State Of Rajasthan vs Rajasthan Leather Industries Ltd on 30 April, 2026

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    Rajasthan High Court – Jaipur

    State Of Rajasthan vs Rajasthan Leather Industries Ltd on 30 April, 2026

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                 HIGH COURT OF JUDICATURE FOR RAJASTHAN
                                    BENCH AT JAIPUR
                            D.B. Special Appeal Writ No. 850/2025
                                                  In
                            S.B. Civil Writ Petition No.14646/2021
    
    Rajasthan Leather Industries Ltd., Having Its Registered Office At Pucca
    Bandha, Tonk Through Its Authorized Signatory Chairman Cum Managing
    Director, Shri Deepak Saini Son Of Shri Chotey Lal Saini, Aged About 37
    Years, R/o 690, Bhola Nagar, Kotla Mubarakpur, New Delhi- 110003
                                                                                   ----Appellant
                                               Versus
    1.        State Of Rajasthan, Through Principal Secretary To Government,
              Revenue Department, Government Secretariat, Jaipur.
    2.        Secretary, Department Of Industries, Government Secretariat,
              Jaipur.
    3.        Secretary, Public Enterprises, Jaipur
    4.        Commissioner, Industries, Government Of Rajasthan, Jaipur
    5.        Tehsildar, Tonk.
                                                                                ----Respondents
                                        Connected With
                            D.B. Special Appeal Writ No. 168/2026
                                                  In
                            S.B. Civil Writ Petition No.14646/2021
    1.        State Of Rajasthan, Through Principal Secretary To Government,
              Revenue Department, Government Secretariat, Jaipur.
    2.        Secretary, Department Of Industries, Government Secretariat,
              Jaipur.
    3.        Secretary, Public Enterprises, Jaipur
    4.        Commissioner, Industries, Government Of Rajasthan, Jaipur
    5.        Tehsildar, Tonk.
                                                                                  ----Appellants
                                               Versus
    Rajasthan Leather Industries Ltd., Having Its Registered Office At Pucca
    Bandha, Tonk Through Its Authorized Signatory Chairman Cum Managing
    Director, Shri Deepak Saini Son Of Shri Chotey Lal Saini, Aged About 37
    Years, R/o 690, Bhola Nagar, Kotla Mubarakpur, New Delhi- 110003
                                                                                ----Respondent
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           For Appellant(s)           :    Mr. Kamlakar Sharma, Sr. Adv.
                                           assisted by Ms. Alankrita Sharma
           For Respondent(s)          :    Mr. G.S. Gill, AAG assisted by
                                           Ms. Shikha Sharma, AAAG and
                                           Ms. Rashmi Kaushik
                                           Mr. Basant Singh Chhaba, AAG
                                           assisted by Mr. Hardik Singh and
                                           Ms. Mansi Sharma
                                           Mr. S.S. Naruka, AAG assisted by
                                           Mr. Sachin Singh Rathore and
                                           Mr. Anshuman Singh
    
    
    
        HON'BLE THE ACTING CHIEF JUSTICE MR. SANJEEV PRAKASH SHARMA
                      HON'BLE MRS. JUSTICE SHUBHA METHA
    
                                          Judgment
    
            Date of conclusion of arguments                  :                24/03/2026
    
            Date on which judgment was reserved :                             24/03/2026
    
            Whether the full judgment or only
            the operative part is pronounced                :                 Full judgment
    
            Date of pronouncement                           :                 30th/04/2026
    
    (Per Hon'ble The Acting Chief Justice)
    
    REPORTABLE
    
    Facts
    1. By way of the present special appeals (writs), Rajasthan Leather
    
    Industries Limited and the state government assailed the order dated
    
    12.05.2025 passed by the learned Single Judge, whereby the writ petition
    
    preferred by the appellant-company (writ petitioner) was partly allowed.
    
    The writ petition came to be disposed of by the learned Single Judge with
    
    the following observations:
    
             "11.Considering the aforesaid material aspect of the
             matter so also the opinion given by the Advocate
             General as well as the subsequent decision taken by the
             Ministry of the concerned Department, the instant writ
             petition stands disposed of granting liberty to the
             petitioner to use and develop land in question for the
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             purpose of establishing Agro Based Food Park. The
             petitioner would be at liberty to diversify its portfolio
             but the petitioner would not be allowed to sale/alienate
             the property in question without permission of the
             respondents.
             12. In case, the petitioner feels aggrieved by any of the
             actions of the respondent-State, the petitioner would be
             at liberty to approach the Arbitrator for settlement of
             dispute in terms of the agreement dated 12.11.1992.
             13.Stay application as well as all applications (pending,
             if any) stand disposed of.
    
    
    2. While the learned Single Judge permitted the appellant to diversify his
    
    business by setting aside the restriction imposed in that regard, the other
    
    condition restraining the appellant from selling or alienating the property in
    
    question was maintained and the appellant has been precluded from selling
    
    or otherwise alienating the said property without prior permission of the
    
    respondents.
    
    3. The facts relevant for the adjudication of the present appeal are that the
    
    state government acquired the land ad measuring 193 bighas vide order no
    
    1595 dated 31.07.1971 under the Rajasthan Land Acquisition Act 1953 for
    
    industrial   purposes   for   M/s     Rajasthan         State      Tanneries   which    was
    
    incorporated on 22.11.1971 as a State Government undertaking under the
    
    Companies Act, 1956 having initial authorised capital of Rs 1,00,00,000/-
    
    divided in 10 lakhs equity shares of Rs 10 each. The certificate of
    
    incorporation number 1381 of 1971/72 was issued by the Registrar of
    
    Companies. Upon acquisition, the possession of the entire land was handed
    
    over to the government company as per the certificate dated 16.10.1973
    
    issued by the office of the Collector, Tonk. The land was entered in revenue
    
    records in the namer of M/s Rajasthan State Tanneries Limited in the year
    
    1977. Subsequently, M/s Rajasthan State Tanneries Limited ceased its
    
    operations as it ran into continued losses. Accordingly, the sate government
    
    by cabinet approval dated 17.05.1988 took a decision to privatise the
    
    
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    company by transfer of entire shareholding and invited tender in this
    
    regard. The state government issued the tender notice in the year 1992 for
    
    change of management by transfer of shareholding.
    
    4. Notably, Clause (j) of the said agreement expressly entitled the writ
    
    petitioner to diversify and expand its business activities, with the object of
    
    promoting the growth of the company and generating employment
    
    opportunities.
    
    5. Despite repeated requests made by the writ petitioner, the land in
    
    question continued to remain recorded in the name of Rajasthan State
    
    Tanneries Ltd. as agricultural land even after it being transferred to the writ
    
    petitioner company.
    
    6. Thereafter, a meeting was convened on 13.06.2008, which was chaired
    
    by the Hon'ble Industries Minister. The writ petitioner objected to the
    
    certain decisions which were taken in the said meeting as being wholly
    
    illegal, which subsequently led to the filing of the writ petition by the
    
    petitioner. In the meeting, the following decisions were taken:
    
             "(1) Unit representative would submit detailed project
             report to the Industries Department within seven days.
    
             (2) Detailed action plan report of the proposed project
             in which it should be disclosed that in how much days
             collective Mechanized Automatic Animal Slaughtering
             House would be established and production would be
             started.
    
             (3)   Issuance   of   no    objection    certificate for
             establishment of slaughtering house should be ensured
             from Municipal authorities and Pollution Control Board.
    
             (4) Permission from Revenue Department, Government
             of Rajasthan should be obtained to use the land for
             industrial purposes should be obtained as the land of
             State Tanneries is recorded in the name of State
             Government i.e. Rajasthan State Tanneries Ltd.
    
             (5) Permission to sell the above said land would not be
             granted by the State Government and permission
             would be obtained to use the land for commercial
             purposes. With the conditions NOC should be granted
             to open mutation in the name of Tonk Tanneries Ltd."
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    7. Mutation of the land in favour of the writ petitioner and its conversion
    
    from agricultural to non-agricultural use became necessary as The failure to
    
    effect the conversion created substantial impediments for the writ
    
    petitioner company in carrying on its business operations. However, despite
    
    repeated requests, no steps were taken by the concerned authorities in this
    
    regard.
    
    8.   Vide   letter   dated   05.03.2009,        the     Principal         Secretary,   Revenue
    
    Department directed the District Collector, Tonk, to record the land in the
    
    name of the writ petitioner company. Pursuant thereto, the District
    
    Collector, Tonk, vide communication dated 02.04.2009, directed the
    
    Tehsildar to take necessary steps in this regard. Consequently, the Patwari
    
    sanctioned the mutation in favour of the writ petitioner company.
    
    9. However, while effecting such mutation, two conditions/restrictions,
    
    namely, (i) restriction on diversification of business, and (ii) restriction on
    
    sale/alienation of the land, were imposed, which were without authority of
    
    law and in clear violation of original agreement as at the time of transfer no
    
    such conditions existed.
    
    10. The writ petitioner also obtained a legal opinion from Hon'ble Justice
    
    B.P. Singh, former Judge of the Supreme Court of India, wherein it was
    
    opined that the aforesaid conditions were without any legal authority.
    
