THE HON’BLE THE CHIEF JUSTICE UJJAL BHUYAN

AND

THE HON’BLE SRI JUSTICE B.VIJAYSEN REDDY

+ WRIT PETITION (PIL) No.46 of 2019

% 05.06.2023

# Between:

Dr. Urmila Pingle and another

...Petitioners
VERSUS

State of Telangana,
Represented by its Special Chief Secretary,
Revenue Department,
Secretariat Building, Hyderabad,
And others.
...Respondents

! Counsel for the petitioners : Mr. D.Prakash Reddy,

Senior Counsel
representing Mr. Mohammed Omer Farooq

^ Counsel for the State respondents : Mr. B.S.Prasad,

Advocate General

Counsel for respondents No.10 to 12: Mr. S.Niranjan Reddy

Senior Counsel representing
Ms. Rubaina S. Khatoon

<GIST:
 2

> HEAD NOTE:

? Cases referred

1. (1987) 2 SCC 295

2. (1988) 1 SCC 166
3. (1991) 1 SCC 212
4. (1996) 5 SCC 510
5. (2009) 6 SCC 171
6. (2011) 5 SCC 29
7. (2012) 3 SCC 1
8. (2012) 10 SCC 1
9. (2012) 12 SCC 419
10. (2015) 1 SCC 720
11. (2019) SCC OnLine SC 1188
12. (1980) 4 SCC 1
13. (1997) 1 SCC 164
14. (1997) 7 SCC 592
15. (2000) 8 SCC 262
16. (2014) 4 SCC 156
17. (2018) 3 SCC 732
18. 2017 SCC Online Guj 299
19. (2018) 4 SCC 218
20. (2018) 8 SCC 321
21. (2018) 18 SCC 65
22. (2011) 8 SCR 653
 3

THE HON’BLE THE CHIEF JUSTICE UJJAL BHUYAN

AND
THE HON’BLE SRI JUSTICE B.VIJAYSEN REDDY

WRIT PETITION (PIL) No.46 of 2019

ORDER: (Per the Hon’ble the Chief Justice Ujjal Bhuyan)

Heard Mr. D.Prakash Reddy, learned Senior Counsel

representing Mr. Mohammed Omer Farooq, learned

counsel for the petitioners; Mr. B.S.Prasad, learned

Advocate General for the State of Telangana for the State

respondents; and Mr. S.Niranjan Reddy, learned Senior

Counsel representing Ms. Rubaina S. Khatoon, learned

counsel for respondents No.10, 11 and 12.

2. This public interest litigation (PIL) has been filed

assailing the legality and validity of G.O.Ms.No.59 dated

22.03.2018 of the Revenue (Assignment.II) Department,

Government of Telangana as well as Memo dated

02.08.2018 issued by the Special Chief Secretary to

 4

Government of Telangana, Revenue (Assignment.II)

Department.

3. By G.O.Ms.No.59 dated 22.03.2018, Government of

Telangana decided to allot government land to an extent of

Acs.15.00 situated in Survey No.41/14/2 of Khanamet

Village, Serilingampally Mandal in Ranga Reddy District in

favour of M/s.Sai Sindhu Foundation i.e., respondent

No.10, which would also be referred as Sai Sindhu

Foundation, for construction of hospital for cancer and

other life threatening diseases on a non-profit basis on

lease on the same terms and conditions as applicable in

the case of Basavatarakam Cancer Hospital, Hyderabad.

Accordingly, the said government land was ordered for

allotment in favour of Sai Sindhu Foundation. The

allotment has been made subject to certain conditions

contained in G.O.Ms.No.59 dated 22.03.2018 which we will

advert to in the course of the judgment.

 5

4. By Memo dated 02.08.2018, government ordered that

the said land be handed over to Sai Sindhu Foundation,

further requesting the Collector, Ranga Reddy District to

calculate the lease amount per annum duly keeping in view

the present lease amount charged at the rate of

Rs.50,000.00 per annum on 5% increase of lease rent for

every three years as fixed in the case of Basavatarakam

Cancer Hospital.

5. PIL petitioners are Dr. Urmila Pingle and

Mr. Kanagasabai Suresh Kumar. First petitioner is a

medical anthropologist and is a well known activist in the

field of environmental issues and human rights,

particularly tribal rights. She is a member of several

societies and has a number of publications in reputed

journals to her credit. Petitioner No.2 is a Hyderabad

based practicing lawyer.

6. As already mentioned above, the PIL has been filed

assailing the above G.O.Ms.No.59, dated 22.03.2018 and

 6

Memo dated 02.08.2018 whereby it has been alleged that

the State authorities in an unreasonable and arbitrary

manner allotted government land to Sai Sindhu

Foundation at extremely meagre and nominal rates in utter

violation of Government Land Allotment Policy and other

legal provisions and in the process causing huge pecuniary

loss to the State exchequer which has been quantified by

the petitioners at Rs.5,344.6 crores. It is alleged that

valuable land measuring Acs.15.00 located in prime area of

the city has been leased out to Sai Sindhu Foundation for a

period of sixty years for a nominal lease rent of

Rs.1,47,743.00 per annum which, it is alleged, is in direct

contravention of the Government Land Allotment Policy

contained in G.O.Ms.No.571, dated 14.09.2012 as

amended vide G.O.Ms.No.218, dated 01.12.2015.

7. In order to ensure judicious allotment of government

land for public purposes and to ensure uniformity,

G.O.Ms.No.571, dated 14.09.2012, was introduced.

 7

Clause 3(h)(d) of G.O.Ms.No.571 deals with lease rental. It

says that lease rental will be 10% of the prevailing market

value as fixed by the competent authority. The lease rental

shall be revised every five years and re-fixed at 10% of the

prevailing market value as on the date of revision.

8. It is the case of the petitioners that land allotment in

favour of Sai Sindhu Foundation ought to have been

governed by the aforesaid lease rental clause and other

provisions of the Government Land Allotment Policy.

Instead, land has been leased out by the State to Sai

Sindhu Foundation on the same terms and conditions

when government land was allotted to Basavatarakam

Cancer Hospital vide G.O.Ms.No.484 dated 26.05.1989.

The said allotment was made more than thirty years ago

covering land to the extent of Acs.7.35 guntas for an

amount of Rs.50,000.00 per annum for the first three years

to be increased by 5% for every three years thereafter.

Keeping the basis of Rs.50,000.00 per annum for Acs.7.35

 8

guntas of land allotted to Basavatarakam Cancer Hospital

vide G.O.Ms.No.484 dated 26.05.1989, the rental amount

for respondent No.10 i.e., Sai Sindhu Foundation for

Acs.15.00 has been calculated at Rs.1,47,743.00 per

annum by the Collector, Ranga Reddy District. However,

in the final order granting lease in favour of respondent

No.10, there is no mention or reference to G.O.Ms.No.571,

dated 14.09.2012. Had the lease rent been fixed as per

G.O.Ms.No.571 of 2012, the yearly lease rent would itself

have amounted to Rs.50.5 crores from the first year itself.

9. Petitioners have alleged gross arbitrariness and mala

fides in such action of the State. It is contended that land

has been leased out to Sai Sindhu Foundation without

taking into consideration the high market value of land in

the area as on the date of allotment. Market value of the

subject land was ascertained by the Deputy Commissioner

of Ranga Reddy District in the year 2016 by taking into

consideration the following factors: i) Rs.33.70 crores per

 9

acre; ii) Rs.55,000.00 to Rs.60,000.00 per square yard for

residential purposes; and iii) Rs.70,000.00 to Rs.80,000.00

per square yard for commercial purposes. On the above

basis, the entire extent of the land admeasuring Acs.15.00

was valued at Rs.505.50 crores.

10. Special Grade Deputy Collector vide communication

dated 26.08.2016 to the Collector mentioned that the

subject land is in prime locality neary Hitex City and

recommended the land to be valued at Rs.75,000.00 per

square yard keeping in view location of the land.

11. It is stated that the subject land was initially allotted

to Hyderabad Urban Development Authority (HUDA) on

payment of market value at the rate of Rs.12.00 crores per

acre in the year 2008 itself vide G.O.Ms.No.1484 dated

12.12.2008. As the land value has increased significantly

in the last decade, it is estimated that current market value

of the land has significantly increased and has been

 10

estimated at Rs.75,000.00 per square yard by the

department itself totalling to Rs.505.00 crores.

12. However, Government has allotted the land to

respondent No.10 on the same terms as in G.O.Ms.No.484

dated 26.05.1989 i.e., at a rate which was fixed more than

thirty years back. Basic value of the land in 1989 was

Rs.50.00 per square yard. It is stated that G.O.Ms.No.484

dated 26.05.1989 was issued before introduction of the

Government Land Allotment Policy on 14.09.2012 which

was amended vide G.O.Ms.No.218, dated 01.12.2015. It is

contended that government order of 1989 cannot be the

basis for allotment of government land in the year 2018.

13. According to the petitioners, government had

conducted a public auction for sale of land adjacent to the

subject land on 20.04.2016 and as per newspaper report,

price offered was Rs.29.00 crores per acre. But this

procedure was not adopted in the present case. Because of

 11

such action of the government, there has been a huge loss

to the State exchequer.

14. It is stated that Sai Sindhu Foundation i.e.,

respondent No.10 is a Trust which is promoted by

respondent No.11 – Dr. B.Parthasaradhi Reddy, who is the

Chairman of Hetero Group of Companies i.e., respondent

No.12. Though Sai Sindhu Foundation claims to be a

charitable trust, it has no prior experience of any such

charitable activities, not to speak of establishing any

charitable hospital. Respondent No.12 i.e., Hetero Group

of Companies is engaged in the business of production and

marketing of medicines and has no experience of

establishing or managing any hospital, leave alone any

charitable hospital.

15. It is alleged that Hetero Group of Companies is one of

the accused in RC.No.19(A)/2011-CBI, Hyderabad in which

case, Central Bureau of Investigation (CBI) has filed charge

sheet before the Special CBI Court. Upon cognizance being

 12

taken, C.C.No.8 of 2012 has been registered which case is

now at the stage of trial. Enforcement Directorate has also

registered a case bearing No.ECIR No.09/OSZO/2011

against Hetero Group of Companies under the provisions of

the Prevention of Money Laundering Act, 2002. There also

Enforcement Directorate has filed charge sheet before the

learned Metropolitan Sessions Judge, Hyderabad and upon

cognizance being taken, Sessions Case No.92 of 2016 has

been registered.

16. Petitioners have alleged that impugned G.O.Ms.No.59

dated 22.03.2018 was issued without any advertisement or

public notice. There was no auction of the subject land.

Petitioners have questioned the opaque exercise

undertaken by the respondents in granting State’s largesse

to a private body without calling for any competitive

bidding. It is contended that such action amounted to

violation of Article 14 of the Constitution of India.

 13

17. How the loss has been caused to the State exchequer

has been explained by the petitioners in the form of two

statements in paragraphs 21 and 22 of the writ affidavit.

According to the petitioners, if the lease rentals are

calculated on the basis of G.O.Ms.No.571, dated

14.09.2012, the total rental value for the sixty years of

lease would be Rs.5,346.07 crores. The said figure has

been arrived at in the following manner:

Block Period as per Land Lease Rents as per Govt. Land

Allotment Policy, 2012 Allotment Policy, 2012 (land
cost being at a minimum of
Rs.500 crores) @ 10%
enhancement for every block of
5 years
(Rs.in crores)

01-05 years 250.00

06-10 years 275.00
11-15 years 302.50
16-20 years 332.75
21-25 years 366.03
26-30 years 402.63
31-35 years 442.89
36-40 years 487.18
41-45 years 535.90
46-50 years 589.49
51-55 years 648.44
56-60 years 713.28

Total Rental Value Rs.5346.07 Crores

 14

18. In contrast to the above, petitioners have worked out

the total lease rental of the subject land for sixty years as

per the rent fixed by G.O.Ms.No.59 dated 22.03.2018 as

per which the total rental value comes to Rs.146.8 lakhs

i.e., approximately Rs.1.47 crores. The above estimate has

been arrived at by the petitioners in the following manner:

Block Period as per the Lease Rents as per the

impugned G.O.Ms.No.59 – impugned order in which for
3 years every block of 3 years,
enhancement is 5%
(Rs.in Lakhs approximately)

01-03 years 4.44

04-06 years. 4.66
07-09 years 4.89
10-12 years 5.14
13-15 years 5.40
16-18 years 5.67
19-21 years 5.95
22-24 years 6.25
25-27 years 6.56
28-30 years 6.89
31-33 years 7.23
34-36 years 7.59
37-39 years 7.97
40-42 years 8.37
43-45 years 8.79
46-48 years 9.23
49-51 years 9.69
52-54 years 10.18
55-57 years 10.68
58-60 years 11.22

Total Rental Value Rs.146.8 Lakhs

 15

(i.e., approx 1.47 crores)

19. From this it is evident that the State has actually

suffered financial loss of about Rs.5,344.6 crores

(Rs.5,346.07 crores – Rs.1.47 crores).

20. Such action of the State amounts to virtually handing

over of prime land to private entities at great loss to the

public exchequer. Impugned action is not only arbitrary

but reeks of favouritism.

21. It is stated that District Collector of Ranga Reddy

District had carried out a reassessment of the need for

allotting such large extent of government land to private

parties and thereafter put forth a revised proposal for

allotment of Acs.10.00 of land to respondent No.10 instead

of Acs.15.00 of land vide communication dated

29.10.2017. Following a meeting of Telangana State Land

Management Authority on 21.12.2017 and on the basis of

the revised proposal of the District Collector, respondent

No.2 had written a letter to respondent No.1 to pass

 16

suitable order(s) for allotment of Acs.10.00 of land in

favour of respondent No.10 for establishment of cancer

hospital on lease basis. However, despite such suggestion

by respondent No.2 to allot only Acs.10.00, respondent

No.1 arbitrarily allotted Acs.15.00 of land to respondent

No.10. It is further stated that not only a larger extent of

land was allotted to respondent No.10, the latter was given

the benefit of a different plot of equivalent land (from Map-

B to Map-C) so much so that respondent No.10 was

allotted land facing the road which is, therefore, more

valuable.

