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Wednesday, August 29, 2012

Civil Contempt Petition No.359 of 2011, whereby the alleged contemnors were held to be guilty of contempt of court for having violated the order passed by the Division Bench of the Jaipur Bench of the Rajasthan High Court on 5th February, 2010, in D.B. Civil Writ Petition No.8104 of 2008.-since in order to comply with the findings in M. Nagaraj’s case and Suraj Bhan Meena’s case, necessary data was required to be collected, in the absence of which it was not possible for the State and its authorities to act in terms of the observations made in M. Nagaraj’s case and in Suraj Bhan Meena’s case (supra). 44. Accordingly, we are of the view that despite the fact that there has been delay on the part of the State and its authorities in giving effect to the observations made in the two aforesaid cases, there was no willful or deliberate intention on their part to defy the orders of this Court. The very fact that the Bhatnagar Committee was appointed indicates that the State and its authorities had every intention to implement the aforesaid observations, though the progress of such implementation has been tardy. Accordingly, we are unable to sustain the impugned judgment and order of the Division Bench of the High Court holding the Appellants guilty of contempt of Court for purported violation of the order passed by the Division Bench of the Jaipur Bench of the Rajasthan High Court on 5th February, 2010, while disposing of the Civil Writ Petition No.8410 of 2008. Consequently, the judgment and order under appeal has to be set aside. 45. We, accordingly, allow the appeals and set aside the aforesaid judgment, but with the further direction that the State and its authorities act in terms of the Report of the Bhatnagar Committee, in accordance with the decision rendered in M. Nagaraj’s case and in Suraj Bhan Meena’s case (supra), within two months from the date of communication of this judgment and order.


|REPORTABLE            |




                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                     CIVIL APPEAL NOs. 2504-2505 OF 2012


1


2 Salauddin Ahmed & Anr.                … Appellants



           Vs.





           2 Samta Andolan                         … Respondent







                               J U D G M E N T





ALTAMAS KABIR, J.



1.    These appeals arise out of the common judgment and  order  dated  23rd
February, 2012, passed by the Division Bench of the Rajasthan High Court  in
D.B. Civil  Contempt  Petition  No.941  of  2010  and  D.B.  Civil  Contempt
Petition No.359 of 2011, whereby the alleged  contemnors  were  held  to  be
guilty of contempt of court for having violated  the  order  passed  by  the
Division Bench of the Jaipur Bench  of  the  Rajasthan  High  Court  on  5th
February, 2010, in D.B. Civil Writ Petition No.8104 of 2008.

2.    From the materials on record it  transpires  that  on  27th  November,
1972,  the  State  of  Rajasthan  issued  a   Notification   providing   for
reservation for Scheduled Castes/Scheduled Tribes candidates to  the  extent
of 15% for Scheduled Castes and 7.5% for Scheduled Tribes. Subsequently,  on
and from 3rd October, 1973, such reservation was increased to  16%  and  12%
for Scheduled Castes and Scheduled Tribes candidates, respectively. On  29th
January, 1981, the Rules for promotion based on the criteria  of  seniority-
cum-merit were introduced.  In 1992, in  the  case  of  Indira  Sawhney  Vs.
Union of India & Ors. [(1992) Supp.3 SCC 217],  this  Court  had  held  that
reservation in promotional posts for Scheduled Castes and  Scheduled  Tribes
candidates was not  permissible.   The  effect  of  the  said  decision  was
neutralized by the Constitution (Seventy Seventh Amendment) Act, enacted  on
17th June, 1995, whereby Article 16(4-A) was inserted  in  the  Constitution
to provide for reservation in respect  of  Scheduled  Castes  and  Scheduled
Tribes candidates in promotional posts.

3.    The aforesaid amendment led to a spurt of litigation. In  1996,  while
considering the said issue in the case of  Ajit  Singh  Januja  &  Ors.  Vs.
State of Punjab & Ors. [(1996) 2 SCC 715] (Ajit Singh-I),  this  Court  held
that even if the person in reserved category  is  promoted  earlier  than  a
general category candidate due to operation  of  roster,  and  subsequently,
the general category candidate was also  promoted,  the  candidates  in  the
general category would regain their  seniority  as  existing  in  the  cadre
prior to promotion. This method of allowing a subsequent promotee to  regain
seniority came to be known as the “catch-up”  principle.  On  30th  January,
1997, the Union of India issued a memorandum to all the various  departments
asking them to implement the  decision  rendered  by  this  Court  regarding
regaining of seniority pursuant to the said direction.  Thereafter,  on  1st
April, 1997, the State of Rajasthan followed suit and introduced the “catch-
up” principle. A provisional seniority list of candidates belonging  to  the
Rajasthan Administrative Services was issued on  26th  June,  2000,  on  the
basis of the Notification dated 1st April,  1997.   However,  it  was  never
given effect to and was ultimately quashed by the Rajasthan  High  Court  in
Writ Petition (Civil) Nos.2968 of 2000, 2176 of 2000, 3373 of 2000 and  3385
of 2000.

4.     In  2001,  the  Parliament  passed  the  Constitution  (Eighty  Fifth
Amendment) Act inserting the words “consequential seniority” for members  of
reserved category.  Thus  the  said  amendment  removed  the  basis  of  the
judgment rendered by this Court in Union of India & Ors.  Vs.  Virpal  Singh
Chauhan [(1995) 6  SCC  684]  and  in  Ajit  Singh-I’s  case  (supra).   The
provisions of the  said  amendment  were  given  retrospective  effect  from
17.6.1995, in order to remove  the  provision  relating  to  the  “catch-up”
principle with retrospective effect.

5.    In 2002, a writ petition was filed before this Court by the All  India
Equality Forum against the State of Rajasthan, seeking to  strike  down  the
Constitution (Eighty Second Amendment)  Act  and  the  Constitution  (Eighty
Fifth Amendment) Act of 2001.  The writ petitioner claimed  similar  reliefs
as in M. Nagaraj & Ors. Vs. Union of  India  &  Ors.  [(2006)  8  SCC  212].
Thereafter,  on  11th  November,   2002,   the   interim   order   regarding
implementation of Article 16(4-A) of the Constitution was clarified  and  it
was indicated  that  if  certain  candidates  from  reserved  category  were
entitled to promotion in terms of the provisions of  Article  16(4-A),  they
would be promoted.  It was, therefore, the stand of the Union of India  that
the interim order could not be construed to be a bar  to  implementation  of
the amendment to Article 16(4-A).  The order also provided  that  no  person
was to be  reverted  from  their  existing  placement  or  standing  in  the
seniority list.

6.    After having introduced the  same,  the  State  of  Rajasthan  by  its
Notification dated 28th December, 2002, withdrew  the  “catch-up”  principle
after the introduction of the Constitution  (Eighty  Fifth  Amendment)  Act.
From the Notification dated 28th December, 2002, it would be  seen  that  an
attempt was made to preserve the rights of general category candidates,  who
had already been promoted vide Notification dated 1st April,  1997.  It  was
also indicated that persons who had already been promoted vide  Notification
dated 1st April, 1997, were not to be reverted.

7.    The  vires  of  Article  16(4-A),  16(4-B)  and  Article  335  of  the
Constitution was  challenged  and  in  M.  Nagaraj’s  case  (supra)  it  was
considered by a Constitution Bench of this Court, which upheld the  validity
of Articles 16(4-A), 16(4-B)  and  the  amendment  to  Article  335  of  the
Constitution,  but  imposed  certain  conditions  regarding  reservation  in
promotion and accelerated promotions.  This Court directed  that  the  State
should collect quantifiable data, after  which  the  Committee  should  also
examine  the  requirements   relating   to   backwardness,   inadequacy   in
representation and efficiency for the purpose of  grant  of  reservation  in
promotion and accelerated promotions. One of the areas  of  dispute  between
the parties is that  the  State  Government  also  withdrew  the  “catch-up”
principle in  favour  of  general  category  candidates  with  retrospective
effect, but without following the  principles  enunciated  in  M.  Nagaraj’s
case (supra). On 24th June, 2008, a seniority  list  was  drawn  up  without
considering  the  “catch-up”  principle,  which  also  gave  effect  to  the
Notification dated 25th April, 2008.

8.    On 22nd August, 2008, D.B. Civil Writ Petition  No.8104  of  2008  was
filed by Bajrang Lal Sharma and others, challenging  the  said  Notification
dated 25th April, 2008, and the seniority list drawn up consequent  thereto.
While entertaining the writ petition, the Division Bench of the  High  Court
stayed the said Notification dated 25th April, 2008.

9.    On 4th March, 2009, a seniority list was prepared, but  the  same  was
quashed by the learned Single Judge. The Notifications dated 28th  December,
2002 and 23rd April, 2008, were challenged before the High Court by  several
candidates belonging to the general category and the  same  were  ultimately
quashed by the High Court on 5th February, 2010,  on  the  ground  that  the
conditions precedent laid down in M. Nagaraj’s case (supra),  had  not  been
followed.  The High Court was also of the view  that  the  right  which  had
vested to the candidates by virtue of  the  Notification  dated  1st  April,
1997, and had been protected by Notification dated 28th December, 2002,  had
been illegally taken away vide Notification dated 25th April, 2008.