    Thereafter, several further representations, the matter was referred to the
    
    learned Advocate General, who, vide opinion dated 22.02.2012, also opined
    
    that the restrictions imposed on the use of land were not supported by law,
    
    particularly in light of Sections 10 and 11 of the Transfer of Property Act,
    
    1882, and Section 133 of the Rajasthan Land Revenue Act, 1956.
    
    11. That on 21.05.2015, one of the Directors of the writ petitioner company
    
    submitted a representation to the Hon'ble Revenue Minister assailing the
    
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    aforesaid arbitrary conditions. Pursuant thereto, a report was called for
    
    from the District Collector, Tonk, vide communication dated 30.07.2015.
    
    The District Collector, in turn, sought a report from the Sub-Divisional
    
    Officer, who directed the Tehsildar to furnish a factual report.
    
    12. In compliance thereof, the Tehsildar submitted a report stating that the
    
    land stood duly mutated in the name of Tonk Tanneries, and made
    
    reference to letters dated 05.03.2009 and 20.03.2009, which did not
    
    stipulate any such conditions. However, in the covering letter dated
    
    07.12.2015, reliance was placed upon an alleged order dated 02.04.2009
    
    as the basis for imposing the aforesaid restrictions, purportedly in the
    
    interest of the State. After this several other representations were also
    
    submitted.
    
    13. That one of the Directors of the writ petitioner company submitted an
    
    application under Section 90A of the Rajasthan Land Revenue Act, 1956 on
    
    01.03.2019 seeking permission for establishment of an Agro Food Park.
    
    Pursuant thereto, the Commissioner, Nagar Parishad, Tonk, vide letter
    
    dated 02.08.2019, informed the Director, Local Bodies, that the subject
    
    land had been earmarked for industrial use in terms of the Master Plan,
    
    2031. Thereafter, the Chief Town Planner approved the layout plan on
    
    16.08.2019, which was subsequently approved by the Nagar Parishad in its
    
    SPC meeting held on 18.09.2019.
    
    14. In furtherance thereof, the writ petitioner submitted a representation
    
    dated 17.09.2019 to the Commissioner, Industries, seeking issuance of No
    
    Objection Certificate and approval of the project. The Commissioner,
    
    Industries, vide communication dated 09.10.2019, sought a report in the
    
    matter, wherein it was reiterated that the land was not subject to any such
    
    restrictions.   The     Nagar    Parishad        also     supported         the   proposal   by
    
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    recommending issuance of separate pattas and requested approval for
    
    establishment of the agro-based industry.
    
    15. As the conditions were imposed at ministerial level, the matter was
    
    again placed before the Minister for removal of the conditions. However, no
    
    decision was taken.
    
    16.   Consequently,        after    exhausting           all    available      remedies     and
    
    representations,        which   yielded     no     result,      the     writ   petitioner   was
    
    constrained to file the writ petition, being aggrieved by the inaction of the
    
    State authorities as well as the illegal and arbitrary conditions imposed by
    
    the State Government, including the endorsement made by the Patwari in
    
    the revenue records.
    
    Arguments
    A. Submissions on Behalf of Appellant
    17. It is submitted on behalf of the appellants that the learned Single Judge
    
    failed to properly appreciate that the writ petitioner company was
    
    aggrieved by the manifest illegality, arbitrariness, and colourable exercise
    
    of power on the part of the respondents, whereby conditions restraining the
    
    writ petitioner from sale/alienation of the land as well as from diversifying
    
    its business were imposed. The said conditions, having been incorporated
    
    in the revenue record by the Patwari at the instance of the Minister, were
    
    wholly without jurisdiction and beyond the authority vested in the Patwari
    
    as well as the State Government. It is further submitted that the specific
    
    challenge in the writ petition was to the lack of authority in law of the
    
    respondents to impose such conditions; however, merely on account of the
    
    fact that, during the pendency of the writ petition, the restriction pertaining
    
    to diversification was relaxed by the Minister, the learned Single Judge
    
    proceeded to dispose of the writ petition without adjudicating upon the
    
    
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    validity and legality of the remaining condition restraining sale/alienation of
    
    the property, which continues to operate to the prejudice of the appellants.
    
    18. It is further submitted that the learned Single Judge erred in observing
    
    that the petitioner would not be permitted to sell or alienate the property in
    
    question    without     prior   permission         of    the     respondent-State,   which
    
    observation is ex facie contrary to settled principles of law. The learned
    
    Advocate General, in his opinion, had categorically opined that the
    
    transferee is entitled to enjoy the property without any such restrictions, in
    
    view of Sections 10 and 11 of the Transfer of Property Act, 1882. It is
    
    submitted that the restrictions imposed at the instance of the Minister, and
    
    subsequently reflected in the revenue record, are not traceable to any
    
    statutory provision and are wholly without authority of law; consequently,
    
    the continuation and endorsement of such restrictions is arbitrary, illegal,
    
    and liable to be set aside. Furthermore, It is being vehemently argued by
    
    the appellant that company has not fulfilled or discharged its liabilities, and
    
    it is also denied that company remained non functional for 33 years and
    
    because of imposition of two arbitrary conditions, the company was not
    
    able to to set up any commercial business as permission had to be taken
    
    from State Government but the State government did not approve any of
    
    the requests. Initially also tannery was being run by the appellant for 4
    
    years till the area got marked as a green belt and only eco friendly industry
    
    was allowed to bet established. Also, the imposition of conditions by the
    
    respondent state was neither statutory or policy-based and the transfer
    
    was not an allotment or a grant, it was a full fledged transfer of ownership
    
    by transfer of 100% shareholding which was approved by Cabinet vide
    
    order no. 169/94 dated 6/10/1994. It is also submitted that decision of the
    
    Hon'ble minister regarding establishment of Agro-food park was drawn on
    
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    3.8.23 and the file was sent to Additional Chief Secretary, Industries
    
    Department for passing necessary orders for implementation of the orders
    
    of Hon'ble Minister but the additional Chief Secretary did not pass any
    
    order and thereafter the note sheet annexed by the respondents in their
    
    reply was drawn which seems to be be malafide and motivated.
    
    19. It is submitted that the learned Single Judge failed to appreciate that
    
    upon complete transfer of ownership, the State Government had divested
    
    itself of all rights, title, interest, and management control over the
    
    property, and therefore had no authority or justification to impose any
    
    conditions subsequently in the year 2008, particularly after having divested
    
    itself of all liabilities as early as in the year 1995. It is further submitted
    
    that even assuming, without admitting, that such conditions had been
    
    imposed at the time of transfer, the same would, in any event, be void and
    
    unenforceable in view of Sections 10 and 11 of the Transfer of Property Act,
    
    1882, which prohibit imposition of absolute restraints on alienation and
    
    enjoyment of property.
    
    20. It is submitted that the imposition of the aforesaid restrictions is wholly
    
    arbitrary and contrary to the binding terms of the agreement dated
    
    12.11.1992, pursuant to which the State Government transferred 100%
    
    shareholding of the undertaking, and the subsequent approval of the
    
    Cabinet dated 06.10.1994 culminated in complete privatization and
    
    cessation of all control of the State Government over the said entity. It is
    
    further submitted that the writ petitioner entered into the agreement on
    
    the basis of express contractual terms, which did not envisage or impose
    
    any restriction on the future use, diversification, or alienation of the
    
    property. The subsequent imposition of such conditions, dehors the
    
    agreement, defeats the legitimate expectation of the writ petitioner and
    
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    amounts to a unilateral alteration of contractual terms, thereby violating
    
    the well-settled doctrine of sanctity of contract. It is also submitted that no
    
    retrospective conditions could have been imposed at the stage of mutation
    
    entries, which are merely fiscal in nature and do not confer or alter
    
    substantive rights, and therefore the impugned action of imposing
    
    restrictions at such a stage is wholly illegal and unsustainable in the eyes of
    
    law.
    
    21. It is further submitted that the selective and discriminatory imposition
    
    of the aforesaid restrictions upon the writ petitioner, while similarly situated
    
    entities have not been subjected to such conditions, is arbitrary and
    
    violative of Article 14 of the Constitution of India, as the impugned action
    
    lacks any reasonable classification or intelligible differentia and does not
    
    bear any rational nexus with the object sought to be achieved. It is
    
    submitted that the imposition of the aforesaid conditions at the stage of
    
    mutation is contrary to the provisions of the Rajasthan Land Revenue Act,
    
    1956, which do not confer any power upon the State Government or its
    
    authorities to impose substantive conditions while effecting changes in
    
    revenue records, as mutation proceedings are merely fiscal in nature and
    
    intended for recording possession and title for revenue purposes, and
    
    cannot be utilised as a mechanism to alter or curtail substantive rights.
    
    22. It is further submitted that the learned Single Judge erred in relegating
    
    the petitioner to the remedy of arbitration, despite the fact that the
    
    arbitration clause contained in the agreement is limited in its scope to
    
    disputes arising under or in relation to the terms of the said agreement.
    
    The present dispute does not emanate from any contractual disagreement
    
    between the parties, but rather pertains to the imposition of arbitrary and
    
    illegal conditions by the respondents dehors the agreement, and therefore
    
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    the direction to avail the remedy of arbitration is misconceived and
    
    unsustainable, as the controversy raised is essentially one involving the
    
    exercise of statutory and constitutional powers by the State authorities,
    
    which cannot be adjudicated within the confines of a contractual arbitration
    
    clause.
    
