Full Judgment Text
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 33
PETITIONER:
SMT. SOMAVANTI AND OTHERS
Vs.
RESPONDENT:
THE STATE OF PUNJAB AND OTHERS(And Connected Petitions)
DATE OF JUDGMENT:
02/05/1962
BENCH:
MUDHOLKAR, J.R.
BENCH:
MUDHOLKAR, J.R.
AIYYAR, T.L. VENKATARAMA
SINHA, BHUVNESHWAR P.(CJ)
SUBBARAO, K.
AYYANGAR, N. RAJAGOPALA
CITATION:
1963 AIR 151 1963 SCR (3) 774
CITATOR INFO :
F 1963 SC1890 (5)
RF 1965 SC 646 (9)
RF 1966 SC1788 (19A,21)
D 1967 SC1074 (9)
RF 1967 SC1081 (3)
F 1968 SC 432 (15)
F 1970 SC 984 (7)
RF 1971 SC 306 (10)
R 1971 SC1033 (8,9)
F 1973 SC 974 (10)
RF 1973 SC1461 (1071)
E 1975 SC1182 (3)
F 1977 SC 183 (6)
R 1978 SC 515 (3,4,6)
F 1979 SC1713 (5)
R 1980 SC 214 (20)
RF 1980 SC1678 (4)
F 1984 SC 120 (4)
F 1985 SC1622 (13)
RF 1988 SC 501 (5)
F 1988 SC 686 (18)
F 1988 SC1353 (18)
D 1989 SC 682 (4,7)
R 1989 SC2105 (6)
RF 1992 SC1456 (30)
ACT:
Land Acquisition-Public purpose Government declaration as
to public purpose-If justiciable-"Conclusive evidence"
"Conclusive Proof Meaning of-Compensation-Government’s
contribution of cost-if should be substantial-Indian
Evidence Act, 1872 (1 of 1872), ss. 3, 4-Land Acquisition
Act, 1894 (1 of 1894) , ss. 4, 5A, 6-Constitution of India,
Art. 14.
HEADNOTE:
In February, 1961, the petitioners purchased over six acres
of land situate in the State of Punjab for a sum of Rs.
4,50,000 and claim, to have done so for the purpose of
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 33
establishing a paper mill. The sixth respondent, private’
limited company, which had a licence from the Government of
India for starting a factory for the manufacture of various
775
ranges of refrigeration compressors and ancillary equipment,
requested the State of Punjab for the allotment of an appro-
priate site for the location of the factory. In the
official Gazette of August 25, 1961. was published ’a
notification of the Governor of Punjab dated ’August 18,
1961, under s. 4 of the Land Acquisition Act, 1894, to the
effect that the land belonging to the petitioners was likely
to be needed by the Government at public expenses for a
public purpose, namely, for setting up a factory for
manufacturing various ranges of refrigeration compressors
and ancillary equipment. The Government directed that
action under s. 17 of the Act shall be taken because there
was urgency and that the provisions of s. 5A shall not apply
to the acquisition. In the same Gazette another
notification under s. 6 of the Act dated August 19, 1961,
was published to the effect that the Governor of Punjab was
satisfied that the land was required by the Government at
public expense for the said purpose, The notification
provide for the immediate taking of possession of the land
under the provisions of s. 17 (2) (c) of the Act. On
September 29, 1961, the Government of Punjab sanctioned an
expense of Rs. 100 for the purpose of acquisition of the
land. The petitioners filed an application under Art. 32 of
the Constitution of India challenging the legality of the
action taken, by the Government on the grounds, inter alia,
(1) that the acquisition was not for a public purpose either
under s. 4 or s. 6 of the Land Acquisition Act; (2) that the
land was in reality being acquired for the benefit of the
sixth respondent and that the action of the Government
amounted to discrimination against the petitioners and
violated Art. 14 of the Constitution of India; (3) that the
alleged contribution of Rs. 100 made by the Government was a
colourable exercise of power inasmuch as the amount was so
unsubstantial sum compared to the value of the property that
it could not raise an inference of Government participation
in the proposed activity; and (4) that the notifications
under ss. 4 and 6 could not have been made simultaneously
and were, therefore, without efficacy.
Held (per Sinha, C. J., Rajagopala Ayyangar, Mudholkar and
Venkatarama Aiyar, jj.), (1) that the declaration made by
the Government in the notification under s. 6 (1) of the
Land Acquisition Act, 1894, that the land was required for a
public purpose, was made conclusive by sub-s. 3 of s. 6 and
that it was not open to a court to go behind it and try to
satisfy itself whether in fact the acquisition was for a
public purpose.
Whether in a particular case the purpose for which land was
needed was a public purpose or not was for the
776
Government to be satisfied about and the declaration of the
Government would be final subject to one exception, namely
that where there was a colourable exercise of the power the
declaration would be open to challenge at the instance of
the aggrieved party.
Hamabai Framjee Petit v. Secretary of State for India,
(1914) L. R. 42 I. A. 44 and R. L. Arora v. The State of
Uttar Pradesh, (1962) Supp. 2 S. C. R. 149 distinguished.
Vedlapatla Suryanarayana v. The Province of Madras,
I. L. R. (1946) Mad. 153, approved.
(2) that there wag no difference between the effect of the
expression "conclusive evidence" in s. 6 (3) of the Act from
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 33
that of "conclusive proof", the aim of both being-to give
finality to the establishment of the existence of a fact
from the proof of another.
(3) that the conclusiveness in s, 6 (3) must necessarily
attached not merely to a "need" but also to the question
whether the purpose was a public purpose. There could be
no "need" in the abstract.
(4) that the provisions of the Act which provided that the
declaration made by the State that a particular land was
needed for a public purpose, shall be conclusive evidence of
the fact that it was needed, did not infring the
Constitution.
State of Bihar v. Maharajadhiraja Sir Kameshwar Singh of
Darbhanga & Ors., [1952] S. C. R. 889, Babu Barkya Thakur v.
State of Bombay & Ors., [1961] 1 S. C. R. 128, and State of
Bombay v. Bhanji Munji & Anr., [1955] 1 S. C. R. 777, relied
on.
(5) that it was for the State to say which particular
industry might be regarded as beneficial to the public and
to decide that its establishment would serve a public
purpose; therefore, no question of discrimination would
arise merely from the fact that the Government had declared
that the establishment of a particular industry was a public
purpose. Accordingly, the notifications in question, did
not contravene Art. 14 of the Constitution.
(6) that as s. 5A was out of the way the publication in the
game issue of the Gazette of the both the notifications that
is the one dated August 18, 1961, and that dated August 19,
1961, was not irregular.
Held, further (Subba Rao, J., dissenting), that the noti-
fication dated August 19, 1961, under s. 6 of the Land
Acquisition Act, 1894, was not invalid on the ground that
the
777
amount contributed by the State towards the cost of the
acquisition was only nominal compared to the value of the
land.
The expression "party out of public revenues" in the proviso
to s. 6 (1) of the Act did not necessarily mean that State’s
contribution must be substantial; but whether a token
contribution by the State towards the cost of acquisition
would be sufficient compliance with the law would depend
upon the facts of each case and it was open to the court in
every case which came before it to ascertain whether the
action of the State was a colourable exercise of power.
Sanja Naicken v. Secretary of State, (1926) I. L. R. 50 Mad.
308 and Vadlapatla Suryanaryana v. The, Province of Madras,
1. L. R. [1946] Mad. 153, approved.
Ponnaia v. Secretary of State, A. 1. R. 1926 Mad. 1099,
disapproved.
Chatterton v. Cave, (1878) 3 App. Cas. 483 and Maharajah
Luchmeswar Singh v. Chairman of the Durbhanga Municipality,
(1890) L. R. 17 I. A. 90 held inapplicable.
Per Subba Rao, J.-in interpreting the proviso to s. 6 (1) of
the Act a reasonable meaning should be given to the
expression "wholly or partly." The payment of apart of a
compensation must have some rational relation to the
compensation payable in respect of the acquisition for a
public purpose. So construed "part can only mean
substantial part of the estimated compensation. What was
substantial part of a compensation depended upon the facts
of each case. In the instant case, it was impossible to say
that a sum of Rs. 100 out of an estimated compensation which
might go even beyond Rs. 4,00,000 was in any sense of the
term a substantial part of the said compensation. The
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 33
Government had clearly broken the condition and, therefore,
it had no jurisdiction to issue the declaration under s. 6
of the Act.
JUDGMENT:
ORIGINAL JURISDICTION : Petitions Nos. 246 to 248 of 1961.
Petitions under Art. 32 of the Constitution of India for the
enforcement of Fundamental Rights.
G. S. Pathak, Rameshwar Nath, S. C. Andley and P. L. Vohra,
for the petitioners (in petition No. 246 of 1 96 1),
778
Rameshwar Nath, S. N. Andley and P. L. Vohra for the
petitioners (in petitions Nos. 247 and 2 48 of 196 1).
S. M. Sikri, Advocate-General J. for the State Of Punjab,
N. S. Bindra and P. D. Menon, for respondent No. 1 (in all
the petitions).
S. P. Varma, for respondent No. 6 (in all the petitions).
H. N. Sanyal, Additional Solicitor-General of India, R. H.
Dhebar and P. D. Menon, for the State of Gujarat
(Intervener) (in all the petitions).
1962. May 2. The following judgments were delivered. The
judgment of Sinha, C. J., Rajagopala Ayyangar, Madholkar and
Venkatarama Aiyar, J J., was delivered by Mudholker, J.
MUDHOLKAR, J.-The petitioners who have acquired over six
acres of land by purchase for Rs. 4,50,009 in February,
1961, under five sale deeds and one lease deed claim to have
done so for the purpose of establishing a paper mill in
collaboration with Messrs. R. S. Madhoram and Sons who had
been granted a licence for the establishment of a paper
plant in Ghaziabad in Uttar Pradesh. The aforesaid land is
situate in the village Meola Maharajpur, Tehsil Ballabhgarh,
District Gurgaon, and abuts on the Mathura Road, and is only
about 10 or 12 miles from New Delhi. Respondent No. 6, Air
Conditioning Corporation (P) Ltd., is a private limited
concern and holds a licence from the Government of India for
starting a factory for the manufacture of various ranges of
refrigeration compressors and ancillary equipment. We may
mention here that initially this project was allotted to the
State of West Bengal but at the request of State of Punjab
its location was shifted to the State of Punjab.
