Full Judgment Text
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PETITIONER:
R. L. ARORA
Vs.
RESPONDENT:
STATE OF U. P.
DATE OF JUDGMENT:
01/12/1961
BENCH:
WANCHOO, K.N.
BENCH:
WANCHOO, K.N.
GAJENDRAGADKAR, P.B.
SARKAR, A.K.
GUPTA, K.C. DAS
AYYANGAR, N. RAJAGOPALA
CITATION:
1962 AIR 764 1962 SCR Supl. (2) 149
CITATOR INFO :
R 1963 SC 151 (25,32)
R 1964 SC1230 (1,2,9,10)
RF 1965 SC 646 (9,10)
F 1965 SC 995 (6,8,10,ETC.,)
RF 1968 SC 432 (2,14)
RF 1975 SC 629 (4,6)
RF 1980 SC1118 (4,14)
R 1980 SC1316 (4,5,9)
ACT:
Land Acquisition-Acquisition for company-
"Work likely to prove useful to the public",
Meaning of-Right of access to persons having
business with company-Product of company being
useful to the public-If satisfy requirement-Land
Acquisition Act, 1894[1 of 1894], ss. 6, 40, 41.
HEADNOTE:
The Government acquired appellant’s land for
a company for setting up a textile machinery parts
factory. The entire compensation for the
acquisition was to be paid by the company. The
Government was satisfied that the product of the
company would be useful to the public and the
agreement between the company and the Government
provided that those who had business with the
company shall have access to the land and works.
The notifications under ss. 4 and 6 of the Land
acquisition Act, 1894, were issued showing that
the land was acquired for the company. The
appellant contended that the notification under s.
6 was invalid as the acquisition was not for the
construction of any work which was likely to prove
useful to the public as contemplated by s. 40
(1)(b) read with cl. (5) of s. 41.
^
Held, (per Gajendragadkar, Wanchoo, Das Gupta
and Ayyangar, JJ., Sarkar, J. contra), that the
notification under s. 6 of the Act was invalid and
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the proceedings should be quashed. Section 40
(1)(b), which alone could apply to the case,
provided that in case of acquisition for a company
the Government could give its consent if the
acquisition was needed for the construction of
some work which was likely to prove useful to the
public. For such cases cl. (5) of s. 41 provided
that the agreement between the company and the
Government shall state the terms on which the
public shall be entitled to use the works. These
provisions had to be read together and required
that the work should be directly useful to the
public and that the agreement should contain a
term as to how the public shall have the right to
use the work directly themselves. The provision of
access to the land or works to those having
business with the company or the fact that the
product of the company would be useful to the
public were not sufficient to bring the
acquisition for a company within the meaning of
the relevant words in ss. 40 and 41. The
satisfaction of the Government that the work was
likely
150
to prove useful to the public upon a wrong
construction of s. 40 and s. 41 was not binding.
The conclusiveness attached by s. 6(3) to the
notification under s. 6(1) was only to this extent
that the land was needed for the purposes of a
company and this was not in dispute.
Babu Barkya Thakur v. The State of Bombay,
[1961] 1 S.C.R. 128 and Pandit Jhandu lal v. State
of Punjab, [1961] 2 S. C. R. 459, referred to.
Per Sarkar, J.-The acquisition for the
company to set up a textile machinery parts
factory was for some work which was likely to
prove useful to the public and was valid. The work
contemplated in s. 40(1)(b) was work from which
the public could in any way derive benefit,
whether by direct use of the work or by enjoyment
of the fruits of the activities carried on there
or otherwise; it could not be confined to a
construction for philanthropic purpose or to such
work as could be itself used by the public. The
meaning could not be restricted by cl. (5) of s.
41 as that would defeat the intention of the
statute. The provisions in the agreement about the
terms on which the public would be entitled to use
the work were inapplicable to cases where the work
was such that the public could not use it.
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal
No. 446 of 1959.
Appeal from the judgment and decree dated
July 30, 1958, of the Allahabad High Court in
Special Appeal No. 202 of 1957.
C. B. Agarwala and Naunit Lal for the
Appellant.
G. S. Pathak, S. T. Desai, and C. P. Lal for
Respondents Nos. 1 to 3.
S. T. Desai, Devendra Swarup and J. P. Goyal
for Respondent No. 4.
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1961. December 15. The Judgment of
Gajendragadkar, Wanchoo, Das Gupta and Ayyangar
JJ., was delivered by Wanchoo, J. Sarkar J.,
delivered a separate Judgment.
WANCHOO, J.-This is an appeal on a
certificate granted by the Allahabad High Court.
The appellant is the owner of certain lands in
village Nauraiya Khera. Out of those lands, 15.5
acres
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were requisitioned by the Defence Department of
the Government of India and are still in their
possession and we are not concerned with that.
Besides that, the appellant has 9 acres of land
which he had purchased many years ago with the
idea of erecting a factory thereon. The appellant
got information in May 1956 that steps were being
taken to acquire his nine acres of land for an
industrialist in Kanpur. He therefore wrote to the
Collector of Kanpur in that connection. On June
25, 1956, however, a notification was issued under
s. 4 of the Land Acquisition Act No. 1 of 1894
(hereinafter called the Act), stating that certain
land which was specified as 11.664 acres in
village Nauraiya Khera was required for a company
for the construction of textile machinery parts
factory by Lakshmi Ratan Engineering Works
Limited, Kanpur (hereinafter called the Works).
This was followed on July 5, 1956 by a
notification under s. 6 of the Act, which was in
terms similar to the notification under s. 4. The
notification also provided for the Collector to
take possession of any waste or arable land
forming part of the land mentioned in the Schedule
to the notification immediately under the powers
conferred by s. 17(1) of the Act. It is not in
dispute that this notification was issued without
taking any action under Part VII of the Act. On
July 31, 1956, the Collector took possession of
the land and handed it over to the Works along
with the buildings standing on it.
In the mean time the appellant had filed a
writ petition in the High Court on July 31, 1956,
praying that the notification of July 5, 1956, be
quashed and had also applied for interim stay As
however possession had already been taken on July
31, 1956, the application for interim stay was
infructuous. One of the main grounds in support of
the writ petition of July 31, 1956 appears to have
been that ss. 38 to 42 of the Act had not been
complied with. It seems that thereafter steps were
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taken by the State Government to comply with the
provisions of ss. 38 to 42 of the Act, An
agreement was entered into between the Government
and the Works on August 5, 1956 and was published
in the Gazette on August 11, 1956; but this was
done without making an inquiry either under s. 5A
or s. 40 of the Act. Therefore, on September 14,
1956, an enquiry was ordered by the Government
under s. 40. The enquiry was accordingly made and
the inquiry submitted his report on October 3,
1956. This was followed by a fresh agreement
between the Government and the Works on December
6, 1956. On December 7, 1956, a fresh notification
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was issued under s. 6 of the Act after the
formalities provided under ss. 38 to 42 had been
completed. Thereupon the appellant filed another
writ petition on January 29, 1957, challenging the
notification of December 7, 1956 on various
grounds.