    23. It is submitted that the learned Single Judge committed a manifest
    
    error in law in failing to adjudicate upon the validity and legality of the
    
    condition restraining alienation of the property, despite the same being
    
    specifically challenged in the writ petition, and without undertaking any
    
    analysis or assigning reasons, proceeded to observe that the writ petitioner
    
    would not be permitted to sell or alienate the property. Such an
    
    observation, rendered without any reasoned consideration, is contrary to
    
    settled principles of law and vitiates the impugned order, as it effectively
    
    upholds a restriction affecting valuable proprietary rights without examining
    
    its legality or the authority under which it was imposed.
    
    24. Lastly, it is submitted that the writ petitioner has been consistently
    
    deprived of its right to utilise its own land for lawful industrial purposes,
    
    and the continued and unjustified refusal on the part of the State
    
    Government has the effect of amounting to a constructive expropriation of
    
    the petitioner's property rights. Such action, though not amounting to
    
    formal acquisition, effectively strips the petitioner of the beneficial use and
    
    enjoyment of its property, and is therefore ex facie violative of the
    
    petitioner's constitutional right to property guaranteed under Article 300A
    
    of the Constitution of India, as no person can be deprived of property save
    
    by authority of law, which is wholly absent in the present case.
    
    25. In support of his submissions, learned counsel cited the following
    
    judgements:
    
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          (I) Sawarni vs Inder Kaur and Others.1
          (II) Jitendra Singh vs State of Madhya Pradesh and Ors. 2
          (III) Western Coalfields Ltd vs Special Area Development
          Authority, Korba and Another3
          (IV) Heavy Engineering Mazdoor Union vs State of Bihar and
          Ors.4
          (V) Rustom Cavasjee Cooper vs Union of India5
    
    
    B. Submissions on Behalf of the Respondents
    26. Learned counsel for the respondents submits that all the allegations,
    
    averments, contentions, and assertions made in the writ petition are
    
    emphatically denied. It is submitted that the present writ petition has been
    
    preferred by the petitioner being aggrieved by the decision taken in the
    
    meeting dated 13.06.2008, chaired by the Hon'ble Minister, as well as the
    
    conditions       subsequently     incorporated          in    the     mutation    order    dated
    
    02.04.2009; however, the said actions are in accordance with law and do
    
    not warrant any interference by this Hon'ble Court. Furthermore, it is
    
    submitted that neither were the decisions arbitrary but rather were taken
    
    to ensure compliance with the original agreement dated 12.11.1992 and to
    
    protect the purpose for which the land, originally owned by a state
    
    enterprise,      was      transferred   and      that     the    conditions      imposed   were
    
    necessary corollaries to the overall objective of disinvestment, i.e., the
    
    revival of the closed unit and providing employment to the local residents.
    
    This decision was also necessitated by the non-compliance of the appellant
    
    to the contractual terms. Therefore, the grant of NOC for mutation was
    
    conditional upon adherence to these conditions and the transfer of land was
    
    not an outright sale but rather a conditional transfer of land for public
    
    
    1   1996 (6) SCC 223
    2   2021 SCC OnLine 802
    3   (1982) 1 SCC 125
    4   (1969) 1 SCC 765
    5   (1970) 1 SCC 248
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    purpose (for which bar on alienation was necessary to ensure that the
    
    same was not alienated without meeting the public purpose for which it
    
    was transferred). Furthermore, such restrictions would not fall foul of
    
    Section 10 of the Transfer of Property Act 1882 since these conditions are
    
    not one placed by the transferor but are statutory restrictions and
    
    consequence of non-compliance with the terms of the original allotment as
    
    well as the Rajasthan Land Revenue Act 1956. Therefore, such public law
    
    restrictions fall outside the ambit of the private law principle enshrined
    
    under Section 10 of the Act of 1882. Section 11 of the said act is also
    
    inapplicable         here        as   any    restrictions        or     enforcement     action   is
    
    legislative/executive and not a private contractual restraint. In this regard,
    
    they have relied on a decision of the Apex Court in The State of
    
    Telangana and Others vs Dr. Pasupuleti Nirmala Hanumantha Rao
    
    Charitable Trust6 wherein it was held as under:
    
                 "23. This Court is of the view that the Appellant-State
                 had allotted land to public trust for public purpose. In
                 such a situation, the State cannot be put in the normal
                 classical inter vivos party's position as public interest is
                 supreme and must prevail. This Court is also of the
                 opinion that Rules, 1975 and the Board of Revenue
                 Standing Orders operate in a completely distinct space
                 and are not eclipsed by Section 10 of the TPA."
    
    27. It is further submitted that as per the Jamabandi of revenue village
    
    Mehganv for the Samvat years 2071-2074, Khasra No. 296 measuring
    
    48.3974 hectares, situated at Village Mehganv, Patwar Halka Dhola Kherda,
    
    Tehsil Tonk, District Tonk, stands recorded in the name of M/s Tonk
    
    Tanneries Pvt. Ltd. (now Rajasthan Leather Industries Ltd.), and the
    
    revenue entries clearly stipulate that the land cannot be sold without prior
    
    permission of the State Government and that any commercial or other use
    
    would require approval from the competent authority. It is also reflected
    
    that the nature of the land is recorded as Ghair Mumkin Naala, Ghair
    6   Civil Appeal No. 5321/2025
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    Mumkin Chahi, Ghair Mumkin Paal, Ghair Mumkin Road, Ghair Mumkin
    
    Rasta, and Ghair Mumkin Tanneries, which itself justifies regulatory
    
    oversight and control. It is submitted that Mutation Order No. 652 came to
    
    be passed strictly in compliance with Order No. 1338 dated 02.04.2009
    
    issued by the District Collector, Tonk, as well as the corresponding order
    
    passed by the Tehsildar, Tonk, and therefore the mutation entries were
    
    effected in due compliance of lawful directions issued by competent
    
    authorities and cannot be said to be arbitrary or without jurisdiction. It is
    
    further   submitted          that     the     Deputy         Secretary          (State    Enterprises
    
    Department) had written to the district collector, Tonk to save the assets of
    
    Rajasthan State Tanneries Ltd. from being destroyed. The letter mentioned
    
    that the company was not make any efforts to re-established the
    
    manufacturing unit but rather efforts were made to destroy the land, plants
    
    and assets of this unit. Therefore, the letter requested ensuring that the
    
    present management does not sell this land to anyone, does not use it for
    
    any work except leather work, there is no change in the revenue record
    
    and the assets arent destroyed. In this regard, the opinion given by the
    
    Advocate General is advisory in nature and cannot supersede decisions
    
    taken by the government.
    
    28. Learned counsel further submits that, as a matter of fact, no tannery or
    
    any industrial activity is presently being carried out on the subject land,
    
    and in the absence of any ongoing industrial use, the petitioner cannot
    
    claim that any immediate or irreparable prejudice has been caused so as to
    
    invoke the extraordinary jurisdiction of this Hon'ble Court. The objective
    
    behind the transfer of the land was the revival of the sick industrial unit,
    
    re-establishment        of    dairy     operations         and     ensuring        employment       to
    
    retrenched or displaced workers. However, the appellant failed to revive the
    
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    unit and provide employment, nor have they invested any funds towards
    
    restarting the operations. Furthermore, it is submitted that the industry
    
    was not functional for over 33 years. Owing to such non-compliance, the
    
    state government could not transfer its remaining equity as per the MoU.
    
    The failure of the appellant to fulfil the conditions of the MoU means it
    
    never took full effect. In this regard the defense of Coivd-19 taken for non-
    
    performance of contractual obligations is invalid as such non-performance
    
    substantially predates the pandemic.
    
    29. Learned counsel further submits that the land was exclusively acquired
    
    for industrial purpose. While the petitioner was permitted to diversify its
    
    operations as per the agreement dated 12.11.1992, this was intended to
    
    facilitate the expansion of industrial activities, primarily related to leather
    
    and associate products and to generate employment for the local
    
    population. This permission to diversify does not allow the petitioner to sell
    
    or alienate the land which would defeat the purpose of original acquisition
    
    of land. In this regard, it is also submitted that the Nagar Parishad's
    
    jurisdiction is limited to physical planning aspects and such approval cannot
    
    supersede the superior contractual and administrative conditions imposed
    
    by the state government at the time of conditional land transfer.
    
    30. Learned counsel also submits that while the land was erroneously
    
    recorded as agricultural, this was a defect in the revenue records. It is
    
    submitted that the land was acquired for and transferred as industrial land
    
    and that the request for conversion was merely a step to rectify the
    
    administrative error in the revenue records. The erroneous entry does not
    
    grant the petitioner the right to utilize the land for non-industrial purposes
    
    or to sell or alienate it, which remains contrary to the initial acquisition and
    
    subsequent agreement conditions. Further, it is submitted that the fact that
    
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    the land was recorded as agricultural land despite being used for industrial
    
    purposes necessitated the petitioner to undertake proper procedure for
    
    conversion of land use from agricultural to non-agricultural (as outlined by
    
    the Commerce Department's letter dated 30.06.2008). Mutation and land
    
    use conversion are separate statutory processes and the petitioner failed to
    
    complete the latter as per the relevant rules. It is further submitted that
    
    revenue records (including entry of mutation) carry a presumption of
    
    correctness unless successfully rebutted in a manner prescribed by law,
    
    which the appellant has failed to do.
    
