Supreme court judgement
Shailesh Kr. Shah
(Querist) 31 January 2013
This query is : Resolved
R/Sirs,
In the Case of Delhi Airtech Services Vs. State of U.P. (2011) 8 SCLR 064. The supreme court division bench order that
"In view of the divergence of opinion on conclusions and also on various legal questions discussed in two separate judgments by us, the matter is required to be placed before the Hon’ble the Chief Justice of India for reference to a larger Bench to resolve the divergent views expressed in both the judgments and to answer the questions of law framed."
If any one have any update about pendency/disposal of above matter by the larger bench of the Supreme Court, please provide details.
Thanks & Regards,
Adv. Shailesh Kr. Shah
R.K Nanda
(Expert) 31 January 2013
search SC web site for it.
Shailesh Kr. Shah
(Querist) 31 January 2013
Shri R.K. Nanda
Respected Sir,
I am unable to find the matter on SC website. Since you are from the Supreme Court. Can you help me.
Thanks & Regards,
Adv. Shailesh Kr. Shah
Anirudh
(Expert) 31 January 2013
The following is the decision:
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.24 OF 2009
M/s. Delhi Airtech Services
Pvt. Ltd. & Anr. … Appellants
Versus
State of U.P. & Anr. … Respondents
J U D G M E N T
Swatanter Kumar, J.
1. I had the advantage of reading the well-written judgment
of my learned brother, A.K. Ganguly, J. Regretfully but
respectfully, I am unable to persuade myself to concur with
the findings recorded and the exposition of law expressed by
my learned brother. In order to discernly state the reasons for
my expressing a contrary view and dismissing the appeals of
the appellants on merits, it has become necessary for me to
state the facts as well as the law in some detail. It has been
necessitated for the reason that complete facts, as they appear
2
from the record and the facts which were brought to the notice
of the Court during the course of hearing by the respondents,
supported by the official records, duly maintained by them in
normal course of their business, have not, in their entirety,
and correctly been noticed in the judgment. I am also of the
considered view that, in fact, the questions framed
(particularly question ‘D’) in the judgment by my learned
brother neither so comprehensively arise in the facts and
circumstances of the present case nor were argued in that
manner and to that extent before the Court. Be that as it
may, I consider it necessary to restate the facts, deal with
different legal aspects of the case and then record the
conclusions which would even provide answers to the
questions framed by my learned brother at the very beginning
of his judgment. Before I proceed to do so, let me briefly but,
inter alia, state the reasons for my taking a view contrary to
the one recorded in the judgment of my learned brother:
I. I have already stated that complete and correct facts,
in their entirety, as they emerge from the records
3
produced before the Court (including the trial court
record) as well as the documents referred to during
the course of arguments by the respondents have not
been correctly noticed. The records referred to have
been maintained by the authorities in the normal
course of their business and their authenticity can
hardly be questioned. These documents have been
executed inter se various institutions/departments,
including the Collector’s office, who discharges quasijudicial
functions under the Act.
II. The judgment of this court in the case of Satendra
Prasad Jain & Ors. v. State of U.P. & Ors. [AIR 1993
SC 2517 = (1993) 4 SCC 369], in my humble view,
cannot be ignored and the principle stated therein
cannot be avoided on the ground that the judgment
was sub silentio. This I say so, for the reason that it
is not a decision in which the point was not raised,
argued and perceived by the Court. On the contrary,
the issue in relation to the consequences of non4
payment flowing from Section 17(3A) of the Land
Acquisition Act (for short, the ‘Act’) was specifically
noticed by the three-Judge Bench in paragraph 11 of
the judgment. It was discussed in some detail and a
definite finding was recorded thereby bringing the
judgment well within the dimensions of good
precedent. Thus, I, with respect, would prefer to
follow the larger Bench judgment rather than ignoring
the same for the reasons stated by my learned brother
in his judgment do not apply in the facts of the
present case.
III. The ratio decidendi of the judgment of this Court in
the case of Satendra Prasad Jain (supra) is squarely
applicable to the present case, on facts and law.
IV. It has not been correctly noticed in the judgment that
80 per cent of due compensation, which even the
appellants did not dispute during the course of
hearing, had not been tendered or paid to the
claimants, as contemplated under Section 17(3A) of
5
the Act. From the facts recorded hereinafter, it is
clear that within the prescribed period, the payments
were deposited with the State office of the
Collector/competent authority and it was for the State
to distribute the money in accordance with the
provisions of the Act. It is not only the scheme of the
Act but also an established practice that the amounts
are disbursed by the Collector to the claimants and
not directly by the beneficiary, for whose benefit the
land had been acquired. The beneficiary had
discharged its obligation by depositing, in fact, in
excess of 80 per cent of due compensation with the
competent authority. De hors the approach that one
may adopt in regard to the interpretation of Section
17(3A), on facts the notification is incapable of being
invalidated for non-compliance of the said Section.
V. The doctrine of strict construction does not per se
mandate that its application excludes the
simultaneous application of all other principles of
6
interpretation. It is permissible in law to apply the
rule of strict construction while reading the provisions
of law contextually or even purposively. The golden
rule of interpretation is the rule of plain language,
while preferring the interpretation which furthers the
cause of the Statute rather than that which defeats
the objects or purposes of the Act.
VI. Non-providing of consequences under Section 17(3A)
of the Act, in contradistinction to Sections 6 and 11 of
the same Act, in my considered view is largely the
determinative test for proper and judicious
interpretation of Section 17(3A).
VII. The judgment by my learned brother does not
consider the judgments of the Constitution Bench,
the larger Bench and even the equi-Bench, which
have to some extent a direct bearing on the matters in
issue before us. In this regard, reference can be made
to the Constitution Bench judgment of this Court in
the case of Offshore Holdings Pvt. Ltd. v. Bangalore
7
Development Authority & Ors. [(2011) 3 SCC 139], the
three-Judge Bench judgment in the case of Tika Ram
& Ors. v. State of U.P. & Ors., [(2009) 10 SCC 689] and
particularly the judgment of another equi-Bench of
this Court in the case of Banda Development
Authority, Banda v. Moti Lal Agarwal & Ors. [2011 (5)
SCALE 173], to which my learned brother (Ganguly,
J.) was a member. The latter case, inter alia, dealt
with a question of lapsing of proceedings under
Section 11A on the ground that the possession of the
property had not been taken as required under that
provision. While rejecting such a contention in that
case, the Court observed that if the beneficiary of the
acquisition is an agency or instrumentality of the
State 80 per cent of the total compensation is
deposited in terms of Section 17(3A) and substantial
portion of the acquired land has been utilized in
furtherance of the particular public purpose, it could
reasonably be presumed that the possession of the
acquired land had been irrevocably taken. The Court
8
then held that relief to the appellants (like the
appellants in the present case) of invalidating the
acquisition proceedings and restoring the land could
not be granted.
VIII. The 44th Constitutional Amendment, on the one hand,
omitted Article 19(1)(f) and Article 31 while
introducing Articles 31A and 300A to the Constitution
of India on the other. Right to property was deleted
as a fundamental right in the Constitution. Thus,
this right cannot be placed on equi terms,
interpretatively or otherwise, to the pre-constitutional
amendments. The right to eminent domain would
operate on a different sphere, interpretation and
effect, pre and post constitutional repealments of
these Articles and introduction of Article 300A of the
Constitution. Even on this aspect, I respectfully
disagree with the conclusions recorded by my learned
brother (Ganguly, J.).
FACTS:
9
2. Appellant No.1 is a company duly incorporated under the
provisions of the Indian Companies Act, 1956 and is alleged to
be the owner of the land sought to be acquired by the
respondents. The land of the appellant, admeasuring about 2-
06-1/3-0 Bighas situated in Village Haldauni, Tehsil and
Pargana Dadri, District Gautam Budh Nagar, which is an
abadi land, was sought to be acquired by the appropriate
Government under a notification dated 17th April, 2002 issued
under Section 4(1) read with Sections 17(1) and 17(4) of the
Act. This land was acquired for the planned industrial
development in District Gautam Budh Nagar through the New
Okhla Industrial Development Authority (NOIDA). The
notification also stated that the provisions of Section 5A of the
Act shall not apply. In pursuance to the said notification, a
declaration under Section 6 of the Act was published on 22nd
August, 2002, declaring the area which was required by the
Government. It also stated that after expiry of 15 days from
the date of the publication of the notification possession of the
acquired land shall be taken under sub-section (1) of Section 9
of the Act. The appellants have alleged that they did not
10
receive any notice under Section 9(1) of the Act but possession
of the land was nevertheless taken on 4th February, 2003.
According to the appellants, even after lapse of more than
three and a half years after publication of declaration under
Section 6 of the Act, the award had not been made and
published.
The appellants also alleged in the petition that, despite
inordinate delay, they were neither paid 80 per cent of the
estimated compensation in terms of Section 17(3A) of the Act
at the time of taking of possession, nor had the Collector
passed an award within two years of making the declaration
under Section 17(1), as required by Section 11A of the Act. It
was the case of the appellants in the writ petition that this has
the effect of vitiating the entire acquisition proceedings. Nonpayment
of the compensation and conduct of the Government
compelled the petitioners to file a writ petition in the High
Court of Allahabad praying for issuance of an order or
direction in the nature of certiorari or any other writ, not to
create any encumbrance or interest on the land of the
11
petitioners. Further, they prayed that the acquisition
proceedings, in so far as they relate to the land of the
petitioner, be declared void ab initio and that the respondents
be directed to return the land from the possession of the
Government to the owners. Lastly, the petitioners prayed that
the respondents/Government be directed to pay damages for
use and occupation of the land.
To this writ petition, the respondents had filed a counter
affidavit in the High Court, denying that the acquired land was
in fact a part of the abadi land. The respondent-authority has
also stated that 80 per cent compensation in terms of Section
17(3A) of the Act had been deposited with the authorities. The
land had been acquired for planned development of NOIDA
and was in the physical possession of the said authority.
Possession of the land had been taken on 4th February, 2003
and no right had survived in favour of the petitioners as the
land vested in the Government.
The High Court, vide its judgment dated 28th August,
2006, dismissed the writ petition. The High Court relied upon
12
the judgment of this Court in the case of Satendra Prasad Jain
(supra) and dismissed the petition holding that the provisions
of Section 11A of the Act are not attracted to proceedings for
acquisition taken by the Government under Section 17 of the
Act. However, liberty was granted to the petitioners to pray for
grant of appropriate compensation in accordance with law
before the competent forum.
Aggrieved by the said order of the High Court, the
appellants have filed the present appeal impugning the
judgment dated 28th August, 2006.
In the counter affidavit filed by respondent No.2 before
this Court, the submissions made before the High Court have
been reiterated with an additional fact that the sector in
question was designated as industrial area and after the
development activity was completed, allotment has been made
and possession of these industrial plots has also been handed
over to such entrepreneurs/allottees. This land falls under
Sector 88 of the NOIDA City. The rest of the allegations made
13
in the writ petition, except the dates in question, have been
disputed.
It has also been stated at the Bar, on the basis of the
record maintained in regular course of its business by the
respondent-authority, that 10 per cent of the estimated
compensation was deposited by the Authority with the State
Government even prior to the date of the notification under
Section 4(1) read with Section 17(4) of the Act, issued by the
Government, i.e., 17th April, 2002. The remaining 70 per cent
of the estimated compensation had allegedly been deposited
vide cheque dated 8/14th July, 2002 amounting to
approximately `6,66,00,000/-. As such, there is complete
compliance with the provisions of Section 17(3A) of the Act by
the authority concerned. The Award was made on 9th June,
2008, which has been accepted by a large number of owners,
i.e., 97.6 per cent of all owners. Some of these facts have also
been averred in the counter affidavit filed before the High
Court.
14
From the above pleadings of the parties, the admitted
facts that emerge from the record can be usefully
recapitulated. The Governor of the State of Uttar Pradesh on
17th April, 2002, issued a notification under Section 4(1) of the
Act, expressing the intention of the Government to acquire the
land stated in the said Notification for a public purpose,
namely, for the planned industrial development in District
Gautam Budha Nagar through NOIDA. Vide the same
notification the emergent provisions contained in Section 17 of
the Act, specifically Section 17(4), were also invoked,
intimating the public at large that the provisions of Section 5A
of the Act shall not be applicable. After issuance of the
declaration under Section 6 of the Act, admittedly the
possession of the land in question was taken on 4th February,
2003. However, it remains a matter of some dispute before the
Court as to whether 80 per cent compensation, which is
deposited by the beneficiary with the State, had actually been
received by the land owners/claimants, if so, to what extent
and by how many.
15
The Collector had not made or published the award even
at the time of pronouncement of the judgment of the High
Court, in Writ Petition No. 22251 of 2006, on 28th August,
2006. The High Court, in the impugned judgment, has
directed the respondent No.1 to ensure that the Award is made
as early as possible, preferably within a period of three months
from the date of production of the certified copy of that order.
In the counter affidavit filed before this Court, it has been
stated by the State of Uttar Pradesh that the Award was finally
made and published on 9th June, 2008. According to the
appellant, given the fact that the declaration under Section 6
of the Act was dated 22nd August, 2002, then in terms of
Section 11A of the Act, the acquisition proceedings had lapsed
as the award ought to have been pronounced on or before 21st
August, 2004.
Discussion on objects and reasons of the Act
With the enormous expansion of the State’s role in
promoting public welfare and economic development since
independence, the acquisition of land for public purposes, like
16
industrialization, building of institutions, etc., has become far
more numerous than ever before. This not only led to an
increase in exercise of executive powers, but also to various
legislative amendments to the Act. The 1870 Act abolished the
system of uncontrolled direction by arbitrators and in lieu
thereof, required the Collector, when unable to come to terms
with the persons interested in the land which it desired to
acquire, to refer these differences to the Civil Courts. It was
also felt necessary by the framers, to restructure the legislative
framework for acquisition of land so that it is more adequately
informed by this objective of servicing the interests of the
community in harmony with the rights of the individual.
Various amendments were made and certain new provisions
added to the Act by Amendment Act, 68 of 1984, which took
effect from 24th September, 1984. Amongst others, Sections
11A and 17(3A) of the Act were new provisions added by this
enactment. The objects and reasons for amending the Act
were to bring a greater degree of harmony between the
interests of the owners of the land, on the one hand, and the
acquiring authority on the other. In its recommendations, the
17
Law Commission also expressed a view that individuals and
institutions, who are unavoidably deprived of their property
rights, need to be adequately compensated for their loss
keeping in view the sacrifice they have had to make in the
larger interests of the community. The pendency of acquisition
proceedings for long periods causes hardship to the affected
parties; so steps were required to be taken to truncate the
procedural aspect of acquisition proceedings on the one hand,
and to pay adequate compensation to the owners of the land
on the other. By introducing the provisions of Section 11A of
the Act to the normal course of acquisition proceedings,
greater responsibility was intended to be fastened upon the
concerned authorities, whereby they were obliged to make an
award within two years of the declaration made under Section
6 of the Act. The other obvious purpose of the amendment
was that before emergency provisions are invoked by the State
and possession is taken in terms of Section 17(1) of the Act, as
opposed to the normal procedure of acquisition of land where
possession is taken after the making of an award, it was to be
obligatory upon the authorities concerned to pay 80 per cent
18
of the estimated compensation to the land owners, prior to
taking possession of the land in terms of Section 17(3A) of the
Act. Despite the fact that Right to Property in terms of Article
19(1)(f) of the Constitution stood deleted from Chapter III of
the Constitution, vide 44th Constitutional Amendment, 1978,
Article 300A of the Constitution was added by the same
Constitutional Amendment, mandating that ‘no person shall
be deprived of his property save by authority of law’. This
indicates that the Constitution still mandates two aspects in
relation to acquisition of land by the exercise of power of
eminent domain vested in the State. Firstly, such acquisition
has to be by the authority of law; in other words, it has to be
in accordance with the law enacted by the competent
legislature and not by mere executive action. Secondly, there
has to be a public purpose for acquisition of land and the
person interested in such land would be entitled to
compensation.
The objects and reasons for introducing the Bill leading
to the Amendment Act 68 of 1984, have explained the
19
amendments made to the Act. It is not necessary for us to
dwell upon all the amendments carried out in the Act. Suffice
it to refer to the amendment made in the definition of ‘public
purpose’ under Section 3(f) of the Act and to the provisions of
Sections 11A and 17(3A), with which this Court is primarily
concerned in the present case. If I may put it in rather simple
language, the object of the legislation was to create greater
balance between the exercise of power of eminent domain by
the State and the owner’s deprivation of his property by way of
compulsory acquisition and the greater acceptability of
acquisition proceedings amongst land owners. This balance is
sought to be created by introducing higher responsibility and
statutory obligations upon the acquiring authority.
Expeditious and proper payment of fair market value for the
acquired land to the claimants is required in the light of
sacrifice made by them in the larger public interest.
In the case of Devinder Singh & Others v. State of Punjab
and Others [(2008)1 SCC 728], a Bench of this Court took the
view that the provisions of the Act should be strictly
20
construed. Referring to the provisions of the Act, it spelt out
the ingredients of valid acquisition to be, (a) the existence of a
public purpose; and (b) the payment of requisite
compensation. In cases of acquisition of land for a private
company, the existence of a public purpose is not necessary
but all other statutory requirements were held to remain
imperative in character, requiring strict compliance.
Whether the provisions of Sections 17(3A) and 11A of the
Act are mandatory or directory and to what effect?
Let us first examine the general principles that could
help the Court in determining whether a particular provision
of a statute is mandatory or directory.
In ‘Principles of Statutory Interpretation’, 12th Edition,
2010, Justice G.P. Singh, at page 389 states as follows:
“As approved by the Supreme Court: “The
question as to whether a statute is
mandatory of directory depends upon the
intent of the Legislature and not upon the
language in which the intent is clothed.
The meaning and intention of the
legislation must govern, and these are to
be ascertained not only from the
phraseology of the provision, but also by
21
considering its nature, its design and the
consequences which would follow from
construing it the one way or the other”
“For ascertaining the real intention of the
Legislature”, points out Subbarao, J, “the
court may consider inter alia, the nature
and design of the statute, and the
consequences which would follow from
construing it the one way or the other;
the impact of the other provisions
whereby the necessity of complying with
the provisions in question is avoided; the
circumstances, namely, that the statute
provides for a contingency of the noncompliance
with the provisions; the fact
that the non-compliance with the
provisions is or is not visited by some
penalty; the serious or the trivial
consequences, that flow therefrom; and
above all, whether the object of the
legislation will be defeated or furthered”.
If object of the enactment will be defeated
by holding the same directory, it will be
construed as mandatory, whereas if by
holding it mandatory, serious general
inconvenience will be created to innocent
persons without very much furthering the
object of enactment, the same will be
construed as directory. But all this does
not mean that the language used is to be
ignored, but only that the prima facie
inference of the intention of the
Legislature arising from the words used
may be displaced by considering the
nature of the enactment, its design and
the consequences flowing from alternative
construction. Thus, the use of the words
‘as nearly as may be’ in contrast to the
words ‘at least’ will prima facie indicate a
22
directory requirement, negative words a
mandatory requirement ‘may’ a directory
requirement and ‘shall’ a mandatory
requirement.”
Maxwell, in Chapter 13 of his 12th Edition of ‘The
Interpretation of Statutes’, used the word ‘imperative’ as
synonymous with ‘mandatory’ and drew a distinction between
imperative and directory enactments, at pages 314-315, as
follows:
“Passing from the interpretation of the
language of statutes, it remains to
consider what intentions are to be
attributed to the legislature on questions
necessarily arising out of its enactments
and on which it has remained silent.”
