State Property Vested Due to Illegal Occupation Must Be Utilized at Executive Discretion, Not Court-Mandated Auction.

The subject land (Survey No. 110-A, Thane) was originally allotted in 1951 to Sarjuprasad Pardeshi (father of the "Original Petitioners") on a new and impartible tenure

In 1974, the Original Petitioners placed the Original Respondents in possession via a deed

Following a failed eviction application under the BTAL Act, the Collector forfeited and resumed the land in 1984 due to a breach of grant terms

Successive appeals by both parties against the forfeiture were dismissed

In 2011, the Minister of Revenue regularized the Original Respondents' occupation

The Original Petitioners challenged this regularization in Writ Petition No. 11106 of 2011. The learned Single Judge dismissed the Writ Petition, holding the land belonged to the State, but directed that the State could re-auction the land and allow Original Respondents to participate

Both parties filed these Letters Patent Appeals (LPA) challenging that order

1. Whether the learned Single Judge erred in directing the State to re-auction/re-allot the subject land and allowing the illegal occupants to participate in such a process

2. Whether the State Government has the exclusive prerogative to decide the use of land once it has been legally resumed and vested in the State

The Court applied the principle of the Rule of Law regarding the disposal of public property, emphasizing that Government lands cannot be dealt with arbitrarily by the Executive or through regularization of illegal occupation

It relied on the doctrine of Separation of Powers, asserting that the Court cannot step into the shoes of the Executive to mandate a specific method of land disposal (such as auction) once land is vested in the State

The Court observed a contradiction in the Single Judge’s judgment: while the judge rightly criticized the "illegal" dealing of public property, the judge simultaneously issued directions for re-auctioning and recognized the participation rights of the Original Respondents

The Division Bench reasoned that once land is forfeited for breach of tenure and vested in the State, it becomes State property

Therefore, the Court cannot grant "participation rights" in a proposed auction to parties whose occupation was found to be contrary to law; doing so would implicitly recognize non-existent rights

The Court held that the State must have full control to use the land for any public purpose, and the Judiciary should not mandate an auction process as that constitutes an executive function

It upheld the finding that the land belongs to the State but set aside the Single Judge’s directions regarding re-auctioning and the Original Respondents’ right to participate

The Court held that the State Government is free to use the land for any public purpose in accordance with law

The State was directed to resume physical possession of the subject land within two months