Bangalore Medical Trust v. B.S. Muddappa and Ors.

E THOMMEN, J. Leave granted. I have had the advantage of reading in draft the judgment of my learned Brother Sahai; J. and I am in complete agreement with what he has stated. It is in support of his reasoning and conclusion that I add the following words. · A site near the Sankey's Tank in Rajmahal Vilas Extension in the City of Bangalore was reserved as an open space in an improve­ ment scheme adopted under the City of Bangalore Improvement Act, 1945. This Act was repealed by section 76 of the Bangalore Develop- . ment Authority Act, 1976 (Karnataka Act No. 12 of 1976) (hereinafter G referred to as the "Act") which received the assent of the Governor on 2.3.1976 and is deemed to have come into force on 20.12.1975. By a notification issued under section 3 of the Act, the Government con­ stituted the Bangalore Developm.ent Authority (the "BOA") thereby attracting sectio_n 76 which, so far as it is material, reads: H "S. 76. REPEAL AND SA VIN GS ( 1) On the issue of the ' I i ,) ) -" _, ,, • .,. ) ' -.... MEDICAL TRUST v. B.S. MUDDAPPA [THOMMEN, J.I 117 notification under sub-section (1) of section 3 constituting the Bangalore Development Authority, the City of Banga- lore Improvement Act, 1945 (Mysore Act 5 of 1945) shall stand repealed. (2) ....................................... ' ......... (3) ....................................... ' ......... Provided further that anything done or any action taken (including any appointment. notification. rule, regu- lation, order, scheme or bye-law made or issued, any permission granted) under the said Act shall be deemed to have been done or taken under the corresponding provi- sions of this Act and shall continue to be in force accord- ingly unless and until superseded by anything done or any action taken under this Act: Provided also that any reference in any enactment or in any instrument to any provision of the repealed Act shall unless a different intention appears be construed as a refe- rence to the corresponding provision of this Act. (4) ................................................ (emphasis supplied} Accordingly, the scheme prepared under the repealed enactment is deemed to have been prepared and duly sanctioned by the Govern- ment in terms of the Act for the development of Rajmahal Vilas Extension. In the scheme so sanctioned the open space in question has been reserved for a public park. However, pursuant to the orders of the State Government dated 27.5.1976 and 11.6.1976 and by its resolution dated 14.7.1976, the BDA allotted the open space in favour of the appellant, a medical trust, for the purpose of constructing a hospital. This site is stated to be the only available space reserved in the scheme for a public park or G play ground. This allotment has been challenged by the writ petitio­ ners (respondents in this appeal) who are residents of the locality on the ground that it is contrary to the provisions of the Act and the scheme sanctioned thereunder, and the legislative intent to protect and preserve the environment by reserving open space for 'ventila­ tion', recreation and play grounds and parks for the general public. H A The writ petitioners, being aggrieved as members of the general public and residents of the locality, have challenged the diversion of the user and allotment of the site to private persons for construction of a hospital. -~ - The learned Single Judge who heard the writ petition in the first B instance found no merit in it and dismissed the same. He held that, a hospital being a civic amenity, the allotment of the site by the BOA in favour of the present appellant for the purpose of constructing a hospi- ta! was valid and in accordance with law. On appeal by the respondents (the residents of the locality) the learned Judges of the Division Bench ~ held that, the area having been reserved in the sanctioned ;dreme for a ' c public park, its diversion from that object and allotment in favour of a private body was not permissble under the Act, even if the object of the allotment was the construction of a hospital. The learned Judges were not impressed by the argument that the proposed hospital beinc a civic amenity, the Act did not prohibit the abandonment of a pu~lic park for a private hospital. Accordingly, allowing the respondents' D appeal and without prejudice to a fresh allotment by the BOA of any alternative site in favour of the present appellant, according to law, the writ petition was allowed and the allotment of the site in question was set aside. ... The appellant's counsel submits that the learned Judges of the E Division Bench exceeded their jurisdiction in setting aside an allot- ment which was purely an administrative action taken by the BOA pursuant to a valid direction issued by the Government in that behalf. He submits that in the absence of any evidence of ma/a fide the impugned decision of the BOA was impeccable and not liable to be lf interfered with in writ jurisdiction. He says that the decision to allot a F site for a hospital rather than a park is a matter within the discretion of the BOA. The hospital, he says, is not only an amenity, but also a civic amenity under the Act, as it now stands, and the diversion of the user of the land for that purpose is justified under the Act. The respondents, on the other hand, contend that it was impro- G per to confer a largesse on a private party at the expense of the general public. The special consideration extended to the appellant, they say, _._ .... was not permissible under the Act. To have allotted in favour of the appellant an area reserved for a public park, even if it be for the purpose of constructing a hospital, was to sacrifice the public interest in preserving open spaces for 'ventilation', recreation and protection H of the environment. ·' MEDICAL TRUST v. B.S. MUDDAPPA [TH.OMMEN. J.] 119 . The scheme is undoubtedly statutory in character. In view of the fl repealing provisions contained in section 76 of the Act, which we have .in part set out above, the impugned actions affecting the scheme will be examined with reference to ihe Act. The validity of neither the Act nor the scheme is doubted. The complaiht of the writ petitioners (respondents) is that the scheme has been violated by rearnn of the impugned orders. The scheme, they point out, is a legitimate exercise B of statutory power for the protection of the residents of the locality from the ill effects of urbanisation, and the impugned orders sacrific- ing open space reserved for a public park is an invalid and colourable exercise of power to suit private interest at the expense of the general public. The Act, as enacted in 1976, has undergone several changes, but the definition of 'amenity" in clause (b) of section 2 remains unchanged. "Amenity' includes various 'conveniences such as road, drainage. lighting etc. and such other conveniences as ate notified as such by the Government. Section 2 was amended in 1984 by Karnataka Act No. 17 of 1984 to add clause (bb), after clause (b), which distinguished a 'civic amenity' from ail 'amenity'. Certain amenities were specified as civic amenities, such as dispensaries, maternity homes etc. and those amenities which are notified as civic amenities by the Government. By Act 11of1988, clause (bb) of section 2 was, w.e.f. 21.4.1984, substituted by the present clause which defines a civic amenity as, amongst others, a dispensary, a hospital, a pathologicai laboratory, a maternity home and such other amenity as the Government may by aotification, specify. Clauses (b) and (bb) of section 2 read together show that all ~hose conveniences which ate enumerated, or, notified by the Government under clause (b), are 'amenities'; and, all those amenities which are enumerated, or, notified by the Government under clause {bb), are 'civic amenities'. Significantly, a hospital is specifically stated to be a 'civic O amenity'. The concept of 'amenity' under clause {b), however. remains. unchanged. It is not clear from sub-clause (i) of clause (hb) whether a hospital which is hot run by the Government ot a civic ·corporation· but, as in the present case. by a private body, Would qualify as 'civic amertity". Nor is it clear whether a hospital was either ali 'amenity' or a ·civic amenity· Lintii it was specifically stated to be the H latter by the Amendment Act 11 of 1988. The respondents (residents) • A contend that a hospital did not have the status of an 'amenity' and much less a 'civic amenity' until Act 11 of 1988 so stated. But perhaps the appellant rightly contends that Act 11 of 1988 was merely clarifi- catory of· what was always the position, and the hospital has always .... been regarded as an 'amenity', if not a 'civic amenity'. However, on B the facts of this case, it is unnecessary to pursue this point further. Nor is it necessary to consider whether a privately owned and managed hospital, as in the present case, is an 'amenity' for the purpose of the Act. The question really is whether an open space reserved for a park or play ground for the general public, in accordance with a formally approved and published development scheme in terms of the Act, tan be allotted to a private person or a body of persons for the. purpose of constructing a hospital? Do the members of the public, being residents of the locality, have a right to object to such diversion of the user of the space and deprivation of a park meant for the general public and D for the protection of the environment? Are they in law aggrieved by such diversion and allotment? To ascertain these points, we must first look at the relevant provisions of the Act. ,_ ... Chapter III of the Act deals with 'development schemes'. The BDA is empowered to draw up detailed