Holding

The Government order is directory, not mandatory; NOIDA retains its statutory power to acquire land under the Land Acquisition Act and to refuse development permission and alter the master plan within its statutory authority.

Summary

The petitioners, a cooperative housing society, applied to the New Okhla Industrial Development Authority (NOIDA) for permission to develop their land under the Authority's building bye‑laws, but NOIDA refused, citing its statutory duty to prepare a master plan for the industrial‑urban township. While the writ petition was pending, the Government issued a G.O. on 9 April 1980 stating that lands of cooperative house‑building societies should not be acquired "as far as may be," which the petitioners claimed barred NOIDA from acquiring their land. The Supreme Court held that the G.O. was merely a directory administrative instruction, not a mandatory statutory order, and therefore did not curtail the Government’s power to acquire land under the Land Acquisition Act, 1894. The Court further held that NOIDA’s refusal to grant development permission and its alteration of the master plan to re‑classify the land were within its implied powers under the U.P. Industrial Development Act, 1976 and were not arbitrary or discriminatory. Consequently, the appeal and the writ petition were dismissed with costs.

Issues considered

The legal effect of the Government order dated 9 April 1980 on the authority's power to acquire land of cooperative housing societies.
Whether NOIDA could lawfully refuse permission to the society to develop its land under the building bye‑laws.
Whether the alteration of the master plan to change the land's designated use was arbitrary, discriminatory, or violative of Article 14.
Whether the Government order is mandatory or merely directory and its impact on the Land Acquisition Act, 1894.

Legislation cited

Land Acquisition Act, 1894s. 17, s. 4(1), s. 5
U.P. Industrial Development Act, 1976s. 12, s. 3, s. 6, s. 8
U.P. Urban Planning and Development Act, 1973s. 41

Subjects

Land acquisitionIndustrial development authorityCooperative housing societyGovernment orderAdministrative instructionPlanned developmentArticle 14Building bye‑lawsMaster plan alteration

Judgment

A KENDRIY A KARAMCHARI SAHKARI GRIH NIRMAN
SAMIT! LTD. & ANR.
v.
NEW OKHLA INDUSTRIAL DEVELOPMENT AUTHORITY
& ORS.

B OCTOBER 28, 1987

]B.C. RAY AND K. JAGANNATHA SHETTY, JJ.] >-
U.P. Industrial Development Act, 1976: Secs. 3, 6, 8 and
12-New Okhla Industrial Development Area-Development
C of-Acquisition of lands owned by Group Housing Societies-G.O. ~
dated 9.4.1980---Nature and effect of-Lands of Cooperative House
Building Societies not to be acquired 'as far as may be'-Whether
~directory/mandatory-Building Bye-Laws 1977-New Okhla Indus-
trial Development Authority-Refusal of permission for development
of land of Housing Society-Validity of.
D
The U.P. Industrial Development Act, 1976 was enacted to pro-
.. vide for the constitution of an Authority for development of certain
areas in the State into industrial and urban township. By a notification
dated 17.4.1976 the "New Okbla Industrial Development Authority was
established and "New Okbla Industrial Development Area" was ~'
E declared.

New Okbla Industrial Development Authority made the Building
bye-laws, 1977, and the Authority in 1978 prepared a plan wherein the
land of the Society was earmarked as 'low density residential area'. -
F The appellant-Society submitted an application on March 14,
1978 with a plan for approval and permission to develop its land. By
letters dated 12th June/3rd July, 1978 and 22.11.1978, Respondent No.
1 intimated the appellants that permission had been refused for
development of the land and that the entire land of the Society had not
G been acquired.

