Full Judgment Text
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PETITIONER:
STATE OF ASSAM & ORS.
Vs.
RESPONDENT:
BANSHIDHAR SHEWBHAGWAN & CO.
DATE OF JUDGMENT01/09/1981
BENCH:
VARADARAJAN, A. (J)
BENCH:
VARADARAJAN, A. (J)
TULZAPURKAR, V.D.
CITATION:
1981 AIR 1957 1982 SCR (1) 554
1981 SCC (4) 283
ACT:
Lease of Government land-Land leased to respondent-
Respondent developed the land at great expense-Lease not
renewed-Government claimed that land was needed for defence
purposes-Later lease sought to be auctioned-Land required by
Government for same purpose-Action whether mala fide-Auction
whether for a collateral purpose.
HEADNOTE:
On a part of a large area of land acquired by the
Government during World War II an aerodrome was constructed
and on the remaining 300 odd acres which remained unused a
thick jungle grew over the years.
Pursuant to the decision of the Government of India to
lease out the unused portion of the land, the respondent
entered into an agreement with the Government and took
possession of the land after paying one year s rent in
advance.
The respondent alleged that, after taking possession of
the land, he had spent a large sum of money in clearing the
jungle and making it a well managed tea garden. He also
alleged that the concerned Government officials were putting
off execution of the lease deed on some pretext or the
other. Having had no satisfactory reply from the Government,
the respondent moved the Government of India through a
Member of Parliament who was informed that the land was
required for defence purposes and that it would not be
possible to extend the lease. A few months later the Defence
Minister informed the Member of Parliament that the
Government had decided to auction the lease-hold right on an
annual basis in order that possession of the land could be
resumed for defence purposes at short notice. A notice for
public auction was thereafter issued .
The respondent filed a writ petition in the High Court
and obtained an order restraining the appellants from
auctioning the land.
In the meantime the respondent filed title suits
against the Government.
The respondent contended that the auction notice was
malafide because having found that the jungle had been
cleared and the land had been developed into a workable tea
garden, the Government wished to lease the land to the
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highest bidder for getting a large amount of money and that
this was for a collateral purpose.’ The High Court upheld
this contention.
555
Allowing the appeal,
^
HELD: If any authority exercised in bad faith or for
collateral purpose power conferred on it by law such action
would be struck down as an abuse of power and a fraud on the
statute. [559 E-F]
In the present case however there is much evidence on
record to establish that there was no lack of bona fides OD
the part of the Government and that the action sought to be
taken by it was not for a collateral purpose. Had the
attention of the High Court been drawn to the material on
record, there was no possibility of the High Court coming to
the conclusion that it did.
Although in 1962 the Deputy Minister for Defence in the
first instance informed the member of Parliament, who
interceded on behalf of the respondent that the land was
required for defence purposes and for that reason it would
not be possible to extend the then current lease but later
stated that it was decided to lease out the land to the
highest bidder by way of public auction on a yearly basis
and the Deputy Commissioner in the affidavit had stated that
the land was not required for defence purposes until 1964,
the need for defence purposes did arise when the war with
Pakistan broke out in 1965. It could not, therefore, h said
that the Government did not need the land for defence
purposes in 1966 when the order was issued. Defence
requirements depend on many unforeseeable factors. [559 F-H]
That apart, the appellants did state right from the
beginning that the lease was subject to the condition that
whenever the Government needed the land for defence purposes
it would be determined by notice without payment of
compensation and that the Government was not bound to renew
the lease. [560 F-G]
There is, therefore, nothing to support the Finding of
the High Court that the Government had never put forward the
plea that the land would be required for defence purposes at
any stage in the title suits and that it was putting forward
such a case only as a ruse to auction the land for a larger
amount of rent. [561H]
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 321 (N)
of 1970.
From the judgment and order dated the 30th July, 1968
of the Assam & Nagaland High Court at Gauhati in Civil Rule
No. 420 of 1966.
S.K. Nandy and Krishna Prosad for the Appellants.
S.N. Choudhary for the Respondents.