779
Respondent No. 6 requested the State of Punjab for the
allotment of an appropriate site for the location of the
factory. The petitioners contend that respondent No. 6
being interested in acquiring land in the village Meola
Maharajpur approached the State of Punjab in or about the
month of March, 1961, for the purpose of acquiring land for
their factory under the Land Acquisition Act, 1894
(hereinafter referred to as the Act). One of the
petitioners having learnt of this made an application on
March 23, 1961, to the Deputy Commissioner, Gurgaon,
requesting him that none of the lands purchased by the
petitioners should be acquired for the benefit, of
respondent No. 6. Owners of adjacent lands Mr. Om Prakash,
Mr, Ram Raghbir, Mr. Atmaram Chaddha and Mr. Hari Kishen
who are petitioners in W. P. 247 and 248 of 1961 which were
heard along with. this petition made similar requests. The
petitioners allege that they were assured by the Deputy
Commissioner that their lands would not be acquired for the
benefit of respondent No. 6. Thereafter respondent No. 6
purchased by private treaty a, plot of land measuring
approximately 70,000 sq. yards contiguous to, the land owned
by the petitioners on or about April 21, 1961.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 33
The, petitioners grievance is that notwithstanding the
assurances given to them by the Deputy Commissioner,
Gurgaon, the Governor of Punjab, by notification dated
August 25, 1961, under s. 4 of the Act declared that the
lands of the petitioners in this petition as well as those
of the petitioners in the other two writ petitions were
likely to be needed by Government at public , expense for a
public purpose, namely, for setting up a factory for
manufacturing various ranges of refrigeration
compressors.,and, ancillary equipment. It accordingly
notified that the, land in: the locality described
780
in the notification was required for the aforesaid purpose.
Similarly it authorised the Sub-Divisional Officer and Land
Acquisition Officer, Palwal, to enter upon and survey the
land in the locality and to do all other acts required or
permitted by s.4 of the Act. It further directed that
action under s. 17 of the Act shall be taken because there
was urgency and also directed that the provisions of s 5A
shall not apply to the acquisition. On August 19, the
Governor of Punjab made a notification under s. 6 of the Act
to the effect that he was satisfied that the land specified
in the notification was required by Government at public
expense for public purpose, namely, for setting up a factory
for the manufacture of refrigeration compressors and other
ancillary equipment and declared that the aforesaid land was
required for the aforesaid purposes. This declaration was
made "to all whom it may concern" and the Sub-Divisional
Officer, Palwal, was directed to take all steps for the
acquisition of this land. Finally the notification provided
for the immediate taking of possession of the land under the
provisions of s. 17 (2) (c) of the Act. Both these
notifications were published in the Punjab Government
Gazette of August 25, 1961.
The petitioners contend that these notifications and the
land acquisition proceedings permitted to be taken under
them violate their fundamental rights under Art. 19 (1) (f)
and (g) to possess the said land and carry on their
occupation, trade or business and that, therefore, they
must be quashed.
It is their contention that they have purchased this land
bona fide for industrial purposes as land in the vicinity of
this land is being acquired by industrialists for
establishing various industries. The purpose is said to be
the establishment of a paper manufacturing plant. According
to them
781
they have entered into an arrangement with Messrs. R. S.
Madho Ram & Sons who hold industrial licence No. L/2-1/2
(1)/N-60/62. The proposed industry, according to them,
would employ about 200 people. The industry they wish to
start is a new one so far as they are concerned, whereas
according to them, the respondent No. 6 is already engaged
in refrigeration industry and as far as they know, it has
established a factory for manufacturing refrigeration
equipment at Hyderabad in the State of Andhra Pradesh.
It may be mentioned that some time after the notification
was published, that is, on September 29, 1961, the
Government of Punjab sanctioned the expense of Rs. 100 for
the purpose of acquisition of this land. According to the
petitioners this was an after-thought and besides, a token
contribution of this kind is not sufficient to show that the
acquisition is being made partly at public expense.
The petition was opposed not only by respondent No. 6 but
also by the State of Punjab which is respondent No. 1 to the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 33
petition. The respondent No. 1 denied that the petitioners
had purchased the land for a bona fide industrial purpose
and would in fact use it for such purpose. It also denied
that any assurance was give to the petitioners that their
lands would not be acquired. It admitted that the
respondent No. 6 had made an application in December, 1960
for acquiring land for setting up its factory and that,
therefore, the Punjab Government agreed to do the needful.
According to respondent No. 1 the acquisition proceedings
have been undertaken for a public purpose and at public
expense as stated in the notification and that the State
Government would make part contribution towards the, payment
of compensation of the land’ out of public revenues. In the
circumstances it in
782
contended that the petitioners would not be entitled to any
relief whatsoever. They would of course get compensation
for the land as determined by the Land Acquisition Officer.
The action of the State Government is said to be legal and
in accordance with the provisions of the law because what
was done was permissible under ss.4 and 6 of the Act, that
it was done bona fide, that part of the compensation would
be paid out of the, public revenues, that the declaration
made by the Government is conclusive evidence under sub-s.
(3) of s.6, that the land is needed for ,a public purpose,
that the notifications were made on different dates though
they were published in the same issue of the Gazette and are
perfectly valid, that the land is not being acquired for a
company but for a public purpose, that, therefore, the
provisions of Part VII of the Act are inapplicable and that
the lands are lying vacant and their owners will be paid
compensation. No question of depriving them of their
fundamental rights under Art. 19(1)(f) and (g) or of
violation of their right under Art. 14 therefore arises.
According to respondent No. 1 it would be open to the
petitioners to make their claim for compensation to the Land
Acquisition Officer for such loss as the acquisition would
entail on them. It also stated that as the land purchased
by the respondent No. 6 through private negotiation has no
access to the main road’ and as the land is inadequate to
meet the minimum essential requirements the acquisition of
the, lands in question became necessary.
On behalf of the respondent No. 6 it is stated that the need
for a factory like the one in its con. temptation is acutely
felt in India inasmuch a manufacture of compressors and the
composes nts of big and small air-conditioners,
refrigerators,
783
water coolers and cold storage cabinets is not being carried
out anywhere in the country so far. The import of these
goods naturally drains away a considerable amount of foreign
exchange. It was, therefore, felt that by starting
manufacture of these articles in our country not only Will
foreign exchange be saved, but some foreign exchange will
eventually be earned by the export of manufactured goods.
They further contend that the purpose for which the factory
is being set up must be regarded as a public purpose because
inter alia it is intended by manufacturing the aforesaid
goods, to cater to the needs of the public at large. It is
in view of these circumstances that the Government of India,
accepting the recommendation made in this regard by the
licensing committee under the Industries Development and
Regulation Act, 1951, issued a licence in its favour on
April 8, 1951. It then pointed out that it has secured the
collaboration in this project of a well-known American
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 33
Company named Borg-Warner International Corporation of
Chicago, which is the biggest manufacturers of air
conditioning plants and equipment in the world, and that the
collaboration agreement has been approved by the Government
of India in the Ministry of Commerce. Its grievance is that
this agreement has not been implemented so far because it
has not been able to get the land for constructing the
building in which the necessary machinery and ,implements’
could be installed. Finally it says that originally the
licence was issued for setting up a factory in the State of
West Bengal and that it was at the instance of the
Government of Punjab that the Central Government permitted
the location of the factory to be shifted from West Bengal
to Punjab. According to it once the factory gets going it
is likely to employ at least 1,000 workers.
It is not necessary to refer to the other affidavits and the
rejoinder affidavits except to some
784
portions of the additional affidavit filed by Mr. M. B.
Bhagat, Under Secretary on behalf of the respondent No. 1.
We are referring only to those portions which were relied on
during the arguments before us. In that affidavit it is
denied that any licence had been granted to Messrs. R. S.
Madho Ram & Sons for the establishment of a paper plant in
the Punjab. According to respondent No. 1 Messrs. R. S.
Madho Ram & Sons were granted a licence on August 17, 1960,
for the establishment of an industrial undertaking in
Ghaziabad (U.P.) for the manufacture of writing and printing
paper and pulp. It further stated that even this licence
has been cancelled by the Government of India by their
letter dated January 31, 1962. Since the said licensee did
not take any effective steps to establish the same. It then
stated that the Air Conditioning Corporation which was
incorporated as a private limited company has since, with
the permission of the Central Government, been converted
into a public limited company with the name and style of
"York India Ltd.", and that the company has been granted a
licence to manufacture refrigeration equipment by the
Industrial Licensing Committee. There is an agreement
between York India Ltd., and Messrs. York Corporation,
U.S.A. a subsidiary of Borg Warner of the U.S.A. whereunder
the latter have undertaken to give all technical assistance
and technical training to the Indian personnel as also to
contribute 50% of the initial investment in the undertaking.
The respondent No. 6 expects to manufacture 70% of the
equipment in the very first year and cent. per cent, by the
end of 1966. It further stated that the foreign
collaborators also have agreed to sell the products of the
firm outside India at prices and on terms and conditions
most favourable to the Indian firm, thereby enabling it to
obtain access to the foreign market. The foreign
collaborator would make available to the Indian
785
personnel the technical ,know-how’ and other information
necessary for the manufacture of refrigeration materials and
that such assistance will itself be very valuable. It
denied that the respondent No. 6 has established a factory
similar to the one now intended to be established in
Hyderabad as alleged by the petitioners. It is admitted
that licences have been granted to two other concerns in
India for the manufacture of similar equipment. Neither of
those licensees has actually started production, at any
rate, so far, and, therefore, it is not correct to say that
similar equipment is already being manufactured in India.
Then it stated "the products that are to be manufactured by
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 33
the respondent till now were being imported into India from
foreign countries and goods worth about Rs. 3,83,70,000 in
1960 and for the first ten months in 1961 Rs. 3,56,50,000
were imported by the various licensees holding import licen-
ces." It also stated that the respondent No. 6 was granted
licence to establish a factory in West Bengal but since no
one had been granted a licence to establish a factory of
this kind in the Punjab its licence was transferred to
Punjab. The proposed factory would employ a large number of
persons and thus help to solve to some extent the exisiting
problem of unemployment in Punjab. Finally it stated that
the establishment of the factory as such is in furtherance
of the industrial development of the Punjab State and is,
therefore, for a public purpose.
On behalf of the petitioners Mr. Pathak has raised the
following five contentions :
(1) The acquisition is not for a public
purpose either within s.4 or s.6 of the Land
Acquisition Act or for a purpose useful to the
public as contemplated in s.41 and that the
action of the Government amounted to
786
acquiring property from one person and giving
it to another.
(2) The alleged contribution of Rs. 100 made
by the Government is a colourable exercise of
power, that no such intention was mentioned
prior to the notification and that the amount
of Rs. 100 is so unsubstantial a gum compared
to the value of the property that it cannot
raise an inference of Government participation
in the proposed activity.
(3) That the property is in fact being
acquired for a company and, therefore, the
provisions of Part VII of the Act should have
been complied with. Non-compliance with those
provisions vitiates the acquisition.
(4) The petitioners.’ proposed paper mill
would be as good an industrial concern as the one intended
to be established by respondent
No. 6 and the Government, in preferring the
latter to the former, has violated the
guarantee of equal protection of law provided by
Art. 14 of the Constitution.
(5) That the notification under ss. 4 and 6
could not have been made simultaneously and
are, therefore, without efficacy,
We may deal with the third point raised by Mr. Pathak first,
that is, regarding non-compliance of provisions of Part VII.