schemes for the development E of the Bangalore Metropolitan Area. It may, with the previous approval of the Government, undertake from time to time any work for such development and incur expenditure therefor. The Govern- ment is also empowered to require the BDA to take up any develop- ment scheme or work and execute the same, subject to such terms and > conditions as may be specified by the Government (See section 15). F Section 16 provides that such development schemes must provide for various matters, such as acquisition of land, laying and re-laying of land, construction and reconstruction of buildings, formation and alteration of streets, drainage, water supply and electricity. In 1984 this section was amended by Act 17 of 1984 by inserting clause (d) so as to provide for compulsory reservation of portions of the layout for G public .parks and play grounds and also for civic amenities. Section 16( l)(d) provides: "S. 16. PARTICULARS TO BE PROVIDED FOR IN A DEVELOPMENT SCHEME-Every development scheme under section 15: (!) shall, within the limits of the area H comprised in the scheme, provide for: - MEDICAL TRUST v. B.S. MUDDAPPA [THOMMEN, J.J 121 (d) the reservation of not less than fifteen per cent of the A total area of the layout for public parks and play grounds and an additional area of not less than ten percent of the total area of the layout for civic amenities." This provision thus treats 'public parks and play grounds' as a different B and separate amenity or convenience from a 'civic amenity'. 15% and 10% of the total area of the layout must respectively be reserved for (I) public parks and play grounds, and, (2) for civic amenities. The extent of the areas reserved for these two objects are thus separately and distinctly stated by the statute. The implication of this conceptual distinction is that land reserved for a public park and play ground cannot be utilised for any 'civic amenity' including a hospital. C Section 16(2) says: . "S. 16(2) may, within the limits aforesaid, provide for- (a) (b) forming open spaces for the better ventilation of the area comprised in the scheme or any adjoining area; (c) The need for open space for 'better ventilatfon' of the area is thus emphasised by this provision. One of the main objects of public parks or play grounds is the promotion of the health of the community by ., means of 'ventilation· and recreation. It is the preservation of the quality of life of the community that is sought to be protected by means F of these regulations. Section 17 lays down the procedure to be followed on completion of a development scheme. It deals with, amongst other things, the method of service of notice on affected parties. Section 18 deals with the procedure for sanctioning the scheme. The BOA must submit to G the Government the scheme together with the particulars such as plans, estimates, details of land to be acquired etc. and also represen­ tations, if any, received from persons affected by the scheme. On consideration of the proposed scheme, the Government is emp<iwered under sub-section (3) of section 18 to accord its sanction for the scheme. H Section 19 says that when necessary sanction is accorded by the Government, it should publish in the Official Gazette a declaration as to the sanction accorded and the land proposed to be acquired for the scheme. Sub-section (4) of section 19 says: "19(4) If at any time it appears to the Authority that an improvement can be made in any part of the scheme, the Authority may alter the scheme for the said purpose and shall subject to the provisions of sub-sections (5) and (6), forthwith proceed to execute the scheme as altered." This means that the BOA may, subject to certain restrictions con­ tained in sub-sections (5) and (6), alter the scheme, but such alteration has to be carried out pursuant to a formal decision duly recorded in the manner generally followed by a body corporate. The scheme is a statutory instrument which is administrative legislation involving a great deal of gene ml law-making of universal application, and it is not, therefore, addressed to individual cases of persons and places. Altera­ tion of the scheme must be for the purpose of improvement and better development of the City of Bangalore and adjoining areas and for general application for the benefit of the public at large. Any altera­ tion of the scheme with a view to conferring a benefit on a particular pef'on, and without regard to the general good of the public at large, is not an improvement contemplated by the section. See the principle stated in Shri Sitaram Sugar Company Limited & Anr. etc. v. Union of India & Ors., I 1990] I SCR 909, 937, et. seq. Section 30 has not been amended, and, so far as it is material, reads: "30. STREETS ON COMPLETION TO VEST IN AND BE MAINTAINED BY CORPORATION- ( !) (2) Any open space including such parks and play grounds as may be notified by the Government reserved for ventila­ tion in any part of the area under the jurisdiction of the Authority as part of any development scheme sanctioned by the Government shall be transferred on completion to the Corporation foi maintenance at the expense of the Corporation and shall thereupon vest in the Corporation. (3) .(emphasis supplied) MEDICAL TRUST v. B.S. MUDDAPPA [THOMMEN, J.] 123 Sub-section (2) of this section thus refers to open space, including parks and play grounds, notified by the Government as reserved for 'ventilation'. Section 31 prohibits transfer by sale or otherwise of sites for the purpose of construction of buildings until all the improvements specified in section 30, including parks and play grounds, have been provided for in the estimates. Section 32 prohibits any person from forming any extension or layout for the purpose of construction of buildings without specific sanction of the BOA. Section 33 has empowered the Commissioner of the BOA to order alteration or demolition of buildings constructed otherwise than in conformity with the sanction of the BOA. These provisions have not undergone any material change. Chapter V of the Act deals with property and finance of the BOA. Section 38 reads: "38. POWER OF AUTHORITY TO LEASE, SELL OR TRANSFER PROPERTY-Subject to such restrictions, conditions and limitations as may be prescribed, the D Authority shall have power to lease, sell or otherwise trans- fer any movable or immovable property which belongs to it, and to appropriate or apply any land vested in or acquired by it for the formation of open spaces or for build- ing purposes or in any other manner for the purpose of any development scheme." E (emphasis supplied) This section also has not undergone any material change. It says that, ;, subject to such restrictions, conditions etc., as may be prescribed, the BOA has the power to lease, sell or otherwise transfer any movable or immovable property which belongs, to it, and to appropriate or apply F any land vested in it or acquired by it for the formation of 'open spaces' or for building purposes or in any other manner for the purpose of any development scheme. This implies that land once appropriated or applied or earmarked by formation of 'open spaces' or for building purposes or other development in accordance with a duly sanctioned scheme should not be used for any other purpose unless the scheme G ...._ itself, which is statutory in character, is formally altered in the manner that the BOA as a body corporate is competent to alter. This section, of course, empowers the BOA to lease or sell or otherwise transfer any property. But that power has to be exercised consistently with the appropriation or application of land for formation of 'open spaces' or for building purposes or any other development scheme sanctioned by H the Government. Property reserved for open space in a duly sanc­ tioned scheme cannot be leased or sold away unless the scheme itself is duly altered. Any unauthorised deviation from the cluly sanctioned scheme by sacrificing the public interest in the preservation and pro­ tection of the environment by means of open space for parks and play grounds alld 'ventilation' will be contrary to the legislative intent, and an abuse of the statutory power vested in the authorities. That this is the true legislative intent is left in no doubt by the subsequent amendment by Act 17'of 1984, inserting section 38A, which reads: "38A. PROHIBITION OF THE USE OF AREA RE­ SERVED FOR PARKS, PLAY GROUNDS AND CIVIC AMENITIE~ FOR OTHER PURPOSES-The authority shall not sell or otherwise dispose of any area reserved for public parks and play grounds and civic amenities, for any other purpose and any disposition so made shall be null and void." (emphasis supplied) This amendment of 1984, which came into force on 17.4.84, is merely clarificatory of what has always been the legislative intent. The new provision clarifies that it shall not be open to the BOA to dispose of any area reserved for public parks and play grounds and civic amenities. Any such site cannot be diverted to any other purpose. Any E action in violation of this provision is null and void. The legislative intent to prevent the diversion of the user of an area reserved for a public park or play ground or civic amenity is reaffirmed by the Bangalore Development Authority (Amendment) Act, 1991 (Karnataka Act No. 18 of 1991) which came into force w.e.f. F 16.1.1991, and which substituted a new section 38A in the place of the earlier provision inserted by Act 17 of the 1984. Section 2 of the Karnataka Act 18 of 1991 reads: "S. 2. Substitution of section 38A-For section 38A of the Bangalore Development Authority Act, 1976 (Karnataka G Act 12 of 1976 (hereinafter referred to as the principal Act), the following shall be deemed to have been substi­ tuted