The State of Telangana & Ors. v. Dr. Pasupuleti Nirmala Hanumantha Rao Charitable Trust
Judgment
Manmohan, J.
1. Present Appeal has been filed challenging the impugned judgment
and final order dated 05 th July, 2022 passed by the High Court for
the State of Telangana at Hyderabad in Writ Appeal No.1328 of
2014, whereby the High Court dismissed the Writ Appeal filed by
the Appellants herein and upheld the judgment and order dated 24th
June, 2014 passed in W.P.(C) 28980/2013 passed by the learned
Single Judge. It is pertinent to mention that both the Courts below
held that the Respondent-Trust is the absolute owner of the land to
the extent of Ac.3.01 gts.in Sy. No.72/31 situated at Chinnathimmapur
village, Mulugu Mandal, Medak District, as the Appellant-State
having sold the land on payment of market value could not have
placed any condition restricting the enjoyment of the land and such
restrictions were void under Section 10 of the Transfer of Property
Act, 1882 (hereinafter referred to as ‘TPA’). The relevant portion of
the impugned order passed by the Division Bench is reproduced
hereinbelow: -
“7. Thus, learned Single Judge noted that respondent had
purchased the subject land on payment of market value
from the Government. On such purchase, respondent
became the owner of the subject land whereafter, the
same ceased to be a Government land or an assignable
land. Having sold the land on payment of market value,
the Government could not have placed any condition
restricting the enjoyment of the land by the land owner.
The State of Telangana & Ors. v.
Dr. Pasupuleti Nirmala Hanumantha Rao Charitable Trust
8. We do not find any error or infirmity in the view taken
by the learned Single Judge. No case for interference is
made out.”
ARGUMENTS ON BEHALF OF APPELLANT
2. Mr. S. Niranjan Reddy, learned senior counsel for the Appellant-
State, submitted that the impugned judgments of the High Court
were untenable in law, inasmuch as, they did not consider the
statutory scheme under which the Appellant-State had allotted land
to the Respondent-Trust. He pointed out that under Section 25 of
Telangana Land Revenue Act (hereinafter referred to as ‘Act’), the
Commissioner/Collector can assign/set apart any land for the purpose
of public benefit. He stated that to facilitate alienation of land, the
State of Telangana has framed Telangana Alienation of State Lands
and Land Revenue Rules 1975 (for short ‘Rules 1975’) under Section
172 of the Act. The relevant portion of Rules 5 and 6 of the said
Rules 1975 are reproduced herein below: -
“5. (a) For every alienation of land requiring the sanction of
the Board of Revenue or the State Government there shall
be made an application by the Collector in the prescribed
in Appendix I to these rules…….
6.(a) Every grant of Alienation of State land whether for
religious Educational or any other public purpose always
be subject to the following conditions:-
(1) The land shall be used …………..and for no other
purpose.
(2) The Government may resume the land wholly or in
part with any buildings thereon, in the event of the
infringement of any of the conditions of the grant. In
the event of such resumption, no compensation shall
be payable for any improvements that may have been
effected, or other works that may have been executed
on the land by the grantee and the grantee shall not
be entitled to the repayment of any amount that may
have been paid to the Government for the grant. If
there are buildings on the land the Government may
direct the grantee to remove them.”
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3. He further stated that G.O.Ms. No.635 dated 02nd July, 1990 empowers
the Commissioner, Land Revenue/ District Collectors to dispense
Government lands by alienation on payment of market value. The
relevant portion of the aforesaid G.O.Ms. is reproduced hereinbelow: -
“REVENUE DEPARTMENT
G.O.Ms. No.635 Dated 2-7-1990
1. G.O.Ms. No.73, Revenue dated 20.01.1975.
2. From the Commissioner of land Revenue, Hyderabad
D.G. Letter No.B1/653/90, dated 27.02.1990.
ORDER:-
The Andhra Pradesh (Telangana Area) Alienation of
State lands and land Revenue Rules 1975, empower the
Commissioner, Land Revenue land the District Collectors
to dispense of Government lands by alienation to local
Mediums and private institutions, Companies, Associations
and private individuals on payment of market value. Illegible
within certain limitations. Similar provisions is also available
in B.S.O. 24 (empowering the Commissioner, land Revenue
and District Collectors to dispose of Government land by
alienation…..”
4. The relevant portion of the Board Standing Order 24 referred to in
G.O.Ms. No.635 is reproduced hereinbelow:-
“6. Condition for the grant of State land:- (i) Lands
at the disposal of Government:- A grant of State land
whether for religious, educational or other public purpose
should always contain the following conditions:-
(1) The land shall be used ………………….and for
no other purpose.
