Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 = Since there was a petition under sec.14 , pending simultaneously filing Crl.M.P. is not maintainable as there was an interim orders = there was resistance to delivery of possession, the petitioner company lodged a FIR against the Director of the second respondent company under Sections 323 and 447 IPC. Simultaneously, it filed Crl.M.P.No.904 of 2015 before the learned Chief Metropolitan Magistrate, Hyderabad, taking recourse to Section 14 of the Act of 2002, which enables a secured creditor to avail the assistance of the Chief Metropolitan Magistrate/District Magistrate concerned to take possession of the secured asset. The learned Chief Metropolitan Magistrate, Hyderabad, thereupon passed order dated 15.04.2015 appointing an Advocate-Commissioner, the seventh respondent, and directed him to assist the petitioner company in taking possession of the secured asset. While so, the second respondent company filed Crl.M.P.No.1250 of 2015 in Crl.M.P.No.904 of 2015 seeking dismissal of the application filed by the petitioner company under Section 14 of the Act of 2002. Thereupon, the learned Chief Metropolitan Magistrate, Hyderabad, passed order dated 13.05.2015 restraining the seventh respondent from proceeding further till examination of the application. Hence, this writ petition.= We are informed that S.A.No.71 of 2013 has already been preferred by the second respondent company before the Debts Recovery Tribunal, Hyderabad, and that it is pending consideration. This being the lawful and proper remedy for the second respondent company, its parallel attempt to thwart the order dated 15.04.2015 by practically seeking review thereof cannot be countenanced. It is therefore left open to the second respondent company to pursue its lawful remedies in accordance with law. We reiterate that we have not ventured into the merits of the contentions raised by the second respondent company vis--vis the order dated 15.04.2015 and all such issues are left open. The writ petition is accordingly allowed setting aside the order dated 13.05.2015 passed by the learned Chief Metropolitan Magistrate, Hyderabad, in Crl.M.P.No.1250 of 2015 in Crl.M.P.No.904 of 2015. We further hold that the said criminal miscellaneous petition is not maintainable in terms of Section 14 of the Act of 2002 and the learned Chief Metropolitan Magistrate, Hyderabad, is directed to take steps accordingly. The learned Chief Metropolitan Magistrate, Hyderabad, is also directed to take necessary consequential steps pursuant to the order dated 15.04.2015 passed in Crl.M.P.No.904 of 2015, subject to orders, if any, in S.A.No.71 of 2013.

THE HONBLE SRI JUSTICE SANJAY KUMAR AND THE HONBLE DR.JUSTICE B.SIVA SANKARA RAO          

WRIT PETITION NO.25645 OF 2015    

24-06-2016

M/s. Phoenix Arc Private LimitedPetitioner.. Petitioner

The Court of the Honble Chief Metropolitan Magistrate, Metropolitan  Criminal
Courts, Red Hills, Hyderabad and othersRespondents  

Counsel for petitioner: Sri P. Sri Ram
                                               
Counsel for respondent No.1:  --
Counsel for respondent No.2:  Sri B.Srinivasa Reddy
Counsel for respondent Nos.3 to 6 :  --
Counsel for respondent No.7:  Sri M. Hamsa Raj

<Gist:

>Head Note:    


? CASES REFERRED:    

1.  (2013) 9 SCC 620
2.  2016 (2) ALT 226 (F.B.)
3.  (2012) 7 SCC 200
4.  (2016) 3 SCC 762
5.  (2012) 7 SCC 200

THE HONBLE SRI JUSTICE SANJAY KUMAR        
AND
THE HONBLE DR.JUSTICE B.SIVA SANKARA RAO          

WRIT PETITION NO.25645 OF 2015    

O R D E R
(Per Honble Sri Justice Sanjay Kumar)
       