10.   On 16th  November,  2010,  the  general  category  employees  filed  a
contempt petition against the  Chief  Secretary  for  not  implementing  the
order passed by the High Court on 5th February, 2010, which  was  registered
as D.B. Civil Contempt Petition  No.914  of  2010  in  D.B.  Civil  Contempt
Petition No.8104 of 2009, titled as Samta  Andolan  Vs.  Salauddin  Ahmad  &
Anr.  On an application filed before this Court, this Court vide  its  order
dated 16th November, 2010, stayed the contempt  proceedings  pending  before
the High Court.

11.   The case made out in  the  Contempt  Petition  was  that  despite  the
judgment dated 5th February, 2010, and the dismissal of the various  Special
Leave Petitions filed by the State of Rajasthan and others on 7th  December,
2010, the State authorities were  not  complying  with  the  said  judgment.
According to the Petitioners in the Contempt Petitions, the judgment of  the
High Court passed on 5th February, 2010, became final  after  the  dismissal
of the Special Leave Petitions, but despite the same, they  were  not  being
complied with by the concerned authorities of  the  State.  The  authorities
were deferring compliance of the judgment dated 5th February, 2010,  on  the
ground that they were undertaking the exercise  of  collecting  quantifiable
data required to enable the State of Rajasthan to exercise its powers  under
Article 16(4-A) of the Constitution.  It was the further  grievance  of  the
Contempt Petitioners that the letter issued by the State on  14th  February,
2011, was in purported compliance of the judgment dated 7th December,  2010,
passed in SLP(C) No.6385  of  2010,  asking  all  the  Departments  to  give
information with regard to the SC/ST  employees  from  1.4.1997  onwards  on
year-wise basis, which was not contemplated in the M. Nagaraj  judgment.  It
was also the case of the Contempt Petitioners that  Article  16(4-A)  is  an
enabling provision based on the Government’s information with regard to  the
backwardness and inadequate representation of SC/ST employees,  which  could
not be given retrospective effect.

12.   On account of the inaction of  the  alleged  contemnors  on  the  said
ground, the Contempt Petitioners not only prayed for  taking  severe  action
against the Contemnors, but to also give suitable  directions  to  the  said
Respondents/ Contemnors to implement the judgment dated 5th February,  2010,
passed in D.B. Civil Writ Petition No.8104 of 2008 and that the  Petitioners
be allowed to regain their accrued and vested seniority.

13.   As indicated hereinabove, the Division Bench of the High  Court  found
the Appellants herein to be guilty of having  committed  contempt  of  Court
for deliberate and willful violation of the order  passed  by  the  Division
Bench of the Jaipur Bench of the  Rajasthan  High  Court  on  5th  February,
2010.

14.   Thereafter, on 7th December, 2010, the  State  of  Rajasthan  filed  a
Special Leave Petition against the order passed by the  High  Court  on  5th
February, 2010, by which the Notifications dated  28th  December,  2002  and
25th April, 2008, had been quashed.  While upholding  the  judgment  of  the
High Court, this Court  also  observed  that  the  claims  of  the  reserved
category candidates could be considered after following the principles  laid
down in M. Nagaraj’s case (supra).  On 22nd December,  2010,  a  substantive
writ petition was filed by Captain Gurvinder Singh & Ors.  etc.  challenging
the vires of the Rajasthan  Scheduled  Castes,  Scheduled  Tribes,  Backward
Classes,  Special  Backward  Classes   &   Economically   Backward   Classes
(Reservation of Seats in  Educational  Institutions  in  the  State  and  of
Appointments & Posts in Services under the State) Act of  2008,  hereinafter
referred to as “2008 Act”.  The main ground of challenge was with regard  to
the reservation exceeding the 50% ceiling due to  extension  of  reservation
to Special Backward Classes  &  Economically  Backward  classes.   The  High
Court by its order dated 22nd December,  2010,  restrained  the  State  from
giving effect to Sections 3 and 4 of the 2008 Act.  It is the  case  of  the
Appellants that the said order  was  directed  against  the  reservation  in
respect of Special Backward Classes & Economically Backward Classes and  had
nothing to do with reservation in respect of promotion for Scheduled  Castes
and Scheduled Tribes candidates.

15.   On 31st March, 2011, the State Government  constituted  the  Bhatnagar
Committee to look into the different  aspects  relating  to  reservation  in
promotion and consequential seniority in terms of the judgment  rendered  in
M. Nagaraj’s case (supra).  Immediately, thereafter, on 13th April, 2011,  a
further contempt petition  was  filed  by  Shri  Bajrang  Lal  Sharma.   The
Bhatnagar Committee Report was submitted to the  State  Government  on  19th
August, 2011 and on 11th September, 2011, the State Government, in  exercise
of its powers under the proviso to Article 309 of the Constitution of  India
and on the basis of the Bhatnagar  Committee  Report,  framed  a  Rule  with
retrospective effect from 1st April, 1997, so  that  the  vacuum  which  had
been created could be filled up.  The Rule also  provided  for  roster-based
promotion based on the posts available and also preserved the rights of  the
general category candidates who had earned  promotions  between  the  period
1st April, 1997  to  28th  December,  2002,  or  the  promotions  which  had
actually been given effect to in terms of the  repealed  Notification  dated
1st April, 1997.

16.   Appearing for the Appellants, the  learned  Attorney  General  pointed
out that the Notification issued by the State Government on 11th  September,
2011, had been declared void by the High Court by holding that the same  did
not amount to valid compliance and the Notification dated 1st  April,  1997,
should be given effect to.  The  learned  Attorney  General  submitted  that
since  by  the  Notification  dated  11th  September,  2011,   the   earlier
Notification dated 1st April, 1997 had been withdrawn, the  same  could  not
be given effect to without  first  declaring  the  Notification  dated  11th
September, 2011, to be ultra vires.

17.   The learned Attorney General submitted  that  the  Notification  dated
11th September, 2011, could not  have  been  declared  ultra  vires  in  the
absence of a substantive writ petition challenging the  same,  and,  in  any
event, it could not be questioned in a contempt proceeding  or  be  declared
ultra vires therein, particularly, when the  Bhatnagar  Committee  had  been
appointed in terms of the order passed by this Court in  M.  Nagaraj’s  case
(supra) and the Notification dated  11th  September,  2011,  was  issued  in
pursuance of the Report of the said Committee.

18.   The learned Attorney General urged that by the  order  passed  by  the
Division Bench of the High Court in D.B.  Civil  Writ  Petition  No.8104  of
2008, the Notifications dated 28th December, 2002,  and  25th  April,  2008,
were declared to  be  ultra  vires  the  Constitution.   As  a  result,  the
consequential orders passed by  the  State,  including  preparation  of  the
seniority list of the Super-time Scale Officers and the Selection  Scale  of
the Rajasthan Administrative Service Officers, passed on the  basis  of  the
aforesaid Notifications, were quashed.  Aggrieved by  the  said  order,  the
State of Rajasthan and Shri Suraj Bhan Meena filed  separate  Special  Leave
Petitions before this Court which were disposed of on  7th  December,  2010.
This Court allowed  the  claim  of  Suraj  Bhan  Meena  (SC/ST  candidates),
subject to the conditions laid down in M. Nagaraj’s case (supra).

19.   While the various  above-mentioned  proceedings  were  being  pursued,
Writ Petition No.13491 of 2009 was filed challenging the vires of  the  2008
Act.  A prayer was also made to review the ceiling limit in  favour  of  SC,
ST and OBC candidates of 16%, 12% and 21%,  respectively.  The  Notification
dated 25th August, 2009, was also questioned.  The  subject  matter  of  the
Writ Petition was focussed on reservation to special  backward  classes  and
economically backward classes.  By  an  order  dated  22nd  December,  2010,
passed in the said Writ Petition, a Division Bench  of  the  Rajasthan  High
Court stayed the operation of Sections  3  and  4  of  the  Act  along  with
Notification dated 25th August, 2009, and the matter  was  referred  to  the
Rajasthan  State  Backward  Classes  Commission,  before  whom   the   State
Government was directed to place the quantifiable data within  a  period  of
one year.  The stay granted was directed to continue  till  the  matter  was
decided afresh.

20.   Subsequently, contempt proceedings were taken, being No.359  of  2011,
challenging the letter dated 14th February, 2011, issued  by  the  State  of
Rajasthan to the Heads of all Departments asking for  information  regarding
representation of SC/ST employees.  Ultimately, by  the  order  impugned  in
these appeals, the High Court held the Appellants herein  to  be  guilty  of
contempt of Court, inasmuch as, despite sufficient time  having  been  given
to the Respondents to comply with the order dated 5th  February,  2010,  the
Appellants failed to do so even after a  lapse  of  14  months  after  their
Special Leave Petitions were dismissed by this Court.  The High  Court  also
took note of the fact that the Appellant No.1 herein, Shri Salauddin  Ahmed,
did not even reply to the show-cause notice issued to him,  which  the  High
Court interpreted to mean that the said Appellant had nothing to say in  his
defence regarding the allegation of contempt  of  Court  made  against  him.
The High Court further noted that on several occasions time was  sought  for
by the State to comply with the order passed  on  5th  February,  2010,  but
nothing was done in the matter. Giving the Appellants 3 days’ time to  purge
themselves of the contempt and to comply  with  the  orders  passed  by  the
Court, the Court further directed the Appellants to  be  present  in  person
before the Court for the purpose of sentencing in case of non-compliance.

21.   Aggrieved by the order of the Division Bench  of  the  Rajasthan  High
Court, the State Government filed Civil Appeal No.2504-2505 of 2011  and  on
27th  February,  2012,  this  Court  issued  notice   and   stayed   further
proceedings before the High Court.

