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Jhandu Lal Budh Ram and ors. Vs. the State of Punjab and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtPunjab and Haryana High Court
Decided On
Case NumberLetters Patent Appeal No. 52 of 1958
Judge
Reported inAIR1959P& H535
ActsLand Acquisition Act, 1894 - Sections 6, 9(1), 38, 39, 40 and 41; Constitution of India - Article 31
AppellantJhandu Lal Budh Ram and ors.
RespondentThe State of Punjab and anr.
Appellant Advocate D.S. Nehra, Adv.
Respondent Advocate L.D. Kaushal, Deputy Adv. General,; P.C. Pandit and; N.N
DispositionAppeal dismissed
Cases ReferredGurudas Saha v. First Land Acquisition Collector of Calcutta and
Excerpt:
.....purposes which would warrantcompulsory acquisition for a company. 8. thus it seems to me that the land acquisition act deals distinctly with two categories of acquisition, namely, acquisition for a public purpose and acquisition for a private purpose of a restricted type, viz. the declaration under section 6 would be made only after the government is satisfied that the compensation is to be paid by the company where land is required for the benefit of the company. 10. another argument raised before us was that because no notice under section 9(1) was issued, the proceedings were bad. 11. for these reasons i would hold that the purpose for which land was acquired in this case was a public purpose and even though the compensation was paid in its entirety by the company, the proceedings..........in favour of the owners of the land. on 27-5-1955 notifications under sections 4 and 6 of the land acquisition act were issued in respect of 86 bighas and 8 biswas of land near jagadhri. the land acquisition proceedings followed and the patwari delivered possession to the respondent-society on 21-8-1955.the matter was then brought to this court under article 226 of the constitution and it was alleged in the petition that the purpose for which the land had been acquired was not a public purpose and that the notification under section 6 was invalid because the provisions of part vii of the land acquisition act had not been complied with and it was necessary to comply with these provisions in all cases where land is required for a company.3. these contentions were repelled by the.....
Judgment:

Khosla, Ag. C.J.

1. This is an appeal under Clause 10 of the Letters Patent against a decision of Bishan Narain J. in Civil Writ No. 124 of 1957 whereby he dismissed the petition under Article 226 of the Constitution calling in question proceedings under the Land Acquisition Act.

2. The facts briefly are that the Thapar Industrial Workers Co-operative Housing Society, Limited, Jamna Nagar, required land for building houses for its industrial workers. An attempt was made at first to requisition the land but this was abandonedafter the matter was taken to Court and a decree for injunction was passed in favour of the owners of the land. On 27-5-1955 notifications under Sections 4 and 6 of the Land Acquisition Act were issued in respect of 86 bighas and 8 biswas of land near Jagadhri. The land acquisition proceedings followed and the Patwari delivered possession to the respondent-Society on 21-8-1955.

The matter was then brought to this Court under Article 226 of the Constitution and it was alleged in the petition that the purpose for which the land had been acquired was not a public purpose and that the notification under Section 6 was invalid because the provisions of Part VII of the Land Acquisition Act had not been complied with and it was necessary to comply with these provisions in all cases where land is required for a company.

3. These contentions were repelled by the learned Single Judge who found that the purpose for which the land was acquired was a public purpose and that it was not necessary to comply with the provisions of Part VII when land was required for a public purpose. The same points have been agitated before us in appeal. The first point, therefore, to consider is whether in this case land was acquired for a public purpose. The purpose is to build houses for the industrial workers of a co-operative society. The question of what is 'public purpose' has been considered by the Supreme Court in a number of cases and also by the various High Courts. In Tham-biran Padayachi v. State of Madras, AIR 1952 Mad 756, the Madras High Court considered the case of a co-operative house construction society for which land was acquired. Judgment was pronounced by the learned Judges of the Madras High Court upon aconsideration of a large number of cases dealing with the acquisition of land for public purposes. The position was summed up as follows :

'The result of the authorities may be thus summed up: Acquisition of property for public purpose under Article 31(2) includes whatever results in advantage to the public. It is not necessary that it should be available to the public as such. It might be in favour of individuals provided they are benefited not as individuals but in furtherance of a scheme of public utility. Schemes for construction of houses for clearing slum areas, relieving congestion and housing poor people are for a public purpose as they tend to promote social welfare and prosperity.'

