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Surendrakumar, Jabalpur Vs. Kumari Lilawati Violet Manorama Laxmanan, Jabalpur and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Petn. No. 271 of 1980
Judge
Reported inAIR1982MP49
ActsUrban Land (Ceiling and Regulation) Act, 1976 - Sections 2, 5(3), 10(1), (3), (4), 26, 27, 27(1) and (5)
AppellantSurendrakumar, Jabalpur
RespondentKumari Lilawati Violet Manorama Laxmanan, Jabalpur and ors.
Appellant AdvocateY.S. Dharmadhikari, Adv.
Respondent AdvocateV.R. Rao, Adv. and ;S.L. Saxena, Govt. Adv.
DispositionPetition dismissed
Cases ReferredBhirn Singhji v. Union of India
Excerpt:
- - and in case no option is exercised within this period, the owner becomes entitled to transfer the property to whomsoever he may like. whatever may be the position, when sale deed is not executed and price is not paid within this period because of laches of the government, we are clearly of opinion that if the delay is due to inaction of the owner in taking steps for completion of the sale deed, the option once exercised does not lapse and a sale deed executed even after three months from the date of the option remains valid. (2) where a notice given under subsection (1) is for the transfer of the land by way of sale, the competent authority shall have the first option to purchase such land on behalf of the state government at a price calculated in accordance with the provisions of.....orderg. p. singh, c.j. 1. plot no. 7/1 situated in south civil lines, jabalpur, with a bungalow and outhouses belongs to kum. lilawati, respondent no, 1 in this petition. the entire area of the plot is 38,115, sq. ft. the area on which the constructions stand is 5,422 sq. ft. the petitioner entered into an agreement with respondent no. 1 on 11th-september 1978 for purchase of 16,500 sq. ft. of land out of plot no. 7/1 including an area of 4,142 sq. ft. covered by the bungalow, garage and some outhouses for a consideration of rs. 50.000/-. the petitioner and respondent no. 1 both applied under section 27 of the urban land (ceiling and regulation) act, 1976 to the competent authority for permission for sale of the aforesaid property in accordance with the agreement dated 11th sep. 1978......
Judgment:
ORDER

G. P. Singh, C.J.

1. Plot No. 7/1 situated in South Civil Lines, Jabalpur, with a bungalow and outhouses belongs to Kum. Lilawati, respondent No, 1 in this petition. The entire area of the plot is 38,115, sq. ft. The area on which the constructions stand is 5,422 sq. ft. The petitioner entered into an agreement with Respondent No. 1 on 11th-September 1978 for purchase of 16,500 sq. ft. of land out of plot No. 7/1 including an area of 4,142 sq. ft. covered by the bungalow, garage and some outhouses for a consideration of Rs. 50.000/-. The petitioner and Respondent No. 1 both applied under Section 27 of the Urban Land (Ceiling and Regulation) Act, 1976 to the Competent Authority for permission for sale of the aforesaid property in accordance with the agreement dated 11th Sep. 1978. This application was made on 31st Oct. 1979. The Competent Authority on 29th Dec, 1979 exercised the option for purchase of the property on behalf of the State Government under Section 27(5)(a) of the Act. A sale deed in pursuance of this option was executed on 16th May 1980 on behalf of respondent No. 1 in favour of the State Government. The petitioner by this petition under Article 226 of the Constitution prays that the option exercised by the Competent Authority and the sale deed executed by Respondent No. 1 in favour of the Government be quashed. It is further prayed that the respondents be directed to executea sale deed in respect of the property in favour of the petitioner.