It is common ground that those provisions were not complied
with. The reason for that is, that according to the
respondents the acquisition is not for a company but for a
public purpose, partly at public expense. Indeed, the
respondents at no stage have relied on the provisions of
Part VII of the Act and therefore, the main question to be
considered is whether the acquisition is for a public
purpose
787
partly at public expense or not. If it is so, then, of
course, the petitions must succeed. Therefore, it is the
first two contentions raised by Mr. Pathak which primarily
need our consideration.
According to learned counsel for the petitioners the
statements made in the affidavits on behalf of the; State
as; well as, on behalf of the respondent No. 6 make it
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 33
perfectly clear that the land is being acquired for the
respondents No. 6. Reliance, is placed particularly upon
that portion of the affidavit of the State, where it is
stated that the land is acquired for enabling the respondent
No. 6, to have access to the main road and for meeting their
minimum requirements for establishing their factory, It is
further stated that the compensation for all the land which
is being acquired is to come out of the pockets not of the,
State Government but the respondent No. 6 itself. No doubt,
the Government has said that it has sanctioned the payment
of Rs. 100 towards the payment of compensation but that is
only an insignificant fraction of the total amount of
compensation that would be payable in, respect of these Ian-
(Is, the petitioners the a themselves-having paid Rs.
4,50,000 to the persons from whom they acquired these lands.
On behalf of the respondents the learned Advocate-General
for Punjab contended that the declaration of the Government
in the notification that the land is required for a public
purpose is made conclusive by sub-s. 3 of s. 6 of the Act
and, therefore, it is not open to this Court to go behind it
and try to satisfy itself whether in fact the acquisition is
for a public, purpose or not. Alternatively he contended
that the land is being acquired for a public purpose because
the object of the acquisition is to establish a new industry
788
and do away with imports of refrigeration equipment and to
enable technical education to be imparted to Indian
personnel in a new field. He further said that the
acquisition will not only save foreign exchange by lessening
imports but will enable foreign exchange to be earned from
the export of goods manufactured in the proposed factory.
The new industry is said to be of great economic importance
inasmuch as it will enable the preservation of food which
will otherwise be destroyed. Refrigeration equipment also
contributes towards the maintenance of health because it
enables storage of medicines such as antibiotics which are
liable to be decomposed at normal temperatures prevailing in
our country. The industry proposed to be started will open
a new avenue of employment and diminish unemployment and
generally advance the industrial development of the country.
Finally he said that a part of the land is required for
building houses and quarters for the workers of the factory
and to give amenities to them. All these purposes are,
therefore, said to be public purposes. Reliance was placed
by him on Vol. 19 of Encyclopaedia Britannica, pp. 49 to 57
for showing the manifold applications of refrigeration in
various industries and activities. Reference was also made
to Vol. 18 of Encyclopaedia Britannica, p. 745 wherein
facilities for providing refrigeration have been grouped
under the heading Public utility’. Reference was also made
to be next page where it is stated "Every public utility
must be in possession of natural resources upon which that
industry is based. Their sites must have strategic
locations. Limitation in the choice of this agent of
production tends to make the cost of acquiring or leasing
these facilities greater than it would be if the industry
had a wider range of choice. Furthermore, utilities must
make allowances in advance for probable increase in the
required capacity. For these reasons utilities are provided
780
with the governmental power of eminent domain which makes
possible the ‘compulsory sale of private property." Relying
upon the affidavit of Mr. Bhagat, to which we have referred
earlier, the learned Advocate-General of Punjab said that
the object of the Government in acquiring these lands is to
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 33
enable a new industry to be established not only for saving
foreign exchange and earning foreign exchange bat also for
securing the industrial advancement of the country, enabling
the citizens to obtain technical education in a new field,
relieving to some extent the Pressure of unemployment and so
on. For all these reasons he contends that the acquisition
must be deemed to be for a public purpose even though the
bulk of the compensation for the acquisition will come from
the pockets of respondent No. 6.
In our opinion the question whether any of the aforesaid
purposes falls within the expression public purpose would
arise for consideration only if the declaration of the
Government is not conclusive or if the action of the
Government is colourable. If, as contended by the learned
Advocate General, sub-s. 3 of s. 6 concludes the matter-and
the validity of this provision is not challenged and the
action of the Government is not colourable the other
question would not arise for consideration.
It is strenuously contended on behalf of the petitioners
that sub-s. 3 of s. 6 does not debar this Court from
considering whether a purposed acquisition is for a public
purpose or not. It is said, in the first place, that this
provision only makes the declaration "conclusive evidence"
and not "conclusive proof" and then contended that the
declaration is conclusive evidence only of a need and
nothing more.
A distinction is sought to be made between "Conclusive
proof" and "conclusive evidence" and
790
it is contended that where a law declares that a fact shall
be conclusive proof of another, the Court is precluded from
considering other evidence once such fact is established.
Therefore, where the law makes a fact conclusive proof of
another the fact stands proved and the Court must proceed on
that basis. But, the argument proceeds, where the law does
not go that far and makes a fact only "conclusive evidence"
as to the existence of another fact, other evidence as to be
existence of the other fact is not shut out. In support of
the argument reliance is placed on s. 4 of the Indian
Evidence Act which in its third paragraph defines
’conclusive proof’ as follows :
"When one fact is declared by this Act to be
conclusive proof of another, the Court shall,
on proof of the one fact, regard the other as
proved, and shall not allow evidence to be
given for the purpose of disproving it".
This paragraph thus provides that further evidence is barred
where,, under the Indian Evidence Act, one fact is regarded
as proof of another. But it says nothing about what other
laws may provide. There are a number of laws which make
certain fact& conclusive evidence of other facts: (see
Companies Act, 1956, s. 132 ; the Indian Succession Act,
1925, s. 381 ; Christian Marriages Act, 1872, s. 61 ; Madras
Revenue Act, 1869, s. 38 ; Oaths Act, 1873, s. (11). The
question is whether such provision also bars other evidence
after that which is conclusive evidence is produced.
The object of adducing evidence is to prove a fact. The
Indian Evidence Act, deals with the, question as to what
kind of evidence is permissible to be adduced for that,
purpose and states in s. 3 when a fact is said to be proved.
That section reads thus
791
’Evidence’ means and includes-
(1) all statements which the court permits
or requires to be made before it by witnesses,
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 33
in, relation to matters of fact under, inquiry
; such statements are called oral evidence ;
(2) all documents produced for the
inspection of the court ; such documents are
called documentary evidence.
A fact is said to be proved when, after
considering the matters before it, the Court
either believes it to exist, or considers its
existence so probable that a prudent man
ought, under the circumstances of the
particular case, to act upon the
supposition that it exists."
Since evidence means and includes all statement which the
court permits or requires to be made,. when the law says
that a particular kind of evidence would be conclusive as to
the existence of a particular fact it implies that that
fact can be proved either or by evidence or by some other
evidence which the Court permits or requires to be advanced.
Where such other evidence is adduced it would be open to the
Court to consider whether, upon that evidence, the fact
exist or not. Where on the other hand, evidence which is
made conclusive is adduced, the Court has no option but to
hold that the fact exists. If that were not so, it would be
meaningless to call a particular piece of evidence as
conclusive evidence. Once the law says that certain
evidence is conclusive it shuts out any other evidence which
would detract from the conclusiveness of that evidence., In
substance, therefore, there is no difference between
conclusive evidence and
792
conclusive proof. Statutes may use the expression
’conclusive proof’ where the object is to make a fact non-
justiciable. But the legislature may use some other
expression such as ’conclusive evidence’ for achieving the
same result. There is thus no difference between the effect
of the expression conclusive evidence’ from that of
’conclusive proof’, the aim of both being to give finality
to the establishment of the existence of a fact from the
proof of another.
Learned counsel contends that it is open to the Court to
examine whether the action of the executive, even in the
absence of an allegation that it is malafide, is related to
the section or not and for this purpose to consider whether
the acquisition is for a public purpose. In support of this
contention he has relied upon the decision in State of Bihar
v. Maharajadhiraja Sir Kameswarsingh of Darbhanga(1).
There, Mahajan, J. ’as he then was,) has expressed the view
that the exercise of power to acquire compulsorily is
conditional on the existence of public purpose and that
being so this condition is not an express provision of Art.
31 (2) but exists aliund in the content of the power itself.
That, however, was not the view of the other learned Judges
who consitituted the Bench. Thus according to Mukherjea,
J., (As he. then was), the condition of the existence of a
public purpose is implied in Art. 31(2). (See pp. 957, 958).
Das. J. (as he then was), was also of the same view. (See
pp. 986 988). Similarly Patanjali Sastri, C.J., has also
taken the view that the existence of public purpose is an
express condition of cl. 2 of Art. 31.
The Constitution permits acquisition by the State of private
property only if it is required for a, public purpose. But
can it; therefore, be said
(1) [1952] S.C.R.889 935.
793
that the provisions of a statute must be so construed that
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 33
the declaration by the Government as to the existence of
public purpose is necessarily justiciable ? We are not
concerned here with a post Constitution law but with a pre-
Constitution law. The Act has been in operation since 1894.
The validity of the law was challenged before this Court in
Babu Barkya Thakur v. The State of Bombay (1) on the ground
that it infringes the provisions of Arts. 31(2) and 19(1)(f)
of the Constitution. But this Court held that the law being
a pre-Constitution law is protected from the operation of
Art. 31(2) by the provisions of Art. 31(5) (a). It also
held, following the decision in the State of ,Bombay v.
Bhanji Munji (2) and that in Lilavati Bai v. The State of
Bombay (3) that the attack under Art. 19(1)(f) of the
Constitution is futile.
The argument, however, is that the protection which the Act
enjoys is only to this extent that even though any of its
provisions be in conflict with Art.31(2) the Act cannot be
challenged on that ground ; the protection does not however
extend to other provisions of Part III of the Constitution,
such as Art. 19(1)(f). As we understand the decision in
Bhanji Munji’s case (2) what this Court has held is that for
a right under Art. 19(1).(f) to bold property to be
available to a person, he must have the property with
respect to which he can assert such right. If the right to
the possession of the property is taken away by law
protected by Art. 31 (5) (a), Art. 19 (1) (f) is not
attracted. That is the decision of this Court and it has
been followed in two other cases. All the decisions are
binding upon us. It is contended that none of the decisions
has considered the argument advanced before us that a law
may be
(1) (1961) 1 S.C.R. 128- (2) 0935) 1 S.C.R. 777-
(3) (1957) S.C.R. M.
794
protected from an attack under Art. 31 (2) but it *ill still
be invalid under Art. 13 (2) if the restriction placed by it
on the right of a person to hold property is unreasonable.
In other words, for the law before us to regarded as valid
it must also satisfy the requirements of Art. 19(5) and that
only thereafter can the property of a person be taken away.
It is sufficient to say that though this Court may not have
pronounced on this aspect of the matter we are bound by the
actual decisions which categorically negative an attack
based on the right guaranteed by Art. 19(1)(f). The binding
effect of a decision does not depend upon whether. a
particular argument was considered therein or not, provided
that the point with reference to which an argument was
subsequently advanced was actualy decided. That point has
been specifically decided in the three decisions referred to
above.
