A landmark Supreme Court judgement has given huge relief to farmers/landowners, while quashing the “illegal” and “deceptive” licensing of 280 acres of land in Rohtak, Haryana in 2006 to Uddar Gaggan Properties Ltd.
This serves as a body blow to former Haryana Chief Minister Bhupinder Singh Hooda and other state officials who are facing multiple probes for facilitating the private enrichment of builders through similar illegal licencing.
“The unholy nexus to promote the private interests” of builders by “transfer of resources of poor for the benefit of the rich”, through “gross abuse of law” and “clear fraud” referred to in the judgement, has been detailed in a series of media exposes, beginning October 8, 2012, first about the irregularities in property dealings involving real estate major DLF and Congress President Sonia Gandhi’s son Robert Vadra, while later going on to uncover Hooda’s modus operandi to favor a host of other builders, including Uddar Gaggan.
Hooda’s modus operandi
This earlier expose had revealed that Hooda was acquiring land from poor, illiterate farmers at a low rate in the name of ‘public interest’ only to later license this to builders after bestowing out-of-turn favors that helped the land value increase exponentially.
The facts disclosed therein, had pointed to Hooda’s motivation in licensing a staggering 24,825 acres of land during his 10-year tenure as Chief Minister, as against just 8,550.32 acres by successive Chief Ministers in the 23 years preceding Mr. Hooda’s rise to power in 2004.
Under the Land Acquisition Act 1894, the Haryana Urban Development Authority (HUDA) and Haryana State Industrial Development Corporation (HSIDC) have powers to acquire land under Section 4 & 6 through the issuance of notifications, while the award of licence is announced under Section 9.
Builders who are unable to coerce farmers to sell their land turn to the government for official assistance. On cue, using Section 4, the State intimates landowners that the government requires those specific parcels of land for ‘public purpose’. At this stage, builders enter into agreements to sell/collaborate with landowners/farmers, offering them a modest premium over the government’s prevailing compensation rate.
If landowners/farmers offer resistance, Section 6 is imposed, declaring the State’s intention to acquire land. This forces even resistant landowners to enter into agreements. Between the imposition of Sections 4, 6 & 9, and even after award, as in this case, builders apply for licences in collaboration with farmers/landowners to the Town and Country Planning (TCP), Haryana. Once the land is released from acquisition, its value — for those chosen builders — soars dramatically.
The Uddar Gaggan case
Reflecting the larger modus operandi, in this particular case, too, HUDA first staked its claim to acquire 850.88 acres of land in Sector 27-28, Rohtak vide a notification of April 11, 2002, for residential/commercial purpose. However, the final notification of April 8, 2003 under Section 6 of the land Acquisition Act was in respect of 441.11 acres.
On March 21, 2005, Uddar Gaggan submitted its applications to TCP, Haryana for licenses to develop a colony across 280 acres.
The award of land for 422.44 acres took place on April 6, 2005 and Uddar Gaggan’s licences were granted on June 12, 2006 after releasing the apportioned land, “free from all encumbrances”, from acquisition in the guise of “public purpose”. The licences were addressed to the landowners but remitted to the builder and followed by execution of sale deeds in favor of the builder by using power of attorney of landowners.
“Power of land acquisition vested under the 1894 Act could be invoked only in public interest and not for creating a land bank in favor of Uddar Gaggan through distress sales. The State cannot force the landowners to surrender their title in favor of and at a price to be dictated by a private beneficiary,” the judgement reads, while adding that “the notified public purpose was only a ruse to enable Uddar Gaggan to purchase the land at the lowest possible price for maximizing the profiteering”.
The SC judgement takes cognizance of the fact that “the builder did not own an inch of land, yet every licence was addressed to it and sent with a specific enclosure that Uddar Gaggan was the sole owner of the licensed and released land. The issuance of license, in our considered view, was a fraud played on the policy behind the 1975 Act”.
“Here is a case where artificial reasons were created, the records were fudged with the aid of the Deputy Commissioner, Rohtak, to mislead the fact that the possession of acquired land was not taken while announcing the Award. The responsible officers of the State Government, in their anxiety to help out Uddar Gaggan, have completely overlooked the interest of landowners or of the General Public to whom thousands of plots could have been allotted at a fairly low price through the aegis of HUDA”.
