State of Andhra Pradesh and Others vs Dr. Rao, V.B.J. Chelikani and Others

Held: GoM Nos. 243 and 244 dated 28.02.2005 quashed to the extent they classify MPs, MLAs, officers of the AIS/State Government, Judges of the Constitutional Courts, and journalists as a separate class for allotment of land at the basic rate – GoM Nos. 419, 420, 422 to 425 dated 25.03.2008, and GoM No. 551 dated 27.03.2008, declared bad in law, being violative of Art.14 – Allocation of land at basic rates to select privileged groups reflects a “capricious”, “irrational” and arbitrary approach – This policy of the State Government, is an abuse of power meant to cater exclusively to the affluent sections of the society, disapproving and rejecting the equal right to allotment of the common citizen and the socioeconomically disadvantaged – Doctrine of manifest arbitrariness is applicable – Government servants, elected legislators, Judges in the Supreme Court and High Court, and prominent journalists do not belong to the “weaker” or per se deserving sections of the society, warranting special State reservations/preferential treatment to land allotment – When the government allocates land at discounted rates to the privileged few, it engenders a system of inequality, conferring upon them a material advantage that remains inaccessible to the common citizen – This preferential treatment conveys practices foster resentment and disillusionment among ordinary citizens, who perceive these actions as corrupt or unjust, thereby eroding trust in democratic institutions – This policy undermines solidarity and fraternity, reinforcing societal hierarchies rather than actively working to dismantle them – When land is offered at a discounted rate, it distorts the natural market forces that govern the value of land – This has severe financial ramifications for the public exchequer – Furthermore, the accredited journalists cannot be treated as a separate class for such preferential treatment – Core framework of these policies suffers from the malaise of unreasonableness and arbitrariness – It reeks of colourable exercise of power whereby the policymakers are bestowing valuable resources to their peers and ilk, triggering a cycle of illegal distribution of State resources – Allotment policy fails to satisfy the requirements of the two-pronged classification test coupled with arbitrariness – To test the facts against the standards of substantive equality, the Judges of the Supreme Court and the High Court, MPs, MLAs, officers of the AIS, journalists etc. cannot be treated as a separate category for allotment of land at a discounted basic value in preference to others – Order of restitution passed and Cooperative Societies and their members, entitled to refund of the entire amount deposited by them, including stamp duty and registration fee, development charges/expenses paid by them, along with interest – Constitution of India – Art.14. [Paras 76, 77, 79, 80-83, 85-92, 94] Code of Civil Procedure, 1908 – s.11 – Res Judicata and constructive Res Judicata – Applicability – Plea of the Cooperative Societies and its members that the principle of res judicata and constructive res judicata would apply to the instant case:

Held: Res judicata will not apply, as the previous judgment did not examine the constitutional validity of GoM Nos. 243 and 244 – GoM Nos. 420, 422 to 425 dated 25.03.2008 had not been issued at the time the said judgment was pronounced and hence, could never have been challenged – Plea of the Cooperative Societies that the principle of constructive res judicata should apply to the examination of the challenge to GOM Nos. 243 and 244, cannot be accepted – Principles of constructive res judicata should not have been applied, given the significant public interest at stake – Once the allotments were cancelled and the writ petition was allowed, the State had the opportunity to re-evaluate the entire issue in light of the findings recorded – Members of the public cannot be restrained in filing writ petition challenging GoM Nos. 243 and 244 – Constructive res judicata applies only when the cause of action is identical – Causes of action in the two litigation proceedings should not be considered identical, as the first litigation focused on the allotment and its terms and conditions – GoM Nos. 243 and 244 are separate and distinct from the allotment itself, and challenging these notifications constitutes a separate and independent cause of action. [Paras 35, 38, 39]

Constitution of India – Art.14 – Equality before law – Test of reasonable classification – Concept of substantive equality – Substantive equality test – Explained. [Paras 48, 52, 56, 59, 67, 68, 73, 74]