The Judgment of the Court was delivered by
VARADARAJAN, J. This appeal by special leave is by the
respondents in Civil Rule 420 of 1966 against the Judgment
and order dated 30th July, 1968 passed by the Division Bench
of the
556
High Court of Assam and Nagaland, allowing the Writ petition
with no order as to costs. That writ petition was filed
under Art. 226 of the Constitution for quashing the order of
requisition issued by the Deputy Commissioner, Lakhmipur-
Dibrugarh, the second appellant in this appeal and the first
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respondent in the writ petition-under Memo No. LA/27511-15/R
dated 25.10.1966. The Memo was issued in exercise of the
powers conferred by s. 29 (i) of the Defence of India Act,
1962 (51 of 1962) read with the Notification of the
Government of India, Ministry of Home Affairs No.S.O. 1888
dated 10th June, 1965 in respect of the properties described
in the schedule attached thereto viz. Sookerating Tea Estate
and Budla Beta Tea Estates, situate in Dum-Duma, Mauza
Lakhmipur District on the ground that the lands were
necessary for securing the defence of the country and
efficient conduct of military operations.
During the Second World War, in 1940 the Government of
India acquired for defence purposes a part of Sookerating
Tea Estate with its adjoining lands measuring in all 769.20
acres for constructing an air field. The air field was
constructed over an area of 469 acres and on the remaining
300.20 acres there were tea bushes which were growing wild
and overgrown with thick jungles. After the war was over,
the area on which the air field had been constructed viz.
469 acres was transferred to the State Government for its
use. In the writ petition it was stated that area was still
Lying unused. The Government of India wanted to lease out
the said 300.20 acres to some established tea planters with
a view to earn foreign exchange. The respondent, a
registered partnership firm owning the Bagrodia Tea Estate
negotiated with the Estates Military officer, Assam Circle
at Shillong and the Ministry of . Defence, Government of
India and entered into an agreement of lease dated 2.3.1962
in respect of the land on a rent of Rs. 6304.20 per annum
for a term of one year renewable for a period of one year at
a time if the land was not required by the lessor. The
respondent took possession of the land on 10.3.1962 after
paying the annual rent in advance on 2.3.1962. It was
alleged in the writ petition that the respondent thereafter
improved the land at a cost of Rs. 1,75,000/- and made it
into a well managed tea garden. The Military Estates officer
was putting off the execution of the lease deed on some
pretext or the other, though the respondent had deposited
the requisite stamp papers for the execution of the lease
deed. When the respondent approached the Government of India
through a Member of Parliament, the Deputy Minister for
Defence
557
informed the Member of Parliament by his letter dated
20.12.1962 that the land was required for defence purposes
and that it would not be possible to extend the current
lease. Subsequently the Defence Minister informed the Member
of Parliament by his letter dated 1.4.1963 that as several
tea planters have evinced interest in the estate it was
decided to auction the leasehold right in the land on an
annual basis subject to the condition that the land might be
resumed for defence purposes at short notice. No action was
taken on the respondent’s request made on 25 1.1963 for
renewal of the lease. But the Military Estate officer,
Jorhat Circle, the 4th appellant, issued a notice on
20.3.1963 for leasing the land for one year by public
auction. The respondent filed a writ petition in the High
Court and obtained rule nisi as well as an interim order
restraining the appellants from giving effect to the said
notice dated 20.3.1963. The petition filed by the appellants
on 28.5.1963 for restraining the respondent from plucking
tea leaves was rejected. The respondent filed Title Suit No.
30 of 1963 in the Court of the Subordinate Judge, Upper
Assam Districts, Dibrugarh on 18.7.1963 for certain reliefs
including confirmation of possession of the land and
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specific performance of the agreement to lease and obtained
an interim. injunction restraining the appellants from
interfering with the possession of the land. The writ
petition was not pressed in view of the institution of Title
Suit No. 30 of 1963 by the respondent. The respondent filed
Title Suits Nos. 6 of 1964 and 13 of 1965 in the same Court
praying for the same reliefs in respect of the years 1964
and 1965 and obtained temporary injunction. The respondent
filed Title Suit No. 4 of 1966 in the same court for the
same relief. All those suits were pending on the date of
institution of the present writ petition. The respondent
received the impugned order of requisition on 26.10.1966
from the second appellant and Subsequently filed the present
writ petition for the aforesaid reliefs on several grounds.
