RAMA JOIS, J. ( 1 ) IN these writ petitions, the petitioners have challenged the legality of the acquisition of land under the Provisions of the Land Acquisition Act ('the act' for short), in favour of certain house building co-operative societies, inter alia, on the ground that though apparently the acquisition of lands is stated to be for carrying out housing schemes sponsored by them for the benefit of their members, in truth, it is not so, and that the persons incharge of management of the society have joined hands with builders and contractors to do real estate business with the object of making enormous profit taking advantage of the demand for building sites in the city and inspite of the said factual position the state government has proceeded to acquire the land under the act and therefore the notifications arc liable to be quashed on the ground that it is an instance of colourable exercise of power. ( 2 ) EXCEPT for a few specific points raised, which are special to some of the petitions, there are general common questions of law and fact arising for consideration in these petitions and therefore they were heard together and are being disposed of by this common Order, ( 3 ) BRIEFLY stated the facts of the case in general, are as follows: the petitioners in each of the petitions are agriculturists, holding agricultural lands within the Bangalore city metropolitan area. Preliminary notifications under Section 4 of the act were issued proposing to acquire the lands belonging to them and others, in favour of the respondent-societies on various dates. Subsequently, final notifications were also issued under Section 6 of the act. The particulars relating to the issue of the notifications are as below: Date of preliminary notification Date of final notification Names of the sociciies in whose favour the land is acquired 17-12-1984 21-2-1986 Vyalikaval House Building Co-operative Society 12-7-1988 11-8-1989 H. M. T. Employees' Co-op. Society. 18-1-1985 28-2-1986 Bank Officers' Co-op. Society 16-9-1986 3-10-1987 REMCO Employees' House Building Co-op. Society 3-12-1986 8-1-1988 Amarajyothi Co-op. Society 4-9-1986 22-1-1988 Bangalore Chickpet House Building Co-op. Society , 6-11-1986 23-1-1988 Jayanagar House Building Co-op. Society. Society. 18-1-1985 28-2-1986 Bank Officers' Co-op. Society 16-9-1986 3-10-1987 REMCO Employees' House Building Co-op. Society 3-12-1986 8-1-1988 Amarajyothi Co-op. Society 4-9-1986 22-1-1988 Bangalore Chickpet House Building Co-op. Society , 6-11-1986 23-1-1988 Jayanagar House Building Co-op. Society. ( 4 ) THE learned counsel for the petitioners urged the following contentions: (1) in view of the classification of co-operative societies into two categories in the land acquisition Act, 1894, after its amendment in 1984, namely, those falling within the definition of the word 'state' under Article 12 of the Constitution of India and those falling within the meaning of 'company', the impugned acquisition is invalid, as according to part-vii of the Act, acquisition of land in favour of a company could be only for formation of sites and their distribution among the employees of a society. (2) even assuming that the lands could be acquired for formation of sites for distribution of sites among the members of a society, which is 'company' as defined under the Act, before giving consent for acquisition, the Karnataka land acquisition (companies) rules, 1973, ought to have been followed and as the same had not been followed, the impugned acquisition is invalid. (3) even on the basis that acquisition of land for a housing scheme prepared by a co-operative society, which is a company, is a public purpose and cannot be regarded as an acquisition for a company unless a housing scheme was prepared and submitted by the society concerned and the government accorded previous approval to such scheme, the acquisition would be invalid and in the present case as such a procedure was not followed, in that, no housing scheme was prepared and submitted for approval, the impugned acquisitions are invalid. (4) before granting previous approval and issuing preliminary notifications, the owners of lands should have been heard and as no such hearing was given, the approval given is invalid for violation of the rules of natural Justice and consequently the impugned acquisition is invalid. (5) the enquiry held under Section 5-a of the Act, was invalid, as the mandatory Provisions of the Karnataka land acquisition rules, in particular, Rule 7, which requires that the enquiry officer must consider and answer every objection raised by the land owners to the acquisition, was not complied with. (5) the enquiry held under Section 5-a of the Act, was invalid, as the mandatory Provisions of the Karnataka land acquisition rules, in particular, Rule 7, which requires that the enquiry officer must consider and answer every objection raised by the land owners to the acquisition, was not complied with. (6) the acquisition of land in favour of the respondent-house building societies, is not for allotment of sites to their bona fide members for their bonafide purpose, for the reason, these societies are indulging in big commercial venture of sale of sites for which purpose the societies have entered into agreements with builders and contractors and had enrolled large number of bogus members and associate members for achieving illegitimate object, and the decision of the state government to accord previous approval and sanction for acquisition of the land was bad not only on account of non-eonsideration of those relevant facts but also on the ground that the impugned acquisition is a clear case of colourable exercise of power. (7) the extent of large scale acquisition of land in favour of respondents-house building co-operative societies are such as would at once show that there has been large scale abuse and arbitrary exercise of power to acquire the lands under the Land Acquisition Act, which has the effect of circumventing and defeating the Provisions of the Bangalore development authority Act, 1976, under which the power and obligation to develop the city of Bangalore and areas adjacent thereto and mailers connccled therewith, and thereby rendering the Constitution of the Bangalore development authority purposeless. ( 5 ) ELABORATE arguments were addressed by the learned counsel for the petitioners in support of the above contentions. The learned counsel for the respondents submitted their arguments contesting each of the contentions. The learned government Advocate produced the relevant records. ( 6 ) AS the first and the second contentions are intimately connected, we deal with them together. In support of the same, the learned counsel for the petitioners submitted as follows: under the Provisions of the Act, as amended by act 68 of 1984, the co- operative societies registered under the relevant law regulating the co-operative sociclies have been classified into two categories, namely, those falling within the definition of the word "company" and those falling within the expression "corporation owned or controlled by the state". All co-operative societies in which 51 per cent of the paid up capital is held by the central government or by the state government or partly by central government or partly by one or more of the state governments, alone fall within the expression "corporation owned or controlled by the state". All other societies fall within the definition of the word "company". Each of the co-operative societies' concerned in these cases are those which fall within the definition of the word "company". Therefore, any acquisition of land in favour of the respondent-societies, could be only under chapter vii of the Land Acquisition Act providing for acquisition of land by companies. Under that chapter, in view of Section 40 of the Act, acquisition of lands could be only for the purposes of erection of dwelling houses for workmen employed by the company and therefore there can be no acquisition of lands in favour of a society which is a company, for the purpose of formation of layouts for distribution of sites among the members of the society. Even assuming that the land could be acquired for formation of sites among the members of a society, which is a company as defined under the Act, the procedure prescribed under Section 40 of the act read with the Karnataka land acquisition (companies) rules, 1973 ('the Companies Rules' for short), ought to have been followed and as the same was not followed, the acquisition is invalid. ( 7 ) AS against the above contention, the learned counsel appearing for the respondents contended that even after the amendment of the act by amending act 68 of 1984, which has classified the co-operative societies into two categories, it is clear from the definition of public purpose under Section 3 (f) (vi) of the Act, the acquisition for the purpose of executing a housing scheme sponsored by a co-operative society to which previous approval is given by the government, constitutes a public purpose and as in the present case the acquisition of lands in favour of each of the societies was for carrying out a housing scheme prepared by the society concerned and approved by the government, the acquisition was for a public purpose and consequently the Provisions of chapter-vii of the act and the Companies Rules were applicable. They also submitted that the matter is covered by the judgment of the division bench of this court in Naravana Raju v State of Karnataka, 1988 (3) KAR. LJ. 34 : ILR 1989 KAR. 376, which has been confirmed by the Supreme Court in the case of Narayana Raju v State of Karnataka, 1988 (3} KAR. LJ 8: ILR 1989 KAR. 406. ( 8 ) THE learned counsel for the petitioners, however, have strenuously contended in these petitions that after the amendment of the act in 1984, a clear change has been brought about in the matter of acquisition of land for co-operative societies, in that, acquisition of land only in favour of those societies in which the state or the central government, either jointly or severally, have contributed 51% or more of the paid up capital, which fall within the expression "corporation owned or controlled by the state", is regarded as for public purpose and in the case of acquisition in favour of any other society falling within the definition of the word "company" could be an acquisition only for the company and not for public purpose and therefore the acquisition could be only within the framework of the Provisions incorporated in part-vii of the act and this clear distinction brought about by the amending act was neither raised nor considered in the case of narayana rajut 1988 (3) KAR. L. J. 34: ILR 1989 KAR. 376. Bopanna, j. , Before whom the matter had come up for hearing, being of the view that the contentions raised by the petitioners were not raised or considered in the aforesaid judgment and being of the view that the questions raised were of considerable importance, referred these cases to division bench under Section 9 of the Karnataka High Court Act. ( 9 ) WE shall proceed to consider the first and the second contentions in the light of the amendments to the Land Acquisition Act by amending act 68 of 1984. Under the Act, prior to amendment, the expression "company" was defined under Section 3 (e) of the act. The relevant portion of the same reads: "3. ( 9 ) WE shall proceed to consider the first and the second contentions in the light of the amendments to the Land Acquisition Act by amending act 68 of 1984. Under the Act, prior to amendment, the expression "company" was defined under Section 3 (e) of the act. The relevant portion of the same reads: "3. Definitions in this Act, unless there is something repugnant in the subject or context xxx xxx xxx (e) the expression "company" means xxx xxx xxx (vi) a co-operative society; xxx xxx xxx (viii) a corporation created by or under any law for the time being in force in any part in India not being a corporation owned or controlled by the state. " The learned counsel for the petitioners relied on the judgment of the Supreme Court in the case of Valjibhai v State of Bombay, AIR 1963 SC 189. In the said case, the question for consideration was, whether the acquisition of land for the purpose of a state road transport corporation was bad for not following the Provisions contained in part-vii of the act. Incidentally, the question for consideration was, whether a road transport corporation established under the road transport Corporation Act, 1950, was a company. The Supreme Court held that a road transport corporation was also a company as defined in the act. On that basis, the Supreme Court held that following the procedure prescribed under chapter-vii of the Act, for the purpose of acquiring a land in favour of the corporation, was mandatory and not following the said provision rendered the acquisition invalid. Relying on the above decision, the learned counsel for the petitioners contended that the ratio of the aforesaid decision applies on all fours to the present case and therefore the acquisition of land in favour of co-operative societies which fall within the definition of the word "company" could be only after complying with the Provisions contained in part-vii of the act and the Companies Rules, and, as admittedly such a procedure has not been followed, the acquisition was invalid. ( 10 ) AS against the above contention, the learned counsel for the respondents submitted that acquisition of land even for a housing scheme in favour of a house building co-operative society was regarded as a public purpose even before the amendment of the act. ( 10 ) AS against the above contention, the learned counsel for the respondents submitted that acquisition of land even for a housing scheme in favour of a house building co-operative society was regarded as a public purpose even before the amendment of the act. In support of this the learned counsel relied on ihe judgment of the Supreme Court in Radial v State of Gujarat, atr 1970 SC 984, in which it was held that acquisition of land limited to the benefit of members of a co-operative society, was a public purpose. The learned counsel submitted that even after the act was amended by amending act 68 of 1984, the position continues to be the same in view of Section 3 (f) (vi) of the act. ( 11 ) IN order to appreciate the rival contentions, it is necessary to refer to ther elevant part of Section 6 of the act and the relevant part of the definition Section as amended. They read:"3. Definitionsin this Act, unless there is something repugnant in the subject or context xxx xxx xxx (cc) the expression "corporation owned or controlled by the state" means, any body corporate established by or under a central, provincial or State Act, and includes a government company as defined in Section 617 of the companies Act, 1956, a society registered under the societies Registration Act, 1860, or under any corresponding law for the lime being in force in a state, being a society established or administered by government and a co-operative society within the meaning of any law relating to co-operative societies for the time being in force in any state, being a co-operative society in which not less than fifty one per centum of the paid up share capital is held by the central government or by any state government or governments, orpartly by the central government andpartly by one or more state governments. (emphasis supplied) xxx xxx xxx (e) the expression "company" means xxx xxx xxx (iii) a co-operative society within the meaning of any law relating to cooperative societies for the lime being in force in any stale, other than a co-operative society referred to in clause (cc); (emphasis supplied) xxx xxx xxx (f) the expression "public purpose" includes xxx xxx xxx (iv) the provision of land for a corporation owned or controlled by the slate; xxx xxx xxx (vi) the provision of land for carrying out any educational, housing, health or slum clearance scheme sponsored by government or by any authority established by government for carrying out any such scheme, or with the prior approval of the appropriate government, by a local authority, or a society registered under the societies Registration Act, 1860, or under any corresponding law for the time being in force in a state or a co-operative society within the meaning of any law rela ting to co-operative societies for the time being in force in any stale. Xxx xxx xxx6. Declaration that land is required for a public purpose: (1) subject to the Provisions of part vii of this Act, when the appropriate government is satisfied, after considering the report, if any, made under Section 5-a, sub-section (2) that any particular land is needed for a public purpose or for a company, a declaration shall be made to that effect under the signature of a secretary to such government or of some officer duly authorized to certify its orders and different declarations may be made from time to lime in respect of different parcels of any land covered by the same notification under Section 4, sub-section (1), irrespective of whether one report or different reports has or have been made wherever required under Section 5-a, sub-section (2 ). (emphasis supplied) xxx xxx xxx provided further that no such declaration shall be made unless the compensation to be awarded for such properly is to be paid by a company, or wholly or partly out of public revenues or some fund controlled or managed by a local authority. "as can be seen from Section 6, the acquisition of land could be, for a public purpose or for a company. "as can be seen from Section 6, the acquisition of land could be, for a public purpose or for a company. According to the proviso to Section 6 (1), in the case of acquisition of land for a company, the compensation to be awarded to the owner of the land has to be paid by the company and in the case of acquisition of land for a public purpose, the compensation has to be paid wholly or partly out of public fund or out of a fund controlled or managed by a local authority. If the acquisition in favour of a cooperative society can be regarded as acquisition for a company, the contentions of the petitioners that part-vii ought to have been followed, is unexceptionable. But the contention of the respondents is that acquisition of lands for the purpose of carrying out a housing scheme prepared by a society which falls within the definition of the word "company" with the previous approval of the state government, constitutes public purpose as expressly defined in the act after the amendment and therefore there was no necessity to follow the Provisions contained in part-vii of the act. As can be seen from the amended definition, all the co-operative societies have been classified into two categories, namely, (1) those societies in which not less than 51 per cent of the paid up share capital is held by the central government or any state government or partly by the central government and partly by one or more state governments, falling under Section 3 (cc), and (2) the societies other than those falling under Section 3 (cc ). The second category of societies alone fall within the definition "company". In other words, all co-operative societies which fall within the definition of the word " stale" under Article 12 of the Constitution have been classified under the head "corporation owned or controlled by stale" and the rest of the societies fall within the meaning of the word "company". Now coming to the definition under section- 3 (f), it expressly provides that public purpose includes the provision of land for a corporation owned or controlled by the state. From this, it is clear that acquisition of land for any purpose in favour of a co-operative society, which falls within the expression "corporation owned or controlled by the state", would be a public purpose. From this, it is clear that acquisition of land for any purpose in favour of a co-operative society, which falls within the expression "corporation owned or controlled by the state", would be a public purpose. In other words, whether the purpose is for construction of administrative buildings or for construction of residential houses for its employees or for any of its purpose, it would be a public purpose. However, under Section 3 (f) (vi) in so far it relates to societies other than those falling under the expression "corporation owned or controlled by the state", the acquisition of land would be for a public purpose if only it is for purposes specified in Section 3 (vi) of the act. If it is for any purpose other than those specified in Section 3 (vi), then certainly part-vii of (he act would be attracted and have to be complied with. Thus, il is clear that as far as acquisition of!and for the purpose of carrying out a housing scheme sponsored by a co-operative society which is "company" as defined in Section 3 (e) of the Act, which has secured previous approval of the government, it would constitute public purpose even after the amendment. The relevant portion of the judgment of the Supreme Court in narayana raju, 1988 (3) KAR. L. J. 8 : 1lr 1989 KAR. 406, confirming the decision of this court in the case of narayana raju, 1988 (3) KAR. Lj. 34: ILR 1989 KAR. 376, reads:"2. After hearing counsel, we are satisfied that no question of law of any substantial importance arises in these appeals which requires to be determined by us. The facts found show that the acquisition was for the purpose of carrying out a housing scheme by a co-operative society within the meaning of the law relating to the co-operative societies in force in the slate of karnalaka. That purpose was a public purpose under the Land Acquisition Act, 1894, before its amendmcnl in 1984 as well as after that amendment. Hence, the question whether the purpose of acquisition in this case was a public purpose is a simple question answer to which is quite clear and it must be in the affirmative. This question, therefore, cannot be said to be a substantial question of law at all. Xxx xxx xxx 3. Hence, the question whether the purpose of acquisition in this case was a public purpose is a simple question answer to which is quite clear and it must be in the affirmative. This question, therefore, cannot be said to be a substantial question of law at all. Xxx xxx xxx 3. In the circumstances, the certificate granted by the high court is revoked and the appeals are dismissed. There will be no order as to costs. "from the above decision, it is clear that in so far it relates to acquisition for a housing scheme sponsored by a co-operative society which is "company" as defined under Section 3 (e) of the Act, it would be a public purpose provided previous sanction to such a scheme is given by the state government. If il is for any purpose other than the purpose specified in Section 3 (0 (vi), then the acquisition would be for a company and 'part-vii of the acl and the compantcsrules have to be complied with it is not di puled that previous sanction has been given by the government for the housing scheme sponsored by the co-operative society concerned. It is true that the legality of the previous sanction itself is questioned on the ground that il is a clear case of colourable exercise of power and it is also the contention of the petitioners that there is no valid housing scheme for whieh approval could have been given by the government and further in any event approval could not have been given without giving an opportunity of hearing to the pelilioners. These are separate questions which we consider separately. Whatever be ihe merits of those contentions, we find no substance in the first and the second contentions urged for the petitioners. They are rejected. ( 12 ) THE third contention urged for the petilioners is that even assuming that the acquisilion of land for ihe purpose of executing a housing scheme sponsored by a co-operalivc society, which is "company" as defined in seclion 3 (e) of the act could be a public purpose, unless ihere is a housing scheme prepared by the society concerned and such a scheme is approved by the state government, the acquisition would not be for a public purpose. Elaborating the contention, the learned counsel submitted as follows: in each of the cases, no housing scheme worth the name had been prepared by any of the societies. All that the society concerned stated before the government was that they required certain extent of land for formation of house sites and the state government accorded approval for the acquisition of land. That in order that acquisition of land in favour of a co-operative society is a public purpose, it is mandatory that a housing scheme should be prepared and submitted to the government. Though no specific rules have been framed by the government under the act prescribing the contents of a scheme, assistance could be taken from the relevant Provisions of the karnalaka housing board act and the Bangalore development authority Act, in particular, the learned counsel invited our attention to Section 18 of the Karnataka housing board Act, which reads:"18. Matter to be provided for by housing schemes: notwithstanding anything contained in any other law for the