The first such question is: when a statute
requires that something shall be done, or
done in a particular manner or form,
without expressly declaring what shall be
the consequence of non-compliance, is
the requirement to be regarded as
imperative (or mandatory) or forms
prescribed by the statute have been
regarded as essential to the act or thing
regulated by it, and their omission has
been held fatal to its validity. In others,
such prescriptions have been considered
as merely directory, the neglect of them
involving nothing more than liability to a
penalty, if any were imposed, for breach
23
of the enactment. “An absolute
enactment must be obeyed or fulfilled
exactly, but it is sufficient if a directory
enactment be obeyed or fulfilled
substantially”.
It is impossible to lay down any general
rule for determining whether a provision
is imperative or directory. “No universal
rule,” said Lord Campbell L.C., “can be
laid down for the construction of statutes,
as to whether mandatory enactments
shall be considered directory only or
obligatory with an implied nullification for
disobedience. It is the duty of Courts of
Justice to try to get at the real intention
of the Legislature by carefully attending
to the whole scope of the statute to be
construed.” And Lord Penzance said: “I
believe, as far as any rule is concerned,
you cannot safely go further than that in
each case you must look to the subject
matter; consider the importance of the
provision that has been disregarded, and
the relation of that provision to the
general object intended to be secured by
the Act; and upon a review of the case in
that aspect decide whether the matter is
what is called imperative or only
directory.”
In a recent judgment of this Court, May George v. Special
Tehsildar and Ors. [(2010) 13 SCC 98], the Court stated the
precepts, which can be summed up and usefully applied by
this Court, as follows:
24
(a) While determining whether a provision is mandatory or
directory, somewhat on similar lines as afore-noticed,
the Court has to examine the context in which the
provision is used and the purpose it seeks to achieve;
(b) To find out the intent of the legislature, it may also be
necessary to examine serious general inconveniences or
injustices which may be caused to persons affected by
the application of such provision;
(c) Whether the provisions are enabling the State to do some
things and/or whether they prescribe the methodology or
formalities for doing certain things;
(d) As a factor to determine legislative intent, the court may
also consider, inter alia, the nature and design of the
statute and the consequences which would flow from
construing it, one way or the other;
(e) It is also permissible to examine the impact of other
provisions in the same statute and the consequences of
non-compliance of such provisions;
25
(f) Physiology of the provisions is not by itself a
determinative factor. The use of the words ‘shall’ or
‘may’, respectively would ordinarily indicate imperative or
directory character, but not always.
(g) The test to be applied is whether non-compliance with
the provision would render the entire proceedings invalid
or not.
(h) The Court has to give due weightage to whether the
interpretation intended to be given by the Court would
further the purpose of law or if this purpose could be
defeated by terming it mandatory or otherwise.
Reference can be made to the following paragraphs of
May George (supra) :
“16. In Dattatraya Moreshwar v. The
State of Bombay and Ors. [AIR 1952 SC
181], this Court observed that law which
creates public duties is directory but if it
confers private rights it is mandatory.
Relevant passage from this judgment is
quoted below:
‘7……..It is well settled that
generally speaking the provisions of
26
the statute creating public duties
are directory and those conferring
private rights are imperative. When
the provisions of a statute relate to
the performance of a public duty
and the case is such that to hold
null and void acts done in neglect of
this duty would work serious
general inconvenience or injustice to
persons who have no control over
those entrusted with the duty and
at the same time would not promote
the main object of legislature, it has
been the practice of the Courts to
hold such provisions to be directory
only, the neglect of them not
affecting the validity of the acts
done.’
17. A Constitution Bench of this Court in
State of U.P. and Ors. v. Babu Ram
Upadhya [AIR 1961 SC 751] decided the
issue observing:
‘29…..For ascertaining the real
intention of the Legislature, the
Court may consider, inter alia, the
nature and the design of the statute,
and the consequences which would
follow from construing it the one
way or the other, the impact of other
provisions whereby the necessity of
complying with the provisions in
question is avoided, the
circumstance, namely, that the
statute provides for a contingency of
the non-compliance with the
provisions, the fact that the noncompliance
with the provisions is or
27
is not visited by some penalty, the
serious or trivial consequences that
flow therefrom, and, above all,
whether the object of the legislation
will be defeated or furthered.’
22. In B.S. Khurana and Ors. v.
Municipal Corporation of Delhi and Ors.
[(2000) 7 SCC 679], this Court considered
the provisions of the Delhi Municipal
Corporation Act, 1957, particularly those
dealing with transfer of immovable
property owned by the Municipal
Corporation. After considering the
scheme of the Act for the purpose of
transferring the property belonging to the
Corporation, the Court held that the
Commissioner could alienate the property
only on obtaining the prior sanction of
the Corporation and this condition was
held to be mandatory for the reason that
the effect of non-observance of the
statutory prescription would vitiate the
transfer though no specific power had
been conferred upon the Corporation to
transfer the property.
23. In State of Haryana and Anr. v.
Raghubir Dayal [(1995) 1 SCC 133], this
Court has observed as under:
‘5. The use of the word `shall' is
ordinarily mandatory but it is
sometimes not so interpreted if the
scope of the enactment, or
consequences to flow from such
construction would not so demand.
Normally, the word `shall' prima
facie ought to be considered
28
mandatory but it is the function of
the Court to ascertain the real
intention of the legislature by a
careful examination of the whole
scope of the statute, the purpose it
seeks to serve and the consequences
that would flow from the
construction to be placed thereon.
The word `shall', therefore, ought to
be construed not according to the
language with which it is clothed
but in the context in which it is
used and the purpose it seeks to
serve. The meaning has to be
described to the word `shall; as
mandatory or as directory
accordingly. Equally, it is settled law
that when a statute is passed for the
purpose of enabling the doing of
something and prescribes the
formalities which are to be attended
for the purpose, those prescribed
formalities which are essential to
the validity of such thing, would be
mandatory. However, if by holding
them to be mandatory, serious
general inconvenience is caused to
innocent persons or general public,
without very much furthering the
object of the Act, the same would be
construed as directory.’ ”
The Legislature in Sections 11A and 17(3A) of the Act has
used the word ‘shall’ in contradistinction to the word ‘may’
used in some other provisions of the Act. This also is a
29
relevant consideration to bear in mind while interpreting a
provision.
The distinction between mandatory and directory
provisions is a well accepted norm of interpretation. The
general rule of interpretation would require the word to be
given its own meaning and the word ‘shall’ would be read as
‘must’ unless it was essential to read it as ‘may’ to achieve the
ends of legislative intent and understand the language of the
provisions. It is difficult to lay down any universal rule, but
wherever the word ‘shall’ is used in a substantive statute, it
normally would indicate mandatory intent of the legislature.
Crawford on ‘Statutory Construction’ has specifically stated
that language of the provision is not the sole criteria; but the
Courts should consider its nature, design and the
consequences which could flow from construing it one way or
the other.
Thus, the word ‘shall’ would normally be mandatory
while the word ‘may’ would be directory. Consequences of noncompliance
would also be a relevant consideration. The word
30
‘shall’ raises a presumption that the particular provision is
imperative but this prima facie inference may be rebutted by
other considerations such as object and scope of the
enactment and the consequences flowing from such
construction. Where a statute imposes a public duty and
proceeds to lay down the manner and timeframe within which
the duty shall be performed, the injustice or inconvenience
resulting from a rigid adherence to the statutory prescriptions
may not be a relevant factor in holding such prescription to be
only directory. For example, when dealing with the provisions
relating to criminal law, legislative purpose is to be borne in
mind for its proper interpretation. It is said that the purpose of
criminal law is to permit everyone to go about their daily lives
without fear of harm to person or property and it is in the
interests of everyone that serious crime be effectively
investigated and prosecuted. There must be fairness to all
sides. (Attorney General's Reference (No. 3 of 1999) (2001) 1 All
ER 577 Reference : Justice G.P. Singh on ‘Principles of
Statutory Interpretation’, 11th Edition 2008). In a criminal
case, the court is required to consider the triangulation of
31
interests taking into consideration the position of the accused,
the victim and his or her family and the public.
The basic purpose of interpretation of statutes is further
to aid in determining either the general object of the legislation
or the meaning of the language in any particular provision. It
is obvious that the intention which appears to be most in
accordance with convenience, reason, justice and legal
principles should, in all cases of doubtful interpretation, be
presumed to be the true one. The intention to produce an
unreasonable result is not to be imputed to a statute. On the
other hand, it is not impermissible, but rather is acceptable, to
adopt a more reasonable construction and avoid anomalous or
unreasonable construction. A sense of the possible injustice of
an interpretation ought not to induce Judges to do violence to
the well settled rules of construction, but it may properly lead
to the selection of one, rather than the other, of the two
reasonable interpretations. In earlier times, statutes imposing
criminal or other penalties were required to be construed
narrowly in favour of the person proceeded against and were
32
more rigorously applied. The Courts were to see whether there
appeared any reasonable doubt or ambiguity in construing the
relevant provisions. Right from the case of R. v. Jones, ex p.
Daunton [1963(1) WLR 270], the basic principles state that
even statutes dealing with jurisdiction and procedural law are,
if they relate to infliction of penalties, to be strictly construed;
compliance with the procedures will be stringently exacted
from those proceedings against the person liable to be
penalized and if there is any ambiguity or doubt, it will be
resolved in favour of the accused/such person. These
principles have been applied with approval by different courts
even in India. Enactments relating to procedure in courts are
usually construed as imperative. A kind of duty is imposed on
court or a public officer when no general inconvenience or
injustice is caused from different construction. A provision of a
statute may impose an absolute or qualified duty upon a
public officer which itself may be a relevant consideration
while understanding the provision itself. (See ‘Maxwell on The
Interpretation of Statutes’, 12th Edition by P. St. J. Langan and
R. v. Bullock, [(1964)1 QB 481])
33
One school of thought has accepted that the word ‘shall’
raises a presumption that the particular provision is
imperative, while the other school of thought believes that
such presumption is merely prima facie, subject to rebuttal by
the other considerations mentioned above. For example, in
M/s. Sainik Motors, Jodhpur & Others v. The State of
Rajasthan [AIR 1961 SC 1480], the word ‘shall’ has been held
to be merely directory.
G.P. Singh in the same edition of the above-mentioned
book, at page 409, stated that the use of the word ‘shall’ with
respect to one matter and use of word ‘may’ with respect to
another matter in the same section of a statute will normally
lead to the conclusion that the word ‘shall’ imposes an
obligation, whereas the word ‘may’ confers a discretionary
power. But that by itself is not decisive and the Court may,
having regard to the context and consequences, come to the
conclusion that the part of the statute using ‘shall’ is also
directory. It is primarily the context in which the words are
34
used which will be of significance and relevance for deciding
this issue.
Statutes which encroach upon rights, whether as regards
person or property, are subject to strict construction in the
same way as penal Acts. It is a recognized rule that they
should be interpreted, if possible, so as to respect such rights
and if there is any ambiguity, the construction which is in
favour of the freedom of the individual should be adopted. (See
‘Maxwell on The Interpretation of Statutes’, 12th Edition by P.
St. J. Langan)
This Court in the case of Devinder Singh (supra) held that
the Land Acquisition Act is an expropriatory legislation and
followed the case of Hindustan Petroleum Corporation v. Darius
Shapur Chennai and Ors. [(2005) 7 SCC 627]. Therefore, it
should be construed strictly. The Court has also taken the
view that even in cases of directory requirements, substantial
compliance with such provision would be necessary.
35
If I analyze the above principles and the various
judgments of this Court, it is clear that it may not be possible
to lay down any straitjacket formula, which could
unanimously be applied to all cases, irrespective of
considering the facts, legislation in question, object of such
legislation, intendment of the legislature and substance of the
enactment. In my view, it will always depend upon all these
factors as stated by me above. Still, these precepts are not
exhaustive and are merely indicative. There could be cases
where the word ‘shall’ has been used to indicate the legislative
intent that the provisions should be mandatory, but when
examined in light of the scheme of the Act, language of the
provisions, legislative intendment and the objects sought to be
achieved, such an interpretation may defeat the very purpose
of the Act and, thus, such interpretation may not be
acceptable in law and in public interest. Keeping in mind the
language of the provision, the Court has to examine whether
the provision is intended to regulate certain procedure or
whether it vests private individuals with certain rights and
levies a corresponding duty on the officers concerned. The
36
Court will still have to examine another aspect, even after
holding that a particular provision is mandatory or directory,
as the case may be, i.e., whether the effect or impact of such
non-compliance would invalidate or render the proceedings
void ab initio or it would result in imposition of smaller
penalties or in issuance of directions to further protect and
safeguard the interests of the individual against the power of
the State. The language of the statute, intention of the
legislature and other factors stated above decide the results
and impacts of non-compliance in the facts and circumstances
of a given case, before the Court can declare a provision
capable of such strict construction, to term it as absolutely
mandatory or directory.
Having analysed the principles of statutory
interpretation, I will now refer to the provisions of Section
17(3A) of the Act. Section 17 of the Act vests the appropriate
Government with special powers to be exercised in cases of
urgency. This provision falls within Part II of the Act. Part II
of the Act deals with the entire scheme of acquisition of land
37
by the State, right from the stage of issuance of a notification
under Section 4 of the Act till making of an award taking
possession of acquired land and its consequential vesting in
the State. However, to some extent, the provisions of Section
17 of the Act are an exception to the provisions under Sections
4 to 16 of the Act. The distinguishing features of normal
acquisition are that after the issuance of notification under
Section 4 of the Act, the State must provide an opportunity to
the owners of the land to object to the acquisition in terms of
Section 5A of the Act, issue a declaration under Section 6 of
the Act, issue notice under Section 9 of the Act and determine
compensation by making an award under Section 11 of the
Act. However, under the scheme of Section 17 of the Act, the
Government can take possession of the property on the
expiration of 15 days from publication of notice mentioned in
Section 9(1) of the Act. Furthermore, the provisions of Section
5 of the Act, i.e., the right of the owner to file objection can be
declared to be inapplicable. Besides these two significant
distinctions, another important aspect that the land vests in
the Government under Section 16 of the Act only after the
38
award is made and possession of the land is taken, while
under Section 17(1), at the threshold of the acquisition itself,
the land could vest absolutely in the Government free from all
encumbrances. The possession of the acquired property has
to be taken by the Collector in terms of Sections 17(2) and
17(3) of the Act. Section 17(3A) of the Act, as already noticed,
was introduced by the Amendment Act 68 of 1984 for the
purposes of safeguarding the interests of the claimants and
required the payment of 80 per cent of the estimated
compensation before taking possession. At this stage itself, it
will be useful to refer to the relevant provisions of Section 17
of the Act.
Section 17 reads as under:
“17. Special powers in case of urgency. –
(1) In cases of urgency whenever the
appropriate Government, so directs, the
Collector, though no such award has
been made, may, on the expiration of
fifteen days from the publication of the
notice mentioned in section 9, subsection
(1) take possession of any land
needed for a public purpose. Such land
shall thereupon vest absolutely in the
Government, free from all encumbrances.
39
(2) xxxxxx
(3) xxxxxx
(3A) Before taking possession of any land
under sub-section (1) or sub-section (2),
the Collector shall, without prejudice to
the provisions of sub-section (3)(a) tender
payment of eighty per centum of the
compensation for such land as estimated
by him to the person interested entitled
thereto, and (b) pay it to them, unless
prevented by some one or more of the
contingencies mentioned in section 31,
sub-section (2),and where the Collector is
so prevented, the provisions of section
31, sub-section (2), (except the second
proviso thereto), shall apply as they apply
to the payment of compensation under
that section.
(3B) The amount paid or deposited under
section (3A), shall be taken into account
for determining the amount of
compensation required to be tendered
under section 31, and where the amount
so paid or deposited exceeds the
compensation awarded by the Collector
under section 11, the excess may, unless
refunded within three months from the
date of Collector's award, be recovered as
an arrear of land revenue.
(4) In the case of any land to which, in
the opinion of the appropriate
Government, the provisions of subsection
(1) or sub-section (2) are
applicable, the appropriate Government
40
may direct that the provisions of section
5A shall not apply, and, if it does so
direct, a declaration may be made under
section 6 in respect of the land at any
time after the date of the publication of
the notification under section 4, subsection
(1).”
Section 17(3A) of the Act makes it obligatory on the part
of the authority concerned to tender/pay 80 per cent of the
compensation for the acquired land, as estimated by the
Collector, to the persons interested and entitled thereto;
unless prevented by any of the contingencies mentioned under
Section 31(2) of the Act. The use of the word ‘shall’ in Section
17(3A) indicates that the enactors of law desired that the
above mentioned procedure should be complied with by the
authority concerned prior to taking of possession. That is
why the legislature has even taken care to make a provision
for deposit of due compensation in court in terms of Section
31(2) of the Act, where an authority is prevented from
tendering the amount to the claimants for reasons stated in
Section 31(1) of the Act. 80 per cent of the estimated
compensation is to be deposited in the Court to which
41
reference under Section 18 of the Act would lie. This clearly
shows that there is statutory obligation upon the authorities
concerned to tender to the interested persons, compensation
in accordance with law. Deposit of money, certainly, is the
condition precedent to taking of possession as is amply clear
from the language ‘before taking possession of any land’. The
amount so deposited or paid in terms of Section 17(3A) of the
Act will be taken into account for determining the amount of
compensation required to be tendered under Section 31 of the
Act and provides for the recovery of amounts if it exceeds the
awarded amount. Section 17(3A) unambiguously provides a
complete mechanism of taking possession and the
requirement of payment of 80 per cent of estimated
compensation to the claimants.
Now, I would examine WHAT ARE THE
CONSEQUENCES of default in compliance to the provisions of
Section 17(3A) of the Act. The said Section is completely silent
on such consequences. Where the Legislature has, in specific
terms, provided for the extent of payment, mode of payment
42
and even the difficulties which are likely to arise, i.e, where a
person may not be entitled to receive the compensation or in
any other eventuality such as where the compensation cannot
be paid for the reasons stated in Section 31(1) of the Act, there
the Legislature in its wisdom has provided no contingencies
and/or consequences of non-deposit of this money. This is in
complete contradistinction to the provisions contained in
Sections 6 and 11A of the Act. Section 6 provides that no
declaration shall be issued where the period specified in the
first proviso to Section 6(1) of the Act has expired. In other
words, it spells out the consequences of failure to do an act
within the stipulated period. Similarly, Section 11A of the Act
provides that the acquisition proceedings shall lapse where the
Collector fails to make an award within a period of two years
from the date of publication of declaration under Section 6 of
the Act.
Thus, the legislative intent is very clear. Keeping the
objects and reasons for amendment in mind, the Act strives
for a fair balance between the rights of private individuals and
43
the power of eminent domain of the State and also attempts to
ensure expeditious disbursement of compensation, as
determined in accordance with law, to the claimants. The
legislature has provided for every contingency for tendering
payment, while remaining silent about consequences flowing
from default under some other provisions. Sections 11A and
17(3A) of the Act are clear illustrations of clarity and purpose
in legislative intent. When the framers of law have not
provided for any penal consequences for default in compliance
to Section 17(3A), then it will be uncalled for to provide such
consequences by judicial interpretation. While interpreting the
provisions for compensation, the Court can provide such
interpretation as would help to bridge the gaps left by the
Legislature, if any, in implementation of the provisions of the
Act. But it will hardly be permissible for the Court to
introduce such consequences by way of judicial dicta, like
requiring lapse of acquisition proceedings. This is not a
matter covered by the principles of judicial interpretation.
