Holding

The BDA possessed unrestricted authority under Section 38 to transfer the land, the allotment was not a bulk allotment under Section 38‑B, and the High Court erred in holding otherwise.

Summary

The Supreme Court examined whether the Bangalore Development Authority (BDA) could lawfully sell a 1‑acre‑20‑guntas plot to Printers (Mysore) Ltd. for setting up a printing industry. The Court held that Section 38 of the BDA Act confers unrestricted power to lease, sell or transfer property unless specific restrictions are prescribed, and that no such restrictions applied in this case. It further ruled that the allotment did not constitute a "bulk allotment" under Section 38‑B, which is limited to transfers to specified governmental bodies. Consequently, the High Court’s finding that the allotment violated the Act was a manifest error. The appeal was allowed, the writ petition dismissed, and the sale deed upheld.

Issues considered

Whether the BDA had power under Section 38 of the Bangalore Development Authority Act to sell the plot without any prescribed restrictions.
Whether the allotment of 1 acre 20 guntas qualifies as a "bulk allotment" under Section 38‑B of the Act.
Whether the rules framed under the Act (Allotment of Sites Rules, etc.) limited the Authority’s power in this transaction.
Whether the public interest litigation was maintainable given the delay and laches.
Whether land earmarked for housing could be allotted for industrial purposes.

Subjects

Bangalore Development Authority ActSection 38bulk allotmentpublic interest litigationland alienationstatutory interpretationsubject todevelopment schemeindustrial landdelay and laches

Judgment

\

~

,.•
THE PRINTERS (MYSORE) LTD. A
v.
M.A. RASHEED AND ORS.

APRIL 5, 2004

[V.N. KHARE, CJ., S.B. SINHA AND S.H. KAPADIA, JJ.] B

Bangalore Development Authority Act; Section 38:,

State-Authority sold a plot of/and to a company for establishing printing
industry-Challenge to-Allowed by High Court holding that the Authority c
made allotment in bulk in contravention of the provisions of the Act-letters
Patent Appeal dismissed by the High Court-On appeal, Held: In the absence
of any restriction/condition/limitation on the authority concerned in selling/
transferring the property, the Authority possess power. to sell/transfer the
plot-Allotment of the plot measuring I acre 20 gunthas cannot be termed as
bulk allotment-Extent of land sought to be allotted must be commensurate
D
'~ . wilh /he purpose of the allotment-High Court failed to apply /he principle of
.. law governing allotment/sale-Hence, High Court judgment set aside.

Public Interest litigation-Scope of-Discussed

Respondent No.I has filed a public interest litigation against the E
appellant-company, challenging the allotment of a plot of land in its favour
by the Bangalore Development Authority, on the ground that the allotment
was made without following the due procedure. Single Judge of the High
Court allowed the petition holding that the allotment of the plot was
! allotment in bulk; and that allotment was made by the authority concerned F
'I
in violation of the provisions of the Bangalore Development Authority Act.
Appellant preferred a Letters Patent Appeal, which was dismissed by the
High Court. Hence the present appeal.

It was contended by the appellant that there was no legal impediment
for allotment of the land by the Authority to the appellant for the purpose G
of setting up of an industry; and that the provisions under Section 38 of
the Act confers unrestricted power on the Authority to lease/sell/transfer
movable/immovable property for the purpose of any development scheme.

Respondent submitted that since the plot of land was earmarked for
799 H
' .
800 SUPREME COURT REPORTS [2004] 3 S.C.R.
•.
A housing, the same could not have been allotted for the purpose of setting
up of an industry and that too without following the due procedure.

Allowing the appeal, the Court
.
?