time being in force, a housing scheme may provide for all or any of the following matters, namely: (a) the acquisition by purchase, exchange or otherwise of any property necessary for or affected by the execution of the scheme; (b) the laying or relaying out of any land comprised in the scheme; (c) the distribution or re-distribution of sites belonging to owners of property comprised in the scheme;xxx xxx xxx (h) the construction and alteration of streets and back lanes; (i) provision for the draining, water supply and lighting of the area included in the scheme and carrying out by the board in such area, drainage, sewerage and water supply works; (j) the provision of parks, playing-fields and open spaces for the benefit of any area comprised in the scheme and the enlargement of existing parks, playing fields, open spaces and approaches; (k) the provision of sanitary arrangements required for the area comprised in the scheme, including the conservation and prevention of any injury or contamination to rivers or other sources and means of water-supply. "they also relied on Section 16 of the B. D. A. Act, which reads:"16. "they also relied on Section 16 of the B. D. A. Act, which reads:"16. Particulars to be provided for in a development scheme every development scheme under Section 15 (1) shall, within the limits of the area comprised in the scheme, provide for- (a) the acquisition of any land, which in the opinion of the authority, will be necessary for or affected by the execution of the scheme; (b) laying and re-laying out all or any land including the construction and re-construction of buildings and formation and alteration of streets; (c) drainage, water supply and electricity; (d) the reservation of not less than fifteen per cent of the total area of the layout for public parks and playgrounds and an additional area of not less than ten per cent of the total area of the layout for civic amenities; (2) may, within the limits aforesaid, provide for (a) raising any land which the authority may consider expedient to raise to facilitate better drainage; (b) forming open spaces for the better ventilation of the area comprised in the scheme of any adjoining area; (c) the sanitary arrangements required; (3) may, within and without the limits aforesaid provide for the construction of houses. "the learned counsel submitted that in both these enactments, the legislature has laid down as to what should be the contents of a housing scheme or layouts and unless such a scheme was prepared and submitted and the same was approved by the government, the acquisition could not be regarded as for a public purpose. ( 13 ) THE learned counsel for the respondents-societies, per contra, submitted that in the absence of any specific rules prescribed under the act by the government prescribing the rules for preparing a housing scheme for the purposes of according previous approval under Section 3 (f) (vi) of the Act, it cannot be contended by the petitioners that the housing scheme in terms of the Provisions of Section 18 of the Karnataka housing board act or in terms of Section 16 of the B. D. A. Act, ought to have been prepared and submitted to the slate government for its approval. The learned counsel submitted that in each of the cases, the respondent-societies had furnished the number of members, the number of sites, their dimensions and the total area which could be acquired making due allowance for formation of roads and civic amenities etc. The learned counsel submitted that in each of the cases, the respondent-societies had furnished the number of members, the number of sites, their dimensions and the total area which could be acquired making due allowance for formation of roads and civic amenities etc. , In accordance with the Provisions of the B. D. A. act. They also submitted that a detailed plan in terms of Section 16 of the B. D. A. act would become necessary and would be submitted to the Bangalore development authority before seeking its approval to the layout, for the reason, within the area of the Bangalore development authority, in which the lands acquired in favour of each of the societies situate, the prior approval of the Bangalore development authority for any private layout is mandatory under Section 32 (2) of the B. D. A. act. The learned counsel for the respondent-societies as also the learned counsel appearing for the government, submitted that in each of the cases, a three-man committee was constituted by the government, which had gone into the requisition made by each of the societies and the committee had recommended acquisition of lands and only thereafter the government has given previous approval. ( 14 ) AFTER giving careful consideration to the question, we are of the view that until and unless specific rules are framed by the government requiring as to what are the particulars lo be mentioned in an application by a co-operative society before the government seeking its prior approval for a housing scheme, it is not possible lo hold that the particulars as required under Section 18 of the housing board act or sections 16 and 32 (2) of the B. D. A. act should be complied with at the stage of seeking previous approval of the government to the scheme. But at the same time, it cannot be said that mere requisition by a co-operative society, which is a company, stating that it requires certain extent of lands for the purposes of a housing scheme, would meet the requirements of Section 3 (f) (vi) of the act. It is, however, for the government, before granting previous sanction, to consider as to whether the particulars given are sufficient to treat the scheme as a housing scheme and lo lake a decision in the matter. It is, however, for the government, before granting previous sanction, to consider as to whether the particulars given are sufficient to treat the scheme as a housing scheme and lo lake a decision in the matter. We, however, of the view that in order to ensure the proper exercise of power of according previous approval by the government, it would be belter thai the government frames the rules for that purpose. We, however, consider unnecessary to go furlher into this contention, in view of our conclusion on the sixth contention,which we are considering later. ( 15 ) THE fourth contention urged for the petitioners was that before granting previous approval and issuing preliminary notification, the owner of the lands proposed to be acquired, should have been heard and as no such hearing was given, the approval given is invalid for violation of the rules of natural Justice and consequently the impugned acquisition is invalid. ( 16 ) ELABORATING the above contention, the learned counsel stated as follows: in view of the amendment to the Land Acquisition Act, according to which the acquisition of land for carrying out a housing scheme sponsored by a co-operative society becomes a public purpose only on the according of prior approval of the government, it was obligatory for the government to comply with the rules of natural Justice before according previous approval. The learned counsel submitted that it is well established principle in administrative law that no decision resulting in civil consequences against any individual could be taken without complying with the Rule of audi alteram pattern. The learned counsel submitted that actually the government ought lo have framed rules similar to the Companies Rules which require the government to give opportunity to the owners of land to have their say before giving consent lo the acquisition of land in favour of a company under part- vii of the act. The learned counsel submitted that there can be no difference between giving consent for acquisition of land in favour of a "company" falling under part-vii of the act and in giving previous approval in favour of a co-operative society which is a "company" under Section 3 (f) (vi) of the act. In support of their contention, the learned counsel relied on the decision of the Supreme Court in the case of state of Gujarat v Chalurbhai, AIR 1975 SC 629 . In support of their contention, the learned counsel relied on the decision of the Supreme Court in the case of state of Gujarat v Chalurbhai, AIR 1975 SC 629 . In the said decision, the Supreme Court has laid down that before issuing preliminary notification under Section 4 of the Act, proposing to acquire land for a company it was obligatory for the government to give an opportunity lo the owners of land and if no such opportunity was given, the acquisition would be illegal. The Supreme Court also held that inquiry under Section 5-a was entirely different and the fact such an inquiry was held could not cure the defect of not giving opportunity lo owners of land before giving consent for the acquisition of land in favour of a company. The learned counsel submitted that the same principle must apply and therefore before according the previous approval, the state government should give an opportunity of hearing to the owners concerned. The learned counsel also relied on the decision of the Supreme Court in General Government Servants Co-operative Housing Society v Kedarnath, 1981 (2) SCC 352 , in which the same view was reiterated. ( 17 ) THE ratio of the two decisions of the Supreme Court, fully supports the contention of the petitioners that before according previous approval, it is obligatory for the government to give an opportunity of hearing to the owners of the land and if no such opportunity is given, the preliminary notification as well as the final notification would become invalid. The fact that rules have been made in respect of the procedure to be followed before giving consent for the acquisition of land in favour of a company and no such rules have been framed in the matter of giving previous approval for acquisition of land in favour of a co-operalive society which is a company, in our opinion, does not make any difference, for, Rule 4 of the Companies Rules incorporate the rules of natural Justice and in the absence of rules, rules of natural Justice supplement the rules. In other words, it should be regarded as superaddcd to ihe law in view of the ratio of the decision in A. K. Kraipak v Union of India, AIR 1970 SC 150 . ( 18 ) THE learned counsel for the respondents, however, submitted that the Supreme Court in mis. In other words, it should be regarded as superaddcd to ihe law in view of the ratio of the decision in A. K. Kraipak v Union of India, AIR 1970 SC 150 . ( 18 ) THE learned counsel for the respondents, however, submitted that the Supreme Court in mis. Fomento Resorts and Hotels Limited v Gustavo Ranato da cruz pinto, AIR 1985 SC 736 , has considered and explained the decision on which the petitioners rely and held that while giving an opportunity of hearing to the owners before giving consent for the acquisition of land in favour of a company was mandatory is need not always be prior to the issue of preliminary notification under Section 4 of the Act, but it could form part of an enquiry under Section 5-a of the act. ( 19 ) THOUGH, in view of the earlier decision of the Supreme Court the contention of the petitioners is sound, in view of the later decision, the petitioners cannot contend that they should have been given opportunity of hearing before issuing the notification under Section 4 of the Act, for, in view of the ratio of the later judgment, the petitioners are entitled to be heard on all points in the course of an enquiry under Section 5-a of the act. In the circumstances, we find no substance in the fourth contention urged for the petitioners, and the same is rejected. ( 20 ) THE fifth contention of the petitioners is that the inquiry held and the report submitted under Section 5-a of the act did not conform to Rule 7 of the Karnataka land acquisition rules, which are mandatory, as held by the Supreme Court in the case of State of Mysore v V. K. Kangan, AIR 1975 SC 2190 . Rule 7 reads: -"7. Deputy commissioner to report to government - on completion of his enquiry, the deputy commissioner shall before the expiry of six weeks from the last date for filing objections or before the expiry of two weeks from the date on which he receives the report under sub-section (4) of Section 4 whichever is later submit his report and recommendations as to each objection, whether admissible or inadmissible, for the orders of government under sub-section (2) of Section 5. "the learned counsel submitted that the report did not cover all the objections and therefore was violative of Rule 7 and consequently the final notification was illegal. The sixth contention urged for the petitioners is that the acquisition of land in favour of each of the respondents-co-operative societies, was not for allotment of sites for their bona fide members for their bona fide purpose, but actually these societies were indulging in big commercial venture with profit motive, for which purpose the societies had entered into agreements with builders and contractors and had enrolled large number of bogus members and the state government had either winked at or had failed to consider these relevant facts before according previous approval to the acquisition of land hi favour of each of the societies and therefore the impugned acquisitions were illegal. ( 21 ) WE proceed to consider the sixth contention in the first instance. With reference to the above contention, the relevant portion of the averments made in writ petition Nos. 7683 to 7699 of 1988, in which the acquisition of lands in favour of vyalikaval house building co-operative society had been challenged, reads: "in recent years some rich persons who have amassed unaccounted black money have been investing their money on high rise buildings and building sites in Bangalore city, with the object of converting their black money into white money. Some of them, with the help of estate agents have been making use of the housing societies in Bangalore for acquiring building sites in the names of the societies. According to the government records there are about 128 housing co-operative societies in Bangalore city. The members of the majority of these societies are persons not belonging to this state. Nor are they residents of Bangalore city. Since the last about 10 years, vast areas of agricultural lands belonging to small farmers in and around Bangalore city have been acquired by the 1st respondent for the benefit of the housing co-operative societies. Allegations are frequently heard that there is a big racket behind these acquisitions for the so-called house building societies and that corrupt politicians, corrupt bureaucrats and estate agents collaborate together in this racket. Allegations are frequently heard that there is a big racket behind these acquisitions for the so-called house building societies and that corrupt politicians, corrupt bureaucrats and estate agents collaborate together in this racket. Allegations also frequently heard that political parties in power in this state have been collecting large sums of money from these housing societies in the name of the 'parly-fund' in consideration of granting sanction for the acquisition of lands. 4. The 4th respondent-society was formerly advancing loans to its members to construct houses. In recent years, with the backing of the estate agents and black money magnates it has been acquiring agricultural lands under the garb of distributing housing sites to its members. Xxx xxx xxx the petitioners submit that the 4th respondent-house building co-operative society is not a bona fide house building co-operative society at all, it is a false front created by a few individuals with the sole object of grabbing the lands for the purpose of amassing wealth at the cost of the poor owners of. The lands like the petitioners herein. The petitioners learn and believe it to be true that when the 4th respondent-house building co-operative society, moved the authorities for acquisition of the lands in their favour, the said society had not a single member, except those who sponsored the society. It was after the application for acquisition of the lands was made by the society, the so-called promoters, by name M/s. , mookambika associates went round the city and even outside in search of members, approaching the various site seeking individuals and procured applications from them for the grant of house sites. The membership applications from the various individuals were also collected by the 4th respondent-society, itself by painting the glorious picture of the activities of the society and attracting the clients to the proposal. Further, the 4th respondent-house building co-operative society, has also employed various agents to induce the site seekers to make their applications. Several persons, who are in dire need of house sites, had only made their application for the allotment of the house sites, at that time their membership to the society was procured by the so-called promoters of the 4th respondent merely as a formality. The members of the society are not concerned really with their membership but they are concerned with the allotment of house sites in their favour. The members of the society are not concerned really with their membership but they are concerned with the allotment of house sites in their favour. The so-called members of the 4th respondent-house building co-operative society, are not the members in reality but they are only the applicants for house sites. Xxx xxx xxx the petitioners submit that the lands in and around the city of Bangalore have become very valuable and certain vested interests, taking advantage of the situation, have created so many house building co-operative societies as a false-front for the purpose of grabbing the lands and thereby amass wealth. The 4th respondent-vyalikaval house building co-operative society, is one of such false-front. The activities of trading on the lands belonging to the poor agriculturists are a very good money making trade and therefore all the powerful elements, both in public life and bureaucracy, have combined together in this land trading and colluding with the so-called house building co-operative societies for the simple reason that everyone who is involved in such activities can become extra rich overnight. Xxx xxx xxx in furtherance of the object of the said conspiracy, the state of Karnataka, with the object of hood-winking the general public, appointed a 3 men committee for the alleged purpose of scrutinising the applications of the house building co-operative societies for acquisition of the lands and to determine the extent of the lands required to be acquired in favour of each society for providing house sites to its members. The appointment of the said three-men committee is again a fraud on law and public because it was handy to the government, the 1st respondent herein, to get any extent of lands acquired in favour of the house building co-operative societies, through the three-men committee, which was only playing lackey to the dictates of its political bosses. In fact, the three-men committee, never took a decision on its own but it was only functioning as per the dictates of the external forces. Xxx xxx xxx the petitioners submit that the modus-operandi of the 4th respondent and also the similar other house building co-operative societies, was to get the notification for land acquisition under Section 4 (1) of the Land Acquisition Act issued through the government by spending huge amount through their agents. The agents who were several in numbers, were the link between the government and the house building co-operative societies. The agents who were several in numbers, were the link between the government and the house building co-operative societies. The agents used to undertake that they will get the lands acquired, layout plans approved etc. , And to get all clearance from the government for certain amount of money, fixed on average basis, and it was through the said agents the house building co-operative societies, in this case the 4th respondent, got the 4 (1) notification issued. After the issuance of the 4 (1) notifications, the agents used to approach the land owners, whose lands are proposed to be acquired, with an offer to purchase those lands for higher rates if only the owners are agreed to sell those lands to the house building co-operative societies. The owners of the lands concerned, who are scared because of the proposal for the acquisition of the lands, were pressurised by the agents to sell their lands and in such pressures, the gullible, uneducated, helpless poor agriculturists blindly submitting to the dictates of the agents, agreed to sell their lands for some higher price than what they actually get if their lands are acquired and the agents of the 4th respondent-co-operative society, paid advances towards the purchase money to the owners of the lands and obtained in several cases, the signatures on the blank papers by way of vouchers for the amount already paid. Xxx xxx xxx the circumstances makes it clear that the notification under Section 4 (1) of the Land Acquisition Act would be issued primarily for the purpose of scaring the owners of the lands and pressurise them to submit to the dictates of the 4th respondent-house building co-operative society, and several other such societies through their agents. The 4th respondent also used to pay huge amount to their agents to be spent as illegal gratification to the various authorities and obtain the signatures of the agents to the stamped blank papers to create receipts for unproportionale higher amount than what was actually paid to the agents. Xxx xxx xxx the 4th respondent has entered into an agreement with their agents by name Sri Narasimha Murthy and Sri Ramu to acquire 3 acres and 10 guntas of lands in lottegollahalli and paid Rs. 3,67,000 to the agents. Xxx xxx xxx the 4th respondent has entered into an agreement with their agents by name Sri Narasimha Murthy and Sri Ramu to acquire 3 acres and 10 guntas of lands in lottegollahalli and paid Rs. 3,67,000 to the agents. The petitioners learn and believe it to be true, the 4th respondent further made payment of 15 lafchs of rupees to the agents in this connection. But, the fact remains that the said lands were already acquired by the Bangalore development authority for raja mahal vilas extension II stage and the said land was not at all available for the 4th respondent-house building co-operative society. " In support of the allegations, the petitioners have produced the following documents: (1) an agreement entered into between the owner of certain agricultural lands acquired in favour of the society and k. v. narayan construction company private limited, which is stated to be similar to several such agreements entered into by the agent of the society. The relevant portion of the same reads:"this agreement of sale executed by chikkahottappa, residing at cholanayakanahalli, Bangalore north taluk, hereinafter referred to as the vendor of the one part, which term shall mean and include his heirs, legal representatives, administrators and assigns in favour of Sri K. V. Narayan construction co. (p) Ltd. , No. 95, 11th cross road, malleswaram, Bangalore-560 003, hereinafter called the 'purchaser' of the other part, witnesseth as follows; whereas, the vendor is the absolute owner of lands situated in survey number 34/6 at cholanayakanahalli kasaba hobli, Bangalore north taluk, more fully described in the schedule hereunder and whereas the purchaser approached the vendor for sale of the said land and whereas the vendor has agreed to sell the same for a sum of Rs. (rupees on the following terms and conditions. Xxx xxx xxx 3. The vendor agrees not to file any objection in the event the lands are proposed to be acquired by the Bangalore development authority for the members of the vyalikaval house building co-operative society Ltd. , Bangalore. Xxx xxx xxx 6. The vendor has delivered vacant possession of the land this day in part performance of this agreement. The vendor agrees not to file any objection in the event the lands are proposed to be acquired by the Bangalore development authority for the members of the vyalikaval house building co-operative society Ltd. , Bangalore. Xxx xxx xxx 6. The vendor has delivered vacant possession of the land this day in part performance of this agreement. " (2) an advertisement issued for and on behalf of vyalikaval house building co-operative society inviting persons to have mansions in the city of Bangalore, which gives the particulars of the builders with whom the society has entered into an agreement and which also gives the name and address of a middle-east representative at dubai, which reads: "an invitation to make your mighty mansion in Bangalore the garden city of India the vyalikaval house building co-operative society Ltd. 