The appellants filed a writ petition before the High Court, assail·
ing refusal of permission without recording proper and germane
reasons, and praying for direction to respondents not to acquire the
lands belonging to the Society, and to permit its development according
H to the lay out plan submitted by it.
662
K.K. SAMm v. NEW OKHLA !NOL. AUTH01l-ITY 663

The High Court granted an interim order of stay of dispossession. . A

During the pendency of the writ petition a G.O. dated 9.4.1980
was issued iniimating that the Government had decided that the lands
acquired by those Co-operative House Building Societies, which
satisfied the conditions laid down therein should not he acquired as far
as~k B

The appellants' representation for reconsideration of the matter
in the light of the above Government order was rejected, on the ground
that the G.O. was an administrative Instruction and could not be con-
strued as mandatory, that the Government's power to acquire land for
public purposes under the Land Acquisition Act, 1894 was not pro-
hibited, and that the object of the Act, to ensure planned development C
of the area for industrial and urban township would be frustrated, if
individual societies were permitted to develop their lands themselves.

The High Court dismissed the writ . petition holding thai the
D
Government's orders dated July 27, 1967 and April 9, 1980, having
not mentioned the Chief Executive Officer, New· Okhla Industrial
Development Authority; the intention of the State Governmenf was to
exclude the Chief Executive Officer, New Okhla Industrial Develop-
ment Authority from its application, that on the basis of these G. Os.
the appellants could not claim exemption from acquisition hy New Okhla
Industrial Development Authority under the provisions of U.P. Act VI, E
1976. ..

Aggrieved by the order of the High Court, the appellan~ f"lled a
special leave petition before this Court, and also a writ petition chal-
. Ienging the validity of the change made by New Okhla Industrial De-
~ . velopment Authority during the pendency of the Writ Petition in the F
( Master Plan by showing the appellant's land as Regional Park.

Dismissing the appeal by special leave, and the writ petition,
(

HELD: 1.1 The sole object of the 1976 Act is to develop certain G
areas in the State into industrial and urban township in a planned way
by the Authority constituted under the Act and as such the cooperative
societies cannot be permitted to develop their lands for the purpose of
building houses haphazardly. This will frustrate the entire object of the
Act. The Government has power to acquire land for public purposes
under the Land Acquisition Act, 1894. [669B-D] ·H
664 SUPREME COURT REPORTS [ 1988] 1 S.C.R.

A 1.2 The application of the appellant-Society was duly considered
and the Authority refused permission on their application for relevant
and .c~gent reasons. [670B] · ·

·- 1.3 The G.O. dated 9.4.1980 merely states that the lands ot
Co-operative House Building Societies are not to he acquired "as far as
B may be". Hence the order is only directionary and cannot he considered
to be mandatory. Moreover, this order is not a statutory one, being not
issued under any .statutory provision. It is at best an administrative ~
instruction. It does .not create an express bar on the power of the
Government to acquire the land for public purposes under the Land
Acquisition Act. [669A-B]
- -·_ ; . ., ~- - . ' . .
<;:: · · •1.4 The Authority; .which has been given the power under the --.t'
Statute to prepare the development plan demarcating therein the sites . \..
· to be developed for development of industrial, residential and other
purposes for planned development of the industrial and urban town-
ships, has necessarily the implied power to alter or modify the Plan
· D showing the land meant for the particular user. Change of user of the
land by altering the plan is not arbitrary because it is for the Authority
to determine and demarcate the site to be developed and used for a
particular purpose to secure planned development of the industrial
to\vnship. The plan was based on the recommendations of the Expert
Committee which were approved by the State Government. The altera- _)...
E lion· in the· user of appellant's· land does not lead to· any hostile
· · descrimination. [670E-H] ·
'
1.5 A proposal for acquisition of 325-353 acres of land in the
village in which the appellant Society's land is situated was sent to the
Collector, who agreed to it and after approval from Government, sent a
F notification under section 4(1) of the Land Acquisition Act to Govern- .
ment Press for publication. A Draft for Rs. 70 lakhs, being the approxi-""""'
mate amount of 20% of compensation, has been sent to Collector by the J
Authority. In the circumstances, it cannot he said that no steps have
· been taken by the New Okhla Iiidustrial Development Authority to
acquire the Society's laud. The question of allotment of alternative sites
(; to the members of the society does not arise as the lands of the society
have not yet been acquired. [671C-F]

-....:..... .ORIGINAL/CIVIL APPELLATE JURISDICTION: Writ
Petition No. 557 of 1983 etc.

