1

AFR RESERVED
Court No. - 32
Case :- WRIT - C No. - 49810 of 2007

Petitioner :- Dr. Ashok Tahiliani

Respondent :- State Of U.P. And Others
Counsel for Petitioner :- Rahul Sripat, Anurag Khanna, Rahul Agarwal
Counsel for Respondent :- C.S.C.

Hon'ble Shashi Kant Gupta,J.

Hon'ble Pankaj Bhatia,J.
(Per: Hon'ble Pankaj Bhatia,J.)

The present petition has been filed by the petitioner seeking the
following reliefs:

“a. a writ of certiorari to quash the order dated

25.8.2006 passed by respondent no. 1 (Annexure-IX
to the writ petition)

b. writ, order or direction in the nature of mandamus

directing the respondents grant free hold rights to the
petitioner on his application filed on 30.1.1999 for
Nazul Plot No. 2(A-10) Civil Station, Allahabad
bearing municipal no. 22, Hastings Road (Nyay
Marg), Allahabad in terms of the government order
dated 1.12.1998 accepting the agreement to sell
dated 8.3.1972 executed in favour of the late father of
petitioner.”

The facts leading to the filing of the present petition in brief are that
an agreement to sell was executed in favour of Dr. Nandlal Tahiliani on
08.03.1972 along with delivery of possession by the erstwhile lessee for a
consideration. The agreement to sell was in respect of Premise No. 22,
Hastings Road, Allahabad with all these hold rights and the rights
attached to the land in building. The said agreement was an unregistered
agreement. It is stated that in pursuance of the said agreement to sell the
father of the petitioner and, after his death, the petitioner is in actual
 2

physical and legal possession in property in question.

It is stated that the property is constructed on Nazul land being Plot

No. 2(A-10) Civil Station, Allahabad. One of the stipulation, in the
original lease deed, was that no part of the land can be transferred/sold
except with the approval of the State Government, the lessor. It is also
stated that on account of the said stipulation Dr. Nandlal Tahiliani
approached the State Government for grant of necessary permission for
transfer of title in his name vide an application dated 20.1.1973. No
decision was taken by the State Government on the said application and,
during the pendency of the said application, Dr. Nandlal Tahiliani died on
6.8.1991 leaving behind his son Dr. Ashok Tahiliani, the present petitioner
as his legal heir. It is stated that the State Government took decision to
convert the lease hold rights pertaining to the Nazul land in the State of
Uttar Pradesh into free hold and various Government Orders have been
issued from time to time for the said purpose. (which we shall discuss in
the latter part of the judgement). The petitioner being desirous of getting
free hold rights in his favour applied for grant of free hold rights on
30.1.1999 for a total area admeasuring 5856.53 square meters. The said
application is on record as Annexure-6 to the writ petition. The petitioner
states that no decision was taken by the District Magistrate, however, after
about four years, the District Magistrate sought necessary directions from
the State Government vide his letter dated 16.7.2003 which was followed
by a reminder on 14.6.2005 on which the State Government passed an
order dated 25.8.2006 which is impugned in the present writ petition. The
State Government, vide the said order dated 25.8.2006 (Annexure-9 to the
writ petition) rejected the request for grant of free hold rights on the
ground that the agreement in favour of the predecessor in interest of the
petitioner is not a registered agreement to sell and in the opinion of the
DGC (Civil) no steps can be taken for conversion of rights into free hold
rights and that in the agreement to sell executed in favour of the
predecessor in interest of the petitioner there appears to be no right of
 3

renewal in favour of the predecessor. The petitioner has thus approached

this Court seeking the quashing of the order dated 25.8.2006 with further
directions to the State Government to grant free hold rights in respect of
the land as was requested by the petitioner.

We have heard Sri Rahul Sripat, Senior Advocate, assisted by Sri

Ishir Sripat as well as Sri Prashant Tahiliani and Ms. Kritika Singh,
learned Additional Chief Standing Counsel and Sri Nagendra Kumar,
learned Standing Counsel for the State.

Sri Rahul Sripat has argued that both the grounds which are the
basis for passing the order dated 25.8.2006 are wholly arbitrary and illegal
inasmuch as all the rights were duly transferred in the agreement to sell
executed in favour of the predecessor in interest of the petitioner. He
further argued that this Hon'ble Court in the case of P.D. Tandon vs.
State of Uttar Pradesh, AIR 1986 56 has already held that the State
Government is bound to renew the lease and the lessee in occupation shall
continue as tenant holding over after the expiry of lease. He has further
argued that the observation of the State Government in the order dated
25.8.2006 that free hold rights cannot be granted in favour of petitioner as
the agreement to sell is an unregistered agreement is fallacious as the
requirement of compulsory registration was incorporated in Section 17 of
the Registration Act which came into effect from 01.01.1977 in the State
of Uttar Pradesh. He argues that the agreement to sell in favour of
predecessor interest was executed on 8.3.1972 which was much prior to
the amendment of Section 17 of the Registration Act with effect from
01.01.1977, as such the benefits cannot be denied merely on the ground
that the agreement to sell was not a registered one. He has further argued
that from time to time various Government Orders have been issued
laying down the policy of the State Government for conversion of lease
hold rights into free hold rights and the State Government extended the
benefit of conversion even in favour of unauthorised occupants as such
denying the benefit of free hold rights merely on the ground that the
 4

agreement to sell is not a registered one is wholly arbitrary, illegal and

violative of the rights enshrined under Part III of the Constitution of India.