22. Petitioners have alleged that establishment of Trust

and setting up of charitable hospital is nothing but a cover

up to justify illegal allotment of prime government land,

that too, in an arbitrary and discriminatory manner, to

respondent No.10.
 17

23. In the above factual backdrop, petitioners have

prayed for quashing of G.O.Ms.No.59, dated 22.03.2018,

as well as Memo dated 02.08.2018.

24. This court by order dated 29.04.2019 had issued

notice and as an interim measure, clarified that any lease

granted to respondent No.10 and any construction raised

by respondents No.10, 11 and 12 thereon shall be subject

to the decision of this court. Further, respondents No.10,

11 and 12 have been injuncted from creating any third

party right during the pendency of the writ petition.

25. It appears that two more public interest litigations

were filed on the same subject matter being W.P

(PIL).Nos.141 and 144 of 2019. All the three public

interest litigations were heard together on 11.02.2021,

whereafter the following order came to be passed:

1. Pleadings are complete in all the three petitions

viz., W.P (PIL) Nos.144, 46 and 141 of 2019.
 18

2. The grievance of the petitioners in all the three

petitions is common, which is for declaring the action of
the respondent No.1/State in issuing G.O.Ms.No.59
dated 22.03.2018 and Memo dated 02.08.2018,
directing land to the extent of Acs.15.00 to be handed
over to the respondent No.10 @ Rs.1,47,000/- per year
for a period of 33 years, as illegal and arbitrary.

3. With the consent of the parties, W.P. (PIL) No.46

of 2019 shall be treated as the lead matter for purposes
of arguments. Interim order has already been passed in
the said petition clarifying that the lease granted to the
respondent No.10 and any construction raised by the
respondents No.10 to 12 shall be subject to the outcome
of the petition and further, the said respondents have
been restrained from creating third party rights during
the pendency of the petition. The construction is stated
to be ongoing. The said order shall continue to operate
during the pendency of the present petition.

26. Thus, it is seen that it was brought to the notice of

this court that construction was going on and in the face of

such submission, this court clarified that interim order

passed earlier would continue to operate during the

pendency of the writ petition. It was also mentioned that

 19

W.P (PIL).No.46 of 2019 would be treated as the lead

matter.

27. However, by a separate order dated 11.02.2021 this

court took the view that since the issue raised in all the

public interest litigations was common, there was no

reason to duplicate the matters. While retaining W.P

(PIL).No.46 of 2019 on board, the other two public interest

litigations, being W.P (PIL).Nos.141 and 144 of 2019 were

disposed of along with the pending applications.

Nonetheless, liberty was granted to learned counsel for the

petitioners in those two public interest litigations to assist

the court.

28. It was thereafter that I.A.No.2 of 2021 was filed in

W.P (PIL).No.141 of 2019 for recall of the aforesaid order

and to hear W.P (PIL).No.141 of 2019 along with W.P

(PIL).No.46 of 2019. However, without recalling the order

dated 11.02.2021, we have allowed learned counsel

 20

representing the applicant to intervene in the proceedings

of W.P (PIL).No.46 of 2019.

29. Respondent No.1 has filed counter affidavit through

the Special Chief Secretary – Sri Rajeshwar Tiwari.

Respondent No.1 has stated that the public interest

litigation filed is completely misconceived, being not based

on any foundational research.

29.1. Formulation and implementation of any economic

policy is the responsibility of the executive, the merit of

which is not subject to judicial review, except on the

ground of constitutional infirmities. Executive is entitled to

take legitimate factors into consideration for the interest of

the public and for good governance. Except for the bald

assertion that impugned proceedings in favour of

respondent No.10 are in violation of Government Land

Allotment Policy, petitioners have not placed any relevant

materials for this court to interfere in what is contended to

be a legitimate government decision.

 21

29.2. According to respondent No.1, sole plank of the

petitioners is economic loss to the State Government while

granting lease in favour of respondent No.10. Petitioners

have conveniently ignored the fact that the impugned

government order has to be read in totality. If it is read as

a whole, it would be evident that land has been allotted to

respondent No.10 for setting up of a health institution

where health care would be provided free of cost to 25% of

the inpatients and 40% of the outpatients belonging to

economically weaker sections of the society. That apart,

25% discount would be provided to all inpatients while

availing benefit of government schemes like, Aarogya Sree

and Employees Health Scheme.

29.3. Government has framed Government Land

Allotment Policy vide G.O.Ms.No.571, dated 14.09.2012,

for allotment of government land to different government

departments and private organisations for various

purposes. As per the said policy, Dr. B.Parthasarathi

 22

Reddy, Chairman of Hetero Group of Companies who is

also the Managing Trustee of Sai Sindhu Foundation had

filed a representation before the Government requesting

allotment of land to an extent of Acs.15.48 guntas on lease

basis in favour of Sai Sindhu Foundation for fulfilling the

objectives of the Trust. In the said representation it was

pointed out that 25% of the beds in the health institute

proposed to be constructed on the allotted land would be

free of charge for the poor people; besides 40% of the

outpatients would also be treated free of charge. Collector

of Ranga Reddy District had submitted proposal for

alienation of land to an extent of Acs.15.00 situated in

Survey No.41/14/2 of Khanamet Village, Serilingampally

Mandal in Ranga Reddy District in favour of Sai Sindhu

Foundation for establishment of cancer hospital on

payment of Rs.75,000.00 per square yard. The said

proposal was placed before the Telangana State Land

Management Authority on 21.12.2017. The said authority

had recommended the proposal to the government for

 23

allotment of the subject land in favour of Sai Sindhu

Foundation on lease basis on payment of lease rental as

per the conditions stipulated in G.O.Ms.No.571 dated

14.09.2012 read with G.O.Ms.No.218 dated 01.12.2015 of

the Revenue Department specifically for establishment of

cancer hospital and not for any other purposes.

Government after examining the entire issue and with

reference to resolution No.638/2018 of the Council of

Ministers dated 14.03.2018 issued orders in

G.O.Ms.No.59, dated 22.03.2018.

29.4. It is stated that Government has not alienated the

said land in favour of Sai Sindhu Foundation but has

allotted the same on lease basis only. Therefore, in

G.O.Ms.No.59 dated 22.03.2018 Government has granted

lease of the said land in favour of Sai Sindhu Foundation

for a period of thirty years. Thereafter, orders were issued

vide Memo dated 02.08.2018 for handing over the said

land to Sai Sindhu Foundation. It is stated that the

 24

allotted land was changed from the one proposed by the

Collector, Ranga Reddy, and instead, equivalent land was

allotted to Sai Sindhu Foundation in the same locality,

other conditions remaining the same.

29.5. Reference has been made to G.O.Ms.No.484, dated

26.05.1989 whereby land admeasuring Acs.7.35 guntas

situated at Shaikpet Village, Golconda Mandal, Hyderabad

District was leased out in favour of Smt. Nandamuri

Basava Taraka Rama Rao Memorial Cancer Foundation,

subject to the following conditions:

(i) The lease period shall be initially for 30 (thirty)

years renewable for another period of 30 (thirty)
years;

(ii) The lease amount shall be Rs.50,000/- per

annum for the first three years and there shall be
a 5% increase in the lease rental thereafter for
every three years till the end of the lease period;

(iii) 25% of the beds shall be free to the poor;

 25

(iv) 40% of the out-patients shall be treated free of

cost; and

(v) The building shall be completed in two years from

the date of putting the Cancer Foundation in
possession of the land.

29.6. Akin to the above request and consequential

allotment, Sai Sindhu Foundation had made a

representation before the government. After following the

procedure laid down in G.O.Ms.No.571, dated 14.09.2012,

the proposal was examined and following decision of the

Council of Ministers dated 14.03.2018, government issued

G.O.Ms.No.59, dated 22.03.2018, allotting government

land to the extent of Acs.15.00 situated in Survey

No.41/14/2 of Khanamet Village, Serilingampally Mandal,

Ranga Reddy District, in favour of Sai Sindhu Foundation

for construction of hospital for cancer and other life

threatening diseases. The allotment was made on lease

basis on similar terms as per allotment made to

Basavatarakam Cancer Hospital, though certain additional

conditions have been added. Thus, land has been allotted

 26

to Sai Sindhu Foundation, subject to the following

conditions:

i. The lease period shall be initially for thirty (30)

years, renewable for another period of thirty (30)
years.

ii. The lease amount shall be collected as per the rate

in G.O.Ms.No.484, Revenue (Assn.III) Department,
dt:26.05.1989, wherein, lease amount was fixed for
Basavatarakam Cancer Hospital, for the first three
(3) years and there shall be a 5% increase in the
lease rental thereafter for every three (3) years till
the end of the lease period.

iii. 25% of the "In Patients (IP)", who are the poor
people, shall be treated free of cost.

iv. 40% of Out-Patients (OP), who are poor, shall be

treated free of cost.

v. 25% discount shall be given in each bill for all In-

patients (IP), admitted under all Government
sponsored schemes like Aarogyasree, Employees
Health Scheme etc.

vi. The lease rent shall be paid by the lessee per

annum as fixed above and before January 10th of
every year and the same shall be remitted in the
 27

Government Treasury through proper Head of

Account.

vii. Hospital Building shall be completed within two (2)

years from the date of putting the foundation in
possession of the land.

viii. The primary responsibility of monitoring and

utilization of government land allotted to various
organizations vest with the concerned Departments.
Hence, the Director of Health shall ensure the
development of land, management agreements and
progress of implementation of project and also to
monitor the utilization of land.

ix. No mortgage of the land without the prior approval

of Government.

x. The management of proposed hospital shall submit

a monthly report to the Director of Health and the
Collector, Ranga Reddy district, with the details of
"In Patients (IP) and Out Patients (OP)", who have
been treated freely under the above conditions,
failing which, the District Collector shall call for
explanation, if he is not satisfied, he shall initiate
proceedings for resumption of the land.

xi. The land shall be used for the purpose, for which it
is allotted and not for any other purposes.
 28

xii. Any violation of the said conditions will

automatically cancel the lease and the said land will
be reverted back to the Collector, Ranga Reddy
District, without any prior notice thereof.

xiii. Other usual conditions laid under BSO-23 &

utilization of land as per BSO-24, are applicable;

29.7. Reference has been made to the Government Land

Allotment Policy contained in G.O.Ms.No.571, dated

14.09.2012, whereby certain norms have been fixed for

allotment of government land as under:

(i) While fixing the cost of land to be charged, the

general principles laid down in BSO-24, which take
into consideration the purpose of allotment and the
nature of the organization shall be followed. The
provisions of BSO-24 shall apply to all the land
allotments along with the conditions stipulated by
the alienating agencies/ departments.

(ii) The allotment/ alienation shall be on market value

as recommended by the Collector, and the TSLMA.

(iii) Market value should be ascertained by conducting

local enquiry. However the land value shall not be
less than the basic value of the land.
 29

The following officers of Revenue Department shall be

competent for recommending market value within the
limits shown below.

Officer Market value

Revenue Divisional Officer Total land value upto

Rs.1.00 Crore

Collector Total land value above

Rs.1.00 Crore

(iv) The Government land may be given free of costs to

State Government departments for welfare and
development purposes. Lands for houses for Below
Poverty Line families may also given free of cost.

(v) The Department of the Government may formulate

and notify, appropriate concessional policies for the
promotion of their respective sector, which inter alia,
may include concessional rate of land for sale or
lease. It shall be incumbent on the administrative
department to ensure compliance with such
conditions.

29.8. Thus Revenue Divisional Officer would be competent

for recommending market value of land where the total

 30

land value is up to Rs.1.00 crore; but where the total land

value is above Rs.1.00 crore, it is the Collector who is

competent for recommending the market value.

29.9. In respect of lease rental, G.O.Ms.No.571 dated

14.09.2012 was amended in G.O.Ms.No.218, dated

01.12.2015. As per the amendment, the lease rental would

be 10% of the prevailing market value per annum as fixed

by the competent authority and would be revised after

every five years. It would be refixed at 10% of the

prevailing market value as on the date of revision.

29.10. Respondent No.1 has stated that keeping in view

the larger objective of the Foundation to set up a tertiary

medicare centre of excellence with the state of the art world

class infrastructure, attended by world renowned doctors,

cutting edge sophisticated equipments and advanced

technology to cover research, training on cancer and other

life threatening diseases management at Hyderabad and

further keeping in view the objective of the Foundation to

 31

ensure that 25% of the beds would be free of charge for the

poor people, besides treating 40% of the outpatients free of

charge, government issued G.O.Ms.No.59, dated

22.03.2018 for allotment of subject land in favour of Sai

Sindhu Foundation on lease basis for construction of

hospital for cancer and other life threatening diseases on

non-profit basis, subject to the conditions already

mentioned above.

29.11. Further, on clarification sought for by the Collector

of Ranga Reddy District as to fixation of lease rent,

government has issued Memo dated 11.01.2019 agreeing

to the proposal of the Collector to fix the lease rental at

Rs.1,47,743.00 per annum for the first three years with

provision for 5% increase in the lease rent thereafter for

every three years till the end of the lease period.

Conditions for allotment of land to Sai Sindhu Foundation

are similar to the conditions governing allotment of land to

Basavatarakam Cancer Hospital.

 32

29.12. Respondent No.1 has clarified that though in

G.O.Ms.No.59, dated 22.03.2018, there is no mention of

G.O.Ms.No.571, dated 14.09.2012, in fact, the procedure

laid down in G.O.Ms.No.571, dated 14.09.2012, has been

followed in the case of Sai Sindhu Foundation. Non

mentioning of G.O.Ms.No.571, dated 14.09.2012 in

G.O.Ms.No.59, dated 22.03.2018, would not vitiate

allotment of land to Sai Sindhu Foundation.