The appellants in this appeal and other respondents in
the writ petition filed counter affidavits opposing the
petition and contending inter alia that the question of
requisition of the land for defence purposes has been
decided upon by the Government of India and the impugned
order is bonafide and has been made by the competent
authority under the Defence of India Act.
Two contentions were urged before the Division Bench of
the High Court on behalf of the respondent. The first was
that the second appellant, the Deputy Commissioner,
Dibrugarh, who has
558
issued the impugned order has stated in the order that in
his opinion it was necessary to requisition the property,
and it was urged before the learned Judges of the High Court
that the Deputy Commissioner was not competent to form the
opinion.
Section 29 (I) of the Defence of India Act, 1962 (Sl of
1962) reads:
(1) "Notwithstanding anything contained in any
other law for the time being in force, if in the
opinion of the Central Government or the State
Government it is necessary or expedient so to do for
securing the defence of India, civil defence, public
safety, maintenance of public order or efficient
conduct of Military operations, or for maintaining
supplies and services essential to the life of the
Community that Government may by order in writing
requisition any immovable property and may make such
further orders as appear to that Government to be
necessary or expedient in connection with the
requisitioning:
Provided that no property or part thereof which is
exclusively used by the public for religious worship
shall be requisitioned."
Clauses (a), (b) and (c) of Section 40(I) of the
Defence of India Act provide for delegation of the power or
duty under the Act or by any rule made thereunder and read:
Section 40 Power to delegate:
(i) The Central Government may by order, direct
that any power or duty which by this Act or
by any rule made under this Act is conferred
or imposed upon the Central Government shall,
in such circumstances and under such
conditions, if any, as may be specified in
the direction be exercised or discharged
also,
(a) by any officer or authority subordinate
to the Central Government, or
(b) whether or not the power or duty relates
to a matter with respect to which a
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State Legislature has power to make
laws, by any State
559
Government or by any officer or
authority subordinate to such
Government, or
(c) by any other authority."
The opinion that the land is necessary for defence
purposes can be formed in view of s. 40(I) (c) of the
Defcnce of India Act by any authority to whom the power to
requisition under s. 29 (1) of that Act has been delegated
by the Government of India. The Ministry of Home Affairs
had, by Notification No. S.O. 1888 dated 10.6.1965 published
in the Gazette of India (Extraordinary) dated 11.6.1965,
delegated the power conferred by s. 29 of the Act to all
Collectors, District Magistrates, Additional District
Magistrates and Deputy Commissioners in the States and all
Political officers in the North Eastern Front Area. The
learned Judges of the High Court have held that the
Notification is valid and that the delegation can be
unrestricted and found the first contention to be untenable.
No argument was advanced before us by learned counsel for
the respondent in regard to that contention. The first
contention has, therefore, to be held to be untenable.
The second contention urged before the High Court
successfully on behalf of the respondent was that the
impugned order of requisition is malafide. There can be no
doubt that if any authority exercised any power conferred on
him by law in bad faith or for collateral purpose, it is an
abuse of power and a fraud on the statute. In such a case
there can be no difficulty in striking down that act of the
authority by the issue of an appropriate writ under Art. 226
of the Constitution. It is true that the Deputy Minister for
Defence informed the Member of Parliament who appears to
have been pleading for the respondent by his letter dated
20.12.1962 (annexure ’C’ to the writ petition) that the
current lease of the land could not be extended because the
land was required for defence purposes and that in the
subsequent letter dated 1.4.1963 (annexure ’D’ to the writ
petition) the then Minister for Defence had informed the
said Member of Parliament that since several tea planters
have evinced interest in the land it would be in the public
interest to auction the leasehold right only on an yearly
basis subject to the condition that the land can be resumed
at short notice for defence purposes. In his affidavit the
Deputy Commissioner, Lakhimpur, the second appellant has
stated that the land was not required for defence purposes
until 1964 and that the need for defence purposes arose
thereafter and the impugned order was issued.
560
It must be noted in this connection that it was not disputed
before us that the war with Pakistan started in June 1965.
This Court could even take judicial notice of that fact The
impugned requisition order was passed on 25.10.1966.