44
It is a well settled canon of statutory interpretation that
the courts would neither add nor subtract from the plain
language of the statutory provision. In the present case also,
there is hardly any justification for the courts to take any
contrary view. Once the land has vested in the State and
there being no provision for re-vesting the land in the original
owners under the provisions of the Act, then it will be in
consonance with the scheme of the Act and legislative intent to
give an interpretation that would allow provisions of Section
17(1) to operate without undue impediment and keep the
vesting of land in the State intact. Otherwise, in some cases
the purpose for which such lands were acquired might stand
frustrated, while in other cases the purpose of acquisition
might have already been achieved and, therefore, divesting
State of its title and possession in the acquired land will be
incapable of performance. Under such circumstances, then,
to interpret Section 17(3A) of the Act to be so mandatory in its
absolute terms that the non-payment of money would result in
vitiating or lapsing entire acquisition proceedings, can hardly
be justified on the strength of any known principle of
45
interpretation of statutes. This question arises more often, as
the provisions of Section 17 of the Act are being invoked by the
Union of India and State Governments very frequently, so, the
consequences of this default, within the framework of law and
anything short of invalidation of the acquisition proceedings
should be stated by the court with reference to the facts and
circumstances of each case. It is a complete safeguard
provided to the land owner inasmuch as the compensation
stipulated under Section 17(3A) of the Act should be paid in
terms of the provisions of the Act so that the owner is not
made to suffer on both counts i.e. he is deprived of his land as
well as compensation. It will be unfair for the authorities
concerned not to pay the compensation as contemplated
under the provisions of the Act. It would be just and fair to
read into the provisions of the Section 17(3A) as imposing an
obligation on the part of the authorities concerned/the
Collector to pay the compensation within the time specified
under Section 17(3A). Of course, no specific time, within
which the payment has to be made in terms of Section 17(1)
has been stated in the provision. But, it is a settled principle
46
of law that wherever specific limitations are not stated, the
concept of ‘reasonable time’ would become applicable. So,
even if it is argued that there is no specific time contemplated
for payment/deposit of 80 per cent of the estimated
compensation, even then the claimants would be entitled to
receive the amount expeditiously and in any case within very
reasonable time. If the authorities are permitted to take
possession of the land without payment of the amounts
contemplated under Section 17(3A) of the Act, then it would
certainly amount to abuse of power of eminent domain within
its known legal limitations. The authorities should discern the
distinction spelt out under Section 16 of the Act on the one
hand and Section 17(1) read with Section 17(3A) of the Act on
the other.
Let me examine the judgment of this Court dealing with
the provisions of Section 17(3A) of the Act. The judgments of
different High Courts have been brought to the notice of this
Court, taking divergent views on the question whether the
provisions of Section 17(3A) are mandatory or directory. Some
47
of these judgments, I would shortly refer to, if necessary.
However, I may notice that none of these judgments have
specifically discussed the consequences of non-adherence to
the provisions of Section 17(3A) of the Act. A Bench of Delhi
High Court in the case of Banwari Lal & Sons Pvt. Ltd. vs.
Union of India & Ors., [1991 (1) DRJ (Suppl.) 317 (Delhi
Reported Journal)], whilst quashing the notification issued
under Section 4 read with Section 17(1) of the Act on the
ground of factual lack of urgency for acquisition, held that
there was non-compliance to the provisions of Section 17(3A)
of the Act. Of course, the High Court took the view that the
notification issued under Section 4 read with Section 17(1) of
the Act was not maintainable and while quashing the said
notification, it also held that there was violation of provisions
of Section 5A of the Act and, in fact, no urgency existed. There
was no direct discussion as to whether the provisions of
Section 17(3A) of the Act are mandatory or directory. However,
this judgment neither provides any reasoning nor actually
states the consequences of non-compliance with the provisions
of Section 17(3A). For these reasons, this judgment is of no
48
help to the parties appearing in the present appeal. Against
the judgment of Delhi High Court in Banwari Lal (supra), the
Special Leave Petition preferred before this Court was
dismissed at the admission stage itself.
In the case of Union of India & Ors. v. Krishan Lal Arneja
& Ors., [(2004) 8 SCC 453], a part of the acquisition was
challenged and writ petitions had been filed for quashing the
notification dated 6th March, 1987 issued under Section 4 and
Section 17(1) of the Act by Banwari Lal and other owners of
the acquired lands. These writ petitions were allowed by a
learned Single Judge of the High Court, appeal against which
was dismissed by the Division Bench of the High Court. While
considering the appeal against the order of the Division Bench,
this Court also dismissed the same. In the appeal, arguments
had also been advanced that since the Government before this
Court had not made the payment of 80 per cent of estimated
compensation in terms of Section 17(3A) of the Act, the
acquisition had lapsed. However, in paragraph 36 of that
judgment, this Court declined to deal with these contentions
49
as it had dismissed the appeal on other grounds. The Court
incidentally observed that it was not a fair stand to be taken
by the State before the Court to argue that it could de-notify
the acquired land on the plea that it had failed to comply with
the statutory provisions of the Act. In short, the question in
controversy in the present case was not actually pronounced
upon by the Court in that case.
The question of the provisions of Section 17(3A) of the Act
being mandatory or directory again fell for consideration before
this Court in the case of Tika Ram & Ors. v. State of U.P. &
Ors. [(2009) 10 SCC 689]. In this case, challenge to the
constitutional validity of the provisions of Section 17 was also
made. The Court, while holding that the said provisions are
constitutional, also declared that the provisions of Section
17(3A) were not mandatory and their non-compliance would
not vitiate the whole acquisition proceedings. The following
paragraphs of the judgment are relevant:
“91. However, the question is as to what
happens when such payment is not made
50
and the possession is taken. Can the
whole acquisition be set at naught?
92. In our opinion, this contention on
the part of the appellants is also
incorrect. If we find fault with the whole
acquisition process on account of the
non-payment of 80% of the
compensation, then the further question
would be as to whether the estimation of
80% of compensation is correct or not. A
further controversy can then be raised by
the landlords that what was paid was not
80% and was short of 80% and therefore,
the acquisition should be set at naught.
Such extreme interpretation cannot be
afforded because indeed under Section 17
itself, the basic idea of avoiding the
enquiry under Section 5-A is in view of
the urgent need on the part of the State
Government for the land to be acquired
for any eventuality discovered by either
sub-section (1) or sub-section (2) of
Section 17 of the Act.
93.
The only question that would remain is
that of the estimation of the
compensation. In our considered view,
even if the compensation is not paid or is
short of 80%, the acquisition would not
suffer. One could imagine the
unreasonableness of the situation. Now
suppose, there is state of emergency as
contemplated in Section 17(2) of the Act
and the compensation is not given, could
the whole acquisition come to a naught?
It would entail serious consequences.
51
94.
This situation was considered, firstly, in
Satendra Prasad Jain v. State of U.P. It
was held therein that once the possession
is taken as a matter of fact, then the
owner is divested of the title to the land.
The Court held that there was then no
question of application of even Section
11-A. Commenting upon Section 11-A, it
was held that that the Section could not
be so construed as to leave the
Government holding title or the land
without an obligation to determine the
compensation, make an award and pay to
the owner the difference between the
amount of the award and the amount of
the 80% of the estimated compensation.
The three-Judge Bench of the Court took
the view that even where 80% of the
estimated compensation was not paid to
the landowners, it did not mean that the
possession was taken illegally or that the
land did not vest in the Government. In
short, this Court held that the
proceedings of acquisition are not
affected by the nonpayment of
compensation. In that case, the Krishi
Utpadan Mandi Samiti, for which the
possession was made, sought to escape
from the liability to make the payment.
That was not allowed. The Court, in para
17, held as under : (Satendra Prasad Jain
case, SCC p. 375, para 17)
"17. In the instant case, even that
80% of the estimated compensation
was not paid to the appellants
although Section 17 (3-A) required
52
that it should have been paid before
possession of the said land was
taken but that does not mean that
the possession was taken illegally or
that the said land did not thereupon
vest in the first respondent. It is, at
any rate, not open to the third
respondent, who, as the letter of the
Special Land Acquisition Officer
dated 27.6.1990 shows, failed to
make the necessary monies
available and who has been in
occupation of the said land ever
since its possession was taken, to
urge that the possession was taken
illegally and that, therefore, the said
land has not vested in the first
respondent and the first respondent
is under no obligation to make an
award."
95. Further, in a judgment of this Court
in Pratap v. State of Rajasthan, a similar
view was reported. That was a case under
the Rajasthan Urban Improvement Act,
1987, under which the acquisition was
made using Section 17 of the Act. The
Court took the view that once the
possession was taken under Section 17 of
the Act, the Government could not
withdraw from that position under
Section 18 and even the provisions of
Section 11-A were not attracted. That was
of course a case where the award was not
passed under Section 11-A after taking of
the possession. A clear-cut observation
came to be made in that behalf in para
12, to the effect that the non-compliance
with Section 17 of the Act, insofar as
53
payment of compensation is concerned,
did not result in lapsing of the land
acquisition proceedings. The law laid
down by this Court in Satendra Prasad
Jain v. State of U.P. was approved. The
Court also relied on the decision in P.
Chinnanna v. state of A.P. and Awadh
Bihari Yadav v. State of Bihar, where
similar view was taken regarding the land
acquisition proceedings not getting
lapsed. The only result that may follow by
the non-payment would be the payment
of interest, as contemplated in Section 34
and the proviso added thereto by the
1984 Act. In that view, we do not wish to
further refer the matter, as suggested by
Shri Trivedi, learned Senior Counsel and
Shri Qamar Ahmad, learned counsel for
the appellants. Therefore, even on the
sixth question, there is no necessity of
any reference.”
As is obvious from the above paragraphs, there is an
indefeasible obligation on the part of the Government to make
the payment in terms of Section 17(3A) of the Act but noncompliance
thereto could not result in vitiation of the
acquisition proceedings. The observations made by this Court
in the case of Satendra Prasad Jain (supra), in paragraph 17,
suggest that the Government was required to hold title to the
acquired land coupled with its obligation to determine the
54
compensation, make the award and then to pay to the owner
the difference between the amount of 80 per cent of the
estimated compensation and the amount finally determined.
The Court even went to the extent of observing that nonpayment
of 80 per cent of the estimated compensation per se
does not mean that possession was taken illegally or that the
said land did not thereupon vest in the Government. This
decision does provide any reasoning and conclusions which
support the view that Section 17(3A) of the Act is not a
mandatory provision. Following this judgment, another Bench
of this Court in the case of Pratap & Anr. v. State of Rajasthan
[(1996) 3 SCC 1] took the same view.
However, another Bench of this Court, in the case of
Rajender Kishan Gupta v. Union of India [(2010) 9 SCC 46],
had made certain observations which were at some variance to
the dicta of this Court in the cases referred above. In that
case, neither the validity nor the effects of non-compliance
with Section 17(3A) of the Act were directly in issue. The
challenge was to a notification issued under Section 4(1) of the
55
Act for the land which was subsequently needed for the Metro
Project in Delhi. The challenge was primarily based on the
ground that the land could only be acquired under the Metro
Rail Construction Works Act, 1978 and the emergency clause
could not be used as a way to dispense with enquiry under
Section 5A of the Act. The Court, while dismissing the appeal
preferred by the claimants and rejecting the contentions in
paragraph 29, made the following observations :
“In the light of the above discussion, we
are satisfied that the existence of public
purpose and urgency in executing the
project before the Commonwealth Games,
the adjoining land belonging to DDA
being forest land as per the notification
and also of the fact that the respondents
have fully complied with the mandatory
requirements including deposit of 80% of
the compensation amount, we are in
entire agreement with the stand taken by
the respondents as well as the conclusion
of the High Court.”
The Bench, dealing with the matter, did use the
expression ‘mandatory requirements, including deposit of 80
per cent of the compensation amount’, but there was no
discussion or reasoning of the effects and consequences of
56
such default, anywhere in the judgment, before it has been
concluded that the said provisions are mandatory. Thus,
these observations do not come to the aid of the appellants in
challenging the entire acquisition proceedings on this ground.
Consistent with the view expressed by this Court in the
cases referred (supra), I am of the considered view that the
provisions of Section 17(3A) of the Act are not mandatory.
Such a conclusion can safely be arrived at, even for the reason
that the Court would have to read into the provisions of
Section 17(3A) consequences and a strict period of limitation
within which amount should be deposited, which has not been
provided by the Legislature itself in that section. The
consequences and contingencies arising from non-compliance
of the said provisions have not been stated in the Act. Once
the land has vested in the Government, non-compliance with
the obligation of payment of 80 per cent of estimated
compensation would not render the possession taken under
Section 17(1) as illegal. The land cannot be re-vested or
reverted back to the claimants as no provisions under the Act
57
so prescribe. Furthermore, if the interpretation put forward by
the appellants is accepted, it would completely frustrate the
objects and purpose of the Act, rather than advancing the
same. The expression ‘shall’ used in Section 17(3A) has to be
understood in its correct perspective and is not to be
construed as suggestive of the provisions being absolutely
mandatory in its application. Inter alia for these reasons and
as per the above discussions, I hold that the provisions of
Section 17(3A) are not mandatory. They are directive
provisions, though their compliance is necessary in terms of
the Act.
Having held as above, I hasten to add that the obligation
on the part of the Government or concerned authority to
deposit the amount prior to taking possession under Section
17(1) of the Act should essentially be complied with. The
amount of 80 per cent of the estimated compensation in terms
of Section 17(3A) should be deposited. Once we read the
provisions of Sections 17(1) and 17(3A) conjunctively, it
implies that the amounts are to be deposited within 15 days
58
from the publication of the notice in terms of Section 9(1) of
the Act and before taking of possession of the acquired land.
The Legislature has sufficiently indicated that the payment of
the due 80 per cent of compensation should be made at the
earliest and, particularly, before possession is taken. Noncompliance
of the provisions of Section 17(3A) would not
vitiate the acquisition proceedings, but depending on the facts
of a given case, the payment should be made within the time
indicated and in any case within a reasonable time, and the
claimant should then be entitled to additional benefits for
such non-compliance. The Court would fill a part of the gap
which has remained unfilled by the Legislature.
Irrespective of whether the provision is held to be
mandatory or directory, compliance with its substance is
equally important. In either case, the authority entrusted with
a duty is not absolved of its obligation to perform the specified
duty or obligation in the manner stated in law. It is primarily
the consequences which result from non-performance of duty,
which are of significance in determining the impact of
59
mandatory or directory nature of a provision. Normally, in
both cases, some consequences should flow from nonperformance.
Even if the provisions of Section 17(3A) are
directory, as held by me above, the deposit of 80 per cent of
estimated compensation within the period of limitation i.e. 15
days and prior to taking possession of the land, has to be
made. There is no ambiguity in this requirement. Thus, it
shall be the duty of the Court to fill the lacuna (i.e., the
consequences of non-payment of compensation) to complete
the chain of the legislative scheme contained in Section 17 of
the Act. Having taken recourse to the emergency provisions
and having taken possession of the land, the Government and
its authorities cannot be permitted to defer the payment of the
requisite amount, in terms of Section 17(3A) of the Act,
indefinitely or for an unduly long period. A responsibility is
cast upon the authorities concerned to make payments within
time and not unduly cause inconvenience and harassment to
persons interested in the compulsorily acquired land and who
have been deprived of possessory benefits also. Persons who
are so deprived of their land and possessory benefits thereof,
60
are not in a position to carry out agricultural activity or derive
any other benefit as they might have been deriving prior to
compulsory acquisition/taking possession of the land. In
other words, it is a case of deprivation of property and to some
extent deprivation of sources of income. Without hesitation,
the claimants/owners of land should be and ought to be
entitled to certain additional benefits within the legislative
framework of the Act. Certain additional and interest benefits
are provided under Sections 23(1A), 23(2), 28 and 34 of the
Act. The legislature has even taken care of providing higher
rates of interest where the possession of the land has already
been taken and compensation has not been paid or deposited
within the specified time or in the manner prescribed under
Section 34 of the Act. Proviso to this Section states that where
the compensation payable, or any part thereof, has not been
paid or deposited within a period of one year from the date on
which possession is taken, interest at the rate of 15 per cent
per annum shall be payable from the date of expiry of the said
period of one year, calculated on the amount of compensation
or part thereof which has not been paid or deposited before
61
the date of such expiry, until the time such payment is finally
made. We have to read the provisions of Section 34 together
with the provisions of Sections 17(1) and 17(3A) of the Act.
They have to be construed harmoniously, keeping in mind the
object sought to be achieved by a conjoint reading of these
provisions. The expression ‘before taking possession of the
land’ has been used in Section 17 read with Section 17(3A)
and in Section 34 as well. Once the Government has invoked
the emergency provisions, it is pre-supposed that the
Government needs the land urgently and, in its wisdom, has
decided that it is not in public interest to go through the
normal procedure prescribed for acquisition and payment of
compensation under Part II of the Act. It requires immediate
possession of the land for achievement of the purpose for
which land was required. As the Government would take
possession by depriving the land owners of some of their
rights, as would have been available to them under normal
acquisition procedure, the Legislature has created special
safeguards in their favour. Firstly, they would be given 15
days notice prior to taking of possession of the land (Section
62
9(1) of the Act). Secondly, 80 per cent of the estimated
compensation shall be paid to them in terms of Section 17(3A)
of the Act, before the possession is taken. Thus, the
Legislature has balanced the rights and obligations between
the parties. Section 34, therefore, cannot be read so as to
destroy the protections or safeguards provided to
claimants/owners of the land under Section 17 of the Act.
These provisions must be read harmoniously. These
provisions should be construed so as to give benefit to the
owners of the land against compulsory acquisition, rather
than accepting an interpretation which would defeat the
benefits intended by the Legislature. The Legislature was fully
aware of the provisions of Section 34 while introducing Section
17(3A) into the Act, as both the provisions were introduced by
the same Amending Act of 1984. This clearly demonstrates
the legislative intent that the protections specified under
Section 17(1) would operate in their own field and the
provisions of Section 34 would also apply in its own sphere. It
will be unfair, if the Government takes possession of the
property within 15 days of the notice issued under Section 9(1)
63
(as is contemplated under Section 17(1) of the Act) and does
not make payment of compensation for a long period, with no
additional liability whatsoever. It appears to me that this is not
the legislative intent that the Government would not be liable
to pay higher rate of interest where it has taken possession of
the land in exercise of its powers under Section 17 of the Act.
It will be unfair if the liability to pay higher rate of interest in
terms of Section 34 would arise only after a period of one year
from the date of possession even in cases of emergent
acquisition. Such an interpretation may result in frustrating
the balance sought to be created by the Legislature. For these
reasons, I am of the considered view that the statutory benefit
contained in Section 34 of the Act should be made applicable
to the provisions of Section 17(1) read with Section 17(3A) in
the manner that it would give the requisite benefit to the
owners/claimants of the land rather than deprive them of
both, their land and income, without any additional benefit
despite non-compliance of the provisions of the Act. Thus, the
owners/claimants should be entitled to receive, on the
strength of these provisions and alike, the interest payable
64
under the proviso to Section 34 i.e. interest at the rate of 15
per cent per annum from the date of expiry of the period of 15
days as stated under Section 17(1) and from taking of
possession of the land from the owners/persons interested in
the land till payment of compensation in terms of Section
17(3A) of the Act.
These conditions have to be satisfied cumulatively and
not alternatively, to give rise to the liability to pay interest of
15 per cent from the date afore-stated. This approach that I
am adopting is restricted in application to the acquisitions
made by the Government in exercise of its emergency powers
under Section 17 of the Act. Section 34 would otherwise
operate in its own sphere and only after the lapse of the period
specified in the proviso. The conclusion of the above
discussion is that non-compliance of provisions of Section
17(1) read with Section 17(3A) would not render the
acquisition proceedings invalid or void ab initio in law however,
liability to pay interest at the rate of 15 per cent per annum
would arise from the date and for the period afore-noticed.
65
Do the provisions of Section 11A apply to the acquisition
proceedings commenced by the Government in exercise of
its powers of urgency under Section 17 of the Act?