4. In the case, The State of Bihar v. Maharajadhjraja Sir Kameshwar Singh of Darbhanga, 1952 S C R 889: (AIR 1952 SC 252), Mahajan J. made the following observation while explaining what is a 'public purpose'.

'The phrase 'public purpose' has to be construed according to the spirit of the times in which particular legislation is enacted and so construed, the acquisition of the estates has to be held to have been made for a public purpose.'

In the same case Das J, made the following observation :

'From what I have stated so far it follows that whatever furthers the general interests of the community as opposed to the particular interest of the individual must be regarded as a public purpose. With the onward march of civilization our notions as to the scope of the general interest of the community are fast changing and widening with the result that our old and narrower notions as to the sanctity of the private interest of the individual can no longer stem tie forward flowing tide of time and must necessarily give way to the broader notions of the general interest of the community. The emphasis is unmistakably shifting from the individual to the community. This modern trend in the social and political philosophy is well reflected and given expression to in our Constitution.'

In Raja Suriya Pal Singh v. State of U. P., 1952 SCR 1056 : (AIR 1952 SC 252), the following observation was made by Mahajan J :

'The expression 'public purpose' is not capable of a precise definition and has not a rigid meaning. It can only be defined by a process of judicial inclusion ana exclusion. In other words, the definition of the expression is elastic and takes its colour from the statute in which it occurs, the concept varying with the time and state of society and its needs. The point to be determined in each case is whether the acquisition is in the general interest of the community as distinguished from the private interest of an individual.'

5. I have taken trouble to quote from the opinion of these eminent Judges, because after the coming into force of the Constitution, land can only be acquired compulsorily for a public purpose and no other purpose. A reading of the Land Acquisition Act woola appear to indicate that land could, under this Act, be acquired both for a public purpose and for the purpose of a company which, strictly speaking, is a private purpose. The building of houses for poor men, for displaced persons or for industial workers is undoubtedly a purpose which advances the good of the State and of the community and in our times it would be considered a public purpose.

It is also to be observed that the scheme under which the land was acquired, was the Government of India subsidised Housing Scheme for Industrial Workers. It is, therefore, a scheme sponsored by the State, and, considered in this light, anything which is proposed to be done under this Scheme would tend to achieve a public purpose. I am, therefore, clearly of the view that in this case land was acquired for a public purpose.

6. The second point raised before us was that because in this case land was required for a company, the previsions of Part VII should have been complied with. A distinction was made between 'land required for a public purpose for the Government' and 'Land required for a public purpose for a company'. In the latter case (so it was argued) the provisions of Part VII must be complied with. The contention of the learned counsel for the appellants appears to be that under the Land Acquisition Act land can only be acquired for a public purpose and for no other purpose. But in some cases the land may be acquired for the Government and at the expense of the public revenues, while in other cases it may be acquired for a company, and in those cases the expense, partly or wholly, is borne by the Company.

Reliance was sought to be placed upon a number of decisions of the Allahabad High Court and a decision of the Calcutta High Court. The rulings of the Allahabad High Court are (1) Radha Raman v. State of Uttar Pradesh, AIR 1954 All 700, (2) R. L. Aurora v. State of Uttar Pradesh, AIR 1958 All 126, a Single Bench decision, and (3) R. L. Aurora v. State of Uttar Pradesh, AIR 1958 All 872, which is a decision given on appeal from case No. 2 above. The Calcutta case is Gurudas Saha v. First Land Acquisition Collector of Calcutta and others, AIR 1957 Cal 495. The sum and substance of these decisions appears to be that there is only one category of acquisition under the Land Acquisition Act, to wit, land required for a public purpose.

In AIR 1954 All 700, the Court was dealing with the acquisition of land for a co-operative housing society. Chaturvedi J. observed that because the land was being acquired for a company, it was necessary to observe the provisions of Section 40 and the other sections in Part VII, An agreement had been executed between the Government and the Co-operative Society and it was conceded that this agreement was the one contemplated by Sections 39 and 41. The question of whether land could be acquired for a company but not for a public purpose was not raised and, in fact, could not be raised in view of the provisions of Article 31 of the Constitution. Paragraph 12 of the report contains the following passage :

'The argument of the learned counsel is that the provisions of Sections 6 to 37 of the Act are not to be put in force in order to acquire land for any company unless the previous consent of the Government has been obtained, and the company has also executed an agreement mentioned in Section 41.'

