IN THE HIGH COURT OF KERALA AT ERNAKULAM
WA.No. 985 of 2008()
1. M/S.B'CANTI GROUP OF HOTELS & RESORTS(P)
... Petitioner
Vs
1. A.B.HUSSIAN MANIKFAN,"REMEDU GANDUVAR"
... Respondent
2. THE UNION OF INDIA, REPRESENTED BY THE
3. UNION TERRITORY OF LAKSHADWEEP
4. THE DIRECTOR OF TOURISM
5. SOCIETY FOR PROMOTION OF NATURE TOURISM
6. PYKALA SOCIETY REP. BY ITS DIRECTOR
7. M/S. V.J.M. RESORTS (P) LTD ,5TH FLOOR
8. SRI VIJAY MALLYA, MEMEBR OF PARLIAMENT
For Petitioner :SRI.K.P.DANDAPANI (SR.)
For Respondent :SRI.P.K.IBRAHIM
The Hon'ble MR. Justice P.R.RAMAN
The Hon'ble MR. Justice T.R.RAMACHANDRAN NAIR
Dated :14/11/2008
O R D E R
T.R. Ramachandran Nair, JJ.
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W.A.Nos.985, 1117 and 1215 of 2008
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Dated this the 14th day of November, 2008.
JUDGMENT
Ramachandran Nair, J.
These three appeals arise from the judgment in W.P.(C)
No.2800/2006. Writ Appeal No.1117/2008 is filed by the petitioner in the
writ petition. The 5th respondent in the writ petition (5th respondent in
W.A.No.1117/2008) is the appellant in Writ Appeal No.1215/2008 and the
7th respondent in the writ petition who is the 7th respondent in Writ Appeal
No.1117/2008, is the appellant in Writ Appeal No.985/2008. Since the
appeals arise from the same judgment, we are disposing them by this
common judgment.
2. The subject matter of the writ petition concerns the challenge
against the provisional permission granted by the second respondent, viz.
the Administrator, Union Territory of Lakshadweep for establishing beach
resorts in two uninhabited islands, viz. Thinnakkara and Bangaram, as per
Exts.P16, P17 and P17(a) orders. As per Exts.P16 and P17(a), provisional
permission was granted to the 5th respondent to establish and operate a 38
bedded beach resort at Bangaram and as per Ext.P17 similar permission
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was granted to the 5th respondent herein to establish and operate a 72
bedded resort in Thinnakkara island. In Bangaram island, the provisional
permission granted is for having a joint venture with the 7th respondent
herein by the 5th respondent and in Thinnakkara it is for a joint venture with
the 6th respondent herein.
3. The grounds of challenge made by the writ petitioner to these
orders are the same. The learned Single Judge as per the impugned
judgment, quashed Exts.P16 and P17(a), i.e. in respect of the grant of
permission for establishing 38 bedded beach resort at Bangaram and upheld
the permission granted by way of Ext.P17 in respect of Thinnakkara island.
In Writ Appeal No.1117/2008 the appellant/writ petitioner is challenging
that part of the judgment of the learned Single Judge whereby his challenge
against Ext.P17 order in relation to the opening of resort at Thinnakkara
was repelled. In the other two writ appeals, respondents 5 and 7 are
challenging the judgment whereby Exts.P16 and P17(a) have been quashed.
The parties herein are referred to as arrayed in the writ petition.
4. We took Writ Appeal No.1117/2008 as the leading case and
arguments were heard accordingly.
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5. We have heard Shri P.B. Krishnan, learned counsel for the
appellant, Shri P.R. Ramachandra Menon, learned Standing Counsel
appearing for respondents 2 to 4, Shri P.K. Ibrahim learned counsel for
respondent No.5, Shri A.M.Shaffique learned Senior counsel who appeared
for the 6th respondent and learned Senior counsel Shri K.P. Dandapani and
Shri Millu Dandapani, appearing for the 7th respondent.
6. The learned Single Judge, while quashing Exts.P16 and P17(a),
was of the view that such provisional permission was not preceded by any
sanction issued by the Government of India as far as the resort at Bangaram
is concerned. The 5th respondent society did not produce any document to
show that it was in possession of any land at Bangaram to establish any
tourist resort. It was further held that it would have been highly desirable, if
utmost transparency had been maintained in the matters under challenge,
especially since the potential for tourism industry in the Island of
Lakshadweep is phenomenally high and unimaginable. It was also held that
permission granted in respect of resort at Bangaram Island is without
inviting any tender or quotation and the contention that such procedure was
not necessary, was held wholly untenable. Thus, primarily the learned
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Single Judge was of the view that there was absence of any policy as such in
granting the provisional permission.
7. Lakshadweep is a Union Territory and it is the tiniest member in
the fraternity of 28 States and 7 Union Territories of the landmass of India.
Lakshadweep consists of 36 islands of which 10 are inhabited. The land
area is 32 sq. kms. and the lagoon area is 4200 sq. kms. According to the
2001 census the total population is 60595. Lakshadweep with its snow
white coral sands, corals, rare marine species, friendly people and immense
potential for water sports is one of the best locations in the world for
promoting echo-friendly beach tourism. The Union Territory is administered
by an Administrator.
8. The writ petitioner is a permanent resident of the Island called
Minicoy. The challenge against Ext.P16, P17 and P17(a) orders are based
on various legal and factual aspects. It was mainly contended that the grant
of provisional permission without calling for competitive bids or tenders, is
arbitrary and the State largess cannot be bartered away depending on the
whims and fancies of the officials. Being an entrepreneur in the field, the
petitioner had a legal right to have his application considered by the
authorities and the exclusion of all others while preferring the 5th respondent
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along with respondents 6 and 7, is clearly violative of Article 14 of the
Constitution of India. The orders in question do not confer any benefit on
the Government. The Government had been taking land on lease from
owners. The proclaimed policy as regards development of tourism in
Lakshadweep islands is by inviting competitive bids by global tenders
which was being put in force from the year 1988 onwards. The existing
tourist resort in Bangaram, which was allowed to be established only after
competitive bids were invited, is pointed out as a specific case. It is
contended that the Government of India has not been involved in any of the
decisions rendered by the Administrator along with the Director of Tourism
in Lakshadweep. In the light of the strategic importance of Lakshadweep
Islands and for reasons of its security and in the light of the established
procedure which was being adopted by the Government of India for more
than one decade, it is submitted that the present approach made by the
authorities of the Union Territory cannot be accepted legally. It is also
submitted that the orders are hit by the provisions of Laccadive, Minicoy
and Amini Islands (Protection of ST) Rules, 1967 and the provisions of
Laccadive, Minicoy and Amindivi Islands Land Revenue and Tenancy
Regulation, 1965. There is a clear prohibition for lease of land in the islands
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to outsiders and to other agencies. The 5th respondent Society, it is
contended, is only one formed by a group of people, with the aims and
objectives of promoting beach resorts in the islands. The identity and the
details of the persons behind the society have not been disclosed in spite of
various allegations raised by the petitioner in the writ petition and the
authorities have clearly acted in tune with the wishes and demands made by
respondents 5 to 7. It is thus pointed out that the orders suffer from
malafides.
9. These arguments were countered by the learned counsel for the
respondents. It is pointed out that as argued by the learned counsel for the
petitioner, there had not been any uniform policy evolved by the
Government of India to lease out land for entrepreneurs to establish beach
resorts in the uninhabited islands in Lakshadweep. Lakshadweep
administration was free to take its own decision and it has got unfettered
discretion in the matter. It is contended that the 5th respondent society had
taken on lease land owned by the inhabitants of the two islands and that the
transaction is not hit by any of the provisions of the regulations. The writ
petitioner is a person who is not having any land to establish such resorts
and therefore he is not having any locus standi to challenge Exts.P16 to
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P17(a). It is contended that various authorities have granted permission to
the 5th respondent society to enter into the joint ventures and the statutory
clearances have been obtained before venturing into the business in
question. It is therefore submitted that the learned Single Judge was not
correct in interfering with Exts.P16 and P17(a) orders in regard to
Bangaram Island and the findings rendered regarding the said issue calls for
interference.