      The petitioner is a securitisation and reconstruction company
registered under Section 3 of the Securitisation and Reconstruction
of Financial Assets and Enforcement of Security Interest Act, 2002
(for brevity, the Act of 2002). It is a secured creditor as defined
under Section 2(zd) thereof. By way of this writ petition, it challenges
the order dated 13.05.2015 passed by the learned Chief Metropolitan
Magistrate, Hyderabad, in Crl.M.P.No.1250 of 2015 in Crl.M.P.No.904
of 2015. A consequential direction is sought to the Advocate-
Commissioner appointed by the learned Chief Metropolitan
Magistrate, Hyderabad, to execute the warrant of possession.
      The petitioner company acquired a financial asset, being the
loan given by the Central Bank of India to the second respondent
company, under Assignment Agreement dated 28.03.2014. Even  
before acquisition of this financial asset by the petitioner company,
the Central Bank of India had classified the loan account of the
second respondent company as a non-performing asset and issued it
demand notice dated 20.08.2013 under Section 13(2) of the Act of
2002. The outstanding dues mentioned therein aggregated to
Rs.37,84,33,827/-. The objections raised in response thereto, under
Section 13(3A) of the Act of 2002, were considered by the Central
Bank of India and rejected under reply dated 21.10.2013.
      After acquisition of this financial asset, the petitioner company
initiated further measures for enforcement of the security interest
created by the second respondent company in relation thereto. This
security interest was the land admeasuring 6020 square yards and
the buildings thereon along with plant and machinery situated at
Sarojini Devi Road, Secunderabad. Proceedings under Section 13(4)
of the Act of 2002 were initiated by issuance of a possession notice
on 09.12.2014 under Rule 8(1) of the Security Interest (Enforcement)
Rules, 2002. However, as there was resistance to delivery of
possession, the petitioner company lodged a FIR against the Director
of the second respondent company under Sections 323 and 447 IPC.  
Simultaneously, it filed Crl.M.P.No.904 of 2015 before the learned
Chief Metropolitan Magistrate, Hyderabad, taking recourse to Section
14 of the Act of 2002, which enables a secured creditor to avail the
assistance of the Chief Metropolitan Magistrate/District Magistrate
concerned to take possession of the secured asset. The learned Chief
Metropolitan Magistrate, Hyderabad, thereupon passed order dated
15.04.2015 appointing an Advocate-Commissioner, the seventh  
respondent, and directed him to assist the petitioner company in
taking possession of the secured asset.
      While so, the second respondent company filed
Crl.M.P.No.1250 of 2015 in Crl.M.P.No.904 of 2015 seeking dismissal
of the application filed by the petitioner company under Section 14 of
the Act of 2002. Thereupon, the learned Chief Metropolitan
Magistrate, Hyderabad, passed order dated 13.05.2015 restraining
the seventh respondent from proceeding further till examination of
the application. Hence, this writ petition.
      Heard Sri P. Sriraghuram, learned senior counsel representing
Sri P.Sri Ram, learned counsel for the petitioner company, Sri Gopal
Rao Amancherla, learned counsel representing Sri B.Sreenivasa
Reddy, learned counsel for the second respondent company, and Sri
M.Hamsa Raj, learned counsel for the seventh respondent.
      The question raised before us is whether the Chief Metropolitan
Magistrate, Hyderabad, has jurisdiction under Section 14 of the Act
of 2002 to examine the objections raised by the second respondent
company in its application, Crl.M.P.No.1250 of 2015. Though Sri
Gopal Rao Amancherla, learned counsel, would strive to raise various
contentions as regards the alleged failure on the part of the petitioner
company in taking steps under the Act of 2002, we are of the opinion
that without addressing the preliminary issue as to maintainability of
Crl.M.P.No.1250 of 2015, the second respondent company cannot   
expect this Court to examine on merits the contentions urged by it in
Crl.M.P.No.1250 of 2015.
      Primarily, the scope of the power of a Chief Metropolitan
Magistrate/District Magistrate under Section 14 of the Act of 2002
falls for determination.
      Section 14(1) of the Act of 2002 broadly provides to the effect
that where the possession of a secured asset is required to be taken
by a secured creditor or if a secured asset is required to be sold or
transferred by a secured creditor, such secured creditor may, for the
purpose of taking possession or control of such asset, request, in
writing, the Chief Metropolitan Magistrate or the District Magistrate
within whose jurisdiction such secured asset is situated to take
possession thereof and the Chief Metropolitan Magistrate or the
District Magistrate shall, on such request being made to him, take
possession of and forward such asset to the secured creditor.  The
first proviso thereto states that any application by the secured
creditor in this regard shall be accompanied by an affidavit, duly
affirmed by the authorized officer of the secured creditor, and such
affidavit shall be in conformity with the declarations stipulated under
Clauses (i) to (ix) thereunder.  The second proviso to Section 14 states
that on receipt of such an affidavit from the authorized officer, the
Chief Metropolitan Magistrate or the District Magistrate, as the case
may be, shall, after satisfying the contents of the affidavit, pass
suitable orders for the purpose of taking possession of the secured
asset.  Section 14(1A) empowers the Chief Metropolitan Magistrate or
District Magistrate to authorize any officer subordinate to him to take
possession and forward such asset to the secured creditor.  Sub-
section (2) of Section 14 empowers the Chief Metropolitan Magistrate
or District Magistrate to take or cause to be taken such steps and use
or cause to be used such force, as may, in his opinion, be necessary,
for securing compliance with the provisions of Section 14(1).
      The scope and nature of the jurisdiction of a Chief Metropolitan
Magistrate/District Magistrate under Section 14 of the Act of 2002
fell for consideration before the Supreme Court in STANDARD
CHARTERED BANK V/s. V.NOBLE KUMAR .  The Supreme Court           
observed therein that the satisfaction of the Magistrate contemplated
under the second proviso to Section 14(1) necessarily requires the
Magistrate to examine the factual correctness of the assertions made
in such an affidavit but not the legal niceties of the transaction.
Again, in HARSHAD GOVARDHAN SONDAGAR V/s.           
INTERNATIONAL ASSETS RECONSTRUCTION CO. LTD. , the           
Supreme Court had occasion to deal with the scope of the power
exercised by a Chief Metropolitan Magistrate/District Magistrate
under Section 14 of the Act of 2002 and observed that when a
secured creditor seeks assistance to take possession of a secured
asset thereunder and a lessee of a mortgagor/borrower is in actual
possession, the secured creditor must state so in the affidavit filed
along with the application under Section 14 of the Act of 2002 and
also as to which class the lease in question falls under, that is, as to
whether it was created before the mortgage, or, after the mortgage
but before issuance of the demand notice under Section 13(2) of the
Act of 2002, or lastly, if it was created after issuance of the demand
notice under Section 13(2) of the Act of 2002. Once this aspect is
brought out in the affidavit filed by the secured creditor, the Supreme
Court held that the Magistrate would have to give notice and
opportunity of hearing to the lessee in possession of the secured
asset, falling under either the first class or the second class of leases
but not the last class, along with the secured creditor, in consistency
with the principles of natural justice, and then take a decision. If the
Magistrate is satisfied that there is a valid lease created before the
mortgage or prior to receipt of the notice under Section 13(2) of the
Act of 2002, he cannot pass an order for delivering possession of the
secured asset. In such cases, when the lessee makes out a case that 
his lease falls under either of the first two classes of leases specified
above, the actual possession cannot be delivered to the secured
creditor until the lease is validly determined in accordance with law.
      Relying on the aforestated judgments of the Supreme Court, a
Full Bench of this Court in T.R.JEWELLERY V/s. STATE BANK OF    
INDIA, VEDAYAPALEM BRANCH, NELLORE  held that a Magistrate        
is empowered under Section 14 of the Act of 2002 to authorize a
subordinate official to take possession of the asset after examining
the factual correctness of the assertions made in the affidavit and
therefore, it could be said without any shadow of doubt that the
assistance taken under this provision is only procedural in nature
and no adjudication is involved.  The Full Bench observed that use of
the word order in Section 14 is only a reference to an administrative
order made for taking possession of the secured asset if all other
conditions are fulfilled.  The Full Bench confirmed that the power
exercised by the Chief Metropolitan Magistrate or District Magistrate
was synonymous and that it was not adjudicatory in nature.
      It may be noticed that in VISHAL N.KALSARIA V/s. BANK OF
INDIA , clarifying the law laid down in HARSHAD GOVARDHAN  
SONDAGAR2, the Supreme Court stated that even if no registered  
lease deed exists, then such tenants who are required to prove that
they have been in occupation of the premises as tenants may be
permitted to produce such evidence in proceedings under Section 14
of the Act of 2002 before the Chief Metropolitan Magistrate/District
Magistrate. This decision was rendered in relation to protected
tenants under the Maharashtra Rent Control Act, 1999. The
applicability of the ratio of this judgment in the States of Telangana
and Andhra Pradesh is however open to question in the light of the
amendment effected in the year 1999 to the Registration Act, 1908, in
so far as it applies to the erstwhile combined State of Andhra
Pradesh, making lease deeds in respect of leases even for a period of
less than one year compulsorily registrable under Section 17 thereof.
Significantly, there is no such requirement in Maharashtra.
      In any event, the aforestated case law makes it crystal clear
that the Chief Metropolitan Magistrate/District Magistrate, in
exercise of power under Section 14 of the Act of 2002, is only
required to undertake a factual examination of the entitlement of a
secured creditor to take possession in terms of Section 14(1)(b)(viii),
by ascertaining the factum of actual possession. Beyond determining
this fact on the basis of a hearing and the documents placed on
record, the Chief Metropolitan Magistrate/District Magistrate is not
empowered to undertake any sort of adjudicatory process.
      This being the settled legal position, the Chief Metropolitan
Magistrate, Hyderabad, was only empowered to examine the
assertions made in the affidavit filed by the petitioner company and
upon being satisfied therewith, to the extent indicated in the
aforestated decisions, pass an appropriate order. This exercise
already culminated in the order dated 15.04.2015. Being an
administrative functionary in the scheme of Section 14 of the Act of
2002, the Chief Metropolitan Magistrate, Hyderabad, had no power of
reviewing the order dated 15.04.2015, as no such power is conferred
upon him under the Act of 2002.  Well settled is the legal proposition
that unless the power of review is specifically conferred by the statute
itself, an administrative authority acting in furtherance of the power
conferred by such statute cannot assume unto itself such power of
review (See HARYANA STATE INDUSTRIAL DEVELOPMENT          
CORPORATION LIMITED V/s. MAWASI ). In the event an erroneous    
order is passed by a Chief Metropolitan Magistrate/District
Magistrate in exercise of the administrative power conferred by
Section 14 of the Act of 2002, the borrowers remedy against the
same, as pointed out in STANDARD CHARTERED BANK1, is by way      
of an application under Section 17 of the Act of 2002 to the Debts
Recovery Tribunal concerned. The Chief Metropolitan Magistrate,
Hyderabad, therefore had no right to keep further proceedings
pursuant to the order dated 15.04.2015 in abeyance while seeking to
exercise the power of review upon the application in Crl.M.P.No.1250
of 2015 filed by the second respondent company.
      We are informed that S.A.No.71 of 2013 has already been
preferred by the second respondent company before the Debts 
Recovery Tribunal, Hyderabad, and that it is pending consideration.
This being the lawful and proper remedy for the second respondent
company, its parallel attempt to thwart the order dated 15.04.2015
by practically seeking review thereof cannot be countenanced. It is
therefore left open to the second respondent company to pursue its
lawful remedies in accordance with law. We reiterate that we have not
ventured into the merits of the contentions raised by the second
respondent company vis--vis the order dated 15.04.2015 and all
such issues are left open.
      The writ petition is accordingly allowed setting aside the order
dated 13.05.2015 passed by the learned Chief Metropolitan
Magistrate, Hyderabad, in Crl.M.P.No.1250 of 2015 in Crl.M.P.No.904
of 2015. We further hold that the said criminal miscellaneous petition
is not maintainable in terms of Section 14 of the Act of 2002 and the
learned Chief Metropolitan Magistrate, Hyderabad, is directed to take
steps accordingly. The learned Chief Metropolitan Magistrate,
Hyderabad, is also directed to take necessary consequential steps
pursuant to the order dated 15.04.2015 passed in Crl.M.P.No.904 of
2015, subject to orders, if any, in S.A.No.71 of 2013. Pending
miscellaneous petitions shall stand closed in the light of this final
order.  No order as to costs.
______________________  
SANJAY KUMAR, J  
_______________________________    
DR.B.SIVA SANKARA RAO, J    
24th JUNE, 2016

