HC bins govt order cancelling land allotment to Joy Ice Cream

KIADB had given land to Joy which sold it to Prestige

The High Court of Karnataka on Friday quashed the government order which had cancelled the allotment of land to Joy Ice Cream Pvt Ltd by Karnataka Industrial Areas Development Board (KIADB) at Patanduru Agrahara village near Whitefield in Bengaluru.

The KIADB had allotted 3.23 acres to Joy Ice Cream Pvt Ltd which in turn sold it to Prestige Estates Projects Limited, which constructed a residential complex on the said land.

Bengaluru Urban Deputy Commissioner and the state government had cancelled the allotment of land as the conditions of grant relating to non-alienation (non-transferable) of the land was violated.

Justice B S Patil while allowing the petition filed by Prestige said that once it is held that the conditions imposed by the DC, while issuing official memorandum itself were not in accordance with the law and were not authorised by the state government. The government order of cancellation or the withdrawal of the land already granted “suffers from serious illegality even of jurisdiction and hence, the order is unsustainable.”

The judge in the order said when prior permission granted by the state government did not require imposition of conditions with regard to non-alienation of the land, the deputy commissioner cannot impose such conditions later on. With regard to the government’s argument of fraud being committed by the grantees, the court said, “the allegations of fraud made are unfounded.” The judge said action taken by Bangalore Development Authority, KIADB, deputy commissioner and the state government earlier was illegal and required to be corrected.

“This only shows that the state government has traversed the scope of the inquiry before it and has ignored the right of the third party.”
Prestige has invested huge amount of money in the project. Several innocent third parties have already invested in the flat construction.

Materials are placed on record to show the nature of investment and improvement made over the projects. Therefore, it was neither just nor reasonable for the state government to pass such an order annulling all the transactions including the sale deed executed in favour of Prestige, the order said.