High Court Kerala High Court

Sud Chemie India (P) Ltd vs State Of Kerala on 26 May, 2010

Kerala High Court
Sud Chemie India (P) Ltd vs State Of Kerala on 26 May, 2010
       

  

  

 
 
  IN THE HIGH COURT OF KERALA AT ERNAKULAM

WP(C).No. 32544 of 2006(Y)


1. SUD CHEMIE INDIA (P) LTD.,
                      ...  Petitioner

                        Vs



1. STATE OF KERALA, REPRESENTED BY
                       ...       Respondent

2. THE PRINCIPAL SECRETARY REVENUE (A)

3. THE DIRECTOR OF INDUSTRIES,

4. THE GENERAL MANAGER,

5. THE DISTRICT COLLECTOR,

                For Petitioner  :SRI.BECHU KURIAN THOMAS

                For Respondent  :ADDL.ADVOCATE GENERAL

The Hon'ble MR. Justice S.SIRI JAGAN

 Dated :26/05/2010

 O R D E R
                       S. SIRI JAGAN, J.
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                  W.P.(C)No. 32544 of 2006
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            Dated this the 26th day of May, 2010

                         J U D G M E N T

In late 1960’s the petitioner company, when that

company was known as United Catalysts and Chemicals

India Ltd., came to Kerala and requested for assignment of

50 acres of land to establish an industry. The Government

was not able to find 50 acres for assignment to the

petitioner. However 21.52 acres were assigned.

Consequently the company had to modify its project to suit

the land available and accordingly an industry was started.

At that time their annual turnover was only Rs.10 – 15

crores. Over the years the turnover increased and at the

time of filing this writ petition it had increased

phenomenally to Rs.160 crores. At the time of assignment,

the entire market value of the land was paid by the

petitioner to the Government. Patta was issued in favour of

the petitioner, which is produced as Ext.P3. Ext.P1 is the

W.P.(C)No. 32544 of 2006
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rules for assignment and Ext.P2 is the order giving

assignment. But strangely by Ext.P5 dated 14.2.2001 the

petitioner was directed to show cause why an area of 5.29

acres out of 21.52 acres should not be resumed, since the

petitioner had not utilized the land for the purpose for

which the same was assigned in favour of the petitioner.

Petitioner filed a very detailed reply which is produced as

Ext.P6, wherein they have graphically detailed how the said

property is utilized and their future plans for expansion.

The matter came up for hearing before the 1st respondent.

The petitioner filed Ext.P7 further written statement again

detailing their plans regarding utilization of that land. But

rejecting all those contentions, by Ext.P8 order dated

29.5.2008, the Government has confirmed the proposal to

resume the 5.21.900 acres out of the 21.52 acres assigned

to the petitioner. The petitioner is challenging that order.

Petitioner contends that the Government has no power to

resume the land except as provided in Ext.P1 rules and

Ext.P3 patta issued to the petitioner. According to the

W.P.(C)No. 32544 of 2006
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petitioner, Ext.P1 rules and Ext.P3 patta do not authorize

the Government to resume a portion of the land assigned on

the ground that, that particular portion of land has not been

utilized for the purpose for which the land was assigned to

them. According to the petitioner, even otherwise there

was absolutely no reason whatsoever for resuming the land.

The counsel for the petitioner would point out that, on

assignment of certain land an industry cannot utilize every

inch of the land assigned to them. It is not as if when

assignment is made an assignee is expected to construct

buildings covering the entire land so assigned without

leaving any open space whatsoever. He would contend

that, open space is also a very necessary requirement of an

industry. In fact the pollution control laws specifically

prescribe maintenance of a green belt in every industry

particularly chemical industry which the petitioner is, which

can only be in an open space. Even apart from that, in

every industry, there should be open space for other

purposes as well like space for recreation facilities of the

W.P.(C)No. 32544 of 2006
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employees, for well, future expansion etc. The counsel for

the petitioner would point out that it is not as if a big block

of land is remaining vacant which can be taken over by the

Government for allotment to others. He points out that as

directed by this court, the 4th respondent has placed a

report before this court along with a sketch of the entire

area assigned to the petitioner, which would go to show that

the area proposed to be resumed is interspersed with

buildings and therefore it is impossible for the Government

to resume the bits and pieces of land in between of those

buildings so that it can be assigned to somebody else. He

submits that a mere glance at the sketch produced by the

4th respondent would show that it is well nigh impossible for

anybody to use the land proposed to be resumed by the

Government.

