S.B. Sinha, C.J.
1. All these writ appeals arising out of the common judgment and order of the learned single Judge in WP Nos. 23773 and 33741 of 1998 and 9481 of 1999 were taken up for hearing together and are being disposed of by this common judgment
FACTS:
M/s. Mc Dowell and Company Limited is the petitioner in the aforementioned writ petitions. For convenience sake the parties will be referred to by their status in the writ petitions. The petitioner is a public limited company registered under the Companies Act, 1956 having its registered office at Chennai. It is a part of UB Group of Companies engaged in engineering, Tourism, brewerages etc. M/s. Hindustan Polymers Limited, Visakhapanatam is a company engaged in the manufacture of polystyrene, Styrene monomer etc. The said company was declared as a surplus landholder under the provisions of the Urban Land (Ceiling and Regulation) Act, 1976 (for short 'the Act') under Visakhapatnam agglomeration to the extent of 76.9585 hectares of land as published in A.P. Gazette on 24-12-1981. Subsequently, M/s. Hindustan Polymers Limited became sick and it was amalgamated with the petitioner-company by reason of the orders passed by the High Court of Bombay in CP No. 236 of 1981 and thereafter it continued to function as a business division of the petitioner-company.
2. By reason of G.O. Ms. No. 1033 Rev. (UC.III) Department dated 8-10-1992, the Government granted exemption in favour of M/s. Hindustan Polymers Limited to the extent of 27.0095 hectares and 34.8730 hectares of land situated in Venkatapuram and Vepagunta villages respectively and an extent of 1.0239 hectares situated in Gopalapatnam village in Visakhapatnam Urban Agglomeration for expansion of the existing industrial infrastructure for ABS Project etc. and also in respect of an extent of 4.3101 hectares at Waltair uplands in Visakhapatnam Urban Agglomeration for construction of residential accommodation for officers of Hindustan Polymers Division, U.B. Elastomers Limited and U.B. Petrochemicals Limited totalling to 67.2165 hectares of land subject to fulfilment of the conditions (a) to (i) specified in the order in exercise of the power under Clause (a) of Sub-section (1) of Section 20 of the Act. The Government by reason of Memo No. 18215/UC.III/93-3 dated 12-1-1994 issued show-cause notice to M/s. Hindustan Polymers Limited to show-cause as to why exemption granted in G.O. Ms. No. 1033 in respect of an extent of 4.3101 hectares of land situate in T.S. No. 1011/36 of Block No. 39 at Waltair Uplands should not be withdrawn under the provisions of Sub-section (2) of Section 20 of the Act for violation of the conditions imposed in the exemption order. The Government, however, on the representation made by M/s. Hindustan Polymers by reason of Memo No. 18215?UC.III/93-1 dated 25-11-1994 accorded extension of time by two years from the end of December, 1994 for complying with the said conditions. Again the Government issued show-cause notice to M/s. Hindustan Polymers Limited on 19-7-1996 to show-cause as to why the exemption granted in G.O.Ms. No. 1033 as also the extension of time of two years granted upto December, 1996 by memo dated 25-11-1994 insofar as the extent measuring 4.3101 hectares of land situate in Waltair Uplands and an extent of land measuring 1.0239.3340 hectares situate in Gopalapatnam village should not be withdrawn under the provisions of Sub-section (2) of Section 20 of the Act for violation of the conditions specified in G.O. Ms. No. 1033. In the said Memo, the Government noticed that U.B. Elastomers Limited and U.B. Petrochemicals limited have been shifted to Gujarat and the need for which exemption was granted no longer exists.
3. M/s. Hindustan Polymers Limited made a representation on 29-10-1996 stating that there were plans to expand the industry as one M/s. L.G. Chemical Limited belonging to L.G. Group, South Korea has come forward to invest to the tune of Rs. 100 crores in expansion and diversification plans in various polymer products and requested the Government to grant permission to transfer the land situated at Venkatapuram, Vepagunta and Gopalapatnam villages in public interest to LG Chemical Limited and for exemption of the same from the provisions of the Act. Request was also made to grant permission to develop Waltair uplands measuring 4.3101 of hectares into an ideal Holiday Resort. The Government thereafter by reason of G.O. Ms. No. 526 Revenue dated 21-6-1997 permitted transfer of lands viz., Venkatapuram village - 27.0095 hectares, Vepagunta village - 34.8730 and Gopalapatnam village - 1.0239 in favour of M/s. LG. Chemical Limited subject to the following conditions:
(a) that the proposed new investment of Rs. 100/- crores will be brought about within a period of three years from the date of issue of this orders;
(b) that it should not be leased out or sold without the prior permission of the Government;
(c) that the land should be utilised for the purpose of Petro Chemical Industry only within three years from the date of grant of permission failing which the permission granted shall stand cancelled and the said land will become subject to the provisions of the Urban Land (Ceiling and Regulation) Act, 1976 as excess land;
(d) that the land may be mortgaged to any Bank as defined in Clause (iii) of Sub-section (1) of Section 19 including A.P. State Financial Corporation for the purpose of raising finances for the industry;
(e) that the purchasing company should file statement under Section 15 of the Urban Land (Ceiling and Regulation) Act, 1976 before the Special Officer and Competent Authority, Urban Land Ceiling, Visakhapatnam.