29.13. Though Collector of Ranga Reddy District had

submitted prevailing market value of the said land at the

rate of Rs.75,000/- per square yard, keeping in view

objectives of the Sai Sindhu Foundation, government has

issued G.O.Ms.No.59, dated 22.03.2018, allotting the said

land to the foundation on lease basis for thirty years on the

same condition of lease allotted to Basavatarakam Cancer

Hospital vide G.O.Ms.No.484, dated 26.05.1989, with

provision for increase of lease rental after every three years

at the rate of 5%. In order to protect government land and

 33

public interest, government did not allow Sai Sindhu

Foundation to outrightly purchase the said land, but

allotted the same on lease basis.

29.14. It is stated that out of Acs. 180.13 guntas of

government land in Survey No.41/14, an extent of

Acs.75.00 was handed over to Andhra Pradesh Industrial

Infrastructure Corporation (now Telangana State Industrial

Infrastructure Corporation) on 12.11.1997 vide

G.O.Ms.No.411, dated 28.07.2000. That apart, land to the

extent of Acs.105.13 guntas was handed over to Hyderabad

Metropolitan Development Authority (HMDA) (erstwhile

HUDA) on 22.04.2008. The above allotment was made vide

G.O.Ms.No.1484, dated 12.12.2008, on payment of market

value at the rate of Rs.12.00 crores per acre. After

allotment to various agencies/organisations, land to an

extent of Acs.63.20 guntas was available with Telangana

State Industrial Infrastructure Corporation and land to the

extent of Acs.62.24 guntas was available with HMDA in

 34

Survey No.41/14 of Khanamet Village. However,

government vide Memo dated 23.04.2016 had directed

resumption of government land to the extent of Acs.63.20

guntas in Survey No.41/14 of Khanamet Village,

Serilingampally Mandal, from Telangana State Industrial

Infrastructure Corporation and land to the extent of

Acs.62.24 guntas in Survey No.41/14 of Khanamet Village,

Serilingampally Mandal, from HMDA for violation of

allotment conditions. Upon resumption of land,

government issued Memo dated 23.04.2016 and

G.O.Ms.No.65, dated 23.04.2016, according permission for

sale of such land through e-auction-cum-e-tender. When

the proposal for allotment of land in favour of Sai Sindhu

Foundation was received, the same was placed before the

Telangana State Land Management Authority on

21.12.2017. Telangana State Land Management Authority

recommended to the government for allotment of land in

favour of Sai Sindhu Foundation on lease basis on

payment of lease rental as per conditions stipulated in

 35

G.O.Ms.No.571, dated 14.09.2012, read with

G.O.Ms.No.218, dated 01.12.2015, specifically for

establishment of cancer hospital and not for any other

purposes. Government considered the proposal vide the

meeting of the Council of Ministers on 14.03.2018

whereafter impugned G.O.Ms.No59, dated 22.03.2018, was

issued on the same terms and conditions on which land

was earlier allotted to Basavatarakam Cancer Hospital.

29.15. Insofar Sai Sindhu Foundation is concerned, it is a

public charitable trust set up in the year 2014 by

Dr. B.Parthasaradhi Reddy, who is the Managing Trustee

of the foundation and Chairman of Hetero Group of

Companies, which is a leading pharmaceutical enterprise

in India engaged in the business of manufacturing and

marketing of life saving medicines with an annual turnover

of about $ 1.00 billion and employing more than fifteen

thousand personnel. Object of the foundation is to set up a

tertiary medicare centre of excellence with the state of art

 36

world class infrastructure in Hyderabad. Dr. Nori.D, an

internationally reputed cancer specialist born and brought

up in Hyderabad, but now based in New York and many

other world renowned doctors have agreed to extend their

services to the hospital.

29.16. Amongst other conditions imposed by the

Government while allotting the land to Sai Sindhu

Foundation, it has also been imposed that the hospital

building should be completed within two years from the

date of putting the foundation in possession of the land;

management of the proposed hospital shall submit a

monthly report to the Director of Health and Collector of

Ranga Reddy District the details of inpatients and

outpatients who have been treated free of cost by the

hospital; the land shall be used for the purpose for which it

has been allotted and not for any other purpose.

29.17. State Government has justified the above decision

by contending that the land has been allotted for setting up

 37

of a world class cancer hospital to serve the poor people.

Therefore, there can be no commercial consideration for

allotment of such land.

29.18. It is also asserted that as per G.O.Ms.No.571, dated

14.09.2012 there was no need to call for tenders for

allotment of government land on lease basis to any private

organisation. As per procedure laid down in the said

government order, Sai Sindhu Foundation had submitted a

representation seeking allotment of the subject land to

them. This request was processed whereafter Collector of

Ranga Reddy District submitted proposal which in turn

was considered by the Telangana State Land Management

Authority whereafter the proposal was forwarded to the

government. It was after examining the proposal that

impugned G.O.Ms.No.59, dated 22.03.2018, was issued.

29.19. It is admitted by the State Government that

Collector of Ranga Reddy District had submitted revised

proposal for allotment of land to an extent of Acs.10.00

 38

instead of Acs.15.00 to Sai Sindhu Foundation on lease

basis on payment of prevailing market value at the rate of

Rs.75,000.00 per square yard. Chief Secretary as well the

Chief Commissioner of Land Administration, Telangana

and Telangana State Land Management Authority had

recommended the said proposal. However, keeping the

commitment given by Dr. B.Parthasaradhi Reddy,

government had taken the decision in the meeting of the

Council of Ministers held on 14.03.2018 to allot the subject

land in favour of Sai Sindhu Foundation on lease basis on

the same terms and conditions as applicable in case of

Basavatarakam Cancer Hospital. However, G.O.Ms.No.59,

dated 22.03.2018, was kept internal, though the same was

communicated to the concerned authorities.

29.20. Collector of Ranga Reddy District in his letter dated

07.06.2018 informed the government that Trustee of Sai

Sindhu Foundation had filed a representation dated

04.04.2018 requesting to change the orientation of

 39

Acs.15.00 of land by giving certain reasons. After

considering the proposal, Collector of Ranga Reddy District

requested the Government to accord permission for

handing over of equivalent extent of land to Sai Sindhu

Foundation as per Map-C instead of Map-B. There is no

change in the area of the land, except alignment in the

map. This was accepted by the Government whereafter

orders were issued on 02.08.2018 for handing over the

land to Sai Sindhu Foundation.

29.21. Justifying the action of the State Government, the

counter affidavit seeks dismissal of the writ petition.

30. Respondents No.10 and 11 have filed counter

affidavit through Dr. B.Parthasaradhi Reddy i.e.,

respondent No.11 who is also the Managing Trustee of

respondent No.10 i.e., Sai Sindhu Foundation. He has

referred to his rich experience in pharmaceutical industry

and also about his status as founder chairman of the

Hetero Group of Companies which is one of the largest

 40

pharmaceutical companies in the country and is a world

leader in the production of anti-retroviral drugs meant for

the treatment of HIV/AIDS. Both respondents No.11 and

12 have initiated several programmes for the benefit of

society as part of corporate social responsibility. Sai

Sindhu Foundation was constituted by respondent No.11

as a Trust after the tragic and untimely death of his

daughter at a relatively young age of 35 years. It is in her

memory and to render public service that Sai Sindhu

Foundation was constituted as a charitable Trust by

respondent No.11 which is supported by well wishers and

benefactors, including respondent No.12.

30.1. It is stated that respondent No.10 - Sai Sindhu

Foundation, is a non-profitable Trust and the hospital

which is being established is not a commercial venture but

is aimed solely at providing world class medical care to

cancer patients belonging to all sections of the society. It is

stated that cancer in its many forms has become one of the
 41

most dreaded and medically complex problems. According

to World Health Organisation, cancer is the second leading

cause of deaths globally and in 2018, it was responsible for

an estimated death of 9.6 million people. Approximately

70% of deaths from cancer occur in low and middle income

countries due to unaffordable cancer treatment. Insofar

India is concerned, there are about 2.25 million people

having been afflicted with cancer. Due to lack of affordable

cancer facilities, large number of people detected with

cancer die in our country. There are only 400 cancer care

centres in India out of which 260 are owned and operated

by private sector. Only about 20% of the cancer patients

population can afford to avail treatment in private

hospitals because of prohibitive prices. Remaining 80%

are treated in government hospitals. There is need to raise

additional 1,60,000 hospital beds in order to provide

affordable cancer treatment to the people.

 42

30.2. National Health Policy, 2017 envisages the need for

collaboration and partnership with non-profit organisations

and advocates building synergy with non-profit

organisations.

30.3. Realising the deficiencies in cancer treatment several

State Governments have taken initiatives to set up cancer

hospitals in collaboration or partnership with private

entities. Another major problem in India relating to cancer

treatment is scarcity of qualified doctors to treat cancer

patients. As per official data, there are only about 1000

trained oncologists in the country. Ratio of oncologists to

cancer patients is about 1:2000.

30.4. Insofar State of Telangana is concerned, there are 25

comprehensive cancer centres out of which only three are

government run institutions: MNJ Institute of Oncology,

Nizam Institute of Medical Sciences (NIMS) and KMC,

Warangal. Rest of the cancer centres are owned and

operated privately which are naturally expensive. The

 43

affidavit says that there are approximately 58,000 new

cancer cases every year in the State of Telangana. Both

government run institutions and private run institutions

are inadequate to treat the ever increasing number of

cancer patients. Therefore, there is need to increase the

number of affordable cancer treatment centres in the State

of Telangana.

30.5. It is in the above backdrop that it was decided that

Sai Sindhu Foundation could provide medical assistance to

support the public health care system in the State of

Telangana in the field of cancer and other life threatening

diseases. Untimely death of the daughter of respondent

No.11 added to the need for taking up such a venture.

After visiting many reputed cancer hospitals in India and

abroad and after holding widespread discussions with

experts, respondent No.10 i.e., Sai Sindhu Foundation

decided to establish a world class hospital for treatment of

cancer and other life threatening diseases in Hyderabad.

 44

30.6. With the prices of urban land skyrocketing,

establishment of any hospital in areas having proximity to

urban centres would require huge capital outlay. Having

regard to the policies of the State Government and having

regard to the decision of Sai Sindhu Foundation in

proposing to set up a cancer hospital as a non-profit

charitable institution, it was decided to seek allotment of

land from the Government of Telangana.

30.7. Reference has been made to Section 25 of the Andhra

Pradesh (Telangana Area) Land Revenue Act, 1317 Fasli,

which provides for allotment of land for any suitable public

purpose. Reference has also been made to the Government

Land Allotment Policy adopted by the Government of

Telangana vide G.O.Ms.No.571, dated 14.09.2012. It is

stated that in case of land allotment to a trust, the

proposal for allotment should come through the Telangana

State Land Management Authority.

 45

30.8. Respondent No.10 i.e., Sai Sindhu Foundation

submitted representation to respondent No.1 on

20.08.2015 and 02.04.2016 requesting for allotment of

land to an extent of Acs.15.48 guntas in Serilingampally

Mandal on lease basis for construction of hospital for

cancer and other life threatening diseases and also for

setting up of a medicare centre. Respondent No.10

assured the State Government that 25% of the beds would

also be free of charge for the poor and 40% of the

outpatients would be treated free of charge. While

respondent No.10 would continue to be a non-profit

organisation, the remaining patients would be charged on

cost basis so that the hospital as well as the Trust could

sustain themselves.

30.9. In accordance with the Government Land Allotment

Policy, Collector of Ranga Reddy District submitted

proposal dated 23.09.2016 to the Chief Commissioner of

Land Administration recommending allotment of land to

 46

respondent No.10 i.e., Sai Sindhu Foundation. Chief

Commissioner of Land Administration scrutinised the

proposal and placed the same before the Telangana State

Land Management Authority. Telangana State Land

Management Authority in its meeting held on 04.04.2017

recommended allotment of land to Sai Sindhu Foundation

on lease rental basis.

30.10. Complying with the request of Chief Commissioner

of Land Administration, Collector of Ranga Reddy District

submitted proposal on 03.05.2017 regarding leasing out of

land to Sai Sindhu Foundation for establishing a cancer

hospital. On 15.05.2017, Chief Commissioner of Land

Administration forwarded the recommendations of

Telangana State Land Management Authority to

respondent No.1 for issuance of appropriate order.

30.11. On 03.06.2017, respondent No.1 called upon the

Chief Commissioner of Land Administration to collect

details relating to the cancer hospital proposed to be set up

 47

by Sai Sindhu Foundation. Respondent No.10 i.e., Sai

Sindhu Foundation thereafter submitted project report on

09.06.2017 relating to establishment of a cancer hospital.

Chief Commissioner of Land Administration vide letter

dated 01.07.2017 forwarded the project report to

respondent No.1 and requested respondent No.1 to take a

decision on allotment of land to respondent No.10.

Respondent No.1 vide Memo dated 22.07.2017 had

requested Chief Commissioner of Land Administration to

submit a report providing details of the basic value of land

situated in Survey No.41/14/2 of Khanamet Village,

Serilingampally Mandal, Ranga Reddy District.

30.12. Respondent No.1 and Chief Commissioner of Land

Administration requested the Collector of Ranga Reddy

District on 23.08.2017 and again on 08.10.2017 to submit

a revised proposal for allotment of land to an extent of

Acs.10.00 instead of Acs.15.00 to respondent No.10.

Following the same, Collector of Ranga Reddy District

 48

submitted revised proposal for allotment of Acs.10.00 of

land to Chief Commissioner of Land Administration. Chief

Commissioner of Land Administration thereafter placed the

revised proposal of the Collector before Telangana State

Land Management Authority on 29.10.2017. After detailed

deliberation, Telangana State Land Management Authority

approved the revised proposal on 21.12.2017 and

submitted the same to respondent No.1 for approval.

30.13. After examining the recommendations of Telangana

State Land Management Authority and other concerned

departments, Council of Ministers for the State of

Telangana decided to allot land admeasuring Acs.15.00 by

resolution dated 14.03.2018. This was followed by

issuance of G.O.Ms.No.59 dated 22.03.2018 allotting land

admeasuring Acs.15.00 situated in Survey No.41/14/2 of

Khanamet Village, Serilingampally Mandal in Ranga Reddy

District to respondent No.10 i.e., Sai Sindhu Foundation.

