Narayana Pat, J.
1. This appeal is by the unsuccessful plaintiff in O. S. No. 13 of 1961 on the file of the District Judge, Mercara.
2. The relevant facts may be briefly summarised as follows:-- For the purpose of opening of footpath giving access to a High School and the expansion of the Market place at Chowdalu village within the limits of Somwarpet notified area, a notification dated 3-1-1956 under Section 4(1) of the Land Acquisition Act was published 'proposing to acquire 3 acres 21 cents of land. After necessary statutory investigation, a further notification under Section 6 of the Act dated 17-5-1956 was published declaring that 2 acres and 19 cents of land described therein is required for a public purpose mentioned above. Out of the land so acquired 47 cents out of survey No. 191/1 and 48 cents out of survey No. 193/4 belonged to the appellant Srinivasan. He did not file any objection during the acquisition proceedings,
3. The entire extent of 2 acres 19 cents however, was not actually put to the use for which the land was declared to be necessary to be acquired. 24 cents were utilised for the footpath and 1 acre 30 cents for extending the market. It is in evidence that either due to lack of funds or on account of an injunction or order of stay obtained by another person pending a writ petition presented to this Court questioning the acquisition, no regular buildings to house the market have been put up. But in the area allotted for market or for running a shan dry the vendors and merchants using the market area themselves put up their temporary sheds.
4. Respondent 3 Chinnappa who owned 14 cents of land near the acquired land, obtained from the President of the notified area one Mogappa sanction for putting up a permanent cinema theatre in his said 14 cents of land in August 1957. He later made two applications to the local authority on 13-8-1957 and 13-10-1957 to sell to him 25 cents and 15 cents respectively out of the acquired land remaining unutilised by the local authority. By a resolution dated 7-11-1957 the Committee of the notified area resolved to sell 40 cents of land to respondent 3. Exhibit D-32 is a copy of the relevant proceedings. The proposal of the local authority for the said sale was approved by the State Government and the approval communicated by Exhibit D-16. Exhibit D-35 dated 4-8-1958 is the sale deed executed in favour of Chinnappa in respect of the said 40 cents of land,
5. By a subsequent resolution Exhibit D-18 dated 31-8-1958, further 25 cents of land was resolved to be sold. That proposal was also approved by the Government and the approval communicated by Exhibit D-17 dated 20-10-1958. The sale deed in respect of the said 25 cents is Exhibit D-36 dated 24-6-1959.
6. The appellant-plaintiff states that he came to know of the sales much later when he found respondent 3 (defendant 3) doing preliminary work on the land for putting up some structures on the land. Ho issued a notice dated 6-9-1960 Ex. P. 1 addressed to the State Government, the President of the notified area and defendant 3 Chinnappa, questioning the legality or propriety of the sales to Chinnappa and informing all of them that they should reconvey the lands in his favour. This notice was issued through a lawyer. The suit was filed on 23-3-1961 praying for a decree declaring that the original land acquisition proceedings were null and void that the two sales in favour of defendant 3 were also null and void and did not convey any title, declaring that the plaintiff was entitled to a right of pre-emption and directing the defendants to execute reconveyance of the 65 cents of land coldto Chinnappa for a consideration of Rs. 4,750 or in the alternative, for damages in the sum of Rs. 5,000.
7. The case made out in the plaint was that while the plaintiff had bona fide believed at the time of the original compulsory acquisition that the same was being made for the public purposes expressed in the relevant notifications, ha had since discovered that the said proceedings were a mere cloak for making available to defendant 3 Chinnappa a portion of land belonging to the plaintiff after acquiring the same compulsorily and that the said nefarious purpose was put through by the then President of the notified area one Mogappa. It is also stated that in any event when the land acquired from the plaintiff was not actually used for the purpose for which it had been acquired, the State Government as well as the local authority impleaded as defendants 1 and 2 were bound to give the first option to the plaintiff to repurchase the land. It is on the basis of these allegations that the several prayers mentioned above have been made.
8. The defence put forward by the first two defendants was that apart from the lands of the plaintiff, adjacent lands of two other owners were also acquired under the Land Acquisition Act, that after utilising 1 acre 44 cents of land for the purpose for which the acquisition had been made 65 cents of land which remained as surplus were sold to defendant 3 as the notified area Committee was of the opinion that it was no longer necessary for the purposes mentioned above. The notified area Committee further pleaded that while selling the land it had made certain stipulations in public interest or for benefit of the public such as that the theatre when built should be made available for public functions of the local authority and also pleaded that a theatre properly run will augment the tax resources of the notified area also.
