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Narayanrao Jagobaji Gawande Public Trust v. State of Maharashtra and Ors.

Civil Appeal · Neutral citation not assigned (Civil Appeal No. 870 of 2016)Decided 4 Feb 2016
Civil Appeal No. 870 of 2016
Justice V. Gopala Gowda · Justice Amitava Roy

Background

The appellant-trust owned land in Nagpur that fell within a 1939 Civil Station Expansion Scheme of the Nagpur Improvement Trust (NIT). When the owner sought to develop the land into a residential layout, he signed a development agreement with NIT containing a clause requiring that any portion of the land earmarked for a school or other public utility be handed over to NIT free of cost, without compensation, once developed. Decades later, NIT exchanged part of this reserved land with a different plot allotted to a college, prompting the trust and other affected landowners to challenge the allotment before the Bombay High Court (Nagpur Bench), arguing the free-transfer clause was void as an unconscionable, unstamped and unregistered contract. The High Court dismissed all the writ petitions, holding NIT's action lawful, and the trust and seven other connected appellants brought these appeals to the Supreme Court.

Decision Breakdown

The Supreme Court held that the development agreement, including the clause requiring free transfer of land reserved for public utility purposes, was executed voluntarily by the landowner, was consistent with the sanctioned development plan under the Maharashtra Regional & Town Planning Act, 1966 and the Nagpur Corporation Act, 1948, and could not later be challenged as unconscionable after the owner had taken the benefit of the layout sanction for years: a person cannot "approbate and reprobate." The Court found the High Court's findings well-reasoned and free of legal error, declined to interfere, and dismissed all the appeals (including this one, Civil Appeal No.870/2016), while vacating an earlier interim status-quo order.

Lesson Learnt

A landowner who voluntarily accepts the benefits of a development/layout sanction under a town-planning scheme cannot later resile from a clause in that same agreement requiring reserved land to be surrendered free of cost for public utility purposes: courts will not let a party accept the favourable parts of a bargain while rejecting the unfavourable parts years later.

Official source (sci.gov.in)View Judgment (PDF)

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