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2014 DIGILAW 2082 (BOM)

Reserve Bank Employees v. State of Maharashtra

2014-09-30

M.S.SONAK, MOHIT S.SHAH

body2014
JUDGMENT M.S. Sonak, J. 1. By this petition under Articles 226 and 277 of the Constitution of India, the petitioner questions notice dated 7 April 2000 and the Corrigendum dated 25 May 2001 thereto, issued by the State of Maharashtra under Section 14(1) of the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1972 (Slum Act) for the acquisition of the petitioner's property admeasuring 4780 sq. meters situate at Vile Parle, Taluka Andheri, Mumbai Suburban District bearing CTS Nos. 708, 709, 710 Part, 714/1 Part, 719 Part and 724/1 to 36 (said property). 2. Based upon the application dated 2 August 1993 made by respondent no. 9, an association of slum dwellers, the Deputy Collector (Encroachment) - respondent no. 2, vide notification dated 29 September 1993 declared the said property as a 'slum area' under Section 4(1) of the Slum Act. By notice dated 11 February 1994, respondent no. 2 directed the petitioner to carry out certain improvement works in and over the said property with regard to provision of W.C., water connection, internal roads, sewerage and drainage facilities. Without prejudice to the pending challenge against declaration of the said property as slum area, the petitioner undertook and reported compliances on 13 April 1994. Without verification, respondent no. 2 proceeded to issue notices dated 13 April 1994 and 30 November 1994, proposing further action under Section 5(i)of the Slum Act in the matters of inspection and survey of the said property. The Slum Tribunal by its judgment and order dated 5 October 1996, dismissed the petitioner's appeal challenging the notification dated 29 September 1993 declaring the said property as a 'slum area'. 3. It is the petitioner's case that respondent no. 8 - a builder, was behind the declaration of the entire said property as a slum area, even though, hardly an area of about 839.6 sq. meters, from out of the total of 4780 sq. meters, was affected by the slums. In fact, respondent no. 8, relying upon some correspondence had instituted suit no. 466 of 1995, claiming rights and entitlement to develop the said property. Upon realising that there was no possibility of obtaining any reliefs in the said suit, respondent no. 8 applied to the State Government for acquisition of the said property by resort to the provisions contained in Section 14(1) of the Slum Act. 466 of 1995, claiming rights and entitlement to develop the said property. Upon realising that there was no possibility of obtaining any reliefs in the said suit, respondent no. 8 applied to the State Government for acquisition of the said property by resort to the provisions contained in Section 14(1) of the Slum Act. Predictably, on 13 February 1997, the learned Single Judge of this Court dismissed notice of motion no. 427 of 1995 in suit no. 466 of 1995 instituted by respondent no. 8, holding that at least prima facie the suit itself is not maintainable. The appeal against the order dated 13 February 1997, was also dismissed by the Division Bench on 22 September 1997. 4. Based upon application of respondent no. 8' for acquisition of the said property, the Collector made a report to the State recommending acquisition to the extent of 1843.1 sq. meters from out of the said property. The report very specifically makes reference to application dated 24 January 1997 made by respondent no. 8 for acquisition of the said property. Notice was issued to the petitioner to show cause why the said property should not be acquired by resort to provisions contained in Section 14(1) of the Slum Act. The petitioner, by its response dated 16 October 1997 pointed out that it had complied with the directions contained in the notice dated 11 February 1994, in the matter of providing improvement works. Further, the petitioner was itself willing to redevelop the said property, including by way of protecting the interests of the slum dwellers, who were occupying an area about 839.6 sq. meters. The petitioner pointed out that respondent no. 8 was behind the proposal of acquisition and was bent upon obstructing the petitioner from undertaking redevelopment by themselves. Same position was reiterated by the petitioner through their lawyer's notice dated 26 December 1997. Notwithstanding all this, the State has issued impugned notification dated 7 April 2000 for acquisition of the said property to the extent of 4074.3 sq. meters. Later on, by corrigendum dated 25 May 2001, this area was enhanced to 4780 sq. meters. As noted earlier, the notification dated 7 April 2000 and corrigendum dated 25 May 2001, are the subject matter of challenge in the present petition. 5. meters. Later on, by corrigendum dated 25 May 2001, this area was enhanced to 4780 sq. meters. As noted earlier, the notification dated 7 April 2000 and corrigendum dated 25 May 2001, are the subject matter of challenge in the present petition. 