A) ABSTRACT / HEADNOTE

The Supreme Court in M/s A.P. Electrical Equipment Corporation v. The Tahsildar & Ors., 2025 INSC 274 examined whether the State had taken actual physical possession of a large tract of land under the Urban Land (Ceiling & Regulation) Act, 1976 (the ULC Act) before the Urban Land (Ceiling & Regulation) Repeal Act, 1999 (the Repeal Act, 1999) came into force in the State. The dispute turned on the validity and genuineness of notices purportedly issued under ss.10(5) and 10(6) of the ULC Act and a panchnama dated 08.02.2008.

The Single Judge of the High Court held the Section 10(6) order and the panchnama void finding: 

(i) mandatory procedure under ss.10(5)/10(6) was not followed,

(ii) the 30-day notice window was not respected,

(iii) the panchnama was poorly supported and likely fabricated, and

(iv) de facto possession remained with the landholder; hence the Repeal Act applied to revive the owner’s rights.

The Division Bench reversed, relying on accepted practice that panchnama is an acceptable mode of taking possession in large-area takings and treating certain date/anomaly issues as immaterial. The Supreme Court restored the Single Judge’s order: possession must be proved to be actual and de facto taken before the Repeal; mere vesting on record or paper entries does not suffice; the onus is on the State to show cogent evidence of physical possession; statutory steps and timeframes in ss.10(5)–(6) are mandatory in effect; and intra-court appeals must not supplant a reasonable Single-Judge view unless there is patent error.

Key holdings emphasise that the Repeal benefits those in physical possession and that “paper possession” cannot trump de facto control.

Keywords: ss.10(5), 10(6) ULC Act; Section 3 Repeal Act, 1999; actual physical possession; paper possession; panchnama; intra-court appeal.

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The appellant (now ECE Industries Ltd.) acquired a large industrial parcel in Fatehnagar, Hyderabad and filed statutory declarations under s.6(1) of the ULC Act. A complex regulatory history followed: exemptions under s.20(1)(a) and permissions under s.21(1), partial withdrawals of exemptions, and ultimately administrative computation of surplus under s.8(4) and declaration under s.10(3) (notification dated 03.10.2007).

The State issued a s.10(5) notice (dated 05.01.2008, allegedly affixed on 08.01.2008) directing surrender within 30 days; when surrender did not follow, an order under s.10(6) dated 05.02.2008 authorised taking possession and a panchnama of 08.02.2008 purportedly recorded physical takeover. The Repeal Act was adopted by the State effective 27.03.2008. The appellant challenged the service, the sequence (30-day requirement), the authenticity of the panchnama, and whether actual physical possession had been taken prior to repeal.

The Single Judge accepted these challenges and set aside the documents; the Division Bench reversed; the appellant appealed. The Supreme Court focused on whether possession was truly taken (de facto), the mandatory nature and effect of the 10(5)/10(6) steps, and the interplay with s.3 of the Repeal Act.

D) FACTS OF THE CASE

The appellant held approx. 163,679 sq. m. across several survey numbers; after exemptions and adjustments the State computed surplus as 46,538.43 sq. m. (Hyderabad portion). A gazette notification under s.10(3) dated 03.10.2007 declared vesting effective 12.07.2007. The Competent Authority issued a s.10(5) notice (05.01.2008) which respondents say was affixed due to a lockout and received 08.01.2008 calling for surrender within 30 days. Allegedly, order under s.10(6) authorising forcible takeover was passed 05.02.2008 and the enquiry officer executed a panchnama on 08.02.2008.

The appellant contended the panchnama and the 10(6) order are back-dated or fabricated and was not placed in physical possession; photographs, continued factory operation evidence, security gates and constructed apartments supported continued appellant control. The 10(6) order oddly mentions expiry on 01.10.2008 an obvious internal anomaly and the panchnama lacked adequate particulars of panchas and signatures, and was produced late (first handed to appellant in 2010). The Repeal Act adoption on 27.03.2008 is central: if possession was not actually taken before repeal, the statutory saving (restoring land to owner subject to repayment) would apply.

E) LEGAL ISSUES RAISED

i. Whether the State proved that actual physical possession of the surplus vacant land was taken before adoption of the Repeal Act, 1999?

ii. Whether service and procedure under ss.10(5)–(6) were mandatorily complied with (including the 30-day lapse) before taking possession?

iii. Whether a panchnama prepared and executed in the circumstances shown (with date anomalies and sparse panchas’ particulars) can constitute valid evidence of physical possession?

iv. Whether the Division Bench erred in substituting its view for a reasonable Single-Judge finding in an intra-court appeal?

F) PETITIONER / APPELLANT’S ARGUMENTS

The counsels for Petitioner/Appellant submitted that: the s.10(5) notice was never effectively served in accordance with statutory practice and Rules; the s.10(6) order was prepared before the 30-day window expired and contains inexplicable internal dates (e.g., 01.10.2008), demonstrating fabrication; the panchnama is a printed form with lacunae (no owner signature, incomplete panchas particulars) and was given to the appellant only in 2010; photographs and contemporaneous records show the factory and residential structures remained under appellant control; thus possession was never actually taken and the Repeal Act s.3 mandates abatement and restoration.