2. The first contention raised by the learned counsel for the petitioner is that the sale deed in favour of the State Government was ineffective as it was not executed within three months of the exercise of the option by the Competent Authority. Learned counsel in this connection relies upon the proviso to Section 27(5), which enacts, that where the Competent Authority exercises the option, the execution of the sale deed shall be completed and the payment of the purchase price shall be made within a period of three months from the date on which such option is exercised. A perusal of Section 27(5) goes to show that the option has to be exercised by the Competent Authority within sixty days from the date of receipt of the application for permission; and in case no option is exercised within this period, the owner becomes entitled to transfer the property to whomsoever he may like. The section thus in clear terms provides the consequence of not exercising the option within the period of sixty days. The consequence being that the option to purchase lapses after the expiry of this period. This section, however, nowhere provides as to what will happen when the option is exercised within sixty days from the date of receipt of the application for permission but no sale deed is executed within three months from the date of the option. Whatever may be the position, when sale deed is not executed and price is not paid within this period because of laches of the Government, we are clearly of opinion that if the delay is due to inaction of the owner in taking steps for completion of the sale deed, the option once exercised does not lapse and a sale deed executed even after three months from the date of the option remains valid. If the option which has been exercised and which confers on the State Government the right to purchase can be said to lapse even though the State Government has been throughout ready and willing to complete the sale within the statutory period of three months but the sale deed is not executed within this period because of inaction or negligence of the owner, it would be possible for the owner to bring about this result in every case whenever he wants not to sell the property to the Government. Such a construction will make Section 27(5) wholly ineffective to serve the purpose for which it was enacted, i.e. to give the Government preferential right to purchase. The facts relevant on this point are that respondent No. 1 resides at Bombay. In proceedings before the Competent Authority she was represented by Advocate Shri V.R. Rao. The State was ready and willing to pay the price and complete the sale before 28th March 1980. The intimation that the Government was prepared to complete the sale and to pay the price was given to Shri Rao on 28th March 1980. The sale deed could not be executed within three months from the date of exercise of the option i.e. on or before 28th March 1980 for the reason that the power of Attorney came late in favour of Shri Rao authorising him to execute the sale deed. Now the delay in the instant case was not because of any negligence or lapse or default on the part of the State Government. The delay was solely because of the inaction of Respondent No. 1 in either not coming personally to execute the sale deed or in not giving the power of attorney in favour of Shri Rao earlier to complete the sale within the period of three months. In the circumstances, the Government was not responsible for the delay in execution of the sale deed. There was thus no question of the option lapsing and the sale being void on this ground.

3. The next contention raised by the learned counsel for the petitioner is that the application under Section 27 for permission to sell the property was made under a mistake and that in fact no application lay to the competent Authority for that purpose in respect of the property which the petitioner agreed to purchase from respondent No. 1. It is submitted that the law became clear on this point only after the decision of the Supreme Court in Bhim Singhji v. Union of India AIR 1981 SC 234 was pronounced that Section 27 is partly invalid. It is further contended that as the application under Section 27 was not maintainable there was no right in the Competent Authority to exercise the option to purchase the property and the sale deed executed in favour of the State Government was void.

4. To appreciate the above contention raised by the learned counsel it is necessary to refer to certain provisions of the Act. The Urban Land Ceiling Act became applicable to Madhya Pradesh from 9th Sept. 1976 when the Madhya Pradesh Legislature passed the resolution adopting the Act under Article 252(1) of the Constn. Section 3 of the Act provides that except as otherwise provided in the Act, on and from the commencement of the Act, no person shall be entitled to hold any vacant land in excess of the ceiling limit in the territories to which the Act applies, The ceiling limit of vacant land for Jabalpur is 16,146 sq. ft. Vacant land is defined in Section 2(q) as follows:

'(q) 'Vacant land' means land, not being land mainly used for the purpose of agriculture, in an urban agglomeration, but does not include-

(i) land on which construction of a building is not permissible under the building regulations in force in the area in which such land is situated;

(ii) in an area where there are building regulations the land occupied by any building which has been constructed before or is being constructed on, the appointed day with the approval of the appropriate authority and the land appurtenant to such building; and

(iii) in an area where there are no building regulations, the land occupied by any building which has been constructed before, or is being constructed on, the appointed day and the land appurtenant to such building;' It is clear from the definition of vacant land that it does not include land mainly used for the purpose of agriculture in an urban agglomeration and does not also include land occupied by any building and land appurtenant thereto. The definition of 'land appurtenant' is given in Section 2(g) which reads as follows:

'(g) 'Land appurtenant.' in relation to any building, means;--

(i) in an area where there are building regulations, the minimum extent of land required under such regulations to be kept as open space for the enioy-ment of such building, which in no case shall exceed five hundred square metres; or

(ii) in an area where there are no building regulations, an extent of five hundred square metres contiguous to the land occupied by such building;and includes, in the case of any building constructed before the appointed day with a dwelling unit therein, an additional extent, not exceeding five hundred square metres of land, if any, contiguous to the minimum extent referred to in sub-clause (i) or the extent referred to in sub-clause (ii) as the case may be.'

Urban land and urbanisable land are defined in Sections 2(o) and 2(p) as under:

'(o) 'urban land' means-

(i) any land situated within the limits of an urban agglomeration and referred to as such in the master plan; or

(ii) in a case where there is no master plan, or where the master plan does not refer to any land as urban land, any land within the limits of an urban agglomeration and situated in any area included within the local limits of a municipality (by whatever name called), a notified area committee, a town area committee, a city and town committee, a small town committee, a cantonment board or a panchayat. but does not include any such land which is mainly used for the purpose of agriculture.

Explanation-- For the purpose of this clause and clause (q),--

(A) 'agriculture' includes horticulture, but does not include-

(i) raising of grass,

(ii) dairy farming,

(iii) poultry farming,

(iv) breeding of live-stock, and

(v) such cultivation or the growing of such plant, as may be prescribed;

(p) 'urbanisable land' means land situated within an urban agglomeration, but not being urban land.' Where a person holds vacant land and also holds any other land on which there is a building, the extent of the land occupied by the building and the land appurtenant thereto are taken into account in calculating the extent of vacant land, although the building or the appurtenant land cannot be declared as excess vacant land. The provisions to this effect are contained in sub-sections (9) and (H) of Section 4 which read as below:

'4. (9) Where a person holds vacant land and also holds any other land on which there is a building with a dwelling unit therein, the extent of such other land occupied by the building and land appurtenant thereto shall also be taken into account in calculating the extent of vacant land held by such person.

(11) For the removal of doubts it is hereby declared that nothing in subsections (5), (6), (7). (9) and (10) shall be construed as empowering the competent authority to declare any land referred to in sub-clause (ii) or sub-clause (iii) of clause (q) of Section 2 as excess vacant land under this Chapter.'

5. The scheme of the Act is that a person holding vacant land in excess of ceiling limit is required to file a statement under Section 6. After preparation of a draft statement regarding vacant land in excess of ceiling limit, objections are invited and a final statement is prepared under Section 9. Thereafter a notification is issued under Section 10(1) giving particulars of the vacant land in excess of ceiling limit. At any time after the publication of the notification under Section 10(1), the Government can declare that the excess vacant land shall be deemed to have been acquired by it. When a declaration to that effect is published the excess vacant land vests in the State Government. There are certain provisions in the Act which put fetter on the right of transfer. These provisions are contained in Sections 5(3), 10(4) and 27(1) of the Act. Section 26, which deals with persons holding vacant land within the ceiling limit, restricts the right to transfer only to the extent that a notice has to be given before sale to the competent authority and the State Government has the first option to purchase the vacant land. These provisions in so far as they are relevant read as follows:

'5. (31 In any State to which this Act applies in the first instance and in any State which adopts this Act under clause (1) of Article 252 of the Constitution, no person holding vacant land in excess of the ceiling limit immediately before th'e commencement of this Act shall transfer any such land or part thereof by way of sale, mortgage, gift, lease or otherwise until he has furnished a statement under Section 6 and a notification regarding the excess vacant land held by him has been published under sub-section (1) of Section 10; and any such transfer made in contravention of this provision shall be deemed to be null and void.

10. (4) During the period commencing on the date of publication of the notification under sub-sec. (1) and ending with the date specified in the declaration made under sub-section (3).