's yet another prestigious project Promoters: Consultants: Mookambika Associates, 1 158, V Main, II Stage, Rajajinagar, Bangalore - 560 010 Consulting Architects: Kulkarni Consultants, 111/2, 2nd Block, Railway Parallel Road, Kumara Park West, Bangalore - 560 020. Phone: 367368 Bhagya Commercial Corporation, 8/4, National High School Road, Bangalore - 560 004 Phone: 604447 Middle East Representative: Mr. K. Ravishankar, P. O. Box 9406, Dubai, UAE. Phone: 662031 (3) a letter addressed by bhagya commercial corporation inviting individuals to have residential flats in bannerghatta road, that is, on the lands acquired for society. It reads: "bhagya commercial corporation, real estate division consulting architects: kulkarni consultants, 111/1, 2nd block, railway parallel road, kumara park west, Bangalore-20. Dear friend, re: residential plots in bannerghatta road we have great pleasure in offering an opportunity to own residential plots on bannerghatta road (near J. P. Nagar, II phase ). The layout is being promoted by M/s. Mookambika associates and managed by the vyalikaval house building co-operative society limited. (emphasis supplied) xxx xxx xxx location of belakahalli project: now open for booking: belakahalli on bannerghatta road, one kilo metr. From drive-in-theatre. Xxx xxx xxx come to bhagyas to reserve the allotment of sites: 1. By becoming member of the vyalikaval house building co-operative society Ltd. 2. By paying advance deposit. SCHEDULE Size in ft. No. of sites Sq. Yds. per site Amount at Rs. 160/- Sq. Yd. Advance Deposit 80x120 100 1066. 66 Rs. 1,70,665/- Rs, 50,000/- 60x90 150 600. 00 Rs. 96,000/- Rs. 40,000/- 50x80 150 444. 44 Rs. 71,110/- Rs. 35,000/- 40x60 600 266. 66 Rs. 42,665/- Rs. By paying advance deposit. SCHEDULE Size in ft. No. of sites Sq. Yds. per site Amount at Rs. 160/- Sq. Yd. Advance Deposit 80x120 100 1066. 66 Rs. 1,70,665/- Rs, 50,000/- 60x90 150 600. 00 Rs. 96,000/- Rs. 40,000/- 50x80 150 444. 44 Rs. 71,110/- Rs. 35,000/- 40x60 600 266. 66 Rs. 42,665/- Rs. 20,000/- 30x50 400 166. 66 Rs. 26,665/- Rs. 15,000/- 30x45 150 150. 00 Rs. 24,000/- Rs. 12,000/- 30x40 150 133. 33 Rs. 21,332/- Rs. 10,000/- all prospective buyers have to make the advance deposit mentioned in the schedule. The balance amount will be taken in 3 instalments depending on the progress of the layout formation work as estimated below. Xxx xxx xxx for enrolment and procurement of the sites please contact: consultants, bhagya commercial corporation, 874, national high school road, Bangalore - 560 004. Phone: 604447. " Sri A. K. Subbaiah, the learned counsel appearing for Sri Kadidal Manjappa, the learned counsel for the petitioners made a scathing attack against the decision of the government to acquire the lands in favour of respondent-societies. He submitted tha t the relevant material would show that the acquisition of land was not for the purpose of bonafide housing scheme by the housing society, but was for the purpose of making huge profits by the office bearers of the societies and the builders and contractors concerned by exploiting the existence of great demand for sites in the city of Bangalore. He submitted that large number of bogus members have been inducted as associate members of the society and out of them the address of large number of persons given was none other than the address of the president of the society itself and the slate government had failed to take into consideration all these factors which had received wide publicity and without considering these relevant factors, which would have proved to the hilt that the acquisition of land sought for by the society was not for a bona fide housing scheme for the bona fide members of the society. He submitted that agreements for purchase of agricultural lands in favour of the societies, were entered into by its agents which was void in view of Section 79-b of the Land Reforms Act which prohibited a co-operative society from owning agricultural lands. He submitted that agreements for purchase of agricultural lands in favour of the societies, were entered into by its agents which was void in view of Section 79-b of the Land Reforms Act which prohibited a co-operative society from owning agricultural lands. He also submitted that the society had entered into agreements with the agents to pay huge sums of money for influencing the government and to get preliminary and final notifications issued under sections 4 and 6 of the act and thereby come to the rescue of these societies which have been indulging in illegal activities and that the government yielded to such influence and accorded approval for the acquisition of lands in favour of the societies. He therefore submitted that the impugned notifications were liable to be declared invalid for non-consideration of true and relevant facts and also on the ground that it was a clear case of colourable exercise of power. ( 22 ) SRI Siddaraju, the learned counsel for the petitioner in writ petition nos. 12504 to 12511/1988 concerned h. m. t. society made similar submissions in respect of acquisition of land in favour of that society. In addition also referred to the relevant portion of the agreement entered into between the society and its agents, which reads: "this agreement made and entered into this first day of february, one thousand nine hundred eighty five between the hmt employees' co-operative house building society Ltd. , Bangalore-560 031, represented by its president and hon. Secretary (duly authorised by the board to enter into this agreement) hereinafter called as the first party and M/s. S. r. constructions, 234/a, 6th cross road, gandhinagar, Bangalore - 560 009, represented by its managing partner, Sri S. Ramachandran, hereinafter called the second party which term shall mean and include the successor in office witnesseth as follows:2. Whereas the first party is a registered house building co-operative society under the Karnataka Co-Operative Societies Act, its main object being to procure lands around Bangalore and forming layouts and sites to cater to the needs of its members by allotting sites for purposes of construction of dwelling houses on the sites and the second party is an architects, engineers, builders and layout contractors. 3. 3. And whereas the second party approached the first party and offered to assist the first party to secure lands in thindlu and chikkabettahally villages to the extent of 80 acres approximately as specified in the Annexure to this agreement and to get the lands acquired in favour of the first party and further offered to take up the work of layout and formation of sites so formed through the B. D. A. and/or from any other competent authority. 4. And whereas at on a representation from the first party the second pan with ins efforts has secured directions from revenue secretary, government kamataka, addressed to the special d. C, Bangalore, to issue notification under Section 4 (1) of (he land acquisition ad in favour of the first party-society vide No. Rd 257 aqb 84, dated 7-11-1984. (emphasis supplied) the second party shall secure to the first party lands at thindlu and chikkabettahally to an extent of 80 acres as specified in the Annexure to this agreement to begin with and such further extent as the first party may require and shall arrange for agreements to be executed between the owners of such lands and the first party within a period of 2-3 months from this day to facilitate the acquisition of lands in favour of the first party. The second party hereby agrees strictly to conform and act according to the terms of this agreement. (emphasis supplied) xxx xxx xxx2. The second party hereby agrees strictly to conform and act according to the terms of this agreement. (emphasis supplied) xxx xxx xxx2. It is agreed that in respect of the lands to be acquired for the first party the second parly shall undertake to do the following: a) to get notification under Section 4 (1) of the Land Acquisition Act issued for acquisition of the required extent of land mentioned in the Annexure for the first party in thindlu and chikkabeltahally villages, in one continuous plot and enter into necessary agreements with the owners of the land confinning that the lands are free from encumbrance and that there are no claims on the lands and that they have no objection for the acquisition proceedings in respect of the land; b) to get the notification as required under Section 4 (1} to be issued within 3 months from the date of agreement with land owners;c) to get the enquiry as required under Section 5 (1) of the Land Acquisition Act by proper authorities completed within 3-4 months from the date of agreement with land owners;d) to get the notification as required under Section 6 (1) of the Land Acquisition Act within 10 months from the date of the agreement. (emphasis supplied)XXX xxx xxx5. The first party has agreed to pay the second parly the agreed amount calculated at Rs. 112/- only per sq. Yard, as stipulated under clause (4) in the following mode:6. It is agreed by the parties that part of the amounts advanced below to the second parly are towards payment to the land owners. A. Payment made on 21-10-1984 vide cheque No. 972975, dated 20-10-1984 for Rs. 10. 00 lakhs (rupees ten lakhs only) drawn in favour of state bank of mysore, west of chord road and for which bank guarantee for Rs. 10. 00 lakhs has been provided. Rs. 10. 00 lakhs b. Payment made on 1-2-1985 vide cheque No. 971037, dated 1-2-1985 for Rs. 15. 00 lakhs (rupees fifteen lakhs only) to wards processing and securing Section 4 (1) notification and also to make advance to land owners. Rs. 15. 00 lakhs c. Within one month from the issue of notification under Section 4 (1) of the l. a. act. Rs. 15. 00 per sq. Yd d. Demands made by the government for depositing the probable cost of acquisition or actuals. Rs. 10. 00 per sq. Rs. 15. 00 lakhs c. Within one month from the issue of notification under Section 4 (1) of the l. a. act. Rs. 15. 00 per sq. Yd d. Demands made by the government for depositing the probable cost of acquisition or actuals. Rs. 10. 00 per sq. Yd. C. After issue of Section 6 ( 1) final notification and pass awards under Land Acquisition Act finalisation of acquisition proceedings. Rs. 10. 00 per sq. Yd. (emphasis supplied) the learned counsel submitted that the agreement entered into between the societies and the builders in which huge amounts were passed on to the agents to get the preliminary and the final notifications issued from the government, which are contracts opposed to public policy, speaks volumes about the real motive for acquisition of lands in the guise of requirement for a housing scheme sponsored by the society. The learned counsel submitted that the above facts and in particular the agreement was sufficient to declare that the decision of the government to acquire the land was an instance of colourable exercise of power and therefore illegal and invalid. 22-a. In respect of the other societies also, it is alleged that the acquisition was not for bona fide purpose of a housing scheme for bona fide members, but they were indulging in the house site business for the purposes of making money and each of the six respondent-societies have entered into agreements with builders/agents for getting the preliminary and final notifications issued as was the case in the case of vyalikaval society and h. m. t. employees' co-operative society. ( 23 ) THE learned counsel for the petitioners submitted that the modus operandi of the office bearers of the societies and their agent was to make allotment of sites in favour of all those who come forward to buy sites by enrolling them as bogus or associate members. They submitted while the heavy amounts paid to agents would be included in fixing the price of the sites, heavy amounts over and above the allotment rates will also be collected clandestinely which the purchasers of sites would be too eager to pay in that manner in view of the sky rocketing price for sites in the city and such amount would be appropriated by the office bearers of the society and the agents. They also submitted that the agents who got heavy amounts as their commission were required to influence the government and procure the preliminary and the final notifications from the government under the act in which they were successful. The learned counsel for the petitioners have also stated that the procedure for referring the proposal to acquire, to the three-men committee and issuing Section 4 (1) notification after clearance was given by the 3 men-committee were all stage-managed by the government as the agents had influenced to acquire the land and therefore it was not interested to find out the genuineness of the scheme proposed by each of the societies and this was evident from the fact that the threemen committee did not try to ascertain true facts relating to each of the societies referred to above but mechanically recommended to acquire the lands in favour of innumerable societies including the respondent-societies as it has now revealed in the reports of inquiry instituted subsequently by the government itself. The learned counsel, therefore, submitted that the impugned notifications were vitiated by legal mala fides and was a clear case of colourable exercise of power and therefore in public interest and purity of administration the notification should be set aside. ( 24 ) A detailed investigation by us in respect of the serious allegations made by the petitioners, have become unnecessary for the reason that the petitioners brought to our notice that during the pendency of these petitions, not only the acquisition of lands in favour of seven respondent-societies, but also acquisition of lands in favour of more than one hundred housing societies, all of which have sprung up within the Bangalore metropolitan planning area had become a matter of public debate and criticism, as a result of which a statutory enquiry was directed to be held by the registrar of co-operative societies under Section 64 of the Karnataka Co-Operative Societies Act by Sri G. V. K. Rao, the controller of weights and measures, and he had submitted his report. The petitioners submitted that the report fully establishes the allegations made by the petitioners. In the circumstance, at the request of the petitioners, by our order dated 3-8-1990, we directed the government Advocate to produce the copy of the said report. Accordingly, it has been produced. The petitioners submitted that the report fully establishes the allegations made by the petitioners. In the circumstance, at the request of the petitioners, by our order dated 3-8-1990, we directed the government Advocate to produce the copy of the said report. Accordingly, it has been produced. The relevant portion of the report generally in relation to activities of all the housing societies in the city, reads: "the additional registrar of co-operative societies (industrial and miscellaneous co-operatives), Bangalore vide order No. Hsg 105 hhs 87-88, dated 10th march, 1988, has appointed me under Section 64 of the Karnataka Co-Operative Societies Act, 1959, to enquire into certain allegations against 98 house building co-operative societies of Bangalore city. The main allegations referred to in the order are: 1) bogus agreements with the landlords are estate agents. 2) bogus membership and irregularities in registration of members. 3) irregularities in distribution of sites. 4) collection of exorbitant site advances from the members. Xxx xxx xxx in brief the irregularities committed by the societies are mainly in the nature of:1. Procedural irregularities in admission of members. 2. Admission of ineligible persons as members. 3. Admission of associate members without necessary Provisions in the byelaws. 4. To acquire the lands outside their jurisdiction. 5. To collect site deposits from associate members though the objective of the society is to form layout and distribute sites only to the members. 6. Entering into agreements with landlords and agents indiscriminately and in some cases unwarranted agreements. 7. Payment of exorbitant advances to the agents without proper securities; and 8. Collection of site deposits from the members without reference to the payments to be made to various agencies. however, the most predominant irregularity committed by many of the societies is the procedural irregularity in admission of members. In many cases the committees of management did not consider the applications for membership and there are no proper resolution specifying the persons who are admitted as members of the society, neither the applications nor the share ledgers disclose the date on which the committee admitted them as members. Therefore, in many of the cases it is just not possible to say who is admitted on what date by the committee of management. In fact, this type of procedural irregularities have been committed even by some of the long standing societies. Therefore, in many of the cases it is just not possible to say who is admitted on what date by the committee of management. In fact, this type of procedural irregularities have been committed even by some of the long standing societies. The next important irregularity committed by most of the societies is admission of persons who are not eligible to become the members. Most of these persons who are residing outside the jurisdiction of the society have been admitted as members. In almost all such cases the only response from the societies is that either they have an aim to amend the byelaws extending their jurisdiction or their proposed amendment has been rejected by the department on the ground that any extension of their jurisdiction would create overlapping jurisdiction with other societies. In the byelaws of most of the societies there is no provision for admission of associate members. Even in a few societies where they have made provision for admission of associate members, it was not provided in the byelaws that the allotment of sites to the associate members is one of the privileges enjoyed by such associate members. In the absence of any such specific mention about their privileges towards allotment of sites they are not eligible for allotment of any sites. This is further strengthened by the wordings of the objectives in the byelaws wherein it is specifically mentioned that the society is to form layouts and distribute sites for the benefit of the members. In fact none of these societies have any objectives for the benefit of associate members. Therefore, the associate members in any of the societies cannot claim any benefits from the society. However, many societies have admitted associate members and collected the site deposits from them. In fact in some of the societies like remco (bhel) house building co-operative society limited, the entire activities of the society have been directed towards the benefit of associate members and not towards the benefit of members. There are many societies who have been acquiring lands outside their jurisdiction and it is surprising how the government have cleared their proposals for acquiring (he lands outside their jurisdiction. Xxx xxx xxx (emphasis supplied) the practice of engaging middlemen for acquiring the land appears to be the bane of the societies. There are many societies who have been acquiring lands outside their jurisdiction and it is surprising how the government have cleared their proposals for acquiring (he lands outside their jurisdiction. Xxx xxx xxx (emphasis supplied) the practice of engaging middlemen for acquiring the land appears to be the bane of the societies. Most of them have made it a point to first enter into agreements with agents without even verifying their anticidents and invariably none of these agreements arc registered. Without any bank guarantee or any other securities the societies have advanced huge amounts to these agents. Some of these agents have turned out to be totally unscrupulous and they have landed these societies with overlapping claims on the lands to be acquired. In these cases the complicity and the involvement of the committee of management or the offtce bearers of the society cannot be overruled, since atleast in a few cases the office bearers have gone out of the way to pay more and more advances to such unscrupulous agents even after realising that these agents have landed up these societies into the problem of overlapping claims. This clearly brings out one aspect that the agreements entered into by the societies with the agents are not entirely for bona fide purposes. Xxx xxx xxx when the proposal of the society to acquire land is to be considered by the government and land into be acquired by the government for the benefit of the society, there appears to be absolutely no need of any agent for acquiring land, once the land is identified by the society. (emphasis supplied) xxx xxx xxx hence in all such cases, the agreements with the agents are to be treated as bogus and illegal and they are not in the interest of the societies. The office bearers of the society and the entire committee of management of the society also have vested interest in entering into such unwarranted agreements. Xxx xxx xxx general remarks going by the nature of irregularities committed by the societies they can be grouped into the following categories, namely 1. The societies who have not committed any serious irregularities. 2. The societies who have mainly indulged in admission of ineligible/bogus members. 3. The societies who have indulged in serious irregularities. The societies which have indulged in serious and grave irregularities are: xxx xxx xxx 9. The societies who have not committed any serious irregularities. 2. The societies who have mainly indulged in admission of ineligible/bogus members. 3. The societies who have indulged in serious irregularities. The societies which have indulged in serious and grave irregularities are: xxx xxx xxx 9. Remco (bhel) house building co-operative society limited. Xxx xxx xxx 24. Bank officers and officials house building co-operative society limited. Xxx xxx xxx 26. H. m. t. employees' house building co-operative society limited. Xxx xxx xxx 37. The Bangalore chickpet house building co-operative society limited. Xxx xxx xxx 45. . . . . . . . . . . . . . . . . . . . The societies which have mainly indulged in admission of ineligible persons as members are: xxx xxx xxx 6. Amarjyothi house building co-operative society limited. Xxx xxx xxx 15. . . . . . . . . . . . . . . . . . . . In the following societies there are no serious irregularities worth highlighting though in some of them there are some minor procedural irregularities. Xxx xxx xxx 19. Jayanagar co-operative housing society limited. Xxx xxx xxx the following societies have not submitted their records for verification. As such the activities of these societies could not be enquired into. Since the office bearers of these societies have failed in their mandatory requirement to submit the records, necessary action may be taken from the department for disciplining these societies. 2. The vyalikaval house building co-operative society limited. " ( 25 ) IN relation to each of the six respondents-societies, other than the v Yalikavalhouse building co-operative society which had failed to appear before the enquiry officer, the relevant part of the report reads:"remco (bhel) house building co-operative society limited, Bangalore. This society which was registered in the year 1969 had jurisdiction over Bangalore city corporation limits and B. D. A. limits and only the employees of remco (bhel) are eligible to become members of the society. However, by an amendment dated 20-7-1979, it was provided to have associate members for those who are not employees of bhel. Except for disqualification of these associate members from contesting, participating in voting and holding any elected posts in the society, there are no other privileges or liabilities specified in the byelaws. However, by an amendment dated 20-7-1979, it was provided to have associate members for those who are not employees of bhel. Except for disqualification of these associate members from contesting, participating in voting and holding any elected posts in the society, there are no other privileges or liabilities specified in the byelaws. If that is so there is no question of these associate members being eligible for getting sites or loans or any other benefits from the society. (emphasis supplied) xxx xxx xxx there are many persons who are not employees of bhel and are admitted as associate members and the site deposits have also been collected from these associate members though they are not eligible for getting sites from the society, since one of the objectives of the society was to form layout and house sites for the benefit of the members only and not for associate members. The committee did not pass any resolution for admitting about 100 members in March 1984 though in the share ledgers these 100 members names have been entered. Secondly all these applications were also more than three months old and they are deemed to have been rejected. At this stage the committee had no jurisdiction even to consider their admission. As such the admission of members from si. No. 808 to 905 is illegal and irregular. Xxx xxx xxx the society has collected about Rs. 37. 