SC upholds HC order cancelling allotment of land to mediation centre in Hyderabad

The HC judgment came on two PILs, which challenged three government orders: Land being alloted in Raidurg village, financial aid of Rs 3 crore being granted, and all state government departments and public sector undertakings being directed to refer their disputes above Rs 3 crore to the IAMC for arbitration.

Senior Advocate A M Singhvi represented the state in the appeal while Senior Advocates Gopal Sankaranarayanan and Vikram Pooserla appeared for IAMC.

The PILs had argued that the land should not have been allotted to the IAMC, which is not a statutory body but a private one making profits.

The HC had said in its order that under Rule 3(a) of the Andhra Pradesh (Telangana Area) Alienation of State Lands and Land Revenue Rules, 1975, “alienation of state land free of cost is only permissible in favour of a local body or a local authority for an unremunerative public purpose.” It said, “In case…where the land is sought to be alienated in favour of a private institution or a private individual or a company, the government should and is entitled to charge market value of such land.”

The HC had said, “Rule 2(j) defines ‘public purpose’ as a purpose which confers a benefit on a considerable section of the community or locality or region. Public purpose is said to include construction of schools, temples, churches, mosques, choultries, roads, hospitals, and office buildings of local bodies and authorities. The definition of public purpose is restricted only to primary public purpose. Any ancillary purpose cannot be termed as public purpose to allot land.”

The HC had said that “as is evident from the MoU” inked between IAMC and the state government in 2021, and the government order allotting land, “the subject land was allotted in favour of the IAMC without assessing, charging and collecting the market value. Further, as on the date of allotment, the IAMC was not registered as a company.”

The HC had said that “the conduct of the government in allotting the land was unduly hasty”. It had said, “Possession certificate was issued in favour of the IAMC even before formulating and communicating the terms of allotment. Such hasty decisions do not bode well and often result in exercise of power contrary to the procedure.”

The HC had, however, upheld the government orders providing financial aid and referring government disputes to the IAMC saying they “are in line with the broad policy of the government to promote alternative dispute resolution…”