(i) no person shall transfer by way of sale, mortgage, gift, lease or otherwise ' any excess vacant land (including any part thereof) specified in the notification aforesaid and any such transfer made in contravention of this provision shall be deemed to be null and void; and

(ii) no person shall alter or cause to be altered the use of such excess vacant land.

26. (11 Notwithstanding anything contained in any other law for the time being in force, no person holding vacant land within the ceiling limit shall transfer such land by way of sale, mortgage, gift, lease or otherwise except after giving notice in writing of the intended transfer to the competent authority.

(2) Where a notice given under subsection (1) is for the transfer of the land by way of sale, the competent authority shall have the first option to purchase such land on behalf of the State Government at a price calculated in accordance with the provisions of the Land Acquisition Act, 1894, or of any other corresponding law for the time being in force and if such option is not exercised within a period of sixty days from the date of receipt of the notice, it shall be presumed that the competent authority has no intention to purchase such land on behalf of the State Government and it shall be lawful for such person to transfer the land to whomsover he may like;

Provided that where the competent authority exercises within the period aforesaid the option to purchase such land the execution of the sale deed shall be completed and the payment of the purchase price thereof shall be made within a period of three months from the date on which such option is exercised.

27. (1) Notwithstanding anything contained in any other law for the time being in force but subject to the provisions of sub-section (3) of Section 5 and sub-section (4) of Section 10. no person shall transfer by way of sale, mortgage, gift, lease for a period exceeding ten years, or otherwise, any urban orurbanisable land with a building (whether constructed before or after the commencement of this Act) or a portion only oi such building for a period of ten years of such commencement or from the date on which the building is constructed, whichever is later, except with the previous permission in writing of the competent authority.

27. (5) (a) Where the permission applied for is for the transfer of the land with the building or, as the case may be, a portion only of such building referred to in sub-section (1) by way of sale, and the competent authority is of the opinion that such permission may be granted, then, the competent authority shall have the first option to purchase such land with building or a portion only of such building on behalf of the State Government at such price as may be agreed upon between the competent authority and the applicant or, in a case where there is no such agreement, at such price calculated in accordance with the provisions of the Land Acquisition Act, 1894 or of any other corresponding law for the time being in force,

(b) If the option referred to in clause (a) is not exercised within a period of sixty days from the date of receipt of the application under this section, it shall be presumed that the competent authority has no intention to purchase such land with building or a portion only of such building on behalf of the State Government and it shall be lawful for such person to transfer the land to whomsoever he may' like:

Provided that where the competent authority exercises within the period aforesaid the option to purchase such land with building or a portion only of such building, the execution of the sale deed shall be completed and the payment of the purchase price thereof shall be made within a period of three months from the date on which such option is exercised.'