 49

While allotting the land, Government stipulated the

following conditions for compliance by respondent No.10:

• That 25% “in-patients” (IP) who are poor shall be

treated free of cost;
• 40% of “out-patients” (OP) who are poor shall be
treated free of cost;
• 25% discount shall be given in each bill for all in-
patients admitted under all Government sponsored
schemes like Arogya Sree, Employees Health
Scheme etc.

30.14. That apart, other conditions were also imposed like

completion of hospital building within two years from the

date of taking over possession of the land; monitoring of

utilisation of the government land by the concerned

department; submission of monthly report by respondent

No.10 to the Director of Medical Health and District

Collector, Ranga Reddy District, by forwarding details of

inpatients and outpatients who have been treated free

under government schemes. Accordingly, respondent No.1

issued G.O.Ms.No.59 dated 22.03.2018 allotting land to

 50

the extent of Acs.15.00 in Survey No.41/14/2 of Khanamet

Village, Serilingampally Mandal in Ranga Reddy District.

As a follow up measure, Collector, Ranga Reddy District

directed the Deputy Collector on 31.03.2018 to handover

possession of the allotted land to respondent No.10 i.e., Sai

Sindhu Foundation.

30.15. Sai Sindhu Foundation made a representation dated

04.04.2018 requesting the government for change in the

orientation of the land allotted so that maximum space

could be utilised for construction of hospital. Collector of

Ranga Reddy District wrote two letters dated 14.04.2018

and 07.06.2018 to respondent No.1. By the first letter, he

sought for clarification regarding the lease amount to be

paid by respondent No.10 i.e., Sai Sindhu Foundation. By

the second letter, he sought for approval of respondent

No.1 to handover land with the changed orientation to Sai

Sindhu Foundation. By Memo dated 02.08.2018,

respondent No.1 approved reorientation of the land and

 51

also clarified the lease amount to be collected from Sai

Sindhu Foundation. It was thereafter that Collector

directed the Deputy Collector and Tahsildar on 03.08.2018

to handover possession of the reoriented land to

respondent No.10 i.e., Sai Sindhu Foundation following

which the latter took over physical possession of the land

on 06.08.2018.

30.16. Collector of Ranga Reddy District calculated the

lease amount payable by Sai Sindhu Foundation on the

basis of G.O.Ms.No.484, dated 26.05.1989, whereby land

was allotted to Basavatarakam Cancer Hospital and arrived

at an annual lease amount of Rs.1,47,743.00 to be paid by

Sai Sindhu Foundation. This was confirmed by respondent

No.1 on 11.01.2019. Respondents No.10 and 11 have

asserted that the entire exercise leading to allotment of

land to respondent No.10 for the purpose of establishing

the cancer hospital is completely in consonance with public

policy and accords with the constitutional goals and

 52

directives set out for the State. The allotment is not for any

entrepreneurial activity or for any commercial undertaking.

The allotment favours establishment of better medical care

facilities in the State by encouraging private philanthropy

for public objectives.

30.17. Respondents No.10 and 11 have also contended

that petitioners have no locus or any right to question a

policy decision of the government. It is further stated that

financial consideration is not always the sole criteria in any

endeavour of the State Government. Because of the

philanthropic nature of the project, concessional lease

rentals were fixed which received the approval of the

Cabinet.

30.18. Respondent No.10 has promised to provide for

1080 beds in the proposed hospital in two phases, the first

phase providing for 575 beds approximately. That apart,

the hospital is being built conforming to the guidelines of

National Board of Hospital Accreditation. The hospital

 53

would evolve into an integrated health centre and there

would be a Dharamshala also to provide subsidised

accommodation to the patients and their attendants.

30.19. Denying all the allegations made by the petitioners,

respondents No.10 and 11 seek dismissal of the writ

petition.

31. Respondent No.12 has filed a separate counter

affidavit. Stand taken in the counter affidavit is that

respondent No.11 is the founder chairman of respondent

No.12. Respondent No.11 has nurtured respondent No.12

in such a manner that today it has emerged as one of the

leading pharmaceutical companies in the world providing

direct and indirect employment to about 20,000 people. It

is the pioneer in the production of anti-retroviral drugs

that are meant for the treatment of HIV/AIDS. Respondent

No.12 led by respondent No.11 have initiated several

beneficial programmes for the public under its corporate

social responsibility initiatives.

 54

31.1. Respondent No.12 is in no way concerned with the

allotment of land in favour of respondent No.10 which is a

public charitable trust. Respondent No.12 will not use any

portion of the subject land allotted to respondent No.10.

31.2. While acknowledging that respondent No.12 was

allotted Acs.75.00 of land in Special Economic Zone of

Jadcherla, where respondent No.12 has established

pharmaceutical units by investing about Rs.1,100.00

crores and providing employment, direct and indirect, to

about 2000 people, the other allegations made by the

petitioners have been denied.

31.3. It is clarified that respondent No.12 is not engaged

either in the construction or management of the proposed

cancer hospital by respondent No.10. Entire construction

and management will be undertaken by respondent No.10.

Therefore, petitioners have erroneously impleaded Hetero

Group of Companies as respondent No.12 in the writ

 55

petition. Respondent No.12 is not a beneficiary of the land

allotted to respondent No.10. Thus, it is neither a

necessary nor a proper party in the writ petition.

32. Petitioners have filed separate rejoinder affidavits to

the counter affidavits of respondent No.1 and respondents

No.10 and 11.

32.1. While reiterating the averments made in the writ

affidavit, petitioners have asserted that respondents could

not disclose any valid and tenable reason justifying grant of

Acs.15.00 of land by way of lease in favour of respondent

No.10 i.e., Sai Sindhu Foundation. While acknowledging

that government lands could be granted to trusts and

societies on concessional rates keeping in view welfare of

the people, it is however contended that even such

allocation of land must be on a reasonable basis and done

in a transparent and equitable manner. Even if land is

allotted to institutions with a social objective, the allotment

must be in a manner consistent with principles of equality

 56

and non-arbitrariness. There is no justification for

allotment of prime land to respondent No.10 i.e., Sai

Sindhu Foundation at a throwaway price without

conducting public auction or issuing public notice inviting

similar proposals from other charitable institutions for

setting up a hospital on the same terms. Respondent

No.10 i.e., Sai Sindhu Foundation does not have any

experience in the field of establishment and managing

hospitals. Such allocation of land in favour of respondent

No.10 therefore reeks of favouritism and cannot be

countenanced. As against recommendations of Telangana

State Land Management Authority for Acs.10.00 of land to

respondent No.10, the State has allotted Acs.15.00 of land

without following the Government Land Allotment Policy

under G.O.Ms.No.571, dated 14.09.2012. Shockingly,

while fixing the annual lease rental, the State has applied

the same yardstick while allotting land to Basavatarakam

Cancer Hospital vide G.O.Ms.No.484, dated 26.05.1989,

which was made thirty years back. This itself indicates

 57

complete abdication of responsibility by the State and non-

application of mind.

32.2. It is contended that despite claims to the contrary,

the proposed cancer hospital is intended to be a profit

making venture as only 25% of the inpatients are

earmarked for the poor people; likewise, 40% of the

outpatients.

32.3. Petitioners have placed on record certain documents

which they have obtained under the Right to Information

Act, 2005. These include letter dated 22.04.2016 issued

by the Telangana State Industrial Infrastructure

Corporation Limited to put the identified lands for open

auction sale which included the subject land; proceedings

dated 03.05.2017 of the Collector, Ranga Reddy District

wherein it was mentioned that Telangana State Land

Management Authority in its meeting held on 04.04.2017

had recommended allotment of land to respondent No.10

on lease basis as per prevailing market value; letter of

 58

Chief Secretary dated 15.05.2017 confirming the

proceedings dated 03.05.2017 determining market value at

Rs.75,000.00 per square yard and for grant of lease to

respondent No.10 in terms of G.O.Ms.No.571, dated

14.09.2012; letter dated 02.08.2017 of the Collector, Ranga

Reddy District to the Special Chief Secretary scaling down

the land value from Rs.75,000.00 per square yard to

Rs.50.00 per square yard by taking the basic value as of

1989 etc. Petitioners have contended that in addition to

the loss of about Rs.5,346.00 crores to the exchequer, no

rational principle was followed for allotment of land to

respondent No.10 without any public notice or

advertisement, thus completely eliminating the process of

competitive bidding raising serious questions of probity in

the decision making. Even if the State land is to be allotted

for a public purpose, such allotment must be transparent

and follow a reasonable process.

 59

33. Mr. D.Prakash Reddy, learned Senior Counsel for the

petitioners submits that the manner in which the State has

granted prime land to respondent No.10 that too for a

pittance is highly questionable. The decision making

process is completely flawed and reflects extraneous

considerations and non-application of mind. There is no

material on record to suggest or to show that the State had

applied its mind to various factors and thereafter granted

the land to respondent No.10 on lease basis for a negligible

amount.

33.1. The irrationality of the entire exercise is discernible

from the fact that it is respondent No.10 who had made a

request to the State Government for allotment of a

particular plot of land to set up cancer hospital in respect

of which it has no previous experience. In fact, though

respondent No.10 claims to be a charitable institution it

has no experience of running any hospital not to speak of

any specialised hospital or cancer hospital. Though the

 60

Collector had suggested fixation of the land value at the

market rate, the same was completely abandoned and the

land was allotted to respondent No.10 as per rate granted

to Basavatarakam Cancer Hospital almost thirty years ago.

Interestingly, respondent No.10 sought for change of the

land though within the same area which was promptly

accepted by the State without any demur. This only goes to

show an unhealthy nexus between respondent Nos.10, 11

and 12 on the one hand and the higher officials of the

State Government on the other hand. It is true that in all

cases the State cannot have a rigid and an inflexible land

policy. In an appropriate case, land can be given to a

deserving person or entity at a concessional rate. State

being trustee of the resources of the State has to ensure

that the resources are utilised properly and for the benefit

of the public at large. It is evident that the hospital being

constructed by respondent No.10 would be a profitable

enterprise as only 25% of the in-patients would be given

free treatment so also 40% of the out-patients; besides

 61

some concessions granted for government schemes.

Dispensing with or granting State largesse in such a

brazen manner throwing all norms of probity and

transparency to the wind is unacceptable. This is contrary

to law.

33.2. Mr. D.Prakash Reddy, learned Senior Counsel

submits that though petitioners have computed the

estimated value of the land and the loss suffered by the

State, he would not like to harp on the figures. But

certainly it is a case of huge loss caused to the State on

account of granting of State largess to respondent No.10 in

a most non-transparent and arbitrary manner. There was

no occasion or invitation extended to other parties for

utilisation of such land for setting up of a hospital. On the

mere application of respondent No.10 prime land has been

allotted to it at a nominal lease rent of Rs.1,47,743.00 per

annum for a lease period of sixty years when according to

the petitioners the total rental value for the said period for
 62

the said plot of land would work out to more than

Rs.5,000.00 crores.

33.3. Calling upon the State to interfere in the matter,

learned Senior Counsel for the petitioners has placed

reliance on the following decisions:

(1) Sachidanand Pandey v. State of West Bengal 1;

(2) Hazi T.M.Hassan Rawther v. Kerala Financial

Corporation 2;

(3) Kumari Shrilekha Vidyardhi v. State of Uttar

Pradesh 3;

(4) New India Public School v. HUDA 4;

(5) Meerut Development Authority v. Association of

Management Studies 5;

(6) Akhil Bhartiya Upbhokta Congress v. State of

Madhya Pradesh 6;

1
(1987) 2 SCC 295
2
(1988) 1 SCC 166
3
(1991) 1 SCC 212
4
(1996) 5 SCC 510
5
(2009) 6 SCC 171
6
(2011) 5 SCC 29
 63

(7) Centre for Public Interest Litigation v. Union of

India 7;

(8) Natural Resources Allocation, in Re: Special

Reference 8;

(9) Usha Mehta v. Government of Andhra Pradesh 9;

(10) Institute of Law, Chandigarh v. Neeraj Sharma 10;

and

(11) Bihar State Housing Board v. Radha Ballabh

Health Care and Research Institute (P) Ltd. 11

34. Mr. B.S.Prasad, learned Advocate General for the

State, at the outset, submits that petitioners have no locus

standi to file the public interest litigation. None of the

averments made by the petitioners are based on any

thorough research or relevant material flows from any

authority. Though petitioner No.1 claims to be a medical

anthropologist and the second petitioner, a lawyer, they

7
(2012) 3 SCC 1
8
(2012) 10 SCC 1
9
(2012) 12 SCC 419
10
(2015) 1 SCC 720
11
(2019) SCC OnLine SC 1188
 64

lack the expertise required to assess and pass judgment on

the present policy decision of the government.

34.1. G.O.Ms.No.571 dated 14.09.2012 lays down the land

allotment policy of the State. Present allotment of land to

respondent No.10 is in accordance with the principles laid

down in the said land allotment policy. The said policy

clearly says that land may be allotted for public purposes,

health etc. The policy further provides for allotting land to

private companies for public purpose. Thus,

G.O.Ms.No.571 dated 14.09.2012 envisages that land can

be allotted for various purposes including social and

welfare activities. Land can also be allotted keeping the

above principles in mind at concessional rate.

34.2. He submits that Government took into consideration

the well worked model in this aspect i.e., Basavatarakam

Cancer Hospital as the relevant concessional policy and

followed G.O.Ms.No.484 dated 26.05.1989 and laid down

 65

the conditions similar to those laid down in the said

G.O.Ms.No.484 in the case of the present lessee as well.

34.3. He submits that contrary to the claim of the

petitioners, the land allotment policy of the State itself

provides for leasing out land at concessional prices by

imposing necessary conditions. Thus, he would contend

that allotment of land by way of lease at a concessional

price as has been done by the State in the present case is

not in violation of the land allotment policy.