H . (Under Article 32 of the Constitution of India)
~.K. SAMIT! v. NEW OKHLA INDL. AUTilORITY (RAY, J.) 665

V.M. Tarkunde, A.K. Sen, S. Markandeya and N.D.B. Raju for
A
the Petitioners.

S.N. Kacker, Raju Ramachandran and Mrs. Shobha Dikshit for
the Respondents.

The Judgment of the Court was delivered by B

B.C. RAY, J. This civil appeal by special leave is directed
against the judgment and order passed by High Court, Allahabad
dismissing the writ petition filed by the Co-operative Housing Society
formed as Kendriya Karamchari Sahkari Grih Nirman Samiti Ltd. and
its President challenging the order of refusal of permission to the lay C
out plan sub11!itted by them to the New Okhla.Development Authority
to be hereinafter referred in brief as NOIDA and also refusing to
exempt the lands belonging to the Society falling within NOIDA Area
from acquisition. The facts giving rise to this appeal are shortly as
follows:-
D
The U.P. Industrial Development Act, 1976 was enacted with
the object to provide for the constitution of an Authority for
development of certain areas in the State into industrial and
urban township. This Act came into operation from April 16.
1976. A notification No. 4157-HXiXVIII-II dated 17.4.1976 was
published constituting under Section 3 of the said Act the "New E
Okhla Industrial Development Authority" and declared the

- industrial development area comprising of 37 yillages mentioned
in the schedule to be "New Okhla Industrial Development
Area". In the said schedule item No. 16 referred to viUage
Chhalera Bangar wherein the Society's lands are situated. Sec-
tion 6(2) of the said Act empowers NO IDA to acquire land in the F
industrial development area either by agreement or through
proceedings under the Land Acquisition Act, 1894. It also con-
fers powers on the Authority to prepare a plan for the develop-
ment of industrial development area and to lay down the purpose
~or whi~h a particular site on plot of land shall be used namely for
mdust.nal. commercial or residential purpose or any other G
specified purpose in the area. Section 8 confers power on the
;\uthority to issue directions in respect to matters specified there-
m for erection of building. The NOIDA made certain direc-
tions under the nomenclature of Building bye· laws, 1977. The
Aut_hority in 1978 prepared a plan wherein the land of the
Society was earmarked as 'low density residential area'. The ap- H
666 SUPREME COURT REPORTS [1988] 1 S.C.R.
'
pellant society submitted an application on March 14, 1978 with
plan for approval and permission to develop the land to NO IDA
in accordance with the provisions of Building Bye-laws. The
Society on June 14, 1978 has sent a letter to NO IDA intimating
that no order was made in respect of the development plan sub-
mitted by them till that date and if no order is made by the
B Authority within a period of 20 days of this letter the Authority
shall be deemed to have permitted the proposed work in accord-
an~e with Bye-law No. 8.2 framed by the Authority. On 12th
June13rd July, 1978 the respondent No. l, the Chief Executive
Officer, NO IDA intimated the appellant No. 2, President of the
Society that permission has been refused for development of the
land by the Society according to the plan submitted as it is the
c function of the Authority to prepare plan for development of its
industrial development area, to demarcate and develop sites for
industrial, commercial and residential purposes according to the
plan and to provide amenities for planned development of the
area.

On 22.11.1978 NOIDA replied to the letter of the appellants
dated 19.11.1978 stating thai the entire land of the Society has not
been acquired. The area falling within the urbanised limits is to be
acquired to check the unauthorised development on either side of the
DSC road and to have land for widening of the DSC. For these
E reasons, it is not possible to approve the lay out plan submitted by the
appellant society.

The appellants an April 28, 1979 filed a writ petition before the
High Court, Allahabad assailing the refusal of permission as contained
in letters dated 3.7.1978 and 22.11.1978 without recording proper and
F germane reasons and praying for a writ or order or direction quashing '
-
the said letters and for a suitable writ or order or direction command- ~.·
ing the respondents not to acquire the lands belonging to the Society.
The petitioners further prayed for issue of a writ or order or direction
directing the respondent No. 1, NOIDA to permit the Society to
develop its land according to lay out plan submitted by it.