with effect from the twenty first day of April, 1984, namely: '38A. Grant of area reserved for civic amenities etc: (1) The Authority shall have the power to lease, sell or . ' ~. MEDICAL TRUST v. B.S. MUDDAPPA (THOMMEN, J.J 125 otherwise transfer any area reserved for civic amenities for the purpose for which such area is reserved. (2) The Authority shall not sell or otherwise dispose of any area reserved for public parks and playgrounds and civic amenities, for any other purpose and any disposition so made shall be null and void- B Provided that where the allottee commits breach of any of the conditions of allotment, the Authority shall have right to resume such site after affording an opportunity of being heard to such allottee' ." This new section 38A, as clarified in the Statement of Objects and Reasons and in the Explanatory Statement attached to L.A. Bill No. 6 of 1991, removed the prohibition against lease or sale or any other transfer of any area reserved for a civic amenity, provided the transfer is for the same purpose for which the area has been reserved. This means that once an area has been stamped with the character of a particular civic amenity by reservation of that area for such purpose, it cannot be diverted to any other use even when it is transferred to another party. The rationale of this restriction is that the scheme once sanctioned by the Government must operate universally and the areas allocated for particular objects must not be diverted to other objects. This means that a site for a school or hospital or any other civic amenity must remain reserved for that purpose, although the site itself may change hands. This is the purpose of sub-section ( 1) of section 38A, as now substituted. Sub-section (2) of section 38A, on the other hand, emphasises the conceptual distinction between 'public parks and play grounds' forming one. category of 'space' and 'civic amenihes' forming another category of sites. While public parks and plav grounds cannot be parted with by the BOA for transfer to private hands by reason of their statutory dedication to the general public, other areas reserved for- civic amenities may be transferred to private patties for the specific purposes for which those areas are reserved. There is no prohibition, as such, against transfer of open spaces reserved for public parks or play grounds, whether or not for consideration, but the transfer is limited to public authorities and their user is limited to the purposes for which they are reserved' under the scheme. The distinc­ tion is that while public parks and play grounds are dedicated to the public at large for common use, and must therefore remain with the State or its instrumentalities, such as the BOA or a Municipal Corpo­ ration or any other authority, the civic amenities are not so dedicated, 0 but only reserved for particular or special purposes. This restriction against allotment of public parks and play grounds is further emphasised by section 3 of the Karnataka Act 18 of 1991 which reads: "S.3. Validation of allotment of civic amenity sites­ Notwithstanding anything contained in any law or judg­ ment, decree or order of any court or other authority, any allotment of civic amenity site by way of sale, lease or otherwise made by the authority after the twenty-first day of April, 1984, and before the Seventh day of May, 1988 for the purposes specified in clause (bb) of Section 2 of the principal Act, shall, if such. site has been made use of for the purpose for which it is allotted, be deemed to have been validly made and shall, have effect for all purposes as if it had been made under the principal Act, as amended by this Act and accordingly: (i) all acts or proceedings, or things done or allot­ ment made or action taken by the Authority shall, for all purposes be deemed to be and to have always been done or taken in accordance with law; and (ii) no suit or other proceedings shall be instituted, maintained or continued in any court or before any autho­ rity for cancellation of such allotment or. demolition of buildings constructed on the sites so allotted after obtaining building licences from the Authority onhe (local authority concerned or for questioning the validity of any action or) things taken or done under section 38A of the principal Act, as amended by this Act and no court shall enforce or recognise any decree or order' declaring any such allotment made, action taken or things done under the principal Act, as invalid." The evil that was sought to be remedied by the validation provision is in regard to allotment of "civic amenity sites", and not public parks or G play grounds (see also the Explanatory Statement attached to the Bill). All these provisions unmistakably point to the legislative intent to preserve· a public park or public play ground in the hands of the general public, as represented by the BOA or any other public aumo­ rity, and thus prevent pnvate hands from grabbing them for private ends. It must also be stated here that the validation clause relates to H the period between 21.4.1984 and 7 .5,1988 which was long after the impugned allotment. \. MEDICAL TRUST v. B.S. MUDDAPPA [THOMMEN, J.l 127 Section 65 empowers the Government to give such directions to the BDA as are, in its opinion, necessary or expedient for carrying out the purposes of the Act. It is the duty of the BDA to comply with such directions. It is contended that the BDA is bound by all directions of the Government, irrespective of the nature or purpose of the direc­ tions. We do not agree that the power of the Government under section 65 is unrestricted. The object of the directions must be to carry out the object of the Act and not contrary to it. Only such directions as arc reasonably necessary or expedient for carrying out the object of the enactment are contemplated by section 65. If a direction were to be issued by the Government to lease out to private parties areas reserved in the scheme for public parks and play grounds, such a direction would not have the sanctity of section 65. Any such diversion of the user of the land would be opposed to the statute as well as the object in constituting the BDA to promote the healthy development of the city and improve the quality of life. Any repository of power-be it the Government or the BDA must act reasonably and rationally and in accordance with law and with due regard to the legislative intent. It is contended on behalf of the appellant that section 38A pro­ hibiting sale or any other disposal of land reserved for 'public parks or play grounds', and section 16(l)(d) requiring that 15 per cent of the total area of the layout be reserved for public parks and play grounds, and an additional area of not less than ten per cent of the total area of the layout for civic amenities, were enacted subsequent to the relevant E orders of the Government dated 27.5.1976 and 11.6.1976 and the resolution of the BOA dated 14.7.76 resulting in the allotment of the site in favour of the appellant. Counsel says that at the material time when the Government made these orders and the BDA acted upon · them there was no restriction on the diversion of the user of land reserved for a public park or play ground to any other purpose. F Significantly, the original scheme, duly sanctioned under the Act, includes a public park and the land in question has been reserved exclusively for that purpose. Although it is open to the BDA to alter the scheme, no alteration has been made in the manner contemplated by section .19( 4 ). It is, however, true that certain steps had been taken G by the Government and the BOA to allot the open space in question to the appellant. My learned brother Sahai, J. has referred to the letter dated 21st April, 1976 addressed by the Chairman of the BDA to the Chief Minister and the endorsement made by the Chief Minister on that letter as well as the Orders of the Government dated 27th May, 1976 and I Ith June, 1976 sanctioning conversion of the low .level park H 128 SUPREME COURT REPORTS I 1991] 3 S.C.R. into a civic amenity site and allotting the same to the appellant. These orders were followed by a resolution adopted by the BOA on 14th July, 1976 reading as follows: "393. Allotment of C.A. Site to Bangalore Medical Trust for construction of Hospital in Rajmahal vilas Extension. It was resolved- The Government Order No. HMA 249 MNG 76 Bangalore dt. 17.6.1976 regarding allotment of C.A. site situated next to the land allotted to H.K.E. Society in Rajmahal vilas Extension, Bangalore, in favour of Banga­ lore Medical Trust for construction of Hospital to read and recorded with confirmation for further action in the matter'." These documents leave no doubt that the action of the Government D and the BOA resulting in the resolution dated 14th July, 1976 have been inspired by individual interests at the costs and to the disad­ vantage of the general public. Public interest does not appear to have guided the minds of the persons responsible for diverting the user of the open space for allotment to the appellant. Conversion of the open space reserved for a park for the general good of the public into a site E for the construction of a privately owned and managed hospital for private gains is not an alteration for improvement of the scheme as contemplated by section 19, and the impugned orders in that behalf are a flagrant violation of the legislative intent and a colourable exer­ cise of power. In the circumstances, it has to be.concluded that no valid decision has been taken to alter the scheme. The schem·e pro- F vi des for a public park and the land in question remains dedicated to the public and reserved for that purpose. It is not disputed that the only available space which can be