9. Defendant 3 resisted the suit on the ground that the plaintiff who had not originally objected to the compulsory acquisition was not entitled to question the same as illegal, that the legal basis for the plaintiff's claim was not tenable and that the sales in his favour were not liable to be set aside on any of the grounds depended upon by the plaintiff.
10. The District Judge in his judgment has rejected all the contentions of the plaintiff. He held that the plaintiff has failed to prove any fraud or other informative circumstances sufficient to set at naught the legal effect of the compulsory acquisition and has also failed to make out a case of collusion or mala fides on the part of the then President of the notified area, Mogappa anddefendant 3, Ultimately he dismissed the suit.
11. In This appeal, the prayers based on the right of pre-emption for a reconveyance of land to the plaintiff has not been pressed. The arguments have been confined in the last analysis to the validity or propriety of the sales in favour of defendant 3.
12. So far as the compulsory acquisition itself is concerned, we do not think that it is at all possible for the plaintiff-appellant either on facts or upon any legal principle, to impugn its validity. There is no doubt that the purposes stated to be the ones for which the acquisition was being made in the relevant notifications are public purposes which would furnish sufficient constitutional foundation for compulsory acquisition. It is also found frankly admitted by the plaintiff himself in his evidence before the trial Court that at the time of the acquisition he had bona fide believed that such purposes existed and that land was being acquired for the said purposes. Further, once a declaration of the existence of a public purpose is made Under Section 6 of the Land Acquisition Act, the declaration becomes conclusive by force of statute. The only way in which the said finality can be got rid of is by proving what in law is regarded as fraud on power. There is no allegation of any such fraud on the part of the Government or any individual officer of the Government who was concerned with the acquisition, much less, therefore, any evidence on it.
13. We therefore, proceed to discuss the contentions on the footing that the compulsory acquisition originally made was perfectly valid and not open to question.
14. So far as the sales made in favour of defendant 3 Chinnappa are concerned, it will be convenient to discuss the arguments under two different heads:
(i) in relation to powers of the notified area to dispose of the land and the requirements of law governing the same, and (ii) the facts relating to the case of mala fides or improper conduct on the part of Mogappa to benefit Chinnappa defendant 3.
15. Taking up the second part first, the entire case seems to rest upon a collusion between Mogappa and Chinnappa. Admittedly Mogappa was the President of the notified area during the years 1953 to 1957. It is also in evidence that during that period the Committee for the notified area was not functioning and that all the functions and powers of the committee were being discharged and exercised by the said Mogappa as President. We have alsostated earlier that it was this Mogappa who had given sanction to Chinnappa to construct a cinema theatre so early as in August 1957 although the permission was with reference to Chinnappa's own land of 14 cents in extent. Chinnappa has admitted that it was Mogappa who told him that further land adjacent to his land belonging to the local authority was available. Mogappa has admitted in his evidence that he did not publish the proposal to sell the land in the Gazette.
It is also pointed out that there was at least one other application by one Channabasappa, son of Adike Nanjappa, dated 15-2-1957 for purchase of the land but that the same was by-passed for the benefit of defendant 3 by keeping it pending and unattended to. A reference is also made to a letter by two merchants of the locality Exhibit D-19 dated 14-9-1959 complaining that the land had been sold for a low price when they themselves were prepared to pay much higher price for the same.
16. As against the above circumstances and the documents, the respondents have relied upon other indisputable, or what they describe as indisputable facts. Although at the tune applications for sale of the land were made Mogappa was the President of the Local authority, when the decision to sell was taken he had ceased to be the President, and one Chandrashekharaiah was the President, and further there was also the Committee functioning. The two resolutions to which we have already made a reference are resolutions passed by the entire Committee and were unanimously passed. Before the resolutions were given effect to, the permission of the Government was sought. For enabling the Government to decide whether or not to accord an approval, the Deputy Commissioner of Coorg had made a local inspection and submitted a report recommending that approval may be accorded to the resolutions of the local authority.