We, therefore, hold that since the Act provides that the
declaration made by the State that a particular land is
needed for a; public purpose shall be conclusive evidence of
the fact that it is so needed the Constitution is not
thereby infringed.
For ascertaining the extent to which the determination by
the State is conclusive it would be desirable to examine the
relevant provisions of the Act. The preamble states that
the law is for the acquisition of land needed for public
purposes and for companies and incidental matters connected
therewith. Section 2(f) defines public purpose as follows :
"the expression ’public purpose’ includes the
provision of village sites in districts in
which the appropriate Government shall have
declared by notification in the Official
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 33
Gazette that it is customary for the
Government to make such provision:"
795
This is an inclusive definition and not a compendious one
and therefore, does not assist us very much in Ascertaining
the ambit of the expression ’public purpose’.
Broadly speaking the expression public purpose’ would,
however, include a purpose in which the general interest of
the community, as opposed to the particular interest of
individuals, is directly and vitallv concerned. Then
there is s. 4 which enables the State to publish a
preliminary notification whenever it appears to it that land
in any locality is needed or is likely to be ,needed for a
public purpose. The other aspects of the section have no
bearing upon the point before us and we need not refer to
them. Then there its s. 5A which gives to the person
interested in the land which has been notified as being
needed or likely to be needed for a public purpose or for a
company, the right to object to the acquisition of the land.
Such objection has to be heard by the Collector and after
making such further enquiry as he thinks necessary the
record has to be submitted to the appropriate Government
along with the report containing the Collector’s
recommendations and the objections. subsection (2) of s. 5A
makes the decision of the Government on the objections
final. This is followed by s. 6 sub. s. (1) of which
provides that when the Government is satisfied that any
particular land is needed for a public purpose, or for a
company, a declaration should be made to that effect and
such declaration should be published in the Official
Gazette. Sub-section (2) specifies the matters including
the purpose for which the land is needed which are to be set
out in the declaration. Subsection (3) makes the
declaration conclusive evidence of the fact that the land is
needed for a public purpose or for a company, as the case
may be. Section 17 of the Act confers special powers on the
Government which are exercisable in cases of emergency.
Sub-section (4) thereof provides
796
that in those cases which fall under sub-s. (1) or Sub-s.
(2) the appropriate Government may direct that the
provisions of s. 5A of the Act shall not apply and also
empowers the Government to make a declaration under s.6 in
respect of the land to be acquired at any time after the
publication of the. notification under sub-s. (1) of s.4.
These are the provisions which have a bearing on the point
under consideration.
It is clear from these provisions that the object of the law
is to empower Government to acquire land only for a public
purpose or for a company, and, where it is for a company the
acquisition is subject to the provisions of Part VII. As
has been pointed out by this Court in R. L. Arora v. The
State of Uttar Pradesh (1) the acquisition for a company
contemplated by Part VII is confined only to cases where the
Government is satisfied that the purpose of obtaining the
land is erection of dwelling houses for workmen employed by
the company or for the provision of amenities directly
connected therewith or for the construction of some work
which is likely to prove directly useful to the public.
After a notification under sub.s. (1) of s.4 is published a
person interested in the land is entitled to object to the
acquisition. That objection may be raised on any ground as
for instance that the land is not in fact needed at all for
any purpose or that it is not suitable for the purpose for
which it is, sought to be acquired or that the purpose is
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 14 of 33
not a public purpose or what is said to be a company is not
a company and so on. Finality is attached to the decision
of the Government which ultimately has to decide such
objections. Then follows s.6 which enables the Government
to make a declaration provided that it is satisfied that a
particular land is needed for a, public purpose or for a
company. No doubt,
(1) (1962) Supp. 2 S.C.R. 149.
797
it is open to the State Government in an emergency by
exercisingits powers under sub. s. (4) of s. 17, to say that
the provisions of s. 5A would not apply. But for construing
the provisions of s. 6 it would be relevant to bear in mind
that section. The scheme of the Act is that normally the
provisions of s. 5A have to be complied with. Where, in
pursuance of the provisions, objections are lodged, these
objections will have to be decided by the Government. For
deciding them the Government will have before it the
Collector’s proceedings. It would, therefore, be clear that
the declaration that a particular land is needed for a
public purpose or for a company is not to be made by the
Government arbitrarily, but on the basis of material placed
before it by the Collector. The provisions of sub.s. (2) of
s. 5A make the decision of the Government on the objections
final while those of sub-s (1) of s. 6 enable the
Government to arrive at it; satisfaction. Sub-section (3)
of s. 6 goes further and says that such a declaration shall
be conclusive evidence that the land is needed for a public
purpose or for a company.
It is, however, argued by learned counsel that the
conclusiveness or finality attached to the declaration of
Government is only as regards the fact that the land is
"needed" but not as regards the question that the purpose
for which the land is needed is in fact a public purpose or
what is said to be a company is really a company. Sub-
section (1) does not effect a dichotomy between "need" and
"Public purpose or a company". There is no justification
for making such a dichotomy. By making it, not only will
the language of the section be strained but the purpose of
the law will be stultified. The expression must be regarded
as one whole and the declaration held to be with respect to
both the elements of the expression.
798
The Government has to be satisfied about both the elements
contained in the expression "needed for a public purpose or
a company". Where it is so satisfied, it is entitled to
make a declaration. Once such a declaration is made subs.
(3) invests it with conclusiveness. That con-, elusiveness
is not merely regarding the fact that the Government is
satisfied but also with regard to the question that the land
is needed for a public purpose or is needed for a company,
as the case may be. Then again, the conclusiveness must
necessarily attach not merely to the need but also to the
question whether the purpose is a public purpose or what is
said to be a company is a company. There can be no "need"
in the abstract. It must be a need for a ’public purpose’
or for a company. As we have already stated the law permits
acquisition only when there is a public purpose or when the
land is needed for a company for the purposes set out in s.
40 of the Act. Therefore, it would be unreasonable to say
that the conclusiveness would attach only to a need and not
to the fact that that need is for a public purpose or for a
company. No land can be acquired under the Act unless the
need is for one or the other purpose and, therefore it will
be futile to give conclusiveness merely to the question of
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 15 of 33
need dissociated from the question of public purpose or the
purpose of a company. Upon the plain language of the
relevant provisions it is riot possible to accept the
contention put forward by learned counsel.
Learned counsel put the matter in a slightly different way
and said that s. 6 (3) presupposes that the jurisdictional
fact exists, namely, that there is a public purpose or the
purpose of a company behind the acquisition and, therefore,
the question whether it exists or not is justiciable. The
Act has empowered the Government to determine the question
of the need of land for a public
799
purpose or for a company and the jurisdiction conferred upon
it to do so is not made conditional upon the existence of a
collateral or extraneous fact. It is the existence of the
need for a public purpose which gives jurisdiction to the
Government to make a declaration under s. 6 (1) and makes it
the sole judge whether there is in fact a need and whether
the purpose for which there is that need is a public
purpose. The provisions of sub-s. (3) preclude a court from
ascertaining whether either of these ingredients of the
declaration exists.
It is, however, said that that does not mean that in so far
as the meaning to be given to the expression public purpose
is concerned the courts have no power whatsoever. In this
connection the decision of the Privy Council in Hamabai
Framjee Petit v. Secretary of State for India (1) was refer-
red to. In that case certain land in Malabar Hill in Bombay
was being acquired by the Government of Bombay for
constructing residences for Government officers and the
Acquisition was objected to by the lessee of the land on the
ground that the land was not being taken or made available
to the public at large and, therefore, the acquisition was
not for a public purpose. When the matter went up before
the High Court Batchelor, J., observed:
"General definitions ’are, I think, rather to
be avoided where the avoidance is possible,
and I make no attempt to define precisely the
extent of the phrase,public purposes’ in the
lease; it is enough to say that, in my
opinion, the phrase, whatever else it may
mean, must include a purpose, that is, an
object or aim, in which the general interest
of the community., as opposed to, the
X X
particular
1)b P
(1914) L.R. 42 IA. 44.
800
interest of individuals, is directly and
vitally concerned."
In that case what was being considered was a re-entry clause
in a lease deed and not provisions of the Land Acquisition
Act. That clause left it absolutely to the lessor, the East
India Company to say whether the possession should be
resumed by it if the land was required for a public,
purpose. It was in this context that the question whether
the land was needed for a public purpose was considered.
The argument before the Privy Council rested upon the view
that there cannot be a ’public purpose’ in taking land if
that land, when taken, is not in some way or other made,
available to the public at large. Rejecting it they held
that the true view is that expressed by Batchelor, J., and
observed:
"That being so, all that remains is to
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 16 of 33
determine whether the purpose here is a
purpose in which the general interest of the
community is concerned. Prima facie the
Government are good judges of that. They are
not absolute judges. They cannot say ,,sic
volo sic jebeo, but at least a Court would not
easily hold them to be wrong. But here, so
far from holding them to be wrong, the whole
of the learned judges, who are thoroughly
conversant with the conditions of Indian life,
say that they are satisfied that the scheme is
one which will redound to public benefit by
helping the Government to maintain the
efficiency of its servants. From such a
conclusion their Lordships would be slow to
differ, and upon its own statement it commends
itself to their judgment".
Mr. Pathak strongly relied on these observations and said
that the Privy Council have held that the matter is
justiciable. It is enough to say
801
that that was not a case under the Land Acquisition Act and,
therefore, conclusiveness did not attach itself to the
satisfaction of the Government that a particular purpose
fell within the concept of public purpose.
Mr. Pathak then contended that the question as to the
meaning to be given to the phrase ’public purpose’ is not
given conclusiveness by sub-s. (3) of s. 6. According to him
all that sub-s. (3) of s. 6 says is that the Government’s
declaration that particular land is needed for a public
purpose or a company shall be conclusive and that it does
not say that the Government is empowered to define what is a
public purpose and then say that the particular purpose
falls within that definition. As already stated no attempt
has been made in the Act to define public purpose in a
compendious way. Public purpose is bound to vary with the
times and the prevailing conditions in a given locality and,
therefore, it would not be a practical proposition even to
attempt a comprehensive definition of it. It is because of
this that the legislature has left it to the Government to
say what is a public purpose and also to declare the need of
a given and for a public purpose.
It was contended on the basis of the decision of this Court
in R. L. Arora v. The State of U. P. (1) that-the Courts
have power to consider whether the purpose for which land is
being acquired is a public purpose. In that case land was
being acquired, as already stated, for a company and the
real question which arose for consideration was, what is the
meaning to be attached to the words "useful to the public"
occurring in cl. (b) of sub-s. (1) of s. 40 of the Act. The
land was required by the company to enable it to establish
its works and it was contended before this Court that the
products manufactured
(1) [1962] Supp. 2S.C.R.149
802
by the company will be useful to the public in general and,
therefore, the acquisition would be covered by cl. (b) of
sub-s. (1) of s. 40. Negativing this contention Wanchoo,
J., who spoke for the Court observed :
"It is true that it is for the Government to
be satisfied that the work to be constructed
will be useful to the public but this does
not mean that it is the Government which has
the right to interpret the words used ins. 40
(1) (b)......It is the Court which has to
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 17 of 33
interpret what those words mean. After the
court has interpreted these words, it is the
Government which has to carry out the object
of ss. 40 and 41 to its satisfaction. The
Government cannot say that ss. 40 and 41 mean
this and further say that they are satisfied
that the meaning they have given to the
relevant words in these sections has been
carried out in the terms of the agreement
provided by them.................The
Government cannot both give meaning to the
words and also say that they are satisfied on
the meaning given by them. The meaning has to
be given by the Court and it is only
thereafter that the Government’s satisfaction
may not be open to challenge We have already
indicated what these words mean and if it
plainly appears that the Government are
satisfied as a result of giving some other
meaning to the words, the satisfaction of the
Government is of no use, for then they are not
satisfied about what they should be satisfied.