the Security Interest (Enforcement) Rules, 2002 Rule 9 Sub-rule (1) No sale of immovable property under these rules shall take place before the expiry of thirty days from the date on which the public notice of sale is published in news papers or notice of sale has been served to the borrower.= It is thus clear that sale of an immovable property of the defaulted borrower can be undertaken only after expiry of thirty days period after the notice in that regard is delivered to the borrower and also it is published in newspapers for the information of the general public. The purpose that is sought to be achieved from this requirement is to provide one more opportunity to the defaulted borrower to liquidate the liability before the expiry of thirty days time. Further, even if he does not have the necessary financial wherewithal to clear the liability entirely on his own, he will be able to utilize this time for organizing the necessary help for liquidating the liability. Alternatively, the defaulting borrower may scout for an appropriate source or person, who himself can acquire the asset for as nearer the market price prevailing as is possible. In the process, the interests of the secured creditor are also protected equally.Hence, service of notice and then giving a minimum of thirty days time before the asset is liquidated is bound to be regarded as a mandatory requirement. Whereas, in the instant case, though a decision has been taken to deliver the notice of the intended sale of the respective secured assets, but however, it has resulted in serving the notices providing for less than thirty days time for the borrower. By thus short-circuiting the requirement of Rules 8 and 9, read together, the chances of the borrower securing a prospective purchaser entirely on his own, got impaired. We are therefore, of the opinion that the respondent bank has not complied with the mandatory requirements of Rules 8 and 9 and hence, it cannot liquidate the secured asset for realizing the debt due. In that view of the matter, we have no hesitation to allow these Writ Petitions and we do it accordingly. No costs.

THE HONBLE SRI JUSTICE NOOTY RAMAMOHANA RAO AND THE HONBLE DR. JUSTICE B.SIVA SANKARA RAO                  

WRIT PETITIONS No. 3676 OF 2016 and batch    

01-03-2016

M/s Bhuvana Kisan Seva Kendra Proprietor Gopagoni Sugunakar.Appellant  

Bank of Baroda.Respondent  

Counsel for the Appellant: Sri B.S. Prasad

Counsel for the Respondent:Sri G. Vasantha Rayudu.


<GIST:

>HEAD NOTE:  

? Cases referred

THE HONBLE SRI JUSTICE NOOTY RAMAMOHANA RAO            
AND
THE HONBLE DR. JUSTICE B. SIVA SANKARA RAO        

WRIT PETITIONS No. 3676, 3685, 3766 AND 3795 OF 2016    

COMMON ORDER : (per Honble Sri Justice Nooty Ramamohana Rao)      
      These Writ Petitions can be disposed of by this common
order as the respondent bank namely Bank of Baroda is common  
in all the cases.  Further, the question that has fallen for our
consideration is also identical in all these Writ Petitions.
      In all these cases, the securitization measures adopted by
the respondent bank, in particular proposing to put the secured
asset to sale is questioned. There is no dispute on the factual
count that the respective writ petitioners are borrowers and they
answer the said expression as defined in Section 2(1)(f) of the
Securitization and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 (for short, the Act),
which has been ushered in to regulate the securitization and
reconstruction of financial assets and enforcement of security
interests.  The respondent bank answers the description of bank,
as defined in clause (c) of sub-section (1) of Section 2, as it is a
banking company within the meaning of Section 5(c) of the
Banking Regulation Act, 1949.  There is also no further difficulty
for us to hold that default has been committed as was defined in
Section 2(1)(j).  The expression financial asset has been defined in
Section 2(1)(l) in the following terms:
 financial asset means debt or receivables and includes
i)      a claim to any debt or receivables or part thereof, whether
secured or unsecured; or
ii)     any debt or receivables secured by, mortgage of, or charge on,
immovable property; or
iii)    a mortgage, charge, hypothecation or pledge of movable
property; or
iv)     any right or interest in the security, whether full or part
underlying such debt or receivables; or
v)      any beneficial interest in property, whether movable or
immovable, or in such debt, receivables, whether such interest is
existing, future, accruing, conditional or contingent; or
vi)     any financial assistance.