5. This petition, which was instituted in October 2001, was dismissed by judgment and order dated 2 July 2002 on the ground that it was barred by inordinate delay and laches. The Supreme Court however, by its order dated 4 April 2003, in Special Leave Petition (Civil) No. 20800 of 2002, set aside the judgment and order dated 2 July 2002 and remanded the matter for decision on merits. Accordingly, on 24 June 2003, Rule was issued in the present petition and parties were directed to maintain status quo as obtaining on the said date. 6. In the aforesaid circumstances, Mr. Milind Sathe, learned Senior Advocate for the petitioner made the following submissions: (A) That the acquisition proceedings under Section 14(1) of the Slum Act are not in public interest but rather in furtherance of the private interest of respondent no. 8 - builder. Accordingly, the acquisition proceedings are vitiated by malafides and constitute colourable exercise of the power on the part of the State and its Authorities; (B) From the material on record, it is evident that hardly an area of 839.6 sq. meters from out of the said property totally admeasuring 4780 sq. meters is affected by slums. In such circumstances, the acquisition of the entire said property is nothing but arbitrariness prohibited by Article 14 of the Constitution of India. The acquisition of the said property, is consequently without authority of law and in violation of the constitutional guarantee contained in Article300A of the Constitution of India; (C) From the scheme of the Slum Act as also under the provisions of Development Control Regulations 33(10), it is clear that the petitioner as the owner has the first option to develop the property which may be affected by slums. Only where the owner avoids development or is incapable of development that the property in question be acquired by the State by resort to the provisions contained in Section 14(1) of the Slum Act. In the present case, without prejudice, the petitioner had time and again communicated its willingness to develop the said property. Only where the owner avoids development or is incapable of development that the property in question be acquired by the State by resort to the provisions contained in Section 14(1) of the Slum Act. In the present case, without prejudice, the petitioner had time and again communicated its willingness to develop the said property. In such circumstances, the acquisition of the said property was clearly barred; (D) Respondent no. 9, which is the association of slum dwellers, has now filed an affidavit on 2 February 2014 in this petition to the effect that they do not support any development being undertaken by respondent no. 8. The affidavit also states that respondent no. 8 misled slum dwellers by stating that it was both willing and competent to execute the slum redevelopment scheme and therefore neither respondent no. 9 nor any of the individual slum dwellers should grant any consent to the petitioner for undertaking redevelopment of the said property. However, in light of the circumstances that respondent no. 8 did not comply with the requisitions of the SRA as contained in communications dated 18 April 2001 and 28 September 2002, the proposal submitted by the architect of respondent no. 8 has been filed. From the manner in which respondent no. 8 has conducted itself, neither respondent no. 9 nor individual slum dwellers have any confidence in the capacity of respondent no. 8 to undertake the redevelopment scheme. For reasons attributable to respondent no. 8, the project has remained pending for over a decade. In such circumstances, as a matter of abundant caution, respondent no. 9 and the individual slum dwellers have terminated all agreements and arrangements that may have existed between themselves and respondent no. 8. Therefore, no useful purpose would be served by acquisition of the said property. Such acquisition would deprive the petitioner of its valuable property as against payment of illusory compensation of Rs. 30,960/and at the same time there would ensue no corresponding benefits to the slum dwellers, who in any case were occupying hardly 839.6 sq. meters from out of the total area of 4780 sq. meters. 7. Mr. Shailesh Shah, learned Senior Advocate for respondent no. 9 reiterated all that was set out in the affidavit filed by the Chief Promoter of respondent no. 9 on 2 February 2014. Learned counsel submitted that the entire acquisition proceedings were at the behest of respondent no. meters from out of the total area of 4780 sq. meters. 7. Mr. Shailesh Shah, learned Senior Advocate for respondent no. 9 reiterated all that was set out in the affidavit filed by the Chief Promoter of respondent no. 9 on 2 February 2014. Learned counsel submitted that the entire acquisition proceedings were at the behest of respondent no. 8, who mislead respondent no. 9 and its slum dweller members into denying consents for development to the petitioner. It was pointed out that respondent no. 9 as also its slum dweller members had, by way of abundant caution terminated whatever arrangements that may have existed with respondent no. 8 and consequently respondent no. 8 would have no rights or claims with regard to development of the said property. It was also pointed out that respondent no. 9 and its slum dweller members were prepared to issue necessary consents to the petitioner for undertaking development of the said property. For all these reasons, learned counsel submitted that the impugned acquisition notifications ought to be quashed and the petition be allowed. 