34.4. He submits that it is true that the Revenue Divisional

Officer had submitted proposal for alienation of land in

favour of respondent No.10 on payment of market value

i.e., Rs.75,000/- per square yard keeping in view the

location of the site, so also the Joint Collector, which was

forwarded by the Telangana State Land Management

Authority. He would submit that the recommendation was

made on consideration of sale and not granting of land on

 66

lease. No other aspect was considered by the aforesaid

revenue authorities.

34.5. Further, though the Telangana State Land

Management Authority had recommended allotment of

Acs.10.00 land, government after thoroughly examining the

issue and considering all relevant aspects including the

project report submitted by respondent No.10, i.e., Sai

Sindhu Foundation as well as the earlier successful policy

of the government with regard to Basavatarakam Cancer

Hospital and the long term interest of the public decided to

allot land to respondent No.10 on non-profit basis by way

of lease i.e., on the same terms and conditions as in the

case of Basavatarakam Cancer Hospital. The cabinet after

due application of mind and in its wisdom has decided to

allot the land in the above manner to respondent No.10.

Merely because the Council of Ministers did not act on the

recommendations of the District Collector or the Telangana

State Land Management Authority and deviated therefrom,

 67

it cannot be said that the decision making process was

flawed or that there is no application of mind; rather there

was due application of mind by the State.

34.6. Learned Advocate General submits that as per

procedure contemplated under paragraph 4(v)(g) of

G.O.Ms.No.571, dated 14.09.2012, applications may be

made directly to the Hon’ble Chief Minister and it further

lays down the procedure to be followed thereafter.

Managing Trustee of Sai Sindhu Foundation

Dr. B.Parthasaradhi Reddy addressed letters dated

20.08.2015 and 02.04.2016 to the Hon’ble Chief Minister

requesting for allotment of land to an extent of Acs.15.48

guntas in Serilingampally Mandal on lease basis for

construction of hospital for treatment of cancer and other

life threatening diseases. After following the procedure laid

down therein, the Cabinet which is the ultimate decision

making authority on due application of mind decided to

allot the land to Sai Sindhu Foundation. While taking the

 68

above decision, Cabinet took into consideration the

laudable proposal of Sai Sindhu Foundation viz., that it

proposes to set up a state of the art cancer and other life

threatening diseases hospital having 540 beds in

Hyderabad to provide affordable medicare to the needy

cancer and other patients; the hospital would be built in

two phases with 540 + 540 (1080) beds with around 180

critical care beds and 12 operation theatres with a thrust

on cancer; the total expenditure that would be incurred for

construction of the cancer hospital would be to the tune of

Rs.438.05 crores; further the hospital complex would

provide residential accommodation to key medical and

para-medical personnel besides providing for dormitory

accommodation for attendants of patients. He submits

that considering the above and the investment being made

by respondent No.10 to provide for affordable health care

to the public, the State Government decided to allot the

land to Sai Sindhu Foundation at a concessional lease rent

by imposing certain terms and conditions, such as: i) the

 69

lease period shall be initially for thirty (30) years,

renewable for another period of thirty (30) years;

ii) the lease amount shall be collected as per the rate in

G.O.Ms.No.484, dated 26.05.1989, which was fixed for

Basavatarakam Cancer Hospital, for the first three (3)

years, whereafter there shall be a 5% increase in the lease

rental every three (3) years till the end of the lease period;

iii) 25% of the inpatients (IP), who are the poor people,

shall be treated free of cost; iv) 40% of outpatients (OP),

who are poor, shall be treated free of cost; v) 25% discount

shall be given in each bill for all in-patients (IP), admitted

under all government sponsored schemes like Aarogyasree,

Employees Health Scheme etc.

34.7. Learned Advocate General would therefore contend

that merely because the lease rental is perceived to be at a

lower figure in the estimation of the petitioners, that would

not render the land allotment bad in law.

 70

34.8. Learned Advocate General has also filed written

submissions and a compilation of judgments in support of

his submissions comprising the following decisions:

i) Kasturi Lal Lakshmi Reddy v. State of Jammu &

Kashmir 12;

ii) Sachidanand Pandey (supra);

iii) Union of India v. Jain Sabha 13;

iv) M.P Oil Extraction v. State of Madhya Pradesh 14;

v) Netai Bag v. State of W.B. 15;

vi) Pathan Mohammed Suleman Rehmatkhan v.

State of Gujarat 16;

vii) Odisha IIDC Ltd. v. Pitabasa Mishra 17;

viii) Babubhai Meghajibhai Shah v. State of

Gujarat 18;

ix) Goa Foundation v. Sesa Sterlite Ltd. 19;

12
(1980) 4 SCC 1
13
(1997) 1 SCC 164
14
(1997) 7 SCC 592
15
(2000) 8 SCC 262
16
(2014) 4 SCC 156
17
(2018) 3 SCC 732
18
2017 SCC Online Guj 299
19
(2018) 4 SCC 218
 71

x) Union of India v. Moolchand Kharaiti Ram

Trust 20; and

xi) J.S. Luthra Academy v. State of J&K 21.

35. Mr. S.Niranjan Reddy, learned Senior Counsel for

respondents No.10 and 11 submits that he would not like

to cast aspersions on the credentials of the petitioners.

However, he has found fault with the petitioners in

adopting a very narrow and pedantic approach. He

submits that unlike the petitioners the State has not

looked at the issue from the narrow prism of money only.

The overarching aspect that the State has looked at is

public interest. It is from the public interest perspective

that the allotment of land by the State in favour of

respondent No.10 Sai Sindhu Foundation should be looked

at. It would not be proper to adopt a mechanical or

technical approach.

20
(2018) 8 SCC 321
21
(2018) 18 SCC 65
 72

35.1. Learned Senior Counsel submits that Managing

Trustee of Sai Sindhu Foundation has rich experience in

pharmaceutical industry. Because of a personal tragedy

suffered by him, he is driven by a social motive to provide

world class healthcare facilities particularly in relation to

cancer and other life threatening diseases for the public. It

is a charitable purpose, but at the same time the hospital

has to sustain itself. The entire treatment in the hospital

cannot be made free of cost. Therefore, to enable

respondent No.10 to continue with the public service it has

been decided that while 40% of the outpatients would be

treated free of cost, similar benefit would be extended to

25% of the inpatients. That apart, substantial discount

would be provided to patients availing various schemes of

the government. Additionally, a dharamsala would be

constructed to house the attendants accompanying the

patients.
 73

35.2. Learned Senior Counsel submits that present is not

the only instance of a public private partnership initiative

in the healthcare centre. Various other States, notably

Odisha, has involved private sector to provide affordable

healthcare to the public. State Government has facilitated

the present private investment in the healthcare sector by

providing land. In such circumstances, auction or tender

for allotment of land cannot be the sole method or the sole

criteria.

35.3. Learned Senior Counsel has also emphasised on the

fact that no personal malafides have been attributed to the

respondents. He submits that if the conscience of the

court is clear that the present allotment of land by way of

lease to Sai Sindhu Foundation is in the public interest,

where commercial value of the land is only one of the

considerations, then there would be no good reason to

entertain the public interest litigation. He submits that it

is purely within the domain of policy of the State

 74

Government to provide for a conducive investment

environment in priority sectors like health by making land

available to the investor. Emphasis of Mr. S.Niranjan

Reddy, learned Senior Counsel is that one has to take a

holistic picture and not look at it only from the point of

view of high land value. Looked at from such a perspective

there is no irrationality or unreasonableness in the

allotment of land by the State to respondent No.10. As a

matter of fact, he would submit that government has

ensured that it continues to remain the owner of the land.

That is why, instead of outright allocation of land to

respondent No.10, government has opted for lease, that too

for a limited period of thirty years extendable by another

period of thirty years. He submits that grievance of the

petitioners is misconceived and therefore no interference is

called for.

35.4. While concluding Mr. S.Niranjan Reddy, learned

Senior Counsel for respondents No.10, 11 and 12 submits

 75

that construction of the hospital is going on now and the

hospital may be ready for inauguration by September,

2023. He has therefore requested the court to look into

this aspect of the matter as well.

36. In his reply submissions, Mr. D.Prakash Reddy,

learned Senior Counsel for the petitioners has referred to

the impugned G.O.Ms.No.59 dated 22.03.2018 and

submits that it is clearly a deviation from the earlier

G.O.Ms.No.571, dated 14.09.2012, as modified by

G.O.Ms.No.218, dated 01.12.2015. This has resulted in a

huge loss to the State exchequer.

36.1. Reiterating his previous contentions, he submits that

allotment of land to respondent No.10 was not done in a

transparent manner. There was no public auction as to

allotment of the land. Recommendations of the Collector

and the Telangana Land Management Authority were

simply brushed aside. Insofar respondent No.10 is

concerned, it was established only in the year 2014 with no

 76

previous experience either in construction or in

management of hospital. The hospital that is being

constructed by respondent No.10 is not a completely

charitable hospital. It is evident that respondent No.10 is

establishing a profit making hospital as a business venture

which though is a legitimate exercise but for the same,

government land could not have been given almost free of

cost. It is also not the case of the State that the land

allotted by it would be in the form of its equity participation

in the hospital project. Therefore, it is clearly a case of

abuse of State’s largesse which has been frowned upon by

the constitutional courts time and again. In addition to the

decisions already relied upon, learned Senior Counsel has

placed on record and relied upon the decision of the

Supreme Court in Humanity v. State of West Bengal 22.

37. Submissions made by learned counsel for the parties

have received the due consideration of the court.

22
(2011) 8 SCR 653
 77

38. Facts lie within a narrow compass. As noted above,

the turn of events started with submission of an

application by respondent No.10 on 20.08.2015 addressed

to the Hon’ble Chief Minister of Telangana requesting land

allotment on lease basis for setting up of cancer and other

life threatening diseases medicare centre. It was

mentioned in the said application that respondent No.10 is

a public charitable trust set up in the year 2014. Objective

of the trust is to set up a tertiary medicare centre of

excellence with state of the art world class infrastructure,

attended by world renowned doctors. It was pointed out

that land available with the Government of Telangana in

Survey Nos.5/2 to 5/23 of Izzatnagar Village,

Serilingampally Mandal, Ranga Reddy District was

impeccably suitable for the project. The application

mentioned that 25% of the beds in the medicare centre

would be made free of charge for the poor and 40% of the

outpatients would also be treated free of charge. Therefore,

respondent No.10 requested the government to allot land to

 78

an extent of Acs.15.48 guntas in Survey Nos.5/2 to 5/23 of

Izzatnagar Village, Serilingampally Mandal, Ranga Reddy

District on lease basis. This was followed by another

request letter of respondent No.10 dated 02.04.2016

addressed to the Hon’ble Chief Minister of Telangana.

While restating what was requested vide the initial

application dated 20.08.2015, it was however pointed out

that respondent No.10 came to know of some encumbrance

concerns in the land at Survey Nos.5/2 to 5/23 of

Izzatnagar Village, Serilingampally Mandal, Ranga Reddy

District. Therefore, respondent No.10 requested for

allotment of land at Survey No.41 of Khanamet Village,

Serilingampally Mandal in Ranga Reddy District.

39. It appears that after submission of such proposal by

respondent No.10, the same was processed by the

government. Following letter of Principal Secretary to the

Chief Minister dated 15.06.2016 requesting processing of

allocation proposal of an extent of Acs.15.00 in Survey

 79

No.41/14 situated at Khanamet Village, Serilingampally

Mandal in Ranga Reddy District in favour of respondent

No.10, the Special Chief Secretary to the Government of

Telangana, Revenue Department vide letter dated

29.06.2016 requested the Collector and District Magistrate,

Ranga Reddy District to do the needful. Special Grade

Deputy Collector and Revenue Divisional Officer,

Rajendranagar Division, wrote to the Collector of Ranga

Reddy District vide proceedings dated 26.08.2016 that the

land sought for by respondent No.10 is located in a prime

locality very near to Hitech City and 500 metres away from

the main road. Prevailing market value would be between

Rs.55,000.00 to Rs.60,000.00 per square yard for

residential and Rs.70,000.00 to Rs.80,000.00 per square

yard for commercial purpose. Prevailing market value of

the land would be Rs.33.70 crores per acre. Therefore, he

recommended Rs.75,000.00 per square yard keeping in

view the location of the land.

 80

39.1. Following the same, Collector and District Magistrate

of Ranga Reddy District submitted proposal dated

23.09.2016 to the Chief Commissioner of Land

Administration recommending allotment of land to an

extent of Acs.15.00 in Survey No.41/14/2 of Khanamet

Village, Serilingampally Mandal in Ranga Reddy District in

favour of respondent No.10 for establishment of cancer

hospital at Hyderabad. By the aforesaid proceedings, the

Collector and District Magistrate stated that the mentioned

documents were required to be submitted in terms of

G.O.Ms.No.571 dated 14.09.2012. While submitting the

aforesaid proposal, the Collector and District Magistrate

informed that the present market value would be

Rs.75,000.00 per square yard as per the report submitted

by the Special Grade Deputy Collector and Revenue

Divisional Officer.

40. A meeting of the Telangana State Land Management

Authority was held on 04.04.2017. The meeting discussed

 81

allotment of government land to different government

departments and private organisations for various

purposes. At serial No.11, the proposal was for allocation

of government land (land resumed from HMDA) to an

extent of Acs.15.00 situated in Survey No.41/14/2 of

Khanamet Village, Serilingampally Mandal in Ranga Reddy

District in favour of respondent No.10 for establishment of

cancer hospital. Collector of Ranga Reddy District

explained the proposal and informed that the land is

primely located and highly valuable. According to the

Managing Director of Telangana State Industrial

Infrastructure Corporation, the nearby land when

auctioned could fetch Rs.59,917.00 per square yard. Be

that as it may, Special Chief Secretary, Incharge of Medical

and Health, gave consent for allotment of land to

respondent No.10 on lease basis. Telangana State Land

Management Authority after due deliberation resolved to

recommend as follows:
 82

a. The proposal for allotment of government land on

lease basis to an extent of Ac.15.00 gts. situated in
Sy.No.41/14/2 at Khanamet Village, Serilingampally (M),
Ranga Reddy District in favour of M/s. Sai Sindhu
Foundation for establishment of Cancer Hospital is
recommended on payment of lease rental based on
prevailing market value given the purpose/gross nature
of the land.

b. The Collector, Ranga Reddy District is directed to

furnish a detailed note along with the facts of the case
and specific recommendation.

