Full Judgment Text
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PETITIONER:
CHANDRA BANSI SINGH AND ORS. ETC.
Vs.
RESPONDENT:
STATE OF BIHAR AND ORS. ETC.
DATE OF JUDGMENT22/08/1984
BENCH:
FAZALALI, SYED MURTAZA
BENCH:
FAZALALI, SYED MURTAZA
VARADARAJAN, A. (J)
MUKHARJI, SABYASACHI (J)
CITATION:
1984 AIR 1767 1985 SCR (1) 579
1984 SCC (4) 316 1984 SCALE (2)235
CITATOR INFO :
RF 1990 SC 334 (32)
ACT:
Constitution of India, 1950-Article 14-Proceedings
under Section 4 of the Land Acquisition Act, 1894 taken. On
19.8.74 seeking to acquire land for Housing Board but on
24.5.80 a small portion of land of a particular influential
family was exempted from the acquisition-Whether the release
of the said land is in violation of Article 14 of the
Constitution and whether the entire acquisition Proceedings
would be vitiated by the said Act of release-Compensation
payable should based, whether at the prevailing market value
on the data of Section 4 Notification or on the date of
actual take over of possession-Supreme Court being a Court
of equity as well, it can award compensation for the delay
in actual turnover.
HEADNOTE:
Respondent State issued a Notification under Section 4
of the Land Acquisition Act, 1894 seeking to acquire 1034.94
acres of land in Village Digha for the purpose of
construction of houses by the Bihar State Housing Board and
the price or compensation for the acquired land was to be
paid by the Housing Board and not by the State from its own
funds. In July 1977, the State Ministry of Revenue and
Industry, after issuing Notifications under Sections 6, 7
and 9 and after considering the claims and objections
confirmed the acquisition. On 24.5.1980 a portion of the
land comprising 4.03 acres belonging to some influential
persons (Pandey families) was released without there being
any legal or constitutional justification for the same. This
release was challenged by way of Writ Petitions in the Bihar
High Court, out of which the Present Civil Appeals and
Special Leave Petitions have arisen and by filling fresh
Writ Petitions in the Court.
Allowing the appeals and the petitions in part, the
Court
^
HELD : 1. The order of release passed by the Government
under Section 48 of the Land Acquisition Act, 1894 was non
est, as being violative of Article 14 of the Constitution.
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The release of land in favour of Pandey families was a pure
and simple act of favouritism without there being any legal
or constitutional justification for the same. [583G-H, 584G]
2. The entire Notification issued under Section 4 on
19th August, 1974 would be deemed to be valid and the land
released to the Pandey
580
families would form part of the acquisition as it did on
19.8.74. The release being separate and subsequent act of
the Collector could not invalidate the entire Notification
but would only invalidate the portion released. Lila Ram
etc. v. Union of India and Ors.[1976] 1 SCR 941
distinguished. [585C-D, E-F]
3: 1 The contention that compensation should be paid
according to the value of land prevailing on the date of
actual take over of possession, since the price of land had
appreciated substantially, is not correct under the law for
two reasons, namely; (i) that it is not the fault of the
Collector for causing the delay in taking over the
possession because the matter was pursued both in the Courts
and before the Government and the proceedings had to be
stayed, as a result of which Collector was prevented from
taking possession or giving his award, although all
proceedings had taken place; and (ii) The landowners being
in continuous possession of the land had enjoyed the
usufruct of the same, particularly the lands happened to be
mostly mango orchards and they must have derived large
benefits by selling them in the market. [586G-H, 587A-B]
3: 2 However, the appellants have undoubtedly a case
for payment of some additional compensation in equity which
relief cannot be denied by the Supreme court which is not
only a Court of law but a Court of equity as well. Apart
from the compensation which may be awarded by the Collector
or enhanced by the Judge or a High Court the appellants
should get an equitable compensation in the form of interest
calculated at the rate of seven and a half percent per annum
for two years on the value of land owned by each land owner.
Thus equitable compensation has been awarded in the special
facts of the case appeal, if any, under the Act on the
amount of compensation payable. [587C-E]
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 9973
to 9977 of 1983
Appeals by Special leave from the Judgment and Order
dated the 31st January, 1983 of the Patna High Court in C.W
J.C. Nos. 2170, 3435, 3879, 3436 and 3561 of 1982.
WITH
Special Leave Petition (Civil) No. 3098 of 1983
From the Judgment and Order dated the 31st January,
1983 of the Patna High Court in C.W.J.C. No. 3556 of 1982.
