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Karnataka High Court dismisses PIL against transfer of industrial plot

The Karnataka High Court has held that for the purpose of claiming a writ of mandamus, the petitioner must establish an existing legally enforceable right, its infringement or invasion or infraction. Exercise of the jurisdiction to issue a writ of mandamus is purely discretionary and the same cannot be issued as a matter of course.

The Division Bench of Acting Chief Justice Alok Aradhe and Justice S. Vishwajith Shetty dismissed a Public Interest Litigation (PIL) filed by one Amruthesh NP filed seeking a direction to the respondent authorities to consider the representation of the petitioner dated 16.01.2021 and also to prevent sale of 41 acres of land granted by respondent no.3 (Karnataka Industrial Areas Development Board) to respondent no.4 (Limited Company) and to restore the said land allotted to respondent no.4 and allot the same to new entrepreneurs, manufacturing units or use the same as a major lung space of the locality.

The brief facts of the case are that in 1972 respondent no.3 had allotted an extent of 43 acres 33 guntas of land to respondent no.4 herein in Plot of Doddanekkundi village, K.R.Puram Hobli, Bengaluru District (‘Schedule Property’), for the purpose of establishment of an industrial unit and the Board had put respondent no.4 in possession of the Schedule Property and an allotment letter as well as Possession Certificate was also issued. Subsequently, in the very same year, a lease-cum-sale deed was also executed by the Board in favour of respondent no.4 in respect of the Schedule Property. In 1973, respondent no.4 established a graphite plant industry in the Schedule Property after obtaining the required permissions and consents from all the concerned authorities. In 1987, respondent no.3 had executed an absolute sale deed in favour of respondent no.4 in respect of the Schedule Property and ever since the said sale deed dated 24.04.1987, respondent no.4 has been the absolute owner in possession of the Schedule Property.

In 2012, complaints were received by the Karnataka State Pollution Control Board against respondent no.4 on the ground that respondent no.4 was polluting the environment, and accordingly, the Control Board refused to renew the consent order issued by it for operation of respondent no.4’s industrial unit. A closure order was also consequentially issued by the Control Board directing respondent no.4 to close down its activities in the Schedule Property and the said order was questioned in appeal by the Control Board. The Appellate Authority had allowed the appeal and the said order of the Appellate Authority was challenged by the complainants/respondents of the locality before the National Green Tribunal (NGT) and the order passed by the Appellate Authority was set aside by the Tribunal.

It is under these circumstances, respondent no.4 had closed industrial operations in the Schedule Property in 2019 and had sought permission of the State Government in terms of Section 25(o) of the Industrial Disputes Act, 1947, for closure of the industry. The State Government on 28.06.2019 had granted permission to respondent no.4 to close down its industrial unit, and subsequently, respondent no.4 had settled dues of all its employees who were working in the industry as on the date of closure. Thereafter, this writ petition was filed in 2021 alleging that respondent no.4 was trying to dispose of the Schedule Property for commercial purposes.

While considering the PIL, the Bench noted that the Schedule Property was acquired by respondent no.1 (Chief Secretary, State of Karnataka) under the provisions of the Act of 1966 and Section 28 of the said Act provides for acquisition of land by the State Government for the purpose of development by the Board or for any other purpose in furtherance of the objects of the Act of 1966. On such acquisition, the lands vest in the State Government. Section 28(8) of the Act of 1966 provides that the State Government after acquiring and taking possession of the land acquired for the purpose of the Board, may transfer the land to the Board for the purpose of which the land has been acquired. Section 32 of the Act of 1966 specifies that the State may place at the disposal of the Board any land vested in the State Government and after such land has been developed by the Board, it shall be dealt by the Board in accordance with the Regulations made or directions given by the State Government. Section 41 of the Act of 1966 provides the power for the Board to make regulations consistent with the Act with the prior approval of the State Government.

In exercise of the powers under Section 41(2)(b) of the Act of 1966, the Board has framed the Karnataka Industrial Areas Development Board Regulations, 1969. From a perusal of the said Regulations, it is clear that the Board has the power to execute the lease-cum-sale deed as well as the absolute sale deed in favour of the allottee of the land.

Regulation 4 provides for applications for allotment of land in an industrial area, while Regulation 5 empowers the Board to decide the manner of disposal of land in each industrial area whether by lease, lease-cum- sale, sale, auction sale, etc. Regulation 10 empowers the Board to make an allotment in favour of an applicant. Form Nos.4 & 5 set out in the Regulations specifies the form of lease-cum-sale agreement and form for sale of industrial plot in favour of the applicant after he sets out the project and fulfills all the conditions of the lease-cum sale., the Bench observed.

From a conjoint reading of the provisions of the Act of 1966 and the Regulations of 1969, the Bench noted that the land acquired under the Act of 1966 vests with the State Government and the State Government may transfer the land to the Board for the purpose for which the land has been acquired and after the land is developed by the Board it shall be dealt with by the Board in accordance with the Regulations. Under the Regulations of 1969, the Board is empowered to allot the land developed by it to the applicant either by leasecum-sale, sale or auction sale. Therefore, we find no merit in the contention of the petitioner that the acquired land/schedule property which vested with the Government and was transferred to the Board for the purpose of development, cannot be leased out or sold to any party by the Board.

Further the Court held that it is not the case of the petitioner that the Schedule Property was not utilized by respondent no.4 for the purpose for which it was allotted to it. Undisputedly, respondent no.4 had established an industry in the Schedule Property which had functioned for nearly about 46 years. The absolute sale deed executed in its favour is without any restriction on utilization of the land and even if there is any restriction, the same would be void under Section 11 of the Transfer of Property Act, 1882. Under the circumstances, we are of the considered view that the several prayers made by the petitioner for issuing a writ of mandamus including the writ of mandamus directing respondent no.3 to reacquire the Schedule Property and allot it to upcoming entrepreneurs, or to use the Schedule Property as a lung space of the locality, cannot be granted.

“The petitioner herein has failed to establish any existing legally enforceable right or its infringement for claiming a writ of mandamus. Petitioner has also not established that the respondent authorities have refused or neglected to perform their statutory duties. When the petitioner has failed to establish any legally enforceable right or its infringement and when he has also failed to point out that the respondent-authorities have failed or neglected to perform their statutory duties, the prayers made by the petitioner for issuing writ of mandamus cannot be granted,” the order reads.

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