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State of Madras Represented by the Collector of Tiruchirapalli Vs. Mahatmaji Manavar Unavu Viduthi, a Sociaty Registered Under the Provisions of the Societies Registration Act of 1860; No. 9 of 1955 Represented by the Secretary K.K. Veluswami Udayar - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Reported in(1976)2MLJ501
AppellantState of Madras Represented by the Collector of Tiruchirapalli
RespondentMahatmaji Manavar Unavu Viduthi, a Sociaty Registered Under the Provisions of the Societies Registra
Cases ReferredR. Vaidjalingam v. The Collector of Tiruchirapalli and
Excerpt:
- .....was made. this rs. 10,800 consisted of the grant made up of a sum of rs. 6,000 granted by the state government and the balance of rs. 4,800 by the central government. the society also made its contribution in the shape of labour etc. in putting up a decent structure. some time thereafter, some additional buildings were put up again with the aid of the government grant. some years thereafter to wit in 1959 there were certain reports against the normal working of the hostel. we are not, however, concerned in this case with the complaints laid against the management of the hostel as ultimately it happened that the government resumed the land and took possession of the buildings thereon, the former under the express power vested in them in clause 8 of the terms of the grant, exhibit a-2.....
Judgment:

T. Ramaprasada Rao, J.

1. 'Mahatmaji Manavar Unavu Viduthi', the plaintiff in O.S. No. 42 of 1967 was originally run under the private management of one K.K. Velusamy Udayar. In course of time, the institution expanded and consequent upon the institution's desire not to run with the then provision by the Government at Rs. 15 per mensem, it requested the Government in the year 1954 for the grant of Government land so that they could put up a decent building thereon for the purpose of running a hostel for the depressed classes. Then the management was asked to register the society under the Societies Registration Act so that they could avail themselves of the public grants which the Government would make in such circumstances. Accordingly, on 12th March, 1955, the plaintiff-society was registered and Mr. K.K. Velusamy Udayar was elected as the Secretary and Manager of that society. After registration, the society pursued its request for the grant of land and also for a loan to put up a decent building thereon and on 28th July, 1956, under Exhibit A-2, 39 cents of land was assigned or to use the normal expression used in such circumstances was 'alienated' in favour of the society for the avowed purpose of putting up a construction thereon and for running a hostel. On 21st September, 1956, a provision was made by the Government whereunder a grant of Rs. 10,800 was made. This Rs. 10,800 consisted of the grant made up of a sum of Rs. 6,000 granted by the State Government and the balance of Rs. 4,800 by the Central Government. The society also made its contribution in the shape of labour etc. in putting up a decent structure. Some time thereafter, some additional buildings were put up again with the aid of the Government grant. Some years thereafter to wit in 1959 there were certain reports against the normal working of the hostel. We are not, however, concerned in this case with the complaints laid against the management of the hostel as ultimately it happened that the Government resumed the land and took possession of the buildings thereon, the former under the express power vested in them in Clause 8 of the terms of the grant, Exhibit A-2 and the latter, as by then, became affixed to the land and formed part and parcel of the same. The Government, in or about July, 1959, laid down a policy to cover all subsidised hostels in the State by stages and for that purpose under G.O. Ms. No. 2312, Department of Industries, Labour and Co-operation, issued a notification to that effect and directed that 3 hostels in Madurai District recognised for grant of residential scholarships and detailed in items 21 to 23 of the Annexure to the above Government Order be taken over and run by Government during 1959-60. The Director of Harijan Welfare was requested to draw up a phased programme to take over all the remaining subsidised hostels within a specified period and submit the programme for the approval of the Government. The twentieth listed hostel in the annexure to the above Government Order is the plaintiff-society. Pursuant to this, the society was informed under Exhibit B-10 dated 9th June, 1959 that the management of the hostel would be taken over under the control of the Government shortly and that orders for taking over of the hostel would be issued separately. This was followed by Exhibit B-15 dated 13th June, 1959, which was the proceedings issued by the Collector of Tiruchirapalli. In this order, Exhibit B-15, the Collector refers to the general orders issued by the Government to resume Mahatmaji Manavar Unavu Viduthi (subsidised hostel) at Turajyur and demanded that the management should surrender possession of the buildings. But, unfortunately, the rule under which the power of requisition was being adopted was mot mentioned in the above proceedings. Ultimately, it happened that the Deputy Tahsildar took charge of the hostel, on 16th Jane, 1959, from the plaintiff. Aggrieved by the said actions which according to the plaintiff are neither proper nor legal, the plaintiff filed a suit in forma pauperis seeking for restoration of the building to the plaintiff-society. As no malpractices have been alleged against the society and as one of the buildings taken over by the Government from the society was constructed at the cost of Rs. 13,646. 68 P., the action of the Government in taking over the entire buildings including that constructed by the plaintiff without even an offer for compensation and without paying any compensation till the plaintiff-society came to Court, is highly inequitable besides being illegal. It was in those circumstances that the suit was filed. The Government in its written statement has taken up the position that the suit is not maintainable, that the hostel was taken over by the Government in public interest and for running the hostel departmentally and that in exercise of their powers under condition 8 of Exhibit A-2, the property was taken over and the land, where the buildings were constructed, is Government land alienated for a specific purpose and that the Government could acquire the same if they required it for a public purpose. The defendant would allege that the hostel was taken over only for a public purpose as the plaintiff could not run the hostel efficiently and in accordance with the avowed policy of the Government to take over such subsidised hostels and run the same for the benefit of the depressed classes to their advantage. They would refer to the hostel and the grant and would say that the Government also did contribute a major portion towards the construction of the buildings and as those buildings and that put up by the plaintiff did form one integral part, the Government had to take over the entire property after giving a prior notice to the hostel authorities. They would refute the claim of the plaintiff that it is entitled to recover possession of the lands and the properties taken over by the Government.

