Om Parkash & ANR Vs. State of U.P.
& Ors  INSC 242 (14 December 1973)
SARKARIA, RANJIT SINGH SARKARIA, RANJIT SINGH
CITATION: 1974 AIR 1202 1974 SCR (2) 731 1974
SCC (1) 623
CITATOR INFO :
RF 1980 SC1438 (18)
U.P. Nagar Mahapalika Adhiniyam 1959, ss.
365(4), 372(1) and 577 Modifications introduced in ss. 18- and 23 of the Land
Acquisition Act-Validity of-Starting point of the 5-year period mentioned in s.
Under s. 42 of the U.P. Town Improvement Act,
1919, a housing scheme, which included the appellants' property, was published,
and notice under s. 9 of the Land Acquisition Act, 1894, was issued by the
Collector to the appellants.
The 1919-Act. having been repealed by the
U.P. Nagar Mahapalika Adhiniyam, 1959, the Improvement Trust was superseded by
the Mahapalika which took further steps for the implementation of the scheme.
The Collector gave his award, took possession of the appellants' property and
delivered it to the Mahapalika. The appellants did not accept the award and
applied for a reference under s. 18 of the Land Acquisition Act. The matter was
referred to the Tribunal under s. 372 of the Adhiniyam and the Tribunal, under
the proviso to the section, asked the appellants to deposit Rs. 900/- as
security for costs.
In a writ petition in the High Court, the
appellants challenged the constitutionality of certain provisions, whereby ss.
18 and 23 of the Land Acquisition Act were modified. The modifications were (a)
the addition of a proviso to s. 23(2) of the Land Acquisition Act, the effects
of which is that the 15% solatium over the value assessed which is awarded when
land is acquired by the Government under the Land Acquisition Act, will not be
admissible if the land is acquired for the purpose of a scheme under the
Adhiniyam; (b) the addition of a new clause in s. 23, the effect of which is
that the potential value of the land, for example as a building site, is to be
ignored; and (c) the proviso to s. 372(1) of the Adhiniyam (corresponding to s.
18 of the Land Acquisition Act) under which
no claim shall be entertained by the Tribunal unless the claimant has deposited
in Court, a sum not exceeding Rs. 7,000/- as fixed by the Tribunal as security
The High Court dismissed the petition,
Allowing the appeal to this Court,
HELD : Whenever land is compulsorily acquired
for the Mahapalika-be it for the purpose of scheme or for any other purpose-the
acquiring authority is the Government. The fact that where land is acquired for
a Scheme costing less than Rs. 10 lacs, the prior permission of the State is
not, required makes no difference. The caption of para 6 of Schedule IT to the
Adhiniyam with its contents shows that the land has first to be acquired by the
Collector for the Government and thereafter it is transferred to the Mahapalika
by the Government on payment of any further costs. Further, s. 16 of the Land
Acquisition Act, which is not modified by the Adhiniyam, provides that where
the Collector makes his award, he may take possession of the land which
thereupon vests absolutely in the Government. [736D] But the Government can
acquire land either under the unmodified Land Acquisition Act or as modified by
the Adhiniyam. In the first case, the land owner would be entitled to better compensation,
including 15% solatium and the potential value of the land; and there will be
no impediment to approaching the Court under s. 18 of the Land Acquisition Act,
if he is dissatisfied with the Collector's award. In the second case, the
landowner would be under the disabilities envisaged by the modifications
introduced by the Adhiniyam.
732 Therefore, the impugned provisions enable
the- Government to discriminate and could not be justified as reasonable
classification under any of the well-known tests. [736F] Nagpur Improvement
Trust and another v. Vithal Rao and Ors., 1 S.C.C. 500. followed.
But the proviso added to s. 23(2) was deleted
by the U.P.
Amendment Act 23 of 1961. Since the question
of compensation to the appellants is not past and closed, but pending before
the Tribunal, the Tribunal will have to take cognizance of the, repeal and
proceed as if the proviso never existed. The repeal is final and unconditional
and there is nothing in the repealing Act which saves pending reference from its
operation. The effect of the repeal is to remove the disability to receiving
the 15% solatium; but the other two disabilities still subsist. [737H-738B] (2)
Section 365(4) of the Adhiniyam peremptorily requires a scheme to completed
upto the date of the award within a period of 5 years. The words "in so
far as it is not inconsistent with the Provisions, of this Act" in s.
577(a) of the Adhiniyam show that s. 365(4) applies to the scheme in the
instant case, Otherwise, it would lead to the result that fresh schemes under
the Adhiniyam must be completed with the time-limit, while older schemes under
the repealed Act could be left pending indefinitely.