In the present case the Government seems to
have taken a wrong view that so long as the
product of the works is useful to the public
and so long as the public is entitled to go
upon the works in the way of
Body text Uf tQ34pe4-˜
803
business, that is all that is required by the relevant words
in as. 40 and 41’ required
It was no doubt argued before the Court that the declaration
made by the Government under s. 6 (1) that the land was
needed for a company is conclusive and, therefore, the
question as to the actual purpose of the acquisition is not
justiciable. This Court pointed out that s. 6 (3) makes the
declaration under s. 6 (1) conclusive evidence of the fact
that the land is needed for a public purpose or for a
company and that as the declaration stated that the land was
needed for a company and that fact was not disputed by the
parties, the provisions of s. 6 (3) were of no assistance.
We may point out that even according to that decision
conclusiveness attaches itself to the declaration that the.
land is required for a public purpose and. therefore,.
instead of assisting the petitioners it in fact assists the
respondents. No doubt, in so far as an acquisition for a
company is concerned Part VII requires that before a
declaration under s. 6 (1) is made the Government should be
satisfied that the land is required for one of the two
purposes set out in s. 40 (1) of the Act. The Government
can consent to the making of a declaration under a. 6 (1)
after it is satisfied under s. 41 about the fact that the
land is required for a company fort the purposes set out in
el. (a) and (b) of that section. But the declaration made
thereafter is confined only to one matter and that is that
the land is required for a company and nothing more. The
question whether in fact the land is required by the company
for the purposes set out in el. (a) and (b) of s. 40 (1) is
not germane to the declaration. No doubt the power of the
Government to make a declaration with respect to an
acquisition for a company is circumscribed and, therefore,
the Government is expected to exercise it with due regard to
the limitation placed upon it. But it does not follow that
sub-a. (3)
804
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 18 of 33
of S. 6 makes the declaration conclusive evidence not only
of the fact that the land is required for a Company but also
of the fact that the land is required by a company for a
purpose specified in s. 40 (1) of the Act. The observations
made by Wanchoo, J., therefore do not assist the
petitioners.
Reliance was then placed on two decisions of this Court in
which the meaning of the expression "public purpose" is
considered. One is Babu Barkya Thakur v. The State of
Bombay (1). There this Court observed
"It will thus be noticed that the expression
’public purpose’ has been used in its generic
sense of including any purpose in which even a
fraction of the community may be interested or
by which it may be benefited."
Later in the same judgment this Court pointed out that where
a large section of the community is concerned its welfare is
a matter of public concern. The other is Pandit Jhandu Lal
v. The Slate of Punjab (2). There this Court has pointed
out that the purpose of public utility referred to in ss. 40
and 41 are akin to the public purpose.
No doubt in these decisions this Court stated what, broadly
speaking, the expression ’public purpose’ means. But in
neither case the question arose for consideration as to
whether the meaning to be given to the expression ’public
purpose’ is justiciable.
Now whether in a particular case the purpose for which land
is needed is a public purpose or not is for the. State
Government to be satisfied about. If the purpose for which
the land is being acquired by the State is within the
legislative competence of the State the declaration of the
Government will be
(1) [1961] 1. S.C.R. 126,
(2) [1961]2.SC.R.459.
805
final subject, however, to one exception. That exception is
that if there is a colourable exercise of power the
declaration will be open to challenge at the instance of the
aggrieved party. The power committed to the Government by
the Act is a limited power in the sense that it can be
exercised only where there is a public purpose, leaving
aside for a moment the purpose of a company. If it appears
that what the Government is satisfied about is not a public
purpose but a private purpose or no purpose act all the
action of the Government would be colourable as not being
relatable to the power conferred upon it by the Act and its
declaration will be a nullity. Subject to this exception
the declaration of the Government will be final.
A number of decisions were cited before us by the learned
Advocate-General in support of the contention that the
declaration of the Government is final. One of those
decisions is Wijeyesekera v. Festing (1). In that case
dealing with Ceylon Ordinance No. 3 of 1876 (Acquisition of
Land Ordinance, (Ceylon), 1876) which incidentally did not
contain a provision similar to that of sub-s. (3) of s. 6,
their Lordships observed:
"The whole frame of the ordinance shows that
what the District Court is concerned with is
the assessment of compensation, but their
Lordships do not desire to- rest their opinion
that the decision of the Governor is final
merely upon the question. of the Court before
which the question is raised. It appears to
their Lordships that the decision of the
Governor that the land is wanted for public
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 19 of 33
purposes is final, and was intended to be
final, and could not be questioned in any
Court."
There, the land was required :(or a road and the contention
was that the Government did not take the opinion of the
Surveyor General as to its fitness
(1) [1919] A.C. 646.
806
for such purpose. On this ground it was contended that the
Governor’s declaration could be questioned. But this was
negatived by the Privy Council. Following this decision in
Vadlapatla Suryanarayana v. The Province of Madras(1) a Full
Bench of the Madras High Court held that a declaration by
the Provincial Government under s. 6(1) of the Act that
certain lands were required for a public purpose is final
and, where there is no charge against the Provincial
Government that it had acted in fraud of its powers its
action in directing the acquisition cannot be challenged in
a Court of law. Similar view has been taken in Samruddin
Sheikh v. Sub-Divisional Officer.(2) ; V. Gopalakrishna v.
The Secretary, Board of Revenue, Madras (3); S. Jagannadha
Rao v. The State of Andhra Pradesh (4) ; Secretary of State
for India in Council v. Akbar Ali (5). Several other
decisions to the same effect, some of them post
Constitution, were also mentioned by the learned Advocate-
General, which take the same view as in these decisions.
Not a single decision was however, brought to our notice in
which it has been held that the question as to what is a
public purpose or whether it exists can be inquired into by
the Courts even in the absence of colourable exercise of
power, because s. 6(3) has become void under Art. 13(2) of
the Constitution.
It was next contended that sub-s. (3) of s. 6 cannot stand
in the way in a proceeding under Art. 226 or under Art.
32 of the Constitution and in support of this argument
reliance was placed upon the decision in Chudalmuthu Pillai
v. State (6) ; Maharaja Luchmeshwar Singh v. Chairman of
the Darbhanga Municipality (7);
(1) I.L R [1916] Mad. 153.(2) A.I.R (1954) Assam 81.
(3) A.I.R 1954 Mad.362.(4) A I.R 196O A.P. 343.
(5) (1923) I.L.R. 45 All. 413. (6 ) I.L. R. [1932] Tra.
Cochin. 488,
(7) (1890) L.R. 17 nI.A. 90.
807
Rajindra Kumar Ruia v. Government of West Bengal (1) ; Major
S. Arjan Singh v. State of Punjab (2) ;. In the first
mentioned case it was contended that the order was actuated
by mala fides and also that there were various
irregularities in the proceedings. As we have already
indicated, if the declaration is vitiated by fraud, then the
declaration is itself bad and what is bad cannot be
protected by sub-s. (3) of s. 6. In the next case the act of
the Court of Wards in handing over the ward’s lands for a
nominal consideration for a public- purpose was challenged
in a suit. The challenge was upheld by the Privy Council on
the ground that lawful possession could only be taken by the
State in strict compliance with the provisions of the Land
Acquisition Act. The question raised here did not arise for
consideration in that case. In the other two cases the
declaration was challenged under Art. 226 and in both the
cases the challenge failed. In the first of the two latter
mentioned case it failed on the ground that there was no
fraud and in the second on the ground that the provisions of
sub.s. (3) of s. 6 precluded the court from challenging the
validity of the declaration. None of these cases, therefore
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 20 of 33
support the contention of the petitioners.
Moreover we are not concerned here with the powers of the
High Court under Art. 226 but with those of this Court. It
is said, however that the bar created by s. 6(3) would not
stand in the way of this Court while dealing with a petition
under Art. 32 and, therefore, it is open to us to ascertain
whether an acquisition is for a public purpose or not.
While it is true that the powers of this Court cannot be
taken away by any law which may hereafter be made unless the
Constitution itself is amended we are here faced with a
provision of law which is a pre-Constitutional law and which
is protected by the
(1) A.I.R. 1952. Cal. 573. (2) I.L.R.[1958] Punjab 1451.
808
Constitution-to the extent indicated in Art. 31(5)(a) and an
I attack on its validity on the ground that it infringes the
right guaranteed by Art. 19(1)(f) has failed. Therefore-it
is a good and valid law and the restriction placed by it on
the powers of this Court under Art. 32 must operate.
Though we are of the opinion that the courts are not
entitled to go behind the declaration of the Government to
the effect that a particular purpose for which the land is
being acquired is a public purpose we must emphasise that
the declaration of the Government must be relatable to a
public purpose as distinct from a purely’ private purpose.
If the purpose for which the acquisition is being made is
not relatable to public purpose then a question may well
arise whether in making the declaration there has been, on
the part of the Government a fraud on the power conferred
upon it by the Act. In other words the question would. then
arise whether that declaration was merely a colourable
exercise of the power conferred by the Act, and, therefore,
the declaration is open to challenge at the instance of the
party aggrieved. To such a declaration the protection of
6(3) will not extend. For, the question whether a
particular action was the result of a fraud or not is always
justiciable, provisions such as s. 6(3) notwithstanding.
We were referred by the learned Advocate General to a
recent decision of the House of Lords in Smith v. East Elloe
Rural District Council (1) to which reference was made by a
learned Advocate General. In that case their Lordships were
considering the Acquisition of Land (Authorisation of Pro-
cedure) Act, 1946, (9 and 10 Geo. 6, c. 49), Sch. 1, Pt.
IV, paras 15 and 16. Paragraph 15 (1) of Part IV, Sch. 1
to the Act provides as follows :
"If any person aggrieved by a compulsory
(1) [1956] A.C. 736.
809
purchase older desires to question the
validity thereof..... on the ground that the
authorisation of compulsory purchase thereby
granted is not empowered to be granted under
this Act.......... he may, within six weeks
from the date on which notice of the
confirmation or making of the order.... is
first published...... make an application to
the High Court........"