4. However, the Government rejected the request of the Company for development of Holiday Resort over an extent of 4.3101 hectares of land situated at Waltair Uplands and indicated that separate orders will be issued in regard thereto. Government issued G.O. Ms. No. 567 Revenue dated 5-7-1997 amending G.O. Ms. No. 526 whereby the name of the company as Hindustan Polymers, a division of Mc Dowell and Company Limited was substituted in place on Hindustan Polymers Limited. By reason of G.O. Ms. No. 630 Revenue (UC.III) Department dated 26-7-1997 Government withdrawn the exemption granted in G.O.Ms. No. 1033 to the extent of land measuring 4.3101 hectares situated in Waltair Uplands, Visakhapatnam. Notification to that effect under Section 10(1) of the Act was issued on 9-10-1997 calling for objections. A notification under 10(3) of the Act was issued on 13-11-1997 stating that the Waltair Uplands measuring 4.3101 hectares shall be deemed to have been acquired by the State with effect from 24-10-1997 and that upon publication of the declaration, the land shall be deemed to have vested absolutely in the State Government free from all encumbrances with effect from 23-11-1997. According to the petitioner, the procedure as required under Sections 6 - 8 of the Act which is mandatory in nature has not been followed while issuing the notifications under Sections 10(1) and 10(3) of the Act. Though notice under Section 10(5) of the Act was issued to handover the possession of the land, but the company failed to handover the possession. Possession of the land, therefore, was taken on 16-1-1998 by the Mandal Revenue Officer under a panchanama. Thereafter, the 2nd respondent by reason of notice-dated 6-7-1998 initiated proceedings for payment of compensation to the petitioner-company under Section 11 of the Act. Aggrieved by the said proceedings, the petitioner filed WP No. 23773 of 1998 for a writ of mandamus declaring the action of the respondents in initiating proceedings under Section 6 of the Act without issuing order under Section 20(2) of the Act as illegal, arbitrary and violative of the principles of natural justice.
5. Thereafter the petitioners filed WP No. 33741 of 1998 challenging G.O. Ms. No. 630 dated 26-7-1997 and for a declaration that the notifications dated 9-10-1997 and 13-11-1997 issued under Sections 10(1) and 10(3) of the Act are arbitrary and ultra vires the provisions of the Act and also violative of the principles of natural justice.
6. On 26-4-1999 the petitioner filed the third writ petition seeking the following relief:
To issue a writ or order more particularly one in the nature of writ of mandamus declaring the property of the petitioner company of an extent of 4.3101 hectares in S. No. 1011/36, in Block No. 39, situated in Waltair Ward under Visakhapatnam Municipality, Visakhapatnam Urban Mandal, Visakhapatnam is outside the purview of the provisions of the Urban land ceiling Act 33 of 1976 in view of orders of exemption in G.O.Ms. No. 1033 Revenue (UC.III) dated 8-10-1992 and the Repealing Act 5 of 1999 dated 11-1-1999 published in Government of India Gazette extraordinary, part-II, and consequently declare the action of the respondents in initiating the proceedings under Sections 6 - 11 of the Act against the exempted land of the petitioners as illegal, arbitrary and ultra vires................
7. The learned single Judge by reason of the common order impugned in the present appeals allowed Writ Petition No. 3374I of 1998 setting aside G.O.Ms. No. 630 dated 26-7-1997 on the ground that no reason had been assigned by the Government as required under Section 20(2) of the Act while cancelling the exemption granted in favour of the petitioner and accordingly remitted the matter back to the Government for fresh consideration thereof after affording an opportunity of personal hearing and to pass appropriate orders within a period of three months from the date of receipt of copy of the order. The learned single Judge in his judgment had not gone into the other aspects of the matter. In view of the said directions, the learned single Judge was of the view that no orders are necessary in WP No. 23773 of 1998 and WP No. 9481 of 1999 and accordingly the said writ petitions were closed.
8. Aggrieved by the said orders, the State has preferred WA Nos. 1282, 1283 and 1284 of 2000. The petitioner has preferred Writ Appeal Nos. 1576 and 1630 of 2001 aggrieved by that part of the order of the learned single Judge closing the Writ Petitions 23773 of 1998 and 9481 of 1999.
Statutory Provisions:
Section 20 of the Act reads as follows:
Power to exempt :--(1) Notwithstanding anything contained in any of the foregoing provisions of this Chapter,--
(a) where any person holds vacant land in excess of the ceiling limit and the State Government is satisfied, either on its own motion or otherwise, that having regard to the location of such land, the purpose for which land is being or is proposed to be used and such other relevant factor as the circumstances of the case may require, it is necessary or expedient in the public interest so to do, that Government may, by order, exempt subject to such conditions, if any, as may be specified in the order, such vacant land from the provisions of this Chapter;
(b) where any person holds vacant land in the excess of the ceiling limit and the State Government, either on its own motion or otherwise, is satisfied that the application of the provisions of this Chapter would cause undue hardship to such person, that Government by order exempt subject to such conditions if any as may be specified in the order, such vacant land from the provisions of this Chapter:
Provided that no order under this Clause shall be made unless the reasons for doing so are recorded in writing.
