JAL MAHAL RESORTS P. LTD. versus K.P. SHARMA & ORS.

Citation: [2014] 11 S.C.R. 765 · Decided: 25-04-2014 · Supreme Court of India · Bench: GYAN SUDHA MISRA · Disposal: Case Partly allowed

Judgment (excerpt)

• 
[2014] 11 S.C.R. 765 
JAL MAHAL RESORTS P. LTD. 
v. 
K.P. SHARMA & ORS. 
(Civil Appeal No. 4912 of 2014 ETC.) 
APRIL 25, 2014 
[GYAN SUDHA MISRA AND 
PINAKI CHANDRA GHOSE, JJ.] 
A 
B 
Public Interest Litigation - Grant of lease of 100 acres of 
land for 99 years - By State Government- To private party C 
- Around Mansagar Lake in Jaipur - For restoration and 
conservation of the lake into an attractive tourist destination 
- Grant of lease challenged in PIL in High Court - Petitions 
allowed - On appeal, held: The public interest litigations 
clearly fail the test of utmost good faith - Sufficient economic 
D 
diligence were used before issuing the Request for Proposal 
and subsequently accepting appellant's highest financial bid 
- There was no ma/a fide in the decision making process -
Entire 100 acres was not part of the /akebed - As per revenue 
entries only 8.65 acres land is classified as 'gairmumkin ta/ab' 
E 
(fakebed) and the balance land that is 100 acres less 8.65 
acres is recorded as 'Banjar' - Therefore area of 8. 65 acres 
shall stand re-transferred to the Government - Area of 14. 15 
acres although shall be notionally treated as part of the lease 
deed, it shall be treated as a construction-free zone -
F 
Remaining portion of the land, forming part of the lease-deed 
shall remain intact to be used by the lease-holder as per the 
terms and conditions of the lease-deed already executed -
However, grant of lease for 99 years is not permissible under 
Rules - The maximum period for the lease-deed as per the 
G 
Rules could not have been more than 30 years - Therefore, 
the period of lease reduced to a period of 30 years which 
should ordinarily start from the date of its execution - But in 
view of the fact that much time has lapsed after execution of 
765 
H 
766 
SUPREME COURT REPORTS 
[2014] 11 S.C.R. 
A the lease deed in 2005 due to delay on account of the 
litigation, period of 30 years shall be counted from the date 
of the instant judgment - After expiry of 30 years of lease 
period and in case the lease deed is not renewed in favour 
of th~ present /ease-holder, the State to compensate them at 
B the market value of the project including compensation for the 
loss of business and profit - Jaipur Development Authority 
Act 1982 - Rajasthan Improvement Trust (Disposal of Urban 
Land) Rules, 1974 - r. 18 
JudicifJ/ review - scope of - Held: The power of judicial 
C review of the executive and legislative action must be kept 
within the bounds of constitutional scheme, in consonance 
with the principle of separation of powers - Interference with 
the decisions of the State Authorities which are based on the 
opinion of the experts, technocrats, and the State 
D administrators would lead to a friction among the three organs 
of the State and would affect the principle of separation of 
powers. 
Partly allowing the appeals, the Court 
E 
HELD: 1. The power of judicial review of the 
executive and legislative action must be kept within the 
bounds of constitutional scheme so that there may not 
be any occasion to entertain misgivings about the role 
of judiciary in out-stepping its limit by unwarranted 
F judicial activism. The democratic, set-up to which polity 
is so deeply committed cannot function properly unless 
each of three organs appreciate the need for mutual 
respect and supremacy in their respective fields. 
However, it does not mean that howsoever gross or 
G abusive may be an administrative action or a decision 
which is writ large on a particular activity at the instance 
of the State or any other authority connected with it, the 
Court should remain a passive, inactive and a silent 
spectator. There has to be a boundary line while 
H 
• 
• JAL MAHAL RESORTS P. LTD. v. K.P. SHARMA 
767 
examining the correctness of an administrative decision 
A 
taken by the State or a Central Authority after due 
deliberation and diligence which do not reflect 
arbitrariness or illegality in its decision and execution. If 
such equilibrium in the matter of governance gets 
disturbed, development is bound to be slowed down and 
B 
disturbed spt<cially in an age of economic liberalization 
wherein global players are also- involved as per policy 
decision. [Paras 116 and 117] [847-F-H; 848-A-C] 
2. Although the Courts are expected very often to 
enter into the technical and administrative aspects of the 
C 
matter, it has its own limitations and in consonance with 
the theory and principle of separation o

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