State of Andhra Pradesh (now State of Telangana) & Ors. vs. Dr. Rao V.B.J. Chelikani & Ors.
Background
Between 2006 and 2008, the (undivided) Andhra Pradesh Government allotted prime land parcels within Greater Hyderabad to Cooperative Societies formed by select groups: Members of Parliament and the State Legislature, All-India Services officers, judges of the Supreme Court and High Courts, government employees, defence personnel and journalists, at concessional rates. Writ petitions challenged this as an arbitrary and discriminatory use of public land. The Andhra Pradesh High Court partly allowed the challenge, quashing the government orders and directing restoration of the land, subject to fresh, verified allotments. Cross-appeals by the State (now Telangana, post-bifurcation) and the affected societies/members reached the Supreme Court, along with connected contempt petitions.
Decision Breakdown
The Supreme Court held that the land allotment policy was unconstitutional, being arbitrary and violative of Article 14. It rejected the argument that MPs, MLAs, judges, senior officers and journalists could be treated as a special class entitled to preferential allotment of a scarce public resource like urban land, holding that the State holds land in trust for all citizens, and such differentiation amounted to unjustified favouritism benefiting an already-privileged section of society rather than the marginalised. The classification failed the constitutional test for permissible discrimination, since it merely grouped "the powerful" together without a rational, non-arbitrary basis connected to any legitimate public purpose. The Court dismissed the appeals of the Cooperative Societies/State seeking to retain the land, upheld cancellation of the allotments and lease deeds, and ordered restitution: refund of all amounts (including stamp duty, registration fees and development charges) paid by the societies/members, with interest, leaving the State of Telangana free to deal with the land as per law.
Lesson Learnt
Public land and other State resources cannot be carved out for preferential, discounted allotment to elite or influential groups (legislators, judges, bureaucrats, journalists) merely because of their status: such schemes are treated as a colourable, arbitrary exercise of power and will be struck down under the constitutional guarantee of equality.