utilised as a public park or play ground and which has been reserved for that purpose is the space under consideration. G The scheme is meant for the reasonable accomplishment of the statutory object which is to promote the orderly development of the City of Bangalore and adjoining areas and to preserve open spaces by reserving public parks and play grounds with a view to protecting the residents from the ill-effects of urbanisation. It is meant for the development of the city in a way that maximum space is provided forthe H benefit of the public at large for recreation, enjoyment, 'ventilation' ....... MEDICAL TRUST v. B.S. MUDDAPPA (TIIOMMEN, J.] 129 and fresh air. This is clear from the Act itself as it originally stood. The A amendments inserting sections 16(1)(d), 38A and other provisions are clarificatory of this object. The very purpose of the BOA, as a statu-.,, tory authority, is to promote the Jiealthy growth and development of the City of Bangalore and the area adjacent thereto. The legislative intent has always been the promotion and enhancement of the quality of life by preservation of the character and desirable aesthetic features B of the city. The subsequent amendments are not a deviation from or alteration of the original legislative intent, but only an elucidation or affirmation of the same. ' ·~, Protection of the environment, open spaces for recreation and fresh air, play grounds for children, promenade for the residents, and c other conveniences or amenities are matters of great public concern and of vital interest to be taken care of in a development scheme. It is that public interest which is sought to be promoted by the Act by establishing the BOA. The public interest in the reservation and preservation of open spaces for parks and play grounds cannot be sacrificed by leasing or selling such sites to private persons for conver- D .,. sion to some other user. Any such act would be contrary to the legisla- tive intent and inconsistent with the statutory requirements. Further- • more, it would be in direct conflict with the constitutional mandate to ensure that any State action is inspired by the basic values of individual freedom and dignity and addressed to the attainment of a quali_ty of life which makes the guaranteed rights a reality for all the citizens. E See Kharak Singh v. The State of U.P. & Others, [19641 1 SCR 332; Municipal Council, Ratlam v. Shri Vardhichand & Ors., [19811 1 SCR 97; Francis Coralie Mullin v. The Administrator, Union Territory of ·{, Delhi & Ors., [198112 SCR 516; Olga Tellis & Ors. v. Bombay Munici- pal Corporation & Ors., [1985] 3 SCC 545; State of Himachal Pradesh & Anr. v. Urned Ram Sharma & Ors., AIR 1986 SC 847 and Vikram F Deo Singh Tomar v. State of Bihar, AIR 1988 SC 1782. Reservation of open spaces for parks and play grounds is univer- sally recognised as a legitimate exercise of statutory_power rationally related to the protection of the residents of the locaiity from the ill- effects of urbanisation. See for e.g: Karnataka Town and Country G -~ Planning Act, 1961; Maharashtra Regional and Town Planning Act, 1966; Dombay Town Planning Act, 1954; The Travancore Town and· Country Planning Act, 1120; The Madras Town Planning Act, 1920; and the Rules framed under these Statutes; Town & Country Planning Act, 1971 (England & Wales); Encyclopaedia Americana, Volume 22, page 240; Encyclopaedia of the Social Sciences, Volume XII at page H 161; Town lmporvement Trusts 111 India. 1945 by Rai Sahib Orn Prakash Aggarawala, p. 35; et. seq.: Hu/sbury"s Statutes, Fourth Edition, p. 17 et. seq. and Journal of Planning & Environment Law, 1973, p. 130 et. seq. See also: Penn Central Transportation Company v. City of New York, 57 L.Ed. 2d 631 [438 US 104 (1978) ]; Village of Belle Terre v. Bruce Boraas, 39 L.Ed. 2d 797 [416 US I (1974)]; Village of Euclid v. Ambler Realty Company, 272 US 365 (1926) and Halsey v. Essa Petroleum Co. Ltd., [1961] l WLR 683. In Agins v. City of Tiburon, 447 US 255 ( 1980), the Supreme Court of the United States upheld a zoning ordinance which provided· ... it is in the public interest to avoid unnecessary conversion of open space land to strictly urban uses, thereby protecting against the resultant impacts, such as ...... pollution, .... destruction of scenic beauty, disturbance of the ecology and the environment, hazards refated to geology, fire and flood. and other demonstrated consequences of urban sprawl". Upholding the ordinance. the Court said: " .... The .State of California has determined that the development of local open-space plans will discourage the "premature and unnecessary conversion of open-space land to urban uses". The specific zoning regulations at issue are exercises of the city "s police power to protect the residents of Tiburor. from the ill-effects of urbanization. Such governmentai purposes long have been recognized as legitimate. The zoning ordinances benefit the appellants as well public by serving the city's interest in assuring careful and orderly development of residential property with provision F for open-space areas .... See comments on this decision by Thomas J. Sehoenbaum, Environmental Policy Law, 1985 p. 438 et. seq. See also Summary and Comments, [ 1980] JO E.L.R. 10125 et. seq." l'he statutes in force in India and abroad reserving open ~paces G for parks and play grounds are the legislati-;e attempt to eliminate the misery of disreputable housing condition caused by urbanisation. Crowded urban areas tend to spread disease, crime and immorality. As stated by the U.S. Supreme Court in Samuel Berman v. Andrew Parker, 99 L. Ed. 27 348 US 26: " .... They may also suffocate the spirit by reducing the . \ .J.. -r. • MEDICAL TRUST v. B.S. MUDDAPPA (THOMMEN, J.l 131 people who live there to the status of cattle. They may indeed make living an almost insufferable burden. They may also be an ugly sore, a blight on the community which robs it of charm, which makes it a place from which men turn. The misery of housing may despoil a community as an open sewer may ruin a river. ..... The concept of the public welfare is broad and inclusive .... The values it represents are spiritual as well as physical, aesthetic as well as monetary. It is within the power of the legislature to determine that the community should be beautiful as well' as healthy, spacious as well ·as clean, well-balanced as well as carefully patrolled. Jn the present case, the Congress and its authorized agencies have made determinations that take into account a wide variety of v1lues ..... " .. (Per Douglas, J.). Any reason~ legislative attempt bearing a rational relation­ ship to a permissible state objective in economic and social planning will be respected by the courts. A duly approved scheme prepared in accordance with the provisions of the Act is a legitimate atten1pt on the part of the Government and the statutory authorities to ensure a quiet place free of dust and din where children can run about and the aged and the infirm can rest, breath fresh air and enjoy the beauty of nature. These provisions are meant to guarantee a quiet and healthy atmosphere to >uit family needs of persons of all stations. Any action which tends to defeat that object is invalid. As stated by the U.S. Supreme Court in Village of Belle Terre v. Bruce Boraas, 39 L. Ed. 2d 797 416 us 1: " .... The police power is not confined to elimination of filth, stench, and unhealthy places. It is ample to lay out zones where family values, youth values, and the blessings of quiet seclusion and clean air make the area a sanctuary ior people". See also Village of Euclid v. Ambler Realty Company, 272 U.S. 365 1926. See the decision of the Andhra Pradesh High Court in T. Damo­ dhar Rao & Ors. v. The Special Officer, Municipal CorporatiOn of Hyderabad & Ors., AIR 1987 AP 171. The residents of the locality are the persons intimately, vitally H 132 SUPREME COURT REPORTS ( 1991] 3 S.C.R. and adversely affected by any action of the BOA and the Government which is destructive of the environment and which deprives them of facilities reserved for the enjoyment and protection of the health of the public at large. The residents of the locality, such as the writ petitio­ ners. are naturally aggrieved by the impugned orders and they have, therefore, the necessary locus standi. Jn the circumstances, we are of the view that, apdrt from the fact that the scheme has not been validly altered by the BDA, it was not open to the Government in terms of section 65 to give a direction to the BDA to defy the very object of the Act. The impugned orders of the Government dated 27 .5.1976 and l l.6.1976 and the consequent decision of the BOA dated 14.7.1976 are inconsistent with, and contrary to, the legislative intent to safeguard the health, safety and general welfare of the people of the locality. These orders evidence a colourable exercise of power, and are opposed to the statutory scheme. The impugned orders and the consequent action of the BOA in allotting to private persons areas reserved for public parks and play grounds and permitting construction of buildings for hospital thereon are, in the circumstances, declared to be null and void and of no effect. R.M. SAHAI, J. Public park or private nursing home which serves public interest, better, is itself an interesting issue in this appeal directed against order of the Karnataka High Court, apart, from if the conversion of the site from park to hospital was in accordance with law and whether a private hospital was an amenity or civic amenity under the Bangalore Development Authority Act (Act 12 of 1976) (in brief the Act) and in any case could it be considered as an improvement, under Section 19( 4) of the Act, if so whether the authorities while doing so acted within the constraints of law. Factual martix is quite simple and plain. But before narrating it or entering into merits of variQus issue~ -~t is imperative to sort out at the threshold if a private nursing home with modern facilities and sophisticated instruments is more conducive to the public interest than a park as it was stressed that even if the conversion of the site suffered from any infirmity procedural or substantive the High Court should have refrained from exercising its extraordinary jurisdiction and that also in favour of those residents many of whom did not have their houses around the park and thus could not be placed in the category of .... ,. . MEDICAL TRUST v. B.S. MUI'DAPPA .