Full Judgment Text
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 14
PETITIONER:
MUNICIPAL CORPORATION OF GREATERBOMBAY
Vs.
RESPONDENT:
THE INDUSTRIAL DEVELOPMENT &INVESTMENT CO. PVT. LTD. & ORS.
DATE OF JUDGMENT: 06/09/1996
BENCH:
RAMASWAMY, K.
BENCH:
RAMASWAMY, K.
MAJMUDAR S.B. (J)
CITATION:
JT 1996 (8) 16
ACT:
HEADNOTE:
JUDGMENT:
J U D G M E N T
K. Ramaswamy, J.
This appeal by Special leave arises from the judgment
and order dated July 14, 1988 in Appeal No. 120 of 1988 of
the Bombay High Court reversing the judgement and order of
the learned Single Judge and quashing the award passed under
Section 11 of the Land Acquisition Act, 1894 (for short ’the
Act’) and the notification dated 6th September 1972 issued
under Section 6 of the Act read with Section 126(2) of the
Maharashtra Regional and Town Planning Act (for short, the
MRTP Act’) as inoperative. It was held that the land in
question could not be acquired under the Act. It was also
further declared that all steps taken for taking possession
and vesting of plot of land bearing CS No. 503, Dharavi
Division, Bombay, in pursuance of the said award were
illegal.
A few relevant facts leading to these proceedings
deserve to be noted at the outset. On 6th January 1967 a
draft development plan for "G" Ward of the Bombay Municipal
Corporation was sanctioned by the State of Maharashtra in
exercise of its powers under Section 31 sub-section (1) of
the MRTP Act. The said draft development plan was earlier
prepared by the then planning authority, namely, the
Municipal Corporation of Bombay as per the provisions found
in Chapter III of the MRTP Act dealing with the preparation,
submission and sanction to development plan. It is not in
dispute between the parties that necessary gamut enjoined by
Sections 21 to 30 of the MRTP Act was gone through by the
then planning authority functioning under the Act and that
ultimately culminated into the sanctioned draft development
plan by the State Government under Section 31(1) of the MRTP
Act as aforesaid. This sanctioned draft development plan for
"G" Ward of the Municipal Corporation of Bombay came into
force on 7th February, 1967. It is also not in dispute
between the parties that city survey No. 503 Dharvi with
which we are concerned in the present proceedings formed
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 14
part of the said Ward "G" and, therefore, was naturally
covered by the aforesaid sanctioned development plan. The
said city survey plot No. 503 Dharvi is a large piece of
land owned by the 6th respondent, the Provident Investment
Co. Ltd. which belongs to the Government of Madhya Pradesh.
Some portion of the said land, to be precise an area
admeasuring 20,397 sq. yds. was leased out by the 5th
respondent to 1st respondent herein. It was using the same
for the business of manufacture of art silk and rayon
textiles and processing of textiles. The appellant,
Municipal Corporation of Greater Bombay which was original
3rd respondent in the writ petition has a Sewage
Purification Plant at Dharavi. With the increase in the
population and the area under control of the appellant-
Corporation it became necessary to extend the Dharavi Sewage
Purification Works. In the year 1963, it was decided at a
meeting of the Standing Committee of the appellant-
Corporation to acquire City Survey No. 503. The said
requisite proposal was taken note of in the aforesaid
Development Plan prepared under the MRTP Act. In the said
plan, City Survey No. 503 was designated and shown as
reserved for extension of the Dharavi Sewage Purification
Works. As noted above, the said plan came into force w.e.f.
February 7, 1967. On the basis of the aforesaid reservation
of this land in the said plan for the extension of Dharavi
Sewage Purification Works belonging to the appellant-
Corporation, the appellant-Corporation, being the then
planning authority sought to acquire the said land for the
purpose of extension of Dharavi Sewage Purification Plant as
per Section 126(1) of the MRTP Act and the State Government
of Maharashtra being satisfied that the land specified in
the application was needed for the public purpose therein
specified, issued the requisite notification dated July 6,
1972 under Section 126(2) of the MRTP Act read with Section
6 of the Act. The said provisions of Section 126 read as
under :
"126 (1) When after the publication
of a draft Regional Plan, a
Development or any other plan or
town planning scheme, any land is
required or reserved for any of the
public purpose specified in any
plan or scheme under this Act at
any time the Planning Authority,
Development Authority, or as the
case may be, [any Appropriate
Authority may, except as otherwise
provided in Section 113A, acquire
the land] either by agreement or
make an application to the State
Government for acquiring such land
under the Land Acquisition Act,
1894.
