Pandit Jhandu Lal & Ors Vs. The
State of Punjab & Ors [1960] INSC 198 (16 November 1960)
SINHA, BHUVNESHWAR P.(CJ) KAPUR, J.L.
GAJENDRAGADKAR, P.B.
SUBBARAO, K.
WANCHOO, K.N.
CITATION: 1961 AIR 343 1961 SCR (2) 459
CITATOR INFO :
R 1962 SC 764 (5) RF 1963 SC 151 (34) R 1965
SC 427 (3) RF 1965 SC 646 (9,11) RF 1966 SC1788 (18) R 1970 SC 984 (6) F 1977
SC 594 (3) C 1980 SC 367 (11)
ACT:
Land Acquisition--Constitutional validity of
enactment Construction of labour colony for a company, if a Public
purpose--Test-Land Acquisition Act, 1894 (1 of 1894), ss. 4, 6, Part
VII--Constitution of India, Arts. 31(2), 31(5)(a).
HEADNOTE:
The Punjab Government issued notification
under ss. 4 and 6 of the Land Acquisition Act, 1894, and started proceedings
for acquisition of lands for the construction of a labour colony under the
Government sponsored Housing Scheme for the workers of the Thapar Industrial
Workers' Co-operative Housing Society Ltd. The appellants challenged the acquisition
proceedings under Art. 226 of the Constitution on the ground, inter alia, that
the procedure prescribed by Part VII of the said Act had not been admittedly
complied with.
The Division Bench in affirming the order of
dismissal passed by the trial judge held that although Art. 31 of the
Constitution by prohibiting compulsory acquisition of property except for a
public purpose had made Part VII of the Act redundant, the present proceedings
were saved since the acquisition was for a public purpose.
Held, that the High Court was in error in
holding that the Constitution had rendered Part VII of the Land Acquisition
Act, 1894, redundant or null and void, although it was right in dismissing the
appeal. That Act, as an existing Act, was saved by Art. 31(5)(a) from being
affected by Art. 31(2) of the Constitution.
Acquisition of building sites for residential
houses for industrial labour is for a public purpose even apart from s. 17(2)
460 (b)of the Act as amended by ':the Land Acquisition (Punjab Amendment) Act
of 1953.
Babu Barkava Thakur v. The State of Bombay
[1961] 1 S.C.R.
128, referred to.
Although in the case of an acquisition for a
company simpliciter, no declaration under s. 6 of the Act can be made without
complying with the provisions of Part VII of the Act, it is not correct to say
that no acquisition for a company for a public purpose can be made except under
Part VII of the Act. If the cost of the acquisition is borne either wholly or
partially by the Government, the purpose would be a public purpose within the
meaning of the Act.
But if the cost is entirely borne by the
company it would be an acquisition for the company simpliciter and Part VII
would apply.
Since in the instant case a part of the
compensation was to be borne by the Government, it was not necessary to comply
with the provisions of Part VII of the Act.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 4 of 1960.
Appeal by special leave from the Judgment and
Order dated January 28, 1959 of the Punjab High Court in Letters Patent Appeal
No. 52 of 1958 arising out of the Judgment and Order dated February 17, 1958 of
the said High Court in Civil Writ Application No. 124 of 1957.
C. B. Aggarwala, Daya Swarup Mehra and R. S.
Gheba, for the appellants.
S. M. Sikri, Advocate General for the State
of Punjab, N.S. Bindra and D. Gupta, for respondent No. 1.
C.K. Daphtary, Solicitor General of India and
S. N. Andley, for Respondent No. 2.
C.K. Daphtary, Solicitor General of India and
T.M. Sen, for the Attorney-General for India (Intervener).
1960. November 16. The Judgment of the Court
was delivered by SINHA, C. J.-This appeal, by special leave granted on May 29,
1959, is directed against the decision of the Letters Patent Bench (G. D.
Khosla, C. J., and Dulat, J.) dated January 28, 1959, affirming that of the
learned single Judge (Bishan Narain, J.) dated February 17, 1958, whereby he
dismissed the 461 appellants' Writ Petition under Art. 226 of the Constitution.