HELD: I.I. No contention had been raised in the writ petition to the
B effect that the land could not be alienated by the Authority for setting up
of an industrial undertaking. In fact, the first respondent in the writ
petition ¥cepted that huge industrial area had come up as a result whereof
the potehtiality of the acquired lands had been increased by leaps and
bounds. The thrust of the writ petition was, . thus, on legality of the
C acquisition of the land or amount of compensation payable therefor.
(805-D-E(

1.2. The Division Bench of the High Court misconstrued and
misinterpreted the provision of Section 38 of the Bangalore Development
Authority Act; that the Authority has power to lease, sell or otherwise
D transfer any movable or immovable property belonging to it, subject to
such restrictions, conditions and limitations, as may be prescribed. The
State of Karnataka has framed three rules under the Act, namely, (i)
Bangalore Development Authority (Allotment of Sites) Rules, 1982; (ii) +
Bangalore Development Authority (allotment of Buildings under Self
Financing Housing Scheme) Rules, 1982; and (iii) Bangalore Development
E Authority (Disposal of Corner Sites and Commercial Sites) Rules, 1984.
It is beyond any cavil that the provisions of the Rules were not applicable
to the allotment in question. Thus, the question of power of the Authority
being restricted, conditioned or limited in selling or otherwise transferring
the property would not arise. (805-F-H; 806-A(
F Surinder Singh v. Central Government and Ors., (198614SCC667 and
Ashok Leyland Ltd. v. State of Tamil Nadu and Anr., (2004) I SCALE 224,
relied on.
I
K.R.C.S. Balakrishna Chetty and Sons & Co. v. The State of Madras,
G AIR (1961)SC 1152, distinguished.
1.3. In the instant case, no restriction, condition or limitation has
been prescribed and in that view of the matter, the High CQurt committed
a manifest error in holding that the provisions of the Rules would apply
to any transfer made by the Authority in favour of any person. Section
H 38-B which was inserted by Act No.17 of 1994 w.e.f. 20.12.1975 cannot
PRINTERS (MYSORE) LTD. r. M.A. RASHEED 801
....• have any application to the facts and circumstances of the case. The A
provisions of Sections 38 and 38B operate in different fields. By reason of
Section 38B of the Act, the legislature contemplated bulk transfer of land
in favour of the Authorities mentioned therein which may carry out the
development scheme or deal with the matter in accordance with law. High
Court has not correctly·11pplied the principles of law governing the field B
inasmuch as it cannot be said that allotment of a plot measuring I acre
20 gunthas is a bulk allotment. Whenever an allotment of land is made
for industrial purpose, it cannot be restricted to a small piece of land. The
extent of land sought to be allotted must be commensurate with the
purpose for which the same is made. 1807-F; 809-E-Gj

1.4. The writ petition should not have been entertained keeping in
c
view the fact that it was filed about three years after making of the
allotment and execution of the deed of sale. High Court should have
dismissed the writ petition on the ground of delay and laches on the part
o~ the first respondent. The Division Bench of the High Court also did not
consider the plea that the firs< respondent had been set up by certain D
interested persons. In a public interest litigation, the Court should, when
'' such a plea is raised, determine the same. 1810-B-C!
+
Chairman & MD. BPL Ltd. v. S.P. Gururaja and Ors.,. 120031 8 SCC
567 and Guruvayoor Devaswom Managing Committee and Anr. v. C.K. Rajan
and Ors., 120031 7 sec 546, relied on. E
Pad.ma v. Hiralal Moti/al Desarda and Ors., (2002) 6 SCALE 683,
distinguished.

Constitutional Reform in the U.K. by Dawn Oliver, referred to.
F
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4593 of
1999.

From the Judgment and Order dated 5.3.98 of the Karnataka High
Court in W.A. No. 1280 of 1996.
G
Shanti Bhushan, M.L Verma, S.K. Kulkarni, M. Gireesh Kumar, Ankur
S. Kulkarni and Ms. Sangeeta Kumar for the Appellant.

S.N. Bhat, Sanjay R. Hegde, KH. Nobin Singh (NP) for the Respondents.

The Judgment of the Court was delivered by H
802 SUPREME COURT REPORTS [2004) 3 S.C.R.

A S.B. SINHA, J.
INTRODUCTION:

Validity of a sale deed dated 19.6.1985 executed by the Bangalore
Development Authority (hereinafter referred to as 'the Authority') in favour
B of the appellant herein was que~tioned by the first respondent before the
High Court by way of a public interest litigation which has been allowed by
reason of the impugned judgment.