22.   The learned Attorney  General  submitted  that  the  order  dated  5th
February, 2010, was in two parts.  While one part  dealt  with  quashing  of
the Notifications dated 28th December, 2002 and 25th April, 2008, the  other
part was with regard to the directions given in M.  Nagaraj’s  case  (supra)
for the collection of quantifiable data.  It was further submitted that  the
State of Rajasthan had consistently acted as per  the  directions  given  in
paragraph 68 of the judgment rendered in Suraj Bhan  Meena’s  case  (supra),
whereby it was directed that the claim of the Petitioners, Suraj Bhan  Meena
and Sriram Chordia, in SLP (C) No.6385 of 2010,  would  be  subject  to  the
conditions laid down in M. Nagaraj’s case (supra).

23.    The  learned  Attorney  General  submitted  that  pursuant   to   the
directions given in Suraj Bhan Meena’s case (supra), the State of  Rajasthan
issued a letter to all the Departments on 14th  February,  2011,  to  ensure
compliance of the judgment dated  7th  December,  2010.   In  addition,  the
State Government sought information with regard to representation  of  SC/ST
employees in public employment from 1.4.1997  to  1.4.2010  on  a  year-wise
basis.  The learned Attorney General contended that on 8th March, 2011,  one
more contempt petition was filed, viz., Contempt Petition  No.359  of  2011,
in  relation  to  the  letter  dated  14th  February,  2011,   referred   to
hereinabove. It was submitted  that  the  State  cannot  collect  data  with
retrospective effect in pursuance of  the  decision  in  M.  Nagaraj’s  case
(supra) and the judgment dated 7th December, 2010.  It  was  also  submitted
that the State of Rajasthan was not required  to  collect  the  quantifiable
data to comply with the judgment dated 5th February, 2010.

24. It was also contended that the  contempt  petitioner  had  misunderstood
the import of the judgment dated 5th February, 2010, passed by the  Division
Bench of the High Court in relation to the judgment of this Court dated  7th
December, 2010.  The learned Attorney  General  submitted  that  it  was  on
account of the confusion in the mind of the Petitioner  that  a  prayer  had
been made  in  the  Contempt  Petition  for  suitable  directions  upon  the
contemnors to implement the judgment dated 5th  February,  2010,  passed  in
D.B. Civil Writ Petition No.8104 of 2008 and to  allow  the  Petitioners  to
regain their accrued and vested seniority given to them in pursuance of  the
seniority list of 26.6.2000.  It was submitted that the  seniority  list  of
26.6.2000 had already been quashed by the High Court in  a  dispute  between
direct recruits and promotees and the said matter is pending in  this  Court
by way of a Special Leave Petition.

25.   The learned Attorney General submitted that the  constitution  of  the
Bhatnagar Committee in pursuance of the order passed by this  Court  on  7th
December, 2010, was challenged  by  filing  of  interlocutory  applications,
both  before  this  Court  and  also  before  the  High   Court.   All   the
interlocutory applications were taken up for consideration and  disposed  of
by this Court on 20th July, 2011.  The learned  Attorney  General  submitted
that in the said order, this Court had  recorded  the  fact  that  Mr.  M.L.
Lahoti, learned counsel appearing for the  Respondents,  did  not  challenge
the formation of the Committee, but contended that its findings should  have
prospective  operation  and  could  not  affect  the  case   of   the   writ
petitioners, Suraj Bhan Meena and others. It was also emphasized  that  this
Court took cognizance of the constitution of the  Bhatnagar  Committee,  but
did not pass any restraint orders with regard to its  functioning.   On  the
other hand, while disposing of the several interlocutory applications,  this
Court  also  observed  that  the  parties  would  be  free  to  make   their
submissions with regard to the action taken by the State Government  in  the
matter pending before the High Court.  The learned  Attorney  General  urged
that the High Court had noticed the  order  passed  by  this  Court  on  7th
December, 2010, but had not considered the directions contained therein.

26.   The learned Attorney General submitted that  the  Bhatnagar  Committee
Report had been submitted on 19th August, 2011, and after due  consideration
of the Report, a Notification was issued on 11th September, 2011.   However,
it was also  noticed  by  the  High  Court  that  the  constitution  of  the
Bhatnagar Committee, as also the  Notification  issued  on  11th  September,
2011, was not in conformity with the judgment rendered by the High Court  on
5th February, 2010, without noticing that the same was in compliance of  the
directions contained in paragraph 68  of  the  judgment  delivered  by  this
Court on 7th December, 2010.  The learned Attorney  General  submitted  that
the directions contained in  the  aforesaid  judgment  dated  7th  December,
2010, recognizing the rights of the reserved category (Petitioners  therein)
and  directing  the  determination  of  such  rights,  be  undertaken  after
completion of the exercise laid down in M. Nagaraj’s case (supra).

27.   On maintainability, it was contended that it was beyond the powers  of
this Court to declare a law ultra vires in the  contempt  jurisdiction.   It
was also contended that in view of the decision of this Court  in  State  of
U.P. vs. Hirendra Pal Singh [(2011) 5 SCC 305], a judicial order  could  not
be passed to give effect to a repealed law or a law which was no  longer  in
existence, as has been done in  the  instant  case.   The  learned  Attorney
General  reiterated  that  the  High  Court  had  erroneously  declared  the
Notification dated 11th September, 2011,  to  be  ultra  vires  without  any
challenge being made to such Notification.

28.   The learned Attorney General submitted that  the  Bhatnagar  Committee
had been formed pursuant to the directions given  by  this  Court  in  Suraj
Bhan Meena’s case (supra) and this Court  while  disposing  of  the  Special
Leave  Petitions  filed  by  Suraj  Bhan  Meena  and  others   categorically
indicated that the impugned order of the High Court was, in fact,  based  on
the  decision  in  M.  Nagaraj’s  case  (supra)  as  no  exercise  had  been
undertaken  in  terms  of  Article  16(4-A)  to  acquire  quantifiable  data
regarding the inadequacy of  representation  of  the  Scheduled  Castes  and
Scheduled Tribes communities in public service and that the  Rajasthan  High
Court had rightly quashed the notifications dated 28th  December,  2002  and
25th  April,  2008,  issued  by  the  State  of  Rajasthan   providing   for
consequential seniority and  promotion  to  the  members  of  the  Scheduled
Castes and Scheduled Tribes communities.  The Special Leave Petitions  were,
therefore, disposed of by observing  that  the  claim  of  the  Petitioners,
Suraj Bhan Meena and Sriram Chordia in SLP (C) No.6385  of  2010,  would  be
subject to the conditions laid down  in  M.  Nagaraj’s  case  (supra).   The
Special Leave Petitions filed by the State of  Rajasthan  were  consequently
dismissed.  The learned Attorney General  urged  that  this  Court  had,  in
fact, directed that the parties would be  free  to  make  their  submissions
with regard to the action taken  by  the  State  Government  in  the  matter
pending before the High Court.

29. The learned Attorney General concluded on  the  note  that  as  recently
observed by this Court in Dinesh Kumar Gupta Vs. United India Insurance  Co.
Ltd. [(2010) 12 SCC 770], in order to establish that a  civil  contempt  had
been committed, it would have to be shown that the concerned  authority  had
willfully and deliberately disobeyed the orders passed  by  the  High  Court
without any reasonable or rational interpretation  of  the  order.   It  was
also observed that it would not also be correct to hold that a contempt  had
been committed when the disobedience was  neither  deliberate  nor  willful,
but the steps taken were on account of the ignorance of  the  correct  legal
position and the action taken was in good faith without any malafide  motive
to defeat or defy the Court’s order.

30.    The  learned  Attorney  General  submitted  that  in  this  case,  in
compliance with the decision in Suraj Bhan  Meena’s  case  (supra)  and  the
directions given both in M. Nagaraj’s case (supra)and in Suraj Bhan  Meena’s
case  (supra),  the  concerned  authorities  had  appointed  the   Bhatnagar
Committee to enter into a fact  finding  exercise  in  accordance  with  the
provisions of Article 16(4-A) of the Constitution.  It  could  not  be  said
that there was any willful or deliberate intention  or  malafide  motive  on
the part of the concerned authorities in not complying with  the  directions
contained in the judgment of the High Court dated 5th  February,  2010.  The
Contempt Petition was, therefore, liable to be dismissed.

31.   Mr. C.S. Vaidyanathan, learned Senior Advocate, who had  appeared  for
the second contemnor, Khemraj  Chaudhary,  while  adopting  the  submissions
made by the learned Attorney General, submitted that the steps taken by  the
Respondents were in keeping with the directions given both in  M.  Nagaraj’s
case (supra)and in Suraj Bhan Meena’s case  (supra),  for  identifying  such
members of the SC/ST communities who  would  be  entitled  to  the  benefits
provided under  Article  16(4-A)  of  the  Constitution.   Mr.  Vaidyanathan
reiterated the submissions made before the  High  Court  that  the  Contempt
Petitions were, in fact, not maintainable as the orders  out  of  which  the
same had arisen had merged in the order  of  this  Court  when  the  Special
Leave Petitions were dismissed by  a  reasoned  judgment.   Accordingly,  by
virtue of the doctrine of merger, the said orders do not exist and,  if  any
contempt is alleged, it would be with regard to the orders  passed  by  this
Court and the High Court had no jurisdiction to entertain the matter.