    31. Learned counsel further submits that disputes involving a public law
    
    element and exercise of sovereign or administrative power are not arbitrate
    
    under the Arbitration and Conciliation Act 1996. This is because, an
    
    arbitrator, being a creature of contract and private law, cannot decide
    
    issues requiring the interpretation and enforcement of constitutional or
    
    public mandates such as the validity of administrative action or the
    
    correction of state revenue records. The proper forum for such challenge is
    
    through a writ court or the specific revenue courts/authorities established
    
    by statute.
    
    32. Learned counsel also submits that deprivation of property was strictly
    
    in accordance with law as mandated by article 300A and was done under
    
    the authority of acts like The Land Acquisition Act 1894, Companies Act
    
    2013, SICA. The objections of the interested parties were heard and duly
    
    disposed of.
    
    33. Learned counsel further submits that this Hon'ble Court, while
    
    exercising jurisdiction under Article 226 of the Constitution of India, is
    
    guided by well-settled self-imposed limitations and does not ordinarily
    
    undertake an elaborate fact-finding exercise, and the issues raised by the
    
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    petitioner involve disputed questions of fact which require detailed
    
    examination of evidence and are therefore not amenable to adjudication in
    
    writ   jurisdiction.    Furthermore,      owing      to    the     above-mentioned   non-
    
    compliance with the foundational terms of the MoU.
    
    34. It is further submitted that an efficacious and alternative statutory
    
    remedy is available to the petitioner for redressal of its grievances, and
    
    without exhausting such remedies, the petitioner has directly approached
    
    this Hon'ble Court, which is impermissible in law; on this ground alone, the
    
    writ petition deserves to be dismissed. Learned counsel submits that the
    
    petitioner has failed to establish its locus standi to maintain the present
    
    writ petition, as sufficient documentary evidence has not been placed on
    
    record to substantiate its claim of ownership or entitlement over the land in
    
    question, and at the same time the petitioner seeks to challenge the
    
    conditions attached thereto, which is an inconsistent stand not permissible
    
    in law.
    
    35. It is submitted that the contention of the petitioner regarding violation
    
    of Article 14 is wholly misconceived, as it is a settled principle that absolute
    
    equality is neither practicable nor required, and so long as the classification
    
    adopted by the State is reasonable and based on intelligible differentia
    
    having a rational nexus with the object sought to be achieved, the same
    
    cannot be interfered with in exercise of writ jurisdiction. It is further
    
    submitted that the conditions imposed upon the land are in furtherance of
    
    public interest and regulatory requirements, and the State is well within its
    
    powers to regulate the use and transfer of land in larger public interest; the
    
    petitioner cannot claim unfettered rights contrary to such regulatory
    
    framework.
    
    
    
    
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    36. It is also submitted that the jurisdiction under Article 226 of the
    
    Constitution is extraordinary and discretionary in nature and is to be
    
    exercised sparingly, and this Hon'ble Court does not sit as an appellate
    
    authority to correct mere errors of fact or law unless there is manifest
    
    illegality or gross injustice, which is conspicuously absent in the present
    
    case. It is submitted that there is no violation of any fundamental right or
    
    statutory provision as alleged by the petitioner, and the actions of the
    
    respondents are in consonance with law and have been taken after due
    
    consideration of the material available on record, and therefore cannot be
    
    termed as arbitrary or illegal.
    
    37. Learned counsel reiterates that the petitioner was under a legal
    
    obligation to first avail the alternative remedies available under the
    
    statutory framework before invoking the writ jurisdiction of this Hon'ble
    
    Court, and failure to do so renders the petition liable to be dismissed. It is
    
    finally submitted that the entire writ petition is misconceived, misleading,
    
    and based on incorrect and unsubstantiated facts, and has been filed with
    
    an oblique motive, amounting to an abuse of the process of law, seeking to
    
    obtain reliefs without any legal foundation; the same therefore deserves to
    
    be dismissed with exemplary costs.
    
    38. On the issue of diversification, in their cross Special Appeal Writ 7, the
    
    Respondents placed reliance on clause (j) of the agreement and the MoA to
    
    submit that the land could have been subjected to any other use by the
    
    appellant-company for the purposes of expansion and diversification. It was
    
    also stated that while mutating the land in favour of the appellant-
    
    company, the Tehsildar imposed two conditions, i.e., state government will
    
    not accord approval for the sale of this land and their permission is
    
    required for other commercial use.
    7   DB Special Appeal Writ No. 168/2026
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    39. It is further stated in the Special Appeal Writ that the judgement dated
    
    12.05.2025 is contrary to law as the learned single judge has not properly
    
    construed clause (j) of the agreement dated 12.11.1992, a perusal of
    
    which, clearly demonstrates that the company can expand its operations or
    
    product lines to include more variety but not to make use of the land for
    
    any   other   commercial   activities     or    to    sell    or    alienate    the   same.
    
    Furthermore, the learned single judge failed to appreciate the fact that the
    
    MoU dated 12.11.1992 imposed certain conditions (revival of industry
    
    within stipulated time, employment generation, recommencement of
    
    operations in previously closed units, regularisation of the industry in
    
    complying with all statutory obligations and discharging all liabilities of the
    
    company including payment of outstanding dues), none of which have been
    
    fulfilled by the company for more than 33 years and hence no benefit or
    
    concession can be extended to the respondent company, particularly when
    
    the state government never granted any exemption or concession to it from
    
    the terms of company shareholding transfer, which are still in force and
    
    binding on the company.
    
    40. It has been further stated in the said writ that despite repeated
    
    reminders to ensure compliance, the company has failed to do so. It was
    
    also argued that the learned single judge failed to consider the fact that the
    
    land in question is situated in a strategically important and prime location
    
    and no other suitable land is available in the vicinity and the same is
    
    needed for industrial development and public purposes. Therefore, if the
    
    company has no intention of reviving the industry, then the land can be
    
    better utilised for other public and industrial purposes.
    
    
    
    
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    41. It is also stated in the abovementioned writ that that clause (p) of the
    
    agreement clearly stipulated that in the event of any disputes arising at any
    
    stage in relation to any aspect of the agreement or its interpretation, the
    
    same shall be referred to the sole arbitrator and that Section 5 of the
    
    Arbitration and Conciliation Act 1996 bars judicial intervention in matters
    
    governed by the said part. In this regard, the Hon'ble Supreme Court in
    
    Bisra Stone Lime Company Ltd. and Another vs Orissa State
    
    Electricity Board and Another8 has categorically held that the High Court
    
    may refuse to exercise its jurisdiction if there exists a valid arbitration
    
    clause. Furthermore, as this alternate remedy was available, a writ petition
    
    was not maintainable, for which reliance was placed on a decision of the
    
    Hon'ble Supreme Court in A.V. Venkateswaran, Collector of Customs,
    
    Bombay vs Ramchand Sobhraj Wadhwani and Another 9.
    
    42. It was further argued that the writ petition suffers from inordinate
    
    delay as the mutation was sanctioned in 2009 whilst the writ petition was
    
    filed in 2021. Reliance in this regard was placed on a decision of the Apex
    
    Court in Mrinmoy Maity vs Chhanda Koley and Others 10 wherein the it
    
    was held that ordinarily, inordinate delays would be fatal to the litigants
    
    case.
    
    43. It was also pointed out that the learned single judge has failed to
    
    consider that in the writ petition, the company has not challenged the order
    
    of the district collector which is a quasi judicial order but rather it has
    
    challenged the action of the Patwari which is an executive order which is
    
    consequential in the form of compliance of the order of the district collector.
    
    In this regard, it was argued that it is settled law that no writ of certiorari
    
    can be issued against an executive action.
    
    8 1976 (2) SCC 167
    9 1961 SCC OnLine SC 16
    10 2024 (15) SCC 215
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    Issues for Determination
    
    1. Whether a Writ petition is maintainable in this case?
    
    2. Whether any conditions could have been imposed subsequent to signing
    
    of the agreement dated 12.11.1992?
    
    3. Whether mutation proceedings can be used to impose substantive
    
    restrictions affecting proprietary rights?
    
    4. Whether relegation to arbitration was justified in the facts of the present
    
    case?
    
    Analysis and Discussion
    A. Maintainability of the Writ Petition
    44. The facts and circumstances of the present case unequivocally indicate
    
    that    the   impugned   actions   of    the     respondents            are   arbitrary   and
    
    discriminatory, and therefore violative of Article 14 of the Constitution of
    
    India. The material on record reflects that the conditions in question have
    
    been imposed selectively upon the appellants, while similarly situated
    
    entities have not been subjected to any such restrictions, without there
    
    being any intelligible differentia or rational nexus with the object sought to
    
    be achieved.
    
    45. Further, the effect of the impugned conditions is such that it
    
    substantially impairs the appellants' ability to use, enjoy, and deal with
    
    their property in a lawful manner. This then goes counter to the arguments
    
    made by the Respondents of non-operationalization of the industry as such
    
    conditions itself serves as a roadblock to operating the manufacturing unit.
    
    This amounts to an unjustified interference with the appellants' right to
    
    property, guaranteed under Article 300A of the Constitution of India, as the
    
    deprivation is not backed by any valid authority of law. The restrictions,
    
    therefore, operate not merely as regulatory measures, but as an effective
    
    
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    denial of the beneficial enjoyment of the property, rendering the action of
    
    the respondents constitutionally unsustainable.
    