2. At this stage, we may refer to the relief asked by the plaintiff in the plaint. He only sought for redelivery of possession of the suit properties against the defendant and did not ask for a relief in the alternative for payment of such just compensation for the properties belonging to the society which were taken over by the Government without even offering compensation therefor.

3. The learned Subordinate Judge of Tiruchirapalli, on the above material pleadings, framed the following issues:

(1) Whether the suit as framed is not maintainable?

(2) Whether the plaintiff-society has ceased to exist and the suit is not maintainable?

(3) Whether the main building, was constructed without Government funds?

(4) Whether the additional blocks were constructed with 10 per cent, contribution of the plaintiff-society?

(5) Whether the land was assigned and not alienated and whether the Government is not entitled to take it over?

(6) Whether the taking over of the hostel by the Government is valid?

(7) Whether the plaintiff is entitled for possession of the plaint building?

(8) Whether the value of the building given in the plaint is correct?

(9) To what relief is the plaintiff entitled?

and held that the society did not become defunct as alleged by the defendant and the suit was maintainable and that the land was alienated to the plaintiff subject to certain conditions and terms and that the Government is entitled to take over the land subject to those conditions only, and after analysing the documentary evidence he was of the view that all the buildings constructed on the property are the properties of the plaintiff and as private property cannot be taken over by the Government unless with the aid of law, the taking over of the, plaintiff 's properties was illegal and relied on the decision of Srinivasan, J. in R. Vaidyalingam v. The Collector of Tiruchirapalli and Anr. W.P. Nos. 821 and 822 of 1963 The learned judge was emphatic that the entire suit properties were private properties and that, therefore, it cannot be taken over by the Government without paying compensation. He harped upon the text of Clause 8 of Exhibit A-2 and was of the view that as that clause also does not contemplate resumption of land and buildings without praying compensation, the act of the Government in having unilaterally taken over the properties, both movable and immovable of the hostel, is against law. He would not agree that even though the State Government laid down a policy to take over the management of subsidised hostels for ensuring better management and better benefit to the students belonging to the depressed classes, that cannot entitle the State Government to deprive citizens of private property and, in that context, upheld the contention of the plaintiff. He went further into the question as to whether the main building was constructed without Government funds and held that the main building was not constructed without the aid of the Government funds. On issue 4, whether the additional blocks were constructed with 10 per cent, contribution of the plaintiff-society, he held that the additional buildings were put up with the 10 per cent contribution made by the plaintiff and answered the issue accordingly. On the question whether the valuation of the building as given by the plaintiff was correct, the Court agreed with it, as no contrary material was placed before it to evaluate the building. He found issues 1, 2 and 5 to 7 in favour of the plaintiff and decreed the suit for possession with costs. It is as against this the present appeal has been filed. In the grounds of appeal inter alia the State Government referred to their power under Exhibit A-2 to resume the lands alienated by them either wholly or in part and that the said conditions can be invoked by paying the value of the building, if any, put up by the assignee. Before us, it is contended that as such grants and assignments are made under the Government Grants Act and as no law, the tenor of which would be contrary to or repugnant to the context of assumption or alienation, can have any effect provided the grant was under the Government Grants Act, the argument is that Clause 8 of the grant under consideration (Exhibit A-2) entitles them to resume the land for public purposes and irrespective of the absence of mal-administration by the, management of the hostel in the instant case, the exercise of their power under Clause 8 of Exhibit A-2 is proper and unquestionable. After citing certain authorities in support of the proposition that a public purpose is a matter which has to be decided subjectively by the Government which is the authority to decide as to whether one purpose is a public purpose or not, the learned Additional Government Pleader would say that when power was exercised under Clause 8 of Exhibit A-2 to take over the hostel in question belonging to the-plaintiff together with its buildings, the intention was to take over the hostel pursuant to the accredited