1. These petitions raise an interesting question whether acquisition of land for construction of houses for members of a Co-operative Housing Society can be said to be an acquisition for a public purpose. The facts giving rise to these petitions follow a common pattern and it would, therefore, be sufficient if we set out the facts of only one petition, namely, Special Civil Application No. 180 of 1965. The petitioner in this petition is the owner of a piece of land situate in Ahmedabad. There is a Society called Patel Baug Co-operative Housing Society Limited, (hereinafter referred to as the Society) registered under the Bombay Co-operative Societies Act, 1925. It is a Co-operative Housing Society formed with the object of enabling its members to construct houses. The petitioner's land being well situate, the Society moved the State Government to acquire the petitioner's land for construction of houses by its members and the State Government accordingly issued a notificated dated 13th April 1961 under Section 4 stating that the petitioner's land was likely to be needed for a public purpose, namely, 'for construction of houses for members of Shri Patel Baug Co-operative Housing Society Ltd., Ahmedabad'. Within thirty days of the issue of this notification, the petitioner filed his objections against the proposed acquisition of his land and the Collector, after holding an inquiry, made his report to the State Government under Section 5A, sub-section (2). The State Government, after considering the report, issued a notification dated 27th August 1964 under Section 6 declaring that the petitioner's land was needed to be acquired at the public expense for the purpose specified in column 4 of the Schedule, namely, 'for a housing scheme undertaken by Shri Patel Baug Co-operative Housing Society Ltd., Ahmedabad, with the sanction of the Government'. These words were obviously taken from the extended definition of 'public purpose' introduced in Section 3 (f) by the Land Acquisition (Bombay Amendment) Act, 1948. Though this statement of the public purpose in Section 6 notification was worded slightly differently from that contained in Section 4 notification, the case of the respondents was that there was no difference in substance, as the housing scheme referred to in Section 6 notification was a housing scheme for the members of the Society and not for the public. The petitioner thereupon filed Special Civil Application No. 180 of 1965 challenging the validity of the acquisition sought to be made by the State Government. Similar petitions were also filed by other petitioners challenging the validity of the acquisitions sought to be made for other Co-operative Societies, namely, Malaya Co-operative Housing Society Limited in Special Civil Application No. 181 of 1965, Sanyojan Co-operative Housing Society Limited in Special Civil Application No. 635 of 1965 and Anupam Co-operative Housing Society Limited in Special Civil Application No. 845 of 1965.
2. Though several grounds were taken in the petitions for challenging the validity of the acquisitions, only one was pressed at the time of arguments and that was that there was colourable exercise of power on the part of the State Government in issuing the impugned Section 6 notifications since the purpose for which the acquisition was made in each case, namely, construction of houses for members of the Society was ex facie a private purpose and what the State Government was satisfied about was, therefore, not a public purpose but a private purpose and the declaration contained in the impugned Section 6 notifications was colourable as being outside the scope of the power conferred on the State Government under the Act. This ground was resisted by the respondents and a twofold answer was sought to be given to it. One was that the declaration in the impugned Section 6 notifications that the purpose for which the acquisition was made was a public purpose was conclusive and it was not open to the petitioners to assert or establish to the contrary and the other was that, in any event, in the context of the facts set out in the affidavit-in-reply, the purpose of construction of houses for members of a Co-operative Society was a public purpose and the acquisition in each case was, therefore, supported by a public purpose. These rival contentions we shall now proceed to consider.
3. It is well settled law that once a declaration is made under Section 6, sub-section (1), it is conclusive not only in regard to the question of need but also in regard to the question whether the purpose for which the land is needed is a public purpose. As pointed out by the Supreme Court in Somavanti v. State of Punjab, AIR 1963 SC 151:
'It is the existence of the need for a public purpose which gives jurisdiction to the Government to make a declaration under Section 6(1) and makes it the sole judge whether there is in fact a need and whether the purpose for which there is that need is a public purpose. The provisions of sub-section (3) preclude a Court from ascertaining whether either of these ingredients of the declaration exists'.
