The Allahabad High Court has directed the Uttar Pradesh government to explain how shopkeepers displaced for a 300-bed super-speciality hospital in Ayodhya will be rehabilitated, calling their eviction without rehabilitation or compensation “highly condemnable”.
A division bench of the Lucknow bench, comprising Justice Shekhar B Saraf and Justice Amitabh Kumar Rai, said the proposed hospital served a public purpose but that traders dependent on their shops for livelihood could not be removed without alternative arrangements. The court said the action affected their right to livelihood and raised issues under Articles 19 and 21 of the Constitution.
The court also observed that the shops had been allotted on lease and that the occupants had acquired the status of lessees. It held that directing them to vacate without first terminating the leases was unjustified. The bench underlined that the affected shopkeepers should either be rehabilitated or compensated for losses suffered.
The directions came on a petition filed by Mohammad Naeem and five other shopkeepers. According to the petitioners, the Sitapur Eye Hospital Society, Faizabad, allotted the shops to them on 30-year leases in 2000. After completing the required formalities, they received possession on February 28, 2000. The petitioners said the leases were to be renewed every 30 years under the applicable rules.
The dispute intensified after Ayodhya’s district magistrate issued a notice on June 26, 2025, directing the shopkeepers to vacate the premises within 15 days. The notice stated that the land and shops had been transferred to the medical and family welfare department. The petitioners had earlier approached the high court, which directed the authorities to maintain the status quo until their representation was decided.
The district magistrate subsequently held, in an order dated July 31, 2026, that the land was required for construction of the hospital and that the shopkeepers had no right to continue occupying the premises. The high court’s latest observations challenge the adequacy of that approach by linking the land requirement for public infrastructure to the state’s responsibility towards existing leaseholders.
The court has directed the state medical and health department to file a counter-affidavit detailing the rehabilitation steps proposed for the shopkeepers. The affidavit must be submitted by an officer not below the rank of secretary within three weeks. The next hearing has been fixed for November 16.