32.   Mr. Vaidyanathan further submitted that on account  of  non-compliance
with the three requirements indicated in  M.  Nagaraj’s  case  (supra),  the
notification dated 28th December, 2002, stood vitiated.  However,  with  the
quashing  of  the  said  notification  dated  28th   December,   2002,   the
notification dated 1st April, 1997,  which  stood  deleted  by  notification
dated 28th December, 2002, stood revived and continued to be  in  operation.


33.   Mr. Harish Salve, learned Senior Advocate, who also appeared  for  the
Respondents, contended that Civil Appeal No.171 of 2002, filed by the  State
of Rajasthan against Hanuman Singh Bhati & Ors.,  was  pending  before  this
Court, but this Court had not stayed the operation of the orders  either  of
the Single Bench or  the  Division  Bench.   As  a  result,  even  by  sheer
inaction in carrying out the directions contained in the  judgment  of  this
Court dated 7th December, 2010, the contemnors had violated  the  orders  of
this Court, as there was no justification for the  contemnors  not  to  give
effect to the directions contained in the said order.  Mr.  Salve  submitted
that in Maninderjit Singh Bitta Vs. Union of India  &  Ors.  [(2012)  1  SCC
273], this Court had held that even inaction to implement the orders of  the
Court amounts to disobedience within the meaning  of  civil  contempt.   Mr.
Salve urged that in the absence of any stay, the  contemnors  ought  not  to
have sat over the matter, but should  have  taken  steps  to  implement  the
directions contained in the said order.  Mr. Salve submitted  that  so  long
as the catch up principle in terms of  the  Notification  dated  1st  April,
1997, continued to be in existence, no change could be made  in  matters  of
promotion, unless the requirements set out in M. Nagaraj’s case  were  fully
satisfied.  Mr. Salve urged that in the  facts  and  circumstances  of  this
case, contempt was writ large on account of inaction of  the  contemnors  in
giving effect  to  the  directions  contained  in  the  judgment  dated  5th
February, 2010.

34.   Dr. Rajeev Dhawan, learned Senior Advocate, who also appeared for  the
Respondents,  approached  the  matter  from  a  slightly  different   angle.
Arguing that the doctrine of merger could  not  be  applied  to  a  contempt
proceeding, Dr. Dhawan referred to Kunhayammed & Ors. Vs. State of Kerala  &
Anr. [(2000) 6 SCC 359].  Dr. Dhawan  urged  that  the  doctrine  of  merger
depends on the facts of each case.  Dr. Dhawan submitted that even in  Suraj
Bhan Meena’s case (supra), this Court upheld the judgment of the High  Court
dated 5th February, 2010, without  making  any  changes,  which  could  have
altered the purport of the said judgment.  Dr. Dhawan  also  contended  that
so long as the “catch-up” doctrine  continued  to  be  in  force  under  the
Notification dated 1st April, 1997, which stood revived on  account  of  the
quashing of the Notifications dated 28th December, 2002 and  25th  February,
2008, it could not be contended that by appointing the Bhatnagar  Committee,
the alleged contemnors had not willfully violated the  directions  given  by
this Court in Suraj Bhan Meena’s case (supra).

35.   Dr. Dhawan fairly conceded that an order may be violated  without  any
willful  intent  to  disobey  the  same.   Referring  to  paragraph  459  of
Halsbury’s Laws of England, dealing with “unintentional  disabilities”,  Dr.
Dhawan pointed out that sometimes it may so happen that an  order  of  Court
is breached without any intention on the part of  the  offender  to  do  so.
Dr. Dhawan submitted that this could be such a case  and,  accordingly,  the
contemnors could  be  directed  to  purge  themselves  of  the  contempt  by
withdrawing all the Notifications, including  the  Notification  dated  11th
September, 2011, and implementing the order dated 5th  February,  2010,  and
also to punish the contemnors without sentence.

36.   In order to establish that a person  had  deliberately  and  willfully
committed contempt of Court, two essential ingredients have  to  be  proved.
Firstly, it has to be established that an  order  has  been  passed  by  the
Court which either directs certain things to be  done  by  a  person  or  to
restrain such person or persons from doing certain acts and that the  person
or persons had  knowledge  of  the  said  order.  Secondly,  it  has  to  be
established  that  despite  having  knowledge  of  such  order,  the  person
concerned deliberately and willfully violated the same  with  the  intention
of lowering the dignity and image of the Court.  We have to see  whether  in
the facts of this case the said two tests are satisfied.

37.   Admittedly, Civil Writ Petition No.8104 of 2008,  along  with  several
other writ petitions,  were  disposed  of  by  the  Division  Bench  by  its
judgment and order dated 5th February, 2010, by quashing  the  Notifications
dated 25th April,  2008  and  28th  December,  2002,  issued  by  the  State
Government without following the exercise indicated  in  M.  Nagaraj’s  case
(supra).  As has been mentioned  hereinbefore,  by  its  Notification  dated
25th April, 2008, the Government of Rajasthan  in  exercise  of  its  powers
conferred by the proviso to  Article  309  of  the  Constitution  of  India,
amended the Rajasthan Various Service Rules, as mentioned  in  the  Schedule
appended  therewith,  with  effect  from  28th  December  2002.    By   such
amendment, the existing proviso to the Rule providing that a candidate,  who
had got the benefit of the proviso  inserted  vide  Notification  dated  1st
April, 1997, on  promotion  to  an  immediate  higher  post,  would  not  be
reverted and his seniority would remain unaffected,  subject  to  the  final
decision of this Court in Writ Petition (C) No.234/2002, was  deleted.   For
the sake of record, it may be indicated that before the  Division  Bench  of
the High Court it had been conceded by the  learned  Advocate  General  that
the exercise as contemplated in M. Nagaraj’s  case  (supra),  had  not  been
undertaken by the State before issuing the Notifications dated  25th  April,
2008 and 28th December, 2002.  It  is  on  that  basis  that  the  said  two
Notifications  and  all  consequential  orders  or  actions  taken  by   the
Respondent State, including preparation of  seniority  list  of  Super  Time
Scale and Selection Scale Officers of the Rajasthan Administrative  Service,
on the basis thereof, were also quashed and set aside.  While  quashing  the
said Notifications, the Division Bench took note of  the  observations  made
in M. Nagaraj’s case (supra) that Clause (4-A) of Article  16  was  only  an
enabling provision and the State was  not  bound  to  make  reservations  of
Scheduled Castes and Scheduled Tribes in the matter  of  promotion,  but  if
they did wish to exercise their discretion in that regard, the State had  to
collect quantifiable data showing backwardness of the class  and  inadequacy
of representation of  that  class  in  public  employment,  in  addition  to
compliance with Article 335.  The  same  not  having  been  done,  the  said
Notifications were quashed.

38.   Inasmuch as, no  further  action  was  taken  by  the  State  and  its
authorities  after  the  said  Notifications  were  quashed,  the   contempt
petition was filed mainly on the ground that the State and  its  authorities
had by their inaction in complying with  the  requirements  set  out  in  M.
Nagaraj’s case (supra),  committed  contempt  of  Court  and  the  same  was
accepted and the Appellants herein were found  guilty  of  having  committed
contempt of Court by such inaction.

39.   The next thing that we  are  required  to  consider  is  whether  such
inaction was on account of  any  circumstances  which  prevented  the  State
Government  and  its  authorities  from  taking  action  in  terms  of   the
observations made by the Division Bench of the High Court  in  its  judgment
dated 5th February, 2010, or whether such inaction was  on  account  of  the
deliberate intention of the State and its authorities not to give effect  to
the same.

40.   The learned Attorney General,  who  had  appeared  for  the  State  of
Rajasthan and its authorities,  had  submitted  that  the  Order  dated  5th
February, 2010, was in two parts.  While one part dealt  with  the  quashing
of the two Notifications, the other was  with  regard  to  the  observations
made in the said order with regard to the directions given in  M.  Nagaraj’s
case (supra) for collection of the quantifiable data  before  giving  effect
to the provisions of Article  16(4-A)  of  the  Constitution.   The  learned
Attorney General has also emphasized that in order to  give  effect  to  the
second part of  the  judgment  and  order  of  the  Division  Bench  of  the
Rajasthan High Court and  the  directions  given  in  paragraph  68  of  the
judgment in Suraj Bhan Meena’s case (supra),  the  Government  of  Rajasthan
had appointed the Bhatnagar Committee to obtain  the  quantifiable  data  to
comply with the directions  given  in  the  two  aforesaid  judgments.   The
learned Attorney General has also pointed  out  that  directions  have  been
given to all the different departments on 14th  February,  2011,  to  ensure
compliance  with  the  directions  contained  in  Suraj  Bhan  Meena’s  case
(supra).

41.   Although, it has been urged on behalf of the  Respondents  that  there
was a restraint order on the State and its authorities  from  giving  effect
to the observations made in the order passed by the Division  Bench  of  the
High Court on dated 5th February, 2010, or  even  in  the  order  passed  in
Suraj Bhan Meena’s case (supra), the  State  and  its  authorities  remained
inactive on the plea that  it  had  appointed  the  Bhatnagar  Committee  to
collect the data necessary in terms of the judgment and order passed  in  M.
Nagaraj’s case, which had been  reiterated  by  this  Court  in  Suraj  Bhan
Meena’s case (supra).