The learned Judge was considering whether land acquired for the co-operative society could be said to be useful to the public and he came to the conclusion that this was so. In the second Allahabad case the learned Judge observed :

'The words 'for a company' under Clause (1) of Section 6 do not by themselves create a category of purpose for which acquisition can be made. The purpose for which an acquisition can be made is necessarily one for a public purpose. What the addition of the words 'for a company' in Section 6(1) means is that it is open to the appropriate Government to acquire the land for the benefit of a company but none-the-less the acquisition must be for a public purpose.'

When the case went up in appeal before a Division Bench this opinion was endorsed and the learned Judges made the following observation :

'Section 6 empowers the State Government to make a declaration that any particular land is needed for a public purpose or for a company. It is true that the phrase 'for a public purpose or for a Company' used in this and other sections of the Act suggests that the acquisition of land for a company need have no, relation to any public purpose, but this impression is in our opinion dispelled on reading the Act as a whole. All proceedings under the Act for the acquisition of land for a public purpose or for a Company begin with the issue of a preliminary notification under Section 4. That section contains no reference to the acquisition of land for a Company, and accordingly it follows that no land can be acquired for a Company unless such acquisition is, in the opinion of the State Government, for a ' public purpose.'

Before the Calcutta High Court in AIR 1957 Cal 495, the issue was raised directly and it was contended what the acquisition for companies could only be done if the provisions of Part VII of the Act were complied with. The learned Judge who wrote the judgment observed :

'Under Part VII of the Act, acquisition for the purposes of providing dwelling houses for workmen employed by a company or for the provision of amenities directly connected therewith is permitted. If it is not a public purpose, then compliance with Section 4 is impossible, and yet no acquisition can be effected without a notification under Section 4.'

7. There is thus considerable authority for the view advanced by the learned counsel for the appellants that compliance with the provisions of Part VII is obligatory in the case of all acquisitions for a company.' In the present case the acquisition was undoubtedly for the benefit of a company. I have given this matter my most anxious consideration, and, with great respect to the learned Judges, whose decisions have been noted above, I find myself unable to subscribe to the views expressed by them. It seems to me that their views were coloured by the background of the provisions of the Constitution. Article 31 of the Constitution prohibits compulsory acquisition of property for anything except a public purpose. Therefore, acquisition for anything which is not a public purpose cannot now be done compulsorily, but it has never been disputed that before the Constitution came into force land could have been acquired compulsorily by Government for a purpose which was not public. There is nothing in the Land Acquisition Act to warrant the assumption that the embargo placed by Article 31 of the Constitution found place in the Act. It seems to me that the Land Acquisition Act contemplates two categories of acquisition. The preamble of the Act says :

'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; it is hereby enacted as follows.'

If we examine carefully the phrase 'needed for public purposes and for companies', the repetition of the proposition 'for' makes it quite clear that the Legislature was dealing with two types of cases --(1) land needed for public purposes and (2) land needed for companies. This distinction is maintained throughout the Act. Section 4 does not speak of land required for companies at all but Section 38 provides that where a notification under Section 4 has to be issued in case land is required for a company, necessary alterations must be made in the wording of the notification. I shall, however, return to this topic presently. Section 6 makes mention of two types of acquisition.

It speaks of land needed for a public purpose or for a company. If acquisition could only be made for a public purpose, there was no need to use the phraseology employed in Section 6 and the word 'or' would not have been used in the phrase 'land is needed for a public purpose, or for a company'. Part VII deals with acquisition of land for companies. There is nothing in the Act to say that when land is required for a company it must also be for a public purpose. In fact, Section 40 mentions quite clearly what are to be the purposes which would warrantcompulsory acquisition for a company. Section 38is in the following terms:

'38. (1) The appropriate Government may authorize any officer of any Company desiring to acquire land for its purposes to exercise the powers conferred by Section 4.