I have already noticed that Section 11A of the Act was
introduced into the statute book by the Legislature vide Land
Acquisition (Amendment) Act (68 of 1984). This provision was
introduced primarily to provide safeguards and to secure the
interests of owners/persons interested, whenever their land
was acquired under the provisions of the Act. Section 11A of
the Act reads as under :
“11A. Period within which an award
shall be made.—(1) The Collector shall
make an award under section 11 within a
period of two years from the date of the
publication of the declaration and if no
award is made within that period, the
entire proceedings for the acquisition of
the land shall lapse:
Provided that in a case where the said
declaration has been published before the
commencement of the Land Acquisition
(Amendment) Act, 1984, the award shall
be made within a period of two years from
such commencement.
Explanation.-In computing the period of
two years referred to in this section the
period during which any action or
proceeding to be taken in pursuance of
66
the said declaration is stayed by an order
of a Court shall be excluded.”
A bare reading of the above provision shows that the
Legislature places an obligation upon the Collector to make an
award at the earliest. Wherever the award under Section 11 of
the Act has not been made within two years from the date of
publication of the declaration, the entire proceedings for
acquisition of land shall lapse. Explanation to Section 11A of
the Act further excludes from this period, any period during
which any action or proceeding, to be taken in pursuance of
the said declaration, is stayed by an order of a Court which
had been in force. Exclusion of no other period is
contemplated under this provision. Thus, a definite intention
of the framers of law is clear that the award should be made at
the earliest and, in any case, within a maximum period of two
years from the declaration under Section 6 of the Act, if the
acquisition proceedings are to survive. The acquisition under
the Act being compulsory acquisition, a safeguard or right has
been provided to the private party against the State. Thus, the
statute imposes a duty upon the State to act within time and
67
also provides for consequences that shall ensue in the event of
default. These consequences are of a very serious nature,
whereby the entire acquisition proceedings shall stand lapsed.
This would render the land free from acquisition or any
restriction and title over the land would stand reverted to the
owners/persons interested.
I have already discussed in some detail the principles
which will help the Court in determining whether a provision
is directory or mandatory. It is clear from the substance of the
language and from the intention of the legislature that the
right created in favour of the citizen and the duties imposed on
the State should be construed strictly. Section 11A of the Act
provides for discharge of obligations within the specified time
and there are serious consequences of such non-fulfillment.
This would clearly lead to the conclusion that the provisions of
Section 11A of the Act are capable of strict construction and
are mandatory in their application. In number of cases,
including the case of Mohan & Anr. v. State of Maharahtra
[(2007) 9 SCC 431], this Court has already held that Section
68
11A of the Act is mandatory. This view, with respect, and for
the reasons recorded above, I follow.
A three-Judge Bench of this Court in the case of
Satendra Prasad Jain (supra) went further to specifically
consider the question as to whether the provisions of Section
11A of the Act were attracted and, if so, whether they should
be strictly construed and where the possession of the acquired
land is taken and it is vested in the Government under Section
17 of the Act, whether the acquisition proceedings could lapse
in terms of Section 11A of the Act. Answering the question in
the negative, the Court stated that the Government could not
withdraw from the acquisition under Section 48 of the Act and
claim the benefit of its own default in not making an award
within the period of two years. The Court laid down the
following dictum:
“15. Ordinarily, the Government can take
possession of the land proposed to be
acquired only after an award of
compensation in respect thereof has been
made under Section 11. Upon the taking
of possession the land vests in the
Government, that is to say, the owner of
the land loses to the Government the title
69
to it. This is what Section 16 states. The
provisions of Section 11-A are intended to
benefit the landowner and ensure that
the award is made within a period of two
years from the date of the Section 6
declaration. In the ordinary case,
therefore, when Government fails to make
an award within two years of the
declaration under Section 6, the land has
still not vested in the Government and its
title remains with the owner, the
acquisition proceedings are still pending
and, by virtue of the provisions of Section
11-A, lapse. When Section 17(1) is
applied by reason of urgency,
Government takes possession of the land
prior to the making of the award under
Section 11 and thereupon the owner is
divested of the title to the land which is
vested in the Government. Section 17(1)
states so in unmistakable terms. Clearly,
Section 11-A can have no application to
cases of acquisitions under Section 17
because the lands have already vested in
the Government and there is no provision
in the said Act by which land statutorily
vested in the Government can revert to
the owner.
16. Further, Section 17(3-A) postulates
that the owner will be offered an amount
equivalent to 80 per cent of the estimated
compensation for the land before the
Government takes possession of it under
Section 17(1). Section 11-A cannot be so
construed as to leave the Government
holding title to the land without the
obligation to determine compensation,
make an award and pay to the owner the
difference between the amount of the
award and the amount of 80 per cent of
the estimated compensation.”
70
This judgment was followed by another Bench of this
Court in the case of Awadh Bihari Yadav & Ors. v. State of
Bihar & Ors. [(1995) 6 SCC 31], which held, “…we, therefore,
hold that the land acquisition proceedings in the instant case
did not lapse…”.
The principle of law stated in Satendra Prasad Jain
(supra) was again followed by this Court in the case of P.
Chinnanna & Ors. v. State of A.P. & Ors. [(1994) 5 SCC 486]
and Pratap (supra) and in the case of Allahabad Development
Authority v. Nasiruzzaman & Ors. [(1996) 6 SCC 424], this
Court held as under :
“In the impugned judgment, it would
appear that the learned Judges asked the
counsel to verify whether the award came
to be made within two years, as
indicated. The counsel on verification had
stated that the award was not made
within two years from the commencement
of the Amendment Act, namely, 24-9-
1984. Consequently, the declaration was
given that the notification under Section
4(1) and the declaration under Section 6
stood lapsed. This question was
examined by this Court in Satendra
Prasad Jain v. State of U.P. and Awadh
Bihari Yadav v. State of Bihar and held
that Section 11-A does not apply to cases
of acquisitions under Section 17 where
possession was already taken and the
land stood vested in the State. The
71
notification under Section 4(1) and
declaration under Section 6 do not lapse
due to failure to make an award within
two years from the date of the
declaration. The view of the High Court is
erroneous in law.”
In a very recent judgment of a Division Bench of this
Court, (to which, one of us, Asok Kumar Ganguly, J. was a
member) in the case of Banda Development Authority, Banda v.
Moti Lal Agarwal & Ors. [2011 (5) SCALE 173], this Court
followed the aforesaid view with further clarification. Usefully,
paragraphs 33, 36 and 38 of the said judgment can be referred
to at this stage, which read as under :
“33. XXX XXX XXX
… v) If beneficiary of the acquisition is an
agency/instrumentality of the State and
80% of the total compensation is
deposited in terms of Section 17(3A) and
substantial portion of the acquired land
has been utilized in furtherance of the
particular public purpose, then the Court
may reasonably presume that possession
of the acquired land has been taken.
XXX XXX XXX
36. Once it is held that possession of the
acquired land was handed over to the
BDA on 30.6.2001, the view taken by the
High Court that the acquisition
72
proceedings had lapsed due to noncompliance
of Section 11A cannot be
sustained…...
XXX XXX XXX
38. In the result, the appeal is allowed.
The impugned order is set aside and the
writ petition filed by Respondent No. 1 is
dismissed with cost quantified at Rs.
1,00,000/-. Respondent No. 1 shall
deposit the amount of cost with the
Appellant within a period of two months
from today.”
However, the learned counsel appearing for the appellant
has placed reliance upon a judgment of this Court in the case
of Yusufbhai Noormohmed Nendoliya v. State of Gujarat [(1991)
4 SCC 531] to contend that the provisions of Section 11A of
the Act are applicable to the acquisition under Section 17 as
well. For non-adherence to those provisions, the entire
acquisition proceeding should be declared to have lapsed and
the applicants should be entitled to their lands free from any
encumbrance. Let me analyze this judgment to appreciate the
contention raised by the counsel appearing for the appellants.
In this case, the appellants were occupants of the lands
73
sought to be acquired by the State of Gujarat for the purposes
of establishing North Gujarat University and notification under
Section 6 of the Act in respect of the said land was issued on
12th May, 1988. An interim order restraining the State from
taking possession was granted by the Court. However, the
Acquisition Officer proceeded to issue a notice under Section
9(1) of the Act and determined the compensation payable. As
the award had not been made, the appellants therein had
made a representation to the Government that the award had
not been made within the period of two years mentioned under
Section 11A of the Act and, therefore, the acquisition
proceedings had lapsed. This plea was rejected. The
appellants filed an application challenging the said decision,
praying for a declaration that the acquisition proceedings had
lapsed. The Division Bench of the Gujarat High Court took the
view that the explanation to Section 11A is not confined to
stay of making of the award pursuant to notification under
Section 6, but it is widely worded and covers in its sweep the
entire period during which any matter or proceedings due to
be taken are stayed by a competent Court. This decision was
74
challenged before this Court. In other words, this Court, in
Yusufbhai (supra), was primarily concerned with the
interpretation of Explanation to Section 11A of the Act and
was determining the period which needs to be excluded while
computing the limitation period of two years provided for the
making of an award. While rejecting the view taken to the
contrary by a Single Judge of the Kerala High Court, this
Court made a reference to taking of possession under Section
17 of the Act and held :
“In the first place, as held by the learned
Single Judge himself, where the case is
covered by Section 17, the possession can
be taken before an award is made and we
see no reason why the aforesaid
expression in the Explanation should be
given a different meaning depending
upon whether the case is covered by
Section 17 or otherwise… The benefit is
that the award must be made within a
period of two years of the declaration,
failing which the acquisition proceedings
would lapse and the land would revert to
the landholder…”.
It is obvious from a bare reading of the above observation
that the question of applicability of Section 11A to acquisition
75
proceedings under Section 17 was not in issue before the
Court. This controversy was neither argued nor was it even
remotely necessary for the adjudication of the dispute between
the parties. These observations are merely an obiter of the
Court, which is made to support its conclusion in paragraph 8
of the judgment and cannot be treated as ratio decidendi of the
judgment or a precedent for the proposition raised in the
present case. The learned counsel attempted to argue that the
expression ‘whether the case is covered by Section 11 or
otherwise’ unequivocally states the principle of law that
Section 11A is applicable to the present case. I am unable to
accept this contention as it is not an authority for the
proposition. This controversy was never raised before the
Bench. The argument raised on behalf of the appellants is,
therefore, misplaced.
A half hearted attempt was also made by the learned
counsel for the appellants to advance the argument that there
is difference of opinion by equi Benches of this Court, in the
case of Satendra Prasad Jain (supra) on the one hand and
76
Yusufbhai Noormohmed Nendolia (supra) on the other and,
therefore, this matter should be referred to a larger Bench. I
am not impressed with this contention at all. There is no
conflict. Satendra Prasad Jain (supra) lays down the law and
on true application of the principle of ratio decidendi, it is a
direct precedent for the proposition involved in the present
case. I can squarely answer the questions of law arising in the
present case with reference to the settled principles and,
therefore, have no hesitation in rejecting this request made on
behalf of the appellants.
Let me also examine the other reasons which will support
the view taken by this Court in Satendra Prasad Jain (supra)
and followed in subsequent cases referred above. Section
17(1) of the Act uses the expression ‘though no such award
has been made’. This clearly demonstrates that making of an
award is not a sine qua non for issuance of a notification
under Section 4(1) read with Section 17(1) of the Act or even
taking possession in terms thereof. After publication of a
notification under Section 4 read with Sections 17(1) and 17(4)
77
of the Act, the authority is obliged only to publish a notice
under Section 9(1) of the Act and comply with the provisions of
Section 17(3A) before it can take possession within the
stipulated period. Once possession of the land is taken, it
shall thereupon vest absolutely in the Government free from
all encumbrances. In other words, Section 17(4) itself is a
permissible exception to the provisions of Section 11 of the Act
and, therefore, the question of enforcing Section 11A against
proceedings under Section 17 would not arise. Under Section
16, the land shall vest in the Government free from all
encumbrances only after the award is made and possession is
taken. In contradistinction to this, under Section 17(1) the
land shall vest absolutely in the Government free from all
encumbrances even when no award is made and possession
thereof is taken in terms of Sections 17(1) and 17(3A) of the
Act. We have to give the language of Section 17(1) its plain
meaning, within the field of its operation. Another reason in
support of taking such a view is that, once such possession is
taken and the land is so vested, the Act does not make any
provision for re-vesting of land in the owners/persons
78
interested. Reversion of title or possession of property
acquired, which has vested in the Government or in the
authority for whose benefit such lands are acquired, is
unknown to the scheme of the Act. To introduce such a
concept by interpretative process would neither be permissible
nor proper.
Discussion on reverting back of land to the owners in
terms of Section 48 of the Act
A Constitution Bench of this Court (to which I was a
member) in the recent judgment in the case of Offshore
Holdings Pvt. Ltd. v. Bangalore Development Authority & Ors.
[(2011) 3 SCC 139], while dealing with the provisions of
Sections 27 and 36 of the Bangalore Development Authority
Act read with the provisions of the Land Acquisition Act and
while referring to non-reversion of property to owners where it
is vested in the Government, held as under :
“Where, upon completion of the
acquisition proceedings, the land has
vested in the State Government in terms
of Section 16 of the Land Acquisition Act,
the acquisition would not lapse or
79
terminate as a result of lapsing of the
scheme under Section 27 of the BDA Act.
An argument to the contrary cannot be
accepted for the reason that on vesting,
the land stands transferred and vested in
the State/Authority free from all
encumbrances and such status of the
property is incapable of being altered by
fiction of law either by the State Act or by
the Central Act. Both these Acts do not
contain any provision in terms of which
property, once and absolutely, vested in
the State can be reverted to the owner on
any condition. There is no reversal of the
title and possession of the State.
However, this may not be true in cases
where acquisition proceedings are still
pending and land has not been vested in
the Government in terms of Section 16 of
the Land Acquisition Act.”
As already discussed, no award is required to be made
before the provisions of Section 17(1) can be invoked. Such an
approach is further buttressed by another factor that is
reflected under Section 17(3B) of the Act. The amount of 80
per cent of the estimated compensation deposited under
Section 17(3A) of the Act is to be finally adjusted against the
award made under Section 11 in terms of Section 17(3B) of the
Act. A cumulative reading of these provisions clearly suggests
80
that provisions of Section 11A of the Act can hardly be applied
to the acquisition under Section 17 of the Act.
Another point which would support the view that I am
taking is with reference to the provisions of Section 48 of the
Act. Section 48 empowers the Government to withdraw from
the acquisition of the land of which possession has not been
taken. Where the Government withdraws from such an
acquisition, it is its duty to determine the amount of
compensation for the damages suffered by the owners as a
consequence of the notice or any other proceeding taken
thereunder, which amounts have to be paid as per provisions
of Part III. Section 48, thus, is a clear indication that the
power of the Government to withdraw the acquisition is
subject to the limitation stated under Section 48 itself. The
scheme of Section 48 can be summarized as follows:
A. Except in cases provided under Section 36, the Government
has the power to withdraw from the acquisition of any land;
B. Provided the possession of such land had not been taken;
81
C. Government is liable to pay compensation for the damages
suffered by the owner as a consequence of notice or any
proceeding thereunder which have to be computed in
accordance with the provisions of Part III.
There is no ambiguity in the language of Section 48 of the
Act to give it any other interpretation except that the
Government is not vested with the power of withdrawing from
the acquisition of any land, of which the possession has been
taken. Where the award has been made and possession has
been taken, the land vests in the Government in terms of
Section 16 of the Act. On the contrary, the land vests
absolutely in the Government free from all encumbrances
where award has not been made and only possession as
contemplated under Section 17(1) of the Act has been taken.
If the Government has no power to withdraw from acquisition
of any land, the possession of which has been taken, then by
no stretch of imagination can it be held that the Government
will have the power to withdraw from the acquisition of any
land where the land has vested in the Government or the land
82
has been subsequently transferred in favour of an authority
for whose development activity the lands were acquired. In
the case of Lt. Governor of Himachal Pradesh and Anr. v.
Avinash Sharma [(1970) 2 SCC 149 ], this Court took the view
that once the notification under Section 17(1) of the Act is
issued and land accordingly vested with the Government, the
notification can neither be cancelled under Section 21 of the
General Clauses Act nor can it be withdrawn in exercise of
powers conferred by the Government under Section 48 of the
Act. This Court in Avinash Sharma’s case (supra) held as
under :
“But these observations do not assist the
case of the appellants. It is clearly
implicit in the observations that after
possession has been taken pursuant to a
notification under Section 17(1) the land
is vested in the Government, and the
notification cannot be cancelled under
Section 21 of the General Clauses Act,
nor can the notification be withdrawn in
exercise of the powers under Section 48
of the Land Acquisition Act. Any other
view would enable the State Government
to circumvent the specific provision by
relying upon a general power. When
possession of the land is taken under
Section 17(1), the land vests in the
83
Government. There is no provision by
which land statutorily vested in the
Government reverts to the original owner
by mere cancellation of the notification.”
In another case titled Rajasthan Housing Board and
Others v. Shri Kishan and Others [(1993) 2 SCC 84], this Court
was concerned with a notification issued under Section 4 of
the Act and also a notification issued a few days after the
issuance of the first notification, under Section 17(4) of the
Act. These were challenged on the ground that there was no
urgency and so, the provisions of Section 5A of the Act could
not be dispensed with and that there were structures on the
land which could not have been acquired. An argument was
also raised that the Government had intended and, in fact,
issued letters de-notifying the lands acquired and, thus, they
should be treated as having been de-notified as per the
decision of the Government. In these circumstances, the
Court held as under:
“26. We are of the further opinion that in
any event the government could not have
withdrawn from the acquisition under
Section 48 of the Act inasmuch as the
Government had taken possession of the
84
land. Once the possession of the land is
taken it is not open to the government to
withdrawn from the acquisition. The very
letter dated 24.2.1990 relied upon by the
counsel for the petitioner recites that
"before restoring the possession to the
society the amount of development
charges will have to be returned back....”
This shows clearly that possession was
taken over by the Housing Board. Indeed
the very tenor of the letter is, asking the
Housing Board as to what development
work they had carried out on the land
and how much expenditure they had
incurred thereon, which could not have
been done unless the Board was in
possession of the land. The Housing
Board was asked to send the full
particulars of the expenditure and not to
carry on any further development works
on that land. Reading the letter as a
whole, it' cannot but be said that the
possession of the land was taken by the
government and was also delivered to the
Housing Board. Since the possession of
the land was taken, there could be no
question of withdrawing from the
acquisition under Section 48 of the Land
Acquisition Act, 1894.”
In the case of Sanjeevanagar Medical & Health
Employees’ Cooperative Housing Society v. Mohd. Abdul Wahab
and Others [(1996) 3 SCC 600], it was held that the acquired
land had already been transferred to the society for the benefit
85
of which the lands were acquired, by invoking the urgency
clauses. The question of reverting acquired land had not
arisen in this case directly, as the Court was primarily
concerned with the contention that the notification issued
under Section 4 was liable to be quashed. A question, with
regard to inconsistency between the Central and the State
Acts, was also raised. The Court, in paragraph 12 of the
judgment, held that by operation of Section 16, land had been
vested in the State free from all encumbrances and while
referring to the judgment of this Court in Satendra Prasad
Jain (supra) reiterated the principle that ‘Divesting the title to
the land statutorily vested in the Government and reverting
the same to the owner is not contemplated under the Act. Only
Section 48 gives power to withdraw from acquisition that too
before possession is taken.’
This principle was followed by another Bench of this
Court in the case of Bangalore Development Authority and
Others v. R. Hanumaiah and Others [(2005) 12 SCC 508]
wherein, it was held as follows:
86
“46. The possession of the land in
question was taken in the year 1966 after
the passing of the award by the Land
Acquisition Officer. Thereafter, the land
vested in the Government which was then
transferred to CITB, predecessor-ininterest
of the appellant. After the vesting
of the land and taking possession thereof,
the notification for acquiring the land
could not be withdrawn or cancelled in
exercise of powers under Section 48 of
the Land Acquisition Act. Power under
Section 21 of the General Clauses Act
cannot be exercised after vesting of the
land statutorily in the State
Government.”