41. Thus, Telangana State Land Management Authority

recommended that land to an extent of Acs.15.00 situated

in Survey No.41/14/2 of Khanamet Village,

Serilingampally Mandal in Ranga Reddy District, may be

allotted in favour of respondent No.10 on lease basis for

establishment of cancer hospital on payment of lease rental

based on the prevailing market value.

42. Following the same, Collector and District Magistrate,

Ranga Reddy District, submitted proposal before the

Special Chief Secretary and Chief Commissioner of Land

Administration vide proceedings dated 03.05.2017 for

 83

allotment of Acs.15.00 of land (equivalent to 72,600 square

yards) in Survey No.41/14/2 of Khanamet Village,

Serilingampally Mandal in Ranga Reddy District in favour

of respondent No.10 for establishment of a world class

cancer and other life threatening diseases management

medicare centre. The Collector made the recommendation

for allotment of land on lease basis on payment of lease

rental on prevailing market value at the rate of

Rs.75,000.00 per square yard. The lease rental would be

10% of the prevailing market value as fixed by the

Telangana State Land Management Authority/competent

authority in terms of paragraph 3(d) of G.O.Ms.No.571,

dated 14.09.2012. As per the recommendation, the lease

period at the first instance should not exceed 33 years

though it can be extended on mutually agreed terms and

conditions.

42.1. Responding to the same, Chief Secretary and Chief

Commissioner of Land Administration wrote to the Special

 84

Chief Secretary to the Government of Telangana, Revenue

(Assignment) Department vide proceedings dated

15.05.2017 forwarding therewith the minutes of the

meeting of the Telangana State Land Management

Authority dated 04.04.2017 and the proposal of the

Collector to the government for issuance of suitable order.

While forwarding the same to the government, the Chief

Secretary and Chief Commissioner of Land Administration

observed that the need for such a large extent of land for

the purpose of establishment of cancer hospital may also

be reassessed. In the meanwhile, respondent No.10

submitted project report to set up a cancer and other life

threatening diseases hospital in Hyderabad before the

Chief Commissioner of Land Administration.

42.2. Government vide memo dated 03.06.2017 stated that

the matter was examined in consultation with the Health,

Medical and Family Welfare Department. The latter

mentioned about the land area requirement etc., for

 85

establishment of hospital as per Indian Public Health

Standards. It was mentioned that in the application of

respondent No.10 no details were available for assessment

of the land to be allotted. It appears that there was a

revised proposal pursuant to proceedings of the Collector

dated 15.06.2017, proceedings of the Chief Commissioner

of Land Administration dated 01.07.2017 and 22.07.2017

for allotment of Acs.10.00 to Acs.11.00 of land to

respondent No.10 for establishment of the cancer hospital

instead of Acs.15.00 as was earlier recommended. In this

connection, government had issued a memo dated

23.08.2017. All these were forwarded to the Collector,

Ranga Reddy District by the Chief Secretary and Chief

Commissioner of Land Administration vide proceedings

dated 08.10.2017 with a request to furnish the revised

proposal for allotment of Acs.10.00 to 11.00 of land for

establishment of the cancer hospital instead of Acs.15.00

as was proposed earlier. It may mentioned that vide memo

dated 23.08.2017, Special Chief Secretary to the

 86

Government of Telangana in the Revenue (Assignment-II)

Department had drawn the attention of the Chief Secretary

and Chief Commissioner of Land Administration to obtain

remarks/recommendations of the Telangana State Land

Management Authority again on the revised proposal for

allotment of Acs.10.00 to 11.00 of land for establishment of

cancer hospital instead of Acs.15.00 as was recommended

earlier.

43. Collector of Ranga Reddy District informed Chief

Secretary to the Government of Telangana and Chief

Commissioner of Land Administration vide proceedings

dated 29.10.2017 mentioning that in view of the

observations made by the Special Chief Secretary that the

need for allotment of such large extent of land may also be

reassessed, revised proposal was called for allotment of

land to an extent of Acs.10.00 to 11.00 for establishment of

cancer hospital instead of Acs.15.00. As per the location

sketch, the marked area as ‘A’ admeasuring Acs.10.00 was

 87

proposed for establishment of the cancer hospital.

Therefore, a revised proposal for allotment of land to an

extent of Acs.10.00 (marked area as ‘A’ in the sketch)

instead of Acs.15.00 as was recommended earlier in favour

of respondent No.10 for establishment of cancer hospital

on lease basis was forwarded.

44. It appears that the revised proposal for allotment of

Acs.10.00 of land instead of Acs.15.00 of land in favour of

respondent No.10 on lease basis was placed before the

Telangana State Land Management Authority (briefly, ‘the

Authority’ hereinafter) on 21.12.2017. The Authority made

the following recommendations:

1. The Collector Rangareddy District has briefed about

the proposals as follows:

a) Earlier the proposals for Land Allotment are placed

before the TSLMA on 04-04-2017 wherein it was
recommended for allotment of land to an extent of
Ac.15.00 gts. situated in Sy.No.41/4 at Khanamet
(V), Serilingampally (M), Rangareddy District in
favour of M/s. Sai Sindhu Foundation on lease
basis, for establishment of cancer hospital only.
 88

b) Accordingly, proposals were sent to the government.

c) Government in turn requested to obtain the
remarks of TSLMA again for allotment for only
Cancer Hospital.
d) Accordingly, Collector furnished revised proposal for
Ac.10-00 gts and recommended for only Cancer
Hospital.
e) As per the Detailed Project Report (DPR) the
foundation mentions for “State of art cancer and
other life threatening diseases hospital”. As per
Medical & Health Department recommendation, it is
mentioned as “utility for cancer and life threatening
diseases Medicare Centre”. Earlier, TSLMA
recommended for only Cancer Hospital. The
allotment is recommended by Collector, Rangareddy
District on lease basis.
f) The market value is Rs.75,000/- per sq. yard and
basic value of the land is Rs.30,000/- per sq. yard.
g) The Collector has recommended Rs.75,000/- per sq.
yard.

2. The Principal Secretary, Medical & Health

Department informed that as per the guidelines
prescribed by the Government of India, the extent is
recommended to be reduced from Ac.15.00 gts to
Ac.10-00 gts.

3. After detailed deliberation the authority resolved to

recommend for allotment of land in Sy.No.41/14/2
extent Ac.10.00 gts in Khanamet (V),
 89

Serilingampally (M) on lease basis on payment of

lease rental as per the conditions stipulated in
G.O.Ms.No.571, Rev (Assn.I) Dept, dt.14.9.12 read
with G.O.Ms.No.218 dt. 1.12.2015 in favour of M/s.
Sai Sindhu Foundation, specifically for
establishment of Cancer Hospital and not for any
other purposes.

45. As per fresh recommendations of the Authority, it

was resolved to allot Acs.10.00 of land to respondent No.10

in Survey No.41/14/2 of Khanamet Village,

Serilingampally Mandal on lease basis on payment of lease

rental as per conditions stipulated in G.O.Ms.No.571 dated

14.09.2012 read with G.O.Ms.No.218 dated 01.12.2015.

46. Based on the above recommendations of the

Authority, Chief Secretary and Chief Commissioner of Land

Administration wrote to the Special Chief Secretary to the

Government of Telangana, Revenue (Assignment)

Department, vide proceedings dated 27.12.2017 forwarding

therewith proposal of the Collector, Ranga Reddy District,

along with minutes of the meeting of the Authority held on

 90

21.12.2017 to the government for issuance of suitable

order(s) as to allotment of Acs.10.00 of land situated in

Survey No.41/14/2 of Khanamet Village, Serilingampally

Mandal, Ranga Reddy District in favour of respondent

No.10 Sai Sindhu Foundation specifically for establishment

of cancer hospital on lease basis.

47. Following submission of revised proposal,

Government of Telangana in the Revenue (Assignment.II)

Department issued G.O.Ms.No.59, dated 22.03.2018. It is

stated that after careful examination of the revised

proposal, government decided to allot government land to

an extent of Acs.15.00 situated in Survey No.41/14/2 of

Khanamet Village, Serilingampally Mandal, Ranga Reddy

District in favour of respondent No.10 Sai Sindhu

Foundation for construction of cancer hospital on non-

profit basis. The allotment of land is on lease basis and on

the same terms and conditions as applicable in the case of

Basavatarakam Cancer Hospital. The allotment of land on

 91

lease basis has been made subject to the terms and

conditions mentioned therein.

48. It is this G.O.Ms.No.59 dated 22.03.2018 which has

been impugned in the present proceeding. Relevant

portion of G.O.Ms.No.59 dated 22.03.2018 reads as

follows:

9. Government, after careful examination having

considered the proposal in detail has decided for
allotment of government land to an extent of Ac.15.00
guntas situated in Sy.No.41/14/2 of Khanamet (V),
Serilingampally (M), Ranga Reddy District, in favour of
M/s.Sai Sindhu Foundation, for construction of Hospital
for Cancer and other life threatening diseases, on non-
profit basis, on lease basis, on the same terms and
conditions as applicable in the case of Basavatarakam
Cancer Hospital and accordingly hereby order for
allotment of Government land to an extent of Ac.15.00
guntas situated in Sy.No.41/14/2 of Khanamet (V),
Serilingampally (M), Ranga Reddy District, in favour of
M/s.Sai Sindhu Foundation, for construction of Hospital
for Cancer and other life threatening diseases, on non-
profit basis, on lease basis, subject to the following
conditions:
 92

i. The lease period shall be initially for thirty

(30) years, renewable for another period of
thirty (30) years.
ii. The lease amount shall be collected as per
the rate in G.O.Ms.No.484, Revenue
(Assn.III) Dept., dated 26.05.1989, wherein,
lease amount was fixed for Basavatarakam
Cancer Hospital, for the first three (3) years
and there shall be a 5% increase in the lease
rental thereafter for every three (3) years till
the end of the lease period.
iii. 25% of the “In Patients (IP)”, who are the
poor people, shall be treated free of cost.
iv. 40% of Out-Patients (OP), who are poor,
shall be treated free of cost.
v. 25% discount shall be given in each bill for
all In-patients (IP), admitted under all
government sponsored schemes like
Aarogyasree, Employees Health Scheme etc.,
vi. The lease rent shall be paid by the lessee
per annum as fixed above and before
January 10th of every year and the same
shall be remitted in the Government
Treasury through proper Head of Account.
vii. Hospital building shall be completed within
two (2) years from the date of putting the
foundation in possession of the land.
viii. The primary responsibility of monitoring
and utilization of government land allotted
to various organizations vest with the
 93

concerned Departments. Hence, the Director

of Health shall ensure the development of
land, management agreements and progress
of implementation of project and also to
monitor the utilization of land.
ix. No mortgage of the land without the prior
approval of the government.
x. The management of proposed hospital shall
submit a monthly report to the Director of
Health and the Collector, Ranga Reddy
District, with the details of “In Patients (IP)
and Out-Patients (OP)”, who have been
treated freely under the above conditions,
failing which, the District Collector shall call
for explanation; if he is not satisfied, he
shall initiate proceedings for resumption of
the land.
xi. The land shall be used for the purpose for
which it is allotted and not for any other
purposes.
xii. Any violation of the said conditions will
automatically cancel the lease and the said
land will be reverted back to the Collector,
Ranga Reddy District, without any prior
notice thereof.
xiii. Other usual conditions laid under BSO-23
& utilization of land as per BSO-24, as
applicable;
 94

10. The Chief Commissioner of Land Administration,

Telangana, Hyderabad, the Collector, Ranga Reddy
District and the Director of Health, TS., Hyderabad, shall
take necessary action, accordingly.

11. This order issues with the concurrence of the

Finance (EBS-VII) Department, vide their U.O.No.15806-
A/355/EBS-VII/Rev/2017, dated 28.12.2017.

49. From the above, it is evident that while the revised

proposal was for Acs.10.00 of land, government decided to

allot Acs.15.00 of land to respondent No.10. While the

proposal as well as the revised proposal was for allotting

the land as per the market value, which was calculated at

Rs.75,000.00 per square yard, government decided to allot

the land on lease basis stating that the lease amount

would be as per rate in G.O.Ms.No.484 dated 26.05.1989

wherein lease amount was fixed for Basavatarakam Cancer

Hospital. The lease amount would be the same as in

G.O.Ms.No.484 dated 26.05.1989 for the first three years

which would be increased at the rate of 5% thereafter for

every three years till the end of the lease period which is
 95

initially for thirty years renewable for another period of

thirty years.

50. Respondent No.10 submitted a representation dated

04.04.2018 to the District Collector, Ranga Reddy District

for change in subdivision location sketch in Survey

No.41/14/2 of Khanamet Village in Serilingampally Village.

By way of the said representation, respondent No.10

requested to change the subdivision location sketch of the

land for the reasons mentioned in the representation. The

change of location was requested primarily to meet the

design of the hospital and to ensure maximum space

utility.

51. Collector of Ranga Reddy District wrote to the Special

Chief Secretary to the Government of Telangana in the

Revenue Department vide proceedings dated 14.04.2018.

In this connection, Collector pointed out that as per

G.O.Ms.No.484, dated 26.05.1989, lease amount for land

to an extent of Acs.7.35 guntas in Survey No.346/1 of

 96

Shaikpet Village, Golconda Mandal, in favour of Smt.

Nandamuri Basavataraka Rama Rao Memorial Cancer

Foundation was Rs.50,000.00 per annum for the first three

years with 5% increase in the lease rental every three years

thereafter till the end of the lease period. Collector

mentioned that land was allotted to Basavatarakam Cancer

Hospital in the year 1989. Land allotted to Sai Sindhu

Foundation i.e., respondent No.10 is in the year 2018.