5 lakhs as site deposits from the associate members who are not employees of remco (bhel), since these persons are not eligible for getting the sites from the society, collection of huge site deposits from the associate members is highly irregular and illegal. The society entered into agreement with M/s. Raghavendra enterprises for acquiring about 31 acres and 13giintas of land situated in kenchenahally village at a cost of Rs. 95 per sq. Yard of sital area for residential sites and Rs. 125/- per sq. Yard of sital area for corner sites. The society had also entered into agreement with the same agent for acquiring the land situated in pattanagere village and in pursuance of these agreements the society had paid about Rs. 64 lakhs to the agent, Rs. 19 lakhs was deposited with the land acquisition officer. The land acquisition proceedings in respect of both these layouts are reported to be in the award stage. 64 lakhs to the agent, Rs. 19 lakhs was deposited with the land acquisition officer. The land acquisition proceedings in respect of both these layouts are reported to be in the award stage. However, one striking feature of this agreement is that allpayments are to made in cash. This condition is not sound and proper on the part of the society and this gives scope for doubting the intention of the persons involved. Xxx xxx xxx as it stands today the society is no longer running its activities for the exclusive benefit of members and the emphasis has shifted to the benefit of the associate members who are not entitled to get any sites from the society. The committee is solely responsible for indulging in this type of illegal activities of allotment of sites to the ineligible persons and for taking up the activities which are not in accordance with the objectives of the society. They should immediately refund all the site deposits collected from the associate members and concentrate their activities only as per the objectives of (he society i. e. , for the benefit of the members and not for associate members. "the amarjyolhi house building co-operative society limited, Bangalore. This society which was registered in the year 1970 has its area of operation confined to Bangalore city corporation limits except the places coming under the cantonment area. Persons ordinarily residing within the jurisdiction of the society are eligible to become members of the society. It is also provided in the byelaws for admission of associate members who desire to have sites only or raise loans through the society from various financial institutions and byelaw also provides for admission of nominal members who transact any business with the society. The society admitted large number of members who are already members of other house building co-operative societies or they are residing outside the jurisdiction of the society or (hey have not even furnished their address in the application or they have not submitted the applications etc. These are all serious irregularities committed by the committee of management. Initially, the society admitted large number of associate members and all of them were transferred as regular members. No specific procedure was followed except for above resolution in the committee of management. These are all serious irregularities committed by the committee of management. Initially, the society admitted large number of associate members and all of them were transferred as regular members. No specific procedure was followed except for above resolution in the committee of management. Since most of the irregularities were committed in regard to the membership of the persons who are so transferred this type of registration of members and especially these 1700 members is of doubtful nature. Further, the committee also went ahead with admission of new members within 30 days before the general body meeting and this is also in violation of the byelaws and the act. Even the resolutions of the committee do not indicate who are the persons admitted as members, it merely states 2038 applicants enroll as members and in some other occasions it says new members are enrolled without even giving the number of such members. In the process it is not possible to know who are the persons admitted as members in these resolutions and wide scope is provided to play any mischief for enrolling the bogus members. On the whole the committee has committed serious irregularities regarding the admission of new members and not less than 4050 members are not eligible to be enrolled as members. Tlie society collected site deposits from about 770 members amounting to about Rs. 9. 7 crores. Society collects the site deposits in different instalments based on the site value estimated as per the agreemenls entered into with the agents. The society entered into agreement with M/s. Vellalu enterprises in the year 1980 for acquiring about 82 acres of land situated at dotmmalurand surrounding villages at Rs. 120/- per square yard of sital area. The acquisition was completed for about 46 acres and the formation of layout is in progress. Since the amounts payable to B. D. A. itself are coming upto Rs. 172/- per square yard of sital area, the amount payable to the agent also will have to be revised. The society entered into another agreement with the same agent in the year 1982 for acquiring further 200 acres of land situated at challabhatla at Rs. 140/- per square yard of sital area including the completion of civil works etc. Land acquisition proceedings are in progress for 146 acres. The society entered into another agreement with the same agent in the year 1982 for acquiring further 200 acres of land situated at challabhatla at Rs. 140/- per square yard of sital area including the completion of civil works etc. Land acquisition proceedings are in progress for 146 acres. The society again entered into agreement with the same agent in the year 1982 for acquiring another 160 acres situated atarohally village at Rs. 105 per sq. Yard of sital area. In this case also the acquisition proceedings in respect of 128 acres is in progress, they have also entered into agreement with M/s. Raghavendra enterprises for acquiring 350 acres of land at Rs. 1201-per sq. Yard of sital area. This amount is exclusively towards the land cost. The acquisition proceedings in respect of 277 acres are in progress. The society has so far paid an advance of Rs. 1. 3 crores in respect of the first agreement, Rs. 1. 08 crores for the second agreement and Rs. 1. 56 crores for the third agreement and Rs. 5. 2 crores towards the fourth agreement. These amounts included the payments made to landlords, agents, lao and the development charges in respect of first agreement. As per the explanation of the hon. Secretary of the society they have paid full consideration to the landlords in most of the cases and obtained power of attorney and to this effect the landlords also appeared before the lao and stated that they have received full consideration. Conclusions: since there are serious irregularities regarding the admission of members and that they have admitted persons who are not eligible to be admitted as members and they have also admitted the members without any proper proceedings in the committee about their admission, all these admissions are to be treated as bogus admission and (his amounts to about 4050 such bogus admission and as such they are to be removed from the rolls of the society. If this is done the society will not require so much land to be acquired and the site deposits collected from such ineligible and bogus' members should be returned to the members. Tlie committee of management is solely responsible for this type of illegal activities and they cannot be expected to run the affairs of the society in proper manner. (emphasis supplied) hmt employees co-operative housing society limited, Bangalore. Tlie committee of management is solely responsible for this type of illegal activities and they cannot be expected to run the affairs of the society in proper manner. (emphasis supplied) hmt employees co-operative housing society limited, Bangalore. This society'which was registered in the year 1959 has its jurisdiction extending to the Bangalore city corporation limits and the Bangalore north taluk. The membership is open to any person above 18 years of age. However, preference will be given for the employees of hmt over all others. Considering the name of the society the provision regarding the membership is vague and leaves large scope for admitting non-employees as members. The scrutiny of the applications indicate that there are many persons who are neither employees nor residents of the jurisdiction of the society who are admitting as members of the society. Though there is no provision in the byclaw for collecting share amount in monthly instalments, the society has in general collected while admitting the applicants as members. This is a gross irregularity committed by the committee of management. The share ledgers are incomplete and most of the details are not available in the share ledgers, date of admission of the members, their names and address of the nominee etc. , Have not been property filled in and in most of the cases members signature has not been obtained in the share ledgers. Though it is binding for the members to purchase minimum of five shares many members have purchased only one share and they have been admitted by the committee of management as members. This is a serious irregularity committed by the committee. The society collected the site deposits ranging from Rs. 10,000/- to Rs. 26,000/- in different instalments depending on the progress of the work. The site deposits have been collected on the name of different layouts and for jakkur. Layout rs, 20,91,642a from 284 members, for kudlu layout Rs. 38,87,000 from 522 members, for nagasandra layout Rs. 4. 75 crores from 1892 members. For corner sites the society has also collected about Rs. 100 over and above the general rales of the other sites. The total site deposits collected by the society amounting to about Rs. 5. 33 crores. The society has entered into agreement with four estate agents (1) s. r. constructions for thindlu and chikkabettahally layouts for acquiring 213 acres and paid a total advance of Rs. 100 over and above the general rales of the other sites. The total site deposits collected by the society amounting to about Rs. 5. 33 crores. The society has entered into agreement with four estate agents (1) s. r. constructions for thindlu and chikkabettahally layouts for acquiring 213 acres and paid a total advance of Rs. 92,52,938/- to the agent and Rs. 35 lakhs to special land acquisition officer. The land acquisition proceedings are not yet initiated. Considering this the exorbitant amount advanced to the agent is risky and the society has not taken sufficient care before advancing about Rs. 92 lakhs to the agent without much progress. (2) Sri Lakshminarasimha Enterprises for nagasandra and nallakadirenahally layouts acquiring 130 acres of land and the acquisition proceedings are completed. For this layout Rs. 2. 33 crores is already paid to the agent and Rs. 87 lakhs to the special land acquisition officer (3) nath and nath associate for jakkur layout for acquiring about 88 acres of land and paid Rs. 30 lakhs as advance to the agent. In this case no progress has been made regarding land acquisition. Similarly, in the case of agreement with M/s. Matha enterprises for acquiring about 10 acres of land, did not make any progress though the society has advanced Rs. 45 lakhs to the agent. The amount advanced to the agents are unreasonably high especially when the land acquisition proceedings are not been initiated in most of the cases. They have paid over Rs. 4 crores as advances to them the society has obtained bank guarantee only from 15 to 40 lakhs from each of the agent, i. e. , totally about Rs. 70 lakhs and these bank guarantees are to be discharged on publication of Section 4 (1) notification except in one case of 130 acres, in all the cases land acquisition proceedings are not initiated and about 1. 6 crores advanced to these agents cannot be justified by any stretch of imagination. (emphasis supplied) conclusions: the society has admitted large number of persons who are neither employees of hmt nor residents of the jurisdiction of the society. All of them are to be removed from the rolls of the society. 6 crores advanced to these agents cannot be justified by any stretch of imagination. (emphasis supplied) conclusions: the society has admitted large number of persons who are neither employees of hmt nor residents of the jurisdiction of the society. All of them are to be removed from the rolls of the society. The society grants the membership without collecting the sufficient share amount and in many cases only the single share was taken by the members, whereas it was necessary for members to take alleast five shares. The committee solely responsible for these irregularities. Secondly the society made huge advances to the agents without commensurate amount of guarantee or security and without any work being done by the agents. There is atleast Rs. 1. 6 crores which has been advanced to the agents without any work. The committee in general and the hon. Secretary of the society in particular is responsible for these irregularities. " Bank officers and officials house building co-operative society limited, Bangalore. This society which was registered in the year 1981 has its area of operation extending to S. No. 21 of yelachenahaily village and other villages except B. D. A. notified areas of uttarahally hobli and madiwala village of begur hobli, katriguppa and kadirenahally house building co-operative societies area. Any bank officers or employees or employees of any other organisations desiring to settle in Bangalore are eligible to become members of the society. This is a very vague provision in the byelaw wherein under the clause that "any employee of any organisation", the society can admit the persons working in private establishments and thereby it loses its specific identification as bank officers and officials society. Secondly residing in the jurisdiction has not been made a criteria and instead, willingness to reside in the jurisdiction is made as a criteria, by which action the persons from anywhere in the world can become members. Xxx xxx xxx though taking advantage of the vague Provisions in the byelaws, that any person who is an employee and desiring to reside in the jurisdiction of the society after retirement can be admitted as member, the society has admitted persons working in different parts of the country as members of the society, they have not obtained any information as to the willingness of the applicant regarding their desire to settle within the jurisdiction of the society after their retirement. Since this is also one of the important conditions in the byelaws admitting the applicants as members, without ascertaining about their desire is not proper. The society has also admitted some members where the applications are not even signed by the applicants and in some other cases with incomplete applications. All these facts go to prove that the committee did not consider individual applications white admitting the members. They have failed in their duty to properly scrutinise the applications before admitting the new members. The society also had adopted illegal procedure for admission of members. They collect the admission fee, share fee and share amount etc. Even before issuing the blank application forms to the intending applicants and the receipt is passed for the amounts collected, the list of such persons is placed before the committee and the decisions are taken to admit them. All this is done, in most of the cases, even before receipt of the formal applications from the intending members. This is a serious irregularity and this has resulted in admission of ineligible members. Though the president says that they have admitted persons only who are desirous of acquiring the sites through the society, it is not clear why and how the husband and wife can become members of the society if the objective is to get site through the society. The society collected the site deposits ranging from Rs. 12,500/- and Rs. 45,000/- for the sites measuring from 30'x 40' to 50'x 80', all these amounts are expected to meet the land cost. The society entered into an agreement with M/s. Shanthi real estate agent for acquiring 30 acres of land in madivala village and they have acquired about 20 acres of land at the rate of Rs. 180/- per sq. Yard of sital area including the development of the layout. (emphasis supplied) they have also entered into an agreement with M/s. Divya enterprises for acquiring 75 acres of land at the rate of Rs. 112/- per sq. Yard of sital area at doddakallasandra village and the acquisition proceedings are yet to be initiated. Further, society also entered into agreement with M/s. Vellalu enterprises for acquiring another 270 acres of land in doddakallasandra at the rate of Rs. 107 per sq. Yard of sital area. 112/- per sq. Yard of sital area at doddakallasandra village and the acquisition proceedings are yet to be initiated. Further, society also entered into agreement with M/s. Vellalu enterprises for acquiring another 270 acres of land in doddakallasandra at the rate of Rs. 107 per sq. Yard of sital area. In this case, the acquisition proceedings are in progress in respect of 92 acres and for about 174 more acres, the government directions are reported to have been issued to the deputy commissioner for initiating the acquisition proceedings. The society had advanced about Rs. 15 lakhs to M/s. Divya enterprises since 1986 though no progress has been made regarding acquisition of the land. Similarly, the society has so far made payments to M/s. Vellalu enterprises, since 1985 upto the tune of Rs. 1. 1 crores and the progress in this regard is not commensurate with the payments made, since even after three years acquisition proceedings only in respect of 92 acres of land are initiated and the Section 6 (1) notification is yet to be issued. Conclusions: the committee of management has failed to scrutinise the applications before admitting the new members and as a result they have admitted the members without ascertaining the applicants desire to settle within the jurisdiction of the society after their retirement. This being an important condition of the byelaw, admitting the members without ascertaining this condition is irregular, because of the complacence on the part of the committee members it is possible mainly the speculators might have become members of the society. The fact that the society has blatantly admitted husband and wife for the purpose of acquiring site through the society, strengthens this inference that the society is operating mainly as an agency for acquiring the sites to the speculators and not for those who desire to settle in that area after their retirement. The society after having entered into agreement with M/s. Divya enterprises to acquire the land have done precious little to follow it up and to see that the land is acquired and instead they went on paying advances to the tune of Rs. 15 lakhs ot the agent without getting any work done. Similarly, the society has also paid huge amounts as advance to M/s. Vellalu enterprises, exceeding Rs. 1 crore without any guarantee and security, though the work is not progressing commensurate with the payments made. 15 lakhs ot the agent without getting any work done. Similarly, the society has also paid huge amounts as advance to M/s. Vellalu enterprises, exceeding Rs. 1 crore without any guarantee and security, though the work is not progressing commensurate with the payments made. The complacency shown by the committee of management in these dealings establishes that the committee is not functioning in the overall interests of the members of the society and the finances of the committee have not been handled prudently and the interests of the members are jeopardized. " (emphasis supplied) the Bangalore chickpct house building co-operalive society limited, Bangalore. This society which was registered in the year 1918 has the jurisdiction extending lo the whole of the corporation limits of the city of Bangalore including area over which B. D. A. exercised jurisdiction, excluding the satellite towns. All persons above the age of 18 years who are either residing within the city of Bangalore or who own immoveable property within the city of Bangalore are eligible for the membership. The society has a total membership of 5203. Society has admitted large number of associate members though there is no provision in their byclaws for admitting the associate members. Though the previous hon. Secretary of the society tried to justify these admissions on the ground that there was much demand for the membership of the society and for allotment of sites lo accommodate all of them they had admitted them as associate members, in fact this reasoning has no basis since as per the objectives of the society the acquisition of building sites and houses by the society is for the benefit of its members and not for associate members, similarly all other objectives include the clause that it is for the benefit of its members and not for associate members, as such by admitting more persons as associate members of the society cannot extend any benefits to these associate members. Therefore, the actions of the society in admitting large number of persons as associate members is blatantly illegal and without any basis. This has been done solely as a devise to accept deposits in the sociely. In facl even after increasing the authorised share capital to 15000 shares of 100 each, the sociely had admitted the associate members even the vague juslification offered by the ex. This has been done solely as a devise to accept deposits in the sociely. In facl even after increasing the authorised share capital to 15000 shares of 100 each, the sociely had admitted the associate members even the vague juslification offered by the ex. Secretary of the society also is not available for the recent admission of the associate members, xxx xxx xxx the society entered into an agreement with the agent Sri S. Ramachandran, Engineer, consultant and contractor for acquiring the land and getting the layout plan approved by B. D. A. at a cost of Rs. 115/- per sq. Yard of sital area. It is reported that the acquisition proceeding in respect of about 56 acres are in progress and the society has so far paid about Rs. 85. 71 lakhs to the agent towards this acquisilion. This is in excess of the amounts payable to the agent with reference to the stage of acquisition and as per the terras of agreement. The ex. Secretary of the society tries to justify this excess payments on the ground that because of the inordinate delay caused by the government in acquiring these lands, it has become inevitable to pay more to the agent. Conclusions: main irregularities committed in the society are regarding the admission of associate members without any Provisions to that effect and collecting site deposits from such associate members though they are not eligible for getting any sites from the society and payment of excess amounts to the agent towards land acquisition etc. The committee of management in general is responsible for these irregularities. (emphasis supplied) jayanagar co-operative housing society limited, Bangalore. This society which was registered in the year 1951 has admitted large number of persons residing outside Bangalore as members. The version of the hon. Secretary of the society that since there was provision in the byelaws to admit any Indian citizens as members of the society, they have done so, is not acceptable, since the jurisdiction of the society is restricted to Bangalore city only. When the two Provisions regarding jurisdiction and membership are read together only the Indian citizens residing within the jurisdiction will be eligible for the membership of the society. When the two Provisions regarding jurisdiction and membership are read together only the Indian citizens residing within the jurisdiction will be eligible for the membership of the society. More than 1000 applications were received in the society on a particular day i. e. on 30-7-1984 giving scope for doubting the circumstances under which this type of massive influx was there to the society. Out of these woo applications atleast 30 members did not even sign the applications even then (hey have been admitted as members of the society. This clearly shows that the committee did not consider the individual applications while admitting them as members. Therefore, the membership granted to all these persons is not proper. The society has collected the site deposits from the members amounting to Rs. 2. 95 crores at a uniform rate of Rs. 5. 000/- to Rs. 11,000/- irrespective of the dimensions of the sites. There are about 4000 members who are deposited the site deposits and the society did not enter into agreement with any landlords or any agents and they are acquiring about 128 acres of land. Conclusions: about 100 ineligible persons i. e. , those residing outside Bangalore admitted as members and about 30 members whose applications are incomplete cannot be considered as members and their membership has to be cancelled. Except this there seem to be no major irregularities in the society. (emphasis supplied) the learned counsel for the petitioners submitted that the findings recorded by the above enquiry officer fully establishes the allegations made by them to the effect that the respondent-societies were indulging in real estate business and the acquisition is not really for carrying out a housing scheme for the benefit of the members. 