ASSOCIATION OF VASANTH APARTMENTS’ OWNERS VERSUS V. GOPINATH & ORS

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE/ORIGINAL JURISDICTION

CIVIL APPEAL No. 1890-91 of 2010

ASSOCIATION OF VASANTH APARTMENTS’

OWNERS …APPELLANT(S)

VERSUS

V. GOPINATH & ORS. …RESPONDENT(S)

WITH

CIVIL APPEAL NO. 7334 OF 2013

CIVIL APPEAL NO. 7847-7848 OF 2013

WRIT PETITION (CIVIL) No.591 of 2015

J U D G M E N T

K.M. JOSEPH, J.

1. Civil Appeal Nos. 1890-91 of 2010 is connected with

the other cases. We are disposing of the Appeals and

the Writ Petition filed under Article 32, having

generated certain common issues by the following common

Judgment.

INDEX

ABOUT THE CASES AND THE PARTIES........................................................ 3

The case of Association of Vasanth Apartments Owners......................... 3

The case of Keyaram Hotels Pvt. Ltd........................................................ 8

CREDAI; Writ Petition No. 591/15 under Article 32.................................. 19

SUBMISSIONS OF APPELLANTS/PETITIONER............................................ 22

SUBMISSIONS OF SHRI N. SUBRAMANIYAN, ADVOCATE IN C.A. 7334 OF

2013 [KEYARAM HOTELS P. LIMITED] ....................................................... 25

SUBMISSIONS OF MS. V. MOHANA, SENIOR ADVOCATE ON BEHALF OF

THE WRIT PETITOINER IN WRIT PETITION (CIVIL) NO. 591 OF 2015........ 29

SUBMISSIONS OF SHRI AMIT ANAND TIWARI; ADDITIONAL A.G. ON

BEHALF OF STATE OF TAMIL NADU AND ‘CMDA’. ..................................... 35

SUBMISSIONS MADE BY SRI JAYANTH MUTHRAJ, SENIOR ADVOCATE

RESPONDENTS NOS. 1 AND 2 IN C.A. NO. 1890 OF 2010. ......................... 44

SUBMISSIONS BY SHRI K.S. SURESH, ADVOCATE IN CIVIL APPEAL

NO.7848 OF 2013 ........................................................................................ 46

ANALYSIS ................................................................................................... 47

THE GIFT DEED IN VASANTH APARTMENTS CASE ................................... 82

WHETHER THE IMPUGNED RULE VIOLATES ARTICLE 14 OF THE

CONSTITUTION? IS IT DISCRIMINATORY? ................................................ 86

IS THE IMPUGNED RULE/ REGULATION ULTRA VIRES?............................ 91

THE IMPACT OF SECTIONS 36 AND 37 ...................................................... 95

IS THE IMPUGNED RULE/REGULATION BAD FOR THE REASON THAT IT IS

CONTRARY TO THE MANDATE OF SECTION 39 OF THE ACT? ................ 100

THE IMPACT OF SECTIONS 48 TO 55....................................................... 108

THE RIGHTS REGIME................................................................................ 114

DOWN MEMORY LANE .............................................................................. 134

PT. CHET RAM VASHIST (DEAD) BY LRS. V. MUNICIPAL CORPORATION

OF DELHI................................................................................................ 134

T. VIJAYALAKSHMI AND OTHERS V. TOWN PLANNING MEMBER AND

ANOTHER............................................................................................... 137

PUNE MUNICIPAL CORPORATION AND ANOTHER V. PROMOTERS AND

BUILDERS ASSOCIATION AND ANOTHER ............................................. 138

TUKARAM KANA JOSHI AND OTHERS V. MAHARASHTRA INDUSTRIAL

DEVELOPMENT CORPORATION AND OTHERS ...................................... 140

JILUBHAI NANBHAI KHACHAR AND OTHERS V. STATE OF GUJARAT

AND ANOTHER....................................................................................... 142

STATE OF GUJARAT V. SHANTILAL MANGALDAS AND OTHERS ......... 142

NARAYANRAO JAGOBAJI GOWANDE PUBLIC TRUST V. STATE OF

MAHARASHTRA AND OTHERS............................................................... 148

YOGENDRA PAL AND OTHERS V. MUNICIPALITY, BATHINDA AND

ANOTHER............................................................................................... 151

VIRENDER GAUR AND OTHERS V. STATE OF HARYANA AND OTHERS 154

A BRIEF LOOK AT THE FIFTH AMENDMENT CASES IN THE UNITED

STATES ..................................................................................................... 176

ENTRY 42 OF LIST III OF THE SEVENTH SCHEDULE............................... 191

THE UPSHOT OF THE ABOVE DISCUSSION ............................................. 242

ABOUT THE CASES AND THE PARTIES

The case of Association of Vasanth Apartments

Owners

2. Civil Appeal Nos. 1890-91 of 2010 is directed

against the judgment dated 19.10.2007 rendered by a

division bench of the High Court. Writ Appeal No. 478

of 2007 and Writ Appeal No. 1026 of 2007 were appeals

generated by the judgment which was rendered by the

learned Single Judge, in Writ Petition No. 4766 of 2007

dated 20.02.2007. By the same the learned Single Judge

allowed the writ petition filed by the writ petitioners

who are the appellants before us. It was interalia

their case that they were owners of certain apartments

situated in a complex which consisted of 12 blocks. The

total area of the layout was more than 10,000 sq.

metres. A portion of the land was earmarked in terms

of Rule 19 of the Development Control Rules

(hereinafter referred to as ‘DCR’) as Open Space

Regulation area (hereinafter referred to as ‘OSR’). A

gift deed was executed in favour of the Chennai

Metropolitan Development Authority on 18.02.1994.

However, despite the lapse of 12 years of the gift, the

OSR area had not been developed into a park. The learned

Single Judge disposed of the writ petition by directing

the appellant association to maintain the open space

area as a park with recreational facilities in

accordance with the ‘DCR’. It was also made clear that

it is always open to the respondents to take action in

accordance with law if there is any violation. It was

found to be the duty of the respondents to maintain

such open areas as parks and on there being a failure

on their part, the association of the residents should

be welcomed to do the same subject to the rules. Writ

Appeal no. 478 of 2007 was filed by one Shri Gopinath

and others. They were persons who were living in the

neighbourhood. Writ Appeal no. 1026 of 2007 was filed

by the Commissioner of the Corporation of Chennai and

the Member Secretary of the Chennai Metropolitan

Development Authority (hereinafter referred to as the

‘CMDA’). It was by the judgment impugned in Civil

Appeal Nos. 1890-91 of 2010, the division bench allowed

the Writ Appeals and set aside the judgment of the

learned Single Judge. We notice the following findings

and relief granted: -

“17. When the land has been assigned in the

year 1994 in favour of the CMDA by way of the

Gift Deed, neither the CMDA nor the Corporation

of Chennai have taken any step to make use of

the land for the interest of public. It is

clear from the report filed by the AdvocateCommissioner and the photographs filed before

us and the other materials available on record

that in the OSR area, there is a katcha road,

which is said to have been laid by the

Corporation in the year 2003. Probably because

of this katcha road and the usage of the same

as road by all the residents in the locality,

the occupants of the Vasanth Apartments might

have felt disturbance, which would have

prompted them to make a representation to the

Corporation to develop a park in the said area

or in the alternative to permit them to develop

and maintain a park for their recreational

purpose besides illegally constructing a

compound wall, separating the petrol bunk and

the compound wall for about a length of 30 feet

separating the unbridged 11 feet wide open

canal upto ground level, so as to close the

way once and for all. At this juncture, it is

to be pointed out that the Vasanth Apartments

is divided by a compound wall from this area

and it is It also not made clear by the Vasanth

Apartments Owners Association that the said

land, which was gifted to the CMDA, is part of

their lay out.”

“18. It has also been alleged that under

similar circumstances, the CMDA has permitted

all the residents associations in Velachery to

maintain the open spaces as recreational parks

in the nearby area viz. K.G.Apartments, Sai

Sarovar etc. Each case has to be viewed and

decided on its own merits and since in the case

on hand, in the interest of thousands of

general public residing in and around the area,

the authorities have taken a wise decision to

lay a road to have easy and immediate access

to the 100 ft. road, the same cannot be found

fault with.”

“19. Further more, it has been brought to our

notice that with a view to form connecting road

to 100 feet bye-pass road, the Chennai

Corporation has already addressed the

Commissioner, Hindu Religious and Charitable

Endowments Department to transfer and convey

the land belonging to Arulmigu Dhandeeswarar

Temple, Velachery, Chennai in favour of the

Corporation and also obtained the said land to

form the connecting road from Hindu Religious

and Charitable Endowments Department.”

“20. Thus, though belatedly, now the CMDA and

the Corporation of Chennai are taking all

efforts to lay a pucca road in the OSR area

for the convenience of nearly one lakh people

in the area including the residents of Vasanth

Apartments. In this city, ill-famous for its

bumper to bumper traffic and the related

hazards faced by the road users day in and day

out, any such step taken by the civic

authorities to ease such bottleneck traffic

congestions should be appreciated and welcomed

without allowing anybody to put spokes in the

wheel of development, as /3 has been attempted

on the part of the Association of Vasanth

Apartments Owners in the case on hand.

For all the above reasons, since it has

been found that the writ petitioner has no

right or interest, whatsoever, in the OSR land,

and the prayer in the writ petition itself is

misconceived, both these writ appeals are

allowed, thus setting aside the order passed

by the learned single Judge. No costs.

Consequently, M.P.No.2 of 2007 in W.A.No.1026

of 2007 is closed.”

3. C.A. No. 7847-48 of 2013 arising out of SLP (C)No.

25709-25710 of 2011 is again filed by the Association

of Vasanth Apartments’ Owners i.e., the appellants in

C.A. No. 1890-91 of 2010. This is a separate litigation

though having a bearing on the issue. In this appeal,

Writ Petition No. 23397 of 2007 came to be filed by the

appellant Association challenging the vires of Rule 19

of the ‘DCR’ under which a gift had to be executed in

respect of the land comprised in 10% as we shall see

in greater detail. The Writ Petition, came to be

dismissed by the division bench by its judgment dated

06.03.2008 and it upheld the validity of the rule. C.A.

No. 7847 of 2013 is filed against the same. A review

filed turned unsuccessful. The order in the review has

led to the appeal, C.A. No. 7848 of 2013.

The case of Keyaram Hotels Pvt. Ltd.

4. Writ Petition no. 11934 of 1995 brings in the next

appeal which is C.A. No. 7334 of 2013. The above writ

petition was filed by M/s. Keyaram Hotel Pvt. Ltd. The

challenge in the said writ petition was to the very

same rule.

5. The case set up in short is as follows. The

petitioners are the owners of about 62 grounds. It

applied for the sanction of a building plan in the year

1975 for the construction of a hotel. There is

reference to an earlier writ petition and contempt

proceeding. Suffice it to notice, that planning

permission was granted after a delay of 12 years on

08.09.1992. It is their case that it was faced with

certain difficulties in the construction. A revised

plan was submitted and building permission was sought

for on 17.08.1994 for the construction of a hotel and

hotel annexe building etc. which consisted of a

basement, ground floor and three further floors. By

letter dated 13.09.1994 issued by the second respondent

the petitioner was to gift the open space reserved area

to the Commissioner Corporation of Madras. We may

notice further that the third respondent sent

communication on 01.12.1994. It is stated inter alia

that the structure which existed within the OSR area

should be demolished after due sanction and that the

OSR land should be free from any structure and be fenced

by providing separate entrance from the road side.

There is no mention about the gift deed. The petitioner

sought a month’s time to comply with the conditions in

letter dated 01.12.1994. However, the respondent

insisted on compliance with the requirement of

executing a gift deed. In the writ petition, an interim

Order dated 13.03.1996 was passed directing permission

after recording undertaking by petitioner to execute

gift deed without prejudice to the rights of the

petitioner. Petitioner executed gift deed on

22.05.1996. Petitioner’s revised plan was approved as

a group development on 24.04.1999. The grounds urged

against the rule appear to be as follows:

1.The rule is an illegal infraction of the

petitioner’s right to hold and enjoy the property.

2.The rule is contrary to the Act and derogatory to

the interest of the land owners.

3.The stipulation is violative of the civil right

vested in every owner of the property to hold his

land and the right to safeguard public interest

cannot be stretched to create a right and title in

favour of a local body in the manner contemplated

by the respondents 1 and 2. It could only impose

a condition to keep such land as open for being

used by the user of such building for their

communal or recreational purpose.

4.The provision for open space with respect to a

special building is for the communal and

recreational purposes of the people who shared

their accommodation in the said building or

otherwise lawfully use the same. It is not intended

to take away the proprietary right of the owners.

The expression of willingness by the petitioner to

provide the stipulated open space reserved for

communal and recreational use of the occupiers will

satisfy the public interest and object of the

legislation. Petitioners undertake to keep 10% of

the area to be developed excluding roads as open

space for communal and recreational purpose.

5.The further condition imposed by the 3rd respondent

to provide exclusive frontage for the said open

space area opening into the main road is

unconscionable in law and contrary to the spirit

of the Act. Such stipulation is in terrorum.

The relief sought is to declare Rule 19(b)(I)(v) of the

DCR void. That apart sanction is sought without

insisting on the rule.

6. We may notice the relevant contents of the counter

affidavit filed by the respondent State. The case set

up inter alia is that the CMDA had carried out necessary

survey and prepared the master plan which lays down

policies and programmes which are necessary to regulate

the growth of the area and also to ensure its economic

viability, social stability and sound management for

the present and the foreseeable future and orderly

development required the same. The DCR was an integral

part of the master plan. Any person wanting to develop

a property within the Metropolitan area must apply for

permission and the CMDA is empowered to enforce such

conditions and restrictions as was necessary under the

rules. It is in public interest. If the ownership of

the open OSR area were to be allowed to vest with the

original land owner, then the concerned owner would

have a chance to convert the same for construction, the

area specially reserved as open space, for communal

recreation by suppressing the said fact after passage

of time. Hence, it is necessary that the open space

area should be vested with the civil authorities who

are responsible for maintenance of parks and play

fields in the sites. The open space reservation is

provided to create lung space in the city and to have

sufficient open space for the use of society.

7. A counter affidavit was filed by the Chief Planner

of the CMDA and the stand taken was to seek support

under Section 17 of the Act read with Section 49. The

impugned Rule has been also referred to. As regards the

facts, it is stated as follows: -

“Para 5. petitioner submitted the application

on 17 .08.1994 for planning Permission for the

proposed construction of Hotel Complex

consisting of group of two massive blocks of

Basement plus ground plus three floors building

and four small buildings at D.No.l & 2,

Harrington road, Chetput, Madras - 31 in

R.S.No.355 of Nungambakkam Village. The total

floor area of the Hotel Buildings is about

13,300 M2. The extent of the site is about

10692 M2. In the plan submitted by the

petitioner there are certain existing

structures also, which are to be demolished for

the construction of the proposed hotel

buildings consisting of basement plus ground

plus three floors, after demolishing the

existing structures. In the plan submitted by

the petitioner he has also shown the area to

be reserved and handed over as open space

reservation. As the proposal of the petitioner

consists of group of two blocks of basement

plus ground plus three floors buildings in a

site of an extent of more than 10,000 M2, the

same was examined by this respondent under

Development Control Rules 19 (b) (II) (1) to

(V) and (VI) - C related to group development.

While the Development Control rule l9(b)(II)

(1) to (v) deals with the open spaces to be

left around the buildings, distance to be

maintained between the buildings etc, the rule

l9(b)(II) (VI-C) prescribes as following:

"C) SITE EXTENT above 10,000 m2

10 percent of the area excluding roads

shall be reserved and this space shall be

transferred to the authority or to the

local body designated by it, free of cost,

through a deed. It is obligatory to reserve

the 10 percent of the site area and no

charges can be accepted in lieu, m case of

new developments or redevelopments "

The second respondent examined the planning

permission application of the petitioner and

having satisfied with the plans with reference

to the Development Control Rules and in View

of the fact that the petitioner already

earmarked 1070 m2 being the 10 % open Space

Reservation area in the plan, sent a letter in

No.82/17789/94, dated 13.09.1194 stipulating

certain conditions and requesting, the

petitioner to,

i) pay the following charges

a) Development charges: Rs. 82,000/-

b) Security Deposit

for the building: Rs. 8, 00, 000/-

ii) hand over the 10% Open Space Reservation

Area reserved and shown in the plan to the

third respondent through a registered gift

deed.

The petitioner has not paid the security

Deposit, but however obtained a direction from

this Hon'ble Court to accept the Bank Guarantee

towards the security Deposit and furnished the

same to the second respondent along with his

consent letter dated 28.02.1995 accepting the

conditions stipulated in letter No. 82/ 17789

/94, dated 13.09.1994. In the said letter dated

13.09.1994 of the second respondent, one of the

condition is that the petitioner should hand

over the 10% Open Space Reservation Area to the

Commissioner, Corporation of Madras, free of

cost, through a· registered gift deed, which

is a lawful condition under Development Control

Rule 19 (b)(II) (VI - C). It is respectfully

denied that the petitioner has not made any

representation to relax the condition of

gifting of the Open Space Reservation Area and

the same was never under the consideration of

the second respondent.”

“Para 7. It is submitted that the second

respondent has requested the petitioner to

transfer the 10% Open Space Reservation Area

free of cost, through a registered gift deed

in favour of the third respondent as per the

provisions of Development Control Rules 19 (b)

(II) (VI - C), under group development

regulations and not as contended by the

petitioner under rule 19 (b) (I) (V), which

related to special Buildings. The Development

Control Rule 19 (b) (II) (VI - C) is as follows:

"C) SITE EXTENT above 10,000 m2

10 percent. of the area excluding roads

shall be reserved and this space shall be

transferred to the authority or to the

local body designated by it, free of cost,

through a deed. It is obligatory to reserve

the 10 percent of the site area and no

charges can be accepted in lieu, in case of

new developments or redevelopments"

Explanation: -

(3) The land so reserved shall be free from

any construction by the owner or promoter

or developer. The land for communal and

recreational purposes shall be restricted

at ground level in a shape and location to

be specified by the MMDA"

The Development Control Rule is the integral

part of the Master Plan and was framed under

section 17 of the Town and Country Planning

Act. The second respondent exercised the power

vested in it, since the total extent of the

petitioner's site is more than 10,000 m2, the

insisting of the requirements of reservation

of 10 % Open Space Reservation Area and

consequent direction to the petitioner to hand

over the same to the third respondent through

a registered gift deed as per Development

Control Rules 19(b)(II) (VI- C) is well within

the jurisdiction of the second respondent.”

“Para 8. The petitioner is challenging the

concept of reserving the 10 % area for open

space and recreational purposes. This is a

statutory requirement under Development

Control Rule 19 (b) (ii) (vi - c) for all the

proposals of group development, where the

extent of the site is more than 10,000 m2.

Further the city is fastly developing and

individual houses are being demolished and

multi family apartments are constructed in the

same site where there was only one family

residing therein earlier. The intense vertical

developments make the city more dense demanding

more water, pollution free air, noise free

atmosphere etc. The city is already over

congested and therefore more open spaces have

to be created wherever new developments or

redevelopment takes place. The open spaces so

created serve as long space to the city

benefiting the community at large. The open

space enable to make the environment clean and

provide fresh air, besides facilitating the

ground water recharge in a city where water

scarcity is a perennial problem.”

“Para 9. The petitioner has also questioned the

transfer of open space reservation in favour

of the Madras Corporation. It is submitted that

in practice, the developers take up the

development of properties and construct the

buildings providing necessary open spaces as

per Development Control Rules. After

completion of the construction they sell out

the building in portions to various persons and

later the open space reserved become no man's

land without any care for its maintenance. If

the ownership of the open space reservation for

communal and recreational purpose, suppressing

the facts later, after passage of time.

Therefore, it is essential that the ownership

of the open Space Reservation area should be

vested with the civic authority, which is

responsible for the maintenance of the parks

and play fields in the city. The civic

authority is maintaining many parks and play

grounds such as Elliot's Beach Garden, Anna

Nagar, Thiru Vi Ka park etc. Which are

maintained very well. It is also therefore

essential that the open Space Reservation Area

should be located in a location shape and size

which is accessible from the public road not

only to the Civic Authority but also to the

general public without any restriction.

Therefore, transferring the OSR area to the

Civic body will not amount to talking away the

rights of the property owner and it is intended

for the benefit of the community at large.”

“Para 10. In the case of the petitioner, it is

submitted that the 10 % Open Space Reservation

Area is very close to his hotel buildings.

Therefore, if the ownership were to be vested

with the petitioner, it is most likely to be

misused by the petitioner for Hotel related

activities, rather than allowing it to the use

of general public. It is also likely that over

a period of the time the OSR area would be

misused for commercial purposes by the

petitioner under the guise of improving it.

The petitioner has also expressed that the

maintenance of the 10 % Open Space Reservation

Area will be done by him. It is submitted that

the entrusting the maintenance of the Open

Space Reservation area is at the discretion of

the second and third respondents. The

development Control Rule 19 (a) (II) (Vii)

prescribes as follows:

" The authority reserves the right to enforce

the maintenance of such reserved land by the

owner to the satisfaction of the Authority or

order the owner to transfer the land to the

authority or local body designated by it, free

of cost, through a deed, to the Authority or

the local body designated by the authority as

case may be, reserve the right to dedicate on

entrusting the maintenance work to institution

/ individual o merits of the case.

It is submitted that as per the provisions of

the Development Control Rule 19 (b) (II) (Vii)

this second respondent reserves the right to

decide on entrusting the maintenance of OSR

area to the petitioner. It become the bounden

duty of the state Government to safeguard the

interest of the public at large and the state

government have the statutory power and have

approved the development control rules as an

integral part of the master plan for the

benefit of the public and to enforce it

accordingly. Therefore, the reservation of 10%

OSR area in a statutory requirement. Under the

above said circumstances the petitioner is not

deprived of their right of enjoyment of the

properly by implementing of the rules framed

under the Town and Country Planning Act. The

writ petition is devoid of merits and the same

has to be dismissed in limini.

Therefore, it is prayed that this Hon’ble Court

may be pleased to pass an order by dismissing

the writ petition and thus render justice”.

(Emphasis supplied)

8. The Corporation of Madras also filed a counter

affidavit. Therein it was inter alia stated that the

OSR land should have access from a public street as per

which the development authority directed the petitioner

to execute the gift deed to the Corporation as it had

to be used for communal and recreation purpose. In the

reply affidavit, the petitioner took the stand that the

impugned rule does not fall under Section 17. The OSR

under the Act is only an amenity for the benefit of the

property owner. The rule was projected as an executive

order falling beyond the Act. Any misuse could be dealt

with under the law.

CREDAI; Writ Petition No. 591/15 under Article 32

9. The last of the litigation with which we are

concerned is Writ Petition no. 591 of 2015. This is a

writ petition sought to be maintained under Article 32.

The writ petition has been filed by an association

which the petitioner describes as the Confederation of

the Real Estates Developers Association of India

(CREDAI).

10. This petition is filed under Article 32 of the

Constitution of India. It is filed by a Federation of

registered Association claiming to be an Apex body of

the organised union and state real estate developers,

builders across India. In the Additional affidavit

filed, it is contended that the total number of members

of Petitioner is 350 and that of Chennai Chapter is 163

members. The relief sought in the writ petition is as

follows:

“(a) allow the present writ petition and issue

a writ of Certiorari quashing Regulation

29(7)(a) (at pg.221 Vol. 2) as well as Annexure

XX (at pgs.293-294 Vol. 2) of the Development

Regulations for Chennai Metropolitan Area

issued by the Respondent No.2 as being ultra

vires, unconstitutional and violative of the

fundamental rights of the Petitioner; and”

11. However, in the additional affidavit filed on

8.12.2021, we may notice paragraph 4.

“4. That, in so far as challenge to Regulation

29(7)(a) in the present writ petition is

concerned, the petitioner is restricting its

challenge only to the latter part of the

provision i.e., the requirement to transfer

free of cost through a registered gift deed,

10% area reserved for recreational purposes

only and not the space set apart for roads.”

12. We may notice the grounds taken in the writ

petition. It is contended that by the impugned

regulations there is expropriation of the private

property of the petitioner’s members Association.

Reliance is placed on the judgment in Chet Ram Vashist

(Dead) by LRs v. Municipal corporation of Delhi1.

Support is drawn from Article 300A. It is sought to be

contended that allowing use of the OSR Area amounts to

a blatant exercise of the power of eminent domain.

Transfer of property of the petitioner is sought to be

achieved through the impugned regulation. In fact, in

1 (1995) 1 SCC 47

ground (i), it is submitted that expropriation of land

is possible at best by way of plenary legislation and

the impugned regulation not being such a legislation,

it is vulnerable. The impugned regulation is contrary

to the Act. The Act regulates the land use. The

authorities under the Act cannot change the user of a

land. In other words, the point is that allowing use

of area meant for recreational purpose by the members

of the general public is expropriatory and contrary to

the Act. It is also contended that the impugned

regulation is unreasonable and disproportionate.

13. We have heard Shri Gopal Sankaranarayanan, learned

Senior Counsel on behalf of the appellants in C.A. No.

7847 of 2013. We also heard Shri N Subramaniyan,

learned counsel on behalf of M/s. Keyaram Hotel Pvt.

Ltd. (C.A. No. 7334 of 2013). We further heard Smt. V.

Mohana learned senior counsel on behalf of the writ

petitioner (writ petition no. 591 of 2015). We also

heard the learned counsel on behalf of the appellants

in C.A. No. 1890-91 of 2010. We further heard the

learned counsel Shri K.S. Suresh on behalf of

Association of Vasanth Apartments’ Owners which has in

C.A. No. 7848 of 2013 challenged the judgment rejecting

the review petition filed in the writ petition

unsuccessfully challenging the rule.

14. We heard Shri Sanjay R. Hegde learned senior

counsel on behalf of the corporation of Chennai and

heard Shri Amit Anand Tiwari, AAG on behalf of the

Government of Tamil Nādu and also the CMDA. We finally

heard Shri JayanthMuth Raj, learned Senior Counsel on

behalf of the appellants in Writ Appeal no. 478 of 2007

who are the persons residing in the area and whose writ

appeal stood allowed by the High Court.

SUBMISSIONS OF APPELLANTS/PETITIONER

15. In Civil Appeal Nos. 7847 of 2013, Shri Gopal

Sankaranarayanan would contend that a compelled gift

attracted the wrath of Article 300A of the

Constitution. There was clearly deprivation of

property. It was without the authority of law. It was

without the authority of law because ‘DCR’ was not

statutory in nature, having been made by the CMDA

without any provision enabling it to make statutory

rules. The power to make rules was vested with the

State Government under Section 122 of the Tamil Nadu

Town & Country Planning Act, 1971 (hereinafter referred

to as the ‘Act’). Section 9C relied upon by the

respondents did not clothe the authority with power to

make rules. Equally, Section 17 would not come to the

aid of the respondents. Therefore, the rule was not law

within the meaning of Article 300A. There is no law

made by the competent legislature empowering

deprivation of the property of the appellants.

16. Even a law made by the legislature could not result

in the deprivation of property in the manner which is

purported to be achieved through what is described as

a rule which in fact is not a statutory rule. It is his

contention that the survey of the Act would reveal that

wherever the land is reserved, the lawgiver has

contemplated that the land should be acquired. The

concept of acquisition is traced to Entry 42 of List

III of Part VII of the Constitution. In other words,

unless land is acquired under the relevant law which

undoubtedly involves payment of compensation there

would be no justification in law to compel a person to

part with his property by what is described as a

compelled gift. There is no compensation payable under

the gift admittedly. Therefore, this amounts to the

execution of the gift which is a direct result of the

rule which so mandated the execution of the gift. It

is clearly expropriatory. The law at any rate, it is

contended that is, the impugned rule, is palpably and

manifestly arbitrary. Similar arguments have, no doubt,

been addressed by the other learned senior counsel

appearing on behalf of both the appellants and the writ

petitioner. There are various other ancillary

submissions which had been taken up.

17. There is also a further case that the rule falls

foul of Article 14 for another reason. It is complained

that the rule produces classification which is not

permitted under Article 14. In other words, it is

pointed out that for layout upto 3,000 sq. metres,

there is no requirement to execute a gift. In respect

of layout which is in excess of 3,000 sq. metres and

which is less than 10,000 sq. metres, there is no such

requirement and in place of a gift, it is open to the

proponent of the project to give the equivalent value.

It is without any rational basis, and therefore,

attracting the vice of class legislation or

unreasonable classification resulting in equals being

treated differently, that in respect of projects

involving more than 10,000 square metres, the builder

is bound to execute a gift in favour of the authority.

SUBMISSIONS OF SHRI N. SUBRAMANIYAN,

ADVOCATE IN C.A. 7334 OF 2013 [KEYARAM

HOTELS P. LIMITED]

18. In this case, the appellant is the owner and

continues to be the owner of the layout area. The gift

was effected as per an undertaking given to the High

Court but subject to the Writ Petition. Secondly, there

is no laches or delay. Immediately as the condition was

sought to be imposed, the Writ Petition was filed in

the year 1995. At best, Rule 19 can be only a Statutory

Order/Notification/ Guideline and it cannot be

considered more than a Subordinate Legislation. Relying

on the principles laid down for impugning Subordinate

Legislation in State of Tamil Nadu v. P. Krishnamurthy2,

it is contended that the Rule, Rule 19(b)(2)(vi)(c)

2 (2006) 4 SCC 517

violates Sections 36 to 39. Harmoniously reading

Section 17 and Section 20 and Sections 36 to 39 of the

Act, would establish that the reserved lands (made for

open spaces) under Section 17(2)(k) and Section

20(1)(k), should be acquired within three years,

failing which, the lands shall get reverted to the

owner. In the case of regulating the use of lands, such

as putting restrictions on the use of land under Section

17(2)(l) and Section 20(1)(n), within the planning

area, do not call for compensation. Section 17(2)(b),

as also Sections 21(1)(k) and (n) relating to detailed

development plans, are the only provisions dealing with

the open spaces. Proviso to Section 39(1) require the

respondents to pay compensation for all items, except

the matters that fall under Section 17(2)(l) and

Section 20(n), again, both of which are regulatory.

Sections 48, 49 and 52 to 54 are projected to contend

that the object of the Act is to regulate the

development and not to deprive land. Sections 52 to 54

also mandate, payment of compensation. Exceptions to

the ’Pay compensation’ principle, involve cases, where

there is no mandate to reserve land for public purposes.

There is no power, as claimed under Sections 9C, 17, 20

and 35 or Section 124, to make the impugned Rule. It is

further contended that the impugned Rule contravenes

and is inconsistent with the Sections 6(2), 12 and 18

of the Tamil Nadu Apartment Ownership Act, 1994 and,

hence, is void. The appellant, having developed two

blocks, the developed building comes under the said

1994 Act. It applies to apartments constructed prior to

its commencement. The impugned Rule, being inconsistent

with Sections 6(2), 12, 18, 25 and 26 of the Act had

become inoperative. The impugned Rule is alleged to be

violative of the Land Acquisition Act, 1894 and hence,

void, in view of Article 254(2) of the Constitution. It

is sought to be contended that since Entry 42 of the

Concurrent List provides for acquisition and

requisition, any State Legislature, seeking to put in

place, a law to acquire lands with lesser compensation,

it would be impermissible. It would be discriminatory.

The Act took care to incorporate Land Acquisition Act

by reference under Section 36 of the Act. This meant

that depravation of property, without compensation, was

not contemplated. Sections 36 and 37 are invoked. Even

the State Legislature has no power to seek transfer of

lands to the State free-of-cost. Even a single owner

could construct a luxury independent bungalow with 3000

square meters and he will not be required to spare any

land to society whereas 184 owners who constructed 184

flats with each family having 59.7 square meters would

have to spare 10 per cent of their land free-of-cost.

This is unconscionable. No civilised society would

expect or require or steal someone’s property for their

betterment and the Rule of Equality requires the

beneficiary to share the costs. Appellants rely on

Rustom Cavasjee Cooper (Banks Nationalisation) v. Union

of India3, Nagpur Improvement Trust and another v.

Vithal Rao and others4, K.T. Plantation Private Limited

and another v. State of Karnataka5. The appellant would

pray that the Rule be declared null and void and it be

declared that the ownership of the OSR lands revert

back to the appellants.

