G. BIKSHAPATHY, J. ( 1 ) THE matter arises under the provisions of the Urban Land (Ceiling and Regulation) Act, 1976. ( 2 ) ALL the Writ Petitions can be disposed of by common Order. In W. P. No, 23773 of 1998, a challenge was made to the process of taking over possession of the urban land by the Respondents without passing final Orders under Section 20 (2) of the Urban Land (Ceiling and Regulation) Act, 1976 while W. P-No. 33741 of 1998 was Bled challenging the notification issued by the Government in G. O. Ms. No. 630 dated: 26. 7. 1997 withdrawing the exemption already granted and for consequential declaration that the notices issued under section 10 of Urban Land (Ceiling and Regulation) Act, 1976 is illegal and without jurisdiction. W. P. No. 9481 of 1999 was filed seeking declaration that the provisions of Urban Land (Ceiling and: Regulation) Act, 1976 are not applicable to the excess land held by the petitioner-Company in view of repealing Act 5 of 1999 which entered the force with effect from 11-1-1999. ( 3 ) THE decision in W. P. No. 33741 of 1998 would govern the other Writ Petitions. Therefore, we refer to the facts narrated in the aforesaid Writ Petition for proper appreciation of the issue. ( 4 ) THE case of the petitioner is that it is a Public Limited Company registered under the Companies Act having Registered Office at Madras and Corporate Office at Bangalore. It is a part of U. B. Group of Companies. The petitioner owns large extent of lands at various places in India for the purpose of establishment of its manufacturing plants. ( 5 ) M/s. Hindustan Polymers Limited Visakhapatnam was engaged in manufacture of Polystyrene, Styrenemonomer etc. The installed capacity of that Company was 7,500 M. Ts enhanced to 40,000 M. Ts. The said Company had filed necessary statements under the Urban Land Ceiling Act and it was declared surplus landholder. However, the Government issued G. O. Ms. No. 1033, dated 8-10-1992 granting exemption to M/s. Hindustan Polymers to an extent of 67. 2165 Hectares from the provisions of the Chapter-Ill of the Act subject to certain conditions stipulated therein. The said Company had filed necessary statements under the Urban Land Ceiling Act and it was declared surplus landholder. However, the Government issued G. O. Ms. No. 1033, dated 8-10-1992 granting exemption to M/s. Hindustan Polymers to an extent of 67. 2165 Hectares from the provisions of the Chapter-Ill of the Act subject to certain conditions stipulated therein. Subsequently, M/s. Hindustan Polymers was declared as a sick company and amalgamated with M/s. Me Dowell Company, the petitioner-Company by the Orders passed by the Bombay High Court and Madras High Court in Company petitions. Thus the assets and liabilities of the M/s. Hindustan Polymers vested in the petitioner M/s. Me Dowell Company. ( 6 ) WHILE the matter stood thus, the Government issued notice dated 19-7-1996 to show-cause why the action should not be taken to withdraw the exemption granted in G. O. Ms. No. 1033, to which reply was submitted on 29-10-1996 giving reasons under which the conditions could not be fulfilled and sought permission for transfer of lands to M/s. L. G. Polymers India Private Limited. The petitioner also sought permission of the Government to utilise the Waltair uplands situated in S. Nos. 1011/36 of Block No. 39 of Waltair Ward for establishing Beach Resorts, Hotels etc. The Government issued G. O. Ms. No. 526, dated 21-6-1997 permitting the petitioner to transfer the land to M/s. L. G. Polymers, but, however, rejected the request of the petitioner for converting the lands at Waltair uplands, as holiday resorts and stated that separate Orders will be passed. It is the case of the petitioner that no final Orders were received by the Company. But, however, they received a copy of the letter dated 6-7-1998 which was addressed by the Special Officer, Urban Land Ceiling, Visakhapatnam to the Chief Manager, Reserve Bank of India, Hyderabad to issue a revised demand draft for Rs. 51,977-50ps. on Bangalore towards the value of the excess land. The petitioner made enquiries with regard to the said notification and ultimately found that the Respondents published notices under Section 10 of Urban Land (Ceiling and Regulation) Act, 1976 (for short the act ) and thereafter took possession of the lands at Waltair uplands. 51,977-50ps. on Bangalore towards the value of the excess land. The petitioner made enquiries with regard to the said notification and ultimately found that the Respondents published notices under Section 10 of Urban Land (Ceiling and Regulation) Act, 1976 (for short the act ) and thereafter took possession of the lands at Waltair uplands. Since the proceedings were issued without initiating action under sub-section (2) of Section 20 and without cancelling the exemption Order, the Company filed W. P. No. 23773 of 1998 challenging the alleged payment of compensation without passing any orders. ( 7 ) IN the counter filed in the aforesaid Writ Petition, it was stated by the Government that the exemption granted in G. O. Ms. No. 1033, dated 8-10-1992 in so far as it related to an extent of 4. 