The
Govt. of Andhra Pradesh Vs. H.E.H., The Nizam, Hyderabad [1996] INSC 438 (22 March 1996)
Ramaswamy,
K.Ramaswamy, K.G.B. Pattanaik (J) K . Ramaswamy,J.
CITATION:
1996 SCC (3) 282 JT 1996 (3) 629 1996 SCALE (3)140
ACT:
HEAD NOTE:
Leave
granted.
This
appeal by special leave arises from the judgment and decree dated November 11, 1992 made in A.S. No.2470/86 by the High
Court of Andhra Pradesh. Notification under Section 4(1) of the Land
Acquisition Act 1894 (for short, the fact') was published in the State Gazette
on July 27, 1978 for public Purpose, namely, construction of
Residential-cum-Commercial Complex in Saroonnagar, Phase-II in out-skirts of
Hyderabad city by the Hyderabad Urban Development Authority. The total extent
of the land notified for acquisition was 25 acres 12 gunthas. After conducting
enquiry under Section 5A declaration under Section 6 was published on May 3, 1979. The respondent filed Writ Petition No.2510/82 in
the High Court to quash the notification under Section 4(1). A learned single
Judge by Order dated June
30, 1983 directed the
Land Acquisition Officer [LAO] either to pass an award or issue notification
under Section 48 withdrawing the acquisition within a period of six weeks from
that date. In furtherance thereof, the LAO by his award dated August 6, 1983 determined the compensation @ Rs.10,000/-
per acre. On reference under Section 18, the District Judge by his award and
decree dated March 31, 1986 determined the compensation @ Rs.30/- per square
yard. On appeal it was confirmed by the Division Bench of the High Court. Hence
this appeal by special leave.
It may
be relevant to notice at this stage that the lands are within the Hyderabad
Urban Agglomeration covered by Urban Land Ceiling and Regulation Act, 1976 (for
short, the 'Ceiling Act') which came into force on February 17, 1976. The respondent filed the statement under Section 6 thereof
By notification dated November 27, 1982, the competent authority under the
Ceiling Act issued notice under Section 9 of the Act determining excess vacant
land to be acquired by the Government. By further State Gazette notification
dated February 23, 1983 published under Section 10(3) of the Ceiling Act the
competent authority declared the acquired land notified on November 4, 1982 in
the State Gazette under Section 10(1) of the Act as excess land with effect
from the said date to be deemed to have been acquired by and wested in the
State Government and that it stood vested absolutely in it free from all
encumbrances.
Possession
of the acquired land was taken on June 2, 1984 and the compensation of a sum of Rs.8,43,778/- was paid in
Form No.C on June 7,
1984.
The
first contention raised by Shri Sitharamaiah, learned senior counsel for the
appellant is that by operation of Section 3 of the Ceiling Act which came into
force in relation to Andhra Pradesh on February 17, 1976, no person shall be
entitled "to hold" any vacant land in excess of the ceiling limit on
and from that date. Section 4 envisages ceiling limit and every holder of vacant
land in excess of the ceiling limit shall file a statement on or before six
months from February
17, 1976. By conjoint
operation of Section 6, Rule 3 and Form I, holder must specify vacant land
which he desires to retain within the ceiling limit. A draft statement should
be filed before competent authority who, after considering the objections to
the draft statement, makes necessary alteration in the draft statement and
prepares a final statement made under Sections 8 and 9 of the Act giving
particulars of the vacant land in excess of the ceiling limit which should be
published under Section 10 [1] of the Act.. If any person interested in the
vacant land makes claimed under Section 10 [2], the competent authority, after
considering the same will determine the nature and extent of the right. Section
10 [3] requires the competent authority to publish a declaration that the
excess vacant land shall be deemed to have been acquired by the Government with
effect from the date specified therein and that the same shall be deemed to
have been vested in the Government free from all encumbrances.