AND
Special Leave Petition (Civil) No. 4428 of 1983
From the Judgment and Order dated the 31st January,
1983 of the Patna High Court in C.W.J.C. No. 2104 of 1982.
AND
581
Writ Petition (Civil) Nos. 13306-21, 13346 of 1983 and
13229 of 1984 and 1324-42 of 1984.
Under article 32 of the Constitution of India.
ADVOCATES FOR THE APPELLANTS:
R.P. Bhatt and A. K. Srivastava in CA. 9973/83.
A.K. Sen and M. P. Jha in CA No. 9974/83.
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D.P. Singh and B.B. Singh in CA. No. 9975/83.
Y.S. Cihitale, L.R. Singh and Gopal Singh for the
Appellants.
ADVOCATE FOR THE PETITIONER IN SLP NO. 4428 OF 1983.
S.S. Jauhar and S.N. Misra
ADVOCATES FOR RESPONDENTS:
F.S. Nariman, Ram Balak Mahto, Advocate General, B.P.
Singh and Ranjit Kumar in CA. 9973/83.
L. N. Singh, K. P. Verma, Advocate General and Jaya
Narayan
R. P. Singh (In WP. Nos. 13306-21 and 13346)
K.P. Verma, Advocate General and R.P. Singh in SLP. No.
4288 of 1983.
The Judgment of the Court was delivered by
FAZAL ALI, J. Sometimes while taking a pragmatic and
progressive action under a statute in the general public
interest, which is doubtless a step in the right direction,
the Government succumbs to internal or external pressures by
a citizen or group of citizens so as to show special favour
to them which destroys the laudable object of the nature of
the action. Such a course is adopted to help a few chosen
friends at the cost of the people in general and furstrates
the very object of the meaningful State action. Furthermore,
the State action brings it into direct collision with Art.
14 of the Constitution of India.
582
The present case seems to us to be a concrete
illustration of the State action taken under the land
Acquisition Act, 1894 (for short, to be referred to as the
’Act’). What happened here is that while the Government of
Bihar acquired a vast tract of land for construction of
houses and allotment to the people belonging to the low and
middle income groups but chose to exempt certain persons
from the statutory action on purely unreasonable and
illusory grounds. Fortunately, the chosen class comprised a
very small number of persons whose lands consisted of a
small proportion of the total acquired land.
This now brings us to the consideration of the
important facts of the case. A notification under s. 4 of
the Act was issued by the Government of Bihar on 19.8.4
seeking to acquire 1034.94 acres of land in village Digha
for the purpose of construction of houses by the Bihar State
Housing Board wherein it was mentioned that the price or
compensation for the acquired land was to be paid by the
Housing Board and not by the State from its own funds. By
virtue of the said notification objections were called and
on 12.2.76 all the objections were disposed of. A
declaration under s. 6 of the Act was issued which was
published on 20.2.76. On 25.3.76 the publication was
received by the Department and notices were issued under s.
7 of the Act for filing claims. On 14.4.76 notification
under s. 9 of the Act was issued. On 19.5.76 as many as 500
objections were filed. So far so good. Unfortunately,
thereafter on 8.11.76 a representation was made by Mr. Ram
Avtar Shastri, Member of Parliament, for withdrawing the
acquisition proceedings, which was disposed of and dismissed
in December, 1976.
After this, rate report was prepared which was accepted
by the Collector who gave his final estimate and sent the
same to the Government in January, 1977. According to the
estimate, a sum of Rs. 8.30 crores was to be disbursed to
the various owners whose lands were sought to be acquired.
While the matter was nearing completion preparations for the
1977 general elections were made as a result of which the
entire matter was deferred and put into cold storage. On
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24.5.80, which is a crucial date as it appears to be the
subject matter of the present appeals and writ petitions, a
portion of land comprising 4.03 acres belonging to some
influential persons, viz., Badri Sahu, R.S. Pandey and his
relations (hereinafter referred to as ‘Pandey families’) was
released. It is not clear what were the. considerations
which led the Government to single out Pandey
583
families for favourable treatment. Sometime in July, 1977
the State Ministry of Revenue and Industry confirmed the
acquisition. Ultimately, on 12.12.77 in order to smoothen
the way for the acquisition of the lands in question, the
Central Government exempted purely agricultural lands from
acquisition under the Urban Land Ceiling Act.
In the year 1978, a representation was made by Mr.