policy of the Government and in order to improve the economic conditions of the inmates of such hostel. The learned Counsel for the respondent-plaintiff, however, would say that in the absence of any indication or reference in Exhibits B-14, B-10 and B-15 that the hostel was to be taken over in the purported exercise of the power under Exhibit A-2 and as the captions in the exhibits only refer to the positive fact that the Government wants to take over the hostels and the buildings, there has not been a proper exercise of power and, therefore, the taking over of the hostel properties is-bad. It is also made out that when D.W. 1 was examined on the side of the defendant, he did not even whisper that the taking over of the hostel premises-was pursuant to a public purpose and such reference to a public purpose in the written statement would not make any difference at all. Further, the argument proceeds that as no power to appropriate property of a private citizen can be put into motion, without a proper notice to that citizen and without the proper provision of law being invoked, the Clause 8 of Exhibit A-2 cannot vest in the Government the power to unilaterally act and take over the hostel and the building without even making an offer to compensate the plaintiff-society for such action oh the part of the State which resulted in at least a part of private citizen's property being deprived of and taken over without compensation.1 Reliance is again placed upon the decision of Srinivasan, J., referred to above.

4. The main question that arises for consideration in this case is whether the Government acted properly and in accordance with law when it took over the plaintiff's buildings and the hostel pursuant to the accredited policy of its to take over the hostels in the State to run it departmentally and on better and sound measures. For this purpose, it is necessary to go into the question of the terms of the grant by which the society was given possession of government land of the extent of 39 cents. It is not in dispute that this alienation was under the State Grants Act. One of the conditions of alienation which is relevant for the purpose may be extracted:

The Government may resume the land wholly or in part with any buildings thereon if in the opinion of the Government the land is required for a public purpose, or for conducting mining operations. In the event of such resumption or in the event of the acquisition of the land for any reasons the compensation payable for the land and the trees should in no case exceed the amount paid for by them by the grantee at the time of alienation or vestiture or their value at the time of resumption or acquisition whichever may be less together with the initial cost of the value at the time of resumption, whichever may be less or any buildings erected or other improvement effected on the land by the grantee in accordance with the terms of the grant. The amount of any grant made by the Government towards the cost of the building or other improvements shall be deducted from the compensation payable under the condition.

The Government, if it is of the view that the alienated land is required for a public purpose, can resume the land either wholly or in part with any buildings thereon. The clause, however, is silent about the payment of compensation to be made to the grantee at or about the time of resumption. The later portion of Clause 8, however, refers to such payment of compensation, but it does not make it obligatory on the part of the State Government to offer and pay such compensation payable to the citizen at or about the time when it resumes the land wholly or in part with the buildings thereon. The primary condition to be satisfied before the exercise of power under Clause 8 appears to be that there should be a public purpose which should prompt the State Government to act and secondly it should resume the alienated land together with the buildings thereon. There is, however, in Clause 8 itself an indication as to how the compensation has to be arrived at in cases where the grantees put up their own constructions-or improve the property after the grant was made. If, therefore, there is such a power in Clause 8 of the grant which would entitle the State Government to resume the land or acquire it under certain circumstances but only to sub-serve a public purpose, then the question is whether such power has been exercised properly in this case. Mr. Ratna Mudaliar, the learned Counsel for the respondent would say that as the society was running the hostel for a public purpose, the necessity for exercise of such power contemplated under Clause 8 has not arisen, for the public purpose openly proclaimed by the State Government as the purpose for which the hostel is being taken over, is to run it again as a hostel for the depressed classes. As one public purpose substitutes another public purpose, the argument is that the State Government did not have the requisite authority to act.