(2) If any time the State Government is satisfied that any of the conditions subject to which any exemption under Clauses (a) and (b) of Sub-section (1) is granted is not complied with by any person, it shall be competent for the State Government to withdraw, by order, such exemption after giving a reasonable opportunity to such person for making a representation against the proposed withdrawal and thereupon the provisions of this Chapter shall apply accordingly.
Submissions of the State: The learned Advocate-General drawing our attention to the provisions of Sub-sections (1) and (2) of Section 20 of the Act contended that whereas in terms of the proviso appended to Sub-section (1) of Section 20 reasons are required to be recorded in writing where Government is inclined to pass an order exempting the vacant land from the provisions of the Act, no such requirement exists when an order withdrawing the exemption granted under Sub-section (1) was required to be passed in terms of Sub-section (2) of Section 20. He would urge that the order in G.O.Ms. No. 526 dated 21-6-1997 rejecting the request of the petitioner for development of Holiday Resort over an extent of 4,3101 hectares situated at Waltair Uplands having not been challenged, the consequential order issued in G.O. Ms. No. 630, dated 26-7-1997 impugned in WP No. 33,741 of 1998 could not have been challenged. Non-fulfilment of the conditions, the learned Advocate-General would contend, having been admitted, it was not necessary to assign detailed reasons in support of the impugned order. It was not a case, contends the learned Advocate-General, where bona fide of the appellants is in question. In any event, the violation of the conditions of exemption granted in G.O. Ms. No. 1033 dated 8-10-1922, having been admitted, the exemption granted in relation to the entire extent of land stood automatically cancelled, although by reason of the orders passed in G.O. Ms. No. 526 dated 21-6-1997, the Government had shown indulgence for transfer of the lands in relation to Venkatapuram, Vepagunta and Gopalapatnam villages in favour of M/s. L.G. Chemicals Limited by the writ petitioners.
9. The learned Advocate-General in support of the aforementioned contentions has placed strong reliance upon the decisions of the Apex Court in Rajendra Singh v. State of M.P., : AIR1996SC2736 and Mansukhlal Vithaldas Chauhan v. State of Gujarat, : 1997CriLJ4059 .
Submissions of the learned Counsel for the Petitioners:
The principles of natural justice, the learned Counsel would contend, are required to be complied with by the State even in regard to its decision making process under Sub-section (2) of Section 20 of the Act. Such a requirement by necessary implication is to be complied with, as a result thereof, assignment of reasons, in support of the impugned order was imperative. The learned Counsel would contend that in the fact of the present case, assignment of reasons was all the more necessary as from the impugned order it would appear that the same has been passed on the basis of the recommendations of the Collector wherein a finding has been arrived at that the petitioner-company had committed breach of conditions of the order granting exemption. Learned Counsel in support of his contentions relied upon the decisions of the Apex Court in Babulal Nagar v. Shree Synthetics Limited, : [1984]3SCR772 , Neelima Misra v. Harinder Kaur Paintal, : AIR1990SC1402 , T.R. Thandur v. Union of India, : AIR1996SC1643 , and Krishna Swami v. Union of India, : AIR1993SC1407 . The learned Counsel would further contend that a Court of Appeal would not interfere with an order of remand. Drawing the attention of the Court to Section 23 of the Act which deals with disposal of vacant land acquired under the Act, it was submitted that carrying on business would come within the purview of the definition 'industry' as envisaged under the explanation (b) appended to Section 23 of the said Act and the State having accepted the plea of the Company as regards its inability to set up the industries, there was no reason as to why exemption should not be granted in respect of 4.3101 hectares of land situate at Waltair Uplands which was meant for construction of residential quarters for the workmen; insofar as no project could be brought about, the question of construction of residential quarters for the workmen would not arise. In any event, contends the learned Counsel that having regard to the terms and conditions of the exemption notification as the said area has to be kept vacant, the question of contravention of any conditions of grant of exemption did not arise. The learned Counsel would contend that keeping in view the provisions of Section 23 of the Act, this Court should direct grant of exemption as the company is interested in starting an industry therein. In support of the said contention, strong reliance has been placed on the decision of the Apex Court in Muthulakshmi Achi v. Meenakshi Achi, JT 1993 (4) 494. As regards writ appeal No. 1576 of 2001 wherein the vires of the Act had been challenged, the learned Counsel did not press the same.
Findings :
The principles of natural justice has two basis pillions, (i) audi alteram parterm and (ii) nemo index in causa sua. Assignment of reasons is an extension of the principles of natural justice. By reason of judicial decisions, however, assignment of reasons has become part of the principles of natural justice in certain spheres. There is no general rule of law that apart from the statutory requirement, an administrative body or a statutory tribunal is required to give reasons for its decision in every case.
