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NON-REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO……6606…………/2016         (Arising out of S.L.P. (Civil) No. 39898/2012)

The Energy and Resources Institute ….Appellant

Versus

Suhrid Sudarshan Shah & Ors.              …..Respondents

WITH

CIVIL APPEAL NO……6607………/2016 (Arising out of S.L.P.(Civil) No. 4886/2013)

J U D G M E N T

A.M. Khanwilkar, J.

Leave granted.

2. Respondent  No.1  (Suhrid  Sudarshan  Shah)  had  filed  Writ

Petition under Article 226 of the Constitution of India before the

High  Court  of  Uttarakhand  at  Nainital  in  the  nature  of  public

interest litigation against the State of Uttarakhand and the Director

of Horticulture and Food Processing, to question the allotment of

orchards belonging to the State on lease for a period of 25 years to

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private parties without following auction process.  Reliefs claimed in

the said Writ Petition (PIL) No.600 (M/B) of 2003 read thus:

                                PRAYER

i) It is, therefore most respectfully prayed that this Hon’ble Court may graciously be pleased to allow this petition and issue:-

ii) Writ  Rule,  Order  or  direction  in  the  nature  of mandamus commanding and directing the respondents not to implement the decision/policy of the government to  handover  77  government  orchards  to  the  private person.

iii) Writ,  Rule,  Order  or  direction  in  the  nature  of mandamus  declaring  or  rendering  the  government action/policy,  or  handing  over  of  77  government orchards to private persons, void and unconstitutional.

iv) Any other relief, which this Hon’ble Court may deem fit and proper in the circumstances of this case.

v) To award the cost to the petitioners.    

This Writ Petition was summarily dismissed by the Division Bench

of the High Court on 30th August 2003.  The Court noted that the

short  point  to  be  decided  in  the  Writ  Petition  was  whether  74

orchards  or  any  of  them  were  making  profit,  as  alleged.   The

Division Bench opined that the writ petitioner had failed to provide

any details in that regard in the Writ Petition.  On the other hand,

the State furnished a chart based on Profit and Loss Account of the

orchards, which was taken on record.  The factual position stated

therein  having  remained  uncontroverted,  the  Division  Bench

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summarily dismissed the Writ Petition in limine.  

3. The respondent No.1 carried the matter to this Court by way of

S.L.P.(Civil) No. 23707/2003 (converted into C.A. No. 4629/2006).

In that appeal, the State was called upon to file counter affidavit

before this Court, wherein, it was, inter-alia, contended by the State

as follows:

“(1) That  a  total  area  of  1380.254  Hectare  comprised  in  104 Government  orchards have been dismissed,  the estimated value whereof would be about Rs.138 crores.

(2) The State of Uttaranchal has  allegedly taken a purported policy decision in terms whereof  Public Private partnership was sought to be resorted to with a view to attract more investment and provide  new  avenues  of  employment  for  local  people  and  for betterment of the economic condition of the public in general and the Government.

(3) With the private investment coming in these orchards the benefit thereof would also pass to the local people. Moreover, other horticultural  activities  like  medicinal  and  herbal  plants,  tea, sericulture  and  other  high  value  land  based  operations  are proposed to be taken upon these lands/orchards in future.”

With reference to this plea, this Court vide judgment dated August

30, 2006 opined that the matter required consideration afresh by

the High Court.  In that, the High Court in the first place ought to

consider the question as to whether on the admissions made by the

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State,  the  purported  policy  to  lease  out  such valuable  lands  on

nomination basis was in public interest or not, keeping in mind the

exposition  in  the  case  of  Ramana  Dayaram  Shetty vs.

International Airports Authority of India & Ors.1.  The Court

noted that since the nominees were not before the Court, the High

Court should give opportunity to them before finally deciding the

matters in issue.  This Court, accordingly, was pleased to set aside

the High Court order and remanded the Writ Petition to the High

Court for fresh consideration in accordance with law.  

4.  In  furtherance  of  remand  order,  the  Writ  Petition  stood

restored before the High Court and was assigned fresh number as

Writ Petition (PIL) No. 857/2007.  In the said Writ Petition the High

Court ordered impleadment of the nominees.  The appellants before

this Court were accordingly impleaded as respondent Nos. 25 and

26 vide order dated 18th July 2011.  Having received court notice,

respondent No. 25 (appellant in appeal arising from SLP (Civil) No.