It appears that the appellants are the owners
of, what is said to be, agricultural land, measuring about 86 bighas odd, in
village Munda Majra, Tehsil Jagadhari, in the district of Ambala. On October
27, 1954, the Additional District Magistrate of Ambala ordered the land
aforesaid to be requisitioned under the Punjab Requisitioning & Acquisition
of Immoveable Property Act (XI of 1953) for the construction of houses by
members of the Thapar Industries Co-operative Housing Society Ltd., Yamuna
Nagar. Possession of the land was taken on November 5, 1954. The appellants, at
once, instituted a suit on November 14, 1954, in the Court of the Subordinate
Judge, Jagadhari, challenging the requisition proceedings. The suit was
ultimately decreed by the Court on June 21, 1955, and the possession of the
property in question was restored to the petitioners. On May 27, 1955, the
first respondent, i. e., the State of Punjab, through the Secretary, Labour
Department, issued a notification under s. 4 of the Land Acquisition Act (1 of
1894) (which hereinafter will be referred to as the Act).
The notification, under s. 4 is in these
terms.
"No. 4850-S-LP-55/14144. Whereas it
appears to the Governor of Punjab that land in the locality hereunder specified
is likely to be needed by the Government for a public purpose, namely, for the
construction of a Labour Colony under the Government sponsored Housing Scheme
for the Industrial Workers of the Thapar Industrial Workers' Co-operative
Housing Society Limited, Jamna Nagar (District Ambala), it is hereby notified
that the land described in the specifications below is likely to be required
for the above purpose.
This notification is made under the
provisions of Section 4 read with section 17 of the Land Acquisition Act, 1894,
as amended by the Land Acquisition (Punjab Amendment) Act, 1953, to all to whom
it may concern and the Collector shall cause public notice of the substance of
this notification to be given at convenient places in the said locality;
462 In exercise of the powers conferred by
the aforesaid sections, the Governor of the Punjab is pleased to authorise the
President of the above said Society with the members and servants to enter upon
and survey any land in the locality and do all other acts required or permitted
by that section.
Further in exercise of the powers conferred
by sub-section (4) of Section 17 of the said Act the Governor of Punjab is
pleased to direct that, on the grounds of urgency, the provisions of Section
5(a) of the said Act, shall not apply in regard to this Acquisition".
Later, the same day, another notification, under
s. 6 of the Act, was issued. This notification, under s. 6, states that it
appeared to the Governor of Punjab that the land is required to be taken by
Government for a public purpose, namely, for the construction of a Labour
Colony under the Government sponsored Housing Scheme for the' Industrial
Workers of the Thapar Industrial Workers' Co-operative Housing Society Limited
(which is the second respondent in this case). It also says that under the
provisions of s. 7 of the Act, the Collector, Ambala, is directed to take order
for the acquisition of the land. The Patwari effected delivery of possession of
the lands in question to the second respondent on August 21, 1955. Even before
the delivery of possession had been effected, the appellants promptly instituted
their suit on August 20, 1955, in the Court of the Subordinate Judge Class 1,
Jagadhari, for a perpetual injunction restraining the second respondent from
entering upon or taking possession of the land in question, or making any
construction thereon. The trial Court dismissed the suit on June 25, 1956, on
the preliminary ground that the suit was not competent in the absence of a
previous notice under s. 59 of the Punjab Co-operative Societies Act, 1955 (XIV
of 1955). The appellants appealed to the Senior Sub-Judge, Ambala, who
dismissed their appeal, upholding the decision of the trial Court that the
notice was a condition precedent to the institution of the suit.