10. In R. v. Northumberland Compensation Appeal Tribunal, ex. P. Shaw, (1952) 1 KB 338 = (1952) 1 ALL ER 122 Denning, LJ, was of the opinion that 'the record must contain at least the document which initiates the proceedings, the pleadings, if any, and the adjudication, but not the evidence, nor the reasons, unless the tribunal chooses to incorporate them. If the tribunal does state its reasons, and those reasons are wrong in law, certiorari lies to quash the decision.' In Padfield v. Minister of Agriculture, Fisheries and Food, (1968) 1 ALL ER 694, it was held that Minister was not bound to give his reasons for refusing to exercise his discretion in a particular manner. The law prevailing in Canada on the issue is same as in England. (See Pure Spring Company Limited v. Minister of National Revenue, (1947) DLR 501 at 539 and RE: R.D.R. Construction Limited and Rent Review Commission, (1983) 139 DLR (3D) 168. In Australia also, it does not stand on different footing. (See Osmond v. Public Service Board of New South Wales, (195/85) 3 NSWR 447, and Public Service Board of New South Wales v. Osmond, (1986) 63 ALR 559.
11. Paul Jackson in his treatise on 'Natural Justice', second edition at page 95 states:
The importance of the need for justice to be seen to be done might also be thought to be relevant in any discussion of whether natural justice requires that reasons be given for decisions. In Fountaine v. Chesterton, (1968) 112 SJ 690, Megarry J, said that a right to know the reasons for a decision did not form part of natural justice. More recently the same learned Judge has said, 'It is clear that there is no general obligation to give reasons for a decision'. McInnes v. Onslow Fane, (1978) 3 ALL ER, 211, 219. The correctness of the learned Judge's statement of the law is unarguable. Thus Magistrates are not, normally, under a duty to give reasons for their decisions, administrative bodies, similarly, have been held not to be under any such duty. But, equally there is no doubt that in many circumstances, there is a duty to give reasons and that the Courts and the Legislature increasingly recognise the desirability of such a duty. In v. Times Newspaper, (1973) 1 WLR 448, 455, For Example, Cairns L.J. said that in deciding whether to order a trial by Jury or by Judge alone, 'The fact that a Judge has to give reasons for his decisions is to my mind a point in favour of trial by Judge alone.'
Principles of natural justice as is well known does not stand on a rigid formulae. It must be viewed in circumstantial flexibility. The principles of natural justice have undergone a sea change. Recently in P. Eswaraiah v. State of A.P. 2001 (4) ALD 644 (DB), this Bench has reiterated the position upon taking into consideration a large number of decisions.
12. We may also usefully refer to a decision of the Apex Court in Sachidanand Pandey v. State of West Bengal, AIR 1987 SC 1109.
13. In Union of India v. V.E.G. Nambudri, : (1991)IILLJ594SC , the law is stated in the following terms:
There is no dispute that there is no rule or administrative order for recording reasons in rejecting a representation. In the absence of any statutory rule or statutory instructions requiring the competent authority to record reasons in rejecting a representation made by a Government servant against the adverse entries the competent authority is not under any obligation to record reasons. But the competent authority has no licence to act arbitrarily, he must act in a fair and just manner. He is required to consider the questions raised by the Government servant and examine the same, in the light of the comments made by the officer awarding the adverse entries and the officer countersigning the same. If the representation is rejected after its consideration in a fair and just manner, the order of rejection would not be rendered illegal merely on the ground of absence of reasons. In the absence of any statutory or administrative provision requiring the competent authority to record reasons or to communicate reasons, no exception can be taken to the order rejecting representation merely on the ground of absence of reasons. No order of an administrative authority communicating its decision is rendered illegal on the ground of absence of reasons ex facie and it is not open to the Court to interfere with such orders merely on the ground of absence of any reasons. However, it does not mean that the administrative authority is at liberty to pass orders without there being any reasons for the same. In Governmental functioning before any order is issued the matter is generally considered at various levels and the reasons and opinions are contained in the notes on the file. The reasons contained in the file enable the competent authority to formulate its opinion. If the order as communicated to the Government servant rejecting the representation does not contain any reasons, the order cannot be held to be bad in law. If such an order is challenged in a Court of law it is always open to the competent authority to place the reasons before the Court which may have led to the rejection of the representation. It is always open to an administrative authority to produce evidence aliunde before the Court to justify its action.
14. Section 20 of the said Act is in two parts. The power of the State to grant exemption in respect of any person from the provisions of the Act from holding vacant land in excess of the limit are circumscribed by the factors enumerated under Sub-section (1) of Section 20 of the Act. Such exemption will be granted subject to such conditions as may be specified in the order. Such exemption orders are passed, by way of exception to the general rule having regard to the purport and object of the said Act which was enacted for imposing ceiling on agriculture property in urban areas having regard to the growth of population and urbanisation so that the need for orderly development of urban areas may be met. It was in that context that the proviso appended to Sub-section (1) mandating the authorities to record reasons in writing for grant of exemption must be viewed. Sub-section (2) of Section 20 on the other hand empowers the State to withdraw the order of exemption granted under Sub-section (1) if the Government satisfied that any of the conditions subject to which the exemption under Clauses (a) and (b) of Sub-section (1) has been granted had not been complied with. Once such a decision is arrived at, the State is empowered to withdraw such exemption by passing order after giving a reasonable opportunity for making a representation against the proposed withdrawal. However, no personal hearing to the person concerned is required to be given. In our considered view, the proviso appended to Sub-section (1) cannot be made applicable in a case where the Government exercises its power under Sub-section (2) of Section 20 of the Act.