On 3.7.1979, the High Court granted an interim order of stay of
dispossession. By order dated 23.8.1979, the Court directed that the
said interim order would continue until further orders.

During the pendency of the writ petition the G.O. No. 1634/37-
H 2-8a29 H.B./79 dated 9.4.1980 has been issued intimating the authorities
K.K. SAMffi v. NEW OKHLA INDL. AUTIIORITY [RAY, J.] 667

mentioned therein that the Government after reconsidering the ques-
--r lion of acquisition of the lands acquired by the Co-operative House
A
Building Societies has decided that it is not desirable that the lands of
such Co-operative House Building Societies are acquired by the U.P.
Housing and Development Board, Development Authorities etc. It
has also been stated therein that keeping in view the above factors the
lands of the Co-operative House Building Societies who satisfy the B
conditions laid down therein should not be acquired as far as may be .
........ The petitioner made a representation to the Chief Executive Officer,
NO IDA to take into consideration the above government order and to
sanction the plan for development submitted by them. A supplement-
"" ary affidavit has also been filed in the writ petition. The High Court on
22.12.1980 observed that the respondent was expected to give his de-
tailed reasons for refusal of permission to the application filed by the
c
~
Society within a month or so.

Pursuant to the above order the Chairman and Chief Executive
Officer, NOIDA by its letter dated 23.1.1981 intimated the President
of the Society that it was not possible to sanction the Society's lay out D
plan. NOIDA published a notification in Newspapers including "Nav
Bharat Times" in its issue elated June 4, 1980 stating that there is total
prohibition of sale or purchase of land acquired in favour of NO IDA
and any construction work is totally prohibited. It was further
-.____,. mentioned that in the n<1tifiecl area the building construction must be
in accordance with the rules made and directions issued by NOIDA E
and not otherwise.

- On August 13, 1981, NO IDA sedt a letter to the President of the
petitioner Society stating that the G. 0 dated 9.4.1980 is an administra-
tive instruction and it cannot be construed as mandatory. Upon its
basis it cannot be said that the Government's power to acquire land for F
-~ public purposes under the Land Acquisition Act, 1894 is prohibited.
The object of the Act is to ensure planned development of the Area
for industrial and urban township. If individual societies are permitted
to develop their lands themselves there shall be chances of haphazard
growth in the area and it will not be possible to ensure a proper
industrial and urban township in the different sectors according to G
Master Plan. For these reasons, it is not possible for the Authority to
permit the Society to develop its land for residential purposes. The
~ application has therefore, been rejected.

After hearing the parties the said writ petition was dismissed
with costs by the High Court, Allahabad holding inter alia that the H
668 SUPREME COURT REPORTS [1988) 1 S.C.R.

A Government orders dated July 27, 1967 and April 9, 1980 having not
mentioned the Chief Executive Officer, NOIDA, the intention of the
State Government was to exclude the Chief Executive Officer,
NOIDA from its application, that on the basis of these CT.Os. the
petitioners could not claim exemption of their land from acquisition by
NO IDA under the provisions of U.P. Act VI of 1976, that the permis-
B sion was clearly refused by NOIDA to the plan submitted by the
petitioner with his application for permission and there was no scope
for deemed sanction. It was further held that there was no promissory
estoppel.

The appellants feeling aggrieved by this judgment and order pre-
C ferred the instant application for special leave to appeal before this • \
Court. During the pendency of the writ petition before thF High Court ./<
NOIDA made a change in the Master Plan by showing the arell' in -
which petitioner's land is situated as agricultural land i.e. Regic;mal
Park. The appellants filed a writ petition No. 557 of 1983 in this Court
challenging the validity of the plan and for a writ or order or direction
D for quashing the revised "Master Plan".

