Syarikat Cempaka was the registered was the registered proprietor of a piece of land (namely Lot 1221) in Batu Gajah. The land was previously owned by the State Authority which had approved Syarikat Cempaka's application for alienation of the land. At the time of the alienation, there were many houses built on the occupied by squatter families (namely Bob and 20 friends). Syarikat Cempaka planned to develop the land and served a notice to quit on Bob and 20 friends to vacate the land.

Bob and the 20 friends refused to vacate the land. They argued that:

1. They had acquired a right in equity to be compensated.
2. Syarikat Cempaka, taking the land with full knowledge of the squatters occupying the land, and therefore took the land subject to squatters' equity.
3. Although the squatters had entered the state land without the interference by the State Authorities. They also argued that a District Officer allowed them to rebuild their houses on the land after a fire and a committee of residents had applied for temporary occupation licence based on promises by politicians that they would be given temporary occupation licence. At the same time Syarikat Cempaka had applied for alienation of the neighbouring land (namely lot 1222) from the State Authority. The state Authority approved its application and served form 5 A to Syarikat Cempaka. After receiving the approval letter, Syarikat Cempaka started doing the groundwork on the land to develop it.

Question :

Four (4) months later the State Authority sent a letter to Syarikat Cempaka informing them that the approval for the application for lot 1222 has lapsed and it should stop it activities on the land. Syarikat Cempaka claimed that it is the legal proprietor of Lot 1222 and wish to ignore the letter. Advise Syarikat Cempaka in details. Provided any cases that related.