Market value of both the lands has varied from the year

1989 to the year 2018. It was pointed out that prevailing

market value of the land allotted to respondent No.10 for

commercial use would be in the range of Rs.70,000.00 to

Rs.80,000.00 per square yard. Attention of the Special

Chief Secretary to the Government of Telangana was drawn

to paragraph 3(h)(d) of G.O.Ms.No.571 dated 14.09.2012 as

amended vide G.O.Ms.No.218 dated 01.12.2015 which

says that lease rental would be 10% of the prevailing

market value per annum as fixed by the competent

authority which should be revised after every five years and

 97

refixed at 10% of the prevailing market value as on the date

of the revision. Therefore, Collector sought for clarification

from the Special Chief Secretary as to whether lease

amount of Rs.50,000.00 per annum mentioned in

G.O.Ms.No.484, dated 26.05.1989 would be applicable or

to issue clear instructions as to what would be the lease

amount for the land to the extent of Acs.15.00 allotted to

respondent No.10. This was followed by another letter of

the Collector dated 07.06.2018.

52. Special Chief Secretary and Chief Commissioner of

Land Administration wrote letter dated 07.07.2018 to the

Government in the Revenue (Assignment.II) Department on

the above aspect and also regarding change of alignment of

land requested by respondent No.10.

53. Special Chief Secretary to the Government of

Telangana in the Revenue (Assignment.II) Department

issued Memo dated 02.08.2018 conveying that Government

had ordered that the land admeasuring Acs.15.00 situated

 98

in Survey No.41/14/2 of Khanamet Village,

Serilingampally Mandal in Ranga Reddy District as shown

in Map-C should be handed over to respondent No.10

instead of land shown in Map-B as previously proposed by

the Collector. Collector of Ranga Reddy District was

requested to calculate the lease amount per annum in

respect of the allotted land proportionately to the extent of

land taking into consideration the present lease amount

charged on the rate of Rs.50,000.00 per annum with 5%

annual increase for every three years as fixed in the case of

Basavatarakam Cancer Hospital vide G.O.Ms.No.484 dated

26.05.1989 and to communicate the lease amount so

calculated to the government for taking further action.

Relevant portion of the Memo dated 02.08.2018 reads as

follows:

4. Government, after careful examination of the

matter, hereby order that, the land to an extent of
Ac.15-00 guntas situated in Sy.No.41/14/2 of Khanamet
(V), Serilingampally (M), Ranga Reddy District, as shown
in Map-C (prepared by the DC & Tahsildar,
 99

Serilingampally basing on the TSIIC layout), be handed

over to M/s.Sai Sindhu Foundation instead of the land to
an extent of Ac.15-00 guntas shown in Map ‘B’ (as
previously proposed by the Collector, Ranga Reddy
District in his letter dated 29.10.2017), subject to
fulfillment of all the conditions as prescribed in
G.O.Ms.No.59, Revenue (Assn.II) Department, dated
22.03.2018.

5. Further, the Collector, Ranga Reddy District, is

requested to calculate the lease amount per annum in
respect of the above land (i.e., to an extent of Ac.15-00
guntas situated in Sy.No.41/14/2 of Khanamet (V),
Serilingampally (M), Ranga Reddy District) leased out in
favour of M/s.Sai Sindhu Foundation, proportionately to
the extent of land, duly keeping in view, the present lease
amount charged on the rate of Rs.50,000/- per annum
on 5% increase of lease rent for every 3 years, as fixed in
case of Basavatarakam Cancer Hospital for an extent of
Ac.7.35 guntas vide G.O.Ms.No.484, Revenue (Assn.III)
Department, dated 26.05.1989; and communicate the
lease amount so calculated, to the government, for taking
further action.

54. It was thereafter that the Collector of Ranga Reddy

District issued proceedings dated 03.08.2018 withdrawing

the previous proceedings allotting land to respondent

No.10 as per Map-B and directing the Deputy Collector and

 100

Tahsildar, Serilingampally Mandal to handover physical

possession of the allotted land to an extent of Acs.15.00 in

Survey No.41/14/2 of Khanamet Village, Serilingampally

Mandal as shown in Map-C to respondent No.10 for

construction of cancer hospital.

55. Thereafter, vide panchanama dated 06.08.2018 the

land was handed over to respondent No.10 in the presence

of panchas and witnesses.

56. Special Chief Secretary to the Government of

Telangana in the Revenue (Assignment.II) Department

issued Memo dated 11.01.2019. It appears that Collector

of Ranga Reddy District vide letter dated 26.08.2018 had

informed that present lease amount paid by

Basavatarakam Cancer Hospital for land to an extent of

Acs.7.35 guntas is Rs.77,564.00 with 5% increase of lease

rent for every three years. On the above basis, present

lease rent of respondent No.10 Sai Sindhu Foundation for

Acs.15.00 of land works out to Rs.1,47,743.00 per annum

 101

for the first three years with 5% increase in the lease rental

after every three years till the end of the lease period.

Government after careful examination of the matter agreed

with the proposal of the District Collector, Ranga Reddy

District to fix the lease amount at Rs.1,47,743.00 per

annum for allotment of government land to an extent of

Acs.15.00 on lease basis to respondent No.10. The said

amount would be for the first three years and increased

thereafter at the rate of 5% for every three years till the end

of the lease period. Relevant portion of the Memo dated

11.01.2019 is as follows:

5. In the reference 5th cited, the Collector, Ranga

Reddy District has reported that, the present lease
amount being paid by the Basavatarakam Cancer
Hospital is Rs.77,564/- (on the rate of Rs.50,000/- per
annum on 5% increase of lease rent for every (3) years)
for the land to an extent of Ac.7.35 guntas as fixed in
G.O.Ms.No.484, Revenue (Assn.III) Department, dated
26.05.1989 and therefore, the present lease rent in case
of M/s.Sai Sindhu Foundation works out to
Rs.1,47,743/- per annum for the land to an extent of
Ac.15-00 guntas in Sy.No.41/14/2 of Khanamet (V),
Serilingampally Mandal for the first (3) years and there
 102

shall be a 5% increase in the lease rental thereafter for

every (3) years, till the end of lease period as fixed in case
of Basavatarakam Cancer Hospital in G.O.Ms.No.484,
Revenue (Assn.III) Department, dated 26.05.1989 and
requested the government to issue confirmation orders on
his proposal.

6. Government, after careful examination of the

matter, agree with the proposal of the District Collector,
Ranga Reddy to fix the lease amount Rs.1,47,743/- per
annum for the government land to an extent of Ac.15-00
guntas situated in Sy.No.41/14/2 of Khanamet (V),
Serilingampally Mandal, Ranga Reddy District allotted in
favour of M/s.Sai Sindhu Foundation for construction of
Hospital for cancer and other life threatening diseases on
a non-profit basis, on lease basis, for the first (3) years
and there shall be a 5% increase in the lease rental
thereafter for every (3) years, till the end of lease period
as fixed in case of Basavatarakam Cancer Hospital in
G.O.Ms.No.484, Revenue (Assn.III) Department, dated
26.05.1989.

57. Insofar G.O.Ms.No.484 dated 26.05.1989 of the then

Government of Andhra Pradesh is concerned, it is seen

that Managing Trustee of Smt. Nandamuri Basava Taraka

Rama Rao Memorial Cancer Foundation had submitted a

representation dated 12.02.1989 requesting the

 103

government to alienate government land to an extent of

Acs.9.00 for setting up of a cancer hospital in Hyderabad.

It was mentioned that a memorandum of understanding

had already been entered into between the foundation and

Dr. Nori.D who was the Chief of Brachy Therapy service of

Sloan Kettering Cancer Memorial Hospital in New York, an

NRI doctor. It was pointed out that land available in road

No.6, Banjara Hills, was eminently suitable for such

hospital. Government after examining the request decided

to lease out Acs.7.35 guntas of land to the foundation

subject to the following conditions:

i) The lease period shall be initially for 30 (thirty)

years, renewable for another period of 30 (thirty)
years.
ii) The lease amount shall be Rs.50,000/- per
annum for the first three years and there shall be
a 5% increase in the lease rental thereafter for
every three years till the end of the lease period.
iii) 25% of the beds shall be free to the poor.
iv) 40% of the out-patients shall be treated free of
cost; and
 104

v) The building shall be completed in two years

from the date of putting the Cancer Foundation
in possession of the land;

58. Thus land was allotted to Basavatarakam Cancer

Hospital on lease basis initially for thirty years renewable

for another thirty years. The lease amount was fixed at

Rs.50,000.00 per annum for the first three years with 5%

increase in the lease rental thereafter for every three years

till the end of the lease period; 25% of the beds were to be

kept free for the poor; and 40% of the outpatients were

required to be treated free of cost etc.

59. The aforesaid land allotment was made to

Basavatarakam Cancer Hospital by the State when there

was no land allotment policy. It appears to be an ad hoc

government decision which was not questioned at that

point of time.

60. Be that as it may, in order to have uniform guidelines

with regard to government land to be allotted for various

 105

purposes to different government departments and private

organisations both in terms of extent and rate it was felt

necessary by the Government that there should be a

Government Land Allotment Policy. It was thereafter that

Government Land Allotment Policy was framed and notified

by the then Government of Andhra Pradesh vide

G.O.Ms.No.571, dated 14.09.2012. It was clarified that the

said Government Land Allotment Policy would supersede

all existing government orders and instructions with regard

to allotment of government land for various purposes to

different government departments and private

organisations. As per paragraph 3(b), there should be

rational norms for fixing cost of land to be allotted. While

fixing the cost of land to be charged, the general principles

laid down in BSO-24 which take into consideration the

purpose of allotment and the nature of organisation shall

be followed. The allotment/alienation shall be on market

value as recommended by the Collector and Andhra

Pradesh Land Management Authority (now Telangana State

 106

Land Management Authority), already referred to as the

Authority hereinabove. Market value should be

ascertained by conducting local enquiry. However, the

land value shall not be less than the basic value of the

land. If the market value of land is Rs.1.00 crore and

below the competent officer would be the Revenue

Divisional Officer; if the value is above Rs.1.00 crore then

the competent officer is the Collector. The Land Allotment

Policy provided for constitution of the Authority as referred

to above. Insofar lease rental is concerned, it is mentioned

in paragraph 3(h)(d) that lease rental would be 10% of the

prevailing market value as fixed by the competent authority

which shall be enhanced every five years by increasing up

to 10% as fixed by the competent authority on the lease

rental of the previous block of five years.

61. Government of Telangana in the Revenue

(Assignment.I) Department issued G.O.Ms.No.218, dated

01.12.2015 substituting paragraph 3(h)(d) of the

 107

Government Land Allotment Policy contained in

G.O.Ms.No.571, dated 14.09.2012. As per the substituted

provision, the lease rental will be 10% of the prevailing

market value per annum as fixed by the competent

authority. The lease rental shall be revised every five years

and refixed at 10% of the prevailing market value as on the

date of revision. This provision being relevant is extracted

hereunder:

Para 3(h)(d): “The lease rental will be 10% of the

prevailing market value per annum as fixed by the
competent authority. The lease rental shall be revised for
every 5 years and re-fixed at 10% of the prevailing market
value as on the date of revision.”

62. Thus as per the Government Land Allotment Policy

dated 14.09.2012 as amended on 01.12.2015, if

government land is allotted on lease basis, then the lease

rental will be 10% of the prevailing market value per

annum as fixed by the competent authority which is

 108

revisable every five years and re-fixed at 10% of the

prevailing market value as on the date of revision.

63. From the materials on record, what is deducible is

that contrary to the revised proposal of the Collector to

allot Acs.10.00 of land to respondent No.10 as approved by

the Authority, the State has allotted Acs.15.00 of land to

respondent No.10. The land allotted by the State was not

as per its discretion but as pointed out by respondent

No.10. Later on, respondent No.10 sought for change of

alignment of the land. Even this was agreed to by the

State. That apart as against the repeated proposals of the

Collector and approved by the Authority, the State did not

fix the lease rental of the allotted land to respondent No.10

in terms of paragraph 3(h)(d) of G.O.Ms.No.571 dated

14.09.2012 as substituted by G.O.Ms.No218 dated

01.12.2015. The market value of the land was fixed by the

authority at Rs.75,000.00 per square yard. Instead, the

State Government decided to allot Acs.15.00 of land to

 109

respondent No.10 on lease basis as per lease rental fixed

while allotting land to the extent of Acs.7.35 guntas to

Basavatarakam Cancer Hospital in the year 1989.

G.O.Ms.No.59 dated 22.03.2018 by which the impugned

allotment has been made does not disclose any reasons for

making a departure from the Government Land Allotment

Policy qua the lease rental or from the revised proposal of

the Collector as approved by the Authority. Since it is a

non-speaking order, it does not indicate or reflect any

application of mind to the above two aspects.

64. As already mentioned in the earlier part of this

judgment, there was no Government Land Allotment Policy

holding the field in the year 1989. That apart, lease rental

determined in the year 1989 has been made the basis for

fixing the lease rental of the land allotted to respondent

No.10 in the year 2018. In other words, the lease rental

has been maintained at the same level as in the year 1989

notwithstanding the fact that land has been allotted to

 110

respondent No.10 thirty years thereafter when value of

land in the city of Hyderabad has increased manifold. It is

true that as per the Government Land Allotment Policy,

government land can be sought and allotted for public

purpose including setting up of educational and health

institution and there is no requirement of tender or

auction; nonetheless the policy postulates that if the land

is allotted on lease basis then the lease rental would have

to be fixed at the rate of 10% of the prevailing market value

per annum (emphasis is ours) as fixed by the competent

authority which is revisable after every five years. In the

instant case, the competent authority has determined the

market value of the land at the rate of Rs.70,000.00 to

Rs.80,000.00 per square yard for commercial use. Extent

of land proposed was Acs.10.00. As opposed to this, the

State has allotted Acs.15.00 of land to respondent No.10 at

the rate of Rs.1,47,743.00 per annum revisable every five

years with 5% increase. Thus, prime government land has

been allotted by the State to respondent No.10 almost at

 111

negligible value. It is not the case that government has

allotted land to respondent No.10 as some kind of private

public participation with the land component being the

equity share of the State. Thus, prime government land

has been allotted to respondent No.10 on a platter virtually

without any consideration.

