M/s.Southern Industrial Corporation Ltd. v. The Government of Tamil Nadu

C O M M O N O R D E R The writ petition in W.P.No.1964 of 2006 is for a directionagainst the Government to dispose of the representation dated22.02.2003, filed by Southern Industrial Corporation Ltd., which isnow a division of South India Corporation (Agencies) Ltd.,represented by its Chief Human Resources Officer.2. The writ petition in W.P.No.5365 of 2007 is filed by M/s.IndiaRadiators Ltd., for a direction against the respondent Government toissue orders pursuant to the direction of this Court in ContemptPetition No.46 of 2006 in W.P.No.26745 of 2004.3. The factual matrix relating to these cases is that theGovernment has assigned a total extent of 37.39 acres of land inS.No.459/2 at Puzhal Village (Redhills) on market value toM/s.Southern Industrial Corporation Ltd., Madras, the petitioner inW.P.No.1964 of 2006 in G.O.Ms.No.2240, Revenue Department, dated31.05.1957. The said assignment was for expansion of its factory.Out of the said total extent of land, land measuring 7.10 acres wastransferred by the M/s.Southern Industrial Corporation Ltd., toM/s.India Radiators Ltd., which is its sister concern, the writpetitioner in W.P.No.5365 of 2007. On the basis that the saidtransfer is in contravention of the assignment of land, theGovernment ordered resumption of land in G.O.Ms.No.1786, RevenueDepartment, dated 07.08.1975. As against the said resumption order,writ petitions were filed by both the writ petitioners. W.P.Nos.5004& 5192 of 1979 were filed by M/s. Southern Industrial CorporationLtd., and W.P.Nos.5173 & 5279 of 1979 were filed by M/s. IndiaRadiators Ltd. The said writ petitions were disposed of by an orderdated 05.09.1986, by appointing Mr.A.L.Somayaji, Advocate asarbitrator for the purpose of determining the market value of thelands, subject matter in dispute and on said determination, the Stateshall reassign the lands concerned to the assignee on their payingthe market value as per the determination.4. As against the said order, the State Government has filed WritAppeal in W.A.Nos.1236 to 1239 of 1986 in which by an order dated09.08.1989, while dismissing the appeal, it was made clear thatarbitrator could continue, directing him to fix the market value ofthe property as on 28.10.1981, the date on which the Government hasresolved to reassign the lands to the individual purchasers from theoriginal assignee viz., Southern Industrial Corporation. The Awardof the arbitrator dated 18.03.1991, was received by this Court inO.P.No.217 of 1991 and by an order dated 13.08.1991, the market valueof the land in question was fixed at the rate of Rs.2,500/- perground as on 28.10.1981. Therefore, according to the petitioners, on passing of the said decree based on the arbitration Award, the entire https://hcservices.ecourts.gov.in/hcservices/ matter has become final and therefore, the Government should haveannulled the earlier order for resumption and reassigned the lands tothe extent of 25.18 acres to the petitioner in W.P.No.1964 of 2006M/s. Southern Industrial Corporation Ltd., and 6.86 acres to thepetitioner in W.P.No.5365 of 2007 M/s.India Radiators Ltd., who isthe transferee from the original assignee viz. M/s.SouthernIndustrial Corporation Ltd., who has filed writ petition inW.P.No.26745 of 2004 for a direction against the Government todispose of the representation made between 25.02.1998 to 28.07.2004for reassignment of lands. By an order dated 20.09.2004, this Courthas disposed of the said writ petition directing the respondent toconsider the said representations and pass orders on merit and inaccordance with law within a period of eight weeks. Since no orderwas passed, M/s. India Radiators Ltd, filed contempt petitionNo.46/2006, which was disposed of by this Court taking intoconsideration that the Government needed two months time due to theintervening General Elections to the Tamil Nadu Assembly, directedthe Government to pass orders immediately after the elections andwith that direction, the contempt petition was closed. In spite ofthe said order, the respondent Government has not passed any orders,which necessitated the petitioners to file the above said writpetitions for directions as stated above.5. The Government has filed counter affidavit in W.P.No.5365 of2007. It is the case of the respondent Government that an extent of39.94 acres of land comprised in S.No.459/2 and 460/2 at PuzhalVillage were assigned to M/s.Southern Industrial Corporation Ltd.,with conditions under Revenue Standing Order 15 and 24 as perG.O.Ms.No.2240, Revenue Department, dated 31.05.1957 andG.O.Ms.No.4947, Revenue Department, dated 16.11.1961. However, M/s.Southern Industrial Corporation Ltd., has sold an extent of 14.76acres against the assignment condition to the following threeorganisations viz.,Name of companyDate of SaleExtent of acresTube Suppliers Ltd.02.03.19625.00India Radiators Ltd.18.07.19634.76Popli Raja High School14.10.19705.00Total 14.76It is also stated by the respondent that subsequently, Tube SuppliersLtd to whom M/s. Southern Industrial Corporation Ltd., has sold 5.00acres, has