Their second appeal was dismissed by the
Punjab High Court on February 6,1957. During the pendency of the civil
litigation aforesaid, in spite of the fact that the second respondent had 463
obtained delivery of possession through Government agency, by an Order of
Injunction issued by the Court, construction had been stayed. As soon as the
High Court decided the suit in favour of the respondents, the second respondent
"started making huge constructions on the land in dispute in a very speedy
manner", as alleged by the appellants in their petition under Art. 226 of
the Constitution, which they filed on February 13, 1957. From the High Court
also, they obtained similar Stay Orders whereby building operations were
stopped. In their Writ Petition, the appellants, as petitioners in the High
Court, challenged the acquisition proceedings on a number of grounds, of which
it is only necessary to notice the one which has formed the subject matter of
decision in the High Court, namely, that the proceedings were void for want of
compliance with the procedure laid down in Chapter VII (mistake for Part VII)
of the Act. It is not necessary to refer to the other contentions raised in the
Writ Petition, because it is common ground before us that the whole controversy
must be determined by the answer to the question, 'whether or not the
proceedings were vitiated by reason of the admitted fact that no proceedings
under Part VII of the Act had been taken in making the acquisition'.
The matter was heard, in the first instance,
by Bishan Narain, J. The learned Judge dismissed the petition, holding that the
acquisition was by the Government for a public purpose, namely, of construction
of tenements for industrial workers, under a schempeal against the order to the
Collector of the district or such other officer as may, by notification, be
authorised in this behalf by the State Government.
629 Section 6 imposes a restriction on the
transport of agricultural cattle for slaughter and reads:
"S. 6. No person shall transport or
offer for trans port or cause to be transported any agricultural cattle from
any place within the State to any place outside the State, for the purpose of
its slaughter in contra.
vention of the provisions of this Act or with
the knowledge that it will be or is likely to be, so slaughtered." Section
7 prohibits the sale, purchase or disposal otherwise of certain kinds of
animals. It reads-.
"S. 7. No person shall purchase, sell or
otherwise dispose of or offer to purchase, sell or otherwise dispose of or
cause to be purchased, sold or otherwise disposed of cows, calves of cows or
calves of she buffaloes for slaughter or knowing or having reason to believe
that such cattle shall be slaughtered." Section 8 relates to possession of
flesh of agricultural cattle and is in these terms:
"S. 8. Notwithstanding anything
contained in any other law for the time being in force, no person shall have in
his possession flesh of any agricultural cattle slaughtered in contravention of
the provisions of this Act." Section 10 imposes a penalty for a
contravention of s. 4(l)(a) and s. 11 imposes penalty for a contravention of
any of the other provisions of the Act.
On behalf of the petitioners it has been
pointed out, and rightly in our opinion, that cl. (a) of sub-s. (2) of s. 4 of
the Act imposes an unreasonable restriction on the right of the petitioners. That
clause in its first part lays down that the cattle (other than cows and calves)
must be over 20 years of age and must also be unfit for work or breeding; and
in the second part it says, "or has become permanently incapacitated from
work or breeding due to age, injury, deformity or an incurable disease."
It is a little difficult to understand why the two parts are juxtaposed in the
section. In any view the restriction that the animal must be over 20 years of
age and also unfit for work or breeding is an excessive or unreasonable
restriction as we have 80 630 pointed out with regard to a similar provision in
the Uttar Pradesh Act. The second part of the clause would not be open to any
objection, if it stood by itself. If, however, it has to be combined with the
age limit mentioned in the first part of the clause, it will again be open to
the same objection; if the animal is to be over 20 years of age and also
permanently incapacitated from work or breeding etc., then the agelimit is
really meaningless. Then, the expression 'due to age' in the second part of the
clause also loses its meaning. It seems to us that cl. (a) of sub-s. (2) of s.
4 of the Act as drafted is bad because it imposes a disproportionate
restriction on the slaughter of bulls, bullocks and buffaloes it is a
restriction excessive in nature and not in the interests of the general public.
The test laid down is not merely permanent
incapacity or unfitness for work or breeding but the test is something more
than that, a combination of age and unfitness' Learned Counsel for the
petitioners has placed before us an observation contained in a reply made by
the Deputy Minister in the course of the debate on the Bill in the Madhya
Pradesh Assembly (see Madhya Pradesh Assembly Proceedings, Vol. 5 Serial no. 34
dated April 14, 1959, page 3201). He said that the age fixed was very much
higher than the one to which any animal survived. This observation has been
placed before us not with a view to an interpretation of the section, but to
show what opinion was held by the Deputy Minister as to the proper age limit.
