Supreme Court Upholds Karnataka HC Ruling On Fraud In Land Auction Linked To Art Of Living

(MENAFN- Live Mint) The Supreme Court of India on Wednesday, September 17, upheld a Karnataka High Court ruling that a trustee of Ved Vignan Maha Vidya Peeth (VVMVP), a charitable trust established by Sri Sri Ravi Shankar's Art of Living, engaged in fraudulent conduct while purchasing agricultural land in a court auction in 2003, BarandBench reported.

A Bench of Justices Vikram Nath and PB Varale ruled that, despite the trustee having misrepresented his role during the auction, reopening the sale at this point was unwarranted. The top court also affirmed the high court's decision that an additional payment of ₹25 lakh per acre be made to the original landowner, along with a proper survey to determine the precise boundaries of the land.

“At the outset, we record our appreciation that the learned Single Judge of the High Court has carefully considered the long-drawn litigation, involving several rounds inter se the parties, as well as the various contentions raised and the conduct of the parties throughout. The learned Single Judge has rendered a just and equitable judgment by taking into account both the mitigating and aggravating aspects of their conduct,” the Bench stated, according to BarandBench.

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It noted,“In the garb of boundaries being mentioned, the appellant auction purchaser cannot claim any more area than what was put up for auction and thereafter purchased by him.”

“Insofar as the direction for payment of ₹25 lakhs per acre as additional sale consideration to the respondent is concerned, we do not wish to interfere with the same, considering the conduct of the appellant, whose dual role casts doubt on the entire proceedings," the Supreme Court mentioned, as per the report.

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The issue stems from the auction of an agricultural land parcel in 2003. That year, the Karnataka State Financial Corporation put 5.5 acres of agricultural land in Bengaluru's Agara village up for sale to recover dues from a borrower who had defaulted. R Raghu, a trustee of VVMVP, secured the auction by presenting himself as an individual agriculturist. During that period, the Karnataka Land Reforms Act prohibited trusts from buying agricultural land.

Raghu stated that he had actually bought the land on behalf of the trust following the auction's finalisation and a sale certificate issued in 2005. This led the original owner, GM Krishna, to contest the sale, claiming that the court had been deceived into approving a transaction that was legally forbidden. The district court sided with Krishna in 2015, annulled the auction sale and ruled that Raghu had committed fraud by presenting contradictory claims.

However, the high court partially overturned this decision in 2023. While asserting that fraud had been committed, the high court observed that the law prohibiting trusts from purchasing agricultural land was repealed in 2020, with retrospective effect dating back to 1974. Therefore, it decided against canceling the auction. Instead, the court instructed the trust to pay an additional compensation of ₹25 lakh per acre to the landowner and ordered a new survey to accurately establish the property's boundaries.

The apex court appreciated the manner in which the high court handled the long-running litigation.

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