8. Mr. Mattos, learned AGP for the State submitted that the petition as filed, is clearly barred by delay and laches. There is no explanation for delay of almost 18 months between the issuance of impugned notification dated 7 April 2000 and the filing of the present petition in October 2001. In the meantime, possession of the said property has already been taken over by the State and proceedings have also been initiated for appointment of respondent no. 8 as a builder to redevelop the said property. Mr. Mattos submitted that the issue whether acquisition of such nature was permissible under Section 14(1) of the Slum Act was no longer res integra in view of judgment and order dated 10 May 2013 in writ petition no. 2582 of 2003, where this Court has not only ruled that the provisions of Section 14(1) of the Slum Act are intra vires the Constitution of India, but further acquisition of private properties by resort to the same is legal and permissible. To the same effect is the decision of this Court in the case of Akhtar Rizvi vs. Additional Collector (Enc) & Controller of Slums & Ors., decided on 3 October 2000. 9. Mr. To the same effect is the decision of this Court in the case of Akhtar Rizvi vs. Additional Collector (Enc) & Controller of Slums & Ors., decided on 3 October 2000. 9. Mr. Mattos further submitted that in the present case, the acquisition proceedings have been completed in accordance with law and even the possession of the said property has been taken over by the State. In such circumstances, the said property vests in the State, free from all encumbrances. It is therefore impermissible, at this stage, to grant any relief to the petitioner so as to restore the said property to it. In this regard, Mr. Mattos relied upon the decision of the Supreme Court in the case of State of Kerala & Ors. vs. M. Bhaskaran Pillai & Anr. (1997) 5 SCC 432 . 10. Finally, Mr. Mattos submitted that in case the petitioner were genuinely interested in developing the said property, then they ought to have obtained and produced consents from at least 70% of the slum dwellers. This having not been done, it is clear that the petitioner were in no position to undertake any development of the said property and acquisition by resort to Section 14(1) of the Slum Act, was the only option. Offer to produce consents from the slum dwellers after the conclusion of acquisition proceedings is not at all a genuine offer and in any case the same is quite belated and therefore irrelevant to the validity of the acquisition proceedings. For all these reasons, Mr. Mattos submitted that petition as filed is liable to be dismissed. 11. Mr. Y.S. Bhate, learned counsel for respondent no. 8 while opposing the petition, adopted the submissions made by Mr. Mattos. Further, Mr. Bhate submitted that the acquisition proceedings were entirely in order, and there was no warrant to interfere with the same. Mr. Bhate also submitted that the agreements between respondent no. 8 and respondent no. 9 are valid and there is no provision which entitles the slum dwellers to withdraw consents validly granted. Mr. Bhate pointed out that respondent no. 8 has made extensive investments in settling the claims of the parties and therefore the petition, which is even otherwise barred by delay and laches, may not be entertained. 12. The rival contentions now fall for our determination. 13. Mr. Bhate pointed out that respondent no. 8 has made extensive investments in settling the claims of the parties and therefore the petition, which is even otherwise barred by delay and laches, may not be entertained. 12. The rival contentions now fall for our determination. 13. The objection that the petition is barred by delay and laches, in our opinion, cannot be raised by the respondents, at this stage. As noted earlier, by judgment and order dated 2 July 2002, this Court had dismissed the petition on the grounds of delay and laches. However, the Supreme Court by order dated 4 April 2003, set aside the judgment and order dated 2 July 2002 by observing thus: "Leave granted. Heard parties. The High Court has dismissed the writ petition merely on the ground that there was delay and laches. In our view, the delay, if any, was only for a period of six months. It is not such which should result in dismissal in limine. We, therefore, set aside the impugned order and restore the Writ Petition to the file of the High Court. The High Court to dispose of the same on its own merits. It will be open to the parties to urge all contentions available to them in law. The appeal stands disposed of." [Emphasis supplied] 14. Mr. Bhate, learned counsel for respondent no. 8 however submitted that since