Full Judgment Text
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PETITIONER:
BABU BARKYA THAKUR
Vs.
RESPONDENT:
THE STATE OF BOMBAY AND OTHERS.
DATE OF JUDGMENT:
08/08/1960
BENCH:
SINHA, BHUVNESHWAR P.(CJ)
BENCH:
SINHA, BHUVNESHWAR P.(CJ)
IMAM, SYED JAFFER
SARKAR, A.K.
WANCHOO, K.N.
SHAH, J.C.
CITATION:
1960 AIR 1203
CITATOR INFO :
R 1961 SC 343 (5,7)
R 1962 SC 764 (5,21)
R 1963 SC 151 (21,34,53)
RF 1965 SC 646 (9)
RF 1965 SC 995 (6)
RF 1966 SC1593 (15)
R 1966 SC1788 (18,20)
D 1967 SC1074 (8)
O 1970 SC 564 (4)
RF 1971 SC 306 (5,10)
D 1973 SC1150 (9)
RF 1973 SC1461 (1017)
R 1978 SC 597 (128,129)
RF 1980 SC1678 (3)
R 1985 SC 736 (5,14)
D 1985 SC1622 (13,15)
RF 1992 SC1827 (2)
ACT:
Land Acquisition--Preliminary notification--Land needed for
company--Non-mention of public purpose--Legality
Proceedings, if violate fundamental rights--Land Acquisition
Act, 1894 (1 of 1894), ss. 4, 5A, 6, 40--Constitution of
India, Arts. 19(1)(f), 31.
HEADNOTE:
By a notification under s. 4 of the Land Acquisition Act,
1894, the State of Bombay (now Maharashtra) sought to
acquire certain lands, including those of the petitioner,
which were likely to be needed by a company, manufacturing
steel bars and rods, for its factory and buildings and
appointed a Special Land Acquisition Officer to function as
a Collector under s. 5A of the Act. The petitioner by an
objection filed before the said officer denied that the
lands were required for a public purpose and prayed that the
proceedings be quashed. By his petition to this Court under
Art. 32 of the Constitution the petitioner challenged the
legality of the notification under s. 4 of the Act on the
ground that it did not in terms say that the acquisition was
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for a public purpose, and that the acquisition proceedings
infringed Arts. 19 and 31 of the Constitution.
Held, that it is not essential that a notification under S.
4 of the Land Acquisition Act, 1894, should expressly state
that
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the land sought to be acquired is needed for a public
purpose. Where the land is required for a company, the
requirement of the law will be sufficiently met if the
appropriate Government is satisfied on a report under S.
5A(2) or by an enquiry under s. 40 of the Act that the
purpose of the acquisition is the same as contemplated by s.
40 of the Act.
It is apparent from the definitions of the expressions com-
pany ’ and ’public purpose’ contained in s. 3 of the Act
that the former is used in a very comprehensive sense and
the latter is used in its generic sense including any
purpose which may benefit even a fraction of the community
and such purposes as are mentioned in s. 40 of the Act must
fall within its ambit.
State of Bombay v. Bhanji Munji, [1955] 1 S.C.R. 777,
referred to.
A notification under s. 4 of the Act envisages a preliminary
investigation and it is only under s. 6 that the Government
makes a firm declaration. It is not, therefore, correct to
say that a defect in the notification can be fatal to the
acquisition proceedings and particularly where the
acquisition is for a company and investigation has to be
made under s. 5A or s. 40 after the issue of the
notification. In this view of the matter the present
application must be premature.
Clause (6) of the Art. 31 has obviously no application to
the Land Acquisition Act, 1894, and so it is saved by Art.
31(5)(a) of the Constitution even if it contemplates
acquisition for a company which may or may not be for a
public purpose.
Lilavati Bai v. State of Bombay, [1957] S.C.R. 721, referred
to.
The attack under Art. 19(i)(f) of the Constitution must also
fail in view of the decision of this Court in State of
Bombay v. Bhanji Munji, [1955] 1 S.C.R. 777.
JUDGMENT:
ORIGINAL JURISDICTION: Petition No. 134 of 1959.
Petition under Art. 32 of the Constitution of India for
enforcement of fundamental rights.
J. C. Bhatt, R. Ganapathy Iyer and G. Gopalakrishnan, for
the petitioner.
N. S. Bindra, R. H. Dhebar and T. M. Sen, for respondents
Nos. 1 and 2.