15. The general principle governing the doctrine of natural justice although would require assignment of sufficient and cogent reasons, the intent and purport of the Legislature is apparent that whenever vacant land is found to be in excess, the same in terms of the provisions of law must vest in the State. The object of the Act is that such vested lands should be utilised for public purpose. The maximum compensation, which is required to be paid for vesting of such lands, is two lakhs. In the proceedings issued pursuant to the declaration made by the Company i.e., 76.9585 hectares of land was found to be in excess of the ceiling limit. The Company surrendered only twenty acres of land. On the basis of the recommendation of the Commissioner of Land Reforms and Urban Land Ceilings, Hyderabad, Government by reason of G.O. Ms. No. 1033, dated 8-10-1992 granted exemption. The relevant portion of the order reads thus:
Now, therefore, in excise of the powers conferred by Clause (a) of Sub-section (1) of Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 (Central Act 33 of 1976), the Governor of Andhra Pradesh hereby exempts the lands measuring an extent of 27.0095 hectares and 34.8730 hectares situated at Venkatapuram and Vepagunta villages respectively and an extent of 1.0239 hectares situated in S. No. 7/B in Gopalapatnam village in Visakhapatnam Urban Agglomeration for expansion of the existing industrial infrastructure for ABS Project and Styrene/Polystyrene projects and also an extent of 4.3101 hectares at Waltair Uplands in Visakhapatnam Urban Agglomeration or construction of residential accommodation for officers of Hindustan Polymers Division as well as U.B. Plastomers Limited and U.B. Petrochemicals Limited subject to the following conditions.
16. Therefore exemption was granted by the Government in respect of an extent of 67.2165 hectares of land for the purpose of expansion of two existing industries and also for the purpose of construction of residential accommodation for officers of Hindustan Polymer Division etc. The parties were aware that 4.3101 hectares of land at Waltair Uplands was available but even exemption in relation thereto was granted keeping in view the necessity for construction of residential quarters for the officers and workmen of Hindustan Polymers Division etc. The relevant conditions for such exemption, inter alia are:
(a) The work on the A.B.S. Project and Styrene/Polystyrene Projects should be started within six months and completed before the end of 1994.
(b) The company shall submit a report to both the Commissioner of Land Reforms and Urban Land Ceiling as well as the Commissioner of Industries every six months indicating the progress of the project.
(c) The Company shall commence construction of residential accommodation for the workers within 6 months and shall submit progress report every six months to Commissioner of land Reforms and Urban land Ceiling;
(d) The Company shall obtain, within one year, the necessary proposals for the Butyl Rubber Project (UB. Elastomers Limited) and Naptha Cracker Project (U.B. Petrochemicals Limited) within one year. They shall also submit a report within 3 months to the Commissioner of Land Reforms and Urban Land Ceilings and the Commissioner of Industries as to the detailed schedule for implementation of these projects and shall execute the projects accordingly.
(e) The Company shall not utilise the land at Waltair Uplands but keep it in the present condition till such time as the ABS and for Styrene/Polystyrene Projects as well as the quarters for Workmen of Hindustan Polymers Limited are completed. Thereupon, the company shall not utilise more than two hectares of this land for construction of residences for officers of the Hindustan Polymers. They shall utilise the balance land only after the Butyl Rubber Project and Naptha Crackers Project as well as the residential accommodation for workmen for these projects is well under way;
(f) That the company shall not alienate the lands under any circumstances by sale or otherwise;
(g) Failure to comply with any or all of these conditions shall render the exemption void;
(h) that the land should be utilised for the purpose for which it is retained failing which the exemption granted shall be liable for cancellation and the exempted land will be subject to the provisions of the Urban Land (Ceiling and Regulation) Act, 1976.
17. The admitted fact remains that the conditions laid down in the order of exemption had not been complied with by the petitioners. A show-cause notice for withdrawal of the exemption was issued on 12-1-1994. The petitioner-company sought for extension of time to comply with the conditions by representations dated 24-2-1994, 18-7-1994 and 22-8-1994. Such a request was complied with. The fact that the conditions of grant of exemption had been violated had neither been denied nor disputed. The Government in Memo No. 18215/UC.III/93-1, dated 25-11-1994, specifically stated:
Government accordingly hereby accord extension of time of two years from the end of December, 1994 to M/s. Hindustan Polymers Limited exempted in G.O. Ms. No. 1033, Revenue (UC.III) Department, dated 8-10-1992 so as to utilise the land for the purpose for which exemption was granted, subject to condition that the exemption granted in the above G.O. shall stand cancelled, if the company fails to satisfy the conditions imposed in G.O. Ms. No. 1033, Revenue (UC.III) Department dated 8-10-1992.