G) RESPONDENT’S ARGUMENTS

The counsels for Respondent submitted that: affixation on the factory gate (during lockout) was a valid mode of service (ULC Rules permit affixation); no second notice is required under s.10(6); panchnama is a recognised and pragmatic mode of taking possession in large land takings and, where executed before witnesses and surveyor, is evidentiary; date anomalies are clerical/internal and immaterial; revenue records and pahanis indicate the State’s entries and possession; the Single Judge therefore erred in disbelieving the documentary record.

H) JUDGEMENT

The Supreme Court affirmed the Single Judge. The Court analysed the scheme of s.10(3), (5) & (6) and s.3 of the Repeal Act and reiterated established precedents that vesting under s.10(3) effects de jure title but does not ipso facto effect de facto possession; actual physical possession must be proved to deny the protection of the Repeal. The Bench emphasised that sub-s.(5) contemplates a peaceful surrender after written notice and that sub-s.(6) caters for forcible taking only if s.10(5) steps were followed and failed.

The Court held the onus squarely on the State to demonstrate cogent evidence of physical possession before repeal; mere paper entries, internal notings, or late-produced panchnama without contemporaneous panchas’ affidavits will not suffice. The Court found material anomalies (the inexplicable 01.10.2008 date, late disclosure of documents, absence of landowner signature, lack of panchas’ affidavits) and corroborative facts (factory operation, buildings, security) that supported the Single Judge’s conclusion of non-possession.

On intra-court appeal law, the Court observed that a Division Bench should not overturn a reasonable Single-Judge view unless there is patent error; two reasonable views may exist but the Single Judge’s rational view should ordinarily prevail. Consequently, the Single Judge’s order was restored: s.3 of the Repeal Act applied and the State’s purported possession proceedings abated.

a. RATIO DECIDENDI

The operative ratio is that actual de facto physical possession before the Repeal is indispensable to deprive an owner of the Repeal’s protection; paper vesting under s.10(3) is insufficient. The Court places the evidential burden on the State to show that possession was physically taken by evicting occupants, occupying the land, and recording credible, contemporaneous evidence (panchanama with identifiable witnesses, site map, signatures, handover to revenue). Clerical anomalies and late production tilt the balance in favour of the landowner.

b. OBITER DICTA

The Court criticised routine departmental notings and emphasised fidelity to statutory procedure; it stressed the constitutional import of property protection in compulsory divestiture contexts and flagged that courts must scrutinise state records when factual claims are dispositive of statutory relief under repeal provisions. The Court also commented on pragmatic difficulties of large-area possession but retained strict insistence on credible proof.

c. GUIDELINES 

i. State must produce contemporaneous evidence of actual physical possession: site map, panchanama with full particulars and affidavits of panchas, handover records to revenue/beneficiary department.
ii. Dates and procedural timelines under ss.10(5)–(6) must be respected; back-dating or internal anomalies will be fatal if unexplained.
iii. Paper vesting alone will not oust s.3 protection of the Repeal; courts must examine de facto control.
iv. Intra-court appeals: Division Benches should not overturn reasonable Single Judge findings absent patent error.

I) CONCLUSION & COMMENTS

The judgment reaffirms a protective doctrine for owners in the wake of legislative repeals: administrative entries cannot be substitutes for tangible, demonstrable possession. Practically, the decision functions as a caution to revenue authorities to meticulously document possession processes and to litigants that courts will probe beyond paper records when repeal-saving provisions are contested.

The decision consolidates Hari Ram line and clarifies that ss.10(5)–(6) impose mandatory steps whose substance not merely form determines whether a post-repeal restoration arises. For practitioners, obtain early injunctive relief where possession is disputed and insist on contemporaneous evidentiary material from the State; for administrators, ensure service, chronological file notings, panchas’ affidavits and immediate handover to beneficiary departments.

Finally, the Court’s restraint on intra-court appellate interference strengthens the primacy of reasoned Single-Judge fact-finding in writ adjudication.

J) REFERENCES

a. Important Cases Referred

1. State of Uttar Pradesh v. Hari Ram, (2013) 4 SCC 280.
2. Vipin Chandra Vadilal Bavishi v. State of Gujarat, (2016) 4 SCC 531.
3. Sita Ram Bhandari Society v. Lieutenant Governor of NCT of Delhi, (2009) 10 SCC 501.
4. Raghbir Singh Sehrawat v. State of Haryana, (2012) (cited in judgment).
5. Omprakash Verma v. State of A.P., (2010) 13 SCR 302 (cited).

b. Important Statutes Referred

1. Urban Land (Ceiling & Regulation) Act, 1976 (Central Act 33 of 1976).
2. Urban Land (Ceiling & Regulation) Repeal Act, 1999 (with s.3 saving provision).

c. Primary Judgment (the file analysed)
M/s A.P. Electrical Equipment Corporation v. The Tahsildar & Ors., [2025] 2 S.C.R. 1625; 2025 INSC 274.