3989/2011)  responded  to  the  writ  petition  by  filing  an  affidavit

dated 20th November 2011 and supplementary affidavit dated 29th

July 2012 in the said Writ Petition.  The said appellant asserted on 1  [1979 SCR (3) 1014 = (1979) 3 SCC 489]

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affidavit that allotment of orchard in its favour was just and proper.

It was done on the basis of a well informed policy decision taken by

the State Government and in larger public interest.  Further, the

said appellant being a registered society was established with the

aim  to  tackle  and  deal  with  immense  and  acute  problems  that

mankind is likely to face in the years ahead on account of gradual

depletion of  the  earth’s  finite  energy resources which are largely

non-renewable  and existing method of  their  use.  That  the policy

decision,  contended  the  said  appellant,  was  taken  by  the  State

Government  - as the stated 104 orchards were causing huge losses

to the public exchequer for its management, in particular towards

the payment of salaries to its employees.  The State Government

had suffered staggering loss to the tune of Rs. 2,70,00,000/- in the

year  1998-1999,  Rs.  2,91,00,000/-  in  the  year  1999-2000  and

Rs.2,10,00,000/- in the year 2000-2001.  In this backdrop, with the

approval  of  the  Cabinet  the  State  Government  delineated  the

measures for re-organization of the Horticulture Directorate of the

State  Government  of  Uttarakhand.   In  pursuance  of  the  said

Scheme, the Principal  Secretary-cum-Commissioner circulated an

official  Order  dated  21st May  2001  to  all  Universities,  Research

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Institutes  and  Government  Departments  as  well  as  District

Administrations  expressing  its  desire  to  make  available  on  long

term lease  the  unproductive  77 Government  Udhyaans/orchards

for horticulture and agricultural diversification.  The appellant (in

C.A. arising out of SLP (Civil) No.39898/2012) after becoming aware

of  the  policy  decision  of  the  State  Government,  expressed  its

interest for allotment of Government orchard on long term basis by

submitting  proposal  on  22nd August  2001.   That  proposal  was

processed at different levels including by the Cabinet of the State

Government  in its meeting dated 11th October 2002; and after due

deliberations,  the  Government  through  its  Joint  Secretary,

Horticulture, vide letter dated 16th October 2002, informed the said

appellant that the proposal submitted by it has been accepted.  It is

also contended by the said appellant that news articles were duly

published in the local newspapers including Indian Express about

the  Uttarakhand  Government  having  invited  NGOs  to  conduct

research on the uses of the medicinal plants and herbs available in

the Himalayas.  Further, consequent to the sanction accorded in

favour  of  the  said  appellant,  lease  deed  was  executed  on  5 th

February 2003 through the Director, Horticulture, Government of

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Uttarakhand in respect of 7.50 hectares for 5 years initially subject

to renewal for  another 20 years on satisfactory fulfillment of  the

terms and conditions of the allotment and the lease deed.  That the

appellant thereafter has made huge investment to the tune of Rs.

15 crores in setting up the entire project.  It is stated that the State

Government  had  formed  a  Six  Members  Committee  under  the

Chairmanship of Professor A.N.Purohit for formation of Government

policy for allotment of the remaining 70 unproductive orchards to

private  parties  on  leasehold  basis.   Requisition  notice  was  also

issued inviting private (interested) parties for grant of orchards on

long term leasehold basis.  It is contended that as per the policy the

lessee was obliged to pay lease amount quantified as 100 times of

the Government revenue for the first 10 years and, thereafter, 200

times for the next 15 years.  In the process, no revenue loss has

been caused to the State Government.

5. As regards the appellants in companion Civil Appeal (arising

out  of  SLP  (Civil)  No.  4886/2013)  whose  predecessor   was

impleaded as respondent No.26 in the Writ Petition, the High Court

in  the  impugned  judgment  has  noted  that  neither  any

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representation was made on his behalf nor any response was filed.