If the purpose for which the land is being acquired by the State is within the legislative competence of the State, the declaration of the Government is conclusive and it is not open to the petitioner to contend that the purpose is not a public purpose. But this proposition is subject to one exception and that exception is, to quote again from the decision of the Supreme Court in Somavanti's case, AIR 1963 SC 151 (supra): -
'........If there is a colourable exercise of power the declaration will be open to challenge at the instance of the aggrieved party. The power committed to the Government by the Act is a limited power in the sense that it can be exercised only where there is a public purpose, leaving aside for a moment the purpose of a company. If it appears that what the Government is satisfied about is not a public purpose but a private purpose or no purpose at all the action of the Govt. would be colourable as not being relatable to the power conferred upon it by the Act and its declaration will be a nullity'. If the purpose for which the acquisition is made is clearly and manifestly a private purpose the inference would be irresistible that in making the declaration the State Government has failed to apply its mind or misapprehended the true meaning and import of what is a public purpose or taken into account extraneous or irrelevant considerations for otherwise it could never have stated that the land is needed for a public purpose. The action of the Government in such a case would be colourable as not being relatable to the power conferred upon it under the Act and the acquisition would be bad. It is, therefore, clearly permissible to the petitioners notwithstanding the declaration to show, if they can, that the purpose of construction of houses for members of a Co-operative Society is not a public purpose but a private purpose. As a matter of fact, this inquiry is permissible also for another reason. The words in which the public purpose is expressed in the impugned Section 6 notifications are borrowed verbatim from the extended definition of 'public purpose' introduced by the Land Acquisition (Bombay Amendment) Act, 1948, and the argument of the petitioners, therefore, was that it was by reason of this extended definition that the purpose for which acquisition was made was a public purpose. But this extended definition was ab initio void as the entire Land Acquisition (Bombay Amendment) Act, 1948, was declared ultra vires by the Supreme Court in Jeejeebhoy v. Assistant Collector, Thana : 1SCR636 and the satisfaction of the State Government was, therefore, vitiated and could not afford any foundation for issuing the impugned Section 6 notifications. This argument was combated on behalf of the respondents and it was urged that the satisfaction of the State Government was not based on the extended definition of 'public purpose' but the State Government was satisfied aliunde and, therefore, even if the extended definition was void, it did not affect the validity of the acquisition. Now it is evident that if the purpose of construction of houses for members of a Co-operative Society is manifestly not a public purpose it would considerably fortify the inference that the State Government must have relied on the extended definition of 'public purpose' for the purpose of reaching the opinion that this purpose is a public purpose and that would greatly support the argument of the petitioners. It is, therefore, necessary for this reason also to inquire whether the purpose of construction of houses for members of a Co-operative Society can be said to be a public purpose.
4. That raises the question: what is a public purpose? The expression 'public purpose' as pointed out by Mahajan J., in State of Bihar v. Sir Kameshwar Singh : 1SCR1020 'is not capable of precise definition and has not a rigid meaning. It can only be defined by a process of judicial inclusion and exclusion'. However a broad test has been formulated by judicial decisions and it is that -
'Whatever furthers the general interest of the community as opposed to the particular interest of the individual must be regarded as a public purpose'.
This test is by its very nature elastic and it is as well that it should be so. So diverse and varied can be the activities, engagements and operations which may redound to the general benefit of the public and in which the general interest of the public can be said to be really involved that it is impossible to expect a definition exclusive or inclusive which will aptly meet every particular objective within the matrix of public purpose and yet not fail in some circumstances. But the basic concept underlying the expression 'public purpose' is general interest of the community. Now in every field of economic activity individual interest in its ultimate consequence is necessarily related to the general interest of the community. Any economic activity which primarily serves individual interest would also ordinarily in its operation and effect tend to benefit the community. Take for example an individual who deals in textile goods for profit. His activity though carried on primarily and exclusively for his private benefit must inevitably result in benefit to the community, as by such activity textile goods would become available to the members of the community and their need would be supplied. But that does not make the activity a public purpose. There must be something more - some characteristic which distinguishes a public purpose from a private purpose. The purpose to be a public purpose must be one which is primarily or predominantly for the general benefit of the community. It is not enough that it benefits the community incidentally for, as stated above, every economic activity is bound to have that effect. It must be mainly and primarily designed to serve public interest and though in its implementation it may incidentally benefit particular individuals, such incidental benefit to private individuals would not convert it into private purpose. The test which has, therefore, to be applied is whether the purpose is one which is primarily and predominantly one for the general interest of the community or it is mainly or primarily to serve the interest of a few individuals. Is the emphasis on the general benefit of the community or is it on the benefit of some specified individuals? If it is the former, it would be a public purpose but not so, if it is the latter. That is the only way in which a line can be drawn to distinguish a public purpose from a private purpose. The difference between the two can become recognizable and meaningful only if this interpretation is accepted. And this interpretation is clearly borne out by the classic statement of 'public purpose' given by Batchelor J., and approved by the Privy Council in Hamabai Framjee Petit v. Secy. of State for India. 42 Ind App 44 = (AIR 1914 PC 20), where it was said that--
the phrase, whatever else it may mean, 'must include a purpose, that is, an object or aim, in which the general interest of the community, as opposed to the particular interest of individuals, is directly and vitally concerned'.