It is not necessary to give in detail the
grounds on which the notification of December 7,
1956 was attacked. It is enough to say that one of
the grounds was that the notification was invalid
as it was not in compliance with s. 40(1)(b) of
the Act read with the fifth clause of the matter
to be provided in the agreement under s. 41. The
learned Single Judge however held that the
agreement was in accordance with the provisions of
ss. 40 and 41. He also held that there was no
force in the other contentions raised on behalf of
the appellant and dismissed the petition. The
appellant then went in appeal which was dismissed.
He then applied for a certificate to enable him to
appeal to this Court, which was granted; and that
is how the matter has come up before us.
The only question that has been urged on
behalf of the appellant before us is that the
consent of the Government is being sought to be
given to an acquisition for a company which is not
in accordance with s. 4 (1) (b) read with the
fifth clause of the matter to be provided in the
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agreement under s. 41 and therefore the
notification of December 7, 1956 is invalid.
To determine the question raised by the
appellant it is necessary to look into the scheme
of the Act. The preamble to the Act shows that it
is an amending Act enacted for the purpose of
"acquisition of land needed for public purposes
and for Companies and for determining the amount
of compensation to be paid on account of such
acquisition." Section 3(e) defines the expression
"company." The expression "public purpose" is
given an inclusive definition in s. 3(f). Then
comes s. 4 which provides for the issue of a
preliminary notification to the effect that land
in any locality is needed or is likely to be
needed for any public purpose. On the issue of
such notification steps are taken to survey the
land and take all other action necessary to decide
whether the land is fit for the purpose for which
it is needed and in that connection s. 5A provides
for objections by any person interested in the
land, and the Collector hears the objector and
submits his report to Government for appropriate
action. Then comes s. 6 which is in these terms:-
"(1) Subject to the provisions of Part
VII of this Act when the appropriate
Government is satisfied, after considering
the report, if any, made under s. 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 a Secretary to
such Government or of some officer duly
authorised to certify its orders:
Provided that no such declaration shall be
made unless the Compensation to be awarded for
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such property is to be paid by the company, or
154
wholly or partly out of public revenues or some
fund controlled or managed by a local authority.
(2) x x x x x
(3) The said declaration shall be conclusive
evidence that the land is needed for a public
purpose or for a company, as the case may be; and
after making such declaration, the appropriate
Government may acquire the land in manner
hereinafter appearing."
Where however land is to be acquired for a company
no notification under s. 6 can be issued till the
provisions of Part VII of the Act are complied
with, for action under s. 6 for acquiring land for
a company is subject to the provisions of Part
VII. This is made further clear by s. 39 which
lays down that "the provisions of sections 6 to
37(both inclusive) shall not be put in force in
order to acquire land for any Company, unless with
the previous consent of the appropriate
Government. nor unless the Company shall have
executed the agreement hereinafter mentioned."
Before therefore the machinery provided for
acquisition of land under ss. 6 to 37 (both
inclusive) of the Act is put into force for
acquiring land for a company two conditions
precedent must be fulfilled, namely, (i) the
previous consent of the appropriate Government has
been obtained and (ii) an agreement in the terms
of s. 41 has been executed by the company: (see
Baba Barkya Thakur v. The State of Bombay) (1). In
that case the notification under s. 4 of the Act
was challenged as it did not say that the land was
required for a public purpose as provided therein
but only said that the land was required for a
company. This Court however pointed out that-
"though it may appear on the words of
the Act contained in Part II, which contains
the operative portions of the proceedings
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leading up acquisition by the collector for a
Company may or may not be for a public
purpose, the provisions of Part VII make it
clear that the appropriate Government cannot
permit the bringing into operation the
effective machinery of the Act unless it is
satisfied as aforesaid, namely, that the
purpose of acquisition is to enable the
company to erect dwelling houses for workmen
employed by it or for the provision of
amenities directly connected with the company
or that the land is needed for construction
of some work of public utility. These
requirements indicate that the acquisation
for a Company also is in substance for a
public purpose inasmuch as it cannot be
seriously contend that constructing dwelling
houses, and providing amenities for the
benefit of the workmen employed by it and
construction of some work of public utility
do not serve a public purpose."
Therefore, though the words "public purpose" in
ss. 4 and 6 have the same meaning, they have to be
read in the restricted sense in accordance with s.
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40 when the acquisition is for a company under s
6. In one case, the notification under s. 6 will
pay that the acquisition is for a public purpose,
in the other case the notification will say that
it is for a company. The proviso to s. 6(1) shows
that where the acquisition is for a public
purpose, the compensation had to be paid wholly or
partly out of public revenues or some fund
controlled or managed by a local authority. Where
however the acquisition is either for a company,
the compensation would be paid wholly by the
company. Though therefore this distinction is
there where the acquisition is either for a public
purpose or for a company, there is not a complete
dichotomy between acquisitions for the two
purposes and it cannot be maintained that where
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the acquisition is primarily for a company it must
always be preceded by action under Part VII and
compensation must always be paid wholly by the
company. A third class of cases is possible where
the acquisition may be primarily for a company but
it may also be at the same time for a public
purpose and the whole of part of compensation may
be paid out of public revenues or some fund
controlled or managed by a local authority. In
such a case though the acquisition may look as if
it is primarily for a company it will be covered
by that part of s. 6 which lays down that
acquisition may be made for a public purpose if
the whole or part of the compensation is to be
paid out of the public revenues or some fund
controlled or managed by a local authority. Such
was the case in Pandit Jhandu, Lal v. the State of
Punjab (1). In that case the acquisition was for
the construction of a labour colony under the
Government sponsored housing scheme for the
industrial workers of the Thapar Industries Co-
operative Housing Society Limited and part of the
compensation was to be paid out of the public
funds. In such a case this Court held that "an
acquisition for a company may also be made for a
public purpose within the meaning of the Act, if a
part or the whole of the cost of acquisition is
met by public funds" and therefore it was not
necessary to go through the procedure prescribed
by Part VII. It is only where the acquisition is
for a company and its cost is to be met entirely
by the company itself that the provisions of Part
VII apply. In the present case it is not the case
of the respondents that any part of the
compensation is to be paid out of what may be
called public funds. It is not in dispute that the
entire compensation is to be paid by the Works and
therefore the provision of Part VII would apply to
the present case; and it is in this background
that
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we have to consider the contention raised on
behalf of the appellant.
We have already pointed out that s. 39 as
well as the opening words of s. 6 make it clear
that the operative provisions of the Act for the
purpose of acquiring land for a company will only
apply when two conditions precedent have been
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satisfied, namely, (i) the previous consent of the
appropriate government has been given to the
acquisition, and (ii) the company has entered into
an agreement as provided in the Act. This takes us
to s. 40, 41 and 42 of the Act. Section 40 lays
down when the consent of the appropriate
government can be given. Section 41 lays down the
terms which must be incorporated in the agreement.
Section 42 then provides that every such agreement
shall be published in the official gazette and
shall thereupon so far as regards the terms on
which the public shall be entitled to use the work
have the same effect as if it had formed part of
the Act.
Now s. 40(1) lays down that such consent
shall not be given unless the appropriate
government is satisfied either on the report of
the Collector under s. 5A (2) or by an inquiry
held as hereinafter provided (a) that the purpose
of the acquisition is to obtain land for the
erection of dwelling houses for workmen employed
by the company or for the provision of amenities
directly connected therewith, or (b) that such
acquisition is needed for the construction of a
work, and that such work is likely to prove useful
to the public.