sold to:(1)M/s.Tokushu Menon Papers Ltd., an extent of 2.90 acres on14.10.1977 and https://hcservices.ecourts.gov.in/hcservices/ (2) M/s. India Radiators Limited an extent of 2.10 acres on17.01.1972.Therefore, M/s. India Radiators Ltd., petitioner in W.P.No.5365 of2007 have purchased 6.86 acres out of the total assigned lands.Since that was in violation of the assignment condition, byG.O.Ms.No.1786, Revenue Department, dated 07.08.1975, the Governmentordered resumption of the entire land measuring 39.94 acres assignedto M/s.Southern Industrial Corporation Ltd., 6. While the said cases were pending it was informed by theGovernment to the Court that the Government has decided to reassignthe lands to the companies concerned on collection of double themarket value. Therefore, this Court has appointed Mr.A.L.Somayaji,Advocate as arbitrator to determine the market value of the lands.Writ Appeals filed by the Government was dismissed and the arbitratorhas fixed the market value at the rate of Rs.2,500/- per ground as on28.10.1981, without any further particulars as to which basis theamount was fixed. The petitioners have contended that the land valueis Rs.1,500/- per ground while the Government has placed claim ofRs.3,400/- per ground. The Award of the arbitrator dated 18.03.1991,was sent to the Government on 12.04.1991 and direction was issued totake necessary action to set aside the Award, but no action has beentaken by the District Administration. In those circumstances,O.P.No.217 of 1991 filed by the Arbitrator has been allowed anddecree was passed on 13.08.1997, in terms of the Award. 7. It is the case of the respondent Government that guidelinevalue as on date in respect of S.No.459/2 works out to Rs.12,48,000/-per ground and Rs.5,08,800/- per ground in respect of S.No.460/2. Itis also stated by the respondent in the Counter affidavit that inFebruary 1998, M/s.Southern Industrial Corporation Ltd., and M/s.India Radiators Limited represented to the Government to reassign thelands of 25.18 acres and 6.86 acres respectively in S.Nos.460/2 and459/2. In the meantime, M/s.Tokushu Menon Papers Ltd., who purchased2.90 acres from M/s.Tube Suppliers Ltd., filed writ petition inW.P.No.14963 of 2001 with request to reassign the lands and the saidwrit petition was dismissed on 02.08.2001, leaving it open to thepetitioner to pursue his remedies before the revenue authorities. OnM/s. India Radiators Ltd., filing writ petition in W.P.No.26745 of2004, direction was issued by this Court on 20.09.2004, to considerthe representation and pass orders. In the meanwhile in the ContemptApplication filed by M/s. India Radiators Ltd in Contempt PetitionNo.46 of 2006, basing reliance on the letter of the Government dated 10.03.2006, addressed to the then Additional Government Pleader, thecontempt petition was closed with a direction to the Government topass orders immediately after the elections are over. https://hcservices.ecourts.gov.in/hcservices/

8. It is the case of the respondent Government in the counteraffidavit that any reassignment of lands could be based only on themarket value prevailing on the date of reassignment and therefore themarket value as on 28.10.1981, cannot be legitimately considered tobe the value of the land. It is also the case of the respondent thatassignment of the said land at the old rate would be prejudicial topublic interest. By applying the same, heavy financial loss willaccrue to the Government and therefore, fresh Arbitrator has to beappointed to fix the correct market value. Therefore, according tothe respondent after a lapse of 25 years, it is improper to assignthe land on the value which was in existence as on 28.10.1981.9. It is the case of the respondent Government that by letterdated 03.05.2007, the Government was prepared to reassign the land onthe fresh market value and without challenging the said order,present writ petition is filed and therefore the same is notmaintainable especially in the changed circumstances. It is alsostated that there was some dispute in respect of employees ofM/s.India Radiators Ltd. Employees numbering 143 out of whom manywere terminated and few were given re-employment and again terminatedand subsequently the company was closed between 16.11.1999 to06.07.2000 and the matter was referred to the Commissioner of Labourand the matter is pending and no activities are going on in thefactory premises.10. It is also stated that the problem was referred to Board forIndustrial and Financial Restructure (BIFR) in which there was adirection to liquidate the company and to declare it as a sickindustry. In such circumstances, reassignment of the said lands tothe petitioner company will only pave way to the sick company to usethe land as real estate value to mitigate the company's liabilitiesand not for industrial purpose. Therefore, the company no longerrequires land to carry out the business in radiator industry, whichwas the object of the Government and therefore in the changedcircumstances there is no possibilities for reassignment of land onthe value fixed on 28.10.1981.11. Mr.T.R.Rajagopalan, learned senior counsel