(2) On receipt of such application,
if the State Government is
satisfied that the land specified
in the application is needed for
the public purpose therein
specified, or [if the State
Government (except in cases falling
under section 113A itself is of
opinion] that any land included in
any such plan is needed declaration
to that effect in the Official
Gazette, in the manner provided in
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 14
section 6 of the Land Acquisition
Act, 1894, in respect of the said
land. The declaration so published
shall, the said Act, be deemed to
be a declaration duly made under
the said section :
Provided that, no such declaration
shall be made after the expiry of
three years from the date of
publication of the draft Regional
plan, Development plan or any other
plan."
Pursuant to the said notification notices under Section
9 of the Act were issued on March 14, 1973 to the concerned
interested parties inviting claims for compensation. As the
respondents 1 and 2 were in possession of the land as
tenants, they naturally put forward their claims for
compensation. It is in evidence that in 1979, respondents 1
& 2 were also heard in support of their claim petition
seeking appropriate compensation for acquisition of their
rights over the land sought to be acquired.
In the meantime, two important events took place which
have a direct bearing on the result these proceedings. On
January 26, 1975 an Act called the Bombay Metropolitan
Region Development Authority Act, 1974 (hereinafter referred
to as "BMRDA Act") came into force. That was an Act for
forming Greater Bombay and certain areas round about Bombay
Metropolitan Region, to provide for the establishment of an
Authority for the purpose of planning, co-ordinating and
supervising the proper, orderly and rapid development of the
area in that Region and of executing plans, projects and
schemes for such development, and to provide for matters
connected therewith. As per schedule 1 of the said Act, the
Bombay Metropolitan Region consisted of the whole of the
area of the Greater Bombay in the parts of Thane and Colaba
Districts within the specified boundaries. It is not again
in dispute between the parties that the aforesaid City
Survey No. 503. Dharavi got covered by the Bombay
Metropolitan Regions indicated in the said schedule. Under
the BMRDA Act, as per Section 3, the State of Maharashtra
Region as indicated in the said schedule. Under the BMRDA
Act, as per Section 3, the State of Maharashtra constituted
an authority named as Bombay Metropolitan Region Development
Authority (hereinafter referred to as ’BMRDA’). As per
Section 3, sub-section (3) of the said Act, the said
Metropolitan Authority was to be deemed to be a local
authority within the meaning of the term ’local authority’
as defined by Bombay General Clauses Act, 1904. As per
Chapter IV of the BMRDA Act, diverse functions were to be
performed by the said authority. The said BMRDA had, under
Section 12(1)(c), to formulate and sanction scheme for the
development of the Metropolitan Region or any part thereof.
Under MRTP Act, the term ’planning authority’ was defined by
Section 2 sub-section (19) to mean a local authority and it
included a Special Planning Authority constituted or
appointed under Section 40 of that Act. On coming into force
of BMRDA Act, the State Government exercising its power
under Section 40 sub-section (1)(c) of the MRTP Act had
appointed BMRDA as a Special Planning Authority for
development of the notified area, namely, the metropolitan
area notified under BMRDA Act. The said notification was
issued by the State Maharashtra on January 26,
1975.
As per sub-section (3) of Section 40 of the MRTP Act,
on the constitution of the aforesaid planning authority for
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 14
the metropolitan area of Bombay the provisions of Chapter VI
of MRTP Act dealing with ’New Towns’ got attracted for
operation by the said Special Planning Authority, i.e. BMRDA
by a notification dated March 31, 1977 issued by the Urban
Development and Housing Department of the Maharashtra
Government the State Government appointed BMRDA to be the
Special Planning Authority for Kurla Taluq in Bombay sub-
district and Dharavi area of the Bombay city as they were in
a neglected condition and needed to be planned and developed
in a comprehensive manner. In exercise of its powers under
Section 40 sub-section 3(d) read with Section 115 of the
MRTP Act, it submitted to the State Government its proposals
for the development of the area put under its planning
jurisdiction, after following the procedure prescribed
therein on March 7, 1977 for the approval. It is again not
in dispute between the parties that City Survey No. 503
Dharavi was covered by the said notification. Once these
proposals for development of the area known as Bandra Kurla
complex were received by the State Government after the
Special Planning Authority had followed the procedure of
Section 115 sub-section (2) of the MRTP Act read with
Section 40 sub-section 3(d) of the said Act, after the due
consideration given by the State Government, the said
proposals were approved by the State Government as per
Section 115 sub-section 3(d) on April 19, 1979 and they were
published as per Schedule 40 sub-section (5) of the MRTP Act
in Government Gazette on May 3, 1979 and according they
became final.
Section 40 of the MRTP Act with its relevant sub-
clauses reads as
under :
"40 (1) The State Government may,
be notification in the Official
Gazette, for any undeveloped area
specified in the notification (in
this Act referred to as "the
notified area") either -
(a) ... .... .... ....