42.   The explanation given on behalf  of  the  State  and  its  authorities
cannot be discounted, since in order to  act  in  terms  of  the  sentiments
expressed by the High Court and this Court, it was necessary to collect  the
quantifiable data in  respect  of  Scheduled  Castes  and  Scheduled  Tribes
candidates.  For collection of such data, the State appointed the  Bhatnagar
Committee which was entrusted with the work of obtaining  such  quantifiable
data so that the provisions of the amended Clause (4-A) included in  Article
16 of the Constitution could be given effect to in terms of  the  directions
given in M. Nagaraj’s case subsequently reiterated  in  Suraj  Bhan  Meena’s
case.

43.   The various submissions advanced by Mr.  Salve,  Dr.  Dhawan  and  Mr.
Sanjeev Prakash Sharma in support of the decision of the Division  Bench  of
the High Court, holding the Appellants guilty of contempt of Court  and,  in
particular, the alleged inaction to implement the judgment and orders in  M.
Nagaraj’s case and Suraj Bhan Meena’s case are not  very  convincing,  since
in order to comply with the findings in M. Nagaraj’s  case  and  Suraj  Bhan
Meena’s case, necessary data was required to be collected,  in  the  absence
of which it was not possible for the State and its  authorities  to  act  in
terms of the observations made in  M.  Nagaraj’s  case  and  in  Suraj  Bhan
Meena’s case (supra).

44.   Accordingly, we are of the view that despite the fact that  there  has
been delay on the part of the State and its authorities in giving effect  to
the observations made in the two aforesaid cases, there was  no  willful  or
deliberate intention on their part to defy the orders of  this  Court.   The
very fact that the Bhatnagar Committee  was  appointed  indicates  that  the
State and its authorities had every intention  to  implement  the  aforesaid
observations, though the progress of such  implementation  has  been  tardy.
Accordingly, we are unable to sustain the impugned  judgment  and  order  of
the Division Bench of the  High  Court  holding  the  Appellants  guilty  of
contempt of Court for  purported  violation  of  the  order  passed  by  the
Division Bench of the Jaipur Bench  of  the  Rajasthan  High  Court  on  5th
February, 2010, while disposing of the Civil Writ Petition No.8410 of  2008.
 Consequently, the judgment and order under appeal has to be set aside.

45.  We,  accordingly,  allow  the  appeals  and  set  aside  the  aforesaid
judgment, but with the further direction that the State and its  authorities
act in terms of the Report of the Bhatnagar Committee,  in  accordance  with
the decision rendered in M. Nagaraj’s case and in Suraj  Bhan  Meena’s  case
(supra), within two months from the date of communication of  this  judgment
and order.

46.   There will be no order as to costs.





                                                     ………………………………………………………J.
                                     (ALTAMAS KABIR)






                                                     ………………………………………………………J.
                                     (J. CHELAMESWAR)
New Delhi
Dated:29.08.2012.

As far as the land meant for the Children’s amusement park is concerned, the same was hardly put to the full use. In as much as this entire parcel of land of about 7 acres was not utilized, and since it was an open parcel of land, there was nothing wrong in the State Government deciding to retain it as an open parcel of land, and to change the land-use thereof from commercial to a regional park. The notification cannot be faulted on that count either. 27. In the circumstances, we do not find any error in the impugned judgment of the High Court. The appeal is therefore dismissed. Parties will bear their own costs.


                                 Reportable

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION


                       Civil  Appeal  No. 6105 OF 2012
                   (Arising out of SLP No. 16416 OF 2011)


Mangal Amusement Park (P) Ltd. & Anr.                    ...    Appellants

                                   Versus


State of Madhya Pradesh & Others                   ...         Respondents









                          J  U  D  G  E  M  E  N  T

H.L. Gokhale J.

            Leave granted.

2.          This appeal by special leave seeks  to  challenge  the  judgment
and order dated 19.5.2011  rendered  by  a  Division  Bench  of  the  Madhya
Pradesh High Court dismissing the Writ Petition bearing  No.5698/2008  filed
by the appellants herein.  The said petition sought to challenge the  change
of land-use from ‘commercial’ to a ‘regional  park’  of  a  parcel  of  land
which had been allotted to the appellants in the  town  planning  scheme  of
Indore, and also the decision of the State  Government  that  the  concerned
land be utilized only after inviting fresh tenders.

3.          The first appellant herein is a  Company  registered  under  the
provisions of the Companies Act, 1956,  and  the  second  appellant  is  its
Managing Director.  The respondent No.1 to  this  appeal  is  the  State  of
Madhya Pradesh through its Principal Secretary, Department  of  Housing  and
Environment, Bhopal, whereas the respondent No.2 is  the  Director  of  Town
and Country Planning of  Madhya  Pradesh.   The  third  respondent  to  this
appeal is  Indore  Development  Authority  (“IDA”  for  short)  through  its
Chairman, whereas the fourth respondent is the same  Authority  through  its
Chief Executive Officer.  Shri Ranjit  Kumar,  learned  senior  counsel  has
appeared for the appellants.  Shri Vikas Singh, learned senior  counsel  has
appeared for  the  first  two  respondents,  and  Ms.  Vibha  Datta-Makhija,
learned counsel has appeared for respondent no.3 and 4.

      Facts leading to this appeal:-

4.   During November 1991 to February  1992,  IDA  floated  tenders  through
advertisements for setting up of an amusement  park  on  a  parcel  of  land
owned  by  it  situated  in  village  Bhamori-Dubey.   The  concerned   land
admeasured about seven acres  comprising  of  survey  nos.  91  part,  92/1,
93/1, 93/2, 94/1, 94/2, 95/1, 95/2, 96/1, 96/2, 152,  155  part,  157,  159,
160, 162, 163, 164 part, 165 part and  166  part  and  was  situated  within
Scheme  No.54.   There  is  no  dispute  that  under  the  then   subsisting
Development  Plan  the  designated  land-use  of  these  survey   nos.   was
‘commercial’.  It is the case of the appellants that though they applied  in
pursuance to the advertisement, and though  the  appellants  were  the  most
eligible, IDA arbitrarily delayed the acceptance of their tender.  This  led
the appellants to file an earlier writ petition in the High Court of  Madhya
Pradesh bearing M.P. No.313/1992  which  was  allowed  by  the  High  Court.
Consequently, the appellants were allotted  this  parcel  of  land  for  the
establishment of a Children’s amusement park.

5.          Accordingly, IDA granted a license to the appellants, the  terms
and conditions of which were as follows:-
                 “           LICENSE
                       (FOR AMUSEMENT CENTRE)
                                             Dated 6.5.1994

           This license is granted  to  Shri  Ramesh  Mangal  son  of  Shri
           Manikchand Mangal age 48 years, resident of  8/2,  New  Palasia,
           Indore, Managing Director, M/s Mangal Amusement Park Pvt.  Ltd.,
           Indore, by  the  Indore  Development  Authority  Indore  (M.P.).
           Terms and conditions of this license shall be as follows:-

                 TERMS AND CONDITIONS:-

           The land measuring 7 acres is given to M/s Mangal Amusement Park
           Pvt. Ltd. (hereinafter called the ‘Licensee vide letter  No.4179
           dated 4.4.1994 on license by the  Indore  Development  Authority
           initially for a period of 15 years.  The licensee will  have  to
           develop inside infrastructure such as path-ways, roads, boundary
           walls, land installation of rides and games etc. at his own cost
           as approved by the Authority.  Construction of Food & Beverage’s
           Centres, Kiosks, Shops, Administrative  building,  toilet  shall
           also be permissible as per requirement.

           2.    The period of license shall  commence  from  the  date  of
           activation of the park or 18 months  from  the  date  of  giving
           possession, whichever is earlier.

           3.    The period of completion of the project shall be 24 months
           (inclusive of Monsoon season) from the date of handing over  the
           possession of the said land.  Failing which, the license may  be
           terminated, forfeiting the Earnest Money and other payments,  if
           any, by the Authority.

           4.    The advance license fee shall be payable  annually  before
           first of June.  In case, the licensee fails to pay the fee on or
           before the due date, an interest at the rate of  18%  per  annum
           shall be charged for period defaulted.  The  interest  shall  be
           calculated on the license fee itself for full calendar month.

           5.    In addition to the license fee, an amount equal to 25%  of
           the entry fee will be charged by the I.D.A. and has to  be  paid
           by the licensee by 10th of next month.

           6.    Earnest Money of Rs.1,00,000/- has been kept  with  I.D.A.
           and no interest shall be given on the amount of  Earnest  Money.
           This amount shall be adjusted towards  license  fee  1,81,000.00
           (Rs. One Lac eighty thousand only) per year on commission of the
           project.

           7.    The Authority or an  officer  authorized  in  this  behalf
           shall have the power to examine the accounts  of  collection  of
           entry fee, as and when deemed fit.  The  Authority  may  further
           regulate the mode of collection  of  entry  fee.   The  duty  of
           collection of entry fee will rest on the licensee himself.

           8.    The license may be renewed for further period of 15  years
           by enhancing the license fee, maximum by 40% and  thereafter  at
           such a percentage as may be decided by the Authority.

           9.    Bank Guarantee of Rs.5,00,000/- (Rs. Five lacs only) given
           by the licensee shall be redeemed  after  three  complete  years
           from the date of activation of the amusement park.

           10.   The rides, games etc. should be bought from the  suppliers
           manufacturing these in India indigenously.

           11.   At least one roller coaster, one  ferries  wheel  and  bay
           train, one set of merry cups, one Columbus  and  one  telecombat
           must be erected with other rides.

           12.   The  complete  amusement  centre  shall  be  operated  and
           managed  by  the  licensee  himself  at   his   own   cost   and
           responsibilities.