Similarly, even in the case of National Thermal Power
Corporation Limited v. Mahesh Dutta and Others [(2009) 8 SCC
339], the Government had desired to withdraw lands from
acquisition after the lands had vested in it, in exercise of its
power under Section 48 of the Act. Rejecting the contention of
the State in paragraph 16 of the judgment, the Court stated
that ‘it is a well settled proposition of law that in the event the
possession of the land, in respect whereof a notification had
been issued, had been taken over, the State would be denuded
of its power to withdraw from the acquisition in terms of
Section 48 of the Act.’ The Court then went to the extent of
87
expressing the view that the possession taken may be
symbolic or actual.
I must notice that in the case of U.P. Jal Nigam, Lucknow
through its Chairman and Another v. Kalra Properties (P) Ltd.,
Lucknow & Others [(1996) 3 SCC 124], a Bench of this Court
had made a passing observation in paragraph 3 of the
judgment:
“It is further settled law that once
possession is taken by operation of
Section 17(2), the land vests in the State
free from all encumbrances unless a
notification under Section 48(1) is
published in the Gazette withdrawing
from the acquisition. Section 11A, as
amended by the Act of 68 of 1984,
therefore, does not apply and the
acquisition does not lapse”.
The aforesaid observations that the State may issue ‘a
notification under Section 48(1)’ and this notification may be
‘published in the Gazette withdrawing from the acquisition’,
are nothing but an obiter of the Court without any discussion
thereto. The question whether the acquisition proceedings
lapse or that the notification cancelling acquisition could be
88
issued after the possession is taken, where the land has vested
in the Government did not arise in that case. The Court was
primarily concerned with three main questions:
1. What was the effect of possession of land subsequent to
notification issued under Section 4(1) of the Act?
2. Whether the provisions of Section 11A of the Act would
apply to the acquisition under Section 17(1) read with
Section 17(4) of the Act? and
3. How the market value should be determined?
Firstly, if the said interpretation is given, it shall be
contrary to the specific language of Section 48 of the Act.
Secondly, the learned Judges did not refer to any judgment of
this Court while making the observation that ‘it is further
settled law’. I have referred to the consistent view of this
Court right from the year 1970 till 2011 and no judgment to
the contrary has been brought to the notice of the Court.
Thus, I must hold that the observations made in paragraph 3,
89
as reproduced, are merely an obiter and not a binding
precedent.
The lands which have been acquired under the provisions
of Section 17 of the Act are incapable of being reverted to the
owners/persons interested. The Act does not make any such
provision and, thus, the Court is denuded of any such power.
The Court must exercise its power within the framework of
law, i.e., the provisions of the Act.
In the case of an ordinary acquisition, if the land has
vested in the State Government then neither the Government
nor the court can take recourse to the provisions of Section
48(1) of the Act, there the question of applying Section 11A of
the Act to acquisition proceedings under Section 17 of the Act
cannot arise, as it would tantamount to achieving something
indirectly which would be impermissible to be achieved
directly. For all the above reasons, I hold that Section 11A of
the Act has no application to the acquisition proceedings
under the provisions of Section 17 of the Act.
90
There is no dispute in the present case that the
provisions of Section 11A of the Act have not been complied
with. Admittedly, the notification under Section 4(1) read with
Section 17(4) was published on 17th April, 2002, declaration
under Section 6 was made on 22nd August, 2002 and the
possession of the property was taken on 4th February, 2003.
The award has been made on 9th June, 2008, much after the
expiry of the prescribed period of two years under Section 11A
of the Act. There being an admitted violation of the provisions
of Section 11A of the Act, the natural consequence is that its
rigours would be attracted. However, the most pertinent
question that arises for consideration is: whether the
provisions of Section 11A of the Act are applicable to the
acquisition of land under Section 17 of the Act?
The main thrust of submissions on behalf of the
appellants is that the provisions of Section 11A of the Act
would be attracted even to the acquisition proceedings
undertaken by the appropriate Government in exercise of
powers vested in it under Section 17 of the Act. It is
91
contended that Section 17 in the scheme of the Act is at parity
to the normal and ordinary process of acquisition except that
it is a power to be exercised in urgent basis. The other
provisions like publication of notification under Section 4,
declaration under Section 6, notice under Sections 9 and 12
and passing of award under Section 11 of the Act are argued
to be essential features of an acquisition made under Section
17 of the Act as well. Thus, it is submitted that the provisions
of Section 11A of the Act would also apply to an acquisition
made under Section 17 of the Act. If an award is not made
within two years from the date of declaration under Section 6
of the Act, the acquisition proceedings should lapse
irrespective of whether the acquisition had commenced under
Section 4 by invoking powers of urgency or otherwise. It is
argued that there is no justification, whatsoever, for excluding
the application of Section 11A of the Act from acquisitions
made under Section 17 of the Act. On the contrary, the
contention on behalf of the respondents is that provisions of
Section 11A of the Act have no application to the provisions of
Section 17 of the Act. In fact, there is an apparent, though
92
limited, conflict between these provisions. The very purpose
and object of the Act would stand defeated if provisions of
Section 11A of the Act are applied to the acquisitions under
Section 17 of the Act.
I may now examine the scheme of the Act, with particular
reference to the difference between acquisitions in exercise of
emergent powers under Section 17 of the Act and the
acquisitions made otherwise. In both the cases, notification
under Section 4(1) has to be published in accordance with the
provisions of the Act. Notification under Section 4 is a sine
qua non for commencement of the acquisition proceedings and
this has been the consistent view of this Court right from the
case of Narender Jeet Singh v. State of U.P. [(1970) 1 SCC 125]
wherein the Court clearly held that issuance of a notification
under sub-section (1) of Section 4 is a condition precedent to
exercise of any further powers under the Act and the
notification issued under that provision should comply with
the essential requirements of law under that provision.
Thereafter, the owners/persons interested have to be given an
93
opportunity to file objections as contemplated under Section
5A of the Act and after granting them hearing, a declaration
under Section 6 of the Act has to be published. Subsequent to
the publication of such a declaration, notice under Section
9(1) of the Act has to be issued stating the intention of the
Government to take possession of the land and that claims for
compensation and for all interests in such land may be made
to the competent authority. Following the procedure
prescribed, an award has to be made under Section 11 of the
Act awarding compensation for acquisition of the land with its
complete details. Under the scheme of the Act, in the event of
an ordinary acquisition in contradistinction to acquisition in
exercise of emergent powers, if the award is not made within a
period of two years from publication of the declaration under
Section 6, the acquisition proceedings would lapse. In these
proceedings, the possession of the land remains with the
claimant/owners of the land and it is only when the award
becomes final in terms of Section 12 of the Act, possession of
the land is taken and the acquired land vests in the
94
Government free from all encumbrances under Section 16 of
the Act.
Where the lands are acquired in exercise of emergent
powers of the State under Section 17 of the Act, a notification
under Section 4(1) of the Act is issued and the notification
itself refers to the provisions of Section 17(1) as well as Section
17(4) of the Act. A specific power is vested in the appropriate
Government to declare that provisions of Section 5A would not
be applicable to such acquisition. Therefore, there is no
obligation upon the Collector/authority concerned to invite
and decide upon objections in terms of Section 5A of the Act,
prior to publication of a declaration under Section 6 of the Act.
However, notice under Section 9(1) of the Act has to be
published to completely and fully invoke the powers vested in
the State for taking possession of the land, in terms of Section
17(1) of the Act. After the expiry of 15 days from such
publication under Section 9(1), the possession of the land can
be validly taken by the Government, whereupon the land
would vest absolutely in the Government, free from all
95
encumbrances. In other words, for proper computation of the
specified period of 15 days, issuance of notification under
Section 9(1) of the Act would be necessary, but it cannot be
held to be mandatory in its operation so as to render the
execution proceedings invalid. In the case of May George
(supra), a Bench of this Court has expressed the view that the
notification under Section 9(1) of the Act as contemplated
under Section 17(1) of the Act is not mandatory.
Before the Government takes possession of the land in
exercise of its powers under Section 17(1) of the Act, it has to
comply with the requirements of Section 17(3A) of the Act.
The amount so paid, if falls short, and/or is in excess of
compensation actually due to the land owners, the same shall
be determined and adjusted while making the final award
under Section 11 of the Act. It is evident that both these
acquisitions have distinct schemes of acquisition. Section 17
of the Act itself refers to some other provisions, like Sections
5A, 9, 11, and 31 of the Act. Wherever such reference was
considered necessary by the Legislature, it has been so made.
96
Thus, there is no occasion for the Court to read into Section
17, the language of Section 11A of the Act which has not been
provided by the Legislature; more so when doing so would
destroy or frustrate the very object of the urgent acquisition.
Marked distinction between the implementation of these two
types of acquisition schemes contained in the Act is clearly
suggestive that these schemes operate in their respective fields
without any contradiction. Hence, the Court would adopt an
interpretation which would further such a cause, rather than
the one which will go contra to the very scheme of the Act.
In my considered view, it will be difficult for me to hold
that the provisions of Section 11A of the Act, despite being
mandatory, would apply to the scheme of acquisition
contained under Section 17 of the Act.
Whether the Claimants can be granted any relief even on
equitable grounds?
The facts, as already noticed by me above, are hardly in
dispute. Admittedly, the possession of the land had been
taken on 4th February, 2002 and the Writ Petition No. 2225
97
was filed by the petitioners in the year 2006 i.e. after the
possession has been taken. In terms of Section 17(1) of the
Act, the land has been vested absolutely and free from all
encumbrances in the Government. After vesting of the land,
the development activity had been carried out over the years
and it is informed that Sector 88, NOIDA is fully developed
and operational.
Once the development activity has been completed in the
entire sector, will it be equitable to release the lands from
acquisition? Even if for the sake of argument, it is assumed
that there is some merit in the contention raised on behalf of
the appellant, the answer has to be in the negative. It is
settled canon of equitable jurisdiction that the person who
feels aggrieved by an action of the State should approach the
Court without any unnecessary delay, particularly in cases
such as the present one. While the notification under Section
4 read with Sections 17(1) and 17(4) of the Act was issued on
14th April, 2002 and possession taken on 4th February, 2003
the writ petitions in question were filed in August 2006, i.e.,
98
more than four years subsequent to the issuance of the
notification under Section 4. It was contended that the cause
of action to challenge the acquisition proceedings arose only
after the period of two years had lapsed from the date of
issuance of the notification. Even if that be so, still there is an
unexplained and undue delay of more than two years in
approaching the Court. This would itself disentitle the
appellants to claim any equitable relief in the facts and
circumstances of the present case.
I must not be understood to say that in every case of
delay, per se, the Court would decline to exercise its
jurisdiction if the party to the lis can otherwise be granted
relief in accordance with law. This has to be decided keeping
in view the facts and circumstances of a given case.
It is not in dispute and, in fact, can hardly be disputed
that in the intervening period of nearly ten years, the acquired
areas have fully developed. Not only this, it is informed during
the course of hearing that the award was finally made by the
authorities on 9th June, 2008 and has been accepted by nearly
99
97.6 per cent of the owners whose lands were acquired vide
the said notification. In other words, nearly all land owners
have accepted the award and permitted the development
activity to be carried out. This conduct of the owners as a
whole would again be a factor which will weigh against the
grant of any relief to the appellants. Huge amounts of money
and resources of the State, as well as other bodies or persons
have been invested on the development of this sector which is
stated to be an industrial sector. It will be unjust and unfair
to uproot such a developed sector on the plea raised by the
present appellants. In this view, I am fully supported by the
judgment of a Division Bench of this Court, to which my
learned brother (Ganguly, J.) was a member, in the case of
Tamil Nadu Housing Board v. L. Chandrasekaran (Dead) by
Lrs. & Ors. [(2010) 2 SCC 786]. The Bench was primarily
dealing with the question of re-conveyance of the acquired
lands on the grounds of discrimination and arbitrariness. The
High Court had passed a direction against the Board to reconvey
the acquired land, which was held by this Court, on
appeal, to be contrary to the provisions of Section 48 of the
100
Act. This Court settled the point of law holding that it is not
appropriate for the Court to quash the acquisition proceedings
at the instance of one or two land owners, where the
development had taken place and majority of the land owners
had not challenged the acquisition. The Court, while relying
upon the case of A.S. Naidu v. State of Tamil Nadu [(2010) 2
SCC 801] held as under:
“15. The first issue which requires
consideration is whether the order passed
by this Court in A.S. Naidu case has the
effect of nullifying the acquisition in its
entirety. In this context, it is apposite to
mention that neither the appellant Board
nor have the respondents placed before
the Court copies of the writ petitions in
which the acquisition proceedings were
challenged, order(s) passed by the High
Court and the special leave petitions
which were disposed of by this Court on
21-8-19903 and without going through
those documents, it is not possible to
record a finding that while disposing of
the special leave petitions preferred by
A.S. Naidu and others, this Court had
quashed the entire acquisition
proceedings. So far as A.S. Naidu is
concerned, he did not even make a prayer
before the High Court for quashing the
preliminary notification issued under
Section 4(1) of the Act.
16. This is evident from the prayer made
by him in Writ Petition No. 7499 of 1983,
which reads as under:
101
“For the reasons stated in the
accompanying affidavit, it is most
respectfully prayed that this Hon’ble
Court may be pleased to issue a writ
of certiorari or any other proceeding
or any other appropriate writ or
direction or order in the nature of a
writ to call for the records of the first
respondent relating to GOMs No.
1502, Housing and Urban
Development Department dated 7-
11-1978 published in the Tamil
Nadu Government Gazette
Extraordinary dated 10-11-1978 in
Part II Section 2 on pp. 22 to 26 and
quash the said notification issued
under Section 6 of the Land
Acquisition Act, 1894 insofar as it
relates to the land in the petitioners’
layout approved by the Director of
Town Planning in LPDM/DTP/2/75
dated 7-3-1975 in Survey Nos. 254,
257, 258, 260, 268 and 271 in
Mogapperi Village, No. 81, Block V,
Saidapet Taluk, Chingleput District
and render justice.”
From the above reproduced prayer
clause, it is crystal clear that the only
relief sought by Shri A.S. Naidu was for
quashing the notification issued under
Section 6 insofar it related to the land
falling in Survey Nos. 254, 257, 258, 260,
268 and 271 in Mogapperi Village, No.
81, Block V, Saidapet Taluk and in the
absence of a specific prayer having been
made in that regard, neither the High
Court nor this Court could have quashed
the entire acquisition. This appears to be
the reason why the Division Bench of the
High Court, while disposing of Writ
Appeals Nos. 676 of 1997 and 8-9 of
1998 observed that quashing of
acquisition by this Court was only in
relation to the land of the petitioner of
that case and, at this belated stage, we
102
are not inclined to declare that order
dated 21-8-19903 passed by this Court
had the effect of nullifying the entire
acquisition and that too by ignoring that
the appellant Board has already utilised
portion of the acquired land for housing
and other purposes. Any such inferential
conclusion will have disastrous
consequences inasmuch as it will result
in uprooting those who may have settled
in the flats or houses constructed by the
appellant Board or who may have built
their houses on the allotted plots or
undertaken other activities.
XXX XXX XXX
26. A glance at the impugned order
shows that the Division Bench did not at
all advert to the factual matrix of the case
and the reasons incorporated in the
Government’s decision not to reconvey
the acquired land to the respondents. The
Division Bench also did not examine the
correctness or otherwise of the order
passed by the learned Single Judge and
allowed the appeals preferred by the
respondents simply by relying upon order
dated 18-2-2000 passed in Writ Appeal
No. 2430 of 1999 and that too without
even making an endeavour to find out
whether the two cases were similar. In
our view, the direction given by the
Division Bench to the appellant Board to
reconvey the acquired land to the
respondents is per se against the plain
language of Section 48-B of the Act in
terms of which only the Government can
transfer the acquired land if it is satisfied
that the same is not required for the
purpose for which it was acquired or for
any other public purpose. The appellant
Board is not an authority competent to
transfer the acquired land to the original
owner. Therefore, the Division Bench of
the High Court could not have issued a
mandamus to the appellant Board to
103
reconvey the acquired land to the
respondents. As a matter of fact, the High
Court could not have issued such
direction even to the Government
because the acquired land had already
been transferred to the appellant Board
and the latter had utilised substantial
portion thereof for execution of the
housing scheme and other public
purposes.
27. There is one more reason why the
impugned judgment deserves to be set
aside. Undisputedly, the land of the
respondents forms part of large chunk
which was acquired for execution of the
housing scheme. The report sent by the
appellant Board to the State Government
shows that the purpose for which the
land was acquired is still subsisting. The
respondents had neither pleaded before
the High Court nor was any material
produced by them to show that the report
which formed basis of the Government’s
decision not to entertain their prayer for
reconveyance of the land was vitiated by
mala fides or that any extraneous or
irrelevant factor had influenced the
decision-making process or that there
was violation of the rules of natural
justice. Therefore, the Division Bench of
the High Court could not have exercised
the power of judicial review and indirectly
annulled the decision contained in
communication dated 18-3-1999.
28. It need no emphasis that in exercise
of power under Section 48-B of the Act,
the Government can release the acquired
land only till the same continues to vest
in it and that too if it is satisfied that the
acquired land is not needed for the
purpose for which it was acquired or for
any other public purpose. To put it
differently, if the acquired land has
already been transferred to other agency,
the Government cannot exercise power
under Section 48-B of the Act and
104
reconvey the same to the original owner.
In any case, the Government cannot be
compelled to reconvey the land to the
original owner if the same can be utilised
for any public purpose other than the one
for which it was acquired.”
I am of the considered view that what has been stated by
the learned Judges in that case is squarely applicable, even on
facts, to the present case. Firstly, there is no merit in the
contentions of law raised by the appellants, which I have
already rejected. Secondly, even on equity, the appellants have
no case.
Before I part with this file, I cannot ignore one very
important aspect which has come to my notice during the
hearing of the case and which, as stated at the Bar, is an often
repeated default on the part of the Government Departments
causing undue inconvenience, harassment, hardship and
ultimately resulting in the acquisition itself being inequitable
against the land owners/persons interested therein. The
declaration under Section 6 was made on 22nd August, 2002,
the notice under Section 9(1) had been issued and possession
of the land was taken on 4th February, 2003. In the normal
105
course and as per the requirements of the provisions of
Section 17(3A) read with Section 17(1), 80 per cent of the
estimated compensation ought to have been paid to the
owners of the land/persons interested, within that period prior
to taking possession and/or, in any case, within a very limited
and reasonable time. This I am only noticing subject to my
finding that there is unequivocal statutory obligation upon the
respondents to pay the amount prior to taking possession of
the land in question. However, the award made on 9th June,
2008 would have otherwise vitiated the entire acquisition
proceedings, but for the fact that, as held by me above and for
reasons recorded supra that Section 11A does not apply to the
acquisition made in exercise of emergent powers in terms of
Section 17 of the Act. Still, to do things within a reasonable
time is an obligation of the State, as is imposed by the
Legislature itself and even otherwise as per the canons of
proper governance, i.e., vigilantibus, non dormientibus, jura
subveniunt, which means the laws assist those who are
vigilant, not those who sleep over their rights. According to
Respondent No.2, they had deposited 10 per cent of the
106
estimated compensation prior to issuance of notification under
Section 4, i.e., 17th April, 2002 and 70 per cent of the amount
was deposited with the Government on 8/14th July, 2002 by a
cheque. The amount deposited was nearly ` 6,66,00,000/-
and odd. For reasons best known to the State Government,
this amount was not disbursed to the claimants until passing
of the award. In other words, the amount was made available
to the Government and its authorities for disbursement to the
owner/claimants prior to (or soon after) taking of the
possession, which was taken on 4th February, 2003, but still
the claimants were deprived of their legitimate dues without
any justification or reason. In order to show this, learned
counsel appearing for respondent No.2 had even shown the
records to the Court. It was also the duty of respondent No.2
to ensure that the payments were made to the claimants prior
to taking of possession but, in any case, it was an unequivocal
statutory obligation on the part of the State/Collector to
ensure that the payments were made to the claimants in terms
of Section 17(1) read with Section 17(3A) prior to taking of
possession. No justification whatsoever had been advanced
107
and can be advanced for such an intentional default and the
casual attitude of the concerned officers/officials in the State
hierarchy.