Therefore, it cannot be stated that there was no need of the
land for defence purposes in October 1966 from the mere fact
that Deputy Minister for Defence had stated in his letter
dated 20 12.1962 referred to above that the current lease
could not be extended because the land was required for
defence purposes and the Minister for Defence had stated in
his letter dated 1.4.1963, referred to above, that as
several tea planters have evinced interest in the land it
would be in the public interest to auction the leasehold
right in the land on a yearly basis alone subject to the
condition that it can be resumed at a short notice for
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defence purposes. That letter of the Minister for Defence
does not altogether rule out the possibility of the land
being required for defence purposes at any time and being
made available for those purposes at short notice. Defence
requirements may change from time to time depending upon
various factors including intelligence reports about the
enemy’s movements and preparations for war. The High Court
has held in favour of the respondent on the question of want
of bonafides on the part of the appellants on the basis that
in the aforesaid title suits filed by the respondent it was
not pleaded by the appellants that the land was required for
defence purposes. The learned Judges of the High Court
appear to have accepted the submission made before them on
behalf of the respondent in this appeal that no such plea
had been raised in the pleadings in the title suits filed by
the respondent. That submission is incorrect, and it is
unfortunate that the attention of the learned Judges had not
been invited to the material on record to ., show that such
a contention was in fact put forward by the 4th appellant in
his pleading in the title suits. In the auction notice
(annexure ’E’) dated 20.3.1963 itself it was stated that the
lease will be subject to the condition that whenever the
Government needs the land for defence purposes it will be
determined by issue of notice giving 30 days time without
payment of any compensation. In the written statement dated
17.7.1965 filed by the 4th appellant in the Title Suit No. 6
of 1965, it was stated in respect of the allegation made in
para 26 of the plaint in that suit that since the land is
required for defence purposes the defendant was not bound to
renew the lease and that even in Title Suit No. 6 of 1964
the defendants have filed written statement contesting the
claim of the respondent/plaintiff. It was also stated in
that written statement in regard to the allegations made in
para 11 of the plaint that the
561
land is required for defence purposes. In regard to the
allegations in paragraph 26 of the plaint it was contended
in the written statement that the land is required for
defence purposes and that any lease under the present
emergency would be detrimental to the interests of the
defence of the country. Even in the counter affidavit dated
17.7.1965 filed in the application for interim injunction
moved in the Title Suit No. 15 of 1965 the 4th appellant had
stated that the land is required for defence purposes, and
there is no question of holding any auction for lease of the
land, that if the order of interim injunction is not vacated
the defence preparation of the country will be hampered as
the land is urgently needed for defence purposes and the
interest of the nation will suffer, that no irreparable loss
or damage which cannot be compensated in money would result
from vacating the injunction and that on the other hand
denying the use of the land for defence purposes at this
critical juncture would cause irreparable loss to the
Government and the nation as a whole. In the written
statement dated 22.6.1965 filed in Title Suit No. 4 of 1966
the 4th appellant had stated with regard to allegations made
in para 11 of the plaint that it is asserted that the land
is bonafide required for defence purposes. Thus it is seen
from the materials on record that at least in Title Suits
Nos. 15 of 1965 and 4 of 1966, the plea that the land was
required urgently for defence purposes was taken by the 4th
appellant who appears to have put forward the defence of the
appellants in this appeal as a whole. The learned judges of
the High Court were, therefore, not right in observing in
their judgment that the intention of the Government is to
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lease the land to the highest bidder in the hope of getting
a large amount of money because the land had been developed
into a working tea garden, that the purpose cannot be said
to be bonafide and that it must be held that the land is
being requisitioned only for collateral purposes. The only
basis for this inference of the learned Judges of the High
Court is the supposed failure of the defendants in the title
suits filed by the respondent to take the plea that the land
is required for defence purposes. That basis being found to
be wrong and unavailable. it is not possible to agree with
the learned Judges of the High Court that the requirement of
the land for defence purposes was not bonafide. The
Government of India whose case the 4th appellant had put
forward in the respondent’s title suits as mentioned above
is the most competent authority to know when the need for
defence purposes will arise or has arisen, and there is no
material on record to hold in this case that the land was
not required on the date of impugned requisition bonafide
for defence purposes and that the appellants were putting
forward such
562
a case in the impugned order only as a ruse to auction the
land for larger amount of rent. Under these circumstances we
find ourselves unable to uphold the judgment of the learned
Judges of the High Court. We accordingly allow the appeal
with costs and dismiss the writ petition.
P.B.R. Appeal allowed.
563