3 (1970) 1 SCC 248

4 (1973) 1 SCC 500

5 (2011) 9 SCC 1

SUBMISSIONS OF MS. V. MOHANA, SENIOR

ADVOCATE ON BEHALF OF THE WRIT PETITOINER

IN WRIT PETITION (CIVIL) NO. 591 OF 2015.

19. The objections to the challenge to the Regulation

on the ground that the Rule/Regulation had continued on

the Rule Book for long, cannot, by itself, be a ground

to repel the challenge. [See Shayara Bano v. Union of

India and others6 and Indian Young Lawyers Association

(Sabarimala Temple-IN RE) v. State of Kerala and

others7]. Doctrine of Laches and Delay cannot become a

constitutional limitation on court’s power.

Expropriation of property can only be done by plenary

legislation, i.e., by Parliament or by State

Legislature. Rule, made under the Rule-making power

cannot empower the deprivation of any substantive

right, which include property. An expropriatory law

must, at any rate, be construed strictly and must not

be brought to life in the absence of specific express

provisions [See Nareshbhai Bhagubhai and others v.

Union of India and others8]. The State is blowing hot

6 (2017) 9 SCC 1

7 (2019) 11 SCC 1

8 (2019) 15 SCC 1

and cold in regard to power to make Regulations.

Reference is made to Sections 47 and 55 to contend that

the bar on compensation will not apply in case of

deprivation of property. Neither the provisions of the

master plan nor provision relating to control of

development, authorised deprivation of property without

payment of compensation. The present is a case of no

compensation and not nil compensation. The decision in

K.T. Plantations Limited v. State of Karnataka9, is

relied upon. The laudable object cannot legitimise the

violation of the Fundamental Right or Constitutional

Guarantee. It is pointed out that in Ground-K of the

Writ Petition, it is contented that arbitrary

restrictions on the petitioner to use his property

through Executive action, attracted Article 14. It is

further pointed out that Fundamental Right violation is

projected in Grounds-L, M and N. Equally, Article 300A

and Article 14 forms the subject matter of Grounds-C,

D, E, F, G, H, I and J, it is submitted. It is contended

that the repeal of the Regulation, which is impugned,

by the Rules of 2019, would not save the Regulation

9 (2011) 9 SCC 1

from the vice of invalidity. Reliance is placed on the

decision of this Court in Behram Khurshid Pesikaka v.

State of Bombay10. The impugned Regulations would

constitute law for the purpose of Article 13 in this

regard. The declaration of the Regulation falling foul

of Fundamental Rights, would have the effect of

rendering such law void ab initio. Reliance is placed

on the 2019 Rules and the repealing and saving provision

[Rule 74(3)]. It is contended, in short, that the rights

and obligations, apart from the express savings under

the 2019 Rules, would remain intact. With reference to

Sections 49 and 50 of the Act, it is contended that

permissions under the Development Regulations of 2008

would continue to be governed by the Regulations. Thus,

repeal does not render the present Writ Petition

academic or infructuous. The fact that the petitioner

is an Association of real estate developers cannot

detract from the matter being justiciable and a

Constitutional Court should not countenance technical

pleas, when Fundamental Rights are at stake. When

otherwise, considering the importance of this matter,

10 (1955) 1 SCR 613

bearing in mind the interplay between the Fundamental

Rights and Article 300A, this Court, despite any delay,

should consider the challenge. Petitioner is

restricting the challenge to Regulation 29(7)(a) only

to the latter part, viz., the requirement to transfer

free-of-cost, the 10 per cent area reserved for

recreational purposes. Section 20(1)(d), employing the

word ‘otherwise’, cannot encompass a gift. A gift would

be without compensation, which would be contrary to the

provisions of the Act. Sections 36 to 39 make it clear

that whenever an acquisition was contemplated, it was

deemed to be a public purpose and payment of

compensation has been provided for. If gift is

comprehended in Section 20(1)(d), it would be in

conflict with Section 39. Earmarking or reserving an

area, may not constitute an injury. But the compulsory

gifting of the same, without any compensation, coupled

with changing of the character of the property from

private to public, reaches an injury. The person must

be compensated. Reliance is placed on Sahu Madho Das

and others v. Pandit Mukand Ram and another11 and

11 (1955) 2 SCR 22

Rajendra Shankar Shukla and others v. State of

Chhattisgarh and others12. Reliance is placed in M.

Krishnasamy v. Member Secretary, Chennai Metropolitan

Development Authority, Gandhi Irwin Road, Egmore,

Chennai-8

13 to contend that a Single Judge of the Madras

High Court doubted the very demand for conveying of OSR

land. Regulatory law, depriving a person of property,

must be strictly construed. In this regard reliance is

placed on B.K. Ravichandra and others v. Union of India

and others14. Section 124, under which Regulations can

be made, cannot empower any Authority to create or

takeaway or deprive a person of their property, by a

manner, not provided for under the Act [See Indian Young

Lawyers Association and others (Sabarimala Temple-In

Re.)15]. The Regulation represents the case of action

in excess of power. The lands, which have been

transferred, are not being used for the purpose of open

space. They are being used as dump yard or other use.

The valuable easementry rights or lung space of the

12 (2015) 10 SCC 400

13 (2013) 1 CTC 80

14 2020 SCCONLINE SC 950

15 (2019) 11 SCC 1

residents are lost. The frontage of the property and

its aesthetic appearance is affected. The rights of the

members of the petitioners’ Association under Article

19(1)(g) is violated. In answer to the contention of

the respondent, that wherever compensation is

compulsorily payable, the Constitution itself has made

provision as is clear from Article 30(1A) it is sought

to be rebuffed. It is pointed out that Article 30(1A)

is only an additional protection. Compensation must be

paid, when property is deprived for a public purpose.

Reliance is placed on decisions of this Court,

including the decision of this Court in Lalaram and

others v. Jaipur Development Authority and another16.

The Court is requested to mould the relief

appropriately so that the lands so transferred in

favour of the Authority may be reverted to the persons

directly benefiting therefrom, i.e., the Residents’

Welfare Associations or the residual owners of the

developed areas. It is further prayed that the Court

may fix a time limit, within which, interested parties

to whom the land is to be reverted may apply for seeking

16 (2016) 11 SCC 31

such reversion. No other developments/redevelopments

should be made on such lands except in accordance with

law.

20. Shri Sanjay Hedge, learned Senior Counsel, for the

Corporation of Chennai, supported the judgments. He

contended that the impugned provision promoted a

salutary goal. He highlighted the public interest

involved.

SUBMISSIONS OF SHRI AMIT ANAND TIWARI;

ADDITIONAL A.G. ON BEHALF OF STATE OF TAMIL

NADU AND ‘CMDA’.

21. Section 124 of the Act confers powers to make the

Regulations. Reliance is placed on Section 9C(ii) to

empower CMDA to prepare the master plan or any detailed

development plan. Reliance is also placed on Section

17. The DCR and the Regulations are part of the master

plan. Section 2(36) defines ‘public purpose’ as ‘any

purpose which is useful to the public or any class or

section of the public’. Reserving any site, plot for

communal/recreational purposes in layout plan, is

public purpose. Section 47 is relied upon to contend

that the DCR is statutory in nature. Equally, Sections

17, 18 and 20 are invoked along with Section 124, to

contend that the DCR is statutory. Section 2(15) of the

Act includes master plan. Sections 105 and 111 give an

overriding effect to the Act. All the Rules and

Regulations, which will include the master plan, are to

prevail notwithstanding anything inconsistent with the

same contained in any other law, inter alia. Further,

it is contended that the DCR and the Regulations have

been subsumed under the Tamil Nadu Combined Development

and Building Rules, 2019. Rule 74(3) of the 2019 Rules,

is relied upon to contend that it creates a legal

fiction that anything done under the Rules/Regulations,

is deemed to have been done under the 2019 Regulations.

Reliance is placed on Judgment in Bengal Immunity

Company Limited v. State of Bihar and others17. The word

‘including’ extends and enlarges the scope of the

Clause [See State of Jammu & Kashmir v. Lakhwinder Kumar

and others18]. If challenge to the Rules/Regulations

succeeds, it will also render the sanction of the

17 (1955) 2 SCR 603

18 (2013) 6 SCC 333)

development plans, illegal, which will necessitate

petitioners applying afresh under the 2019 Rules,

whereunder also, the prescription of 10 per cent land

being gifted, exists.

22. It is further contended that the

Rules/Regulations, being part of the master plan, are

statutory and being framed under the Statute, they

operate as law under Article 300A. Reliance is placed

on Pune Municipal Corporation and another v. Promoters

and Builders Association and another19. Reliance placed

by appellants on Pt. Chet Ram Vashist (Dead) by Lrs. v.

Municipal Corporation of Delhi

20, is alleged to be

misplaced. In the said case, there is no provision in

the Delhi Municipal Corporation Act, 1957, under which,

the Corporation could pass a Resolution to ask the

appellant therein to transfer property free of cost. It

is further contended that the Court may bear in mind

that the Act replaced the Tamil Nadu Town and Country

Planning Act, 1920, which was based on the British Town

and Country Planning and Housing Act, 1909. From the

19 (2004) 10 SCC 796

20 (1995) 1 SCC 47

Statements of Objects and Reasons, it is contended that

the Act was based on the Model Town and Country Planning

Bill, which was prepared by the Ministry of Health and

Housing of the Government of India after a

comprehensive study of various Town Planning Enactments

in the western countries. The regional concept in the

Maharashtra Town and Country Planning Act, 1966 also

made its presence felt. The Act is designed to serve

legitimate state interest of planned development down

to the regional limit. Crowded urban areas, create

adverse living conditions. The reservation of open

space for parks and playgrounds is universally

recognised. The decision of this Court in Bangalore

Medical Trust v. B.S. Muddappa and others21, is relied

upon. It is contended that the Act requires only the

simple laying of Rules and Regulations under Section

123 of the Act. The laying of the Rules, which is not

mandatory, if not followed, will not affect the

validity of the Rules/Regulations. The terms of Section

123(2) are relied upon to contend that the Rules will

come into effect even before they are placed before the

21 (1991) 4 SCC 54

Legislative Assembly and any modification made by the

Assembly, will apply only from the date it is carried

out. Reliance is placed on Atlas Cycle Industries Ltd.

and others v. State of Haryana22. It is further

contended that acquisition under Chapter IV of the Act

is not required in the facts. The area is not reserved

in the master plan nor was any Notice published under

Section 26 or 27. Acceptance of appellant’s contention

would involve the need to compulsorily acquire all the

reserved lands including areas such as setback areas,

open spaces and other reserved area. Such

interpretation would also render the provisions of

Chapter VI, in particular Section 55, otiose. Chapter

IV apply to areas reserved and notified in the master

plan itself or to an area in excess of 10 per cent for

proposed developed area of 3000 and above square meters

or where area reserved is sought to be utilised for

purpose not being communal or recreational, or areas,

for which, there are other exceptions in the impugned

Rules/Regulations. Section 20(1)(d) stipulates that a

detailed development plan may propose or provide for

22 (1979) 2 SCC 196

acquisition by purchase, exchange or otherwise, of any

land. The words ‘or otherwise’ include a transfer of 10

per cent of the land by way of a gift. It is further

contended that there is no constitutional obligation to

pay compensation. The Act contemplates divestment of

property without compensation as is evident from

Sections 31 and 55 read with Sections 17 and 20. It is

a settled position of law that Article 300A does not

involve or compel payment of compensation. Support is

drawn from Judgment of this Court in K.T. Plantation

Private Limited and another. v. State of Karnataka23:

“183. Payment of compensation amount is a

constitutional requirement under Article 30(1-

A) and under the second proviso to Article 31-

A(1), unlike Article 300-A. After the Fortyfourth Amendment Act, 1978, the constitutional

obligation to pay compensation to a person who

is deprived of his property primarily depends

upon the terms of the statute and the

legislative policy. Article 300-A, however,

does not prohibit the payment of just

compensation when a person is deprived of his

property, but the question is whether a person

is entitled to get compensation, as a matter

of right, in the absence of any stipulation in

the statute, depriving him of his property.

xxx xxx xxx

23 (2011) 9 SCC 1

192. At this stage, we may clarify that there

is a difference between “no” compensation and

“nil” compensation. A law seeking to acquire

private property for public purpose cannot say

that “no compensation shall be paid”. However,

there could be a law awarding “nil”

compensation in cases where the State

undertakes to discharge the liabilities

charged on the property under acquisition and

onus is on the Government to establish validity

of such law. In the latter case, the Court in

exercise of judicial review will test such a

law keeping in mind the above parameters.

xxx xxx xxx

205. Plea of unreasonableness, arbitrariness,

proportionality, etc. always raises an element

of subjectivity on which a court cannot strike

down a statute or a statutory provision,

especially when the right to property is no

more a fundamental right. Otherwise the court

will be substituting its wisdom to that of the

legislature, which is impermissible in our

constitutional democracy.”

23. It is contended that nil compensation, as

contemplated in paragraph 192, is applicable as a State

undertakes to discharge liability for providing spaces

for requirement for recreational and communal use,

which is a public purpose. The area taken under the

gift deed from the appellant in Civil Appeal No. 7334

of 2012 has been developed as a walkers’ park and used

by the public. It is contended that town planning

legislation has been viewed differently as it served a

legitimate State interest. Even in the United States,

where the Fifth Amendment to the U.S. Constitution

contemplates compensation for taking, for public use,

private property, courts have upheld validity of zoning

regulations which substantially limit the rights of the

owners to develop land. Compensation has been refused.

Reliance is placed on Agins v. City of Tiburon24. In

India, there is no constitutional guarantee for payment

of compensation especially when they are required to

serve a legitimate public purpose. The gift of

property, apart from serving the larger interest of the

community, would also be conducive to the interests of

the appellants. Refuting the contention of the

appellants that the land which is transferred can be

used only by the members of the society and not by the

members of the general public, it is pointed out that

since reservation is for communal and recreational

purposes, the word ‘communal purpose’ must be

understood to mean that it is meant for community at

large. In the case of proposed development area being

24 447 US 255 (1980)

3000 square meters – 10000 square meters, ‘public

access is specifically excluded, as the

Rules/Regulations provide that public access to area

earmarked for transfer to Authority, will not be

insisted upon’.

24. There is no violation of Article 14. Classification

based on size of plot has a clear nexus with the object,

viz., planned development. Reliance is placed on

Judgment of this Court in State of Maharashtra and

another v. Basantibai Mohanlal Khetan and others

25. As

far as Civil Appeal No(s). 1890-1891 of 2010 is

concerned, the complaint of the appellants that the

land transferred under the gift was being made use of

as a road, which is impermissible, it is contended that

it is misleading. It is the case of the respondent that

the 10 per cent land transferred, already had a kachha

road on the said land and it was being used by the

public. The appellants tried to prevent the use of the

road. The High Court considered the Report of the Court

Commissioner and concluded that furbishing of the road

served a larger public interest and provided better

25 (1986) 2 SCC 516

connectivity to a larger population. Alternatively,

assuming communal purpose, would not include

construction of roads on OSR land, in the facts of the

case, appeal is made that this Court may not interfere

in the Extraordinary Jurisdiction under Article 136.

SUBMISSIONS MADE BY SRI JAYANTH MUTHRAJ,

SENIOR ADVOCATE RESPONDENTS NOS. 1 AND 2 IN

C.A. NO. 1890 OF 2010.

25. The developers had transferred, in the interest of

public, 1100 square meters of land, to the Authority

for roads, parks and other open spaces by the gift deed

dated 18.02.1994. In the year 2003, the Corporation of

Chennai laid metal road, which provided a direct and

short link to the Velacherry 100 feet bypass road to

enable thousands of general public to have easy access

and movements. The appellant-association has no locus

as it is neither the owner of the property nor has any

usage right been assigned to it. The CMDA is the

absolute owner of the gifted property. The public road

was laid as per the terms of the gift. The property is

used for communal purpose. The word ‘communal’ means

public. He relies on the definition of the word

‘communal’ in the International Websters Comprehensive

Dictionary of the English Language Encyclopaedic

Edition (2004 Edition) to mean ‘common; public;

belonging to a community’. He also would contend that

the DCR was prepared in accordance with Section 17 read

with Section 9C, Section 20(1)(d) and Section 20(1)(k)

and Section 35 with Section 124. Rules and Regulations

are authorised. He relies on the Judgement of this Court

in R.K. Mittal and others v. State of Uttar Pradesh and

others26and New Delhi Municipal Council and others v.

Tanvi Trading and Credit Private Limited and others27.

The impugned Rule is not an expropriatory action. It is

only regulatory. The Rule is informed by intelligible

differentia having a nexus with the object. The

challenge is academic as the DCR is already repealed by

the Regulation made on 02.09.2008. There is latches in

filing the Writ Petition after 13 years of the execution

of the gift deed. Even assuming the Rule is bad, the

gift deed is beyond challenge. The appellants having

maintained Writ Petition (Civil) No. 4766 of 2007,

26 (2012) 2 SCC 232

27 (2008) 8 SCC 765

based on the gift deed, cannot challenge the validity

of the gift deed in the subsequent Writ Petition.

Estoppel and constructive res judicata are principles

which are enlisted in support.

SUBMISSIONS BY SHRI K.S. SURESH, ADVOCATE IN

CIVIL APPEAL NO.7848 OF 2013

26. Shri K.S. Suresh, learned counsel appearing in C.A.

No. 7848 of 2013, (the appeal by Vasanth Apartment

Owners Association challenges the order in the review

petition) would submit that there is no power to compel

gift of land which is not required, reserved or

designated. He refers to Section 36 and would contend

that there is no power beyond the same to demand the

transfer of land. The rule providing for a compelled

gift is not within the objects, provisions and policies

of the Act. One of the zones reserved is for open space

and recreational use. Sections 36 and 37 only provide

for acquisition of land in such zones. Legislative

policy is not to acquire land without paying fair market

value. Planning permission cannot result in deprivation

of property. The DCR are not the rules made under the

Act. The authority is competent only to make regulation

under Section 124. In the absence of express power to

demand a gift, there cannot be an implied power. The

Act is regulatory and not a taxing legislation. The

appellants are entitled to restitution. Otherwise, he

adopts the arguments of the Shri Gopal Sankarnarayanan

made in C.A. No. 7847 of 2013. He would also in his

rejoinder submission point out that support cannot be

derived from Section 17 having regard to Section 12. He

would reiterate the argument that the State Government

also has no power relying on the judgment reported in

(2003) 5 SCC 622. He would contend that the words in

Section 122(1) empowering making rules ‘for carrying

out the purposes of the act’ is unbridled and it must

be understood as meant for regulating the use of land.

ANALYSIS

27. We have noticed the facts in the case of Vasanth

Apartments and in the case of Keyaram Hotels. In the

case of Vasanth Apartments, the land which was gifted

by the owner in compliance with the impugned rule has

been sought to be made use as a road. In the case of

Keyaram Hotels the pertinent point which must be

noticed is that the OSR area is not sought to be so

maintained as road but access to the public by having

an entrance to the area through a public road is sought

to be projected as being contrary to the very concept

of OSR meant for communal purpose, if the word

‘communal’ is to be understood as being confined to

benefit the interest of the community which in the

context of the case is the community of persons who

patronise the hotel and who used the facilities

provided in the hotel and its premises.

28. Whether impugned rule is statutory or it has

statutory underpinning? Whether it is law?

The argument of the appellants appears to be, that the

impugned rule is not a statutory rule. Instead, the

further case is that the impugned rule is not a rule

made under Section 122 of the Act. Section 123

contemplates placing of rules made under Section 122

before the legislative assembly. The said procedure has

not been followed as regards the impugned rule.

Therefore, it is not open to the respondents to claim

that the impugned rule is a statutory rule. It is

nothing but an executive fiat. If it is merely executive

in nature, then it is not open to the respondents to

direct the owners to execute a gift deed of valuable

property, and thus, deprive the owners of the rights

over their property.

29. The argument, on the other hand, of the respondents

is that the DCR of which the impugned rule, is a part

of the Master Plan and there is statutory authority in

regard to the making of a Master Plan located in Section

17 of the Act. In other words, the argument of the

respondents is that the court, when it approaches the

issue raised in this case, cannot have a pedantic view

and understand a Master Plan as one which is limited or

confined to mere drawings. The Master Plan as

contemplated in the Act in regard to a Metropolitan

Authority like the CMDA must be viewed on a larger

canvass. The plan was put in place for catering to the

needs of an ever-growing Metropolis. Various

restrictions necessarily have to be put in place to

provide for an orderly development of such a sprawling

urban area. The larger public interest of the entirety

of the residents of such an area had to be envisaged

and it is in this regard that the concept of OSR must

be viewed. The Master Plan goes to meticulous details

about what is permitted and what is not.

30. A perusal of the writ petition No.23397 of 2007

being the petition filed by the Association of Vasanth

Apartments Owners wherein Rule 19 has been challenged,

reveals the following pleading:

It is specifically stated that Rule 19 of the DCR

which forms part of the Master Plan prepared under

Section 17 of the Act mandates reservation of 10% as

open space for open and recreational facilities when

the area exceeds 10000 sq. meters. The gift in the

case was executed in the year 1994 (16.02.1994). It

is further contended that under the rule the second

respondent was to maintain it either on their own or

through the local body. The second respondent is the

authority. Thereafter since the second respondent has

not developed OSR area as park, petitioner wanted to

maintain the OSR as Park. Reference is made to Writ

Petition No. 4766 of 2007 and the developments

including the order passed by the learned single judge

and also writ appeal (writ appeal no. 478 of 2007)

wherein an interim order was passed. Thus, the writ

petition is filed in the year 2007. Now let us look

at the grounds urged:

(1) Rule 19(b) of the DCR is beyond the rule making

power conferred on the first respondent. The

Act does not empower the first respondent (the

State of Tamil Nadu) to make the DCR. Section 36

contemplates acquisition where land is reserved

for open space. Therefore, the rule is ultra

vires.

(2) There is an absolute right to enjoy the property.

This is a constitutional right under Article 300A

of the Constitution. Unless there is acquisition

and payment of due compensation, Article 300A is

violated. Therefore, the rule is

unconstitutional.

(3) The rule empowers the Authority to maintain the

OSR area themselves or through others without

permitting owners to themselves to do so. The

respondents have no right to possess and manage

the same. Therefore, the impugned rule

authorising the second respondent to maintain

and manage the OSR area is unconstitutional.

(4) The DCR not having been placed before the

legislative assembly, it has no force of law.

(5) The impugned rule without any guideline enables

exercise of arbitrary power.

(6) There is no power with first respondent State to

usurp the lands free of cost, and that too

selectively, under the guise of regulating the

development of the area.

The prayer is to declare Rule 19 (b) of the DCR

relating to group development in so far as it mandates

the transfer of 10% area of the layout of any

developmental plan having area 10,000 sq. meter or

more reserved as open space for communal and

recreational purposes to the second respondent or the

local body designated by it, free of cost through a

registered deed and empowering the second respondent

or any authority other than the association of

resident owners to maintain the said OSR area of the

respective layout, and the gift deed executed and

registered as Document No.262 dated 18.02.94 in the

office of the 4th respondent pursuant to the impugned

rule are unconstitutional and null and void and

consequently direct the 3rd respondent to enter in

their records the members of the petitioner

Association as Owners of the said OSR area and pass

such further or other orders as this Hon’ble Court

may deem fit and proper in the circumstances of the

case and thus render justice.

31. Before we deal with the issue we must bear in mind

as to what is law. Article 13 of the Constitution reads

as follows: -

“Article 13. Laws inconsistent with or in

derogation of the fundamental rights. — (1) All

laws in force in the territory of India

immediately before the commencement of this

Constitution, in so far as they are

inconsistent with the provisions of this Part,

shall, to the extent of such inconsistency, be

void.

(2) The State shall not make any law which

takes away or abridges the rights conferred by

this Part and any law made in contravention of

this clause shall, to the extent of the

contravention, be void.

(3) In this article, unless the context

otherwise requires, —

(a) “law” includes any Ordinance, order, byelaw, rule, regulation,

notification, custom or usage having in the

territory of India the force of

law;

(b) “laws in force” includes laws passed or

made by a Legislature or other competent

authority in the territory of India before the

commencement of this Constitution and not

previously repealed, notwithstanding that any

such law or any part thereof may not be then

in operation either at all or in particular

areas.

[(4) Nothing in this article shall apply to any

amendment of this

Constitution made under article 368.]”

32. Existing law has been defined in Article 366. It

reads as follows: -

“Article 366. (10) “existing law” means any

law, Ordinance, order, bye-law, rule or

regulation passed or made before the

commencement of this Constitution by any

Legislature, authority or person having power

to make such a law, Ordinance, order, bye-law,

rule or regulation;”

33. Law in force is an expression found in Article 372

of the Constitution. It reads as follows: -

“Article 372. — The expression “law in force”

in this article shall include a law passed or

made by a Legislature or other competent

authority in the territory of India before the

commencement of this Constitution and not

previously repealed, notwithstanding that it

or parts of it may not be then in operation

either at all or in particular areas.”

34. Section 3(29) of the General Clauses Act, 1897

defines Indian Law as:

(29) “Indian law” shall mean any Act,

Ordinance, Regulation, rule, order, bye-law or

other instrument which before the commencement

of the Constitution, had the force of law in

any Province of India or part thereof, or

thereafter has the force of law in any Part A

State or Part C State or Part thereof, but does

not include any Act of Parliament of the United

Kingdom or any Order in Council, rule or other

instrument made under such Act;

35. In Salmond on Jurisprudence 12th Edition, it is

profitable to notice the following discussion:

Law as the dictate of reason: natural law

The idea that in reality law consist of rules

in accordance with reason and nature has formed

the basis of a variety of natural law theories

ranging from classical times to present day(q).

The central notion is that there exist

objective moral principles which depend on the

essential nature of the universe and which can

be discovered by natural reason, and that

ordinary human law is only truly law in so far

as it conforms to these principles. These

principles of justice and morality constitute

the natural law, which is valid of necessity,

because the rules for human conduct are

logically connected with truths concerning

human nature.

Law as the command of the sovereign: imperative

law

Diametrically opposed to the theory of natural

law is the positivist, or imperative, theory

of law (j). This theory distinguishes the

question whether a rule is a legal rule from

the question whether it is a just rule (k),

and seeks to define law, not by reference to

its content but according to the formal

criteria which differentiate legal rules from

other rules such as those of morals, etiquette,

and so on.

Xxx xxx xxx

According to Austin, whose version of the

theory will be considered here, positive law

has three characteristic features. It is a

type of command, it is laid down by a political

sovereign and it is enforceable by sanction.

Xxx xxx xxx

We must now distinguish commands which are laws

from commands which are not. Imagine a state

governed by an absolute ruler R. Here the law

is what R command. But is the converse true?

Are all R’s commands law?

Xxx xxx xxx

Now if particular commands can qualify as laws,

how can we distinguish laws from commands which

are not? Everyday life is sprinkled with

examples of people giving commands to others:

masters give orders to servants, teachers to

pupils, parents to children and so forth.

Xxx xxx xxx

Such criticism overlook the importance of

Austin’s second requirement: for to qualify as

law a command must have been given by a

political superior, or sovereign.

Xxx xxx xxx

To define law as a command can mislead us in

several ways. First, though this may be a not

in appropriate way of describing certain

portions of law such as the criminal law, the

greater part of a legal system consists of laws

which neither command nor forbid things to be

come, but which empower people by certain means

to achieve certain results: e.g., laws giving

citizens the right to vote, laws conferring

on lease-holders the right to buy the

reversion, laws concerning the sale of property

and the making of wills: indeed the bulk of

law of contract and of property consists of

such power-conferring rules. At this point the

theory could be saved by arguing that a rule

conferring a right on one person is really an

indirect command addressed to another: a law

empowering the citizen to vote is really an

order to the returning officer to register the

vote.

Xxx xxx xxx

Thirdly, “command” conjures of the picture of

an order given by one particular commander on

one particular occasion to one particular

recipient. Laws differ in that they can and

do continue in existence long after the

extinction of the actual law-giver (r).

Xxx xxx xxx

But whether we define law as a command or a

rule, we must still distinguish commands (or

rules) which are law from those which are not.

For Austin, as we saw, a command can only be

law if it emanates from a sovereign. This

raises the question how far there can exist

laws other than those made by the sovereign.

Obviously in a complex modern state it would

be impossible for a sovereign to enact every

legal rule: much law-making will in fact be

done by subordinates to whom legislative powers

have been delegated. A good deal of English

law consists of such delegated legislation,

e.g., regulation made by Ministers under Acts

of Parliament. Here Austin finds no problem,

since he sees no difficulty in the notion of a

sovereign conferring law-making powers on

others (u).

36. The distinguishing feature of law has been the

subject matter of considerable debate and we may only

for the purpose of these cases note that one of the

essential features which mark out law from an executive

order is that ‘law’ has general application. In other

words, law sets out principles and rules which apply to

all of those who would be within its purview otherwise.

A law is not to be viewed as particularised decisions

of the executive. Law is generally to have operation in

the future. This court speaking through O. Chinnappa

Reddy, J. held in Union of India and Another v. Cynamide

India Limited and Another.

28:

“5. The second observation we wish to make is,

legislative action, plenary or subordinate, is

not subject to rules of natural justice. In the

case of Parliamentary legislation, the

proposition is self-evident. In the case of

subordinate legislation, it may happen that

Parliament may itself provide for a notice and

for a hearing — there are several instances of

the legislature requiring the subordinate

legislating authority to give public notice and

(1987) 2 SCC 720

a public hearing before say, for example,

levying a municipal rate — in which case the

substantial non-observance of the statutorily

prescribed mode of observing natural justice

may have the effect of invalidating the

subordinate legislation…”.

“7. The third observation we wish to make is,

price fixation is more in the nature of a

legislative activity than any other. It is true

that, with the proliferation of delegated

legislation, there is a tendency for the line

between legislation and administration to

vanish into an illusion. Administrative,

quasi-judicial decisions tend to merge in

legislative activity and, conversely,

legislative activity tends to fade into and

present an appearance of an administrative or

quasi-judicial activity. Any attempt to draw a

distinct line between legislative and

administrative functions, it has been said, is

“difficult in theory and impossible in

practice”. Though difficult, it is necessary

that the line must sometimes be drawn as

different legal rights and consequences may

ensue. The distinction between the two has

usually been expressed as “one between the

general and the particular”. “A legislative act

is the creation and promulgation of a general

rule of conduct without reference to particular

cases; an administrative act is the making and

issue of a specific direction or the

application of a general rule to a particular

case in accordance with the requirements of

policy”. “Legislation is the process of

formulating a general rule of conduct without

reference to particular cases and usually

operating in future; administration is the

process of performing particular acts, of

issuing particular orders or of making

decisions which apply general rules to

particular cases.” It has also been said:

“Rule-making is normally directed toward the

formulation of requirements having a general

application to all members of a broadly

identifiable class” while, “an adjudication,

on the other hand, applies to specific

individuals or situations”. But, this is only

a broad distinction, not necessarily always

true. Administration and administrative

adjudication may also be of general application

and there may be legislation of particular

application only. That is not ruled out. Again,

adjudication determines past and present facts

and declares rights and liabilities while

legislation indicates the future course of

action. Adjudication is determinative of the

past and the present while legislation is

indicative of the future. The object of the

rule, the reach of its application, the rights

and obligations arising out of it, its intended

effect on past, present and future events, its

form, the manner of its promulgation are some

factors which may help in drawing the line

between legislative and non-legislative acts.”

37. Paton in his work on Jurisprudence says this about

the law.

“Law may shortly be described in terms of a

legal order tacitly or formally accepted by a

community. It consists of the body of rules

which are seen to operate as binding rules in

that community, backed by some mechanism

accepted by the community by means of which

sufficient compliance with the rules may be

secured to enable the system or set of rules

to continue to be seen as binding in nature. A

mature system of law normally sets up that type

of legal order known as the State, but we

cannot say a priori that without the State no

law can exist.”

