Full Judgment Text
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PETITIONER:
RAM NATH & ORS.
Vs.
RESPONDENT:
UNION OF INDIA
DATE OF JUDGMENT25/04/1984
BENCH:
DESAI, D.A.
BENCH:
DESAI, D.A.
SEN, AMARENDRA NATH (J)
MISRA, R.B. (J)
CITATION:
1984 AIR 1178 1984 SCR (3) 572
1984 SCALE (1)644
ACT:
Constitution of India-Art. 31-B-Scope of-Whether
protection under Art. 31-B to Acts inserted in the Ninth
Schedule against violation of fundamental rights In Part III
of the Constitution extends against violation of rights
under s. 299 of the Government of India Act 1935-Held yes.
Resettlement of-Displaced Persons (Land Acquisition)
Act; 1948-Two provisions to sub-cl.(e) of sub-s. (l) of s.
7-Validity of-Held valid.
HEADNOTE:
S.7 of the Resettlement of Displaced Persons (Land
Acquisition) Act, 1948 broadly provided for payment of
compensation for the land to be acquired for carrying out
the purposes of the Act and the manner and method of
computation of compensation. Sub-clause (a) of sub-s (1)
provided for determining the compensation having due regard
to the provisions of sub-section (1) of Sec. 23 of the Land
Acquisition Act, 1894, that is the market price of the land
on the date of acquisition. The two provisos carved out an
exception. The first part of the first proviso was in
consonance with ss. 4 and 6 of the Land Acquisition Act
namely that the market value shall be determined as on the
date of the publication of the notice under section 3.
Notice under section 3 served the purpose of a notification
under s. 4 of the Land Acquisition Act. It is the second
part of the first proviso that really affected the
compensation, when it said that either the market value
referred to in the first clause of Sub-s. (1) of s. 23 of
the said Act shall be deemed to be the market value of such
land on the date of publication of the notice under s. 3 or
market value of the land on the Ist day of September, 1939,
with an addition of 40% whichever was less. The second
proviso catered to the situation where land acquired had
been held by the owner thereof under a purchase made before
the Ist day of April, 1984 but after the Ist day of
September, 1939.
2. These plots of land situated in Delhi and possessed
by the two appellants were acquired by the respondent in
1950 under the Resettlement of Displaced Persons (Land
Acquisition) Act, 1948. An arbitrator was appointed as
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envisaged by s. 7(1) (b) of the Act to assess the
compensation. The appellants and the Union of India appeared
before the arbitrator and the compensation was determined by
the arbitrator. The appellants perferred two separate
appeals against the award of the arbitrator in the High
Court. A Division Bench of the High Court following a
decision of the Full Bench of the High Court dismissed the
appeals, but granted a certificate under Art. 133(1) (c). In
these appeals the appellants contended that the two provisos
to sub-clause (e) of sub-s.(1) of s.7 of the Act were
violative of
573
s.299(2) of the Government of India Act, 1935 which
guaranteed a fair compensation for deprivation and/or
acquisition of property.
Dismissing the appeals,
^
HELD: 1. The two provisoes to sub-clause (e) of sub-
s.(1) of s. 7 of the Resettlement of Displaced Persons (Land
Acquisition) Act 1948, are valid. [581 D]
2. The contention that reducing the compensation to the
market value plus 40% as on Ist day of September, 1939 is
thoroughly irrelevant to the payment of compensation and
arbitrarily selects the date much earlier to the date of
acquisition and ignores the escalation of price of the land
is without much force. The choice of the date September Ist,
1939 does not appear to be arbitrary but has a real nexus to
the object sought to be as the 1984 Act. The choice of the
date as Ist September 1939 is very relevant and cannot be
struck down as arbitrary because one cannot overlook the
historical fact that the Second World War was declared on
September 2, 1939 and India was dragged into it by a foreign
power on September 3, 1939 and the war situation contributed
to the escalation in price of the land. It is however not
necessary to examine in depth this aspect. [577E-G]
3. Article 31-B of the Constitution which was added by
the Constitution (First Amendment) Act, 1951 provides that
once an Act is placed in the Ninth Schedule to the
Constitution either the Act or any provision thereof shall
not be deemed to be void or ever to have become void on the
ground that such Act or any provision thereof is
inconsistent with, or takes away or abridges any of the
rights conferred by any provision of part III of the
Constitution. The protection under Article 31-B against the
violation of the fundamental rights mentioned in Part III
must extend to the rights under section 299 of the
Government of India Act, 1935 also which has been repealed,
s. 299(2) was in substance a fundamental right which was
lifted bodily as it was from the Government of India Act,
1935 and put into Part III of the Constitution. The Re-
settlement of Displaced Persons (Land Acquisition) Act, 1948
is admittedly inserted in the Ninth Schedule by the
Constitution (First Amendment) Act, 1951. Therefore this Act
ecjoys the umbrella of protection of Article 31-B and is
immuned from the challenge of being violative of any of the
rights under s. 299 of the Government of India Act, 1935 or
fundamental rights in Part III of the Constitution. [577G-H;
578A; C-D ;G-H]
Union of India v. Smt. Mohinder Kaur, ILR 1969 Delhi
1154, upheld.