Sri Rahul Sripat has also drawn our attention to an additional fact.
In a Testamentary Suit No. 12 of 1982 and Testamentary Case No. 9-10 of
1981, the heirs of the initial lessee, who had executed the agreement to
sell dated 8.3.1972, had challenged the said agreement and, in the said
proceedings, the validity of the agreement to sell in favour of the
predecessor in interest of the petitioner was upheld in the judgement dated
13.9.1983 passed in the aforesaid suits. The judgement dated 13.9.1983
was further upheld in the Special Appeal No. 15 of 1983 filed challenging
the judgement dated 13.9.1983. The judgement of the special appeal dated
10.11.1986 has also been filed as Annexure-3 in the writ petition.

Sri Rahul Sripat, learned counsel for the petitioner, thus, submits
that there is no dispute pertaining to the agreement to sell in favour of Dr.
Nandlal Tahiliani or the possession of the land in question.

The writ petition was filed in the year 2007, however, the State
Government did not file a reply for a period of twelve years.

This Court, vide order dated 1.5.2019, called for an explanation

from the State Government as to why a counter affidavit had not been
filed for a period of 12 years and granted a final opportunity to file a
counter affidavit.

In pursuance of the said direction, a counter affidavit has been filed

by the Additional District Magistrate (Nazul) wherein they accepted the
factum of agreement to sell dated 8.3.1972 pertaining to the Plot No. 2(A-
10) Civil Station, Allahabad and also that the High Court had accepted
the physical possession of the petitioner, however, the State Government
justified the order dated 25.8.2006 mainly on the ground that the
agreement to sell was not registered.

From the pleadings exchanged in between the petitioner and

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respondents, the following points emerge for determination by this Court:

(i) Whether the petitioner is entitled to conversion of his lease

hold rights into free hold rights on the basis of an an unregistered
agreement to sell in his favour executed on 8.3.1972 in
consonance with various Government Orders issued from time to
time by the State Government.

(ii) Whether the petitioner is entitled for conversion of his lease

hold rights into free hold rights in terms of the Government Order
dated 1.12.1998 and, if so, at what charges.

Sri Rahul Sripat, learned counsel for the petitioner, has placed
before us the various Government Orders pertaining to the conversion of
lease hold rights into free hold rights in the State of Uttar Pradesh.

For the first time, the State Government issued a Government Order
on 2.12.1992 which provide for conversion of lease hold rights into free
hold rights in respect of Nazul lands in favour of the lessees. The lessees
were divided into three groups as follows and also prescribed the rates on
which the conversion can be applied:

d&,sls iV~Vk/kkjd ftUgksus yht [k&,sls iV~Vk/kkjd ftUgksus yht

dh 'krksZ dhk mYya/ku ugh dh 'krksZ dhk mYya/ku fd;k
fd;k gSA gSA
,dy fuoklh ‘Hkou 50 izfr’kr 100 izfr’kr
gsrq fu/kkZfjr lfdZy 75 izfr’kr 125 izfr’kr
jsV dh xzqi gkmflax 150 izfr’kr 250 izfr’kr
O;olkf;d mi;ksx

The said Government Order dated 2.12.1992 was in pursuance of

the policy of the State Government as outlined in the Government Order
dated 23.5.1992 providing for conversion of lease hold rights into free
hold rights for the benefit of the lessees of the Nazul lands. In the said
policy, it was provided for that people who are in unauthorised possession
would not be entitled to avail the benefit of conversion in their favour.
 6

The said policy continued upto 19.11.1998 on which date the State
Government clarified about the applicability of the rates with respect to
the applicants who had applied for conversion upto 18.8.1997. It is
relevant to state that vide Government Order dated 29.8.1996 the State
Government had provided for conversion of lease hold rights into free
hold rights in favour of the purchasers/agreement holders who had
purchased the property from the lessee by a registered agreement. The
State Government thereafter issued a Government Order dated 1.12.1998
providing for a simplified procedure for conversion of lease hold rights
into free hold rights. The said Government Order provided that an
application shall be accompanied by 25% deposit on self-assessment basis
and the conversion shall take place in accordance with other details
provided in the said Government Order dated 1.12.1998. The said order
dated 1.12.1998 also provided for free hold in favour of unauthorised
occupants. The provision with regard to unauthorised occupants are
quoted here-in-below:

^^’kklu ds laKku esa ,sls izdj.k Hkh vk, gSa ftues utwy Hkwfe dks vukf/kd`r :i ls
dqN O;fDr;ksa@ laLFkkvksa }kjk iathd`r foØ; i= }kjk fdlh vU; O;fDr dks foØ;
dj fn;k gSA bldk vFkZ ;g gqvk fd vukf/kd`r dCtsnkj }kjk iathd`r foØ; ds
ek/;e ls Hkwfe dk ewY; nsdj Hkwfe dks Ø; fd;k gS vkSj foØsrk ekSds ij dCtsnkj ugha
gSA vr% ,sls Øsrkvksa ds i{k esa mUgsa voS/k dCtsnkj ekurs gq, Ýh gksYM dh dk;Zokgh
dh tkrh gS rks mUgsa mlh Hkwfe dk nqckjk ewY; nsuk iM+sxkA ,sls izdj.k mu voS/k
dCtsnkjks ds izdj.k ls fHkUu gS ftUgksusa utwy Hkwfe ij fcuk dksbZ ewY; fn, voS/k
dCtk lh/ks fd;k gSA vr% ,sls izdj.kks esa ftuesa utwy Hkwfe fdl iV~Vsnkj ls fHkUu
O;fDr@ laLFkk ls iathd`r foØ; i= ds ek/;e ls ftuds }kjk izkIr dh xbZ gS muds
i{k esa Ýh gksYM djrs le; fj;k;r nh tk;A 101 oxZ ehVj ls 150 oxZ ehVj rd
utwy Hkwfe ds voS/k dCtsnkjksa ds fy;s ;g fj;k;r fu/kkZfjr Ýh gksYM ewY; dk 50
izfr’kr j[kk tkuk mfpr gksxk D;ksafd ,sls voS/k dCtsnkj iwoZ esa mldk ewY; ,d ckj
vnk dj pqds gSA vFkkZr vkoklh; iz;ksx ds fy, 120 izfr’kr ds LFkku ij v|ru
lfdZy jsV dk 60 izfr’kr ,o O;olkf;d iz;ksx ds fy, 200 izfr’kr ds LFkku ij
100 izfr’kr orZeku lfdZy jsV ds ewY; ij Ýh gksYM fd;k tk,A fdUrq 151 oxZ
 7