           13.   In the event of any increase or decrease in  the  area  on
           physical measurement, the license fee shall be  subject  to  the
           increase or decrease proportionately.







           14.   In the  event  of  violation  of  any  of  the  terms  and
           conditions mentioned hereinabove, on the part of  the  licensee,
           the decision of the Chairman, Indore Development Authority shall
           be final.

           15.   Land for which licnese  is  granted  is  marked  in  green
           colour in………. plan.

                                        SIGNATURE OF LICENSEE”



6.          It is the case of the appellants that they submitted the  plans,
maps and drawings for necessary construction, and thereafter  started  using
the concerned parcel of land as amusement park.

7.          It so transpired that  sometime  in  December  1999,  respondent
nos.1 and 2 i.e. the  State  and  the  Town  Planning  Dept.  initiated  the
process of modification of the Development Plan.  In  that  process  it  was
proposed to change the user of this parcel  of  land  from  ‘commercial’  to
‘regional park’ (i.e. a green area).  The Chairman of IDA however, wrote  in
that context to the respondent nos.1 and 2 on 7.12.1999 that such  a  change
was not desirable, since the use of the concerned land was  already  secured
for a specified  purpose  in  the  master  plan.  The  State  Govt.  however
proceeded to issue a notification on 9.3.2001  under  Section  23-A  (2)  of
Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973 (M.P. Act for  short)
proposing the change of the land-use from ‘commercial’ to  ‘regional  park’,
and inviting  objections  thereto.   The  appellants  did  raise  objections
against  the  proposed  modification  which  were  heard  by  the  Principal
Secretary to the Govt. of Madhya Pradesh on 23.8.2001.

8.          It is the case of the appellants that they wanted to  put  up  a
banquet hall and an amusement club on this parcel  of  land,  and  therefore
sought the requisite permission from IDA.  IDA in fact passed  a  resolution
bearing No. 133 on 8.5.2003 recommending grant  of  such  permission  though
subject to the conditions mentioned therein.  The  Chief  Executive  Officer
of IDA accordingly wrote to the Principal Secretary of  the  Madhya  Pradesh
Govt. on 27.5.2003 for grant of this permission, and  consequently  for  the
increase in the  license  fee.   The  State  Govt.  however  wrote  back  on
23.9.2003 declining the request,  and  asking  IDA  to  invite  the  tenders
afresh for the re-allotment of the  plot  (the  appellants  however  contend
that there is a  contrary  note  on  the  files  of  the  respondents  dated
29.9.2003 recommending  the  proposed  use).   That  apart,  ultimately  the
Madhya Pradesh Govt. issued the notification approving  the  change  in  the
land-use from ‘commercial’ to a ‘regional park’ on 19.11.2003.  It  is  this
letter  dated  23.9.2003  and  notification  dated  19.11.2003  which   were
challenged by the appellants by filing Writ  Petition  No.5698/2008  in  the
High Court of Madhya Pradesh.

9.          This letter dated 23.9.2003 reads as follows:-
                 “           M.P. Government
                 Housing and Environment Department
                             Ministry

            Letter No.H-3-107/3/32 Bhopal          Date 23.09.2003

            To,
                 The Chief Executive Officer
                 Indore Development Authority
                 Indore, M.P.

           Sub:  Regarding grant of permission  to  Mangal  Amusement  Park
                 Pvt. Ltd. for the construction of Amusement  Club,  Banquet
                 Hall on the land allotted under plan No.54  of  the  Indore
                 Development Authority.


           Ref:  Your letter No.6314 dated 23.05.03.


           Please take reference of the letter  referred  above,  by  which
           Authority had sought permission from Govt. for proposal on  land
           allotted by Authority on lease 1994.


              2. It has been established from the documents  made  available
                 by the Authority that proceedings by the Authority have not
                 been in accordance with the rules and there has  been  lack
                 of transparency.  Therefore, it is  not  possible  to  give
                 permission on this proposal of Authority.


              3. It is directed to Authority that it  utilize  the  land  in
                 question only after  issuing  fresh  notification  inviting
                 tenders.



                                                            Sd/-
                                                        Illegible
                                                      23.09.03
                                                   (C.C. Padiyar)
                                                    Under Secretary
                                                       M.P. Govt.
                              Housing and Environmental Department”


10.         The notification dated 19.11.2003 reads as follows:-

                 “HOUSING & ENVIRONMENT DEPARTMENT
                       Vallabh Bhawan, Bhopal.

                       Bhopal dated 19th November, 2003.

                 No.F-3-47-0000-32  –  The   State   Government   vide   its
                 Notification No.F-3-47-2000-32 dated 9th March, 2001 issued
                 under Section 23(A) (2) of the  Madhya  Pradesh  Urban  and
                 Rural Act,  1973  (Act  No.23/1973)  had  proposed  certain
                 modifications in public interests.  Thereafter  notices  to
                 the  above  effect  were  also  published  in   2   leading
                 newspapers on 15th  ad  16th  March,  2001.   Through  said
                 notice, Objections were invited from the aggrieved  persons
                 and ultimately  4  objections  were  received  jointly  and
                 individually.  Thereafter objectors of the said  objections
                 were heard on 3.8.2001 and 23.8.2001 and  their  objections
                 were considered  and  were  finally  rejected.   Thereafter
                 Department sought an opinion from the Municipal Corporation
                 of Indore on the proposed modification  and  the  Municipal
                 Corporation has granted its No Objection vide letter  dated
                 1st June, 2001.

      (2)   In the premises  aforesaid,  State  Government  hereby  confirms
           modification of the following lands of  Village  Bhamori  Dubey,
           Indore, as described in Schedule  ‘A’  hereunder,  according  to
           user prescribed in the Indore Development scheme, 1991.   It  is
           further informed that this modification will  be  an  integrated
           part  of the Approved Indore Development Scheme, 1991 as well as
           Draft Development Scheme, 2011.

                                SCHEDULE ‘A’

                 Land  use  modification  of  18.222  Hectares  and   17.931
                 Hectares situated in Village  Bhamori  Dubey  under  Indore
                 Development Scheme, 1991-



|Sr.   |Survey   |Area (In |Land user   |Change land|
|No.   |No.      |Hect).   |prescribed  |use        |
|      |         |         |in the      |           |
|      |         |         |Indore      |           |
|      |         |         |Development |           |
|      |         |         |Scheme      |           |
|(1)   |(2)      |(3)      |(4)         |(5)        |
|1.    |257 & 259|9.134    |Regional    |Commercial |
|      |         |         |Park        |           |
|2.    |258 part |0.113    |- “ -       |“          |
|      |         |         |            |           |
|      |260      |1.000    |- “ -       |“          |
|3.    |261      |1.295    |- “ -       |“          |
|4.    |262      |1.474    |- “ -       |“          |
|5.    |264      |0.522    |- “ -       |“          |
|6.    |265      |2.429    |- “ -       |“          |
|7.    |265 part |2.255    |- “ -       |“          |
|      |         |18.222   |            |           |
|8.    |91 part  |0.713    |Regional    |Commercial |
|      |         |         |Park        |           |
|9.    |92/1     |0.429    |- “ -       |“          |
|10.   |92/2     |0.425    |- “ -       |“          |
|11.   |93/1     |1.060    |- “ -       |“          |
|12.   |93/2     |1.064    |- “ -       |“          |
|13.   |94/1     |0.235    |- “ -       |“          |
|14.   |94/2     |0.235    |- “ -       |“          |
|15.   |95/1     |0.219    |- “ -       |“          |
|16.   |95/2     |0.223    |- “ -       |“          |
|17.   |96/1     |0.117    |- “ -       |“          |
|18.   |96/2     |0.117    |- “ -       |“          |
|19.   |152      |0.174    |- “ -       |“          |
|20.   |155 part |0.267    |- “ -       |“          |
|21.   |157      |0.186    |- “ -       |“          |
|22.   |159      |0.344    |- “ -       |“          |
|23.   |160      |0.360    |- “ -       |“          |
|24.   |161      |0.170    |- “ -       |“          |
|25.   |162      |8.259    |Commercial  |Regional   |
|      |         |         |            |Park       |
|26.   |163      |1.967    |- “ -       |“          |
|27.   |164 part |0.607    |- “ -       |“          |
|28.   |165 part |0.534    |- “ -       |“          |
|29.   |166 part |0.226    |- “ -       |“          |
|      |         |17.931   |            |           |

                                     In the name of and by Order of Governor

                                                            Shivanand Dubey,
                                                           Deputy Secretary”


11.         The appellants point out that thereafter also the stand  of  IDA
was different from that of the concerned  department  as  reflected  in  the
Notesheet of IDA dated 3.2.2005.  Yet,  ultimately  it  accepted  the  view-
point of the State Govt., and issued a show cause notice to  the  appellants
on 8.1.2007 alleging  various  breaches  of  the  terms  and  conditions  of
allotment.  In para 7 and 8 thereof, it was alleged as follows:-

                 “7.   You have not taken  action  to  establish  Children’s
           Amusement Park on the  land  allotted  violating  conditions  of
           license.  Half of the land  is  still  undeveloped,  vacant  and
           without any use given after 12 years of allotment.

                 8.    Application for the construction of  Amusement  Club,
           Banquet Hall on the land allotted, given by you establishes that
           you do  not  want  to  run  activities  relating  to  Children’s
           Amusement Park on the land allotted.”