FACTUAL BACKGROUND:

C The appellant is a company incorporated under the Companies Act
engaged in printing and publishing of newspapers and periodicals. For grant
of allotment of a suitable plot for establishing an industry, an application was
filed by it before the said Authority and upon consideration thereof, a plot
admeasuring I acre 20 guntas under the Byrasandra-Travaekere-Madivala
(BTM) was allotted on a consideration ofRs.1,87,500/-. On the said amount
D having been deposited by the appellant, a deed of sale was executed in its
favour by the authority on or about 29.6.1985. The appellant was also put in ' '
possession thereof. A licence for fencing the property was also obtained by
t
the appellant.

In 1988, a public interest litigation was filed by the First Respondent
E herein, inter alia, on the ground that the impugned alienation was against
public policy and, thus, illegal and void having regard to the fact neither any
public auction was held therefor; nor any tender was called for; nor any
public advertisement for sale of the said land was issued.

The contention of the appellant in the aforementioned writ petition,
F inter alia, was that the said writ petition in the nature of public interest
litigation was in fact filed by the First Respondent at the instance of one S.A.
Krishnappa who had been unsuccessful at earlier stages in his attempt to stall
the acquisition proceedings. It was contended that one Mohd. Ibrahim had
also filed a suit to achieve the same purpose but it was dismissed. In the said
G writ petition the locus of the writ petitioner was also questioned.
A learned Single Judge of the High Court allowed the said writ
application by an order dated 29.1.1996 holding that the allotment in favour
of the appellant herein by the Authority being a bulk one, the same was
contrary to the provisions of the Bangalore Development Authority Act (for
H short 'the Act').
PRINTERS (MYSORE) LTD. r. M.A. RASHEED (SINHA . .I.) 803
.1. Aggrieved by and dissatisfied therewith, the appellant preferred a Letters A
Patent Appeal. A Division Bench of the High Court dismissed the same
holding that establishment of an industry cannot be termed as a step towards
development of the Bangalore Metropolitan Area. Noticing that under the
Act three different sets of rules bad been framed and interpreting Section 38
thereof, it was held that the provisions of the rules would govern the transfer· B
of land.

SUBMISSIONS:

Mr. Shanti Bhushan, learned Senior Counsel appearing on behalf of the
appellant assailing the impugned judgment, would submit that the High Court C
committed a manifest error insofar as it failed to take into consideration that
there was no legal impediment for allotment of the land by the Authority to
the appellant for the purpose of setting up of an industry for printing and
publishing of newspapers. The learned counsel would urge that the power to
lease, sell or otherwise transfer an immovable property having been conferred
on the Authority under ·the Act, no illegality can be said to have been D
committed in transferring the land in question in favour of the appellant.
Establishment of an industry for printing and publishing newspapers, it was
+ argued, comes within the purview of development of the metropolitan area.
Mr.Shanti Bhushan would urge that Section 38 of the Act confers an
unrestricted power to lease, sell or transfer movable or immovable property E
for the purpose of any development scheme.

Mr. S.N. Bhat, learned Senior Counsel appearing on behalf of the first
respondent, on the other hand, would contend that the land in question having
been earmarked for housing, the same could not have been allotted in favour
of the appellant without any tender having been issued or without issuing any F
(
advertisement therefor. The High Court, Mr. Bhat would contend, has rightly
"°'· set aside the allotment made by the Authority in favour of the appellant
having regard to the provision contained in Section 38 of the Act. Bulk
allotment, the learned counsel would argue, is covered by Section 388 of the
Act which admittedly is not attracted in the instant case.
G
STATUTORY PROVISIONS:

The said Act was enacted for the establishment of a Development
Authority for the development of the City of Bangalore and areas adjacent
thereto and for matters connected therewith.
H
·~

804 SUPREME COURT REPORTS [2004) 3 S.C.R.

A 'Development' has been defined in Section 2(j) to mean :

'Development' with its grammatical variations means the carrying
out of building, engineering, or other operations in or over or under
land or the making of any material change in any building or land
and includes redevelopment'"
B
Chapter III of the Act provides for development schemes. In tenns of
Section 15 of the Act, the Authority may draw up detailed schemes for the
development of Bangalore Metropolitan Area and with the previous approval
of the Government undertake from time to time any works for the Bangalore
Metropolitan Area and incur expenditure therefor and also for framing and
C execution of development schemes. It is also entitled to take up any new or
additional scheme from time to time.

