TMI Blog2000 (9) TMI 1083X X X X Extracts X X X X X X X X Extracts X X X X ..... ed for restraining the respondents from using or utilising any part or portion of land in question for any slaughter house/abattoir and restraining the respondent No. 4 from allowing respondent No. 5 to establish or operate any slaughter house abattoir on the land in question. Vide order dated 25-5-1988, the learned Single Judge of the High Court dismissed the writ petition and the appeal filed against the order of the learned Single Judge was dismissed by the Division Bench of the Calcutta High Court vide the judgment impugned in this appeal. 3. The facts leading to the filing of the present appeal are that by notification dated 22nd August, 1961 issued under the Land Acquisition Act, the Government of West Bengal acquired land measuring 151.18 acres for a public purpose, namely, construction of Mourigram-Dankuni Link Project of South-Eastern Railways. After completion of the project, the Railways surrendered the surplus land measuring 77.36 acres to the State Government on 7-7-1972. On 12-5-1973, the State Government handed over the possession of 74.21 acres of the surplus land to Animal Husbandry Veterinary Services, now Animal Resources Development Department. The West Ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... blishing abattoir at Mourigram, Newspaper advertisements appears to have been issued by the West Bengal Livestock Processing Development Corporation in 1986, inviting private parties to take over the Durgapur Abattoir which is shown to be running in losses and for which the Comptroller Auditor General had severely criticised the aforesaid Corporation vide its Report submitted in 1993. Respondent No. 5 is stated to have been invited by the State Government vide letter dated 19th October, 1993 for taking over Durgapur Abattoir. In reply Enagro Foods (India) Limited, a sister concern of respondent No. 5 intimated that we are willing to take over the existing facilities at Durgapur on as is where is basis' at reasonable terms for subsequent development into an export oriented integrated complex . On 22nd December, 1993 they informed the Minister concerned that to effectively utilise the State's agro based materials being livestock, fruits and vegetables, fresh water and sea fish in addition to milk based product, the concern proposed to create integrated food processing and preservation facilities. For that purpose, they promised that factory would be complete in accordance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A decision was taken on 18-4-1994 for transferring the land to the respondent No. 5 on long term basis, initially for a period of 99 years on payment of ₹ 71,59,820.80. On 13th June, 1994, respondent No. 5 was informed that possession of the land would be handed over after payment of the lease premium. Respondent No. 5 is stated to have made the payment of ₹ 87,27,000/- for the purchase of building, plant and machinery of Durgapur Slaughter House and on 13th July, 1994 and sum of ₹ 71,59,820/- as lease premium for Mourigram Abattoir. The lease deed was executed between the parties on 9th June, 1995 on terms and conditions which were incorporated in Part II of the Schedule attached to the said lease deed. 6. Feeling aggrieved, the appellants are stated to have filed the writ petition on 13-4-1998 without impleading respondent No. 5 as party thereto. Respondent No. 5 is shown to have been impleaded as party in the writ petition on 17th August, 1998. The writ petition was dismissed on 25th September, 1998 and appeal filed against it met the same fate on 10-5-1999, vide the judgment impugned in this appeal. 7. Dr. Abhishek Singhvi, learned Senior Counsel appear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re it, the High Court was justified in dismissing the writ petition filed by the appellants. The proposed setting up of the industry is stated to have provided job opportunities to more than 300 people and is likely to earn foreign exchange to the extent of ₹ 50 crores per year. It is argued that there is no defect or error or law in the decision making process of the State Government by which the land has been leased out to respondent No. 5. It is conceded that though the documents executed between the parties is styled as a lease deed, yet in fact it is a sale as the whole of the then prevalent market value of the land has been paid by the respondent No. 5. The lease deed is stated to have been got executed for keeping interests of the State alive in the land which in no way affects the public interest but in effect is adverse to the interests of the respondent No. 5. The deed is stated to have been concluded on the basis of negotiations, a recognised method of transferring the State property. 9, The learned Single Judge formulated the three questions for his adjudication which read as under: (a) Whether the writ petitioner nos. 3 to 6 can as a matter of right get bac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the submissions of the appellants to the effect that the land should have been sold by public auction, if after acquisition it was not used for any other public purpose by the Government. The Division Bench held that the surplus land in question need not have been sold in auction when the State had declared to utilise the land by leasing out the same for 99 years in favour of Respondent No. 5. Agreeing with the learned Single Judge, it was held by the Division Bench in appeal, that: We are, however, of the opinion that this Court is not at all required to be satisfied whether a surplus land has been utilised for a public purpose. After acquisition of the land in accordance with the procedure established by law a surplus land has vested in the State free from all encumbrances. Article 298 empowers the State to carry on any trade or business and make contracts for any purpose. 12. Finding that no allegations of malafide and discrimination had been pleaded in the petition, the State Government was held competent to enter into contracts with private persons for disposal of the property irrespective of the purpose of such acquisition or disposition subject only to the condition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in corresponding loss to the State exchequer, it reflected the legal malafides and the arbitrary action of the respondents. The argument has to be noted to be rejected inasmuch as nowhere in their writ petition the appellants had alleged that the land had been sold at a throw away price. 