6. A perusal of the relevant provisions of the Act makes it abundantly clear that land occupied by a building and land appurtenant thereto as defined in Section 2(g) are untouched by the Ceiling Act. The ceiling limit is fixed for vacant land i. e. land which is not covered by buildings and is not appurtenant to buildings to the extent mentioned in Section 2. If a person holds vacant land in excess of ceiling limit, he cannot transfer such vacant land until he has furnished a statement under Section 6 and until a notification is published under Section 10(1)- This restriction is contained in Section 5(3). Bespondent No. 1, in the instant case, has not filed any statement under Section 6 so far and no notification has yet been issued under Section 10(1). The restriction contained in Section 5(3) is only in respect of vacant land which, according to the definition contained in Section 2(q), does not include land covered by buildings and appurtenant lands. After a notification is issued under Section 10(1) giving particulars of the excess vacant land held by a person, the restriction for transfer of the excess vacant land continues under Section 10(4) up to the date when by declaration made under Section 10(3) the excess vacant land is acquired by the State Government and becomes vested in it. However after the notification under Section 10(1) the restriction in respect of vacant land within the ceiling limit is lifted and the only restriction that continues is under Section 26. The holder of vacant land within the ceiling limit can transfer the same, but before doing so he has to give a notice to the competent Authority who has an option to purchase the same on behalf of the State Government. Neither Section 5(3) nor Section 10(4) nor Section 26 put any restriction on sale of land covered by a building land appurtenant thereto. These provisions deal only with vacant land; and as vacant land does not include land covered by a building and land appurtenant thereto, the restrictions conta;n-ed in them are not applicable to such lands. The only provision in the Act which restricts the right to sell buildings and appurtenant lands is contained in Section 27. Section 27(1) provides that no person shall transfer by way of sale, mortgage, gift, lease for a period exceeding 10 years, or otherwise, any urban or urbanisable land with a building (whether constructed before or after the commencement of the Act) or a portion only of such building for a period of ten years of such commencement or from the date on which the building jp constructed, whichever is later, except with the previous permission in writ'ng of the competent Authority. If an application is made under 6. 27 (41 for permission, the competent Authority has an option under Section 27(5) of purchasing the building and land on behalf of the State Government. Section 27(1) has expressly made 'subject to the provisions of sub-section (3) of Section 5 and sub-section (4) of Section 10'. This means that no permission can be applied for under Section 27(1) in respect of vacant land which cannot be sold under Section 5(3) or under Section 10(4) because these two provisions contain a complete ban on transfer during the period they are operative. As already seen Section 5(3) applies from the date of commencement of the Act until a notification is issued under Section 10(1) in respect of all vacant land; and Section 10(4) applies in respect of excess vacant land declared in the notification under Section 10(1) up to the date of the declaration and vesting of such land under Section 10(3). As regards a person holding vacant land within the ceiling limit, which will be the position in respect of every person after the declaration under Section 10(3), there is no ban on transfer. A person holding vacant land within the ceiling limit can always transfer it without obtaining any permission. All that he has to do is to give a notice under Section 26 to the competent Authority and the Government has got a right of first purchase. It will thus be seen that' vacant land as defined in the Act is completely outside Section 27. The words 'any urban or urbanisable land with a building or a portion of such building' as they are used in Section 27(1) are no doubt wide words to cover even vacant land with a building and land appurtenant thereto, but as the provisions of Section 27(l) are subject to the provisions of Sections. 5(3) and -10(4) which deal with vacant land in excess of ceiling limit and as there is no restriction in respect of sale of vacant land below ceiling limit except as contained in Section 26. these words do not cover vacant land at all which is specifically dealt with by the aforesaid provisions of the Act. The idea behind Section 27 was to create restrictions in respect of land with building not covered by the aforesaid provisions. Thus a building and land appurtenant thereto which are outside the definition of vacant land or a building on land used for agriculture or a portion of a building were (not ?) covered by the provisions of Section 27. The difficulty is, however, created by the ruling of the Supreme Court in the case of Bhirn Singhji v. Union of India, AIR 1981 SC 234. In this case Section 27(1) was held to be partly invalid. Chandrachud, c. J., Bhagwati and Krishna Iyer, JJ., held as follows;

'We hold that the entire Urban Land (Ceiling and Regulation) Act of 1976 is valid save and except Section 27(1) in so far as it imposes a restriction on transfer of any urban or urbanisable land with a building or of a portion of such building which is within the ceiling area.'

(at page 238 of AIR SC).

Chandrachud, C. J. and Bhagvati, J. have yet to give fuller reason. Although Krishna Iyer, J. gave his reasons, there is nothing in his judgment to throw any light on Section 27(1). A. P. Sen. J., in his separate iudgment also held Section 27(1) to be partly invalid. His reasons and finding are as follows:

'If vacant land owned by a person falls within the ceiling limits for an agglomeration, he is outside the purview of Section 3 of the Act. That being so, such a person is not governed by any of the provisions of the Act. When this was pointed out to the learned Attorney General, he was unable to justify the imposition of the restriction imposed by sub-section (1) of Section 27 in case of land falling within the ceiling limits as a reasonable restriction. It must, accordingly, be held that the provision of subsection (1) of Section 27 of the impugned Act is invalid insofar as it seeks to affect a citizen's right to dispose of his urban property in an urban agglomeration within the ceiling limits,' We need not refer to the iudgment of - Tulzapurkar, J., as he held the entire Act to be invalid. In the absence of reasons given by the Chief Justice and Bhagwati, J., it is natural for us to feel diffident in understanding the import of the declaration that Section 27(1) is partly invalid. The question before us is as to what is meant by the declaration contained in the order of Chandrachud. C. J., Bhagwati and Krishna lyer, JJ., 'that Section 27(1) insofar as it imposes the restriction on transfer of urban or urbanisable land with a building or of a portion of such building within the ceiling area' is invalid and whether a building and land appurtenant thereto fall within the section to the extent it now survives.

7. A building and land appurtenant thereto can in no situation be declared to be surplus or exceeding the ceiling area prescribed by the Act. Therefore, a building and appurtenant land are always within the ceiling area and so no permission would be needed under Section 27(1) for sale of a building and land appurtenant to it. The learned Government Advocate who appeared for the respondents also agreed that in view of the ruling of the Supreme Court in Bhim Singhji's case if a person holds a buildings and land appurtenant thereto and does not hold any vacant land in excess of the ceiling area, it would not be necessary for him to apply under Section 27(1) tor selling the building or land. The learned Government Advocate, however, submits that if a person holds vacant land in excess of the ceiling area then such a person cannot sell even the building and the land appurtenant thereto without applying under Section 27. It is difficult to accept this argument of the learned Government Advocate. A building - with land appurtenant thereto is always within the ceiling area, for in case it can be declared surplus under the provisions of the Act, and, therefore, the sale of such property would not attract the application of Section 27 to the extent held to be valid by the Supreme Court irrespective of the fact whether the owner holds any vacant land in excess of the ceiling area. We have already indicated that restrictions as to the transfer of vacant land, whether within or in excess of the ceiling area, are contained in Sections. 5(3). 10(4) and 26 of the Act. Section 27 has nothing to do with that. Although reasons have not yet been given by Chandrachud. C. J. and Bhagwati, J., the ground for declaring Section 27 (li oartly invalid as it appears from the judgment of A. P. Sen, J., is that to the extent urban property is not covered by the ceiling limit imposed under the Act, any restriction on its transfer is unreasonable. This lends support to our inference that Section 27(1) to the extent it survives does not apply to a transfer of a building and land appurtenant thereto irrespective of the fact that the owner holds vacant land in excess of the ceiling limit.

8. Respondent No. 1 admittedly held vacant land in excess of the ceiling limit. The ceiling limit for vacant land for Jabalpur is 16, 146 sq. ft. The building standing on plot No. 7/1 covering an area of 5.422 sq. ft. and land appurtenant which, according to the definition given in Section 2(g) comes to 1000 metres i. e. 10,763 sq. ft. were outside the ceiling limit. There was no restriction for sale of this property. However, the respondent agreed to sell to the petitioner some vacant land also. The total area which the respondent agreed to sell to the petitioner is 16.500 sq. ft. out of which an area of 4,142 sq. ft. is covered by buildings and an area of 10,163 sq. ft. may be taken to be the appurtenant land. The remaining area agreed to be sold i. e. 2195 sq. ft. is vacant land. For permission to sell buildings and appurtenant land no application was needed under Section 27. As regards vacant land, no permission could be applied for under Section 27 for sale of vacant land is completely banned under Section 5(3) until a notification is issued under Section 10(1). It is not in dispute that that stage has yet to come. The respondent's application under Section 27 was, therefore, misconceived. It was filed at a time when the Supreme Court had not pronounced its view on the vires of that section. As the application made under Section 27(1) was not tenable, the Competent Authority could not exercise the option under Section 27(5).