These authorities are instrumentalities of the State and
the officers are empowered to exercise the power on behalf of
the State. Such exercise of power attains greater significance
when it arises from the statutory provisions. The level of
expectation of timely and just performance of duty is higher,
as compared to the cases where the power is executively
exercised in discharge of its regular business. Thus, all
administrative norms and principles of fair performance are
applicable to them with equal force, as they are to the
Government department, if not with a greater rigour. The well
established precepts of public trust and public accountability
are fully applicable to the functions which emerge from the
public servants or even the persons holding public office. In
the case of State of Bihar v. Subhash Singh [(1997) 4 SCC 430],
this Court, in exercise of the powers of judicial review, stated
that the doctrine of ‘full faith and credit’ applies to the acts
108
done by the officers in the hierarchy of the State. They have to
faithfully discharge their duties to elongate public purpose.
The concept of public accountability and performance of
functions takes in its ambit, proper and timely action in
accordance with law. Public duty and public obligation both
are essentials of good administration whether by the State or
its instrumentalities. In the case of Centre for Public Interest
Litigation & Anr. v. Union of India & Anr. [(2005) 8 SCC 202],
this Court declared the dictum that State actions causing loss
are actionable under public law. This is a result of innovation,
a new tool with the courts which are the protectors of civil
liberties of the citizens and would ensure protection against
devastating results of State action. The principles of public
accountability and transparency in State action are applicable
to cases of executive or statutory exercise of power, besides
requiring that such actions also not lack bona fides. All these
principles enunciated by the Court over a passage of time
clearly mandate that public officers are answerable for both
their inaction and irresponsible actions. If what ought to have
109
been done is not done, responsibility should be fixed on the
erring officers; then alone, the real public purpose of an
answerable administration would be satisfied.
The doctrine of ‘full faith and credit’ applies to the acts
done by the officers. There is a presumptive evidence of
regularity in official acts, done or performed, and there should
be faithful discharge of duties to elongate public purpose in
accordance with the procedure prescribed. Avoidance and
delay in decision making process in Government hierarchy is a
matter of growing concern. Sometimes delayed decisions can
cause prejudice to the rights of the parties besides there being
violation of the statutory rule. This Court had occasion to
express its concern in different cases from time to time in
relation to such matters. In the case of State of Andhra
Pradesh v. Food Corporation of India [(2004) 13 SCC 53], this
Court observed that it is a known fact that in transactions of
Government business, no one would own personal
responsibility and decisions would be leisurely taken at
various levels.
110
Principles of public accountability are applicable to such
officers/officials with all their rigour. Greater the power to
decide, higher is the responsibility to be just and fair. The
dimensions of administrative law permit judicial intervention
in decisions, though of administrative nature, which are ex
facie discriminatory. The adverse impact of lack of probity in
discharge of public duties can result in varied defects, not only
in the decision making process but in the final decision as
well. Every officer in the hierarchy of the State, by virtue of
his being ‘public officer’ or ‘public servant’, is accountable for
his decisions to the public as well as to the State. This
concept of dual responsibility should be applied with its
rigours in the larger public interest and for proper governance.
I find no justification, whatsoever, for the Government,
despite deposit by the beneficiary, not to pay 80 per cent of the
estimated compensation due to the claimants within the
requisite time and not even within the reasonable time. It was
breach of statutory and governance obligation of the State’s
officers/officials to pay the amount to the claimants after more
111
than five years. It is expected of the State officers not to forget
that these are compulsory acquisitions in exercise of State’s
power of eminent domain and the legislative intent behind
providing safeguards and some benefits against such
acquisition ought not to be frustrated by inaction and
omissions on the part of the officers/officials. There being
patent unexplained mistakes, omissions and errors,
committed by the officers/officials in the State of Uttar
Pradesh in dealing with this entire matter, I hereby impose
cost of ` 1,00,000/- on the State Government which at the first
instance shall be paid by the State to the owners of the land,
i.e., present appellants or persons situated alike. However this
amount shall be recovered from the salary of all the
officers/officials found guilty by the State which shall conduct
an inquiry for that purpose in accordance with law. The
inquiry shall be completed within a period of six months from
today and a report shall be submitted to the Secretary General
of this Court on the administrative side. Imperatively, it must
follow that the Central Government and all State Governments
must issue appropriate directions to ensure that there is no
112
harassment, hardship or inequality caused to the
owners/persons interested in the lands acquired by the State,
in exercise of its powers of eminent domain under Section
17(1) of the Act. Wherever the payments are not made within
time and appropriate steps are not taken to finalize the
acquisition of the land, the concerned Government should
take appropriate disciplinary action against the erring
officers/officials involved in and responsible for the process of
acquisition.
I will prefer to record my conclusions and also answer the
four legal questions (‘A’ to ‘D’) as framed in the judgment by
my learned brother. They are as follows:
(A)I hold and declare that Section 11A of the Act has no
application to the acquisition proceedings conducted under
the provisions of Section 17 of the Act;
Once the acquired land has vested in the Government in
terms of Section 16 or 17(1) of the Act, possession of
which has already been taken, such land is incapable of
being re-vested or reverted to the owners/persons
113
interested therein, for lack of any statutory provision for
the same under the Act.
(B) The provisions of Section 17(3A) of the Act, on their
bare reading, suggest that the said provision is mandatory
but, as no consequences of default have been prescribed by
the Legislature in that provision, thus, it will hardly be
permissible for the Court to read into the said provision any
drastic consequences much less lapsing of entire
acquisition proceedings. In other words, default in
complying with provisions of Section 17(3A) cannot result in
invalidating or vitiating the entire acquisition proceedings,
particularly when the possession of the acquired land has
been taken and it has vested in the Government free from
all encumbrances.
(C) Keeping in view the scheme of the Act, the provisions
of Section 17 of the Act can be construed strictly but such
interpretation must be coupled with the doctrine of literal
and contextual interpretation, while ensuring that the
object of the legislation is not defeated by such an
114
interpretation. Strict compliance to the conditions
contemplated under Section 17 of the Act should be given
effect to but within the framework of the statute, without
making any additions to the language of the section.
(D)Once the right to property ceases to be a Fundamental
Right after omission of Articles 19(1)(f) of the Constitution of
India, the addition of Articles 31A and 300A by the 44th
Constitutional Amendment, 1978, cannot place the legal
right to property at the same pedestal to that of a
fundamental right falling under Chapter III of the
Constitution. It has been clearly held by the Courts that
the provisions of the Land Acquisition Act are not violative
of Article 14 of the Constitution. The rights of the citizens
and interest of the State can be balanced under the
provisions of the Act, without any violation of the
Constitutional mandate.
Besides answering the questions of law and stating my
conclusions as above, it is both appropriate and necessary to
pass certain directive orders to ensure the maintenance of
115
balance between the might of the State on the one hand and
the rights of land owners on the other. It is, therefore,
necessary to issue the following directions :
(i) The Government/acquiring authority shall be liable to
pay interest at the rate of 15 per cent per annum with
reference to or alike the provisions of Section 34 of the
Act, after the expiry of 15 days from issuance of
notification under Section 9(1) of the Act, and from the
date on which the possession of the land is taken, till the
amount of 80 per cent of the estimated compensation is
paid to the claimants.
In the facts of the present case, it is clear that 80 per
cent of the estimated compensation had been deposited
by the beneficiary. However, it is no way clear on record
that these amounts had actually been received by the
owners/interested persons. Where the amounts have
been paid beyond the period as stated in Section 17(3A),
the claimants still would be entitled to the rate of interest
afore-indicated. Interest should be computed from the
116
date of the notification till the date of payment to the
claimants. The Government is also liable to pay interest
as afore-indicated on the balance amount determined
upon making of an award in accordance with Section 11
of the Act.
(ii) The Central Government and all the State Governments
shall issue appropriate and uniform guidelines, within 8
weeks from today, to ensure that the land owners and
the persons interested in the lands cquired by the State
or its instrumentalities are not put to any undue
harassment, hardship and inequity because of inaction
and omission on the part of the acquiring authority, in
cases of urgent acquisition under Section 17 of the Act.
The Government should ensure timely action for
acquisition and payment of compensation in terms of the
provisions of the Act, particularly Section 17(3A) of the
Act, as explained in this judgment.
(iii) Wherever the Government exercises its power under
Section 17(1) of the Act and there is default in deposit of
117
the amount in terms of Section 17(3A) of the Act, as
explained in this judgment, the concerned Government
shall take appropriate disciplinary action against the
erring officers/officials including making good the loss
caused to the Government revenue on account of the
liabilities towards interest or otherwise, because of such
undue delay on the part of such officers/officials;
(iv) In this case, the claimants would be entitled to the cost
of ` 1,00,000/- (Rupees one lakh only) which shall be
deposited at the first instance by the State Government of
Uttar Pradesh and then would be recovered from the
salaries of the defaulting/erring officers/officials in
accordance with law. The inquiry shall be completed
within a period of six months from today and a report
shall be submitted to the Secretary General of this Court
on the administrative side immediately thereafter.
In result, the appeal is accordingly dismissed with the
above directions.
118
..
…........................................J.
[Swatanter Kumar]
New Delhi;
August 18, 2011
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.24 OF 2009
M/s. Delhi Airtech Services
Pvt. Ltd. & Anr. … Appellants
Versus
State of U.P. & Anr. … Respondents
J U D G M E N T
Ganguly, J.
1. The facts giving rise to the present appeal are simple
and fall within a narrow compass. However, they raise
questions which are of public importance and legal
significance. Thus, it will be appropriate for us to state the
questions of law at the very threshold:
A. When the Government, in exercise of its emergency
powers under Section 17 of the Land Acquisition Act,
1894 (for short the ‘Act’) acquires lands, which have
since vested in the State, can such an acquisition
proceeding lapse and consequently the land can be
119
transferred to the owners/persons interested in the
event of default by the State, in complying with the
provisions of Section 11A of the Act?
B. Whether the provisions of Section 17(3A) of the Act are
mandatory or directory? In either event, would noncompliance
with this Section have the effect of
invalidating or vitiating the entire acquisition
proceedings, even where the land has vested in the
State in terms of Section 17(1) of the Act?
C. Whether with the invoking of the emergency provisions
which have the effect of dispensing with the provision
of hearing under Section 5A of the Act, the Court is
entitled to construe the emergency provisions strictly,
being drastic provisions in an exproprietory law and
consider the safeguards inbuilt in Section 17(3A)
against such drastic provisions as conditions
precedent and mandatory for a valid exercise of
emergency provisions.
D. Whether having regard to the principle of
reasonableness being a basic component of
120
fundamental rights under the Constitution, this Court
has to construe the provisions of the said Act, a preconstitutional
law in consonance with reason and
justice-the fundamental tenets of Article 14 and thus
arrive at a balanced interpretation of the interest of the
State as against the rights of citizens or land owners.
FACTS:
2. The appellant No.1 is a company duly incorporated
under the provisions of the Indian Companies Act,
1956 and is alleged to be the owner of the land sought
to be acquired by the respondents. The appellant’s
land, admeasuring about 2-06-1/3-0 Bighas situated
in Village Haldauni, Tehsil and Pargana Dadri, District
Gautam Budh Nagar which is abadi land, was sought
to be acquired by the appropriate Government under a
notification dated 17th April, 2002 issued under
Section 4(1) read with Sections 17(1) and 17(4) of the
Act. This land was acquired for the planned industrial
development in District Gautam Budh Nagar through
the New Okhla Industrial Development Authority
121
(NOIDA). The notification also stated that the
provisions of Section 5A of the Act shall not apply. In
pursuance to the said notification, a declaration under
Section 6 of the Act was published on 22nd August,
2002, declaring the area which was required by the
Government. It also stated that after expiry of 15 days
from the date of the publication of the notification
under sub-section (1) of Section 9 of the Act,
possession of the acquired land shall be taken. The
appellants have alleged that they did not receive any
notice under Section 9(1) of the Act but possession of
the land was nevertheless taken on 4th February, 2003.
According to the appellants, even after a lapse of more
than three and a half years after the declaration under
Section 6 of the Act, no award had been made and
published.
3. The appellants further alleged that, despite inordinate
delay, they were neither paid 80 per cent of the
estimated compensation in terms of Section 17(3A) of
the Act at the time of taking of possession, nor had the
Collector passed an award within two years of making
122
the declaration under Section 17(1), as required by
Section 11A of the Act. It was the case of the
appellants that this has the effect of vitiating the entire
acquisition proceedings. Non-payment of
compensation and conduct of the Government
compelled the appellants to file a writ petition in the
High Court of Allahabad praying for issuance of an
order or direction in the nature of certiorari or any
other writ, and not to create any encumbrance or
interest on the land of the appellants. Further, they
prayed that the acquisition proceedings, insofar as
they relate to the land of the appellants, be declared
void ab initio and that the respondents be directed to
return the land under the possession of the
Government to the owners. Lastly, the appellants pray
that the respondents/Government be directed to pay
damages for use and occupation of the land.
4. To this writ petition, on behalf of NOIDA a counter
affidavit was filed in the High Court, denying that the
acquired land was in fact part of abadi land. NOIDA
also stated that 80 per cent compensation in terms of
123
Section 17(3A) had been deposited with the state
authorities. The land had been acquired for planned
development of NOIDA and it was in the physical
possession of the said authority. Possession of the
land had been taken on 4th February, 2003 and no
right had survived in favour of the appellant as the
land had vested in the Government.
5. The High Court, vide its judgment dated 28th August,
2006, dismissed the writ petition. The High Court
relied upon the judgment of this Court in the case of
Satendra Prasad Jain & Ors. v. State of U.P. &
Ors., [AIR 1993 SC 2517 = (1993) 4 SCC 369], and
dismissed the petition as the High Court held that
provisions of Section 11A of the Act are not attracted
to proceedings for acquisition by the Government
under Section 17 of the Act. However, liberty was
granted to the appellants to pray for grant of
appropriate compensation in accordance with law
before the competent forum.
124
6. Aggrieved by the said order of the High Court, the
appellants have filed the present appeal impugning the
judgment dated 28th August, 2006.
7. In the counter affidavit filed before this Court by
NOIDA, the stand in the counter filed before the High
Court has been reiterated, with an additional fact that
the sector in question was designated as industrial
area, and, after development activity was completed,
allotment has been made and possession of these
industrial plots has also handed over to such
entrepreneurs/allottees. This falls under Sector 88 of
the NOIDA City. The rest of the allegations made in the
writ petition, except the dates in question, have been
disputed.
8. It has also been stated at the Bar by the State
Counsel, on the basis of the record, without filing an
affidavit, despite directions given to that effect by this
Court on 5.1.2009, that 10 per cent of the estimated
compensation was deposited by NOIDA with the State
Government even prior to the date of the notification
125
under Section 4(1) read with Section 17(4) of the Act,
issued by the Government on 17.4.2002. The
remaining 70 per cent of the estimated compensation
had been allegedly deposited vide cheque dated 8/14th
July, 2002 amounting to approximately
Rs.6,66,00,000/-. As such, it is claimed there is
compliance with the provisions of Section 17(3A) of the
Act. The Award was made on 9.6.2008, which has
been accepted by a large number of owners, i.e., 97.6
per cent of all owners. Some of these facts have also
been averred in the counter affidavit of NOIDA filed
before the High Court.
9. It may be noted that neither before the High Court nor
before this Court any affidavit was filed either by the
State or by the Collector. The assertion of the appellant
about non-payment of compensation as contemplated
under Section 17(3A) of the Act has not been
controverted. Such payment has to be tendered by the
Collector to the person interested and entitled to the
same, subject to certain statutory conditions.
Assuming there has been deposit of 80% of the
126
compensation amount by NOIDA with the state
authorities, that does not satisfy the requirement of
Section 17(3A) of the Act. From the above pleadings of
the parties, the admitted facts that emerge from the
record can be usefully recapitulated.
10. The Governor of State of Uttar Pradesh on 17th April,
2002, issued a notification under Section 4(1) of the
Act, expressing the intention of the Government to
acquire the land stated in the said Notification for a
public purpose, namely, for the planned industrial
development in District of Gautam Budha Nagar
through NOIDA. Vide the same notification the
emergency provisions contained in Section 17 of the
Act, specifically Section 17(4) of the Act, were also
invoked, intimating the public at large that the
provisions of Section 5A of the Act shall not be
applicable. After issuance of the declaration under
Section 6 of the Act, admittedly the possession of the
land in question was taken on 4th February, 2003.
Another undisputed fact is that the claimants-owners
of the land were not paid 80 per cent of the estimated
127
compensation prior to taking of possession in terms of
Section 17(3A) of the Act.
11. The Collector had not made or published this award
even at the time of pronouncement of the judgment of
the High Court, in Writ Petition No. 22251 of 2006, on
28 August 2006. The High Court, in the impugned
judgment, directed respondent No.1 to ensure that the
Award is made as early as possible, preferably within a
period of three months from the date of production of
the certified copy of that order. In the counter affidavit
filed before this Court by NOIDA, it has been stated
that the Award was finally made and published on 9th
June, 2008. According to the appellant, in terms of
Section 11A of the Act, the Award ought to have been
pronounced on or before 26th August, 2004 as the
declaration under Section 6 of the Act was dated 22nd
August, 2002.
Legal Issues
12. If I may consider certain features of the said Act and
the constitutional provisions.
128
13. Enactment of the said Act was rooted in the colonial
past of this country having been brought on the
statute book on 1894 as Act 1 of 1984. With
enormous expansion of State’s role in promoting
welfare and development activities since independence,
acquisition of land for public purposes increased with
the passage of time. Several decades after the
enactment of the Act, came Constitution in India in
1950. Along with it came the concept of social and
economic justice based on expansive values of human
rights. Under article 366 (10) of the Constitution the
Act was an ‘existing law’ made before the
commencement of the Constitution.
Article 366(10) is quoted below:-
“366 (10) “existing law” means any law,
Ordinance, order, bye-law, rule or regulation
passed or made before the commencement of
this Constitution by any Legislature, authority
or person having power to make such a law,
Ordinance, order, bye-law, rule or regulation;”
129
14. Article 372 of the Constitution provides for
continuance in force of such ‘existing law’ and their
adaptation. Article 372 (1) of the Constitution makes it
clear that notwithstanding the provision of the Article
395, but subject to the other provisions of the
Constitution, all laws in force in the territory of India
immediately before the commencement of the
Constitution shall continue in force until altered or
repealed or amended by a competent Legislature or
other competent authority.
15. Article 13 of the Constitution, which is a part of
Fundamental Right (Part III), also defines ‘laws in force’
under Article 13(3)(b). Article 13(3)(b) is set out:-
“13 (3) (b) “laws in force” includes laws passed
or made by a Legislature or other competent
authority in the territory of India before the
commencement of this Constitution and not
previously repealed, notwithstanding that any
such law or any part thereof may not be then
in operation either at all or in particular
areas.”
130
16. The said definition of ‘laws in force’ under Article 13(3)
(b) with certain changes, is consistent with the
definition of ‘existing laws’ in Article 366(10).