S. K. Kapur, P. M. Mukhi and B. P. Maheshwari, for
respondent No. 3.
1960. August 8. The Judgment of the Court was delivered by
17
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SINHA C.J.-This petition under Art. 32 of the Constitution
impugns the constitutionality of the land acquisition
proceedings with particular reference to the notification
under s. 4 of the Land Acquisition Act (hereinafter referred
to as " the Act ") in respect of an area of land within
the district of Thana in the State of Bombay, now known as
the State of Maharashtra.
In order to appreciate the controversy raised in this case,
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it is necessary to state the following facts. By a
notification dated April 3, 1959, the first respondent, the
State of Bombay (now Maharashtra) under s. 4 of the Land
Acquisition Act of 1894, stated that the lands specified in
the schedule attached to the said notification were likely
to be needed for the purposes of the third respondent,
Messrs. Mukund Iron & Steel Works Ltd... a company
registered under the Indian Companies Act, 1913, and having
its registered office at Kurla, Bombay No. 37, in the State
of Maharashtra, for its factory buildings etc. The
notification further stated that under cl. (c) of s. 3 of
the Act, the Government was pleased to appoint the Special
Land Acquisition Officer, the second respondent, to perform
the functions of the Collector under s. 5A of the said Act.
The land in which the petitioner, who is a citizen of India,
claims to be interested as owner is included in the schedule
aforesaid. The petitioner appeared before the second
respondent aforesaid and after several adjournments lodged
objections on June 9, 1959 and also made oral submissions
through his Advocate on that date and the day following, and
requested the second respondent to quash the proceedings on
the ground that the lands contained in the notification were
not required for any public purpose and that the proceedings
were vexatious and malicious. It was further stated before
the second respondent that the third respondent had
negotiated by private treaty for the purchase of the
notified area. The second respondent adjourned further
hearing of the case in order to enable the petitioner and
the third respondent to come to an amicable settlement. A
further hearing took place before the second respondent on
July 15, 1959. On
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that date the petitioner proposed to lead evidence of owners
of several pieces of land included in the area notified for
acquisition to prove that the lands included in the schedule
to the notification were not as a matter of fact required by
the third respondent for any public purpose and that the
third respondent had even negotiated for the purchase of the
said lands by private treaty, but the second respondent
refused permission to lead such evidence on behalf of the
petitioner.
The petitioner raises a number of questions of law attacking
the constitutionality of the land acquisition proceedings
and prays for orders or directions to the State Government
not to give its consent to the aforesaid acquisition under
s. 39 of the Act nor to enter into any agreement with the
third respondent under s. 41 of the Act nor to issue a
notification under s. 6 of the Act declaring that the land
in question is needed for a public purpose, because after
such a declaration the petitioner may be deprived of the
opportunity of contending that the land was not needed for a
public purpose.
The third respondent, through its Business Manager, has put
in an affidavit in answer to the petitioner’s case and has
contended that this writ petition is premature and not
maintainable, that so far, only a notification under s. 4 of
the Act has been issued and objections under s. 5A on behalf
of the petitioner have been heard by the second respondent,
that the State Government has yet to be satisfied as to
whether the acquisition is for purposes specified in s. 40
of the Act and so long as the previous consent of the appro-
priate Government has not been given, the provisions of ss.
6 to 37 of the Act cannot be put into operation. It is
denied that the acquisition is not for a public purpose and
that the proceedings are vexatious or malicious. The third
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respondent does not admit that the second respondent refused
permission to the petitioner to lead any evidence. The
averments in the petition on the merits of the controversy
are denied. It is stated on behalf of the third respondent
that public are vitally interested in the production of this
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Company, the chief products being steel bars and rods which
are in great public demand and are of such vital necessity
to the country that their very production, distribution,
supply and price are controlled by the Government. The
products of the Company are consumed directly in bulk for
public utility projects like dams, hydroelectric projects,
roads, railways, industrial plants and housing projects,
both in the public and private sectors, which constitute the
core of the several five year plans of the Government. It
is further stated that the Company (respondent No. 3) has
included in its proposed industrial expansion projects to be
established on the land sought to be acquired, extensive
provisions for housing for a large number of employees’
families as also for their welfare by providing for parks,
gardens, playgrounds, medical relief centre and similar
other amenities for the welfare of the employees and their
families. All those projects, it is claimed on behalf of
the third respondent, are a " highly commendable public
purpose " which is far more advantageous to the community in
general than to shareholders of the Company. It is further
stated that the first respondent made a detailed
investigation about the usefulness to the public of the
expansion project of the Company including employees’
housing schemes and welfare projects and when it was
satisfied about, the bona fides of the respondent Company
and the genuineness and urgency of their projects and their
utility to the public that the first respondent published
the notification under s. 4 of the Act on April 3, 1959.