appearing for thepetitioner would submit that in as much as under the Arbitration Act,1940, the Award passed by the Arbitrator has become a decree whichhas become final, it is the duty of the respondent Government to actas per the decree passed in terms of the Arbitration Award. Theconduct of the respondent Government in claiming the market value as on today is only a gross violation of the decree passed by this Courton the original side. The learned senior counsel would also submitthat if the apprehension of the Government is that the petitionercompany in W.P.5365 of 2007 being declared as a sick industry, anyreassignment will only pave way not to use such land for industrial https://hcservices.ecourts.gov.in/hcservices/ purpose, the petitioner in the said writ petition is prepared to fileaffidavit to the effect that such land will be used only forindustrial purpose. In fact, such an affidavit was also filed onbehalf of M/s. India Radiators Ltd., giving an undertaking that afterthe assignment, the petitioner company will use the said propertyonly for industrial purpose. It is also stated in the said affidavitof March 2008 that BIFR directed winding up of the company againstwhich the company has filed an appeal before AAIFR. It is alsostated that AAIFR has directed the company to file rehabilitationscheme and the same has already been submitted and it is pending. Asper the rehabilitation scheme a joint venture arrangement forproduction and manufacture of Automobile components and accessoriesincluding Oil Coolers and Exhaust System from the factory situate inthe property were made and revised rehabilitation scheme would besubmitted by the company before the AAIFR. The said petition isfiled without prejudice to the right of the petitioner company. 12. However, subsequently, on instructions from the Government,the learned Advocate General has submitted that the Government wasnot willing for any assignment. It is the contention of the learnedAdvocate General that in so far as the petitioner in W.P.No.5365 of2007, the circumstance in existence as on today is totally differentfrom what was in existence earlier. Admittedly, the company hasbecome sick and BIFR has passed order of winding up and the companyremained closed from 1999 and simply because the rehabilitationscheme is pending before AAIFR, it does not mean that there will berevival of industrial activities by the petitioner company especiallyin the circumstances that 143 workers are also making a claim againstthe company and therefore it cannot be said that there should be anyassignment to such company.13. I have heard Mr.T.R.Rajagopalan, learned senior counselappearing for the petitioners and Mr.G.Masilamani, learned AdvocateGeneral appearing for the respondent and gave my anxious thoughts tothe issues involved in this case.14. As it is seen in the counter affidavit, the extent of landsassigned/transferred, which stood non-controverted by the writpetitioners are as follows: (i) The assignment to M/s. Southern Industries Corporation Ltd.,writ petitioner in W.P.No.1964 of 2006 an extent of 39.94 acres underG.O.Ms.No.2240, Revenue Department, dated 31.05.1957 andG.O.Ms.No.4947, Revenue Department, dated 16.11.1961.(ii) M/s. Southern Industrial Corporation Ltd., sold 14.76 acresout of 39.94 acres to three companies viz., https://hcservices.ecourts.gov.in/hcservices/ Name of companyDate of SaleExtent of acresTube Suppliers Ltd.02.03.19625.00India Radiators Ltd.18.07.19634.76Popli Raja High School14.10.19705.00Total 14.76(iii) M/s. Tube Suppliers Ltd who purchased 5 acres from M/s.Southern Industrial Corporation Ltd., as stated above has sold to twocompanies viz., Name of companyDate of SaleExtent of acresTokhusu Menon Private Ltd14.10.19702.90India Radiators Ltd.19.01.19722.10Total5.00(vi) The extent of land stood as follows:(a) M/s. Southern Industrial Corporation Ltd, writ petitioner in W.P.No.1964 of 2006-25.18 acres(b) M/s. India Radiators Ltd., writ petitioner in W.P.No.5365 of 2007 (4.76 + 2.10)- 6.86 acres(c) M/s.Tokhusu Menon Private Ltd.,- 2.90 acres(d) M/s. India Radiators Ltd.,- 5.00 acresthe other two companies are not parties before this Court.15. A reference to the said Government orders shows thatassignments are subject to usual conditions of assignment in BoardStanding Order (BSO) 15, special condition prescribed in para 6 ofBSO 24 and the said assignment is also on payment of single marketvalue of Rs.1,000/- per acre. The assignment as per the GovernmentOrder is for the expansion of factories and the lands assigned areregistered as grazing ground poramboke. Under the BSO 15 which dealswith the disposal of land, while Clause 1 speaks about the generalprinciples, Clause 1.A deals with various conditions regarding theassignment, alienation, lease etc., which is as follows:“1.A. (i) Grant of land by the Government in the formof assignment, alienation, lease, etc., is governed by theprovisions of the Government Grants Act (Central Act).According to the provisions in the Government Grand Act,grant of Government land will not be governed by the https://hcservices.ecourts.gov.in/hcservices/ provisions of the Transfer of Property Act, unless specificprovisions are made in the order of grant by the Governmentthat title to the property will pass on to the assigneesubject to complying with the conditions of grant or afterthe expiry of a certain period. The grantee of the land,therefore, does not acquire title, simply under the ordersof grant of land by the Government.