The Government therefore cannot give consent
to the acquisition of land for a company unless it
is satisfied about one or other of the two
conditions mentioned in s. 40(1). We are in the
present case not concerned with cl. (a) of s.
40(1) and need not refer to it further. The case
of the respondents is that the Government was
satisfied as to cl. (b) of s. 40(1) and that is
why it gave the
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consent required under s. 39. The main dispute
before us is as to the meaning to be given to cl
(b) of s. 40(1).
We are of opinion that it is not possible to
interpret s. 40(1)(b) in isolation and by itself;
it has to be interpreted in the context of what is
provided in s. 41 about the agreement to be
entered into between the Government and the
company which agreement becomes a part of the Act
under s. 42 so far as regards the terms on which
the public shall be entitled to use the work. Now
s. 41 provides that if the appropriate government
is satisfied that the purpose of the proposed
acquisition is to obtain land for the erection of
dwelling houses for workmen employed by the
company or for the provision of amenities directly
connected therewith or that the proposed
acquisition is needed for the construction of a
work and that such work is likely to prove useful
to the public, it shall require the company to
enter into an agreement with it, providing to the
satisfaction of the appropriate government for the
following matters, namely-
(1) the payment to the appropriate
Government of the cost of the acquisition;
(2) the transfer, on such payment, of
the land to the company;
(3) the terms on which the land shall
be held by the company;
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(4) where the acquisition is for the
purpose of erecting dwelling houses or the
provision of amenities connected therewith,
the time within which, the conditions on
which and the manner in which the dwelling
houses or amenities shall be erected or
provided; and
(5) Where the acquisition is for the
construction of any other work, the time
within which and the conditions on which the
work
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shall be executed and maintained, and the
terms on which the public shall be entitled
to use the work.
It will be clear from the above that the fifth
term is directly related to s. 40(1)(b) and there
can be no doubt that in finding out what is meant
by s. 40 (1)(b) we must take into account the
fifth term in s. 41 and it is only by reading the
two together that it will be possible to find out
the intention of the legislature when it provided
for acquisition of land for a company through the
machinery of the Act.
We may here set out the contentions on either
side as to the interpretation of these provisions.
It is contended for the appellant that though the
words of s. 40 (1)(b) are wide in amplitude and
provide for acquisition of land for construction
of some work which is likely to prove useful to
the public, these words do not carry the meaning
that if the product of the company which
constructs the work is useful to the public, land
can be acquired for it. It is urged that on this
interpretation the Government will be turned into
a sort of agent for acquiring lands for all
companies which produce something which may be
used by the public. It is therefore contended that
when s. 40 (1) (b) says that acquisition may be
made for the construction of some work which is
likely to prove useful to the public, it is not
the product of the work which should be useful to
the public but the work itself should be of direct
use to the public; and it is further urged that
this interpretation of s. 40(1)(b) is confirmed if
one looks at the fifth term to be provided in the
agreement according to s. 41. That requires that
the agreement should provide for the terms on
which the public shall be entitled to use the
work. It is urged that this means that the public
should be entitled to use the work as such and not
merely the product of the work.
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On the other hand it is contended for the
respondents that the words in s. 40(1)(b) are of
wide amplitude and land can be acquired under the
Act for any company when the work set up by the
companies likely to prove useful to the public. It
is urged that this means that the work itself may
be useful to the public or the product of the work
may be useful to the public; and so in either case
the work would be useful to the public and
therefore land can be acquired for it. It is also
urged that the fifth term in s. 41 should not be
held to cut down the wide amplitude of the words
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used in s. 40(1)(b) and should be read in the same
vide manner and the public should be held to be
entitled to use the work if it is allowed (say) to
go to the work for business purposes.
The respondents rely on Ezra v. The Secretary
of State (1) in support of their interpretation of
the relevant words in ss. 40 and 41. In that case
the Bank of Bengal, a Company which was
incorporated under Act XI of 1876, was anxious to
extend its premises for the purpose of providing
accommodation for the Public Debt office. The Bank
was unable to acquire the premises required by it
by private treaty and therefore approached the
Government to acquire the land for it under the
Land Acquisition Act. Action was consequently
taken under Part VII of the Act for acquisition of
the premises for the company and the agreement
provided that the public, subject to the Act
constituting and the bye-laws regulating the Bank,
shall be entitled to use the said building or
buildings in relation to the said Government
business so far as the same might be utilised by
the Bank for the purposes of such business. It was
urged before the High Court that this was not
sufficient compliance with the fifth term of the
agreement provided by s. 41 The High Court
repelled this contention on the ground, firstly
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that the Government was vested with absolute
discretion in this matter and was the sole
custodian of the public interest in this country,
and secondly that the rights of the public
generally were dependant upon the Government
business and the Government had considered the
conditions therein inserted as sufficiently
safeguarding its interests. It was further held
that Court had no power to enter upon a
consideration of the question how far that
provisions sufficiently safeguarded the interests
of the Government or of the public, of which it
was the custodian (see pp. 79-80). The problem
that has been posed before us does not appear to
have been posed before the High Court in that
form. Further the High Court seems to have thought
that as the sections provided for the satisfaction
of the Government there was no power in a court to
enter upon a consideration of the question how far
that provision safeguarded the interests of the
Government or of the public. This decision seems
to suggest that the Government’s decision as to
the terms is completely final and as the
Government was satisfied by the terms it had
imposed in that case the matter was no longer open
before the court. All that we need say about this
case is, as already pointed out, that the question
was not raised before the High Court in the manner
in which it has been raised before us and that may
account for the view taken by the High Court. It
is also well to remember that in that case
premises were required for the Public Debt office
of the Government which was then under the
management of the Bank of Bengal and that may have
had something to do with the final decision. But
in any case, this case does not lay down that it
is for the Government to determine what the
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relevant words in ss. 40 and 41 mean, though the
High Court is right when it says that it is not
for the court to enter upon a consideration of the
question how far the provision made by the
Government in the terms of the agreement
sufficiently
162
safeguards the interests of the public, that being
a matter entirely for the satisfaction of the
Government. But as the matter was not considered
by the High Court from the point of view from
which it has been argued before us, this case
cannot be treated as a decision on the
interpretation of the relevant words in ss. 40 and
41 merely by implication. In any case, if by
implication the said decision supports the
respondents’ contention, it does not correctly
represent the true legal position in that behalf.
In our opinion the interpretation of the material
terms in s. 40(1)(b) and the fifth term of the
agreement provided in s. 41 read together is and
must always be within the jurisdiction of the
court.
Turning now to the opposing contentions as to
the meaning of the relevant words in ss. 40 and
41, we have already said that the two provisions
of ss. 40 and 41 must be read together to find out
the intention of the legislature when it provided
for acquisition of land for a company through the
agency of government. It seems to us that it could
not be the intention of the legislature that the
Government should be made a general agent for
companies to acquire lands for them in order that
the owners of companies may be able to carry on
their activities for private profit. It that was
the intention of the legislature, it was entirely
unnecessary to provide for the restrictions
contained in ss. 40 and 41 on the powers of the
Government to acquire lands for companies. If we
were to give the wide interpretation contended for
on behalf of the respondents on the relevant words
in ss. 40 and 41 it would amount to holding that
the legislature intended the Government to be a
sort of general agent for companies to acquire
lands for them, so that there owners may make
profits. It can hardly be denied that a company
which will satisfy the definition of that word in
s. 3 (e) will be producing something or other
which will be useful to the
163
public and which the public may need to purchase.
