Supreme Court Quashes Gujarat Order Reclaiming Grazing Land from Adani Ports: Legal Analysis and Constitutional Implications

1. Background of the Dispute: Mundra Grazing Land Allotment

The Supreme Court of India has set aside a Gujarat government order reclaiming 108 hectares of grazing land allotted to Adani Ports and Special Economic Zone Ltd (APSEZ) in Mundra, Gujarat.

The dispute traces back to 2005, when the Gujarat Revenue Department and the Collector allotted approximately 231 acres of grazing land in Navinal village, Kutch district, to private entities associated with the Mundra Port project.

In 2011, a Public Interest Litigation (PIL) was filed before the Gujarat High Court challenging the land allotment, alleging improper diversion of grazing land and environmental concerns such as dredging, filling of creeks, and destruction of mangroves.

2. Supreme Court Judgment: Violation of Natural Justice

A bench comprising Justice J.K. Maheshwari and Justice Atul Chandurkar held that the Gujarat government’s July 4, 2024 order resuming 108 hectares of land was passed without granting Adani Ports an opportunity of hearing, thereby violating the principles of natural justice.

The Court observed that:

  • The state government did not hear the company before passing the resumption order.

  • The Gujarat High Court also issued consequential directions without granting adequate hearing to Adani Ports.

  • The High Court did not adjudicate the PIL on merits but merely directed implementation of the state’s decision.

The Supreme Court quashed the resumption order but granted the state liberty to pass a fresh order after following due process.

3. Directions Issued by the Supreme Court

The Supreme Court issued the following directions:

  • The July 4, 2024 resumption order was quashed.

  • The state government was directed to exchange pleadings with all parties within six weeks.

  • The state must afford a hearing to all stakeholders and decide the issue afresh expeditiously.

  • The 2011 PIL was treated as disposed of, with liberty to parties to pursue remedies after the fresh state decision.

4. Key Statutory Framework Governing the Dispute

4.1 Gujarat Land Revenue Code, 1879

  • Governs classification and allotment of government land, including grazing land (gauchar).

  • Restrictions exist on conversion of grazing land without proper procedure and public interest justification.

4.2 Special Economic Zones Act, 2005

  • Provides statutory framework for land allotment and development of SEZs.

  • Grants certain statutory rights and protections to SEZ developers once land is legally allotted.

4.3 Environmental Laws

  • Environment (Protection) Act, 1986

  • Coastal Regulation Zone (CRZ) Notifications

  • Forest Conservation Act, 1980 (if mangroves qualify as forest land)

The PIL had raised environmental concerns related to these statutes.

5. Constitutional Provisions Involved

Article 14 – Equality Before Law

Administrative actions must be non-arbitrary, fair, and reasonable. Passing an order without hearing violates Article 14.

Article 21 – Right to Life and Due Process

The Supreme Court has read procedural fairness into Article 21. Administrative decisions affecting civil and property rights must follow due process.

Article 300A – Right to Property

No person shall be deprived of property save by authority of law. Arbitrary deprivation without procedure violates Article 300A.

6. Doctrine of Natural Justice

The Court relied on the fundamental principle:

  • Audi alteram partem – no person shall be condemned unheard.

Failure to grant a hearing renders an administrative order void.

7. Judicial Precedents on Natural Justice and Administrative Fairness

A.K. Kraipak v. Union of India (1969)

Established that administrative decisions affecting rights must follow principles of natural justice.

Maneka Gandhi v. Union of India (1978)

Expanded Article 21 to include procedural fairness and non-arbitrariness.

Mohinder Singh Gill v. Chief Election Commissioner (1978)

Held that orders must stand or fall on reasons given and must follow fair procedure.

State of Orissa v. Dr. (Miss) Binapani Dei (1967)

Confirmed that even administrative orders affecting civil consequences require a hearing.

K.T. Plantation Pvt Ltd v. State of Karnataka (2011)

Clarified scope of Article 300A and protection of property rights.

8. PIL Jurisprudence and Limits of Judicial Directions

The case also raises issues on the scope of PILs and judicial directions affecting third-party rights.

Key Precedent

State of Uttaranchal v. Balwant Singh Chaufal (2010)
The Court cautioned against misuse of PILs and stressed procedural safeguards when third-party rights are affected.

The Supreme Court noted that the PIL was 13 years old and involved land allotment decisions made over two decades ago, thereby requiring heightened procedural caution.

9. Adani Ports’ Legal Arguments

Adani Ports argued:

  • The resumption order was inherently illegal due to violation of natural justice.

  • The High Court could not enforce an illegal executive order.

  • The company had invested ₹23,586 crore by 2011 and generated significant employment.

  • Vested statutory rights accrued over 20 years could not be disturbed summarily.

10. Vested Rights and Legitimate Expectation Doctrine

Relevant Precedents

  • Navjyoti Co-operative Group Housing Society v. Union of India (1992) – Doctrine of legitimate expectation recognized.

  • Union of India v. Hindustan Development Corporation (1993) – State actions must respect legitimate expectations arising from consistent practice.

Long-term investments and statutory approvals strengthen vested rights claims.

11. Environmental and Public Interest Considerations

The original PIL sought:

  • Restoration of grazing land to the gram panchayat.

  • Provision of alternative grazing land.

  • Halt on dredging and mangrove destruction pending environmental clearance.

This reflects the constitutional mandate under:

Article 48A

State shall protect and improve the environment.

Article 51A(g)

Citizens have a duty to protect the environment.

12. Implications of the Supreme Court Ruling

For Administrative Law

  • Reinforces that procedural fairness is non-negotiable.

  • Executive actions affecting corporate and property rights require hearings.

For Land Governance

  • States cannot reclaim land arbitrarily, even in public interest.

  • Due process and statutory compliance are mandatory.

For PIL Jurisprudence

  • Courts must ensure third-party rights are not curtailed without hearing affected parties.

13. Conclusion

The Supreme Court’s ruling underscores a fundamental constitutional principle: even the State must follow due process when reclaiming land.

While public interest and environmental protection remain vital, administrative fairness and property rights cannot be sacrificed. The decision reiterates that natural justice is not a procedural formality but a constitutional mandate.

The Gujarat government now has the liberty to reconsider the resumption decision, but only after a legally compliant process involving all stakeholders.

Location: Pune, Maharashtra, India

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