In Brief
In this case, 117 landholders challenged a land acquisition initiated in 2004 for an industrial township in Gurgaon-Manesar. After acquisition was notified, private builders purchased land at throwaway prices under threat of acquisition. Just before the award was to be declared in 2007, the State abruptly dropped the acquisition, enabling builders to resell land at vastly inflated prices. The Supreme Court held that the entire process constituted 'fraud on power'—the State machinery had colluded with builders to deprive innocent farmers. The Court found the landholders' transactions were coerced, not voluntary. Rather than restore land to landholders, the Court deemed an award passed on the date it should have been pronounced, vesting the land in the State to serve the public purpose originally intended. Builders could not recover sums paid to landholders but received reimbursement for actual development costs. Individual apartment purchasers were protected by allotment rights. The judgment reaffirms that power to acquire land for public purposes cannot be abused to benefit private developers.
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