As the legal heirs and representatives of the said respondent, who

have  filed  the  present  appeal,  however,  assert  that  neither  any

notice was served on their predecessor nor they were aware about

any proceedings pertaining to the two grants issued by the State

Government in favour of  their  predecessor.   As a matter  of  fact,

their predecessor Akhilesh Kala had expired on 20th August 2010,

much before the order was passed by the High Court on 18 th July

2011 for impleading him as respondent No.26 in the remanded Writ

Petition. In other words, the Writ Petition proceeded against a dead

person; and that too without giving any opportunity to him or to the

persons claiming through him in any manner.  For, no notice about

the  said  proceedings  was ever  served on the  said respondent  or

their successors in title.

6. The  Division  Bench  of  the  High  Court  proceeded  to  finally

dispose  of  the  remanded  Writ  Petition  vide  impugned  judgment

dated 30th July 2012.  The High Court in the first place noted that

before the formation of State of Uttarakhand, stated 104 orchards

were under effective control of State of Uttar Pradesh and were run

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and managed through its Horticulture Department.  After creation

of State of Uttarakhand, the Horticulture Department of the State of

Uttarakhand  evolved  mechanism to  manage  and  maintain  those

orchards for which it invited six persons of the public to take over

seven  orchards.   On  such  invitation,  those  six  private  persons

expressed  their  interest  to  take  those  seven  orchards  on  lease.

Seven leases were executed in favour of six private persons and they

were put in possession of seven orchards on lease basis.  For the

remaining orchards,  advertisement  was published and lease  was

granted in favour of persons who succeeded in response to the said

advertisement.  The High Court then proceeded to observe that the

present  public  interest  litigation  raises  issue  about  the  unjust

allocation  of  orchards,  as  it  has  not  benefitted  the  State

Government.  Thus, the grants must be declared as illegal.  After

having  noticed  this  position,  the  High  Court  in  the  impugned

judgment has noted that grants given pursuant to advertisement

need no interference as no contention has been raised in the Writ

Petition about the correctness or validity of the advertisement and

as the grants were settled pursuant to the said advertisement.  

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7. In other words, the High Court decided to limit the issue in

Writ Petition with regard to allotment and grant of seven orchards

to six private persons, which included the present appellants.  The

Court  noticed  that  out  of  seven  grants,  three  grantees  have

surrendered  their  grants.   Only  three  grantees  namely,  Dabur

Research Foundation, Tata Energy Research Institution (appellant

in appeal arising out of SLP (Civil) No. 39898/2012) and Akhilesh

Kala  (appellant  in  C.A.  arising  out  of  SLP(Civil)  No.  4886/2013)

have  chosen  to  continue  with  the  four  grants.   The  Court  then

proceeded to examine the validity of the grants in favour of these

three private persons.  It  first considered the validity of  grant in

favour of Dabur Research Foundation.  The High Court noted the

contention  of  the  said  grantee  that  lease  was  executed  after

advertisement  was  published.   It,  however,  found  that  the  said

grantee had not stated that the lease in its favour was the subject

matter of any advertisement.  With regard to the second contention

of  the  grantee  that  the  lease  conditions  provide  for  periodical

inspection after every five years, the High Court opined that neither

the State nor the said grantee produced inspection report on record

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to  substantiate  that  inspection has been carried  out,  much less

having  complied  with  the  terms  and  conditions  of  lease  in  all

respects.  The Court further found that as per the lease terms the

grantee was obliged to impart horticulture education to the people

of the locality and also to provide them engagement, but neither the

State nor the said grantee has produced any record that even that

condition has been complied with.  The Court noted that the said

grantee claims to have planted medicinal herbs which has had the

capability of fighting cancer, but found that the said grantee was

exploiting the same for its own benefit to the extent possible.  In

that, no benefit has been derived by the State Government or its

people to any extent except the lease rent of Rs.1250 per Hectare

per year. The Court, accordingly, held that the allotment in favour

of Dabur Research Foundation was surreptitious and has benefitted

only the grantee Dabur Research Foundation.   

8. Having analysed the case of Dabur Research Foundation, the

High Court proceeded to hold that similar situation obtains even in

respect  of  the  appellant  (in  C.A.  arising  out  of  SLP  (Civil)  No.