10. We will now refer to the scope of the orders impugned in the writ
petition, viz. Exts.P16 to P17(a). As per Ext.P17(a), the Director,
Department of Information, Publicity and Tourism, Lakshadweep
Administration conveyed the approval of the competent authority according
provisional permission for establishment and operation of 38 bedded beach
resort (named as B’Cantil Beach Resort) at Bangaram Island in a joint
venture between M/s. Pykala Society, Agatti and M/s. B’Cantil Groups of
Hotels & Resorts Pvt. Ltd., Trivandrum, Keerala, subject to various
conditions. Ext.P16 is the subsequent order passed him granting permission
to the Pykala Society to bring tourists both domestic tourists and
international tourists to Bangaram island. Ext.P17 is a similar order for
establishment and operation of 72 bedded beach resort at Thinnakkara
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island as a joint venture between M/s. Pykala Society and M/s. V.J.M.
Resorts Pvt. Ltd., Nariman Point, Mumbai, subject to various conditions.
Pykala Society is the 5th respondent herein, M/s. V.J.M. Resorts is the 6th
respondent and M/s. B’Canti Group of Hotels & Resorts (P) Ltd. is the 7th
respondent herein.
11. Firstly, we will consider the dispute regarding the policy
formulation. Learned counsel for the writ petitioner contended that as far as
the policy of the Government of India is concerned, from 1988 onwards the
permissions were being granted only after inviting global tenders and
therefore various parties including the petitioner could compete for the
same. In 1988 international competitive tenders were invited for the lease
of a 12 bed hotel resort in the uninhabited Bangaram island. The successful
tenderer was given lease in respect of the resort for five years which is being
renewed from time to time. It is also pointed out that even while individual
proposals were being mooted by the petitioner, the Administration was duly
informing that as and when further action is taken, that will be informed.
Ext.P1 is one of the replies given by the second respondent to the petitioner,
in that regard. Later, by Ext.P2 another reply was given when he submitted
proposal for setting up resorts in four islands. Ext.P4 will show that the
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Lakshadweep Administration proposed to open up some uninhabited islands
for tourism by leasing their lands to private entrepreneurs by inviting global
tenders, and it was accepted by the Ministry of Tourism, Government of
India. In 1992 global tenders were invited for operation of tourist resorts in
the islands of Thinnakara and Cheriyam. The petitioner submitted his
tender for establishing a resort at Thinnakara and submitted project report
along with a demand draft for Rs.25,000/- as required by the tender
conditions. Ext.P7 is the form for international competitive offer submitted
by the petitioner. Certain clarifications were sought from him by Ext.P8.
But the matter was kept pending without taking any final decision and none
of the tenders were accepted at that time.
12. Relying upon various documents produced by the petitioner,
learned counsel submitted that the policy at that time was that the
Government will invite tenders or quotations, they will lease out the land
on terms and only by such competitive tenders alone, the right to conduct
the resort will be given. Reference is made to Exts.P9 and P10
communications received by the petitioner in that regard. It is also
submitted that in 1996 global tenders were invited for operating 20 bed
resort at Agatti. During the IXth Five Year Plan between 1997-98 to 2001-
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02 the Lakshadweep Administration itself submitted proposals for such
projects to the Planning Commission, Union of India to continue the
existing policy; i.e., the Government itself taking the land on lease from
the land owners and letting it out for tourism development. Specific
reference is made to Thinnakara along with Suheli and Cheriyam. Ext.P21
is relied upon for this purpose. It is also stated that the resort was
established in Bengaram Island in 1988 pursuant to international
competitive tenders invited and when the renewal of the same was mooted,
the petitioner challenged the renewal of the lease in favour of M/s. Hotel
Allied Trades and the matter had reached the Hon’ble Supreme Court of
India. Ext.P11 is referred to in this regard. Ext.P12 is the report submitted
by the Centre for Earth Science Studies (CESS) wherein they have studied
the carrying capacity development planning for Thinnakara island itself.
Again, the 4th respondent in the year 2000 invited offers for operation of
beach resorts at Kadamath and Minicoy. Ext.P13 is relied upon to sustain
the said argument and even though the petitioner submitted his offer to start
a resort at Minicoy, the bids were not finalised at that time.
13. Our attention is invited to the fact that in the year 2003 M/s. Tata
Consultancy Services was engaged to prepare a master plan for
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development of tourism in the islands. The master plan so prepared
recommended that global tenders must be invited from the prospective
entrepreneurs. It is also stated that the Island Development Authority
presided over by the Prime Minister of India at its 10th meeting accepted
the master plan and the allegations in this regard made by the petitioner
have not been denied by the respondents. It is further submitted that the
Planning Commission of the Govt. of India in Ext.P14, has also declared its
policy by way of acquiring/leasing land for new tourism projects at various
islands including Bangaram and Thinnakara. Referring to Ext.P22 which is
a reply made by the Minister for Tourism on the floor of the Lok Sabha on
23.2.2006, it is pointed out that no project proposal, complete in all respects
as per the guidelines, is pending with the Ministry of Tourism at that time.
It is submitted that the reply will further reiterate the stand of the petitioner
that there are various guidelines in this regard. Referring to Ext.P23 which
is a notice issued by the Department of Tourism, it is stated that permission
and sanction from the Administration is required for bringing tourists into
the islands and for running resorts. It is further submitted that the various
dates on which Exts.P16 and P17 issued will show that it was on the eve of
the departure of the Administrator and Shri G. Sudhakar, the Director of
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Tourism, from the island and it is pointed out that immediately after the
issuance of the orders, they left on 11.8.2006 and 22.7.2006 respectively
from the service of the Lakshadweep Administration. Along with the reply
affidavit also, the petitioner has produced various documents to show that
the policy itself was for developing the land after taking on lease by the
Government itself, and by inviting global tenders.
14. We will now refer to the documents produced by the petitioner to
consider the said argument raised vehemently by the learned counsel for the
petitioner. The said aspect is a crucial issue that has emerged in this case,
since it is contended by various respondents that no such policy by way of
the Government alone taking land, on lease available/acquisition within the
islands, was mooted. The earliest document is Ext.P3 which is a reply given
by the Department of Tourism, Union Territory of Lakshadweep to the
Director of Tourism, Govt. of India. It is stated therein that modalities for
developing three newly identified islands in Lakshadweep as international
tourist resort are being worked out in consultation with Ministry of
Tourism. Unless the strategy for the development of island resort in three
islands of Cheriyam, Suheli Valiyakara and Thinnakara is finalised by the
Ministry and final approval of the Island Development Authority is obtained
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in the matter, the Lakshadweep Administration cannot proceed further in
the matter. Admittedly, the Island Development Authority is chaired by the
Prime Minister of India. Therefore, Ext.P3 will show that a final approval
of the Island Development Authority was required and Thinnakara is one of
the islands mentioned in Ext.P3. Ext.P3 is dated 30.10.1991. This is
followed by Ext.P4 reply of the Deputy Director General, Department of
Tourism, Govt. of India, to the Administrator, Union Territory, obviously
in reply to Ext.P3. This reply will show that the matter was taken up with
all concerned Ministries/Departments of the Govt. of India for getting no
objection and a note has been forwarded to the Planning Commission
which is looking into the other related matters pertaining to opening of these
islands. The note is also appended to Ext.P4. A reading of the note will
show that the Administration of the Union Territory of Lakshadweep itself
has proposed that some islands in the Union Territory be opened for
development of international tourism by leasing its lands to private
entrepreneurs by inviting global tenders. This proposal was made
considering the success of the island resort at Bangaram. The names of the
three islands mentioned are Cheriyam, Suheli-Valiyakara and Thinnakara.
The details about these islands are mentioned in the note. The special
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features of Thinnakara island is mentioned along with the other two islands.