Consequently, the mortgage created by the respective writ
petitioners renders the same as a financial asset.  There is also no
difficulty that the respective accounts of the borrowers have been
declared as non-performing assets as per the definition assigned
to the said expression in clause (o) of sub-section (1) of Section 2.
The expression secured asset has been defined in clause (zc) of
sub-section (1) of Section 2 of the Act as meaning the property on
which the security interest is created.
      Section 13 of this Act has provided for measures for
securitization, which can be adopted for enforcement of the
security interest.  Under sub-section (2) of Section 13, a notice of
demand has to be drawn after the asset is declared as a non-
performing asset, calling upon the borrower to liquidate the entire
liability, by providing him a minimum of sixty days time.  If the
debt remains un-liquidated and/or the notice issued under sub-
section (2) of Section 13 remains un-answered to the satisfaction of
the respective bankers, measures provided for under sub-section
(4) thereof can be initiated. Under clause (a) of sub-section (4), the
secured creditor may take possession of the secured asset of the
borrower including the right to transfer by way of lease,
assignment or sale for realizing the secured asset.  Hence, the
proposed action of the respective bankers cannot be taken
exception to in view of the fact that sub-section (4) of Section 13
authorizes such an action to be taken in case default is committed
by the borrower.
      Under Section 38 of the Act, Central Government has been
conferred power to make, by notification, rules for carrying out the
provisions of the said Act.  Accordingly, the Security Interest
(Enforcement) Rules, 2002 (henceforth be referred to for short as
the Rules) have been framed and they are notified by the Central
Government on 20.09.2002.  These Rules have provided for the
mechanism of giving effect to the provisions contained in the Act
itself.  Sub-rule (1) of Rule 8 thereof spelt out that where the
secured asset is an immovable property, the authorized officer
shall take or cause to be taken possession, by delivering a
possession notice prepared as nearly as possible to the one
specified in Appendix - IV to these Rules, to the borrower and also
by affixing the possession notice on the outer door or at such
conspicuous place of the immovable property.  Rule 9 dealt with
aspects such as time of sale, issue of sale certificate, delivery of
possession, etcetera.  Sub-rule (1) thereof reads as under:
               No sale of immovable property under these rules shall
take place before the expiry of thirty days from the date on
which the public notice of sale is published in news papers or
notice of sale has been served to the borrower.

      It is thus clear that sale of an immovable property of the
defaulted borrower can be undertaken only after expiry of thirty
days period after the notice in that regard is delivered to the
borrower and also it is published in newspapers for the
information of the general public.  The purpose that is sought to be
achieved from this requirement is to provide one more opportunity
to the defaulted borrower to liquidate the liability before the expiry
of thirty days time. Further, even if he does not have the necessary
financial wherewithal to clear the liability entirely on his own, he
will be able to utilize this time for organizing the necessary help for
liquidating the liability.  Alternatively, the defaulting borrower may
scout for an appropriate source or person, who himself can acquire
the asset for as nearer the market price prevailing as is possible.
In the process, the interests of the secured creditor are also
protected equally.  The publication in newspapers is bound to
attract the attention of the prospective purchasers, who also will
try to ascertain, in the meantime, as to the reasonable market
value that the immovable property in question would fetch and on
that basis, they would be preparing themselves for participation or
filing the bids. Further more, to avoid formation of unhealthy
cartels, who will look for acquiring the asset, with a view to secure
a valuable asset for a far lesser price than it can reasonably fetch
in the open market, the public notice of inviting bids now-a-days is
followed by the method of holding electronic auctions, known as
e-auctions.  In this method, the bidders may not be knowing each
other and the prospects of the cartel formation and then their
trying to regulate the auction process is completely neutralized.
Only genuine participant in auctions will receive the necessary
consideration at the hands of the creditor. Therefore, a fair and
transparent procedure is sought to be followed even while
disposing of the secured asset by the secured creditor.  Hence,
service of notice and then giving a minimum of thirty days time
before the asset is liquidated is bound to be regarded as a
mandatory requirement. 
      Whereas, in the instant case, though a decision has been
taken to deliver the notice of the intended sale of the respective
secured assets, but however, it has resulted in serving the notices
providing for less than thirty days time for the borrower.  By thus
short-circuiting the requirement of Rules 8 and 9, read together,
the chances of the borrower securing a prospective purchaser
entirely on his own, got impaired.   We are therefore, of the opinion
that the respondent bank has not complied with the mandatory
requirements of Rules 8 and 9 and hence, it cannot liquidate the
secured asset for realizing the debt due. In that view of the matter,
we have no hesitation to allow these Writ Petitions and we do it
accordingly. No costs.
      However, it shall be open to the respondent bank to take all
such measures, which are in accordance with law, against the
defaulted borrower.
      Consequently, the miscellaneous applications, if any shall
stand disposed of.
-----------------------------------------
NOOTY RAMAMOHANA RAO, J        
----------------------------------------
DR. B. SIVA SANKARA RAO, J    
01st March 2016

A.P. Water, Land Trees Act, 2002 - a company incorporated under the Companies Act, to issue a writ of mandamus declaring the action of the respondents in seizing the fire wood under transport to the petitioner company in the guise of contravention of A.P. Water, Land Trees Act, 2002 and the Rules made thereunder as illegal, void and without jurisdiction and to declare Respondent No.4 as not notified or specified to be the Designated Officer under the Act and for a direction to Respondent No.5 to refrain from in any way proceeding against the petitioner- company in the transportation of specified exempted species of fire wood to the premises of the petitioner's factory.- Under the guise that certain species of wood are exempted under the A.P. Forest Produced Transit Rules, the petitioner or any other individual cannot be permitted to encourage cutting of such trees without obtaining permission from the designated authority under the provisions of the Act. It is obligatory under the provisions of the Act to obtain prior permission from the concerned authority to cut or fell any kind of tree in the area and the Trees Act has not exempted any category of tree from the provisions of the Act. As Ex-officio Chairman of the Mandal Authority, it is the duty of the Mandal Revenue Officer to protect the living trees and also get tree plantation wherever trees fell due to various reasons.- under the A.P.Water, Land and Trees Act, 2002, it has been specifically stated in Rule 10 that the District Authority may utilize the services of Designated Officers and technical Officers in discharging of its functions. I have also found from Rule 8 wherein it has been specifically mentioned as to who can be treated as a Designated Officer under the said Rule since the District Authority has been prescribed in the said Rule. Accordingly, in my opinion, the Designated Authority is the Mandal Revenue Officer and in fact he has a right to take steps in the matter and I find that the Designated Authority has acted in accordance with the provisions of the Trees Act, 2002 to safeguard the public interest and petitioner is not entitled for the relief prayed for.