ehVj ls 200 oxZ ehVj rd voS/k dCtsnkjksa ds }kjk ;g nj vkoklh; ekeyksa esa v|
ru lfdZy jsV ds 90 izfr’kr rFkk O;olkf;d ekeyksa esa 150 izfr’kr dh nj ls ewY;
ns; gksxhA bl gsrq jftLVMZ cSukek }kjk Hkwfe Ø; djus dh dV vkWQ MsV 1-1-92 gSA
bl frfFk ds ckn ls voS/k dCtsnkjks ds fo:) csn[kyh dh dk;Zokgh dh tk, vkSj
fdlh Hkh n’kk esa Ýh gksYM ugha fd;k tk,xkA 'kklukns’k tkjh gksus ds fnukad ls 2
ekg dh vof/k rd gh mijksDruqlkj Ýh gksYM djkus dh NwV jgsxhA**

The petitioner had applied for conversion of his lease hold rights in
pursuance of this Government Order dated 1.12.1998.

Sri Rahul Sripat, learned counsel for the petitioner, has drawn our
attention to the subsequent Government Order dated 10.12.2002 wherein
certain conditions were changed. The relevant paragraph with regard to
unauthorised documents is as under:

^^5- 'kklukns’k la[;k 2268@9&vk&4&98&704,u@97 fnukad 1 fnlEcj] 1998 ds

izLrj&7 esa fnukad 1-1-1992 ds iwoZ ds voS/k dCtks dks fofu;fer fd;s tkus ds lEcU/k esa
njs fu/kkZfjr dh x;h gSA iz’uxr ekeyksa esa uhfr dk ljyhdj.k djrs gq, vc fnukad
1-12-1998 rd ds voS/k dCtks dks orZeku lfdZy jsV ds 100 izfr’kr dh nj ij
Ýh&gksYM fd;k tk;sxk rFkk fnukad 1-12-1998 ds iwoZ ds voS/k dCts ds izek.k Li:i
Hkw[k.M ls lEcfU/kr VsyhQksu fcy] fo|qr fcy gkml VSDl dh jlhn ernkrk lwph]
jk’ku dkMZ ds vfrfjDr cSd ds [kkrs esa fn;k x;k irk Hkh vfHkys[kh; lk{; tkuk
tk;sxkA**

Various Government Orders have been issued thereafter from time

to time pertaining to the decisions taken by the State Government with
regard to the conversion of lease hold rights into free hold rights.

On 04.08.2006, the State Government took a policy decision not to

allow the conversion of lease hold rights into free hold rights for
unauthorised occupants of Nazul lands. Thus, from 1.12.1998 upto
4.8.2006, the State Government permitted the conversion of lease hold
rights into free hold rights even to unauthorised occupants of land and
land grabbers. The subsequent Government Orders have been brought on
record by Sri Rahul Sripat, however, they are not being reverted to in the
 8

present case.

Sri Rahul Sripat has drawn our attention to the Government Orders
extracted above and submits that on the one hand the State Government is
refusing to convert the lease hold rights into free hold rights as prayed by
the petitioner on a technical ground that the agreement to sell was not
registered on the other hand as per the own policy of the State
Government even the possession of unauthorised occupants is being
legitimised by converting free hold rights in their favour, this according to
the counsel for the petitioner, smacks of arbitrariness and thus the stand
taken by the State Government against the petitioner is violative of his
rights enshrined under Articles 14 and 21 of the Constitution of India. He
further submits that the reasoning given by the State Government that the
rights cannot be converted only because the petitioner holds an an
unregistered agreement to sell whereas the State Government is ready and
willing to convert the rights in favour of the unauthorised documents
makes the order wholly arbitrary, illegal and the impugned order can be
said to be suffering from 'Wednesbury arbitrariness'. He further submits
that prior to 1.1.1977 the agreement to sell were not required to be
registered under law and thus the rights flowing from such an agreement
cannot be curtailed only by a Government Order. He submits in terms of
the an unregistered agreement to sell which has been duly upheld and
accepted in the testamentary case and the rights that flow from the
agreement cannot be denied the benefit only on account of a subsequent
amendment made in the Registration Act with effect from 1.1.1977 which
has no retrospective effect. He states that an unregistered agreement to
sell prior to 1977 has to be treated at par with the registered agreement to
sell after 1.1.1977 as both are in accordance with law that prevailed on the
date of the execution of the agreement. He further argues that the intent of
mentioning registered agreement in the Government Order dated
1.12.1998 is only to ascertain the genuineness of the transaction and
cannot be used to deny the benefit that flow from an agreement, as in the
 9

case of the petitioner, from the an unregistered agreement dated 8.3.1972.

He further submits that when the Government Order dated 01.12.1998
was issued only mode prescribed for agreement to sell was through
registered agreement to sell and thus the word 'registered agreement to
sell' was incorporated in the Government Order dated 1.12.1998 and it
cannot be allowed to mean that the State Government wanted to exclude
or deny the benefit of free hold rights to holders of the agreement which is
unregistered but prior to 1.1.1977.