5. The above argument fails to take into consideration the essential ingredients in Clause 8 of Exhibit A-2. Whenever the State Government entertains subjectively an opinion that a particular property which it granted earlier under the Government Grants Act to a citizen is required for a public purpose of its own choice, then in our view it would not matter if the public purpose for which such resumption is thought of is similar to or parallel to the public purpose for Which the property is being used or utilised. If the subjective satisfaction of the State in the matter of deciding whether a particular property is needed for a public purpose is not normally justiciable, then it would be difficult for us to embark upon an investigation or enquiry into the propriety of such a public purpose. The only question that has to be looked into is whether the power is being exercised for a public purpose and if the public purpose put in the forefront is undoubtedly a public purpose and is in the public interest, then other considerations and comparative hardships would not come into the picture as it would be beyond the pale of investigation and enquiry. A similar question came up before the Supreme Court when it was considering the acquisition of private property under the provisions of the Land Acquisition Act. In Abdul Hussain v. State of Gujarat : [1968]1SCR597 the contention that when a particular land is being already used for one public purpose, the legislature could not have intended to empower the Government to destroy that purpose and substitute in its place another public purpose was not accepted by the Court. In R.L. Arora v. State of Uttar Pradesh : [1964]6SCR784 , the relevant facts may be stated before appreciating the ratio laid down by the Supreme Court. It was alleged that the petitioner therein was a businessman and was intending to use the land for erecting a factory.... It was also alleged that it could not be the purpose of the Act that land which was intended to be used for one public purpose should be acquired for another public purpose. While dealing with such facts and contentions, the Supreme Court said the intention of the previous owner whatever it may be does not in our opinion enter into question at all, so for as the validity of the acquisition is concerned provided the acquisition is for a public purpose.... Once the Government decides that the acquisition is needed for a public purpose, the subsequent action cannot be challenged on the ground that the previous owner himself intended to use the land for some public purpose.'

6. It is, therefore, seen that what is primarily required to judge whether the resumption of land under Clause 8 of Exhibit A-2 is for a public purpose is to test whether the Government has subjectively decided to resume the land and that too for a public purpose which is unmistakable by the invocation of common sense. We are, therefore, unable to agree with the learned Counsel for the respondent that as the power for which the State was resuming the land is more or less similar to the one to which the land and the buildings in the hostel are being put up, there is no occasion or necessity for the exercise of such power. The other contention of the learned Counsel for the respondent is that Exhibits B-14, B-10 and B-15 do not refer to the proceedings under which the power is sought to be exercised. But they only threaten the plaintiff that the buildings and the land would he taken possession of on a particular day and that the society should hand over clear physical possession of such properties. Exhibits B-4, B-10 etc., are only means to an end. They refer to a process deployed by the State in exercise of power. The fact that the relevant provision under which the power has been exercised has not been stated in the various forms and processes mentioned by the State to achieve their objective would not defeat the very purpose for which such steps were undertaken. We are only concerned with one aspect, namely, whether the State had the requisite authority under, any known provision of law to take over the hostel buildings. If such power could be traced to an indefeasible provision, may be under State grent or may be under any provision of statute theft the absence of any reference to it in the correspondence which ensued between the State and the grantee would not belie or belittle the exercise of such power which is admittedly vested in the State. We are, therefore, not agreeing with the contention of Mr. Ramachandran that the absence of any reference to Clause 8 in Exhibit A-2, in Exhibit B-14 or Exhibit B-10 would disentitle the Government from resuming the land.

7. Nextly, he referred to the testimony of D.W. 1. He would say that he did not refer to the expression 'public purpose' in his testimony. But, unfortunately, the cross-examination also is equally bald and uninstructive. There is not even a suggestion therein that the Government was acting without power. The counsel, therefore, cannot take advantage of the non-mention of the source of power under which the State acted when it is common ground that the State could exercise such power only under Clause 8 of Exhibit A-2 which in turn was a grant under the State Grants Act and which grant prevails over all the provisions which are inconsistent with the provisions of the grant. To make this part of the discussion complete, we may refer to Section 3 of the Government Grants Act which makes such grants to take effect according to their tenor. This section says that all provisions, restrictions, conditions and limitations over contained in any such grant or transfer shall be valid and take effect according to their tenor, any rule of law, statute or enactment of the legislature to the contrary notwithstanding'. This argument of the learned Counsel for the respondent, therefore, fails.