39898/2012-Tata Energy Research Institute), who has been given

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orchards spread over to the extent of 7.50 Hectares at an yearly

rental  of  Rs. 7245/- only.   No other analysis much less are any

reasons found in the impugned judgment qua the said appellant

Tata  Energy  Research  Institute.  The  sum and  substance  of  the

conclusion  of  the  High  Court,  is  that,  the  State  did  not  take

recourse to due diligence to ascertain as to how the revenue from

the land could be optimized by the State.  On this reasoning, the

High Court proceeded to cancel the grants and the lease granted

even in favour of the appellant (in appeal arising out of SLP (Civil)

No.  4886/2013-Akhilesh  Kala).   The  High  Court  also  issued

direction to the three grantees to hand over physical possession of

the land in question to the State Horticulture Department within a

period of six months from the date of the order.  The Court further

directed that after possession is taken the State should utilize the

orchards and must make an endeavour to ascertain at least what

best  possible  price  it  can  get  for  the  same  before  exploring  the

option of private-public partnership arrangement for exploitation of

the said orchards.

9. This  decision is  the  subject  matter  of  challenge  in  the  two

appeals before us.  Notably, Dabur Research Foundation has not

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chosen  to  challenge  the  decision.   It  is  only  the  legal  heirs  of

Akhilesh Kala (original Respondent No. 26 in Writ Petition) and The

Energy Research Institute (formerly known as Tata Energy Research

Institute)  (original  Respondent No.  25 in Writ  Petition)  who have

questioned the correctness of the view taken by the Division Bench

of the High Court and in particular quashing and setting aside of

the grants and lease deeds executed in their favour by the State.

The  grievance  of  the  Energy  Research Institute  is  that  the  High

Court has completely glossed over the stand taken by it on affidavit

filed to oppose in the Writ Petition.

10. In  the  case  of  Tata  Energy  Research  Institute  elaborate

response was filed on affidavit raising diverse pleas, as referred to

above.  None of the contentions so raised have been dealt with by

the  High  Court.   As  regards  the  heirs  of  Akhilesh  Kala,  it  is

submitted that the High Court could not have proceeded with the

hearing of the Writ Petition against a dead person.  In any case, the

High  Court  should  have  ascertained  the  factual  position  about

service of notice on respondent No.26 as impleaded.  No satisfaction

in that behalf is noted in the impugned judgment. It is cardinal that

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in absence of service on the named respondent, the Court should be

loathe to proceed with the matter finally against such respondent;

and more so in the backdrop of the dictum of the Supreme Court

whilst  remanding the  Writ  Petition that  the  nominees should  be

heard  who  were  not  made  parties  in  the  Writ  Petition,  as  was

originally filed.

11. Having  considered  the  rival  submissions,  we  desist  from

examining the controversy about the merit of the allotment to the

respective  appellants.   For,  we  are  inclined  to  relegate  the

appellants and respondent No.1 as also the State Authorities in the

respective appeal for reconsideration of the matter afresh qua these

appellants.   

12. This Court, on the earlier occasion, had plainly observed that

the  High  Court  in  the  first  place  must  examine  the  question

whether the stand taken by the State Government that the stated

policy  to  lease  out  orchards  to  the  private  persons  (including

appellants herein) on nomination on long term basis was in public

interest or  not;  and to do so after giving due opportunity to the

nominees (such as the appellants before us) by impleading them as

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party respondents in the Writ Petition. Admittedly, the appellants

were  directed  to  be  impleaded  as  respondents  25  and  26

respectively, in the remanded Writ Petition.  

13. In the  impugned judgment,  however,  there is  absolutely  no

discussion  on  the  question  whether  the  policy  of  the  State

Government,   which was  the  subject  matter  of  challenge  in  the

remanded Writ Petition, was in accordance with law and in public

interest  or  not.   If  it  were  to  be  found  that  such  a  policy  is

permissible  in  law;  and  that  the  allotment  to  the  respective

respondents 25 and 26 in the said remanded Writ Petition was in

conformity with that policy, the end result would be quite different.