65. Government is the trustee of the resources of the

State. It holds the resources in trust for and on behalf of

the people. Therefore, it is incumbent upon the

government to ensure that while conferring benefits of

State’s resources, including land, or granting State’s

largesse, the public interest has to be borne in mind. In

fact, it is the public interest alone which is paramount.

66. In Sachidanand Pandey (supra) Supreme Court held

that State-owned or public-owned property is not to be

dealt with at the absolute discretion of the executive.

Certain precepts and principles have to be observed.

Public interest is the paramount consideration. One of the

 112

methods of securing the public interest, when it is

considered necessary to dispose of a property is to sell the

property by public auction or by inviting tenders. Though

it is the ordinary rule, it is not an invariable rule. There

may be situations where there are compelling reasons

necessitating departure from the rule but the reasons for

the departure must be rational and should not be

suggestive of discrimination. Supreme Court held as

follows:

40. On a consideration of the relevant cases cited at

the Bar the following propositions may be taken as well
established: State-owned or public-owned property is not
to be dealt with at the absolute discretion of the
executive. Certain precepts and principles have to be
observed. Public interest is the paramount consideration.
One of the methods of securing the public interest, when
it is considered necessary to dispose of a property, is to
sell the property by public auction or by inviting tenders.
Though that is the ordinary rule, it is not an invariable
rule. There may be situations where there are compelling
reasons necessitating departure from the rule but then
the reasons for the departure must be rational and
should not be suggestive of discrimination. Appearance of
public justice is as important as doing justice. Nothing
 113

should be done which gives an appearance of bias,

jobbery or nepotism.

66.1. That was a case where Government of West Bengal

had granted land to the Taj Group of Hotels for

construction of five star hotel in Calcutta as part of the

tourism policy. The land was granted on lease basis. On

the facts and circumstances of that case, Supreme Court

expressed satisfaction that the Government of West Bengal

had acted perfectly bona fide in granting lease of the land

to the Taj Group of Hotels. Supreme Court noted that the

Government of West Bengal did not fail to take into

account any relevant consideration. The financial interests

of the State were in no way sacrificed either by not inviting

tenders or holding a public auction or by adopting the “net

sales” method.

67. Likewise, in New India Public School (supra) Supreme

Court considered provisions of the Haryana Urban

Development (Disposal of Land and Buildings) Regulations,

1978, framed under the Haryana Urban Development

 114

Authority Act, 1977, in the context of challenge to

allotment of land for establishment of schools. Supreme

Court observed that several modes of disposal of property

have been provided, including by way of public auction,

allotment or otherwise. In that context, Supreme Court

observed that when the public authority discharges its

public duty, the word “otherwise” would be construed to be

consistent with public purpose. For this, clear and

unequivocal guidelines or rules are necessary. Public

authorities cannot act at their whims and fancies for any

extraneous consideration. Public authorities are required

to make necessary specific regulations or valid guidelines

to exercise their discretionary powers; otherwise, the

salutary procedure would be by public auction.

68. In the case of Meerut Development Authority (supra)

Supreme Court observed that the effort made by the

Meerut Development Authority to augment its financial

resources and revenue cannot be said to be an

 115

unreasonable decision. The struggle to get for the State

full revenue of its resources is particularly pronounced in

the sale of state-owned natural assets to the private sector.

According to the Supreme Court, whenever the government

or the authorities get less than the full value of the asset,

the country is being cheated. There is a simple transfer of

wealth from the citizens as a whole to whoever gets the

assets ‘at a discount’. This is what the Supreme Court

observed:

50. We are, however, of the opinion that the effort, if

any, made by MDA to augment its financial resources and
revenue itself cannot be said to be an unreasonable
decision. It is well said that the struggle to get for the State
the full value of its resources is particularly pronounced in
the sale of State-owned natural assets to the private
sector. Whenever the Government or the authorities get
less than the full value of the asset, the country is being
cheated; there is a simple transfer of wealth from the
citizens as a whole to whoever gets the assets “at a
discount”. Most of the times the wealth of the State goes to
the individuals within the country rather than to
multinational corporations; still, wealth slips away that
ought to belong to the nation as a whole.
 116

69. Supreme Court in the case of Akhil Bhartiya

Upbhokta Congress (supra) examined the following

question:

Whether the decision of the Government of Madhya

Pradesh to allot 20 acres land comprised in Khasra Nos.
82/1 and 83 of Village Bawadiya Kalan, Tehsil Huzur,
District Bhopal to late Shri Kushabhau Thakre Memorial
Trust (for short “the Memorial Trust”)/Shri Kushabhau
Thakre Training Institute (Respondent 5) without any
advertisement and without inviting other similarly
situated organisations/ institutions to participate in the
process of allotment is contrary to Article 14 of the
Constitution and the provisions of the Madhya Pradesh
Nagar Tatha Gram Nivesh Adhiniyam, 1973 (for short
“the Act”) and whether modification of the Bhopal
Development Plan and change of land use is ultra vires
the mandate of Section 23-A of the Act are the questions
which arise for consideration in this appeal filed against
the order of the Madhya Pradesh High Court dismissing
the writ petition filed by the appellant.

69.1. It was in that context Supreme Court held as follows:

65. [Ed.: Paras 65, 66 and 68 corrected vide

Official Corrigendum No. F.3/Ed.B.J./23/2011 dated
3-5-2011 and para 67 corrected vide Official
Corrigendum No. F.3/Ed.B.J./28/2011 dated 7-5-
 117

2011.] . What needs to be emphasised is that the State

and/or its agencies/instrumentalities cannot give
largesse to any person according to the sweet will and
whims of the political entities and/or officers of the State.
Every action/decision of the State and/or its
agencies/instrumentalities to give largesse or confer
benefit must be founded on a sound, transparent,
discernible and well-defined policy, which shall be made
known to the public by publication in the Official Gazette
and other recognised modes of publicity and such policy
must be implemented/executed by adopting a non-
discriminatory and non-arbitrary method irrespective of
the class or category of persons proposed to be benefited
by the policy. The distribution of largesse like allotment
of land, grant of quota, permit licence, etc. by the State
and its agencies/instrumentalities should always be done
in a fair and equitable manner and the element of
favouritism or nepotism shall not influence the exercise
of discretion, if any, conferred upon the particular
functionary or officer of the State.

66. [Ed.: Paras 65, 66 and 68 corrected vide

Official Corrigendum No. F.3/Ed.B.J./23/2011 dated
3-5-2011 and para 67 corrected vide Official
Corrigendum No. F.3/Ed.B.J./28/2011 dated 7-5-
2011.] . We may add that there cannot be any policy,
much less, a rational policy of allotting land on the basis
of applications made by individuals, bodies, organisations
or institutions dehors an invitation or advertisement by
the State or its agency/instrumentality. By entertaining
 118

applications made by individuals, organisations or

institutions for allotment of land or for grant of any other
type of largesse the State cannot exclude other eligible
persons from lodging competing claim. Any allotment of
land or grant of other form of largesse by the State or its
agencies/instrumentalities by treating the exercise as a
private venture is liable to be treated as arbitrary,
discriminatory and an act of favouritism and/or nepotism
violating the soul of the equality clause embodied in
Article 14 of the Constitution.

67. [Ed.: Paras 65, 66 and 68 corrected vide

Official Corrigendum No. F.3/Ed.B.J./23/2011 dated
3-5-2011 and para 67 corrected vide Official
Corrigendum No. F.3/Ed.B.J./28/2011 dated 7-5-
2011.] . This, however, does not mean that the State can
never allot land to the institutions/organisations engaged
in educational, cultural, social or philanthropic activities
or are rendering service to the society except by way of
auction. Nevertheless, it is necessary to observe that once
a piece of land is earmarked or identified for allotment to
institutions/organisations engaged in any such activity,
the actual exercise of allotment must be done in a
manner consistent with the doctrine of equality. The
competent authority should, as a matter of course, issue
an advertisement incorporating therein the conditions of
eligibility so as to enable all similarly situated eligible
persons, institutions/organisations to participate in the
process of allotment, whether by way of auction or
otherwise. In a given case the Government may allot land
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at a fixed price but in that case also allotment must be

preceded by a wholesome exercise consistent with Article
14 of the Constitution.

68. [Ed.: Paras 65, 66 and 68 corrected vide

Official Corrigendum No. F.3/Ed.B.J./23/2011 dated
3-5-2011 and para 67 corrected vide Official
Corrigendum No. F.3/Ed.B.J./28/2011 dated 7-5-
2011.] . The allotment of land by the State or its
agencies/instrumentalities to a body/organisation/
institution which carry the tag of caste, community or
religion is not only contrary to the idea of secular
democratic republic but is also fraught with grave danger
of dividing the society on caste or communal lines. The
allotment of land to such bodies/organisations/
institutions on political considerations or by way of
favouritism and/or nepotism or with a view to nurture
the vote bank for future is constitutionally impermissible.

69.2. Thus, according to the Supreme Court, the State or

its instrumentalities cannot give largesse to any person

according to the sweet will and whims of the State. Every

action/decision of the State to give largesse or confer

benefit must be founded on a sound, transparent,

discernible and well defined policy which must be in the

public domain. Distribution of largesse like allotment of

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land should always be done in a fair and equitable manner.

There cannot be a policy, much less, a rational policy of

allotting land on the basis of applications made by

individuals or institutions etc., dehors an invitation or

advertisement by the State. By entertaining applications

from individuals, institutions etc., for allotment of land or

for grant of any other type of largesse, the State cannot

exclude other eligible persons from lodging competing

claim. Any allotment of land in the form of largesse by the

State would be arbitrary, discriminatory and an act of

favouritism violating Article 14 of the Constitution of India.

While acknowledging that the State has the authority to

allot land to institutions/organisations engaged in

educational and other public activities, Supreme Court

however cautioned that the actual exercise of allotment

must be done in a manner consistent with the doctrine of

equality.
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70. In the case of Humanity (supra), Supreme Court

frowned upon the practice of allotment of land dehors any

advertisement or public auction. When it was contended

that the allottee had bona fide intention of establishing a

school, Supreme Court referred to its earlier decision in

Akhil Bhartiya Upbhokta Congress (supra) and held that in

order to achieve a bona fide end the means must also

justify the end. Bona fide ends cannot be achieved by

questionable means when the State is involved.

71. Though, learned Advocate General strenuously tried

to distinguish the above judgments, we are of the view that

the above decisions would squarely apply to the facts and

circumstances of the case.

72. Learned Advocate General had placed reliance on the

decision in Moolchand Kharaiti Ram Trust (supra).

Question involved in the aforesaid case was regarding

validity of a circular of the Government of National Capital

Territory of Delhi directing the private hospitals to provide

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free treatment to the weaker sections of the society in

terms of a decision of the Delhi High Court. It was clarified

that all the hospitals which have been provided land by the

government would have to strictly follow the policy of

providing free treatment as directed by the Delhi High

Court. Supreme Court upheld such circular observing that

when State largesse is being enjoyed by the hospitals in the

form of land, it is their obligation to extend reciprocal

benefits to the public by providing free treatment as

envisaged in the circular. Having obtained land from the

government by claiming to be charitable institutions, the

hospitals cannot question the laudable objective of the

circular.

72.1. We fail to understand as to how the aforesaid

decision can come to the aid of the State in the present

case. Though learned Advocate General sought to justify

the land allotment to respondent No.10 as a policy

decision, we are unable to agree to such a contention. This

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is because there is already a policy vis-a-vis allotment of

government land in G.O.Ms.No.571 dated 14.09.2012 as

amended vide G.O.Ms.No.218, dated 01.12.2015.

However, it is evident that the State has acted in an

arbitrary and unreasonable manner while allotting land to

respondent No.10 in complete deviation from the

Government Land Allotment Policy, thus violating Article

14 of the Constitution of India.

73. Having come to the above conclusion, we may now

address one of the submissions made by Mr. S.Niranjan

Reddy, learned Senior Counsel for respondents No.10, 11

and 12. According to Mr. S.Niranjan Reddy, learned Senior

Counsel, construction of the hospital complex is going on

in full swing and may be concluded by September, 2023.

Therefore, he submitted that keeping in view the laudable

objective of establishing the hospital and the advanced

stage of construction, the court should not interfere with

the land allotment at this stage.

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74. We are unable to appreciate the above contention for

the simple reason that at the threshold, this court had

made it very clear vide the order dated 11.02.2021 that the

land allotted to respondent No.10 and any construction

raised by respondent No.10 over the said land would be

subject to outcome of the writ petition. Merely because

respondent No.10 has gone ahead with the construction

cannot be a ground to overlook the inherent illegality. It is

trite law that an interim order does not create any

additional right upon a litigant. In the circumstances,

respondent No.10 cannot seek any equity on the strength

of any construction.

75. Upon thorough consideration of all aspects of the

matter, we are of the view that the matter is required to be

reconsidered by the State Government strictly in

accordance with the Government Land Allotment Policy

contained in G.O.Ms.No.571 dated 14.09.2012 as amended

vide G.O.Ms.No.218, dated 01.12.2015.

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76. Consequently, we set aside G.O.Ms.No.59 dated

22.03.2018 as well as the Memo dated 02.08.2018 and

remand the matter back to the State for a fresh

consideration in accordance with law keeping in mind the

discussions made above.

77. Resultantly, the writ petition is allowed.

Miscellaneous applications pending, if any, shall

stand closed. However, there shall be no order as to costs.

______________________________________
UJJAL BHUYAN, CJ

______________________________________
B.VIJAYSEN REDDY, J

05.06.2023

Note: LR copy to be marked.

(By order)
vs/pln