(ii) The land may be assigned for private purpose,such as for cultivation, for house site and for industrialpurposes free of land value or on payment of land value,subject to the conditions imposed in order of grant. Theland would be available with the grantee, so long as theconditions of grant are satisfied. The question ofacquisition of title to the land will be governed only bythe conditions of grant and not otherwise.(iii) Assignment of land free of value:- If the landwas assigned for cultivation or house site purpose, free ofland value, and if there was a condition that the landshould be utilised within a specific period and it could bealienated after expiry of the specific period, then theassignee acquires title to the property, only after theland was utilised for the purpose for which it was grantedand only after expiry of the specific period. The land canbe resumed, if the land is alienated, before the expiry ofperiod specified, even if the land was utilised within theperiod specified for the purpose for which it was granted.(iv) Assignment of land free of value:- If, on theother land – condition was imposed when land was assigned,free of land value to the effect that the assignee shouldnot be disposed of the property, then the title to the landdoes not pass on to the assignee at any length of time. Hecan utilise the land, as long as the conditions aresatisfied. If the conditions of grant are violated thenthe land can be resumed.(v) Assignment of land on payment of value:- In case,the land is assigned, on payment of land value and acondition was imposed in the order of grant, to the effectthat the assignee could not dispose of the property, then the land could be resumed, if the land was either notutilised for the purpose for which it was granted, withinthe specified period or alienated to others, even afterutilising the land.(vi) Payment of compensation on resumption:- Regarding https://hcservices.ecourts.gov.in/hcservices/ the payment of compensation of the land or improvementsmade therein or towards structures erected, in the case oflands assigned, on payment of land value, if a conditionwas imposed to the effect that no compensation would bepaid towards the land value or improvements made therein ortowards structures erected, and if the land is resumed forviolation of the conditions of grant, then the land couldbe resumed, without payment of compensation to land valueor improvements made or structure constructed. If thecondition imposed relates only to the non-payment ofcompensation to the improvements made or structureserected, then it should be taken for granted that nocompensation should be made to the land value also.(vii) Payment of compensation on resumption:- In caseof land assigned to a person, on payment of land value withusual conditions and also another condition that theassignee could dispose of the property, after expiry of aspecific period, then only, he acquires title to theproperty under the Transfer of Property Act, after theexpiry of the time limit specified therein and only afterthe conditions of the grant are satisfied.(viii) Payment of compensation on resumption:- If, onthe other hand, a condition was imposed to the effect thatthe assignee could not alienate the land after expiry ofthe specific period, within which the land should beutilised then the land could be resumed, without payment ofcompensation to the land or for the improvements made orthe structures constructed, if the land is alienated, atany time, notwithstanding the fact that the conditions ofgrant are complied with”16. For the purpose of the present case and on the reading of theGovernment orders by which assignment was made to M/s.SouthernIndustrial Corporation Ltd., it has to be taken as assignment of landon payment of value which is covered under Clause 1.A(i) and 1.A(v).The said condition enables the Government to resume the land if it isnot used for the purpose for which it was assigned. Likewise, BSO 24which deals with the placing State land at the disposal of a person,an institution etc., para (6) imposes condition for grant of State land which is as follows:“6. Condition for grant of State land-(i) Lands at the disposal of Government:- A grant ofState land whether for religious, educational or otherpublic purpose should always contain the followingconditions:- https://hcservices.ecourts.gov.in/hcservices/ (1) The land shall be used........... and for no otherpurpose.