Dhirubha Devisingh Gohil v. State of Bombay, [1955] SCR
691; State of Uttar Pradesh and Others v. H.H.Maharaja
Brijendre Singh, [1961] 1 SCR 362; N.B. Jeejeebhoy v.
Assistant Collector, Thana Prant, Thana, [1965] 1 SCR 636;
Rustom Cavasjee Cooper v. Union of India, [1970] 3 SCR 530;
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State of Gujarat v. Shantilal Mangaldas and Others [1969] 3
SCR 541, referred to.
574
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeals Nos. 922-
23 of 1971.
Appeals from the Judgment and Order dated the 16th
December, 1969 of the Delhi High Court in F.A.O. No. 94-D/59
& 46-D/1960.
K.C. Dua for the Appellant.
M.S. Gujaral and R.N. Poddar for the Respondent.
The Judgment of the Court was delivered by
DESAI, J. A hangover of the hey day of Article 31
permeates the controversy in these two appeals. The attempt
is to salvage something from the debris of repealed Art. 31
by the Constitution (Forty-fourth Amendment) Act, 1978.
In Re Civil Appeal No. 922/71 : Ramnath, the appellant,
who is now dead took on lease a plot of land bearing No. 64
Block L, Daryaganj, Delhi admeasuring 590 sq. yards from
Delhi Improvement Trust under Exh. A-4 dated February 10,
1942. The period reserved under lease was 90 years. The
appellant paid Rs. 10,253 as initial premium and had to pay
recurring half-yearly rent in the amount of Rs. 102-8-6
under the agreed terms and conditions of the lease. On
payment of Rs. 10,253, the initial payment, the appellant
was put in possession.
In Re Civil Appeal No. 923/71 : Appellant R.S. Ram
Pershad since deceased took on lease two plots of land
bearing No. 66-67 in Block L, Daryaganj, Delhi from the
Delhi Improvement Trust. The appellant executed a registered
lease deed dated March 9, 1943 in respect of Plot No. 66 and
with respect to Plot No. 67, the transaction was through an
oral sale dated May 1, 1942. Each plot admeasured 590.1 sq.
yards. The appellant was put in possession of both the
plots.
The Chief Commissioner of Delhi issued the notification
No. F. 6(3) 50 R & R dated December 15, 1950 under Section 3
of the Resettlement of Displaced Persons (Land Acquisition)
Act, 1948 (’1948 Act’ for short) for acquiring the plots of
both the appellants. An arbitrator was appointed as
envisaged by Section 7(1)(b) of the 1948 Act to assess the
compensation. Both the appellants and the Union of India
appeared before the arbitrator and the compensation was
determined by the arbitrator.
575
Boot the appellants preferred two separate appeals
against the award of the arbitrator in the then High Court
of Punjab at Delhi. On the formation of the High Court of
Delhi both the appeals came up before the Division Bench on
two different dates. The Division Bench following the
decision of the Full Bench in the Union of India v. Smt.
Mohinder Kaur(1) dismissed the appeals but granted a
certificate under Art. 133(1)(c) of the Constitution. Hence
both these appeals by certificate.
The only contention canvassed before the High Court was
that Ist and 2nd proviso to sub-clause (e) of sub-section 1
of Section 7 of the 1948 Act are violative of Sec. 299(2) of
the Government of India Act, 1935 as it then stood and the
compensation awarded by the arbitrator in consonance with
the provisoes is illusory and therefore both the provisoes
are constitutionally invalid. A Full Bench of the High Court
in the decision hereinabove noticed negatived this
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contention but granted the certificate under Act. 133(1)(c)
on the ground that the decision in Union of India v. Smt.
Mohinder Kaur was pending in appeal before the Supreme Court
and as the High Court in rejecting the appeals of the
presents appellants followed the same decision, it was
imperative that the certificate should be granted.