So on the wide interpretation contended for on
behalf of the respondents, we must come to the
conclusion that the intention of the legislature
was that the Government should be an agent for
acquiring land for all companies for such purposes
as they might have provided the product intended
to be produced is in a general manner useful to
the public, and if that is so there would be
clearly no point in providing the restrictive
provisions in ss. 40 and 41. The very fact
therefore that the power to use the machinery of
the Act for the acquisition of land for a company
is conditioned by the restrictions in ss. 40 and
41 indicates that the legislature intended that
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land should be acquired through the coercive
machinery of the Act only for the restricted
purpose mentioned in ss 40 and 41, which would
also be a public purpose for the purpose of s. 4.
We find it impossible to accept the argument that
the intention of the legislature could have been
that individuals should be compelled to part with
their lands for private profit of others who might
be owners of companies through the Government,
simply because the company might produce goods
which would be useful to the public. If therefore
the legislature intended by the provisions of s.
40 and 41 that there should be restrictions on the
power to acquire land for companies it can only be
given effect to by putting the narrower meaning on
the words used in ss. 40 and 41, as contended for
by the appellant. Further, reading s. 40 (1) (b)
and the fifth term of the agreement as provided in
s. 41 together (as they must in our opinion be
read together in order to find out the real
intention of the legislature) there can be no
doubt that the only meaning to be given to these
provisions read together is, as contended for on
behalf of the appellant. In this connection we
ought to add that as we shall presently point out
the material words of the fifth term in the
164
agreement provided in s. 41 are reasonably
incapable of the construction suggested by the
respondents.
Let us therefore turn to the words of s. 40
(1)(b), which says that acquisition should be for
some work which is likely to prove useful to the
public. Now if the legislature intended these
words to mean that even where the product of the
work is useful to the public, land can be acquired
for the company for that purpose, the legislature
could have easily used the words "the product of"
before the words "such work". The very fact that
there is no reference to the product of the work
in s. 40(1)(b) shows that when the legislature
said that the work should be likely to prove
useful to the public it meant that the work should
be directly useful to the public through the
public being able to use it instead of being
indirectly useful to the public through the public
being able to use its product. We have no doubt
therefore that when s. 40(1)(b) says that the work
should be useful to the public it means that it
should be directly useful to the public which
should be able to make use of it. This meaning in
our opinion is made perfectly clear by what is
provided in the fifth term in s. 41. Before the
machinery of the Act can be put into operation to
acquire land for a company, the Government has to
take an agreement from the company, and that
agreement must provide, where acquisition is
needed for the construction of some work and that
work is likely to prove useful to the public, the
terms on which the public shall be entitled to use
the work. These works can only mean that the
public should have a right to use the work itself
and not the product of its and it is the duty of
the Government when it takes an agreement under s.
41 to see that the public is so entitled to use
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the work. To say that the public is entitled to
use the work because the public can go to the work
in the way of business is in our opinion not
giving any right to the public to use the work
165
directly as such. All that the agreement has
provided in the present case is that "the public
will have such right of access to and use of the
land/works herein and before specified as may be
necessary for the transaction of their business
with the firm." This in our opinion is not what is
meant by the words "the terms on which the public
shall be entitled to use the work" in the fifth
term of the agreement as provided in s. 41. Such
use for business is implicit in every business,
even if the Government does not acquire land for
it, for no company can carry on for a, moment its
business with any profit if it does not allow
those with whom it has business to come to its
premises. Therefore, when the fifth term provides
for the use of the work by the public as of right
it cannot possibly envisage the use only by those
who have business with a factory (for example) and
their going there to transact business; such use
would in any case have to be permitted by the
owner of the company, as otherwise it will not be
worth his while to run the company at all.
Therefore, when the fifth term provides that "the
public shall be entitled to use the work" it means
that the public shall be entitled to use the work
directly and as of right for its own benefit and
does not mean that those who have business with
the company can go upon the work for that
business. Reading therefore s. 40 (1)(b) and the
fifth term of the agreement provided in s. 41,
there is in our opinion no doubt that the
intention of the legislature was that land should
be acquired only when the work to be constructed
is directly useful to the public and the public
shall be entitled to use the work as such for its
own benefit in accordance with the terms of the
agreement which under s. 42 are made to have the
same effect as if they form part of the Act. We
are of opinion that this is the only
interpretation of the relevant
166
words of ss. 40 and 41, and the legislature could
not have intended otherwise.
Let us now turn to some of the arguments
advanced on behalf of the respondents against the
clear intention of the legislature which is
deducible from the interpretation of the words
used in ss. 40 and 41. It is urged in the first
place that ss. 40 and 41 both provide for the
satisfaction of the Government and it is the
Government which has to be satisfied that the work
is likely to prove useful to the public and
further that it is the Government which has to be
satisfied that the terms contain a provision as to
how the public shall be entitled to use the work.
It is further urged that as the Government in this
case was satisfied that the Works was useful to
the public and was also satisfied as to the terms
in the agreement on which the public shall be
entitled to use the Works, the court has no
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further say in the matter. We are of opinion that
this argument is entirely fallacious. It is true
that it is for the Government to be satisfied that
the work to be constructed will be useful to the
public; it is also true that it is for the
Government to be satisfied that there is a term in
the agreement providing that the public shall be
entitled to use the work; but this does not mean
that it is the Government which has the right to
interpret the words used in s. 40(1)(b) or in the
fifth term of the agreement in s. 41. It is the
court which has to 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. It is for the
court to say what the words in ss. 40 and 41 mean
though it is for the Government
167
to decide whether the work is useful to the public
and whether the terms contain provisions for the
manner in which the public shall be entitled to
use the work. It is only in this latter part that
the Government’s satisfaction comes in and if the
Government is satisfied that satisfaction may not
be open to challenge; but the satisfaction of the
Government must be based on the meaning given to
the relevant words in ss. 40 and 41 by the court.
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 if they have carried out the meaning
given to the relevant words by the court. The
argument therefore that it is the Government’s
satisfaction which is required both by s. 40 and
s. 41 is of no help to the respondents, for it is
for the court to say what these words mean and
then see whether the Government are satisfied
according to the meaning given to these words by
the court. 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 business, that is all that is required by
the relevant words in ss. 40 and 41. We have held
that this is not the meaning of the relevant words
in ss. 40 and 41 and therefore the Government’s
satisfaction on this meaning cannot be binding and
would be worthless.
Learned counsel for the respondents also
relied on certain American decisions and pointed
168
out that the trend in the United States of America
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these days was to give a wide meaning to the power
of eminent domain contained in the fifth amendment
to the Constitution of the United States. The
fifth amendment lays down as follows in this
respect:-
"nor shall private property be taken for
public use, without just compensation."