(2) The Government may resume the land wholly or inpart with any buildings thereon, in the event of theinfringement of any of the conditions of the grant. In theevent of such resumption no compensation shall be payablefor any improvements that may have been effected, or otherworks that may have been executed on the land by the granteeand the grantee shall not be entitled to the repayment ofany amount that may have been paid to the Government for thegrant. If there are buildings on the land the Governmentmay direct the grantee to remove them.The land, if utilised for commercial purpose, when thegrant is made free of land value, the beneficiary shall beliable to pay the market value of the land either totally orfor the portion converted into commercial purpose as decidedby the Government.(3) The Government may resume the land wholly or inpart, with any buildings thereon, if in the opinion of theGovernment the land is required for a public purpose or forconducting mining operations. In the event of suchresumption or in the event of the acquisition of the landfor any reason, the compensation payable for the land andtrees, shall in no case exceed the amount paid for them bythe grantee or their value at the time of resumption oracquisition whichever may be less.(4) In the event of resumption under condition (3), ifthere are buildings on the land, the Government shall paycompensation for them in accordance with the provisions ofcondition (5).(5) In the event of the resumption of land undercondition (3) or in the event of the acquisition of the landfor any reason the compensation payable for buildings orother improvements shall in no case exceed the amount paidfor them by the grantee at the time of grant or their valueat the time of resumption or acquisition whichever may beless, together with the initial cost or the value at thetime of resumption or acquisition, whichever may be less ofany buildings erected or other improvements effected on theland by grantee in accordance with the terms of the grant.The amount of any grant made by the Government towards thecost of the buildings or other improvements shall bededucted from the compensation payable under this condition. https://hcservices.ecourts.gov.in/hcservices/ (6) In the event of the grantee refusing to remove thebuildings, when so directed under condition (2), theGovernment may remove them and realise the cost of theremoval by the sale of the materials.(7) In the event of the voluntary relinquishment of theland by the grantee no compensation shall be payable for anyimprovements that may have been effected or for works thatmay have been executed on the land by the grantee but thegrantee shall be entitled to the repayment of any amountthat may have been paid to the Government, for the grant, orthe value of the land at the time of relinquishment,whichever may be less.(8) The Government reserve to themselves the right toall sandalwood trees and their branches and roots whichexist at the time of grant as well as those which may growsubsequently on the land and the Government shall be atliberty to cut or dig out any such trees or their roots andbranches and remove them from the land and dispose of themat their pleasure. The grantee shall not be entitled to cutor remove them or cause them to be cut or removed withoutpermission of the Collector of the district.(9) The grantee shall take all reasonable measures tothe satisfaction of the Collector of the district for theprotection of the sandalwood trees from theft or damage andfor the careful protection of the immature trees growing onthe land.(10) The grantee shall take steps to see that the marksmade by the officers of the Government on the sandalwoodtrees are preserved and are not tampered with.(11) In the event of the infringement of, or failure toobserve, any of the conditions (8) to (10), the granteeshall pay to the Government such compensation as isdetermined by the Collector of the district for any loss ordamage caused by such infringement or failure on his part.The Government shall also be at liberty to resume the landand re-enter on it and the whole land shall thereupon vestabsolutely in the Government. In that case the granteeshall not be entitled to any compensation whatever.(12) In cases where the land granted is more than 50 cents in extent, the grantee shall plant and maintain atleast 5 suitable trees per acre within one year from thedate of grant.” https://hcservices.ecourts.gov.in/hcservices/ Therefore, a combined reading of BSO 15 and para 6 of BSO 24 subjectto which assignment has been made in this matter makes it clear thatassignee should use only for industrial expansion failing which thesaid assignment could be resumed.17. In this case, it is not in dispute that due to the conduct ofthe assignee M/s. Southern Industrial Corporation Ltd., intransferring the assigned lands, the Government has orderedresumption of lands as per the BSO and conditions of assignment andthat was by G.O.Ms.No.1786, Revenue Department, dated 07.08.1975.18. The order of resumption as well as the actions of theGovernment including the District Revenue Officer and Thasildar inreassigning the lands as per the then existing market value in theyear 1979, where under challenge by the writ petitioners inW.P.Nos.5004 and 5192 of 1979 by M/s. Southern Industries CorporationLtd., and writ petitioner in W.P.Nos.5173 and 5279 of 1979 by M/s.India Radiators Ltd. While disposing of the said writ petitions, bya