Under
Section 10 [5], the competent authority may order any person in possession of
the vacant land to surrender or deliver possession of the excess land within
thirty days of service of notice. If he refuses, the competent authority is
empowered under Section 10 [6] to take possession by using such force as may be
necessary . Section 11 envisages payment of compensation for the excess land
deemed to have been acquired. By operation of the declaration under Sections
10(3) and 10(1) referred to hereinbefore, such land, the subject of the
acquisition is deemed to have been vested in the State free from all
encumbrances. The respondent/claimants are entitled only to the payment of
compensation as provided in Section 11 of the Ceiling Act.
The Civil Court, therefore, is devoid of
jurisdiction to determine the compensation under the Act, since the field is
already occupied by the Ceiling Act. Determination of compensation at the
enhanced rate by the Civil
Court, therefore, is
clearly an error apparent on the face of the record. The Government, therefore,
does not have to acquire land since the land already vested in it under Section
10 [3] free from all encumbrances. The vesting shall be deemed to have taken
place from February 17,
1976, the date on
which the Urban Ceiling Act came into force. Sri Sitamaraiah also contended
that the District Court and the High Court committed grave error in determining
the market value @ Rs.35/- per square yard. In Ex.A1 to A4, the market rate of
the lands sold was Rs.6/- per square yard only and the remaining price of
Rs.29/- was for development. The courts below, therefore, were in error in
awarding the compensation @ Rs.30/- per square yard.
Shri
K. Madhava Reddy, learned senior counsel for the respondent, contended that the
appellant having proceeded to acquire the land under the Acts has no power,
unless the acquisition is withdrawn Section 48, to contend that the excess
vacant under the Ceiling Act vests in the Government.
notification
published under Section 6 of the Act is conclusive of the public purpose which
would be crystalized by making an award under Section 11. Compensation having
been determined under Section 11, as directed by the High Court and possession
thereof having been taken, it is no longer open to the appellant to contend
that they are not required to pay compensation under Section 23 of the Act nor
is the respondent entitled to fall back upon Section 11 of the Ceiling Act
which is contrary to the Scheme of the Act.
It
cannot, therefore, be contended that the respondent is entitled to compensation
only under Section 11 of the Ceiling Act. He also contended that the Government
had exempted the lands from the Ceiling Act.Therefore, the High Court was right
in determining the compensation under the Act. He further contended that the
Hyderabad Urban Development Authority [for short, 'HUDA'] itself had sold the
lands in the neighborhood @ Rs.30/- per square yard and, therefore, that would
form basis for determination of the compensation in respect of the acquired
land. The reference Court, therefore, was right in placing reliance on that
piece of evidence.
The
rival contentions give rise to the primary question: whether the excess vacant
land covered by the Ceiling Act stood vested in the State is liable to be
acquired under the Act? It is seen that Section 3 in Chapter III of the Ceiling
Act declares that except as otherwise provided in the Act, on and from the
commencement of the Act [February 17, 1976 in relation to Andhra Pradesh)
"no person shall be entitled to hold any vacant land in excess of the
ceiling limit". The ceiling limit for Hyderabad Urban Agglomeration is
1000 sq. meters prescribed in category 'B' of Schedule I referred in Section 4.
"Hold" means own. This expression connotes two concepts, i.e.,
physical possession or legal title to the vacant lands. Both the concepts stand
attracted to the concept 'hold' under the Ceiling Act. The owner or excess
vacant land in excess of the ceiling limit is required to file a statement
under Section 6 and by operation of Section 3, he ceases to hold the said
vacant land subject to the operation of the provisions of the Ceiling Act.
Section
5 prohibits transfer of vacant land in excess of the ceiling limit at any time
between commencement of the appointed day and the commencement of the Act.
Section 6 enjoins the holder of the vacant land in excess of ceiling limit to
file a statement within the prescribed time in the manner laid under the Act
the rules and in the form prescribed therefor. Section 8 enjoins the competent
authority to prepare a draft statement as regards vacant land held in excess of
the ceiling limit. Section 9 envisages final statement after disposal of
objections, if any, received in that behalf and service of the notice in that
behalf on the person concerned as envisaged therein.