Lastly, it is mentioned that specific locations in Lakshadweep and Andaman
and Nicobar islands may be opened up on the basis of specified norms (a) to
(h) and importantly item (a) is that global tenders be invited for lease of
land for exclusive use of tourists for a period of 10 years extendable by
another 10 years. Ext.P5 is the notification issued by the Department of
Tourism, Govt. of India inviting offers from parties with proven capability
in the field of beach/island resorts for developing new island resorts on
long term lease in the virgin islands of Arabian Sea, Thinnakara and
Cheriyam of the Kerala coast in Lakshadweep. It is further mentioned
therein that “offers must be in accordance with the investment and
collaboration policy of the Government.” Ext.P6 is the copy of a letter by
the Deputy Director General, Department of Tourism, Govt. of India which
mentions that Govt. of India proposes to give two islands, viz. Thinnakara
and Cheriyam located at Lakshadweep on long term lease for development
of tourism resorts based on “international competitive offers” and enclosing
the form of offer and other documents. The formalities to be complied with
are mentioned in Ext.P6. The appendix to Ext.P6 gives details of the
project also. As per its specifications and guidelines, the land is to be leased
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out by the Government and item 9 states that “offers must be in accordance
with the investment and collaboration policy of the Govt. of India”.
Pursuant to the offer made by the petitioner, Ext.P8 was issued to him by
the Department of Tourism, Govt. of India regarding certain formalities to
be complied with.
15. Thus, it is evident from the above documents that there was a
clear policy on the part of the Govt. of India in regard to the development of
tourism in various parts of the Union Territory of Lakshadweep. The
activities evolved by certain Government agencies is evident from the fact
that the Society for Promotion of Nature Tourism and Sports (SPORTS)
which is a Government sponsored co-operative society and is the nodal
agency for the promotion of tourism in Lakshadweep invited global tenders
for operating tourist resorts with 58 beds at Kadamath and with 20 beds in
Minicoy. Ext.P21 is a draft of the IXth Five Year Plan 1997-98 to 2001-02
submitted by Lakshadweep Administration to the Planning Commission
with specific suggestions for tourism development. Therein, reference is
made to the preparation of a master plan, since the conventional method of
tourism development may not suit the islands. In Scheme No.4, with the
heading “objective of the scheme in IXth Five Year Plan 1997-98 to 2001-
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02″ under para 3, (page 296 of the Paper Book), the policy has been spelled
the following words: “Tourism has emerged as one of the most income and
employment generating industry in Lakshadweep. Encouraged by this and
the Bangaram model of development the the Administration has decided to
open more uninhabited islands for tourism. Proposals have been submitted
to Central Ministry for leasing out uninhabited island – Thinnakara, Suheli
Valiyakara and Cheriyam. The Ministry will be calling global tenders for
developing these islands as international tourist resorts. As the land is
limited, relatively expensive and its transaction is strictly governed by the
Lakshadweep (Protection of Scheduled Tribe) Regulation 1964, the land has
to be made available to resort at concessional rates so as not to affect the
viability of the project. Therefore, it is proposed to make land available to
develop at concessional rate of the land value. The Government will take
land on lease from land owners and let it out for resort development.
Provision under the scheme is made for the lease rent of the land in Suheli,
Thinnakara and Cheriyam.” The details of the lease rent fixed is available
under the heading “A – Physical” for all the respective areas mentioned
from 1997-98 to 2001-02. This is in respect of the three islands. This also
supports the case of the petitioner that a clear and established policy as such
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was existing. Ext.P23 is a notice issued by the Director, Tourism
Administration of Union Territory of Lakshadweep dated 7.2.2006, wherein
caution is made of the attempt to bring tourists by certain individuals
illegally. Therein, it is reiterated that “every effort should be made to stop
running of parallel tourism in the islands due to its fragile ecology, limited
carrying capacity and for security reasons.” This also indicates that the
whole policy was evolved considering the strategic importance of the
islands and in view of the peculiar circumstances prevailing there. The
policy as such for development envisaged absolute Government control and
the right to establish the resort was being given on land taken on lease from
land owners by Government, and by letting it out by inviting global tenders
only. The argument that such a policy will not apply to the projects mooted
by 5th respondent cannot, therefore, hold good.
16. Another important document relied upon by the petitioner in
support of the argument regarding this policy of the Central Government is
Ext.P25. The same is the presentation made before the Parliamentary
Committee of Transport, Tourism and Culture, when they visited the island.
The said report contains the guidelines for development of tourism and for
expansion of the potential. Various details regarding the existing tourism
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infrastructure in 9 islands like Bangaram, Kavaratti, Agatti, Kadamath,
Kalpeni and Minicoy have been mentioned. Special mention is made about
Bangaram and Thinnakara. The infrastructure proposed for Thinnakkara is
60 bed for land based and 192 beds for lagoon based. Under the heading
“Investment Avenues” it is specifically mentioned that “land/lagoon will be
given on lease for 30-40 years to private entrepreneurs through open global
tenders; operation of this is on BOT basis and and the operator to pay
minimum fee per bed per day occupied to the Government as tax/royalty for
running the resort. (Page 343 of the Paper Book). The above presentation
clearly supports the argument raised by the petitioner that it was the
Governmental policy to give land on lease to private entrepreneurs through
open global tenders.
17. That the said policy was in vogue throughout and is envisaged for
future, is re-inforced by the draft XIth Five Year Plan 2007-2012 in tourism
sector prepared by the Administration itself (Ext.P39). Under the sector
“tourism” various schemes have been put forward including the target, etc.
to be achieved during the plan period. Under the heading “B. Sector :
Tourism” Scheme 3 is relevant here. In para 1, the name of the scheme is
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given as “Opening of more islands for Tourism.” There is specific mention
about projects for Thinnakara island which is extracted below:
“Tourism has emerged as one of the most income-and-employment
generating industry in Lakshadweep. Encouraged by this Bangaram
model of development, the Administration has decided to open more
uninhabited islands for tourism. The proposal has already been
submitted for the development of tourism in Thinnakara and
Cheriyam to the Tourism Ministry and the approval from the Ministry
is expected during the 1st stage of XIth Plan.” (Internal page 267 at
page 449 of the Paper Book)
In the same paragraph it is further mentioned that “the land required for
purpose can be taken on lease from land owners and also through
acquisition.” Seven islands including Thinnakara are mentioned here as
coming under the Scheme. It is stated by the petitioner that the draft plan
was approved by the Planning Commission in its meeting held on
20.3.2007. Under para 2 in the same page, it is stated as follows:
“2) Whether continuing from previous :
Plan/New Continuing
3) Objective :
(a) Component Name : Lease rent/land actuation.
1. Description of the component: Tourism has emerged as one of
the most income and employment generating Industry in
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the Administration has decided to open more inhabited/uninhabited
islands for tourism. The proposal for the development of tourism in
Thinnakara, Suheli Valiyakara and Cheriyakara has been submitted
to the Central Ministry and the action from Ministry is expected
during XIth plan. By taking into consideration of tourism potentials
in the inhabited islands of Andrott, Kiltan, Chetlath & Birta these
islands are also proposed to pen for domestic tourists. As the land is
limited and the ownership is with the local landowners, provision
under the scheme is made for lease rent/acquisition of the land in
Thinnakara and Cheriyam and other inhabited islands. Lease rent of
the land made use by the Department for construction of resorts in
different islands will also be made under the scheme.
2. Whether continuing/new : Continuing”
It is, therefore, clear that the policy as was in existence, is being continued
which implies that the earlier policy was the same. This is quite important
to consider the issue that is raised in this writ petition. One more aspect to
be mentioned herein is that the draft envisages a tourism policy to be
finalised under the heading “description of the component”. (Internal page
268 of the Paper Book). It is stated therein that “since the land area is
limited and hence carrying capacity of each island have to be worked and
detailed report thereon is to be initiated annually and a Tourism Policy has
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in a systematic way and also for future developmental programmes.”
18. It is clear from the above documents that from 1988 to 2007 there
had been a consistent policy evolved by the Govt. of India and the Union
Territory of Lakshadweep as regards development of tourism in the islands,
which is envisaged for future continuance also. Therefore, 5th respondent
is not right in contending that the method adopted by them is unassailable.