common order dated 05.09.1986, this Court has clearly observed asfollows:“On the ground that the transfers violated the terms ofthe assignments steps were taken to resume the lands coveredby the assignments. However the Authorities were preparedto make reassignments irrespective of the contraventionstaken note of earlier. This has obliged the assignee andM/s. India Radiators Ltd., one of the transferees to come tothis Court, seeking to quash the order of resumption andrestrain reassignments are notified by issuing writs ofCertiorari and Mandamus respectively.”19. A compete reading of the order of this Court makes it clearthat when representations have been made to the Government theGovernment was willing to reassign the land on the value fixed on thedate of such reassignment and for that purpose writ petition stoodadjourned to various dates and it has been the stand of theGovernment that the reassignment would be possible if the value ofthe land is fixed at the time of actual reassignment by theGovernment, which will be double the market value. Ultimately aftermany adjournments, this Court has passed the final order on05.09.1986, which is as follows:“To-day, Mr.P.Chandrasekharan, learned GovernmentAdvocate informs me the Government are not willing toappoint an agreed arbitrator by the parties or an arbitratorby the Court for fixing the land value, he has received aletter No.96204/A1?85-18, dated 01.09.1986 to that effectfrom the Joint Secretary to Government, Revenue Department, https://hcservices.ecourts.gov.in/hcservices/ Madras. The orders passed by this Court earlier and theimplications thereof cannot be lost sight of. Writ regardto reassignment, the State has not changed its stand,equally so, the petitioners have not expressed a differentopinion on this aspect. Hence the question of reassignmentstands settled and the question which requires resolutionrelates only to the fixing of the value for reassignment.The order of Sathiadev,J., dated 13.02.1986, has clearlycontemplated that with regard to determination of the marketvalue, that could be either by an agreed arbitrator or anarbitrator appointed by the Court. It is only on thataccepted basis, further orders were passed by me to find outas to whether there could be consensus between the partieson the question of the appointment of an arbitrator todetermine the market value. Today,As stated above, the stand of the State with regard toan agreed arbitrator has been made known and the State isnot willing for an agreed arbitrator. It is too late in theday for the State to make a further qualification that isnot willing to have an arbitrator appointed by the Court forfixing the land value. Already this Court, by order dated13.12.1986, has expressed the view that the value shall befixed either through an agreed arbitrator or by anarbitrator to be appointed by the Court. Since there is noconsensus between the parties with regard to appointment ofan arbitrator, this Court is obliged to appoint anarbitrator for determination of the market value on whichdetermination, the State shall reassign the lands to theassignee and such of the transferees who are willing to havethe reassignment on payment of the value so determined.Mr.A.L.Somayaji, Advocate of this Court is appointed as theArbitrator for the purpose of determining the market value of the lands, subject matter in dispute, as on date, aftergiving due notice to the parties concerned and affordingthem an opportunity to place materials in substantiation oftheir stand on the question of the market value, within aperiod of three months from the date of the service of copyof this order on him, which shall be done by the office ofthis Court. On such determination, the State shall reassignthe lands concerned to the assignee or such of thetransferees, who desire such reassignment on their payingthe market value as per the said determination. Thearbitrator will be entitled to remuneration at 1% of the market value of the lands as per his determination, whichshall be paid by the petitioners alone. The arbitratorshall be paid an initial renumeration of Rs.5,000/- within aperiod of one week from today, to be adjusted out of the https://hcservices.ecourts.gov.in/hcservices/ ultimate disbursement towards his renumeration. These fourwrit petitions are ordered in the above terms. No costs.If any of the parties have got any grievance with regard tothe determination of the market value by the Arbitrator,that could be the subject matter of an independent review byindependent proceedings and not by way of supplementalproceedings in these writ petitions. However, if thearbitrator requires any extension of time, he can approachthis Court for that purpose.” (emphasis supplied) 20. Even though it is clear that the State was not willing for anagreed arbitrator, ultimately, this Court has appointedMr.A.L.Somayaji as Arbitrator for determining the market value of thelands for the purpose of reassignment of lands to the petitioners.This Court has also directed that on such determination of value, theState has to reassign the lands to the assignee / transferee. On anappeal filed