It could not however be contended by the
appellants that the scheme in the instant case was not so completed within the
requisite time and that there-fore it has come to an end.
[739G] Reading cl. (a) of s. 577 along with
cls. (b) and (c) and giving it a reasonable meaning with the aid of the legal
fiction implicit in those clauses, the scheme in the instant case, though
notified under s. 42 of the repealed Act, would in view of the deeming
provision in s. 577(b) be deemed to have been notified under the Adhiniyam, on
the date on which the Adhiniyam came into force; and the 5-year period
specified in s. 565(4) would commence from that date. The Collector's award
being within 5 years from that date must deemed to be within the prescribed
time limit. [739H]
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 2413 of 1968.
From the judgment and decree dated the 19th March
1968 of Allahabad High Court in Writ Petition No. 4473 of 1964.
S. K. Mehta, K. R. Nagaraja and M.
Qamaruddin, for the appellants.
G. N. Dikshit, Ravinder Bana and O. P. Rana,
for respondent No. 1.
V. N. Ganpule and P. C. Kapur, for respondent
The Judgment of the Court was delivered by
SARKARIA, J.-This appeal by certificate against the judgment, dated March 19,
1968 of the Allahabad High Court raises questions about the constitutionality
of certain modifications made in the Indian Land Acquisition Act, 1894 by the
U. P. Nagar Mahapalika Adhiniyam, 1959 and the effect of the repeal of the U.P.
Town Improvement Act, 1919 on the Mumfordganj Housing Scheme which had been
notified, under the repealed Act.
Under s. 42 of the U. P. Town Improvement Act
(Act 8 of 1919), a scheme known as Mumfordganj Housing Scheme was published on
733 behalf of the Improvement Trust, Allahabad in the U. P.
Government Gazette, dated June 17, 1944.
Appellants' property known as Hanuman Bagh, bearing Municipal No. 25/13, Katra
Road, Allahabad, was also included in the area covered by this scheme.
On September 6, 1955, notice under s. 9 of
the Land Acquisition Act, 1894, was issued by the Collector to the appellants.
Even before the appellants had filed their claim, and before the Collector
could make his award under s. 11 of the Land Acquisition Act, 1894, U.P. Town
Improvement Trust Act (No. 8 of 1918) was repealed and replaced by U.P . Nagar
Mahapalika Adhiniyam, 1959 (for short, the Adhiniyam) which came into force on
February 1, 1960. As a result of this change in law, the Town Improvement Trust
was superseded by the Nagar Mahapalika, Allahabad, which took further steps for
implementation of the scheme in accordance with the provisions of the
Appellants filed their claim to compensation
before the Collector who gave his award on April 13, 1961. Possession of the
disputed property was taken and delivered by the Collector to the Mahapalika on
November 16, 1961.
Appellants did not accept the award, and on
their application a reference under s.18 of the Land Acquisition Act, was made
by the Collector to the Court on January 3, 1962. The Court directed the
appellants to deposit Rs.
15001- as security for costs. The time for
depositing security was repeatedly extended and the appellants deposi- ted the
security in installments. Subsequently, the Court returned the reference to the
Collector and refunded the security, for the reason that the reference was
addressed to the District Judge and not to the Tribunal. The Collector, again
made the reference to the Tribunal, which, purporting to act under s.372,
Proviso, asked the appellants to deposit Rs. 900/-. as security for costs.
During the pendency of the reference in the
District Court, the appellants filed writ petition No. 4473 of 1964 under
Article 226 of the Constitution in the High Court of Allahabad, challenging the
constitutionality of the provisions of ss.372, 376 and Schedule 11 of the
Adhiniyam whereby S. 23 of the Land Acquisition Act, 1894 had been modified, on
the ground that those modifications were violative of Article 14 of the
Constitution. They also assailed the validity of the scheme on the ground that
it had not been completed within the time-limit specified in s.365 (4) of the
Adhiniyam. The writ petition was opposed by the State Government and the
Mahapalika (Respondents 1 and 2 respectively).
The Division Bench of the High Court
negatived all the contentions canvassed before it and dismissed the petition
with costs. The Bench, however, granted a certificate of fitness of appeal to
this Court 'Under Article 133(1)(a) of the Constitution. That is how this
appeal has come before us.