3101 Hectares was cancelled by G. O. Ms. No. 630 dated 26-7-1997. In view of this averment in the counter the petitioner filed the present Writ Petition No. 33741 of 1998 challenging the said G. O. It is the contention of the petitioner that no such G. O. was served on the petitioner and consequential proceedings are wholly illegal and without jurisdiction. Even on the merits also, it is submitted that the said G. O. is illegal and arbitrary. It is submitted by the petitioners that when once the exemption was granted under Section 20 (l) (a) of the Act in public interest, the same cannot be cancelled without giving proper reasons. Therefore, it is submitted that the impugned G. O. is bad for not disclosing the reasons in the Order. It is also submitted by the petitioner that even assuming that the G. O. is valid, yet, the proceedings under Section 10 cannot be straightaway invoked by the authorities. When the exemption granted was cancelled again provisions of Chapter-III would come into force and the petitioner is required to file fresh statements under Section 6 and follow the other proceedings. It is also stated that under Rule 3, when an exemption granted is cancelled again all the provisions have to be followed and it is a mandatory requirement. When once the exemption is withdrawn, statements under Section 6 (1) will have to be filed within 90 days and thereafter further proceedings have to be proceeded with under Sections 8, 9 and 10. No such mandatory procedures have been followed. When once the exemption is withdrawn, statements under Section 6 (1) will have to be filed within 90 days and thereafter further proceedings have to be proceeded with under Sections 8, 9 and 10. No such mandatory procedures have been followed. Even it is the admitted case of the Government that the procedure as contemplated under Sections 6 to 10 have not been followed. Hence, it is a violation of the statutory provision as contained in Rule 6 of the Urban Land (Ceiling and Regulation) Rules. It is also stated that the impugned Order is also illegal, inasmuch as, no just compensation has been paid before passing the orders and therefore, it is violative of Article 300-A and Article 19 (l) (g) of the Constitution of India. It is also submitted by the teamed Counsel for the petitioner that the very initiation of the proceedings seeking to cancel the exemption is also illegal and without jurisdiction, inasmuch as, the proceedings could not be initiated tilt the expiry of the time granted extending the period under the original G. O. Ms. No. 1033. ( 8 ) ALMOST similar counters have been filed by the Respondents stating that the M/s. Hindustan Polymers was declared to have held 101. 398 Sq Mts. In Visakhapatnam areas in various survey numbers and after the scrutiny, it was found to be surplus landholder to the extent of 76. 9585 Hectares. Thereafter, a notification was issued under Section 10 (1) of the Act. The Government, on an application made by the M/s. Hindustan Polymers exempted 61. 285 Hectares in G. O. Ms. No. 1033 with certain conditions and the balance 9. 7420 Hectares surplus land was to be taken from the Company. However, 7. 7986 Sq. Mts. were taken possession of and the balance is yet to be taken from the Company. A report sent by the District Collector, Visakhapatnam to the effect that the exemption was granted by the Government in view of the establishment of projects U. B. Elastomers Limited and U. B. Petro Chemicals Limited. The said projects were shifted to Gujarat and hence there was no need for residential accommodation for which the government granted exemption over an extent of 4. 3101 Hectares in T. S. No. 1011/ part of Waltair uplands and 1. 0230 Hectares in T. S. No. 7/b of Gopalapatnam. The said projects were shifted to Gujarat and hence there was no need for residential accommodation for which the government granted exemption over an extent of 4. 3101 Hectares in T. S. No. 1011/ part of Waltair uplands and 1. 0230 Hectares in T. S. No. 7/b of Gopalapatnam. Therefore, he recommended for cancellation of exemption Order in respect of land at Waltair uplands. On the said report of the Collector, a show-cause notice was issued to the petitioner on 19-7-1996. To the said show-cause notice, the Company filed a representation on 22-7-1996, the Government after careful consideration passed G. O. Ms. No. 526, dated 21-6-1997 permitting the M/s. Hindustan Polymers to transfer the lands situated in Venkatapuram, Vepagunta and Gopalapatnam villages to M/s. L. G. Chemicals Limited, but, however, rejected in respect of 4. 3101 Hectares situated in Waltair uplands. Accordingly, the Government issued G. O. Ms. No. 630 in exercise of the powers of sub-section (2) of Section 20 of the Act withdrawing the Orders passed in G. O. Ms. No. 1033 and thereafter, notifications under Sees. 10 (1), 10 (3) and 10 (5) were issued and ultimately even though the declarant was not present, the possession of the land was taken and thereafter, it was earmarked for construction of office building. At this point of time, the present Writ Petition has been filed. ( 9 ) IT is the case of the Government that by virtue of the powers vested under Section 20 (l) (a) of the Act, exemption was granted subject to certain conditions. Since the conditions were not fulfilled, the exemption which was already granted was cancelled by the impugned G. O. and therefore, there is no illegality or irregularity in the Order passed by the Government in the impugned G. O. Subsequent to passing G. O. further action was also taken by serving notice under Section 10 and possession was taken in absentia of the petitioner-Company. Thus, they submit that the Order is quite legal and valid and the same is unassailable. ( 10 ) THE learned Counsel for the petitioner- Company submits that the very initiation of the cancellation proceedings is illegal and without jurisdiction and the Company ought not to have initiated the cancellation proceedings before the expiry of the time granted. It is his case that originally, exemption was granted in G. O. Ms. ( 10 ) THE learned Counsel for the petitioner- Company submits that the very initiation of the cancellation proceedings is illegal and without jurisdiction and the Company ought not to have initiated the cancellation proceedings before the expiry of the time granted. It is his case that originally, exemption was granted in G. O. Ms. No. 1033 subject to fulfilment of certain conditions. On the request of the Company, the time was granted for fulfilling the conditions in Memo dated 25-11-1994 up to the end of December, 1996 so as to satisfy the conditions imposed in G. O. Ms. No. 1033. But, however, even before December, 1996 proceedings were initiated for cancellation. Thus he submits that issue of show-cause notice was