the Supreme Court had permitted the parties to urge all contentions available to them in law, even the issue of delay and laches was open to consideration by this Court. We are afraid, this is not the correct reading of the order of the Supreme Court dated 4 April 2003. In any case, as observed by the Supreme Court itself, the delay, if any, in the present case was not really of 18 months, as was made out to be, by the respondents, but rather the same was hardly 6 months. After the issuance of the impugned notification dated 7 April 2000, the petitioner once again approached the Authorities with a request that the acquisition be dropped. The petitioner also pointed out several infirmities in the matter of project proposal submitted by respondent no. 8, particularly concerning compliances with various requisitions of the SRA and other Development Authorities. After the issuance of the impugned notification dated 7 April 2000, the petitioner once again approached the Authorities with a request that the acquisition be dropped. The petitioner also pointed out several infirmities in the matter of project proposal submitted by respondent no. 8, particularly concerning compliances with various requisitions of the SRA and other Development Authorities. The petitioner's representations were not favourably considered, however by order dated 12 January 2001, compensation for acquisition of the said property was determined by respondent no. 2 at Rs. 30,960/Further on 25 May 2001, the corrigendum was issued to the notification dated 7 April 2000. As noted earlier, this petition came to be instituted in October 2001. On this basis, even the Supreme Court has observed that the delay, if any, was only for a period of 6 months. Further, at the site no development has taken place. Since all these circumstances are required to be cumulatively considered, clearly there is no merit in the objection based upon delay and laches. 15. In the case of M. Bhaskaran Pillai (supra), the issue involved was quite different. In that case, an executive order which permitted acquired but unused land to be returned to the erstwhile owner was questioned and in that context the Supreme Court held that if land is acquired for public purpose, after the public purpose was achieved, the rest of the land could be used for any other public purpose. In case there is no other public purpose of which land is needed, then instead of disposal by way of sale to the erstwhile owner, the land should be put to public auction and amount fetched in the public auction can be better utilised for the public interest envisaged in the directive principles of the Constitution. On such ground and also upon noting that the executive instructions was not inconsonance with the provision of the Kerala Government Land Assignment Act, 1960, the executive instructions came to be struck down. This is clearly not the issue in the present case, where the petitioner challenges the very acquisition of the said property, on the ground that the same constitutes colourable exercise of power. 16. In the present case, there is no clarity on the aspect whether the possession of the said property has indeed been taken over in pursuance of the impugned notification. 16. In the present case, there is no clarity on the aspect whether the possession of the said property has indeed been taken over in pursuance of the impugned notification. In the affidavit dated 3 April 2002, filed on behalf of respondent Nos. 2 and 3, there is no categorical assertions that possession of the said property has been taken over. Admittedly, there is no development carried out at the site. In Balwant N. Bhagde v. M.D. Bhagwat (1976) 1 SCC 700 , the Supreme Court, in this context observed as follows: "We think it is enough to state that when the Government proceeds to take possession of the land acquired by it under the Land Acquisition Act, 1894, it must take actual possession of the land, since all interests in the land are sought to be acquired by it. There can be no question of taking 'symbolical' possession in the sense understood by judicial decisions under the Code of Civil Procedure. Nor would possession merely on paper be enough. What the Act contemplates as a necessary condition of vesting of the land in the Government is the taking of actual possession of the land. How such possession may be taken would depend on the nature of the land. Such possession would have to be taken as the nature of the land admits of. There can be no hard and fast rule laying down what act would be sufficient to constitute taking of possession of land." 17. There is material on record which establishes that although the entire said property admeasures about 4780 sq. meters, hardly an area of 839.6 sq. meters could be said to have been affected by slums. The specific pleadings of the petitioner in this regard have not been controverted with specific denials. That apart, the Additional Collector (Encroachment) - respondent no. 2, in the Annexure II issued on 2 January 2001 has expressly stated that the said property had total of 42 structures