19. Importantly, the petitioner has also produced Ext.P18 which is a
communication issued by the Administrator, Union Territory of
Lakshadweep to the various offices for publication. The subject in question
is the development of tourism in islands. The policy as discernible from the
documents already referred to, is reiterated in the said communication. He
had referred to the various models which could be thought of for putting a
suitable policy in place. It states that one of the models could be the
Maldivian Model. After referring to the same, it is stated thus: “For this
model, the Administration will have to step in to have an agreement with
the land owners to be able to have these land rights after which the resort
could be allowed to the highest bidders through global tendering process by
the Administration, after getting draft tender documents and the policy
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approved by the Ministry of Tourism, Govt. of India.” Further, it is stated
that “such a policy should be in place immediately, as interest of the land
owners should be protected by the Administration to the maximum returns
to them. This will also eliminate the possibility of any unwanted elements
and will also add other safeguards for the administration as well as the
islanders. It is all the more important as these islands are sensitive from
the strategic point of view, security point of view and environment
point of view. These issues were discussed in the various meetings relating
to the Island Development Authority and all these concerns were raised by
the Ministry of Tourism, Ministry of Environment and Forests and various
Security Agencies.” Finally it is stated that the officers concerned should
prevent any land dealings for tourism purposes till such time the policy is
put in place, so that the interest of the land owners, security of the islands,
the environmental concern etc., are duly addressed and the islanders are not
taken for a ride.” Significantly, this is dated 9.8.2006, whereas the
impugned orders are dated 7.6.2006 (Ext.P16) and 17.7.2006 (Ext.P17).
In the light of the above policy that is reiterated in Ext.P18 by the
Administrator, Union Territory of Lakshadweep also, we fail to understand
how the Administrator and the Director of Tourism could have granted
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provisional permission as done in Exts.P16 to P17(a). The petitioner is
therefore right in submitting that the policy as such from 1988 onwards till
this period is one of the Government leasing the land and allowing resorts
to be established through global tender process. As all these have been
given a go-bye by the Administration by the way in which Exts.P16 to P17
(a) have been passed, they cannot be supported at all. Learned Single Judge
has held that as far as the island of Bangaram is concerned, Exts.P16 and
P17(a) cannot survive for want of tendering process and transparency and
sanction by Government of India. The same reasoning applies to Ext.P17
as far as the establishment and operation of 72 bedded resort at Thinnakara
island and we do not find any distinguishing feature as far as the said
project is concerned.
20. We may mention here one aspect, i.e. about the stand, if any,
taken by respondents 1 to 4 in their counter affidavits in regard to the
documents relied upon by the petitioner. None of them deny the existence
of the various documents discussed above. It is not the case that the same
does not apply to the development of tourism in Lakshadweep. But
strangely, the above respondents have, in their counter affidavit, sidelined
the issue that has been raised by the petitioner relating to the violation of the
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policy. The affidavits of these respondents are clearly evasive also in
regard to the above aspects. Therefore, in the absence of any dispute
regarding the existence of the documents, it can only take that they do not
dispute the various policy formulations mentioned in the documents which
are basic to the development of tourism in the Union Territory of
Lakshadweep. In the counter affidavit filed by the Union of India, the
approach made is that the land is a State subject and therefore to allot the
land for development, the competent authority is the Union Territory
Administration. But it is admitted in para 6 that “the Ministry of Tourism
promotes the cause of tourism including Island Tourism and reviews the
progress from time to time and addresses policy issues.” The above
admission is significant in the light of the policy statements made in various
documents discussed by us already. While referring to Ext.P37 produced
by the petitioner which is a letter addressed to the Administrator, Union
Territory of Lakshadweep issued by the Govt. of India, it is stated that “the
letter emphasizes on the need to prepare a model bid document for private
entrepreneur to participate in the development of the islands. Suffice it to
say that the model bid document should be prepared keeping the
transparency principle in view.” The above admission is also significant.
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Finally, in para 8 it is stated that “it is therefore, up to the State Govt./Union
Territory Administration to follow the prescribed procedure for allotment of
land” and it is further admitted that in regard to allotment of islands to
respondents 5 and 6, it was done by the Union Territory Administration
and the Ministry of Tourism was not involved in any manner. Thus, it is
clear from the counter affidavit that the stand taken by respondents 5 to 7
and by the Union Territory that there had not been any policy or any
prescribed procedure, is not correct.
21. In the additional counter affidavit filed by the first respondent on
11.3.2007 also, no attempt has been made to deny the existence of the
policy particulars and formulations made mention of in the documents
relied upon by the petitioner. Thus, actually the stand taken by the Union of
India does not go counter to the case pleaded by the petitioner.
22. The approach made by respondents 2 and 3, i.e. the
Administrator, Union Territory of Lakshadweep and the Director of
Tourism, Union Territory of Lakshadweep, is that the 5th respondent society
offered to have joint venture in promoting tourism resorts with respondents
6 and 7. The society offered land also in the two islands and as the Ministry
of Environment had given clearance, there is nothing illegal in issuing
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Exts.P16 and P17(a). It is therefore submitted that there is no prescribed
procedure for inviting global tenders and none of the said formulations
apply to the facts of this case. In regard to the argument raised by the
petitioner that the entire aspects were done in a secret manner, in para 8 it is
stated as follows:
“It is respectfully submitted that, publication or notification is not
required for these kind of activities of the third respondent, since the
Right to Information Act is in existence, one can apply for any
document of this nature and the 3rd respondent has to make available
the applicant, the document he or she has asked for within thirty days
at the maximum.”
This approach made by respondents 2 and 3 is seen severely commented
upon by the learned Single Judge in the judgment under appeal. Clearly, the
said approach is totally evasive and does not address the questions posed
by the petitioner. Even though it is stated that the Govt. of India had
accorded necessary sanction, nothing of that sort has been produced along
with the counter affidavit. In view of the stand of the Government of India
in their counter affidavit, the same is incorrect also. Ext.R3 which is a
clearance under the Coastal Regulation Zone Notification, 1991 issued by
the Ministry of Environment of Forests, Govt. of India, has nothing to do
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with the policy aspect of the project in question. Therefore, that cannot be
treated as a sanction issued by the Govt. of India for the establishment of
the resort as such, in accordance with the procedure prescribed. The
Ministry of Tourism, Government of India and the Island Development
Authority have not cleared the projects. Going by Ext.P18 issued by the
Administrator himself these are required. It is evident therefore that there
had not been any transparent policy as far as the entire issue is concerned,
while issuing Exts.P16 to P17(a) by respondents 2 and 3.
23. We will now come to the case pleaded by respondents 5 to 8 and
its acceptability. The 5th respondent is a society registered under the
Societies Registration Act, 1860. According to them, as per Ext.R5(c), they
approached the Govt. of India, Department of Tourism by placing its
proposal to develop Thinnakara island for tourism as a joint venture with
M/s. U.B. Resorts Limited and sought necessary permission. It is stated that
the third respondent forwarded the details of the project as per Ext.R5(e), as
recommended by the second respondent, to the Ministry of Tourism
Government of India. It is their case that the Lakshadweep Pollution
Control Committee, as per Ext.R5(g) dated 26.6.1996 gave a No Objection
Certificate. Ext.R5(h) is the letter issued by the local panchayat supporting
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the efforts of the 5th respondent. Ext.R5(k) is the approval granted by the
District Panchayat, Lakshadweep for setting up beach resort at Bangaram
and Ext.R5(l) is the No Objection Certificate issued by the Pollution
Control Board, Lakshadweep for the project at Bangaram. Ext.R5(m)
environmental clearance was issued by the Department of Environment and
Forest, Lakshadweep. In the said project, the U.B. Resorts Limited was the
party with whom the 5th respondent has entered into certain agreements for
execution of the project. It is stated that on 1.9.2005 the society entered
into an agreement with another U.B. Group company, viz. V.J.M. Company
for implementing the project. Learned counsel appearing for the 5th
respondent submitted that Exts.R1 and R2 produced along with the counter
affidavit of respondents 2 and 3 will show that the argument raised by the
petitioner regarding invitation of global tender, etc. is wrong. It is
submitted that there was no restriction for any private agency to get land on
lease to enter into any joint venture with entrepreneurs and to seek
permission from the Lakshadweep Administration itself.