HON'BLE THE ACTING CHIEF JUSTICE SRI PINAKI CHANDRA GHOSE            

WRIT PETITION No.8827 OF 2003  

06-09-2012

H.C.L.AGRO POWER LIMITED VEDADRI VILLAGE, JAGGAIAHPET MANDAL, KRISHNA DISTRICT                  
REP. BY ITS MANAGING DIRECTOR                  

A.P.STATE WATER, LAND AND TREES AUTHORITY REP. BY EX.OFFICIO MEMBER SECRETARY                    
SECRETARY TO GOVERNMENT, INCHARGE OF RURAL DEVELOPMENT, SECRETARIAT BUILDINGS,                        
HYDERABAD    

Counsel for the petitioner: SRI.M.SUDHEER KUMAR  
Counsel for the respondents: Govt.Pleader for Panchayat Raj and Rural
Development

<Gist:

>Head Note:

?CITATIONS:

JUDGMENT:  

        This Writ Petition has been filed by HCL Agro Power Limited, Vadadari,
Krishna District,  a company incorporated under the Companies Act, to issue a
writ of mandamus declaring the action of the respondents in seizing the fire
wood under transport to the petitioner company in the guise of contravention of
A.P. Water, Land Trees Act, 2002 and the Rules made thereunder as illegal, void
and without jurisdiction and  to declare Respondent No.4 as not notified or
specified to be the Designated Officer under the Act and for a direction to
Respondent No.5 to refrain from in any way proceeding against the  petitioner-
company in the transportation of specified exempted species of fire wood to the
premises of the petitioner's factory.
2.      The petitioner company was established for generating electrical energy of
the capacity of 6 MW by employing a process consisting of bio mass material such
as waste wood, Julie flora, agricultural waste such as paddy husk, corn stems
etc.    Waste wood includes Neem, Tumma etc Under the A.P. Forest Produce  
Transit Rules, 1970 Neem, Tumma including kancha (fencing) tumma are notified to
be the exempted species  and the felled produce of such exempted species can be
transported without any transit permit under the said Rules and for
transportation of all other categories of wood  other than the exempted
categories permission is required to be obtained from the forest authorities.
The petitioner-company is procuring fire wood for the purpose of the company by
purchasing the exempted species of trees which were cut or felled from various
districts where such species are notified as exempted under the Rules. Since
there is no prohibition for transportation of such exempted categories of wood,
the petitioner is procuring such wood from the concerned for generating the
electrical energy after obtaining permits from the forest authorities though
under the A.P. Forest Produce Transit Rules, 1970 it is not obligatory to obtain
permission.  The grievance of the petitioner is that under the guise of a
prohibition under A.P. Water, Land Trees Act, 2002 (hereinafter referred to as
'the Trees Act') Respondent No.4 - Mandal Revenue Officer (Designated Officer),
Jaggaiahpet Mandal is seizing vehicles transporting such exempted fire wood to
the petitioner factory on the ground that such material was procured by felling
the trees without obtaining any prior permission from the Designated Officer.
Respondent No.4 has seized number of vehicles transporting the fire wood to the
petitioner factory and compounded the offence under coercion and collected
thousands of rupees with reference to the quantity of the fire wood under
transport under the provisions of Trees Act.  According to the petitioner,
Respondent No.5 - Divisional Forest Officer, Vijayawada is insisting that the
power projects were required to obtain felling permission even for using the
exempted category fire wood in view of Section 28(5) of the Trees Act.
According to the petitioner, there is no prohibition under the provisions of the
Trees Act for cutting or felling any tree which is an exempted species,
therefore, imposition of penalty under the provisions of the Trees Act is
without jurisdiction and cannot be sustained.
3.    In the counter filed by the respondents it is stated that  Jaggaiahpeta
Mandal where the petitioner company is located is facing air pollution due to
the left over material of cement factories and the establishment of the
petitioner factory has further increased the pollution level since the
petitioner company is encouraging cutting of live trees such as Neem, Thumma
etc.  for utilizing them as raw material instead of utilizing the bio-mass
material such as waste wood, julieflora, agricultural waste.   The petitioner
company is encouraging the poor labour, small and marginal farmers to cut the
living trees in the fields as well as in the private houses to produce the same
to their factory for generating power.  Under the provisions of the Trees Act,
the Government has designated the Mandal Revenue Officer as Ex-Officio Chairman
and other Mandal Level Officers as members of the Mandal Authorities.  It is the
duty of the Mandal Revenue Officer to protect the living trees and also to get
tree plantation wherever trees fell due to various reasons. The Mandal Revenue
Officer is empowered to compound the offences under Section 37 of the Trees Act
and also has the power to seize the property under Section 38. It is further
stated that tractors/lorries which are carrying cut trees of neem, tumma etc of
the age of 5 to 10 years are only seized and offences are compounded so as to
prevent the ryots/farmers/labourers from cutting the living trees.  It is
specifically averred that apart from the bio-mass material the petitioner
company is in the habit of taking delivery of cut trees of neem and other trees
of 5 to 10 years which attracts the provisions of the Trees Act.  The Mandal
Revenue Officer as Designated Authority under the Act has performed his
legitimate duties in the interest of public.  According to the respondents, even
for the usage of felling of trees or branches, permission of the designated
officer is required under Section 28(5) of the Act. The designated officer has
acted in accordance with the provisions of the Trees Act to safeguard public
interest and to maintain pollution free area.
4.      We have heard the learned counsel for the petitioner and the learned
counsel for the respondents.
5.      Learned counsel for the petitioner submitted that under section (2) of
Section 28 of the Trees Act, the Authority under the Act is empowered to direct
the Municipal Corporation or Municipality or the other Local Authorities, as the
case may be, to designate an officer to be incharge of tree plantations in their
respective areas, whereas sub-section (2) of Section 2 defines "Designated
Officer" to mean an officer or any person so designated by the Authority to
perform the functions under the Act.  Though there is inconsistency in the two
provisions since the charging section has overriding effect over the definition
clause, the Designated Officer is to be designated by the local authority under
the directions of the 1st respondent Authority.  Since the 4th respondent has
not been appointed under the directions of the Andhra Pradesh State Water, Land
and Trees Authority constituted under Section 3 of the Act, 4th respondent has
no jurisdiction to impose the penalties under the provisions of the Trees Act
nor has the authority to seize the wood or the vehicles. It is further contended
that since Neem, Tumma and other trees are exempted species under the A.P.
Forest Produce Transit Rules, 1970 and since there is no prohibition under the
Trees Act to cut such trees, the Trees Act has no application insofar as those
exempted species of trees are concerned and no permission for felling of trees
or branches is required to be obtained.
6.      The learned counsel for the respondents submitted that Mandal Revenue
Officer was designated as the Designated Authroity under the provisions of the
Trees Act by the Government itself and as such the Mandal Revenue Officer has
jurisdiction and authority to discharge the functions under the provisions of
the Trees Act.   He further submitted that though Neem, Tumma etc. are exempted
species, the provisions of the Trees Act  have application notwithstanding the
A.P. Forest Produce Transit Rules, 1970 and, therefore, permission is required
to be obtained for cutting and transportation of the wood related to such
species also and prayed for dismissal of the writ petition.
7.      Before we consider contentions urged on behalf of the petitioner, we may
briefly  refer to the provisions of the Andhra Pradesh Water, Land and Trees
Act, 2002 (Act No.10 of 2002).  The main object behind the enactment is to
promote Water Conservation and Tree Cover and Regulate the Exploitation and use
of Ground and Surface Water for Protection and Conservation of Water Sources,
Land and Environment and matters connected with or incidental thereto. Sub-
section (1) of Section 2 defines "Authority" to mean the Andhra Pradesh State
Water, Land and Trees Authority constituted under Section 3 and sub-section (2)
of Section 2 defines "Designated Officer" to mean an officer or any person so
designated by the Authority to perform the functions under the Act.  Chapter 2
deals with constitution of the Authority. For the purpose of this writ petition,
we are not concerned with the constitution of the 'Authority'.  Chapter V
consisting of Sections 28 to 32 deals with Trees.  Sub-section (1) of Section 28
provides that the Authority may direct that every Municipal Corporation or
Municipality or any other Local Authority, as the case may be, to insist for
compulsory plantation with such number of trees and their maintenance as may be
prescribed while according approval of building plans. Sub-section (2) and (5)
which are relevant for our purpose reads as under:
        "(2) The Authority may also direct the Municipal Corporation or
Municipality or the other Local Authorities, as the case may be, to designate an
officer to be in charge of tree plantations in their respective areas.
                          XX                                    XX