25. As far as the vyalikaval co-operative society is concerned, in view of its non-appearance before Sri G. V. K. Rao, the enquiry officer, a separate enquiry was ordered by, appointing the joint registrar of co-operative societies to enquire into the matter. The report in respect of the said society reads: "the registrar of co-operative societies has ordered an inquiry into the affairs of the vyalikaval house building co-operative society limited, 11th cross, malleswaram, Bangalore, vide order No. Hsw. 105. Hhs. 1987-88, dated 21-6-1989 and appointed the deputy registrar of co-operative societies (inquiry and inspection cell) as the enquiry officer. Xxx xxx xxx 4. 105. Hhs. 1987-88, dated 21-6-1989 and appointed the deputy registrar of co-operative societies (inquiry and inspection cell) as the enquiry officer. Xxx xxx xxx 4. The points for the inquiry enunciated in the order are: I. Irregularities in the enrolment of members. II. Bogus membership. III. False agreements with land owners and estate agents. IV. Collection of excess site deposits from Members. V. Irregularities in the distribution of sites. 5. 1 according to byclaw No. 2, the jurisdiction of the society extends to the whole of the corporation limits of the Bangalore city including the area covered by the Bangalore development authority. According to byelaw No. 13, any person above the age of 18 years residing in the jurisdiction of the society may be admitted as members. The number of persons residing outside the jurisdiction of the society including some residing outside Karnataka and outside India have been admitted as members contrary to the Provisions of the byelaws. Taking into consideration the residential addresses of the members furnished in the membership applications and membership registers, 116 persons reside outside the jurisdiction of the society, some of them are residing outside India also. Xxx xxx xxx. It is found that on 16-12-1985 the board has converted 9193 nominal members as associate members. When questioned about this, the president has stated that they were converted as associate members with the main intention of helping them to get sites as the three-men committee took a stand that the nominal members are not entitled for getting the sites, while so doing it appears, the question whether they have paid the required share amount to become the associate members was not verified. As many as 2632 persons have not paid the share amount and therefore they are not entitled to become associate members. The president has admitted that the nominal members were converted as associate members without their request and if such persons as have not paid the share amounts do not pay up the share amounts their membership would be cancelled. This means that wholesale conversion of nominal members as associate members even without collecting the required share amounts in many cases was done just to furnish information to the three-men committee so as to claim eligibility for grant of more lands. This means that wholesale conversion of nominal members as associate members even without collecting the required share amounts in many cases was done just to furnish information to the three-men committee so as to claim eligibility for grant of more lands. It is also found that 38 regular members and 1341 associate members have been admitted on 18-10-1987 and 15 regular members and 1164 associate members on 23-7-1987. According to the president of the society, the reason for such large scale admission is that a large number of persons came forward to become the members of the society during that period. It is difficult to accept this contention in the light of the fact that as many as 33 regular members and 414 associate members have been admitted on 21-6-19s7 and the board meetings have been held regularly. It is observed that 589 associate members who have been admitted earlier have been admitted again on 21-12-1986. The president and secretary have no proper explanation for this. 5. 3 a perusal of the membership and site applications shows the following irregularities: (a) in some cases persons other than the applicants have signed on behalf of the applicants. One Sri A. C. George has signed in as many as 29 cases on behalf of the applicants in both membership and site applications. For instance: Membership No. Name of the applicant Remarks 5605 H. P. Parimala Signed for her/him 5624 H. P, Sudhamani -do- 5626 K. B. Kaveramma -do- 470 Vedaprakash -do- 493 K. H. V. S. N. Murthy -do- (b) in some cases the membership and site applications are not at all signed by the members. For instance: 6059 G. S. Prahlad 1505 Smt. H. S. Bhagya 1345 Nalini Jagannathan 5290 R. Pandurangan (c) in some cases, minors have been admitted, for instance, a student of 14 years of age is enrolled as a member in roll No. 1363 and another student of 15 years vide roll No. 2026 has been admitted as member. (d) in respect of persons admitted as members vide roll Nos. 1837,1838, 1841,1842 and 1843, the age of the applicants is not mentioned. (e) in some cases, it is found that the dates of the applications have been changed. For instance, in respect of roll Nos. 1912, 1914, 1915 and 1917 the dates have been changed from 1-2-1983 to 29-1-1982. (d) in respect of persons admitted as members vide roll Nos. 1837,1838, 1841,1842 and 1843, the age of the applicants is not mentioned. (e) in some cases, it is found that the dates of the applications have been changed. For instance, in respect of roll Nos. 1912, 1914, 1915 and 1917 the dates have been changed from 1-2-1983 to 29-1-1982. In respect of roll No. 2179, the date has been changed from 4-12-1984 to 5-4-1982. (f) in some cases, there are no site and shares-applications: for instance roll No. 2001 (sri n. r. venkatesh lyengar), 2014, 2035,1995,1996,1997,1925 and 1926. (g) in some cases, there are only site applications but no share application. For instance roll Nos. 1912,1914, 1915,1917,1919 and 1920. (h) it is found that as many as 23 regular and 125 associate members have furnished on their applications, the same address bearing No. 7, 16th cross, malleswaram. It is learnt that the office of the society was located earlier at that address and the said address is the address of Sri N. K. Ramaswamy Iyengar who was the president of the society earlier and now one of the directors. (emphasis supplied) xxx xxx xxx as per the figures furnished by the secretary, there are 12317 members - 2485 regular members and 9832 associate members as on 30-6-1989. Of these 116 arc outside the jurisdiction of the society, 2632 cancelled in adding 379 cases where no share amount have been collected. 198 members residing at the same address, 194 admitted within 30 days prior to the general body meeting, 510 members belonging to 240 families, 162 cases who have been already been allotted sites, 95 cases where there are no membership' applications, about 200 cases where persons other than the applicants have signed the applications and 56 cases where the membership applications are not signed by anybody. Obviously the persons where there are no membership applications, where the membership applications are unsigned and where there are for signatures, are not eligible to become the members of the society. In respect of 5 cases, minors have been admitted as members and in respect of 46 cases, the members of kubera hbcs have been admitted as associate members of this society and these persons are not eligible to become the members of the society. In respect of 5 cases, minors have been admitted as members and in respect of 46 cases, the members of kubera hbcs have been admitted as associate members of this society and these persons are not eligible to become the members of the society. Thus the net eligible members would be 12317-3973 = 8344 taking into account that one person is eligible for getting site out of 198 members residing at the same address and one member per family, is eligible out of 510 members belonging to 240 families. However, the bogus membership, if any, can be found out only through individual-wise verification through summoning them for personal appearance or. Personal visits, opinion of the hand writing experts with regard to the genuineness of the signature etc. , Which has not been done for want of time. This needs further thorough verification. The next point for determination is about the genuineness of the agreements entered into by the society with the estate agents and the developers. The society has not entered into any agreement with the land owners directly. It is stated that the estate agents have entered into agreements with the land owners and the same are deposited with the L. A. O. inspite of the summons issued on 7-9-1989, the secretary was unable to produce the agreements with the land owners the g. p. a. taken from the land owners and the title deeds. The estate agent Sri K. Surya Rao and the developer Sri K. Vijaya Arya appeared on 14-9-1989 and confirmed the agreements they have entered into with the society. Sri K. Surya Rao said that Sri Nageshwar Rao and Sri Srinivas were his nephews and he was a common partner in both the companies viz. M/s. Nageshwar Rao and M/s. Srinivas and company which have entered into agreements with the society in respect of the property at kempapura agrahara. The other estate agents viz. , Sri Gajanana Enterprises, Sri A. S. Muniswamy Raju, Sri A. M. Chandrashekar Raju, 3rd Renuka Enterprises, Sri K. V. Narayan, construction company and Smt. Annapurnamma and the developers viz. , M/s. Vasavi Builders and L. R. Sheshadri Engineers and builders have not appeared for the enquiry. Xxx xxx xxx 23. To sum up, the following conclusions may be drawn: i. The society has enrolled 716 persons residing outside the jurisdiction at members of the society in violation of the byelaws. , M/s. Vasavi Builders and L. R. Sheshadri Engineers and builders have not appeared for the enquiry. Xxx xxx xxx 23. To sum up, the following conclusions may be drawn: i. The society has enrolled 716 persons residing outside the jurisdiction at members of the society in violation of the byelaws. There are many irregularities in the enrolment of members. Of the total number of 12317 members as on 30-6-1989, the net eligible members could be 8344. However, the bogus membership, if any, can be found out only through individual-wise verification through summoning them for personal appearance or personal visits, opinion of the hand-writing experts with regard to the genuineness of the signatures etc. , Which has not been done for want of time. This needs further thorough investigation. (paras 5. 1 to 5. 5) II. The agreements with the estate agents and developers cannot be said to be bogus. However, the agreements dated 4-6-1988 with Sri K. Surya Rao and that dated 6-6-1988 with Sri Srinivas Rao and Nageshwar Rao in respect of acquisition and development of 40 acres of land in karenahalli of kerapapura agrahara are ante-dated, (para 9. 9) iii. The society has made payments of advances to the agents and developers to the extent of Rs. 28,18, 38,750-65 as on 30-6-1989 without obtaining any security or guarantee and substantial payments are made in cash in violation of the Provisions under Negotiable Instruments Act. Payments in excess of the limits admissible to the agents as per the schedule of payment provided under the latest agreements have been to the agents as follows: Sri K. Surya Rao Sri P. P. R. V. Prasad Rao Gajanana Enterprises Renuka Enterprises, A. S. Muniswamy Raju Rs. 97,84,131-65 Rs. 79,71,295-00 Rs. 59,07,996-00 Rs. 37,85,253-34 Rs. 30,47,286-30 in respect of the marcnahally, k. p. agrahara layout, the total expenditure incurred a total expenditure of Rs. 1,34,72,806-65 as on 30-6-1989 no visible progress is there and the matters arc complicated. There is no justification for such excess payments. The secretary and the board are responsible for these payments. This needs thorough investigation. Iv. The society has violated principles of financial propriety like calling for tenders before entrusting the works to the agents and developers, taking security for the payments made, acting in the interest of the members, avoiding unnecessary expenditures etc. Xxx xxx xxx xii. The secretary and the board are responsible for these payments. This needs thorough investigation. Iv. The society has violated principles of financial propriety like calling for tenders before entrusting the works to the agents and developers, taking security for the payments made, acting in the interest of the members, avoiding unnecessary expenditures etc. Xxx xxx xxx xii. In respect of layouts at different places, the rates payable to the agents have been frequently revised without any justification. The procedure of payment of amounts to the estate agents and enhancement of rates is found to be not proper and reasonable for which uniform norms have to be fixed. Xiii. The society has paid brokerage/commission to persons other than either landowners orthe agents to the extent of Rs. 17,58,900/-for the obtensible work they did in securing vacation of premises/tenants or settlement with land owners, (vide para-11 ). Xxx xxx xxx xvi. Cash payments: huge payments have been made in cash to agents, owners, developers and others. (vide para-14 ). Xxx xxx xxx xxi. The secretary and the members of the concerned board are fully responsible for all the irregularities noticed during the inquiry and for recovery of the amounts wherever called for. The affairs of the society are conducted in a manner totally prejudicial to the interests of the members throwing to wind all canons of financial propriety and rules and procedures. (emphasis supplied) the learned counsel for the petitioner in W. P. No. 17775 of 1982 and connected cases in which the acquisition of land in favour of vyalikaval society, submitted that the allegations made by the petitioners in support of the sixth contention stand established by the inquiry report of the joint registrar. ( 26 ) FROM the report of Sri G. V. K. Rao, it is seen that the state government hadgiven approval for acquisition, for more than one hundred societies within the area of the Bangalore development authority. The learned government Advocate submitted that after the receipt of the above reports, a cabinet sub-committee has been constituted by the government to take a final decision in the matter and in view of the change of government, the cabinet sub-committee was reconstituted. He has produced a copy of the order dated 14-1-1991 by which the cabinet sub-committee has been reconstituted, which reads:"xxx xxx xxx I there is mushroom growth of house building co-operative societies in large cities like Bangalore. He has produced a copy of the order dated 14-1-1991 by which the cabinet sub-committee has been reconstituted, which reads:"xxx xxx xxx I there is mushroom growth of house building co-operative societies in large cities like Bangalore. In order to avoid such undue mushrooming and also to keep a check on the total extent of land to be allowed to be purchased by or allotted to them, a proposal was submitted to the cabinet for its approval. A cabinet sub-committee consisting of the following: xxx xxx xxx was constituted to go into the proposal and come up with the contours of a policy which will cover all the existing cases of house building co-operative society, as well as the action to be taken by all the authorities concerned in future. In view of the change of the government, it is necessary to re-constitute the cabinet sub-committee. Government order No. Hud 156 mnj 89, Bangalore, dated 14th january, 1991 the cabinet sub-committee on house building co-operative society is reconstituted with the following: xxx xxx xxx the housing and urban development department will service the cabinet sub-committee. "the learned government Advocate also submitted that the decision to issue final notifications was taken in view of the time bar for issuing them fixed in Section 6 of the Act, but at the same time the government had also taken a decision not to hand over possession of the lands acquired in favour of any of these societies and other societies, pending consideration of the matter by the cabinet sub-committee and the decision of the government in the light of the recommendation of the sub-committee. He submitted that possession of the lands acquired in favour of all the societies in the city had not been handed over so that the government will have the option to withdraw from the acquisition in exercise of its power under Section 48 of the act. He also submitted that an earlier order dated 30-3-1990 had also been passed by the registrar prohibiting all the societies within the city of Bangalore development authority limits from allotting any sites to any one, as certain societies were indulging in allotting sites even before possession of the acquired lands was handed over to them. He also submitted that an earlier order dated 30-3-1990 had also been passed by the registrar prohibiting all the societies within the city of Bangalore development authority limits from allotting any sites to any one, as certain societies were indulging in allotting sites even before possession of the acquired lands was handed over to them. ( 27 ) THE learned counsel for the respondent-societies, however, submitted that acquisition of lands impugned in these petitions was for carrying out housing schemes prepared by each of the societies and the findings recorded in the report of Sri G. V. K. Rao were not justified. They submitted that the state government had taken a decision to acquire lands in their favour after the same was recommended by the three-men committee constituted by the government. ( 28 ) NOW the final question for consideration is whether a notification issued by the state government under Section 6 (1) of the act notifying that certain lands are required for a public purpose is liable to be struck down on the ground that the exercise of power by the government was colourable, in that in truth it is not for the purpose for which the lands are stated to have been acquired. It is well settled position in law that though sub-section (3) of Section 6 of the act makes the declaration by the government that the land is needed for a public purpose, conclusive, if on the facts and circumstances of a given case it is established that there has been colourable exercise of power, the acquisition notification is liable to be struck down. The Supreme Court, as early, as in the case of Somavanti v State of Punjab, AIR 1963 SC 151 has stated thus:"36. Now whether in a particular case the purpose for which land is needed is a public purpose or not is for the state government to be satisfied about. If the purpose for which the land is being acquired by the state is within the legislative competence of the state the declaration of the government will be final subject, however, to one exception. That exception is that if there is a colourable exercise of power the declaration will be open to challenge at the instance of the aggrieved party. If the purpose for which the land is being acquired by the state is within the legislative competence of the state the declaration of the government will be final subject, however, to one exception. That exception is that if there is a colourable exercise of power the declaration will be open to challenge at the instance of the aggrieved party. The power committed to the government by the act is a limited power in the sense that it can be exercised only where there is a public purpose, leaving aside for a moment the purpose of a company. If it appears that what the government is satisfied about is not a public purpose but a private purpose or no purpose at all the action of the government would be colourable as not being relatable to the power conferred upon it by the act and its declaration will be a nullity. Subject to this exception the declaration of the government will be final. Xxx xxx xxx 40. Though we are of the opinion that the courts are not entitled to go behind the declaration of the government to the effect that a particular purpose for which the land is being acquired is a public purpose we must emphasise that the declaration of the government must be relatable to a public purpose as distinct from a purely private purpose. If the purpose for which the acquisition is being made is not relatable to public purpose then a question may well arise whether in making the declaration there has been, on the part of the government a fraud on the power conferred upon it by the act. In other words the question would then arise whether that declaration was merely a colourable exercise of the power conferred by the act and therefore the declaration is open to challenge at the instance of the party aggrieved. To such a declaration the protection of Section 6 (3) will not extend. For, the question whether a particular action was the result of a fraud or not is always justiciable, Provisions such as Section 6 (3) notwithstanding. "again the Supreme Court in the case of the collector, (district magistrate), Allahabad v Raja Ram Jaiswal, AIR 1985 SC 1622 , stated thus:"26. For, the question whether a particular action was the result of a fraud or not is always justiciable, Provisions such as Section 6 (3) notwithstanding. "again the Supreme Court in the case of the collector, (district magistrate), Allahabad v Raja Ram Jaiswal, AIR 1985 SC 1622 , stated thus:"26. Where power is conferred to achieve a purpose it has been repeatedly reiterated that the power must be exercised reasonably and in good faith to effectuate the purpose. And in this context 'in good faith' means for legitimate reasons'. Where power is exercised for extraneous or irrelevant considerations and reasons, it is unquestionably a colourable exercise of power or fraud on power and the exercise of power is vitiated. If the power to acquire land is to be exercised, if must be exercised bona fide for the statutory purpose and for none other. If it is exercised for an extraneous, irrelevant or non-germane consideration, the acaiur' ing authority can be charged with legal mala fides. In such a situation there is no question of any personal ill-will or motive. In municipal council of Sydney v Campbell, 1925 ac 338 at p. 375 it was observed that irrelevant considerations on which power to acquire land is exercised, would vitiate compulsory purchase orders or scheme depending on them. In State of Punjab v Gurdial singh, AIR 1989 SC 319, acquisition of land for constructing a grain market was challenged on the ground or legal mala fides. Upholding the challenge this court speaking through krishna iyer, /. , Explained the concept of legal mala fides in his hitherto inimitable language, diction and style and observed as under (at p. 321 of air): (emphasis supplied)"pithily put, bad faith which invalidates the exercise of power - sometimes called colourable exercise or fraud on power and often times overlaps motives, passions and satisfactions - is the attainment of ends beyond the sanctioned purposes of power by simulation or pretension of gaining a legitimate goal. If the use of the power is for the fulfilment of a legitimate object the actuation or catalysation by maliceis not legicidal. The action is bad where the true object is to reach an end different from the one for which the power is entrusted, goaded by extraneous considerations, good or bad, but irrelevant to the entrustment. If the use of the power is for the fulfilment of a legitimate object the actuation or catalysation by maliceis not legicidal. The action is bad where the true object is to reach an end different from the one for which the power is entrusted, goaded by extraneous considerations, good or bad, but irrelevant to the entrustment. When the custodian of power is influenced in its exercise by considerations outside those for promotion of which the power is vested the court calls it a colourable exercise and is undeceived by illusion. In a broad, blurred sense, benjamin disraeli was not off the mark even in law when he stated: "i repeat. . That all power is a trust - that we are accountable for its exercise - that, from the people and for the people, all springs and all mist exist. After analysing the factual matrix, it was concluded that the land was not needed for a mandi which was the ostensible purpose for which the land was sought to be acquired but in truth and reality, the mandi need was hijacked to reach the private designation of depriving an enemy of his land through back seat driving of the statutory engine. The notification was declared invalid on the ground that it suffers from legal mala fides. The case before us is much stronger, far more disturbing and unparalleled in influencing official