2. A very long counter affidavit has been filed by the

4th respondent who supports the impugned order on the

ground that the rules do permit the Government to resume

the land remaining unutilized by an assignee. A reply

W.P.(C)No. 32544 of 2006
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affidavit has also been filed by the petitioner controverting

contentions in the writ petition wherein again they have

detailed their future plans for expansion as well as the

utilization of the balance land. They would submit in the

reply affidavit that as early as in 2003 itself construction of

rain water harvesting facility, biomass boiler, biomass

storage, warehouse and also by product storage facility in

the area sought to be resumed. They further submit that

the total turnover of the petitioner for the financial year

2007-08 was Rs.231 crores, that for 2008-09 had been 339

crores, while that for the year 2009-2010 was Rs.358

crores. Therefore according to them, for an ever expanding

industry space is required for future expansion as well.

3. I have considered the rival contentions in detail.

At the outset I must note that on a perusal of the sketch

produced by the 4th respondent himself, of the entire area

assigned to the petitioner, including the area sought to be

resumed, I find that seven buildings are interspersed in the

area sought to be resumed. A mere glance at the sketch

W.P.(C)No. 32544 of 2006
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would convince any person that, it is impossible to resume

the land proposed to be resumed which lie in bits and

pieces among the buildings, unless the petitioner is evicted

from the utilized portions as well.

4. I further note that Ext.P8 order is totally a non-

speaking order consisting of hardly one page which does

not even make a show of considering any of the contentions

of the petitioner in Exts.P6 & P7. No reason whatsoever is

mentioned in Ext.P8 for deciding to resume the land. In

fact, Ext.P8 order is liable to be quashed on ground of being

violative of principles of natural justice.

5. Even apart from that, I am surprised that a

Government which speaks of promoting industries in Kerala

in every public platform and invites persons from outside to

invest money in the State for industries, takes such an

attitude towards an already existing company which gives

employment to many people in the State. It is not as if once

the land is assigned to an industry, every inch of that land

should be occupied by buildings, failing which, the

W.P.(C)No. 32544 of 2006
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Government can resume the land. It is impossible for any

industry whatsoever to use every inch of land in their

possession for constructing buildings for the industry.

Naturally in every industry sufficient open space is a must,

especially in view of the ever increasing pollution in the

State. As rightly pointed out by the learned counsel for the

petitioner, as per the pollution control laws every industry

particularly, a chemical industry is bound to maintain a

green belt. Nobody can dispute that the green belt can only

be an open space and not in an area covered by buildings.

In Ext.P6, the petitioner has stated thus regarding their

plans for the vacant land.

” As already submitted in our various letter and
communications, it may kindly be noted that the land is kept for
ancillary purposes and for future expansion and for installing
pollution control facilities. At any rate buildings cannot be
constructed in the entire land. The company had submitted
various proposals regarding the utilization of land. Some land
had already been utilized for adding various facilities for
effluent treatment, for recovery of Sodium Sulphate, etc. There
is also proposal for constructing new administrative block as
well as facilities for vehicle parking, etc. at appropriate period.
Central Excise Authorities have accorded permission for
constructing godown for the storage of non-duty paid goods.

As advised by the environmental experts and authorities of the
Pollution Control Board and Directorate of Factories, we have
developed a portion of the land to create a green belt, which is
very much essential experts in the present environmental

W.P.(C)No. 32544 of 2006
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standards, especially for chemical factories. It may also be
noted that out of the 21.52 acres land more than one acre of
land was taken for roads and lost by erosion on the riverside.
Without considering these facts and circumstances the present
Show Cause is issued. Any attempt to resume the alleged
vacant land allotted will scuttle all further developments and
expansion of the industrial unit, which is a very hi-tech industry
and such an attempt would lead to stagnation and ultimate
closure of the industry. We would also reiterate that no
industry can survive if sufficient land is not made available for
them for expansion, diversification, etc. Adequate measures are
already taken for creating ancillary facilities on the land.
Therefore allegation of non-utilization of land is kept unutilized
is incorrect and made without any basis. As already elaborated
the little land is utilized for expansion of ancillary purposes,
creation of green belt, providing pollution control facilities , as
well as the proposed construction of godown, administrative
blocks, etc. There is absolutely no surplus land available with
us.”