The respondents contend that there is no evidence, nor even any suggestion that either Chandrashekharaiah or the members of the Committee or any of the Officers of the Government acted in bad faith or that Mogappa and/or Chinnappa had such influence or could exert such influence upon any one of them to act otherwise than in the course of bona fide exercise of power. It is not even the case of the plaintiff either in his plaint or in his evidence that any one of these persons had acted mala fide or in the interest of Chinnappa.
17. It appears to us that the weight of probabilities is entirely against the case of the plaintiff. It is true as indicated by one of the documents that Mogappa was living as a tenant in one of the houses belonging to Chinnappa. It is also pointed out that in the application made by Chinnappa himself, he has stated that besides the 14 cents of land in Chowdalu village and 1 acre of wet land somewhere else, he was not possessed of any other properties. It is on these two circumstances the first suggestion is made that although the purchase is sought to be made in the name of Chinnappa, he being a person of such impecunious circumstances, the real benefit was going to be secured by Mogappa. Apart from the fact that the basis is too slender for this large inference, the argument itself is destructive of the main case that Mogappa was abusing his power or position for the benefit of a private individual like Chinnappa.
The argument that even the Government were, misled by thinking that the land that was sought to be sold had been purchased by the local authority as appears from the report of the Deputy Commissioner, is of no value for two reasons. First, in the file in which this matter was dealt with, there is the report of the Subedar of Somwarpet Taluk giving full particulars to the effect that the land had been compulsorily acquired for the benefit of the local authority and transferred to the local authority who had paid the compensation thereof. Secondly, when the very Deputy Commissioner who had made that report has given evidence and Was available for cross-examination by the plaintiff, not a single suggestion was put to him to the effect that either he was misled or he deliberately misled the Government by describing the land compulsorily acquired as merely land purchased by the local authority.
18. The oral evidence in the case is singularly devoid of any support for the case of mala fides. The plaintiff who has given evidence has not stated any details or any matter relating to his case of mala fides. Mogappa has admitted certain facts to which we have already made a reference, but has rejected the only suggestion put to him in regard to this case of mala fide as follows:--
'It is not true that no possession of the acquired land have been taken by the notified area at the time when defendant 3 offered to purchase the land. It is not correct to state that I took the application from Chinnappa on the first instance and then proceeded to acquire the lands.'
From Chinnappa the admission has been elicited that it was Mogappa who told him that the land was available. Excepting that fact, there is nothing else elicited from him which lends any support to the case of mala fides. In his chief-examination he has deposed thathe has accepted the sale subject to the conditions mentioned in the agreements Exhibits D-1 and D-2, that at the time of his purchase Mogappa had ceased to have any connection with the local authority but that its affairs were being managed by a Committee of 12 persons. The value of these answers has not been taken away or weakened by anything elicited in the course of his cross-examination.
19. We are not satisfied, therefore, that the plaintiff could successfully attack the sales in favour of defendant 3 on the ground of mala fides or abuse of power.
20. The legal argument is to a considerable extent linked with the purposes of the compulsory acquisition and the circumstances attending the same. Indeed it is not possible for the plaintiff to construct his case completely without some reliance being placed upon either the infirmities in the first compulsory acquisition or the circumstances in which the said acquisition had been made.
21. The general background of the argument Ss that compulsory acquisition is a restriction on a fundamental right, that the restriction can be placed beyond reproach only if the acquisition is made for a public purpose. Unless such a public purpose exists and the land compulsorily acquired is used either wholly or to a very substantial extent for the said purpose, there is no constitutionally justifiable basis for depriving a citizen of his land on the principle of subordinating private interest for public purpose.
22. The next step in the argument is that if after acquisition it is found that a portion thereof is not required for the purpose for which it had been acquired, the same cannot be diverted to any other purpose, because to do so would be to lead to a result that the fundamental right of the original owner had been unnecessarily infringed. A modification of this line of argument is that if the land so unutilised is of a substantial extent, irrespective of whatever proportion it may bear to the total acquired, the legal value of the situation should be dealt with as if the said land alone was the subject of acquisition, with the result that the entire acquisition itself may become open to attack on the ground that no public purpose existed for its acquisition.
23. Finally it is stated that if there is such surplus land, the only proper thing to do is to reconvey the land to the person from whom it had been acquired, because in the light of the effect which the acquisition has on the fundamental rights of citizens, that is the only way in which the acquisition may be completely placed beyond reproach.