18. Admittedly, the conditions laid down for grant of exemption had not been complied with even within the aforementioned period. Despite the fact that in terms of the aforementioned provisions, the grant of exemption was to be automatically cancelled, the State though it fit to issue a show-cause notice dated 19-7-1996 pointing out infraction of the conditions contained in G.O.Ms. No. 1033 by the company. The Company did not file any explanation stating that the conditions had not been violated. However, by representation dated 29-10-1996, it sought for permission to alienate the lands at Venkatapuram, Vepagunta and Gopalapatnam villages in favour of M/s. L.G. Polymers Limited. Therein request was also made to delink Waltair Uplands from the composite exemption order and to grant permission to construct a Holiday Resort instead of residential quarters for employees of the aforementioned industries. It was stated:
Delink the Waltair uplands covered by TS.NU.1101/36 from the composite extension granted vide G.O.Ms. No. 1033, dated 8-10-1992 and permit Mc.Dowel to develop the same into an Ideal Holiday Resort.
19. Therefore, what the company sought for was a fresh grant of exemption.
20. The legality of the impugned order must be considered in the aforementioned backdrop. In G.O.Ms. No. 526, dated 21-6-1997, while conceding the request of the Company to accord permission to transfer the land in favour of LG. Polymers, it was categorically stated:
The Government hereby reject the request of M/s. Hindustan Polymers Limited, Visakhapatnam for development of Holiday Resort over an extent of 4.3101 Hectares situated at Waltair Uplands. Orders in this regard will be issued separately.
21. Thereafter the Government issued the impugned G.O. Ms. No. 630, dated 26-7-1967 withdrawing the exemption. Referring to G.O.Ms. No. 526 dated 21-6-1997 it was stated.:
And, whereas, the Government after careful examination of the matter have issued orders in the G.O. 5th read above permitting M/s. Hindustan Polymers Limited, Visakhapatnam (now L.G. Polymers India Private Limited, Visakhapatnam) to transfer the land situated at Venkatapuram, Vepagunta and Gopalapatnam in favour of M/s. LG. Chemicals (India) Private Limited for the purpose of expansion of existing industry subject to certain conditions, but rejected the request of Hindustan Polymers Limited, Visakhapatnam (now L.G. Polymers India Private Limited, Visakhapatnam) for development of Holiday Resort in an extent of 4.3101 hectares situated in Waltair Uplands;
Now, therefore, in exercise of the powers conferred by Sub-section (2) of Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 (Central Act 33 of 1976) the Governor of Andhra Pradesh hereby withdraw the orders issued in G.O. Ms. No. 1033, Revenue (U.C.III) Department, dated 8-10-1992 granting exemption to an extent of land measuring 4.3101 hectares situated in Waltair Uplands, Visakhapatnam in Visakhapatnam Urban Agglomeration in favour of M/s. Hindustan Polymers Limited, Visakhapatnam (now L.G. Polymers India Private Limited, Visakhapatnam).
22. In the aforementioned fact situation, we are of the opinion that even the principles of natural justice were not required to be complied with. It was not a case where violation of the conditions of the order of grant of exemption had been denied or disputed. Violation of the conditions stood admitted. The company prayed for exemption in relation to 4.3101 hectares of land to develop the Waltair Uplands into a Holiday Resort of international standard, if necessary, by involving an international collaborator. Strictly speaking, the situational fairness did not demand even compliance of principles of natural justice. Reasons for passing the impugned order are self-evident from various orders passed by the Government from time to time and the documents on record. Section 58 of the Evidence Act postulates that facts admitted need not be proved. The factual situation herein is undisputed. In our view, even the principles of natural justice are not required to be complied with far less any reasons are to be recorded.
23. The satisfaction that was required to be arrived at although was to be based on an objective criteria, such objective criteria as regards the requirement to pass the order are apparent on the face of record itself. In a situation of this nature, substantial compliance of principles of fairness in State action would meet the requirement. In Rajendra Singh v. State of M.P., the Apex Court dealing with the matter of cancellation of liquor licence, approved the following observations of a Division Bench of the Madhya Pradesh High Court:
The Court cannot take a hyper-technical view of the provisions and must understand the same in a reasonable manner. Substantial compliance with the requirements of the provisions would meet the ends of justice. Where a specific order of cancellation of licence is not passed but if the requirements are substantially complied with, the Court under Article 226 of the Constitution would not ordinarily interfere.
The Apex Court held:
While examining complaints of violation of statutory rules and conditions, it must be remembered that violations of each and every provision does not furnish a ground for the Court to interfere. The provision may be a directory one or a mandatory one. In the case of directory provisions, substantial compliance would be enough. Unless it is established that violation of a directory provision, has resulting in loss and/or prejudice to the party, no interference is warranted. Even in the case of violation of a mandatory provision, interference does not follow as a matter of course. A mandatory provision conceived in the interest of a party can be waived by that party, whereas a mandatory provision conceived in the interest of public cannot be waived by him. In other words, wherever a complaint of violation of a mandatory provision is made, the Court should enquire-in whose interest is the provision conceived. If it is not conceived in the interest of public, questions of waiver and/or acquiescence may arise-subject, of course, to the pleadings of the parties.