17. The said Act is thus both an ‘existing law’ within the
meaning of Article 366(10) and ‘laws in force’ within
the meaning of Article 13(3)(b) of the Constitution.
18. Article 13(1), which is relevant in this context, is set
out below:
“Article 13. Laws inconsistent with or in
derogation of the fundamental rights: (1) All
laws in force in the territory of India
immediately before the commencement of this
Constitution, in so far as they are inconsistent
with the provisions of this Part, shall, to the
extent of such inconsistency, be void.”
19. Under Article 372 such laws in force can continue with
some amendments, subject to ‘the other provisions of
this Constitution’. Article 13 certainly comes within
‘the other provisions of the Constitution’.
20. Therefore, Article 372 and Article 13 must be read
together in as much as both the articles relate to
continuance of pre-constitutional laws validly made.
131
Article 372 permits such continuance and Article 13
stipulates the condition on which they can continue.
Article 13 is of greater importance as it is part of
fundamental right and makes all laws, whether pre or
post-constitution, subject to the primacy of
fundamental rights. The continuance of the said Act is
thus made to depend on its compliance with the
mandate of Article 13. The mandate of Article 13(1) is
clear that such law can continue provided it is not
inconsistent with the provision of Part III. In the event
of such laws becoming inconsistent with the provision
of Part III, such laws, to the extent of their
inconsistency, shall be void. This is the mandate of the
Constitution.
21. Therefore, several amendments were made to the said
Act keeping in view the broad concept of social and
economic justice which is one of the main
constitutional goals. In the instant case I am
concerned with some amendments to the said Act by
amendment Act 68 of 1984 which took effect from 24th
September 1984. Among several new sections, Section
132
11(A) and 17(3A) were introduced by amendment to
the said Act.
22. From the Statement of Objects and Reasons for the
said amendment it will be clear that the said
amendment was brought into existence to give effect to
the message of social and economic justice based on
the concept of Social Welfare State on broad principles
of human rights. The Statements of Objects and
Reasons are as follows:
“With the enormous expansion of the State’s role
in promoting public welfare and economic
development since independence, acquisition of
land for public purposes, industrialization,
building of institutions, etc., has become far more
numerous than ever before. While this is
inevitable, promotion of public purpose has to be
balanced with the rights of the individual whose
land is acquired, thereby often depriving him of
his means of livelihood. Again, acquisition of land
for private enterprises ought not to be placed on
the same footing as acquisition for the State or
for an enterprise under it. The individual and
institutions who are unavoidably to be deprived
of their property rights in land need to be
adequately compensated for the loss keeping in
view the sacrifice they have to make for the larger
interests of the community. The pendency of
acquisition proceedings for long periods often
causes hardship to the affected parties and
renders unrealistic the scale of compensation
offered to them.
133
2. It is necessary, therefore, to restructure the
legislative framework for acquisition of land so
that it is more adequately informed by this
objective of serving the interests of the
community in harmony with the rights of the
individual. Keeping the above objects in view and
considering the recommendations of the Law
Commission, the Land Acquisition Review
Committee as well as the State Governments,
institutions and individuals, proposals for
amendment to the Land Acquisition Act, 1894,
were formulated and a Bill for this purpose was
introduced in the Lok Sabha on the 30th April,
1982. The same has not been passed by either
House of Parliament. Since the introduction of
the Bill, various other proposals for amendment
of the Act have been received and they have also
been considered in consultation with State
Governments and other agencies. It is now
proposed to include all these proposals in a fresh
Bill after withdrawing the pending Bill….”
(emphasis added)
23. It is clear from the aforesaid objects and reasons that
by introducing the provisions of Section 11A and
17(3A) by way of amendment to the Act, greater
responsibility was fastened upon the concerned State
authorities, whereby they were obliged to make an
award within two years of the declaration made under
Section 6 of the Act. Thus the rights of the land owners
were sought to be protected by balancing the same
against the rights of the State. In respect of emergency
134
provisions where land is acquired without a hearing, it
is provided under Section 17(3A) that before taking
possession either under Section 17(1) and 17(2) it was
obligatory upon the authorities concerned to pay 80
per cent of the estimated compensation to the land
owners. This was also for protecting the right of the
land owners.
24. These amendments along with Statement, Objects and
Reasons are very crucial in interpretation of some of
the amended provisions. The amendment was brought
about in 1984 and by that time, the contents and
reach of Fundamental Rights in Part III, as interpreted
by this Court had assumed a very expansive profile. In
view of the mandate of Article 13, the provision of the
said Act must be tested on the anvil of the broad
interpretation of Fundamental Rights given by this
Court. In view of the decision of this Court in Maneka
Gandhi v. Union of India & Another – (1978) 1 SCC
248, the interpretation of Part III rights namely rights
under Article 14, 19 and 21 given therein by this
Court, read with Article 141, becomes the law of the
135
land. Therefore, the reach of Article 13(1) is
correspondingly widened. Thus, the 1984 amendments
must be construed as a conscious attempt by the
legislature being aware of the expansive interpretation
of Fundamental Rights by this Court, to bring the said
act consistent with the rights of the citizens and
persons in Part III.
25. Despite the fact that Right to Property in terms of
Article 19(1)(f) of the Constitution stood deleted from
Chapter III of the Constitution, vide 44th Constitutional
Amendment, 1978, Article 300A of the Constitution
was added by the same Constitutional Amendment,
mandating that ‘no person shall be deprived of his
property save by authority of law’. This indicates that
the Constitution still mandates that right to property
may have ceased to be a fundamental right, but it is
still protected by the Constitution and is a
Constitutional right. Constitution also provides that
deprivation of that right cannot be brought about save
by authority of law.
136
26. It is accepted in every jurisprudence and by different
political thinkers that some amount of property right is
an indispensable safeguard against tyranny and
economic oppression of the Government. Jefferson was
of the view that liberty cannot long subsist without the
support of property. “Property must be secured, else
liberty cannot subsist” was the opinion of John Adams.
Indeed the view that property itself is the seed bed
which must be conserved if other constitutional values
are to flourish is the consensus among political
thinkers and jurists. The U.S. Supreme Court in
Dorothy Lynch v. Household Finance Corporation,
405 US 538: 31 L Ed. 2d 424 held:
“….the dichotomy between personal liberties and
property rights is a false one. Property does not
have rights. People have rights. The right to
enjoy property without unlawful deprivation, no
less than the right to speak or the right to travel,
is in truth a “personal” right, whether the
“property” in question be a welfare check, a
home, or a savings account. In fact, a
fundamental interdependence exists between the
personal right to liberty and the personal right
in property. Neither could have meaning without
the other. That rights in property are basic civil
rights has long been recognized. J. Locke, of
Civil Government 82-85 (1924); J. Adams, A
Defence of the Constitutions of Government of
137
the United States of America, in F. Coker,
Democracy, Liberty, and Property 121-132
(1942); 1 W. Blackstone, Commentaries 138-
140...” (P.552 of the report)
27. Justice K.K. Mathew in his treatise on “Democracy,
Equality and Freedom”: (1978) very categorically
expressed the view:
“In a Society with a mixed economy, who can be
sure that freedom in relation to property might
not be regarded as an aspect of individual
freedom? People without property have a
tendency to become slaves. They become the
property of others as they have no property
themselves. They will come to say: “Make us
slaves, but feed us”. Liberty, independence, selfrespect,
have their roots in property. To denigrate
the institution of property is to shut one’s eyes to
the stark reality evidenced by the innate instinct
and the steady object of pursuit of the vast
majority of people. Protection of property interest
may quite fairly be deemed in appropriate
circumstances an aspect of freedom.” (P.38-39)
28. Explaining the interrelation between the right of
property and personal liberty, Learned Hand ruled that
property right is a personal right. (Learned Hand : The
Spirit of Liberty)
138
29. In our Constitution the word ‘law’ finds place both in
Article 21 and in Article 300A. The term ‘law’ in Article
21 has been interpreted by the Supreme Court from
time to time. In A.K. Gopalan v. State of Madras,
(AIR 1950 SC 27), the expression ‘law’ meant enacted
law, meaning thereby if the law was passed by a
competent legislature and was not violative of any
other provision of the Constitution, the law would be
valid. But the said interpretation does no longer hold
good after the epoch making decision of this Court in
Maneka Gandhi (supra), where this Court held the law
does not mean any enacted piece. According to the
majority decision in Maneka Gandhi (supra) “law is
reasonable law not any enacted piece” (para 85 page
338 of the report)
30. In Maneka Gandhi (supra) this Court held that the
expression ‘procedure established by law’ in Article 21
means a procedure established by a just, reasonable
and fair law. Thus the concept of due process of law
was incorporated in our constitutional framework by
139
way of judicial interpretation even though it was
rejected by the framers.
31. As a result of incorporation of this doctrine of ‘due
process’ in our constitutional framework, the concept
of Articles 14 and 21 has undergone a sea-change. In
Maneka Gandhi (supra), Justice Bhagwati, as His
Lordship then was, gave a very dynamic interpretation
of Articles 14 and 21.
32. Even prior to the decision in Maneka Gandhi (supra),
a Constitution Bench of this Court in R.C. Cooper v.
Union of India – (1970) 1 SCC 248 also gave a
composite and integrated interpretation of rights under
Part III of the Constitution. The question before this
Court in R.C. Cooper (supra) was whether the rights
under Articles 19(1)(f) and 31(2) are mutually
exclusive. Answering the said question, the majority of
the Constitution Bench, speaking through Shah, J.
analysed the different features of Fundamental Rights
in para 52 at page 289 of the report and came to a
conclusion that part III of the Constitution “weaves a
140
pattern of guarantees on the texture of basic human
rights. The guarantees delimit the protection of those
rights in their allotted fields: they do not attempt to
enunciate distinct rights.” (page 289)
33. In the following paragraph 53, the learned judges
further made it clear by saying:
“acquisition must be under the authority of a law
and the expression “law” means a law which is
within the competence of the Legislature, and
does not impair the guarantee of the rights in
Part III.”
34. In view of this clear enunciation of law by two
Constitution Benches of this Court and the wording of
Article 300A of the Constitution, let us examine the
correctness of the impugned Judgment of the High
Court which relies only on S.P. Jain’s case (supra).
35. The facts are totally different in S.P. Jain (supra). It is
clear from the facts in S.P. Jain (supra) that the third
respondent, the Krishi Utpadan Mandhi Samity, in
whose favour the land was acquired for construction of
market-yard, resolved on 13th January, 1989 to
withdraw from the acquisition as it was suffering from
141
a fund crunch and the proposed Mandhi site was far
away from Baraut (para 5).
36. The second round of litigation, out of which the
judgment in S.P. Jain (supra) was rendered by this
Court, was filed after the aforesaid resolution of the
third respondent was passed. Challenging the same,
the writ petition was filed before the High Court on 10th
August, 1989 wherein the writ petitioner prayed that
the State of Uttar Pradesh (the first respondent), The
Collector, Merrut (the second respondent) and the
Mandhi (the third respondent) be directed by Writ of
Mandamus to make and publish an award in respect
of the land. In that context this Court examined
various provisions of the Act and gave a direction upon
the first and second respondents to publish an award
within 12 weeks and imposed a cost of Rs.10,000/- on
the third respondent. In fact the writ petition in terms
of the prayer was allowed.
37. In coming to the aforesaid conclusion this Court held
that in a case where the emergency provisions are
142
invoked under Section 17 of the Act, the provisions of
Section 11A will not apply. And this Court came to an
incidental finding, though it was not strictly in issue,
that taking over the possession without making
payment under Section 17 (3A) of the Act is not illegal.
This finding was not at all necessary for deciding the
issue, namely whether prayer in the writ petition for
publishing the award was correctly made or not.
38. It has been held in the decision of this Court in
Municipal Corporation of Delhi v. Gurnam Kaur,
reported in AIR 1989 SC 38 that when a point does not
fall for decision of a Court but incidentally arises for its
consideration and is not necessary to be decided for
the ultimate decision of the case, such a decision does
not form a part of the ratio of the case but the same is
treated as a decision passed sub silentio. The concept
of ‘sub silentio’ has been explained by Salmond on
Jurisprudence “12th Edition” as follows:
“A decision passes sub silentio, in the technical
sense that has come to be attached to that
phrase, when the particular point of law involved
in the decision is not perceived by the Court or
143
present to its mind. The Court may consciously
decide in favour of one party because of point A,
which it considers and pronounces upon. It may
be shown, however, that logically the Court
should not have decided in favour of the
particular party unless it also decided point B in
his favour; but point B was not argued or
considered by the Court. In such circumstances,
although point B was logically involved in the
facts and although the case had a specific
outcome, the decision is not an authority on
point B. Point B is said to pass sub silentio.”
(page 43)
39. The aforesaid passage has been quoted with approval
by the three Judge Bench in Gurnam Kaur (supra).
This Court in Gurnam Kaur (supra), in order to
illustrate the aforesaid proposition further relied on the
decision of the English Court in Gerard v. Worth of
Paris Ltd., reported in 1936 (2) All England Reports
905. In Gerard, the only point argued was on the
question of priority of the claimant’s debt. The Court
found that no consideration was given to the question
whether a garnishee order could be passed. Therefore,
a point in respect of which no argument was advanced
and no citation of authority was made is not binding
and would not be followed. This Court held that such
decisions, which are treated having been passed sub
144
silentio and without argument, are of no moment. The
Court further explained the position by saying that one
of the chief reasons behind the doctrine of precedent is
that once a matter is fully argued and decided the
same should not be reopened and mere casual
expression carry no weight. In Gurnam Kaur (supra)
this Court conclusively held that not every passing
expression of a Judge, however eminent, can be
treated as “ex cathedra statement, having the weight of
authority” (see para 12 page 43)
40. Similarly, it has also been held by the majority opinion
in Constitution Bench of this Court in the case of
Madhav Rao Jivaji Rao Scindia v. Union of India,
reported in AIR 1971 SC 530 that “it is difficult to
regard a word, a clause or a sentence occurring in a
judgment of this Court, divorced from its context, as
containing a full exposition of the law on a question
when the question did not even fall to be answered in
that judgment.” (page 578 of the report)
145
41. In another Constitution Bench decision of this court in
Padma Sundara Rao (Dead) & Ors., v. State of Tamil
Nadu & others reported in (2002) 3 SCC 533, similar
views have been expressed by this Court in para 9, at
page 540 of the report wherein the unanimous
Constitution Bench of this Court opined:
“9. Court should not place reliance on decisions
without discussing as to how the factual
situation fits in with the fact situation of the
decision on which reliance is placed. There is
always peril in treting the words of a speech or
judgment as though they are words in a
legislative enactment, and it is to be remembered
that judicial utterances are made in the seting of
the facts of a particular case, said Lord Morris in
Herrington V. British Railways Board - (1972) AC
877. Circumstantial flexibility, one additional or
different fact may make a world of difference
between conclusions in two cases.”
42. The reason behind enacting Section 17 (3A) of the Act
is clear from the Statement of Object and Reasons
extracted above. It is clear therefore the provisions
were incorporated in order to strike a balance between
the rights of the State and those of the land owner. A
clear legislative intent in Section 17(3A) was thus
expressed that before taking possession of any land
146
under sub-section (1) or sub-section (2) of Section 17,
the Collector shall tender payment of 80% of the
estimated compensation for such land to the persons
interested and entitled thereto. This is the clear
mandate of law.
43. In view of the principles enunciated in R.C. Cooper
(supra) and Maneka Gandhi (supra), reasonableness
in law has to be its implicit content. Here no challenge
to the reasonableness of Section 17 (3A) is either
argued or considered by this Court. But when law
gives a specific mandate on the State to tender the
payment before taking possession under Section 17(1)
and Section 17(2) by invoking the emergency powers,
to hold that the taking over of possession without
complying with that mandate is legal is clearly to
return a finding which is contrary to the express
provision of the statute. Such a finding is certainly not
on a reasonable interpretation of Section 17 (3A).
Therefore, the casual observation in para 17 (page 375)
in S.P. Jain (supra) to the effect of taking possession
of land under emergency provision and without
147
making the payment mandated under Section 17(3A) is
a valid mode of taking possession is in clear violation
of Section 17(3A) and be regarded made per incuriam
and does not have the effect of a binding precedent.
44. If I look at the emergency provisions of the statute
which empowers the State to acquire land by
dispensing with the provisions of making an enquiry it
is clear that the said provision is a drastic provision. It
is well-known that the provisions of the said Act are
expropriatory in nature and must be strictly
construed. In that expropriatory legislation, Section 17
is a very drastic provision as Section 17 of the Act
seeks to authorize acquisition and taking over of
possession without hearing the land owner. This Court
held that the right of hearing which is given under
Section 5A of the Act and which is taken away in view
of the emergency acquisition is a very valuable right
and is akin to a fundamental right. (See Dev Sharan &
Ors. v. State of U.P. & Ors. - JT 2011 (3) SC 102).
Therefore, when that right is taken away and the land
is acquired by invoking the emergency provision of
148
Section 17(3A) to hold that even the safeguards
provided under Section 17(3A) are not mandatory and
taking over of possession without complying with the
provisions of Section 17 (3A) is not illegal is to overlook
the clear provisions of the Act and come to a finding
which is contrary to the Act. This Court is unable to
accept that the taking over of the possession by
invoking Section 17(1) or Section 17(2) of the Act and
without making the payment under Section 17(3A) is
legal taking over of possession.
45. This Court is of the view that Section 17(3A) is not an
isolated provision. Section 17(3A) figures very
prominently as part of the statutory mechanism in
Section 17 of the Act which confers special powers in
cases of urgency. Section 17 has four sub sections and
all these sub sections comprise a composite
mechanism and are closely intertwined. Power under
one sub section cannot be exercised without complying
with the conditions imposed by the other sub section.
For a proper appreciation of this question, section 17
with all its sub sections are set out:
149
“17. Special powers in cases of urgency. (1) In
cases of urgency, whenever the appropriate
Government, so directs, the Collector, though no
such award has been made, may, on the
expiration of fifteen days from the publication of
the notice mentioned in section 9, sub-section (1),
take possession of any land needed for a public
purpose. Such land shall thereupon vest
absolutely in the Government, free from all
encumbrances.
(2) Whenever, owing to any sudden change in the
channel of any navigable river or other
unforeseen emergency, it becomes necessary for
any Railway administration to acquire the
immediate possession of any land for the
maintenance of their traffic or for the purpose of
making thereon a river-side or ghat station, or of
providing convenient connection with or access to
any such station, or the appropriate Government
considers it necessary to acquire the immediate
possession of any land for the purpose of
maintaining any structure or system pertaining to
irrigation, water supply, drainage, road
communication or electricity, the Collector may,
immediately after the publication of the notice
mentioned in sub-section (1) and with the
previous sanction of the appropriate Government,
enter upon and take possession of such land,
which shall thereupon vest absolutely in the
Government free from all encumbrances:
Provided that the Collector shall not take
possession of any building or part of a building
under this sub-section without giving to the
occupier thereof at least forty-eight hours' notice
of his intention so to do, or such longer notice as
may be reasonably sufficient to enable such
occupier to remove his movable property from
such building without unnecessary
inconvenience.
150
(3) In every case under either of the preceding
sub-sections the Collector shall at the time of
taking possession offer to the persons interested
compensation for the standing crops and trees (if
any) on such land and for any other damage
sustained by them caused by such sudden
dispossession and not excepted in section 24;
and, in case such offer is not accepted, the value
of such crops and trees and the amount of such
other damage shall be allowed for in awarding
compensation for the land under the provisions
herein contained.