(2) The Government may resume the land wholly or
in part with any buildings thereon, in the event
of the infringement of any of the conditions
of the grant. In the event of such resumption
no compensation shall be payable for any
improvements that may have been effected, or
other works that may have been executed on
The State of Telangana & Ors. v.
Dr. Pasupuleti Nirmala Hanumantha Rao Charitable Trust
the land by the grantee and the grantee shall
not be entitled to the repayment of any amount
that may have been paid to the Government for
the grant. If there are buildings on the land the
Government may direct the grantee to remove
them…..”
5. He pointed out that in the present case, the District Collector, Medak
vide order dated 08th February 2001, had allotted the subject land in
exercise of the powers conferred under G.O.Ms. No. 635 (Revenue)
dated 2nd July 1990. He emphasised that the only document on which
the Respondent-Trust had relied upon to prove its title/ownership
was the allotment letter issued under a statutory Scheme and not
a sale deed.
6. He further stated that the allotment was made subject to certain
conditions, and it was specifically stated that any deviation from the
said conditions would result in the land being resumed back by the
revenue authorities.
7. He contended that in the present case, the Appellant-State was not
intending to sell the land but to allot the same to charitable trust for
a charitable purpose for the benefit of public at large.
8. Additionally, Mr. Reddy drew the attention of this Court to the General
Power of Attorney dated 18 th June 2011 (“GPA”) executed by the
Respondent-Trust, qua the subject land. He contended that the
Respondent-Trust had fraudulently executed a GPA without making
any reference to the allotment letter dated 08 th February, 2001 or
the conditions on which the allotment of said land had been made.
The relevant portion of GPA relied upon by him is reproduced
hereinbelow: -
“GENERAL POWER OF ATTORNEY
KNOWN ALL MEN BY THE PRESENTS, THAT I Dr. P.
HANUMANTH RAO S/O Dr. P. RAMA RAO, aged about
66 years…….
DO HEREBY NOMINATE, CONSTITUTE, APPOINT AND
RETAIN
SYED JAVED…….AS MY TRUE AND LAWFUL
ATTORNEY…..
8 [2025] 7 S.C.R.
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WHEREAS I am the lawful owner, Pottedar and possessor
of Agricultural Land bearing Sy.No.72/31, admeasuring
Ac.3-01 Gts……having acquired the same from Smt. S.
SHREE SUDHA W/O SRI SANGARAJU MANOHAR RAJU
through a Regd. Sale Deed Vide Document No.859/1988,
Dt: 09-03-1938 Regd. at SRO Gajwel, Medak District.
Thereafter the Revenue officials have issued the Title
Deed and Pattedar Passbooks vide title deed No.674409
and the Patta No.143 respectively.
WHEREAS, the said Smt. S. SHREE SUDHA W/O SRI
SANGARAJU MANOHAR RAJU has purchased the said
property from Shri MURTHY MURRAY S/O Late S.S.
MURRAY through a Regd. Sale Deed vide Document
No.695/1981, Dt. 03-07.1981 Regd. at SRO Gajwel,
Medak District.
AND WHEREAS, I am intending to hand over the above
property agricultural land bearing Sy.No. 72/31 an extend
of Ac.3-01 gts., situated at CHINNA THIMMAPUR Village,
Mulugu Mandal, Siddipet Revenue Division, Medak District
A.P. (hereinafter called the SCHEDULE OF PROPERTY)
which is more fully described in the schedule of property
but due to personal work I am not looking after the affairs
of the said property personally as such I am not in position
to deal with the intending purchase, as such I hereby
empower and authorize my Attorney Mr. SYED JAVED
S/o late S.G. MOHIUDDIN to deal with all the matters
contained to him with the following powers……”
9. Mr. Reddy lastly stated that the Power of Attorney holder had cut
a colony by the name ‘Eden Orchard’ on the land allotted to the
Respondent-Trust and even some of the plots had been sold to
third parties without disclosing the conditions on which the initial
allotment had been made.
ARGUMENTS ON BEHALF OF RESPONDENT
10. Per contra, Mr. Gaurav Agrawal, learned senior counsel for the
Respondent-Trust contended that the subject land was sold by the
State Government after following the due procedure stipulated in
G.O.Ms. No. 635 dated 02nd July, 1990, wherein the District Collector,
Medak in consultation with the Commissioner of Land Revenue sold
The State of Telangana & Ors. v.
Dr. Pasupuleti Nirmala Hanumantha Rao Charitable Trust
the land to the Respondent-Trust on payment of market value. He
emphasised that the said sale was made at market value and the
same was not an allotment at any concessional rate.
11. He further stated that the said alienation contained a general condition
that “the land would be utilised only for the purpose for which it is
allotted” without actually specifying the exact purpose for the allotment.