Sri Rahul Sripat has relied upon the judgement of this Court in Writ
– C No. 19608 of 2010 (Sangam Upnivashan Avas Evam Nirman Sahkari
Samiti Ltd. vs. State of U.P. Thru P.S. Housing & Urban Planning & Ors.)
decided on 11.5.2018 wherein this Court observed as under:

“We have considered the submissions raised. The

purpose to grant freehold rights to the erstwhile lease
holders, the unauthorized occupants or to the nominees
of the lessee's or the occupants or sale deed holders
was to promote stability and access to easy availability
of land for housing and commercial purpose, in order
to, speed up development in urban areas and also to
augment the revenue of the State. This also aided in
providing certainty to ownership of land and the
building of a house or a business premises for decent
living and earning a livelihood. This purpose touches
Article 21 of the Constitution of India. The grant of
freehold rights was with a purpose to create rights in
land. The entire process through the Government
Orders that have been placed before us indicates, that
if, a decision is taken to grant a freehold right the same
with the actual grant ends up in the creation of a
vested right which is of course subject to the control of
Article 300-A of the Constitution of India. There is yet
another dimension, namely, that while considering
 10

grant of such rights, the State and its authorities are

bound not to violate the equality Clause of Article 14
and discriminate in matters of such grant between the
same class of applicants. To this extent also, a person
claiming a right of freehold can complain of violation
of Article 14 of the Constitution of India which is a
fundamental right in the event any such Act of hostile
discrimination, or otherwise is complained of. Such
action of the State, therefore has to pass the twin test of
arbitrariness and discrimination. We are mentioning
this as we find that these aspects were not for
consideration and have not been dealt with by the Full
Bench in the case of Anand Kumar Sharma (supra)
that was confined only to the applicability of the
Government Orders. It was held that the policy existing
on the date of consideration would be relevant and not
the date when the application was moved. The Full
Bench also held that this process prior to grant of any
such rights, the same does not amount to a vested or
accrued right to claim freehold rights nor does it gave
rise to any legitimate expectation. The Full Bench,
however did not proceed further and, we therefore, find
that it necessary to indicate that once there is a
decision to grant freehold rights then the element of
discrimination between the same set of applicants and
any arbitrary act would give rise to violation of
fundamental rights guaranteed under Article 14 of the
Constitution of India, the judicial review whereof
would be permissible. This would remove any element
of uncertainty and eliminate possibility of arbitrariness
as and when the occasion arises.”

He next relied upon the judgement in the case of Surendra Kumar

vs. Amarjeet Singh and others, 2004 SCC Online All 506 wherein this
 11

Court had considered the effect of registration of documents pertaining to

the Nazul property from 1.1.1977. In the said case, learned Single Judge
of this Court, had interpreted the amendment of section 49 of the
Registration Act.

The next case relied upon by learned counsel for the petitioner is
Ram Singh and others vs. Sughar Singh, 2010 SCC OnLine All 1728
wherein the this High Court has observed as under:

“Admittedly, at the relevant time when the above

agreement was executed, there was no requirement in
law to get an agreement of sale of any immovable
property registered. The agreement provided for
execution of sale deed within two years subject to
certain other conditions. Subsequently, as it was not
possible to execute the sale deeds within the time so
stipulated, the parties by executing documents dated
30.9.1978 and 29.9.1981 agreed for getting the sale
deed executed latest by 31st October 1984 and at the
time of executing the above two documents a further
sum of Rs.8000/- and Rs.7000/- respectively were paid
to defendant no.1. In all other respects the terms and
conditions of the agreement remained unaltered. The
above documents as such only acknowledges the fact of
receiving further part of the sale consideration and the
consent of the parties to get the sale deed executed
within the extended time. In such a situation the
aforesaid documents are not in the nature of a fresh
agreements so as to constitute substitution of the
original agreement to sell dated 10.10.1976. The
original agreement was not required to be registered
therefore, anything done in furtherance thereof also
does not require any registration irrespective of the fact
that in the meantime with effect from 1.1.77 registration
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of agreement to sell an immovable property worth over

Rs.100/- was made mandatory vide U.P. Act No. 57 of
1976.

The ruling of the Allahabad High Court reported in

AIR 1992 Allahabad 346 Smt. Hamida vs. Smt.
Humper and others cited in this context is not at all
applicable. In the aforesaid case his lordship has only
held that in view of Sections 17 and 49 of the
Registration Act, agreement transferring rights and title
in the immovable property worth over Rs.100/- is
required to be registered compulsorily. This proposition
of law is not being disputed but it is not applicable to
an agreement to sell executed prior to 1.1.77 and also
to the acknowledgments or the extensions of time
granted to execute the sale deed in pursuance of the an
unregistered agreement to sell of the period prior to
1.1.1977.”

Sri Rahul Sripat has also relied upon the judgement of the Supreme
Court in the case of Kunal Kumar Tiwari alias Kunal Kumar vs. State
of Bihar and another, (2018) 16 SCC 74 to impress that the construction
of a statute should be one that would promote the purpose or object
underlying the Act and he thus submits that the intent of the State
Government by issuing Government Orders was to convert the lease hold
rights into free hold rights in favour of the persons who are in legal
occupation of the land based upon the documents which are legal on the
date of its execution.