(3A) Before taking possession of any land under
sub-section (1) or sub-section (2), the Collector
shall, without prejudice to the provisions of subsection
(3),-
(a) tender payment of eighty per centum of the
compensation for such land as estimated by him
to the persons interested entitled thereto, and
(b) pay it to them, unless prevented by some one
or more of the contingencies mentioned in section
31, sub-section (2),
and where the Collector is so prevented, the
provisions of section 31, sub-section (2), (except
the second proviso thereto), shall apply as they
apply to the payment of compensation under that
section.
(3B) The amount paid or deposited under subsection
(3A), shall be taken into account for
determining the amount of compensation
required to be tendered under section 31, and
where the amount so paid or deposited exceeds
the compensation awarded by the Collector under
section 11, the excess may, unless refunded
within three months from the date of the
Collector's award, be recovered as an arrear of
land revenue.
151
(4) In the case of any land to which, in the
opinion of the appropriate Government, the
provisions of sub-section (1) or sub-section (2) are
applicable, the appropriate Government may
direct that the provisions of section 5A shall not
apply, and, if it does so direct, a declaration may
be made under section 6 in respect of the land at
any time after the date of publication of the
notification under section 4, sub-section (1).”
46. Sub-section (3A) of Section 17 is linked with sub
section (2) of Section 31. Sub section (2) of Section 31
runs thus:
“(2) If they shall not consent to receive it, or if
there be no person competent to alienate the
land, or if there be any dispute as to the title to
receive the compensation or as to the
apportionment of it, the Collector shall deposit
the amount of the compensation in the Court to
which a reference under section 18 would be
submitted:
Provided that any person admitted to be
interested may receive such payment under
protest as to the sufficiency of the amount:
Provided also that no person who has received
the amount otherwise than under protest shall be
entitled to make any application under section
18:
Provided also that nothing herein contained shall
affect the liability of any person, who may receive
the whole or any part of any compensation
awarded under this Act, to pay the same to the
person lawfully entitled thereto.”
152
47. It is thus clear that sub section (3A) of Section 17 read
with sub section (2) of Section 31 of the Act form a
composite statutory scheme. The said scheme has
been legislatively framed to balance the promotion of
public purpose in acquisition with rights of the
individual whose land is acquired. This is clear from
the Statement of Objects and Reasons which was kept
in view for bringing about the amendment of the said
Act by Amendment Act 68 of 1984. By the said
amendment Section 17(3A) was brought on the
statute.
48. Therefore, the provision of Section 17(3A) cannot be
viewed in isolation as it is an intrinsic and mandatory
step in exercising special powers in cases of
emergency. Sections 17(1) and 17(2) and 17(3A) must
be red together. Section 17(1) and 17(2) cannot be
worked out in isolation.
49. It is well settled as a canon of construction that a
statute has to be read as a whole and in its context. In
Attorney General v. HRH Prince Earnest Augustus
153
of Hanover, reported in (1957) 1 AER 49, Lord
Viscount Simonds very elegantly stated the principle
that it is the duty of Court to examine every word of a
statute in its context. The learned Law Lord further
said that in understanding the meaning of the
provision, the Court must take into consideration “not
only other enacting provisions of the same statute, but
its preamble, the existing state of the law, other
statutes in pari material, and the mischief which I can,
by those and other legitimate means, discern that the
statute was intended to remedy” (page 53 of the
report).
50. Lord Normand expressed the same view differently and
which is equally pertinent and worth remembering and
parts of which are excerpted below:
“The key to the opening of every law is the reason
and spirit of the law – it is the animus
imponentis, the intention of the law maker,
expressed in the law itself, taken as a whole.
Hence to arrive at the true meaning of any
particular phrase in a statute, that particular
phrase is not to be viewed detached from its
context … meaning by this as well the title and
the preamble as the purview or enacting part of
the statute” (page 61 of the report).
154
51. These principles have been followed by this Court in its
Constitution Bench decision in Union of India v.
Sankalchand Himatlal Sheth & anr., [(1977) 4 SCC
193]. At page 240 of the report, Justice Bhagwati, as
His Lordship then was, in a concurring opinion held
that words in a statute cannot be read in isolation,
their colour and content are derived from their context
and every word in a statute is to be examined in its
context. His Lordship explained that the word context
has to be taken in its widest sense and expressly
quoted the formulations of Lord Viscount Simonds, set
out above. (See para 54, P.241 of the report).
52. In this connection, if I compare the normal mode of
vesting of acquired property under Section 16 of the
Act with the mode of vesting under emergency
provisions of Section 17 thereof, I will discern that
under the said Act the vesting of acquired property in
the State presupposes compliance with two conditions.
Under Section 16, first there has to be an award under
155
section 11 and then there has to be taking over of
possession. Only thereupon the land shall vest
absolutely in the state, free from all encumbrances.
Section 16 of the act which makes it clear is as under:
“16. Power to take possession.- When
the Collector has made an award under
section 11, he may take possession of the land,
which shall thereupon vest absolutely in the
Government, free from all encumbrances.”
53. But in case of emergency acquisition, possession is
taken before the making of an award. This is clear
from section 17(1) and section 17(2). But the intention
of the legislature is that even though the award is not
made, payment mandated under Section 17(3A) must
be made before possession is taken either under
Section 17(1) and 17(2). Therefore this provision
relating to payment under Section 17(3A) is a condition
precedent to the vesting of land under Section 17(1)
and 17(2). In the later part of this judgment, I shall
discuss some authorities which have opined that when
possession is illegally taken over without following the
conditions precedent for taking such possession,
156
vesting of a property in law does not take place in the
authority which thus illegally enters upon the
property.
54. Judicial opinion is uniformly in favour of strict
construction of an expropriatory law which admittedly
Land Acquisition Act, 1894 is. Reference in this
connection can be made to the observations of
Cottenham, L.C. in Webb v. Manchester and Leeds
Rail Co . , [(1839), 4 Myl. & Cr.116] where the Lord
Chancellor held:
“The powers are so large - it may be necessary for
the benefit of the people – but they are so large,
and so injurious to the interests of the
individuals, that I think it is the duty of every
court to keep them most strictly within those
powers; and if there be any reasonable doubt as
to the extent of their powers, they must go
elsewhere and get enlarged powers; but they will
get none from me by way of construction of their
Act of Parliament.”
55. In the Indian context, as early as in 1916. Judicial
committee of Privy Council in Secretary of State for
India v. Birendra Kishore Manikya (ILR 44 Cal 328),
speaking through Lord Dunedin held, ‘the Act is
157
drastic in its character and makes invasion in private
rights…matter must be brought “strictly within its
provisions”.’ (p 343)
56. Cripps in “The Law of Compensation for Land Acquired
under Compulsory Powers” (8th ed., Stevens and Sons,
Ltd.) has quoted the above opinion of the Lord
Chancellor and further dealt with this aspect of the
matter at page 27 of the book wherein the learned
author said, “Where the promoters of a public
undertaking have authority from Parliament to
interfere with private property on certain terms, any
person whose property is interfered with by virtue of
that authority has a right to require that the promoters
shall comply with the letter of the enactment, so far as
it makes provision on his behalf.” Again at page 100,
the learned author has stressed the above position
very strongly to the following effect:-
“If no consent has been given, and the
promoters have not complied with the statutory
conditions as to entry on lands, they can be
proceeded against as trespassers by any owner
who has an interest in the lands. The principle
is that all statutory conditions which have been
158
imposed as condition precedent to an entry on
lands must be fulfilled.”
57. In support of this aforesaid proposition, the learned
author has relied on Parkdale Corporation v. West
[(1887), 12 App. Cas. 602, 614].
58. And again at page 173, the learned author opines:
“It must be borne in mind that promoters have
no powers, other than those comprised in their
special Acts and the Acts therewith incorporated,
to enter upon or take lands against the wish of
the owners. It is incumbent on promoters to
comply with all conditions and limitations
imposed upon them, and, unless they have so
complied, any interested owner can restrain them
by injunction from taking, as against him, further
proceedings”.
I am in respectful agreement with the aforesaid
principles.
59. I find that same principles have been laid down in
Cooley’s ‘A Treatise on the Constitutional Limitations’
Volume II, (Eight Edition). Cooley while dealing with the
concept of ‘Eminent Domain’ in Chapter 15 opined
(p.1120):
“…whenever in pursuance of law the property of
an individual is to be divested by proceedings
159
against his will, a strict compliance must be had
with all the provisions of law which are made for
his protection and benefit, or the proceeding will
be ineffectual. Those provisions must be
regarded as in the nature of conditions
precedent, which are not only to be observed
and complied with before the right of the
property owner is disturbed, but the party
claiming authority under the adverse proceeding
must show affirmatively such compliance”.
(emphasis added)
60. The learned author explained the aforesaid proposition
with certain illustration which very closely fit in with
the legal framework with which I am concerned in this
case. The learned author said:
“So if the statute vests the title to lands
appropriated in the state or in a corporation on
payment therefore being made, it is evident that,
under the rule stated, the payment is a condition
precedent to the passing of the title.”
(Emphasis added)
61. Reference in this connection should be made to the
decision of Supreme Court of Vermont in Henry B.
Stacey v The Vermont Central Railroad Co, (27 Vt.
39). In that case, while discussing the concept of
Eminent Domain, the court after referring to various
decisions held “that this provision (relating to deposit
160
of the appraised value) should be considered in the
nature of a condition precedent, not only to the
acquisition of the legal title to the land, but also to the
right to enter and take the permanent possession of
the land for the use of the corporation.”
62. The expression condition precedent has been defined in
Words and Phrases (permanent edition, Vol. 8. St.
Paul, Minn, West Publishing Co., 1951, p 629) as those
which ‘must be punctually performed before the estate
can vest’. Similarly, in Bouvier’s Law Dictionary, (A
Concise encyclopedia of the Law, Rawle’s Third
Revision, Vol. 1, Vernon Law Book Company, 1914, p
584), virtually the same principles have been followed.
The learned author expressed this even more strongly
by explaining that:
“The effect of a Condition precedent is, when
performed, to vest an estate, give rise to an
obligation, or enlarge an estate already vested;
[…]. Unless a condition precedent be performed,
no estate will vest; and this even where the
performance is prevented by the act of God or of
the law; […].”
161
63. In Wharton’s Law Lexicon, it has been held that
conditions precedent in their primary meaning are
those events, but for the happenings of which rights
will not arise. (Wharton’s Law Lexicon, 1976, reprint, p
228).
64. In the case of Gujarat Electricity Board v Girdharlal
Motilal And Anr (AIR 1969 SC 267), this court while
dealing with the power of the State Electricity Board to
purchase the property of the licensee held that right
can be exercised only in the manner provided in the
act and not in any other way. The court held that since
this power of the Board under the law is to interfere
with the property rights of the licensee, such power
will have to be strictly construed. In laying down the
said principle this court relied on the well-known
doctrine in case of Nazir Ahmad v King Emperor [AIR
1936 PC 253] that when a power is to be exercised in a
manner it has to be exercised in that manner alone
and in no other manner. In two other recent
judgments, this court reiterated the same principle,
and held that expropriatory statute, as is well known,
162
must be strictly construed. [See Hindustan Petroleum
corpn. Ltd., v. Darius Shapur Chenai and others
reported in (2005) 7 SCC 627]. The said principle has
also been followed by this Court in the case of Bharat
Petroleum Corporation Ltd. v Maddula Ratnavalli
and Others [(2007) 6 SCC 81] where learned judges
relying on Hindustan Petroleum reiterated the same
principle of strict construction of expropriatory
legislation (p 91).
65. In an earlier decision Jilubhai Nanbhai Khachar
and others v State of Gujarat and Anr [1995 Suppl
(1) SCC 596], this Court while dealing with the concept
of eminent domain and right to property in Article
300A held as follows (para 50, p. 628):
“50. All modern constitutions of democratic
character provide payment of compensation as
the condition to exercise the right of
expropriation. Commonwealth of Australia Act, a
Frecnh Civil Code (Article 545), the 5th
Amendment of the Constitution of USA and the
Italian constitution provided principles of “just
terms”, “Just indemnity”, Just compensation” as
reimbursement for the property taken, have been
provided for. As pointed out in Halsbury’s Law of
England that “when Parliament has authorized
the compulsory acquisition of land it is almost
invariably provided for payment of a money
163
compensation to the person deprived of his
interest in it.”
66. On the basis of aforesaid principles, I hold that the
requirement of payment under section 17(3A) is in the
nature of condition precedent clamped by the statute
before taking possession under emergency acquisition
by the State. The vesting contemplated either under
Section 17(1) or 17(2) of this Act is conditioned upon
payment mandated under Section 17(3A). This is clear
from the opening words of Section 17(3A) namely
“before taking possession of any land either under
sub-section (1) or (2), Collector shall……. tender
payment.” Therefore, the eminent domain concept is
subject to the aforesaid statutory condition and must
be read subject to due process concept introduced in
our constitutional law in Maneka Gandhi (supra). If I
read, Section 17(3A) as I must, consistently with the
constitutional doctrine of due process as articulated in
the expression ‘authority of law’ under Article 300A
which constitutionally protects deprivation of a right to
164
property, save by authority of law, the conclusion in
my judgment is inescapable that the requirement of
section 17(3A) constitutes the authority of law within
the meaning of Article 300A. Therefore, in the context
of aforesaid statutory dispensation and constitutional
provision, the debate whether the provision of section
17(3A) is mandatory or directory does not present
much difficulty for the reasons discussed above and
also for the following reasons.
67. Basically, the language used is ‘shall’ which primarily
indicates mandatory compliance. That apart, in the
context of the nature of statute which is admittedly
expropriatory in character and the nature of the
statutory requirement under section 17(3A) which is
clearly and undoubtedly a condition precedent to the
taking over of possession in emergency acquisition,
there can be no doubt that the requirement under
section 17(3A) is mandatory.
68. Section 17(3A) has been enacted for protecting the
rights of deprived land-loser in an emergency
165
acquisition. The said provision is therefore based on
reason, justice and fairplay. Since the said provision
has been introduced by way of an amendment as
noted above to balance the right of the state as against
the interest of the land-loser, the State’s power of
eminent domain is expressly made subject to aforesaid
statutory provision as also the constitutional right to
property protected under Article 300A. Right to
property has been pronounced as fundamental human
right by this Court in Chairman, Indore Vikas
Pradhikaran v. Pure Industrial Coke & Chemicals
Ltd., and others reported in (2007) 8 SCC 705.
69. The expression ‘law’ which figures both in Article 21
and Article 300A must be given the same meaning. In
both the cases the law would mean a validly enacted
law. In order to be valid law it must be just, fair and
reasonable having regard to the requirement of Article
14 and 21 as explained in Maneka Gandhi (supra).
This is especially so, as ‘law’ in both the Articles 21
and 300A is meant to prevent deprivation of rights.
Insofar as Article 21 is concerned, it is a Fundamental
166
Right whereas in Article 300A it is a constitutional
right which has been given a status of a basic human
right.
70. I, therefore, hold that Section 17(3A) of the Act is a law
which has been enacted to prevent deprivation of
property rights guaranteed under Article 300 A. This
provision of Section 17(3A) must therefore be given a
very broad interpretation to mean a law that gives a
fair, just and reasonable protection of the land-loser’s
constitutional right to property.
71. Therefore, the provisions of section 17(3A) read with
Article 300A must be liberally construed. Reference in
this connection be made to the majority opinion in the
Constitution Bench decision in the case of Madhav
Rao Jivaji Rao Scindia (supra). Shah, J., speaking
for the majority opinion observed (para 33, p 576):
“The court will interpret a statute as far as
possible, agreeably to justice and reason and that
in case of two or more interpretations, one which
is more reasonable and just will be adopted, for
there is always a presumption against the law
maker intending injustice and unreason. The
court will avoid imputing to the Legislature an
intention to enact a provision which flouts
167
notions of justice and norms of fairplay, unless a
contrary intention is manifest from words plain
and unambiguous. A provision in a statute will
not be construed to defeat its manifest purpose
and general values which animate its structure.
In an avowedly democratic polity, statutory
provisions ensuring the security of fundamental
human rights including the right to property will,
unless the contrary mandate be precise and
unqualified, be construed liberally so as to
uphold the right. These rules apply to the
interpretation of constitution and statutory
provisions alike.”
72. On the above premise, taking over a possession of land
without complying with the requirement of section
17(3A) is clearly illegal and in clear violation of the
statutory provision which automatically violates the
constitutional guarantee under Article 300A. A passing
observation to the contrary in S.P. Jain (supra) must
pass sub silentio being unnecessary in the facts of the
case as otherwise such a finding is per incuriam, being
in violation of the statute. A fortiorari the said finding
cannot be sustained as a binding precedent.
73. For the reason aforesaid, this Court holds that the writ
petition cannot be dismissed in view of the decision in
S.P. Jain (supra) which was decided on totally
168
different facts. The judgment of the High Court is set
aside.
74. This court further holds that in all cases of emergency
acquisition under section 17, the requirement of
payment under section 17(3A) must be complied with.
As the provision of section 17(1) and section 17(2)
cannot be worked out without complying with
requirement of payment under section 17(3A) which is
in the nature of condition precedent. If section 17(3A)
is not complied with, the vesting under section 17(1)
and section 17(2) cannot take place. Therefore,
emergency acquisition without complying with section
17(3A) is illegal. This is the plain intention of the
statute which must be strictly construed. Any other
construction, in my opinion, would lead to diluting the
Rule of Law.
75. However, coming to the question of relief in the instant
case, the Court has to take note of the fact situation.
Admittedly, possession of the land has been taken and
same has been handed over to the beneficiary on
169
which construction had taken place and third party
interests had arisen. It is very difficult to put the
hands of the clock back now, despite the aforesaid
declaration of law by the Court. This Court, therefore,
has to think in terms of adequately compensating the
appellants. In the special facts of this case,
compensation in respect of the land acquired insofar
as the appellants are concerned cannot be decided on
the basis of the date of notice under Section 4.
76. In view of the discussions above, the compensation
has to be fixed with regard to the value of the
appellant’s land as on the date of filing of the writ
petition which was in March, 2006 before the High
Court. The section 4 notification must be deemed to
have been issued on March 1, 2006 and the
compensation must be worked out on that basis. An
award on that basis must be passed by the Collector
within four months from date and the appellants are
given liberty, if so advised, to challenge the same in
appropriate proceedings. All questions relating to
compensation in aforesaid proceeding are kept open
170
for both the parties. As the respondent – the acquiring
authority has proceeded illegally in the matter, it must
pay costs of Rupees one lakh in favour of Allahabad
High Court Mediation Centre within a period of six
weeks from date. The State is at liberty to recover the
same from the erring officials.
77. The appeal is, thus, allowed with costs as aforesaid.
.............................................J.
[Asok Kumar Ganguly]
New Delhi
August 18, 2011
171
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.24 OF 2009
M/s. Delhi Airtech Services
Pvt. Ltd. & Anr. … Appellants
Versus
State of U.P. & Anr. … Respondents
O R D E R
In view of the divergence of opinion on conclusions and also on
various legal questions discussed in two separate judgments by us, the
matter is required to be placed before the Hon’ble the Chief Justice of
India for reference to a larger Bench to resolve the divergent views
expressed in both the judgments and to answer the questions of law
framed.
.............................................J.
[Asok Kumar Ganguly]
.............................................J.
[Swatanter Kumar]
New Delhi
August 18, 2011
172
Anirudh
(Expert) 31 January 2013
Sorry. I misread your query.
Instead of giving you the latest position, I inadvertently pasted the decision.
Shailesh Kr. Shah
(Querist) 01 February 2013
Dear Mr.Aniruddh,
No Issue. I am sure that Shri R.K. Nanda will provide latest position.
V R SHROFF
(Expert) 01 February 2013
tried but could not get what u want.
Raj Kumar Makkad
(Expert) 03 February 2013
It seems that the matter is still pending before CJI and no larger bench still seems constituted as nothing is appearing against this judgment.