premature and consequently the subsequent orders are illegal and without jurisdiction. ( 11 ) ON the other hand, the. learned Advocate General appearing for the Respondents submit that this contention cannot be accepted, inasmuch as, the petitioner never raised such a contention before the Government or in this Writ Petition also. The petitioner having actively participated at the show-cause notice level and having not taken any such objection, it would not be appropriate for the petitioner to contend that the proceedings are without jurisdiction. I find force in the contention of the learned Advocate General. It is true that the Government has granted exemption subject to fulfilment of certain conditions within a period of two years and the said period was again extended up to December, 1996, but yet, before expiry of the said period, the proceedings were initiated at the instance of the District Collector to cancel exemption granted in G. O. Ms. No. 1033. But, such a contention was never raised before the Government in pursuance of the show cause notice nor such a plea was taken in the Writ Petition. Even though, the contention raised by the learned Counsel for the petitioner, is substantial question going to the root of the matter, but yet, when no proper base has been made and the petitioner having not taken such a plea, even at the show-cause notice level, I am of the considered view that such a plea cannot be allowed to be raised in this Writ Petition. May be that plea is legal plea, but since that plea was not raised at the appropriate time, the petitioner acquiesced the right to reagitate the same in subsequent proceedings. May be that plea is legal plea, but since that plea was not raised at the appropriate time, the petitioner acquiesced the right to reagitate the same in subsequent proceedings. Therefore, I have to necessarily reject this contention. ( 12 ) THE next question that calls for consideration is whether the impugned G. O. cancelling the exemption granted in G. O. Ms. No. 1033 is legal and valid? ( 13 ) IT is necessary to trace out the history leading to the exemption and thereafter initiating action by issuing show-cause notice and finally issuing the impugned order. ( 14 ) THE admitted facts in this regard are: M/s. Hindustan Polymers which was subsequently, merged in the M/s. Mc Dowell Company, the petitioner herein has filed a statement as required under Section 6 (1) of the Act showing its holdings under Visakhapatnam Agglomeration area as under: S. No Name of the Village/ward Survey Extent No. declared in Hec. sq. mts. 1. Venkatapuram 1/betc. 51. 4495 2. Vepagunta 77/1 etc. 34. 8730 3. Gopalapamam 7/b 1. 0239 4. Gopalapatnam 8/1 0. 6396 5. Gopalapatnam 8/2 0. 6882 6. Gopalapatnam 9/a 1. 6471 7. Gopalapatnam 9/1a 1. 5060 8. Gopalapatnam 10/1 5. 2611 9. Waltair Ward 1011/p 4. 3101 101. 3985 after due enquiry, the Company was declared as surplus landholder to the extent of 76. 9585 Hectares. The details of which are as follows: s. No. Name of the Village/ward sy. No. Total extent in Hec. Sq. mts. Extent Allowed in Hec. Sq. mts. Surplus declared in Hec. sq. mts. S. No. Name of the Village/ward Sy. No. Total extent in Hec. Sq. mts. Extent Allowed in Hec. Sq. mts. Surplus declared in Hec. sq. mts. 1. Venkatapuram 1/b etc. 51. 4495 0. 1500 27. 0095 24. 2900 2. Vepagunta 77/1 etc. 34. 8730 - 34. 8730 3. Gopalapatnam 7/b 1. 0239 - 1. 0239 4. Gopalapamam 8/1 0. 6396 - 0. 6396 5. Gopalapamam 8/2 0. 6882 - 0. 6882 6. Gopalapatnam 9/a 1. 6471 - 1. 6471 7. Gopalapatnam 9/1a 1. 5060 - 1. 5060 8. Gopalapamam 10/1 5. 2611 - 5. 2611 9. Waltairward 1011/p 4. 3101 - 4. 3101 101. 3985 24. 4400 76. 9585 the surplus declared became final and it was published in the A. P. Gazette dated 24-12-1985 under Section 10 (1) of the Act. Gopalapatnam 9/a 1. 6471 - 1. 6471 7. Gopalapatnam 9/1a 1. 5060 - 1. 5060 8. Gopalapamam 10/1 5. 2611 - 5. 2611 9. Waltairward 1011/p 4. 3101 - 4. 3101 101. 3985 24. 4400 76. 9585 the surplus declared became final and it was published in the A. P. Gazette dated 24-12-1985 under Section 10 (1) of the Act. But, however, the Company made an application before the Government under Section 20 (l) (a) of the Act to exempt the lands for expansion of the existing Industrial Infrastructure for ABS projects and Styrene and Polystyrene and also for construction of the residential houses for the officers of M/s. Hindustan Polymers and also U. B. Elastomers Limited and U. B. Petro Chemicals Limited. The Government having considered the matter, granted exemption by virtue of the powers vested in it under Section 20 (l) (a) of the Act subject to fulfilment of certain conditions. The relevant portion in G. O. Ms. No. 1033 is extracted below:"now, therefore, in exercise the powers conferred by clause (a) of subsection (1) of Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 (Central Act 33 of 1976), the Government of Andhra Pradesh hereby exempts the lands measuring an extent of 27. 0075 hectors and 34. 8730 hectors situated at Venkatapuram and Vepagunta villages respectively and an extent of 1. 0239 hectors situated in S. No. 7/b in Gopalapatnam village in Visakhapatnam Urban Agglomeration for expansion of the existing industrial infrastructures for A. B. S. Project and Styrene/polystyrene Projects and also an extent of 4. 