734 Section 376 of the Adhiniyam provides
"For the purpose of the acquisition of land for the Mahapalika under the
Land Acquisition Act,' 1894-whether under this Chapter or any other Chapter of
this Act- (a) the said Act shall be subject to the modifications specified in
the Schedule to this Act;
(b) The modifications of the Land Acquisition
Act, the validity of which is in question are (i) The Proviso added (vide para
10 of Schedule 11) to s.23(2) of the Land Acquisition Act, namely :
Provided that this sub-section shall not
apply to any land acquired under Chapter XIV of the Uttar Pradesh Nagar
Mahapalika Adhiniyam, 1959, except- (a) land acquired under sub-section (4) of
s. 348 of that Adhiniyam, and (b) buildings in the actual occupation of the
owner or occupied free of rent by a relative of the owner, and land appurtenant
thereto, and (c) gardens not let to tenants but used by the owners as a place
of resort." The effect of the addition of this Proviso to s. 23 (2) of the
Land Acquisition Act is that 15% solatium over the value assessed which is
awarded when land is compulsorily acquired by the Government under the Land Acquisition
Act, will not be admissible if land is so acquired for the purpose of a scheme
under Chapter XIV of the Adhiniyam.
(ii) The new clause added vide para 10(3) of
Schedule 11) at the end of s. 23, Land Acquisition Act, namely "(2) for
the purpose of clause first.-of sub- section (1) of this section- (a) the
market-value of the land shall be the market value according to the use to
which the land was put at the date with reference to which the market-value is
to be determined under that clause.........
(b) to (g) The effect of this modification is
that the potential value of the land e.g. as a building site, is to be ignored,
735 (iii) s. 372(1) provides that "the Tribunal constituted under the
Adhiniyam shall perform.
the functions of the Court with reference to
all acquisition of land for the Mahapalika for the purposes of this Act under
the Land acquisition Act, 1894".
'The validity of the Proviso to this sub-
section is in question. The Proviso reads :
"Provided that no such claim shall be
entertained by the Tribunal, unless the claimant has deposited in Court such
sum, not exceeding Rs. 7,000/- as the Tribunal may fix, as security, for the
costs, which in the event of the claimants' failure way be awarded against
him." Mr. Mehta, learned Counsel for the appellant, contends that the
modifications (i), (ii) and (iii) are covered and hit by th e ratio of this
Court's decision in Nagpur Improvement Trust and another V. Vithal Rao and
ors.(1) On the other hand, M/s. Dikshit and Ganpule, learned Counsel appearing
for the State and the Mahapalika, respectively have tried to distinguish Nagpur
Improvement Trust's case on the ground that under the Nagpur Improvement Trust
Act, compulsory acquisition of land for all purposes of the Trust had to be,
made by the Government, whereas under the Adainiyam the Mahapalika has plenary
powers to acquire land for the purpose of a scheme under Chapter XIV of the
Adhiniyam. Stress has been laid on the fact that no prior permission of the
State Government is required for the issue of notifications under s. 357 and
363 of the Adhiniyam for compulsory acquisition of land for a Scheme costing
less than ten lakhs farmed under Chapter-XIV of the Adhiniyam.
Further acquisition proceedings-it is
argued-for determina- tion of compensation are taken by the Collector, only as
an agent of the Mahapalika because after making the award, the Collector is
bound under s. 17-A (added by para 6 in Schedule 11) to the Land Acquisition
Act) to make over the land acquired to the Mahapalika. It is further conceded
that the modifications to the Land Acquisition Act in question in the Nagpur
Improvement Trust case (supra) were identical with the modifications (i) and
(ii) above, made by s. 376 read with Schedule 11 of the Adhiniyam.
Thus the first question for decision is ; who
is the acquiring authority if the land is compulsorily acquired for the purpose
of a Scheme under Chapter XIV or for any other purpose of the Mahapalika under
s. 130 of the Adhiniyam? The, answer must be obviously be that in either case
it is the State Government who acquires the land. The mere fact that where the
land is to be compulsorily acquired for a Scheme costing less than Rupees 10/-
lakhs under Chapter XIV, no prior permission of the .State is required for
issuing the necessary notifications under ss. 357 and 363 of the Adhiniyam
(which take the place of notifications under 'S. 4 and 6 of the Land
Acquisition Act), does not mean that in such (1)  SCC 500.
L748Sup.CI/74 736 cases, acquiring authority
is the Mahapalika and not the State GOVernment. The matter has been put beyond
doubt by para 6 of Schedule II, which reads :
6. Transfer of Land to Mahapalika-After
section 17 of the Land Acquisition Act, the following shall be deemed to be
inserted, namely :
17-A. In every case referred to in section 16
or section 17, the Collector shall, upon payment of the cost of acquisition,
made over charge of the land to the Mukhaya Napr Adhikari; and the land shall
thereupon vest in the Mahapalika, subject to the liability of the Mahapalika to
pay any further costs which may be incurred on account of its
acquisition." The caption of this para read along with its contents shows
that the land has first to be acquired by the Collector for the Government and
thereafter it is transferred by the Government to the Mahapalika, only on
payment of its costs.