(aa).... .... .... ....
(b) .... .... .... ....
or
(c) appoint the Bombay Metropolitan
Region Development Authority
established under the Bombay
Metropolitan Region Development
Authority Act, 1974, to be the
Special Planning Act, 1974, to be
the Special Planning Authority for
developing the notified area.
(2) ... ... ... ... ... ...
(3) On the constitution of the
Special Planning Authority, the
provisions of Chapter VI of this
Act shall, subject to the
provisions of this section and
section 41, apply mutatis mutandis
to the Special Planning Authority
as they apply in relation to a
Development Authority, as if the
notified area were a new town,
subject to the following
modification, namely :-
(a) ... ... ... ... ....
(b) ... ... ... ... .....
(c) ... ... ... ... .....
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 14
(d) for section 115 the following
shall be substituted, namely :-
115. (1) A Special Planning
Authority shall, from time to time
submit to the State Government its
proposals for the development of
land (being land either belonging
to, or vesting in, it or acquired
or proposed to be acquired under
section 116), and the State
Government may, after consultation
with the Director of Town Planning,
approve such proposals either with
or without modification.
(2) Before submitting the proposals
to the State Government, the
Special Planning Authority shall
carry out a survey and prepare an
existing land-use map of the area,
and prepare and publish the draft
proposals for the lands within its
jurisdiction together with a notice
in the Official Gazette and local
newspapers in such manner as the
Special Planning Authority may
determine, inviting objections and
suggestions from the public within
a period of not more than 30 days
from the date of notice in the
Official Gazette. The Special
Planning Authority may if it thinks
fit, give individual notices to
persons affected by the draft
proposals.
(3) The Special Planning Authority
may after duly considering the
objections or suggestions, received
by it, if any, and after giving an
opportunity to persons affected by
such draft proposals, if necessary,
and then submit them to the State
Government for its approval. The
orders of the State Government
approving such proposals shall be
published in the Official Gazette.
(e) for section 116, the following
shall be substituted, namely :-
116. Every Special Planning
Authority shall have the powers of
a Planning Authority under this Act
as provided in Chapter VII for the
purposes of acquisition of such
land in the notified area as it
considers to be necessary for the
purpose of development in that area
either by agreement or under the
Land Acquisition Act, 1894, or any
land adjacent to such area which is
required for the development of the
notified area and any land whether
adjacent to that area or not which
is required for provision for
services or amenities for the
purposes of the notified area.
(f) for section 117, the following
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 14
shall be substituted, namely :-
117. Where any land has not been
acquired within a period of ten
years from the date of notification
under sub-section (1) of Section
40, any owner of the land may, be
notice in writing served on the
Special Planning Authority, require
it to acquire his interest therein;
and thereupon, the provisions of
section 127 providing for lapsing
of reservations shall apply in
relation to such land as they apply
in relation to land reserved under
any plan under this Act.
(4) In preparing and submitting its
proposals for developing any land
under section 115 and in approving
them under that section, the
Special Planning Authority and the
State Government shall take
particular care to take into
consideration the provisions of any
draft or final Regional Plan, draft
or final development plan, or any
draft or final town planning
scheme, r any may already be in
force in the notified area or in
any part thereof.
(5) Where any proposals for
development of any land are
approved by the State Government
under section 115, the Provisions
of the proposals approved by the
State Government shall be final,
and shall prevail, and be deemed to
be in force, in such notified area;
and to that extent the provisions
of any such force in the notified
area or any part thereof shall
stand modified by proposals
approved by the State Government."
A conjoint reading of the aforesaid provisions would
show that by May 3, 1979 instead of the original sanctioned
draft development special plan for ’G’ Ward which was
holding the field from February 7, 1967 a new development
general plan for Bandra-Kurla area became operative. As
noted earlier, City Survey No. 503 Dharavi which was earlier
under the ’G’ Ward of Bombay Municipal Corporation and was
covered by Sanctioned Development Plan of January 6, 1966
now got covered by the Bandra-Kurla Complex, plans per the
new Sanctioned Development Plan for Bandra-Kurla complex,
the earlier reservation made in connection with City Survey
No. 503 Dharavi which was earmarked to be utilised for
locating the extended Dharavi Sewage Purification Work got
altered and in its place a new area comprising Block ’A’ was
earmarked for location of a new sewage treatment plant. The
said relevant proposal is found in the booklet captioned
"Bandra Kurla Complex" in Chapter VI thereof containing the
detailed proposals. So far as Block "A" is concerned, in
paragraph 7.1 (v) it has been provided as under :
(v) The Bombay Municipal
Corporation is planning to provide
a sewage treatment plant to be
located near ’A’ Block as
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 14
recommended by their consultants.