Further,  the  High  Court  has  in  any  case  failed  to  analyze  the

diverse  pleas  available  to  the  appellants  herein  and  more  so

specifically taken by the appellant (in C.A. arising out of SLP (Civil)

No. 39898/2012) on affidavits whilst opposing the remanded Writ

Petition on the factual matrix including about the engagement of

the said appellant in activities which are beneficial to the locals and

in larger public interest.  According to the said appellant, they have

not only complied with all the stipulations required to be fulfilled in

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terms  of  the  State  Government  policy  but  were  scrupulously

adhering to all the terms and conditions of lease executed in their

favour  without  any  exception.  Moreover,  even  the  periodical

inspection of  orchards  managed  by  the  said  appellant  has  been

done  by  the  competent  authority,  unlike  in  the  case  of  Dabur

Research Foundation.    

14. We  are  in  agreement  with  the  appellants  that  without

analyzing  the  contentions  specifically  raised  by  them,  it  was

improper to make a sweeping observation against these appellants

with reference to the case of Dabur Research Foundation.    

15. Indubitably,  no  discussion  about  the  stand  taken  by  the

respondent  No.  25  on  affidavits  can  be  discerned  from  the

impugned judgment. In other words, the decision of the Division

Bench qua the respondent No.25 in the remanded Writ Petition is

sans  any  reason,  if  not  cryptic.  That  cannot  stand  the  test  of

judicial scrutiny especially when the decision results in serious civil

consequences  to  the  party;  and  more  so  when this  Court  while

remanding the matter had made it clear to hear all the nominees

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likely  to  be  affected  by  the  decision  and  to  answer  all  relevant

issues including the justness of the Government Policy.

16. Reverting to the case of appellant (in C.A. arising out of SLP

(Civil) No.4886/2013) their predecessor in title had already expired

on 20th October 2010.  If so, the High Court could not have directed

impleadment of a dead person as respondent No.26.  Further, there

is  nothing  in  the  impugned  judgment  to  indicate  that  the  High

Court  before  proceeding  to  finally  dispose  of  the  Writ  Petition,

reassured itself that respondent No.26 has been duly served.  All

that  is  mentioned  in  paragraph 4,  in  the  last  sentence,  is  that,

Akhilesh Kala, despite notice, has not responded. However, on the

factum as to when such service was effected or whether the service

was  complete  in  all  respects,  no  observation  is  found  in  the

impugned judgment.  The appellants in the said appeal, however,

asserted that no notice was received at the known residence of their

predecessor.  The fact remains that the respondent No.26 could not

be represented, being a dead person.  The concomitant is that, the

Writ Petition proceeded for final hearing without hearing the said

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respondent. This was against the spirit of the remand order passed

by this Court.

17. Considering the above, we deem it appropriate to quash and

set aside the impugned judgment and order only qua appellants

herein (the respondents 25 and 26 in the Writ Petition); and further

direct  remand  of  the  Writ  Petition  to  the  High  Court  for

reconsidering  it  afresh  only  with  regard  to  them as  regards  the

validity of grants in favour of Tata Energy Research Institute  (now

known as Energy and Resources Institute); and two grants in favour

of Akhilesh Kala as the appellants herein claim to be the heirs and

legal representatives of deceased Akhilesh Kala.

18. We once again make it clear that we may not be understood to

have disturbed the order in any manner operating against Dabur

Research Foundation (original respondent No.14, in the remanded

Writ Petition).

19.  Considering the fact that the Writ Petition has been filed in the

year 2003 and is required to be remanded for the second time by

this  Court  and  in  view  of  the  nature  of  issue  involved  and  the

substantial  period  of  lease  term  is  already  exhausted,  the  High

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Court  is  requested  to  dispose  of  the  remanded  Writ  Petition

expeditiously, preferably within six months.  The High Court may

consider the request of the concerned parties to file affidavits and

further  pleadings  as  may  be  necessary.   All  questions  in  the

remanded writ petition in terms of this order, are left open.

20. The appeals are allowed in the above terms with no order as to

costs.

..………………………….CJI (T.S.Thakur)

..……………………………J. (A.M. Khanwilkar)

……………………………..J. (D.Y. Chandrachud)

New Delhi, Dated: 22nd July, 2016