(SAHA!, J.l 133 persons aggrieved. It was also emphasised that the hospital with research centre and even free service being more important from social angle the inhabitants of th~ locality could not be said to suffer any injury much less substantial injury. Locus standi to approach by way of writ petition and refusal to grant relief in equity jurisdiction are two different aspects, may be with same result. One relates to maintainability of the petition and other to exercise of discretion. Law on the former has marched much ahead. Many milestones have been covered. The restricted meaning of aggrieved person and narrow outlook of specific in jury has yielded in favour of broad and wide construction in wake of public interest litiga- . tion. Even in private challenge to executive or administrative action having extensive fall out the dividing line between personal injury or loss and injury of a public nature is fast vanishing. Law has veered round from genuine grievance against order affecting prejudicially to sufficient interest in the matter. The rise in exercise of power by the executive and comparative decline in proper and effective administra­ tive guidance is forcing citizens to espouse challenges with public interest flavour. It is too late in the day, therefore, to claim that petition filed by inhabitants of a locality whose park was converted into a nursing home had no cause to invoke equity jurisdiction of the High Court. In fact public spirited citizens having faith in rule of law are rendering great social and legal service by espousing cause of public nature. They cannot be ignored or overlooked on technical or conservative yardstick of the rule of locus standi or absence of personal loss or injury. Present day development of this branch of jurisprudence is towards freer movement both in nature of litigation and approach of the courts. Residents of locality seeking protection and maintenance of environment of their locality cannot be said to be busy bodies or interlopers S.P. Gupta v. Union of India, [1982] 2 SCR 985=AIR 1982 SC 149; Akhil Bhartiya Soshit Karamchari Sangh v. U.O.I., [1981] 1 SCC 246=AIR 1981 SC 293 and Fertilizer Corpora- tion Kamgar Union v. U.O.I., AIR 1981 SC 364. Even otherwise physical or personal or economic injury may give rise to civil or crimi- nal action but violation of rule of law either by ignonng or affronting individual or action of the executive in disregard of the provisions of G law raises substantial issue of accountability of those entrusted with responsibility of the administration. It furnishes enough cause 'Of action either for individual or community in general to approach by way of writ petition and the authorities cannot be permitted to seek shelter under cover of technicalities of locus standi nor they can be heard to plead for restraint in exercise of discretion as grave issues of H public concern outweigh such considerations. Public park as a place reserved for beauty and recreation was developed in 19th and 20th Century and is associated with growth of the concept of equality and recognition of importance of common m. n. Earlier it was a prerogative of the aristocracy and the affluent either as a result of royal grant or as a place reserved for private pleasure. Free and healthy air in beautiful surroundings was privilege of few. But now it is a, 'gift from people to themselves'. Its importance has multiplied with emphasis on environment and pollution. Jn modern planning and development it occupies an important place in social ecology. A private nursing home on the other hand is essentia- lity a commercial venture, a profit oriented industry. Service may be its moto but earning is the objective. Its utility may not be undermined but a park is a necessity not a mere amenity. A private nursing home cannot be a substitute for a public park. No town planner would pre­ pare a blue print without reserving space for it. Emphasis on open air and greenery has multiplied and the city or town planning or develop- D ment acts of different States require even private house-owners to leave open space in front and back for lawn and fresh air. In 1984 the BD Act itself provided for reservation of not less than fifteen per cent of the total area of the lay out in a development scheme for public parks and playgrounds the sale and disposition of which is prohibited under Section 38A of the Act. Absence of open space and public park, E in present day when urbanisation is on increase, rural exodus is on large scale and congested areas are coming up rapidly, may given rise to health hazard. May be that it may be taken care of by a nursing home. But it is axiomatic that prevention is better than cure. What is lost by removal of a park cannot be gained by establishment of a nursing home. To say, therefore, that by conversion of a site reserved for low lying into a private nursing home social welfare was being promoted was being oblivious of true character of the two and their utility. Merits, too, raise issues of far reaching importance. One of them being the efficacy of exercise of individualised discretion where law or G the rules contemplate participatory objective decision or conclusion. Another is the requirement of substantive fairness in dealings by government or local bodies or public institutions with people of any strata of society uniformly and equally. To begin with the factual set­ ting in which the controversy arose it is undisputed that the City Improvement Board constituted under City of Bangalore Improve- H ment Act, 1945, prepared the development scheme for bringing into \ 1'-· , "f r ~i: -~ MEDICAL TRUST v. B.S. MUDDAPPA [SAHA!, J.) 135 existence an extension of the City of Bangalore which came to be known as the Palace Upper Orchards/Sadashiv Nagar, later came to be known as Raj Mahal Vilas Extension. Jn this an area facing, the Sankey tank, was earmarked for being developed as a low level park. Jn 1976 the Improvement Act was repealed and replaced by Act 12 of 1976 which came into force with effect from December, 1975. Section 76 of the Act while repealing Improvement Act by Section .76 saved the scheme by proviso Second to Sub-Section (3) of the Section and pro­ vided that it shall be deemed to have been done under corresponding provisions of the Act. The Act received the assent in March 1976. And in the same month the Chairman of the Bangalore Development Authority received a communication from the Chief Minister of the State that the Bangalore Medical Trust, the appellant (referred as BMT) was keen to have the plot reserved for park as nursing home . .On it the Chairman, without any meeting of any Co!llmittee or the Development Authority, wrote a le.tier to the Chief Minister on 21st April, 1976, the contents of which are extracted below: "No. PS. 56/76-77 Encl . .One 131ue Print. Respected sir, Re: Grant ,of land to Bangalore Medical Trust for ,construction of a n'ursing home. ....... The Bangalore Medical Trust have applied to your goodself on 30.3.1976 for grant of vacant land situated next to that given to H.K.E. Society, Rajmahal Vilas Exten- sion, on which you have passed orders "Chairman, BDA-A suitable site for ·!he proposed ·hospital building may be given. l herewith enclose a blue-print showing the location ·of !he ;;aid !)lot, which they have requested. In the blue ·print approved by the erstwhile City Improvement Trust Board, Bangalore, this site is marked as a Low Level Park, which measures approximately 13,485 sq. yds. This is a low level .area when compared to the surrounding -ground level. The sponsors of Bangalore Medical Trust are very keen to secur~ this land for their use to construct a nursing home 8 136 SUPREME COURT REPORTS (1991) 3 S.C.R. with eminent specialists to cater meoical relief to the needy public. In the first instance, it has to be approved by the Government to convert this low level park as a civic amenity site. Secondly Government has to approve the allotment of the said land to the Bangalore Medical Trust as a Civ.ic Amenity Site. Therefore, I seek your kind orders in the matter,.how I should act. With warm regards, Yours sincerely. sd//-." On it the Chief Minister made an endorsement is his ciwn hand which reads as under: "This area which was allowed to be kept for laying a park may be converted into C.A. Site. Another simiiar bit kept for the same purpose has been given away for Education Society some years back. And this remaining area is said to be not suitable for park." E In consequence of the direction by the Chief Minister the Government on 27th May, 1976 converted the s.ite from public park to a civic amenity. Copy of the order is extracted below: "Subject: Grant of land to Bangalore Medical Trust for \ construction of a Nursing Home. ORDER NO. HMA249MNG76DATEDBANGA­ LORE THE 27TH MAY 1976. READ; Letter No. PS 56/7-0-77 dated 21.4.1976 from the Chairman, Bangalore Developinent Authority, Bangalore. PREAMBLE; The Chairman, Bangalore Development Authority r MEDICAL TRUST v. B.S. MUDDAPPA (SAHA!, J.] 137 has requested for sanction of Government to the conver­ sion of the low level park, next to the land allotted to the HKE Society, in Rajmahal Vilas Extension as a C.A. Site and to the allotment of the said site to the Bangalore Me<li­ cal Trust for the construction of a Nursing Home. ORDER Sanction is accorded to the conversion of the Low Level Park, situated next to the land allotted to the H.K.E. Society in Rajmahal Vilas Extension, Bangalore as a civic amenity site. By order and in the name of the Governor of Karnataka sd/- . (S.R. Shankaranarayana Rao I/c. Under Secretary to Government Health & Municipal Admn. Deptt." D It was followed by another order dated 17th June, 1976, sanc­ tioning the lease to the BMT. The order reads as under: "Subject: Allotment of a C.A. site to Bangalore Medical Trust for Construction of a hospital. E ORDER NO. HMA 249 MNG 76, BANGALORE DATED THE 17THJUNE, 1976 . READ; (1) Govt. Order No. PLM 18 MNG 64 dated 17th March, 1964. PREAMBLE; 2) Govt. Order No. HMA 249 MNG 76 dated 27th May, 1976. 