Under
Section 10(1), after service of the statement under Section 9 on the concerned
person, the competent authority should cause publication of a notification in
the State Gazette with particulars of the vacant land in excess of the ceiling
limit, for information of the general public. After considering claims, if any
laid under sub-Section (2) and disposal thereof, the competent authority shall
determine the nature and extent of such claim and pass such orders as it deems
fit. Thereafter the competent authority by notification under Section 10(3)
published in the State Gazette may declare that the excess land published under
sub-Section (1) shall he deemed to have been acquired by the State Government
with effect from the date specified in the declaration and such land shall
"be deemed to have vested absolutely in the State Government free from all
encumbrances with effect from the date so specified". The word "deemed"
is used to give effect to the operation of Section 3 from the date the Act was
brought into force. In other words, the deemed vesting under Section 10(3)
would date back to February
17, 1976 and the date
specified under Section 10 [3]. In Vatticherukuru Village Panchayat vs. Nori Venkatarama Deekshithulu
& Ors. [(1991) Supp. 2 SCC 228 at 239] this Court in para 10 had held that
the word 'vest' takes varied colors from the context and situation in which the
word came to be used in the statute. It is common knowledge that under the Act,
the acquired lands vest in the State from the date of taking possession under
Section 16 of 17 [2]. Under the land reforms like abolition of estate and
taking over thereof the vesting takes effect from the date of publication of
the notification in the official gazette. In Consolidated Coffee Ltd. & Anr.
etc. vs. Coffee Board, Bangalore etc. etc. [1980) 3 SCR 625 at 645] this Court
had held that the word 'deemed' is used a great deal in modern legislation in
different senses and it is not that a deeming provision is every time made for
the purpose of creating a fiction. A deeming provision is made to include what
is obvious or what is uncertain or to impose for the purpose of a statute an
artificial construction of a word or phrase that would not otherwise prevail,
but in each case it would be a question as to with what object the Legislature
has made such a deeming provision. It would thus be seen that determination of
the excess ceiling land pursuant to the statement filed under Section 6 becomes
conclusive by publication of the notification under sub-Section (3) of Section
10 and the excess lands were prohibited to be held under sub-Section 3 on and
from the date of the commencement of the Act. Such excess and shall vest in the
State only from a date specified in the notification. The vesting under Section
10 [3] takes effect from the date of publication of the notification under
sub-Section (3) of Section 10 in the State Gazette with effect from the date
specified therein.
It
would thus be apparent that the State acquired absolute right, title and
interest in the excess urban vacant land in the State from the date of the
publication of the notification under Section 10 [3] of the Ceiling Act and
from February 28, 1983 that date the State Government became absolute owner of
the excess vacant land free from all encumbrances.
The
question, therefore, is: whether it is necessary for the Government to
determine compensation under Section 23 of the Ceiling Act for the land which
already vested in it under the Ceiling Act. In Maharao Sahib Sri Bhim Singhli
etc. etc. vs. Union of India & Ors. etc. etc.
[(1985) Supp.1 SCR 862], where the constitutionality of the Ceiling Act was
questioned, the Constitution Bench had held that the primary object and purpose
of the Ceiling Act is to acquire such land as may be in excess of the ceiling
limit with a view to prevent concentration of urban land in the hands of a few
persons and speculation and profiteering therein and also to bring about an
equitable distribution of land in urban agglomerations to subserve the common
good in furtherance of Article 39(c) and (b) respectively of the Constitution. this
view was reiterated in Union of India vs. Valluri Basavaiah Chaudhary [(1979) 3
SCR 802] and State of Gujarat vs. Parshottamdas Ramdas [(1988) 1
SCR 997]. In Dattatrava Shankarbhat Ambalgi & Ors. vs. State of Maharashtra
& Ors.[AIR 1989 SC 1796], a Bench of two Judges of this Court had held that
the land to the extent which falls within the ceiling area stands as a class
different from the land which is in excess of the ceiling area. It is liable to
be declared surplus to give effect to the purpose and object envisaged under
the Act. The Ceiling Act is a self-contained Code. As far as the acquisition of
surplus of ceiling land and payment of compensation is concerned, it is
governed by the provisions of the Ceiling Act. It was, therefore, held that it
would not be necessary to acquire the land under the Maharashtra Act No.37 of
1966 resulting in misuse of public funds by granting higher compensation, when
the purpose of acquisition could be achieved on payment of lesser amount of
compensation prescribed in Section 11 of the Ceiling Act. In Parshottamdas's
case [supra], the same question had arisen.