by the Government against the above said order, whiledismissing the same the Hon'ble Division Bench of this Court has heldas follows:“3. However, we make it clear that Mr.A.L.Somayajicould continue to be the arbitrator and he will fix themarket value of the property as on 28.10.1981, the date onwhich the Government resolved to reassign the lands to theindividual purchasers (namely, the writ petitioners) fromthe original assignee, viz., Southern IndustrialCorporation, Madras and not the market value as on the dateof the actual reassignment which are yet to take place.”As per the said order of the Division Bench the date of fixation ofmarket value was fixed as 28.10.1981, that is admittedly the date onwhich the Government has decided to reassign the land. The order ofthe Division Bench has become final.21. Therefore, the necessary implication is that when once theArbitrator has fixed the value as on 28.10.1981, there is a duty onthe part of the Government in reassigning the lands however, subjectto the willingness of the petitioners to pay the amount as fixed bythe Arbitrator. It is not in dispute that the petitioners arewilling to pay the value as fixed by the Arbitrator.22. The said Arbitrator who was appointed as per the IndianArbitration Act, (Act X of 1940) has passed the Award on 18.03.1991,fixing the market value of land in question at Rs.2,500/- per groundas on 28.10.1981 and this Court in O.P.No.217/91 has also passed adecree in terms of the Award which is as follows:“That the Market value of the lands in question be and https://hcservices.ecourts.gov.in/hcservices/ is hereby fixed at the rate of Rs.2,500/- (Rupees Twothousand and five hundred only) per ground as on28.10.1981.”The decree passed by this Court on the original side under theArbitration Act, even though fixing market value of the lands inquestion at Rs.2,500/- per ground as on 28.10.1981, the same has tobe read along with the order passed in W.P. Nos.5004, 5173, 5192 and5279 of 1979 and subsequent Judgment of the Division Bench inW.A.Nos.1236 to 1239 of 1986, by which it means clearly that onfixing of the market value by the Arbitrator, the State shallreassign the lands to the petitioners. Therefore, the contentionraised by the learned Advocate General that the decree passedpursuant to the Award passed by the Arbitrator only fixes the marketvalue of the land and there is no direction to the State Governmentto reassign the lands has no meaning at all. The purpose ofreferring to the Arbitrator by this Court while exercising powerunder Article 226 of the Constitution of India was for the purpose offixing the market value so as to make it obligatory on the part ofthe Government to reassign the lands to the petitioners. Reading ofthe decree passed in terms of the Award in isolation will becomemeaningless, since, direction given by the Division Bench was in nouncertain terms that the Government has already decided thereassignment of land to the individual purchasers namely the writpetitioners and it is for the purpose of reassignment, the Arbitratorwas directed to fix the market value. It is pertinent to note atthis point of time that both the orders in the writ petitions andwrit appeals as well as the decree passed in terms of the ArbitrationAward have become final and therefore, it is not open to theGovernment to raise any other issue including any change in thecircumstances. On the principle of judicial discipline, it is notonly the respondent Government which is bound by the order passed inthe writ petitions as confirmed in the writ appeals, apart from the Award passed in the form of a Decree, but this Court also cannot gobeyond the decision already arrived at in concrete terms by theDivision Bench.23. Therefore, it is not possible to construe as if there is noobligation on the part of the State Government in reassigning theproperty in favour of the petitioners on the ground that there hasbeen subsequent development regarding the petitioner in W.P.No.5365of 2007 M/s. India Radiators Ltd., that the said company has becomesick due to various reasons and that BIFR has ordered winding up andmatter is pending before AAIFR and therefore, the obligation of theGovernment as per the orders of this Court come to an end. Suchcontention would be antithesis to the very concept of bindingprecedents of the orders passed by the Courts between the partieswhich is the very basis of the judicial system. https://hcservices.ecourts.gov.in/hcservices/