38. In the DCR the preamble recites that Section 9 (c)

of the Act prescribes that the Authority is to carry

out a survey of the Chennai Metropolitan Area and

prepare a Master Plan referred to in Section 17. It is

further stated that having carried out necessary

surveys and studies, the Master Plan prepared in 1975

stood approved by government on 04.12.1976. The DCR

inter alia provides as follows:

No development as defined in the Act is permissible

without written permission. It provides for the

manner of obtaining permission. Rule 3 proclaimed

that no development shall be in contravention of

the DCR. Site approval is made mandatory. The land

use classification was put into place. The DCR

divided land use in terms of 9 separate zones which

included primary residential zone, mixed

residential zone, institutional use zone, open

space and recreational use zone etc. There were

detailed restrictions put in place qua the zones in

regard to what activities were permitted as also

what were prohibited. Part III commencing with Rule

17 was captured under the Caption ‘General

Provisions’. It is under this chapter that Rule 19

made its appearance. Rule 19 dealt with Layout and

sub division. It inter alia provided for passage,

streets and roads and cul-de-sacs and it is

thereunder that in respect of reservation of land

for communal and recreational purpose in a layout

or sub division that the DCR contemplated inter alia

the impugned provisions. Rule 20 provided for

parking. Rule 21 dealt with architectural control.

Rule 22 provided for preservation of buildings of

historical or architectural interest. Rule 23 dealt

with tree preservation. Rule 24 dealt with

advertisement control. Rule 25 provided for Airport

zone and Microwave Zone. In fact, Rule 26 may be

noticed at this stage in full.

“26. These rules to prevail :- (a) In the

application of these rules if there is conflict

between the requirements under these rules and

the requirements under any other Act or rules

or by laws in force the requirements under

these rules and the provisions of Chennai City

Municipal Corporation Act, Tamil Nadu Distrit

Municipal Act or Panchayat Act or any other law

relating to the local authority for the time

being in force or any rule, by law or

regulation made under the said act or laws,

such provisions which are contrary to these

rules shall stand suspended. (b) The

notifications made under the Municipal and

Panchayat Acts and the Tamil Nadu Public Health

Act, 1939 (Tamil Nadu Act III of 1939) as

regards setting of the Industrial and

Residential area in the Chennai Metropolitan

Area will cease to operate from the date of

commencement of these rules. 27.”

Rule 27 dealt with identification of boundaries. Rule

28 provided for delegation of power. Rule 29 made

contravention of the rules punishable with fine.

39. Section 9(c) must be read along with Section 17 of

the Act. Section 9 (c)(ii) declares that subject to the

provisions of the Act and the rules made under the Act,

the functions of the Authority is to inter alia prepare

a Master Plan referred to under sub-Section (2) of

Section 17. Section 17 deals with Master Plans. Section

17 contemplates that the Local Planning Authority

(which is mentioned under Section 4(b) of the Act) shall

within such time as may be prescribed and after

consulting the Regional Planning Authority (see Section

4(a) of the Act) and the Local Authority, prepare and

submit to the Government, a Plan called the Master Plan.

Section 17(2) reads as follows:

“(2) The master plan may purpose or provide for

all or any of the following matters, namely: -

(a) the manner in which the land in the

planning area shall be used;

(b) the allotment or reservation of land for

residential, commercial, industrial and

agricultural purposes and for parks, playfields and open spaces;

public buildings, institutions and for civic

amenities;

(d) the making of provision for national

highways, arterial roads, ring roads, major

streets, lines of communication including

railways, airports and canals;

(e) the traffic and transportation pattern and

traffic circulation pattern;

(f) the major road and street improvements;

(g) the areas reserved for future development,

expansion and for new housing;

(h) the provision for the improvement of areas

of bad layout or obsolete development and slum

areas and for relocation of population;

(i) the amenities, services and utilities;

(j) the provision for detailed development of

specific areas for housing, shopping,

industries and civic amenities and educational

and cultural facilities;

(k) the control of architectural features,

elevation and frontage of buildings and

structures;

(l) the provision for regulating the zone, the

location, height, number of storeyes and size

of buildings and other structures, the size of

the yards and other open spaces and the use of

buildings, structures and land;

(m) the stages by which the master plan shall

be carried out;

and (n) such other matters as may be

prescribed.”

40. The Act as noted contemplates preparation of

detailed development plan also. Section 24 of the Act

contemplates that as soon as may be after the Master

Plan inter alia has been submitted to the Government,

the Government may not later than the time prescribed

direct the appropriate Planning Authority to make such

modification in the Master Plan inter alia. Thereupon,

the modified Plan has to be resubmitted to the

Government. Thereupon, the Government may give the

consent for publication of the notice under Section 26

of the preparation of the Master Plan inter alia.

Moving on to Section 26, it contemplates publication in

the Gazette, of the notice of the preparation of the

Master Plan inter alia. The notice must indicate the

place or places where the copies may be inspected. More

importantly, objections and suggestions in writing are

to be invited within such period as is specified in the

said notice. The period shall not be less than two

months from the publication of the notice. Section 26

(2) contemplates that a reasonable opportunity of being

heard must be provided to any person including

representative of the Government Authority, who have

made any objection. The Planning Authority can make

amendments based on the objections and with the

amendments, if any, carried out, the Plan is again

submitted to the Government. Section 28 contemplates

approval by the Government after consulting the

Director of Town and Country Planning of the Plan

submitted under Section 26(2). The approval may be with

or without modification. Again, it is open to the

Government to return the Plan, to modify the plan, or

to prepare a fresh Plan in accordance with such

directions as the Government may issue in this behalf

and resubmitted to the Government for approval. The

approval which is granted under Section 28 by the

Government to a Master Plan inter alia is to be

published by the Government in the gazette and leading

newspapers. The notification must indicate the place

and time at which the Plan shall be open to inspection

to the public. The Plan shall come into operation from

the date of publication in the Tamil Nādu Government

Gazette. Section 32 of the Act provides for variation,

revocation and modification of regional plans, Master

Plan and the new development plan, at any time, by a

subsequent plan prepared and approved under the Act.

41. Even according to the petitioner in Association of

Vasanth Apartments Owners, the DCR is a part of the

Master Plan. This is precisely the argument of the

respondent as well. We are in agreement with the stand

taken by the petitioner and the respondent. The DCR is

a part of the Master Plan. The process involved in the

making of the Master Plan points to active

participation of all stakeholders. The plan which is

apparently tentatively prepared must first receive

approval from the Government before the notice of its

preparation is published. It is upon such notice being

published, objections are also invited. It is open to

the Planning Authority to amend the Plan, paying heed

to the objections found to be with merit. Again, the

matter goes to the Government. Government has the power

again to return it. Government as well may approve the

Plan. As we have already found Master Plan cannot be

conflated with a set of drawings or maps. It must, in

the context of law in question, be extended to encompass

within its embrace rules by which alone the Plan can

become workable and the sublime goal of the lawgiver

attained. The Master Plan accompanied with the DCR were

to hold sway. It was to have general application. It

was intended to bind everyone. It created rights and

liabilities. It was not intended for any particular

person. It was to operate in the future. It carried

with it the attributes of law. The Government all

throughout plays the pivotal and leading role and it is

only with the imprimatur of approval by the Government

that the Plan read with the Rules assumed force.

Government undoubtedly had power to make rules under

Section 122 of the Act. We would therefore hold that

the DCR which held the field till 2008 when Regulations

were enacted had the force of law.

42. It is profitable for us at this juncture to look

at what a learned single judge had to say regarding the

history of the ‘DCR’ and the regulation. Justice V.

Ramasubramanian, while judge of the High court, has

rendered judgment reported in M. Krishnasamy V. The

Member Secretary, Chennai Metropolitan Development

Authority and Another29. It was rendered on 25.09.2012.

The petitioner therein challenged a communication by

the member secretary of the authority rejecting the

request to waive open space reservation charges for the

grant of planning permission. The amount of OSR charge

demanded was Rs.58,50,000. It was the contention of the

petitioner therein that the charges could be levied

only if land of an extent equivalent to 10% of the

total area was not reserved for open space and conveyed

to the local body. It was his case that his predecessor

in title had already earmarked 10% of the total area

and handed it over to the Corporation of Chennai. A

draft deed of conveyance was also submitted by his

predecessor which could not be executed on account of

the lethargy on the part of the corporation but

possession was taken in 1976. The learned single judge

went on to find as a matter of fact that though a gift

deed as such was not executed, the land was in public

2013 1 CTC 80

domain for the past 36 years and no one except the

local body would lay a claim on the said land. The

Court held;

“Para 12. Though in paragraph 10 of the counter

affidavit, the first respondent has claimed

that OSR land was neither gifted nor handed

over to the Corporation, the same appears to

be an incorrect statement. The Corporation has

categorically confirmed that the land of the

extent of 6 grounds 170 sq. ft., had been

handed over by the original owner. This is also

corroborated by (i) a letter of the Assistant

Engineer of the Corporation of Chennai dated

29.1.1976 and (ii) the handing over-taking over

certificate dated 11.2.1976 signed by an

Officer of the Deputy Collector's office and

the Corporation of Chennai. The fact that the

said land has been developed into a park and

that it is now maintained by the Corporation

of Chennai, is beyond any pale of doubt. But

it is equally true that no deed of

conveyance/gift was executed and registered by

the original promoter in favour of the

Corporation. Nevertheless, the land is in

public domain for the past 36 years and no one

except the local body, can today lay a claim

on the said land of the extent of 6 grounds

and 170 sq. ft. Therefore, on the first

question, it has to be held that OSR land has

already been handed over to the local body.”

43. Thereafter it is interesting that the learned

Single Judge holds as follows: -

“Para 13. Incidentally it must be pointed out that

in Pt. Chet Ram Vashist vs. Municipal Corporation

of Delhi {1995 (1) SCC 47}, the Supreme Court held

that the effect of reserving any site for open

space, park etc., in a layout is that the owner

ceases to be a legal owner of the land in dispute

and that he would hold the said land for the

benefit of the society or the public in general.

It was further held in the said decision that the

entitlement of the Corporation or the local body

to demand the transfer of the land to them, is not

made out from the provisions of any Act or on any

principle of law. The Court pointed out that the

Corporation may get a right as custodian of public

interest to manage it in the interest of the

society in general. However, the right to manage

as a local body, was held by the Supreme Court in

the said decision, to be not the same thing as to

claim transfer of the property to itself. The

decision in Pt. Chet Ram Vashist, was followed in

Chairman, Indore Vikas Pradhikaran vs. Pure

Industrial Coke & Chemicals Ltd {MANU/SC/7706/2007

: 2007 (8) SCC 705}. Again in Babulal Badriprasad

Varma vs. Surat Municipal Corporation

{MANU/SC/7606/2008 : 2008 (12) SCC 401}, the

Supreme Court pointed out that a statute of town

planning ex facie is not a statute for acquisition

of a property. The Court further observed that

every step taken by the State does not involve

application of the Doctrine of Eminent Domain.”

Para 16. At this juncture, a small prelude is

necessary, to understand how the liability to

earmark open space for public and recreational

purposes, in a land developed into a layout and

how the liability to pay OSR charges, came into

existence. Hence it is presented as follows: -

(i) Section 9C, Chapter II-A of the Tamil Nadu

Town and Country Planning (Amendment) Act, 1973

(Tamil Nadu Act No. 22 of 1974) prescribed that

the Madras Metropolitan Development Authority

shall carry out a survey of Madras Metropolitan

area and prepare a Master Plan as referred to in

Section 17.

(ii) Accordingly, MMDA carried out necessary

surveys and studies and prepared the First

Master Plan for the Chennai Metropolitan Area in

1975. The Government approved the same in

G.O.Ms. No. 2395, Rural Development and Local

Administration dated 4.12.1976.

(iii) The First Master Plan covered an extent of

approximately 1170 sq. kms. It included within

the City of Chennai, a part of Ambattur Taluk,

Tambaram Taluk, Tiruvallur Taluk, Chengalpet

Taluk, Sriperumbudur Taluk, Ponneri Taluk and

Poonamallee Taluk.

(iv) Under the said Plan, all lands in the

Metropolitan Area were categorised into 10 zones

such as Primary Residential Use Zone, Mixed

Residential Use Zone, Commercial Use Zone, Light

Industrial Use Zone, General Industrial Use

Zone, Special and Hazardous Industrial Use Zone,

Institutional Use Zone, Open Space and

Recreational Use Zone, Agricultural Use Zone and

Non-Urban Use Zone.

(v) Along with the First Master Plan, a set of

rules known as Development Control Rules were

issued by the Government. These rules dealt with

(i) permission for development (ii) use zones

and (iii) general provisions.

(vi) Rule 19 of the Development Control Rules,

which comes under Part III, under the heading

"General Provisions" deals with layout and

subdivision.

(vii) The liability to reserve a portion of the

site in a layout as open space, arose out of

Rule 19 of the Development Control Rules, till

these rules were in operation.

Para 17. Rule 19 of the Development Control Rules

contains a Table which prescribes the minimum

width of the streets and roads in different types

of layouts. Just below the Table under Rule 19,

there is a Note. The said Note contains 3

prescriptions. The third prescription in the

said Note contains a Table indicating the extent

of land to be reserved for communal and

recreational purposes in a layout or subdivision

for residential, commercial, industrial or

combination of such uses.

Para 21. It may be of interest to note that at

the time when the First Master Plan was conceived

in 1975, the concept of "Group Development" or

"Flats", had not gained momentum in the City of

Chennai. Therefore, the Development Control

Rules did not contain specific provisions to

regulate the same. But when developers started

promoting flats, the issue was taken up by the

Madras Metropolitan Development Authority with

the Government, in a letter dated 22.3.1981. On

the basis of the said letter of the Member

Secretary and the recommendations of the

Technical Committee of MMDA and the response of

the public to the proposed amendment to the

Rules, the Government issued G.O.Ms. No. 940,

Housing and Urban Development, dated 8.10.1982,

approving the Draft Rules for incorporation in

the Development Control Rules with certain

modifications. They were issued by the

Government in exercise of the power conferred by

Section 32 of the Tamil Nadu Town and Country

Planning Act, 1971.

Para 22. By the Amendment so made to the

Development Control Rules, sub-rules (b) & (c)

were inserted under Rule 19. While sub-rule (b)

dealt with “Special Buildings”, sub-rule (c)

dealt with “Set Back” for residential and

commercial. Under Clause (v) of sub-rule (c) of

Rule 19, the extent of land to be reserved for

Community Recreational Purposes, was indicated

in a tabular column. It reads as follows:

Exent of

layout

(1)

Reservation

(2)

(i) For the

first 3000

sq.meters

Nil

(ii) Between

3000 square

meters and

10,000

square

meters

10% of the area excluding roads

or in the alternative, he/she

shall pay the market value of

the equivalent land excluding

the first 3000 square meters

as per the valuation of the

registration department. The

space so reserved shall be

maintained as Community

Recreational Space and shall

remain private.

(iii) Above

10,000

sq.meters

10% of the area excluding roads

shall be reserved and this

space shall be transferred to

the Authority or to the local

body designated by it, free of

cost, through a deed. It is

obligatory, to reserve the 10%

space of the site area and no

charges can be accepted in

lieu.

Para 23. But in so far as “Group

Development/Flats” are concerned, the open space

to be reserved for Community Recreational

Purposes was indicated in a separate Table in the

same Government Order G.O.Ms. No. 940, dated

08.10.1982, as follows:

Exent of

layout

(1)

Reservation

(2)

(i) For the

first 3000

sq.meters

Nil

(ii) Between

3000 square

meters and

10,000

square

meters

10% of the area excluding roads

or in the alternative, he shall

pay the market value of the

equivalent land excluding the

first 3000 square meters as per

the valuation of the

Registration Department. The

space so reserved shall be

maintained as Community

Recreational Space and shall

remain private.

(iii) Above

10,000

sq.meters

10% of the area excluding roads

shall be reserved and this

space shall be transferred to

the Authority or to the local

body designated by it, free of

cost, through a deed. It is

obligatory to reserve the 10%

of the site area and no charges

can be accepted in lieu.

Para 24. Rule 19(a) & (b) was amended further by

G.O.Ms. No. 35, Housing and Urban Development,

dated 9.1.1989. But the Amendments introduced by

the said Government Order covered only layouts

of the extent between 3,000 sq.meters and 10,000

sq.meters. In other words, layouts of larger

extents above 10,000 sq.meters, were not covered

by the said Amendment.

Para 25. There appears to be a subsequent

amendment. Though the year of such amendment is

not clear, the Development Control Rules hosted

in the Internet by the CMDA, as amended upto

September 2004, contains two Tables, one in

respect of normal buildings under Rule 19(a) and

another in respect of “Special Buildings and

Group Developments” under Rule 19(b). The Table

under Rule 19(a) is as follows:

Exent of layout

(1)

Reservation

(2)

For the first 3000

square meters

Nil

Between 3000 square

meters and 10,000

square meters

10 percent of the

area excluding

roads or in the

alternative he

shall pay the

market value of

equivalent land

excluding the first

3000 square meters

as per the

valuation of the

registration

department. “No

such area reserved

shall measure less

than 100 square

meters with a

minimum dimension

of 10 meters”.

The space so

reserved shall be

transferred to the

Authority or to the

Local body

designated by it,

free of cost,

through a deed, and

in turn the

Authority or the

Local body may

permit the

residents

Association or Flat

Owners'

Association for

maintaining such

reserved space as

park. In such cases

public access for

the area as

earmarked shall not

be insisted upon.

Above 10,000 square

meters

10 percent of the

area excluding

roads shall be

reserved and this

space shall be

maintained as

Community

Recreational Open

Space to the

satisfaction of the

authority or

transferred to the

authority for

maintenance. It is

obligatory to

reserve 10 percent

of the layout area.

Para 26. The Table under Rule 19(b) in respect

of Special Buildings, is as follows:

Exent of

layout

(1)

Reservation

(2)

For the

first 3000

square

meters

Nil

Between

3000

square

meters and

10,000

square

meters

10 percent of the area

excluding roads or in the

alternative shall pay the

market value of the

equivalent land excluding the

first 3,000 square meters as

per the valuation of the

Registration Department only

where it is not possible to

provide open space due to

physical constraints. No such

area reserved shall measure

less than 100 square meters

with a minimum dimension of

10 meters.

The space so reserved shall

be transferred to the

Authority or to the Local

Body designated by it, free

of cost, through a deed, and

in the turn the Authority or

the local body may permit the

Residents Association or Flat

Owners' Association for

maintaining such reserved

space as park. In such cases,

public access for the area as

earmarked shall not be

insisted upon.

Above

10,000

square

meters

10 percent of the area

excluding roads shall be

reserved and this space shall

be transferred to the

authority or to the local

body designated by it, free

of cost, through a deed. It

is obligatory to reserve the

10 percent space of this site

area and no charges can be

accepted in lieu, in case of

new developments or

redevelopments.

Para 27. After a spurt in developmental

activities, the CMDA felt a need for a Second

Master Plan for the Chennai Metropolitan Area.

Therefore, a Draft Second Master Plan 2011 was

prepared and submitted to the Government and the

Government gave its consent to it under G.O.Ms.

No. 59, Housing and Urban Development Department,

dated 30.6.1995. After public consultation, it

was submitted to the Government in December 1995

for approval. But approval could not be granted

on account of an interim prohibitory order

granted by this Court in a Writ Petition. Though

the Writ Petition W.P. No. 14819 of 1995 was

eventually dismissed on 10.7.2001, the

Government returned the Draft Second Master Plan

to the CMDA for suitable modifications. This was

under G.O.Ms. No. 408, dated 5.10.2001.

Para 28. Thereafter, a revised Draft Second

Master Plan with the year 2026 as the horizon

year, was prepared and submitted to the

Government in December 2005. The Government again

returned it under G.O.Ms. No. 331, H & UD

Department, dated 5.12.2006, with a direction to

incorporate certain developments in the field and

to submit a fresh proposal for consent. This was

done in February 2007 and the Government gave its

consent on 30.3.2007.

Para 29. Thereafter, copies of the Draft Second

Master Plan were made available to the public and

also hosted in the official website of the First

Respondent. Subsequently public consultations

were conducted in April and July 2007 and a twoday workshop was also held in August 2007.

Thereafter, the draft was finalised and submitted

to the Government. Finally, the Second Master

Plan for Chennai Metropolitan Area was approved

by the Government of Tamil Nadu in G.O.Ms. No.

190, Housing and Urban Development, dated

2.9.2008 and it was notified in the Gazette on

the same day. As part of the Second Master Plan,

a set of Regulations known as “Development

Regulations” were issued and they came into force

on 2.9.2008.

Para 30. Regulation 26 of the Development

Regulations 2008, contains stipulations

regarding “Special Buildings”. A Special

Building is defined in Regulation 2(40) to mean

(i) a residential or commercial building with

more than two floors, or (ii) a residential

building with more than 6 dwelling units or (iii)

a commercial building exceeding a floor area of

300 sq.meters.”

44. After referring to Rule 27 dealing with group

developments and Rule 29 which dealing with layout and

sub division regulations and finding it to correspond

to Rule 19 of the DCR and further noticing Rule 27 in

greater detail, the learned Single Judge then proceeds

to hold further as follows: -

“Para 34. A careful survey of (i) the

provisions that existed from 1975 till 2008

under the First Master Plan and the Development

Control Rules, and (ii) the provisions that

exist with effect from 2008 under the Second

Master Plan and the Development Regulations,

would show that layouts had always been

classified into 3 categories. They are, (i)

those whose total land extent is upto 3,000

sq.meters, (ii) those whose total land extent

is between 3,000 sq.meters and 10,000

sq.meters, and (iii) those whose total land

extent is above 10,000 sq.meters.

Para 35. Consistently, the Development Control

Rules which were in force till 2008 and the

Development Regulations which are in force from

2008, have exempted layouts whose total extent

of land is upto 3,000 sq.meters, from the

obligation to reserve any open space.

Similarly, the Rules have consistently given

two options, either to hand over 10% of the

area excluding roads or to pay the market value

of equivalent land, in so far as layouts whose

total extent of land is between 3,000 sq.meters

and 10,000 sq.meters.

Para 36. But, in respect of layouts whose total

extent of land is above 10,000 sq.meters, the

Rules have always insisted upon handing over

of Open Space Reservation land to the extent

of 10% of the total area. In respect of layouts

whose total extent is above 10,000 sq.meters,

it was made clear by the successive Government

Orders that no charges in lieu of 10% of the

area can be accepted. This is borne out by—

(1) G.O.Ms. No. 743, Housing and Urban

Development, dated 10.5.1979,

(2) G.O.Ms. No. 940, Housing and Urban

Development, dated 8.10.1982,

(3) the Development Control Rules as of

September, 2004 (hosted in the official

website) and the Table contained therein under

Rules 19(a) & 19(b), and

(4) Regulation 29 and Annexure XX under the

Development Regulations of the year 2008.”

We are fortified in our conclusion that the Rule

in question was statutory in nature. Section 123 (2)

contemplates that every rule made under the Act is to

be laid as soon as may be on the table of the

Legislative Assembly and it inter alia enables the

Assembly to modify the rule and if the Assembly decides

that the rule should not be made or give it a modified

operation or no effect, then such a decision of the

Assembly will prevail. It is to be noticed that this

is after providing that unless otherwise expressed, the

rules come into force on the day on which they are

published in the Gazette. This shows that the rule has

life without reference to the Legislative Assembly. It

is undoubtedly true that Section 122 speaks of the

power of the Government to make rules. While it is true

that the Master Plan is to be prepared by the CMDA and

the rules would form part of the Master Plan, the scheme

of the rules would show that it is only with the

approval of the Government that the rules along with

the Master Plan come into force. We have already

noticed the effect of Section 32 as indeed it was

considered by the learned Single Judge in the judgment

we have referred to.

THE GIFT DEED IN VASANTH APARTMENTS CASE

45. The complaint about there being no rationale in

allowing a developer who develops a layout which is

between 3000 sq.m. and 10000 sq.m. to pay the equivalent

is to be found both in the circumstance that it is

permitted only when there is a physical complaint and

also it is obvious that the local Authority would be

expected to plough back the money equivalent into

making available alternate facility by way of OSR in

such cases.

46. It is necessary to notice the relevant facts in the

case relating to Vasanth Apartments in greater detail.

The writ petition filed by the Association of Vasanth

Owners is in the year 2007. The Vasanth Apartments is

located at 100 feet bye-pass road, Velacherry. The

apartments were promoted as group developments in terms

of approval granted by the CMDA on 16.05.1997. The

Apartments consist of 12 blocks, out of which 11 blocks

consist of 4 storeys and house about 180 dwellings. The

total area of the layout is more than 10,000 sq. mtr.

10% of the total area consisting of 1164 sq. mtr. was

reserved for use as OSR. A gift was executed on

10.02.1994 under the DCR. The CMDA was either to

maintain the OSR area on its own or to permit the

appellant Association to maintain the same. 180

families residing in the campus do not have any park

and any recreational facility despite the OSR.

Thereafter, there is reference to attempts being made

by some persons to encroach on the said OSR area for

some other purposes. Several loads of earth was dumped

in the OSR area. The case on the other hand of the

respondents as can be seen from the writ appeal is that

at the time of construction, the land owners earmarked

the portion of the land, that is, 11836 sq. feet, as

open space regulation (OSR area) for road and park and

gifted the same as per the gift deed. The second

respondent Corporation has formed road in that land

during the year 2003 itself and was maintaining the

same. It is their case that the appellant Association

was blocking the said road. The said road is a shortest

link from West Vellachery to East Vellachery - Vijay

Nagar and this road gives access to Venkateshwara

Nagar, MGR Nagar and Devikarumariamman Nagar etc.,

where one lakh people are living in Vellachery.

47. Now, it is necessary to notice the actual terms of

the gift deed which was executed on 18th February, 1994.

The relevant terms read as follows: -

“GIFT DEED

This indenture made on this 18th day of

February 1994.

between

1. Shri K.S. Dasarathan, Hindu, aged about 48

years.

2. Smt. D. Inbanayagi, Hindu, aged about 40

years, wife of Shri K.S.Dasarathan.

both residing at 84, Dr. Natesan Road,

Mylapore, Madras-4.

3. Shri G.T. Murugesan, Hindu, aged about 45

years.

4. Smt. M. Jayalakshmi, Hindu, aged about 40

years, wife of Shri G.T. Murugesan.

both residing at No.35, Nainar Nadar Road,

Mylapore, Madras-4.

All represented by their Power Agent Shri M.S.

Rajamanickam, son of Shri M. Sivagnanam, aged

about 42 years, residing at 75, C.P. Ramasamy

Road, Alwarpet, Madras, hereinafter called

"THE DONOR" of the one part;

and

The Madras Metropolitan Development Authority,

represented by its Member Secretary, having

their office at No.8, Gandhi Irwin Road,

"Thalamuthu Natarajan Building", Egmore,

Madras, hereinafter called "THE DONEE" on the

other part;

WHEREAS the "DONOR" is well sufficiently

entitled, free from all encumbrances, the piece

of lands for roads and parks hereunder

described and intended to be hereby granted

conveyed and assigned.

WHEREAS the DONOR is the absolute GPA holder

of the property bearing S.No.379/1 (Part) and

380 / 4 (part) of Velacherry Village and

submitted a proposal for development of the

land in the above S.Nos. for residential

purposes. To comply with the rules and

regulations prevailing now, the DONOR in the

interest of public has agreed to transfer the

roads and park and other open space hereunder

described through a gift deed in favour of

DONEE and DONEE has agreed to accept the same.

Now this indenture witnesseth that the DONOR

doth hereby give, grant, convey and assign in

the interest of public unto the DONEE who

hereby accepts the same all that lands for

roads, parks and other open space situated in

S.Nos.379 / 1, (part) and 380 / 4 (part) which

is for the use of the public comprised in

layout sketch enclosed, within registration

subdistrict of Madras South and registration

district of Madras Central and more

particularly described in the schedule

hereunder written and the DONOR doth hereby

covenant with the DONEE that the DONOR now does

have good right to grant, convey and assign the

lands of roads/parks hereby granted conveyed

and assigned upto the "DONEE" with the manner

aforesaid and that the "DONEE" shall and may

at all times hereafter peacefully and quietly

possess and enjoy the said lands of roads/parks

free from all encumbrances whatsoever without

any lawful eviction, interruption, claim,

whatsoever, from or by the "DONOR" or any

person claiming under or interest for him and

further that the "DONOR" and all person having

lawfully or equitably claiming any rights on

roads/parks or interest with the said premises

or any part thereof from under or interest for

the "DONOR" or from or under any of his

ancestors shall and will from time to time and

at all times hereafter at the request of and

cost of the "DONOR" do execute and register or

cause to be done

executed and registered all such acts, deeds

and things whatsoever for further and more

perfectly assuring the said lands or roads and

parks every part thereof unto the "DONEE" in

the manner aforesaid or as shall or may be

reasonably required.

THE SCHEDULE OF PROPERTY

All that piece and parcel of lands measuring

1100 square meters reserved for parks/open

spaces and marked in colour of the layout

sketch enclosed herein situated in S.No.379/1

(part) and 380/4 (part) of Velacherry Village,

Saidapet Taluk, Madras and within the sub

registration District of Madras South and

Registration District of Madras Central.

The value of property Rs.1,99,000/-.”

WHETHER THE IMPUGNED RULE VIOLATES

ARTICLE 14 OF THE CONSTITUTION? IS IT

DISCRIMINATORY?

48. As far as this ground is concerned, we do not find

any reference to this line of argument before the High

Court. In the writ petition filed by the Vasanth

Apartments (writ petition no. 23397 of 2007) the only

feeble reference, if at all we can understand the same

to be one, is ground (F) where what is contended is

that the CMDA had no power under the Constitution to

usurp the lands of citizens free of cost, that too

selectively, under the guise of regulating the

development of the area. In the written submissions, no

doubt we may notice the following: -

“(v) Further, if a plot measuring 200m x 55m

abutting a road of wide 1O m and above if

developed by seeking a single approval, it

would attract the impugned rule of gifting 10%

area whereas if it is divided into 4 pieces of

50 m* 55 m and sold to 4 individuals and then

developed by the 4 persons, for the same

development, then the impugned rule will not

be attracted. Therefore, the impugned rule

mandating the transfer of OSR area free of cost

has no rational basis and hence arbitrary.

(vi) Further, if an open space is required for

public purpose, then every public would be

enjoying the same. The state may tax the public

based on wealth but can not tax only a person

who is proposing to develop an area of 10,000

sqm. Therefore, the classification has neither

any intelligible differentia nor has rational

nexus with the object of town Planning.

Therefore, the impugned rule is discriminatory

and hence violative of Art.14 of Constitution

of India.

The Hon'ble Court Supreme Court in Yogendra Pal

& others Vs. Municiplaity, Bhatinda, reported

in AIR 1994 Supreme Court 2550 [relevant para9] has held that the statutory provisions U/S

192(1)(c) of the Punjab Municipal Act'1911 and

U/S 203(1)(c) of Haryana Municipal Act'1973

enabling the State to seek transfer of land to

the extent of 25% of the private land free of

cost while developing a building scheme as

violative of Art.14 of the Constitution of

India. The Hon'ble Supreme Court while

upholding the said provisions as not violative

of Arts. 19(1)(f) and 31(2) (the then existing

provisions) of Constitution of India but held

the said provisions as violative of Art. 14 of

the Constitution of India.

Therefore, due to the aforesaid reasons, the

mandate under the impugned rule to transfer the

OSR area free of cost is without any basis and

hence arbitrary and unreasonable and

discriminatory and hence violative of Art.14

of the Constitution of India.”

49. In the review petition (filed as review application

no. 69 of 2008) also there is no contention seeking to

ventilate the complaint that the impugned rule falls

foul of Article 14 on the basis that it is

discriminatory.

50. We are concerned in this case with the provision

which provides for town planning. In regard to such

law, a certain measure of free play is to be given to

the planning authority bearing in mind that it is urban

planning what is involved. In regard to the grant of

development permit up to 3000 sq. mtr., the rules do

not contemplate any requirement in the matter of OSR.

It is a matter which goes to the wisdom and clearly

falls within the realm of policy. In other words, having

regard to the size of the development contemplated, the

authority has not found it fit to provide for

reservation under the head open space. It cannot be

described as being bereft of any rationale that upon

the minimum threshold of 3,000 sq. mtr. being breached

and the layout being between 3,000 sq. mtr. and 10,000

sq. mtr., 10% of the area excluding roads is to be

maintained as open space. In other words, 10% of area

would have to be reserved for communal and recreational

facilities. It is no doubt true that that in cases

falling in the said category namely group developments

which comprise of an area in excess of 3,000 sq. mtr.

and up to 10,000 sq. mtr., it is open to the project

proponent to pay the market value equal to the land on

the basis of valuation as provided therein. However, it

is only if on account of the physical constraints it is

not possible to provide open space, that payment is

contemplated. Another noteworthy feature is that in

cases where the land is between 3,000 sq. mtr. and

10,000 sq. mtr. public access for the area as earmarked

shall not be insisted upon. It is when it comes to a

case where if the area goes above 10,000 sq. mtrs.,

that it becomes obligatory to reserve 10% of the area

excluding road and the OSR reserved is to be transferred

by way of gift deed.