24. A reading of Ext.R1 only shows that it is a communication issued
by the Govt. of India, Ministry of Home Affairs to the Administrator,
Lakshadweep on 2.5.2001, without specifically referring to any of the
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projects proposed. It appears that with regard to the proposal of the
Lakshadweep Administration to open island resorts at Thinnakara,
Cheriyam and Suheli Valiyakara islands, the said Ministry was of the view
that the matter relating to the land has to be resolved in consultation with
the Department of Tourism. At any rate, Ext.R1 does not throw any further
light on the said aspect. Ext.R2 is a letter dated 6.10.1995 issued to the
President of the 5th respondent society by the Deputy Director General,
Department of Tourism, New Delhi. The subject discussed relates to the
negotiation that was being undertaken by the 5th respondent with the U.B.
Group for setting up of resort at Thinnakara. Relying upon the various
points discussed, learned counsel for respondents 5 to 7 argued that this
letter cuts at the root of the argument raised by the learned counsel for the
petitioner that permission from the Govt. of India and other agencies were
required and also that global tender is the only method. A reading of the
letter only shows that nothing has been said finally therein. Only the
various points discussed therein have been itemized as ‘A to G’. We are of
the view that neither the policy in regard to the development of the various
islands for tourism purposes nor the manner in which the same has to be
done in tune with the security concerns or the environmental aspects have
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& 1215/2008 -30-
been put a lid by the said communication, to facilitate 5th respondent’s
project. Further, it is only a letter addressed to the 5th respondent society
and it does not have any effect by way of granting permission by the Govt.
of India or the Ministry of Tourism to proceed with the project proposed by
the 5th respondent. Further, it is only issued by the Deputy Director General
of the Department of Tourism and not by any of the Ministries of the Govt.
of India. There is no clearance by the Ministries concerned. Ext.R3 is only
a clearance under the Coastal Regulation Zone Notification, 1991 for
setting up Thinna Beach Resort at Thinnakara Islands, Lakshadweep by
U.B. Resorts Limited. Obviously that cannot take the place of a valid
permission as contemplated under the policy we have referred to.
25. Now we will come to the issue of validity of the lease of land
obtained by 5th respondent in these Islands. The 5th respondent maintains
that the said society was able to obtain land on lease from the local people,
could enter into projects with other entrepreneurs and therefore there is
nothing wrong with the procedure adopted. As far as Thinnakara island is
concerned, the only project is a 72 bedded resort. Even though learned
counsel for the 5th respondent argued that the petitioner is free to avail land
and put up some project, as rightly pointed out by the learned counsel for
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& 1215/2008 -31-
the petitioner, it is rather impossible because the only project that is
envisaged therein by the Administration and the Governmental agencies is
to have a 72 bedded resort. Therefore, there is no question of the petitioner
putting up an alternate proposal. With regard to Bangaram island also,
already a resort had started functioning there in the year 1988 and at
present, as per Exts.P16 and P17(a), the 5th respondent is given the
provisional permission to open another resort therein. There also they are
claiming that the land is leased to them by the local people. Therefore, it is
a case where the 5th respondent society, apart from promoting the project,
has put forth a contention that they are having sufficient land for opening
the resort which is lacking with the petitioner and therefore the petitioner
has no locus standi to challenge the action.
26. The said argument has to be examined in the light of the
provisions of the Lakshadweep (Protection of Scheduled Tribes)
Regulation, 1964 and other provisions on which heavy reliance was placed
by the learned counsel for the petitioner to show that the 5th respondent
society could not have obtained any land directly from the local people
without any previous permission from the Administration.
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& 1215/2008 -32-
27. The Lakshadweep (Protection of Scheduled Tribes) Regulation,
1964 which was amended in 1973 is the relevant one. It is produced as
Ext.R14 along with the counter affidavit of respondents 2 and 3. The same
has been promulgated by the President of India in exercise of the powers
conferred by Article 240 of the Constitution. Under this Regulation
provisions have been made to govern the transfer by way of sale, mortgage,
lease, exchange, gift or otherwise, any land by members of Scheduled
Tribes. All of the natives of Lakshadweep are Scheduled Tribes. The
relevant provisions, viz. Regulation Nos.3(1) and and 3(3) are extracted
below:
“3(1) No member of the Scheduled Tribes shall, except with the
previous sanction of the Administrator, transfer by way of sale,
mortgage, lease, exchange, gift or otherwise, any land;
Provided that no such sanction shall be necessary in the case of
any transfer of land to the Government, a bank, a co-operative society
or any member of the Scheduled Tribes.
3(3) Any transfer, attachment or sale of any land made in
contravention of this section shall be void.”
Going by sub-regulation No.4 of Regulation No.3, “no person shall, except
with the previous sanction of the Administrator, acquire any interest in any
land situated in the Union Territory of the Laccadive, Minicoy and
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& 1215/2008 -33-
Amindivi Islands or in any product of, or crop raised on, such land.” But
under the proviso, such acquisition of any such interest by the Government,
a Bank, a co-operative society or any member of the Scheduled Tribe do not
require any previous sanction. Regulation No.4 shows that if any land is
sold in execution of the decree or order, only a member of the Scheduled
Tribe is entitled to bid at such public auction. Regulation No.5 provides for
punishment in case of contravention of the provisions as noted above.
Regulation No.6 obliges the Administrator to record the reasons while
sanctioning the transfer of any land under Regulation 3(1) or under
Regulation 4.
28. Regulation No.2 defines a bank, a co-operative society and a
Scheduled Tribe. A co-operative society coming within the purview of
Regulation No.2 means a society registered, or deemed to be registered,
under any law relating to co-operative societies for the time being in force
in the Union Territory of the Laccadive, Minicoy and Amindivi islands.
29. Respondent No.5 is not a co-operative society; it is only one
registered under the Societies Registration Act, 1860. Therefore, obviously
it will not come within the proviso to Regulation 3(1). Therefore, previous
sanction of the Administrator is required for any lease of land to the said
WA 985, 1117
& 1215/2008 -34-
society which admittedly is absent here. Going by sub-regulation (3) of
Regulation 3, any transfer, attachment or sale of any land made in
contravention of Regulation No.3 will be void.
30. The stand of the Society and the Administration in this regard
which is supported by the other respondents, is that the 5th respondent is a
society formed by members of Scheduled Tribe and as there is no restriction
with regard to any transaction between a Scheduled Tribe and another
Scheduled Tribe, the lease obtained by the 5th respondent society will not
come within the mischief of Regulation Nos.3(1) and 3(3). The writ
petitioner has got a case going by the averments in the writ petition, in the
reply affidavit and the Writ Appeal memorandum that all the members of
the 5th respondent society are not members of Scheduled Tribe. The same
has been reiterated in the arguments before us. It is contended by learned
counsel for the petitioner that the 5th respondent society has been formed by
the members of three families in Lakshadweep who have been either
working as Govt. servants or were Govt. servants. The details of all such
persons are given in the reply affidavit in paragraphs 12 to 15. It is also
contended that the deponent of the counter affidavit of the 5th respondent
society is a retired Director of Agriculture of the Lakshadweep
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& 1215/2008 -35-
Administration and he continues to be a member of the Pollution Control
Board Committee constituted by the Lakshadweep Administration even
after the retirement. (He is not a member of the society.) The President of
the 5th respondent society is an Arabic Teacher in a Government School run
by Lakshadweep Administration and his brother is the Vice President of the
society who is working as Scuba Diving Instructor under the Department of
Tourism, Lakshadweep Administration. The wife of the deponent of the
counter affidavit filed by the 5th respondent is its Treasurer and she is a
family member of the President and Vice President of the Society and is
working as Accountant in the Lakshadweep Administration. The Secretary
of the 5th respondent Society is working as Station Manager of M/s. Indian
Airlines at Agatti Airport. He was working in the Government Press at
Kavaratti under the Lakshadweep Administration. His brother is a
Veterinary Assistant Surgeon working under the Lakshadweep
Administration. He is one of the members of the society and his wife is also
another member. The brother-in-law of the Secretary of the Society is
another member and one other member is a retired Surveyor in the
Department of Revenue, Lakshadweep Administration. The 5th respondent
society has not denied these averments in its rejoinder dated 29/01/2007.