He has next relied upon the judgement of the Supreme Court in the
case of Union of India and another vs. Pfizer Limited and others,
(2018) 2 SCC 39 to stress that while interpreting statute words can only
be added if the literal interpretation of the Section leads to an absurd
result, he thus submits that the literal interpretation of the Government
 13

Order as was done while passing the impugned order will lead to absurd
results as on the one hand and unauthorised occupants would be entitled
to conversion of his rights and, on the other hand, a person, who has the
valid legal instrument in his favour, is not entitled to the benefits of the
free hold rights. He has also placed before us a Full Judgement of this
Court in Writ C No 41958 of 2008 (Anand Kumar Sharma vs. State of
U.P. Thru Secretary and others), decided on 13.2.2014 wherein a
reference was made before the Full Court pertaining to the rates on which
the free hold rights were to be granted, whether it would be the rates
applicable on the date of application or the date on which the actual free
hold rights are granted.

Learned counsel for the petitioner has relied upon the case on State
of Uttar Pradesh and another vs. Harish Tandon, (2016) 15 SCC 242
to argue that the Apex Court had directed the lease hold rights to be
converted into free hold rights in accordance with Government Order
dated 1.12.1998. The Hon'ble Supreme Court in the said case was dealing
with the issue as to whether the rates mentioned in the Government
Orders i:e based upon the circle rate would prevail or the rates as notified
by the U.P. Avas Evam Vikas Parishad and Development Authorities for
conversion of their land would apply to the Nazul lease. The Hon'ble
Supreme Court held that the Schemes are different and the rates as
prescribed for conversion by U.P. Avas Evam Vikas Parishad and
Development Authorities could not apply for calculating the rates for
conversion which would be governed on rates as specified in the
Government Orders for conversion of leasehold right into freehold right
i:e on the basis of circle rate. However, the Supreme Court transposed the
petitioner to the appropriate point of time and directed the conversion of
his rights on the basis of Government Order dated 1.12.1998. Para 7, 8
and 9 of the judgement are quoted herein below:

“7. The High Court, according to us, had faulted in

taking the view that for a common purpose, namely,
 14

conversion of leasehold right to freehold right there

cannot be two different prescriptions prescribing two
different sets of fees/charges and any such position
would be contrary to Article 14. the basis of the
landholding by the State (nazul land) and the land
vested in the U.P. Avas Evam Vikas Parishad and
Development Authorities being distinct and different,
as noticed above, two different prescriptions
containing two different rates/charges of conversion
would not be opposed to the mandate prescribed by
Article 14.

8. We, therefore, take the view that the High Court was
not correct in direction that the conversion of the
respondent-writ petitioner's leasehold rights to
freehold should be government by the G.O. Of 1995
which admittedly apply to the lease granted by the U.P.
Avas Evam Vikas Parishad and Development
Authorities.

9. Consequently and for the reasons above, we set

aside the orders of the High Court and dismiss the writ
petition filed by the respondent. However, transposing
the case to the appropriate point of time, we direct the
respondent-writ petitioner, if he so chooses, to apply
within a period of 30 days from today for conversion of
leasehold nazul land to freehold. The same be
considered by the State Government in accordance
with the G.O. Dated 1.12.1998.”

On the other hand, the learned Standing Counsel has tried to defend
the impugned order in the writ petition and has contended that no vested
right flows in favour of the petitioner in terms of the an unregistered
agreement to sell dated 8.3.1972 and have relied upon the judgement of
Anand Kumar Sharma vs. State of U.P. Thru Secretary and others,
 15

2014 2 ADJ 742 (FB) wherein this Court has held that mere expectancy
of a future benefit is not vested right. The Standing Counsel has also
argued that the State Government rightly rejected the claim of the
petitioner for grant of free hold rights as the agreement to sell dated
8.3.1972 was unregistered document and no sale deed was executed in
between the parties. The Standing Counsel has further relied upon the
decision of the Hon'ble Supreme Court in the case of Raheja Universal
Limited vs. NRC Limited and others, (2012) 4 SCC 148 to contend that
the Supreme Court has held that the agreement to sell does not of itself
create any interest or charge on the property and another judgement of the
Hon'ble Supreme Court in the case of Meghmala and others vs. G.
Narsimha Reddy and others, (2010) 8 SCC 383 to the same effect that
an agreement to sell does not create any right or title in favour of the
intending purchaser. In the written arguments filed by the Standing
Counsel, it has been reiterated that a registered sale deed was never
executed between the parties and, therefore, the petitioner is not entitled
to seek grant of free hold rights over the property.

Testing the arguments raised by the Standing Counsel that no sale

deed was executed in pursuance of the an unregistered agreement to sell
dated 8.3.1972, we are afraid that it cannot be accepted for the sole reason
that in terms of the initial lease, for execution of a sale deed, consent of
the lessor, that is the State Government was essential and, was applied for
by the predecessor in interest of the petitioner but was never decided by
the State Government even till date and furthermore the non-execution of
a sale deed in terms of the agreement to sell was not the basis for passing
the order impugned in the present writ petition. It is well settled that the
validity of the order has to be seen on the basis of the contents of the order
which cannot be supplanted by additional grounds in the counter affidavit
as was settled in the case of Mohinder Singh Gill and others vs. The
Chief Election Commissioner, New Delhi and others, 1978 (1) SCC
405
 16

Coming to the case relied upon by the Standing Counsel in the case
of Raheja Universal (supra) the question raised before the Supreme
Court was in respect of the jurisdiction BIFR under the Sick Industrial
Companies (Special Provisions) Act, 1985 (hereinafter referred to as the
'SICA') and its overriding effect on Transfer of Property Act. The
Supreme Court held that SICA 1985 was special law and would prevail
over the Transfer of Property Act. The Supreme Court on considering the
provisions of SICA Act and its overriding effect on the Transfer of
Property Act had held that an agreement to sell of itself does not create
interest in land. There is no quarrel with the argument that an agreement
to sell by itself does not create any interest in the immovable property,
however, the right that flow from the covenant cannot be denied to the
holder of the agreement in an arbitrary and illegal manner. It cannot be
said that any interest with regard to the right to seek renewal of lease or
conversion of free hold charges do not flow from such an agreement. We
are afraid that the said judgement has no application to the facts of the
present case as the present case relates to the grant of free hold rights in
pursuance of a policy decision of the State Government framed for the
benefit of lessees of the Nazul leases and the benefit flowing from the said
policy decision can be denied only on the grounds which pass the test of
Article 14.