3101 hectors at Waltair uplands in Visakhapatnam Urban Agglomeration for construction of residential accommodation for Officers of Hindustan Polymers Division as well as U. B. Elastomers Limited and U. B. Petro Chemicals Limited subject to the following conditions: (a) The work on the A. B. S. Project and Styrene/polystyrene projects should be started within six months and completed before the end of 1994. (b) The Company shall submit a report to both the Commissioner of Land Reforms and Urban Land Ceilings as well as the Commissioner of Industries every six months indicating the progress of the project; (c) The Company shall commence construction of residential accommodation for the workers within 6 months and shall submit progress report every six months to Commissioner of Lan d Reforms and Urban Land Ceilings; (d) The Company shall obtain, within one year, the necessary approvals for the Butyl Rubber Project (U. D. Elastomers Limited) and Naphtha Cracker Project (U. B. Petrochemicals Limited) within one year. They shall also submit a report within 3 months to the Commissioner of Land Reforms and Urban Land Ceilings and the Commissioner of Industries the detailed schedule for implementation of the projects and shall execute the projects accordingly; (e) The Company shall not utilise the land at Waltair uplands but kept it in the present condition till such time as the A. D. S. and for Styrene/ Polystyrene Projects as well as the quarters for workmen of Hindustan Polymers Limited are completed. Thereupon, the Company shall not utilise more than two hectors of this land for construction of residences for Officers of the Hindustan Polymers. They shall utilise the balance land only after the Butyl Rubber Project and Naphtha Crackers Projects as well as the residential accommodation for workmen for these projects is well under way; (f) That the Company shall not alienate the land under any circumstances by sale or otherwise; (g) Failure to comply with any or all of these conditions shall render exemption void; (h) That the land should be utilised for the purpose for which it is retained failing which the exemption granted shall be liable for cancellation and the exempted land will be subject to the provisions of the Urban Land (Ceiling and Regulation) Act, 1976; and (i) That the land may be mortgaged to any Bank as defined in clause (iii) of sub-section (1) of Section 19 of the said Act including Andhra Pradesh State Financial Corporation for the purpose of raising finances for the industry. " when it was brought to the notice of the Government that U. B. Elastomers Limited and U. B. Petro Chemicals Limited were shifted to Gujarat and exemption of 4. " when it was brought to the notice of the Government that U. B. Elastomers Limited and U. B. Petro Chemicals Limited were shifted to Gujarat and exemption of 4. 3101 Hectares of land situated at Waltair uplands in Visakhapatnam Agglomeration, was no more required for construction of the residential houses, the Government issued show-cause notice on 12-1-1994 calling upon the petitioner to show-cause why the exemption granted under Section 20 of the Act in respect of 4. 3101 Hectares should not be withdrawn. But, however, on explanation submitted by the petitioner company, the matter was considered and the Government extended the time for a period of two years from December, 1994 to December, 1996 in the Memo dated 25-11-1994. Paras 6 and 7 of the said Memo are relevant which are extracted below: "and whereas, Government have carefully examined the representations of M/s. Hindustan Polymers Limited in the reference second cited and they have decided to grant extension of time for another two years from the end of December 1994 for the entire land exempted in G. O. Ms,no. 1033, Revenue (UC. III) Department, dated 8-10-1992. Government accordingly hereby accord extension of time of two years from the end of December, 1994 to M/s. Hindustan Polymers Limited exempted in G. O. Ms. No. 1033, Revenue (UC. III) Department, dated 8-10-1992 so as to utilise the land for the purpose for which exemption was granted, subject to condition that the exemption granted in the above G. O. shall stands cancelled. If the Company fails to satisfy the conditions imposed in G. O. Ms. No. 1033, Revenue (UC. III) Department, dated 8-10-1992. " but, however, the District Collector, Visakhapatnam suggested and recommended that the extension of time up to the end of December was required to be re-examined and basing on the said recommendation of the District Collector, show-cause notice dated 19-7-1996 was issued to the petitioner to show cause why the exemption in so far as it related to an extent of 4. 3101 Hectares in Waltair uplands and 1. 0239 Hectares in Visakhapatnam should not be revoked. Paras 7 and 8 of the said show-cause notice are extracted below: "and whereas, the District Collector, Visakhapatnam has now suggested and recommended that the extension of time granted up to 31-10-1996 may be re- examined and cancel the exemption granted in G. O. Ms-No. 1033, Revenue (UC. 0239 Hectares in Visakhapatnam should not be revoked. Paras 7 and 8 of the said show-cause notice are extracted below: "and whereas, the District Collector, Visakhapatnam has now suggested and recommended that the extension of time granted up to 31-10-1996 may be re- examined and cancel the exemption granted in G. O. Ms-No. 1033, Revenue (UC. I1i) Department, dated 8-10-1992 and also the extension of time granted up to 31-12-1996 in Government Memo 10th cited may be withdrawn from the Company for the lands held by them in respect of T. S. No. 1001/36 Block No. 39, Waltair Ward measuring 4. 3101 Hectares and Sy. No. 7/b, Gopalapatnam village measuring 1. 0239 Hectares totalling to 5. 3340 Hectares for the following reasons: (i) the ownership of M/s. Hindustan Polymers Limited, U. B. Elastomers Limited and U. B. Petro Chemicals Limited are different and that the request of M/s. Hindustan Polymers Limited for grant of exemption for use by other companies is not desirable; (ii) The Special Deputy Collector (LA) APIIC Limited be reported that no land was acquired or handed over APIIC Limited to M/s. Hindustan Polymers Limited etc. and thus the claim requesting for extension of time exemption is genuine. (iii) The projects were reported to be shifted to Gujarat collected through reliable unofficial sources and thus there is no need for residential accommodation for the officials. Now, therefore, M/s. Hindustan Polymers Limited, Visakhapatnam are hereby directed to show-cause within a period of fifteen (15) days from the date of receipt of the Memo as to why the exemption granted in. the Government Order first cited and also the extension of time of 2 years granted up to December, 1996 in Government Memo 10th cited in so far as the lands measuring to an extent of Hec. 5. 