In this connection it is important to recall
the provisions of s. 16 of the Land Acquisition Act, 1894, which has not in any
way been modified by the Adhiniyam. According to s. 16 "when the Collector
has made his award under s. 11, he may take possession of the land which shall
thereupon vest absolutely in the Government free from all encumbrances."
Thus, it is clear beyond all manner of doubt that whenever land is to be
compulsorily acquired for the Mahapalika-be it for a purpose of the Scheme
under chapter XIV or for any other purpose under s. 130-the acquiring authority
is the Government. There is no material difference between the impugn
provisions of the Adhiniyam and those which were in question before this Court
in Nagpur Improvement Trust's case (supra). The ratio of the aforesaid case
therefore will apply fully to the impugned provisions mentioned at (i), (ii)
There can be no dispute that the Government
can acquire land for a public purpose including that of the Mahapalika: or
other local body, either under the unmodified Land Acquisition Act , 1894, or
under that Act as modified by the Adhiniyam. If it chooses the first course,
then the land- owners concerned will be entitled to better compensation,
including 15% solatium; the potential value of the land etc;
nor will there be any impediment or
burdle-such as that enacted by s.372(1) of the Adhiniyam-in the, way of such
land-owners, dissatisfied by the Collector's award, to approach the Court under
s.18 of that Act. If the Government, for the same purpose, resorts to the Land
Acquisition Act as modified by the Adhiniyam, the land- owner(s) concerned will
suffer from all the disabilities or restrictions envisaged by the modifications.
In this way, the impugned legislation enables the Government to discriminate in
the matter of acquiring land between similarly situated land-owners.
The impugned modifications do not satisfy the
well known tests of reasonable classification which is permissible for the
purpose of legislation. It is not founded on any intelligible differentia, nor
has this differentia a rational nexus with the object sought to be achieved,
namely, 737 compulsory acquisition of land for a public purpose. it is not
necessary to dilate further on this point as this matter stands concluded by
this Court's decision in Nagpur Improvement Trust's case by the ratio of which
we are bound.
It will be sufficient to close, the
discussion by extracting here what Sikri C.J. speaking for the Court in Nagpur
Improvement Trust's case said:
"Can the Legislature say that for a
hospital land will be acquired at 50% of the market value, for a school at 60%
of the value and for a Government building at 70% of the market value ? All
three objects are public purposes and as far as the owner is concerned it does
not matter to him whether it is one public purpose or the other. Article 14
confers an individual right and in order to justify a classification there
should be something which justifies a different treatment to this individual
right. It seems to us that ordinarily a classification based on the public
purpose is not permissible under Article 14 for the purpose of determining
compensation. The position is different when the owner of the land himself is
the recipient of benefits from an improvement scheme, and the benefit to him is
taken into consideration in fixing compensation. Can classifications be made on
the basis of authority acquiring the land ? In other words can different
principles of compensation be laid if the land is acquired for or by an
Improvement Trust or Municipal Corporation or the Government ? It seems to us
that the answer is in the negative because as far as the owner is concerned it
does not matter to him whether the land is acquired by one authority or the
It is equally immaterial whether it is one
Acquisition Act or another Acquisition Act under which the land is acquired. If
the existence of two Acts could enable the State to give one owner different
treatment from another equally situated the owner who is discriminated against,
can claim the protection of Article 14." It may, however, be noted that
the impugned modification (iii) that is, the Proviso added to s. 23 (2) was
deleted by the U.P. Amendment Act 23 of 1961 which came into force on September
Mr. Mehta contends that since the Collector's
award, in the present case, was made when this Proviso was in force, the
appellants will continue to suffer under the liability that had arisen under
the Proviso despite its deletion, even in proceedings before the Tribunal.
On the other.hand, learned Counsel for the
respondents maintain that the effect of the repeal of this Proviso is to
obliterate it altogether as if it never had existed.
To us, the apprehension expressed by Mr.
Mehta appears to be unfounded.
The Proviso in question created only a
disability. The effect of' the repeal is to remove that disability or
restriction on the landowners' right to receive 15 per cent solatium under s.
23 (2) of the Land Acquisition Act.
Further, the assessment of compensation is
not a 738 matter past and closed. It is still pending in 'reference before the
Tribunal. The repeal is final and conditional.
There is nothing in the repealing Act which
saves such pending references from its operation. The Tribunal, therefore, will
have to take cognizance of the repeal and for the purpose of disposing of the
reference, treat the Proviso as having never existed. Thus, the validity or
otherwise of modification (i) has become, more or less, academic.