In view of the submissions, as recorded above, what is to be

decided in the present case is the effect of the word “registered agreement
to sell" used in the Government Order dated 1.12.1998 as it is not in
dispute that holders of registered agreement to sell were entitled to the
benefit of conversion of their leasehold right into free hold right. The
word “registered agreement to sell" has neither been defined in the
Government Order dated 1.12.1998 or the Government Order dated
23.6.1992 as such we take recourse to the provisions of U.P. General
Clauses Act. The said Act is applicable to the provisions of all the Acts,
Rules and Notifications issued by the State of Uttar Pradesh. Section
 17

4(35) defines “Registered” as under:

“Registered”, used with reference to a document, shall

mean registered in [a Part A State of a Part C State]
under the law for the time being in force for the
registration of documents.”

And Section 4(42-B) defines “Statutory instrument” which is as

under:

“Statutory instrument” shall mean any notification,

order, scheme, rule, or bye-laws issued under any
enactment and having the force of law”

A plain reading of the word “Registered” in context of a document

means a document required to be registered under the law for the time
being in force for the registration of documents. It is common ground that
prior to 1.1.1977 an agreement to sell was not required to be registered in
the State of Uttar Pradesh as such the word “registered agreement to sell”
used in the Government Order dated 1.12.1998 has to be read as an
"agreement to sell in accordance with law applicable at the time of the
execution of the said agreement to sell".

We are resorting to the rule of purposive interpretation while

rendering the said finding to the extent that a “registered agreement to
sell "has to be read as "an agreement to sell which is in consonance with
the law when the agreement to sell is executed" for the reason that the
policy of free hold by the State was first notified by means of a
Government Order dated 23.5.1992 which provided for conversion of
leasehold right into free hold right in favour of the lease holders. The
subsequent Government Orders including the Government Order dated
1.12.1998 was in furtherance of the policy as declared in the Government
Order dated 23.5.1992 and thus interpretation of words used has to be
harmonised which lead to furtherance of the intention as declared by
means of a policy document dated 23.5.1992. A perusal of the
 18

Government Order dated 23.5.1992 reveals that the State Government

took a decision to convert the lease hold rights into free hold rights except
in the cases where the land was in unauthorised occupation or which were
subject matter of any litigation in the Court of Law or which were not a
part of the original lease. It was never the intent of the Government to
deny the benefits of conversion into free hold rights in favour of the
authorised document holders in occupation whatever be the manner of
occupation. In fact, the State Government had even authorised the
conversion in favour of the persons who were the unauthorised occupants
and thus the stand of the State Government that it is only the “registered
agreement to sell” holders who would be entitled for conversion will lead
to absurdity. It is equally well settled that the words used in the
Government Orders or the Statutes have to be interpreted in their “legal
sense”. We have already recorded that the word registered has been
defined under the U.P. General Clauses Act to mean that “Registered in
accordance with law prevalent". Thus, taking into account, the law
prevalent in 1972, which did not require the agreement to sell to be
compulsorily registered We have no hesitation in holding that the word
“Registered agreement to sell" used in the Government Order 1.12.1998
would mean "agreement to sell which is in accordance with law as
applicable on the date of its execution".

The impugned order cannot be sustained for another reason that is

that even if the State Government was of the view that the an unregistered
agreement to sell would not entitle the petitioner to get free hold rights,
the petitioner was still entitled for grant of free hold rights as even the
unauthorized occupants were entitled to the benefit of grant of free hold
rights in the Government Order dated 1.12.1988. In the case of the
petitioner there being no dispute with regard to the possession of the
petitioner at any point of time, the State Government could not deny the
grant of free hold rights to the petitioner. Even if the requirement of a
registered agreement to sell is construed strictly even then the petitioner
 19

would be entitled to grant of free hold rights as an occupants.

Now we come to the second question as to what would be the

charges on which the free hold is required to be done.

Shri Rahul Sripat learned senior counsel for the petitioner has relied
upon the case on State of Uttar Pradesh and another vs. Harish
Tandon, (2016) 15 SCC 242 to argue that the Apex Court had directed
the lease hold rights to be converted into free hold rights in accordance
with Government Order dated 1.12.1998. The Hon'ble Supreme Court in
the said case was dealing with the issue as to whether the rates mentioned
in the Government Orders i:e based upon the circle rate would prevail or
the rates as notified by the U.P. Avas Evam Vikas Parishad and
Development Authorities for conversion of their land would apply to the
Nazul lease. The Hon'ble Supreme Court held that the Schemes are
different and the rates as prescribed for conversion by U.P. Avas Evam
Vikas Parishad and Development Authorities could not apply for
calculating the rates for conversion which would be governed on rates as
specified in the Government Orders for conversion of leasehold right into
freehold right i:e on the basis of circle rate. However, the Supreme Court
transposed the petitioner to the appropriate point of time and directed the
conversion of his rights on the basis of Government Order dated
1.12.1998. Para 7, 8 and 9 of the judgement are quoted herein below:

“7. The High Court, according to us, had faulted in

taking the view that for a common purpose, namely,
conversion of leasehold right to freehold right there
cannot be two different prescriptions prescribing two
different sets of fees/charges and any such position
would be contrary to Article 14. the basis of the
landholding by the State (nazul land) and the land
vested in the U.P. Avas Evam Vikas Parishad and
Development Authorities being distinct and different,
as noticed above, two different prescriptions
 20

containing two different rates/charges of conversion

would not be opposed to the mandate prescribed by
Article 14.