These contentions have not even been attempted to be

considered in the impugned order.

6. They have further stated in their reply affidavit

that they have already started construction in 2006 itself for

establishing rainwater harvesting facility, biomass boiler,

biomass storage, warehouse and also by-product storage

facility in the area sought to be resumed. In the additional

reply affidavit other plans are also graphically detailed.

7. Rules 10 to 16 are the relevant rules applicable in

respect of resumption of land which reads as follows:

W.P.(C)No. 32544 of 2006
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10. The land shall be used only for the purpose for
which it is assigned and for no other purpose.

11. Land assigned under these Rules shall be heritable
but it shall not be alienate or encumbered in any manner
without the prior permission in writing of the Government.

12. The Industrialist shall pay all tax, cess, land
revenue and other dues which may be payable in respect of land
from time to time.

13. The Industrialist shall start the industry for the
purpose of which the land is assigned to him, within the period
specified in the order of Government assigning the land.

14. The Government shall have power to resume the
land if the Industrialist contravenes any of the provisions of
these rules or/of the Order of the Government assigning the
land or of the agreement, if any, executed by the Industrialist
with the Government or in the event of the Company or concern
belonging to the Industrialist is wound up or if the Industrialist
is an individual or a group of individuals, if the individual or
individuals are dead.

15. In the event of the Industrialist not requiring the
land for the purpose for which it is assigned, he shall intimate
the Government in writing immediately and thereupon
Government may either resume the land or inform the
Industrialist that he may dispose of the land in any manner he
likes. In case of resumption of the land under this rule, the
Industrialist shall be paid the compensation in the manner fixed
under rule 16.

16. In case the land is resumed by the Government
under rule 14 or rule 15, the Government may take possession
of the land with the buildings and improvements, if any, thereon
and pay the Industrialist the amount paid by him as value of the
land under the rules, or the estimated market value of the land
at the time of resumption, as may be fixed by the District
Collector, whichever shall be less and, if there are any buildings
or improvements of any kind on the land, their value as fixed by
the Collector. Provided that, instead of paying the value of the
buildings and improvements, it shall be open to Government to
direct the Industrialist to remove all or any of the buildings and
other improvements within such time as may be specified, at
the cost of the Industrialist and the Industrialist shall remove
them within the specified period and if he fails to do so

W.P.(C)No. 32544 of 2006
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Government may remove the same at the cost of the
Industrialist and dispose of the materials by public auction, the
proceeds of such disposal being payable to the Industrialist
after recovering therefrom all amounts due to the Government
from the Industrialist.

I am of opinion that these rules do not postulate that

every inch of land assigned in favour of a person under the

rules should be occupied by buildings, failing which, the

Government is entitled to resume the land. That is not the

spirit of the rules at all. Naturally every growing industry

would require land for expansion. Expansion cannot be in

the beginning itself. It can only be in the course of time as

the business of the industry expands. Therefore naturally

for that purpose also the industry would require land. If

Government takes a stand that the entire land assigned

should be utilized all at once then the industry cannot

progress at all. It will always have to stand still, especially

in view of the fact that out of the 50 acres originally

required by the petitioner, the Government was able to

assign only 25.52 acres. Practically the conditions in Ext.P3

patta are a re-production of the above said rules which also

W.P.(C)No. 32544 of 2006
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do not contain any provision to the contrary. For all the

above reasons, I do not find any justification for resumption

of the land as done by the Government in Ext.P8 order.

Accordingly Ext.P8 order is quashed. The writ petition is

allowed as above.

S. SIRI JAGAN
JUDGE

shg/