This “amounts to transfer of resources of poor for the benefit of the rich. It amounts to permitting profiteering at the cost of livelihood and existence of a farmer. This is against the philosophy of the Constitution and in violation of guaranteed fundamental rights of equality and right to property and to life. What cannot be done directly cannot be done indirectly also”.
SC strikes a body blow to corrupt builders
“Undoing of such illegal actions would clearly be in the interests of justice. The wrong has to be remedied”.
Therefore, now, by virtue of this judgement, “all licences granted in respect of the land covered by acquisition stand transferred to HUDA”, “free from all encumbrances”, while “all release orders” and “sale deeds/other agreements in favor of the builder” as well as “creation of any third party rights by the builder”, stand quashed.
The SC has additionally ordered that the sale consideration paid by Uddar Gaggan to the land owners be treated as compensation. This means land owners will not be required to refund any amount, while those who did not receive any compensation, will now do so. “Land owners will also be at liberty to prefer reference under Section 18 of the 1894 Act within a period of three months, if such reference has not been earlier preferred”.
The builder will “be entitled to refund/reimburse any payments made to the State, land owners or on development of the land, from HUDA on being satisfied about the extent of actual expenditure not exceeding HUDA norms on the subject”. The “claim of the builder will only be taken up after settling claim of third parties from whom the builder has collected money. No interest will be payable on the said amount”.
“The third parties from whom money has been collected by the builder, upon verification of their claims, will be entitled to either the refund of the amount, (out of and to the extent of the amount payable to the builder under the above direction, available with the State), or will be allotted plots at the price paid or price prevalent, whichever is higher. No interest will be payable on the said amount”.
The State has also been directed to give the “benefit of “Rehabilitation and Resettlement of Land Acquisition Oustees” policy of the State/HUDA to land owners, by reserving the required area from the acquired land itself”.
While allowing a year for compliance of its judgement, the SC had laid down a strict schedule: a quarterly progress report of the action taken to be filed by the State in this Court and “final report of compliance to be filed within one month after expiry of one year from today for such further direction as may become necessary”.
Hooda and his men in the dock
The SC has further directed the State government to “enquire into the legality and bona fides of the action of the persons responsible for illegally entertaining the applications of the builder and releasing the land to it, when it had no title to the land on the date of the notification under Section 4 of the 1894 Act” and to “proceed against them in accordance with law”.
According to government records, available with The Firstpost, roughly 244 acres has been released for grant of CLU/Licence after Section 4, around 2,471acres released after Section 6 and 930 acres of land released after award under Land Acquisition Act, 1894. This takes the total land licensed in this manner between 2004 to 2015 to a staggering 3,646 acres (See chart).
This “fraudulent and clandestine exercise of power by the State is not permitted by law”. The fact that the award of this 3,645.6655 acres is also “in violation of Public Trust Doctrine”, means big trouble for Hooda, his accomplices and other beneficiaries.
Hooda is already under probe by the Justice SN Dhingra Commission for his role in the illegal grants of licences to hundreds of private companies, including the Robert Vadra case, involving his company Skylight Hospitality and DLF.
A CBI enquiry into 14 other plots allotted in violation of due process by Hooda is already ongoing on the reference of the state government.
Earlier this month, the Haryana state government filed a First Information Report (FIR) for the illegal allotment of prime land in Panchkula, estimated to be worth roughly Rs 100 crore, to the Associated Journals Ltd (AJL). AJL is the parent company of National Herald, the now defunct mouthpiece of the Congress Party.
The move followed a Firstpost exposé of 29 December 2015 detailing the file movement that showed how former chief minister Bhupinder Singh Hooda overturned legal and official advice from within his government to first illegally re-allott the plot, then condone delays and defaults, even going so far as to extend additional unwarranted and unprecedented favors, including “camouflage aid to the firm”.
Hooda has been daring the government to initiate inquiries to establish allegations of wrongdoing. Now that these inquiries are on full swing, both he and the Congress party have started accusing the BJP governments at the centre and in Haryana of pursuing “vendetta” politics.