8. Strong reliance was placed upon the decision of Srinivasan, J. in R. Vaidjalingam v. The Collector of Tiruchirapalli and matter W.P. Nos. 821 and 822 of 1963. Prom a fair reading of the judgment of my learned brother, the if acts therein are entirely different. The hostel was started at Lalgudi, no doubt, over a plot of land allotted by the Government for the building of a hostel. A building was also put up with the aid and assistance of Government funds. In order to secure the performance of a condition that the society should refund to the Government a proportionate amount of the grant, the society was executing a mortgage deed in favour of the Government. This presupposes that the entire property which was later resumed by the Government was the property belonging to a private citizen. In those circumstance, Srinivasan, J., held that as no private property could be acquired without the invocation of the law relating to its such a talking over of the hostel premises was without authority. But in the instant case, the facts are different. It is nowhere claimed that the entire building or the land over which the building stood or the hostel campus of the plaintiff-society was the private property as it is normally understood. That property was a subject-matter of a Government grant which was subject to the special covenants and restrictions governing such grant. We have also referred to Clause 8 of the said grant. It empowered the State Government to resume the land for a public purpose. It is for a public purpose that the lands and buildings were resumed. Therefore, the question o1 approaching private property without authority of law does not arise in this case.

9. For all these reasons, therefore, we do not agree with the learned Subordinate Judge that there has been an abuse of power on the part of the State when the hostel properties were resumed.

10. The only surviving question for decision is as to the manner in which the plaintiff has to be compensated for the properties of his which were taken over by the Government without an offer for compensation at the time when they were taken over or at any time thereafter. It is fundamental that if composite property consisting of private property and property subject to a Government grant, is taken over under some process of law simultaneously it is but necessary that the private citizen should be compensated for that part of the property to which he contributed without reference to the Government funds. The learned Additional Government Pleader in the course of his argument tairly conceded that the Government as prepared to give compensation for such constructions and improvements and for such movable properties of the plaintiff-society which were taken over by them in 1959. The learned Judge, in his judgment, while referring to the general principles as to the payment of compensation and after evaluating the property on the basis of the materials before him, made no reference to it, but decreed the suit as prayed for It is unfortunate that the plaintiff did not seek for an alternative prayer. But, that would not prevent us from granting the relevant relief to which the plaintiff would be entitled. Though it is claimed that the entire buildings and the movables therein do belong to the Government, the learned Judge, after examining the material before him, came to the conclusion that certain additions and improvements were carried on to the existing1 building built partly at Government cost and that the main building was also constructed by the management of the hostel with Government aid. We are not inclined to disturb such finding of fact rendered by the Court below. While accepting the findings of the learned Subordinate Judge in the matter of the value of immovable properties as also the additions made from time to time, we remit the subject-matter of this appeal in so far as it relates to the payment of compensation by the defendant to the plaintiff and direct the learned Subordinate Judge to enquire into the following questions.

(1) What are the improvements done by the plaintiff to the property without reference to the Government funds or their aid?

(2) What were the immovable properties which were taken over by the Government when it took over the hostel premises pursuant to Exhibits B-14, B-10 and B-15?

(3) What would be the value of such additions and improvements done by the plaintiff and what would be the value of the movables belonging to the plaintiff at the time when the hostel was taken over by the Government?

(4) What, if any, was the contribution made by the plaintiff when the first and the additional buildings were put up and what would be the amount of compensation, if any, to which the plaintiff would he entitled to?

and after answering the above questions, pass a decree in terms of money directing the defendant to pay such compensation amount together with interest at 6 per cent per annum from the date, when the hostel was taken over, till date of payment. For this purpose, the plaintiff should be directed to pay additional Court-fee on the payment of which only he would be entitled to a decree. If the lower Court is of the view that additional pleading may be necessary for a decision on the above questions, he may give an opportunity to both the plaintiff and the defendant to file such pleadings. The parties may also be given liberty to adduce oral evidence in support of their respective case. The appeal is allowed in part and for a proper adjudication of matters and for the grant of the relevant relief to the plaintiff, the suit is remitted to the lower court for a fresh trial. There will be no order as to costs throughout. The Court-fee payable in the trial Court shall be borne by the defendant.


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