        (5) No felling of the trees or branches is permitted without the prior
permission of the designated officer.  In case when a tree is to be felled, not
less than two seedlings should be planted and when such planting is not
possible, cost of raising seedlings and their maintenance shall be recovered
from the concerned individual, organization or other persons for raising
plantations in public places."

Sub-section (1) of Section 29 of the Trees Act provides that any person,
institution, organization or department, public or private, providing a public
or private utility service  including Roads and Buildings Department, Energy
Department of the Government and Telecommunications Department shall ensure  
protection of trees and their branches while developing their infrastructure or
carrying on their activities.  Section 30 deals with Tree plantations by
Government departments etc.  Sub-section (3) of Section 30 which is relevant may
be extracted below:
"(3) All agricultural land owners except small and marginal  farmers  and
wetland owners as determined by the Government  shall plant trees in their land
holding as prescribed by the Authority upto 5% of their total land holding and
felling permission for trees shall be given only when the land owner plants
trees in equal extent of land.

Provided that the area covered by the existing tree growth including fruit
bearing horticultural crops shall be included while calculating the area under
tree growth.

Provided further that suitable incentives, as may be prescribed, shall be given
to the land owner who plants tree species in his total land holding."

Section 35 provides for penalties.  Sub-section (1) of Section 35 provides that
whoever contravenes any of the provisions of the Act or obstructs any person in
the discharge of his duties under the Act or contravenes any order or violates
any rule made under the Act shall be punished with fine which shall not be less
than one thousand rupees but which may extend five thousand rupees. Sub-section
(3) of Section 35 provides that whoever without any lawful authority fells a
tree shall be punished with a fine which shall not be less than two times of the
value of  such trees but which may extend to five times of value of such tree.
Section 37 which deals with compounding of offences to the extent relevant reads
as under:
"37. (1) Notwithstanding anything  contained in the in the Code of Criminal
Procedure, 1973 (Central Act 2 of 1974), the Authority or the Designated Officer
any Officer authorized by the Government in this regard, as the case may be, may
accept from any person who committed or who is reasonably suspected of having
committed an offence punishable under the Act other than the offences punishable
under sub-section (2) of Section 35 of this Act, --
(i) a sum of money as may be prescribed, by way of     compounding of the
offence.

(ii) The Authority or Designated Officer or any other officer  authorized by the
Government in this regard, as the case may be, may reject to compound the
offence for the reasons recorded in writing;


(ii) The Authority or Designated Officer or any officer authorized by the
Government in this regard, as the case may be, shall pass order to compound the
offence or otherwise within a period as may be prescribed. "