in the slum area, out of which 27 structures were censused or protected structures. The area under the slums was 839.6 sq. meters and the slum plan appended to Annexure II indicates that the slums were concentrated mostly in survey no. 725(part). If this be so, then the State and its Authorities, were duty bound to consider whether the acquisition of the entire said property admeasuring 4780 sq. The area under the slums was 839.6 sq. meters and the slum plan appended to Annexure II indicates that the slums were concentrated mostly in survey no. 725(part). If this be so, then the State and its Authorities, were duty bound to consider whether the acquisition of the entire said property admeasuring 4780 sq. meters, was at all necessary for the implementation of slum rehabilitation scheme. This was a vital and relevant consideration, which appears to have been overlooked in issuing the impugned notifications. Non consideration of such vital and relevant material, apart from constituting non application of mind, also amounts to unreasonableness. Besides, insistence of acquisition of the entire said property admeasuring 4780 sq. meters, when in fact the area occupied by the slum was restricted to hardly 839.6 sq. meters lends credence to the petitioner's consistent contention that such acquisition proceedings were at the behest of respondent no. 8 - a builder, who for its private interest, had already made a claim for development rights in respect of the entire said property, but had failed to obtain any reliefs from the courts, in that regard. 18. There is material on record which establishes that the acquisition proceedings were initiated on the basis of application dated 24 January 1997 made by respondent no. 8 - builder. This is reflected in the Collector's report to the State Government proposing acquisition of an area of 1843.1 sq. meters. The relevant portion of the report, reads thus: "Shri Haribhai Ahir, Proprietor Hari Estate has requested through application dated 24/1/1997 to get acquired the above mentioned property under M.S.A. Act, 071 clause 14(1)." 19. The aforesaid report of the Collector had recommended acquisition in respect of an area 1843.1 sq. meters, obviously on the basis of site inspection and analysis of the requirements to undertake a slum redevelopment scheme, which had hardly about 42 huts / slums upon it and which was restricted to area of 839.6 sq. meters. Notwithstanding the Collector's recommendation, the Authorities have chosen to acquire the entire said property admeasuring 4780 sq. meters, which corresponds to the claim of respondent no. 8. There is no explanation in the returns filed on behalf of the State as to why the entire said property admeasuring 4780 sq. meters was being acquired, despite the Collector's recommendation for acquisition area of 1843.1 sq. meters. meters, which corresponds to the claim of respondent no. 8. There is no explanation in the returns filed on behalf of the State as to why the entire said property admeasuring 4780 sq. meters was being acquired, despite the Collector's recommendation for acquisition area of 1843.1 sq. meters. In the absence of any explanation, the only inference that can be drawn is that the entire acquisition proceedings were at the behest of respondent no. 8, who claimed entitlement to develop the entire said property but was unsuccessful in obtaining any court orders against the petitioner with regard to such claim. 20. The material on record establishes very clearly the civil disputes as between the petitioner and respondent no. 8, in the matter of development of the said property. Whilst respondent no. 8 claimed to have agreement with the petitioner for the development of the entire said property, the petitioner had denied the existence of any such agreement. Respondent no. 8, accordingly instituted suit no. 466 of 1995 claiming entitlement to develop the entire said property. Interim relief was declined by learned Single Judge on 13 February 1997 and the appeal against the same was dismissed on 22 September 1997. Soon thereafter, respondent no. 8, which was instrumental in initiating acquisition proceedings, ensured that the proceedings gain momentum and result in acquisition of the said property. If all such circumstances are cumulatively considered, then it is reasonable to infer that the acquisition proceedings were at the behest of respondent no. 8 and for the promotion of the private interest of respondent no. 8. Resort to the provisions of Section 14(1) of the Slum Act, in such circumstances, constitutes a colourable exercise of power. 