Al the sewage from Bandra east and
Kurla etc. will be collected and
pumped to this plant and after
treatment it will be let into the
deep-sea outfall sewer. The present
sewage treatment plant at sion will
be discontinued. The requirement
for an area of 35 acres, including
5 acres to accommodate housing for
essential staff, has been
indicated. The purification plant
proper will be located west of the
’A’ Block by reclaiming at the
southern end of the land strip at
Bandra. But the five acres of land
required for residential purpose
for the essential staff is to be
made available to the Municipal
Corporation from the western
portion of Block ’A’. Further
reclamation on the west for
locating the purification plant
will be done by the Bombay
Municipal Corporation in
consultation with the Central Water
& Power Research Station,
Khadkvasla, as tentatively shown on
the layout plan."
(emphasis supplied)
This clearly shows that May 3, 1979 onwards this sewage
treatment plant was to be located in 35 acres of land
reserved under Block ’A’ of the said planning proposals. It
is, therefore, obvious that Dharavi Sewage Purification plan
had to be dismantled and shifted to Block ’A’ at the place
indicated for it in the approved plan. So far as the City
Survey No. 503, with which we are concerned, went in and was
found located under the new proposals in Block ’H’. The
existing purification plant of the Bombay Municipal
Corporation was found covered by the said block ’H’.
Consequently, the question of its extension no longer
remained feasible or possible for the Municipal Corporation.
On the contrary, the entire land of Block ’H’ over a part of
which the existing sewerage plant was situated was to be
used for the purpose shown in the plan attached to the
proposals. A mere look at the plan attached to the proposals
would show that not only the existing Dharavi Sewage Plant
was to be discontinued and shifted to Block ’A’ but the land
covered by that plan as well as the other lands of Block ’H’
which also naturally covered the disputed City Survey No.
503 were to be utilised for
residential, commercial, para-commercial and social
facilities/purposes. No part of Block ’H’ area was reserved
for any special public purpose, unlike the earlier
reservation of plot No. 503 Dharavi under 1977 Development
Plan.
The result was that after May 3, 1979 City Survey No.
503 got de-reserved from the earlier public purpose of
locating the extension of Dharavi Sewage Purification Plant
and the entire Block ’H’ was to be utilised under the new
plan for residential, commercial, para-commercial and social
facilities by its local residents without any special
reservation for the Municipal Corporation. Normally, on its
so happening, the earlier notification issued under Section
126 sub-section (2) read with Section 6 of the Act lost its
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 14
utility, vitality and necessity. As we have seen earlier,
Section 126(2) read with Section 126(1) requires as a
condition precedent to acquisition of any land which can be
proposed under Section 126(1), that there must exist the
fact situation that such land is earmarked, required or
reserved for any of the public purposes specified in any
plan or scheme under the Act. Section 125 of the MRTP Act
states that any land required, reserved or designated in
Regional plan, Development plan or town planning scheme for
a public purpose or purposes including plans for any area of
comprehensive development or for any new town shall be
deemed to be land needed for a public purpose within the
meaning of the Act, 1894. A conjoint reading of Sections 125
and 126(1), therefore, shows that a planning authority can
propose acquisition of only that land which is required,
reserved or designated in the development plan for any
public purposes and it is such a proposal which can be
accepted by the State Government under sub-section (2) of
Section 126 on being satisfied with the land specified in
the application as needed for public purpose specified
therein. Consequently, any planning authority proposing
action under Section 126(2) by the State Government must
show that the land which it is proposing to acquire is
required, reserved or designated in the concerned
development plan for public purpose and if the land is not
so required, reserved or designated in the plan for a public
purpose it cannot be subjected to proceedings of acquisition
under Section 126(10 read with Section 126(2). Once the
specification of public purpose concerning the given land
ceases to exist because of the de-reservation under the plan
so far as that land is concerned, it cannot be acquired
under Section 126(1) read with Section 126(2) for the
planning authority by the State Government, without being
required reserved or designated for any public purpose in
the revised development plan.
It has to be kept in view that Section 126 sub-section
(1) of the MRTP Act is a substitute for Section 4
notification under the Act. Once a proposal for acquisition
of land earmarked in development plan for a specified public
purpose is moved by the planning authority as per Section
126(1), on acceptance of such proposal by the Stage
Government a notification under Section 126(2) read with
Section 6 of the Act gets issued. It has to be appreciated
that as there is no provision for notification under Section
4 of the Act for such acquisition under the MRTP Act no
Section 5A enquiry under the Land Acquisition Act is
contemplated under the MRTP Act. It is also not necessary to
have such an enquiry made after the proposal for acquisition
is moved under Section 126(1) of the MRTP Act by concerned
planning authority, for the obvious reason that earmarking
of the concerned land for specified public purpose under the
development plan, which is the basis of proceedings under
Section 126 sub-section (1) of the MRTP Act, is for public
purpose and has already been done after hearing objections
of persons concerned at the stage of preparation of the
draft development plan.