2340 (4. 3101 Hec. in T. S. No. 1011 /36 of Block No. 39, at Waltair uplands and the extent of land measuring 1. 0239 Hec. situated in Sy. 5. 2340 (4. 3101 Hec. in T. S. No. 1011 /36 of Block No. 39, at Waltair uplands and the extent of land measuring 1. 0239 Hec. situated in Sy. No-7/b in Gopalapatnam village in Visakhapatnam Urban agglomeration should not be withdrawn by the Government under the provisions of sub-section (2) of Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 (Central Act 33 of 1976) for violation of the conditions imposed in the exemption order first cited, and if no representation is received within the above stipulated period, it will be construed that they have no representation to make in this regard and further action will be taken in the matter based on the material available with the Government. " to the said show-cause notice, the petitioner submitted a detailed reply and finally the Government issued G. O. Ms. No. 526 dated 21-6-1997 permitting the petitioner to transfer certain lands to another Company, subject to fulfilment of certain conditions. But, however, in the same proceedings, the Government rejected the request of the petitioner for development of Beach Resorts and Hotels over an extent of 4. 3101 Hectares situated at Waltair uplands. The following is the extract of the said G. O: "the Government after careful examination of the matter and in exercise of the powers conferred by clause (a) of the sub-section (1) of the Section 20 of Urban Land (Ceiling and regulation) Act, 1976 (Central Act 33 of 1976) and in modification of the orders issued in the G. O. 1st read above, hereby permit the M/s. Hindustan Polymers Limited, Visakhapatnam to transfer the following lands in favour of M/s. L. G. Chemicals Limited of L. G. Group of South Korea for the purpose of expansion of existing industry subject to the following conditions: venkatapuram village 27. 0096 Hectares vepagunta village 34. 8730 gopalapatnam village 1,0239 conditions: (a) that the proposed new investment of Rs. 0096 Hectares vepagunta village 34. 8730 gopalapatnam village 1,0239 conditions: (a) that the proposed new investment of Rs. 100 crores will be brought about within a period of three years from the date of issue of this orders; (b) that it should not be leased out or sold without the prior permission of the Government; (c) that the land should be utilised for the purpose of Petro Chemical Industry only with in three years from the date of grant of permission failing which the permission granted shall stand cancelled and the said land will become, subject to the provisions of the Urban Land (Ceiling and Regulation) Act, 1976, as excess land; (d) that the land may be mortgaged to any Bank as defined in clause (iii) of subsection (1) of Section 10 including Andhra Pradesh State Financial Corporation for the purpose of raising finances for the Industry; (e) that the purchasing Company should file Statement under section 15 of the Urban Land (Ceiling and Regulation) Act, 1976 before the Special Officer and Competent Authority, Urban Land Ceiling, Visakhapatnam. The Government hereby reject the request of M/s. Hindustan Polymers Limited, Visakhapatnam for development of Holiday Resort over an extent of 4. 3101 Hectares situated at Waltair uplands" the Government passed final Orders in G. O. Ms. No. 630, dated 26-7-1997 the impugned Order. The relevant portion is extracted below: "and whereas, the Government after careful examination of the matter have issued Orders in the G. O. 5th read above permitting M/s. Hindustan Polymers Limited, Visakhapatnam (Now L. G. Polymers India Private Limited, Visakhapatnam) transfer the land situated at Venkatapuram, Vepagunta and Gopalapatnam in favour of M/s. L. G. Chemicals (India) Private Limited for the purpose of expansion of existing industry, subject to certain conditions, but rejected the request of M/s. Hindustan Polymers Limited, Visakhapatnam (now L. G. Polymers India Private Limited, Visakhapatnam) for development of Holiday Resort in an extent of 4. 3101 Hectares situated at Waltair uplands; now, therefore, in exercise of the powers conferred under sub-section (2) of Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 (Central Act 33 of 1976) the Government of Andhra Pradesh hereby withdraw the Orders issued in G. O. Ms. No. 1033, Revenue (U. C. HI) Department, dated 8-10-1992 granting exemption to an extent of land measuring 4. No. 1033, Revenue (U. C. HI) Department, dated 8-10-1992 granting exemption to an extent of land measuring 4. 3101 Hectares situated in Waltair uplands, Visakhapatnam, in Visakhapatnam Urban Agglomeration in favour of M/s. Hindustan Polymers Limited, Visakhapatnam (now L. G. Polymers India Private Limited, Visakhapatnam)"the learned Counsel for the petitioner submits that basing on the above said records the Government have not applied their mind and mechanically has passed an Order rejecting the exemption granted in respect of 4. 