WA 985, 1117
& 1215/2008 -36-
31. The counter affidavits filed by respondents 2 to 4 in this regard
have also to be referred to. In the counter affidavit filed by respondents 2
and 3, viz. the Lakshadweep Administration, what is stated in para 7 is that
the 5th respondent is a society formed by locals, which is reiterated in para 9
of the counter affidavit. In the additional counter affidavit filed on behalf of
respondents 2 and 3, in para 13 it is stated that the society is one registered
under the Societies Registration Act, 1860 and majority of its members
are Scheduled Tribes and natives of Agatti. Significantly, none of the
details of the members have been given in the counter affidavit. The 4th
respondent, in para 11 of the counter affidavit, takes a stand that at
Bangaram and Thinnakara, the land has been leased by private
individuals/land owners to the 5th respondent, a local society, and all the
members of 5th respondent are natives of Lakshadweep and therefore, the
question of mortgage, lease, exchange, gift or otherwise of land to outsiders
does not arise. The members of the society are described as natives of
Lakshadweep only but no details of the members have been stated.
32. We may refer to the counter affidavit of the 5th respondent itself to
find out whether it throws any light on the above said aspect. In para 4,
what is stated is that the society has been formed by the inhabitants of
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& 1215/2008 -37-
Lakshadweep islands and therefore it is 100% islanders’ society. No details
of the members of the society, or their number etc. have been stated in the
said para. In para 13 of the counter affidavit, it is stated that the 5th
respondent is not a Government agency and is a society. The stand taken in
para 16 of the counter affidavit is that there is absolutely no prohibition in
transferring the land by a Scheduled Tribe belonging to the island in favour
of a society fully owned and controlled by inhabitants of islanders and
hence the provisions of the relevant regulation have not been violated.
Thus, even going by the additional counter affidavit filed by respondents 2
and 3, it only states that majority of the members of the society are natives
of Lakshadweep.
33. It is clear from the relevant provisions of the regulation that if the
transaction is between a Scheduled Tribe and another Scheduled Tribe, no
previous sanction is required. But herein, admittedly the transaction is
between locals who are members of the Scheduled Tribe and the 5th
respondent society which cannot claim itself the status of a Scheduled
Tribe. Merely because of the fact that the majority of the members of the
society belong to Scheduled Tribe, once they formed a society, they lose
their identity and the society itself being a legal entity, the status of the
WA 985, 1117
& 1215/2008 -38-
individual members as Scheduled Tribe cannot be claimed by the society.
Therefore, the society cannot claim that it being a society formed by
members of the Scheduled Tribe, the transaction is not hit by Regulation
No.3(1). The provisions of the regulation only saves the transaction
between Scheduled Tribes and the Government, Bank, co-operative society,
etc. A society formed under the Societies Registration Act does not come
within the exempted category. If that be so, if at all it can be contended that
the society is formed by the members of the Scheduled Tribe, that will not
relieve it from the obligations which are mandatorily provided under
Regulation 3(1) and 3(4). Therefore, the transaction is hit by clauses 3(1)
and 3(3) of the Regulation and the same is void.
34. The learned Single Judge took the view that the rigour of
Regulation No.3 will not apply to the 5th respondent society, since the
members of it belong to Scheduled Tribe. We are afraid, the said reasoning
cannot hold good in the light of the specific prohibition in Regulation No.3
(1) and the proviso. Previous sanction is not required only if the transfer of
land is to the Government, a bank, a co-operative Society or any member of
the Scheduled Tribe. Therefore, we hold that in the light of Regulation
Nos.3(1) and 3(3), the 5th respondent society cannot claim that the leasehold
WA 985, 1117
& 1215/2008 -39-
right, if any, obtained by them from the owners of the land survives, as the
transaction itself has been declared statutorily as void. On this ground also,
the permission granted to the 5th respondent society as per Exts.P16 to P17
(a) has to be held as illegal, being violative of the Lakshadweep (Protection
of Scheduled Tribes) Regulation, 1964. We may note one more aspect here.
Significantly, one of the conditions in Ext.P17, viz. condition No.5 states
that “provisions of the Laccadive, Minicoy & Amindivi Islands (Protection
of Scheduled Tribes) Regulation, 1964 should be complied with.”
Therefore, the Administration also has rightly understood the scope and
binding nature of the regulation. But, since this permission as per Exts.P16
to P17(a) is definitely on the premise that the society has its own land, any
direction to comply with the provisions of the regulation, after such
permission has been granted, has no meaning at all.
35. In this context, learned counsel for the petitioner relied upon the
decision of the Apex Court in Samatha v. State of A.P. and another
{(1997) 8 SCC 191) to contend that the provision in question being made in
the interest of the Scheduled Tribe, should be considered as one for welfare
of the deprived sections of the society and strict compliance should be
observed as regards the mandates of the regulation. Therein, under the
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& 1215/2008 -40-
Andhra Pradesh Scheduled Areas Land Transfer Regulation, 1959, Section
3(1)(a) prohibited transfer of immovable property situated in Agency tracts
by a person, whether or not such person is a member of ST, unless made in
favour of a person, who is a member of ST or a society composed solely of
members of Scheduled Tribe. Any transaction which is entered into in
violation of the provision is statutorily declared null and void under the
provisions of the said regulation. In paragraphs 39 and 40, their Lordships
held as follows:
“Section 3 of the Regulation prohibits transfer of immovable property
by a member of the Scheduled Tribes to a non-Scheduled Tribe
member. The transfer of immovable property between a member of
the Scheduled Tribe to a non-Scheduled Tribe member in the Agency
tracts is null and void. The non-tribal transferee acquires no right,
title and interest in that behalf in furtherance of such sale.”
36. In the light of the above dictum laid down by the Apex Court,
we have no doubt in our mind that the rigour of Regulation Nos.3(1), 3(3)
and 3(4) have been violated and it results in the transactions being treated as
null and void. The 5th respondent society acquires no right and interest in
the land said to have been given by the members of Scheduled Tribe by way
of lease to it in Bengaram and Thinnakkara. Significantly, none of the lease
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& 1215/2008 -41-
deeds have been produced before this court and details of the transaction
between the 5th respondent society and the persons holding the land and the
benefits which may accrue ultimately to them if the resort is established,
have also not been disclosed, even though it is contended that they will get
benefits by way of rent. The official respondents 2 and 3 have also not
disclosed the details of the benefit which the land holders will get by way of
rent, etc. It is obvious that the regulation is meant to protect the interest of
Scheduled Tribes and thus strict adherence to the regulations is sine-qua-
non for any valid transaction mentioned in Regulation No.3(1). Along with
I.A.No.766/2008 filed in W.A.No.1117/2008, the 5th respondent has
produced Exts.R5(b) and R5(c), to contend that the Society had obtained
prior sanction. A perusal of the said documents do not show the same.
Ext.R5(b) is only a letter from the District Registrar, stating the stamp duty
for lease deed for 25 years. That cannot be termed as a sanction for the
purpose of the Regulation. Ext.R5(c) is only a communication by the Sub
Registrar to the Deputy Registrar, conveying No Objection for registering
transfer deed. No other details are available. These two are not the
competent authorities as prescribed by the Regulation. Hence, these
documents have no value at all, to decide the issue. Under the Laccadive,
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& 1215/2008 -42-
Minicoy and Amindivi Islands (Protection of Scheduled Tribes) Rules 1967
forms have been prescribed for application for transfer of land on lease etc,
which should be submitted to the Administrator, through the Tahsildar of
the area where the land is situated. Detailed procedures are prescribed
under the said Rules to deal with such applications. Obviously, Exts.R5(b)
and R5(c) cannot have any value at all, in the light of the specific provisions
of the Rules. At any rate those cannot be termed as orders conveying
sanction as provided under the Regulation. Hence we reject the said
argument raised by learned counsel for 5th respondent.