Sections 38 of the Act reads thus :

"38. Power of Authority to lease, sell or tr~nsfer property.-Subject to
D such restrictions, conditions and limitations as may be prescribed, the
authority shall have power to lease, sell or otherwise transfer any
movable or immovable property which belongs to it, and to appropriate
or apply any land vested in or acquired by it for the formation of +
open spaces or for building purposes or in any other manner for the
E purpose of any development scheme."

Section 38-B of the Act provides as under :

"38-B. Power of Authority to make bulk allotment. Notwithstanding
anything contained in this Act or Development Scheme sanctioned
F under this Act, the authority may, subject to any restriction, condition
and limitation as may be prescribed, make bulk allotment by way of·
sale, lease or otherwise of any land which belongs to it or is vested
in it or acquired by it for the purpose of any development scheme.
(i) to the State Government; or (ii)to the Central Government, or
G (iii) to any Corporation, Body or Organisation owned or controlled
by the Central Government or the State Government; or
(iv) to any Housing Cooperative Society registered under the
Karnataka Cooperative Societies Act, 1959 (Karnataka Act 11
of 1959); or
H
PRINTERS (MYSORE) LTD.'" M.A RASHEED [SINHA . .I.] 805
l (v) to any society registered under the Karnataka Societies A
Registration Act, 1960 (Karnataka Act 7 of 1960); or
(vi) to a trust created wholly for charitable, educational or religious
purpose:
Provided that prior approval of the Government shall be obtained B
for allotment of land to any category listed above."

FINDINGS:

The first respondent in paragraph 3 of the writ petition averred :

"... In the said Link Road, huge Industrial Estates have come up and C
potentiality of the acquired lands being increased by leaps and
bounds ... "

The alienation of the land in question in favour of the appellant herein,
as notiGed hereinbefore, was questioned only on the ground that no auction
was held nor any tender therefor was called for and furthermore no public D
advertisement was issued prior to making of the impugned allotment. No
' .
contention had been raised in the writ petition to the effect that the land could
not be alienated by the Authority for setting up of an industrial undertaking.
In fact, as noticed hereinbefore, the first respondent in the writ petition accepted
that huge industrial area had come up as a result whereof the potentiality of E
the acquired lands had been increased by leaps and bounds. The thrust of the
writ petition was, thus, on legality of the acquisition of the land or amount
of compensation payable therefor.

The Division Bench of the High Court, in our opinion, misconstrued
and misinterpreted the provision of Section 38 of the Act. A bare perusal of F
the of the said provision would demonstrate that the Authority has power to
lease, sell or otherwise transfer any movable or immovable property belonging
to it, subject to such restrictions, conditions and limitations, as may be
prescribed. The State of Karnataka has framed three rules under the Act,
namely, (i) Bangalore Development Authority (Allotment of Sites) Rules,
1982; (ii) Bangalore Development Authority (Allotment of Buildings under G
Self Financing Housing Scheme) Rules, 1982; and (iii) Bangalore Development
Authority (Disposal of Corner Sites and Commercial Sites) Rules, 1984.

It is beyond any cavil that the provisions of the aforementioned three
sets of rules were not applicable to the allotment in question. If the provisions
of the said rules are not applicable in the instant case, the question of power H
806 SUPREME COURT REPORTS (2004] 3 S.C.R.

A of the Authority being restricted, conditioned or limited in selling or otherwise
transferring the property would not arise.

In Surinder Singh v. Central Government and Ors., [ 1986] 4 SCC
667], it was held:

B "6. The High Court has held that the disposal of property forming
part of the compensation pool was "subject" to the rules framed as
contemplated by Sections 8 and 40 of the Act and since no rules had
been framed by the Central Government with regard to the disposal
of the urban agricultural property forming part of the compensation
pool, the authority constituted under the Act had no jurisdiction to
c dispose of urban agricultural property by auction sale. Unless rules
were framed as contemplated by the Act, according to the High
Court the Central Government had no authority in law to issue
executive directions for the sale and disposal of urban agricultural
property. This view was taken, placing reliance on an earlier decision
D of a Division Bench of that court in Bishan Singh v. Central
Government. (1961) 63 Punj LR 75. The Division Bench in Bishan
case ((1961) 63 Punj LR 75] took the view that since the disposal of
the compensation pool property was subject to the rules that may be t
made, and as no rules had been framed, the Central Government had
no authority in law to issue administrative directions providing for
E the transfer of the urban agricultural land by auction sale. In our
opinion the view taken by the High Court is incorrect. Where a
statute confers powers on an authority to do certain acts or exercise
power in respect of certain matters, subject to rules, the exercise of
power conferred by the statute does not depend on the existence of
F rules unless the statute expressly provides for the same. In other
words framing of the rules is not condition precedent to the exercise
of the power expressly and unconditionally conferred by the statute.
The expression "subject to the rules" only means, in accordance with
the rules, if any. If rules are framed, the powers so conferred on
authority could be exercised in accordance with these rules. But if no
G rules are framed there is no void and the authority is not precluded
from exercising the power conferred by the statute."