Therefore, he submitted that there was no restriction/condition
imposed on the usage of the land by the Respondent-Trust herein
and in any event, any such condition on usage would be violative
of Section 10 of the TPA – as held by the High Court. Since Section
10 of the TPA was heavily relied upon by learned senior counsel
for the Respondent-Trust, the same is reproduced herein below:-
“10. Condition restraining alienation.—Where property
is transferred subject to a condition or limitation absolutely
restraining the transferee or any person claiming under him
from parting with or disposing of his interest in the property,
the condition or limitation is void, except in the case of a
lease where the condition is for the benefit of the lessor
or those claiming under him: provided that property may
be transferred to or for the benefit of a woman (not being
a Hindu, Muhammadan or Buddhist), so that she shall not
have power during her marriage to transfer or charge the
same or her beneficial interest therein.”
12. He further submitted that the resumption order dated 19 th January
2012 was passed in violation of the principle of natural justice. He,
however, stated that the said aspect was not considered by the
learned Single Judge and the Division Bench, and therefore, if this
Court was inclined to set aside the impugned orders, it should remand
the matter back to the High Court for fresh adjudication on merits.
REJOINDER
13. In rejoinder, learned senior counsel for the Appellant-State submitted
that Section 10 of the TPA operates in a completely different sphere
as it applies in a case of inter vivos transfer, whereas allotment by
the Appellant-State is different from a private party engaging in inter
vivos transfers. He contended that the learned Single Judge and the
Division Bench had erred in not making a distinction between sale
and allotment of the subject land.
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ISSUES
14. Having heard learned counsel for the parties and having perused the
paper book, this Court is of the view that the following issues arise
for consideration in the present proceedings, namely: -
i. Whether alienation of land by the District Collector, Medak,
Government of Andhra Pradesh vide order dated 8 th February
2001 was a sale or alienation/allotment?
ii. Whether any condition was imposed pursuant to the alienation
of land by the Government of Andhra Pradesh? and
iii. Whether any condition/restriction imposed by the State
Government would be violative of Section 10 of the TPA?
REASONING
ALIENATION OF LAND BY APPELLANT-STATE WAS NOT A SALE
BUT AN ALLOTMENT UNDER A STATUTORY SCHEME
15. Before answering the aforesaid issues, this Court is of the view that
it is essential to outline the relevant facts. The land in question to the
extent of Ac. 3.01 gts., falls under Sy. No.72/31 and is Government
land as per entries of record and was declared as Government
(Poramboke) land in the year 1989.
16. Further, the Respondent, being a charitable trust, had applied for
allotment of land. A charitable trust can use land for charitable
purposes only.
17. The request of the Respondent-Trust was processed as per the
instructions laid down in G.O.Ms. No.635 dated 02 nd July, 1990
and the land in question was conditionally allotted by the District
Collector, Medak, Government of Andhra Pradesh vide order dated 8th
February 2001 by virtue of the power conferred under the Telangana
Alienation of State Lands and Land Revenue Rules, 1975 framed
under Sections 25 and 172 of the Act and G.O.Ms.No.635 dated
2nd July 1990 read with Board Standing Order 24. The said fact is
apparent from the alienation letter dated 8th February 2001 issued by
the District Collector, Medak, which specifically records that sanction
is accorded to alienation of Government land subject to payment of
market value and subject to the following three conditions. It was
made clear that in case of deviation of the said three conditions,
the land shall be resumed back by the Revenue authorities. The
The State of Telangana & Ors. v.
Dr. Pasupuleti Nirmala Hanumantha Rao Charitable Trust
relevant portion of the alienation order dated 08 th February 2001 is
reproduced hereinbelow:
“1. That the above land should be utilized only for the
purpose for which it is allotted.
2. That the construction work should be completed within
(2) years from the date of handing over possession of
the land.
3. That the trees should be planted in the open place.”
In case of any deviation of the above conditions the land
shall be resumed back by the Revenue authorities…. ”
18. Consequently, alienation of land by the District Collector, Medak,
Government of Andhra Pradesh vide order dated 8th February, 2001
was not a sale, but an allotment under a statutory Scheme.