It seems that there has been controversy in
America as to the meaning of the words "public
use" used in the above amendment and there are two
views prevalent. The older view was, and it is
still held in some States, that "public use" means
"use by the public-that is, public employment-and
consequently that to make a use public, a duty
must devolve on the person or corporation holding
property appropriated by right of eminent domain
to furnish the public with the use intended, and
that there must be a right on the part of the
public, or some portion of it, or some public or
quasi-public agency on behalf of the public, to
use the property after it is condemned". The later
view is that "public use" means "public advantage,
convenience, or benefit, and that anything which
tends to enlarge the resources, increase the
industrial energies, and promote the productive
power of any considerable number of the
inhabitants of a section of the State, or which
leads to the growth of towns and the creation of
new resources for the employment of capital and
labour contributes to the general welfare and the
prosperity of the whole community and giving the
Constitution a broad and comprehensive
interpretation, constitutes a public use" (see
American Jurisprudence. Vol. 18. pp. 661-62). In
one State, where the older view is still held, the
court pointed out that "if public use were
construed to mean that the public would be
benefited in the sense that the enterprise or
improvement for the use of which the property was
taken might contribute to the comfort
169
or convenience of the public, or a portion
thereof, or be esteemed necessary for their
enjoyment, there would be absolutely no limit to
the right to take private property, that it would
not be difficult to show that a factory, hotel,
etc., the erection of which was contemplated,
would result in benefit to the public, and that,
under this power, the property of the citizen
would never be safe from an invasion." (see ibid
p. 664) It is the later view prevalent in some
States in America for which the respondents are
contending, and the result of that would be the
same as pointed out above. But we do not think it
necessary to examine the American cases cited
before us because the words in our statute are not
pari materia with the words used in the fifth
amendment to the American Constitution. The fifth
amendment contemplates that private property shall
not be acquired except for public use. The public
use there is thus connected with the purpose of
acquisition and may perhaps in certain conceivable
circumstances depending upon the conditions in a
particular State, be open to a wider
interpretation. But the two views prevalent about
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it in America itself show that in one view it is
the actual use of the work that is emphasised
while in the other view it is the public benefit
arising from the work that is emphasised. Now so
far as the words in the Act are concerned, it is
to our mind perfectly obvious that it is the
actual use of the work which the Act envisages and
not the public benefit that might directly or
indirectly arise from the use of the land
acquired. This is clear from the words used both
in s. 40(1)(b) and the fifth term of the agreement
provided in s. 41. Section 40(1)(b) requires that
the acquisition is for the construction of some
work, and that work is likely to prove useful to
the public. It does not say that the acquisition
of land would be useful to the public. Further the
fifth term in the agreement provided in s 41 makes
this clear beyond all doubt for it
170
provides that the agreement shall contain the
terms on which the public shall be entitled to use
the work. These words therefore in the Act are
clearly referable to the narrower view prevalent
in America, which emphasises the use by the public
of the actual work constructed. We are therefore
of opinion that the respondents can derive no
advantage from the American cases cited on their
behalf to show the wider interpretation of the
words used in the fifth amendment to the American
Constitution.
Another argument on behalf of the respondents
is based on s. 50 of the Damodar Valley
Corporation Act (No. XIV of 1948) which provides
that "any land required by the Corporation for
carrying out its functions under this Act shall be
deemed to be needed for a public purpose and such
land shall be acquired for the Corporation as if
the provisions of Part VII of the Land Acquisition
Act, 1894 (1 of 1894), were applicable to it and
the Corporation were a company within the meaning
of cl. (e) of s. 3 of the said Act." That section
is not before us for interpretation and it is
therefore not necessary for us to say anything
about the scope and meaning of that section. All
that we need point out is that section was not
enacted to explain what the legislature meant by
the use of the relevant words in ss. 40 and 41.
Whatever therefore may be the interpretation of
that section and whatever may be the reason why
the legislature enacted that section in that Act
that will not control the meaning of the relevant
words in ss. 40 and 41, and it is therefore not
necessary for us to interpret that section in the
present proceedings. As against this, learned
Counsel for the appellant pointed out that there
are many other later Acts creating statutory
corporations like the Damodar Valley Corporation,
in which there is no provision corresponding to s.
50. That again is a matter into which we need not
go, and it is unnecessary to consider why the
legislature provided s. 50 in the Damodar Valley
Corporation
171
Act and did not provide some similar section in
other Acts creating statutory corporations which
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were enacted after the Damodar Valley Corporation
Act was put on the statute book. These
considerations in our opinion have no relevance to
the interpretation of the relevant words of ss. 40
and 41 of the Act and we do not therefore propose
to say anything about s, 50 of the Damodar Valley
Corporation Act. We may add that the works are not
like the Damodar Valley Corporation and what we
say in the present case may not necessarily be
taken to apply to a statutory corporation like the
Damodar Valley Corporation, which is wholly owned
by the State,
Then it was urged on behalf of the
respondents that s. 6(3) makes the purpose noted
in the notification under s. 6(1) not justiciable.
We have not been able to understand how that
provision helps the respondents. All that s. 6(3)
says is that the declaration shall be conclusive
evidence that the land is needed for a public
purpose or for a company. In this case the
declaration was that the land was needed for a
company and that according to s. 6(3) is
conclusive evidence that the land is so needed.
Now it is not the case of the appellant that the
land was not needed for the Works in the present
case, nor does the appellant say that though the
land was needed for some other purpose, the
notification falsely declares that it was needed
for the Works. In the circumstances the
conclusiveness envisaged by s. 6 (3) is of no
assistance to the solving of the problem with
which we are concerned in the present case.
It is then urged for the respondents that
though the appellant had alleged mala fides, that
part of the case was given up by him and therefore
it is not open to him to urge the contentions that
have been urged before us. There is no force in
this argument either, for there is no question of
any mala fides or
172
fraud on the Act in the present case. What the
appellant contends is that the relevant words in
ss. 40 and 41 have a certain meaning and that on
that meaning the action of the State Government in
giving consent for the use of the machinery
provided in the Act for the acquisition of land
for the Works is not within the contemplation of
the Act. This contention has nothing to do with
mala fides or with fraud on the statute. It has
always been the case of the appellant that the
consent given by the Government was not within the
meaning of the relevant words in ss. 40 and 41 and
therefore the entire proceedings for acquisition
of the appellant’s land must be quashed, for the
conditions precedent for the issue of the
notification under s. 6 had not been complied
with. On that case the appellant must succeed, if
we accept the meaning for which he contends, and
that has nothing to do with mala fides or fraud on
the statute on the part of the Government.
Lastly we may notice an argument on behalf of
the appellant that if we look to the history
behind the legislation which culminated into the
Act, we shall find that acquisition for a company
was always for construction of some work which the
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public could use. Reference in this connection was
made to Act XXII of 1863 which provided for
acquisition for private individuals and companies.
That Act applied to works of public utility, which
were defined under s. II to mean any bridge, road,
railroad, tramroad, canal for irrigation or
navigation, work for the improvement of a river or
harbour, dock, quay, jetty, drainage work or
electric telegraph and also all works subsidiary
to any such work. At the same time there was
another Act in force, namely, Act VI of 1857,
which provided for acquisition of land for public
purposes. Then came the Act (X of 1870), which
repealed both Acts No. VI of 1857 and No. XXII of
1863 and made
173
a consolidated provision for acquisition of land
for public purposes and for companies and brought
in Chap. VII for the first time. This Act was
replaced in 1894 by the present Act. However, Act
X of 1870 was a consolidating and amending Act.
The Act of 1894 is also an amending Act.