3101 Hectares situated at Waltair uplands. No reasons were assigned in the impugned Order and therefore, on that ground alone the Order is liable to be set aside. He submits that the relaxation was granted in public interest and therefore, the Government ought to have seen whether any public interest exists in the application made by the Company. He also takes the assistance of the Supreme Court judgment reported in T. R. Thandur vs. Union of India. ( 15 ) IN this regard, it is necessary to observe that the intention of the Legislature in enacting the Urban Land (Ceiling and Regulation) Act, 1976 was to acquire all vacant land in excess of the ceiling limit prescribed by the Act and the main purpose of the Act, was three-fold, viz. (i) to prevent concentration of the urban land in the hands of a few persons, and to prevent speculation and profiteering therein; (ii)to distribute the urban land equitably and (iii) to regulate the construction of buildings on the urban lands. Consistent with these objectives, the Act provides for acquisition of all urban vacant land in excess of the ceiling limit and prohibits its transfer in any form absolutely. Therefore, in respect of all such excess land which vested with the Government, it is open for the Government to grant exemption under Section 20 or permitting the excess landholder to retain under Section 21 or 22 as the case may be. For proper appreciation of the case, it is necessary to extract Section 20, which reads thus:"section 20. Power to exempt. For proper appreciation of the case, it is necessary to extract Section 20, which reads thus:"section 20. Power to exempt. (1) Notwithstanding anything contained in any of the foregoing provisions of this Chapter (a) where any person holds vacant land in excess of the ceiling limited and the State Government is satisfied, either on its own motion or otherwise, that having regard to the location of such land, the purpose for which land is being or is proposed to be used and such other relevant factor as the circumstances of the case may require, it is necessary or expedient in the public interest so to do, that Government may, by Order, exempt subject to such conditions, if any, as may be specified in the Order, such vacant land from the provisions of this Chapter, (b) where any person holds vacant land in the excess of the ceiling limit and the State Government, either on its own motion or otherwise, is satisfied that the application of the provisions of this Chapter would cause undue hardship to such person, that Government may by Order exempt subject to such conditions if any, as may be specified in the Order, such vacant land from the provisions of this Chapter: provided that no Order under this clause shall be made unless the reasons for doing so are recorded in writing. (2) If any time the State Government is satisfied that any of the conditions subject to which any exemption under clauses (a) and (b) of sub-section (1) is granted is not complied with by any person, it shall be competent for the State Government to withdraw, by Order, such exemption after giving a reasonable opportunity to such person for making a representation against the proposed withdrawal and thereupon the provisions of this Chapter shall apply accordingly. "thus, it is to be observed that by virtue of the non-obstante clause, when once the Order of exemption under Section 20 is granted, the exempted land falls outside the provisions of Chapter-Ill. Under Section 20, power is vested with the Government to grant exemption under two categories under clauses (a) and (b ). "thus, it is to be observed that by virtue of the non-obstante clause, when once the Order of exemption under Section 20 is granted, the exempted land falls outside the provisions of Chapter-Ill. Under Section 20, power is vested with the Government to grant exemption under two categories under clauses (a) and (b ). The Government is empowered to grant exemption under clause (a) either suo motu or otherwise having regard to the location of such lands, the purpose for which the land was being used or proposed to be used for other considerations as the circumstances of the case may arise and it was necessary and expedient in public interest to do so exempting the land from provisions of Chapter-III subject to fulfilment of certain conditions. We are not concerned with clause (b) which relates to hardship. In this case, it is only under clause (a) namely public interest the exemption was granted. Dealing with this clause, the Supreme Court in Thandur s case (supra) observed as follows:"11. Clause (a) of sub-section (1) of Section 20 empowers the State Government to grant the exemption if it is satisfied having regard to the relevant factors specified in the clause that it is necessary or expedient to grant the exemption in the "public interest" subject to the conditions specified in the order. Clause (a) specifies certain relevant factors for the purpose of grant of exemption, namely, "location of such land", "the purpose for which such land is being or is proposed to be used" and such other relevant factors as the circumstances of the case may require. Apart from the location of the excess vacant land and the purpose of its use, regard must be had to the other. relevant factors, which is a question of fact in each case. However, these factors must indicate that the grant of exemption under Clause (a) is necessary or expedient in the "public interest. " The expression "public interest" has a legal connotation. The broad guidelines for grant of exemption under Clause (a) are enacted in the provision. A safeguard is provided by requiring conditions to be specified in the order to which the exemption is granted under Clause (a ). " The expression "public interest" has a legal connotation. The broad guidelines for grant of exemption under Clause (a) are enacted in the provision. A safeguard is provided by requiring conditions to be specified in the order to which the exemption is granted under Clause (a ). Even though there is no proviso in Clause (a) of the kind enacted thereafter in Clause (b), yet the absence of such a proviso is inconsequential since the requirement of the expressly enacted proviso in Clause (b) is implicit in the manner of exercise of the power under Clause (a ). The requirement in Clause (a) of making and order having regard to the specified relevant circumstances and specifying conditions attached to the exemption, ensures that the decision is reached for cogent reasons which are placed on record in writing culminating in the making of the written order. There is no scope for the view that exemption can be granted under Clause (a) by an order specifying the conditions having regard to the specified relevant factors without recording the reasons for doing so in writing. Every State action must satisfy the rule of non arbitrariness and, therefore, recording of reasons in writing for granting the exemption under Clause (a) indicating that it is necessary or expedient in the public interest so to do, is an essential requirement of valid exercise of power under Clause (a ). This is how Clause (a) must be construed and understood. "therefore, it is clear that when the Government invokes Clause (a), it has to record reasons indicating that it is necessary and expedient in the public interest to do so and that recording reasons is an essential requirement for valid exercise of power under Clause (a ). Admittedly, in the instant case the Government having recorded the reasons passed Orders in G. O. Ms. No. 1033 exempting a total extent of 67. 