24. The apprehension of the Government which is raised at thispoint of time that writ petitioner in W.P.No.5365 of 2007 which is asick company, is likely to use the land if it is reassigned, for anyother purpose other than industrial purpose has also no basisespecially in the circumstances that the petitioner therein viz.,M/s. India Radiators Ltd., has filed an affidavit before this Courtgiving an undertaking which is as follows:“3.....I am referring to the above factors only tobring to the notice of the Hon'ble Court that the PetitionerCompany will use the property only for industrial purposeand will not use it for any real estate development assubmitted on behalf of the State Government. I, on behalfof the Petitioner Company, give an undertaking that theproperty in question will be used only for industrialpurpose in a phased manner producing auto components, likefinned tube, cooling systems, as also logistics, warehousingand distribution of two-wheeler and four-wheeler componentsand not for any other purpose.....”Therefore, the apprehension of the Government in that regard is notwell founded. Even otherwise the State cannot raise such a ground inrespect of the petitioner in W.P.No.1964 of 2007 M/s. SouthernIndustrial Corporation Ltd., which is not a sick company. 25. One another factor which is relevant as to what transpired inContempt Petition No.46 of 2006 filed by M/s.India Radiators Ltd fordisobedience of order passed in W.P.No.26745 of 2004 dated20.09.2004, when this Court has directed the State to pass orders onthe representation of the petitioner within eight weeks. In thecontempt petition, the learned Additional Government Pleader has infact produced a letter addressed to him by the Secretary to Government dated 01.03.2006, in which the Secretary to Government hasrequired two months time to process the reassignment in view of theintervening General Elections to the Tamil Nadu State Assembly. Thusrecording the said letter, the contempt petition was disposed of bythis Court on 13.03.2006, with a direction to pass final ordersimmediately after the Elections are over. The following are therelevant paragraph:“3. Today, the learned Additional Government Pleaderproduced a copy of the D.O.Letter No.6022/LD.I (i)/98-34dated 10.03.2006 from the Secretary to Government, RevenueDepartment, wherein it is stated as follows:“As per the advice of the Hon'ble Court thematter of adding interest to the land value fixed hasbeen discussed between this department and the https://hcservices.ecourts.gov.in/hcservices/ Counsel appearing for M/s.India Radiators.Accordingly, the Company has accepted to add interestto the basic land value at simple rate of 12% from28.10.1981 till the date of re-assignment. Thecompany has given a written consent to this effectonly on 01.03.2006. Thereafter the matter is beingprocessed as per the rules. However, the Governmentneeds at least two months time to issue the finalorder particularly in view of the General Electionsto the Tamil Nadu Assembly having been announced. Infact, the final clearance from the ElectionCommission has to be obtained as the Model Code ofConduct is in force.I will therefore be grateful if you could kindlyplace the facts before the Hon'ble Court and obtaintwo months time so that the final order can be issuedimmediately after the Elections.”4. Considering the above, I am not inclined to pursuethe Contempt Petition any further. Accordingly the ContemptPetition is closed. However, the respondent shall passfinal orders immediately after the elections are over.” 26. The Government having taken such concrete stand for grant oftime in that proceeding agreeing for reassignment is not expected toact in such a manner to defeat the effect of Court orders. Whendirections were given to the Government in the contempt applicationto pass final orders, it means the Government has to pass ordersbased on the final decision in the earlier writ petitions which has been culminated into final order passed in Writ Appeals and decreepassed in terms of the Award of the Arbitrator. It does not meanthat the Government can pass orders by taking a totally differentstand in the order stated to have been passed on 03.05.2007, by whichthe Government has in effect refused to follow the earlier decisionas stated above. It is certainly not open to the Government to takeit lightly as if the petitioner has a remedy available by challengingthe order of the Government dated 03.05.2007. The Government beingthe largest litigant in the Country should certainly make itself as astanding example to others in respecting the rule of Law and followthe order of Courts which have become final and binding. 27. Unfortunately, in the present case, the inconsistent andunfair stand taken by the Government is not appreciable. It is notas if the respondent had no remedy available from the earlier orderswhich have become final and for any fault on the part of therespondent one cannot expect the Government machinery to go againstthe orders of the Court. https://hcservices.ecourts.gov.in/hcservices/

28. In view of the same, the writ petitions stand allowed, withdirection to the respondent Government to pass appropriate orders ofreassigning the lands in question on the basis of the market valuealready arrived at and approved by this Court in the form of a decreeand such order shall be passed within a period of four weeks from thedate of receipt of a copy of this order. No costs.Sd/-Vacation Officer./true copy/Sub Asst. Registrar. kkToThe Secretary to Government,Revenue Department,Fort St. George, Chennai – 600 009.+ 1 CC To Mr.S.Balasubramanian Advocate SR NO.27478+ 1 CC to the Government Pleader SR NO.27494 + 1 CC To Mr.G.Balasubramanian Advocate SR NO.27535PRE DELIVERY ORDER inW.P.Nos.1964 of 2006 & 5365 of 2007TEJ {CO}TP/10.6