51. We are unable to persuade ourselves to hold that

the impugned rule violates Article 14 on the score that

it is discriminatory. In a challenge to a provision

based on discrimination under Article 14, the burden is

on the applicant to lay clear foundation in pleadings

and further to discharge the burden by making good the

case and the court will not lightly enter a finding of

discrimination. Town planning being a complex subject

involving various inputs and value judgements which are

intended to ensure the orderly, visionary and planned

development, they require greater deference from

courts.

IS THE IMPUGNED RULE/ REGULATION ULTRA

VIRES?

52. It has been contended on behalf of the

appellants/writ petitioner that the impugned provisions

represent a case of they being ultra vires. In General

Officer Commanding-in-Chief and another v. Dr. Subhash

Chandra Yadav and another30, this Court was considering

the validity of Rule 5C of the Cantonment Funds Servants

Rules, 1937. It was contended that it was contrary to

Section 280(2)(c) of the Cantonment Act, 1924. The

argument was accepted. The argument of the appellant,

that in view of the provision in the Parent Act that

Rules, when published, would have effect as if they

were enacted in the Act, was repelled. We notice only

the following discussion:

“14. This contention is unsound. It is well

settled that rules framed under the provisions

of a statute form part of the statute. In other

words, rules have statutory force. But before

a rule can have the effect of a statutory

provision, two conditions must be fulfilled,

namely, (1) it must conform to the provisions

of the statute under which it is framed; and

(2) it must also come within the scope and

purview of the rule-making power of the

30 (1988) 2 SCC 351

authority framing the rule. If either of these

two conditions is not fulfilled, the rule so

framed would be void. The position remains the

same even though sub-section (2) of Section 281

of the Act has specifically provided that after

the rules are framed and published they shall

have effect as if enacted in the Act.”

53. In Kunj Behari Lal Butail and others v. State of

H.P. and others31, the Parent Act conferred power on

the Delegate from the Government, to make Rules for

carrying out the purpose of the Act, a familiar

legislative device. The contention taken was that the

Rule in question revealed the Delegate surpassing its

authority. We notice the following discussion:

“8. … Tea estates are excluded from the

provisions of the Act by Section 5. “Tea

estate” is defined in the interpretation

clause of the Act to mean an area under tea

plantation and includes within the definition

“such other area necessary for purposes

subservient to a tea plantation as may be

prescribed”. Rule 3 defines what areas shall

be treated as subservient to a tea plantation.

The amendment made vide notification dated 4-

4-1986 places an embargo on the right to

transfer such subservient land though exempted

from the operation of the Act. Clearly the

impugned proviso is beyond the rule-making

power of the State Government as conferred by

the Act. It is well settled that the

legislature cannot delegate its essential

legislative functions which consist in the

31 (2000) 3 SCC 40

determination or choosing of the legislative

policy and of formally enacting that policy

into a binding rule of conduct. What is

permitted is the delegation of ancillary or

subordinate legislative functions, or, what is

fictionally called, a power to fill up the

details. [See: Principles of Statutory

Interpretation, Justice G.P. Singh, (7th Edn.,

1999, at pp. 689-90).]

9. In Supreme Court Employees' Welfare

Assn. v. Union of India [(1989) 4 SCC 187 :

1989 SCC (L&S) 569 : AIR 1990 SC 334] this

Court has held:

“(A) delegated legislation or a subordinate

legislation must conform exactly to the power

granted.”

(SCC p. 222, para 62)

“Rules, whether made under the Constitution or

a statute, must be intra vires the parent law

under which power has been delegated.”

10. In General Officer Commanding-inChief v. Dr Subhash Chandra Yadav [(1988) 2

SCC 351 : 1988 SCC (L&S) 542 : (1988) 7 ATC

296 : AIR 1988 SC 876] it has been held: (SCC

p. 357, para 14)

“[B]efore a rule can have the effect of a

statutory provision, two conditions must be

fulfilled, namely, (1) it must conform to the

provisions of the statute under which it is

framed; and (2) it must also come within the

scope and purview of the rule-making power of

the authority framing the rule. If either of

these two conditions is not fulfilled, the rule

so framed would be void.”

54. Finally, we may notice Global Energy Ltd. and

another v. Central Electricity Regulatory Commission32.

This Court laid down as follows:

“25. It is now a well-settled principle of law

that the rule-making power “for carrying out

the purpose of the Act” is a general

delegation. Such a general delegation may not

be held to be laying down any guidelines. Thus,

by reason of such a provision alone, the

regulation-making power cannot be exercised so

as to bring into existence substantive rights

or obligations or disabilities which are not

contemplated in terms of the provisions of the

said Act.

26. We may, in this connection refer to a

decision of this Court in Kunj Behari Lal

Butail v. State of H.P. [(2000) 3 SCC 40]

wherein a three-Judge Bench of this Court held

as under: (SCC p. 47, para 14)

“14. We are also of the opinion that a

delegated power to legislate by making rules

‘for carrying out the purposes of the Act’ is

a general delegation without laying down any

guidelines; it cannot be so exercised as to

bring into existence substantive rights or

obligations or disabilities not contemplated

by the provisions of the Act itself.”

[See also State of Kerala v. Unni [(2007) 2

SCC 365] (SCC paras 32 to 37) and A.P.

Electricity Regulatory Commission v. R.V.K.

Energy (P) Ltd. [(2008) 17 SCC 769 : (2008) 9

Scale 529] ]

32 (2009) 15 SCC 570

55. The case law is relied upon to contend that the

impugned provisions, in the cases before us, purport to

achieve, what is not contemplated by the Act. In other

words, the Act does not contemplate the execution of

the gift deed. It becomes impermissible for the

Delegate of the Law Giver to make subordinate

legislation to provide so. We may only finally notice

the recent Judgment of this Court in Indian Young

Lawyers Association and others (Sabarimala Temple-In

Re.) v. State of Kerala and others33, where this Court

has reiterated the aforesaid principles. (See

paragraphs 137 to 140 and paragraph 373).

THE IMPACT OF SECTIONS 36 AND 37

56. The appellants/petitioner would argue that

Sections 36 and 37 contemplate acquisition of the lands

which are reserved. This means that there cannot be a

gift deed, as contemplated in the impugned

Rules/Regulations.

33 (2019) 11 SCC 1

57. We are afraid that though at first blush, the

argument may appear to be attractive, it cannot pass

muster on a deeper scrutiny. What Section 36 provides

is, for power to acquire land, under the Land

Acquisition Act. It goes on to provide that any land

required, reserved or designated in a regional plan,

master plan, detailed development plan, is deemed to

be land needed for a public purpose under the Land

Acquisition Act. What is more, such land can be

acquired under the said law, as modified in the Act.

It is thereafter that Section 37 contemplates that upon

publication of the notice in a Government Gazette of

the preparation of the plan that any land is required,

reserved or designated in such plan, the appropriate

Planning Authority, which includes, no doubt, the CMDA,

can do two things: (1) It may enter into an agreement

for the acquisition by purchase of any land. It is

apparently land, which is covered by Section 36, which

means land which is required, reserved or designated

in a master plan, inter alia. (2) The Planning

Authority may apply to the Government for acquiring

such land under the Land Acquisition Act. Section 37(2)

goes on to provide that if an application is received

and if the Government is satisfied that the land is

needed for the public purpose, the Government may make

a declaration in the manner provided in Section 6 of

the Land Acquisition Act 1894. It will be noticed that

what is contemplated under Sections 36 and 37 is that

it is in regard to any land, which is required, reserved

or designated in a plan that the question of acquiring

such a land arises. In other words, if the property is

needed under the plan and it is shown as required,

reserved or designated, as such, in the plan, then, it

is open to the Authority acting in coordination with

the Government to acquire such land so that the lofty

goal of planned and orderly development, contemplated

in the plan, is achieved. In this connection, it is

relevant to notice that Section 37 kicks in immediately

upon the publication of a notice for the preparation

of the plan. The notice is published under Section 26

or Section 27. Such notice is published after the

consent of the Government is received under Section 25.

It is next relevant to notice Section 38. Section 38

allows the period of three years from the date of

publication of the notice under Section 26 or Section

27 for the Government to publish the declaration

contemplated under Section 37, which, no doubt, amounts

to a declaration under Section 6 of the Land

Acquisition Act. Section 38 provides that if the

declaration is not made under Section 37 of the Act,

the land shall be deemed to be released from such

reservation, allotment or designation. The time limit

of three years, not being observed for acquiring the

land by way of purchase, also has the same result,

viz., the land, which in the plan, is shown as reserved,

allotted or designated, shall be freed from such

reservation, allotment or designation.

58. We are, in these cases, dealing with the

reservation of land by a person, who applies for

development of the land and, more specifically, for the

purpose of group development. The person, who applies,

becomes obliged under Rule 19(b) to reserve 10 per cent

of his land excluding roads, for communal and

recreational purposes. This is a reservation to be made

by a person applying for planning permission on the

basis of the extent of the layout. It is, no doubt,

premised on the land being in excess of a certain

threshold becoming subject matter of the planning

permission. The land so reserved is to be freed from

any construction by the owner/promoter/developer. The

land for communal and recreational purposes, is to be

restricted at ground level in a shape and location to

be specified by the CMDA (See Clause (3) of the

Explanation in Rules.). Therefore, the exact land to

be reserved under the impugned Rule, will vary from

case to case. It is not to be confused with the areas

required, reserved or designated in the plan. In fact,

in Annexure XX, which is the subject matter of the 2008

Regulations, the specific requirement in regard to the

place where the OSR is to be located is indicated as

the place where the property abuts a public road.

59. From the Preamble to the DCR, it would appear that

the first master plan was prepared in 1975 for the

Chennai Metropolitan Area and the Government approved

it on 04.12.1976. As found by V. Ramasubramanium, J.

in the Judgment, which we have elaborately referred to,

the DCR came to be issued along with the first master

plan. Thereafter, as noticed by him, to deal with group

100

development or flats, the issue was taken up by the

CMDA by letter dated 22.03.1981, Government issued GoMS

dated 08.10.1982. The learned Judge has found that the

Government exercised power under Section 32 of the Act.

What we are indicating is that the reservation of the

land for communal or recreational purposes in

individual cases, on the basis of applications made by

persons, is not to be conflated with the land which is

declared as required, reserved or designated in the

master plan, inter alia, which latter categories alone

are the subject matter of Sections 36 and 37 of the

Act.

IS THE IMPUGNED RULE/REGULATION BAD FOR

THE REASON THAT IT IS CONTRARY TO THE

MANDATE OF SECTION 39 OF THE ACT?

60. Section 39 of the Act, reads as follows:

“39. Right to compensation. - (1) Any person

whose property is injuriously affected by

virtue of any of the provisions contained in

any regional plan, master plan, detailed

development plan or a new town development plan

made under this Act shall, if he prefers a

claim for the purpose to the Tribunal with such

particulars and within such period as may be

prescribed, be entitled to obtain compensation

101

in respect thereof as determined by the

Tribunal:

Provided that property shall not be deemed to

be injuriously affected by reason of any of the

provisions inserted in any development plan

which impose any condition or restriction in

regard to any of the matters specified in

clause (f) of sub-section (2) of section 15,

or in clauses (k) and (l) of sub-section (2)

of section 17 or in clauses (m) and (n) of subsection (1) of section 20, as the case may be.

(2) If, at any time after the day on which any

regional plan, master plan, detailed

development plan, or a new town development

plan has come into force, such plan is varied,

or revoked, any person who has incurred any

expenditure for the purpose of complying with

such plan, shall, if he prefers a claim for

the purpose to the Tribunal with such

particulars and within such time as may be

prescribed, be entitled to obtain compensation

in respect thereof as determined by the

Tribunal, if by reason only of the variation

or revocation of such plan, such expenditure

has ceased to be in any way beneficial to him.”

61. What Section 39 contemplates is the following:

A person must be injuriously affected on account

of any of the provisions contained in a regional plan,

master plan, detailed development plan or a new town

development plan, under the Act. Should this occur, the

affected party becomes entitled to move the Tribunal

and seek compensation, which is to be determined by the

102

Tribunal. The proviso to Section 39(1), however,

declares that property shall not be deemed to be

injuriously affected on account of any development

plan, which may impose certain conditions, which are

specified in Section 15(2)(f), Section 17(2)(k) and (l)

or in Section 20(1)(m) and (n).

62. ‘Development plan’ is defined in Section 2(15) as

follows:

“(15) “development plan” means a plan for the

development or re-development or improvement

of the area within the jurisdiction of a

planning authority and includes a regional

plan, master plan, detailed development plan

and a new town development plan prepared under

the Act.”

63. Therefore, a development plan would embrace a

master plan. The effect of the proviso is that, in

respect of the matters contained in the proviso, the

law declares that there would not be a claim for

compensation on the basis that the property of a person

is injuriously affected as a result of the contents of

the development plan in relation to matters specified

in the proviso. The word ‘injuriously affected’ would

103

apparently mean that a person has land, which is

adversely affected as a result of the coming into

operation of the development plan. Section 15(2)(f)

deals with demarcation of objects and buildings of

archaeological or historical interests or of natural

beauty or actually used for religious purposes or as

regarded by the public with veneration. Similarly,

Section 17(2)(k) deals with control of architectural

features, elevation and frontage of buildings and

structures. Section 17(2)(l), which is also referred

to in the proviso, deals with matters relating to zonal

regulations, location, the height, the number of

storeys, size of buildings and other structures, the

size of the yards and other open spaces and the use of

buildings, structures and land. If anyone is otherwise

injuriously affected as a result of any of these

aspects provided for in a master plan under Section 17,

he cannot make a complaint of it under Section 39 and

claim compensation for it. The master plan provides for

zones, nine in number. One of the zones is open space

zone. Open space requirements are separately stipulated

in respect of other zones. Similarly, Section 20, which

104

deals with the contents of the detailed development

plan, in sub-Section (1)(m), deals essentially with

buildings of archaeological and historical interests,

inter alia. Section 20(1)(n) of the Act reads as

follows:

“20(1)(n) the imposition of conditions and

restrictions in regard to the character,

density, architectural features and height of

buildings, the building or control lines for

roads, railway lines and power supply lines and

the purposes to which buildings or specified

areas may or may not be appropriated and the

provision and maintenance of sufficient open

spaces about buildings;”

64. A perusal of Section 39 would clearly reveal that

a right to compensation is conferred on any person

whose property is ‘injuriously affected’ by any of the

provisions contained in the master plan. A person

seeking to develop his land and if he falls within the

ambit of rule/regulation in question cannot be

described as a person whose property is injuriously

affected by the provisions of the master plan inter

alia. The very language used in Section 39 appears to

be incongruous with the raising of any such claim. It

is not as if the parties have in this case raised any

105

such claim. The contention taken in the case of M/s.

Keyaram Hotels is that Section 39 provides for

compensation to persons who are affected in the manner

provided in the said provision. The provision actually

deals with cases of a person having property, who, with

the making of a master plan, inter alia, becomes

injuriously affected. The words ‘injuriously affected’

would bear meaning if expounded with reference to a

person who has a property and that property becomes

injuriously affected by virtue of the provision of any

master plan. Take for instance, the land of a person

is found to fall in a zone which is earmarked in the

primary residential use zone. The provision in the DCR

which forms part of the plan inter alia provides that

all uses not specifically permitted under sub-rule (a)

and (b) will stand prohibited in the zone. The proviso

is only to be understood as qualifying the ambit of the

main provision which itself must be understood has

application in cases where a person is injuriously

affected by the provision of a master plan inter alia.

65. We are reinforced in our view that the contention

of the appellants is misplaced with reference to the

106

concept of ‘injuriously affected’ finding expression

in Section 39, having regard to the decision by this

Court in Prakash Amichand Shah v. State of Gujarat34.

This was also a case relating to town planning. It

arose under the Bombay Town Planning Act. We may only

refer to paragraph 10 which reads as follows:

“10. Section 69 states that the owner of any

property or right which is injuriously affected

by the making of a town planning scheme shall

be entitled to obtain compensation from the

local authority or from any person benefited

or partly from the local authority and partly

from such person as the Town Planning Officer

may in each case determine. It seems obvious

that the property or right which is injuriously

affected by the making of a town planning

scheme is a property or right other than that

acquired for the purposes of the scheme. The

property or right affected remains with the

owner who is entitled to compensation for such

injurious affection. When under the Act a plot

of land is taken for the purposes of a town

planning scheme, it cannot be suggested that

that land itself is injuriously affected; such

a view is unsupportable both as a matter of

language and having regard to the scheme of the

Act. On behalf of the appellant it was urged

that clause (xiii) would cover the case of the

appellant if only we read a few words in that

clause and that we should do so to avoid

injustice being done to the appellant and the

owners of land similarly situated. That we are

afraid is not possible. We find no compelling

reason for restructuring the clause, and taking

acquisition of land to mean “injurious

34 (1981) 3 SCC 508

107

affection” of the land acquired would be

inconsistent with the entire scheme of the Act.

We may refer to clause “fourthly” of Section

23(1) of the Land Acquisition Act, 1894 which

requires the court to take into consideration

in determining the amount of compensation to

be awarded for land acquired under that Act,

the damage sustained by the “person interested”

“by reason of the acquisition injuriously

affecting his other property”. The expression

“person interested” as defined in Section 3 of

the Land Acquisition Act means all persons

calming an interest in compensation to be made

on account of the acquisition of land under

that Act. It is made clear in clause “fourthly”

that the damage is for injurious affection of

some property other than the land acquired. The

sense in which the expression “injurious

affection” is used in Section 23(1) of the Land

Acquisition Act is the generally accepted

meaning of that expression and we find nothing

in the Act concerned in this case that suggests

that it should be construed differently.”

66. The case of a person developing land being

subjected to the requirement of leaving 10 percent of

the property in a situation where more than nearly 2

and a half acres is being developed in an urban

metropolis as space for communal and recreational

purposes cannot be said to be a person ‘injuriously

affected’ within the meaning of Section 39.

108

THE IMPACT OF SECTIONS 48 TO 55

67. The contention is taken that Sections 48 and 49 do

not authorise or enable deprivation of a person’s

property sought to be developed free of cost. Equally,

it is contended that Sections 52 to 54 obligate the

state to acquire lands even if permission for

development is rejected or if any of the conditions for

any permission is objected or even if any modifications

of already given permission is not acceptable to the

owner. It is also contended that Sections 52 to 54

patently provide for compensation. Therefore, the

impugned rule which provides for a compelled gift

involving transfer of right to property free of cost

is ultra vires. It is the further contention that the

legislature took extraordinary care to ensure that a

landowner is not affected or injured even slightly

because of the planning law. The exceptions from

obligation to pay compensation are provided in Sections

17(2)(k) and (l) which relate to the use of land and

do not provide for reserving any land for public

purpose.

109

68. Section 47 of the Act comes under Chapter VI which

deals with control of development and use of land. It

declares that after the coming into operation of any

development plan in any area, any person, other than

the government or local authority, cannot use or cause

to be used any land otherwise in accordance with the

development plan. This would mean that once a

development plan which includes a master plan comes

into operation which happens on the approval of the

government being published under Section 30 of the Act

in the Gazette, Development activities must be carried

on only in accordance with the terms of the master

plan. Section 48 is intended to place restrictions on

buildings and land when a notice in the Gazette is

published under Section 26, inter alia. With the

publication of the notice which is a prelude to the

coming into operation of the plan under Section 30,

Section 48 prohibits the erection of any building or

other work or other excavation as enumerated therein

except with a written permission of the planning

authority and subject to such conditions. Section 49

provides for application for such permission when

110

notice of preparation of a master plan, inter alia, is

published under Section 26 of the Act inviting the

restrictions contemplated in Section 48. It is dealing

with such a situation, namely, when the master plan,

inter alia, has not come into operation and only a

notice is published under Section 26, inter alia, that

Section 49(2) provides for three matters which are to

guide the planning authority in deciding whether

permission should be granted or not. They are as

follows: -

i. The purpose.

ii. The suitability of the place for such purpose.

iii. The future development and maintenance of the

planning area.

69. Section 50 provides that the permission granted

under Section 49 is to remain in force for a period of

three years from the date of permission. It can be

extended but subject to a maximum period of three

years. Section 52 provides for an obligation to acquire

land or building. It operates in the following

circumstances. A land may be required or reserved or

designated in any development plan which includes

111

master plan. A person must be interested in the land

or building which is so required, reserved or

designated in such plan. He must have made an

application seeking permission. The application must

have been either refused or granted, subject to

conditions. For the section to operate the following

further conditions must exist. The refusal to grant

permission should result in the land or building

becoming incapable of reasonably beneficial use in the

condition in which the land is. This means that as a

result of the land or building being required, reserved

or designated in the plan, the person interested in the

land or building is unable to use the land for which

he could have used, but for the requirement,

reservation or designation in the plan, and it has

resulted in the rejection of his application for

permission to develop the property. Then the law has

given the person so aggrieved to serve a notice

described as the ‘acquisition notice’ calling upon the

government to acquire his interest in the land or

building. The same would be the position if permission

is granted but subject to the conditions which render

112

the land incapable of beneficial use. Section 53 deals

with refusal of permission or grant of permission

subject to conditions in certain other cases. In fact,

the proviso in Section 53 declares that no compensation

can be claimed under the main provision if the refusal

or grant of permission subject to conditions is based

on any provision of any development plan. Section 54

deals with cases of permission which is granted for any

development under the Act being revoked or modified.

Section 54(2) contemplates compensation for the

expenditure which is incurred for carrying out the

development based on the grant of permission which was

rendered abortive by the revocation. Section 55

declares that nothing in the Act confers any right to

obtain compensation in respect of development made by

a person after a notice in the Gazette is published

under Section 26, inter alia, without obtaining the

permission as required under Section 49. Sub-section 2

of Section 55 reads as follows: -

“(2). Whether any property is alleged to be

injuriously affected by reason of any of the

provisions contained in any development plan,

no compensation shall be paid in respect

thereof, if or in so far as the provisions are

113

such as would have been enforceable without any

compensation under any law, rule or regulation

or bye-law at the time in force.”

70. We are unable to find merit in the contention that

Rule 19 of the DCR or the regulation which is impugned

is in anyway ultra vires of the provision of the Act

and the arguments suggestive of the same are repelled.

71. Even though the appellant’s (M/s. Keyaram Hotels

Pvt. Ltd.) attempt to invite us to pronounce on the

validity of the impugned rule on the score that it

contravened the provisions of the Tamil Nadu Apartment

Ownership Act, 1994 which got presidential assent on

06.04.1995 and came to be notified on 24.04.1995, we

do not think that the appellant should be permitted to

test the validity of the impugned rule on a ground

which was not raised before the High Court. It is true

that the gift deed was executed on 22.05.1996. But this

was not a ground which was urged before the court and

we do not intend to explore the contention in this

proceeding.

114

72. We have found that the impugned rule/ regulation

cannot be said to be ultra vires the parent act. This

is after finding that the rule has statutory force.

THE RIGHTS REGIME

73. It is necessary to deal with a right, a person has,

as an owner of a property. In Salmond on Jurisprudence

12th Edition, we note the following:

“Secondly, the owner normally has a right to

use and enjoy the thing owned: right to manage

it, i.e., the right to decide how it shall be

used; and the right to the income from it.

Whereas the right to possess is a right in the

strict sense, these rights are in fact

liberties: the owner has a liberty to use the

thing, i.e., he is under no duty not to use

it, in contrast with others who are under a

duty not to use or interfere with it.”

74. We may however notice the following:

“This does not mean, however, that an owner

whose property is unencumbered has completely

unlimited rights. To describe someone as an

absolute owner of property is to say two

things; it is to assert that his title to the

property is indisputable, and that he has all

the rights of ownership allowed by the legal

system in question. We have seen that the

rights of ownership may be limited by the

adverse dominant rights of an encumbrancer or

by the rights of the possessor (who is in fact

one very special type of an encumbrancer). They

115

may also be limited by special provisions of

law such as Town & Country planning law, which

regulates for social purposes the use which an

owner may make office land. But in addition to

being restricted by such specific provisions

of public law, and owner’s rights are

restricted by a whole variety of provisions of

the ordinary law, according to which various

harmful and dangerous types of conduct qualify

as criminal or tortious; the fact that I am

the owner of a knife will not entitle me to

use it to kill Smith. We may say that an owner

is free to use and dispose of his property as

he pleases, except in so far as he does not

infringe his duties to specific encumbrancers,

his duties under special regulations

concerning the use of property (f) and his

general duties under the general law of the

land (f).”

(Emphasis supplied)

75. In T. Vijayalakshmi v. Town Planning Member,

35 this

Court while dealing with a case arising under the Town

Planning Law had this to say:

“13. Town Planning legislations are regulatory

in nature. The right to property of a person

would include a right to construct a building.

Such a right, however, can be restricted by

reason of a legislation.

15. The law in this behalf is explicit. Right

of a person to construct residential houses in

the residential area is a valuable right. The

said right can only be regulated in terms of a

regulatory statute but unless there exists a

clear provision the same cannot be taken away.

35 (2006) 8 SCC 502

116

It is also a trite law that the building plans

are required to be dealt with in terms of the

existing law. Determination of such a question

cannot be postponed far less taken away.

Doctrine of legitimate expectation in a case

of this nature would have a role to play.”

(Emphasis supplied)

76. In Indore Vikas Pradhikaran v. Pure Industrial Coke

& Chemicals Ltd.,

36 this Court was again dealing with a

case under the town Planning Law. The following

statement requires to be noticed:

“45. Town and country planning involving land

development of the cities which are sought to

be achieved through the process of land use,

zoning plan and regulating building activities

must receive due attention of all concerned.

We are furthermore not oblivious of the fact

that such planning involving highly complex

cities depends upon scientific research, study

and experience and, thus, deserves due

reverence.

46. Where, however, a scheme comes into force,

although it may cause hardship to the

individual owners as they may be prevented from

making the most profitable use of their rights

over property, having regard to the drastic

consequences envisaged thereunder, the statute

should be considered in such a manner as a

result whereof greater hardship is not caused

to the citizens than actually contemplated

thereby. Whereas an attempt should be made to

prevent unplanned and haphazard development

but the same would not mean that the court

36 (2007) 8 SCC 705

117

would close its eyes to the blatant

illegalities committed by the State and/or the

statutory authorities in implementation

thereof. Implementation of such land

development as also building laws should be in

consonance with public welfare and

convenience. In United States of America zoning

ordinances are enacted pursuant to the police

power delegated by the State. Although in India

the source of such power is not police power

but if a zoning classification imposes

unreasonable restrictions, it cannot be

sustained. The public authority may have

general considerations, safety or general

welfare in mind, but the same would become

irrelevant, as thereby statutory rights of a

party cannot be taken away. The courts must

make an endeavour to strike a balance between

public interest on the one hand and protection

of a constitutional right to hold property, on

the other.

47. For the aforementioned purpose, an

endeavour should be made to find out as to

whether the statute takes care of public

interest in the matter vis-à-vis the private

interest, on the one hand, and the effect of

lapse and/or positive inaction on the part of

the State and other planning authorities, on

the other.

52. The courts should, therefore, strive to

find a balance of the competing interests.

Human rights issue

53. The right to property is now considered to

be not only a constitutional right but also a

human right.

Interpretation of the Act

57. The Act being regulatory in nature as by

reason thereof the right of an owner of

118

property to use and develop stands restricted,

requires strict construction. An owner of land

ordinarily would be entitled to use or develop

the same for any purpose unless there exists

certain regulation in a statute or statutory

rules. Regulations contained in such statute

must be interpreted in such a manner so as to

least interfere with the right to property of

the owner of such land. Restrictions are made

in larger public interest. Such restrictions,

indisputably must be reasonable ones.

(See Balram Kumawat v. Union of India [(2003)

7 SCC 628] ; Krishi Utpadan Mandi

Samiti v. Pilibhit Pantnagar Beej Ltd. [(2004)

1 SCC 391] and Union of India v. West Coast

Paper Mills Ltd. [(2004) 2 SCC 747] ) The

statutory scheme contemplates that a person and

owner of land should not ordinarily be deprived

from the user thereof by way of reservation or

designation.

58. Expropriatory legislation, as is wellknown, must be given a strict construction.

(Emphasis supplied)

77. An owner of land may not have an absolute and

unqualified right which is the idea which not

unnaturally comes to mind when the idea of ownership

is under consideration. As we have already noted, the

right is capable of being regulated and restricted

under a law relating to Town Planning. Proceeding on

the basis that DCR is law, the question would arise

under the said law whether a person can use his land

as he chooses. Zoning requirements have been put in

119

place. Primarily in a residential zone, can anyone put

up an industrial establishment if the said use is

prohibited? The answer is quite clearly in the

negative. Can anyone construct a building in excess of

the stipulated requirement as to the height of the

building or contravening restrictions such as setback,

floor space area etc.? The answer cannot be in the

affirmative.

78. At this juncture, we may also notice the scheme of

the Constitution as regards property rights. When

Constitution was originally enacted the right to

acquire, hold and dispose of property was guaranteed

as a fundamental right to citizens of India vide

Article 19(1)(f). This was, however, made subject to

reasonable restrictions which could no doubt be imposed

by a law under Article 19(5). That apart, Article 31

originally provided as follows:

“31. (1) No person shall be deprived of his

property save by authority of law.

(2) No property, movable or immovable,

including any interest in, or in any company

owning, any commercial of industrial

undertaking shall be taken possession of or

acquired for public purposes under any law

authorising the taking of such possession or

such acquisition, unless the law provides for

120

compensation for the property taken possession

of or acquired and either fixes the amount of

the compensation, or specifies the principles

on which, and the manner in which, the

compensation is to be determined and given.

(3) No such law as is referred to in clause

(2) made by the legislature of a State shall

have effect unless such law, having been

reserved for the consideration of the

President, has received his assent.

(4) If any Bill pending at the commencement of

this Constitution in the legislature of a State

has, after it has, been passed by such

Legislature, been reserved for the

consideration of the President and has received

his assent, then, notwithstanding anything in

this Constitution, the law so assented to shall

not be called in question in any court on the

ground that it contravenes the provisions of

clause (2).

(5) Nothing in clause (2) shall affect—

(a) the provisions of any existing law other

than a law to which the provisions of clause

(6) apply, or

(b) the provisions of any law which the State

may hereafter make—

(i) for the purpose of imposing or levying any

tax or penalty, or

(ii) for the promotion of public health or the

prevention of danger to life or property, or

(iii) in pursuance of any agreement entered

into between the Government of the Dominion of

India or the Government of India and the

Government of any other country, or otherwise,

with respect to property declared by law to be

evacuee property.

(6) Any law of the State enacted not more than

eighteen months before the commencement of this

Constitution may within three months from such

commencement be submitted to the President for

his certification; and thereupon, if the

President by public notification so certifies,

121

it shall not be called in question in any court

on the ground that it contravenes the

provisions of clause (2) of this article or has

contravened the provisions of sub-section (2)

of Section 209 of the Government of India Act,

1935.”

79. This Article 31 came to be amended by Constitution

(Fourth Amendment) Act and after the amendment, the

amended provision read as follows:

The Constitution (Fourth Amendment) Act

amended clause (2) and inserted a new clause

(2-A). The amended clause (2) and the new

clause (2-A) are in these terms:

“31. (2) No property shall be compulsorily

acquired or requisitioned save for a public

purpose and save by authority of a law which

provides for compensation for the property so

acquired or requisitioned and either fixes the

amount of the compensation or specifies the

principles on which, and the manner in which,

the compensation is to be determined and given;

and no such law shall be called in question in

any court on the ground that the compensation

provided by that law is not adequate.

(2-A). Where a law does not provide for the

transfer of the ownership or right to

possession of any property to the State or to

a corporation owned or controlled by the State,

it shall not be deemed to provide for the

compulsory acquisition or requisitioning of

property, notwithstanding that it deprives any

person of his property.”

122

80. At this juncture again, we must notice the aspect

of Police power, in contrast with the Doctrine of

Eminent Domain.