When the appeals came up for hearing, we enquired from
Mr. K.C. Dua, learned counsel for the appellants as to what
happened to the appeal preferred in Smt. Mohinder Kaur’s
case which enabled the appellants to obtain the requisite
certificate under Art. 133(1)(c). There was no clear or
straight answer to the query and it appears that there was
no such appeal and therefore on this short ground the
certificate could have been cancelled. But as even the other
side was not in a position to shed light on the question
whether any appeal at all was preferred against the decision
of the High Court in Smt. Mohinder Kaur’s case and if so
what fate it met, we persuaded ourselves not to cancel the
certificate.
Mr. K.C. Dua, learned counsel, who appeared for the
appellants in both the appeals, was rather on uncertain
ground when he first stated that he does not wish to
challenge the constitution validity of Section 7 and or the
provisoes to sec. 7(1)(e) and then later on stated that he
does challenge the two provisoes to sub-clause (e) of sub-
sec. (1) of sec. 7 on the ground that these two pro-
576
visoes are violative of Section 299(2) of the Government of
India Act, 1935.
Sec. 7(1)(e) and the two provisoes read as under :
"7.(1) Where any land has been acquired under this
Act there shall be paid compensation, the amount of
which shall be paid compensation, the amount of which
shall be determined in the manner and in accordance
with the principles hereinafter set out, that is to
say,-
xx xx xx
xx xx xx
(e) the arbitrator, in making his award, shall have
due regard to the provisions of sub-section (1) of
section 23 of the Land Acquisition Act, 1894 (I of
1894);
Provided that the market-value referred to in
clause first of subsection (1) of section 23 of the
said Act shall be deemed to be the market-value of such
land on the date of publication of the notice under
section 3, or on the first day of September, 1939 with
an addition of 40 per cent, whichever is less :
Provided further that where such land has been
held by the owner thereof under a purchase made before
the first day of April, 1948, but after the first day
of September, 1939, by a registered document, or a
decree for pre-emption between the aforesaid dates, the
compensation shall be the price actually paid by the
purchaser or the amount on payment of which he may have
acquired the land in the decree for pre-emption as the
case may be."
The 1948 Act was enacted to acquire land for
resettlement of displaced persons. As an aftermath of the
partition of India thousands of persons were uprooted from
their habitats and they had to be resettled. Urgent
necessity was to acquire the land and that too at reasonable
price. In order to circumvent the prolix and time-consuming
procedure under the Land Acquisition Act, 1894, a special
act was enacted. Sec. 7 broadly provides for payment of
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compensation for the land to be acquired for carrying out
the purposes of the Act and the manner and method of
computation of compensation. Sub-clause (e) provides for
determining the compen-
577
sation having the due regard to the provisions of sub-
section (1) of the Land Acquisition Act, 1894, that is the
market price of the land on the date of acquisition. The two
provisoes carve out an exception. The first part of the
first proviso is in consonance with Sections 4 and 6 of the
Land Acquisition Act namely that the market value shall be
determined as on the date of the publication of the notice
under section 3. Notice under section 3 served the purpose
of a notification under Sec. 4 of the Land Acquisition Act.
It is the second part of the first proviso that really
affects the compensation, when it says that either the
market value referred to in the first clause of sub-section
(1) of sec. 23 of the said Act shall be deemed to be the
market value of such land on the date of publication of the
notice under section 3 or market value of the land on the
first day of September, 1939, with an addition of 40 per
cent, whichever is less. The second proviso caters to the
situation where land acquired has been held by the owner
thereof under a purchase made before the Ist day of April,
1948 but after the Ist day of April, 1948 but after the Ist
day of September, 1939 which is not the question herein.
Mr. Dua urged that reducing the compensation to the
market value plus 40 per cent as on Ist day of September,
1939 is thoroughly irrelevant to the payment of compensation
and arbitrarily selects the date much earlier to the date of
acquisition and ignores the escalation of price of the land.
It was urged that the situation is not improved by adding 40
per cent to the market value as determined on Ist day of
September ; 1939. The choice of the date September Ist, 1939
does not appear to be arbitrary but has a real nexus to the
object sought to be achieved by the 1948 Act. We are of the
opinion that the choice of the date as Ist September, 1939
is very relevant cannot be struck down as arbitrary because
one can not overlook the historical fact that the Second
World War was declared on September 2, 1939 and India was
dragged into it by a foreign power on September 3, 1939 and
the war situation contributed to the escalation in price of
the land. It is however not necessary to examine in depth
this aspect.