The last contention of Mr. Mehta is that by
virtue of s. 577 of the Adhiniyam, the provisions of s. 365(4) which
Peremptorily requires a Scheme to be completed up to the date of the award,
within a period of five years, had become applicable to the Mumfordganj Housing
Scheme, also. Since this Scheme-proceeds the argument has not been completed
within the requisite time-limit it has come to an end by operation of law, with
consequent release of the appellants' property.
Mr. Dikshit contends that S. 365(4) cannot
apply, to this Scheme, because the U.P. Town Improvement Act, 1919 under which
it was initiated had no such provision. The point pressed into argument is that
so long as this Scheme is not superseded by any notification or order tinder
clause (a) to s. 577, it will continue to be in force without any time limit.
Mr. Ganpule, appearing for the Mahapalika,
has, in the alternative chosen to steer a middle course. His stand is that even
if s. 365(4), applies to this Scheme, then also the time limit of five years
will start running from the date of the commencement of the Adhiniyam i.e.
February 1, 1960.
In order to appreciate the contentions
canvassed, it will be profitable to set out the material parts of s. 365(4) and
577, as they stood at the relevant time
hereunder "365(1) (2) (3) (4) All acquisition of land and interest in land
for an improvement scheme authorised under this Chapter shall be completed at
least upto the stage of making of awards within a period of five years from the
date of the notification of the scheme under section 363 and any land in
respect of which the acquisition is not so Completed and the owner and occupier
thereof shall cease to be subject to any liabilities under this Chapter
Provided that the State Government may in any particular case before the expiry
of such period and for reasons to be recorded in writing extend the period by
739 Section 577 " Continuation of
appointments, taxes, budget, estimate, .assessment etc.-Save as expressly
provided by the provisions of this Chapter or by a notification issued under
sec- tion 579- (a) any appointment, delegation, notification, notice, tax,
order, direction, scheme, licence, permission, registration, rule, bye-law,
regulation form made, issued, imposed or granted under as it is not
inconsistent with the provisions of this Act continue in force until it is
superseded by any appointment, delegation, notification, notice, tax, order,
direction, scheme, licence, permission, registration, rule, bye- law, or form
made, issued, imposed or granted under this Act or any other law as aforesaid,
as the case may be;
(b) any notice or notification or sanction of
any improvement scheme for the area included in the City issued under the U.P.
Town Improvement Act, 1919 .... .... shall be
deemed to have been issued under this Act, and all further proceedings in
furtherance of such scheme may be taken accordingly- (c) all proceedings for
acquisition of land whether in pursuance of any scheme of improvement or
otherwise initiated under the U.P. Town Improvement Act, 19 19 may be continued
as if they had been initiated under this Act;
(d) to (g) The interpretation suggested by
Mr. Dikshit is possible, only if ,,we read clause (a) of s. 577 in isolation
and do not give full effect -to the words "in so far as it is not
inconsistent with the provisions of this Act" occurring in that clause.
Such an interpret. we think, .With respect, will lead to manifest contradiction
and absurdity. It will mean.that while fresh Schemes initiated under the
Adhiniyam must be completed with speed within the, prescribed time- limit, far
older schemes commenced under the repealed Act,- where the need ,.for
expeditious disposal is the greatest- can continue indefinitely for ,any length
of time. This whimsical construction can be avoided if ,,we read clause (a)
along with clauses (b) and (c) of the same section, ;and give it a reasonable
meaning with the aid of the legal fiction implicit in those clauses. Thus
construed, the Scheme in the instant case, though notified under s. 42 of the
repealed Act in 1944, would, in view of the deeming provision in clause (b) of
s.. 577, be deemed to have been notified under s. 363 of the Adhiniyam, on the
date on which the Adhiniyam came into force i.e. on February 1, 1960. The five-year period specified in s. 365 (4) therefore, will be deemed to 740 have
commenced from February 1, 1960. The Collector had made his award on April 13, 1961, much within the time-limit prescribed by s. 365(4).
In the-above view of the matter, we, negative
the contention of, Mr. Mehta.
For the foregoing reasons, we hold that the
impugned modifications (i), (ii) and (iii) suffer from the vice of
discrimination and as such, contravene the guarantee of equal protection of
laws enshrined in Article 14 of the Constitution.
In the result, we partly allow this appeal
and quash the impugned modifications of the Land-Acquisition Act, 1894.
The appellant shall .be entitled to
proportionate, costs from the respondents. The case being very old the Tribunal
shall do well to dispose of the reference pending before it, with utmost
V.P.S. Appeal partly allowed.