Paragraph 16 provides as follows :
"Subject to the provisions of the last
foregoing paragraph, a compulsory purchase
order.... shall not.... be questioned in any
legal proceedings whatsoever...... "
The land having been made the subject of compulsory purchase
the owner brought an action in which among other things, a
declaration was added that the order was made and confirmed
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 21 of 33
wrongfully and in bad faith and that the clerk acted
wrongfully and in bad faith in procuring its order and
confirmation. The House of Lords held by majority that the
action could not proceed except against the clerk for
damages because the plain prohibited in paragraph 16
precluded the Court challenging the validity of the order.
They also held that paragraph 15 gave no opportunity to a
person aggrieved to question the validity of a compulsory
purchase order on the ground that it was made or confirmed
in bad faith. As we have already said the condition for the
exercise of the powers by the State Government is the
existence of a public purpose (or the purpose of a company)
and if the Government makes a declaration under s. 6(1) in
fraud of the powers conferred upon it by that section the
satisfaction on which the declaration is made is not about a
matter with respect to which it is required to be satisfied
by the ’Provision and, therefore, its declaration is open to
challenge as being without any legal effect. We
810
are not prepared to go as far as the House of Lords in the
above case.
This brings us to the second argument advanced before us on
behalf of the petitioners. The learned counsel contends
that there could be no acquisition for a public purpose
unless the Government had made a contribution for the
acquisition at public expense. According to him the
acquisition in question was merely for the benefit of a
company and that the action of the Government was only a
colourable exercise by it of its power to acquire land for a
public purpose. The contention is that before making a
declaration under sub-s. (1) of s. 6 the Government ought to
have taken a decision that it will contribute towards the
acquisition. In the case before us no such decision was
taken by the Government till ;September 29, 1961, that is.
just one day after this writ petition was admitted by this
Court and stay order issued by it. It is then said that the
contribution of the Government towards the cost of
acquisition being a very small fraction of the total
probable cost of acquisition the inference must be that the
acquisition was not even partly at public expense and,
therefore, the declaration was a colourable exercise of the
power conferred by law. Then it is said that not only does
the declaration omit to state that the contribution of the
State towards the cost of acquisition was to be Rs. 100 only
but also omits to mention that what was decided was that the
Government was to bear only a part, of the cost of
acquisition and not the whole of it. The notification is
said to be thus misleading and to create the impression that
the entire cost of the acquisition is to come out of the
public exchequer. Finally it is contended that the
establishment of an industry by a private party for
manufacturing refrigeration equipment cannot fall within the
meaning of the expression ’Public purpose’.
811
It is no doubt true that the financial sanction for the
contribution of Re. 100 as part of the expenses for
acquisition was accorded by the Finance Department on
September 29, 1961. No doubt also that a day prior to the
according of sanction this petition had been admitted by
this Court and a stay order issued. But from these two
circumstances it would not be reasonable to draw the infer-
ence that the declaration made by the Government was a
colourable exercise of its power. The- provisions of sub-s.
(1) of a. 6, however, do not require that the notification
made thereunder must set out the fact that the Government
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 22 of 33
had decided to pay a part of the expenses of acquisition or
even to state the extent to which the Government is prepared
to make part contribution to the cost of acquisition.
It is then contended that before the Government could spend
any money from the public exchequer for acquiring land a
provision his to be made in the budget and the absence of
such provision would be a circumstance relevant for
consideration. It is sufficient to say that the absence of
a provision in the budget in respect of the cost of
acquisition, whole or part, cannot affect the validity of
the declaration and that if Government does spend some money
without allotment in the budget, its expenditure may perhaps
entitle the Accountant General to raise an audit objection
or may enable the Public Accounts Committee of the State
Legislature to criticism the Government. But that is all.
Again, where the expenditure is of a small amount like Rs.
100 it may he possible for the Government to make payment
from Contingencies and thus avoid objections of this kind.
Whatever that may be, these are not circumstances which
would suffice to show that the declaration was colourable.
It was stated at the bar by the learned Advocate-General
that the entire scheme of esta-
812
blishing a refrigeration factory in Punjab was examined at
various stages and at different levels of Government as well
as by different ministries and it was then decided to make a
part contribution towards the cost of acquisition from
public funds. As required by the Financial Rules the consent
of the Finance Department had to be obtained for this
purpose. This particular stage occupied considerable time
and that is why there was a delay in according sanction.
The statement of the learned Advocate-General was not
challenged on behalf of the petitioners. Moreover the
declaration under sub-a. (1) of s. 6 is clear on the point
that the land is being acquired at public expense, and the
provisions of sub-a. (3) of a. 6 precluded a Court from
going behind such a declaration unless it is shown that the
Government has in fact decided not to contribute any funds
out of the public revenues for that purpose. For, if the
Government had in fact taken a decision of that kind then
the exercise of the power to make an acquisition would be
open to challenge as being colourable.
Then it is contended that the contribution by the State
towards the cost of acquisition must be substantial and not
merely nominal or token as in this case. The argument is
that though the law permits acquisition for a public purpose
to be made by the State by contributing only a part of the
cost of acquisition that part cannot be a particle and in
this connection reliance was placed on the decision in
Chatterton v. Cave (1) which was followed in Ponnaia v.
Secretary of State (2). In the latter case the High Court
of Madras observed that ,,the Legislature, when they
provided that a part of the compensation should be paid from
public revenues, did not mean that this condition would be
satisfied-by payment of a particle, e. g. one anna in Rs. 5,
985". In that case land was being acquired
(1) (1878) 3 App. Cas. 483, 491, 492. (2) A. I. R. 1926
Mad. 1099.
813
for making a road between two villages in Ramnad District.
A sum of Rs. 5, 985 was required for the acquisition. Out
of this amount only one anna was agreed to be contributed by
the Government and it was contended on its behalf that this
contribution satisfied the requirements of s. 6 of the Act.
It was also contended that the declaration made under sub-s.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 23 of 33
(1) of s. 6 could not be challenged in view of the
provisions of sub-s. (3) of a. 6 and reliance was placed on
the decision in Wijeyesekara v. Festing (1). According to
the High Court the fast that the Government’s share in the
cost of acquisition being 1/90,000 part of the amount, there
was no real and bona fide compliance with the terms of the
section and that this was an indication of the illusory
character of the object for which the provisions of the Act
were being made use of. The High Court then referred to the
decision in Chatterton’s case ( 2 ) and pointed out that the
House of Lords were averse to putting an interpretation on
the words "or part thereof" occurring in the Dramatic
Copyright Act, (3 & 4 William IV, c. 15) as would make a
part to mean a particle. The High Court also referred to
the decision in Maharaja Luchmemar Singh’s case (3 ) and
held that the acquisition was a colourable exercise of the
power conferred by the Act.
This decision was not followed by the same High Court in
Senja Naicken v. Secretary of State (4) where it was held
that the State’s contribution of one anna out of Rs. 926-8-6
for acquiring land for a road, Rs. 926-7-6 having been
contributed by the ryots, was sufficient compliance with s.
6 (1) of the Act. Both these decisions came up for
consideration in Vadlapatla Suryanarayanas case (5) and
there Ponnaia’s case (3) was over-ruled and the view taken
in Senja Naickens case (4) was approved.
(1) (1926) I.L.R. 50 Mad. 308.(2) (1878) 3 App. Cas. 483.
491, 492
(3) (1890) L.R. 17 I.A. 90.(4) (1926) 1 L.R. 6o mad. 308.
(5) I.L.R. [1946] Mad, 153.(6) A. 1. R. 1926 Mad. 1099.
814
Chatterton’s case (1) was a case of infringement of
copyright where two plays had been adapted from a common
source by the parties to the litigation. In that case it
was accepted before the Court that the Dramatic Copyright
Act protected ,parts" of dramatic work and prohibited their
use by persons other than the proprietor of the Copyright.
It was pointed out that in the case of ordinary copyright of
published work the protection was restricted only to the
whole of the work and did not extend to portions of those
work. The Dramatic Copyright Act also contained a provision
directing that infringement of the copyright would entitle
the proprietor to damages of not less than 40 shillings. It
was suggested that these differences indicated an intention
to prevent the invasion of the dramatic copyright indepen-
dently of the quantity or materiality of the portion of
dialogue or dramatic incident proved to have been copied by
another. Dealing with this argument Lord Hatherley
observed:
"Now it appears to me, my Lords, that this
argument goes much too far. As was said by
the counsel for the respondent, the appellant
would wish to read the word ’part’ in the
Dramatic Copyright Act as ’particle’, so that
the crowing of the cook in Hamlet’, or the
introduction of a line in the dialogue, might
be held to be an invasion of the copyright
entitling plaintiff to 40s. damages and
consequently, as the law stood I believe at
the time of the passing of the statute of 3 &
4 Will. 4, to the costs of his action," (pp.
491-2)
Then after pointing out that while in the case of an
ordinary copyright of published works a fair use made by
others would not amount to a wrong
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 24 of 33
(1) 1878) 3 App. Cas. 483, 491,492.
815
justifying an action at law, the position of dramatic
performance is not the same he observed
"They are not intended to be repeated by
others or to be used in such a way as a book
may be used, but still the principle de
minimis non curat lex applies to a supposed
wrong in taking a part of dramatic works as
well as in reproducting a part of a book"’.
(p. 492)
Finally he observed that the parts which were so taken were
neither substantial nor material parts and as it was
impossible to say that damage had accrued to the plaintiff
from such taking, his action must fail.
Lord O’Hagan observed
" "Part", as was observed, is not necessarily
the same as particle’, and there may be a
taking so minute in its extent and so trifling
in its nature as not to incur the statutory
liability."
It is clear, therefore, that the analogy of Chatterton’s
case (1) cannot possibly apply to a case under the Act. As
was pointed out in Senja Naicken’s case (2) :
"Admittedly both of the litigants had derived
their compositions from a common source and it
stands to reason that before you can compel a
man to pay damages for stealing the product of
your brain, time and labour, you must be able
to point out that any resemblance between his
production and yours is not merely accidental
but is a designed theft of the product of our
brain. Otherwise...... one might go to the
absurdity of objecting to a man using the same
words
(1) (1878) 3 App Cas. 483,491 492.
(2) (1826) I.L.R. 50 Mad. So.
816
though in a different collocation as you have
done." .
.lm0
With these observations we agree.
Now, as regards Maharaja Luchmeswar Singh’s
case (1). The facts were their. The
plaintiff’s land was under the management of
the Court of Wards during his minority. A
notification under s. 6( 1) of the Land
Acquisition Act, 1870 was made with respect to
certain land belonging to the plaintiff for
being acquired by the Government at the
expense of the Darbhanga Municipality for a
public purpose, that is, construction of a
public ghat or landing place in the town of
Darbhanga. But instead of complying with the
provisions of the Land Acquisition Act and
enquiring to the value of the land, the
Collector who was the Chairman of the
Municipality and also a representative of the
Court of Wards took possession of the land and
handed it over to the municipality. The
compensation paid to the plaintiff was Re. 1/-
, an amount agreed to by the Manager. The
plaintiff, after attaining majority,
instituted a suit for possession of land and
for mesne profits. His suit was dismissed by
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 25 of 33
the courts below and he preferred an appeal
before the Judical Committee of the Privy
Council. Allowing the appeal, their Lordships
observed :
"The offer and acceptance of the rupee was a
colourable attempt to obtain a title under the
Land Acquisition Act without paying for the
land........"