            The appellants were, therefore, asked to show cause  as  to  why
the license of land allotted to them should not be cancelled.

12.         It is the further case of  the  appellants  that  although  this
show cause notice was issued on 8.1.2007, the Chairman  of  IDA  once  again
wrote to the Govt. on 29.11.2007 asking it to retain the  land-use  of  this
particular parcel of land as commercial.  The State Govt. however  proceeded
to bring the modification into force with effect from 1.1.2008.   It  is  at
this stage that the above writ petition No. 5698 of 2008 was filed with  the
following prayers:-

      (a)   to strike down Section 23-A of Madhya Pradesh Nagar  Tatha  Gram
Nivesh Adhiniyam 1973 (which prayer was however not pressed),

      (b)   to quash the notification dated 19.11.2003, and

      (c)   to quash Govt.’s letter dated 23.9.2003 (which prayer was  added
later on).

13.   Contentions of the rival parties

      The principle submission of the appellants was three-fold:-

      (a)   the document of allotment of the concerned  parcel  of  land  to
the appellants was a document of lease and not simply a  license,  and  that
the appellants were entitled to the renewal thereof,

      (b)   the appellants had  made  good  investment  onto  the  concerned
parcel of land, and they had their legitimate  expectations.   Consequently,
the respondents were bound by the doctrine of promissory estoppel  to  renew
the allotment,

      And

      (c)   the decision to change the land-use was a malafide one  for  the
benefit of another party which had its  parcel  of  land  in  the  vicinity,
where the land-use was changed from the previous  one  which  was  ‘regional
park’, to ‘commercial’.  The change of use of land of  the  parcel  allotted
to the appellants was effected to set off the resultant reduction  in  green
area, and to justify the change of land-use of the parcel of  land  allotted
to the other party.

14.         The petition was opposed by respondent nos. 1 and 2 on  the  one
hand, and  by  respondents  no.3  and  4  by  filing  their  replies.   They
contended principally as follows:-

      (a)   the concerned document of allotment was clearly  a  document  of
license, and not that of lease.  In any case, by that  time  the  period  of
license having expired after the lapse of 15 years, the appellants  did  not
have any case for renewal particularly when they had not put to use half  of
the land for the purpose for which it was allotted, and when  in  fact  they
wanted to use it for another purpose by putting up a banquet hall therein.

      (b)   Inasmuch as, the document of allotment was a license  which  was
valid only for 15 years, there was no question of the  appellants  having  a
legitimate expectation for a renewal beyond 15 years.  The  respondents  had
not promised any such renewal to the appellants to enable them to  avail  of
the doctrine of promissory estoppel.

      (c)   The modification in the  development  plan  was  effected  after
considering all relevant factors and not for obliging anybody.  No  material
in support of their allegation had been produced  by  the  appellants.   The
change was effected after following the due process of  law,  viz.  inviting
suggestions and objections, and hearing the concerned parties.   The  change
cannot be faulted on that count either.

15.         The petition was  heard  by  a  Division  Bench  of  the  Madhya
Pradesh High Court which dismissed the same by its judgment and order  dated
19.5.2011, after hearing the counsel for all the parties.  This judgment  is
under challenge in the present appeal.

16.   Consideration of the rival submissions

            The principle question to be considered is  as  to  whether  the
document of allotment of land dated 6.5.1994 was in any way  a  lease  or  a
license.  As far as a lease is concerned, Section 105  of  the  Transfer  of
Property Act, 1882, defines it as follows:-

                  “105. Lease defined.- A lease of immoveable property is  a
      transfer of a right to enjoy such property, made for a  certain  time,
      express or implied, or in perpetuity, in consideration of a price paid
      or promised, or of money, a share of crops, service or any other thing
      of value, to be rendered periodically or on specified occasions to the
      transferor by the transferee, who accepts the transfer on such terms.

                 Lessor, lessee, premium and rent defined. – The  transferor
      is called the lessor, the transferee is called the lessee,  the  price
      is called the premium, and the money, share, service or other thing to
      be so rendered is called the rent.”

As far as a license is concerned, the same is defined under  Section  52  of
the Indian Easements Act, 1882, as follows:-

                  “52. “License” defined.  -  Where  one  person  grants  to
      another, or to a definite number of other persons, a right to  do,  in
      or upon the immovable property of the grantor, something which  would,
      in the absence of such right, be unlawful, and  such  right  does  not
      amount to an easement or an interest in the  property,  the  right  is
      called a license.”

      From these two definitions it is clear that a  lease  is  not  a  mere
contract but envisages and transfers an interest  in  the  demised  property
creating a right in favour of the lessee in rem.  As against that a  license
only makes an action lawful which without it would  be  unlawful,  but  does
not transfer any interest in favour  of  the  licensee  in  respect  of  the
property.

17.         The issue concerning the distinction between lease  and  license
came up for consideration before this court in Associated  Hotels  of  India
vs. R.N. Kapoor reported in AIR 1959 SC 1262.  In para 27 of  his  judgment,
Subba Rao,J.  (as he then was) observed therein as follows with  respect  to
lease:-

                 27.   There is a marked distinction between a lease  and  a
    license. Section 105 of the Transfer of Property Act defines a lease of
    immovable property as a transfer of a right to enjoy such property made
    for a certain time in consideration for a price paid or promised. Under
    Section 108 of the said Act, the  lessee  is  entitled  to  be  put  in
    possession of the property. A lease  is  therefore  a  transfer  of  an
    interest in land. The interest  transferred  is  called  the  leasehold
    interest. The lessor parts with his right to enjoy the property  during
    the term of the lease, and it follows from it that the lessee gets that
    right to the exclusion of the lessor…..”




Thereafter, the learned Judge referred to the definition  of  license,  then
observed as follows:-
                 “Under the aforesaid section, if a document  gives  only  a
    right to use the property in a particular way or  under  certain  terms
    while it remains in possession and control of  the  owner  thereof,  it
    will be a license. The legal possession,  therefore,  continues  to  be
    with the owner of the property, but the licensee is permitted  to  make
    use of the premises for a particular purpose. But for  the  permission,
    his occupation would be unlawful. It does not create in his favour  any
    estate  or  interest  in  the  property.  There  is,  therefore,  clear
    distinction between the two concepts. The dividing line is clear though
    sometimes it becomes very thin or even blurred.”

18.         Subba Rao, J., thereafter referred to the judgments of Court  of
Appeal in Errington V. Errington, 1952-1 All ER 149, and Cobb V. Lane, 1952-
1 All ER 1199, and then observed as follows:-

                 “The following propositions may,  therefore,  be  taken  as
    well-established : (1)  To  ascertain  whether  a  document  creates  a
    license or lease, the substance of the document must  be  preferred  to
    the form; (2) the real test is the intention of the parties  -  whether
    they intended to create a lease or  a  license;  (3)  if  the  document
    creates an interest in the property, it is a lease;  but,  if  it  only
    permits another to make  use  of  the  property,  of  which  the  legal
    possession continues with the owner, it is a license; and (4) if  under
    the document a party gets exclusive possession of the  property,  prima
    facie, he is considered to  be  a  tenant;  but  circumstances  may  be
    established which negative the intention to create a lease.”

      These propositions have been quoted with approval  subsequently  by  a
bench of three Judges in Konchanda  Ramamurty  Subudhi  (dead)  V.  Gopinath
Naik and Ors. reported in AIR 1968 SC 919, and  in  Capt.  B.V.  D’Souza  V.
Antonio Fausto Fernandes reported in AIR 1989 SC 1816.



19. (i)          Having seen this legal position, we  may  now  examine  the
submissions of the rival parties.  It was submitted by  Shri  Ranjit  Kumar,
learned senior counsel that, it has to be noted that though the document  of
allotment states that the license is granted initially for a  period  of  15
years, clause 8 thereof adds that it may be renewed for a further period  of
15 years by enhancing the license fee maximum  by  40%,  and  thereafter  at
such a percentage as may be decided by the authority.   This  indicated  the
permission to the allottee to remain on the concerned parcel of land  for  a
period of 30 years and more, and should therefore be construed  as  creating
an interest in the  parcel  of  land.   Therefore,  in  his  submission  the
document of allotment created a lease, and renewal thereof was a  matter  of
formality, and the IDA was bound to renew the document. He referred  to  the
judgment of this Court in Sudhir Kumar & Ors. vs. Baldev  Krishna  Thapar  &
Ors. reported in 1969 (3) SCC 611 to submit that a  lessor  cannot  withhold
his consent for renewal unreasonably.

(ii)   Shri Vikas Singh, learned senior counsel appearing for  IDA  and  Ms.
Vibha Datta-Makhija, learned counsel for the State Govt.  submitted  on  the
other hand that the possession of the allottee was merely a permissive  one,
and that it was not exclusive to warrant an  inference  of  creation  of  an
interest.  In their view,  the  document  of  allotment  when  read  in  the
entirety makes it very clear that it was a license and not a lease.





20.         In the instant case, if we peruse  the  document  of  allotment,
the following facts are noticed:-

(i)           The first clause does  provide  that  the  land  is  given  on
license initially for a period of 15 years, and clause 8 does lay down  that
the license may be renewed for a further period of  15  years  by  enhancing
the license fee maximum by 40%, and thereafter at such a percentage  as  may
be decided by the Authority.  We must,  however,  as  well  note  the  other
provisions in the document of allotment and their effect.