21. After the said property was declared as a slum area under Section 4 of the Slum Act, on 29 September 1993, the Authorities under the Slum Act issued notices to the petitioner to undertake environmental improvement works in respect of the said property, which included provisions for W.C., water connection, internal roads, lights, sewerage and drainage. By communication dated 13 April 1994, the petitioner placed on record that such works were carried out and the directions as contained in the notice dated 11 February 1994, were complied with. Thereafter, the Authorities under the Slum Act issued notices for purpose of inspection and survey. By communication dated 13 April 1994, the petitioner placed on record that such works were carried out and the directions as contained in the notice dated 11 February 1994, were complied with. Thereafter, the Authorities under the Slum Act issued notices for purpose of inspection and survey. However, it is not at all clear whether such inspection was indeed carried out, with a view to ascertain the compliances. Considering the circumstance, that the slum structures were only 42 in number and restricted to an area of 839.6 sq. meters, site inspection and verification could easily have been carried out by the Authorities. If there was any deficiency, then it was always open to the Authorities to insist upon and ensure compliances. However, it appears nothing of this sort was done. Instead, at the behest of respondent no. 8, who was interested in development of the entire said property, proceedings were initiated for the acquisition of the entire said property. 22. In response to the show cause notice, the petitioner had pointed out that it was itself willing to develop the said property. On that basis the petitioner has also challenged the acquisition as per the contention set out in para 6(C) above. However, we do not propose to go into the issue whether the offer of option to the property owner is an essential precondition for the exercise of powers under Section 14(1) of the Slum Act. In the peculiar facts and circumstances of this case, it is not necessary to decide this contention, because the acquisition proceedings in the present case, commenced on the basis of application dated 24 January 1997 made by respondent no. 8 - builder, who had instituted civil suit no. 466 of 1995 claiming entitlement of development regards the said entire property. This is the reason, which vitiates the acquisition proceedings being colourable exercise of power. 23. Normally, events subsequent to the acquisition proceedings may not be relevant for the purposes of determining whether the very initiation of acquisition proceedings was legally infirm or not. But in the present case, such circumstances assume relevance, because we are satisfied from the material on record that the present acquisition proceedings were at the behest of respondent no. 8 and for the purpose of promoting his personal interest. After completion of the acquisition proceedings, the SRA by letter dated 18 April 2001 called upon respondent no. But in the present case, such circumstances assume relevance, because we are satisfied from the material on record that the present acquisition proceedings were at the behest of respondent no. 8 and for the purpose of promoting his personal interest. After completion of the acquisition proceedings, the SRA by letter dated 18 April 2001 called upon respondent no. 8 to comply with the following: 1. Certification of Annexure II; 2. Submission of layout plan as contemplated by DCR 33(10); 3. Submission of D.P. Remarks; 4. Submission of agreement between petitioner and respondent no. 8; 5. Submission of NOC from Civil Aviation Authorities. 24. At least by 28 February 2002, respondent no. 8 had not complied with the requisitions contained in SRA's letter dated 18 April 2001. Therefore, by letter dated 28 February 2002, SRA called upon respondent no. 8 to comply with the requisitions within 15 days, failing which the proposal of respondent no. 8 for development of the said property would be recorded. There is no material produced on record by respondent no. 8 to establish that the requisitions were indeed complied with by it. 25. In the aforesaid context, the affidavit made by the Chief Promoter of respondent no. 9 i.e. the association representing the slum dwellers on 2 February 2014 assumes importance. In this affidavit, the Chief Promoter of respondent no. 9 has stated that there is no subsisting agreement between themselves and respondent no. 8. Respondent no. 8, had approached respondent no. 9 and the individual slum dwellers, with a proposal that it would develop the said property expeditiously and that respondent no. 9 and individual slum dwellers ought not to give their individual consents to the petitioner. Ultimately, respondent no. 8 reneged upon its commitments and further failed even to comply with the requisitions of the SRA, as contained in its letter dated 18 April 2001 due to which the proposal of respondent no. 8 for redevelopment had been recorded. As a result of such misleading and incapacity on the part of respondent no. 8, the project has been hampered for over 10 years. In such circumstances, respondent no. 9 has lost confidence in respondent no. 8 and it is agreeable to the petitioner implementing the scheme under DCR 33 (10). 26. 8 for redevelopment had been recorded. As a result of such misleading and incapacity on the part of respondent no. 8, the project has been hampered for over 10 years. In such circumstances, respondent no. 9 has lost confidence in respondent no. 8 and it is agreeable to the petitioner implementing the scheme under DCR 33 (10). 