On behalf of the respondent State our attention has been drawn to a book called
The Miracle of Life (Home Library Club) in which there is a statement that
oxen, given good conditions, live about 40 years. Our attention has also been
drawn to certain extracts from a Hindi book called Godhan by Girish Chandra
Chakravarti in which there are statements to the effect that cows and bullocks
may live up to 20 or 25 years. This is an aspect of the case with which we have
already dealt. The question before us is not the maximum age upto which bulls,
bullocks and buffaloes may live in rare cases. The question before us is what
is their average longevity and at what age 631 they become useless. On this
question we think that the opinion is almost unanimous, and the opinion which
the Deputy Minister expressed was not wrong.
Section 5 in so far as it imposes a
restriction as to the time for slaughter is again open to the same objection as
has been discussed by us with regard to a similar provision in the Uttar
Pradesh Act. A right of appeal is given to any person aggrieved by the order.
In other words, a member of the public, if he feels aggrieved by the order
granting a certificate for slaughter, may prefer an appeal and hold up for a
long time the slaughter of the animal. We have pointed out that for all
practical purposes such a restriction will really put an end to the trade of
the petitioners and we are unable to accept a restriction of this kind as a
reasonable restriction within the meaning of cl. (6) of Art. 19 of the
Constitution.
Section 6 standing by itself, we think, is
not open to any serious objection. It is ancillary in nature and tries to give
effect to the provision of the Act prohibiting slaughter of cattle in
contravention of the Act.
Section 7 relates to the prohibition of sale,
purchase etc., of cows and calves and inasmuch as a total ban on the slaughter
of cows and calves is valid, no objection can be taken to s. 7 of the Act. It
merely seeks to effectuate the total ban on the slaughter of cows and calves
(both of cows and she-buffaloes). Section 8 is also ancillary in character and
if the other provisions are valid no objection can be taken to the provisions
of s. 8. Sections 10 and 11 impose penale subsidised by the Government out of
public funds; that Part VII of the Act had no application to the present
proceedings, and that, therefore, the notification under s. 6 was not invalid.
The appellants preferred an appeal, under the Letters Patent. The Letters
Patent Bench dismissed the appeal, but for different reasons. After an
examination of the precedents of the different High Courts, bearing on the
controversy in this case, the Bench came to the conclusion, which may better be
expressed in its own words:"There is thus considerable authority for the
464 view advanced by the learned counsel for the appellants that compliance
with the provisions of Part VII is obligatory in the case of all acquisitions
for a company. In the present case the acquisition was undoubtedly for the
benefit of a company. I have given this matter my most anxious consideration,
and, with great respect to the learned Judges, whose decisions have been noted
above, I find myself unable to subscribe to the views expressed by them. It
seems to me that their views were coloured by the background of the provisions
of the Constitution. Article 31 of the Constitution prohibits compulsory
acquisition of property for anything except a public purpose. Therefore,
acquisition for anything which is not a public purpose cannot now be done
compulsorily, but it has never been disputed that before the Constitution came
into force land could have been acquired compulsorily by Government for a
purpose which was not public. There is nothing in the Land Acquisition Act to
warrant the assumption that the embargo placed by Article 31 of the
Constitution found place in the Act. It seems to me that the Land Acquisition
Act contemplates two categories of acquisitions".
After an examination of the provisions of the
Act, the High Court observed that the Land Acquisition Act came into force when
there was no bar to compulsory acquisition for private purposes. Such a bar was
only imposed, for the first time, by Art. 31 of the Constitution. After the
Constitution came into force, Part VII of the Act became redundant or null and
void. But, in its view, the present acquisition proceedings were saved from all
attack based on non-compliance with the provisions of Part VII of the Act. The
reason for this conclusion, according to the High Court, was that as the land
was acquired for a public purpose, there was no need to comply with the
provisions of Part VII, even though the Company is to bear all the expenses for
the acquisition.