37. Learned counsel for the petitioner also contended that the lands
situated in Bangaram and Thinnakara are Pandaram lands and none of the
land holders were granted pattayam from the Government and therefore in
that view of the matter and going by the provisions of the Laccadive,
Minicoy and Amindivi Islands Land Revenue and Tenancy Regulation,
1965 the transactions, if at all entered into by the 5th respondent, cannot be
saved. Our attention is drawn to the definition clause 2(e) and Regulation
Nos.83 and 84 in this regard. It is submitted that even though the
Administrator has right to confer occupancy, that has not been done so far.
Regulation No.84(1) reads as follows:
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& 1215/2008 -43-
“84(1) Subject to the provisions of this Regulation and the Laccadive,
Minicoy and Amindivi Islands (Protection of Scheduled Tribes)
Regulation, 1964, the rights of an occupant in his land shall be
permanent, heritable and transferable.”
Therefore, any occupant of the land can transfer the right only in accordance
with the provisions of Lakshadweep (Protection of Scheduled Tribes)
Regulation, 1964, the provisions of which we have already considered.
Inviting our attention to Regulation 98(2), it is contended that even in a case
of lease, the period of lease cannot exceed five years which will be subject
to a further renewal for five years and in this case the 5th respondent has
taken a condition that it has obtained the land on lease for 25 years. An
examination of Regulation 98(2) shows that any lease can only be for a
period of five years subject to renewal for a period of five years at a stretch.
In the light of the provisions of the above regulation also, which definitely
apply to the lands in question, the transaction entered into by the 5th
respondent society can only be stated as illegal and void.
38. As a matter of fact, the learned Single Judge has considered the
contentions on their merits and therein also no finding has been rendered
against the appellant/writ petitioner as regards his locus standi in the matter.
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Apart from that, the writ petitioner is a person who had already been
applying before the authorities, viz. respondents 1 to 4 and had actually
submitted his tenders when notifications were issued by inviting global
tenders for starting/opening resorts in Bangaram and Agatti. Even in
respect of Thinnakara, as per Ext.P5 global tenders were invited for
development of island resorts in Thinnakara and Cheriyam. He had
responded to the same by submitting Ext.P7. He had been challenging the
renewal of lease granted for the existing resort at Bangaram and had taken
out the matter up to the Hon’ble Supreme Court. Exts.P1 to P10 will show
that he had been pursuing his application submitted during various stages
for entering the field. In view of the above, it cannot be said that he is
totally unconnected with the result of the grant and therefore cannot
challenge the permission issued in favour of respondents 5 to 7.
39. We will also advert to one aspect which came to our notice. The
case pleaded by respondent No.5 is that they have entered into various
negotiations with U.B. Group and the proposals were accordingly submitted
before the authorities for getting permission. A reading of Ext.P17 will
show that the clearance dated 01/07/2003 under the Coastal Regulation
Zone Regulation, 1991 for setting up of Thinna Beach Resort at Thinnakara
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& 1215/2008 -45-
island was granted to the Pykala Society and the U.B. Resorts Private
Limited as a joint venture. Presently, as per Ext.P17 permission is granted
to M/s. Pykala Society and M/s. V.J.M. Resorts (P) Ltd., Mumbai who were
not in the picture at any point of time. The counter affidavit filed by the 5th
respondent shows that the 5th respondent society had placed its proposal to
develop Thinnakara island for tourism as a joint venture with U.B. Resorts
Limited and accordingly, applications were mooted for environmental
clearance, etc. All along, it is reiterated that the communications Exts.R5(c)
to R5(e) takes in the joint venture by Pykala Society in association with
U.B. Resorts Limited. Para 12 of their counter affidavit shows that on
1.9.2005 they have entered into an agreement with V.J.M. Company in
supersession of the agreement with U.B. Resorts for continuing the project
in Thinnakara, Parali I and Parali II islands. Accordingly, the project in
Thinnakara, Parali I and Parali II is being implemented by the society and
V.J.M. Company which is one of the U.B. Group Companies. Evidently,
the counter affidavits of the official respondents 2 and 3 do not mention
about the stage of entry of 7th respondent and no examination has obviously
been made as to their credentials in the matter. A reference to the counter
affidavit filed by respondents 6 and 8 shows that U.B. Resorts Limited
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& 1215/2008 -46-
ceased to operate and the 6th respondent company was set up to avail of the
projects for developing tourism in Lakshadweep islands and other parts of
India. Now, even if for the sake of argument it is admitted that clearances
were granted by the various authorities, viz. District Panchayat and
Pollution Control Board, those were granted only for a joint venture with
U.B. Group and the 6th respondent is no where in the picture. Thus, the
above developments will show that everything was granted without
properly assessing the merits of the parties involved.
40. Learned counsel for the appellant/writ petitioner submitted that
Exts.P16 to P17(a) cannot stand for a moment in view of the well settled
legal principles laid down by various decisions of the Apex Court. The
entire actions have been taken arbitrarily and against the proclaimed policy
in the matter and without conforming to the procedure that was being
followed from 1988 onwards in the matter of setting up of projects. It was
also contended that the Island Development Authority which is an arm of
the Planning Commission and which is chaired by the Prime Minister of
India, has not also been involved in the matter. Learned counsel relied
upon various decisions of the Apex Court to bolster up his contentions in
this regard. It is also contended that by granting permission like this, the
WA 985, 1117
& 1215/2008 -47-
interest of the Government has also not been taken into consideration and
unlike the existing resort at Bangaram which is paying an amount of Rs.75
lakhs to the Administration/SPORTS, herein the Government of India or the
Lakshadweep Administration is not benefited at all and no tax or royalty is
insisted while granting the permission. It is further submitted that as far as
Bangaram and Thinnakara are concerned, now the permission granted
exhausts such Projects and therefore a monopoly has been created in favour
of respondents 5 to 8 in the matter which is also against public interest and
such steps could not have been taken arbitrarily to favour respondents 5 to
8. It is contended that the Administration and the Director of Tourism left
service within a period of one month of the grant of permission which itself
shows that undue haste has been shown by them by taking decisions on
their own, without involving the Union of India or any of the arm of the
Union of India in the matter.
41. We will now refer to the principles laid down by the Apex Court,
in various decisions, concerning the exercise of power by the Government
or any authority when they enter into contracts or granting licence and
distributing largess. It is well settled by the decision of the Apex Court in
Ramana Dayaram Shetty v. The International Airport Authority of
WA 985, 1117
& 1215/2008 -48-
India and others (AIR 1979 SC 1628) that while entering into contracts or
granting privileges, the Government cannot act as a private person. While
answering the question whether the position of the Government is the same
as that of a private giver, their Lordships held as follows:
“Some interests in Government largess, formerly regarded as
privileges, have been recognised as rights while others have been
given legal protection not only by forging procedural safeguards but
also by confining/structuring and checking Government discretion in
the matter of grant of such largess. The discretion of the Government
has been held to be not unlimited in that the Government cannot give
or withhold largess in its arbitrary discretion or at its sweet will.”
(para 11)
In para 12 of the above decision, their Lordships agreed with the
observations of K.K. Mathew, J. (as he then was) in Punnan Thomas v.
State of Kerala (AIR 1969 Ker. 81 (FB), that “the Government is not and
should not be as free as an individual in selecting the recipients for its
largess. Whatever its activity, the Government is still the Government and
will be subject to restraints, inherent in its position in a democratic society.