8. We, therefore, take the view that the High Court was
not correct in direction that the conversion of the
respondent-writ petitioner's leasehold rights to
freehold should be government by the G.O. Of 1995
which admittedly apply to the lease granted by the U.P.
Avas Evam Vikas Parishad and Development
Authorities.

9. Consequently and for the reasons above, we set

aside the orders of the High Court and dismiss the writ
petition filed by the respondent. However, transposing
the case to the appropriate point of time, we direct the
respondent-writ petitioner, if he so chooses, to apply
within a period of 30 days from today for conversion of
leasehold nazul land to freehold. The same be
considered by the State Government in accordance
with the G.O. Dated 1.12.1998.”

We are afraid that the benefit of the said concession cannot be

granted to the petitioner as the Supreme Court in the exercise of its power
under Article 142 had granted the said benefit which cannot be granted as
we are exercising the powers under Article 226.

The other relevant case on this question is the judgement of Full

Bench of this Court in the case of Anand Kumar Sharma vs. State of U.P.
(supra) is cited by both the parties. In the said case. the Full Bench was
called upon the answer:

"1. Whether the application of the petitioner dated 25.7.2005

submitted for grant of freehold right on the basis of the
Government Order dated 1.12.1998 (Paragraph 7) and the
Government Order dated 10.12.2002 (paragraph 5) was entitled to
 21

be considered in accordance with the Government policy as was

in existence on the date of application or the Government policy
as amended by Government Order dated 4.8.2006, was to be taken
into consideration while deciding the application on 18.12.2006?

2. Whether the Division Bench judgment in Dr. O.P. Gupta Vs.

State of U.P. 2009 (4) AWC 4038 lays down the correct law?"

The Full bench after considering the submissions recorded that the
applicant for free hold right has no vested right in his favour and,
secondly, it is not the date on application but the date of consideration for
grant of such rights which would be relevant for applying the prevalent
policy. We are bound by said Full Bench decision to the extent of law laid
down. The Full Bench had answered the questions raised before it in the
following manner:

(1) The application of the petitioner dated 25/7/2005

submitted for grant of free hold right on the basis of the
Government Orders dated 01/12/1998 and 10/12/2002 was
entitled to be considered in accordance with the government's
policy as was in existence at the time of passing of the order.
The Government Order dated 04/8/2006 was rightly relied on
by the Collector while rejecting the application on
18/12/2006.

(2) The Division Bench judgment in Dr. O.P. Gupta's case

(supra) does not lay down the correct law insofar as it holds
that the application for grant of freehold right is to be
considered as per the government policy as was in existence
on the date of making application for grant of freehold right.

Thus, in view of the Full Bench decision, it is clear that the

application of the petitioner is liable to be considered in accordance with
the freehold rates as prescribed in the relevant Government policy which
existed on 25.8.2006 as we have already held that the State Government
 22

was wholly wrong for passing the order dated 25.8.2006 rejecting the
application of the petitioner for grant of free hold rights.

We quash the same and direct that the application of the petitioner
for grant of free hold rights be considered on the rates that were prevalent
on 25.8.2006 treating the agreement to sell dated 8.3.1972 as an
agreement in conformity with the agreement referred to in the
Government Order dated 1.12.1998.

A mandamus is issued commanding the respondents to execute the

free hold deed on payment of the requisite charges calculating the payable
charges at the rates as were prevalent on 25.8.2006. The respondent no. 3
is directed to communicate the amount to be paid by the petitioner
calculating the free hold charges as applicable on 25.8.2006 within a
period of three months from today and, on payment of the said charges, as
may be directed, the respondent no. 3 is directed to execute the free hold
deed in favour of the petitioner within a further period of three months
from the date of deposit of the amounts that may be required from the
petitioner for conversion of his lease hold rights into free hold rights in
respect of Nazul Plot No. 2(A-10) Civil Station, Allahabad bearing
Municipal no. 22, Hastings Road (Nyay Marg), Allahabad as prayed by
the petitioner in his application filed on 30.1.1999.

Before parting with the cases, we deem it appropriate to highlight

certain facts which have led to the present litigation owing to the
indecision by the administrative authorities. The predecessor in interest of
the petitioner had filed an application on 20.1.1973 seeking necessary
permission for transfer of title in his name, however, no decision was
taken thereupon, thereafter, the petitioner applied for freehold rights on
30.1.1999. However, a decision thereupon was taken after about six years.
A counter affidavit, in the present case, was filed after 12 years. These
administrative delays have not been explained, the Court is of the view
that the administrative delays have led to the situation giving rise to the
 23

present writ petition. It is well settled that the administrative machinery

which have been mandated to take decision and time limit for taking
decisions is not prefixed are bound to take the said decisions in a
reasonable time. It is well settled that administrative inaction touches a
facet of Article 14 and thus any exercise of power vested even while
exercising administrative functions should be decided within a reasonable
time. The supreme court in the case of Ram Chand and others vs. Union
of India and others, (1994) 1 SCC 44 while dealing with the aspect of
delay in exercise of powers and reasonable time held as under:

14. The Parliament has recognised and taken note of

the inaction and non-exercise of the statutory power on
the part of the authorities, enjoined by the provisions of
the Act to complete the acquisition proceedings within a
reasonable time and because of that now a time-limit
has been fixed for making of the award, failing which
the entire proceeding for acquisition shall lapse. But,
can it be said that before the introduction of the
aforesaid amendment in the Act, the authorities were at
liberty to proceed with the acquisition proceedings,
irrespective of any schedule or time-frame and to
complete the same as and when they desired? It is
settled that in a statute where for exercise of power no
time-limit is fixed, it has to be exercised within a time
which can be held to be reasonable. This aspect of the
matter can be examined in the light of second proviso to
Article 31-A of the Constitution, which in clear and
unambiguous terms prohibits making of any law which
does not contain a provision for payment of
compensation at a rate, which shall not be less than the
market value thereof. The Act is consistent with the
second proviso to Article 31-A, because it provides for
payment of compensation at the market value of the
land acquired. But, whether the constitutional and
 24

statutory requirement of the payment of the market

value to the persons, whose lands have been
compulsorily acquired, as not being circumvented and
violated by keeping the land acquisition proceedings
pending for more than a decade and half, without
making the awards and paying the compensation, which
has been pegged to the dates of notifications under sub-
section (1) of Section 4 of the Act, which in the present
cases had been issued 14 to 21 years before the making
of the awards. If a person is paid compensation in the
year 1980/1981 at the market rate, prevailing twenty
years before, will that be compliance of the
constitutional and statutory mandate? Ignoring the
escalation of the market value of the lands, especially
near the urban agglomeration or metropolitan cities,
will amount to ignoring an earthquake and courts can
certainly take judicial notice of the said fact. The
interest and the solatium, which have to be paid under
the provisions of the Act, are linked with the market
value of the land with reference to the date of the
notification under sub-section (1) of Section 4 of the
Act. If a decision had been taken as early as in the year
1966, by issuance of declarations under Section 6, that
the lands belonging to the different cultivators, who
held those lands within the ceiling limit for cultivation,
were needed for public purpose, respondents should
have taken steps for completion of the acquisition
proceedings and payment of compensation at an early
date. In the present cases, unless a justification is
furnished on behalf of the respondents, can it be said
that the statutory power of making an award under
Section 11 has been exercised within a reasonable time
from the date of the declaration under Section 6? Due
to escalation in prices of land, more so in this area,
 25

during the preceding two decades, in reality, the market

rate, on the date of the notification under Section 4(1) is
a mere fraction, of the rate prevailing at the time of its
determination in the Award.

16. On behalf of the respondents, it was pointed out that

the petitioners have approached this Court only after
making of the awards, or when awards were to be
made, having waited for more than fourteen years,
without invoking the jurisdiction of the High Court
under Article 226 or of this Court under Article 32. It is
true that this Court has taken note of delay on the part
of the petitioners concerned in invoking the jurisdiction
of the High Court or of this Court for quashing the land
acquisition proceedings on the ground that the
proceedings for acquisition of the lands in question
have remained pending for more than a decade, in the
cases of Aflatoon v. Lt. Governor of Delhi 10 and
Ramjas Foundation v. Union of India”. According to us,
the question of delay in invoking the writ jurisdiction of
the High Court under Article 226 or of this Court under
Article 32, has to be considered along with the inaction
on the part of the authorities, who had to perform their
statutory duties. Can the statutory authority take a plea
that although it has not performed its duty within a
reasonable time, but it is of no consequence because the
person, who has been wronged or deprived of his right,
has also not invoked the jurisdiction of the High Court
or of this Court for a suitable writ or direction to grant
the relief considered appropriate in the circumstances?
The authorities are enjoined by the statute concerned to
perform their duties within a reasonable time, and as
such they are answerable to the Court why such duties
have not been performed by them, which has caused
 26

injury to claimants. By not questioning, the validity of

the acquisition proceedings for a long time since the
declarations were made under Section 6, the relief of
quashing the acquisition proceedings has become
inappropriate, because in the meantime, the lands
notified have been developed and put to public use. The
lands are being utilised to provide shelter to thousands
and to implement the scheme of a planned city, which is
a must in the present set-up. The outweighing public
interest has to be given due weight. That is why this
Court has been resisting attempts on the part of the
landholders, seeking quashing of the acquisition
proceedings on ground of delay in completion of such
proceedings. But, can the respondents be not directed to
compensate the petitioners, who were small cultivators
holding 10 (1975) 4 SCC 28 11 1993 Supp (2) SCC 20:
AIR 1993 SC 852 lands within the ceiling limit in and
around Delhi, for the injury caused to them, not by the
provisions of the Act, but because of the non-exercise of
the power by the authorities under the Act within a
reasonable time?

The government policy of conversion of lease rights into free hold

casts a duty on the administrative authorities to pass orders within a
reasonable time, however, as observed in the present case, the authorities
failed to act in a resonable time. Several cases pertaining to grant of free
hold arises and are pending in the High Court which reveal a similar story.

Thus, we issue a general mandamus commanding the District

Magistrates and concerned Additional District Magistrates (Nazul)
throughout the State of Uttar Pradesh to take a decision on all the pending
applications for grant of free hold rights pending in terms of various
government orders within a time bound period not exceeding six months.
The said direction shall apply even to the pending cases by lease holders
 27

who have requested for grant of free hold rights.

Learned Standing Counsel is directed to communicate a copy of

this order to the Chief Secretary for its circulation to all the District
Magistrates and Additional District Magistsrates (Nazul) for compliance
of the mandamus issued in the present case as well as for following the
general mandamus as issued hereinabove.

The Registrar General of this Court is directed to ensure the

communication of this order to the Chief Secretary for its circulation to all
the District Magistrates and the Additional District Magistrates (Nazul)
for compliance of the general mandamus issued in the present case.

The writ petition is allowed in terms of the said order.

No order as to costs.

Order Date :- 21.8.2019

Puspendra