Therefore, it is not possible to derive much
assistance from the previous law existing before
the Act of 1870 was passed, for it not only
consolidated the previous law but also amended it.
We have therefore to interpret the Act on the
words as they now stand and cannot derive much
assistance from the provisions of Act XXII of
1863. That is why we have interpreted above the
relevant words of ss. 40 and 41 without any
reference to the past history of the law relating
to acquisition of land for public purposes and for
companies.
Coming now to the facts of the present case,
we have to see whether the acquisition is for a
work which is useful to the public under s. 40 (1)
(b) and which the public in entitled to use in
accordance with the fifth term to be entered in
the agreement under s. 41. We have already set out
the term in the agreement which shows that those
who have business with the company shall have such
right of access to and use of the land/works
herein and before specified as may be necessary
for the transaction of their business with the
firm." This in our opinion is not what the
relevant provisions of ss. 40 and 41 require. What
these provisions require is that the work should
be directly useful to public and the agreement
shall contain a term how the public shall have the
right to use the work directly themselves. It
seems to us that under the relevant words in ss.
40(1)(b) and 41 it is works like a hospital, a
public reading room or a library or an educational
institution open to that public or such other work
as the public may directly use that are
contemplated and it is only for such works which
174
are useful to the public in this way and can be
directly used by it that land can be acquired for
a company under the Act. This is also the
implication of the following observations of this
Court in Babu Barkya Thakur’s case (1) at pp. 137-
38 with reference to ss. 40 and 41:
"In an industrial concern employing a
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large number of workmen away from their homes
it is a social necessity that there should be
proper housing accommodation available for
such workmen. Where a large section of the
community is concerned, its welfare is a
matter of public concern. Similarly, if a
Company is generous enough to erect a
hospital or a public reading room and library
or an educational institution open to the
public, it cannot be doubted that the work is
one of public utility and comes within the
provisions of the Act."
The fact that the product of the company would be
useful to the public is not sufficient to bring
the acquisition for a company within the meaning
of the relevant words in ss. 40 and 41. In the
present case all that the Government was satisfied
about appears to be that the product of the
company will be useful to the public and the
provision in the agreement is merely that the
public shall be able to go upon the works for
purpose of business. This in our opinion is not
the meaning of the relevant words under ss. 40 and
41 and therefore the Government’s satisfaction in
that behalf is not enough to entitle it to use the
machinery of the Act for the purpose of
acquisition in this case. We therefore allow the
appeal with costs and setting aside the order of
the High Court quash the notification under s. 6
of the Act and the proceedings resulting
therefrom.
SARKAR, J.-The appellant was the owner of
certain lands. The Government of Uttar Pradesh
acquired the lands under the Land Acquisition
175
Act, 1894. The appellant, thereupon, moved the
High Court at Allahabad under Art. 226 of the
Constitution for an appropriate with to quash the
order of acquisition made by the Government. The
petition was dismissed by the High Court and the
appellant has filed this appeal against the
judgment of the High Court. The land, it may be
stated, was acquired by the Government for a
company called the Lakshmi Ratan Engineering Works
Ltd., which required it for setting up a textile
machinery parts factory.
Sections 6 to 37 of the Act lay down the
procedure for all acquisitions under it. Part VII
of the Act, which consists of ss. 38 to 44
provides for acquisition of lands for companies
for certain specified purposes. It is not in
controversy that the acquisition in the present
case was made under this part. It is necessary to
set out ss. 39, 40 and 41 of Part VII to
appreciate the contention of the appellant:
S. 39. The provisions of sections 6 to
37 (both inclusive) shall not be put in force
in order to acquire land for any Company,
unless with the previous consent of the
appropriate Government, nor unless the
Company shall have executed the agreement
hereinafter mentioned.
S. 40. (1) Such consent shall not be
given unless the appropriate Government be
satisfied, either on the report of the
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Collector under section 5A sub-section (2),
or by an enquiry held as hereinafter provided
,-
(a) that the purpose of the
acquisition is to obtain land for the
erection of dwelling houses for workman
employed by the Company or for the
provision of amenities directly
connected therewith, or
176
(b) that such acquisition is needed
for the construction of some work, and
that such work is likely to prove useful
to the public.
(2) Such enquiry shall be held by such
officer and at such time and place as the
appropriate Government shall appoint.
(3) Such officer may summon and enforce
the attendance of witnesses and compel the
production of documents by the same means and
as far as possible in the same manner as is
provided by the Code of Civil Procedure in
the case of a Civil Court.
S. 41. If the appropriate Government is
satisfied after considering the report, if
any, of the Collector under section 5A, sub-
section (2), or on the report of the officer
making the inquiry under section 40 that the
purpose of the proposed acquisition is to
obtain land for the erection of dwelling
houses for workman employed by the Company or
for the provision of amenities directly
connected therewith, or that the proposed
acquisition is needed for the construction of
a work, and that such work is likely to prove
useful to the public, it shall require the
company to enter into an agreement with the
appropriate Government, providing to the
satisfaction of the appropriate Government
for the following matters, namely:-
(1) the payment to the appropriate
Government of the cost of the
acquisition;
(2) the transfer, on such payment of
the land to the company;
(3) the terms on which the land shall
be held by the Company;
177
(4) where the acquisition is for the
purpose of erecting dwelling houses
or the provision of amenities
connected therewith, the time
within which, the conditions on
which and the manner in which the
dwelling houses or amenities shall
be erected or provided; and
(5) where the acquisition is for the
construction of any other work the
time within which and the
conditions on which the work shall
be executed and maintained, and the
terms on which the public shall be
entitled to use the work.
There is no dispute that the Government
declared that it was satisfied that the
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acquisition needed for the construction of a work,
namely, a textile machinery parts factory and that
this work was likely to prove useful to the public
but the appellant contends that such a factory is
not a work contemplated by s. 40(1)(b) and the
Government had no right, therefore, to give its
consent to the acquisition. The precise
significance of this contention will have to be
stated more fully later.
The first point taken by the respondents
against this contention of the appellant is that
the satisfaction of the Government under s.
40(1)(b) is subjective and that a declaration in
the official gazette that the acquisition is for a
public purpose is under s. 6(3) conclusive and
cannot therefore be questioned in a court. I think
that the appellant is right when he says that this
conclusiveness is of no avail unless the work can
be said to be within s. 40(1)(b). The Government
cannot by simply making a declaration that it is
satisfied that the acquisition is needed for the
construction of some work likely to prove useful
to the public stop further enquiries even
178
though the satisfaction contemplated is the
Government’s subjective satisfaction. If the work
is not within the Act, the Government’s
satisfaction avails nothing. And that is the
contention of the appellant. No doubt if the
Government says it is satisfied, it cannot be
contended that it is not satisfied. But the
Government has to be satisfied about a specified
thing and a question can be raised as to whether
the thing about which the Government is satisfied
is the thing contemplated by the section. I
therefore, proceed to consider whether the work
about which the Government was satisfied in the
present case, is within s. 40(1)(b).