A democratic Government cannot lay down arbitrary and capricious
standards for the choice of persons with whom alone it will deal” and
finally it was held as follows:
WA 985, 1117
& 1215/2008 -49-
“It must, therefore, be taken to be the law that where the Government
is dealing with the public, whether by way of giving jobs or entering
into contracts or issuing quotas or licences or granting other forms of
largess, the Government cannot act arbitrarily at its sweet will and,
like a private individual, deal with any person it pleases, but its action
must be in conformity with standard or norm which is not arbitrary,
irrational or irrelevant. The power or discretion of the Government in
the matter of grant of largess including award of jobs, contracts
quotas, licences etc., must be confined and structured by rational,
relevant and non-discriminatory standard or norm and if the
Government departs from such standard or norm in any particular
case or cases, the action of the Government would be liable to be
struck down, unless it can be shown by the Government that the
departure was not arbitrary, but was based on some valid principle
which in itself was not irrational, unreasonable or discriminatory.”
Therefore, while exercising the discretion, the Government will have to
conform to the Constitutional or public law limitations. Where a
corporation is an instrumentality or agency of Government, it would, in the
exercise of its power or discretion, be subject to the same constitutional or
public law limitations as Government (Para 20). Their Lordships further
held as follows:
“This rule also flows directly from the doctrine of equality
embodied in Article 14. Article 14 strikes at arbitrariness in State
WA 985, 1117
& 1215/2008 -50-
action and ensured fairness and equality of treatment. It requires
that State action must not be arbitrary but must be based on some
rational and relevant principle which is non-discriminatory. It must
not be guided by any extraneous or irrelevant consideration, because
that would be denial of equality. The principle of reasonableness
and rationality which is legally as well as philosophically an
essential element of equality or non-arbitrariness is projected by
Article 14 and it must characterise every State action, whether it be
under authority of law or in exercise of executive power without
making of law. The State cannot, therefore, act arbitrarily in
entering into relationship, contractual or otherwise with a third
party, but its action must conform to some standard or norm which
is rational and non-discriminatory.”
Learned counsel for the petitioner has rightly relied upon the above dictum
to contend that the argument raised by respondents 5 to 8 that respondents 2
and 3 have got unfettered discretion in granting permission for opening the
tourist resort at Bangaram and Thinnakara and which cannot be called in
question at all, is not acceptable.
42. The question whether discretion available to any public authority
is unlimited or it confines to certain limits, was considered by the Apex
Court in Delhi Transport Corporation v. D.T.C. Mazdoor Congress and
WA 985, 1117
& 1215/2008 -51-
others (AIR 1991 SC 101). Their Lordships laid down the test in para 276
in the following words:
“In this context it is important to emphasise that the absence of
arbitrary power is the first essential of the rule of law upon which
our whole constitutional system is based. In a system governed by
rule of law, discretion, when conferred upon executive authorities,
must be confined within defined limits. The rule of law form this
point of view means that decisions should be made by the
application of known principles and rules and, in general, such
decisions should be predictable and the citizen should know where
he is. If a decision is taken without any principle or without any rule
it is unpredictable and such a decision is the antithesis of a decision
taken in accordance with the rule of law.”
In Shiv Sagar Tiwari v. Union of India and others {(1997) 1 SCC 444}
their Lordships reiterated the position and in the words of Hansaria, J.,
even a Minister cannot claim unfettered discretion. Speaking for the Bench,
His Lordship laid down the principle in the following words:
“The administrative law has of late seen vast increase in
discretionary powers. But then, the discretion conferred has to be
exercised to advance the purpose to subserve which the power exists.
Even the Minister, if he/she be the repository of discretionary power,
cannot claim that either there is no discretion in the matter or
unfettered discretion.”
WA 985, 1117
& 1215/2008 -52-We respectfully follow the same and reject the arguments raised by
respondents 5 to 8 that respondents 2 and 3 had an unfettered discretion in
granting the permission based on the application and project submitted by
the 5th respondent. It is a settled proposition of law that when an action is
impugned as arbitrary, it will have to be satisfied whether any discernible
principle emerges from the impugned action and whether it really satisfy the
test of reasonableness. It is also well settled that when a statute, rule or
scheme, etc. provides for a particular mode of doing things, other modes are
excluded. When the prescribed mode is given a go-bye, such a deviation
could be supported only by any discernible principle which is reasonable.
Otherwise, the action will be held as totally arbitrary and illegal. It is well
settled that any action by the State has to be informed by reason and when
the action is unsupported by any reason, it will be termed as per-se illegal
and arbitrary. In this case, as is evident from the pleadings Ministry of
Tourism, Govt. of India or the Island Development Authority and other
Ministries were not involved in the grant of permission to respondents 5 to
7, which was mandatory as per the prescribed procedure. The clearance by
the Ministry of Environment and Forest cannot substitute a rational
assessment of the project and adoption of proper procedure. The
WA 985, 1117
& 1215/2008 -53-Department of Tourism of the Union Territory of Lakshaweep was having
only an Ex-officio Director without any senior officers in Class A or Class
B for manning his office. Only Group C and Group D employees were
there. This is clear from the materials discussed in Ext.P39 at its internal
page 262. Going by the standards laid down by the Lakshadweep
Administration itself in Ext.P18, the projects should conform to
environmental, security and other concerns. Therefore, these tests would
require support by way of proper policy and providing the benefit after
inviting global tenders to ascertain the merit and other factors relevant of
the entrepreneur. All those have been given a go-bye by the Lakshadweep
Administration here. Monopoly rights in perpetuity have been created, that
too ignoring interests of the Government concerned and without any
benefits to them. It is totally arbitrary, discriminatory and against public
interest.
43. Learned counsel for the petitioner had also relied upon the
decision of the Apex Court in M.I. Builders Pvt. Ltd. v. Radhey Shyam
Sahu and others (AIR 1999 SC 2468). Our attention was invited to the
principles laid down in paragraphs 80 and 81 (page 2504 and 2505), while
considering the challenge against permission granted for M.I. Builders for
WA 985, 1117
& 1215/2008 -54-establishing a public park and underground shopping complex in the park.
After examining the question whether it amounts to fraud on power and
whether public interest has been sacrificed in the entire matter, their
Lordships held that “judicial review is permissible if the impugned action is
against law or in violation of the prescribed procedure or is unreasonable,
irrational or mala fide.” Their Lordships further examined the question
whether the selection of one builder alone could be justified. It was
observed that “no attempt made whatsoever to consider if there was any
other person more competent for the job or if of equal competence could
offer better terms.” This test, according to us, is squarely applicable to the
facts of this case also.
44. Therefore, going by the dictum laid down in the above decisions,
we hold that Exts.P16 to P17(a) cannot be supported in law. The argument
that wide discretion has been conferred on respondents 2 and 3, cannot be
accepted at all, because they are distributing largess and it cannot be done
so without conforming to any reasonable standards and following a fair
procedure.
45. Learned counsel appearing for the appellant in W.A.No.985/2008
contended that the view taken by the learned Single Judge while quashing
WA 985, 1117
& 1215/2008 -55-Exts.P16 and P17(a) as regards the resort at Bangaram, is not correct. It is
submitted that as far as the island at Bangaram is concerned, the writ
petitioner, if interested, could procure other land for the project. We are not
impressed by the above argument. As far as Bangaram is concerned,
already there is one existing project and the project now permitted as per
Exts.P16 and P17(a) is the only other project that is offered for operators to
establish resorts. Therefore, at any rate, the petitioner cannot on his own,
put forth any proposal without any project being envisaged by the Planning
Commission itself. Therefore, there is nothing that separates the project at
Bangaram with the one proposed at Thinnakara and no distinguishing
features are available. As already held by the learned Single Judge, the
entire procedure as far as the project at Bangaram was not transparent and
the learned Judge has quashed the said orders. We do not find any reason to
interfere with the same. In the light of the view taken by us, we are not
examining the allegations of mala fides raised in the writ petition.
Hence, we dismiss W.A.Nos.985/2008 and 1215/2008 and,
W.A.No.1117/2008 stands allowed. W.P.(C).No.28200/2006 is allowed as
prayed for and Exts.P16 to P17(a) are quashed. There will be a further
direction to respondents 1 to 4 to take a fresh decision, in accordance with
WA 985, 1117
& 1215/2008 -56-the Policy, after inviting bids by global tenders and after considering all
applications. No costs.
( P.R.Raman, Judge.)
(T.R. Ramachandran Nair, Judge.)
kav/