In Ashok Leyland ltd. v. State of Tamil Nadu and Anr., (2004) I
SCALE 224 th is Court noticed:

H "Subject to" is an expression whereby limitation is expressed.
(
~·

PRINTERS (MYSORE) LTD. v. M.A. RASHEED [SINHA . .I.] 807

The order is conclusive for all purposes. A
This Court fu11her noticed the dictionary meaning of "subject to" stating:

"Furthermore, the expression 'subject to' must be given effect to.

In Black's Law Dictionary, Fiftl: E.!ition at page 1278 the B
expression "Subject to" has been defined as under :

"Liable, subordinate, subservient, inferior,obedient to; governed or
affected by; provided that; provided, answerable for. Homan v.
Employers Reinsurance Corp., 345 Mo. 650, 136 S.W. 2d 289, 302"

Reliance placed by Mr. Bhat in K.R.C.S. Balakrishna Chetty and Sons C
& Co. v. The State of Madras, AIR (1961) SC 1152 is misplaced. In that
case, an exemption provision contained in Section 5 of the Madras General
Sales Tax Act was invoked which could be granted only subject to such
restrictions and conditions, as may be prescribed and in that context it was
held:
D
" ... On a proper interpretation of the section it only means that the
' '
exemption under the licence is conditional upon the observance of
the conditions pre;cribed and upon the restrictions which are imposed
by and under the Act whether in the rules or in the licence itself; that
is, a licensee is exempt from assessment as long as he conforms to E
the conditions of the Iicence and not that he is entitled to exemption
whether the conditions upon which the licence is given are fulfilled
or not. The use of the words "subject to" has reference to effectuating
the intention of the law and the correct meaning, in our opinion, is
"conditional upon.""
F
·""\ In the instant case, it would appear, that no restriction, condition or
limitation has been prescribed and in that.view of the matter, the High Court,
in our opinion, committed a manifest error in holding that the provisions of
the said rules would apply to any transfer made by the Authority in favour
of any person. A similar question came up for consideration before this Court G
in Chairman & MD, BPL Ltd. v. S.P. Gururaja and Ors., [2003] 8 SCC 567.
This Court in that case examined in details the provisions of the said Act vis-
- a-vis the Karnataka Industrial Areas Development Act, 1966. Therein also
allotment of a peace of land in favour of an industrial undertaking was in
question. The Court referred to a large number of decisions including
Guruvayoor Devaswom Managing Committee and Anr. v. CK. Rajan and H
808 SUPREME COURT REPORTS [2004] 3 S.C.R.

A Ors., [2003] 7 sec 546 and held :
"Mr. Subba Rao referred to N.M. Thomas (supra) for the proposition
that court is also a 'State' within the meaning of Article 12 but that
would not mean that in a given case the cou11 shall assume the role
of the Executive Government of the State. Statutory functions are
B assigned to the State by the Legislature and not by the Court. The
Courts while exercising its jurisdiction ordinarily must remind itself
about the doctrine of separation of powers which, however, although
does not mean that the Court shall not step-in in any circumstance
whatsoever but the Court while exercising its power must also remind
itself about the rule of self-restraint. The Courts, as indicated
c hereinbefore, ordinarily is reluctant to assume the functions of the
statutory functionaries. It allows them to perform their duties at the
first instance.