The real question raised by the appellant is
as to the meaning of the words "such work is
likely to prove useful to the public" in cl.(b) of
s. 40(1). What is a work likely to prove useful to
the public ? The appellant says it is a work which
the public can use for the purpose for which it
was constructed. Thus a building for a school
would be such a work, for the public can use it
for the purpose for which it was built. So would a
building for a hospital or a library be. It is
said that this is the natural and ordinary meaning
of the words. Then it is said, even if it were not
so, they have to be so read in view of ss. 39 and
41. The matter is put in this way: In view of s.
39 land cannot be acquired under Part VII unless
two conditions are fulfilled. The first is the
consent of the Government to the acquisition
which, in view of s. 41, cannot be given-leaving
out the cases of acquisition for workmen’s
dwelling houses with which we are not concerned
now-unless the acquisition is needed for the
construction of a work which is likely to prove
useful to the public. The second is the execution
of an agreement by the Company providing for the
matters stated in s. 41, one of which is the terms
on which the public shall be entitled to use the
work to be constructed on the land to be acquired,
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about which work the Government has
179
been satisfied that it is likely to prove useful
to the public. Since both these conditions have to
be fulfilled, the work must be such as the public
can use directly; if it were not such a work then
the condition as to the agreement cannot be
fulfilled. Therefore, the work in s. 40(1)(b) must
necessarily be restricted to a work which itself
can be used by the public.
The appellant contends that the work in the
present case being a factory, it is not one which
the public can use and, therefore, it is not a
work for setting up of which the Government could
under s. 40(1)(b) give its consent to the
acquisition. It appears that in the present case
the Company had executed an agreement purporting
to be in terms of s. 41 and that agreement
provided that the public would have a "right of
access to and use of the land-works......as may be
necessary for the transaction of their business
with the firm", that is, the Company. It is
contended by the appellant that this is not a
compliance with the second condition. It is said
that this is not really providing for the use of
the work for that means use by the public of the
work, for the purpose for which it was built.
Hence, it is argued, that the acquisition is
illegal.
I am unable to accept the appellant’s reading
of s. 40(1)(b) as correct. The words "such work is
likely to prove useful to the public" read by
themselves seem to me plainly to imply a work the
construction which results in some benefit which
the public would enjoy. They do not contemplate
only a work which itself can be put by the public
to its use. For example, a work producing
electricity for supply to the public is a work
which is useful to the public. So also a work
producing any commodity like say, medicines or
cloth would be a work which would be useful to the
public. Again, I feel no doubt that a radio
broadcasting station would be a work which would
be useful to the public. Take another case,
180
namely a post-graduate college turning out a small
number of highly qualified medical doctors. There
can be no doubt that the building for the college
can be said to be a work useful to the public. It
would be so not because the public would have a
chance of getting training there and a small
number of the members of the public would after
the training be able to make a good livelihood,
but because an institution of this kind is useful
to the public as it turns out men who give very
useful service to the public. In all the
illustrations given the works would be useful to
the public though the public might have no access
to the work or any right to use them directly. I
think it would be unduly restricting the meaning
of the word ’useful’ to say that a work is useful
to the public only when it can directly be used by
the public. The words are not work which the
public can use", in which case it might with some
justification have been said that the work must be
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such as the public could use. In the Shorter
Oxford Dictionary, among the meanings of ’useful’
appear, "having the qualities to bring about good
or advantage", "helpful in effecting a purpose". I
find no reason not to apply these meanings to the
word ’useful’ in the section that I am
considering.
If the meaning for which the appellant
contends were to be given to the words, then the
work contemplated can only be a work like a
hospital, school or philanthropic institutions of
similar kind which itself the public can put to
its use. It seems to me that it would be strange
if the section only contemplated that, Part VII
clearly deals with companies as business
institutions. A company in the Act means a company
incorporated under one or other of certain
Companies Acts and includes a society registered
under the Societies Registration Act, 1860 and a
registered society within the meaning of the Co-
operative Societies Act, 1912: see s. 3(e). Now
the first and the last are essentially business
181
institutions. Under s. 38A again, a company for
the purpose of part VII is to include "an
industrial concern, ordinarily employing not less
than one hundred workmen owned by an individual or
by an association of individuals and not being a
Company", This again is essentially a business
organisation. It is true that land cannot be
acquired for this last, mentioned variety of
"Company" under Part VII except for erection of
dwelling houses for its workmen or for amenities
connected therewith. I am however referring to s.
38A to show that Part VII is dealing with
"companies" as business organisations and not as
donors for philanthropic purposes, That being so,
it would be curious if Part VII was intended only
for acquiring lands for these business
organisations so that they might out of charity
set up philanthropic institutions. If
encouragement of philanthrophy was the idea behind
Part VII, why were its provisions not made
available to philanthropic minded private
individuals or associations of individuals ?
Another reason which to my mind indicates
that s. 40(1)(b) is not confined to philanthropic
institutions is that the word ’work’ would hardly
then have been used; it is to my mind a very
inappropriate use of the word ’work’ to describe a
philanthropic institution. ’Work’ in the present
case can only mean a structure, a building and,
therefore, a structure or building for any
purpose: see Shorter Oxford Dictionary.
Section 40, furthermore, contemplates an
enquiry for determining whether the work is likely
to prove useful to the public in course of which
it may even be necessary to compel the attendance
of witnesses and production of documents. This is
not an enquiry to hear the objections of the owner
of the land to be acquired, to the acquisition:
Ezra v. Secretary of State(1) I can hardly imagine
that
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provisions for such elaborate enquiry would have
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been made if all that the Government had to be
satisfied was whether a philanthropic institution
would be useful to the public. It would also
appear inexplicable that Part VII was needed at
all for the purpose of acquisition of land for the
establishment of philanthropic institutions by
companies for that could well have been done under
s. 6 as that would clearly be an acquisition for a
company for a public purpose. I do not suppose
there can be any doubt that the establishment of a
philanthropic institution would be a public
purpose. I am unable to agree with the contention
that land can be acquired for a company only under
Part VII. Section 43 says that this Part would not
apply to acquisition of land for a company for the
purposes of which under an agreement with the
company, the Government is bound to provide land.
Acquisition in such cases for the company has
therefore to be under ss. 6 to 37. It would follow
that under s. 6 land can be acquired for a company
in a case not coming under Part VII. In the view
that land can be acquired for a company under the
Act otherwise than under Part VII, I am supported
by A. Natesa Asari v. The State of Madras (1).
Lastly, I think it right to point out that
though the provisions in Part VII have been on the
statute book since at least 1870, in not a single
case it appears to have been held in all these
years that the work contemplated is work of a
philanthropic nature which the public can put to
its use directly. I am not saying that this is an
argument which is conclusive but it strikes me as
somewhat extraordinary if the meaning was as the
appellant contends, it should not have struck
anyone so long. In Ezra v. Secretary of State (2),
an acquisition of land for the Bank of Bengal
under Part VII for the
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purpose of constructing a building in which the
Public Debt Office of the Government which was in
charge of the Bank, was to be housed, was upheld.
This was not a case of acquisition for a
philanthropic purpose. In Radha Raman v. State of
U. P. (1), an acquisition under Part VII for the
purpose of a co-operative housing society was
upheld. In Ranibala Bhar v. State of West Bengal
(2) an acquisition for extension of the textile
mills of a company was upheld.
Reading s. 40(1)(b) by itself, I am for these
reasons unable to accept the view that the work
there contemplated is only a building or other
construction put up for a philanthropic purpose or
is such as itself can be used by the public. In my
opinion, the work contemplated is a work from the
construction of which the public can in any way
derive benefit, whether by the direct use of the
work or by the enjoyment of the fruits of the
activities carried on there, or, may be,
otherwise.