24. Although the colour given to the argument in the light of fundamental rights makes it prima facie attractive, wefind it difficult to give full effect to it for the reason that it may lead to consequences which are clearly opposed to established principles.
25. The fundamental right consists in this, namely, that a person shall not be deprived of his property except for a public purpose. If, as a matter of fact, a public purpose did exist for making a compulsory acquisition, the acquisition itself will be beyond the reproach that it is in violation of any fundamental right. Once an acquisition is therefore perfectly valid, it will be too wide a proposition to state that the possibility of some land being surplus or unnecessary for the original purpose for which it was acquired, could operate retrospectively to invalidate the acquisition either fully or in part. The position in regard to the utilisation of the surplus land has to be dealt with upon considerations which are quite consistent with the fact that the original acquisition is perfectly valid,
26. Those principles have to be looked for in the ordinary law of property. After all, compulsory acquisition is a mode of acquisition resulting in the transfer of title from an individual to the State or an authority or another person. When land is compulsorily acquired by the Government, it becomes Government land. When land is acquired by the Government for a local authority and the same is transferred to the local authority, the land belongs to or becomes the property of the local authority. In normal circumstances and in the absence of any conditions or stipulations laid down by the law in public interest, the land becomes subject to the normal right of ownership which gives the owner all the rights of holdings, enjoying, managing, controlling or disposing of that property. If the acquirer is not an individual but a statutory body, the ownership or proprietorship of the statutory body is as complete as that of an individual subject only to this that in the matter of utilisation and disposal of that property the statutory body is governed or controlled by the provisions specially made in the statute governing the same.
27. When, therefore, a statutory body like the local authority has become the owner of land, the question that has to be considered is whether it has the power of disposing of the surplus land, and if so, subject to what conditions?
28. Before proceeding to deal with that question, we might dispose of another argument namely, that the sale in this case was an attempt to divert the property to a purpose other than the one for which it has been acquired, and that therefore, the same is invalid or should be set aside. The only basis for this argument is that the land has been soldfor the purpose of putting up a theatre by a private individual, that running a theatre is not one of the purposes within the competence of the local authority, and that permitting the individual to do so is to divert the property to a private purpose. It appears to us that the building of a theatre is an immaterial circumstance. The essence of the matter is, property is being sold by the local authority to an individual. If it can sell the property, then the use to which the purchaser puts the property is of no consequence so far as the power of disposal is concerned.
The fact that in this case the purchaser happened to be one who wanted to put up a cinema theatre and the local authority taking advantage of the situation made certain stipulations in its own interest such as reserving the right to use the theatre for its public functions, should not make any difference to the essence of the matter, namely, the transaction was a simple sale of land by the local authority to defendant 3.
29. So far as the powers of the local authority are concerned, the relevant statute is the Coorg Municipal Regulation, 1907 (Regulation II of 1907). Section 51 deals with the topic of property vested in the committee. Sub-section (1) thereof reads:
'Subject to any special reservation, which may be made by the State Government, all property of the nature hereinafter in this section specified and situated within the limits of the municipality shall be vested in and belong to the committee, and shall, with all other property which may become vested in the committee, be under its direction, management and control, and shall be held and applied by it for the purposes of this Regulation.'
The sub-section thereafter enumerates various types of property, immoveable and moveable including dust, dirt, dung, ashes etc. Sub-section (2) reads;
'The State Government may, by notification in the official gazette, direct that any property which has vested under Sub-section (1) in the committee shall cease to be so vested, and thereupon the property specified in the notification shall cease to be so vested, and the State Government may pass such orders as they think fit regarding the disposal and management of such property.'
30. Reliance is placed on both these sub-sections as affording an inference that the local authority has the power of disposal of surplus property and also for the proposition that the actual disposal in this case may well be related to the power of the State Government under Sub-section (2).
31. There is nowhere in the Regulation any specific prohibition against disposal of land or any other property belonging to the local authority by way of sale or otherwise. Although Sub-section (1) uses the words 'direction, management and control' but not such words as 'sale or disposal', it is argued that the express terms of the first part of Sub-section (1) by which the property is described as being vested in and belonging to the committee taken along with the fact that there is no prohibition against sale, must as regarded as recognising the normal principle that the ownership of property carries with it the normal right of disposal, and that in the case of a local authority governed by this section the same amplitude of power must be conceded to it subject only to special reservations, if any, made by the State Government.