3) Letter No. PS 132/76-77 dated 1st June, 1976 from the Chairman, Bangalore Deve­ lopment Authority, Bangalore. 138 Sanction was accorded to convert a low level park situated next to the land allotted to H.K.E. Society in Rajmahal Vilas Extension, Bangalore vide Govt. Order read at (ii) above. Now the Chairman, Bangalore Developrr.wt Authority requests for lease of the aforesaid Civic Amenity Site to the Bangalore Medical Trust, Bangalore. ORDER Sanction is accorded to the lease of Civic Amenity Site situated next to the land allotted to HKE Society in Rajmahal Vilas Extension Bangalore to the Bangalore Medical Trust for construction of hospital with conditions of lease as detailed in the Govt. Order No. PLM 18 MNG 64, dated 17th March, 1964. The trust should strictly adhere to the condition no. 7 of the lease and should complete the building well within 3 years. By Order and in the name of Governor of Karnataka sd- (K.G. Rajanna) Under Secretary to Government Health & Municipal Admn. Deptt." On 14th July the Bangalore Development Authority (hheinafter F referred as BOA) completed the formality by passing the resolution and allotting the site to the BMT. The resolution reads as under: "The Government Order No. HMA 249 MNG 76 Banga­ lore dated the 17th June 1976 regarding allotment of C.A. Site situated next to the land allotted to H.K.E. Society in G Rajmahal Vilas Extension, Bangalore in favour of Banga­ lore Medical Trust for construction of hospital be read and recorded with confirmation for further action in the matter .. " On coming to know of the allotment in 1981, when some con­ H struction activity was noticed by the residents, they approached the MEDICAL TRUST v. B.S. MUDDAPPA (SAHA!, J.l 139 High Court by way of writ petition on which the learned single Judge framed two issues: "( 1) Whether the land had become the property of the Corporation and therefore the allotment of land by the BO A· in favour of the fourth respondent was illegal and invalid? (2) Even assuming that the ownership of the land had not been transferred to the Corporation, whether the action of the BOA in allotting the land, originally earmarked for a park, for construction of a nursing home and a hospital, io the fourth respondent is illegal and invalid? Both the issues were answered in the negative. On the first it was held that even though building and street etc. were transferred to the Corporation by the State Govt. by a notification issued under Section 23( 1) of the Act no such notification under Sub-Section (2) of Section 23 was issued in respect of open space etc. therefore the site reserved D for public park did not vest in the Corporation and it continued with the BOA which could deal with it. The finding was affirmed by the Division Bench as well. Its correctness was not assailed by the respon­ dents, in this Court. As regards the second question the learned Judge while agreeing with the Division Bench in Holy Saint Education Society v. Venkataamana, !LR 1982 1 Karnataka P. l. that 'a site E reserved for children's playground under the scheme prepared under the City Improvement Act when came to be vested in the Corporation, it was under a duty to retain it as such and it had no authority to divert it for any other use or grant it to a private person or organisation; held that the ratio was not helpful as, 'both under the provisions of the City Improvement Act and the BOA Act, the CIT or the BOA, as the case F may be, had the authority to improve the scheme by making alteration in the scheme and in exercise of the said power, the purpose for which any space was reserved, could be changed and after such change is effected the land could be disposed of for the purpose for which it is earmarked after such change.' The Judge held that since the site reserved for public park was converted under order of the Govern- G mcnt it was not possible to hold that the land in que3tion was reserved for a park. It was further held, that, 'since only notification allotting the site was challenged and not the conversion of site from public park to private nursing home and once the scheme was altered and the area rese~·ved for park was converted to be an area reserved for civic amenity the contention of the petitioners that the BOA had allotted i-1 - - 140 SUPREME COURT REPORTS [1991) 3 S.C.13'. the site for a purpose other than to which the land was reserved, had no basis at all for the fact that after alteration brought about by Government under order dated 27th March, 1976, the site in question was only reserved for a civic amenity generally and not for a part specially.' Two other subsidiary submissions which in fact are now the principal issues, "that the BDA had no power to alter the scheme', and in any event a site reserved for a civic amenity could not have been allotted for construction of a hospital" also did not find favour as the scheme could be altered under Section 19( 4) of the Act and it was done with approval of State Govt. In appeal the Division Bench after examining inclusive definition of civic amenity in Section 2(bb), added in 1984, amended with retrospective effect in 1983 held that a hospital could not be considered to be an amenity in 1976 as, "public amenity civic or otherwise to be a public convenience for purposes of the BDA Act, the Government has to notify. If it does not specify whatever may otherwise be a public convenience will not be a civic amenity or amenity under clauses (bb) and (b) of Section 2 respectively for purposes of the BD Act. "The Bench further held that in allowing the site to the BMT largess was conferred on it in utter violation of law and rules. Did the Division Bench commit any error of law? Was the con- E version of site in accordance with law? Were any of the authorities aware or apprised of the provisions under which they could convert a site reserved for public park into a nursing home? Did the authorities care to ascertain the provisions of law or rules under which they could act? Was any precaution taken by the Chief Executive of the State to adhere to legislative requirement of. altering any scheme. Not in the F least. The direction of the Chief Minister, the apex public functio­ nary of the State, was in breach of public trust, more like a person dealing with his private property than discharging his obligation as head of the State administration in accordance with !aw and rules. The Govt. record depicted even more distressing picture. The role of the administration was highly disappointing. In their noting even a G show of awareness of law and fact was missing. This culture of public functionary, adorning highest office in the State of being law to himself and the administration acting on dictate, for whatever reason disturbs the balance of rule of law. What is more shocking is that this happened in 1976 and not even one out of various departments from which the papers were routed through raised any objection. And the statutory H body like BDA with impressive members too succumbed under the pressure without, even, a murmur. .-.. , __ MEDICAL TRUST v. B.S. MUDDAPPA [SAHA!, J.l 141 -.. Financial gain by a local authority at the cost of public welfare A has never been considered as legitimate purpose even if the objective is laudable. Sadly the law was thrown to winds for a private purpose. ~ the extract of the Chief Minister's order quoted in the letter of Chairman of the BD A leaves no doubt that the end result having been decided by the highest executive in the State the lower in order of hierarchy only followed with 'ifs' and 'buts' ending finally with resolu- B ti on of BD A which was more or less a formality. Between 21st April and 14th July, 1976, that is less than ninety days, the machinery in BDA and Government moved so swiftly that the initiation of the pro- posal, by the appellant a rich trust with 90,000 dollars in foreign r deposits, query on it by the Chief Minister of the State, guidance of way out by the Chairman, direction on it by the Chief Minister, orders c of Govt. resolution by the BDA and allotment were all completed and the site for public park stood converted into site for private nursing home without any intimation direct or indirect to those who were being deprived of it. Speedy or quick action in public institutions cal~ for appreciation but our democratic system shuns exercis~ of individua- lised discretion in public matters requiring participatory decision. by D rules and regulations. No one howsoever high can arrogate to himself ~ or assume without any authorisation express or implied in law a discre- ~. tion to ignore the rules and deviate from rationality by adopting a strained or distorted interpretation as it renders the action ultra vires and