THE ALLOTMENT OF LAND WAS CONDITIONAL TO THE
RESPONDENT-TRUST’S KNOWLEDGE
19. Though no specific purpose of allotment was mentioned, yet this Court
is of the view that as the allotment was in favour of the Respondent-
Trust, the allotment could be used for a charitable purpose only. Even
in the Respondent-Trust’s understanding, the allotment of land was
conditional. This would be apparent from the fact that not only in the
contemporaneous correspondence, but even in the writ petition filed,
there was an admission by the Respondent-Trust that the allotment
was made for a charitable purpose, and the land was being used
for the said purpose. In response to the Appellant’s letter dated 23rd
November 2011, the Respondent-Trust had specifically replied that
there were no violations of the conditions laid down in the letter dated
8th February 2001 and the land was being utilized for the purpose for
which it was allotted. The relevant portion of the Respondent-Trust’s
reply dated 29th November 2011 is reproduced herein below: -
“…I, further state that there are no such violations in
the conditions laid down in the District Collector Medak
Proceedings No.E3/7542/98, Dt.8.2.2001.
After taking the possession the above land is being utilized
for the purpose alienated. Class room, sheds were
constructed within two years through our own funds…”
(emphasis supplied)
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20. It was also specifically averred in the writ petition filed by the
Respondent-Trust that as the Appellant-State had offered the land as
per G.O.Ms. No.635 dated 2nd July 1990 subject to three conditions
vide proceedings No.E3/7542/98 dated 08 th February 2001, the
Respondent-Trust had followed the same ‘scrupulously’. Consequently,
the Respondent-Trust’s argument that no specific purpose of allotment
was specified is false to the Respondent-Trust’s knowledge.
HIGH COURT FELL IN ERROR IN MAKING OUT A CASE OF SALE
21. In fact, the case of the Respondent-Trust in its writ petition filed
before the learned Single Judge was not that it was a case of sale,
but it had been assured that, “the alienation of land is amounting to
sale…”. Consequently, this Court is of the view that the High Court
fell in error in making out a case of sale, ignoring the fact that the
Appellant-State had allotted land to the Respondent-Trust under a
statutory scheme of alienation/allotment.
22. This Court is further of the view that when the Government decides
to sell its land, as the Respondent-Trust would like this Court to
believe, the Government can neither select a buyer nor can it fix
a price unless and until the said decision is backed by a social or
economic or welfare policy/purpose – which is admittedly absent in the
present case. It is a settled law that the Government cannot distribute
State’s largesse and normally the State ‘must’ get the ‘maximum
value’ of the resources, especially when State-owned assets are
passed over to private individuals/entities unless there are good and
cogent reasons for doing so in special circumstances. [See: Ramana
Dayaram Shetty vs. The International Airport Authority of India
& Ors., 1979 (3) SCR 1014; Natural Resources Allocation, In Re,
Special Reference No.1 of 2012, (2012) 10 SCC 1 and Manohar
Lal Sharma vs. Principal Secretary & Ors., (2014) 9 SCC 516].
STATUTORY SCHEME OF ALLOTMENT NOT ECLIPSED BY
SECTION 10
23. This Court is of the view that the Appellant-State had allotted land
to public trust for public purpose. In such a situation, the State
cannot be put in the normal classical inter vivos party’s position as
public interest is supreme and must prevail. This Court is also of
The State of Telangana & Ors. v.
Dr. Pasupuleti Nirmala Hanumantha Rao Charitable Trust
the opinion that Rules 1975 and the Board of Revenue Standing
Orders operate in a completely distinct space and are not eclipsed
by Section 10 of the TPA.
GPA REFLECTS MALAFIDES OF THE RESPONDENT-TRUST
(ALLOTEE)
24. In any event, in 2011, Dr. Pasupuleti Niramala Hanumantha Rao,
without disclosing that he is a Trustee of the Respondent-Trust
to whom the land had been allotted by the State Government,
appointed Sri Syed Javed as G.P.A. holder under the Registration
Deed No.148/11 dated 18 th June 2011. It is pertinent to mention
that the conditions on which the allotment had been made by the
State Government were not mentioned/disclosed in the G.P.A. which
reflects malafides of the Respondent-Trust (allottee).
DECISION TO CUT A COLONY – A FRAUD ON STATUTE
25. This Court is further of the view that the Respondent-Trust, despite
having accepted the conditions of grant of alienation laid down under
Condition No.6 of the Andhra Pradesh Board Standing Orders, violated
these conditions as the said land was not used for the purpose for
which it was granted, i.e. for the purpose of a Charitable Trust. On the
contrary, a colony was cut on the said land, which was sub-divided
into plots, some of which have already been sold to third parties vide
different sale deeds in violation of the conditions of allotment. This
Court is of the opinion that the decision to cut a colony in violation
of the specific conditions on which land had been allotted cannot
be termed as anything else but fraud on the statute.
CONCLUSION
26. Keeping in view the aforesaid findings, the impugned judgments
dated 24 th June 2014 and 05 th July 2022 are set aside and the
Appeal, is accordingly allowed. Pending applications, if any, shall
stand disposed of.
Result of the case: Appeal allowed.
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