It is manifest that the main point for
determination in this appeal is: Whether or not the acquisition proceedings had
been vitiated by reason of the admitted fact that there was no attempt made by
the 465 Government to comply with the requirements of Part VII of the Act. It
is equally clear that the Letters Patent Bench of the High Court was misled in
its conclusions, because all the provisions of Art. 31 of the Constitution had
not been brought to their notice. It is not correct to say that Part VII of the
Act had become redundant or null and void, as suggested by the High Court,
because that Part provided for acquisition for a private purpose. As held by
this Court in a recent decision, in the case of Babu Barkaya Thakur v. The
State of Bombay (1), the Act deals with two kinds of acquisitions: (1) for a
public purpose, at the cost of the Government, and (2) for a purpose akin to
such a purpose, at the cost of a Company, and to the latter class of
acquisition, the provisions of Part VII are attracted. It was further held in
that case that acquisition of a site for building residential houses for
industrial labour was a public purpose, and that the Land Acquisition Act was
immune from attack based on the provisions of Art. 31(2) of the Constitution,
in view of the provisions of cl. 5(a) of that Article, which saved an existing
law of the nature of the Act in question. As will presently appear, the
conclusion of the High Court is entirely correct, but the process of reasoning
by which it has reached that conclusion is erroneous. That process suffers from
the initial error arising from the fact that the provisions of Art. 31(5) of
the Constitution had not been brought to the notice of that Bench. If the Bench
were cognizant of the true legal position that the Land Acquisition Act, in its
entirety, including Part VII dealing with the acquisition of Land for
Companies, was not subject to any attack under Art. 31(2) of the Constitution,
it would not have based that conclusion on that ratio. Otherwise, there would
be no answer to the contention in which the appellants had persisted throughout
the long course of litigation in which they have indulged in their vain effort
to save the land from being used for the public purpose aforesaid. The Letters
Patent Bench has also fallen (1) [1961] 1 S.C.R. 128.
59 466 into another error in assuming that
"the compensation was paid in its entirety by the Company". It is
better to clear the ground by showing that this assumption is not wellfounded
in fact.
In their Writ Petition, as originally filed
in the High Court, it was not categorically stated by the appellants that the
compensation in respect of the land in question was paid, or was to be paid, by
the Company. It may be stated here, by the way, that it is common ground that the
second respondent is a Company within the meaning of the Act, being a
registered society under the Co-operative Societies Act.
It is also common ground that the purpose for
which the land was being acquired was for erecting residential quarters for industrial
labour, which had organised itself into the Cooperative Housing Society, the
second respondent. It was only at a later stage of the proceedings in the High
Court, that is to say, in the replication filed on behalf of the appellants to
the Written Statement filed by the Government, in answer to the appellant's
Writ Petition, that, for the first time, it was alleged by the appellants that
"the entire amount of compensation has been borne by the respondent
society". This allegation has not been either supported or countered by
evidence on either side. But it has been pointed out by the learned single
Judge that it was clear from the Government Housing Scheme that a substantial
amount to be expended on this Scheme comes out of the Revenues, in the form of
subsidies and loans. It was stated at the Bar, with reference to the terms and
conditions of the Government Housing Scheme, that 25% to 50% of the cost of
land and structures to be built upon the land was to be advanced by Government
out of public funds, in the shape of subsidy and loan. It would, thus, appear
that the High Court was not right in the assumption made as aforesaid.
It is clear from the statement of facts on
record that the respondent No. 2 is a 'Company', within the meaning of the Act;
that the land is acquired for the. benefit of the Company, and at its instance,
and that a large proportion of the compensation money was to 467 come out of
public funds, the other portion being supplied by the Company or its members.
There is also no doubt that the structures to be made on the land would benefit
the members of the Co-operative Society. But, the private benefit of a large
number of industrial workers becomes public benefit within the meaning of the
Land Acquisition Act. In this connection, it may be mentioned that s. 17 of the
Act was amended by the Land Acquisition (Punjab Amendment) Act (11 of 1954) in
these terms"17(2)(b). Whenever in the opinion of the Collector it becomes
necessary to acquire the immediate possession of any land for the purpose of
any library or educational institution or for the construction, ex. tension or
improvement of any building or other structure in any village for the common
use of the inhabitants of such village, or any godown for any society
registered under the Co-operative Societies Act, 1912 (II of 1912), or any
dwelling-house for the poor, or the construction of labour colonies under a
Government-sponsored Housing Scheme, or any irrigation tank, irrigation or
drainage channel, or any well, or any public road, 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".