The 1948 Act is admittedly inserted in the Ninth
Schedule by the Constitution (First Amendment) Act, 1951
which also simultaneously added Art. 31-B. The Act finds its
place at plecitum 16 in the Ninth Schedule. Once an act is
placed in the Ninth Schedule, Article 31 B provides that
either the act or any provision thereof shall not be deemed
to be void or ever to have become void on the ground of such
act or any provision thereof is inconsistent with,
578
or takes away or abridges any of the rights conferred by any
provision of Part III of the Constitution. Once the act is
brought under the umbrella of protection of Art. 31-B by
inserting it in the Ninth Schedule, the act is not open to
the challenge that it as a whole or any provision thereof
violates or contravenes any of the fundamental rights
contained in Part III of the Constitution. The allegation
here is that the two provisoes violate the guarantee of fair
compensation and therefore it constitutes deprivation of
property without just compensation, a relic of Art. 31(2)
lifted from Sec. 299(2) of the Government of India Act,
1935.
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The 1948 Act is a pre-Constitution statute. It was
therefore urged that it does not qualify for the protection
of Art. 31-B in as much as when enacted it was violative of
Sec. 299(2) of the Government of India Act, 1935 and as it
was void ab initio, it was not an existing law within the
meaning of expression in Article 366(10) and therefore is
not qualified for umbrella of protection enacted in Art. 31-
B.
Sec. 299 of the Government of India Act, 1935 is almost
in pari materia with repealed Art. 31(2). A Constitution
Bench of this Court in Dhirubha Devi singh Gohil v. The
State of Bombay(1) while upholding the constitutional
validity of the Bombay Talukdari Tenure Abolition Act, 1949
on the ground that it was not covered by the umbrella of
protection of Art. 31-B and the Ninth Schedule held that
Sec. 299(2) of the Government of India Act was in substance
a fundamental right which was lifted bodily as it was from
the Government of India Act, 1935 and put into the Part III
of the Constitution. Accordingly repelling the contention
that the Bombay Act violated Sec. 299(2) and was not
qualified for the protection of Art. 31-B, it was held that
the marginal difference in the language of Sec. 299 and Art.
31-B does not make any difference because what Art. 31-B
protects is not a mere ’contravention of the provisions’ of
Part III of the Constitution but an attack on the grounds
that the impugned act is ’inconsistent with, or takes away
or abridges any of the rights conferred by any provision of
Part III.’ It was accordingly held that even though the
Bombay Talukdari Tenure Abolition Act, 1949 was a pre-
Constitution statute, it would nonetheless be covered by the
umbrella of protection of Art. 31-B. In this connection it
was observed as under :
579
"It will be illogical to construe article 31-B as
affording protection only so far as these rights are
taken away by an Act in violation of the provisions of
the new Constitution but not when they are taken away
by an Act in violation of section 299 of the Government
of India Act which has been repealed. The intention of
the Constitution to protect each and every one of the
Acts specified in the Ninth Schedule from any challenge
on the ground of violation of any of the fundamental
rights secured under Part III of the Constitution,
irrespective of whether they are pre-existing or new
rights, is placed beyond any doubt or question by the
very emphatic language of article 31-B which declares
that none of the provisions of the specified Acts shall
be deemed to be void or ever to have become void on the
ground of the alleged violation of the rights indicated
and "notwithstanding any judgment, decree or order of
any court or tribunal." That intention is also
emphasised by the positive declaration that "each of
the said Acts or Regulations shall, subject to the
power of any competent Legislature to repeal or amend
it, continue in force."
This very question again surfaced in The State of Uttar
Pradesh and Others v. H. H. Maharaja Brijendra Singh(1) in
which constitutional validity of U. P. Land Acquisition
(Rehabilitation of Refugees) Act, 1948 was questioned. The
title of the Act impugned in that case clearly shows that it
was in pari materia with the Act, 1948 both being enacted
with a view to acquire power to acquire land for
rehabilitation of refugees and that too in the same year. It
may as well be mentioned that U. P. Act XXVI of 1948 is also
inserted in the Ninth Schedule. The entry just precedes the
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1948 Act. The High Court while upholding the validity of
Sec. 11 which is in pari materia with Sec. 7 of 1948 Act
struck down the two provisoes to Sec. 11 similarly worded as
the two provisoes to Sec. 7 (1) (e). Both the provisoes are
in pari materia with the impugned provisoes. This Court,
reversing the decision of the High Court and following the
decision in Dhirubha Devisingh Gohil’s case while upholding
the constitutional validity of the Act held that the
protection under Art. 31B against the violation of the
fundamental rights mentioned therein must extend to the
rights under Sec. 299 of the Government of India Act also.