How this case could at all have any bearing upon the point
which arose for consideration in Ponnaia’s case we fail to
see. This case is also relied on before us on behalf of the
petitioners and we have referred to it earlier in this
Judgment. It has nothing whatsoever to do with the question
of contribution by the State to-wards the cost of
acquisition.
(1) (1890) L.R. 17 I.A. 90.
(2) A.I.R. 1926 Mad. 1099.
817
We would like to add that the view taken in Senja Naicken’s
case (1) has been followed by the various High Courts in
India. On the basis of the correctness of that view the
State Governments have been acquiring private properties all
over the country by contributing only token amounts towards
the cost of acquisition. Titles to many such properties
would be unsettled if we were now to take the view that
’partly at public expense’ means substantially at public
expense. Therefore, on the principle of state decision the
view taken in Senja Naicken’s case(1) should not be
disturbed. We would, however, guard ourselves against being
understood to say that a token contribution by the State
towards the cost of acquisition will be sufficient
compliance with the law in each and every case. Whether
such contribution meets the requirements of the law would
depend upon the facts of every case. Indeed the fact that
the State’s Contribution is nominal may well indicate, in
particular circumstances that the action of the State was a
colourable exercise of power. In our opinion ,part’ does
not necessarily mean a substantial part and that it will be
open to the Court in every case which comes up before it to
examine whether the contribution made by the State satisfies
the requirement of the law. In this case we are satisfied
that it satisfies the requirement of law. What is next to
be considered is whether the acquisition was only for a
company because the compensation was to come almost entirely
out of its coffers and, therefore, it was in reality for a
private 5 purpose as opposed to public purpose. In other
words, the question is whether there was on the part of the
Government a colourable exercise of power. Elaborating the
point it is said that the establishment of a factory for
manufacturing refrigeration equipment is nothing but an
ordinary commercial venture and can by no stretch of
imagination fall within the well-accepted
818
meaning of the expression ’public purpose’, that even if it
were to fall within that expression the factory is to be
established not by the Government, nor by Government
participation but solely by the respondent No. 6, a public
limited concern and that, therefore, the concern could
acquire land for such a purpose only after complying with
the provisions of Part VII and that the use of the
provisions of a.6(1) is merely a colourable device to enable
the respondent No. 6 to do something, which, under terms of
s. 6(1), could not be done.
"Public purpose" as explained by this Court in Babu Barkaya
Thakur’s case (1) means a purpose which is beneficial to the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 26 of 33
community. But whether a particular purpose is beneficial
or is likely to be beneficial to the community or not is a
matter primarily for the satisfaction of the State Govern-
ment.. In the notification under s. 6(1) it has been stated
that the IInd is being acquired for a public purpose,
namely, for setting up a factory for manufacturing various
ranges of refrigeration compressors and ancillary equipment.
It was vehemently argued before us that manufacture of
refrigeration equipment cannot be regarded as beneficial to
the community in the real sense of the word and that such
equipment will at the most enable articles of luxury to be
produced. But the State Government has taken the view that
the manufacture of these articles is for the benefit of the
community. No materials have been placed before us from
which we could infer that the view of the Government, is
perverse or that its action based on it constitutes a fraud
on its power to acquire land or is a colourable exercise by
it of such power.
Further, the notification itself sets out the purpose, for
which the land is being acquired. That purpose, if we may
recall, is to set up a factory for the manufacture of
refrigeration compressors and
(1) (1961) 1 S.C.R. 128.
819
ancillary equipment. The importance of the under’taking to
a State such as the punjab which has a ,surplus of fruit,
dairy products etc. the general effect of the establishment
of this factory on foreign exchange resources, spread of
education, relieving the pressure on unemployment etc., have
been set out in the affidavit of the respondent and their
substantee appears in the earlier part of this
judgment.The affidavits have not been controverted and we
have, therefore, no hesitation in acting upon them.
On the face of it, therefore, bringing into existence a
factory of this kind would be a purpose beneficial to the
public even though that is a private venture. As has
already been pointed out, facilities for providing
refrigeration are regarded in modern times as public
utilities. All the greater reason.- therefore, that a
factory which manufactures essential equipment for
establishing public utilities must be regarded as an
undertaking carrying out a public purpose. It is well
established in the United States. of America that the power
of eminent domain can be exercised for establishing public
utilities. Such a power could, therefore, be exercised for
establishing a factory for manufacturing equipment upon
which a public utility depends. It is, therefore, clear
that quite apart from the provisions of sub-s. (3) of s. 6
the notification of the State Government under s. 6 cannot
be successfully challenged on the ground that the object of
the acquisition is not carry out a public purpose. We
cannot, therefore, accept the petitioner’s contention that
the action of the Government in making the notification
under sub-s. (1) of s. 6 was a colourable exercise of the
power conferred by the Act.
The next argument to be considered is whether there has been
a discrimination against the petitioners. They claim that
as they intend to establish a factory for manufacturing
paper which
820
is also an article useful to the community they are as good
an industrial concern as the respondent No. 6 and the State
Government in taking away land from them and giving it to
respondent No. 6 is practising discrimination against them.
In the first place it is denied on behalf of the respondents
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 27 of 33
that the petitioners are going to establish a paper factory.
It is not disputed that no new factory can be established
without obtaining a licence from the appropriate authority
under the Industries Development and Regulation Act, 1951,
and that the petitioners do not hold any licence of this
kind. According to the petitioners, however; they had
entered into an agreement with the firm of Messrs. R. S.
Madhoram & Sons for establishing such a factory and that in
collaboration with them they propose to establish a factory
on the lands which are now being acquired. It is true that
a licence for erecting a paper factory was granted to
Messrs. R. S. Madhoram and Sons but the location of that
factory is to be in Uttar Pradesh and not in the State of
Punjab. Without therefore, obtaining the approval of the
appropriate authority the location of the factory could not
be shifted to the land in question which, as already stated,
is situate in the State of Punjab. Moreover this licence
has since been cancelled on the ground that Messrs. R. S.
Madhoram and Sons have taken no steps so far for
establishing a paper factory. It is necessary to mention
that the petitioners allege that this cancellation was
procured by the respondents with the object of impeding the
present petitioners. With that, however, we, need not
concern ourselves because that licence as it stood on the
date of the petitions did riot entitle Messrs. R. S.
Madhoram and Sons to establish a factory in the State of
Punjab.
821
Apart from that it is always open to the State to fix
priorities amongst public utilities of different kinds,
bearing in mind the needs of the State the existing
facilities and other relevant factors. In the State like
the Punjab where there is a large surplus of fruit and dairy
products there is need for preserving it. There are already
in existence a number of cold storages in that State. The
Government would, therefore, be acting reason. ably in
giving priority to a factory for manufacturing refrigeration
equipment which would be available for replacement in these
storages and which would also be available for equipping new
cold storages.
Apart from this it if; for the State Government to say which
particular industry may be regarded as beneficial to the
public and to decide that its establishment would serve a
public purpose. No question of discrimination would, there-
fore, arise merely by reason of the fact that Government has
declared that the establishment of a particular industry is
a public purpose. The challenge to the notification based
on Art. 14 of the Constitution must, therefore, fail.
It is the last and final contention of the petitioners in
these petitions that the notifications under ss. 4 and 6
cannot be made simultaneously and that since both the
notifications were published in the Gazette of the same
date, that is, August 25, 1961, the provisions of law have
not been complied with. The argument is that the Act takes
away from a person his inherent right to hold and enjoy that
property and, therefore, the exercise of the statutory power
by the State to take away such property for a public purpose
by paying compensation must be subject to the meticulous
observance of every provision of law entitling it to make
the acquisition. It is pointed out that under sub.s.
822
a particular land "is likely to be needed for a public
purpose". Thereafter under s. 5A a person interested in.
the land has a right to object to the acquisition and the
whole question has to be finally considered and decided by
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 28 of 33
the Government after hearing such person. It is only
thereafter that in a normal case the Government is entitled
to make a notification under sub-s. (1) of s, 6 declaring
that it is satisfied "after considering the report, if any,
made under s. 5A, sub-s. (2) " that the land is required for
a public purpose. This is the sequence in which the
notifications have to be made. The reason why the sequence
has to be followed is to make it clear that the Government
has applied its mind to all the relevant facts and then come
to a decision or arrived at its satisfaction even in a case
where the provisions of s. 5A need not be complied with.
Undoubtedly the law requires that notification under sub-s.
(1) of s. 6 must be made .only after the Government is
satisfied that a particular land is required for a public
purpose. Undoubtedly also where the Government has not
directed under sub-s. (4) of s. 17 that the provisions of s.
5A Deed not be complied with the two notifications, that is,
under sub-s. (1) of s. 4 and sub-s. (1) of s. 6 cannot be
made simultaneously. But it seems to us that where there is
an emergency by reason of which the State Government directs
under sub-s. (4) of s. 17 of the Act that the provisions of
s. 5A need not be complied with, the whole matter, that is,
the actual requirement of the land for a public purpose must
necessarily have been considered at the earliest stage
itself that is when it was decided that compliance with the
provisions of s. 5A be dispensed with. It is, therefore,
difficult to see why the two notifications cannot, in such a
case, be made simultaneously. A notification under sub-
s.(1) one of s. 4 is a condition precedent to the making of
notification under sub-a. (1) of s. 6. If the Government,
therefore, takes a decision to
823
make such a notification and, there after, takes two further
decisions, that is, to dispense with compliance with the
provisions of s. 5A and also to declare that the land
comprised in the notification is in fact needed for a public
purpose, there is no departure from any provision of the law
even though the two notifications are published on the same
day. In the case before us the preliminary declaration
under s. 4(1) was made on August 18, 1961, and a declaration
as to the satisfaction of the Government on August 19,
1961, though both of them were published in the Gazette of
August 25, 1961. The preliminary declaration as well as the
subsequent declaration are both required by law to be
published in the official gazette. But the law does not
make the prior publication of notification under sub-s. (1)
of s. 4 a condition precedent to the publication of a
notification under sub-s. (1) of s. 6. Where acquisition is
being made after following the normal procedure the
notification under the latter section will necessarily have
to be published subsequent to the notification under the
former section because in such a case the observance of
procedure under s. 5A is interposed between the two
notifications. But where s. 5A is not in the way there is
no irregularity in publishing those notifications on the
same day. The serial numbers of the notifications are No.
5809/41 B(1)/61/18755 dated August 18, 1961, and 5809-4 IB
(1)/61/18760 dated August 19, 1961, and it would appear from
them that the preliminary notification did in fact precede
the final declaration.
These were the only objections raised before us and as
everyone of them has failed the petitions must be dismissed.
We accordingly dismiss them with costs. As however, all
petitions were heard together there will be only one hearing
fee.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 29 of 33
824
SUBBA RAo, J.-I have perused the judgment prepared by my
learned brother, Mudholkar, J. With great respect, I cannot
agree.
