The Supreme Court observed that persons in illegal occupation of the Government Land/Panchayat Land cannot, as a matter of right, claim regularization.

"Regularization of the illegal occupation of the Government Land/Panchayat Land can only be as per the policy of the State Government and the conditions stipulated in the Rules. If it is found that the conditions stipulated for regularisation have not been fulfilled, such persons in illegal occupation of the Government Land/Panchayat Land are not entitled to regularization", the bench comprising Justices DY Chandrachud and MR Shah observed.

In this case, the applicants who were in illegal possession of the land belonging to Gram Panchayat, made an application under Rule 12(4) of the Punjab Village Common Lands (Regulation) Rules, 1964. The Rule authorizes Gram Panchayat to sell its noncultivable land to the inhabitants of the village who have constructed their houses on or before 31.03.2000, subject to fulfilment of the conditions mentioned in Rule 12(4). The competent authority rejected this application holding that as the applicants are in illegal occupation of the area more than the required area up to a maximum of 200 square yards, they are not entitled to the benefit of Rule 12(4). The High Court dismissed the writ petition challenging the order passed by the authority.

In appeal, the Apex Court bench noted that the applicants were found to be in illegal occupation of the area of more than 200 square yards and therefore one of the conditions mentioned in Rule 12(4) is not satisfied. The court also, referring to Jagpal Singh v. State of Punjab, (2011) 11 SCC 396 observed that regularization of their illegal occupation of the panchayat land cannot be accepted. In the said judgment, the court had this Court directed to all the State Governments in the country that they should prepare schemes for eviction of illegal/unauthorized occupants of Gram Sabha / Gram Panchayat / Poramboke / Shamlat land and these must be restored to the Gram Sabha / Gram Panchayat for the common use of the villagers of the village.

"In the said decision, this Court had come down heavily upon such trespassers who have illegally encroached upon on the Gram Sabha/Gram Panchayat Land by using muscle powers/money powers and in collusion with the officials and even with the Gram Panchayat. In the said decision, this Court has observed that "such kind of blatant illegalities must not be condoned". It is further observed that "even if there is a construction the same is required to be removed and the possession of the land must be handed back to the Gram Panchayat". It is further observed that "regularizing such illegalities must not be permitted because it is Gram Sabha land which must be kept for the common use of the villagers of the village"., the court noted while dismissing the SLP.