The reasons which weighed with the Constitution Bench of
this Court while upholding the validity of the U. P. Act.
will
580
mutatis mutandis apply here and we must uphold the validity
of the two provisos on parity of reasoning.
It is thus satisfactorily established that in view of
the insertion of the 1948 Act in Ninth Schedule it enjoys
the umbrella of protection of Art. 31-B and therefore it is
immune from the challenge as violating any of the provisions
in Part III of the Constitution. In fact this should end the
controversy.
Mr. Dua however urged that in view of the decision of
this Court in N.B. Jeejeebhoy v. Assistant Collector, Thana
Prant, Thana(1) wherein this Court struck down the Land
Acquisition (Bombay Amendment) Act, 1948 as constitutionally
invalid would necessitate re-examination of the decisions in
Dhirubha Devisingh Gohil’s case and Maharaja Brijendra
Singh’s case. It was submitted that the decision in
Jeejeebhoy’s case comes later in point of time both to the
decision in Dhirubha Gohil’s and Maharaja Brijendra Singh’s
case, and therefore the later decision should prevail with
this Court. In Jeejeebhoy’s case, this Court repelled the
contention that the Amendment Act is saved by Art. 31-A of
the Constitution. The argument of the learned Attorney
General that Sec. 299 of the Government of India Act, 1935
declared a fundamental right of a citizen, that it is bodily
lifted and introduced by the Constitution in Art. 31(2)
thereof and that if Art. 31-A saved an attack against the
Amending Act on the ground that it infringed Art. 31(2)
thereof, it would equally save the attack based on the
infringement of Sec. 299(2) of the Government of India Act,
1935 was disposed of by merely observing that the argument
is far fetched. It may however be mentioned that in this
later decision, the decisions of the Constitution Bench in
Dhirubha Devisingh Gohil’s case and the Maharaja Brijendra
Singh’s case were merely referred to but not overruled. They
were distinguished on the ground that the statutes impugned
in those cases enjoyed the protection of Art. 31-B. That is
a fact and would make all the difference. The impugned Act
in Jeejeebhoy’s case did not enjoy the protection of the
Ninth Schedule and Art. 31-B, and therefore the decision in
Jeejebhoy’s case is hardly of any assistance.
It was lastly urged that the decision of the larger
Bench in Rustom Cavasjee Cooper v. Union of India(2) would
clearly show that
581
the decision of this Court in State of Gujarat v. Shantilal
Mangaldas and Others is no more good law and therefore it is
open to the Court to examine whether compensation offered by
the relevant provisions of the Statue is illusory or
prescribe principles well-recognised for valuation of land.
In our opinion, this aspect is hardly relevant because once
the impugned statute or the impugned provisions of the
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statute enjoy the protection of Art. 31-B, it is not open to
the Court to examine whether the principles for valuation
therein prescribed are relevant to the land valuation
because that question arises where a complaint as to the
contravention of fundamental rights enacted in repealed
Art.31 can be entertained and examined. That complaint has
to be rejected at the threshold as soon as it is pointed out
that the impugned statute or the impugned provisions of
statute enjoy the protection of Art. 31-B. It may be
mentioned that in Smt. Mohinder Kaur’s case, a Full Bench of
Delhi High Court examined and upheld the constitutional
validity of the two provisoes to Sec. 7(1)(e) of the 1948
Act. We agree with the view taken by the High Court and
upheld the same.
Constitutional validity of the provisoes to Sec.
7(1)(e) of the 1948 Act was the only point canvassed in
these two appeals and as there is no merit in it, both the
appeals fail and are dismissed without any order as to
costs.
In Civil Appeal No. 922 of 1971 the appellant died
pending the appeal and substitution is sought by one Kumari
Abha Gupta basing her claim on the will dated July 27, 1980
of the deceased. The will has neither been probated nor
anywhere its validity is determined. It is not necessary for
us to undertake this exercise here. We grant the
substitution limited to the purposes of the appeal but if in
any appropriate proceeding, the question of the validity of
the will arises, the same could not be said to have been
concluded by this Court granting the substitution. Subject
to this condition, the substitution is granted.
H.S.K. Appeals dismissed.
582