Thakur Prasad who took over as the new Minister of
Industries after the general elections, about the
acquisition to the Chief Minister who stayed further
proceedings in the matter. In the mean-time, a writ petition
was filed in the High Court which was ultimately withdrawn
by the petitioners and the stay was vacated by the
Government sometime in early 1980. In May, 1981 another writ
petition was filed in the High Court mainly challenging the
release of lands on 24.5.80 in favour of Pandey families on
the ground that the said release was violative of Art. 14
and therefore the entire notification was bad and without
jurisdiction.
In January, 1982, the amount of compensation was
deposited by the State Housing Board with the Treasury which
was followed by an Award given in respect of the acquired
lands on 1.2.83. The totality of the facts and the dates
stated above clearly show that the delay in finalising the
compensation by the Collector was due to unforeseen
circumstances and the appellants, therefore, cannot be heard
to complain of the same because, as already indicated, this
was due to stay orders passed by the Government and the
courts on several representations.
It is rather unfortunate that while the acquisition of
land for a sound purpose was taken and necessary steps
complied with, the acquisition fell into a rough weather
raising serious controversies between the parties in
dispute, putting forward various claims and objections, as a
result of which the said housing scheme was delayed by more
than 5-6 years. Indeed, if the Government would have been
wiser and more alert by the time possession was taken. the
object of building houses by the Housing Board of the State
could have been accomplished long before.
The sheet anchor of the arguments of the appellants in
civil appeal No 9973 of 1983, which is by special leave, was
that the entire acquisition proceedings and the orders
passed by the Collector acquiring the land became non est as
they were violative of Art. 14 of the Constitution. It was
contended that there was no justification for the
584
Government to have released a portion of the land, viz.,
4.03 acres. However small fraction of the main land, it was
merely to favour a particular set of individuals, viz.,
Pandey families, who are alleged to have exercised very
great influence on the Government of the time and that was
done only to help one single body of persons without any
reasonable classification or nexus to the object of the
Notification. The release of land belonging to Pandey
families was supported by the Government on the ground that
as they had put up large buildings with boundary walls in
the entire area covered by 4.03 acres, it would have been
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rather difficult for the Government to demolish the said
constructions thereon. In order to repel this argument,
unimpeachable materials were produce before us to show that
the plea of huge buildings or houses situated on the land of
Pandey families was a complete hoax or a false pretext in
order to enable the Collector to withdraw the acquisition of
this particular land. On examining the materials, which have
not been denied by the Pandey families, we find that the
contentions of the appellants are sound and must prevail. We
have been shown photographs of the lands of Pandey families,
which appear at page 120 of the Paper-book, which shows that
there are no huge buildings or houses but only small
hutments, perhaps used for keeping a tube-well to water the
fields. The plot in question is No. 3114 which belongs to
Pandey families. On page 121 there is another photograph
which shows small hut in the plot owned by the Pandey
families. On the other hand, amongst the lands acquired and
not withdrawn from acquisition is a plot owned by one Deo
Narain Singh, on which stands a two-storeyed structure which
also is meant for the purpose of keeping cattle or watchman
to look after the field. Even so, if the plea of Pandey
families was to be accepted then there was a much superior
claim of Deo Narain Singh for release of his land also.
Neither the photographs referred to above nor the fact
that no structure except the one shown in the photograph
which had been built by the Pandey families, has been
disputed before us. It was, therefore, rightly argued by
counsel for the appellants in Civil Appeal No. 9973/83 that
the release of land in favour of the Pandey families was a
pure and simple act of favouritism without there being any
legal or constitutional justification for the same. The
State also was not in a position either to rebut or support
the release of the lands in question. We might also mention
that although notice had been issued and served on the
Pandey families yet they did not appear in this Court to
support their claim. Hence, there does not appear to be any
serious dispute between the parties that the order of
release
585
passed by the Government under s. 48 of the Act was non est
as being violative of Art. 14 of the Constitution
The matter does not rest here but the counsel for the
appellants further submitted before this Court to declare
the entire acquisition of lands as unconstitutional even
though a very small fraction of it was hit by the mischief
of Art. 14. It was submitted that the entire tract of lands
was acquired by one notification and once it is found that
even an infinitesimal part of it was unconstitutional, the
entire notification would have to be struck down. In case at
the time of acquisition the lands belonging to the Pandey
families were left out on some special grounds in public
interest, then doubtless the appellants’ argument would be
unanswerable. This, however, does not appear to have
happened in this case, as indicated above. Where-as section
4 notification was issued on 19.8.74, the release came on
24.5.80, that is to say about six years after. Hence, all
that would happen is that the release is here by declared to
be bad and non est as a result of which the entire
notification issued under s. 4 on 19.8.74 would be deemed to
be valid and the land released to the Pandey families would
form part of the acquisition as it did on 19.8.74.