    46. The scope of Article 300-A was examined in K.T. Plantation (P) Ltd.
    
    v. State of Karnataka11, wherein the Apex Court held that:
    
                166. Article 300-A, when examined in the light of the
                circumstances under which it was inserted, would
                reveal the following changes:
                1. Right to acquire, hold and dispose of property has
                ceased to be a fundamental right under the
                Constitution of India.
                2. Legislature can deprive a person of his property only
                by authority of law.
                3. Right to acquire, hold and dispose of property is not
                a basic feature of the Constitution, but only a
                constitutional right.
                4. Right to property, since no more a fundamental
                right, the jurisdiction of the Supreme Court under
                Article 32 cannot be generally invoked, aggrieved
                person has to approach the High Court under Article
                226 of the Constitution.
    
                168. Article 300-A proclaims that no person can be
                deprived of his property save by authority of law,
                meaning thereby that a person cannot be deprived of
                his property merely by an executive fiat, without any
                specific legal authority or without the support of law
                made by a competent legislature. The expression
                "property" in Article 300-A confined not to land alone,
                it includes intangibles like copyrights and other
                intellectual property and embraces every possible
                interest recognised by law.
    
                169. This Court in State of W.B. v. Vishnunarayan and
                Associates (P) Ltd. [(2002) 4 SCC 134] , while
                examining the provisions of the West Bengal Great
                Eastern Hotel (Acquisition of Undertaking) Act, 1980,
                held in the context of Article 300-A that the State or
                executive officers cannot interfere with the right of
                others unless they can point out the specific provisions
                of law which authorises their rights.
    
                170. Article 300-A, therefore, protects private property
                against executive action. But the question that looms
                large is as to what extent their rights will be protected
                when they are sought to be illegally deprived of their
                properties on the strength of a legislation. Further, it
                was also argued that the twin requirements of "public
                purpose" and "compensation" in case of deprivation of
                property are inherent and essential elements or
                ingredients, or "inseparable concomitants" of the power
                of eminent domain and, therefore, of List III Entry 42,
                as well and, hence, would apply when the validity of a
                statute is in question.
    11 (2011) 9 SCC 1
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    47. A further example of such arbitrariness is the fact that the minutes of
    
    the meeting dated 13.06.2008 do not show anything to indicate that the
    
    objections raised by the appellant were considered prior to imposing such
    
    conditions, which is arbitrary. In this regard, it is important to note that one
    
    of   the    cardinal     principles   of   administrative          law       is   to   ensure that
    
    administrative action taken fairly and after giving due consideration to the
    
    objections raised by those who will be affected by such decisions. A similar
    
    stance was taken by the Apex Court in Basudev Dutta vs State of West
    
    Bengal and Ors.12 which held that:
    
               "12.2. It is settled law that every administrative or
               quasi-judicial order must contain the reasons. Such
               reasons go a long way in not only ensuring that the
               authority has applied his mind to the facts and the law,
               but also provide the grounds for the aggrieved party to
               assail the order in the manner known to law. In the
               absence of any reasons, it also possesses a difficulty
               for the judicial authorities to test the correctness of the
               order or in other words, exercise its power of judicial
               review......."
    
    
    48. Furthermore, on the aspect of deprivation of property, the Hon'ble
    
    Supreme Court recently in Samiullah vs State of Bihar and Ors. 13
    
    observed that:
    
               "36. A requirement of rules, regulations or even law
               that impedes or restrains easy and effective transfer of
               property will be illegal as it has the direct effect of
               "depriving of property" to that extent, and such delays,
               caused due to unreasonable and arbitrary restrictions,
               impinge the right to hold and dispose of property. We
               therefore hold that the prescription of mentioning and
               production of jamabandi allotment or holding allotment
               as a precondition for registration of a legally presented
               document under impugned sub-rules 19(xvii) and
               (xviii) is arbitrary and illegal and as such, liable to be
               set aside."
    
    
           Therefore, the conditions imposed vide the meeting dated 13.06.2008
    
    which restrain such ''easy and effective transfer'' can be said to be illegal.
    
    12 2024 SCC OnLine SC 3616
    13 (2026) 1 SCC 475
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    49. On the issue as to whether the writ petition was maintainable in the
    
    present case, and whether the appellants-writ petitioners were justified in
    
    invoking the extraordinary jurisdiction of this Hon'ble Court under Article
    
    226 of the Constitution of India in a contractual matter, the same has been
    
    settled by a judgment of the Hon'ble Supreme Court in Rajasthan State
    
    Industrial Development & Investment Corporation v. Diamond &
    
    Gem Development Corporation Ltd.14, wherein it was held as under:
    
               "21. It is evident from the above that generally the
               Court should not exercise its writ jurisdiction to enforce
               the contractual obligation. The primary purpose of a
               writ of mandamus is to protect and establish rights and
               to impose a corresponding imperative duty existing in
               law. It is designed to promote justice (ex debito
               justitiae). The grant or refusal of the writ is at the
               discretion of the court. The writ cannot be granted
               unless it is established that there is an existing legal
               right of the applicant, or an existing duty of the
               respondent. Thus, the writ does not lie to create or to
               establish a legal right, but to enforce one that is
               already established. While dealing with a writ petition,
               the court must exercise discretion, taking into
               consideration a wide variety of circumstances, inter
               alia, the facts of the case, the exigency that warrants
               such exercise of discretion, the consequences of grant
               or refusal of the writ, and the nature and extent of
               injury that is likely to ensue by such grant or refusal.
    
               22. Hence, discretion must be exercised by the court
               on grounds of public policy, public interest and public
               good. The writ is equitable in nature and thus, its
               issuance is governed by equitable principles. Refusal of
               relief must be for reasons which would lead to injustice.
               The prime consideration for the issuance of the said
               writ is, whether or not substantial justice will be
               promoted. Furthermore, while granting such a writ, the
               court must make every effort to ensure from the
               averments of the writ petition, whether there exist
               proper pleadings. In order to maintain the writ of
               mandamus, the first and foremost requirement is that
               the petition must not be frivolous, and must be filed in
               good faith. Additionally, the applicant must make a
               demand which is clear, plain and unambiguous. It must
               be made to an officer having the requisite authority to
               perform the act demanded. Furthermore, the authority
               against whom mandamus is issued, should have
               rejected the demand earlier. Therefore, a demand and
               its subsequent refusal, either by words, or by conduct,
               are necessary to satisfy the court that the opposite
               party is determined to ignore the demand of the
    
    14 (2013) 5 SCC 470
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                applicant with respect to the enforcement of his legal
                right. However, a demand may not be necessary when
                the same is manifest from the facts of the case, that is,
                when it is an empty formality, or when it is obvious
                that the opposite party would not consider the
                demand."
    
    
    50.    In    an       earlier   decision,    the     Hon'ble        Supreme     Court   in   ABL
    
    International Ltd. v. Export Credit Guarantee Corpn. of India Ltd. 15
    
    held as under:
    
                "52. On the basis of the above conclusion of ours, the
                question still remains why should we grant the reliefs
                sought for by the appellants in a writ petition when a
                suitable efficacious alternate remedy is available by
                way of a suit. The answer to this question, in our
                opinion, lies squarely in the decision of this Court in the
                case of Shrilekha Vidyarthi [(1991) 1 SCC 212 : 1991
                SCC (L&S) 742] wherein this Court held: (SCC pp. 235-
                37, paras 20-22 & 24)
                The requirement of Article 14 should extend even in
                the sphere of contractual matters for regulating the
                conduct of the State activity. Applicability of Article 14
                to all executive actions of the State being settled and
                for the same reason its applicability at the threshold to
                the making of a contract in exercise of the executive
                power being beyond dispute, the State cannot
                thereafter cast off its personality and exercise
                unbridled power unfettered by the requirements of
                Article 14 in the sphere of contractual matters and
                claim to be governed therein only by private law
                principles applicable to private individuals whose rights
                flow only from the terms of the contract without
                anything more. The personality of the State, requiring
                regulation of its conduct in all spheres by requirements
                of Article 14, does not undergo such a radical change
                after the making of a contract merely because some
                contractual rights accrue to the other party in addition.
                It is not as if the requirements of Article 14 and
                contractual obligations are alien concepts, which cannot
                coexist. The Constitution does not envisage or permit
                unfairness or unreasonableness in State actions in any
                sphere of its activity contrary to the professed ideals in
                the preamble. Therefore, total exclusion of Article 14 --
                non-arbitrariness which is basic to rule of law -- from
                State actions in contractual field is not justified. This is
                more so when the modern trend is also to examine the
                unreasonableness of a term in such contracts where
                the bargaining power is unequal so that these are not
                negotiated contracts but standard form contracts
                between unequals.
                Unlike the private parties the State while exercising its
                powers and discharging its functions, acts indubitably,
                as is expected of it, for public good and in public
    
    15 (2004) 3 SCC 553
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               interest. The impact of every State action is also on
               public interest. It is really the nature of its personality
               as State which is significant and must characterize all
               its actions, in whatever field, and not the nature of
               function, contractual or otherwise, which is decisive of
               the nature of scrutiny permitted for examining the
               validity of its act. The requirement of Article 14 being
               the duty to act fairly, justly and reasonably, there is
               nothing which militates against the concept of requiring
               the State always to so act, even in contractual matters.
               This factor alone is sufficient to import at least the
               minimal requirements of public law obligations and
               impress with this character the contracts made by the
               State or its instrumentality. It is a different matter that
               the scope of judicial review in respect of disputes falling
               within the domain of contractual obligations may be
               more limited and in doubtful cases the parties may be
               relegated to adjudication of their rights by resort to
               remedies      provided    for   adjudication    of  purely
               contractual disputes. However, to the extent, challenge
               is made on the ground of violation of Article 14 by
               alleging that the impugned act is arbitrary, unfair or
               unreasonable, the fact that the dispute also falls within
               the domain of contractual obligations would not relieve
               the State of its obligation to comply with the basic
               requirements of Article 14. To this extent, the
               obligation is of a public character invariably in every
               case irrespective of there being any other right or
               obligation in addition thereto. An additional contractual
               obligation cannot divest the claimant of the guarantee
               under Article 14 of non-arbitrariness at the hands of
               the State in any of its actions."
    