decision by sheer weight of personal clout. The district magistrate was chagrined to swallow the bitter pill that he was forced to acquire land even though he was personally convinced there was no need but a pretence. Therefore, disagreeing with the high court, we are of the opinion that the power to acquire land was exercised for an extraneous and irrelevant purpose and it was colourable exercise of power, namely, to satisfy the chargin an anguish of the sammelan at the coming up of a cinema theatre in the vicinity of its campus, which it vowed to destroy. Therefore, the impugned notification has to be declared illegal and invalid from this additional ground. " (emphasis supplied) in view of the ratio of the aforesaid decisions, there can be no doubt that the final notification issued under Section 6 of the act is liable to be struck down if the court comes to the conclusion that the exercise of power was a colourable one. " (emphasis supplied) in view of the ratio of the aforesaid decisions, there can be no doubt that the final notification issued under Section 6 of the act is liable to be struck down if the court comes to the conclusion that the exercise of power was a colourable one. ( 29 ) IN the present case, the findings recorded in the report of g. v. k. Rao in respect of the five respondent-societies and the findings recorded in the report of the joint registrar in respect of vyalikaval co-operative society clearly establish that the acquisition of land in favour of each of the respondent-societies indicted in the reports, was not for bona fide housing scheme meant for distribution of sites only for bona fide members of each of those societies. The learned counsel for the petitioners submitted that the facts clearly establish that the predominant object and purpose was to acquire vast extent of lands under the guise that the lands were required for a housing scheme for its members and to carry on the business in the sale of sites and to make money as alleged by the petitioners, for which purpose they entered into agreements with builders and contractors. ( 30 ) NOW coming to the facts of these cases, the plea of the petitioners has been that the acquisition of land in favour of the respondent-societies was not for purposes of implementing the bonafide housing scheme meant for the benefit of members of co-operative society concerned which would constitute a public purpose as defined in Section 3 (f) (vi) of the Act, but they were actually indulging in real estate business and with that object in view, they had entered into agreements with real estate agents/builders/contractors and advanced huge sums of money to them and enrolled large number of persons who intended to purchase sites, as associate members of the societies irrespective of their eligibility and further large number of bogus members have been enrolled with the object of indulging in the sale of sites by allotting the sites in the names of such bogus members apparently for a reasonable price, but collect heavy amount clandestinely, which would be appropriated by the office bearers of the societies and the agents and heavy amounts paid under the agreements was also for the purpose of influencing the government to acquire the lands, in which job they were successful. ( 31 ) AS stated earlier, the state government itself after according sanction for acquisition of lands in favour of large number of societies, on receipt of complaints from the public, was satisfied that all was not well with the respondent-house building societies and large number of such societies which had sprung up within the Bangalore metropolitan area. This is evident from the fact that a detailed enquiry into the affairs of these societies was ordered by the registrar of co-operative societies by order dated 10-3-1988 in exercise of his power under Section 64 of the Karnataka Co-Operative Societies Act. Sri G. V. K. Rao, controller of weights and measures was appointed to hold enquiry into the affairs of as many as 98 house building co-operative societies. As seen earlier, after holding a detailed enquiry, the enquiry officer indicted as many as 60 societies. Out of them are the five respondent-societies. The only society among the respondent-societies which is not indicted in the report is the jayanagar co-operative society. The vyalikaval house building co-operative society did not appear before the said officer. Regarding the other co-operative societies, it is seen that the lands in favour of four societies was acquired earlier to the appointment of the enquiry officer under Section 64 of the act. The acquisition in favour of h. m. t. employees' co-operative society is subsequent to the report of the enquiry. Therefore, the case of that society had to be dealt with separately. ( 32 ) AS far as the four respondent-co-operative societies, namely, (1) the bank officers and officials house building co-operative society, (2) the remco (bhel) employees' house building co-operative society, (3) amarjyothi house building co-operative society, and (4) the Bangalore chickpet house building society, are concerned, the general findings as well as the findings recorded specifically in respect of these societies by the enquiry officer are extracted earlier. It is seen that these societies had indulged in enrolling large number of bogus members and associate members and had entered into agreements with the estate agents or builders and this discloses that in the guise of housing schemes for their members the office bearers of the societies and the agents with whom they entered into agreements with the object of making huge money by indulging in sale of sites and for that purpose had enrolled large number of members illegally and also enrolled bogus members. These findings have been based on the basis of the records, registers and information furnished by the societies. In particular regarding the agreement entered into by these societies with agents, with the object of getting the preliminary and final notifications issued by the government, the report stated thus:"the practice of engaging middlemen for acquiring the land appears to be the bane of the societies. Most of them have made it a point to first enter into agreements with agents without even verifying their anticidents and invariably none of these agreements are registered. Without any bank guarantee or any other securities the societies have advanced huge amounts to these agents. . . . . this clearly brings out one aspect that the agreements entered into by the societies with the agent are not entirely for bona fide purposes. . . Wlien the proposal of the society to acquire land is to be considered by the government and land is to be acquired by the government for the benefit of the society, there appears to be absolutely no need of any agent for acquiring land, once the land is identified by the society___hence, in all such cases, the agreements with the agents are to be treated as bogus and illegal and they are not in the interest of the societies. The office bearers of the society and the entire committee of management of the society also have vested interest in entering into such unwarranted agreements. " (emphasis supplied) in our opinion, the agreements entered into by the societies with agents and the huge amounts advanced to the agents in order to procure the preliminary and final notifications under the Land Acquisition Act from the government, are agreements opposed to public policy and totally expose the want of bona fides on the part of the housing scheme sponsored by the societies. It is not disputed by the learned counsel for the societies that such agreements have been entered into and heavy amounts have been advanced, though their contention is that in order to execute housing schemes assistance of such agents was considered necessary. We do not find any substance in the submission. It may be that for formation of layout, it is necessary to entrust it to a contractor. But the question of entrusting the work of formation of layout and of executing any allied construction work arises after the land is acquired. We do not find any substance in the submission. It may be that for formation of layout, it is necessary to entrust it to a contractor. But the question of entrusting the work of formation of layout and of executing any allied construction work arises after the land is acquired. But in all these cases, agreements have been entered into, under which one of the purposes of the agreement was that the agent should move the government to get the preliminary and the final notifications for acquisitions issued and it is for this purpose heavy amounts were agreed to be paid and paid to the agents concerned by each of the societies. As rightly pointed out in the report of g. v. k. rao, for a bona fide acquisition of land for a housing society, no middlemen was necessary and the engagement of their service was not for a bona fide purpose. The bringing into existence of middlemen and payment of heavy amounts under the agreement and entrusting the job of getting preliminary and final notifications issued from the government, in our opinion, was only for the reason that the agents were engaged to influence the government and procure the preliminary and the final notifications under the Land Acquisition Act, in which they were successful inspite of want of bona fides on the part of the societies concerned. This one circumstance, in our opinion, is sufficient to conclude that the whole scheme by the societies and the agents was mainly for purpose of making money by indulging in sale of sites as alleged by the petitioners. ( 33 ) AS far as vyalikaval society is concerned, as stated earlier, it failed to appear before g. v. k. rao, enquiry committee. However, subsequently, a separate enquiry was instituted and the joint registrar of co-operative societies was appointed to enquire into the matter. The report of the joint registrar is extracted earlier in which the society is severely indicted on various grounds. Sri M. R. Janardhana, the learned counsel appearing for the said society, streneously contended that the findings recorded by the joint registrar were not justified and that the acquisition was for carrying out a bona fide housing scheme prepared by the society. Sri M. R. Janardhana, the learned counsel appearing for the said society, streneously contended that the findings recorded by the joint registrar were not justified and that the acquisition was for carrying out a bona fide housing scheme prepared by the society. He also submitted that the advertisement said to have been issued by the society inviting applications from all persons desirous of purchasing sites and also specifying a person as an agent at dubai for the purpose, was not issued by the society. He, however, did not dispute that the agent who issued that advertisement was an agent with whom the society had entered into an agreement similar to those entered tnto by other societies. Further, the finding recorded regarding bogus membership in respect of this society and in particular that large number of members had given the address of the president of the society as their address and the finding to the effect that it had entered into an agreement with an agent and had advanced huge sums of money, are based on material evidence furnished by the society. All these facts leads to an irresistable inference that the society was indulging in the business of selling sites and to make money as alleged by the petitioner and it is for this purpose the office bearers of the society had entered into agreement with agents. ( 34 ) NOW coming to h. m. t. employees' co-operative society, the affairs of this society was also a subject-matter of enquiry by Sri G. V. K. Rao. He has indicted this society on various counts. The relevant portion of the report is extracted earlier. Apart from this, the petitioners have produced an agreement entered into by the society with s. r. construction company which show that huge sums of money were advanced to the agents and also agreed to pay huge sums of money to the agent for purposes of getting the preliminary and the final notifications issued under sections 4 and 6 of the act. The learned counsel for the respondent-societies submitted that the finding recorded in the report of g. v. k. Rao regarding bogus membership was not justified. The learned counsel for the respondent-societies submitted that the finding recorded in the report of g. v. k. Rao regarding bogus membership was not justified. He also submitted that a representation had been made by the society to the registrar of co-operative societies contesting the findings recorded against the said society and that a report had been sent by the registrar of co-operative societies to the government and it was only thereafter the government had taken a decision and the final notification was issued on 11-8-1989. ( 35 ) IT is seen from the writ petitions that the same were presented challenging the legality of the preliminary notification dated 12-7-1988. After issuing Rule nisi, dispossession of the lands was stayed by this court. Actually the final notification was issued during the pendency of the writ petitions on 11-8-1989 and thereafter the petitioners have made application for amendment of writ petition by adding an additional prayer for quashing the final notification dated 11-8-1989. The application was taken up for final hearing along with the writ petitions. We allow the amendment and proceed to consider the validity of the rival contentions. ( 36 ) THE original records of the secretariat concerning the acquisition of lands acquired under the notification dated 11-8-1989, have been produced, paragraphs 98 and 99 of the note read thus; 98. This is one of the hbcs listed by Sri G. V. K. Rao, which have committed grave irregularities and as per the decisions taken by the executive council, until a detailed enquiry into the irregularities is completed, the l. a. proceedings has to be kept in abeyance. 99. In this case, the Section 6 (1) notification has to be issued on or before 14-8-1989, otherwise the l. a. proceedings get vitiated. In view of the above, this file may be referred to co-operative department for its remarks/opinion regarding continuation of acquisition proceedings in this case. Submitted for orders," thereafter, it appears, a report was called for from the registrar of co-operative societies and he submitted his report to the secretary to government, department of co-operative societies. That report is not found in the file. Submitted for orders," thereafter, it appears, a report was called for from the registrar of co-operative societies and he submitted his report to the secretary to government, department of co-operative societies. That report is not found in the file. But an unofficial note put up by the secretary to government, co-operative department, is found in the file, it reads:"xxx xxx xxx dated; 9-8-1989 u. o. note sub: hmt employees' co-operative house building society Ltd. , Bangalore - report regarding the affairs of the society. Revenue department has indicated that the date of vitiation of land acquisition proceedings of the hmt employees' co-operative house building society Ltd. , Bangalore is 13-8-1989. The registrar of co-operative societies who was requested to further enquire into the irregularities noticed by Sri G. V. K. Rao during his enquiry, has now submitted his report. The following are the irregularities noticed by the investigation officer i. e. the assistant registrar of co-operative societies, Bangalore, 1st circle, as reported by the registrar of co-operative societies. 1. Bye-law No. 6 of the society prescribes that each member has to own a minimum of 5 shares. Bye-law No. 4 permits share amount to be recovered in 25 monthly instalments. If within the prescribed 25 instalments, the amount due for a minimum of 5 shares is not collected, such a member will not have the rights of a member. The number of such ineligible members remains to be verified, and has to be done before they are considered for allotment of sites. (emphasis supplied)2. The enquiry officer has reported that the obligation of collecting at least one share value in full from the members at the time of enrolment has not been kept to. A list of such ineligible members will also have to be obtained from the society before allotment of sites. (emphasis supplied)3. There are 65 cases of transfer of shares of deceased members to their nominees, without collection of share amounts afresh from them, which is in violation of Section 23 (2) (b) of the kcs act. The irregularities pointed out by Sri G. V. K. Rao that persons who are neither employees of hmt nor residing within the jurisdiction of the society have been admitted as members, has been found to be not correct, when examined as per the byclaws of the society. The byelaw No. 5. The irregularities pointed out by Sri G. V. K. Rao that persons who are neither employees of hmt nor residing within the jurisdiction of the society have been admitted as members, has been found to be not correct, when examined as per the byclaws of the society. The byelaw No. 5. 1 prescribes that for eligibility of membership a person has to be above 18 years, competent to contract and not a member of any housing society within the same area. Hmt employees are given, according to this byelaw, a preference over others. In actual practice it was noticed that membership has been limited to the employees of hmt units, and the schools and co-operatives run by hmt. Also residents within the jurisdiction as defined byelaw No. 1. 2, is not contemplated as a condition for eligibility for membership. Of a total of 7842 members on 31-5-1989, 2152 have already been allotted sites and 3129 members have paid sital deposits amounting to Rs. 4. 23 crores and are waiting for allotment of sites. It is reported by the enquiry officer that the society has entered into unregistered agreements with 4 agents and has advanced unreasonably high advances to them. The whole amount of sital deposits collected i. e. Rs. 4. 32 crores has been spent as advances to agents. A sum of Rs. 82. 16 lakhs borrowed from uco bank have also been utilised for this purpose. Even though the tmc has not cleared two additional projects at jakkur and shivanahalli villages and kudulu and singanasandra villages, Rs. 75 lakhs has been advanced to two agents for these projects, without obtaining bank guarantees covering the entire amount advanced. This is definitely not in the best interest of its members. (emphasis supplied)THE decision on land acquisition proceedings may be taken in the light of the above facts. Sd/- vatsala watsa, secretary to government, co-operation department. " (emphasis supplied) after the above note was put up, the notes put up at paragraphs 106 and 107 of the file reads:"106. The note given by secretary, co-operative at flag 'a' may please be seen. 107. Matters such as number of members eligible for sites etc. , Are to be decided by the co-operative department. We may, however, proceed with acquisition of land. For approval. The note given by secretary, co-operative at flag 'a' may please be seen. 107. Matters such as number of members eligible for sites etc. , Are to be decided by the co-operative department. We may, however, proceed with acquisition of land. For approval. "the above note was approved on 11-8-1989 and a final notification was issued in the official gazette on the very same date. As can be seen from the note, the registrar opined that the number of ineligible members admitted in violation of byelaw 6 requires to be verified. Therefore, it is clear that it was only an interim report. As regards the irregularity in admission of members other than the employees of h. m. t. units, the registrar was of the view that in view of the byelaw, there was no condition that a person becoming a member of the said society should be a resident within the jurisdiction of the society. However, from the last paragraph of the note, it is clear that the registrar had stated that the society had entered into agreements with four agents and had advanced unreasonably high amounts to them. It was also pointed out that there was no clearance in respect of jakkur and shivanahalli villages and the society had advanced Rs. 75 lakhs to two agents and this was not definitely in the best interest of the members. As can be seen from the decision of the government, the fact that the society had entered into agreements with agents for the purpose of acquisition of lands and had advanced huge sums of money to them, has not at all been considered. It is also on this ground the society was indicted to the effect that there was want of bona fides on the part of the society in seeking acquisition of lands. The registrar also agreed with this. The secretary to government, co-operation department, did not disagree with the said finding. The secretary did not recommend acquisition but only stated that decision has to be taken in the light of the facts stated. As stated earlier, it is seen that huge sums of money have been advanced by this society to its agents with the specific condition that it was for the purpose of getting sections 4 (1) and 6 (1) notifications issued. As stated earlier, it is seen that huge sums of money have been advanced by this society to its agents with the specific condition that it was for the purpose of getting sections 4 (1) and 6 (1) notifications issued. The learned counsel for the petitioners submitted that even as the registrar of co-operative societies was looking into the matter in depth, the notification acquiring land was issued without examining the bona fides of the scheme of the society. They submitted that as late as on 30-3-1990, the registrar of societies had passed an order prohibiting the respondents and all other societies within the Bangalore metropolitan area from allotting sites to any one, as some of the societies were indulging in allotment of sites even though the possession of the lands had not been taken over by the government and handed over to the societies in order to create a fait accompli. A copy of the order has been produced, which reads:"proceedings of the registrar of co-operative societies in Karnataka, Bangalore. Ref:1, enquiry ordered into the affairs of house building co-operative societies in No. Hsg/105/hhs/1987-88, dated 10-3-1988. ?2. Reports of the inquiry conducted by Shri g. V. k. rao. 3. Notification No. Rdc 211 clm 84, dated 24th october, 1984. 4. Do No. Cmw 30 chs 90, dated 28-3-1990 from the secretary to government, co-operation department. Preamble: whereas by his order dated 10-3-1988, the additional registrar of co-operative societies had appointed Shri g. v. k. Rao the then controller of weights and measures to inquire into the affairs of 98 house building co-operative societies in Bangalore. The interim report of Shri g. v. k. Rao was received on 13-5-1988 and the final report on 15-2-1989. He had been able to inquire into the affairs of 90 out of total of 98 house building co-operative societies referred to him. 2. Whereas, on 25-7-1989, a decision was taken by the government that in case of 60 societies where the inquiry report of Shri G. V. K. Rao indicated prima facie guilt and commission of various irregularities, detailed inquiries were to be conducted by the department of co-operation before taking any further action. Similarly, the 8 cases in which Sri G. V. K. Rao could not inquire into also had to be inquired into in detail by this office. 3. Similarly, the 8 cases in which Sri G. V. K. Rao could not inquire into also had to be inquired into in detail by this office. 3. Whereas, this office has been in accordance with the above decision conducting detailed inquiries into the affairs of such societies and sending reports to the government. So far reports in 41 cases have been sent to government including 5 interim reports. From the 36 cases of housing societies in which details reports have been sent, it is seen that a substantially large number of members in these societies have been found to be ineligible for being considered for allotment of house sites as per the byelaws of the society as well as the regulations of the B. D. A. and the circular instructions of the concerned departments. 4. Whereas, in 62 cases the inquiry is yet to be completed and final report sent to the government. As the individual inquiries now being conducted by the department are of a very detailed nature, they are necessarily time consuming. 5. Whereas, on the one hand it is felt that this department will require time to complete the remaining inquiries as well, on the other, it is apprehended that before completion of such inquiries the concerned societies may, if not prevented, continue with the allotment of sites and in certain cases allot them to members who may be later found to be ineligible. 6. Whereas, even in respect of other house building societies, which are not covered by the inquiries referred to above, similar inquiries have to be ordered to weed out the ineligible members. The allotment of sites to ineligible members will be per se objectionable and will also have the effect of adversely affectingthe rights of the legitimate and eligible members. 