Section 39 of the Act provides that the provisions of the Act shall have effect
notwithstanding anything to the contrary contained in any other law for the time
being in force.
8.      No doubt under sub-section (2) of Section 28 of the Trees Act, the
Authority constituted under section 3 of the Act is empowered to direct the
Local Authorities to designate an officer to be in charge of tree plantations in
their respective areas whereas under sub-section (2) of Section 2 defines
"Designated Officer" to mean any officer or any person so designated by the
Authority to perform the functions under the Act.  Notwithstanding the
definition clause, under the charging section 28(2), the State Authority has
power to direct a local authority to designate an officer to be in charge of the
plantations. But, under Rule 9(1) of the Andhra Pradesh Water, Land and Trees
Rules, 2002 the Government may by notification constitute a Mandal Authority
which consists of (a) Mandal Revenue Officer of the concerned Mandal as Ex
Officio Chairman, Mandal Development Officer Ex-Officio Vice Chairman, Sarpanch
of the Mandal Headquarter as Ex-officio member etc. and the Government by
notification issued in G.O.Ms.No.244, Panchayat Raj and Rural Development
(RD.IV) dated 24.6.2002 constituted  Authority for each Mandal in the State.
Under sub-rule (3) of Rule 9 the Mandal Authority shall conduct meetings and
perform such functions as delegated under Section 6 of and Section 3(6) of the
Act by the Authority and other functions as directed by the Government. The
Mandal Authority is empowered to perform such functions as delegated under
section 6 of the Act. Therefore, notwithstanding that a designated Officer is
appointed by a  local authority, the Mandal Authority which is constituted by a
notification of the Government in accordance with the Rules framed under the
Act, is empowered to discharge the functions under the Act insofar as the Mandal
is concerned.  The Mandal Revenue Officer who is the designated authority,
therefore, has jurisdiction to impose the penalties under the provisions of the
Act and has power to seize the property or the vehicles which are transporting
the wood without obtaining permission. It is not the case of the petitioner that
any other Officer has been designated as the "Designated Officer" and such
officer has failed to discharge the functions. Further, sub-section (1) of
Section 37 of the Trees Act clearly provide that the Authority or the Designated
Officer or any Officer authorized by the Government  is permitted to accept the
money as may be prescribed by way of compounding of the offence or reject to
compound the offence for the reasons recorded in writing. Therefore, the Mandal
Revenue Officer who is an Officer appointed by the Government by notification
has certainly jurisdiction to deal with the penalties.  The designated authority
is not only concerned with tree plantation but also empowered to perform the
functions under the provisions of the Act. The contention of the petitioner that
the Mandal Revneue Officer has no jurisdiction to perform the functions under
the Act, therefore,   has no merit.
9.      Admittedly, the power plant of the petitioner company has to generate
electrical energy primarily employing a process consisting of bio-mass material
such as waste wood, Julie flora, agricultural waste such as paddy husk, ground
net husk etc. But the petitioner company under the guise that certain trees like
neem, tumma etc. are exempted species under the A.P. Forest Produce Transit
Rules, 1970 and there is no prohibition to cut such trees, is procuring such
wood from the ryots and labourers from various districts and utilizing the same
for the purpose of generation of power. The contention of the petitioner that no
permission is required to procure such exempted categories of wood from the
ryots or labourers has no merit. The Trees Act is enacted mainly to promote
Water Conservation and Tree Cover and regulate the exploitation and use of
ground and surface water and for protection of water sources, land and
environment to maintain a pollution free area in the interest of public.
Section 39 of the Act clearly provides that the provisions of the Act shall have
effect notwithstanding anything to the contrary contained in any other law for
the time being in force. Therefore, the Trees Act has overriding effect over the
A.P. Forest Produce Transit Rules, 1970.  As such, even though Neem, Tumma and  
other species are exempted under the A.P. Forest Produce Transit Rules, 1970,
petitioner-company or any other individual connected with the cutting of such
trees is under an obligation to obtain permission from the authority empowered
under the Trees Act to grant such permissions before cutting the trees.   The
main object of the Trees Act being to protect the environment in the area, if
illegal cutting of trees without obtaining prior permission is allowed, the
level of pollution in the area may increase affecting the public interest at
large.   In the counter-affidavit, the respondents have taken the stand that the
petitioner company is encouraging cutting of live trees by the poor labour,
small and marginal farmers for utilizing the same as raw material instead of
utilizing the bio-mass material such as waste wood, agriculture waste and that
the seized lorries contain trees of neem, tumma of the age of 5 to 10 years.
Sub-section (5) of Section 28 clearly provides that no felling of the trees or
branches is permitted without prior permission of the designated officer. Sub-
section (3) of Section 30 provides that permission for felling of trees shall be
given only when the land owner plants trees in equal extent of land.  The
Legislature, therefore, has designedly framed the law so as to prevent any
illicit or illegal felling of+ trees affecting the environment.  Indiscriminate
felling of trees would badly affect the bio-sphere and the environment in the
area.  Under the guise that certain species of wood are exempted under the A.P.
Forest Produced Transit Rules, the petitioner or any other individual cannot be
permitted to encourage cutting of such trees without obtaining permission from
the designated authority under the provisions of the Act.  It is obligatory
under the provisions of the Act to obtain prior permission from the concerned
authority to cut or fell any kind of tree in the area and the Trees Act has not
exempted any category of tree from the provisions of the Act. As Ex-officio
Chairman of the Mandal Authority, it is the duty of the Mandal Revenue Officer
to protect the living trees and also get tree plantation wherever trees fell due
to various reasons.
10.     It is also pointed out before me that under the A.P.Water, Land and Trees
Act, 2002, it has been specifically stated in Rule 10 that the District
Authority may utilize the services of Designated Officers and technical Officers
in discharging of its functions. I have also found from Rule 8 wherein it has
been specifically mentioned as to who can be treated as a Designated Officer
under the said Rule since the District Authority has been prescribed in the said
Rule. Accordingly, in my opinion, the Designated Authority is the Mandal Revenue
Officer and in fact he has a right to take steps in the matter and I find that
the Designated Authority has acted in accordance with the provisions of the
Trees Act, 2002 to safeguard the public interest and petitioner is not entitled
for the relief prayed for.

11.       For the reasons aforesaid, we find no merit in the Writ Petition and it
is accordingly dismissed.  There shall be no order as to costs.

PINAKI CHANDRA GHOSE, ACJ      
6th September, 2012            

A.P. Water, Land and Trees Act, 2002 The Act is purely regulatory in nature. Sinking of bore-well is not a prohibited activity. It is only in the process of regulation that certain restrictions are placed, on the freedom of a citizen to sink bore-well in his land. Such a freedom can be curtailed, only by making reference to the relevant provisions of law. The situations contemplated under the Act are many, ranging from prohibition of pumping of water from existing wells, to the one of banning the sinking of new wells, in the area as regards which a declaration issued under Section 11 of the Act, is in operation. The sinking of well can be found fault with, if only it is found to be in contravention of any particular provision of law. Further, it is only when the reasons are communicated to the affected person, through an order in writing that he would be in a position to know the violation, if any on his part, and can pursue the remedies. It has already been pointed that the 2nd respondent did not pass any orders against the petitioner, nor any provision of any law was mentioned in the show cause notice. The seizure of the equipment and sealing of bore-well cannot be sustained. Hence, the writ petition is allowed and respondents 2 and 3 are directed to handover the seized equipment and remove the seal, if any, put on the bore-well. It is, however, left open to the 2nd respondent to pass appropriate orders, duly referring to the relevant provisions of law and take further steps as provided for under the Act and the Rules made thereunder.

THE HON'BLE MR JUSTICE L.NARASIMHA REDDY          

WRIT PETITION No.17648 OF 2012  
       
30.07.2012

B.Yadagiri

District Collector, Nalgonda and others.

Counsel for petitioner: Sri G.Purushotham Reddy

Counsel for Respondents : GP for Revenue

<GIST:

>HEAD NOTE:  

?Cases referred

ORDER:
       
        The petitioner owns Acs.4.30 guntas of land in different survey numbers of
Kasarlapahad Village, Jagireddygudem Mandal, Nalgonda District.  The common
well, in which, the petitioner and the
4th respondent have 25% share, each, and one Laxmaiah has 50% share, is a source  
of irrigation.  The petitioner sunk a bore-well, in his land, in survey No.172,
in January, 2012, on finding that the water that falls towards his share from
the common well, is not sufficient to irrigate his land.
        The 4th respondent submitted a complaint, against the petitioner, to the
Tahasildar, Jagireddygudem Mandal, the 2nd respondent herein, under the A.P.
Water, Land and Trees Act, 2002 (for short 'the Act') and the Rules made
thereunder (for short 'the Rules').  A notice, dated 17.05.2012, was issued to
the petitioner, directing him to explain as to why action be not taken against
him, under the Act and the Rules.  The petitioner submitted his explanation, on
23.05.2012.  However, on 02.06.2012, the Mandal Revenue Inspector, Kasarlapahad
Village, the
3rd respondent herein, seized the starter and other equipment and made the bore-
well non-operational.  The petitioner challenges the action of the respondents 1
to 3.  He contends that the very issuance of notice is contrary to the
provisions of the Act, since the village is not notified as over-exploited under
Section 11 of the Act, nor it is pointed out that the bore-well is within the
prohibited distance from any drinking water source.  Other grounds are also
urged.
         Heard Sri G.Purushotham Reddy, learned counsel for the petitioner,
learned Government Pleader for Revenue and none appears for the 4th respondent.