81. In the judgment of this court in Deputy

Commissioner and Collector v. Durga Nath Sarma37, this

Court has noticed the amendment of Article 31 as

noticed hereinbefore and has expounded the law in the

following paragraph:

“10. Our attention has been drawn to certain

opinions expressed in our earlier decisions that

Article 31(2) occupies the field of eminent

domain and Article 31(5)(b)(ii) contains a

saving clause with regard to the police powers

of the State. The concepts of eminent domain and

police powers are borrowed from American law.

The constitutional guarantee of the due process

clause in the United States Constitution

requires that no private property shall be taken

for public use without just compensation. In the

exercise of its police power, the State may pass

regulations designed to ensure public health,

public morals, public safety as also public

convenience or general prosperity, see Chicago,

Burlington & Quincy Railway company v. People of

the State of Illinois [200 US 561 : 50 LEd 596,

609] . In the exercise of its eminent domain

power, the State may take any property from the

owner and may appropriate it for public

purposes. The police and eminent domain powers

are essentially distinct. Under the police power

many restrictions may be imposed and the

property may even be destroyed without

compensation being given, whereas under the

37 AIR 1968 SC 394

123

power of eminent domain, the property may be

appropriated to public use on payment of

compensation only. The distinction between the

two powers is brought out clearly in the

following passage in American Jurisprudence, 2nd

Edn., Vol. 16, Article 301 p. 592:

“The state, under the police power, cannot

in any manner actually take and appropriate

property for public use without compensation,

for such action is repugnant to the

constitutional guaranty that where private

property is appropriated for public use, the

owner shall receive reasonable compensation.

Thus, there is a vital difference, which is

recognised by the authorities, between an Act

passed with exclusive reference to the police

power of the state, without any purpose to take

and apply property to public uses, and an Act

which not only declares the existence of a

nuisance created by the condition of particular

property, but in addition, and as the best

means of accomplishing the end in view,

authorizes the same property to be appropriated

by the public.”

In Sweet v. Rechel [159 US 380 : 40 LEd 188]

the validity of an Act to enable the city of

Boston to abate a nuisance existing therein

and for the preservation of the public health

in the city by improving the drainage of the

territory was sustained on the ground that

the Act provided for payment of just

compensation. The Court pointed out that

private property the condition of which was

such as to endanger the public health could

not be legally taken by the Commonwealth and

appropriated to public use without reasonable

compensation to the owner. In Delaware L. &

W.R. Co. v. Morristown [276 US 182 : 72 LEd

523, 527] an Ordinance establishing a public

hack stand on private property without

payment of compensation was struck down on

the ground that assuming that the creation

of the public hack stand would be a proper

124

exercise of the police power it did not

follow that the due process clause would not

safeguard to the owner just compensation for

the use of the property. In United

States v. Caltex (Philippines) [344 US 149 :

97 LEd 157] the Court held that no

compensation was payable by the United States

for the destruction by its retreating army

of private property to prevent its falling

into enemy hands. But the Court recognised

that compensation would be payable for the

army's requisitioning of private property for

its subsequent use. The Court said that in

times of imminent peril such as when fire

threatened a whole community — the sovereign

could, with immunity, destroy the property

of a few that the property of many and the

lives of many more could be saved. Indeed,

it would be folly not to destroy some

building so that an entire town may be saved

from the conflagration, as will appear from

the following historic incident referred to

in Respublica v. Sparhawk [1 Dall 357, 363 :

1 LEd 174] :

“We find, indeed, a memorable instance of

folly recorded in the 3rd Vol. of Clarendon's

History, where it is mentioned, that the Lord

Mayor of London in 1666, when the city was

on fire, would not give directions for, or

consent to, the pulling down forty wooden

houses or to removing the furniture etc.

belonging to the lawyers of the temple, then

on the circuit, for fear he should be

answerable for a trespass; and in consequence

of this conduct, half that great city was

burnt.”

If Article 31(5)(b)(ii) is regarded as a saving

clause with regard to the police power of the

State, it is clear that under a law designed

to promote public health or to prevent danger

to life or property the State may in cases of

imminent peril destroy or impair the value of

private property without any obligation to pay

125

compensation, but it cannot arrogate to itself

the power to acquire and appropriate to its own

use private property without payment of

compensation.

82. We may also notice that in Tukaram Kana Joshi v.

MIDC38, while dealing with a case of acquisition of

land, this Court held as follows:

“11. …The appellants had asked repeatedly for

grant of the benefit of compensation. The State

must either comply with the procedure laid down

for acquisition, or requisition, or any other

permissible statutory mode. There is a

distinction, a true and concrete distinction,

between the principle of “eminent domain” and

“police power” of the State. Under certain

circumstances, the police power of the State

may be used temporarily, to take possession of

property but the present case clearly shows

that neither of the said powers have been

exercised. A question then arises with respect

to the authority or power under which the State

entered upon the land. It is evident that the

act of the State amounts to encroachment, in

exercise of “absolute power” which in common

parlance is also called abuse of power or use

of muscle power. To further clarify this

position, it must be noted that the authorities

have treated the landowner as a “subject” of

medieval India, but not as a “citizen” under

our Constitution.”

83. It has been followed in Bhimandas Ambwani (Dead)

through LRs v. Delhi Power Company Ltd.

39.

38 (2013) 1 SCC 353

39 (2013) 14 SCC 195

126

84. While on the issue relating to the aspect of

acquisition, a case arose under the Coffee Act in

Coffee Board, Karnataka, Bangalore v. Commissioner of

Commercial Taxes, Karnataka and others40 and the

question which arose was whether the coffee grower who

made a sale made compulsorily to the Coffee Board

amounted to sale or was it an acquisition. It is

apposite that we advert to the following paragraphs:

“28. Since all persons including the Coffee

Board are prohibited from purchasing/selling

coffee in law, there could be no sale or

purchase to attract the imposition of

sales/purchase tax it was urged. Even if there

was compulsion there would be a sale as was

the position in Vishnu Agencies [(1978) 2 SCR

433 : (1978) 1 SCC 520 : 1978 SCC (Tax) 31 :

AIR 1978 SC 449] . This Court therein approved

the minority opinion of Hidayatullah, J. in New

India Sugar Mills v. CST [New India Sugar

Mills Ltd. v. CST, AIR 1963 SC 1207 : 1963 Supp

(2) SCR 459 : (1963) 14 STC 316] . In the nature

of the transactions contemplated under the Act

mutual assent either express or implied is not

totally absent in this case in the transactions

under the Act. Coffee growers have a volition

or option, though minimal or nominal to enter

into the coffee growing trade. Coffee growing

was not compulsory. If anyone decides to grow

coffee or continue to grow coffee, he must

transact in terms of the regulation imposed for

40 (1988) 3 SCC 263,

127

the benefit of the coffee growing industry.

Section 25 of the Act provides the Board with

the right to reject coffee if it is not up to

the standard. Value to be paid as contemplated

by the Act is the price of the coffee. Fixation

of price is regulation but is a matter of

dealing between the parties. There is no time

fixed for delivery of coffee either to the

Board or the curer. These indicate

consensuality which is not totally absent in

the transaction.”

It was found that it was a sale which took place.

85. Article 31 stands omitted and Article 19(1)(f) also

stands deleted by way of the Forty-Fourth Amendment to

the Constitution which came into effect from

20.06.1979. It is by the very same amendment that

Article 300A was inserted in the Constitution. Article

300A is a resurrection of Article 31 (1). This Court

in the judgment in Jilubhai Nanbhai Khachar v. State

of Gujarat41 held as follows:

“34. The right of eminent domain is the right

of the sovereign State, through its regular

agencies, to reassert, either temporarily or

permanently, its dominion over any portion of

the soil of the State including private

property without its owner's consent on account

of public exigency and for the public good.

Eminent domain is the highest and most exact

41 1995 (suppl.) 1 SCC 596

128

idea of property remaining in the Government,

or in the aggregate body of the people in their

sovereign capacity. It gives the right to

resume possession of the property in the manner

directed by the Constitution and the laws of

the State, whenever the public interest

requires it. The term ‘expropriation’ is

practically synonymous with the term “eminent

domain”.

(Emphasis supplied)

This Court opined that the right to property is not

a basic feature of the Constitution [See paragraph 30].

We may also notice the following views: -

“48. The word ‘property’ used in Article 300-

A must be understood in the context in which

the sovereign power of eminent domain is

exercised by the State and property

expropriated. No abstract principles could be

laid. Each case must be considered in the light

of its own facts and setting. The phrase

“deprivation of the property of a person” must

equally be considered in the fact situation of

a case. Deprivation connotes different

concepts. Article 300-A gets attracted to an

acquisition or taking possession of private

property, by necessary implication for public

purpose, in accordance with the law made by

Parliament or a State Legislature, a rule or a

statutory order having force of law. It is

inherent in every sovereign State by exercising

its power of eminent domain to expropriate

private property without owner's consent.

Prima facie, State would be the judge to decide

whether a purpose is a public purpose. But it

is not the sole judge. This will be subject to

judicial review and it is the duty of the court

to determine whether a particular purpose is a

129

public purpose or not. Public interest has

always been considered to be an essential

ingredient of public purpose. But every public

purpose does not fall under Article 300-A nor

every exercise of eminent domain an acquisition

or taking possession under Article 300-A.

Generally speaking preservation of public

health or prevention of damage to life and

property are considered to be public purposes.

Yet deprivation of property for any such

purpose would not amount to acquisition or

possession taken under Article 300-A. It would

be by exercise of the police power of the

State. In other words, Article 300-A only

limits the powers of the State that no person

shall be deprived of his property save by

authority of law. There has to be no

deprivation without any sanction of law.

Deprivation by any other mode is not

acquisition or taking possession under Article

300-A. In other words, if there is no law,

there is no deprivation. Acquisition of mines,

minerals and quarries is deprivation under

Article 300-A.”

(Emphasis supplied)

86. A Constitution Bench has considered the aspects

arising out of the changes brought by the amendment to

the Constitution by the insertion of Article 300A in

the judgment of this Court in K.T. Plantation Private

Limited v. State of Karnataka42. We may advert to the

following views:

“178. The principles of eminent domain, as

such, are not seen incorporated in Article 300-

42 (2011) 9 SCC 1

130

A, as we see, in Article 30(1-A), as well as

in the second proviso to Article 31-A(1) though

we can infer those principles in Article 300-

A. The provision for payment of compensation

has been specifically incorporated in Article

30(1-A) as well as in the second proviso to

Article 31-A(1) for achieving specific

objectives. The Constitution (Forty-fourth

Amendment) Act, 1978 while omitting Article 31

brought in a substantive provision clause (1-

A) to Article 30. Resultantly, though no

individual or even educational institution

belonging to majority community shall have any

fundamental right to compensation in case of

compulsory acquisition of his property by the

State, an educational institution belonging to

a minority community shall have such

fundamental right to claim compensation in case

the State enacts a law providing for compulsory

acquisition of any property of an educational

institution established and administered by a

minority community. Further, the second

proviso to Article 31-A(1) prohibits the

legislature from making a law which does not

contain a provision for payment of compensation

at a rate not less than the market value which

follows that a law which does not contain such

provision shall be invalid and the acquisition

proceedings would be rendered void.

179. Looking at the history of the various

constitutional amendments, judicial

pronouncements and the Statement of Objects and

Reasons contained in the Forty-fourth

Amendment Bill which led to the Forty-fourth

Amendment Act we have no doubt that the

intention of Parliament was to do away with the

fundamental right to acquire, hold and dispose

of the property. But the question is whether

the principles of eminent domain are completely

obliterated when a person is deprived of his

property by the authority of law under Article

300-A of the Constitution.

131

Public purpose

180. Deprivation of property within the

meaning of Article 300-A, generally speaking,

must take place for public purpose or public

interest. The concept of eminent domain which

applies when a person is deprived of his

property postulates that the purpose must be

primarily public and not primarily of private

interest and merely incidentally beneficial to

the public. Any law, which deprives a person

of his private property for private interest,

will be unlawful and unfair and undermines the

rule of law and can be subjected to judicial

review. But the question as to whether the

purpose is primarily public or private, has to

be decided by the legislature, which of course

should be made known.

Compensation

182. We have found that the requirement of

public purpose is invariably the rule for

depriving a person of his property, violation

of which is amenable to judicial review. Let

us now examine whether the requirement of

payment of compensation is the rule after the

deletion of Article 31(2).

183. Payment of compensation amount is a

constitutional requirement under Article 30(1-

A) and under the second proviso to Article 31-

A(1), unlike Article 300-A. After the Fortyfourth Amendment Act, 1978, the constitutional

obligation to pay compensation to a person who

is deprived of his property primarily depends

upon the terms of the statute and the

legislative policy. Article 300-A, however,

does not prohibit the payment of just

compensation when a person is deprived of his

property, but the question is whether a person

is entitled to get compensation, as a matter

of right, in the absence of any stipulation in

the statute, depriving him of his property.

132

188. We find no apparent conflict with the

words used in List III Entry 42 so as to infer

that the payment of compensation is inbuilt or

inherent either in the words “acquisition and

requisitioning” under List III Entry 42. Right

to claim compensation, therefore, cannot be

read into the legislative List III Entry 42.

189. Requirement of public purpose, for

deprivation of a person of his property under

Article 300-A, is a precondition, but no

compensation or nil compensation or its

illusiveness has to be justified by the State

on judicially justiciable standards. Measures

designed to achieve greater social justice, may

call for lesser compensation and such a

limitation by itself will not make legislation

invalid or unconstitutional or confiscatory.

In other words, the right to claim compensation

or the obligation to pay, though not expressly

included in Article 300-A, it can be inferred

in that article and it is for the State to

justify its stand on justifiable grounds which

may depend upon the legislative policy, object

and purpose of the statute and host of other

factors.

190. Article 300-A would be equally violated

if the provisions of law authorising

deprivation of property have not been complied

with. While enacting Article 300-A Parliament

has only borrowed Article 31(1) (the “Rule of

Law” doctrine) and not Article 31(2) (which had

embodied the doctrine of eminent domain).

Article 300-A enables the State to put

restrictions on the right to property by law.

That law has to be reasonable. It must comply

with other provisions of the Constitution. The

limitation or restriction should not be

arbitrary or excessive or what is beyond what

is required in public interest. The limitation

133

or restriction must not be disproportionate to

the situation or excessive.

191. The legislation providing for deprivation

of property under Article 300-A must be “just,

fair and reasonable” as understood in terms of

Articles 14, 19(1)(g), 26(b), 301, etc. Thus

in each case, courts will have to examine the

scheme of the impugned Act, its object, purpose

as also the question whether payment of nil

compensation or nominal compensation would

make the impugned law unjust, unfair or

unreasonable in terms of other provisions of

the Constitution as indicated above.

192. At this stage, we may clarify that there

is a difference between “no” compensation and

“nil” compensation. A law seeking to acquire

private property for public purpose cannot say

that “no compensation shall be paid”. However,

there could be a law awarding “nil”

compensation in cases where the State

undertakes to discharge the liabilities

charged on the property under acquisition and

onus is on the Government to establish validity

of such law. In the latter case, the Court in

exercise of judicial review will test such a

law keeping in mind the above parameters.

209. Statutes are many which though deprive a

person of his property, have the protection of

Article 30(1-A), Articles 31-A, 31-B, 31-C and

hence are immune from challenge under Article

19 or Article 14. On deletion of Article

19(1)(f) the available grounds of challenge are

Article 14 [Ed.: It would seem that for

statutes not protected by Arts. 31-A, 31-B or

31-C, Art. 14 simpliciter is available as a

ground of challenge. For statutes protected by

Arts. 31-A, 31-B and 31-C, it would seem that

a challenge under Art. 14 would be maintainable

only when taken as a part of the basic

structure of the Constitution, as explained

134

in I.R. Coelho, (2007) 2 SCC 1.] , the basic

structure and the rule of law, apart from the

ground of legislative competence. In I.R.

Coelho case [(2007) 2 SCC 1] the basic

structure was defined in terms of fundamental

rights as reflected under Articles 14, 15, 19,

20, 21 and 32. In that case the Court held that

statutes mentioned in Schedule IX are immune

from challenge on the ground of violation of

fundamental rights, but if such laws violate

the basic structure, they no longer enjoy the

immunity offered by Schedule IX.”

(Emphasis supplied)

DOWN MEMORY LANE

PT. CHET RAM VASHIST (DEAD) BY LRS. V. MUNICIPAL

CORPORATION OF DELHI43

87. In the said case, the Municipal Corporation of

Delhi passed a Resolution that, building activity in

certain areas, be allowed, subject to the condition

that the open spaces for parks and schools was to be

transferred to the Corporation. This led to a civil

suit by the appellant, challenging the Resolution. This

Court found that Section 313 of the Delhi Municipal

Corporation Act, 1957, did not empower the Corporation

to claim any property in the manner done. It was further

43 (1995) 1 SCC 47

135

found that the Resolution was contrary to the language

used in Section 313 and violated a civil right, which

vests in every owner, to hold his land and transfer it

in accordance with law. The finding of the High Court

that condition was only one involving transfer of the

right of management, was not accepted. In fact, this

Court also held, inter alia, as follows:

“5. The power directing transfer of the land

has been exercised under Section 313 of the

Act. This section falls in Chapter XV which

deals with streets. The public streets are

dealt from Section 298 to Section 311 whereas

private streets are dealt from Section 312 to

Section 330. Section 312 obliges an owner of

any land utilising, selling, leasing out or

otherwise disposing of the land for the

construction of building to layout and make a

street or streets giving access to the plots

into which the land may be divided and connect

it with an existing or public street. Section

313 requires such owner to submit a layout plan

before utilising the land for any of the

purposes mentioned in Section 312 and send it

to the Commissioner with a layout plan showing

the particulars mentioned in clauses (a) to

(e). The reservation or allotment of any site

in the layout plan for any open space, park or

school is to be provided by clause (b) of

Section 313. Section 316 entitles the

Commissioner to declare a private street to be

a public street on the request of owners.

Section 317 prohibits a person from

constructing or projecting any structure which

will encroach upon, overhang or project into a

private street. In fact the entire cluster of

sections from 312 to 330 of which Section 313

136

is a part, deals with private streets only.

There is no provision in this chapter or any

other provision in the Act which provides that

any space reserved for any open space or park

shall vest in the Corporation. Even a private

street can be declared to be a public on the

request of owners of the building and then only

it vests in the Corporation. In absence of any

provision, therefore, in the Act the open space

left for school or park in a private colony

cannot vest in the Corporation. That is why in

England whenever a private colony is developed

or a private person leaves an open space or

park to be used for public purpose he is

required to issue what is termed as ‘Blight

Notice’ to the local body to get the land

transferred in its favour on payment of

compensation. Section 313 which empowers the

Commissioner to sanction a layout plan, does

not contemplate vesting of the land earmarked

for a public purpose to vest in the Corporation

or to be transferred to it. The requirement in

law of requiring an owner to reserve any site

for any street, open space, park, recreation

ground, school, market or any other public

purposes is not the same as to claim that the

open space or park so earmarked shall vest in

the Corporation or stand transferred to it.

Even a plain reading of sub-section (5)

indicates that the land which is subject-matter

of a layout plan cannot be dealt with by the

owner except in conformity with the order of

the Standing Committee. In other words the

section imposes a bar on exercise of power by

the owner in respect of land covered by the

layout plan. But it does not create any right

or interest of the Corporation in the land so

specified. The resolution of the Standing

Committee, therefore, that the area specified

in the layout plan for the park and school

shall vest in the Corporation free of cost, was

not in accordance with law.”

(Emphasis supplied)

137

88. Still further, the Court held as follows:

“6. Reserving any site for any street, open

space, park, school etc. in a layout plan is

normally a public purpose as it is inherent in

such reservation that it shall be used by the

public in general. The effect of such

reservation is that the owner ceases to be a

legal owner of the land in dispute and he holds

the land for the benefit of the society or the

public in general. It may result in creating

an obligation in nature of trust and may

preclude the owner from transferring or selling

his interest in it. It may be true as held by

the High Court that the interest which is left

in the owner is a residuary interest which may

be nothing more than a right to hold this land

in trust for the specific purpose specified by

the coloniser in the sanctioned layout plan.

But the question is, does it entitle the

Corporation to claim that the land so specified

should be transferred to the authority free of

cost. That is not made out from any provision

in the Act or on any principle of law. …”

(Emphasis supplied)

T. VIJAYALAKSHMI AND OTHERS V. TOWN

PLANNING MEMBER AND ANOTHER44

89. In this case, the appellants were the owners of

agricultural land, who had been permitted to use the

same for non-agricultural purposes in 2004. An

44 (2006) 8 SCC 502

138

application was filed for approval of a building plan.

This Court, inter alia, held as follows:

“15. The law in this behalf is explicit. Right

of a person to construct residential houses in

the residential area is a valuable right. The

said right can only be regulated in terms of a

regulatory statute but unless there exists a

clear provision the same cannot be taken away.

It is also a trite law that the building plans

are required to be dealt with in terms of the

existing law. Determination of such a question

cannot be postponed far less taken away.

Doctrine of legitimate expectation in a case

of this nature would have a role to play.

xxx xxx xxx

18. It is, thus, now well-settled law that an

application for grant of permission for

construction of a building is required to be

decided in accordance with law applicable on

the day on which such permission is granted.

However, a statutory authority must exercise

its jurisdiction within a reasonable time.

(See Kuldeep Singh v. Govt. of NCT of

Delhi [(2006) 5 SCC 702: (2006) 6 Scale 588].)”

PUNE MUNICIPAL CORPORATION AND

ANOTHER V. PROMOTERS AND BUILDERS

ASSOCIATION AND ANOTHER45

90. The matter arose under the Maharashtra Regional

Town Planning Act, 1966 (MRTP). The Development Control

Rules were directed to be amended by the Government

45 (2004) 10 SCC 796

139

under Section 37 of the said law. The case of the

respondents before this Court was that the matter

travelled beyond the powers of the State Government

under Section 37(2) of the Act. We notice the

following:

“5. Making of DCR or amendments thereof are

legislative functions. Therefore, Section 37

has to be viewed as repository of legislative

powers for effecting amendments to DCR. That

legislative power of amending DCR is delegated

to the State Government. As we have already

pointed out, the true interpretation of Section

37(2) permits the State Government to make

necessary modifications or put conditions

while granting sanction. In Section 37(2), the

legislature has not intended to provide for a

public hearing before according sanction. The

procedure for making such amendment is provided

in Section 37. Delegated legislation cannot be

questioned for violating the principles of

natural justice in its making except when the

statute itself provides for that requirement.

Where the legislature has not chosen to provide

for any notice or hearing, no one can insist

upon it and it is not permissible to read

natural justice into such legislative

activity. Moreover, a provision for “such

inquiry as it may consider necessary” by a

subordinate legislating body is generally an

enabling provision to facilitate the

subordinate legislating body to obtain

relevant information from any source and it is

not intended to vest any right in anybody.

(Union of India v. Cynamide India Ltd. [(1987)

2 SCC 720] , SCC paras 5 and 27. See

generally H.S.S.K. Niyami v. Union of

India [(1990) 4 SCC 516] and Canara

Bank v. Debasis Das [(2003) 4 SCC 557 : 2003

140

SCC (L&S) 507] .) While exercising legislative

functions, unless unreasonableness or

arbitrariness is pointed out, it is not open

for the Court to interfere. (See

generally ONGC v. Assn. of Natural Gas

Consuming Industries of Gujarat [1990 Supp SCC

397] .) Therefore, the view adopted by the High

Court does not appear to be correct.

6. DCR are framed under Section 158 of the Act.

Rules framed under the provisions of a statute

form part of the statute. (See General Officer

Commanding-in-Chief v. Dr. Subhash Chandra

Yadav [(1988) 2 SCC 351 : 1988 SCC (L&S) 542 :

(1988) 7 ATC 296] , SCC para 14.) In other

words, DCR have statutory force. It is also a

settled position of law that there could be no

“promissory estoppel” against a statute. (A.P.

Pollution Control Board II v. Prof. M.V.

Nayudu [(2001) 2 SCC 62] , SCC para

69, STO v. Shree Durga Oil Mills [(1998) 1 SCC

572] , SCC paras 21 and 22 and Sharma

Transport v. Govt. of A.P. [(2002) 2 SCC 188]

, SCC paras 13 to 24.) Therefore, the High

Court again went wrong by invoking the

principle of “promissory estoppel” to allow the

petition filed by the respondents herein.”

TUKARAM KANA JOSHI AND OTHERS V.

MAHARASHTRA INDUSTRIAL DEVELOPMENT

CORPORATION AND OTHERS46

91. In the said case, the land of the appellants was

taken over by the agents of the State. Compensation,

46 (2013) 1 SCC 353

141

despite repeated requests, was not made available. This

Court held:

“11. There are authorities which state that

delay and laches extinguish the right to put

forth a claim. Most of these authorities

pertain to service jurisprudence, grant of

compensation for a wrong done to them decades

ago, recovery of statutory dues, claim for

educational facilities and other categories of

similar cases, etc. Though, it is true that

there are a few authorities that lay down that

delay and laches debar a citizen from seeking

remedy, even if his fundamental right has been

violated, under Article 32 or 226 of the

Constitution, the case at hand deals with a

different scenario altogether. The

functionaries of the State took over possession

of the land belonging to the appellants without

any sanction of law. The appellants had asked

repeatedly for grant of the benefit of

compensation. The State must either comply with

the procedure laid down for acquisition, or

requisition, or any other permissible

statutory mode. There is a distinction, a true

and concrete distinction, between the

principle of “eminent domain” and “police

power” of the State. Under certain

circumstances, the police power of the State

may be used temporarily, to take possession of

property but the present case clearly shows

that neither of the said powers have been

exercised. A question then arises with respect

to the authority or power under which the State

entered upon the land. It is evident that the

act of the State amounts to encroachment, in

exercise of “absolute power” which in common

parlance is also called abuse of power or use

of muscle power. To further clarify this

position, it must be noted that the authorities

have treated the landowner as a “subject” of

142

medieval India, but not as a “citizen” under

our Constitution.”

92. This has been followed in Bhimandas Ambwani (Dead)

Through Lrs. v. Delhi Power Company Limited47 (See

paragraph 13 of the said Judgment).

JILUBHAI NANBHAI KHACHAR AND OTHERS V.

STATE OF GUJARAT AND ANOTHER48

93. We have already adverted to it earlier.

STATE OF GUJARAT V. SHANTILAL MANGALDAS

AND OTHERS49

94. The said decision was rendered by a Constitution

Bench of this Court. The matter in issue was the

validity of Sections 55 and 67 of the Bombay Town

Planning Act (Act 27 of 1955). The High Court had

declared the provisions violative of Article 31(2) of

the Constitution. This Court embarked upon elaborate

consideration of the provisions of the Act, and it will

be profitable, if we advert to paragraph-22, wherein,

the Court, after referring to the provisions of Article

47 (2013) 14 SCC 195

48 1995 Supp (1) SCC 596

49 (1969) 1 SCC 509

143

31, as amended by the Fourth Amendment in the year

1955, proceeded to hold as follows:

“22. The following principles emerge from an

analysis of clauses (2) and (2-A): compulsory

acquisition or requisition may be made for a

public purpose alone, and must be made by

authority of law. Law which deprives a person

of property but does not transfer ownership of

the property or right to possession of the

property to the State or a corporation owned

or controlled by the State is not a law for

compulsory acquisition or requisition. The

law, under the authority of which property is

compulsorily acquired or requisitioned, must

either fix the amount of compensation or

specify the principles on which, and the manner

in which, the compensation is to be determined

and given. If these conditions are fulfilled

the validity of the law cannot be questioned

on the plea that it does not provide adequate

compensation to the owner.

xxx xxx xxx

26. Article 31 guarantees that the law

providing for compulsory acquisition must

provide for determining the giving of

compensation for the property acquired. The

expression “compensation” is not defined in the

Constitution. Under the Land Acquisition Act

compensation is always paid in terms of money.

But that is no reason for holding that

compensation which is guaranteed by Article

31(2) for compulsory acquisition must be paid

in terms of money alone. A law which provides

for making satisfaction to an expropriated

owner by allotment of other property may be

deemed to be a law providing for compensation.

In ordinary parlance the expression

“compensation” means anything given to make

things equivalent; a thing given to or to make

144

amends for loss, recompense, remuneration or

pay; it need not therefore necessarily be in

terms of money. The phraseology of the

Constitutional provision also indicates that

compensation need not necessarily be in terms

of money, because it expressly provides that

the law may specify the principles on which,

and the manner in which, compensation is to be

determined and “given”. If it were to be in

terms of money alone, the expression “paid”

would have been more appropriate.”

95. In the course of its Judgment, the Court

disapproved observations contained in P. Vajravelu

Mudaliar v. Special Deputy Collector for Land

Acquisition and another50. Equally, the Court overruled

the decision of this Court in Union of India v. Metal

Corporation of India Ltd. and another51.

96. It was relying on these two judgments, inter alia,

that this Court found that the High Court had wrongly

concluded that in order that compensation based on

market value be sufficient for the purpose of Article

31(2), it must be a just equivalent. We may also notice

that the Court repelled the attempt on behalf of the

State that because the object of the Act was to promote

50 (1965) 1 SCR 614

51 (1967) 1 SCR 255)

145

public health, it fell within the exception to Article

31(5)(b)(ii).

97. Regarding purport of the Fourth Amendment, in

Shantilal Mangaldas (supra), this Court declared as

follows:

“41. The principal effect of this amendment,

in so far as that is relevant in this appeal,

was to snap the link which, according to this

Court, existed between clauses (1) and (2) —

that was achieved by enacting clause (2-A);

greater clarity was secured by enacting in

clause (2) that property shall be compulsorily

acquired only for a public purpose; and by

authority of law which provides for

compensation, and either fixes the amount of

compensation or specifies the principles on

which, and the manner in which, compensation

is to be determined and given; and that the

law for acquisition or requisition shall not

be called in question in any court on the

ground that the compensation provided thereby

is not adequate. By the amendment made in

Article 31-A certain classes of statutes were

placed with retrospective effect outside the

purview of attack before the Courts on the

ground of infringement of the fundamental

rights under Articles 14, 19 and 31, and by

the addition of certain Acts in the Ninth

Schedule a challenge to those Acts that they

infringed any fundamental rights in Part III

could not be entertained. But the amendments

made in Article 31 were not given any

retrospective operation. The result was that

in cases where acquisition was made pursuant

to the statutes enacted before April 27, 1955,

the law declared in Mrs Bela Banerjee

146

case and Subodh Gopal Base case continued to

apply.”

98. The Judgment in Shantilal Mangaldas (supra) has

been approved of and followed in the case by a

Constitution Bench in Prakash Amichand Shah v. State

of Gujarat and others52.

99. The Court repelled the argument that the decision

in Shantilal Mangaldas (supra) was overruled by the

Judgment in His Holiness Kesavananda Bharati

Sripadagalvaru v. State of Kerala and another53.

100. This Court also made the following observations,

which incidentally are relied upon by the respondents

to contend that the developer of property would be

entitled to benefits when there is planned development:

“16. The re-arrangement of titles in the

various plots and reservation of lands for

public purposes require financial adjustments

to be made. The owner who is deprived of his

land has to be compensated, and the owner who

obtains a re-constituted plot in surroundings

which are conducive to better sanitary living

conditions has to contribute towards the

expenses of the scheme. This is because on the

making of a Town Planning Scheme the value of

the plot rises and a part of the benefit which

arises out of a unearned rise in prices is

52 (1986) 1 SCC 581

53 (1973) 4 SCC 225

147

directed to be contributed towards financing

of the scheme which enables the residents in

that area to more amenities, better facilities

and healthier living conditions. …”

101. This Court in Babulal Badriprasad Varma v. Surat

Municipal Corporation and others54, while dealing with

the Gujarat Town Planning and Urban Development Act,

1976, inter alia, held:

“33. We are, however, not unmindful of the fact

that a statute of town planning ex facie is

not a statute for acquisition of a property.

An owner of a plot is asked to part therewith

only for providing for better facilities of

which he would also be a beneficiary. Every

step taken by the State does not involve

application of the doctrine of eminent domain.

34. In this case, the appellant did not oppose

the draft scheme. It accepted that the State

had a right to do so. Existence of a public

purpose and increase in the valuation of the

property was admitted. There exists a

distinction in the action of the planning

authority as regards vesting of a property in

it and one so as to enable it to create a thirdparty interest vis-à-vis for the purpose of

reallotment thereof. In the former case, the

vesting of the land may be held to be an act

of acquisition, whereas in the latter, it would

be distribution of certain benefits having

regard to the purpose sought to be achieved by

a statute involving town planning. It was on

that legal principle, this Court in State of

Gujarat v. Shantilal Mangaldas [(1969) 1 SCC

54 (2008) 12 SCC 401

148

509 : (1969) 3 SCR 341] opined that when a

development is made, the owner of the property

gets much more than what he would have got, if

the same remained undeveloped in the process

as by reason thereof he gets the benefit of

living in a developed town having good town

planning.”