7. Whereas, both these issues have been considered by the government of Karnataka and it is felt that in order to ensure both i. e. prevention of allotment to ineligible members and protection of the rights of the eligible members, it will be necessary to issue uniform and detailed guidelines in this behalf. 8. 7. Whereas, both these issues have been considered by the government of Karnataka and it is felt that in order to ensure both i. e. prevention of allotment to ineligible members and protection of the rights of the eligible members, it will be necessary to issue uniform and detailed guidelines in this behalf. 8. Whereas, it is felt that to achieve the purpose of this exercise of laying down uniform guidelines for distribution of house sites by the societies to their members, it is necessary and desirable in public interest to prevent the housing co-operative societies from distributing sites until the declaration of the uniform guidelines. Hence the following order: order No. Hsc/105/hhs/1987-88 date: 30-3-1990 for the reasons stated in the preamble and being satisfied that it is necessary in public interest and in the interest of the members of the house building co-operative societies to issue direction for preventing the affairs of the house building co-operative societies in Bangalore city corporation and B. D. A. limits being conducted in a manner detrimental to the interest of the members thereof, i, vinay kumar, registrar of co-operative societies in Karnataka, Bangalore, under the powers under Section 30-b of the Karnataka Co-Operative Societies Act, 1959, vested in me under government notification No. Rdc 211 clm 84, dated 24th october, 1984, do hereby direct that all the house building co-operative societies situated or operating in Bangalore city corporation and B. D. A. limits, shall forthwith stop allotment of sites until further orders. these directions shall come into force with immediate effect. Given under my hand and seal this day the 30th march, 1990. Sd/~ vinay kumar, registrar of co-operative societies in Karnataka, Bangalore. "the above orders cover all the societies including the hmt employees' co-operative society. these directions shall come into force with immediate effect. Given under my hand and seal this day the 30th march, 1990. Sd/~ vinay kumar, registrar of co-operative societies in Karnataka, Bangalore. "the above orders cover all the societies including the hmt employees' co-operative society. ( 37 ) APART from that, as, stated earlier, the learned government Advocate submitted that in view of the serious irregularities committed by the societies and the serious allegations against the societies, in that, they are indulging in real estate business and the acquisition of land by the societies were not for purposes of implementing a bona fide housing scheme, a cabinet sub-committee had been constituted by order dated 14-1-1991 to go into the matter in depth and to advise the government as to the steps to be taken in the matter and that pending decision of the government, a decision has also been taken not to give possession of the lands acquired under the notifications impugned in these petitions and under several other notifications in favour of house building societies situated in the city of Bangalore. This decision of the government covers hmt employees' co-operative society also. Therefore, in our opinion, what we have said in respect of other five societies equally holds good to this society also, though the sanction for issuing final notification was given subsequent to the report of g. v. k. rao. This decision of the government covers hmt employees' co-operative society also. Therefore, in our opinion, what we have said in respect of other five societies equally holds good to this society also, though the sanction for issuing final notification was given subsequent to the report of g. v. k. rao. ( 38 ) AS regards the agreements entered into between the six respondent-societies and their agents, inter alia, for the purpose of influencing the government and to procure the preliminary and the final notifications under sections 4 and 6 of the Land Acquisition Act, which they did procure and which are the subject-matter of challenge in these petitions, the question which arises for consideration is, if the agreements are hit by Section 23 of the Contract Act on the ground that they were opposed to public policy, whether the impugned notifications are liable to be quashed on the ground that they were the result of exercise of influence by the agents on the government which submission of the petitioner stands substantiated by the approval given for acquisition in all such cases which has made the government itself to realise that it has totally bungled in the matter as is evident from the appointment of g. v. k. Rao committee and the joint registrar to enquire into the affairs of the vyalikaval society, the findings recorded by them and Constitution of cabinet sub-committee and also directions to the societies to stop allotment of sites. As far as the question that the agreements in question are opposed to public policy is concerned, it is seen that the real purpose of the agreement entered into between the respondent-societies and their agents was that the agent should get the preliminary and the final notifications from the government and for that purpose huge amounts were paid or agreed to be paid. Any power conferred on the government under a statute like the power conferred under sections 4 and 6 of the act has to be exercised bona fide and for the purpose for which the power is conferred. Therefore, an agreement under which a party to the agreement is required to influence the statutory authority'and to procure a decision favourable to the other party, is certainly opposed to public policy. Therefore, an agreement under which a party to the agreement is required to influence the statutory authority'and to procure a decision favourable to the other party, is certainly opposed to public policy. A detailed discussion of the point has become unnecessary in view of the authoritative pronouncement of the apex court of the country in its recent decision in Rattan chand Hira chand v Askar Nawaz Jung, 1991 (1) SVLR (c) p. 204: JT 1991 (1) SC 433. The case arose this way. The appellant therein had advanced a sum of Rs. 75,000-00 to the respondent under an agreement. The amount advanced was for the respondent prosecuting a case in which he claimed to secure his share to the properties left by nawab salar jung iii. The relevant conditions of the agreement were that after the successful prosecution of the case and securing his share the appellant was to be paid at the rate of one anna in a rupee out of the total amount of share secured and that the appellant should wield his influence with the central and state governments to have the respondent recognised as heir to the state. The respondent successfully established his claim to the share to the extent of Rs. 60 lakhs. Before he actually received, sajjad yar jung died. Thereafter, the appellant brought the suit for recovery of Rs. 3 lakhs, the agreed commission and for the return of Rs. 75,000/- in terms of the agreement, against the heirs of sajjad yar jung. The suit was dismissed on the ground that the agreement was in the nature of champerty deal and was also opposed to public policy and cannot be enforced. The high court dismissed the appeal. Before the Supreme Court, it was contended that alleast the appellant was entitled to a decree for Rs. 75,000/- advanced. The Supreme Court rejected the contention of the appellant and upheld the view taken by the high court. Relevant portion of the judgment reads:"sawant, j: 6. The city civil court where the suit was filed found that the agreement was genuine, that it was admissible in evidence, that the amounts were advanced by the plaintiff to the nawab and that the suit was not barred by limitation. Relevant portion of the judgment reads:"sawant, j: 6. The city civil court where the suit was filed found that the agreement was genuine, that it was admissible in evidence, that the amounts were advanced by the plaintiff to the nawab and that the suit was not barred by limitation. However, the court found that the agreement was opposed to public policy as the object of the agreement was that plaintiff should wield his influence with central and state ministers to have the nawab recognised as the heir to the estate in return for his being given one anna share in the amount to be received by the nawab. The court, therefore, held that the agreement in question was not enforceable. The court also held that even the amounts actually advanced by the plaintiff and received by the nawab could not be recovered by the plaintiff. Accordingly, the court dismissed the suit with costs. The plaintiff preferred an appeal to the high court. (emphasis supplied) 7. The division bench of the high court held that the appeal had abated against all the respondents on account of the failure of the plaintiff-appellant to bring on record the heirs of one of the respondents viz. , Askar nawab jung who had died pending the appeal. On merits, the bench also held that the agreement was against the public policy. The court further held that the agreement was one whole agreement and hence the plaintiff was not entitled to recover even the amount of Rs. 75,000/- which was actually advanced by him to the nawab for prosecuting the litigation. Tt is this decision which is challenged before us. Xxx xxx xxx 13. The high court referred to the evidence on record in appeal which had an intimate bearing on the nature and the purpose of the agreement in question and came to the following conclusions. The court held that the plaintiff-appellant was approached by the nawab because being a businessman of eminence, he was highly influential. He had an access to the ministers and other worthies in the government. He was in a position to secure to the nawab his claim by wielding his influence. The nawab knew about it and the plaintiff was also confident about it. It was immaterial that those whom he had approached were men of high repute and great integrity of character. He was in a position to secure to the nawab his claim by wielding his influence. The nawab knew about it and the plaintiff was also confident about it. It was immaterial that those whom he had approached were men of high repute and great integrity of character. The fact that because of his accessibility he could get things done through them or could make use of his other standing done with them to deliver goods to the nawab, was enough to taint the entire agreement with the vice of introducing corruption in public life. The high court also found that the advance which was made was in the nature of an investment to share the booty. There was no reason for the plaintiff who was a total stranger to the nawab to undertake the financing in question which was in those days on a considerably high scale. No person who was not confident of delivering the goods would have embarked on financing on such a liberal scale. The plaintiff admittedly was a businessman who knew the value of each pie he was spending. He was doing it was a fruitful investment with sure returns. That is evident from the terms of the contract themselves since both the advance and the consideration for which the advance were made form part of one integral contract. On these facts which are on record, the high court came to the conclusion that the parties had entered into the agreement in question with the avowed purpose that the plaintiff would use his then prevailing influence wilh the worthies in the government to secure the gains for the nawab. Hie court on this evidence came to the conclusion that the agreement was nothing but one obviously made to lend services as a "go-between" or a "carryer" for commission. This being so, it was against public interest and detrimental to the health of body politic. (emphasis supplied) xxx xxx xxx 15. 1 am in respectful agreement with the conclusion arrived at by the high court, it cannot be disputed that a contract which has a tendency to injure public interests or public welfare is one against public policy. What constitutes an injury to public interests or welfare would depend upon the contract is sought to be enforced would decide the factum, the nature and the degree of the injury. What constitutes an injury to public interests or welfare would depend upon the contract is sought to be enforced would decide the factum, the nature and the degree of the injury. It is contrary to the concept of public policy to contend that it is immutable, since it must vary wilh the varying needs of the society. What those needs are would depend upon the consensus value judgments of the enlightened Section of the society. These values may some limes get incorporated in the legislation but sometimes they may not. The legislature often fails to keep pace with the changing needs and values nor is it realistic to expect that it will have provided for all contingencies and eventualities. It is, therefore, not only necessary but obligatory on the courts to step in to fill the lacuna. When courts perform this function undoubtedly they legislate judicially. But that is a kind of legislation which stands implicitly delegated to them to further ihe object of the legislation and to promote the goals of the society. Or to put it negatively, to prevent the frustration of the legislation or perversion of the goals and values of the society. So longas the courts keep themselves tethered to the ethos of the society and do not travel off its course, so long as they attempt to furnish the felt necessities of the time and do not refurnish them, their role in this respect has to be welcomed. (emphasis supplied) it is true that as observed by burrough, J. In Richardson v Mellish, (1824)2 bing. 229 at 252, public policy is "an unruly horse and dangerous to ride" and as observed by cave, j. , In re minims (1891)3 qb 594 at 595, it is "a branch of the law, however, which certainly should not be extended as judges are more to be trusted as interpreters of the law than as expounders of what is called public policy". But as observed by prof. Winfield in his Article 'public policy in the english common law' (1928)42 harv. L. Rev. 76,91): "some judges appear to have thought it (the unruly horse of public policy) more like a tiger and refused to mount it at all, perhaps because they feared the fate of the young lady of riga. Others have regarded it like balaam's ass which would carry its rider nowhere. L. Rev. 76,91): "some judges appear to have thought it (the unruly horse of public policy) more like a tiger and refused to mount it at all, perhaps because they feared the fate of the young lady of riga. Others have regarded it like balaam's ass which would carry its rider nowhere. But, none, at any rate at the present day, has looked upon it as a pegasus that might soar beyond the monetary needs of the community. "all courts are at one time or the other felt the need to bridge the gap between what is and what is intended to be. The courts cannot be in such circumstances shirk from their duty and refuse to fill the gap. In performing this duty they do not foist upon the society their value judgments. They respect and accept the prevailing values, and do what is expected of them. The courts will, on the other hand, fail in their duty if they do not rise to the occasion but approve helplessly of an interpretation of a statute or a document or of an action of an individual wh'ch is certain to subvert the societal goals and endanger the public good. 16. The contract such as the present one which is found by the city civil court as well as the high court to have been entered into with the obvious purpose of influencing the authorities to procure a verdict in favour of the late nawab was obviously a "carryer" contract. To enforce such a contract although its tendencies to injure public real is manifest is not only to abdicate one's public duty but to assist in the promotion of a pernicious practice of procuring decisions by influencing authorities when they should abide by the law. To strike down such contracts is not to invest a new head of public policy but to give effect to its true implications. ,4 democratic society is founded on the Rule of law and any practice which seeks to subvert or circumvent the law strikes at its very root. When the court foundation discountenances such practice, it only safeguards the foundation of the society. Even assuming, therefore, that the court finds a new head of public to strike down such practice, its activism is not only warranted but desired. The appeal is, therefore, dismissed. When the court foundation discountenances such practice, it only safeguards the foundation of the society. Even assuming, therefore, that the court finds a new head of public to strike down such practice, its activism is not only warranted but desired. The appeal is, therefore, dismissed. In the circumstances of the case, there will be no order as to costs. Fathima Beevi, J. Xxx xxx xxx in the face of the concurrent findings with which we agree, I have no doubt in our mind that the contract relating to the payment of the amount is not severable from the agreement to promote the cause of sajjid yar jung by wielding the influence the plaintiff had. Every agreement of which the object or consideration is unlawful is void. The consideration or object of an agreement is unlawful when the court regards it as opposed to public policy. If anything is done against the public law or public policy that would be illegal inasmuch as the interest of the public would suffer in case of contract against public policy is permitted to stand. Public policy is a principle of judicial interpretation founded on the current needs of the community. The law relating to public policy cannot remain immutable. It must change with passage of lime. A bargain whereby one party is to assist another in recovering property and is to share in the proceeds of the action and such assistance. is by using the influence with the administration, irrespective of the fact that the persons intended to be influenced are not amenable to such influence is against protection and promotion of public welfare. It is opposed to public policy. In this view, we would hold that the plaintiff cannot enforce the agreement to recover the amount from the respondents. " (emphasis supplied) applying the ratio of the above judgment, there can be no doubt that the agreements entered into between the six respondent-societies and their respective agents in which one of the condition was payment of huge sums of money by the society to the agent in consideration of which the agent had to get the preliminary and final notifications issued by the government, was for the purpose of influencing the government and to secure approval for acquisition of the lands and therefore opposed to public policy. ( 39 ) THE question, however, for our consideration is, whether the impugned notifications are liable to be quashed. In our opinion, once it is clear that the agreement entered into between the societies and the agents concerned, under which the purport of one of the clauses was that the agent should influence the government and to procure preliminary and final notifications under sections 4 and 6 of the act respectively are opposed, to public policy, the impugned notifications being the product or fruits of such an agreement are injurious to public interest and detrimental to purity of administration and therefore cannot be allowed to stand. As seen from the findings of g. v. k. Rao inquiry report, in respect of five respondent societies and the report of the joint registrar in respect of vyalikaval house building co-operative society, these societies had indulged in enrolling large number of members illegally inclusive of ineligible members and had also indulged in enrolling large number of bogus members. The only inference that is possible from this is that the office bearers of the societies had entered into unholy alliance with the respective agents for the purpose of making money, as submitted for the petitioners. Otherwise, there is no reason as to why such an agreement should have been brought about by the office bearers of the society and the agents. Unless these persons had the intention of making huge profits as alleged by the petitioners, they would not have indulged in entering into such agreements and would not have indulged in enrolment of ineligible and bogus members. The circumstance that without considering all these relevant materials the government had accorded its approval, is sufficient to hold that the agents had prevailed upon the government to take a decision to acquire the lands without going into all those relevant facts. The circumstance that without considering all these relevant materials the government had accorded its approval, is sufficient to hold that the agents had prevailed upon the government to take a decision to acquire the lands without going into all those relevant facts. The irresistible inference flowing from the facts and circumstances of these cases is, whereas the power conferred under the Land Acquisition Act is for acquiring lands for carrying out housing scheme by a housing society, in each of the cases the acquisition of lands is not for a bona fide housing scheme but is substantially for the purpose of enabling the concerned office bearers of respondent-societies and their agents to indulge in sale of sites in the guise of allotment of sites to the members/associate members of the society and to make money as alleged by the petitioners and therefore it is a clear case of colourable exercise of power. Thus the decision of the government to acquire the lands suffers from legal mala fides and therefore the impugned notifications are liable to be struck down. ( 40 ) THE only exception among the respondent-societies, however, is that of jayanagar co-operative society. As can be seen from the findings recorded by Sri G. V. K. Rao, except a few minor irregularities, there are no serious irregularities established against this society. Therefore, whatever we have said earlier, applies to societies indicted in that report and the vyalikaval society indicted in the enquiry report of the joint registrar. However, in this case, there is an additional ground urged by the petitioners. Therefore, whatever we have said earlier, applies to societies indicted in that report and the vyalikaval society indicted in the enquiry report of the joint registrar. However, in this case, there is an additional ground urged by the petitioners. The petitioners state that after the preliminary notification was issued and enquiry under Section 5-a of the act commenced, a writ petition in W. P. No. 5491 of 1987 had been filed before this court on the ground that no inquiry was held before the issue of the preliminary notification and that the further proceedings in the enquiry were stayed by an interim order dated 15-4-1987, but subsequently on 16-6-1987 the writ petition came to be dismissed on the ground that not holding of an inquiry before the issue of Section 4 notification was not fatal but an inquiry as to whether government should give consent for acquisition could be held as part of Section 5-a enquiry and even so thereafter without giving notice to the parlies fixing the dale of hearing, the inquiring authority submitted a report to the government under Section 5-a of the act and on that basis the state government issued the final notification. ( 41 ) WE asked the learned government Advocate as to whether the above submission made by the learned counsel for the petilioners, was correct. He was not in a position to contradict the submission made by the petilioners. He produced the records. The order sheet of the inquiring authority disclosed that the enquiry proceedings were adjourned on 27-4-1987 in view of the stay order without fixing any date and that after the stay order was vacated the proceedings were continued on 26-8-1987. The records do not disclose that any notice was given to the petilioners to appear before the 1 nquiring authority on 26-8-1987 or any other date. Without doing so, the enquiry officer submitted the report. As the holding of enquiry under Section 5-a in accordance with the rules is mandatory, in view of the said provision and also the Provisions of the land acquisition rules, the final notification in respect of the jayanagar society in so far it relates to the lands of the petitioners, is liable to be set aside on this-ground. ( 42 ) THERE are some special grounds with reference to some of the respondent-societies. ( 42 ) THERE are some special grounds with reference to some of the respondent-societies. In the case of vyalikaval house building co-operative society, the petitioners have stated that the total area proposed to be acquired in the preliminary notification was 141 acres 36 guntas and out of that while issuing the final notification 18 acres 26 guntas were deleted and the actual area sought to be. acquired was 123 acres 11 guntas. The learned counsel for the petitioners pointed out that out of 123 acres 11 guntas, 71 acres and 11 gunlas forms park zone under the comprehensive development plan (the cdp for short), prepared and published under the Karnataka country and town planning act. The map also has been produced. The learned counsel for the respondent-societies and the government do not dispute that substantial portion of the land proposed to be acquired forms park area. The learned counsel invited our attenlion to the zoning regulations concerning park area. It reads:"1. 