    
    51. Subsequently, on the aspect of issuance of writs, the Hon'ble
    
    Supreme Court in Joshi Technologies International Inc. v. Union
    
    of India16 held that:
    
               "70.7. Writ can be issued where there is executive
               action unsupported by law or even in respect of a
               corporation there is denial of equality before law or
               equal protection of law or if it can be shown that action
               of the public authorities was without giving any hearing
               and violation of principles of natural justice after
               holding that action could not have been taken without
               observing principles of natural justice."
    
    
    52. In light of the above discussion, we find the present writ petition to
    
    be maintainable.
    
    B. Imposition of Conditions Post Signing of Agreement Dated
    12.11.1992
    
    
    16 (2015) 7 SCC 728
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    53. Regarding the contention pertaining to violation of Sections 10 and 11
    
    of the Transfer of Property Act 1882, it would be apposite to first quote the
    
    same:
    
             "10.     Condition      restraining    alienation.-Where
             property is transferred subject to a condition or
             limitation absolutely restraining the transferee or any
             person claiming under him from parting with or
             disposing of his interest in the property, the condition
             or limitation is void, except in the case of a lease where
             the condition is for the benefit of the lessor or those
             claiming under him:
    
                  Provided that property may be transferred to or
             for the benefit of a women (not being a Hindu,
             Muhammad or Buddhist), so that she shall not have
             power during her marriage to transfer or charge the
             same or her beneficial interest therein.
    
             11. Restriction repugnant to interest created.-
             Where, on a transfer of property, an interest therein is
             created absolutely in favour of any person, but the
             terms of the transfer direct that such interest shall be
             applied or enjoyed by him in a particular manner, he
             shall be entitled to receive and dispose of such interest
             as if there were no such direction.
    
                   [Where any such direction has been made in
             respect of one piece of immoveable property for the
             purpose of securing the beneficial enjoyment of
             another piece of such property, nothing in this section
             shall be deemed to affect any right which the transferor
             may have to enforce such direction or any remedy
             which he may have in respect of a breach thereof.]"
    
    
    54. From a perusal of agreement dated 12.11.1992, it is apparent that no
    
    condition was imposed at the time of transfer of the land. What was said in
    
    clause (j) was that the plant and machinery are to be used for the
    
    manufacture of leather and leather goods with liberty granted to the
    
    appellant to expand and diversify into areas which are useful for the
    
    company and for generating employment for the local population (as far as
    
    possible). The restrictions on alienation were subsequently imposed by the
    
    state government vide the meeting dated 13.06.2008, mentioning that sale
    
    of the said land would not be permitted by the state government and grant
    
    of NOC will be basis the conditions laid down in the said meeting.
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    55. A condition imposed unilaterally, in absence any statutory provision
    
    permitting the same and in violation of the statutory provisions mentioned
    
    above, particularly subsequent to signing of the agreement of 12.11.1992
    
    is void. In the context of unilateral modification of contract, the Hon'ble
    
    Supreme         Court   in   Kanwar         Raj       Singh        (D)      Through    Legal
    
    Representatives vs Gejo (D) Through Legal Representatives and
    
    Ors.17 observed as under:
    
               "13. The corrections unilaterally made by the first
               defendant after the execution of the sale deed without
               the knowledge and consent of the purchaser will have
               to be ignored. Only if such changes would have been
               made with the consent of the original plaintiff, the
               same could relate back to the date of the execution. It
               is not even the first defendant's case that the
               subsequent correction or interpolation was made before
               its registration with the consent of the original plaintiff.
               Therefore, in this case, what will operate is the sale
               deed as it existed when it was executed."
    
    56. On the above mentioned issue, the Hon'ble Supreme Court in Delhi
    
    Development Authority and Anr. vs Joint Action Committee, Allottee
    
    Of SFS Flats And Ors.18 had held as under:
    
               "66. The stand taken by DDA itself is that the
               relationship between the parties arises out of the
               contract. The terms and conditions therefor were,
               therefore, required to be complied with by both the
               parties. Terms and conditions of the contract can
               indisputably be altered or modified. They cannot,
               however, be done unilaterally unless there exists any
               provision either in contract itself or in law. Novation of
               contract in terms of Section 60 of the Contract Act
               must precede the contract-making process. The parties
               thereto must be ad idem so far as the terms and
               conditions are concerned. If DDA, a contracting party,
               intended to alter or modify the terms of contract, it was
               obligatory on its part to bring the same to the notice of
               the allottee. Having not done so, it, relying on or on
               the basis of the purported office orders which are not
               backed by any statute, new terms of contract could (sic
               not be) thrust upon the other party to the contract. The
               said purported policy is, therefore, not beyond the pale
               of judicial review. In fact, being in the realm of
               contract, it cannot be stated to be a policy decision as
               such."
    
    
    17 (2024) 2 SCC 416
    18 (2008) 2 SCC 672
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    57. Before proceeding further, it would be apposite to refer to Sections 90-
    
    A and 102 of the Rajasthan Land Revenue Act 1956 which reads as under:
    
               "[90-A.] Use of agricultural land for non-
               agricultural purpose -
               .....
    

    (3) The State Government shall, after making or
    causing to be made due inquiry in the prescribed
    manner, either refuse the permission applied for or
    grant the same subject to the prescribed terms and
    conditions.

    ………

    SPONSORED

    102. Power of Government to allot land for
    purposes other than agricultural as well as on
    special terms – Notwithstanding anything hereinforce
    contained, the State Government shall have power to
    allot land for the purpose of an industry or for any
    purpose of public utility on such conditions as it deems
    fit.”

    58. The discretion exercisable by the state government (mentioned above)

    to impose conditions for allotment of land can be said to be encapsulated

    within the terms stipulated in the agreement, which itself does not provide

    for further discretion to the state for subsequent and unilateral addition of

    conditions. In this regard, the Apex Court in State of Madhya Pradesh vs

    Sew Construction Limited and Ors.19 held as under:

    “23. In the context of discretion, we may reiterate this
    principle. The rights and duties of the parties to the
    contract subsist or perish in terms of the contract itself.
    Even if a party to the contract is a governmental
    authority, there is no place for discretion vested in the
    officers administering the contract. Discretion, a
    principle within the province of administrative law, has
    no place in contractual matters unless, of course, the
    parties have expressly incorporated it as a part of the
    contract. It is the bounden duty of the court while
    interpreting the terms of the contracts, to reject the
    exercise of any such discretion that is entirely outside
    the realm of the contract.”

    59. A perusal of the agreement between the appellant and the state

    government show that the entire shareholding of the appellant-company

    was transferred to the now appellants. This would include the property

    used to operate the manufacturing unit. While the agreement did stipulate

    expansion and modernisation of the unit, it did not include any express

    19 (2022) 17 SCC 370
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    prohibition on the alienation of the property. In this regard, recently, the

    Apex Court in Annaya Kocha Shetty (Dead) through Lrs vs Laxmibai

    Narayan Satose Since Deceased through Lrs. and Ors. 20 provided the

    following guidance on the interpretation of deeds:

    “17. The guide to the construction of deeds and tools
    adopted can broadly be summarised as follows:

    17.1 The contract is first constructed in its plain,
    ordinary and literal meaning. This is also known as the
    literal rule of construction.

    17.2 If there is an absurdity created by literally
    reading the contract, a shift from literal rule may be
    allowed. This construction is generally called the golden
    rule of construction.

    17.3 Lastly, the contract may be purposively
    constructed in light of its object and context to
    determine the purpose of the contract. This approach
    must be used cautiously.

    18. The construction of a deed is “generally speaking,
    a matter of law.” However, when there is an ambiguity
    in the deed, determining its meaning is a mixed
    question of fact and law. This concept is encapsulated
    by sections 91 and 92 of the Evidence Act, 1872.
    18.1 Section 91 of the Evidence Act, 1872 denotes that
    a deed constitutes the primary evidence of the terms to
    which the parties are to adhere. Whereas section 92 of
    the Evidence Act, 1872 forbids any contradictions or
    variations in a written document by extrinsic evidence.

    However, there are exceptions outlined in the proviso
    to section 92, that allow variations from this general
    rule…….”