It will appear from the (amended) s.
17(2)(b), quoted above, that the construction of labour colonies, under a
Government-sponsored Housing Scheme, has been included in the category of
'works of public utility'. As already indicated, even apart from the indication
given by the (amended) section 17, quoted above, this Court has held, in the
recent decision (1) that building of residential quarters for industrial labour
is public purpose. Hence, even apart from the amended provisions of s. 17, it
is clear on the authorities that the purpose for which the land was being
acquired was a public purpose.
(1) [1961] 1 S.C.R. 128.
468 Having cleared the ground, it now remains
to consider the terms of s. 6, on which great reliance was placed on behalf of
the appellants. There is no doubt that, as pointed out in the recent decision
of this Court (1), the Act contemplates acquisition for a public purpose and
for a Company, thus conveying the idea that acquisition for a Company is not
for a public purpose. It has been held by this Court, in that decision, that
the purposes of public utility, referred to in ss. 40-41 of the Act, are akin
to public purpose. Hence, acquisition for a public purpose as also acquisitions
for a Company are governed by considerations of public utility. But the
procedure for the two kinds of acquisitions is different, in so far as Part VII
has made substantive provisions for acquisitions of land for Companies. Where
acquisition is made for a public purpose, the cost of acquisition for payment
of compensation has to be paid wholly or partly out of Public Revenues, or some
fund controlled or managed by a local authority. On the other hand, in the case
of an acquisition for a Company, the compensation has to be paid by the
Company. But, in such a case, there has to be an agreement, under s. 41, for
the transfer of the land acquired by the Government to the Company on payment
of the cost of acquisition, as also other matters not material to our present
purpose. The agreement contemplated by s. 41 is to be entered into between the
Company and the Appropriate Government only after the latter is satisfied about
the purpose of the proposed acquisition, and subject to the condition precedent
that the previous consent of the Appropriate Government has been given to the
acquisition. The ` previous consent' itself of the Appropriate Government is
made to depend upon the satisfaction of that Government that the purpose of the
acquisition was as laid down in s. 40. It is, thus, clear that the provisions
of ss. 39-41 lay down conditions precedent to the application of the machinery
of the Land Acquisition Act, if the acquisition is meant for a Company.
Now, s. 6 itself contains the prohibition to
the making of the necessary declaration under that section in these terms(1)
(1961] 1 S.C.R. 128.
469 "Provided that no such declaration
shall be made unless the compensation to be awarded for such property is to be
paid by a Company, or wholly or partly out of public revenues or some fund
controlled or managed by a local authority".
Section 6 is, in terms, made subject to the
provisions of Part VII of the Act. The provisions of Part VII, read with s. 6
of the Act, lead to this result that the declaration for the acquisition for a
Company shall not be made unless the compensation to be awarded for the
property is to be paid by a company. The declaration for the acquisition for a
public purpose, similarly, cannot be made unless the compensation, wholly or
partly, is to be paid out of public funds. Therefore, in the case of an
acquisition for a Company simpliciter, the declaration cannot be made without
satisfying the requirements of Part VII. But, that does not necessarily mean
that an acquisition for a Company for a public purpose cannot be made otherwise
than under the provisions of Part VII, if the cost or a portion of the cost of
the acquisition is to come out of public funds. In other words, the essential
condition for acquisition for a public purpose is that the cost of the acquisition
should be borne, wholly or in part, out of public funds. Hence, an acquisition
for a Company may also be made for a public purpose, within the meaning of the
Act, if a part or the whole of the cost of acquisition is met by public funds.
If, on the other hand, the acquisition for a
Company is to be made at the cost entirely of the Company itself, such an
acquisition comes under the provisions of Part VII. As in the present instance,
it appears that part at any rate of the compensation to be awarded for the
acquisition is to come eventually from out of public revenues, it must be held
that the acquisition is not for a Company simpliciter. It was not, therefore,
necessary to go through the procedure prescribed by Part VII. We, therefore,
agree with the conclusion of the High Court, though not for the same reasons.
The appeal, accordingly, is dismissed with
costs.
Appeal dismissed.
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