(Emphasis supplied)

102. In the recent Judgment, again, a Bench of three

learned Judges of this Court, followed the Judgment in

Chairman, Indore Vikas Pradhikaran (supra).

NARAYANRAO JAGOBAJI GOWANDE PUBLIC

TRUST V. STATE OF MAHARASHTRA AND OTHERS55

103. The dispute revolved around a condition in a

development agreement executed between the appellantTrust and the Nagpur Improvement Trust (for short,

‘NIT’). Under such condition, the appellant was to

transfer the land and/or primary school open land in

the layout free-of-cost and the NIT was free to dispose

of such land as per its Rules and Regulations. We notice

that the predecessor-in-interest of the appellant was

given permission by the NIT, under which, an area was

55 (2016) 4 SCC 443

149

reserved for a primary school which was a public

utility land. The NIT allotted the land in the layout

approved in favour of the appellant’s predecessor to a

third party for construction of a college. Several

contentions were arrayed against the allotment,

including that the NIT did not have any power to insert

such a condition and that there was no power to acquire

land de hors the Act, under which, it was created. This

Court dismissed the appeal and upheld the view of the

High Court. In doing so, this Court held as follows:

“34. We have carefully heard both the parties

at length and have also given our conscious

thought to the materials on record and the

relevant provisions of law. We are of the view

that the High Court in its judgment and order

has rightly held that Respondent 1 State and

Respondent 2 NIT are bound to stick to the

development plan and scheme. It has placed

reliance upon the decision of this Court

in Indore Vikas Pradhikaran v. Pure Industrial

Coke & Chemicals Ltd. [Indore Vikas

Pradhikaran v. Pure Industrial Coke &

Chemicals Ltd., (2007) 8 SCC 705] , wherein

this Court, while dealing with the aspect of

town planning and Articles 300-A and 14 of the

Constitution of India, has observed as under:

(SCC p. 730, paras 46-47)

“46. … The courts must make an endeavour to

strike a balance between public interest on the

one hand and protection of a constitutional

right to hold property, on the other.

150

47. For the aforementioned purpose, an

endeavour should be made to find out as to

whether the statute takes care of public

interest in the matter vis-à-vis the private

interest, on the one hand, and the effect of

lapse and/or positive inaction on the part of

the State and other planning authorities, on

the other.”

xxx xxx xxx

36. The High Court has, further, rightly held

that the impugned clause contained in the said

development agreement is neither void nor

illegal for want of consideration. It has also

been rightly held by it that after

consideration of the whole scheme of the NIT

Act, particularly, the provisions under

Sections 29 to 70 and 121 of the said Act read

with the terms and conditions of the said

development agreement entered into between the

parties, it is clear that the said development

agreement creates reciprocal rights and

obligations between the parties with some

objects.

xxx xxx xxx

38. Thus, seeking abandonment of acquisition

of the land as provided under Section 68 of

the NIT Act is a huge benefit which the

appellant Trust has gained from the agreement.

Further, it is not open for the appellant Trust

to avail only the beneficial part of the said

development agreement to form a layout plan and

allow the sites to be allotted in favour of

the allottees, when it itself is not willing

to discharge the obligation of transferring the

reserved land for public utility purpose, as

agreed upon in the development agreement.

39. Further, the High Court has rightly

observed that another benefit derived by the

appellant Trust from the said development

151

agreement is immediate and reciprocal sanction

for the development of the said land with

permission for the commercial usage of the

same, presuming that there would be no

acquisition.”

YOGENDRA PAL AND OTHERS V. MUNICIPALITY,

BATHINDA AND ANOTHER56

104. The case arose under the Punjab Municipal Act,

1911. The State Government, acting under Section 192(3)

of the Municipal Law, sanctioned a Town Planning

Scheme, under which, an area of 22.23 acres was

transferred to the Municipal Committee. No compensation

was paid to the owners. The High Court upheld the

provision. Section 192(1)(c), inter alia, provided for

transfer, to the Committee, of land, either on payment

of compensation or otherwise. The contention taken by

the respondent was that it was only a transfer of land

and not acquisition. This Court found that the

provision did contain a restriction on the maximum

amount of land which could be transferred and also

maximum amount of land which could be transferred

without payment of compensation. This Court found that

56 (1994) 5 SCC 709

152

there was no guideline in the Act providing for as to

when compensation was payable or could be denied. The

Court also took note of the width of the expression

‘public purpose’, for achieving which, the land could

be transferred. It was further noticed that the said

expression suggested that the purpose concerned cannot

be of benefit only and exclusively to the transferorlandowner. It was to be a utility to members of the

public in general. The fact that the transferorlandowner would also benefit, did not make any

difference. The use of the word ‘transferred’ as

against ‘acquired’ and the contention that, ‘therefore,

the rights of the land owner continued’, was rejected.

Section 192(c) was contrasted with Section 169 and it

was found that the latter provision was confined to use

of the land for laying public streets, and what is

more, the land could be acquired by paying

compensation. Section 169 also contemplated

restoration to the original owner, if the land could

not be used as a public street. We may bear in mind the

following discussions in the context of the facts of

the case before us:

153

“18. The next contention is that the transfer

of the land is also for the benefit of the

transferor landowner and in fact the balance

of the land which remains with him appreciates

in value to an extent which more than

sufficiently compensates him for the loss of

the land. Hence there is no need to pay him

separate compensation for the extent of land

up to 25 per cent transferred to the Municipal

Committee. The contention suffers from several

fallacies. In the first instance, as the

provisions of the section themselves point out,

the land is to be transferred for a public

purpose including for use as public street. The

purpose of the transfer itself suggests that

the transferor landowner is not exclusively to

be benefited by the public purpose. He enjoys

the benefit, if any, along with the other

members of the public. There is no reason why,

therefore, he should alone pay for the said

benefit in terms of his land. Secondly, the

public purpose which is served by the Municipal

Committee, assuming it increases the value of

the remaining land, also contributes to the

increase in the value of the land of all other

landowners, which lands are similarly

benefited by the said public purpose. There is,

therefore, no reason why the landowner whose

land is “transferred” for the purpose alone

should pay for the increase in the value of

his remaining land in terms of the transferred

land. In fact, whereas it is only the remaining

land of the transferor landowner which is

benefited by such increase in value, if any,

the whole of the land in the possession of the

other landowners is benefited by the accretion

in value. Thus, on both accounts, there is a

clear violation of Article 14 of the

Constitution to make only the transferor

landowner suffer for the public purpose. What

is further, it is problematic and is in the

realm of speculation as to whether the

appreciation of the value of the remaining

property of the transferor landowner will

154

always be equivalent to or more than the value

of the land transferred to the Municipal

Committee, assuming that the public purpose for

which the land is taken over contributes to the

increase in the value of the remaining

property. Lastly, and this is equally

important, in many cases the accretion to the

value of the remaining property may merely be

on paper and be a poor consolation to the

transferor landowner if he cannot or is unable

for one reason or the other to sell or

otherwise dispose of the said property. On the

other hand, in such cases, the accretion in

value may prove a burden if the property tax,

wealth tax, estate duty etc. are calculated on

the basis of the market value of the property.

The so-called increase in the value of the

property may thus prove a liability to those

who cannot dispose of their property. Looked

at from any angle, the argument that the

transferor landowner is benefited because his

remaining property appreciates in value and,

therefore, he need not be paid separate

compensation for the land which is transferred,

is untenable in law. We thus find that the

provisions of Section 192(1)(c) are violative

of Article 14 of the Constitution.”

VIRENDER GAUR AND OTHERS V. STATE OF

HARYANA AND OTHERS57

105. In the said case, the appellant surrendered 25 per

cent of her land to the Municipality, which was a

condition for sanction for construction of a building.

The land stood vested with the Municipality. The land

57 (1995) 2 SCC 577

155

in question stood earmarked for open spaces. A

Dharamshala came to be put-up for the Punjab Samaj

Sabha on the basis of allotment to it. It was contended

that in the construction of the Dharamshala, even if

there was a public purpose, the Government could not

direct the Municipality to permit land use, defeating

the scheme, which provided for keeping the land open.

This Court described environment ‘as a polycentric and

multifaceted problem, affecting human existence’.

106. The Court, in Virender Gaur (supra), further found

power to the Municipality under Section 66 to transfer

the land vested in it. The Court went on to hold, inter

alia, as follows:

“11. It is seen that the open lands, vested in

the Municipality, were meant for the public

amenity to the residents of the locality to

maintain ecology, sanitation, recreation,

playground and ventilation purposes. The

buildings directed to be constructed

necessarily affect the health and the

environment adversely, sanitation and other

effects on the residents in the locality.

Therefore, the order passed by the Government

and the action taken pursuant thereto by the

Municipality would clearly defeat the purpose

of the scheme. Shri D.V. Sehgal, learned Senior

Counsel, again contended that two decades have

passed by and that, therefore, the Municipality

is entitled to use the land for any purpose.

156

We are unable to accept the self-destructive

argument to put a premium on inaction. The land

having been taken from the citizens for a

public purpose, the Municipality is required

to use the land for the protection or

preservation of hygienic conditions of the

local residents in particular and the people

in general and not for any other purpose.

Equally acceptance of the argument of Shri V.C.

Mahajan encourages pre-emptive action and

conduct, deliberately chartered out to

frustrate the proceedings and to make the

result fait accompli. We are unable to accept

the argument of fait accompli on the touchstone

of prospective operation of our order.”

107. This Court also distinguished Yogendra Pal (supra)

in this regard.

108. There is a contention of the appellants and the

writ petitioners that, at any rate, the law is an

expropriatory legislation. This is for the reason that

it operates to deprive a person of his land without his

consent. [See in this regard Chairman, Indore Vikas

Pradhikaran (supra), which has discussed this aspect

elaborately.] For reasons already given and to follow,

we are unable to agree.

109. We agree that the law, undoubtedly, is that the

planning law cannot be interpreted as justifying an

inroad into the rights of a private person to construct

157

a suitable building for the purpose of carrying on his

business.

110. In Ravindra Ramchandra Waghmare v. Indore

Municipal Corporation and others58, after an elaborate

reference to Chairman, Indore Vikas Pradhikaran (supra)

and K.T. Plantations (supra), this Court, inter alia,

held as follows:

“76. …It is apparent from the aforesaid dictum

that Article 300-A enables the State to put

restrictions on the right by law but the same

should not be arbitrary or excessive or beyond

what is required in public interest. The

imposition of restriction must not be

disproportionate to a situation or statute.

Legislation providing for deprivation of

property under Article 300-A must be just, fair

and reasonable. Thus, it cannot be said that

illusory compensation is provided under

Section 306 read with Section 387. The decision

renders no help to the cause espoused on behalf

of the appellants and on a closer scrutiny,

rather counters it. Based on the aforesaid

principles we find no malady in the provisions

in question which may be required to be cured.”

111. No doubt, the Court, in the said case also, after

referring to Rajiv Sarin and another v. State of

Uttarakhand others59, found that the case at hand was

58 (2017) 1 SCC 667

59 (2011) 8 SCC 708

158

not a case of no compensation. Incidentally, this Court

also followed the Judgment in Shantilal Mangaldas

(supra):

“83. As already held a law seeking to acquire

private property for public purpose cannot say

that “no compensation” would be paid. The

present case is a case of payment of “no

compensation” at all. In the case at hand, the

forest land which was vested in the State by

operation of law cannot be said to be nonproductive or unproductive by any stretch of

imagination. The property in question was

definitely a productive asset. That being so,

the criteria to determine possible income on

the date of vesting would be to ascertain such

compensation paid to similarly situated owners

of neighbouring forests on the date of vesting.

Even otherwise, the Revenue Authority can

always make an estimation of possible income

on the date of vesting if the property in

question had been exploited by the appellants

and then calculate compensation on the basis

thereof in terms of Sections 18(1)(cc) and

19(1)(b) of the KUZALR Act.”

112. In Rajiv Sarin (supra), the U.P. Zamindari

Abolition and Land Reforms Act, 1950, the Kumaun and

Uttarakhand Abolition and Land Reforms Act, 1960,

introduced the U.P. Act in the Uttarakhand and Kumaun

region. The rights of every intermediary in respect of

forest land came to be vested with the State

Government. This was as a result of an amendment. The

159

amendment and Notice came to be challenged. This Court,

speaking through a Constitution Bench, held, inter

alia, as follows:

“68. The incident of deprivation of property

within the meaning of Article 300-A of the

Constitution normally occurred mostly in the

context of public purpose. Clearly, any law,

which deprives a person of his private property

for private interest, will be amenable to

judicial review. In the last sixty years,

though the concept of public purpose has been

given quite wide interpretation, nevertheless,

the “public purpose” remains the most important

condition in order to invoke Article 300-A of

the Constitution.

69. With regard to claiming compensation, all

modern Constitutions which are invariably of

democratic character provide for payment of

compensation as the condition to exercise the

right of expropriation. The Commonwealth of

Australia Constitution Act, the French Civil

Code (Article 545), the Fifth Amendment to the

Constitution of USA and the Italian

Constitution provided principles of “just

terms”, “just indemnity”, “just compensation”

as reimbursement for the property taken, have

been provided for.

70. Under the Indian Constitution, the field

of legislation covering claim for compensation

on deprivation of one's property can be traced

to Schedule VII List III Entry 42 of the

Constitution. The Constitution (Seventh

Amendment) Act, 1956 deleted Schedule VII List

I Entry 33, List II Entry 36 and reworded List

III Entry 42 relating to “acquisition and

requisitioning of property”. The right to

property being no more a fundamental right, a

160

legislation enacted under the authority of law

as provided in Article 300-A of the

Constitution is not amenable to judicial review

merely for alleged violation of Part III of the

Constitution.

xxx xxx xxx

73. It was further submitted that the inherent

powers of public purpose and eminent domain are

embodied in Article 300-A, and Entry 42, List

III, “acquisition and requisitioning of

property” which necessarily connotes that the

acquisition and requisitioning of property

will be for a public use and for compensation

and whenever a person is deprived of his

property, the limitations as implied in Article

300-A as well as Entry 42, List III will come

into the picture and the Court can always

examine the legality and validity of the

legislation in question. It was further

submitted that awarding nil compensation is

squarely amenable to judicial review under

Articles 32 and 226 of the Constitution of

India.

xxx xxx xxx

77. Article 31(2) of the Constitution has since

been repealed by the Constitution (Fortyfourth Amendment) Act, 1978. It is to be noted

that Article 300-A was inserted by the

Constitution (Forty-fourth Amendment) Act,

1978 by practically re-inserting Article 31(1)

of the Constitution. Therefore, right to

property is no longer a fundamental right but

a right envisaged and conferred by the

Constitution and that also by retaining only

Article 31(1) of the Constitution and

specifically deleting Article 31(2), as it

stood. In view of the aforesaid position the

entire concept of right to property has to be

viewed with a different mindset than the

mindset which was prevalent during the period

when the concept of eminent domain was the

161

embodied provision of fundamental rights. But

even now as provided under Article 300-A of the

Constitution the State can proceed to acquire

land for specified use but by enacting a law

through State Legislature or by Parliament and

in the manner having force of law.”

113. The Court also reiterated the distinction between

‘no compensation’ and ‘Nil compensation’, as laid down

in K.T. Plantations (supra). The Court proceeded to

find that it was a case of ‘no compensation’ at all,

and therefore, it attracted the vice of illegal

deprivation of property and gave relief on the said

basis. This is after finding that the property in

question was a productive asset.

114. In W.P. No. 591/15, the challenge is to Regulation

29(7)(a) and Annexure XX. It is first necessary to

notice the scheme of Regulation 29(7).

“29(7) (a) The space set apart for roads

(except those which may remain private) and the

10% area reserved for recreational purposes

shall be transferred to the Authority or Agency

or the Local Body designated by the Authority

free of cost through a registered gift deed

before the actual approval of the layout under

the provisions of the T & CP Act. The exact

mode of conveyance should be consistent with

the relevant enactment and regulations.

(b) In cases of industrial estates developed

by Government agencies the Authority reserves

162

the right to allow them to retain the spaces

set apart for roads and the recreational spaces

as parks/play grounds and maintain them for the

purposes to the satisfaction of the Authority.

space for recessed bus stops as part of the

road space in the layouts exceeding 2 hectares,

where found necessary on public interest and

this part of the road space also be transferred

free of cost as stated in the sub rule 7(a)

above.”

115. Regulation 29(3)(b) deals with the width of the

streets and roads within the layout. It inter alia

provides for the width and the streets of the roads and

passages. Thereunder, in the remarks column, it is

provided that starting with the minimum width of 7.2

meters in regard to streets intended to serve not more

than 16 plots / or subject to a maximum length of 120

meters, all the streets become public. The common

refrain found in the remarks column is that that all

such streets shall become public. We must next

specifically advert to Regulation 29(6):

“29(6) Reservation of land for recreational

purposes in a layout or sub’ division for

residential, commercial, industrial or

combination of such uses shall be as follows.

Extent of layout Reservation

163

(1) (2)

For the first 3000

square metres

Nil

Between 3000 10 per cent of the area

excluding toads or in

the alternative he

shall

pay the market value of

equivalent land and

excluding the first

square metres 3000

square metres as per

the valuation of the

registration

and 10,000 department.

"No such area reserved

shall measures less

than 100

square metres square

metres with a minimum

dimension of 10

metres."

Above 10,000 square

metres

10 per cent of the area

excluding roads. It is

obligatory to make the

reservation and no

equivalent land cost in

lieu· of the same is

acceptable.

(a) The land for community recreational purposes

shall be restricted to ground level, in a shape

and location to be specified by the Chennai

Metropolitan Development Authority. The land so

reserved shall be free from any ·construction by

the layout owner, developer or promoter

(b) The building and use of land shall conform

to the conditions that may be imposed while

sanctioning the layout. The space set apart for

164

commercial, institutional, industrial or other

uses shall be deemed to be zoned for commercial,

institutional; industrial or corresponding uses

under the Master Plan.”

116. We may notice at this juncture that there is no

challenge to Regulation 29(6). The second most

important aspect we notice is that the land for

community recreational purposes shall be restricted to

the ground level in a shape and location to be specified

by the CMDA. Further the land reserved is to be free

from any construction by the layout owner, developer

and promoter. Further the use of the land shall conform

to the conditions that may be imposed while sanctioning

the layout.

117. Before we pass on to the impugned regulation,

namely, Regulation 29 (7) (a), we must also undoubtedly

notice Annexure XX which is also under challenge.

“ANNEXURE XX

Reservation of land for community recreational

purposes in case of special buildings/ Group

Developments/ multi-storeyed building

developments

(1) The reservation of land for community

recreational purposes such as park / playground

shall be as given below at gr9und level in a

shape and location 'abutting a public road to be

165

specified by Chennai Metropolitan Development

Authority:

Extent of site Reservation

(a) For the first

3,000 square

metres

Nil

(b) Between 3,000

square metres and

10,000 square

metres

10% of the area

excluding roads or in

the alternative he

shall pay the market

value of the

equivalent land

excluding the first

3000 sq.m. as per the

valuation of the

Registration

Department, only where

it is not possible to

provide open space due

to ·physical

constraints. No such

area reserved shall

measure less than 100

square metres with a

minimum dimension of

10 metres.

The space so reserved

shall be transferred

to the Authority or to

the Local body

designated by it, free

of cost, through a

registered gift deed.

In cases of

residential

developments, the

Authority or the local

body concerned may

permit the Residents

Association or Flat

Owner's Association

for maintaining such

reserved space as park

166

/ playground and in

such cases where the

Authority decides to

permit the Resident's

Association or Flat

Owner's Association

for maintaining it,

direct access from a

public road for the

reserved area may not

be required, and right

of access to the

Authority or the local

body concerned through

set back space shall

be transferred through

a registered gift deed

along with the

reserved space.

square metres

Ten per cent of the

area excluding road

shall be reserved and

this space shall be

transferred to the

Authority or to the

local body designated

by it, free of cost,

through a gift deed.

It is obligatory to

reserve the 10 per

cent of the site area

and no charge can be

accepted in lieu iri

case of the new

developments or

redevelopments.

(2) The site so reserved shall be exclusive of

'the setback spaces and. spacing between blocks

prescribed in these rules, and shall· be free

from any construction / structure.

167

(3) For the purpose of this regulation, existing

development is defined as one where the extent

of ground area covered by structures already

existing (prior to application for planning

permission) is 25 per cent and above of the total

site area.

(4) In case of additions to existing

developments, where it is difficult to leave the

10 per cent area as open space for community

recreational purposes, the Authority reserves

the right to collect the market value of

equivalent land in lieu of the land to be

reserved. However, if on a future date, the

applicant wants to demolish the existing

structure and raise new structures on the site

in question, the community recreational space as

per the rule shall be reserved.

(5) The Authority reserves· the right to enforce

the maintenance of such reserved lands by the

owner to the satisfaction of the Authority or

order the owner to transfer the land to the

Authority or any local body designated by it free

of cost, through a registered gift deed. The

Authority or the local body designated by it, as

the case may be, reserves the right to decide on

entrusting the maintenance work to any

institution / individual on the merits of the

case.”

118. It will be noticed on a perusal of Annexure XX that

the reservation for community recreation purposes such

as park, playground is to be at ground level in a shape

and location abutting a public road to be specified by

the CDMA. Thereafter, the requirement relating to

executing the gift deed in respect of layout in excess

168

of 10000 square meters is laid down. It is after this

that we must notice Regulation 29 (7)(a).

“29(7)(a) The space set apart for. roads

(except those which may remain private) and the

10% area reserved for recreational purposes

shall be transferred to the Authority or Agency

or the Local Body designated by the Authority

free of cost through a registered gift deed

before the actual approval of the layout under

the provisions of the T & CP Act. The exact

mode of conveyance should be consistent with

the relevant enactment and regulations.”

119. From the additional affidavit which we have already

noticed, the challenge is limited by the petitioner to

the stipulation in Regulation 29(7)(a) so far as the

requirement of transferring the space set apart for

recreational purposes. In other words, the petitioners

accept the validity of Regulation 29(7)(a) otherwise.

Rule 29 reads as follows: -

“29. Layout and sub-division regulations:

This regulation seeks to ensure access to plots

by 'way of roads and private passages, creating

hierarchy of roads depending on the road length

and intensity of

developments in the area and also to provide

adequate linkages to the existing roads and

proposed roads in the Master Plan and Detailed

Development Plan and further to provide proper

circulation pattern in the area, providing

required recreational spaces such as parks /

169

playgrounds, and providing spaces for common

amenities such as schools, post and telegraph

offices, fire stations, police stations etc.

(1) The minimum extent of plots and frontage

shall be as prescribed for various uses and

types of developments given in the DR Nos.

25,26,27 and 28.

(2) (a) The minimum width of the public

streets/road on which the site abuts or gains

access shall be 7.2m. for residential layout

developments and 9m. for industrial layout

developments. For subdivisions the minimum

width of the passage /public streets/road on

which the site abuts or gains access shall be

as required for different uses and types of

developments.

(b) The minimum width stated above shall be the

existing width of the road and not the street

alignment prescribed.

For residential development

“29(3) The width of the streets/roads and

passages in the layouts. /subdivisions /

amalgamations shall conform to the minimum

requirements given below:

(a) for Residential developments

Description

(1)

Minimum

Width

(2)

Remarks

(3)

A. Passage '

(i) In areas of

Economically

Weaker

Section and· for

continuous

building area:

1.0 metre

The passage

will remain

private.

170

a) For single

plot

b) For two to

four plots

1.5 metre

(ii) When it is

intended to

serve upto two

plots and length

of the passage

does not exceed

40 metres)

3.0 metres The passage

will remain

private

(iii) When it is

intended to

serve up to

four plots and

length of the

passage does not

exceed 80

metres)

3.6 metres -Do-

(iv) When it is

intended to

serve up tb

ten plots and

length of the

passage does

not exceed 100

metres)

4.8 metres -DoB. Streets and

Roads

(i) Streets

intended to

serve not more

than 16 plots and

/ or subject to a

maximum length

of 120 metres

7.2 metres All streets

shall become

public

(ii) Streets

intended to

serve not more.

than 20 plots

and / or subject

to a maximum

9.0 metres All streets

shall become

public

171

length of 240

metres

(iii) Roads of

length more than

240 metres but

below 400 metres

(iv) Roads of

length between

400 metres to

1,000 metres

34.0

metres

18.0

metres

All streets

shall become

public

All streets

shall become

public

(v) Roads of

length more than

1000 metres

24.0

metres

All streets

shall become

public

29(3)(b) for Industrial Development

Description

(1)

Minimum

width of

passage

(2)

Remarks

(3)

(1) When it is

intended to

serve only

one plot and

length of the

passage does not

exceed 100

metres

5.0 metres The passage

will remain

private

(2) When it is

intended to

serve two to

five plots and

the length of

the passage

does not exceed

120

7.2 metres -Do-

172

metres

(3) When it is

intended to

serve more than

5 plots

12.0 metres The street

shall become

public.

Note: Not withstanding anything contained above

Authority reserves the right to revise layouts

proposed by the applicant and applied for

sanction in order to provide for better adequate

linkages proper circulation pattern requirements

considering local conditions etc.”

120. It becomes clear that in regard to streets and

roads what is contemplated under the regulation is that

under 29 (3)(a) (B) all streets will become public.

This is to be read along with Regulation 29(7)(a).

It is apparently to ensure that the roads which are

covered by 29(3)(a)(B) which are to be treated as

public are so maintained that it is insisted under

29(7)(a) that a gift deed be executed. In other words,

keeping in mind the preambular portion of Regulation

29 which proclaims that the regulation seeks to provide

access to plots by way of roads and private passages

creating a hierarchy of roads based on road length,

intensity of developments in the area and also provide

adequate linkages to the existing roads and proposed

173

roads in the Master Plan and a detailed development

plan and to provide proper circulation pattern in the

area inter alia, we must arrive at the conclusion that

visionary perspective of town planning would require

an imaginative full play being given. Meticulous

requirements of futuristic needs of an ever-growing

Metropolis when a large area such as what would be

found in a layout of more than 10000 square meters

which is nearly one hectare of land in the metropolitan

area must be factored in. Circulation of traffic

between parts of the area would require the roads being

thrown open to the public so that different parts of

the metropolitan area can be easily accessed. In fact,

even the writ petitioner by seeking to limit the

challenge in the first place only to Regulation

29(7)(a) and not to Regulation 29(3)(a)(B) under which

anyway the streets are declared as public acknowledges

the need for and justification for the declaration of

roads being public.

121. The argument of the respondent appears to be as

follows:

174

The execution of a gift deed acts as a safety valve

or a safeguard to check the possibility that the

developer would resile from the assurance or violate

the guarantee that the land, which is reserved as an

open space, will not be constructed upon. In other

words, if the execution of the gift deed is insisted

upon to ensure that in the future, there would not be

any contravention of the requirement, inter alia, that

the area be used as an open space, then, the complaint,

which is lodged against the impugned Rule, as also the

Regulation, may not stand scrutiny. In regard to the

impugned Regulation, it must be borne in mind, as we

have already noticed that in the additional affidavit

filed by the Writ Petitioner in Writ Petition (C) No.

591 of 2015, the challenge in the writ petition has

been limited to the latter part of the provision, i.e.,

the requirement to transfer free-of-cost, through a

registered gift deed, the 10 per cent recreational area

reserved for recreational purposes only and not the

space set apart for roads. Here, we must observe that

as already found by us, that there is no challenge to

175

Regulation 29(6). The writ petitioner does not seek to,

bring under a cloud, Regulation 29(7)(a) otherwise.

122. The result of the above discussion is as follows:

We must proceed on the basis that Regulation 29(6)

holds good. This means that when the layout is above

10,000 square meters, reservation of 10 per cent for

recreational purposes has to be made. Regulation

29(6)(a) stipulates that the land for the communal and

recreational purposes, is to be restricted to the

ground level and in a shape and location to be specified

by the Authority. It is also to be reserved free from

any construction. Therefore, the reservation, which is

mandated in terms of Regulation 29(6)(a), and which

cannot be a subject matter of a claim for compensation

under Section 39 of the Act, is to become the subject

matter of the gift deed. The execution of the gift

deed, if it is understood as merely as an

insurmountable obstacle for an unscrupulous developer

to get around the laudable mandate to preserve the

requisite area as open space, cannot be rendered

vulnerable. Even if, no gifts were to be executed, the

176

property covered by the open space requirement, would

be put beyond the domain and control of the developer.

Future generations of successors-in-interest or

anyone, who claims under him, will be effectively

prevented from setting up any claim over the area.

Viewed in this perspective and understanding the gift

as not conferring ownership of the area comprised in

the open space, we would think that the impugned

provisions would pass muster. It would prevent any kind

of abuse. It is clear that the Regulation, properly

understood, prescribe for the open space and merely

provides for the facilitation and preservation of the

open space.

A BRIEF LOOK AT THE FIFTH AMENDMENT CASES

IN THE UNITED STATES

123. The Fifth Amendment to the U.S. Constitution,

inter alia, declares ‘nor shall private property be

taken for public use without just compensation’. This

limb of the Fifth Amendment has spawned a large body

of case law. We may only advert to a few of them. In

Agins (supra), the brief facts were as follows:

177

The owners of a five-acre parcel of unimproved land

challenged the placing of the land by adopting of

Zoning Ordinances, by which, the land was placed in

residential planned development and open space zone,

which permitted the owners to build between 1 and 5

single family residences. The appellants asserted

infraction of the Fifth and the Fourteenth Amendments

and sought damages for inverse condemnation. (Inverse

condemnation amounts to proceedings seeking

compensation for compulsorily acquiring land without

there being any formal proceedings for acquisition).

The challenge was repelled by the U.S. Supreme Court.

It was found that there was no violation of the Takings

Clause in the Fifth Amendment. It must be made clear

that the Taking Clause is based on the prohibition

against the taking of private property for public use

without just compensation. The Court, inter alia, held

as follows:

“The application of a general zoning law to

particular property effects a taking if the

ordinance does not substantially advance

legitimate state interests, see Nectow v.

Cambridge, 277 U.S. 183, 188, 48 S.Ct. 447,

448, 72 L.Ed. 842 (1928), or denies an owner

economically viable use of his land, see Penn

178

Central Transp. Co. v. New York City, 438 U.S.

104, 138, n. 36, 98 S.Ct. 2646, 2666, 57

L.Ed.2d 631 (1978). The determination that

governmental action constitutes a taking is,

in essence, a determination that the public at

large, rather than a single owner, must bear

the burden of an exercise of state power in

the public interest. Although no precise rule

determines when property has been taken,

see Kaiser Aetna v. United States, 444 U.S.

164, 100 S.Ct. 383, 62 S.Ct. 332 (1979), the

question necessarily requires a weighing of

private and public interests. The seminal

decision in Euclid v. Ambler Co., 272 U.S. 365,

47 S.Ct. 114, 71 L.Ed. 303 (1926), is

illustrative. In that case, the landowner

challenged the constitutionality of a

municipal ordinance that restricted commercial

development of his property. Despite alleged

diminution in value of the owner's land, the

Court held that the zoning laws were facially

constitutional. They bore a substantial

relationship to the public welfare, and their

enactment inflicted no irreparable injury upon

the landowner.”

124. In James Patrick Nollan v. Calefornia Coastal

Commission60, the following were the facts:

The prospective purchasers of a beach front plot,

which was located between two public beaches, proposed

to satisfy a condition on their option to purchase by

pulling down an old bungalow on the premises. It was

to be replaced with a larger house. The respondent

60 483 US 825, 97 L Ed 2d 677,

179

Commission stipulated the condition that purchasers

must give the public an easement to pass across the

portion of the property which lay between the mean high

tide line. The purchasers took shelter under the

Takings Clause. In 5:4 Majority Judgment, the Court

took the view that the Takings Clause was offended. In

the course of the Judgment, the Court held, inter alia:

“[1b, 5] “Given, then, that requiring

uncompensated conveyance of the easement

outright would violate the Fourteenth

Amendment, the question becomes whether

requiring it to be conveyed as a condition for

issuing a land-use permit alters the outcome.