    60. This usage of the surrounding context to interpret a contract was also

    recently mentioned by the Apex Court in General Secretary,

    Vivekananda Kendra vs Pradeep Kumar Agarwalla and Ors. 21,

    wherein it was observed that:

    “19. If the words in a contract/deed are clear, there is
    very little the courts must do in the construction of the
    contract in determining the intention of the parties. In
    furtherance of determining the intention, the deed
    must be read as a whole to ascertain the true meaning
    of its clauses, and the words of each clause should be
    interpreted harmoniously. This intention must be
    derived directly from the plain and ordinary meaning of
    the text itself. Furthermore, these words should be
    understood exactly as the intended parties would
    commonly use them. The covenants must be applied
    precisely as written, neither diluted into irrelevance nor

    20 2025 SCC OnLine SC 758
    21 2026 SCC OnLine SC 316
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    stretched beyond their original scope. If the
    construction of the contract/deed, through its words
    and context, does not provide the court with the
    parties’ intention, the court may have regard to the
    circumstances surrounding its creation and the subject-
    matter to which it was designed and intended to
    apply.”

    61. From a reading of the above, it is clear that when a contract is

    executed between parties, it is assumed to be the final and complete

    understanding reached and agreed to between such parties and therefore

    serves as an exclusion to extrinsic evidence [see decision of the Apex Court

    in Roop Kumar vs Mohan Thedani 22 (also subsequently referred to by

    the Apex Court in V. Anantha Raju and Anr. vs T.M. Narasimhan and

    Ors.23)]. However, an exception to the above is when a contract is silent on

    something, a court can imply certain terms [though such power is limited

    to certain grounds (as enumerated by the Apex Court in Adani Power

    (Mundra) Limited vs Gujarat Electricity Regulatory Commission and

    Ors.24)]:

    “24. It could thus be seen that it is more than well
    settled that the clauses in the agreement ought to be
    given the plain, literal and grammatical meaning of the
    expression used in the same. No doubt, that the courts
    will also try to gather as to what intention the parties
    wanted to give them. As has been held by Ranjan
    Gogoi, J. (as his Lordship then was) the principle of
    business efficacy could be invoked only if by a plain
    literal interpretation of the term in the agreement or
    the contract, it is not possible to achieve the result or
    the consequence intended by the parties acting as
    prudent businessmen. This test requires that a term
    can only be implied, if it is necessary to give business
    efficacy to the contract, to avoid such a failure of
    consideration that the parties cannot as reasonable
    businessmen have intended. If the contract makes
    business sense without the term, the courts will not
    imply the same. It is amply clear that courts can imply
    a clause only if it is found that the plain and literal
    meaning given to the expression used in the terms is
    not in a position to make out the intention of the
    parties. Reading an unexpressed term in an agreement
    would be justified on the basis that such a term was
    always and obviously intended by and between the
    22 (2003) 6 SCC 595
    23 (2021) 17 SCC 165
    24 (2019) 19 SCC 9
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    parties thereto. An unexpressed term can be implied if
    and only if the court finds that the parties must have
    intended that term to form part of their contract. It is
    not enough for the court to find that such a term would
    have been adopted by the parties as reasonable men if
    it had been suggested to them. It must have been a
    term that went without saying, a term necessary to
    give business efficacy to the contract, a term which,
    although tacit, forms part of the contract. As held in
    Nabha Power Ltd. [Nabha Power Ltd. v. Punjab SPCL,
    (2018) 11 SCC 508 : (2018) 5 SCC (Civ) 1] , for
    invoking the business efficacy test and carving out an
    implied condition, not expressly found in the language
    of the contract, the following five conditions will have
    to be satisfied: (SCC p. 540, para 49)
    (1) Reasonable and equitable;

    (2) Necessary to give business efficacy to the contract;
    (3) It goes without saying i.e. the Officious Bystander
    Test;

    (4) Capable of clear expression; and
    (5) Must not contradict any express term of the
    contract.”

    62. When it comes to interpreting commercial contracts in general, while

    applying of tests like the Officious Bystander Test, the standard of

    ‘reasonableness’ to be applied is not an abstract one but rather of a person

    with similar knowledge, information and skill. Furthermore, deviation from

    the text of the agreement to rely on other sources for interpretation of the

    contract must be done sparingly. This is because, certainty and

    predictability is key in commercial transactions. When parties enumerate

    their common understanding of the terms and conditions in the form of an

    agreement, they do so to avoid any confusion or vagueness with regards to

    the rights and obligations of each party, thereby ensuring seamless

    execution of the agreement. This becomes particularly crucial for time

    sensitive transactions where delays can frustrate the agreement itself.

    Regarding interpretation, as good commercial practice, parties can include

    an ‘interpretation clause’ in their contracts which encompasses things like

    definitions, objectives, accepted commercial practices, etc. This will help

    resolve issues like multiple possible interpretations of a word and also

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    ensure contextual interpretation of words depending on which part of the

    agreement they are mentioned in. This will aid in reducing ambiguity when

    interpreting contracts. However, it is important to note that mere omission

    of a term generating some uncertainty which can be cured would not render

    a contract void. Rather, only when the above fails, then such agreements

    are void under Section 29 of the Indian Contract Act 1872. The same is

    reproduced below:

    “29. Agreements void for uncertainty.-

    Agreements, the meaning of which is not certain, or
    capable of being made certain, are void.”

    63. Now, we shall examine each of these conditions individually:

    (a) Regarding the first condition, in light of the judgements delivered

    in Kanwar Raj Singh (D) Through Legal Representatives

    (supra) and Delhi Development Authority (supra) read with the

    statutory restrictions imposed under Sections 10 and 11 of the Act

    of 1882, the first condition is not satisfied.

    (b) Regarding the second condition, it is first important to

    understand the objective behind entering into this agreement. For

    this, the tools provided in Annaya Kocha Shetty (Dead) through

    Lrs (supra) can be utilised. The literal and golden rules of

    interpretation would not be useful here as the condition under

    consideration, i.e., bar on alienation does not find any written

    expression, including through any terminology which can be utilised

    to infer such a condition. Therefore, this case calls for purposive

    interpretation, i.e., understanding the contract ”in light of its object

    and context” to identify the objective behind the same. A perusal of

    the facts of the case shows that the reason behind sale of the

    company was the losses it had incurred. This has also been reflected

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    in the preamble of the agreement, wherein it is mentioned that a

    substantial monetary amount is required to revive the company,

    which the state government is not in a position to provide for. This

    is the reason why the agreement mentions the appellant to take

    over the liabilities. The preamble also shows the objective of the

    agreement to be revival of the company. While determining the

    intention of the parties using the method given in General

    Secretary, Vivekananda Kendra (supra) and Annaya Kocha

    Shetty (Dead) through Lrs (supra), i.e., collective reading of the

    agreement, would therefore lead us to conclude that the intention

    was to ensure continued operations of the manufacturing unit and

    welfare of the local community. Therefore, not permitting

    investment in the manufacturing unit through alienation of land

    would go contrary to the business efficacy of the contract as it

    would hinder the operationalization of the manufacturing unit itself.

    (c) Regarding the third condition, the Apex Court in Enercon

    (India) Limited and Ors. vs Enercon GMBH and Anr. 25 observed

    that:

    “91. Dr Singhvi has rightly submitted that the
    unworkability in this case is attributed only to the
    machinery provision. And the arbitration agreement,
    otherwise, fulfils the criteria laid down under Section 44
    of the Indian Arbitration Act, 1996. Given that two
    arbitrators have been appointed, the missing line that
    “the two arbitrators appointed by the parties shall
    appoint the third arbitrator” can be read into the
    arbitration clause. The omission is so obvious that the
    court can legitimately supply the missing line. In these
    circumstances, the Court would apply the officious
    bystander principle, as explained by MacKinnon, L.J. in
    Shirlaw v. Southern Foundries (1926) Ltd. [(1939) 2
    KB 206 : (1939) 2 All ER 113 (CA), on appeal from
    1937 S 1835] , to interpret the clause. In Shirlaw
    [(1939) 2 KB 206 : (1939) 2 All ER 113 (CA), on
    appeal from 1937 S 1835] , it was held that: (KB p.

    227)

    25 (2014) 5 SCC 1
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    “… ‘prima facie that which in any contract is left to be
    implied and need not be expressed is something so
    obvious that it goes without saying; so that, if, while
    the parties were making their bargain, an officious
    bystander were to suggest some express provision for
    it in their agreement, they would testily suppress him
    with a common “Oh, of course!”‘”

    In construing an arbitration clause, it is not necessary
    to employ the strict rules of interpretation which may
    be necessary to construe a statutory provision. The
    court would be well within its rights to set right an
    obvious omission without necessarily leaving itself open
    to the criticism of having reconstructed the clause.”

    Therefore, from a discussion in the second condition, it is

    apparent that the agreement was entered into for the purpose of

    the company’s revival and continued operations. Therefore, any

    condition, like restriction on alienation of land, which hinders such

    an objective, cannot be said to form an obvious part of the

    agreement.

    (d) Regarding the fourth condition, the test here is to ascertain

    whether such a term can be clearly expressed from a perusal of the

    agreement and using the tools provided in Annaya Kocha Shetty

    (Dead) through Lrs (supra) and General Secretary,

    Vivekananda Kendra (supra). From statement of the relevant

    facts discussed for the second test, it is apparent that non-alienation

    of the land cannot be said to be a valid condition, factoring in the

    context in which the agreement was entered into as well as its terms

    and conditions.