If we turn to Chapter III of the MRTP Act, we find the
entire machinery is provided for preparation, submission and
sanction of development plan proceeding from Section 21 and
ending with Section 31. These provisions, in short, provide
for preparation of draft development plan by the planning
authority inviting objections of persons concerned against
such proposals, hearing of objections (3) by the Planning
Committee and then submitting its report to the planning
authority which ultimately gets the proposals approved by
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 14
the State Government under Section 30. All these provisions
do indicate that requirement, designation, reservation or
earmarking of any land for acquisition for any specified
public purpose as indicated in the plan has already
undergone the process of hearing after the objections of the
concerned persons were considered and then such land gets
earmarked for public purpose in the plan. It is after that
stage, therefore, when need to acquire such earmarked,
designated or reserved land for public purpose under the
plan arises, that Section 126(1) proposals gets issued by
the concerned planning authority and which itself becomes a
substitute for Section 4(1) notification under the Act. It
would thus, appear that the scheme of acquisition of
earmarked land under the plan for a specified public
purpose thereunder, is a complete scheme or code under the
MRTP Act. It is distinct and independent scheme as compared
to general scheme of acquisition under the Land Acquisition
Act.
In this connection, Section 128 of the MRTP Act also is
worth noting. The said section provides that if the State
Government wants to acquire lands for any purposes other the
one for which the land is designated in any plan or scheme
then it has to resort to notification under the Act which
would naturally be followed by Section 5A enquiry as per the
said Act subject to Section 17 of that Act, and then only
the State can issue declaration under Section 6 of the said
Act independtly of the provisions of the MRTP Act. In such
cases, as acquisition has no nexus with object to such
acquisition for the public purposes mentioned in the
notification, as Section 5A of the Act would then get
attracted to such objections. Thereafter, if Section 6
declaration is issued by the State Government and if
ultimately the land gets vested in the State Government
under Section 16 and 17 of the Act, then as provided by
Section 128 sub-section (3) of the MRTP Act, the relevant
plan or scheme which includes the land in question shall be
deemed to suitably varied by reason of acquisition of the
said land. This provision also would indicate that
acquisition as per Section 126 stands on an entirely
different footing as compared to acquisition of any land for
any public purpose as per the general law of land
acquisition, namely, the Act, 1894.
It is, therefore, clear that for the purpose of
acquisition of any land under Section 126(2) of the MRTP
Act, the land sought to be acquired must have a direct
connection with its specification, earmarking or reservation
plan itself. Such earmarking etc. is its charter. In other
words, absence of public purpose would be a fetter on
exercise of power of acquisition made under Section 126(2)
of the MRTP Act or a truncated public purpose. An exercise
of eminent domain derives its efficacy from the reservation,
specification or designation for public purpose of the
concerned land as found in the development plan itself. If
this nexus or linkage between the specification etc. of
public purpose in the plan and the concerned land which is
sought to be acquired under the MRTP Act is snapped off,
prior to the completion of acquisition proceedings as per
Section 126(2) of the MRTP Act, the entire edifice of
acquisition proceedings under Section 126 would crumble down
and the acquisition under that section would become
incompetent. Such is not the case of acquisition under the
Act simplicitor, which has to start after the issue of
Section 4 notification. Consequently, by considering the
statutory scheme of acquisition under Section 126 of the
MRTP Act, general principle of acquisition under the Act
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 14
cannot be applied wholesale for deciding the legality of
such statutory acquisition under the special scheme
of MRTP Act.
On the facts of present cases, it is not in dispute
that on July 6, 1972 when the State of Maharashtra issued
requisite notification for acquiring lease-hold land of
respondent No.1, situated in City Survey No. 503 Dharavi,
the said land was duly reserved for a public purpose for
extension of Dharavi Water Sewage Plant of the Municipal
Corporation as ear-marked in the then Operative Sanctioned
Development Plan of February 6, 1967. Therefore, on July 6,
1972 was perfectly valid and operative. However, before
acquisition proceedings qua that land pursuant to the said
notification could culminate into the award, the said land
got de-reserved for that specified public purpose and went
out of earmarked purpose. Thus, May 3, 1979 onwards, City
Survey NO. 503 which was then merged and comprised as Block
’H’ of Bandra-Kurla Complex ceased to be reserved for the
specified public purpose of being utilised for extension of
Sewage Plant of the Bombay Municipal Corporation. Once that
happened and it was marked in the approved plan under BMRDA
Act for residential purposes etc, ordinarily efficacy of the
notification under Section 126(2) qua this land got
extinguished and the specified public purpose resultantly
died down.