26. The aforesaid subsequent developments also establish that the acquisition proceedings were essentially at the behest of and for the promotion of private interest of respondent no. 8. There was no public purpose as such involved in the entire exercise. In any case, the Authorities under the Slum Act, prior to exercise of powers under Section 14(1) failed to advert to vital and relevant considerations. Instead they permitted themselves to be swayed by irrelevant considerations. In such circumstances, the impugned acquisition proceedings stand vitiated and are liable to be struck down. 27. In Bhalchandra Datey vs. State of Maharashtra - 2012(2) Mh.L.J. 543 , acquisition of property by resort to the provisions contained in Chapter VIII-A of the Maharashtra Housing and Area Development Act, 1977 for the benefit of tenants, was struck down in the light of stand taken by the tenants that the property could be redeveloped according to the agreement reached between the tenants and the owners of the property. The contention on behalf of the State that once the land is acquired and possession is taken, the Government does not have the power to withdraw from acquisition or delete the acquired land from acquisition, by relying upon the decision in M. Bhaskaran Pillai (supra) was rejected by holding that the decision does not prevent the Court from setting aside the acquisition of property if it finds that the purpose for which the property was acquired will itself not be served or when the Court finds that the property was being acquired for the benefit of tenants, who are no longer interested in such acquisition and would prefer development based upon agreement between themselves and the property owner. Thus, consideration that the tenants no longer desire to form a cooperative society and avail benefits of acquisition, but rather, were interested in development of the property on the basis of agreement with the property owner, was regarded as a relevant consideration, to interfere with the acquisition. 28. The precedents, upon which Mr. Thus, consideration that the tenants no longer desire to form a cooperative society and avail benefits of acquisition, but rather, were interested in development of the property on the basis of agreement with the property owner, was regarded as a relevant consideration, to interfere with the acquisition. 28. The precedents, upon which Mr. Mattos, learned Government Pleader placed reliance upon, concern mainly the constitutional validity of Section 14(1) of the Slum Act and the powers vested in the State Government to acquire land to execute any work of improvement or to redevelop in slum area. In the light of such precedents, obviously the petitioner cannot require us to revisit the issue of constitutionality. So also, there is no dispute with regard to the powers vested in the State Government in matters of acquisition under Section 14(1) of the Slum Act. However, it is trite that all power is a trust and therefore, all powers have to be exercised in good faith and for the end designed. In the present case, the material on record suggests that power of acquisition under Section 14(1) of the Slum Act was resorted to, not genuinely to execute any works of improvement or to redevelop any slum area, but rather to promote the private interest of respondent No. 8, who had made a claim in respect of development of the entire said property. In such circumstances, it has to be held that the action of the State Government was not bonafide and was vitiated by obvious malice. 29. There is difference between malice in fact and malice in law or legal malice. The expression legal malice means and implies that the action of the State is not in good faith and for the purposes of the Act. The action, in the present case, does not appear to be aimed at execution of any works of improvement or development of slum area per se, but rather to enable respondent no. 8 to develop the said property for commercial gains, notwithstanding the civil courts finding no prima facie merit in respondent no. 8's claim, against the petitioner for the development of the said property. When malice is attributed to the State, it may not be a case of personal ill will or spite on the part of the State. Suffice that power is exercised for some collateral or oblique purpose. 