    (e) Regarding the fifth condition, while the point pertaining to bar on

    alienation of property was not expressly mentioned and therefore

    such a subsequent bar did not contradict an ”express term”, the

    meeting dated 13.06.2008 did impose a bar on usage of the land for

    commercial purposes without prior approval of the state government

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    which is directly contradictory to clause (i) of the agreement dated

    12.11.1992 which mentions that:

    “(i) Transferee will embark upon the scheme for
    expansion/modernisation of the unit in accordance with
    the latest proposals dated 23.7.92 submitted by it to
    the Principal Secretary, State Enterprises. In the
    process, transferee will bring share capital amounting
    to $ 3,00,000 along with interest free loan amounting
    to $ 4,35,000 and make working capital arrangements
    as per projections. The production will commence
    within 5 months of handing over.”

    Therefore, the fifth condition is not satisfied.

    64. Thus, after the agreement has been entered into and the property

    having been handed over, the state government lost its right on the land

    and the factory in toto. There was no occasion therefore for the state

    government to hold a meeting on 13.06.2008 and impose subsequent

    restrictions on the subsequent owners of the land as the state government

    did not have any power to intervene or interfere with the affairs of the

    leather company who could use their property, machines, etc. for

    expanding or to diversify into different sectors. Furthermore, a perusal of

    the other part of the agreement empowers them to mortgage the land to

    get loans and therefore, we find that the restrictions on alienation issued by

    the state government itself are per say illegal and come within the four

    corners of being declared void ab initio. The power exercised by the state

    government is a colourable exercise of power and would be in violation of

    Articles 14 and 19 for imposing unnecessary restrictions. Therefore, in

    absence of an express contractual prohibition, the appellants cannot be

    said to be restricted from alienating the property. Basis the above

    discussion, the artificial barriers created in full enjoyment of their property

    are not sustainable in law.

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    C. Mutation and Title Rights

    65. Mutation entries, as also argued by the learned counsel for the

    appellant, merely record changes to the revenue records and do not grant

    or restrict title to any property. Prior to discussing the judicial

    pronouncement on the same, it would be apposite to refer to Sections 90-A

    and 102 of the Rajasthan Land Revenue Act 1956 (mentioned above).

    66. Such a condition, however, cannot fall foul of the statutory provisions

    enshrined under the central Act of 1882 mentioned above. Regarding

    mutation entries, the law has been settled by the Apex Court in Jitendra

    Singh vs State of Madhya Pradesh and Ors. 26, wherein the following

    was observed:

    “7. Right from 1997, the law is very clear. In the case
    of Balwant Singh v. Daulat Singh (D) By Lrs., reported
    in (1997) 7 SCC 137, this Court had an occasion to
    consider the effect of mutation and it is observed and
    held that mutation of property in revenue records
    neither creates nor extinguishes title to the property
    nor has it any presumptive value on title. Such entries
    are relevant only for the purpose of collecting land
    revenue. Similar view has been expressed in the series
    of decisions thereafter.”

    Therefore, restrictions on exercise of the rights of a title holder, like

    bar on alienation of the land cannot be one of the conditions precedent to

    grant NOC for mutation as has been imposed vide the meeting dated

    13.06.2008. The same is also done in absence of any power granted under

    the Act of 1956.

    D. Relegation To Arbitration

    67. The question that arises for consideration is whether the learned Single

    Judge was justified in relegating the appellants-writ petitioners to the

    remedy of arbitration. Upon a careful examination of the nature of the

    dispute, it becomes evident that the controversy does not arise out of the

    terms of the agreement or their interpretation, but rather pertains to the

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    imposition of subsequent conditions by the State. Such action, having a

    direct bearing on the rights of the appellants, cannot be said to be confined

    to the realm of private law so as to oust the jurisdiction of this Court under

    Article 226 of the Constitution of India.

    68. It is well settled that the existence of an alternative remedy, including

    arbitration, does not operate as an absolute bar to the exercise of writ

    jurisdiction, particularly where the impugned action is alleged to be

    arbitrary, unreasonable, or violative of constitutional or statutory

    provisions. In this context, the Hon’ble Supreme Court in Harbanslal

    Sahnia v. Indian Oil Corporation Ltd. 27 wherein the Apex Court has

    authoritatively laid down the well-recognised exceptions to the rule of

    alternative remedy. The relevant extract from the said judgment is

    reproduced hereinbelow:

    “7. So far as the view taken by the High Court that the
    remedy by way of recourse to arbitration clause was
    available to the appellants and therefore the writ
    petition filed by the appellants was liable to be
    dismissed is concerned, suffice it to observe that the
    rule of exclusion of writ jurisdiction by availability of an
    alternative remedy is a rule of discretion and not one of
    compulsion. In an appropriate case, in spite of
    availability of the alternative remedy, the High Court
    may still exercise its writ jurisdiction in at least three
    contingencies: (i) where the writ petition seeks
    enforcement of any of the fundamental rights; (ii)
    where there is failure of principles of natural justice; or

    (iii) where the orders or proceedings are wholly without
    jurisdiction or the vires of an Act is challenged. (See
    Whirlpool Corpn. v. Registrar of Trade Marks [(1998) 8
    SCC 1] .) The present case attracts applicability of the
    first two contingencies. Moreover, as noted, the
    petitioners’ dealership, which is their bread and butter,
    came to be terminated for an irrelevant and non-

    existent cause. In such circumstances, we feel that the
    appellants should have been allowed relief by the High
    Court itself instead of driving them to the need of
    initiating arbitration proceedings.”

    69. Further reliance can also be placed on ABL International Ltd.

    (supra), wherein it has been held that even in contractual matters, a writ

    27 (2003) 2 SCC 107
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    petition would be maintainable where the State or its instrumentality acts

    in an arbitrary manner or in violation of Article 14.

    70. In the present case, the grievance of the appellants is not directed

    against any contractual stipulation, but against the unilateral imposition of

    conditions affecting their proprietary rights, which are alleged to be without

    authority of law. In such circumstances, the dispute clearly involves a

    public law element and cannot be relegated to arbitration, which is confined

    to adjudication of disputes arising out of the contract. The approach

    adopted by the learned Single Judge, therefore, in directing the appellants

    to avail the remedy of arbitration, does not appear to be in consonance

    with the settled principles governing the exercise of writ jurisdiction.

    71. We also notice a contradiction between the first and second replies

    given by different respondents. In the reply submitted by respondents 1

    and 5 to the writ petition, it was mentioned that:

    “7. That the alternate and efficacious remedy for the
    purpose of challenging the impugned orders lies before
    the competent forum as per the prevailing laws which
    have not been availed by the present petitioner and
    this writ petition has been directly filed by them before
    the Hon’ble High Court. As such on the ground of
    availability of alternate and efficacious remedy, the
    present writ petition is liable to be dismissed.”

    Whereas, in the reply submitted by respondents 2-4 to the writ

    petition, it was mentioned that:

    “L. The contents of grounds L are Respondent submits
    that the present dispute, concerning the validity of a
    state/statutory action or a question of title/revenue
    record correction under the Land Revenue Act, is a
    matter of public law. Disputes involving a public law
    element and the exercise of sovereign or administrative
    power are not arbitrable under the Arbitration and
    Conciliation Act, 1996
    . An Arbitrator, being creature of
    contract and private law, cannot decide issues requiring
    the interpretation and enforcement of constitutional or
    public law mandates, such as the validity of
    administrative actions or the correction of state
    revenue records. The proper forum for such a challenge
    is the Writ Court (High Court) or the specific Revenue
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    [2026:RJ-JP:16733-DB] (40 of 41) [SAW-850/2025]

    Courts/Authorities established by the statute, not an
    arbitral tribunal. Therefore, this ground is essentially an
    acknowledgement that the dispute is not one fit for
    arbitration.”

    Findings

    72. In view of the above discussion, we answer the questions framed as

    follows:

    (a) The present writ petition is maintainable

    (b) The restriction on the right to alienate property is not inferable on

    the terms of the agreement

    (c) The attempt to unilaterally modify the terms of the agreement

    dated 12.11.1992 vide meeting dated 13.06.2008 is illegal

    (d) Restrictions on exercise of the rights of a title holder, like bar on

    alienation of the land cannot be one of the conditions precedent to

    grant NOC for mutation

    (e) The manner in which the decision was taken in the meeting dated

    13.06.2008 is arbitrary and violative of Article 14

    (f) The decision dated in the meeting dated 13.06.2008 restricts the

    ”easy and effective transfer” of the property and therefore is illegal as

    per Samiullah (supra)

    73. In view of the above findings, analysis and discussion, we allow the DB

    Special Appeal Writ No.850/2025, Rajasthan Leather Industries Limited vs

    State of Rajasthan and Others, setting aside the judgement and order

    dated 12.05.2025 passed by the learned Single Judge whereby he restricts

    the sale and alienation of the property in question and usage for other

    purposes.

    74. D.B. Special Appeal Writ No.168/2026, State of Rajasthan and Others

    vs Rajasthan Leather Industries Limited is dismissed, both on merits as

    well as barred by limitation.

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    [2026:RJ-JP:16733-DB] (41 of 41) [SAW-850/2025]

    74. No order as to costs.

    75. All pending application(s) are disposed of.

    (SHUBHA METHA),J (SANJEEV PRAKASH SHARMA),ACTING CJ

    Gaurav/

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