The affidavit sworn to by the second respondent, Special
Land Acquisition Officer, Thana, also questions the
maintainability of the writ petition and generally supports
the case sought to be made out by the third respondent. It
is also stated on his behalf that the petitioner or any of
the other persons interested in the land sought to be
acquired did not produce any evidence and that it was
absolutely incorrect to say that he prevented anyone from
leading any evidence as alleged. The Special Land
Acquisition Officer has made the following categorical
statements:-
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"It is denied that the acquisition of the said lands for the
purpose of the third respondent is in no way useful to the
public or that the public are not entitled to the use of any
of the works of the Company as alleged by the petitioner. I
say that the products which are being produced and will be
produced are used and intended to be used inter alia in
public undertakings intended for the general industrial
development of the country. It is denied that the proposed
acquisition is merely for the benefit of few individuals,
namely, the shareholders of the Company as alleged by the
petitioner."
Further on he adds the following:-
" With reference to paragraph 13 of the said petition, it is
denied that I did not permit the petitioner to lead any
evidence before me as alleged by the petitioner. This
allegation, I say, is absolutely dishonest and false. It is
denied that the notification issued by Government under
section 4 of the said Act is not bona fide or is an abuse of
the powers vested in Government. It is denied that the said
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notification is illegal or that, it is not made in good
faith ".
On these allegations and counter allegations the petitioner
has moved this Court to exercise its powers under Art. 32 of
the Constitution on the grounds that the notification under
s. 4 of the Act is illegal, that the land acquisition
proceedings are in violation of Arts. 14, 19 and 31 of the
Constitution and that the acquisition is not for a public
purpose and is mala fide.
In order to determine the present controversy, it will be
convenient, at this stage, to examine the relevant
provisions of the Act. The Act has the following preamble:-
" Whereas it is expedient to amend the law for the
acquisition of land needed for public purposes and for
Companies and for determining the amount of compensation to
be made on account of such acquisition ;.........
In the definition section 3, the definitions of " Company "
and " public purpose " are particularly noteworthy. The
expression " Company " has been used in a very comprehensive
sense of including not only
134
the Companies registered under several statutes, Indian and
English, but also includes a society registered under the
Societies Registration Act of 1860 and a registered society
within the meaning of the Co-operative Societies Act. 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 gazette that it is customary for the Government to
make such provision. 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. The proceedings begin with a Government
notification under s. 4 that land in any locality is needed
or is likely to be needed for any public purpose. On the
issue of such a notification it is permissible for a public
servant and workmen to enter upon the land to do certain
acts specified therein with a view to ascertaining whether
the land is adapted for the purpose for which it was
proposed to be acquired as also to determine the boundaries
of the land proposed to be included in the scheme of
acquisition. It will be noticed that though the preamble
makes reference not only to public purposes, but tlso to
Companies, the preliminary notification under s. 4 has
reference only to public purpose and not to a Company
Section 5A, which was inserted by the amending Act of 1923
and makes provision for hearing of objections by any person
interested in any land notified under s. 4, makes reference
not only to public purpose, but also to a Company. It is
noticeable that s. 5A predicates that the notification under
s. 4(1) may not only refer to land needed for a public
purpose, but also to land needed for a Company and after the
enquiry as contemplated by s. 5A has been made and the
Collector has heard objections, if any, by, interested
parties he has to submit his report to the Government along
with the record of the proceedings held by him and his
recommendations on the objections. Thereupon, the
Government has to make up its mind whether or not
135
the objections were well-founded and the decision of the
appropriate Government of those objections is to be treated
as final. If the Government decides to overrule the
objections and is satisfied that the land, the subject-
matter of the proceedings, was needed for a public purpose
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or for a Company, a declaration has to be made to that
effect. Such a declaration has to be published in the
official gazette and has to contain the particulars of the
land including its approximate area and the purpose for
which it is needed. Once the declaration under s. 6 has
been made, it shall be conclusive evidence that the land is
needed for a public purpose or for a Company. Then follow
the usual Proceedings after notice is given to the parties
concerned to claim compensation in respect of any interest
in the land in question ; and the award after making the
necessary investigation as to claims to conflicting title,
the compensation to be allowed in respect of the land, and,
if necessary, apportionment of the amount of compensation
amongst the persons believed to be interested in the land
under acquisition. We are not concerned here with the
proceedings that follow upon the award of the Collector and
the matters to be agitated therein.