It would be necessary to emphasise that to implement
the Scheme framed and approved by the state Government under
the MRTP Act, the land was notified under Section 126 as it
was for a public purpose. If the ear-marked, designated or
reserved land in the subsequent plan prepared and approved
under BMRDA Act, does not subserve any public purpose within
the ear-marked, designated or reserved land in the
subsequent plan prepared and approved under BMRDA Act, does
not subserve any public purpose within the ear-marked,
designated or reserved public purposes, necessarily, the
public purpose envisaged under Section 126 outlives its
purpose and gets eclipsed. Public purpose envisaged in
original approved plan no longer survives and if the land
sought to be acquired is diverted to or earmarked or
designated to a private purpose, necessarily remedy must be
either under Chapter 7 of the Act or any relevant law or
Section 126 as per revised and approved scheme at which
stage the owner gets opportunity to submit his objections
for consideration before submitting the plan for approval by
the State Government. Take, for instance, the self same land
under the approved scheme under MRTP Act which was for
purification of sewerage treatment plant. This was a special
Scheme. In the general scheme, i.e., in Bandra-Kurla
scheme, if the said land was earmarked for private purpose,
necessarily the original public purpose was eclipsed.
Further proceedings for acquisition becomes acquiring the
land, in such circumstance, would not be public purpose but
must be for any private purpose unless saved by the special
law, i.e., MRTP Act, or BMRDA Act, which is not consistent
with the revised plan would become necessary. It would,
therefore, be necessary for the interested person to be
vigilant and watchful to impugn such notification under
Section 126 in the High Court under Article 226 before the
acquisition becomes final and conclusive under Section 12(1)
of the Act between the Collector (Land Acquisition Officer)
and the interested person whether or not he appeared or
represented before him and the lands stand vested in the
State under Section 16 or 17 free from all encumbrances.
After the award under Section 11 of the Act was made by
the Collector he is empowered under Section 16 to take
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 14
possession of the land, if the possession was not already
taken, exercising power under Section 17(4). Thereupon, the
land shall vest absolutely in the Government free from all
encumbrances. It is well settled law that taking possession
of the land is by means of a memorandum (panchnama) prepared
by the Land Acquisition Officer and signed by Panch
witnesses called for the purpose. Subsequently, the
Collector hands over the same to the beneficiary by means of
another memorandum or panchnama, as the case may be. But in
this case Section 91 of the BMC Act statutorily comes into
play which would indicate that the Land Acquisition Officer
while making award should intimate to the Commissioner,
Municipal Corporation of the amount of compensation
determined and all other expenses. The Corporation shall pay
over the same to the Land Acquisition Officer.
By operation of sub-section (2) thereof, the amount of
compensation awarded and all other charges indicated in the
acquisition of the property shall be paid by the
Commissioner; "thereupon the said property shall vest in the
Corporation". In other words, on payment of compensation by
the Corporation to the Land Acquisition Officer, statutorily
the Corporation gets transfer of possession from the State
and the acquired property vests in the Corporation free from
all encumbrances. Thereby the Corporation becomes the
absolute owner of the land free from all encumbrances
including tenancy rights, if any alleged to be held by the
respondents.
From the facts of this case, it is clear that the
owner, a public undertaking of the Madhya Pradesh
Government, had received the compensation and handed over
the possession to the Land Acquisition Officer on March 4,
1983. The Land Acquisition Officer, thereby had taken
symbolic possession of the land of the 5th respondent owner.
The owner and the respondents had reference under Section 18
which was pending.
It would be no function of the Collector (Land
Acquisition Officer) to keep inquiring whether the notified
public purpose remains in existence. His authority is to
pass award under Section 11 after following the procedure
under Sections 9 and 10; file the award in the office of the
Collector under Section 12(1); issue notice to all
interested persons under Section 12(2); pay compensation
under Section 31 or deposit it in the Court and to make
reference, if the application under Section 126 of the MRTP
Act or declaration under Section 6 of the Act needs
necessarily be impugned by interested person and have it
quashed before the award proceedings become final and
conclusive under Section 12(1). If the interested person
allows the grass to grow under his feet by allowing the
acquisition proceedings to go on and reach its terminus in
the award and possession is taken in furtherance thereof and
vested in the State free from all encumbrances, the
slumbering interested person would be told off the gates of
the Court that his grievance should not be entertained. On
the other hand, if he enlists vigil and avails of the remedy
of judicial review before the acquisition proceedings reach
the finality, necessarily the High Court would enquire
whether the public purpose under Section 126 of the MRTP Act
was subsisting so as to enable the Land Acquisition Officer
to take further steps under Sections 9 and 10 and to make
the award under Section 11. This would be so because of the
special scheme and special law. But the situation of the
acquisition pursuant to a notification published under
Section 4(1) of the Act and declaration under Section 6 in
this perspective would be different and always stands on a
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 14
different perspective and is independent of the special
scheme envisaged under MRTP Act or BMRDA Act, as the case
may be of. One cannot be and should be confused with
another. They stand poles apart. What is required is clarity
in thinking process. The confusion would land in miscarriage
of justice and avoidable frustration of public purpose. Only
one exception in this behalf would be kept in mind, i.e.,
whether the public purpose envisaged under both the special
Act and the General Act and the use of the acquired land
always be for a public purpose. In this behalf, it is of
relevance to note the law laid down by this Court on the
diversion of the land acquired for one public purpose and
its use thereof for another.