14. Referring to the lease argument it is contended that as in fact transaction is sale under the clock of lease, the legal malafides are writ large exhibiting the arbitration action of the respondents. Learned counsel appearing for the respondents have brought to our notice that in fact the value charged from respondents No. 5 was the market value of the land and not lease money as urged. In this regard, in the counter affidavit filed on behalf of the respondent No. 1 in this Court it is stated: In order that the proper and correct lease premium and lease rent were arrived at a valuation of the land in question was caused to be made by the Special Land Acquisition Officer. By the memo No. 49(c) dated 12th January, 1994 of the District Magistrate, Howrah, a copy whereof is annexed hereto and marked Annexure R1/8 , the valuation Report (in L.V. Case No. 46/93) was forwarded to the Secretary, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by Shedden Meeting Group, Australia in its feasibility study report carried out in the year 1983 as aforesaid) and indirect employment to large number of persons in West Bengal were taken into consideration. It was also taken into consideration that setting up an industry in such a semi-rural area in Mourigram, a Gram Panchayat area under Duillya Gram Panchayat of Zilla Parishad Howrah would help in industrialisation of the said area and consequently the State of West Bengal. The fact what the proposed unit would be an export oriented which would earn valuable foreign exchange of more than ₹ 50 crores under export obligation in terms of the EPGC Scheme of the Government of India where-under machinery and equipment for setting up the Project would be imported, as represented by the respondent No. 5 during the course of negotiation, was also taken into account. 16. Learned counsel for the appellant has not referred to any statutory provision mandating the State to adhere to a specified procedure in the matter of transfer of its property either by way of sale or by lease. In the absence of a statutory restriction imposed upon the State, it is to be seen whether the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of time and development of the area, the value of the land had appreciated manifold. It may be noticed that in the year 1961 the erstwhile owners were paid about ₹ 5.5 lakhs and the State Government assessed the market value of the property which was paid by respondent No. 5 at ₹ 71,59,820/- The appellants have themselves stated that the value of the land round about the time, when it was leased to respondent No. 5 was about ₹ 11 crores. There cannot be any dispute with the proposition that generally when any State land is intended to be transferred or the State largesse decided to be conferred, resort should be had to public auction or transfer by way of inviting tenders from the people. That would be a sure method of guaranteeing the compliance of mandate of Article 14 of the Constitution. Non-floating of tenders or not holding of public auction would not in all cases be deemed to be the result of the exercise of the executive power in an arbitrary manner. Making an exception to the general rule could be justified by the State executive, if challenged in appropriated proceedings. The Constitutional Courts cannot be expected to presume the alleged irregulariti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [1980]3SCR1338 , this Court, after referring to various judgments, including the judgment in Ramana Dayaram Shetty 's case, held: It is imperative in a democracy governed by the rule of law that governmental action must be kept within the limits of law and if there is any transgression, the Court must be ready to condemn it. It is a matter of historical experience that there is a tendency in every government to assume more and more powers and since it is not an uncommon phenomenon in some countries that the legislative check is getting diluted, it is left to the Court as the only other reviewing authority under the Constitution to be increasingly vigilant to ensure observance with the rule of law and in this task, the court must not flinch or falter. It may be pointed out that this ground of invalidity, namely, that the governmental action is unreasonable or lacking in the quality of public interest, is different from that of mala fides though it may, in a given case, furnish evidence of mala fides. 21. In M. P. Oil Extraction A nr. State of M.P. Ors (1997)7SCC592 this Court held: Although to ensure fair play and transparency in State action, distribution of largess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dvertisements. 24. The Government had decided to make a package deal for the purposes of transferring the Durgapur Project and establishment to Mourigram Project. Earlier a memorandum of understanding had been arrived at between Government of India and Australia which ultimately did not nature in the shape of an abattoir. Due to financial constraints continuous loss suffered at Durgapur and lack of technical expertise, the respondent-State could not venture to undertake the Mourigram Project for setting up of an abattoir. Having failed in all its efforts, the then Minister-in-charge of the Animal Husbandry and Veterinary Services Department of the Government of West Bengal is stated to have written to some Bombay based firms, reputed in the field, to salvage the two projects. Positive response is stated to have been received from some firms including Genagro Foods (India) Limited, namely, respondent No. 5 and M/s. I Ahmed Company. The proposal of I. Ahmed Company being very vague was not accepted. Respondent No. 5 had shown interest in taking over both Durgapur Mourigram sites under certain terms and conditions for the purpose of revitalising and making operational the exi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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