8's claim, against the petitioner for the development of the said property. When malice is attributed to the State, it may not be a case of personal ill will or spite on the part of the State. Suffice that power is exercised for some collateral or oblique purpose. Suffice that the Authorities who are the custodians of power are influenced in its exercise by considerations other than that for which the power is vested in them, in the first place. Suffice that in the exercise of power, the Authority is swayed by extraneous considerations, quite irrelevant to the entrustment. Suffice, if the exercise of power is designed to the attainment of ends beyond the sanctioned purposes of power by simulation or pretension of gaining a legitimate goal. 30. The Supreme Court in State of Punjab and Anr. vs. Gurdial Singh and Ors. (1980) 2 SCC 471 , explained the concept of 'legal malice' in the context of acquisition of property, in the following eloquent terms. "The question, then, is what is mala fides in the jurisprudence of power? Legal malice is gibberish unless juristic clarity keeps it separate from the popular concept of personal vice. Pithily put, bad faith which invalidates the exercise of power-sometimes called colourable exercise or fraud on power and oftentimes 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 fulfillment of a legitimate object the actuation or catalysation by malice is not regicidal. 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 must exist". Fraud on power voids the order if it is not exercised bona fide for the end designed. Fraud on power voids the order if it is not exercised bona fide for the end designed. Fraud in this context is not equal to moral turpitude and embraces all cases in which the action impugned is to effect some object which is beyond the purpose and intent of the power, whether this be malice-laden or even benign. If the purpose is corrupt the resultant act is bad. If considerations, foreign to the scope of the power or extraneous to the statute, enter the verdict or impel the action, mala fides or fraud on power, vitiates the acquisition or other official act." 31. When considered from the aforesaid perspective, we are satisfied that acquisition of said property by resort to the provisions of Section 14(1)of the Slum Act was vitiated by legal malice and colourable exercise of power. Several vital considerations like the extent of the slum area, in comparison to the total area of the said property, pendency of civil disputes between the petitioner and respondent no. 8 - builder, reported compliances of environmental improvement works claimed to have been carried out by the petitioner, the recommendations of the Collector and so on, have been ignored. Instead, the State and its Authorities have permitted their subjective satisfaction to be deflected by irrelevancies and extraneous considerations. The entire acquisition proceedings were engineered by respondent no. 8 - builder, after being unsuccessful in obtaining orders from the civil court, in the matter of enforcement of any alleged contracts for development of the said property with the petitioner. Finally, even respondent no. 9, which is an association of slum dwellers, for whose apparent benefit the acquisition of the said property was initiated, has itself admitted that the acquisition was in fact at the behest of respondent no. 8 - builder and that respondent no. 9 and its members have lost confidence in respondent no. 8 - builder. No useful purpose will therefore be served, by upholding such acquisition. The acquisition, is consequently legally infirm and deserves to be struck down. 32. We make it clear that we are not deciding the petitioner's contention at paragraph 6(C), as in our judgment, the present petition can be disposed of by adverting to the other contentions raised by and on behalf of petitioner. 33. In the result, the impugned notification dated 7 April 2000 and corrigendum dated 25 May 2001 is hereby set aside. We make it clear that we are not deciding the petitioner's contention at paragraph 6(C), as in our judgment, the present petition can be disposed of by adverting to the other contentions raised by and on behalf of petitioner. 33. In the result, the impugned notification dated 7 April 2000 and corrigendum dated 25 May 2001 is hereby set aside. Since the notice dated 12 January 2001 is consequential to the impugned notification dated 7 April 2000, needless to state that the same also falls and in any case the same is also set aside. 34. There is some dispute whether the possession of the said property has been taken over by the State, in pursuance of the acquisition proceedings. In the event this has been done, then the State shall restore the possession of the said property to the petitioner. 34. In response to a query from the Court whether possession of the said property has been taken over by the State in pursuance of the acquisition proceedings, Mr. Mattos, learned AGP states under instructions that possession of the said property has not been taken over by the respondent-authorities. 35. The learned AGP further prays for stay of the operation of this order for some time, so also the learned counsel for respondent No. 9 also makes a similar prayer. 36. In the facts and circumstances of the case, operation of this judgment and order is stayed for a period of eight weeks, that is upto 25 November 2014. Thereafter all the State authorities including the Sub-Registrar of Assurances, Mumbai shall take the necessary actions in order to comply with the directions in this judgment within two weeks thereafter. 37. Rule is accordingly made absolute to the extent indicated above. In the facts and circumstances of this case, there shall be no order as to costs. Disposed off.