24. Yet again in Mansukhlal Vithaldas Chauhan v. State of Gujarat (supra), the Apex Court held:
This principle was reiterated in Tata Cellular v. Union of India, : AIR1996SC11 , in which it was, inter alia, laid down that the Court does not sit as a Court of Appeal but merely reviews the manner in which the decision was made particularly as the Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted, it will be substituting its own decision which itself may be fallible. The Court pointed out that the duty of the Court is to confine itself to the question of legality. Its concern should be:
1. Whether a decision-making authority exceeded its powers;
2. committed an error of law;
3. committed a breach of the rules of natural justice;
4. reached a decision which no reasonable Tribunal would have reached; or
5. abused its powers ?
25. There cannot be any doubt whatsoever as has been held in the decision of the Supreme Court in T.R. Thandur v. Union of India (supra) that before a statutory order is passed there should be an application of mind. But, in the instant case, justice has not only been done but apparently seem to be done. In Neelimia Misra v. Harinder Kaur Paintal, the Apex Court has noticed that the shift now is to a broader notion of 'fairness' or 'fair procedure' in the administrative action. The duty is not so much to act judicially as to act fairly, wherefor adjudicative settings are not necessary.
26. The lands in question are situated in the heart of Visakhapatnam city and they are worth crores of rupees. The period for which the exemption had been granted is not specified. The State even could cancel the exemption particularly having regard that the company had shifted its industry to Gujarat. But the State had shown enough indulgence to the company by giving permission to transfer the lands in favour of a third party which may be held to be not in public interest.
27. In Krishna Swami v. Union of India, (supra) the Apex Court was dealing with matter of removal of a Supreme Court Judge. 108 Members of Ninth Lok Sabha gave notice of motion to the Speaker for the removal of the learned Judge from the office of the Judge. Observing that the Speaker merely discharges the functions of high constitutional responsibility, it was held:
His decision to admit the motion to remove the Judge of the Constitutional Court for absence of reasons stated or staring from the record is not violative of Article 14 or Article 21 of the Constitution nor offends the principles of natural justice.
28. The above decision has no application to the facts of the present case.
29. Yet again in State Government Houseless Harijan Employees Association v. State of Karnataka, (2001) 1 SCC 610, the Apex Court merely held that the requirements of natural justice will be read into statutory provisions unless excluded expressly or by necessary implication. There is no dispute with regard to the said principle of law. However, we may notice that in terms of the aforementioned proposition, even the principle in its entirety or in part may be excluded by statute. It has been so done by the Legislature in the instant case inasmuch as while recording of reasons has been made compulsory in terms of the proviso to Sub-section (1) of Section 20 of the Act where the State was empowered to grant exemption, such mandate has not been made compulsory for passing an order under Sub-section (2) of Section 20 of the Act. When the proviso appended to Sub-section (1) was read in its entirety, it must be held that detailed reasons in writing are not required to be recorded for passing an order of withdrawal of exemption under Sub-section (2) of Section 20 of the Act. Recording of reasons is only required to be adhered to in case where Government is inclined to grant exemption of any land found in excess of the ceiling limit from the provisions of the Act in favour of any person.
30. We cannot also accept the submission of the learned Counsel for the petitioners to the effect that the learned single Judge has merely passed an order of remand and thus this Court should not exercise its discretionary jurisdiction under Clause 15 of the Letters Patent. The learned Judge has quashed the impugned order by issuance of a writ of Certiorari. The parties have raised substantial questions as regards the interpretation of the provisions of Section 20 of the Act as also the extent of power of judicial review. Therefore, this Court can go into the merits of the case. The decision of the Apex Court in Babulal Nagar v. Shree Syntehtics Limited, AIR 1984 SC 1164, relied upon by the learned Counsel for the petitioners was a case where the appellants therein were dismissed by the Management on alleged misconduct. The Labour Court upheld the same, but the Industrial Court on revision reversed the same on the ground that the enquiry was biased and unfair and set aside the orders of the Labour Court and remanded the matter to the Labour Court for fresh consideration. However, a Division Bench of the Madhya Pradesh High Court interfered with the same on the ground that the Industrial Court exceeded its jurisdiction by interfering with the findings of fact. In that context, it was held that the interference by the High Court with the order of remand in exercise of its jurisdiction under Article 226 was improper. Having regard to the facts and circumstances of the instant case, the decision of the Apex Court has no application. The learned single Judge remanded the matter entirely in different circumstances and on an application of a legal principle. No findings of fact are involved herein. It is appreciation of a pure question of law and this Court is well within its precincts to deal with the same. Hence, no reliance can be placed on the aforesaid decision.