We have long recognized that land-use

regulation does not effect a taking if it

“substantially advance[s] legitimate state

interests” and does not “den[y] an owner

economically viable use of his land,” Agins v.

Tiburon, 447 U.S. 255, 260, 100 S.Ct. 2138,

2141, 65 L.Ed.2d 106 (1980). See also Penn

Central Transportation Co. v. New York

City, 438 U.S. 104, 127, 98 S.Ct. 2646, 2660,

57 L.Ed.2d 631 (1978) (“[A] use restriction may

constitute a ‘taking’ if not reasonably

necessary to the effectuation of a substantial

government purpose”).”

xxx xxx xxx

“[1c] The Commission argues that a permit

condition that serves the same legitimate

police-power purpose as a refusal to issue the

permit should not be found to be a taking if

the refusal to issue the permit would not

constitute a taking. We agree. Thus, if the

Commission attached to the permit some

180

condition that would have protected the

public's ability to see the beach

notwithstanding construction of the new house—

for example, a height limitation, a width

restriction, or a ban on fences—so long as the

Commission could have exercised its police

power (as we have assumed it could) to forbid

construction of the house altogether,

imposition of the condition would also be

constitutional. Moreover (and here we come

closer to the facts of the present case), the

condition would be constitutional even if it

consisted of the requirement that the Nollans

provide a viewing spot on their property for

passersby with whose sighting of the ocean

their new house would interfere. Although such

a requirement, constituting a permanent grant

of continuous access to the property, would

have to be considered a taking if it were not

attached to a development permit, the

Commission's assumed power to forbid

construction of the house in order to protect

the public's view of the beach must surely

include the power to condition construction

upon some concession by the owner, even a

concession of property rights, that serves the

same end. If a prohibition designed to

accomplish that purpose would be a legitimate

exercise of the police power rather than a

taking, it would be strange to conclude that

providing the owner an alternative to that

prohibition which accomplishes the same

purpose is not. The evident constitutional

propriety disappears, however, if the

condition substituted for the prohibition

utterly fails to further the end advanced as

the justification for the prohibition.”

181

125. In Florance Dolan v. City of Tigard61, again the

scope of the Fifth Amendment or rather the Takings

Clause thereunder, fell for consideration. The owner

of a city plot applied for a building permit for a

bigger store than she had with certain other

facilities, including parking area. The permission

though granted came with two conditions. The owner was

to dedicate to the city, as a greenway, a portion of

her lot within the 100-year floodplain of a creek,

which flowed through one corner and along one boundary

of the lot. The owner had also to dedicate to the city

as a pedestrian/bicycle pathway, an additional 15-foot

strip of land adjacent to the floodplain. Her request

for variance of the conditions was rejected. This stand

was approved by the Authorities as also the Court of

Appeals with four learned Judges dissenting with the

Majority, remitted the matter back. Distinguishing the

decision in Village of Euclid v. Ambler Reality

Company62 and Agins (supra), the Court held, inter

alia, as follows:

61 512 US 374

62 272 US 365

182

“9. The sort of land use regulations discussed

in the cases just cited, however, differ in two

relevant particulars from the present case.

First, they involved essentially legislative

determinations classifying entire areas of the

city, whereas here the city made an

adjudicative decision to condition

petitioner's application for a building permit

on an individual parcel. Second, the conditions

imposed were not simply a limitation on the use

petitioner might make of her own parcel, but a

requirement that she deed portions of the

property to the city. In Nollan,

supra, we held that governmental authority to

exact such a condition was circumscribed by the

Fifth and Fourteenth Amendments. Under the

well-settled doctrine of “unconstitutional

conditions,” the government may not require a

person to give up a constitutional right—here

the right to receive just compensation when

property is taken for a public use—in exchange

for a discretionary benefit conferred by the

government where the benefit sought has little

or no relationship to the property. See Perry

v. Sindermann, 408 U.S. 593, 92 S.Ct. 2694, 33

L.Ed.2d 570 (1972); Pickering v. Board of Ed.

of Township High School Dist. 205, Will

Cty., 391 U.S. 563, 568, 88 S.Ct. 1731, 1734,

20 L.Ed.2d 811 (1968).

Petitioner contends that the city has forced

her to choose between the building permit and

her right under the Fifth Amendment to just

compensation for the public easements.

Petitioner does not quarrel with the city's

authority to exact some forms of dedication as

a condition for the grant of a building permit,

but challenges the showing made by the city to

justify these exactions. She argues that the

city has identified “no special benefits”

conferred on her, and has not identified any

“special quantifiable burdens” created by her

new store that would justify the particular

183

dedications required from her which are not

required from the public at large.”

xxx xxx xxx

“[1c, 2d, 11a] We think the “reasonable

relationship” test adopted by a majority of the

state courts is closer to the federal

constitutional norm than either of those

previously discussed. But we do not adopt it

as such, partly because the term “reasonable

relationship” seems confusingly similar to the

term “rational basis” which describes the

minimal level of scrutiny under the Equal

Protection Clause of the Fourteenth

Amendment. We think a term such as “rough

proportionality” best encapsulates what we

hold to be the requirement of the Fifth

Amendment. No precise mathematical calculation

is required, but the city must make some sort

of individualized determination that the

required dedication is related both in nature

and extent to the impact of the proposed

development.”

126. The remand was limited to the first condition. In

regard to the second condition, viz., dedication for

the pedestrian bicycle pathway, the Court held as

follows:

“[1g, 13] With respect to the

pedestrian/bicycle pathway, we have no doubt

that the city was correct in finding that the

larger retail sales facility proposed by

petitioner will increase traffic on the streets

of the Central Business District. The city

estimates that the proposed development would

generate roughly 435 additional trips per

day.9 Dedications for streets, sidewalks, and

184

other public ways are generally reasonable

exactions to avoid excessive congestion from a

proposed property use. But on the record before

us, the city has not met its burden of

demonstrating that the additional number of

vehicle and bicycle trips generated by

petitioner's development reasonably relate to

the city's requirement for a dedication of the

pedestrian/bicycle pathway easement. The city

simply found that the creation of the pathway

“could offset some of the traffic demand ...

and lessen the increase in traffic congestion.”

As Justice Peterson of the Supreme Court of

Oregon explained in his dissenting opinion,

however, “[t]he findings of fact that the

bicycle pathway system ‘could offset some of

the traffic demand’ is a far cry from a finding

that the bicycle pathway system will, or

is likely to, offset some of the traffic

demand.” 317 Ore., at 127, 854 P.2d, at

447 (emphasis in original). No precise

mathematical calculation is required, but the

city must make some effort to quantify its

findings in support of the dedication for the

pedestrian/bicycle pathway beyond the

conclusory statement that it could offset some

of the traffic demand generated.”

127. No doubt, there were vigorous dissents expressed

by the four learned Judges. In the dissent by Justice

Stevens, with whom Justice Blackmun and Justice

Ginsburg agreed, the essential nexus requirement

propounded in Nollan (supra) was recognised. The

dissenting Judges, however, opposed the employment of

the ‘rough proportionality’ requirement. Decrying the

185

consequences that may follow from the requirement to

make ‘individualised determinations’, the learned

Judges found that the questions could be answered under

the framework of the existing caselaw. The learned

Judges also found that there was no basis for applying

the ‘Unconstitutional Conditions’ Doctrine. We are

tempted to and rightfully so, to advert to the

following observations in the dissenting Judgments in

regard to the true place of the Doctrine of

Unconstitutional Conditions:

“Even if Dolan should accept the city's

conditions in exchange for the benefit that she

seeks, it would not necessarily follow that she

had been denied “just compensation” since it

would be appropriate to consider the receipt

of that benefit in any calculation of “just

compensation.”

xxx xxx xxx

“In this respect, the Court's reliance on the

“unconstitutional conditions” doctrine is

assuredly novel, and arguably incoherent. The

city's conditions are by no means immune from

constitutional scrutiny. The level of

scrutiny, however, does not approximate the

kind of review that would apply if the city

had insisted on a surrender of Dolan's First

Amendment rights in exchange for a

building permit.”

186

128. In Linda Lingle, Governor of Hawaii, et al. v.

Chevron U.S.A.INC.63 in the context of a State statute

limiting the rent that oil companies could charge to

its dealer who lease service stations owned by the

companies took the view after noticing Nollan (supra)

and Dolan (supra) which we have referred to that

“substantially advances” formula is not a valid Takings

test initiated in Agnis (supra) and it was concluded

that it has no proper place in the Takings

jurisdiction.

129. In Village of Euclid, Ohio Et Al v. Ambler Reality

Company64, the village of Euclid lay in the form of a

parallelogram. The appellant was the owner of the land

measuring 68 acres. The entire area of the village was

divided into six classes of use places.

130. We may notice they appear to be similar to the

zones contemplated under the DCR in the instant cases.

There were restrictions in regard to use, the number

of dwellings and the height, inter alia. Appellant’s

land fell under U-2, U-3 and U-6. The Ordinance came

63 544 US 528, 161 L.Ed.2d 876

64 272 US 365 (1926)

187

to be challenged on the ground that it deprived the

appellant of its right to liberty and property without

due process of law as also equal protection of the law

under the Fourteenth Amendment to the U.S.

Constitution. Certain provisions of the State

Constitution were also relied upon.

131. Though in the context of the validity of the

restrictions under the Zoning Ordinance, we notice the

prescience of mind with which the Court approached the

matter and refused to apply constitutional safeguards:

“Building zone laws are of modern origin. They

began in this country about 25 years ago. Until

recent years, urban life was comparatively

simple; but, with the great increase and

concentration of population, problems have

developed, and constantly are developing,

which require, and will continue to require,

additional restrictions in respect of the use

and occupation of private lands in urban

communities. Regulations, the wisdom,

necessity, and validity of which, as applied

to existing conditions, are so apparent that

they are now uniformly sustained, a century

ago, or even half a century ago, probably would

have been rejected as arbitrary and oppressive.

Such regulations are sustained, under the

complex conditions of our day, for reasons

analogous to those which justify traffic

regulations, which, before the advent of

automobiles and rapid transit street railways,

would have been condemned as fatally arbitrary

and unreasonable.”

188

132. In the recent judgment relating to land use in the

United States reported in Coy A. Koontz v. St. Johns

River Water Management District65, the Court, speaking

through the majority Judgment (5:4), had the following

facts before it. The petitioner therein decided to

develop a 3.7 acre section of his property and he

applied for certain permits required in this regard.

To mitigate the environmental effects of his proposal,

the petitioner offered to foreclose any possible future

development of the approximately 11 acres southern

section of his land by deeding to the district a

conservation easement on that portion of his property.

The District, however wanted the petitioner to reduce

the size of development to 1 acre and deed the

conservation easement to the remaining extent of 13.9

acres. The District wanted the petitioner to make

improvement to District owned wet lands, several miles

away. The District hinted all that it would consider

alternative wherein monetary equivalent was proposed.

65 133 S.Ct. 2586 (2013)

189

It is in these facts that the majority view was inter

alia as follows: -

“II A [1,2] We have said in a variety of

contexts that “the government may not deny a

benefit to a person because he exercises a

constitutional right.” Regan v. Taxation

With Representation of Wash., 461 U.S. 540,

545, 103 S.Ct. 1997, 76 L.Ed.2d 129 (1983). See

also, e.g., Rumsfeld v. Forum for Academic and

Institutional Rights, Inc., 547 U.S. 47, 59–

60, 126 S.Ct. 1297, 164 L.Ed.2d 156

(2006); Rutan v. Republican Party of Ill., 497

U.S. 62, 78, 110 S.Ct. 2729, 111 L.Ed.2d 52

(1990).”

xxxx xxxx xxxx

“A second reality of the permitting process is

that many proposed land uses threaten to impose

costs on the public that dedications of

property can offset. Where a building proposal

would substantially increase traffic

congestion, for example, officials might

condition permit approval on the owner's

agreement to deed over the land needed to widen

a public road.”

xxxx xxxx xxxx

“(3) …Under Nollan and Dolan the government

may choose whether and how a permit applicant

is required to mitigate the impacts of a

proposed development, but it may not leverage

its legitimate interest in mitigation to pursue

governmental ends that lack an essential nexus

and rough proportionality to those impacts.”

190

xxxx xxxx xxxx

“(7) …Extortionate demands for property in the

land-use permitting context run afoul of the

Takings Clause not because they take property

but because they impermissibly burden the right

not to have property taken without just

compensation. As in other unconstitutional

conditions cases in which someone refuses to

cede a constitutional right in the face of

coercive pressure, the impermissible denial of

a governmental benefit is a constitutionally

cognizable injury.”

xxxx xxxx xxxx

“(13) …We agree with respondent that, so long

as a permitting authority offers the landowner

at least one alternative that would

satisfy Nollan and Dolan, the landowner has

not been subjected to an unconstitutional

condition.”

133. It is noteworthy to begin with that in India there

is no provision similar to the Takings clause in the

th amendment to the US constitution. It is in fact true

that Article 31(2) did provide that a person could not

be deprived of his property except after payment of

compensation. Article 31 stands deleted by the FortyFourth Amendment. In Article 300A, what has been

inserted by the same amendment is only the first limb

191

of Article 31, viz., no person shall be deprived of his

property save by authority of law. The ambit of this

Article has been discussed in the decision in K.T.

Plantations (supra).

134. Even under the Takings clause, we may only notice

Nollan-Dolan (supra) and as interpreted by the majority

in Koontz (supra) it is open to the government to

consider how the permit applicant must mitigate the

impacts of a proposed development and what is required

to make State action legitimate is that the conditions

imposed must bear an essential nexus and a rough

proportionality to the impacts perceived.

ENTRY 42 OF LIST III OF THE SEVENTH SCHEDULE

135. Is the impugned Rule/Regulation, a case where it

would be said that Entry 42 in List III to the Seventh

Schedule applies? In other words, is there acquisition

of land and is it a case of exercise of eminent domain

by the state? Is it a case where the impugned provisions

are more relatable to the exercise of police power?

Does the impugned provision constitute deprivation of

property within the meaning of Article 300A? Since we

192

have held that the impugned provision in the case of

the rule is law, would not the Rule be a law which

provides for deprivation of property, and therefore,

there is no violation involved at all. Does the

impugned Rule bring about deprivation and for which

compensation must be paid, failing which it cannot but

perish by placing it side by side with Article 300A?

136. We have noticed that right from 1975 onwards with

the promulgation of DCR along with a master plan, and

subsequently, in the year 2008, with the enactment of

the regulations, and still, what is more, in

supersession of the Regulations by the Rules of 2019,

the Law Giver has put in place the requirement of making

available 10 per cent of land excluding roads for the

purpose of communal and recreational purposes, when the

layout exceeds 10000 square meters.

137. To the question, which we posed, viz., whether what

is involved is acquisition of the property or an

exercise of the power of eminent domain, we are of the

view that stipulating the conditions that a person who

seeks to develop his property in a sprawling and evergrowing urban metropolis which is sought to be

193

regulated by a law relating to a town planning cannot

be viewed as acquisition of land within the meaning of

Entry 42 in List III. Acquisition of land involves, no

doubt, compulsory divesting of the rights of a person

in his property.

138. We must bear in mind that while right to hold and

enjoy property was a Fundamental Right under Article

19(1)(f), w.e.f. 1978 it ceased to be a Fundamental

Right. Equally, Article 31, which was also a

Fundamental Right in regard to property, including the

right to compensation as provided under Article 31(2)

stood deleted. Article 300A was inserted resurrecting

only Article 31(1). The right to property has been

described by this Court as a Statutory Right; a human

right and also a constitutional right. We must

therefore proceed on the basis that a person would

continue to have despite the Forty-Fourth Amendment, a

statutory right, a human right and a constitutional

right to property.

139. An acquisition is a compulsory vesting of the

property of a person with the state. It is traceable

undoubtedly to the power of eminent domain assured to

194

every sovereign. It can undoubtedly be exercised only

for securing public interest as contrasted with

promotion of private interest (See K.T. Plantation

(supra)66).

140. K.T. Plantations (supra) was a case which involved

the validity of a law which provided for compulsory

acquisition under the State enactment. The

understanding of this Court in K.T. Plantations (supra)

was that a person cannot be deprived of his property

merely by executive fiat without any specific legal

authority or without support of law made by a competent

Legislature (See paragraph-168). We must notice here

that law for the scope of Article 300A has been

explained by this Court in Bishambhar Dayal Chandra

Mohan and others v. State of Uttar Pradesh and others67

(paragraph-41) as follows:

“41. There still remains the question whether

the seizure of wheat amounts to deprivation of

property without the authority of law. Article

300-A provides that no person shall be deprived

of his property save by authority of law. The

State Government cannot while taking recourse

to the executive power of the State under

Article 162, deprive a person of his property.

66 (2011) 9 SCC 1

67 (1982) 1 SCC 39

195

Such power can be exercised only by authority

of law and not by a mere executive fiat or

order. Article 162, as is clear from the

opening words, is subject to other provisions

of the Constitution. It is, therefore,

necessarily subject to Article 300-A. The word

“law” in the context of Article 300-A must mean

an Act of Parliament or of a State legislature,

a rule, or a statutory order, having the force

of law, that is positive or State made law.

The decisions in Wazir Chand v. State of

H.P. [AIR 1954 SC 415: (1955) 1 SCR 408 : 1954

SCJ 600 : 1954 Cri LJ 1029] and Bishan

Das v. State of Punjab [AIR 1961 SC 1570 :

(1962) 2 SCR 69 : (1963) 1 SCJ 405] are an

authority for the proposition that an illegal

seizure amounts to deprivation of property

without the authority of law. In Wazir Chand

case [AIR 1954 SC 415 : (1955) 1 SCR 408 : 1954

SCJ 600 : 1954 Cri LJ 1029] the police in India

seized goods in possession of the petitioner

in India at the instance of the police of the

State of Jammu & Kashmir. The seizure was

admittedly not under the authority of law,

inasmuch as it was not under the orders of any

Magistrate; nor was it under Sections 51, 96,

98 and 165 of the Code of Criminal Procedure,

1898, since no report of any offence committed

by the petitioner was made to the police in

India, and the Indian police were not

authorised to make any investigation. In those

circumstances, the Court held that the seizure

was not with the authority of law and amounted

to an infringement of the fundamental right

under Article 31(1). The view was reaffirmed

in Bishan Das case [AIR 1961 SC 1570 : (1962)

2 SCR 69 : (1963) 1 SCJ 405].”

196

141. What this Court in K.T. Plantations (supra) meant

was to distinguish ‘law’ as a legislative measure as

distinct from mere Executive fiat.

142. The intention of Parliament was to do away with

the Fundamental Right to acquire, hold and dispose of

property (See paragraph-179). Deprivation of property

must take place for public purpose primarily (See

paragraph-180). Public purpose must be given an

expansive meaning (See paragraph-181). Payment of

compensation is a constitutional requirement under

Article 30(1)(A) and under the second proviso to

Article 31(A)(1) unlike Article 300A. After the FortyFourth Amendment, the constitutional obligation to pay

compensation to a person deprived of his property is

dependent on the Statute. (See para 183). We may refer

to the following observations in paragraph 188:

“188. We find no apparent conflict with the

words used in List III Entry 42 so as to infer

that the payment of compensation is inbuilt or

inherent either in the words “acquisition and

requisitioning” under List III Entry 42. Right

to claim compensation, therefore, cannot be

read into the legislative List III Entry 42.”

197

143. This would mean that the argument of the parties,

based on the impugned provisions being violative of

Article 254 of the Constitution, is untenable. We may

equally notice paragraph-189:

“189. Requirement of public purpose, for

deprivation of a person of his property under

Article 300-A, is a precondition, but no

compensation or nil compensation or its

illusiveness has to be justified by the State

on judicially justiciable standards. Measures

designed to achieve greater social justice, may

call for lesser compensation and such a

limitation by itself will not make legislation

invalid or unconstitutional or confiscatory.

In other words, the right to claim compensation

or the obligation to pay, though not expressly

included in Article 300-A, it can be inferred

in that article and it is for the State to

justify its stand on justifiable grounds which

may depend upon the legislative policy, object

and purpose of the statute and host of other

factors.”

144. We may also recapture paragraphs-191 and 192:

“191. The legislation providing for

deprivation of property under Article 300-A

must be “just, fair and reasonable” as

understood in terms of Articles 14, 19(1)(g),

26(b), 301, etc. Thus in each case, courts will

have to examine the scheme of the impugned Act,

its object, purpose as also the question

whether payment of nil compensation or nominal

compensation would make the impugned law

unjust, unfair or unreasonable in terms of

other provisions of the Constitution as

indicated above.”

198

“192. At this stage, we may clarify that there

is a difference between “no” compensation and

“nil” compensation. A law seeking to acquire

private property for public purpose cannot say

that “no compensation shall be paid”. However,

there could be a law awarding “nil”

compensation in cases where the State

undertakes to discharge the liabilities

charged on the property under acquisition and

onus is on the Government to establish validity

of such law. In the latter case, the Court in

exercise of judicial review will test such a

law keeping in mind the above parameters.”

145. A perusal of the paragraphs, which we have adverted

to, would reveal that, while in paragraph-189, it is

made to appear that no compensation or nil compensation

or its illusiveness has to be justified on judicially

justifiable standards, in paragraph-192, it is held

that a law providing for acquisition of private

property for public purpose cannot say that no

compensation could be paid. At this juncture, we

consider it apposite to refer to paragraph-141:

“141. Eminent domain is distinguishable alike

from the police power, by which restriction are

imposed on private property in the public

interest e.g. in connection with health,

sanitation, zoning regulation, urban planning

and so on from the power of taxation, by which

the owner of private property is compelled to

contribute a portion of it for the public

199

purposes and from the war power, involving the

destruction of private property in the course

of military operations. The police power

fetters rights of property while eminent domain

takes them away. Power of taxation does not

necessarily involve a taking of specific

property for public purposes, though analogous

to eminent domain as regards the purposes to

which the contribution of the taxpayer is to

be applied. Further, there are several

significant differences between regulatory

exercises of the police powers and eminent

domain of deprivation of property. Regulation

does not acquire or appropriate the property

for the State, which appropriation does and

regulation is imposed severally and

individually, while expropriation applies to

an individual or a group of owners of

properties.”

146. What is of interest to this Court in these cases

is the observation that eminent domain is to be

contrasted with police power, where restrictions are

put in public interest, in connection with zoning

regulations, urban planning, inter alia, by which the

owner of a private property is compelled to contribute

a portion of it for public purpose. No doubt, it is

also held that Regulation does not acquire or

appropriate the property.

147. We must appreciate the issues before us in the

light of the said exposition.

200

148. The impugned provision does not represent in our

view, a case of compulsory acquisition of land. A case

of compulsory acquisition would be without there being

any volition or consent of a person. The State purports

to divest his rights in property and vest the rights

with the State. The impugned provision does not appear

to us to be a case of such acquisition as is

contemplated in a law which is made with reference to

Entry 42 in List III. In this context, we must also

deal with the case based on Section 20 of the Act.

Section 20 deals with contents of detailed development

plan. Section 20 (d) reads as follows and it provides,

inter alia, the contents:

“Section 20(d). The acquisition by purchase,

exchange or otherwise of any land or other

immovable property within the area included in

the detailed development plan whether required

immediately or not.”

149. From a perusal of the said provisions, what it

contemplated, can be summed-up as follows. A detailed

development plan can propose or provide to purchase or

exchange any land or immovable property. The land may

be required immediately or it may be not so immediately

201

required. What is important is apart from purchase and

exchange, the property may be ‘acquired otherwise’. We

are not concerned with a challenge to Section 20. As

Section 20 stands acquisition by way of a gift cannot

be said to be incongruous merely by reference to the

two other expressly articulated modes of transfer of

title, viz., purchase and exchange. Undoubtedly, a gift

is a transfer of property without there being any

valuable consideration. It is an act of volition of the

owner. In other words, if a plan does provide that

right in land or other immovable property may be

acquired in terms of a gift which may be executed, it

may not involve straining the plain language, and also

involve pouring meaning into the width of the

expression ‘otherwise’ just as much as it avoids

placing a narrow connotation on a word of wide import.

150. The decision in Pandit Chetram Vashishta (supra)

was a decision, which turned on the absence of any

power under which the open space or park was to stand

vested in a corporation or to stand transferred to it.

In fact, this Court found that the effect of the

reservation was that the donor ceased to be the legal

202

owner of the land in dispute. He held the land for the

benefit of society or the public in general. The donor

became essentially a trustee preventing alienation of

his right. The court however drew a distinction between

the owner being transformed into the trustee and being

prevented from transferring his rights and the local

body being vested with the rights of the owner. As far

as the impugned provisions in these cases are

concerned, the DCR not only obliges setting apart a

certain percentage (10 per cent) for the communal and

recreational purposes in respect of very large projects

but also a transfer, is to be made of the property so

set apart by the owner. We will delve upon the impact

of this decision at a later point of time in a different

context. At the same time, we must also bear in mind,

the Judgment of this Court in Yogendra Pal and others

(supra). In Yogendra Pal and others, we have already

noticed the facts. What was involved there was the

violation of Section 192(1)(c) of the Punjab Municipal

Act, 1911. The provision provided that the Municipal

Committee may prepare a building scheme, which may,

inter alia, provide that the amount of land in unbuilt

203

area shall be transferred to the committee for public

purposes including use as public streets by owners of

land either on payment of compensation or otherwise,

provided that the total amount so transferred shall not

exceed thirty-five per cent, and the amount transferred

without payment shall not exceed twenty-five per cent,

of any one owner’s land within such unbuilt area. What

appealed to this Court as the basis for transgression

of Article 14 has been adverted to by us and which is

contained in paragraphs-14 and 15 of the said Judgment.

It must be remembered that the principal plank of

attack against the provision in question was that it

fell foul of Article 19(1)(f) read with Article 31 of

the Constitution as the Articles stood then. The

transfer effected in the said case, it may be noticed

was prior to 20.06.1979 on which date the Forty-Fourth

Amendment came into being. Therefore, the case was that

it amounted to acquisition of property. This Court

found merit in the contention that what was involved

was actually acquisition and the transfer was not

merely for a limited purpose. It was found that there

was no provision in the Act to suggest that despite

204

employment of the land for public purpose, the

ownership and possession or occupation continued with

the landowner. The landowner was compelled to enjoy

rights only as a member of the public. The Court also

rejected the case of the transfer being only for a

limited purpose. A perusal of Section 192(1)(c) reveals

that the said provision is not comparable with the

provision impugned in the cases before us. Section

192(1)(c) of the Punjab Tenancy Act, 1911 was clearly

in the nature of acquisition. The rights of the person

were extinguished effectively. The provision vested

power or a discretion to acquire land either on payment

of compensation or otherwise. As already noticed, this

was done at a time when Article 19(1)(f) and Article

31 of the Constitution, both being Fundamental Rights,

continued to hold the field. No doubt, the decision is

rested ultimately on the impugned provision being found

to be contrary to Article 14. What is pertinent,

however, is that, in the case of the Rule/Regulation

impugned, as we have already found, is not a case of

exercise of power of eminent domain, and it is not a

case of acquisition by means of compulsory exaction of

205

the property. What is involved in these cases, is a

different factual matrix. A person or a group of

persons, owning an extent of land, which is in excess

of 10,000 square metres in a fast-growing urban

metropolis, wish to develop the land. It is,

apparently, a commercial venture. They put-up, what is

called, special buildings or group development. This

involves making optimum use of the land by putting up

vertical constructions. In other words, ordinarily,

large number of persons would come to occupy the area

with a layout of more than 10,000 square metres. The

Law Giver has contemplated provision of roads within

the layout of roads. In fact, the roads are themselves

to become public. Interestingly, even in the challenge

made by the Writ Petitioner in Writ Petition No. 651

of 2015, viz., the petitioner has specifically limited

the challenge to the regulation to the requirement of

gifting the area comprised in the land for communal and

recreational purposes. The Regulations, as did the

Rules, provide for the roads to become public and

become open to the members of the public. A gift, in

this regard, is not ironically objected to.

206

151. We have noticed from the pleadings that the

appellants and the petitioner substantially do not

challenge the setting apart of land for the purpose of

communal or recreational purpose. The objections appear

to be as follows. The word ‘communal’ must be

contextually interpreted to confine the benefit of

reservation for the occupants of the buildings and it

must not be made available to the members of the public.

In the case of Vasanth Apartments, they object to the

land set apart under the gift deed, being used to cater

to the members of the public in general, by converting

it into a public road. In fact, it must be remembered

that in the case of Vasanth Apartments, as rightly

pointed out by Shri Jayant Muth Raj, learned Senior

Counsel, the gift was not executed by the members of

the Association. The property was gifted by the

developer as a condition for developing the land. The

developer, in other words, who put together the project

or developed the project, is the person who would have

a right to have the property revested. He accepts the

gift. It is obvious that having been a party to the

gift it may not lie in his mouth to impeach the same.

207

[See in this regard the Judgment of this Court in

Narayanrao Jagobaji (supra)]. It is not as if the

members of the Vasanth Apartment Owners Association

claim to have an assignment of the right over the land

which is gifted from the original owner. Therefore, as

far as the members of the Vasanth Apartment Owners

Association are concerned, on the factual basis

available, it may not lie in their mouth, noticing two

other features as well, to contend that the Court must

invalidate the Rule. The gift was executed in the year

1994. The Writ Petition is filed almost 12 years after.

Secondly, the first Writ Petition, filed by the members

of the Vasanth Apartment Owners Association, was by

drawing support from the gift deed. They wanted that

the property must be continued as recreational and OSR

area. A learned Single Judge allowed the writ petition.

Thereafter, there were two Writ Appeals filed, one by

persons who claimed that the area was being used as a

public road, and another, by the Corporation of Chennai

and the CMDA. There was an interim Order passed by the

Division Bench. It is thereafter, that the second Writ

Petition is filed by them challenging the Rule. While,

208

it is true that mere passage of time will not make an

unconstitutional provision valid, the delay, with which

a prevailing Statute is impugned, becomes a factor,

which the Court would not ignore. In this case, as if

such factors were not sufficient, we notice the further

development. The Rules came to be repealed by the

Regulations in the year 2008 and the Regulation stood

repealed in the year 2019 by Statutory Rules made in

the said year. The challenge to the Rule, on the basis

of Article 300A and, indeed, Article 14 as well by

Association of Vasanth Apartment Owners Association

must fail, as it cannot even be their case that their

right in property was deprived. The appellants never

had any proprietary right in the property to allege

deprivation of the same. Even if the Rule is found bad,

there can be no question of voiding the gift at the

appellant’s instance.

152. In the case of M/s. Keyaram Hotels Pvt. Ltd., their

complaints, apart from those dealing with legality of

the Rule on other grounds, which we had noticed and

discussed, remain the following.

209

Before we go to the other complaints, we have

already noticed, in paragraph 10 of the Writ Petition,

the appellant/petitioner (M/s. Keyaram Hotels Pvt.

Ltd.) has expressed its willingness for stipulating

open space as required for communal and recreation use

of the occupiers and lawful uses of the building and

it was specifically averred that it would satisfy the

public interest. It is specifically undertaken that

they will keep 10 per cent of the area as open space

for communal and recreational purpose. However, they

have raised the complaint that further, apart from the

direction to execute the gift, the condition, imposed

to provide exclusive frontage for the said open space

into the main road, is unsustainable in law. It is the

complaint that the attempt to the third respondent is

to gain entry into the property of the petitioner to

make use of the open space reserved, detrimental to the

rights of the property owner.

153. The matter may be viewed in the following manner.

In the facts in Pandit Chetram Vashishta (supra), it

was held that the position of the developer, would be

that of a trustee. It was so held in the absence of a

210

statutory mandate. Now, in this case, there is a

statutory mandate to execute a gift deed. The question

would arise as to what would be the nature of the rights

of the donee, viz., the local authority. Would the

donee become an absolute owner? Can the local authority

transfer the land? Can the local authority build on the

OSR area? The answer to all these questions is only in

the negative. Unlike the donee, in the case of a gift,

the local authority cannot in anyway acquire the right

as the absolute owner. Just as in the case of Pandit

Chetram Vashishta (supra), where the developer would

be a trustee, we would think that the Rule, if is to

be upheld, in the conspectus of the law and bearing in

mind the object, the transfer by way of a gift to the

donee will be only for the purpose of ensuring that the

object of the law is attained, i.e., the property is

maintained as OSR. The local authority, under the gift

deed, would be a mere trustee. As trustee, it will be

the obligation of the local authority to ensure that

all such lands, set apart under the impugned Rules/

Regulations, are effectively maintained as such. In

211

this regard, in the Open Space Act, 1906, a U.K. Law,

Section 3 reads as follows:

“3 Transfer to local authority of spaces held

by trustees for purposes of public recreation.

