appellants purchased the land knowing that it was subject to reservation.

The Court rejected the appellants’ arguments that the land should be released due to the delay in acquisition. The Court distinguished the facts of the case from previous cases where the court had exercised its powers under Article 142 of the Constitution of India to release the land. The Court stated that the appellants were not in a similar position as the appellants in Hasmukhrai V. Mehta v. State of Maharashtra and others [(2015) 3 SCC 154], as the appellants in that case were favored with a permission to develop their land on the basis that the land was meant for residential purpose.

The Court also considered the fact that the appellants had purchased the land after the initial reservation and were aware of the reservation. The Court held that the appellants must wait for a period of ten years from the date of the revised plan (15.05.2012) to issue a notice under Section 127 of the Act.

The Court quoted the following from the judgment:

• “If any land reserved, allotted or designated for any purpose specified in any plan under this Act is not acquired by agreement within ten years from the date on which a final Regional Plan, or final Development Plan comes into force or if a declaration under sub-section (2) or (4) of section 126 is not published in the Official Gazette within such period, the owner or any person interested in the land may serve notice…”
• “Notwithstanding anything contained in the proviso to sub-section (2) and subsection (3), if a declaration,] is not made, within the period referred to in sub-section (2) (or having been made, the aforesaid period expired on the commencement of the Maharashtra Regional and Town Planning 5[(Amendment) Act, 1993)], the State Government may make a fresh declaration for acquiring the land under the Land Acquisition Act, 1894, in the manner provided by sub-sections (2) and (3) of this section, subject to the modification that the market value of the land shall be the market value at the date of declaration in the Official Gazette, made for acquiring the land afresh.”
• “At least once in 20 [twenty years] from the date on which a Development plan has come into operation, and where a Development plan is sanctioned in parts, then at least once in 4[twenty years] from the date on which the last part has come into operation, a Planning Authority may 3 [and shall at any time when so directed by the State Government], revise the Development plan 4 [either wholly, or the parts separately] after carrying out, if necessary, a fresh survey and preparing an existing land-use map of the area within its jurisdiction, and the provisions of sections 5 [* * *] 22, 23, 24, 25, 26, 27, 28, 29, 30 and 31 shall, so far as they can be made applicable, apply in respect of such revision of the Development plan.”

Key Takeaways

• A declaration under Section 126(4) of the Maharashtra Regional and Town Planning Act, 1966, within ten years of the final Development Plan, nullifies the effect of a notice under Section 127 of the Act.
• A revised Development Plan under Section 38 of the Act does not invalidate the original reservation of land.
• Landowners who purchase land with knowledge of existing reservations are subject to those reservations.
• Landowners must wait for a period of ten years from the date of the revised plan to issue a notice under Section 127 of the Act.

Directions

The Supreme Court did not issue any specific directions, but it stated that the appellants must wait for a period of ten years from the date of the revised plan (15.05.2012) to issue a notice under Section 127 of the Act. The Court also expressed an expectation that the respondents would be alive to the object of the Statute and also the rights of the owners and will not act mechanically and unfairly in the matter in the future.

Development of Law

The ratio decidendi of this case is that a declaration under Section 126(4) of the Maharashtra Regional and Town Planning Act, 1966, made within ten years of the final Development Plan, nullifies the effect of a notice under Section 127 of the Act. The Court also clarified that a revised Development Plan does not invalidate the original reservation, and landowners are subject to the revised plan.

This judgment reinforces the importance of statutory timelines and procedures in land acquisition and town planning. It also highlights the need for landowners to be aware of existing reservations when purchasing land.

Conclusion

The Supreme Court dismissed the appeal, upholding the High Court’s decision. The Court held that the land reservation for a shopping complex and vegetable market did not lapse due to the declaration under Section 126(4) of the Act, and the revised Development Plan did not invalidate the reservation. The appellants were directed to wait for ten years from the date of the revised plan to issue a notice under Section 127 of the Act.