2165 Hectares and took possession of 9. 7420 Hectares. ( 16 ) IT is not in dispute that the Company due to various policies of the Government and also various other factors, could not establish U. B. Elastomers Limited and U. B. Petro Chemicals Limited. It is to be noted in this regard that the entire show-cause notice was only with regard to the cancellation of the exemption of 4. It is to be noted in this regard that the entire show-cause notice was only with regard to the cancellation of the exemption of 4. 3101 Hectares in Waltair uplands and that no proceedings were initiated for cancellation of exemption of the other lands. Even in the show-cause notice issued earlier dated 12-1-1994, the Government only called upon the petitioner to show-cause as to why the exemption only in respect of 4. 3101 Hectares in Waltair uplands should not be cancelled and at no point of time proceedings for cancellation of the entire exempted land were initiated. But, however, it appears that the Government proceeded as if the show- cause notice was for the cancellation of the entire exemption granted in G. O. Ms. No. 1033 as can be seen from the final impugned Order. But, be that as it may, we are only concerned in this Writ Petition with regard to the cancellation of the exemption relating to an extent of 4. 3101 Hectares in Waltair uplands. Originally, it was the case of the petitioner that for the purpose of construction of the residential quarters for the workers of M/s. Hindustan Polymers and U. B. Elastomers Limited and U. B. Petro Chemicals Limited an extent of 4. 3101 Hectares was exempted. But, however, it was found that the said U. B. Elastomers Limited and U. B. Petro Chemicals Limited did not establish their Company. It is only at the instance of the District Collector, the Government initiated action to cancel two extents of lands namely 4. 3101 Hectares in Waltair uplands and 1. 0239 in Gopalapatnam village, but the final Orders were passed only cancelling an extent of 4. 3101 Hectares. It is the case of the petitioner that the Company intends to develop Beach Resorts and Hotels on the aforesaid extents as the building of the houses for the accommodation for the construction of the houses for the officers and workers was not found feasible for various reasons. Therefore, they sought permission to utilise this land for the purpose of development of Beach Resorts and Hotels. Therefore, they sought permission to utilise this land for the purpose of development of Beach Resorts and Hotels. It is also stated that Visakhapatnam area has enormous tourists potential and the Waltair uplands is eminently suitable for the development of Beach Resorts and Hotels or establishing Star Hotels and the Company has already established such resorts in outside country namely Maldives and Game Resort in South Africa and it attracts International Tourists and also earns good revenue to the State. It was also in the process of negotiation of acquiring beach Resorts of international standard in Kamataka and Konkan Coasts. It is not in dispute that after exemption of 67. 2165 Hectares, the Company was still found in surplus of 9. 74 Hectares and the possession of the said land was also taken. Even in G. O. Ms. No 1033 in para 3 it was stated that the Commissioner of Industries had recommended exemption subject to surrender of 20 acres of land (about 9 Hectares ). Thus, the exemption was granted subject to surrender of 9 Hectares and subject to public interest clause. It is not in dispute that initially, the exemption was granted in respect of 43101 Hectares on the ground that it was required for construction of the quarters of the officers and the workers of the Company. But, subsequently, when a show cause notice was issued it was made clear to the Government that the construction of quarters was not found feasible and they intended to develop into resorts. The Government in their G. O. Ms. No. 526, dated 21-6-1997 while permitting the Company to transfer various extents of lands in favour of L. G. Group of Companies stated that the Government rejected the request of M/s. Hindustan Polymers for development of Holiday Resorts over an extent of 4. 3101 Hectares, and Orders in this regard will be issued separately. Therefore they expressed their intention to reject the request for development of the Holiday Resorts as proposed by the petitioners. In the impugned G. O. Ms. No. 630, dated 26-7-1997, it only refers to the request of the Company for developing into Holiday Resorts and in pursuance of the decision expressed in G. O. Ms. No. 526, the Government passed Orders to withdraw the Waltair uplands from the exemption granted in G. O. Ms. No. 1033. In the impugned G. O. Ms. No. 630, dated 26-7-1997, it only refers to the request of the Company for developing into Holiday Resorts and in pursuance of the decision expressed in G. O. Ms. No. 526, the Government passed Orders to withdraw the Waltair uplands from the exemption granted in G. O. Ms. No. 1033. In this regard, it is to be observed that while granting exemption under Section 20 (1) (a) of the Act, it is mandatory for the Government to record reasons. Similarly, it has to be noted that under sub-section (2) ofsection 20, it shall be competent for the Government to cancel the exemption Order after giving opportunity to make representation. In pursuance of the show cause notice issued, the petitioner submitted a representation seeking alternate utilisation of the extent of 4. 