(1) Where any land is held by trustees (not

being trustees elected or appointed under any

local or private Act of Parliament) upon trust

for the purposes of public recreation, the

trustees may, in pursuance of a special

resolution, transfer the land to any local

authority by a free gift absolutely or for a

limited term, and, if the local authority

accept the gift, they shall hold the land on

the trusts and subject to the conditions on and

subject to which the trustees held the same,

or on such other trusts and subject to such

other conditions (so that the land be

appropriated to the purposes of public

recreation) as may be agreed on between the

trustees and the local authority with the

approval of the Charity Commission.

(2) Subject to the obligation of the land so

transferred being used for the purposes of

public recreation, the local authority may hold

the land as and for the purposes of an open

space under this Act.”

154. The very goal of town planning requires nothing

less. Once the goal of executing the gift and the

results it produces in law, are appreciated in the

above manner, we find that the apprehensions and the

contentions of the appellant/petitioner lose their

212

sheen. We are unable to accept, in the context of the

Act of the Rules/ Regulations, that, in such a large

project, when the layout is more than 10,000 square

metres, executing a gift deed, which would ensure

compliance, would fall foul of the requirement of

either Article 14 or Article 300A. The developer/owner,

remained only a trustee even without a gift. The

provision for setting apart 10 per cent, is

invulnerable. The area will even without a gift remain

out of bounds for the project proponent/owner. The OSR,

being an inviolable requirement, the additional

requirement, meant and understood as a measure to

ensure compliance and prevent misuse and or disuse,

must not be understood as deprivation. As already

discussed, the gift will not convert the Local Body

into an absolute owner. Instead, in place of the

original owner, continuing as a trustee, the Local

Authority becomes the trustee. The purpose and the

nature of the obligation will remain and haunt both the

Local Body as also the original owner. The

Rule/Regulation at any rate also, is a law which

sanctions deprivation even assuming there is

213

deprivation. However, we are of the view that, in

substance, the Rule/Regulation cannot be understood as

deprivation under Article 300A.

155. We have indicated earlier that this Court has

recognised Right to Property as a Constitutional Right

on account of insertion of Article 300A. In the context

of the Principle of Unconstitutional Condition, as

recognised in the United States, could it be said that

the impugned Rule/Regulation presents a case of an

unconstitutional condition? While, as already found by

us, the impugned provisions, do not make out a case of

acquisition as it is not a compulsory divesting of

title and a gift is executed on the basis that the

project proponent/owner volunteers to execute the gift

deed and no doubt, in view of the Rule, the execution

of the gift deed, finally, brings in the element of

consent and takes the transaction out of the Doctrine

of Eminent Domain, which requires compulsory

acquisition de hors the consent of the person having

interest in the property, but then the question arises,

whether the impugned provisions involves a person

having a Constitutional Right under Article 300A,

214

having to sacrifice his Right as a condition to obtain

the development permit. This Court has declared the

right of a person to construct a building, is a right

under the law, viz., the Statute, which governs the

same. In the said sense, it becomes a Statutory Right.

The right is hedged in necessarily with limitations and

conditions. Now, superimposing the mandate of Article

300A, the question arises, whether the instant case

involves employment of an unconstitutional condition.

In Ahmedabad St. Xavier's College Society v. State of

Gujarat68, Justice Mathew while dealing with the content

of the right guaranteed under Article 30(1) in regard

to recognition or affiliation held inter alia as

follows:

“158. The doctrine of “unconstitutional

condition” means any stipulation imposed upon

the grant of a governmental privilege which in

effect requires the recipient of the privilege

to relinquish some constitutional right. This

doctrine takes for granted that ‘the petitioner

has no right to be a policeman’ but it

emphasizes the right he is conceded to possess

by reason of an explicit provision of the

Constitution, namely, his right “to talk

politics”. The major requirement of the

doctrine is that the person complaining of the

condition must demonstrate that it is

unreasonable in the special sense that it takes

68 (1974) 1 SCC 717

215

away or abridges the exercise of a right

protected by an explicit provision of the

Constitution (see William W. Van Alstyne: “The

Demise of the Right-Privilege Distinction in

Constitutional Law” [81 Harv Law Rev 1439]).”

156. In a case involving exercise of power to terminate

service of a permanent employee of public/semi

government undertaking or statutory corporations only

by giving a month’s notice, this Court inter alia held

in Delhi Transport Corpn. v. D.T.C. Mazdoor Congress69

as follows:

283. The problem also could be broached from

the angle whether the State can impose

unconstitutional conditions as part of the

contract or statute or rule etc. In (1959-60)

73 Harvard Law Review, in the Note under the

caption ‘Unconstitutional Condition’ at pages

1595-96 it is postulated that the State is

devoid of power to impose unconstitutional

conditions in the contract that the power to

withhold largesse has been asserted by the

State in four areas i.e. (1) regulating the

right to engage in certain activities; (2)

administration of government welfare

programme; (3) government employment; and (4)

procurement of contracts. It was further

adumberated at pages 1602-03 thus:

“The sovereign's constitutional authority to

choose those with whom it will contract for

goods and services is in effect a power to

withhold the benefits to be derived from

economic dealings with the government. As

69 (1991) Suppl.1 SCC 600

216

government activity in the economic sphere

increases, the contracting power enables the

government to control many hitherto

unregulated activities of contracting

parties through the imposition of conditions.

Thus, regarding the government as a private

entrepreneur threatens to impair

constitutional rights…. The government,

unlike a private individual, is limited in

its ability to contract by the Constitution.

The federal contracting power is based upon

the Constitution's authorisation of these

acts ‘necessary and proper’ to the carrying

out of the functions which it allocates to

the national government. Unless the

objectives sought by terms and conditions in

government contracts requiring the surrender

of rights are constitutionally authorised,

the conditions must fall as ultra vires

exercise of power.”

Again at page 1603, it is further emphasised

thus:

“When conditions limit the economic benefits

to be derived from dealings with the

government to those who forego the exercise

of constitutional rights, the exclusion of

those retaining their rights from

participation in the enjoyment of these

benefits may be violative of the prohibition,

implicit in the due process clause of Fifth

Amendment and explicit in the equal

protection clause of the Fourteenth Amendment

against unreasonable discrimination in the

governmental bestow of advantages. Finally,

disabling those exercising certain rights

from participating in the advantages to be

derived from contractual relations with the

government may be a form of penalty lacking

in due process. To avoid invalidation for any

of the above reasons, it must be shown that

the conditions imposed are necessary to

secure the legitimate objectives of the

217

contract, ensure its effective use, or

protect society from the potential harm which

may result from the contractual relationship

between the government and the individual.”

157. The Doctrine of Unconstitutional Condition

involves a person having to give-up a Constitutional

Right as a condition to obtain a benefit he is otherwise

entitled to. While it is in the context of Article

300A, to be understood that the Right to Property

cannot be deprived except in accordance with law and

even as held in K.T. Plantations (supra) that such law

must be fair and reasonable, once it is found that

there is such a law, then, even if there is deprivation,

it cannot be found that Article 300A is violated. We

have already found, in fact, that there is no

deprivation in the context of the impugned

Rules/Regulations. In the conspectus of the DCR/

Regulation, the nature of the right to property

available under the Constitution as expounded in K.T.

Plantations (supra), the seemingly never ending

imperative needs of an urban metropolis, the

indisputable need to set apart 10% for the recreational

purpose and the discussion we have already made with

218

regard to the effect of the gift and the purpose it

serves, we are of the view that the rule/regulation may

not give rise to any room for invoking the doctrine of

unconstitutional condition. We must continue to remain

alive to the vital dimension which we have already

indicated that the impugned provision essentially

pertains to what can be described as purely commercial

projects though it is linked with property rights. In

other words, particularly from the stand point of

invoking the doctrine of unconstitutional condition,

the distinction between the person putting up a

residential building and the proponent of a complex,

commercial project in a metropolis cannot be lost sight

of. At any rate, we cannot in the conspectus of the

Rule/Regulation and the salutary purpose, it seeks to

achieve hold the requirement as an “unreasonable

condition in a special sense”. [See para 155]

158. The case of the CMDA is that in view of the benefits

which accrue, it could be a case of nil compensation.

The distinction between nil compensation and no

compensation has been laid down to be that in the former

it is permissible on the basis that it becomes liable

219

to discharge the liability in regard to the

person/property. In the context of the rule/regulation,

we would not think that there would be violation of

Article 300A on the basis of it being a deprivation of

property involving breach of a mandate to pay

compensation. It must be at once noticed that what is

involved is the need to execute a gift. By its very

nature, in the case of a gift, there cannot be any

valuable consideration. If compensation is to be paid

then it would cease to be a gift. Having regard to the

discussion we have made regarding the validity of the

rule/regulation otherwise, we do not think that

execution of the gift which we have found transformed

the donee not as the absolute owner but as trustee

would require having regard to the salutary purpose,

the need to pay compensation. It may not be a case where

the respondent discharges any liability as such. It is

another matter that the project proponent stands to

make a considerable profit as a result of the

permission granted.

159. In case there is no requirement to execute a gift

of OSR area in terms of Pandit Chetram Vashishta

220

(supra), the project proponent/owner would remain in

the position of a trustee. As a trustee in law is the

legal owner, and therefore this being the position in

law, he may not be disabled from transferring the

property in any manner. However, as he is under

obligation as a trustee to maintain the property as

OSR, he cannot defeat the obligation by transferring

the same and it can lead to abuse. No doubt, he would

be prohibited from raising any construction over the

OSR area. One of the bundle of rights of an owner,

however, which would survive after the owner steps into

the shoes of a trustee, could be said to be the power

to exclude ‘others’ from the OSR area. The attribute

of ownership of property consisting of the power to

exclude others may continue with the project proponent

in the absence of a gift. Now, interestingly, this

again would depend upon the interpretation of the words

‘communal and recreational purpose’. This is for the

reason that if the OSR area can be accessed by members

of the general public as contended by the respondents,

then, the project proponent cannot possibly have the

right of an owner to exclude them. Equally, even with

221

the requirement to maintain the OSR area in the absence

of the demand for a gift, it could be said that the

sole project of proponent could have the right to

remain in possession. Another dimension may be noticed.

What would happen if the OSR area is acquired in the

exercise of the power of eminent domain for the public

purpose? Who would be entitled to the compensation, if

a gift is made in terms of the impugned

Rule/Regulation? We would think that since the

interpretation we are placing is that the gift under

the Rule/Regulation is intended only to ensure due

compliance with the requirement of the OSR area being

effected and to prevent misuse by the owner, as between

the original owner and the local authority, it would

be the original owner, who may be entitled to the

compensation.

160. The time, therefore, is ripe to deal with the

meaning of the words open space reservation of land for

communal and recreational purposes.

161. Group development falls under Rule 19(b)(2) of

the DCR. Group development is defined as accommodation

for residential or commercial or combination of such

222

activities housed in two or more blocks of buildings

in a particular site irrespective of whether these

structures are interconnected or not. Rule 19(b)(ii)

proceeded to provide for the minimum width of the

public road on which the site abuts. The vehicular

access way including passage if any within the site was

to have a minimum width. It also referred to set back

requirements. Parking standards were prescribed [See

19(b)(ii)(v)]. It is, thereafter, that the open space

requirement was provided by declaring that reservation

of land for communal and recreational purposes shall

be as follows and it must at this juncture be noticed

that there is an explanation, which reads as follows:

“Explanation: -

(1) For the purposes of this rules, existing

development defined as one “Where the extent

of ground area covered by structures already

existing (prior to application) in 25% and

above of the total site area”.

(2) In case of existing development where it

is difficult to leave the 10% area as open

space for communal / recreational purposes, the

Authority reserves the right to collect the

market value of equivalent land in lieu of the

land to be reserved. However, if on a future

date the developer wants to demolish the

existing structures and raise new structures

223

on the site in question, the communal and

recreational space shall be reserved, as per

rule.

(3) The land so reserved shall be free from

any construction by the owner or promoter or

developer. The land for communal and

recreational purposes shall be restricted at

ground level in a shape and location to be

specified by the Chennai Metropolitan

Development Authority.”

162. In the case of Writ Petition No. 691 of 2015

wherein the regulation of the year 2008 has been

challenged as we have noticed there is no challenge to

Regulation 29(6)(a), which, inter alia, provides how

the land reserved is to be restricted at the ground

level. It is true that there is a challenge to Annexure

XX, which we have extracted in paragraph 118 of the

judgment. But the absence of challenge to Regulation

29(6) is fatal. We must proceed on the basis that

there is no challenge to the terms of the explanation

to Rule 19(b)(II)(vi) which in Clause (iii) provides

that the land so reserved shall be free from any

construction by the owner, promoter or developer, and

what is more important, the manner in which the land

is to be provided for communal and recreational purpose

224

is that it is to be restricted at ground level in a

shape and location to be specified by the Chennai

Metropolitan Development Authority. This provision has

not been expressly challenged. In the absence of a

challenge, what is contained in a rule and also the

like provision in the regulation, the resultant

position would be the exact shape and the location is

to be determined by the CMDA.

163. The problem, however, still persists in the form

of the meaning of the words ‘communal and recreational

purpose’ in the case of a site having an extent between

3,000 square metres to 10,000 square metres. Rule 19

(b)(vi) to 19(2)(b)(vi) contemplate that the space so

required is to be transferred to the authority or local

body designated by the authority free of cost through

a deed. It is further provided that the local body may

provide the residents association or flat owners

association for maintaining such reserved space as

park. Significantly, in the case of a site having an

extent between 3,000 to 10,000 square metres, the Rule

declares that public access to the area as earmarked

will not be insisted upon. When it comes to the extent

225

of the site with which this Court is concerned, viz,

where the extent of site exceeds 10,000 square metres,

the requirement in the Rule, viz., is common to 10 per

cent of area excluding road had to be transferred by a

gift is insisted upon. It is provided that it is

obligatory to transfer the reserved 10 percent of the

site area. No charges can be accepted in the case of

new development or re-developments. It will be noticed

that in the case of Rule 19(b)(II)(vi) in the case of

site having extent between 3,000 square metres to

10,000 square metres, the CMDA or the local body may

permit the residents association or flat owners

association for maintaining the reserved space as

parks. In the case of site having extent of above 10,000

square metres under the column ‘reservation’, it is not

provided that the flat owners or residents association

may be permitted to maintain the reserved park.

However, it will be noticed that Rule 19(b)(II)(vii)

reads as follows: -

“(vii) The Authority reserves the right to

enforce the maintenance of such reserved lands

by the owner to the satisfaction of the

Authority or order the owner to transfer the

land to the Authority or any local body

226

designated by it, free of cost, through a deed,

the Authority as the case may be, reserve the

right to decide on entrusting the maintenance

work to institution/individual on merits of the

case.

Explanations under DCR 19 (b):-

(1) For Economically Weaker Section group

housing, the set back shall be 4.5 metre from

the site boundary and the spacing between the

blocks shall be a minimum of 3 metres. The

vehicular access way within the site shall have

a minimum width of 4.5 metres. Other

stipulations shall be as in rule 19(b) (II)

above. But, this shall be applied only in sites

duly declared for Economically Weaker Section

housing by Government.

(2) The corridor within the buildings shall be

accordance with the standard prescribed in

Annexure XII-A.

(3) In matter of standards other than specified

in these rules, the stipulation and the

specifications laid down by the Indian

Standards Institutions shall apply.

(4) Structures incidental to the main

activities such as water-closet, bath and pump

room shall not be construed as individual

blocks for the purpose of these rules. But,

these structures shall not be permitted in the

prescribed set back spaces.

III (a) Notwithstanding anything mentioned

above layouts for group housing, Economically

Weaker Section Housing, sites and services

projects, slum improvement schemes may be

approved, subject to such conditions as may be

stipulated by the Authority.”

227

164. The impact of Rule 19 (b)(II)(vii) is as follows.

It empowers the CMDA to enforce the maintenance of the

reserved areas by the owner to the satisfaction of the

authority or to order the owner to transfer the land

to the authority or any local body free of cost through

a deed. The authority also reserves the right to decide

on entrusting the maintenance work to

institutions/individual on the merits of the case. It

is noteworthy that there is no challenge to Rule

19(b)(II)(vii). It would appear that when a gift is

executed then the duty of maintaining can be given to

institution/individual on the merits of the case. This

would mean that even the project proponent or other

individual/individuals who may have an interest as in

the case of Vasant Apartments Owners Association, the

said Association could be asked to maintain the open

area.

165. The impression we gather on reading the contents

of reservation to be made in respect of site having an

extent between 3,000 to 10,000 square metres is that

the reserved area is to be maintained as a park. When

it comes to the site having more than 10,000 square

228

meters, the provision that public access for area shall

not be insisted upon is not to be found. This means

that when it comes to the layout which in the wisdom

and the policy of the Rule Maker, which as we have

seen, has been made after the process undergone under

the Act, as we have noticed, and apparently, after

hearing objections, if any, and with the approval of

the government that, were a large chunk of land be

developed for group development, as defined, and

certain percentage, which in these cases is 10 per cent

or 1/10th of the total layout excluding roads is to be

set apart as the OSR area. The word park is not in any

way inconsistent with recreational purpose. It does not

require much imagination to conclude that in an urban

area and with a site being in excess of 10,000 square

metres (nearly two and a half acres) where group

development takes place, there would be a large number

of people who would occupy the said area. Group

development can be substantially conflated with flats

and apartments comprised in two or more blocks or

buildings as required to satisfy the requirement of

group development under Rule 19(b)(II). A large number

229

of people would occupy the said land. This is

understandable having regard to the size of the layout

and the definition of group building. Planned

development, particularly, when it is informed by deep

vision about the future does call for an expansive

approach. Congestion in urban areas is a foreseen

certainty. The requirement for lung space and that too

the need for the same being available in the close

vicinity of the area of residents is not difficult to

conjure. Planned development has a considerable deal

to do with the quality of the lives of the residents

in an urban area, as can be perceived from provision

made for aspects relating to parking, setback, roads,

all of which do apparently make inroads into absolute

right of property of developer. They are indispensable

necessities from the standpoint of the town planner as

much as it is for the residents in an urban area. While

we are conscious of the fact that the DCR did

contemplate open space zones which must be understood

as parks, etc., as one of the zones, the idea,

apparently, was to avoid concentration and the

consequent need to undertake avoidable travel for the

230

residents of an area to the site of the open space

zone. An open space requirement is stipulated world

over based on very formidable considerations. The fact

that no construction is to be put up is the very

corollary of and is in consonance with an ‘open’ space

requirement. Still further, parks inevitably would have

trees. Trees ensures a steady supply of much needed

oxygen. Providing other recreational measures, which

are at the heart of quality of a person’s life, in

keeping with modern demands, are critical elements of

a legitimate public interest.

166. Having made these observations, we pass on to

consider further aspects. In the case of Vasanth

Apartments, i.e., Civil Appeal Nos. 1890-1891 of 2010,

the developer undoubtedly executed a gift deed. A

contention is taken on behalf of the respondents

including Shri Jayant MuthRaj that the donor has gifted

the land for roads and parks from the perusal of the

gift deed. It would appear that the donor has indeed

gifted the land in question and provided that the donee

may peacefully and quietly enjoy the said land ‘of

roads/parks’ free from all encumbrances. At this

231

juncture, we bear in mind the actual terms of the gift

deed executed in the case of Association of Vasanth

Apartments, which we have adverted to in paragraph-47

of this Judgment.

167. The Division Bench has considered the report of

the Advocate Commissioner also to find that there

existed a kachha pathway and that is a road which is

being used by thousands in terms of the gift deed which

came into effect. It is their contention that even if

it is found by this Court that in terms of the OSR

requirement of 10 percent of the land, it can only be

used as open space for communal and recreational

purpose and not for a road, this Court may not

interfere.

168. Firstly, we must consider the ambit of the words

communal and recreational purpose and find whether it

could take in a public road for being used by members

of the public generally. Equally, we must consider

whether the word communal is capable of extending the

benefit of the open space requirement to the members

of the general public or whether it must be confined

to the beneficiaries of the group development. In other

232

words, if the word communal is interpreted as the

community of the beneficiaries of the group

development, then it must be understood as meaning that

members of the general public cannot be permitted to

partake of the benefits flowing from the open space

reservation. For instance, if adjoining the site and

as indicated in the explanation in a shape and location

determined by the CMDA, a park is constructed. By use

of the word communal and interpreting it to mean a

community which is larger than the mere beneficiaries

of the group development as such, then the benefit of

the open space may become available to the general

public in the nearby area. This would have the

advantage of facilitating the members of the public

avoiding travelling to the areas where there is

recreation or open space, as for instance, under the

zoning requirements. Undoubtedly, the absence of any

construction which is indispensable to make it an open

space area and which is insisted upon also will provide

a large chunk of space for all the people in the area.

Making available the facilities on the basis that when

development is permitted, it brings in its train

233

certain responsibilities for the project proponents

which can be appreciated as legitimate State interests,

is one way of approaching the issue. It must be

understood in all these cases that setting apart of 10

percent of the area is actually as such not objected

to. This means all parties are agreed that the law

providing for setting apart of 10 percent of the total

area excluding roads in the case of group development

in excess of 10,000 square metres is legitimate and

valid, unless we find favour with the arguments that

it is otherwise constitutionally infirm. We have

already found that the provision does not offend

Article 14 on the ground that it represents a species

of class legislation. We are unable to also find that

the provision is manifestly arbitrary. If in other

words, there is no other basis to find the impugned

rule vulnerable, we can safely proceed to hold that the

requirement of OSR is not unjustified. We have noticed

the stand of the two appellants and the writ

petitioners also in this regard. We find that it is

their stand that they are prepared to maintain the 10

percent area as OSR. What is objected is to the

234

execution of the gift deed and allowing the property

rights to change hands. This is apart from the

objection to the chosen site being made accessible to

the general public.

169. We have noticed that in Pandit Chetram Vashishta

(supra), this Court has held that in the absence of

valid provision under which the gift in the said case

could be supported, the mere resolution was not

sufficient. The position still was found to be that the

original owner would continue to be a trustee. He

cannot transfer or change the nature of the property.

In fact, in the decision reported in Virender Gaur

(supra), this Court discountenanced conversion of what

was an OSR area into land on which construction though

for what was projected as a laudable object was carried

out. We are of the view that bearing in mind the

laudable object the law relating to town planning which

has been the very basis for our reasoning otherwise,

we must clarify that what the Rule and the Regulation

mandatorily stipulated was the dedication and

maintenance of 10 percent of the area for communal and

recreation purposes area only. There is inviolable duty

235

on the part of all including the local body and the

CMDA to ensure that an area which is set apart or

purported to be set apart in terms of the OSR

requirement under the Rule/Regulation in question is

used only for communal and recreational purpose. We

notice in, this regard, the complaint of Ms. V. Mohana,

learned Senior Counsel, as indeed the other counsel

that only lip service is being paid to the projected

sublime object of maintaining OSR. This cannot be

permitted.

170. Unrelentingly persevering is the aspect relating

to the contours of the word communal in the setting of

the Rules/regulations and Act. Rules do shed some light

in Rule 19 (b)(II)(vi). In regard to plots having a

size of 3,000 square metres to 10,000 square metres,

the law giver has provided that it shall not be

necessary to provide access to the public. When it

comes to the impugned Rule, viz., Rule 19 (b)(II)(vi)

providing for plot size in excess of 10,000 square

metres, it is apparent that the access of the members

of the general public to the OSR area is to be

permitted. This result is inevitable having regard to

236

the fact that unlike the immediate predecessors, viz.,

plot size having 3,000 to 10,000 square metres wherein

it has been indicated that public access shall not be

insisted upon such a relaxation is conspicuous by its

absence. The wisdom and the value judgement, which

underlies permitting or contemplating public access to

the OSR area, can be understood only in terms of the

difference in the size. Once wisdom and a value

judgment are beyond the pale of judicial review and

scrutiny, and further, it is found that the project

developer and also the beneficiaries of the group

development are duty-bound for maintaining an OSR area,

then the matter goes to the legitimacy of the public

or State interest. The consequences of executing the

gift deed and the underlying purpose have been adverted

to by us already. In fact, apart from it being a

legitimate public purpose, even the rough

proportionality concept in Nollan (supra) would appear

to be satisfied.

171. In the case of M/s. Keyaram Hotels Pvt. Ltd., the

terms of the gift deed provide that the gift is made

so that the donee may at all times, peacefully and

237

quietly, possess and enjoy the said portion only as

open space, free from all encumbrances, without any

lawful eviction, interruption, claim whatsoever from

the donor. A perusal of Rule 19 (b)(II)(vi) in relation

to the extent of size between 3,000 and 10,000 square

metres contemplates that the reserved area is to

maintained as a park.

172. We notice that under Rule 61 of the Andhra Pradesh

Group Development Scheme, sub-Rule (7) reads as

follows:

“61(7) Minimum of 10% of site area shall be

earmarked for organised pen space and be

utilised as greenery and shall be provided over

and above the mandatory setbacks at suitable

location accessible to entire community to the

satisfaction of the competent authority. Such

open space shall be open to sky and shall not

be over cellar floors.

(Emphasis supplied)

173. We may also notice sub-Rule 61(14):

“(14) All roads and open spaces mentioned in

this Rule shall be handed over to local body

at free of cost through a registered gift deed

before issue of occupancy certificate. The

society / association may in turn enter into

agreement with the local authority for

utilizing, managing and maintaining the roads

and open spaces. In case of any violation of

238

encroachment, the local authority shall

summarily demolish the encroachments and

resume back the roads and open spaces and keep

it under its custody.”

174. Under Regulation 23 of the DCR for Greater Bombay,

1991, open space is to be provided, in fact, for any

layout, starting from 1001 square meters to 2500 square

meters, wherein 15 per cent is to be kept as open space.

For an area of 2501 square meters to 10000 square

meters, 20 per cent has to be kept as open space. In

the case of residential and commercial layout for area

above 10000 square meters, ‘25’ per cent has to be

maintained as open space. There are certain exceptions.

The ownership, no doubt, is to vest by a deed of

conveyance in all the property owners on account of

whose holdings, the recreational space is assigned. It

also appears to provide that the remaining area of

recreational open space or playground (that is after

excluding structures providing for pavilions,

gymnasium, clubhouses, etc.), is to be made accessible

to all members as a place of recreation, garden or

playground.

239

175. The words ‘communal and recreational purpose’, for

which the OSR area is to be used, in the case of the

impugned Rule/Regulation, appears to indicate that the

word ‘communal’ is to be given a meaning, which would

be in keeping with the object of law, enable members

of the public as well, to gain access when the layout

is more than 10000 square meters. In this regard even

in Pt. Chetram (supra) we recapture the following:

“6. Reserving any site for any street, open

space, park, school etc. in a layout plan is

normally a public purpose as it is inherent in

such reservation that it shall be used by the

public in general. The effect of such

reservation is that the owner ceases to be a

legal owner of the land in dispute and he holds

the land for the benefit of the society or the

public in general. It may result in creating

an obligation in nature of trust and may

preclude the owner from transferring or selling

his interest in it. It may be true as held by

the High Court that the interest which is left

in the owner is a residuary interest which may

be nothing more than a right to hold this land

in trust for the specific purpose specified by

the coloniser in the sanctioned layout plan.

But the question is, does it entitle the

Corporation to claim that the land so specified

should be transferred to the authority free of

cost. That is not made out from any provision

in the Act or on any principle of law. …”

240

176. Rule 61(7) of the Andhra Pradesh Rules in Andhra

Pradesh, which we have referred to, is unambiguous that

the area used as ‘greenery’ shall be accessible to the

‘entire community’. It is to be secured by means of the

gift contemplated in Rule 61(14). While, we cannot be

sitting in Judgment over the said Rule, we would think

that the purport of the impugned Rule/Regulation must

be understood as persuading the Court to not place a

narrow interpretation.

177. In this regard we find reassurance in the view

taken by the courts in the United States even in the

presence of the taking clause under the 5th Amendment

to the U.S. Constitution. In an Article titled

“Techniques for Preserving Open Spaces” published in

75 Harv. L. Rev. 1622, we find the following:

“Required Dedication and Reservation. — A

municipality can require the developer of a new

subdivision to provide such facilities as

roads, streets, sewers, and playgrounds as a

condition to plat approval. In the leading case

of Ayres v. City Council a requirement that the

subdivider dedicate land for road and street

purposes and leave undeveloped an accompanying

area for trees and shrubbery was approved on

the theory that since the new subdivision

created the need for and would specially

benefit from the improvements, the developer

and ultimate purchasers rather than the entire

241

community should bear the cost of providing

them. In a case involving required reservation

of land for a public park the argument that

this would be an unconstitutional taking of

land was rejected on the theory that the

subdivider would be compensated by the share

of the benefits to the whole community which

accrued to his particular development. The

Pennsylvania Supreme Court has taken a contrary

view, however. And where the need for a

particular improvement is a general one, not

specifically attributable to the subdivider's

activity, the entire municipality must bear the

cost.”

We would therefore come to the conclusion that the

word ‘communal’ must be understood as where the layout

exceeds 10000 sq.meters entitling members of the

general public also to avail the benefit of the OSR

area. Once, the word ‘communal’ is so understood it

further fortifies us in our conclusion that there would

be no infraction of Article 300A or Article 14 as

understanding the execution of the gift deed as

obligating the donee only to act as a trustee to ensure

the fulfilment of the sublime goal of the law and since

the owner/developer would not have a right to exclude

others or to claim exclusive right to possession which

would be incongruous to recognising the right of the

members of the general public to access to the OSR

242

area. This discussion furnishes our rationale to

uphold the Rule / Regulation and to hold that it can

withstand the challenge based on Article 300A on the

basis that properly appreciated the “so called

compelled gift” would be valid. Even proceeding on the

basis that a challenge to Rule 19(b) would imply a

challenge to the Explanation as well, on the reasoning

which has appealed to us, namely, about the nature of

the right under the Gift Deed as also finding that the

word ‘communal’ is intended to reach the benefit of

the OSR area to the members of the public as well,

there would be no merit in the contention.

THE UPSHOT OF THE ABOVE DISCUSSION:

178. The upshot of the above discussion may be summedup as follows:

I. Rule 19 of the DCR, which is impugned, is statutory

in nature;

II. Rule 19 is not ultra vires the Act;

III. The impugned Regulation is not ultra vires the Act;

243

IV. Neither the impugned Rule nor the Regulation

violates Article 14 of the Constitution of India;

V. The impugned Rule/Regulation does not violate

Article 300A of the Constitution of India;

VI. The areas covered by the OSR cannot be diverted

for any other purpose. The respondents are dutybound to ensure that the area set apart as OSR is

stringently utilised only for the purpose in the

Rule/Regulation. We direct that no area meant for

OSR shall be utilised as dumping yards or any other

purpose other than as OSR;

VII. As far as Civil Appeal Nos. 1890-1891 of 2010 are

concerned, we are of the view that in view of the

fact that there appears to have been a kachha road,

even at the time of the gift executed as early as

in February, 1994 and it was being used as a road

by large numbers of members of the public to

reverse the position on the ground, may produce a

great deal of injustice, which we would avoid by

resorting to the principle enunciated in the

decision of this Court referred to in

244

Taherakhatoon (D) By LRs. v. Salambin Mohammad70.

However, if the property gifted is in excess of

the area used for the road, we direct that the

excess land shall be used for the purpose of OSR

only. We also direct that the Authority may

consider making available the maintenance of the

said area to the appellants, namely,

Association of Vasanth Apartments Owners, if they

are prepared to maintain it in terms of the

observations contained in this judgment.

179. Civil Appeals 1890-1891 of 2010 are disposed of.

The other Appeals and the Writ Petition will stand

dismissed subject to the observations/directions we

have made earlier. No order as to costs.

………………………………………………………………………J.

[K.M. JOSEPH]

………………………………………………………………………J.

[PAMIDIGHANTAM SRI NARASIMHA]

NEW DELHI;

DATED: February 13, 2023.

70 (1999) 2 SCC 635

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ASSOCIATION OF VASANTH APARTMENTS’ OWNERS VERSUS V. GOPINATH & ORS

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