Another
Bench of two Judges had held therein at page 1007 that it is open to the State
Government to withdraw from acquisition under the Land Acquisition Act and when
the lands under the Ceiling Act could be acquired by paying compensation as
provided thereunder, it would not be proper to compel the Government to acquire
them under the provisions of the Land Acquisition Act, 1894. As already stated,
the Act has the overriding effect on all other laws". In State of M.P. vs. Surendra Kumar & Anr. [(1995) 2 SCC 627], a
Bench of two Judges [to which one of us, K.Ramaswamy, J., was a member] was to
consider whether it would be open to the Government to purchase the land
pending proceedings under the Ceiling Act and publication of the declaration
under Section 10 [3]. This Court at page 629 in para 3 had held that two
courses were open to the Government in that situation. The Government could
return the application for permission for sale; finalize the process in Chapter Ill or it could purchase the lands. It was held that there was no
prohibition for the State to purchase the property though the declaration was
not finalized.
It
would, thus, be clear that when the vacant land is declared under the Ceiling
Act, it is not necessary for the State to acquire the excess vacant land vested
in it under the Act. But unfortunate to the appellant that benefit of the
declaration was unavailable for the reason that the Government in GOMs
No.1552/MA dated May
20, 1981 had permitted
HUDA to acquire the surplus land under the provisions of the Act. In
consequence, having exempted the excess vacant lands from the purview of the
Ceiling Act, the appellant had denied itself of the benefit of Section 11 of
the Ceiling Act to pay compensation as prescribed thereunder. The result is
that the appellant would determine the compensation under the Land Acquisition
Act.
The
next question is: whether determination of market value at Rs. 30/- per sq. yd.
is valid in law? The District Judge had proceeded on the premise that the HUDA
had acquired adjacent land under the Act and had sold @ Rs.35/- per sq. yd. and
that, therefore, the compensation claimed at Rs.30 per square yard should be
paid to the respondents.
That
found favour with the High Court. It is stated in the evidence adduced on
behalf of the appellant that out of the sale consideration of Rs.35/- per sq.
yd., the cost of the land was Rs.6/- per sq.yd. and Rs. 29/ was collected
towards tentative development charges. They were tentative prices fixed thereunder.
In other words, Rs.29/- was incurred towards developmental charges and Rs.6/-
per sq.yd. was the actual cost. The sales took place in the year 1976. It is
seen that the lands were being used as horse-stable. The respondent claimed
compensation @ Rs.30 per sq. yd. It is seen that the notification under Section
4(1) of the Act was issued on July 27, 1978.
The sales by the HUDA of the plots of the neighboring lands took place in the
year 1976 after full development. The lands required development. It is
well-settled law that deduction of developmental charges varies between 33-1/3%
to 65% depending on facts and circumstances in each case. view of the fact that
we have in evidence tentative developmental charges of Rs.29 per incurred in
1975-76, taking a pragmatic view we that after deducting developmental charges
respondent is entitled to compensation @ Rs.8/- sq.yd. with a statutory rate of
solatium on enhanced compensation @ 30% and 9% interest for one year from the
date of taking possession, i.e., June 2, 1984 and after expiry of one year, @
15% till the date of deposit. The respondent is not entitled to additional
amount under Section 23 [1-A] for the reason that the respondent had filed W.P
No.2510 of 1982 and kept the matter pending till the Amendment Act became
operative. The award could not be made on account of the pending proceedings in
the High Court and the same was made as per the directions of the High Court.
The
appeal is accordingly allowed but, in the circumstances, without costs.
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