From the arguments advanced by the learned counsels for the
parties the following points arise for consideration of this Court:- ·

The first point urged before this Court is that the G.O. dated
E July 27, 1967 and the G. 0. dated 9 .4. 1980 which was in continuation
of the earlier G.O. dated 27.7.1967 imposes a ban on NOIDA to
acquire the land of the Co-operative House Building Societies who
satisfy the conditions mentioned in the G.O. dated 9.4.1980. It has
been submittied that under section 12 of the said Act No. IV of 1976;
the provisions of certain sections including Section 41 of the U.P.
F Urban Planning and Development Act, 1973 as re-enacted and modi-
fied shall mutatis mutandis apply to the Authority. Clause (c) of
Section 12 specifically states that any reference to the Vice-Chairman
of the Authority shall be deemed to refer to the Chief Executive
Officer of the Authority. The said Government order will apply to
NO IDA and the lands of the appellant society which is a co-operative
G house building society, cannot be acquired in view of the said Govern-
ment orders. This contention is not sustainable for the reasons stated
hereinafter. Under .Section 12(c) of the said Act the Government
order is to be deemed to have been addressed to the Chief Executive
Officer, NOIDA as the same was addressed to all Vice-Chairmen,
Development Authorities, U.P. Section 41 enjoins the Authorities to
H comply with the directions contained in the Government order. The
K.K. SAMIT! v. NEW OKHLA INVL. AUTHORITY [RAY, J.) 669

G.0. dated 9.4.1980 merely states that the lands of Co-operative
~
House Building Societies are not to be acquired "as far as may be". A
This Government order cannot be considered to be mandatory but
directory in as much as it merely says that the lands of co-operative
house building societies should not be acquired as far as may be.
Moreover this order is not a statutory one being not issued under any
statutory provision. It is at best an administrative instruction. The B
contention that this order creates an express bar on the power of the
-z Government to acquire lands of co-operative house building societies
is without any substance. The sole object of the 1976 Act is to develop
certain areas in the State into industrial and urban township in a plan-
ned way by the Authority constituted under the Act and as such the
co-operative societies cannot be permitted to develop their lands for
the purpose of building houses haphazardly. This will frustrate the c
A entire object of the Act. The contention that the lands of the societies
are exempted from acquisition cannot be sustained being devoid of any
merit. The Government has power to acquire land for public purposes
under the Land Acquisition Act, 1894.
D
It has been urged that in accordance with bye-law 5.2 framed by
the Authority under Section 8 of the said Act, the appellant society
submitted an application on March 14, 1978 for development of their
land to the Authority to accord sanction to the lay out plan and to
permit the Society to develop the land. As no order was communicated
~-r the appellants sent a notice to the Authority drawing the attention of E
the Authority that if no order was made within 20 days of this letter
then the Authority would be deemed to have permitted the proposed
... work. This letter was dated 14.6.1978 and the Authority by its letter
dated 3.7.1978 intimated the appellant society that since NOIDA has
been empowered to prepare a plan for planned development of its
industrial development area by demarcating sites tor industrial, F
~
commercial and residential purposes according to plan and to provide
for infrastructures for these purposes to secure planned development,
permission cannot be granted to the application for development of
the area by the society. The Deputy Chief Executive Officer also sent
another letter to the President of the Society on 22.11.1978 intimating
that the Society had already been informed that the case submitted by G
it for sanction of the scheme for development of land in village Chall-
era Bangar cannot be entertained. Again pursuant to the order of
"'-\ court made in writ petition No. 4220 of 1979, the respondent Authority
by letter dated August 13, 1981 intimated the Society the detailed
reasons for refusal of permission to the plan submitted by the appel-
)ant society to develop its land as it will frustrate planned development H
670 SUPREME COURT REPORTS [1988) I S.C.R.

of the industrial development area into industrial and urban town·
A r-
ships. The contention of the appellants that their application for
permission to develop has been rejected on extraneous consideration
and not for germane reasons is not at all tenable. The application was
duly considered and the Authority refused permission on their applica-
lion for relevant and cogent reasons.
B
It has been contended that in the first Master Plan the lands of
the appellant's society were shown to be situated in low density resi- )--