In Gulam Mustafa & Ors. Vs. The State of Maharashtra &
Ors. [(1976) 1 SCC 800], a Bench of three Judges had held
that "once the original acquisition is valid and title had
vested in the municipality, how it used the excess land was
no concern of the original owner and could not be basis for
invalidating the acquisition. There is no principle of law
by which a valid compulsory acquisition stands voided
because long after the requiring authority diverts it to a
public purpose other than one stated in the Section 6(3)
declaration". The same view was reiterated by another Bench
of three Judges in Mangal Oram & Ors Vs. State of Orissa &
Anr. [(1977) 2 SCC 46] wherein it was held that "[U]se of
land after a valid acquisition for a different public
purpose will not be invalidate the acquisition."
In State of Maharashtra Vs. Mahadeo Deoman Rai & Kalal
& Ors. [(1990) 3 SCC 579] yet another Bench of three Judges
had held that requirement of public purpose may change from
time to time but the change will not vitiate the acquisition
proceeding. Concerned authority should review the
requirement aspect periodically in the prevailing social
context. In Collectors of 24 Paraganas & Ors. Vs. Lalit
Mohan Mullick & Ors. [(1986) 2 SCC 138] a Bench of Judges
had held that, "acquisition of the land for a public
purpose, namely, the use of the land for rehabilitation of
displaced persons, to be altered by subsequent development
for another public purpose, namely, for construction of a
hospital was as per Development & Planning Act" In Ram Lal
Sethi & Anr. Vs. State of Haryana & Ors. [(1990) Supp. SCC
11] the land was acquired for public purpose of construction
of road but exigencies of development necessitated allottee
company was in possession for 17 years and was not made a
party to the litigation; allotment was not shown to be an
act of favoritism. It was held by the two-Judge Bench that
the acquisition was not vitiated on account of change of the
user.
It is thus well settled legal position that the land
acquired for a public purpose may be used for another public
purpose on account of change or surplus thereof. The
acquisition validly made does not become invalid by change
of the user or change of the user in the Scheme as per the
approved plan. It is seen that the land in Block ’H’ which
was intended to be acquired for original public purpose,
namely, the construction of Sewage Purification Plant,
though was shifted to Block "A", the land was earmarked for
residential, commercial-cum-residential purposes or partly
for residential purpose etc. It is the case of appellant
that the Corporation intends to use the land acquired for
construction of the staff quarters for its employees. It is
true that there was no specific plan is used by the
Corporation for any designated public purpose, namely,
residential-cum-commercial purpose for its employees, the
later public purpose remains to be valid public purpose in
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 14
the light of the change of the user of the land as per the
revised approved plan. It is true that in the original
scheme the residential quarters for the staff working in
Sewage Purification Plant were intended to be constructed
and the same purpose is sought to be served by the
acquisition of the land by using the land in Block "A".
Nonetheless the acquired land could be used by the
Corporation for residential-cum-commercial purpose for its
employees other than those working in the Sewage
Purification Plant. It would not, therefore, be necessary
that the original public purpose should continue to exist
till the award was made and possession taken. Nor is it he
duty of the Land Acquisition Officer to see whether the
pubic purpose continues to subsist. The award and possession
taken do not become invalid or ultra vires the power of Land
Acquisition Officer. On taking possession, it became vested
in BMC free from all encumbrances including tenancy rights
alleged to be held by the respondents. Possession and title
validly vesting in the State becomes absolute under Section
10 of the Act and thereafter the proceedings under the Act
do not owner. Only before taking possession, the Government
can withdraw from inquiry under section 45 [1] of the Act or
High Court under Article 226 of the Constitution may quash
on legal and valid grounds. If the award under Section 11A
was not made within two years from the date of the
publication of the declaration under Section 6, as enjoined
under Section 11 A of the Land Acquisition Act, whether the
notification under Section 4(1) would lapse. This Court in
Satendra Prasad Jain & Ors. v. State of U.P. & Ors. [(1993)
4 SCC 369] had held that after the land stood vested in the
State, even if the authorities failed to comply with the
statutory requirements, it does not have the effect on the
vesting of land in the State. Thereby the notification under
Section 4(1) and the declaration under Section 6 do not
stand lapse. The same view was reiterated by another Bench
in, Awadh Bihari Yadav & Ors. [(1995) 6 SCC 31]. The High
Court, therefore, was not right in exercise of power under
Article 226 of the Constitution in granting declarations as
mentioned in the beginning or in making order of injunction
against the appellants pending writ petitions. It is equally
settled law that a tenant cannot challenge the notification
under Section 4 and declaration under Section 6 of the Act
when the landlord himself had accepted the award and
received compensation.
