Grant Of NOC For Land Use Does Not Give Immunity To Landowner Against Acquisition, Principle Of Promissory Estoppel Not Attracted: P&H High Court

The Punjab and Haryana High Court recently made certain important observations as to the non-applicability of promissory estoppel against government on grant of NOC with respect to land use, vis-a-vis a subsequent acquisition for "public purpose" under the Land Acquisition Act, 1894.A Division bench of Chief Justice Ravi Shanker Jha and Justice Arun Palli observed,"Once permission is granted/NOC is granted for setting up of college and thereafter, State cannot acquire it for all time to come, this may lead to an anomalous situation which may not be in the larger public interest and would amount to "public interest" making way for "private interest" which is not permissible at any costs/under any circumstances...doctrine of "legitimate expectation" or the principle of "promissory estoppel" can't be pressed into service where the public interest is likely to suffer as against the personal interest of a party."The brief facts of the case are: Petitioners were granted permission to set up a school and the NOC was issued to set up the B.Ed. College by the State Government on a certain piece of land. The state government later acquired the same piece for development of Industrial Model township to be developed as an Integrated complex for industrial, residential, recreational and other public utilities. The petitioners challenged this acquisition by the state government under the Land Acquisition Act, 1894. The High Court while hearing the case decided as follows: Grant of NOC/ licence/ CLU does not give the landowner right to set up a plea of "promissory estoppel" against the State The petitioners contended that state government is barred by the rule of "promissory estoppel" from acquiring the land for which it had issued NOC to them. The bench while rejecting this contention of petitioners observed: "The factum of grant of NOC for establishing the college would not be an impediment for the State Government to acquire the land in accordance with the provisions of the applicable land acquisition act." The bench held that the grant of NOC/ license/ CLU or any other permission would not give the landowner a right to set up a plea of "promissory estoppel" against the State. Use of land for development of industrial infrastructure constitutes "public purpose" under the Land Acquisition Act, 1894 The Land Acquisition Act, 1894 gives power to the state government to acquire land required for "public purposes", upon satisfaction of certain procedural requirements. The petitioners in the present case contended that the development of Industrial Model township i.e. the purpose for which land was acquired, is not a public purpose. Rejecting this contention of the petitioners, the bench observed that the definition of public purpose is not capable of being given a static and definite definition and that the state is the first judge to decide the "public purpose" for which the land is required to be used, though such decision is subject to judicial scrutiny. It held that the land in question is required for development of industrial infrastructure which constitutes "public purpose". The bench also observed that since long time has lapsed from the date of acquisition, even if due to change in the planning, if the land in question is sought to be utilised for any other public purpose, there would no impediment for same in view of the settled proposition of law. The recommendations of the Land Acquisition Collector are not binding on the State Section 5A of the Act, provides hearing of the objections to the proposed acquisition of land by the Collector. The petitioners contended that recommendations made by the Land Acquisition Collector to exempt land from the acquisition proceedings in the objections heard in present case are binding on the State Government. The court rejected this contention of the petitioners and observed: "Recommendations made by the Land Acquisition Collector to exempt land from the acquisition proceedings or even to acquire the land are not binding on the State except that same have to be considered by the State Government while forming the opinion." No case of discrimination under Article 14, Constitution of India made out The bench also rejected the contention of the petitioners that the action of the state government violates Article 14 of the Constitution of India and observed that petitioners have to show that they are identically situated to such persons in whose favour discrimination is being pleaded to prove discrimination on part of the state. Court rejected the argument stating that petitioners have not placed on any material to support its contention of discrimination. The court also laid emphasis on the fact that when on 26.02.2007, it made an order in favour of the petitioners, granting them interim stay on dispossession [status quo order], the petitioners did not bring to the notice of the...

Grant Of NOC For Land Use Does Not Give Immunity To Landowner Against Acquisition, Principle Of Promissory Estoppel Not Attracted: P&H High Court

Paras Ahuja

There is nothing which could impinge upon State's power to acquire licenced property in larger public interest.

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