SAROJ SCREENS PVT. LTD. versus GHANSHYAM AND OTHERS

Citation: [2012] 5 S.C.R. 141 · Decided: 26-03-2012 · Supreme Court of India · Bench: G.S. SINGHVI · Disposal: Dismissed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

[2012] 5 S.C.R. 141 
SAROJ SCREENS PVT. LTD. 
v. 
GHANSHYAM AND OTHERS 
(Civil Appeal Nos. 3107- 3108 of 2012) 
MARCH 26, 2012 
[G.S. SINGHVI AND SUDHANSU JYOTI 
MUKHOPADHAYA, JJ.] 
A 
B 
Municipalities - The City of Nagpur Corporation Act, 
1948 - s. 70(5) -Right/interest in public property - Alienation C 
of - Resolution dated 28-8-1991 passed by Municipal 
Corporation of the City of Nagpur for renewal of lease in favour 
of appellant and sanction accorded by the State Government 
u/s. 70(5) - Quashed by the High Court - Validity - Held: 
Resolution passed by the Corporation for renewal of lease in 
D 
favour of appellant and consequential action taken for 
execution of lease deed dated 4-9-1991 were ex facie i/legal 
- High Court did not commit any error by quashing the same 
because, (i) the earlier Resolution dated 29-10-1975 passed 
by the Corporation for renewal of lease in favour of 'P' had 
E 
not been cancelled or rescinded and during subsistence of 
that resolution, neither the Corporation could have renewed 
the lease in favour of the appellant nor the State Government 
could have granted sanction u/s. 70(5) for such renewal; (ii) 
before passing resolution for renewal of lease in favour of the 
F 
appellant, the Corporation did not obtain sanction of the State 
Government, which was sine qua non for any such action/ 
decision; and (iii) the State Government accorded post facto 
sanction for renewal of the lease without realizing that 
alienation of any right or interest in a public property in favour 
G 
of any person without following a procedure consistent with the 
doctrine of equality is impermissible - The Corporation holds 
the property as a trustee of the public and any alienation of 
such property or any right or interest therein otherwise than 
141 
H 
142 
SUPREME COURT REPORTS 
[2012] 5 S.C.R. 
A by way of auction or by inviting bids would amount to breach 
of that trust - Also, the concept of the 'State' has undergone 
drastic change in recent years - Today, the State cannot be 
conceived of simply as a coercive machinery wielding the 
thunderbolt of authority - The Government cannot give or 
B withhold largesse in its arbitrary discretion or according to its 
sweet-will - The Government cannot now say that it will transfer 
the property (land etc.) or will give jobs or enter into contracts 
or issue permits or licences only in favour of certain 
individuals - In the instant case, before granting 30 years' 
c lease of the plot in question in favour of the appellant, the 
Corporation neither issued any advertisement nor followed 
any procedure consistent with the doctrine of equality so as 
to enable the members of the public to participate in the 
process of alienation of public property - Appellant directed 
0 to hand over possession of the plot to the Corporation -
Corporation to alienate the same by sale, lease, or otherwise 
by auction or by inviting tenders and after following a 
procedure consistent with Article 14 of the Constitution -
Constitution of India, 1950 - Article 14. 
E 
The High Court, vide the impugned judgment, 
quashed Resolution dated 28-8-1991 passed by 
Municipal Corporation of the City of Nagpur for renewal 
of lease in favour of the appellant in respect of a plot of 
land as also sanction accorded by the State Government 
F under Section 70(5) of the City of Nagpur Corporation Act, 
1948. The High Court held that during the subsistence of 
an earlier Resolution dated 29-10-1975 in favour of one 
'P', the Municipal Corporation could not have granted 
lease in favour of the appellant and the State Government 
G had no right to validate such grant. 
H 
The question which arose for consideration in the 
instant appeals was whether the High Court committed 
an error by quashing Resolution dated 28.8.1991 passed 
by the Corporation and the sanction accorded by the 
SAROJ SCREENS PVT. LTD. v. GHANSHYAM 
143 
State Government under Section 70(5) of the City of A 
Nagpur Corporation Act, 1948. 
Dismissing the appeals, the Court 
HELD: 1. The resolution passed by the Corporation 
B 
for renewal of lease in favour of the appellant and the 
consequential action taken for the execution of lease 
deed dated 4.9.1991 were ex facie illegal and the High 
Court did not commit any error by quashing the same 
because, (i) Resolution dated 29.10.1975 passed by the 
Corporation for renewal of lease in favour of 'P' for a 
C 
period of 30 years had not been cancelled or rescinded 
and duri

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