The court steps in by Mandamus when the State fails to perform its
duty. It shall also step in when the discretion is exercised but the
D
same has not been done legally and validly. It steps in by way of a
judicial review over the orders passed. Existence of alternative remedy
albeit is no bar to exercise jurisdiction under Article 226 of the
Constitution of India but ordinarily it will not do so unless it is found
that an order has been passed wholly without jurisdiction or
E contradictory to the constitutional or statutory provisions or where an
order has been passed without complying with the principles of natural
justice. (See Whirlpool Corporation v. Registrar of Trade Marks,
Mumbai and Ors., [ 1998] 8 SCC l.

Exe(cise of self-restraint, thus, should be adhered to, subject of course
F to, just exceptions."

Dawn Oliver in Constitutional Reform in the UK under the heading
'The Courts and Theories of Democracy, Citizenship, and Good Governance'
at page I05 states:

G "However, this concept of democracy as rights-based with limited
governmental power, and in particular of the role of the courts in a
democracy, carries high risks for the judges-and for the public.
Courts may interfere inadvisedly in public administration. The case
of Bromley London Borough Council v. Greater London Council,
(1983) 1 AC 768, HL) is a classic example. The House of Lords
H
PRINTERS (MYSORE) LTD. v. M.A. RASHEED [SINHA, .I.] 809

quashed the GLC cheap fares policy as being based on a misreading A
of the statutory provisions, but were accused of themselves
misunderstanding transport policy in so doing. The courts are not
experts in policy and public administration-hence Jowell's point
that the courts should not step beyond their institutional capacity
(Jowell,2000). Acceptance of this approach is reflected in the
judgments of Laws LJ in International Transport Roth GmbH v. B
Secretary of State for the Home Department, (2J02) EWCA Civ 158,
(20020 3 WLR 344) and of Lord Nimmo Smith in Adams v. Lord
Advocate (Court of Session, Times, 8 August 2002) in which a
distinction was drawn between areas where the subject matter lies
within the expertise of the courts (for instance, criminal justice, C
including sentencing and detention of individuals) and those which
were more appropriate. for decision by democratically elected and
accountable bodies. If the courts step outside the area of their
institutional competence, government may react by getting Parliament
to legislate to oust the jurisdiction of the courts altogether. Such a
· step would undermine the rule of law. Government and public opinion D
'. may come to question the legitimacy of the judges exercising judicial
review against Ministers and thus undermine the authority of the
courts and the rule of law."

The said decision squarely applies to the fact of the present case. Section
38-B which was inserted by Act No.17 of 1994 w.e.f. 20.12.1975 cannot E
have any application to the facts and circumstances of the instant case. The
provisions of Section 38 and 38B operate in different fields. By reason of
Section 38B of the Act, the legislature contemplated bulk transfer of lan'd in
favour of the Authorities mentioned therein which, may carry out the
development scheme or deal with the matter in accordance with law. The p
High Court, in our opinion, has not correctly applied the principles of law
governing the field inasmuch as it cannot be said that allotment of a plot
measuring 1 acre 20 guntas is a bulk allotment. Whenever an allotment of
land is made for industrial purpose, it cannot be restricted to a small peace
of land. The extent of land sought to be allotted must be commensurate with
the purpose for which the same is made. G
Reliance placed by Mr. Bhat upon Padma v. Hiralal Motilal Desarda
and Ors., (2002) 6 SCALE 683 is again misplaced. In that case, it was
categorically held that the sale of bulk land by an institution like CIDCO was
an anathema to its objective and purpose or its establishment. Such alienation H
;

j

810 SUPREME COURT REPORTS l2004) 3 S.C.R.

A was held to be contrary to the law dealing with development planning. It was ....
I

further found therein that the land in question was required as buffer for
maintaining the ecology balance. Such is not the position herein.

Furthermore, the writ petition should not have been entertained keeping
in view the fact that it was filed about three years after making of the allotment
B and execution of the deed of sale. The High Court should have dismissed the
writ petition on the ground of delay and !aches on the part of the first
respondent. The Division Bench of the High Court also does not appear to
have considered the plea taken by the appellant herein to the effect that the
first r~spondent had been set up by certain interested persons. In a public
C interest litigation, the Court should, when such a plea is raised, determine the
same.

For the reasons aforementioned, the impugned judgment cannot be
sustained. It is accordingly set aside. The appeal is allowed. The writ petition
filed by the respondent stands dismissed. No costs.
D S.K.S. Appeal allowed.
..