9. It was argued by the learned Government Advocate that the agreement entered into between the petitioner and respondent No. 1 covered vacant land along with buildings and appurtenant land and as vacant land and appurtenant land were contiguous, it was not possible to demarcate them and so the agreement could not be implemented without permission granted under Section 27, It is true that the agreement is a composite agreement and it is not possible to demarcate the appurtenant land from the vacant land or to divide the agreement in two parts, one in respect of buildings and appurtenant land and the other in respect of vacant land. But from this it does not follow that Section 27 becomes applicable. As earlier pointed out. restrictions on transfer of vacant land are covered by Sections. 5(3), 10(4) and 26. A composite agreement like the one existing in this case between the petitioner and respondent cannot be implemented at this stage not because of any want of permission under Section 27 but because of restrictions contained in respect of transfer of vacant land under Sections. 5(3), 10(4) and 26. These sections do not prohibit the holder from entering into agreement for transfer. They only prohibit transfer. Therefore, after the period during which these sections operate is over and the requirements of those sections are satisfied, it may be possible to implement a composite agreement like the one existing in this case without any recourse to Section 27.

10. Even assuming that the learned Government Advocate is right that Section 27(1) applied and respondent No. 1's application could be made under that provision for permission for completing the sale in accordance with the agreement dated 11th Sept. 1978, yet such an application could not be allowed in respect of vacant land because of the ban imposed under Section 5(3). We have already stated that the provisions of S, 27(1) are 'subject to the provisions of Sections. 5(3) and 10(4). The agreement entered into between the petitioner and respondent No. 1 was a composite agreement. It could not be separated into two parts, one for sale of vacant land and the other for sale of buildings and appurtenant land. In such a situation, the application for permission to complete the sale in accordance with the said agreement could not be granted at all. The option to purchase under Section 27(5) can be exercised only when the Competent Authority is of opinion that permission may be granted. As in the instant case no permission could be granted, the provisions of Section 27(5) for exercise of option were not at all attracted. The competent Authority could have rejected the application on the ground either that it was not maintainable because section 27(1) was not applicable or on the ground that even if Section 27(1) applied, permission could not be granted in view of the ban imposed by Section 5(3). In either case, the application had to be rejected and there was no scope for exercising the option, It has, therefore, to be held that the order of the competent Authority dated 29th December 1979 exercising the option to purchase the property is invalid,

11. We have already stated that the agreement entered into between the petitioner and respondent No. 1 is a composite agreement. The agreement is partly for sale of building and appurtenant land and partly for sale of vacant land. The agreement was not hit by Section 5(3) because this provision interdicts a transfer and not an agreement for transfer. The petitioner, however, cannot be granted any relief for specific performance by issuing a mandamus for various reasons. Firstly, no mandamus is issued for specific performance of a contract; secondly, the ban imposed under Section 5(3) is still continuing; thirdly we do not know if the vacant land covered by the agreement may not be declared surplus under Section 10(1); and lastly even if it is not declared surplus, sale of that land will be possible only after complying with Section 26.

12. The question that now remains to be decided is whether we should declare the sale deed dated 16th May 1980 in favour of the Government invalid. We have already held that the order of the Competent Authority exercising the option is invalid. The sale deed executed in pursuance of that option would also be invalid. The point to be considered, however, is whether we should declare it to be invalid. In this connection it is relevant to consider that respondent No. 1 has not come forward to challenge the sale and the petitioner's right to enforce the agreement in his favour is yet to be worked out in a suit for specific performance which he may or may not file after the expiry of the period during which the ban under Section 5(3) operates and after it becomes clear that Section 10(4) is not applicable arid after the requirement of Section 26 is complied with. In these circumstances, it would not be a proper exercise of our discretion to declare the sale invalid and that question should be left to be decided in the suit for specific performance which the petitioner may file at a later stage in case he is so advised.

13. The petition is partly allowed. The order of the Competent Authority dated 29th December 1979 exercising the option is declared invalid. We, however, decline to declare sale deed dated 16th May 1980 invalid. There will be no order as to costs. The security amount be refunded to the petitioner.


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