31. Recourse to the provisions of Section 23 of the Act for the purpose of grant of exemption, in our opinion, is impermissible. Section 23 deals with the disposal of vacant land acquired under the Act. It, therefore, operates in different field. It becomes operative only when the lands vested in the State. It is merely an enabling provision. Only because such enabling provision exists, the Court can neither issue a writ or order in the nature of writ of mandamus directing the State to pass an order in terms of Sub-section (1) of Section 20 of the Act nor can it set aside the impugned order having regard to the fact that the company has an intention to set up a Holiday Resort. Under Section 23 of the Act, the Government was empowered to allot the land acquired under the provisions of the Act to any industry or for providing residential accommodation to the employees of any industry. Therefore, unless the land is vested in the Government, the question of allotment of the land for the purpose indicated in Section 23 does not arise. Herein, it is not a case where the land had vested in the Government and the petitioner-company had made an application for allotment of the land under Section 23 of the Act for the purpose of establishing Holiday Resort or any industry, it is a case where the Government granted exemption under Section 20(1) of the Act exempting the vacant land possessed by the petitioner-company in excess of the ceiling limit from the provisions of the Act subject to certain conditions. For non-compliance of such conditions even after extension of time, the impugned order has been passed withdrawing the order of exemption. Such order of exemption cannot be read into the provisions of Section 23 of the Act. While the provisions of 20 of the Act envisages grant of exemption of excess land from the provisions of the Act or withdrawal of the exemption granted, as the case may be, Section 23 envisages allotment of vacant land acquired under the provisions of the Act in the manner prescribed thereunder. Therefore, both the provisions operates entirely in different fields and, in our view, one provision cannot be taken to the aid of the other. Such reading down of the provisions would be contrary to the intent and object of the Act. The decision of the Apex Court in Muthulakshmi Achi v. Meenakshi Achi, JT 1993 (4) 494, relied upon by the learned Counsel for the petitioner has no application to the facts of the present case.
32. For the reasons aforesaid, we are of the view that the learned single Judge has erred in setting aside the impugned order of the Government on the ground that it was not supported by reasons. It is not a case where the impugned order has come all of a sudden as a bolt from the blue. The order of grant of exemption passed in G.O.Ms. No. 1033, dated 8-10-1992 has culminated into the order of withdrawal of rejection by the impugned order in respect of the land measuring 4.3101 hectares of land situated at Waltair Uplands for violation of the conditions specified in the order of exemption which fact had never been denied or disputed by the petitioners. When all facts are admitted and borne by the record, in our view, no reasons need be supplemented to a formal order to be passed by the State, even assuming that the principles of natural justice are required to be followed by recording reasons in such cases.
33. Another aspect of the matter is that the extent of 4.3101 hectares situate at Waltair Uplands in respect of which exemption had been granted by the State was required to be utilised for the purpose of construction of residential accommodation to the Officers of the Hindustan Polymers, UB Elastomers and UB Petrochemicals. It may be that for some reason or the other those industries could not be established; consequently the land could not be utilised for the purpose for which it was exempted. But, the proposal now set up by the petitioners for conversion of the Waltair Uplands into a Holiday Resort was entirely a new proposal. Since the purpose for which the land was exempted from the provisions of the Act by reason of G.O.Ms. No. 1033 having not been fulfilled, the State was not bound to accept the new proposal put forth by the petitioner. Once the conditions of exemption are violated, it is open for the State to pass an order of withdrawal of exemption as required under Sub-section (2) of Section 20 of the Act, particularly, when it had been clearly indicated in the Memo dated 25-11-1994 issued by the Government while extending the time limit for two years i.e., till the end of December, 1996, that the exemption granted in G.O. No. 1033 shall stand cancelled if the company fails to satisfy the conditions imposed. It is not the case of the petitioners that they are willing to fulfil conditions imposed in G.O.Ms. No. 1033 and sought for time and inspite of the same, the Government passed the order of withdrawal. In such an event, in our view, the Government, before passing an order of withdrawal, may be required to assign its reasons for passing the order of withdrawal. But, it is not so. In this view of the matter, we are unable to endorse the view taken by the learned single Judge and the impugned judgment cannot be sustained.
34. The fact that the residential accommodation for the workmen of the industries could not be brought about, whether on account of the fact that the industries as envisaged in the conditions mentioned in G.O. Ms. No. 1033 could not be established due to subsequent developments or due to the fact that financially they are not viable, does not come in the way of the Government withdrawing the permission, once it is found as a fact and admitted by the petitioners that the conditions have been violated. The contention of the petitioners that the Government having accepted the reasons assigned by the petitioner-company for not establishing the industries due to various constraints and also having permitted the petitioner to transfer the lands situate in Venkatapuram, Vepagunta and Gopalapatnam villages in favour of M/s. L.G. Chemicals, ought to have permitted it to establish the Holiday Resort at Waltair Uplands also has no merit. In our view, the said aspect cannot be gone into by this Court. This Court, in exercise of its jurisdiction under Article 226 of the Constitution cannot enter into such areas as the same is exclusively within the discretion of the Government. What weighed in its wisdom not to accept the proposal of the petitioner-company to establish the Holiday Resort and to proceed with the withdrawal of the permission is exclusively within the domain of the Government, and, this Court, in exercise of its discretionary jurisdiction, cannot substitute its opinion to that of the Government by appreciating the record.
35. The question of following the procedure under Sections 6, 8 and 9 of the Act does not arise at the stage of withdrawal of the exemption. Such procedure is required to be followed only when a declaration under Section 6(1) has been filed.
36. For the views we have taken, the impugned judgment of the learned single Judge is set aside, consequently, Writ Appeal Nos. 1282, 1283 and 1284 preferred by the State are allowed. Writ Appeal Nos. 1576 and 1630 of 2001 are dismissed. Having regard to the facts and circumstances of the case, there shall be no order as to costs.