3101 Hectares. What is required to be considered under Section 20 (1) (a) of the Act as already observed by the Supreme Court in Thandur s case (supra), are the relevant factors for the purpose of granting of exemption under clause (a) viz. , location of such land, the purpose for which the land is being used or proposed to be used or such other relevant factors and the circumstances subject to expediency and public interest. Therefore, what is required to be kept in view by the Government is the location of the land and the purpose for which the land is proposed to be utilised and other relevant factors while exercising the power under Section 20 (1) (a) of the Act. It is not the case of the Government that it has no power to grant exemption for the purpose of developing the land into Beach Resorts and Hotels. It is also not the case of the Government that it was not expedient to grant exemption in public interest. Admittedly, the land was permitted to be used for construction of the quarters which was considered to be public purpose by the Government and the exemption was granted under Sec. 20 (1) (a) of the Act. But, in view of the changed circumstances, Company made alternate proposal for converting the land into Beach Resorts and Hotels and mis Court finds that the Government did not concentrate on this aspect. But, in view of the changed circumstances, Company made alternate proposal for converting the land into Beach Resorts and Hotels and mis Court finds that the Government did not concentrate on this aspect. It is no doubt true that when once the exemption was granted subject to fulfilment of certain conditions and when the conditions were not fulfilled for various reasons, it would be competent for the Government to cancel the exemption, but when the Company makes alternate proposals, it is incumbent on the part of the Government to consider the same keeping in view the provisions laid down in Section 20 (1) (a) of the Act. But, it is not open for the Government to straightaway reject the proposals without giving any reasons. It is well established principle of law that the administrative authorities are required to record reasons when the Orders have the effect of denying the civil rights of the citizens. Fair hearing and fairness in action are essential ingredients in administrative actions. With the exposition of administrative law the Orders of the public authorities cannot be subject to judicial review on the ground of illegality, irrationality and procedural impropriety. This principle is equally applicable, if not more vigorously to the Orders passed by the quasi-judicial authorities. Arbitrariness is antithesis of transparency and fairness. Hence, quasi-judicial authorities are obliged to pass speaking Orders, more especially when Orders adverse to the interest of the petitioner are passed. It is, mandatory on the part of the Government to record reasons when exemption is granted under Section 20 (1) (a) of the Act, but it cannot be said that it need not give any reasons while cancelling the exemption granted under Section 20 (2 ). The purpose of putting on the petitioner on notice and seeking its representation to the proposed action, would become only a paper formality, if the Order does not disclose the proper application of mind and reasons for arriving at a decision. Thus, the Orders of cancellation must not only be supported by the reasons but such reasons must also be relevant to the issue. In the instant case, I do not find any reasons whatsoever leave alone the relevancy, in cancelling the exemption already granted. The impugned Order only says that it was rejected in earlier G. O. Ms. No. 526. therefore, the Order is passed under Section 20 (2) of the Act. In the instant case, I do not find any reasons whatsoever leave alone the relevancy, in cancelling the exemption already granted. The impugned Order only says that it was rejected in earlier G. O. Ms. No. 526. therefore, the Order is passed under Section 20 (2) of the Act. This will not meet the statutory requirement. As observed supra, giving reasons is one of the essential requirements in quasi-judicial proceedings. Failure to observe these principles vitiates the entire proceedings. ( 17 ) IN G. O. Ms. No. 526, the relevant portion reads thus: "the Government hereby reject the request of M/s. Hindustan Polymers Limited, Visakhapatnam for development of holiday resort over an extent of 4. 3101 Hectares situated at Waltair uplands. " thus, I find the impugned Order is devoid of reasons. ( 18 ) UNDER these circumstances, I hold that the impugned G. O. is illegal and contrary to Section 20 (2) of the Act. Accordingly, the G. O. is set aside and the matter is remitted back to the Government for fresh consideration keeping in view the observations made in this Order. The Government shall give an opportunity of personal hearing if sought for by the petitioner. ( 19 ) THE Government shall pass appropriate Orders within a period of three months from the date of receipt of a copy of the order. ( 20 ) IN view of the finding, I need not go into the alternate submission of the learned Counsel for the petitioner that even assuming that impugned Order is valid, yet, invoking Section 10 without following procedure under Sections 6 to 9 of the Act is illegal and hit by proviso to Rule 3 of the Urban Land (Ceiling and Regulation) Rules, 1976 ( 21 ) THE Writ Petition No. 33741 of 1998 is accordingly allowed. No costs. ( 22 ) IN view of the Orders passed in W. P. No. 33741 of 1998, no Orders are necessary in W. P. No. 23773 of 1998 and W. P. No. 9481 of 1999. Accordingly, they are closed. No costs.