Joy Ice Cream land case: Relief to Prestige Estate Projects

A division bench of the High Court has upheld the order passed by a single bench pertaining to 3.23 acres of land at Pattandur Agrahara in Krishnarajapura Hobli in Bengaluru in favour of Prestige Estate Projects Limited.

A division bench headed by acting Chief Justice Alok Aradhe said that condition with regard to non-alienation of the land under Karnataka Land Grant Rules does not apply in case the land is allotted to Karnataka Industrial Areas Development Board (KIADB).

Joy Ice Creams Private Limited was the owner of the land running an ice cream manufacturing factory. KIADB declared it as an industrial area in 1989.

The land in question was leased out in favour of Joy Ice Creams in 1989. Subsequently, on the request of Joy Ice Creams, a process was initiated to execute the sale deed. On March 31, 2006, the Special Deputy Commissioner by a memorandum imposed a condition of
non-alienation and transferred the land to KIADB.

On July 21, 2007, KIADB registered the sale deed in favour of Joy Ice Creams for Rs 5.30 crore. On August 30, 2006, Joy Ice Creams sold the land to Prestige Estates Projects.

On May 22, 2015, the Deputy Commissioner by an order dated May 23, 2015, had cancelled the grant in favour of Joy Ice Creams on the ground of violation of grant rules. The single judge bench had said that it was not just and reasonable for the state government to pass an order annulling all the transactions, including the sale deeds executed.

The state government and the NGO Samaj Parivartana Samudaya (SPS) challenged the single-bench order. The division bench said that the land has been allotted to KIADB with the prior approval of the state government and hence the contention that the grant has been made in contravention of rule 20 (1) (c) of the KIADB rules does not deserve acceptance.

“It is evident that the condition with regard to non-alienation of the land does not apply in case the land is allotted to KIADB.

“In the instant case, the land was handed over by the Government of Karnataka to KIADB. Therefore, in view of proviso to Rule 28 (2) of the Rules, the condition with regard to non-alienation of the land was not rightly imposed by the GOK, which otherwise could not have been imposed by Deputy Commissioner in the memo dated 31.03.2006,” the bench said.