(ii)  In the instant case, the document of allotment is called a  ‘license’,
and the allottee is called a ‘licensee’.  In the very first  clause,  it  is
stated that the concerned parcel of land is given on license, and  clause  4
refers to the amount payable by the licensee as the license fee which is  to
be paid annually before the first of June.

(iii) Clause 11 of  the  document  requires  the  licensee  to  provide  the
specified games and rides in the amusement park.  Not only that  but  clause
10 further requires that the rides, games etc. should  be  bought  from  the
suppliers manufacturing them in India indigenously.

(iv)  Clause 7 authorises IDA to regulate the mode of  collection  of  entry
fee, and clause 5 provides that the amount equal to 25%  of  the  entry  fee
will be charged by the IDA  in  addition  to  the  license  fee.   Clause  7
further provides that the Authority (i.e IDA) or the officer  authorised  by
the Authority will have the power to examine the accounts of  collection  of
entry fee, as and when deemed fit.

21.         It must also be noted that the  concerned  document  has  to  be
read as a whole, and when we see the  above  clauses  together,  it  becomes
clear that IDA retained complete control over the concerned parcel of  land.
 The manner in which the  facilities  in  the  amusement  park  were  to  be
enjoyed was completely controlled by the IDA.  The IDA decided  as  to  what
games and rides were to be provided.  It also laid down  as  to  from  which
suppliers  these  games  and  rides  were  to  be  purchased.   IDA  further
regulated the mode of collection of entry fee, and had the right to  examine
the accounts of collection thereof as and when  it  deemed  fit.   Over  and
above, Clause 14 of the document specifically provided that in the event  of
violation of any of these terms and conditions on the part of the  licensee,
the decision of the Chairman of IDA will be final, indicating the  right  of
IDA to terminate the license in the event of such a contingency.   Obviously
when all these clauses are seen together, it becomes clear  that  there  was
no exclusive possession handed over to the appellants.  Thus,  the  document
of allotment merely granted a permission to  use  the  concerned  parcel  of
land in a particular manner, and  without  creating  any  interest  therein.
Hence, if we apply the tests which have been laid down  by  this  court  way
back in the year 1959 (and followed subsequently) the document will have  to
read as granting a license, and not a lease.

22.         The appellants had challenged the legality of  the  letter/order
dated  23.9.2003  issued  by  the  State  Government  to  the   IDA.    That
letter/order while declining the proposal of IDA  to  permit  the  amusement
club and Banquet Hall  proposed  by  the  appellant,  directed  the  IDA  to
utilize the land in  question  after  issuing  fresh  notification  inviting
tenders.  It was submitted that the IDA was in fact, favourably inclined  to
consider  the  proposal  of  the  appellants,  and  the  said   letter/order
indicated mala fides on  the  part  of  the  State  Govt.   It  was  further
submitted that IDA was a body corporate under Section 39 of  the  M.P.  Act,
and though section 73 empowers the State Government to  give  directions  in
matters of policy, this power cannot be exercised to give the directions  of
the kind contained in the letter dated 23.9.2003.   In  this  connection  it
was contended that assuming that the letter may not be found to be  vitiated
by reason of malice on fact, but still it can be held to be invalid  if  the
same had been issued for unauthorized purpose as it would amount  to  malice
in law. Reliance was placed in this behalf on the proposition  in  paragraph
40 of the judgment of this Court in Punjab State Electricity Board Ltd.  Vs.
Zora singh and Ors. Reported in 2005 (6) SCC 776.

23.          In our view, the appellants have tried to make much  ado  about
the stand which  the  IDA  took  on  earlier  occasions  in  favour  of  the
appellants.  One has to  recognise  that  where  different  authorities  are
dealing with a particular  subject,  it  is  quite  possible  that  on  some
occasions,  they  may  take  a  stand  different  from  each  other,  though
ultimately it is the decision of the competent authority which matters,  and
it cannot be tainted with mala fides merely on that  count.   The  following
observations of this Court in para 35 of Jasbir Singh  Chhabra  &  Ors.  vs.
State of Punjab reported in  2010  (4)  SCC  192  are  instructive  in  this
behalf:-

            “35. It must always be remembered that in a  democratic  polity
    like ours, the functions of the Government are carried out by different
    individuals at different levels. The issues and  policy  matters  which
    are required to be decided by the Government are dealt with by  several
    functionaries some of whom may record notings on the files favouring  a
    particular person or group of persons. Someone may suggest a particular
    line of action, which may not  be  conducive  to  public  interest  and
    others may suggest adoption  of  a  different  mode  in  larger  public
    interest. However, the final decision is required to be  taken  by  the
    designated authority keeping in view the larger  public  interest.  The
    notings recorded in the files cannot be  made  basis  for  recording  a
    finding that the ultimate decision taken by the Government  is  tainted
    by malafides or is influenced by extraneous considerations……”

24.         The High Court has held in para  23  of  the  impugned  judgment
that in any case admittedly the license had come to  an  end  by  efflux  of
time in the month of the June 2010, and therefore the validity and  legality
of the letter/order dated 23.9.2003 had  become  academic,  and  it  was  no
longer necessary to examine that issue.  We cannot find fault with the  High
Court on that account, since quashing of this letter cannot in any way  lead
to the renewal of the  license  which  had  already  expired.  Besides,  the
respondents had valid reasons not to renew the license as indicated  in  the
show cause notice dated 8.1.2007.  The construction of Amusement Club  or  a
Banquet Hall could certainly not be a part of a Children’s  Amusement  Park.
The parcel of land was allotted for setting up of  a  children’s  park  with
games and rides as indicated in  the  document  of  license.   Additionally,
what was permitted were the  food  and  beverages  centers,  kiosks,  shops,
administrative building and toilets, which would be in furtherance  of  this
objective. The Banquet Hall and an amusement club which  would  be  used  by
adults would not fit in  the  purpose  of  Children’s  Amusement  Park.   As
stated in clause 8 of the show cause notice, it clearly indicated  that  the
appellants did not want to  run  the  activity  related  to  the  Children’s
amusement park on the land allotted.

25. (i)          It was submitted on behalf of the appellants that they  had
made good investment  in  the  concerned  parcel  of  land  with  legitimate
expectations,  and,  therefore,   the   respondents   were   estopped   from
discontinuing their allotment on the basis of  the  doctrine  of  promissory
estoppel.  This submission was disputed by Shri Vikas Singh, learned  senior
counsel appearing for IDA.  He ,firstly, pointed out that more than half  of
the land remained un-utilised even 12 years after  the  allotment,  and,  in
fact, the park was not functioning for quite sometime.  The games and  rides
which were placed on this parcel of land were in  the  nature  of  fixtures,
and not permanent additions as such, and could  be  removed  therefrom  when
the appellants were required to vacate.

(ii)  Having noted these submissions we are  of  the  view  that  since  the
document of allotment was a license and not one creating any  interest,  the
provision of renewal contained therein cannot  be  read  as  laying  down  a
mandatory requirement.  Besides, as stated above, clause 14 of the  document
of license clearly stated that in the event  of  violation  of  any  of  the
terms and conditions on the part  of  the  licensee,  the  decision  of  the
Chairman of IDA was final.  Para 7 of the show cause notice in  fact  stated
that the necessary action to establish the  Children’s  Amusement  Park  had
not been taken since half of the  land  had  remained  undeveloped,  and  it
amounted  to  violating  the  conditions  of  license.   The   doctrine   of
promissory estoppel can certainly not be permitted to be invoked on  such  a
background.

26.(i)           The appellants had made one more  prayer  namely  to  quash
and set aside the notification dated 19.11.2003.  Section 23-A of  the  M.P.
Act permits the modification of the provisions in the  development  plan  by
following the due procedure of law as laid down  therein.   In  the  instant
case, a notification had  been  issued  earlier  on  9.3.2001  inviting  the
objections to the proposed modification.  The  appellants  were  heard  with
respect  to  these  objections,  and  thereafter  the   notification   dated
19.11.2003 had been issued approving  the  proposed  modification.   It  was
contended on behalf of the appellants that the modification was a  motivated
one.  The appellants submitted that under  the  modification,  a  parcel  of
land in nearby vicinity which was earlier reserved for  a  green  area,  was
now being permitted for a commercial use,  whereas  the  user  of  the  land
which was marked for the Children’s Amusement Park, was being changed  to  a
regional park.  This was with a view to accommodate the constructions  which
had come up on the other parcel of land in the vicinity.

(ii)  In this connection we must note that the  appellants  had  not  joined
any of those parties for whose benefit this change had been allegedly  made.
 As held in Girias Investment  (P)  Ltd.  vs.  State  of  Karnataka  &  Ors.
reported in 2008 (7) SCC 53, in the absence of factual basis, the  court  is
precluded from going into the plea of malafides.  As far as the  land  meant
for the Children’s amusement park is concerned, the same was hardly  put  to
the full use.  In as much as this entire parcel of land  of  about  7  acres
was not utilized, and since it  was  an  open  parcel  of  land,  there  was
nothing wrong in the State Government deciding  to  retain  it  as  an  open
parcel of land, and to change the land-use  thereof  from  commercial  to  a
regional park.  The notification cannot be faulted on that count either.

27.         In the circumstances, we do not find any error in  the  impugned
judgment of the High Court. The  appeal  is  therefore  dismissed.   Parties
will bear their own costs.

                                                   …………..……………………..J.
                                                ( Surinder Singh Nijjar )




                                                        …………………………………..J.
                                                ( H.L. Gokhale  )

New Delhi
Dated: 28th August, 2012
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