The fact are fully stated by my learned brother and they
need not be restated except to the extent relevant to the
question I propose to consider.
About six acres of land purchased by the petitioners in Writ
Petition No. 246 of 1961 for a sum of Rs. 4,60,000 in
February, 1961, is situate in village Meola Maharajpur,
Tehail Balabhgarh, District Gargaon. On August 25, 1961,
the Governor of Punjab published a notification dated August
18, 1961, in the Official Gazette under s.4 of the Land
Acquisition Act, 1894, hereinafter called the Act, to the
effect that the said land was likely to be needed by the
Government at public expense for a purpose, namely, for
setting up a factory for manufacturing various ranges of
refrigeration compressors and ancillary equipment. Under
s.17 of the Act the appropriate Government directed that the
provisions of s.5A will not apply to the said acquisition;
On the same day, another notification under s.6 of the Act
dated August 19, 1961, was published to the effect that the
Governor of, Punjab was satisfied that the land specified
therein was required by the Government at public expense for
the said purpose. On Septemher 29, 1961, the Government of
Punjab sanctioned an expense of Rs. 100 for the purpose of
acquisition of the said land. The validity of the said
notification is questioned on various grounds. But as I am
in favour of petitioners on the question of interpretation
of the proviso to s.6 of the Act, I do not propose to
express my opinion on any other question raised in the case.
The material part of s.6(1) of the Act reads:
"Subject to the provisions of Part VII of
this Act, when the appropriate Government is
825
satisfied, after considering the report, if
any, made under section 5A, sub-section (2),
that any particular land is needed for a
public purpose, or for a Company, a
declaration shall be made to that effect under
the signature of Secretary to such Government
or of some officer duly authorized to certify
its order
Provided that no such declaration shall be
made unless the compensation to be awarded for
such property is to be paid by a Company, or
wholly or partly out of public revenues or
some fund controlled or managed by a local
authority."
Under that section, the Government may declare that a
particular land is needed for a public purpose or for a
company; and the proviso imposes a condition on the issuance
of such a declaration. The condition is that no such
declaration shall be made unless the compensation to be
awarded for such property is to be paid by the company or,
wholly, or ’partly out of the public revenues. A reasonable
construction of this provision uninfluenced by decisions
would be that in the case of an acquisition for a company,
the entire compensation will be paid by the company, and in
the case of an acquisition for a public purpose the
Government will pay the whole or a substantial part of the
compensation out of public revenues. The underlying object
of the section is apparent: it is to provide for a safeguard
against abuse of power. A substantial contribution from
public coffers is ordinarily a Guarantee that the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 30 of 33
acquisition is for a public purpose. But it is argued that
the terms of the section are satisfied if the appropriate
Government contributes a nominal sum, say a pie, even though
the total compensation payable may run into lakhs. This
interpretation would lead to extraordinary results. The
Government may acquire the land of A for B for a declared
public purpose, contributing a pie towards the
826
estimated compensation of say, Rs. 1,00,000. If that was
the intention of the Legislature, it would not have imposed
a condition of payment of part of the compensation, for that
provision would not serve the purpose for which it must have
bean intended. Therefore, a reasonable meaning should be
given to the expression "wholly or partly". The proviso
says that the compensation shall be paid by the company or,
wholly or partly, out of public revenues. A contrast
between these two modes of payment suggests the idea that in
one case the compensation must come out of the company’s
coffers and in the other case the whole or some reasonable
part of it should come from public revenues. This idea
excludes the assumption that practically no compensation
need come out of public revenues. The juxtaposition of the
words "wholly or partly" and the disjunctive between them
emphasize the same idea. It will be incongruous to say that
public revenue shall contribute rupees one lakh or one pie.
The payment of a part of a compensation must have some
rational relation to the compensation payable in respect of
the acquisition for a public purpose. So construed "part"
can only mean a substantial part of the estimated
compensation. There cannot be an exhaustive definition of
the words "substantial part of the compensation". What is
substantial part of a compensation depends upon the facts of
each cue, the estimate of the compensation and other
relevant circumstances. While a court will not go
meticulously into the question to strike a balance between a
part and a whole, it will certainly be in a position to
ascertain broadly whether in a particular Case the amount
contributed by the Government towards compensation is so,
illusory that it cannot conceivably be substantial part of
the consideration. There is some conflict of view
827
on this question. The House of Lords in Chatterton v.
Cave (1) defined the word "part" in the context of the
provisions of the Dramatic Copyright Act. The words in the
statute were "Production or any part thereof". The
plaintiffs therein were the proprietors of a drama called,
"The Wandering Jew" and it was alleged that the defendant
produced a drama on the same subject. It was found that
the drama of the defendant was not, except in respect of two
scenes or points, a copy from, or a colourable limitation
of, the drama of the plaintiffs. In that context. the House
of Lords construed the relevant words "production or any
part thereof." Lord O’Hagan observed :
" ’Part’, as was observed, is not necessarily
the same as "particle" and there way be a
taking so minute in its extent and so trifling
in its nature as not to incur the statutable
liability."
This decision may not be directly in point, but the
construction placed upon the expression "Part" is of general
application. In the context of that statute, the court
found that the Legislature clearly intended by the words
"any part’ a real substantial part. A division Bench of the
Madras High Court, consisting of Spencer and Ramesam, JJ.,
directly considered this point in Ponnaia v. Secretary of
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 31 of 33
State (2) . There, a total sum of Rs. 5,985 required for
the acquisition of the property of the appellant therein and
the Government contributed from Provincial revenues an
amount of one anna towards that compensation. The learned
Judges held that it was an indication of the illusory
character of the object for which the provisions of the Act
had been made use of Adverting to the argument that any
small contribution by the Government
(1) (1878)3 App.Cas.483,498. (2) A.I.R. 1426 Mad. 1099.
828
would satisfy the requirement of s.6 of the Act, Ramesam,
J., observed at p. 1100 :
"We think that the Legislature, when they
passed the Land Acquisition Act, did not
intend that owners should be deprived of their
ownership by a mere device of private persons
employing the Act for private ends or for the
gratification of private spite. or malice."
These are weighty observations of a judge of great
experience, who was also the Government Pleader before he
became a judge of the, Madras High Court. The observations
also indicate the statutory object in insisting on a
substantial contribution from public revenues, for a strict
insistence thereon would prevent to a large extent the abuse
of power under the Act. But unfortunately the correctness
of this decision was not accepted by another division Bench
of the same High Court, consisting of Odgers and Madhavan
Nair, JJ., in Senja Naicken v. Secretary State for India
(1). I have carefully gone %rough the judgment in that
case, and, with great respect to the learned Judges, I
cannot see any acceptable reasons for departing from the
earlier view of the same court. Odgers, J., concentrated
his criticism of the earlier judgment more on the reliance
by the earlier Bench on the decision of the House of Lords
than on the intrinsic merits of the decision itself. It is
true that the learned Judges in the earlier decision relied
upon the observations of the House of Lords, but that was
only. in support of their conclusion why the expression
"part" should not be understood as a particle. But the main
reason they gave was that having regard to the object of
that proviso, the Legislature in using the word "part" could
have only meant a substantial part or otherwise the object
would be
(1) (1926) I.L.R. 50 Mad. 308.
829
defeated and the abuse of power which it intended to prevent
could easily be perpetrated under the colour of the Act.
The second reason given by Odgers, J. was stated by the
learned, Judge thus at p.314 :
" I invited the learned Advocate for the
appellant to say where a particle" would end
and "part" begin of this sum of Rs. 600. It
is true an anna is a very small part of Rs.
600. But nevertheless it is a part.
This adherence to the strict letter in complete disregard of
the spirit of the section certainly defeats the purpose of
the legislation. The word "’partly" in the proviso should
be construed in the setting in which it is used and not in
vacuum, as the earned Judge sought to do. The third reason
the learned Judge gives for his conclusion was stated at p.
315 thus
"Suppose on appeal the compensation had been
enhanced. There is no doubt the Government
would have to defray the extra sum out of the
public revenues and having once undertaken the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 32 of 33
acquisition they could not call on the
constituents again."
This comment again I in my view, is beside the point. It is
not the duty of the Government to meticulously fix a figure
; it may agree to bear a definite proportion of the
compensation that may ultimately be awarded to a claimant
and in that even subsequent variations by hierarchy of
tribunals would not cause any difficulty, for the proportion
would attach itself to the varying figures. That apart, it
need not be a particular fraction of the compensation
ultimately awarded. If the Government agrees to contribute
a substantial part of the
830
estimated compensation that would meet the requirements of
the section. The other learned Judge, Madhavan Nair, J., in
substance agreed with the judgment of Odgers, J., and did
not disclose any additional reasons for differing from the
decision of the earlier Bench. In my’ view, the decision in
Senja Naicken v. Secretary of State (1) is not correct.
These two were considered by a Full Bench of the Madras High
Court in Suryanarayana v. Province of Madras(2). There Sir
Lionel Leach, C.J., delivering the judgment of the Full
Bench, noticed the judgment of the division Bench in Ponnaia
v. Secretary of State (3) and the criticism offered on the
judgment by the later division Bench in Senja Naicken v.
Secretary of State (1) and observed :
"We are in entire agreement with this
criticism."
Then the learned Chief Justice proceeded to
observe:
"In interpreting the proviso we can only have
regard to the words used and, in our judgment,
it is sufficient compliance with the proviso
if any part of. compensation is paid out of
public funds. One anna is a part of the
compensation. It is true it is a small part,
but it is nevertheless a part."
This literal interpretation of the word "part" de hors the
setting in which that word appears in the section, in MY
view, makes the condition imposed on the exercise of the
jurisdiction by the Government meaningless and also
attributed to the Legislature an intention to impose a
purposeless and ineffective
(1) (1926) I.L.R. 50 Mad. 308. (2) I.L.R. (1946) Mad.
153,158.
(3) A.I.R. 1926. Mad. 1099.
831
formality. For the reasons already given, I cannot accept
the correctness of this judgment. I, therefore, hold that
unless the Government agrees to contribute a substantial
part of the compensation, depending upon the circumstances
of each case, the condition imposed by the proviso on the
exercise by the appropriate Government of its jurisdiction
is not complied with. In the instant case it is impossible
to say that a sum of Rs. 100 out of an estimated
compensation which may go even beyond Rs. 4,00,000 is in any
sense of the term a substantial part of the said
compensation. The Government has clearly broken the
condition and, therefore, it has no jurisdiction to issue
the declaration under s. 6 of the Act.
In this view it is not necessary to express my opinion on
the other questions raised in this case.
In the result the said notification is quashed and
respondents 1 to 5 are hereby prohibited from giving effect
to the said notification and taking any proceedings
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 33 of 33
thereunder.
It is common case that the order in Writ Petition No. 246 of
1961 would govern Writ’ Petitions Nos. 247 and 248 of 1961
also. A similar order will issue in these two petitions
also. The respondents will pay the costs of the petitioners
in all the petitions.
By COURT : In view of the majority opinion the Court
dismissed the Writ Petitions with costs. There will be one
set of hearing fee.
Petitions dismissed.
832