From the preamble as also from the provisions of ss. 5A, 6
and 7, it is obvious that the Act makes a clear distinction
between acquisition of land needed for a public purpose and
that for a Company, as if land needed for a Company is not
also for a public purpose. The Act has gone further and has
devoted Part VII to acquisition of land for Companies and in
sub-s. (2) s. of 38, with which Part VII begins, provides
that in the case of an acquisition for a Company, for the
words " for such purpose " the words " for purposes of the
Company " shall be deemed to have been substituted. It has
been laid down by s. 39 that the machinery of the Land
Acquisition Act, beginning with s. 6 and ending with s. 37,
shall not be put into operation unless two conditions
precedent are fulfilled, namely, (1) the previous consent of
the appropriate Government has been obtained and (2) an
agreement in terms of s. 41 has been executed by the
Company.
136
The condition precedent to the giving of consent aforesaid
by the appropriate Government is that the Government has to
be satisfied on the report of the enquiry envisaged by s.
5A(2) or by enquiry held under s. 40 itself that the purpose
of the acquisition is ;to obtain land for the erection of
dwelling house-, for workmen employed by the Company or for
the provision of amenities directly connected therewith or
that such acquisition is needed for the construction of some
work which is likely to prove useful to the public. When
the Government is satisfied as to the purposes aforesaid of
the acquisition in question, the appropriate Government
shall require the Company to enter into an agreement
providing for the payment to the Government (1) of the cost
of the acquisition, (2) on such payment, the transfer of the
land to the Company and (3) the terms on which the land
shall be held by the Company. The agreement has also to
make provision for the time within which the conditions on
which and the manner in which the dwelling houses or
amenities shall be erected or provided and in the case of a
construction of any other kind of 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.
Such are the relevant provisions of the Act that we have to
consider with reference to the question of the
constitutionality of the land acquisition proceedings now
impugned. The first ground of attack is based on Art. 31(2)
of the Constitution. The provisions of Art. 31(2) make it
clear beyond all controversy that in order that property may
be compulsorily acquired, the acquisition must be for a
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public purpose and by authority of law. But Art. 31(5)(a)
lays down that nothing in cl. (2) shall affect the
provisions of any existing law other than a law to which the
provisions of cl. (6) applies (and the Act is obviously a
law to which the provisions of cl. (6) do not apply).
Therefore even if the Act contemplated acquisition for a
company which may or may not be for a public purpose, it
would be saved by Art. 31(5)(a) as an existing law. (See
Lilavati Bai v. State of Bombay (1)). Further, though it
may
(1) [1957] S.C.R. 721.
137
appear on the words of the Act contained in Part 11, which
contains the operative portions of the proceedings leading
up to acquisition by the Collector that acquisition 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 require-
ments indicate that the acquisition for a Company also is in
substance for a public purpose inasmuch as it cannot be
seriously contended 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. It is not necessary for the
purposes of this case to go into the question whether
acquisition for a Company, even apart from the provisions of
s. 40, will be for a public purpose, or justifiable under
the provisions of the Act, even on the assumption that it
will not serve a public purpose. The facts of the present
case have not been investigated, as this Court was moved
when only a notification under s. 4 of the Act had been
issued; and the purpose of the acquisition in question was
still at the enquiry stage. By s. 38A, which was inserted
by the amending Act of 1933, it has been made clear that an
industrial concern not being a Company, ordinarily employing
not less than 100 workmen, may also take the advantage of
land acquisition proceedings if the purpose of the acquisi-
tion is the same as is contemplated by s. 40 in respect of
Companies. It has been recognised by this Court in the case
of The State of Bombay v Bhanji Munji and Another (1) that
providing housing accommodation to the homeless is a public
purpose. In an industrial concern employing a large number
of workmen away
(1) [1955] 1 S.C.R. 777-
18
138
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.
We are not in possession of all the relevant facts in the
present case as to the exact purpose for which the land is
sought to be acquired. That investigation was in progress
when the petitioner moved this Court. Hence, the contention
raised on behalf of the respondents that the application is
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premature is not wholly devoid of merit.