(2) In every such case Section 4 shall be construed as if for the words 'for such purpose' the words 'for the purposes of the company' were substituted; and Section 5 shall be construed as if after the words 'the officer' the words 'of the Company' were inserted.'

In Sub-section (2) we find the distinction expressed in the must unequivocal manner. Here we have the expression 'for the purposes of the company' which is to be used in all cases where land is required for the purposes of the company. This purpose is distinct from and quite other than a public purpose. The two may overlap to some extent and the Legislature provided in Section 40 those conditions which must obtain before the Government would step in to lend its assistance in acquiring land for the purposes of a private company. These conditions show that the purposes must be somewhat akin or allied to public purposes.

If the company requires land for any purpose other than those mentioned in Section 40, then no compulsory acquisition under the Land Acquisition Act is possible, but Sections 38 and 40 make it quite clear that land in these cases is not being acquired for a public purpose. The learned Judges of the Allahabad and Calcutta High Courts found a difficulty in applying the provisions of Section 4 where land was required for the purposes of a company, but Section 38 provides the solution to this difficulty. Certain changes must be made in the notifications. The term 'public purpose' is not to occur and in its place 'for the purposes of the company' is to occur.

Instead of an officer of Government being appointed under Sub-section (2) an officer of the company will be given those powers. It is no doubt true that every acquisition must begin with a notification under Section 4, but this notification will be worded differently in those cases where land is required for the purposes of the company. I am conscious of the fact that I am taking a somewhat unorthodox view of the matter, but it seems to me that there is no escape from it. It must be remembered that the Land Acquisition Act came into force when there was no bar to compulsory acquisition for private purposes.

Such a bar was only imposed for the first time by Article 31 of the Constitution. If land could only be acquired for public purposes under the Land Acquisition Act, there was no point in enacting Part VII of the Act. The remaining provisions of the Act were quite sufficient to deal with all cases of acquisition whether the land was required by Government or by a company provided the purpose was a public one. In my view, Part VII is intended to cover those cases where the purpose of acquisition is private but for a company and where such purpose is similar to what are known as public purposes.

8. Thus it seems to me that the Land Acquisition Act deals distinctly with two categories of acquisition, namely, acquisition for a public purpose and acquisition for a private purpose of a restricted type, viz., acquisition for companies when the purposes are those mentioned in Section 40. I realise that in this view of the matter Part VII becomes redundant, but this consequence follows from the provisions of Article 31 of the Constitution. Any negation of Part VII does not in any way, diminish the effectiveness of the Land Acquisition Act All that need be shown now is that land is required for a public purpose.

The meaning of 'public purpose' has become somewhat more extensive in the changing pattern of our present-day society and the trend of judicial decisions is that and which is required for purposes which are mentioned in Section 40 would be deemed to be required for public purposes. There are a number of cases in which the need of a co-operative housing society has been held to be a public purpose, and I can see nothing dangerous or outrageous in holding that whenever land is required for a public purpose, even though the company is to bear all the expenses and use the land, there is no need to comply with the provisions of Part VII. The declaration under Section 6 would be made only after the Government is satisfied that the compensation is to be paid by the company where land is required for the benefit of the company. This section stands unaltered even if Part VII becomes null and void or redundant.

9. We thus find that in the present case land was acquired for a public purpose and the non-compliance (sic) with the provisions of Part VII was, therefore, wholly unnecessary.

10. Another argument raised before us was that because no notice under Section 9(1) was issued, the proceedings were bad. This matter was considered by the learned Single Judge and he took the view that he could not go into the facts. It has been urged on behalf of the Government that such a notice was issued. In any event, the omission to issue a notice is nothing more than an omission of a preliminary step and it cannot be said that by the non-issue of the notice the entire proceedings have been invalidated.

11. For these reasons I would hold that the purpose for which land was acquired in this case was a public purpose and even though the compensation was paid in its entirety by the company, the proceedings were valid, the notification under Section 6(1) was perfectly legal and the non-compliance with the provisions of Part VII of the Act in the matter of execution of an agreement as contemplated by Sections 39 and 41 docs not vitiate the proceedings, I would, therefore, uphold the decision of the learned Single Judge and dismiss this appeal with costs.

Dulat, J.

12. I agree.


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