32. It appears to us that the last mentioned proposition is sound and should be accepted. As we have already pointed out, the difference between an individual owner and a statutory body in the matter of an enjoyment of property is that whereas an individual has full liberty to deal with the property in any way he likes without injuring the rights of others, in the case of a statutory body the user or disposal of the property is governed by the nature of the statutory duties imposed upon the statutory body and the restriction, if any, placed by the statute in the matter of its user and disposal. In the case of statutes governing local authorities, the usual way in which control is exercised is providing for previous approval or sanction or control etc., by the State Government or any other named Officer of the Government.
33. In this view, we do not think it necessary to examine the correctness of the alternative argument namely, that the two orders of the Government Exhibits D-16 and D-17 already referred to may be regarded as notified orders under Sub-section (2) divesting the local authority of the property and the Government themselves making a disposal thereof. In this case, the orders are clearly in the nature of approval by the Government of a disposal by the local authority itself and not an order which first divests the property from the local authority and then places it at the disposal of the Government followed by an order of Government directing the manner of disposal.
34. The actual case is one of a simple sale by the local authority of surplus land, the Government having accorded approval thereto.
35. The only remaining portion of the argument bearing on this aspect of the case is that because the land was of an extent of 65 cents which is clearly a substantial area, the acquisition should be viewed as if the said land alone had been subject of acquisition. This argument was put forward in answer to the argument on behalf of the respondent that out of 2 acres and 19 cents acquired for footpath and market a substantial portion thereof having been utilised for the said purpose, no argument of any invalidity can be pressed in respect of the disposal of the balance.
36. It appears to us that the basic assumptions made in both these arguments are insufficient to furnish support for anything like a principle of general application, because the extent of the land acquired, the extent of the land which remains surplus and the proportion which one may bear to the other are not the only circumstances, much less circumstances of decisive value for examining the question of the validity or otherwise of its user or disposal in the light of the purpose stated for original compulsory acquisition. Before one could entertain or express any opinion on the validity of disposal of surplus, further circumstances which have a direct bearing on the original acquisition of the land itself have to be considered. If, as we have already stated, upon facts the original acquisition is not open to the objection of lack of public purpose, then the manner in which the surplus land is dealt with cannot, in my opinion, have any effect on the validity of the acquisition nor can the purpose stated for acquisition have any relevance to the validity of the manner in which the surplus land has been dealt with. If the circumstances are such that the declaration of the public purpose in the notification under Section 6 itself may be looked upon with suspicion, it may be a case for Investigation and decision whether the process of compulsory acquisition was not resorted to as a cloak for an unlawful purpose.
37. The question therefore, has to be dealt with as one of fact in all the circumstances of each case and not one which can be disposed of on a general principle of law. Upon facts in this case, we have found that there was no infirmity attaching to the original compulsory acquisition and no mala fides or abuse of power sufficient to invalidate the sales in favour of defendant 3.
38. This is sufficient to dispose of the argument addressed on behalf of the appellant.
39. We will only notice one further argument addressed on behalf of the respondents though not raised in the trial Court. It is pointed out that under Section 33 of the Coorg Municipal Regulation, no suit can be instituted against a committee or any of its officers etc. In respect of anything done or purporting to have been done under the Regulation, until after the expiry of two monthsnext after the notice in writing stating the cause of action and other particulars mentioned in Sub-section (1) thereof, and that Sub-section (2) expressly states:
'Every such suit shall be dismissed unless it is instituted within six months from the date of the accrual of the alleged cause of action and service of such notice, as aforesaid is admitted or proved.'
40-41. The argument is that because the question is purely one of law and the facts necessary to decide it are admitted or clearly appear on record, the suit must be dismissed even at appellate stage because what is provided in Sub-section (2) is mandatory direction to the Court to dismiss the suit in the circumstances stated therein.
42. As however, this question has not been examined, especially the question whether the present suit is of a nature which can be said to come directly within the scope of Section 33, it is unnecessary to express any opinion thereon.
43. Our findings on the merits of the case are a better reason for confirming the trial Court's decree dismissing the suit.
44. The appeal is dismissed with
45. Appeal dismissed.