The question then is, however wide may be the
meaning of the words "work....likely to prove
useful to the public" when read by themselves, has
that meaning to be controlled in view of the fact
that under s. 41 an agreement has to be made with
the company concerning the work providing for the
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terms on which the public can use it ? Is that
meaning to be restricted and the words understood
as contemplating only a work which is capable of
meaning to be restricted and the words public
directly ? I do not think so. That would not be a
reasonable way of interpreting the statute. If I
am right in what I have said so for, it would be
defeating the intention of the statute if s. 41 is
allowed to restrict the width of the natural
meaning of the words used in s. 40(1)(b). In my
view, Part VII was enacted mainly for acquiring
lands for business organisations and therefore for
purposes of their
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business also, provided that business was useful
to the public. Obviously, in a very large majority
of cases of such acquisition it would not be
possible to permit the use by the public of the
works put up on the land. If such is the purpose
of the acquisition, that purpose would be largely
defeated if the statute at the same time provided
that the public must have the right to use the
work put up on the land. A construction leading to
such a result would in my view be wholly
unjustified. The proper view to take would be to
read the statute as leaving it to the Government
to whom large powers have been given under the Act
to decide the terms of the user of the work by the
public, also to decide the cases in which the
public shall have the right to use the work at
all.
I think that the interpretation suggested by
me has the support of authority. It has to be
observed that when it is said that the meaning of
s. 10(1)(b) must be restricted to bring it in
consonance with s. 41, it is conceded that the two
sections cannot stand side by side, each having
its full operation. Now, in such a case, I
conceive it is the duty of the Court to remove the
conflict by such interpretation as would carry out
the intention of the legislature. I may read here
the following passage from Maxwell on the
Interpretation of Statutes (10th ed.) p. 78,
"The beneficial spirit of construction
is also well illustrated by cases where there
is so far a conflict between the general
enactment and some of its subsidiary
provisions that the former would be limited
in the scope of its operation if the latter
were not restricted."
In such a case the rule is to allow scope to the
general enactment. Maxwell cites Cortis v. Kent
Water Works(1) in support of this proposition.
There
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an Act authorised the imposition of a local rate
on all persons occupying land in a parish and gave
a dissatisfied rate-payer an appeal but required
the appellant to enter into a recognisance for
prosecuting the appeal. Under this Act, a
corporation was subjected to a rate and a suit was
brought to recover that rate. It was said on
behalf of the corporation that the Act did not
authorise the imposition of the rate on a
corporation because it contemplated the imposition
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of a rate on a person who could appeal against it
and that a corporation was not such a person
because it could not maintain the appeal provided
in the statute as that appeal was one which a
person who could enter into a recognisance could
prosecute, and a corporation could not enter into
a recognisance. Bayley, J. observed,
"But assuming that they cannot enter
into a recognisance, yet if they are persons
capable of being aggrieved by and appealing
against a rate, I should say that part of the
clause which gives by the appeal applies to
all persons capable of appealing, and that
the other part of the clause which requires a
recognisance to be entered into applies only
to those who are capable of entering into a
recognisance, but is inapplicable to those
who are not."
I think on the same principle I should in the
present case hold that the provisions in the
agreement about the terms on which the public
would be entitled to use the work would be
inapplicable to a case where the work is such that
the public cannot use it. Thus for example, if
land is acquired for setting up a highly
specialised drug factory, it may be a work to
which public admission as of right cannot
conveniently be granted and to such a work the
last part of s. 41(5) would not be applicable.
186
I also find some support for the view that it
is not obligatory that the public shall use the
work from the fact that the user of the work by
the public shall be such as the Government
determines. The Government may be satisfied with
very little user. The Government’s satisfaction as
to the quantum of this user is plainly conclusive.
Therefore, it would seem that the provision as to
the term of the user of the work by the public was
not intended to confer a substantial benefit on
the public a benefit which would warrant an
interpretation defeating which otherwise would
appear to be the main purpose of the statute.
Another reason leading me to the view that it
is not obligatory under the statute that the
public must have a right to use the work is this.
Obviously, the public cannot in any case have the
right to use the whole work. Even if a hospital
was put up, the public cannot insist on using, say
the dispensing room or the place where medicines
are stocked or the residential quarters of the
staff. That being so, it would be for the
Government to decide what user of the work would
be available to the public. If the Government
decides that the public shall have the use of a
very small part of the work, I do not think that
any complaint can be legitimately made. This would
show that the term as to user by the public was in
no case intended to confer a great benefit on the
public. If this is true, there would be less
reason for thinking that was an obligatory term.
If it was not obligatory, it cannot of course
control the meaning of s. 40(1)(b).
What I have said so far does not lead to the
result that Part VII was enacted for the private
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benefit of companies as business organisations.
Nor is its effect to convert the Government into
land agents for them. In order that land may be
acquired under Part VII, the Government must be
satisfied that it is required to put up a work
which
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would be useful to the public. So the controlling
idea is benefit to the public. It is because of
this that the Government acquires the land for the
Company. No doubt the Company would itself derive
some private benefit from the work. But that
cannot justify the view that the acquisition is
for the benefit of the Company only or that the
Act converts the Government into a land agent for
the Company. No one can force the Government to
acquire the land and when the Government does so,
it does for public benefit and not solely for the
Company’s benefit. Take a case where land is
acquired to house the workmen of a company. Here
the public cannot use the land. The acquisition is
no doubt for the benefit of the workmen but at the
same time the financial advantage goes solely to
the Company. Is it to be said that the Act is
converting the Government into land agents for the
Company ? Obviously not. If so, neither can it be
said in the case of acquisition for a company for
putting up a work that the Government would be
acting as a land agent for the company.
It is no argument that the Government might
use its powers under Part VII to advance the
interest of its friends and supporters. Assume the
Government does that. The Government may equally
use all other powers given to it by various
statutes for a similar purpose. But that would not
justify interpreting a statute plainly giving the
Government a power, as not doing so. A country
cannot go on unless power can be entrusted to its
Government. The remedy against the misuse of such
power is not always to the Court but to those who
put the Government where it is,
In the present case, it will be remembered,
the land was acquired for the setting up of a
textile machinery parts factory. The Government
was satisfied that it was a work which would prove
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useful to the public. It seems to me that
Government were entitled so to be satisfied within
the meaning of s. 40(1)(b). It is no part of the
duty of this Court to sit in judgment over the
merits of Government’s satisfaction. I think it
right however to point out that I find no fault
with the Government for having been satisfied that
the work would be useful to the public. Textiles
are an essential commodity for our daily life.
Their manufacture therefore is useful to the
public. Textile manufacture requires textile mills
and the mills no doubt require parts. Therefore a
factory for the purpose of manufacturing these
parts can, in my view, be said to serve a public
purpose. I find it impossible to take any
objection to the present acquisition on the ground
that the work proposed to be set up is not likely
to prove useful to the public. Nor is it a
legitimate objection to the acquisition that the
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public cannot directly use the work and the
reasons for this view have been earlier stated.
I would therefore dismiss this appeal with
costs.
By COURT: In accordance with the opinion of
the majority, the appeal is allowed with costs.
Appeal allowed.
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