-
dential area. This Plan has been altered unilaterally by showing it as
agricultural land. Thereafter this land was shown as Regional Park in
the Master Plan. It has been submitted that this alteration or modifica-
tion in the Plan has been made with a view to defeat the petitioners'
c claim for immunity from acquisition. This alteration in the Plan is
arbitrary in as much the appellants have not been given any opportun- J-~
ity to file objections against such alteration. In no other area the
NOIDA Authority has altered its plan. The appellants have been sing·
led out for hostile discrimination contrary to Article 14 of the· Con-
D stitution. Under Section 6(2) of the Act the Authority has to prepare a
Plan for the development of the industrial development area and to
demarcate and develop sites for industrial, commercial and residential
purposes, to lay down the purpose for which a particular site or plot of
land shall be used namely for industrial, commercial and residential
purpose or any other specified purpose in such area. The Authority
prepared the Plan showing therein the sites for residential and other ')....-/
E
purposes. The Authority which has been given the power under the
Statute to prepare the development plan demarcating therein the sites

F
to be developed for development of industrial, residential and other
purposes for the planned development of the industrial and urban
townships has necessarily the implied power to alter or modify the
Plan showing the land meant for the particular user. The submission I
-
that the change of user of the land by altering the plan is arbitrary is
without any substance in as much as it is for the Authority to -~
determine and to demarcate the site to be developed and used for a
particular purpose to secure planned development of the industrial
township. It appears from the counter affidavit filed on behalf of the
G respondents to the writ petition that the Plan was formulated and it
was approved by the Authority in 1979. The Plan was based on the
recommendations of the Expert Committee and the recommendations
were approved by the State Government. The other submission that
this alteration in the user of appellants' land in Plan leads to ho$1ile
r
discrimination is also without any substance as we have held hereinbe-
H fore that the G.O. dated 9.4.1980 does not in any way create any
K.K. SAMIT! v. NEW OKHLA INDL. AUTHORITY [RAY. J.J 671

......,.. embargo on the power of the Government to acquire the land for A
public purposes under the Land Acquisition Act.

It has been submitted in this connection that the Authority
(NOIDA) has not taken any steps to acquire their land and also has
not taken any steps to provide their members with alternative sites.
B
This submission also has got no merit in as much as the appellants filed
a writ petition before the High Court on April 28, 1979 praying for a
·-...4.. writ or order or direction commanding the respondents ndt to acquire
the land belonging to them. An interim order of stay was obtained
from the Court and it continued till the dismissal of writ petition. A
" special leave petition out of which this appeal arises has been filed and
an order of stay of dispossession has been obtained from this Court. c
~- The stay is continuing. It is pertinent to mention in this connection that
a proposal for acquisition of 325.353 acres of land in village Challera
Bangar, Pargana and Tehsil Dadri, District Gaziabad was sent by
NOIDA to the Collector, Gaziabad on 11.2.1985. The Collector after
examining the proposal agreed to the same and requested the Govern-
men!, Industries Department to issue notification under Sections 4, 5 D
and 17 of Land Acquisition Act, 1894. The Government however,
felt that there was no necessity to issue notification under Section
17 of the Land Acquisition Act. Accordingly, notification under
section 4(1) was prepared and sent to Government Press, Lucknow on
'·'----1 11.3.1987. The Authority has sent a sum of Rs. 70 lakhs by draft to the
Collector being 20% of the approximate amount of compensation. On E
31.7.1987 NOIDA sent a letter requesting the Government Press to
expedite publication of Notification issued by the Collector, Gaziabad.
,. This is evident from the counter-affidavit of Tehsildar, Udai Singh. In
these circumstances it is futile to contend before this Court that no
steps have been taken by NOIDA to acquire appellants' land. The
question of allotment of alternative sites to the members of the Society F
_-( does not arise as their lands have not yet been acquired.

For the reasons aforesaid, the appeal and the writ petition are
dismissed with costs.

N.P.V. Appeal & Petition dismissed. G