But the main attack on the constitutionality of the
proceedings in question was based upon the notification
under s. 4, which is in these terms
" Ex. " A ".
NOTIFICATION
REVENUE DEPARTMENT.
Sachivalaya, Bombay, 3rd April, 1959.
LAND ACQUISITION ACT, 1894 (1 of 1894).
District Thana.
No. LTH. 15-59/42051-H-Whereas it appears to the Government
of Bombay that the lands specified in the schedule hereto
are likely to be needed for the purposes of the Company,
viz., for factory buildings, etc., of M/s. Mukund Iron and
Steel Works Limited, Bombay. It is hereby notified under
the provisions of section 4 of the Land Acquisition Act,
1894 (I of 1894), that the said lands are likely to be
needed for the purpose specified above.
All persons interested in the said lands are hereby warned
not to obstructor interfere with any surveyors or other
persons employed upon the said lands for the purpose of the
said acquisition. Any contracts for the disposal of the
said lands by sale, lease, mortgage, assignment, exchange or
otherwise, or any outlay or improvements made therein,
without the sanction of the Collector after the date of this
notification will,
139
under section 24 (seventhly) of the said Act, be disregarded
by the officer assessing compensation for such parts of the
said lands as may be finally acquired.
If the Government of Bombay is satisfied that the said lands
are needed for the aforesaid purpose, a final notification
to that effect under s. 6 of the said Act will be published
in the Bombay Government Gazette in due course. If the
acquisition is abandoned wholly or in part, the fact will be
duly notified in the Bombay Government Gazette.
Under clause (c) of section 3 of the Land Acquisition Act,
1894, the Government of Bombay is pleased to appoint the
Special Land Acquisition Officer, Thana, to perform the
functions of a Collector under section 5-A of the said Act
in respect of the said lands."
It is argued that in terms the notification does not state
that the land sought to be acquired was needed for a public
purpose. In our opinion, it is not absolutely necessary to
the validity of the land acquisition proceedings that that
statement should find a place in the notification actually
issued. The requirements of the law will be satisfied if,
in substance, it is found on investigation, and the
appropriate Government is satisfied as a result of the
investigation that the land was needed for the purposes of
the Company, which would amount to a public purpose under
Part VII, as already indicated. See in this connection The
State of Bombay v. Bhanji Munji and Another (1). In that
case the question was whether the Bombay Land Requisition
Act (Bombay Act XXXIII of 1948) was invalid inasmuch as the
purpose for the requisition was not in express terms stated
to be a public purpose. This Court laid it down that the
statute was not invalid for that reason provided that from
the whole tenor and intendment of the Act it could be
gathered that the property was acquired either for the
purpose of the State or for any public purpose.
It is further argued that s. 4(1) of the Act had deli-
berately omitted the words " for a Company " and insisted
upon a public purpose. The absence from the notification
under s. 4 aforesaid of those words,
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(1) [1955] 1 S.C.R- 777.
140
namely, for a public purpose, are fatal to the proceedings.
The purpose if the notification under s. 4 is to carry on a
preliminary investigation with a view to finding out after
necessary survey and taking of levels, and, if necessary,
digging or boring into the sub-soil whether the land was
adapted for the purpose for which it was sought to be
acquired. It is only under s. 6 that a firm declaration has
to be made by Government that land with proper description
and area so as to be identifiable is needed for a public
purpose or for a Company. What was a mere proposal under s.
4 becomes the subject matter of a definite proceeding for
acquisition under the Act. Hence, it is not correct to say
that any defect in the notification under s. 4 is fatal to
the validity of the proceedings, particularly when the
acquisition is for a Company and the purpose"" has to be
investigated under s. 5A or s. 40 necessarily after the
notification under s. 4 of the Act.
The other attack under Art. 19(1)(f) of the Constitution is
equally futile in view of the decisions of this Court in
State of Bombay v. Bhanji Munji and Another (1) and Lilavati
Bai v. State of Bombay (2). Nothing was said with reference
to the provisions of Art. 14 of the Constitution, though
that Article has been referred to in the grounds in support
of the writ petition.
For the reasons given above, this petition must be dismissed
with costs to the contesting parties.
Petition dismissed.
(1) [1955] 1 S.C.R. 777.
(2) [1957] S.C.R. 721.
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