2. 8 parks and play grounds and recreational areas 1. 2. 8. 1 uses permissible under special circumstances: clubs, canteens, ; libraries, aquarium, planetarium, museum, horticultural nursery and swimming pool. "as can be seen from the above provision, within the park zone, construction of residential houses is not permitted. Without noticing the cdp in which such a large extent of land was earmarked as park area that its diversion to other purpose is not permitted, under the planning act the government proceeded to accord approval for the acquisition of the land for the housing scheme. In the 5-a report dated 4-7-1987 sent to the government, it was stated thus:"the director, town planning, Bangalore, in his letter No. 155/1986-87, dated 25-6-1986 has intimated that the opinion of the Bangalore development authority may be obtained as the B. D. A. is competent to furnish the opinion in the matter. A copy of the letter is enclosed for reference. Replies from other officers have not been received so far. "however, without consulting the Bangalore development authority, the planning authority for the city, the government accorded sanction for acquisition. The non-consideration of the fact that out of 123 acres 11 guntas proposed to be acquired, 71 acres and 11 guntas of land falls within the park area, is by itself sufficient to strike down the impugned notification. ( 43 ) IN writ petition Nos. The non-consideration of the fact that out of 123 acres 11 guntas proposed to be acquired, 71 acres and 11 guntas of land falls within the park area, is by itself sufficient to strike down the impugned notification. ( 43 ) IN writ petition Nos. 17489 to 17493 of 1956 and writ petition No. 4541 of 19s7 concerning the bank officers' co-operative society, the petitioners have alleged that there was no local publication of the preliminary notification as required under Section 4 of the act. The original records relating to the publication has been produced. There is nothing on record to show that there had been local publication of the preliminary notification as required under Section 4 of the act in relation to lands and a report to that effect had been sent to the land acquisition officer. It is well settled position in law that the publication of the preliminary notification under Section 4 of the act in the locality is mandatory and its non-publication renders the final notification invalid. This is an additional ground for allowing writ petition Nos. 17489 to 17493 of 1986. ( 44 ) THE seventh and the last contention urged for the petitioners is that the extent of large scale acquisition of lands in favour of house building co-operative societies within the Bangalore metropolitan city planning area indicate that the power conferred on the government to acquire lands under the Land Acquisition Act has been grossly abused, which has resulted in the circumvention of the Provisions of the Bangalore development authority Act, 1976, virtually rendering the Bangalore development authority workless and purposeless. ( 45 ) ELABORATING this contention, the learned counsel submitted as follows: the legislature has enacted an act called the Bangalore development authority Act, 1976. According to the preamble to the Act, the act was enacted to provide for the development of the city of Bangalore and areas adjacent thereto and for matters connected therewith. It defines the Bangalore metropolitan area thus, under Section 2 (c) of the act:"2 (c ). According to the preamble to the Act, the act was enacted to provide for the development of the city of Bangalore and areas adjacent thereto and for matters connected therewith. It defines the Bangalore metropolitan area thus, under Section 2 (c) of the act:"2 (c ). 'bangalore metropolitan area' means the area comprising the city of Bangalore as defined in the city of Bangalore municipal Corporation Act, 1949 (mysore act 69 of 1949), the areas where the city of Bangalore improvement Act, 1945 (mysore act 5 of 1945) was immediately before the commencement of this act in force and such other areas adjacent to the aforesaid as the government may from time lo time by notification specify. "the expression "development" is defined under Section 2 (j) of the Act, which reads:"2 (j ). 'development' with its grammatical variations means the carrying out of building, engineering or other operations in or over or under land or the making of any material change in any building or land and includes re-development. "section 3 of the act provides for Constitution and incorporation of an authority called "the Bangalore development authority" to carry out the purposes of the act. It reads:"3. Constitution and incorporation of the authority: (1) as soon as may be after the date of commencement of this Act, the government shall, by notification, constitute for the Bangalore development metropolitan area an authority to be called the Bangalore development authority. (2) the authority shall be a body corporate by the name aforesaid having perpetual succession and a common seal, with power, subject to the Provisions of this Act, to acquire, hold and dispose of property both movable and immovable and to contract and shall by the said name sue or be sued. "section 14 of the act specified the objects of the authority. It reads:"14. Objects of the authority - the objects of the authority shall be to promote and secure the development of the Bangalore metropolitan area and for that purpose the authority shall have the power to acquire, hold, manage and dispose of movable and immovable property, whether within or outside the area under its jurisdiction, to carry out building, engineering and other operations and generally to do all things necessary or expedient for the purpose of such development and for purposes incidental thereto. "section 15 of the act confers power on the Bangalore development authority to undertake works and incur expenditure for development of the city of Bangalore and Section 16 of the act prescribes the particulars to be provided for in a development scheme. These sections read:15. Power of authority to undertake works and incur expenditure for development etc. , (1) the authority may, (a) draw up detailed schemes (hereinafter referred to as "development scheme") for the development of the Bangalore metropolitan area; and (b) with the previous approval of the government undertake from time to time any works for the development of the Bangalore metropolitan area and incur expenditure therefor and also for the framing and execution of development schemes. (2) the authority may also from time to time make and take up any new or additional development schemes (i) on its own initiative, if satisfied of the sufficiency of its resources, or (ii) on the recommendation of the local authority if the local authority places at the disposal of the authority the necessary funds for framing and carrying out any scheme, or (iii) otherwise. (3) notwithstanding anything in this act or in any other law for the time being in force, the government may, whenever it deems it necessary require the authority to take up any development scheme or work and execute it subject to such terms and conditions as may be specified by the government. 16. Particulars to be provided for in a development scheme: every development scheme under Section 15 (1) shall, within the limits of the area comprised in the scheme, provide for. 16. Particulars to be provided for in a development scheme: every development scheme under Section 15 (1) shall, within the limits of the area comprised in the scheme, provide for. (a) the acquisition of any land which, in the opinion of the authority, will be necessary for or affected by the execution of the scheme; (b) laying and re-laying out all or any land including the construction and re-construction of buildings and formation and alteration of streets; (c) drainage, water supply and electricity; (d) the reservation of not less than fifteen per cent of the total area of the layout for public parks and playgrounds and an additional area of not less than ten per cent of the total area o'f the layout for civic amenities; (2) may, within the limits aforesaid provide for (a) raising any land which the authority may consider expedient to raise to facilitate better drainage; (b) forming open spaces for the better ventilation of the area comprised in the scheme or any adjoining area; (c) the sanitary arrangements required; (3) may, within and without the limits aforesaid provide for the construction of houses. "section 17 prescribes the procedure to be followed on completion of a scheme. According to Section 17 the draft scheme is required to be published inviting objections and suggestions from the general public and after consideration of the representation, if any, received pursuant to a scheme and modification, if any, made in the light of the representation, the scheme has to be submitted for the approval of the government. Section 18 provides for the sanction of the scheme by the state government and after the scheme is sanctioned Section 19 of the act requires the issue of final notification acquiring the land needed for the purpose of the Bangalore development authority, ( 46 ) RELYING on the above Provisions, the learned counsel submitted that under the scheme of the Act, the entire developmental activities, namely, formation of layouts and allotment of sites to individuals in accordance with the rules framed under the act in the city of Bangalore, that is, Bangalore metropolitan planning area, is vested in the Bangalore development authority. As this act occupies the specific field, namely, the formation of layouts within the Bangalore metropolitan area, there was no question of the government invoking the provisions of the Land Acquisition Act and acquire the lands for the purpose of formation of layouts in favour of the house building societies. The learned counsel for the petitioners stated at the bar that apart from the acquisition of lands in favour of seven respondent-societies, the extent of lands acquired in favour of more than 100 societies within the Bangalore metropolitan area as revealed from g. v. k, rao's report indicate that a large extent of land had been acquired as a result of which the Bangalore development authority constituted under a special enactment for the purpose of development of the city of Bangalore, has been totally or substantially eclipsed, for, no scope is left for the Bangalore development authority to carry on any such activities. The learned counsel submitted that having regard to the object and the purpose of the Bangalore development authority Act, as far as the formation of layouts and allotment of sites to the needy individuals within the city of Bangalore has to be made by the Bangalore development authority and when it is so made by the Bangalore development authority, which is 'state' under Article 12 of the Constitution of India, it would be subject to fundamental right of equality guaranteed under Article 14 of the Constitution and there were also statutory rules framed under the act regulating the distribution of sites to individuals and prohibiting allotment of a site to more than one member of a family and if there were to be any violation of the law, the aggrieved party can seek relief before this court under Article 226 of the Constitution but in the case of societies whose activities are revealed in the inquiry reports they are law unto themselves. Evenso, they submitted that the state government for reasons best known to it, instead of activating and utilising the Bangalore development authority for the purpose of formation of layouts within the city of Bangalore has by its action eclipsed totally the activities of the bangalore development authority and on this ground also the acquisition of lands in favour of house building societies within the Bangalore metropolitan area should be struck down on the ground of circumventing the Provisions of the Bangalore development authority act and on the ground that such action of the government is totally arbitrary and therefore violative of Article 14 of the constitution. The learned counsel for the petitioner submitted that no government acting reasonably would prefer such house building societies to any instrumentality of the state like the Bangalore development authority, particularly when the legislature has provided for its establishment for the purpose of forming layouts and distributing sites within the city. ( 47 ) WE sec considerable force in the contention of the petitioners that when the legislature itself has enacted a special law and constituted the Bangalore development authority for undertaking developmental activities in the bangalore metropolitan area, using the power to acquire the land under the Land Acquisition Act acquiring practically all available land in the area in favour of so many societies, renders the Bangalore development authority workless and purposeless and therefore the exercise of power in the manner and to the extent it is done is arbitrary, for the following reasons: the intention of the legislature in enacting a special law providing for the establishment of an authority like the Bangalore development authority and conferring on it the obligatory function of securing orderly formation of layouts and the distribution of sites according to rules is that all such activities should be carried on by such authority and any requirement of any particular class of workmen or employees or classes of citizens should also be met by formation of special layouts for such classes by that authority itself. Therefore, the formation of layouts for housing within the Bangalore metropolitan area as a Rule must be undertaken by the Bangalore development authority and acquisition of land in favour of any society, if considered feasible, must be only as an exception. Therefore, the formation of layouts for housing within the Bangalore metropolitan area as a Rule must be undertaken by the Bangalore development authority and acquisition of land in favour of any society, if considered feasible, must be only as an exception. Acquisition of large extent of land in the area for which the Bangalore development authority is established, in favour of so many housing societies renders the establishment of Bangalore development authority under a special-law futile and as a result the investment made on the Bangalore development authority has gone a waste to a great extent, for, a little scope is left to the Bangalore development authority for carrying out its obligations under the act. This is a matter for serious consideration by the cabinet sub-committee and the government, in the light of this judgment. ( 48 ) TO sum up, our conclusions on the main issues arising for consideration in these petitions, are as follows: (1) as a result of the amendment to Land Acquisition Act, 1894, by the amending act 68 of 1984, co-operative societies stand classified into the following two categories: (a) those co-operative societies which fall within the expression "corporation owned or controlled by the state" as defined in Section 3 (cc) of the act. In other words, the co-operative societies which fall within the meaning of the word "state" as defined in Article 12 of the Constitution of India. (b) all other co-operative societies, namely, which fall within the meaning of the word "company" as defined in Section 3 (e) of the act. (2) acquisition of land for carrying out any educational, housing, health or a slum clearance scheme sponsored by a co-operative society, which is a company, with the prior approval of the appropriate government constitutes a public purpose and therefore it is not necessary to follow the Karnataka land acquisition (companies) rules, 1973. (3) it is not obligatory for the government to give opportunity of hearing to the owners of land before according prior approval for acquisition of land in favour of a co-operative society, which is company, for carrying out a housing scheme sponsored by it as the Karnataka land acquisition (companies) rules, 1973, are not applicable, as such acquisition of land would be an acquisition for public purpose and not for a company and as no separate rules have been framed prescribing such requirement for granting prior approval. (4) in the absence of any rules prescribing the requirements of a housing scheme to be approved by the government, the question as to whether in a given case the particulars or information furnished by a co-operative society along with its application to the government requesting it to acquire the land for a housing scheme, satisfies the requirement of a housing scheme, has to be decided having due regard to the particulars and information so furnished. (5) the acquisition of land in favour of the six respondent-house building societies, namely, vyalikaval house building co-operative society, h. m. t. employees' co-operative society, bank officers' co-operative society, remco employees' house building co-operative society, amarajyothi co-operative society and Bangalore chickpet house building co-operative society, though stated to be for carrying out housing schemes sponsored by the societies for the allotment of sites to its members, the material placed before us clearly establish that in fact and in truth the acquisition of large extent of land sought by these societies was not for the purpose of any bona fide housing scheme for the benefit of bona fide members of the co-operative society concerned, but was substantially for the purpose of indulging in real estate business, namely, sale of sites in the guise of allotment in favour of either bogus members or in favour of intending purchasers by enrolling them as associate members for the purpose, and making money by those incharge of the societies and their agents with whom the societies had entered into agreements, by exploiting the existence of the great demand for sites and the sky rocketing price for them in the city. The agents of each of these societies had been paid heavy amounts in consideration of which they were required to influence the government and to get the preliminary and the final notifications acquiring large extent of lands, from the government. The decision of the government to acquire the land was brought about by the influence of such agents appointed to be "go between" and "carrycrs" between the government and the society concerned and therefore such a decision is liable to be set aside on the ground that it is a case of colourable exercise of power and suffers from legal mala fides, in that, though the acquisition is stated to be for public purpose, in reality, the acquisition is substantially not for the purpose of bona fide housing schemes. (6) the final notification acquiring lands in favour of jayanagar co-operative housing society in so far it relates to the lands belonging to the petitioners in W. P. No. 3189 of 1988 and connected writ petitions, are liable to be set aside on the ground that inquiry under Section 5-a of the act was not held in accordance with the Karnataka land acquisition rules and the rules of natural justice, as the inquiry which had been stayed pursuant to an interim order granted by this court was continued, after the interim order was vacated, without giving notice of date of hearing and as a result the petitioners were denied the opportunity of hearing on their objection to the acquisition. (7) there is considerable force in the contention of the petitioners that acquiring large extent of lands for formation of large number of societies in the area for which the Bangalore development authority is constituted under an act of legislature and on whom the obligatory function of formation of layouts and distribution of sites to citizens is vested, has the effect of circumventing the Provisions of the B. D. A. act and rendering the Bangalore development authority workless and purposeless and therefore as a Rule, the formation of layouts in the city should ordinarily be undertaken by the Bangalore development authority and only as an exception the work may be permitted to be undertaken by any housing co-operative society after satisfying its suitability, merit and bona fides and therefore requires serious consideration by the government. ( 49 ) BEFORE concluding, it is necessary to observe that as pointed out in the report of g. v. k. rao, it is on account of unlimited territorial jurisdiction and vague Provisions as to who could become members and associate members and also as to what arc the rights of associate members, it has been possible for many of the societies to manipulate membership in such a way as to enroll all those who are desirous of purchasing sites as also those who do not possess the territorial or other qualification as members. As the matter is being examined by a cabinet sub-committee, we are of the view that in order to avoid such a confusion and to prevent the abuse of provision for acquisition of land in favour of house building co-operative societies, it is necessary to take a few corrective steps. As the matter is being examined by a cabinet sub-committee, we are of the view that in order to avoid such a confusion and to prevent the abuse of provision for acquisition of land in favour of house building co-operative societies, it is necessary to take a few corrective steps. Some of them are: (1) the territorial jurisdiction of each of the house building co-operative societies should be specifically indicated in ihe byelaws and no overlapping of the territorial j urisdiction by another house building co-operative society should be allowed and only bona fide residents within the territorial jurisdiction alone should be allowed to become members. (2) in cases of house building societies formed in respect of employees of any organisation or industry, the membership should be confined only to the employees who may continue as members even after retirement and the societies should be prohibited from enrolling outsiders as members. (3) even if a provision is made for enrolling nominal or associate members in the byelaws of a housing society, they should also be bona fide residents within the territorial limits of the society concerned and they should be rendered ineligible for allotment of sites. (4) dual membership or a member of the family of a member of a society, becoming member in another housing society should be prohibited and if it is found that such members were enrolled, their membership should be treated as void. (5) in the light of the above criteria and any other criteria considered necessary by the registrar of co-operative societies, the byelaws of all the house building co-operative societies should be scrutinised by the registrar and he should call upon each of the house building societies to make necessary amendments of the byelaws in exercise of his powers under sub-section (5) of Section 12 of the act and if any society fails to do so within the time specified, he himself should proceed to amend the byelaw in exercise of his powers under sub-section (6) of Section 12 of the act. (6) it is also necessary that the government should frame rules for according previous approval for acquisition of any lands in favour of any of the house building societies inter alia prescribing the essential requirements of a housing scheme and also prescribing the procedure for inquiry and report, to aid the government to come to the conclusion as to whether previous approval should be given for any scheme prepared by any of the house building societies which requires the government to acquire any land or carrying out any such scheme. ( 50 ) IN the result, we make the following order; i. In W. P. nos, 17775 and 17776 of 1986, 21417/1986, 21316/1986, 17159 to 17163/1987, 17700 and 17701/1987, 17458/1987, 17699/1987, 17792/1987, 18003/1987, 16154 to 16156/1987, 1453/1988, 6803/1988, 7683 to 7699/1988, 8132/1988, 8761/1988, 12504 to 12511/1988, 13357 to 13365/1988, 17489 to 17493/1986, 4541/1987, 17841/1987, 437/1988, 16494/1988, 15625/1987, 6977/1988,12874/1988 and 3271 to 3276/1988: (i) the writ petitions are allowed; (ii) the final notification issued under Section 6 of the Land Acquisition Act impugned in each of the petitions, is set aside; ii. In W. P. Nos. 3189 and 3190/1988,8304 to 8306/1988,6940 to 6952/1988,7060 to 7063/1988 and 6810/1988: (i) the writ petitions are allowed; (ii) the impugned final notification issued under Section 6 of the Land Acquisition Act is quashed only in so far as it relates to the lands belonging to the petitioners. --- *** --- .