The petitioner sunk a bore-well, in January 2012, in his land, in survey No.172
of Kasarlapahad Village.  Through notice, dated 17.05.2012, the 2nd respondent
required the petitioner to explain as to why, the bore-well be not seized, since
it was sunk without any permission and within a distance of 30 feet from the
existing well. The explanation submitted by the petitioner is, no doubt, not
happily worded, nor it is succinct.  Being a farmer, the petitioner seems to
have approached somebody in the locality, and he, in turn, has exhibited his
linguistic skills.  The gist of the explanation is that, the complainant i.e.,
the 4th respondent has only 25% share in the common well; that the holder of 50%
share did not make any complaint; the village is not notified as over-exploited
one, and that there is no basis for initiation of the proceedings.  The 2nd
respondent did not pass any orders, after receiving the explanation.  However,
on a direction issued by him, the
3rd respondent seized the starter and other equipment of the bore-well under a
panchanama.  Thereafter, the 2nd respondent addressed a letter, dated 06.06.2012
to the District Collector, Nalgonda, the 1st respondent, narrating the
developments and soliciting his opinion.   Therefore, it needs to be seen, as to
whether the steps taken by respondents 2 and 3 are in accordance with law.

The Act has been enacted by the A.P. State Legislature in the year 2002, with a
view to promote water conservation to regulate the exploitation of use of ground
and surface water sources, and to deal with the other matters incidental
thereto.  Chapter II provides for the constitution of the Authority under the
Act.  Chapters III and IV are devoted to conservation and protection of water
sources. Chapter V deals with the trees and Chapter VI with the miscellaneous
matters.

Section 8 mandates that with the commencement of the Act, the owners of the
wells, in the State, shall get the wells and water-bodies registered with the
Authority in a prescribed manner.  Section 9 provides for steps to preserve the
ground water levels, in general.  If, in the opinion of the Designated Officer,
the pumping of water by individuals, or organisations, in any particular area,
is likely to result in depletion of  ground water level, or damage to the
natural resources or environment, he may issue orders prohibiting such pumping
of the water, for a period not exceeding six months.  He can also issue
directions to the Transmission Corporation of A.P. not to collect the
electricity charges during that period.  The sinking of new wells, in such area,
is not allowed, when the prohibition is in force.  Section 10 of the Act is
aimed at protecting the drinking water sources.  Sub-section (1) thereof
prohibits sinking of wells within a distance of 250 metres from the existing
drinking water source.  If any person intends to sink a well within that
distance, he shall be under obligation to apply to the Designated Authority and
it is only on such permission being accorded that a well be sunk.

Section 11 of the Act empowers the Authority, on the advise of technical
experts, to declare any particular ground water basin, as defined under sub-
section (5) of Section 2, as "over exploited".  Such declaration shall be in
force for a period six months and it can be extended for a further period of not
more than six months at a time.  The parameters that are required to be taken
into account, to declare a basin as over exploited area, are indicated therein.
The Authority is also required to identify steps to improve the ground water
levels.

Section 12 has a different purpose to serve.  If an existing well is found to be
adversely affecting the public ground water source, the Authority may prohibit
extraction of water for commercial, industrial or other purposes, from such
wells within its vicinity for a period not exceeding six months and such period
can be extended thereafter.  The prohibition of extraction of water for
irrigation purposes is required to figure in the last of the priorities.  If the
situation does not improve on account of such measure, the Authority may direct
the stoppage of extraction of water and closure of wells temporarily, or
permanently.

A combined reading of these provisions, makes it clear that the sinking of a
well by an individual is prohibited,
a) when the prohibition issued by the authority under Section 9 of the Act,
against pumping of the water in respect of an area where the well is proposed to
be dug, is in force (proviso to Section 9(1));
b) when it is proposed to be sunk within a distance of 250 metres from existing
drinking water source (section 10); and
c) when it is sought to be sunk in an area,  as regards which the declaration by
the authority that it is "over exploited", is in force (section 11).

In the instant case, it is not the plea of the respondents that the Authority
has issued any declaration under Section 11 of the Act, to the effect that
Kasarlapahad Village is part of any ground water basin,  declared as "over-
exploited".  It is also not their case that the bore-well sunk by the petitioner
is within 250 metres from the existing drinking water source or that any measure
contemplated under Section 9 of the Act was initiated for the area.  Obviously
because, the officials were not sensitised properly to the provisions of the Act
and the rights of the citizens thereunder, the steps were initiated, either in
the form of issuing notice, or seizing equipment, without reference to the
relevant provisions of law, or the measures contemplated thereunder.

The Act is purely regulatory in nature.  Sinking of bore-well is not a
prohibited activity.  It is only in the process of regulation that certain
restrictions are placed, on the freedom of a citizen to sink bore-well in his
land.  Such a freedom can be curtailed, only by making reference to the relevant
provisions of law.  The situations contemplated under the Act are many, ranging
from prohibition of pumping of water from existing wells, to the one of banning
the sinking of new wells, in the area as regards which a declaration issued
under Section 11 of the Act, is in operation.  The sinking of well can be found
fault with, if only it is found to be in contravention of any particular
provision of law.  Further, it is only when the reasons are communicated to the
affected person, through an order in writing that he would be in a position to
know the violation, if any on his part, and can pursue the remedies.  It has
already been pointed that the 2nd respondent did not pass any orders against the
petitioner, nor any provision of any law was mentioned in the show cause notice.
The seizure of the equipment and sealing of bore-well cannot be sustained.
Hence, the writ petition is allowed and respondents 2 and 3 are directed to
handover the seized equipment and remove the seal, if any, put on the bore-well.
It is, however, left open to the 2nd respondent to pass appropriate orders, duly
referring to the relevant provisions of law and take further steps as provided
for under the Act and the Rules made thereunder.

        The miscellaneous petition filed in this writ petition also stands
disposed of.

        There shall be no order as to costs.
____________________  
L.NARASIMHA REDDY, J.    
Dated:30.07.2012