bad in law. When the law requires an authority to act or decide, 'if it appears to it necessary" or if he is 'of opinion that a particular act E should be done' then it is implicit that it should be done objectively, fairly and reasonably. Decisions affecting public interest or the neces- sity of doing it in the light of guidance provided by the Act and rules ··./ may not require intimation to person affected yet the exercise of dis- cretion is vitiated if the action is bereft of rationality lacks objective and purposive approach. The action or decision must not only be F reached reasonably and intelligibly but it must be related to the purpose for which power is exercised. The purpose for which the Act was enacted is spelt out from the Preamble itself which provides for establishment of the Authority for development of the city of Banga- lore and areas adjacent thereto. To carry out this purpose the develop- ment scheme framed by the Improvement Trust was adopted by the G ,)_ Development Authority. Any alteration in this scheme could have been made as.provided in Sub-Section (4) of Section 19 only if it resulted in improvement in any part of the scheme. As stated earlier a private Nursing Home could neither be considered to be an amenity nor it could be considered improvement over necessity like a public park. The exercise of power, therefore, was contrary to the purpose H 142 SUPREME COURT REPORTS (1991) 3 S.C.R. .. A for which it is conferred under the statute. Was the exercise of discretion under Sub-Section (4)-0f Section 19 in violation or in accordance with the norm provided in law. For ~ proper appreciation the Sub-Section is extracted below: B "(4) If at any time it appears to the Authority that an improvement can be made in any part of the scheme, the Authority may alter the scheme· for the said purpose and shall subject to the provisions of sub-section (5) and (6) forthwith proceed to execute the scheme as altered." c This legislative mandate enables the Authority to alter any scheme. Existence of power is thus clearly provided for. What is the nature of this power and the manner of its exercise? It is obviously statutory in character. The legislature took care to control the exercise of this power by linking it with improvement in the scheme. What is an improvement or when any change in the scheme can be said to be D improvement is a matter of discretion by the authority empowered to exercise the power. In modern State activity discretion with executive and administrative agency is a must for efficient and smooth function- ~ ing. But the extent of discretion.or constraints on its exercise depen~s· .i on the rules and regulations under which it is exercised. Sub-Section (4) of Section 19 not only defines the scope and lays down the ambit E within which the discretion could be exercised but it envisages further- the manner in which it could be exercised. Therefore, any action or exercise of discretion to alter the scheme must habe been backed by substantive rationality flowing from the. Section. Public interest or general good or social betterment have no doubt priority over private )-' or individual interest but it must not be a preiext to justify the f arbitrary or illegal exercise of power. It must withstand scrutiny of the legislative standard provided by the Statute itself. The authority exer- cising discretion must not appear to be, impervious to legislative direc- tions. From the extracts of correspondence between the Chairman and the Chief Minister it is apparent that neither of them cared to look into the provisions of law. It was left to the learned Advocate General to G defend it, as a matter of law, in the High Court. There is no whisper anywhere if it was ever considered, objectively, by any authority that the nursing home would amount to an improvement. Whether the decision would have been 'correct or not would have given rise to different consicleraiion. But.here it was total absence of any effect to do so. Even in the reply filed on behalf of BDA in the High Court tt which appears more a Iega_~juggI:ry than stateme~t of facts bristling ~ ' l t MEDICAL TRUST v. B.S. MUDDAPPA [SAHAI, J.] 143 with factual inaccuracies there is no mention of it. The extent of mis­ leading averments for purpose of creating erroneous impressions on the Court shall be clear from the statement contained in paragraph 1 of the affidavit relevant portion of which is extracted below: "The fourth respondent had made an application for grant of land for purpose of constructing a Nursing Home. This application was made also to this Respondent. Considering the fact that the medical facilities available in Bangalore were meagre and were required to be supplemented by charitable medical institutions, this authority was required to ascertain whether a suitable site could be given for the hospital building of the fourth ·respondent. Upon scrutiny of the Rajmahal Vilas Extension, as early as in 1976, the area in question which had been marked as a low level park measuring 13485 sq. yards was found suitable to ·cater to the medical relief to the needy public. However, since the said area had been marked as a low level park, it was neces­ sary to convert the said low level park as civic amenity site. Furthermore, it is essential that the Government had to approve allotment of the site to the fourth respondent as a civic amenity site. There are proceedings before the first respondent in relation to allotment of site to public institu­ tions. Under the recommendations which has been made, it was decided that plots could be allotted to public institu-. J:l tions subject to certain conditions." It was this statement which resulted in erroneous finding by the learned single Judge to the effect. "Therefore, it is clear that though at the time of preparation of the scheme, formation of a park was con­ sidered in the interest of the general public, nothing prevents the BO A · F · from taking. the view that the construction of a hospital to provide medical facilities to the general·public is necessary and therefore, the area earmarked for park should be converted into a civic amenity site. It is in exercise of this power, the BOA decided to convert the area. reserved for park into a civic amenity site so as to enable its disposal in favour of the fourth respondent for construction of a hospital. Though G Section 19( 4) does not expressly require the taking of the approval of the Government for such alteration, the approval was necessary as the original scheme in which the area was reserved for a park had been. approved by the Government. Therefore, the BDA considered appropriate, and in my opinion rightly, to seek the approval of the Government for making such conversion:· The State. Government !'I ' . 144 SUPREME COURT REPORTS I 1991] 3 S.C.R. accorded sanction for the conversion. Therefore, the conversion was in accordance with law". The averment in the affidavit of the BOA that an application was made before it could not be substantiated. Nor it could be established that the BOA or any of its committee ever took into consideration that medical facilities were meagre in the city of Bangalore. Such misleading statements call for serious condemnation. No further comment is needed except that the public institutions should be cautious and must not give impression of taking sides. It is destructive of fairness. The then Chairman's letter in 1976 extracted above was forthright whereas the stand of BOA in 1983 appears to be crude effort to support the executive action. No record was produced to substantiate· the averments. It was necessary as it was not in harmony with the correspondence extracted earlier. The statement by the counsel for the BOA that the records were not traceable was not satisfactory. The executive or the administrative authority must not be oblivious that in a democratic set up the people or community being sovereign the exercise of disceretion must be guided by the inherent philosophy that the exercisor of discretion is accountable for his aetion. It is to be tested on anvil of rule of law and fairness or justice particularly if competing interest of members of society is involved. Was this adhered to by any of the authority? Unfortunately not. Much was attempted to be made out of exercise of discretion in converting a site reserved for amenity as a civic amenity. Discretion is an effective tool in administration. But wrong notions about it results in ill-cmiceived consequences. In law it provides an option to the authority concerned to adopt one or the other alternative. But a bet­ ter, proper and legal exercise of discretion is one where the authority examines the fact, is aware of law and then decides objectively and rationally what serves the interest better. When a Statute either pro­ vides guidance or rules or regulations are framed for exercise of discre­ tion then the action should be in accordance with it. Even where Statutes are silent and only power is conferred to act in one or the other manner, the Authority cannot act whimsically or arbitrarily. It should be guided by reasonableness and fairness. The legislature never intends its authorities to abuse the law or use it unfairly. When legisla- G tu re enacted Sub-section ( 4) it unequivocally declared its intention of making any alteration in the scheme by the Authority, that is, BOA and not the State yovernment. It further permitted interference with the scheme sanctioned by it only if appeared to be improvement. The facts, therefore, that were to be found by the Authority were that the conversion of public park into private nursing home would be an H improvement in the scheme. Neither the Authority nor the State -~ MEDICAL TRUST v. B.S. MUDDAPPA (SAHA!, J.] 145 Government undertook any such exercise. Power of conversion or alteration in scheme was taken for granted. Amenity was defined in Section 2(b) of the Act to include road, street, lighting, drainage, public works and such other conveniences as the Government may, by notification, specify to be an amenity for the purposes of this Act. The Division Bench found that before any other facility could be consi­ dered amenity it was necessary for State Government to issue a notifi­ cation. And since no notification was issued including private nursing home as amenity it could not be deemed to be included in it. That apart the definition indicates that the convenience or facility should have had public characteristic. Even if it is assumed that the definition of amenity being inclusive it should,be given a wider meaning so as to include hospital added in clause 2(bb) as a civic amenity with effect from 1984 a private nursing home unlike a hospital run by Govt. or local authority did not satisfy that characteristic which ·was necessary in the absence of which it could not be held to be amenity or civic amenity. In any case a private nursing home could not be considered to be an improvement in the scheme and, therefore, the power under Section 19(4) could not have been exercised. Manner in which power was exercised fell below1.'