Perhaps, the appellants wanted to persuade this Court
to strike down the entire notification so that when a fresh
notification is issued they may be able to get a higher
compensation in view of the sudden spurt and rise in the
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price of land and other commodities in between the period
when the acquisition was made and when the actual possession
was taken. For the reasons that we have given above we are
unable to uphold this process of reasoning. The release
being a separate and subsequent act of the Collector, could
not invalidate the entire notification but would only
invalidate the portion released, with the result that the
original notification would be restored to its position as
it stood on 19.8.74.
Reliance was placed by the counsel for the State on a
decision of this Court in the case of Lila Ram etc. v. Union
of India & ors.,(1) etc. This case is clearly
distinguishable from the present one because the argument in
that case proceeded on the footing that as huge areas of
land had been freezed there was no public purpose in
acquiring the land and hence the acquisition was bad. While
rejecting the contention Khanna, J, speaking for the Court
observed thus:-
586
"It is significant that the land covered by the
notification is not a small plot but a huge area
covering thousands of acres. In such cases it is
difficult to insist upon greater precision for
specifying the public purpose because it is quite
possible that various plots covered by the notification
may have to be utilised for different purposes set out
in the interim General Plan. No objection was also
taken by the appellant before the authorities concerned
that the public purpose mentioned in the notification
was not specific enough and as such he was not able to
file effective objections against the proposed
acquisition."
The case cited above has no application to the facts of
the present case because it was never argued before the High
Court that the acquisition was without any public purpose.
It is, however, contended by both the parties that if at the
time when the section 4 notification was issued an invidious
distinction without any reasonable classification would have
been made between the land acquired and the land of Pandey
families so as to form an integral part of the entire
acquisition, the entire notification would have been struck
down. Here, we find that the release of land in favour of
Pandey families came after three years of the initial
notification and therefore it cannot invalidate the section
4 notification in its entirety. All that would happen is
that the released portion would be deemed to be non est and
in the eye of law the section 4 notification would be deemed
to be a notification for the entire lands acquired,
including the lands of Pandey families.
In view of our decision on the aforesaid points, it is
not necessary for us to dilate further on this question.
The other question raised by the counsel for the
appellants was that there was sufficient delay between the
date of the section 4 notification and taking over
possession of the lands during which period the price of
land had appreciated substantially and, therefore, the
compensation should be paid according to the value of the
land prevailing on the date of actual taking over of
possession. This argument also is without substance for the
following reasons:-
(1): that it is not the fault of the Collector for
causing the delay in taking over the possession
because the matter was pursued both in the courts
and before the Government and the proceedings had
to be stayed, as a result
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587
of which Collector was prevented from taking
possession or giving his award, although all other
proceedings had taken place.
(2): The landowners being in continuous possession of
the land had enjoyed the usufruct of the same,
particularly the lands happened to be mostly mango
orchards and they must have derived large benefits
by selling them in the market.
On an analysis of the various steps taken by the
parties and others in the taking of possession, there is
undoubtedly a delay of about 1/1/2 years and for the purpose
of calculation and convenience when rounded off, the delay
may be taken to be of two years. So far as this delay is
concerned, the appellants have undoubtedly a case for
payment of some additional compensation in equity though not
under law and as this Court is not Only a court of law but a
court of equity as well, it will be impossible for us to
deny this relief to the appellants. After taking into
consideration the various shades and aspects of the case we
are clearly of the opinion that apart from the compensation
which may be awarded by the Collector or enhanced by the
Judge or a higher Court, the appellants should get an
equitable compensation in the form of interest calculated at
the rate of 7/1/2 per cent per annum for two years on the
value of land owned by each landowner. This equitable
compensation has been awarded in the special facts of this
case and will not be the subject matter of appeal, if any,
under the Act on the amount of compensation.
As the points involved in these appeals and writ
petitions are the same we decided to dispose them of by one
common judgment.
For the reasons given above, the appeals the special
leave and the writ petitions are disposed of accordingly but
without any order as to costs.
S.R. Appeals and Petitions partly allowed.
588