It is not in doubt that S.1 of the Land Use Act vests in the Governor of a State the land in that State to be held in trust and administered accordingly. All lands in urban areas are under his control and management. All other lands are under the control and management of the respective Local Governments subject to certain aspects of intervention and determination of the Governor. It is also not in doubt that under S.5(1)(a) of the Act, it shall be lawful for the Governor to grant statutory rights of occupancy to any persons in respect of land, whether or not in an urban area. Under S.5(2), when such a grant is made, all existing rights to the use and occupation of the land which is the subject of the statutory right of occupancy shall be extinguished. But these provisions so far referred to are certainly not to be applied to defeat vested rights recognised under the Act itself. They may admittedly, defeat “existing rights to the use and occupation of the land” but not vested rights unless such vested rights are first revoked under S.28 of the Act as appropriate. This may be (a) for overriding public interest, (b) by notice on behalf of the President for public purposes, (c) for breach of the provisions imposed by S.10 of the Act, (d) for breach of any term envisaged by S.8 of the Act, (e) for refusal or neglect to comply with the requirement specified as per S.9(3) of the Act. In all these cases, the revocation shall be signified by notice duly issued and shall become valid when received by the person with such vested right: See S.28(6) and (7) of the Act. It is an accepted legal principle that vested rights are not lightly taken away. Under the Land Use Act it must be in accordance with S.28 and in addition compensation is payable by virtue of S.29. A person granted a right of occupancy acquires a vested right. So also is a person deemed to have been granted a right of occupancy under the relevant provisions of S.34 of the Act.
— Uwaifo, JSC. Olohunde v. Adeyoju (2000) – SC.15/1995