. even the minimum requirement of taking action on relevant considerations. A scheme could be altered by the Authority as defined under Section 3 of the Act. It is a body corporate under Section 3 consisting of the Chairman and experts on various aspects, namely, a finance member, E an engineer, a town planner, an architect, the ex-officio members such as Commissioner of Corporation of the City of Bangalore. officer of the Secretariat and elected members for instance, two persons of the State Legislature, one a woman and other a Scheduled caste and Scheduled tribe member, representative of labour, representative of water-supply, sewerage board, electricity board, State Road Transport F Corporation, two elected counsillors etc. and the Commissioner. This authority functions through committees and meetings as provided under Sections 8 and 9. There is no Section either in the Act nor any rule was placed to demonstrate that the Chairman alone, as such, could exercise the power of the Authority. There is no whisper nor there is any record to establish that any meeting of the Authority was G held regarding alteration of the scheme. In any case the power does not vest in the State Government or the Chief Minister of the State. The exercise of power is further hedged by use of the expression, if 'it appears to the Authority'. In legal terminology it visualises prior con­ sideration and objective decision. And all this must have resulted in conclusion that the alteration would have been improvement. Not H eYen one was followed. The Chairman could not have acted on his own. Yet without calling any meeting of the authority or any commit- tee he sent the letter for converting the site. How did it appear to him that it was necessary, is mentioned in the letter dated 21st April, because the Chief Minister desired so. The purpose of the Authority taking such a decision is their knowledge of local conditions and what B was better for them. That is why participatory exercise is contemlated. If any alteration in Scheme couid be done by the Chairman and the Chief Minister then Sub-Section (4) of Section 19 is rendered otiose. There is Iio provision in the Act for alteration in a scheme by convert­ ing one site to another, except, of course if it appeared to be improve­ ment. But even that power vested in the Authority not the Govern­ ment. What should have happened was that the Authority should have C applied its mind and must have come to the conclusion that conversion of the site reserved for public park into a private nursing home amounted to an improvement then only it could have exercised the power. But what happened in fact was that the application for allot­ ment of the site was accepted first and the procedural requirements D were attempted to be gone through later and that too by the State Govt. which was not authorised to do so. Not only that the Authority did not apply its mind and take any decision if there was any necessity to alter the Scheme but even if it is assumed that the State Govt. could have any role to play, the entire exercise instead of proceeding from below, that is, from the BOA to State Government proceeded in E reverse direction, that, from the State Government to the BOA. Every order, namely, convertiPg the site from public park to private nursing home and even allotment to BMT was passed by State Government and the BOA acting like a true subservient body obeyed faithfully by adopting and confirming the directions. It was complete abdication of power by the BOA. The Legislature entrusted the responsibility to F alter and approve the Scheme to the BOA but the BOA in complete breach of faith reposed in it, preferred to take directions issued on Command of the Chief Executive of the State. This resulted not only in error or law but much beyond it. In fact the only role which the State Government could play in a scheme altered by the BOA is specified in Sub-Section (5) and (6) of Section 19 of the Act. The former requires G previous sanction of the Govt. if the estimated cost of executing the altered scheme exceeds by a greater sum than five per ceat of the cost of executing the scheme as sanctioned. And later if the 'scheme as altered involved the acquisition otherwise than by agreement'. In other words the State Government could be concerned or involved with an altered scheme either because of financial considerations or H when additional land was to be acquired, an exercise which could not ,. ... MEDiCAL TRUST v. B.S. MUDDAPPA [SAHA!, J.J 147 be undertaken by the BOA. A development scheme, therefore, sane- A tioned and published in the Gazette could not be altered by the Government. Effort was made to justify the exercise of power under Sub­ Section (3) of Section 15 which reads as under: "(3) Notwithstanding anything in this Act or in any other law for the time being in force, the Government may, whenever it deems it necessary require the Authority to take up any development scheme or work and execute it subject to such terms and conditions as may be specified by the Government." In Sub-Section (1) the Authority is empowered to draw up development scheme with approval of government whereas under Sub-Section (2) it is entitled to proceed on its owil provided it has funds and resources. Sub-Section (3) is the power of State Government to direct it to take up any scheme. The main thrust of the Sub-Section is to keep a vigil on the local body. But it cannot be stretched to entitle the Government to alter any scheme or convert any site or power specifically reserved in the Statute in the Authority. The general power of direction to take up development scheme cannot be con­ strued as superseding specific power conferred and provided for under Section 19(4). The Authority under Section 3 functions as a body. The Act does not contemplate individual action. That is participatory exer­ cise of powers by different persons representing different interest. And rightly as it is the local persons who can properly assess the need and necessity for altering a scheme and if any proposal to convert from one use to another was an improvement for residents of locality such as exercise could not be undertaken by the Government. Absence of power apart, such exercise is fraught with danger of being activated by extraneous considerations. Section 65 the overall power reserved in Government to give such directions to the Authority as it considers expedient for carrying out any purpose of the Act was another provision relied to support an order which is otherwise unsupportable. An exercise of power which is ultra vires the provisions in the Statute cannot be attempted to be resuscitated on general powers reserved in a Statute for its proper and effective implementation. The Section authorises the Government to issue directions to ensure that the provisions of law are obeyed and not to empower it itself to proceed contrary to law. What is not permitted t , r by the Act to be done by the Authority cannot be assumed to be done by State Government to render it legal. An illegality cannot be cured only because it was undertaken by the Government. The Section authorises the Government to issue directions to carry out purposes of the Act. That is the legislative mandate should be carried out. And not that the provision of law can be disregarded and ignored because what was done was being done by State Government and not the Authority. An illegality or any action contrary to law does not become in accor­ dance with law because it is done at the behest of the Chief Executive of the State. No one is above law. In a democracy what prevails is law and rule and not the height of the person exercising the power. ..- C For these reasons the entire proceedings before the State Government suffered from absence of jurisdiction. Even the exercise of power was vitiated and ultra vires. Therefore the orders of the· Government to convert the site reserved for public park to civic ame­ nity and to allot it for private nursing home to Bangalore Medical D Trust and the resolution of the Bangalore Development Authority in compliance of it were null, void and without jurisdiction. Leave granted. ORDER In the result this appeal fails, for the reasons stated by us in our separate but concurring judgments, and is accordingly dismissed. We further direct that the respondents shall be entitled to their cost throughout. N.P.V. Appeal dismissed.