The next question is : whether the High Court was right
in issuing the writ after long lapse of time ? The
respondents, admittedly, approached the High Court after a
delay of 4 years; that too after award was made and
possession was taken from the owner. It is seen that the
declaration was published as long back as on May 3, 1979.
Earlier to that after the draft plan was published, notice
was given to all the parties. The respondents, who claim to
be tenants, had not raised the little finger in making any
objection to the proposed scheme or the revised plan. The
award was made on February 24, 1983; possession was taken on
March 4, 1983, and on the same day it stood transferred to
the BMC. The writ petition came to be filed thereafter on
July 4, 1983. The learned Single Judge dismissed the writ
petition on the ground of laches.
In State of Tamil Nadu v. L. Krishnan [(1996) 1 SCC
250], a Bench of three Judges of this Court had held that
"the delay in challenging notification was fatal and the
writ petitions were liable to be dismissed on the ground of
laches". Exercise of power under Article 226 of the
Constitution, after award was made, was held to have been
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 14 of 14
wrongly made. Delay to make award was not a ground to quash
the acquisition proceedings.
In State of Orissa v. Dhobei Sethi & Another [1995 (5)
SCALE 1881], it was held that on account laches on the part
of the petitioners, the writ petition was liable to be
dismissed. It was also held therein that the subsequent
purchaser cannot raise any objection for the validity of the
acquisition. The High Court was, therefore, held unjustified
in issuing the writ and quashing the notification and
declaration under Sections 4(1) and 6 respectively.
In State of Maharashtra v. Digambar [1995 (4) SCALE
98], another Bench of three Judges directed dismissal of the
writ petition on the ground of laches and held that the High
Court had not judiciously and reasonably exercised its
discretion in passing the notification under Section 4(1) of
the Act.
In The Ramjas Foundation v. Union of India [AIR 1993 SC
852], a Bench of three Judges had held that mere retaining
the possession or delay on the part of the authority to
pass award are not grounds to challenge the notification
under section 4(1) and declaration under Section 6, and the
laches was held to be ground to dismiss the writ petition.
Accordingly this Court allowed the appeal and dismissed the
writ petition.
In Ramchand v. Union of India [(1994) 1 SCC 44],
another Bench of three Judges of this Court had held that
because of inordinate delay in approaching the court after
entire process of acquisition was over pursuant to
notification under Section 4(1) and declaration under
Section 6, the court was not justified in quashing the same.
Same view was reiterated in Bhoop Singh vs. Union of India &
Ors. [AIR 1992 SC 1414], Aflatoon & Ors. v. Lt. Governor of
Delhi & Ors. [AIR 1974 SC 2077], Indrapuri Griha Nirman
Sahakari Samiti Ltd. v. The State of Rajasthan & Ors, [AIR
1974 SC 2085], H.D. Vora v. State of Maharashtra & Ors.
[(1984) 2 SCC 337] and Pt. Girdharan Prasad Missir & Another
v. State of Bihar & Another [(1980) 2 SCC 83]. It is thus
well settled law that when there is inordinate delay in
filing the writ petition and when all steps taken in the
acquisition proceedings have become final, the Court should
be loathe to quash the notifications. The High Court has, no
doubt, discretionary powers under Article 226 of the
Constitution to quash the notification under Section 4(1)
and declaration under Section 6. But it should be exercised
taking all relevant factors into pragmatic consideration.
When the award was passed and possession was taken, the
Court should not have exercised its power to quash the award
which is a material factor to be taken into consideration
before exercising the power under Article 226. The fact that
no third party rights were created in the case, is hardly a
ground for interference. The Division Bench of High Court
was not right in interfering with the discretion exercised
by the learned single Judge dismissing the writ petition on
the ground of laches.
The appeal is allowed with costs quantified at Rs.
10,000/- (Rupees Ten Thousand only)