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Board of Trustees for the Improvement of Calcutta Vs. Calcutta Improvement Tribunal and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata High Court
Decided On
Case NumberA.F.O.O. No. 437 of 1974
Judge
Reported inAIR1975Cal87
ActsConstitution of India - Articles 14, 31(2) and 226; ;Calcutta Improvement Act, 1911 - Sections 69 and 70; ;Land Acquisition Act, 1894 - Section 23(1) and 23(2)
AppellantBoard of Trustees for the Improvement of Calcutta
RespondentCalcutta Improvement Tribunal and ors.
Appellant AdvocateShiba Santi Hajara and ;Arup Das, Advs.
Respondent AdvocateBhabani Prasun Chatterjee, Adv.
DispositionAppeal dismissed
Cases ReferredKesavananda Bharati v. State of Kerala
Excerpt:
- .....the functions of the court in reference to the acquisition of land for the board under the land acquisition act 1894 (hereinafter referred to as the tribunal). the acquisition of the lands in dispute was made under the calcutta improvement act, 1911 which incorporates some provisions of the land acquisition act, 1894 including section 23(1) and (2) subject to modifications provided therein.2. by section 74 (c) of the calcutta improvement (amendment) act. 1955 (west bengal act xxxii of 1955) which came in force on october 20, 1955 before sub-paragraph (2) of paragraph 9 of the schedule to the act, the following sub-paragraph was inserted-'paragraph 9. (1) sub-section (2) of section 23 shall be deemed to be omitted.' 3. the tribunal in the view that it was bound by the decision in.....
Judgment:

Datta, J.

1. This is an appeal against the judgment and order of Anil Kumar Sen, J. dated March 23, 1973 discharging the rule obtained by the Board of Trustees for the Improvement of Calcutta (hereinafter referred to as the Board) against an award made by the Tribunal constituted under Section 70 of the Calcutta Improvement Act. 1911 for performing the functions of the Court in reference to the acquisition of land for the Board under the Land Acquisition Act 1894 (hereinafter referred to as the Tribunal). The acquisition of the lands in dispute was made under the Calcutta Improvement Act, 1911 which incorporates some provisions of the Land Acquisition Act, 1894 including Section 23(1) and (2) subject to modifications provided therein.

2. By Section 74 (c) of the Calcutta Improvement (Amendment) Act. 1955 (West Bengal Act XXXII of 1955) which came in force on October 20, 1955 before sub-paragraph (2) of paragraph 9 of the Schedule to the Act, the following sub-paragraph was inserted-

'Paragraph 9.

(1) Sub-section (2) of Section 23 shall be deemed to be omitted.'

3. The Tribunal in the view that it was bound by the decision in Balammal v. State of Madras, : [1969]1SCR90 held the above provision omitting Section 23(2) from Clause 9 (1) of the Schedule to the Calcutta Improvement Act was unconstitutional and violative of Article 14 of the Constitution. The Tribunal accordingly awarded solatium of 15% as provided under Section 23(2) of the Land Acquisition Act in the awards for acquisition under its consideration.

4. The Board felt aggrieved by the grant of solatium of 15 % on the market value determined by the Tribunal and moved an application under Article 226(1) of the Constitution challenging the award on the ground inter alia that the Tribunal being a creature of the statute--the Calcutta Improvement Act, 1911-- it was not open to the Tribunal to hold that a particular provision of the statute was unconstitutional. It was also contended that the provisions of the Calcutta Improvement Act as amended were not unconstitutional nor violative of the provisions of Article 14 of the Constitution. On this application this Court issued a Rule which was contested by the reference claimants.

5. The learned Judge at the hearing of the rule followed the Bench decision of this Court in State of West Bengal v. Asitendra Nath Mitter, : AIR1973Cal478 in which it was held that paragraph 9 (1) of the Schedule to the Calcutta Improvement Act, 1911 infringes the equality clause in Article 14 ofthe Constitution and is void. It was further held in the judgment under appeal that the Tribunal had no jurisdiction to declare the provisions of the Act unconstitutional and it is obvious that at the time the award was made by the Tribunal there was no decision declaring the paragraph 9 (1) of the said Act unconstitutional and void. The Court however was of opinion that no useful purpose would be served by sending back the case to the Tribunal in view of the above decision as such action would be an inconsequential formality and no Court in writ jurisdiction should make any inconsequential order. The Court was not impressed by the contention that the decision referred to above required reconsideration. The Court also did not express any final opinion on the contention by the claimants that the Board had no locus standi to move the application. The rule along with other rules heard analogously were accordingly discharged and this appeal is against the said order.

6. Mr. Shiva Santi Hajara appearing with Mr. Arup Das, learned Advocates for the appellant Board contended firstly that the award under consideration was made by the Tribunal on August 11. 1970 while by the Amendment Act, XXXII of 1955 which came into force from October 20, 1955, Section 23(2) of the Land Acquisition Act was deemed to be omitted therefrom and was not to be taken into consideration in making the award. The Tribunal being a creature of the statute, it is urged, is confined to and required to act within the ambit and limits of the relevant Act as amended. The Tribunal had no competence or jurisdiction to award 15% solatium under Section 23(2) of the Land Acquisition Act, in the view it took that the omission of Section 23(2) was unconstitutional, following the decision in Balammal's case, : [1969]1SCR90 which was not a decision under the Calcutta Improvement Act 1911. The learned Judge while accepting this contention of the appellants was of opinion that in view of the Bench decision of this Court on the said Act, it would be an useless formality to send back the case to the Tribunal. Mr. Hajara submitted that if the award was without jurisdiction in so far as the grant of solatium is concerned and was in executable in law being a nullity, the same has to be quashed and fresh award to be made in accordance with law. Reliance was placed on the decision in K. S. Venkataraman & Co. P. Ltd. v. State of Madras, : [1966]60ITR112(SC) in which it was held that an authority created by a statute cannot question the vires of that statute or any of the provisions thereof where-under it functions. In Dhulabhai v. State of Madhya Pradesh, AIR 1969 SC 78the Court on a conspectus of the authorities observed:

'............ challenge to the provisionsof the particular Act as ultra vires cannot be brought before the Tribunals constituted under that Act. Even the High Court cannot go into that question on a revision or reference from the decisions of the Tribunals.'

7. Apart from the reasonings given by the learned Judge, with which we concur, it appears to us that the Tribunal took the view that in Balammal's case. : [1969]1SCR90 the Supreme Court was considering the vires of the provisions of the Madras City Improvement Trust Act. 1950 omitting the provision for payment of 15% solatium under Section 23(2) of the Land ACQUISITion Act, 1894, provisions whereof are largely in pari materia with the Act we are concerned with. As fine Supreme Court decided that the said provision was unconstitutional and void, the Tribunal took the view that the said decision would be applicable to the case before it under the Calcutta Improvement Act (hereinafter referred to as C. I. Act). Under Article 141 of the Constitution the law declared by the Supreme Court shall be binding on all courts within the territory of India. The Tribunal which under the Act is a Court observed that the Supreme Court in the Balammal's case laid down a proposition of law to the effect that when land can be acquired for public purpose by two parallel statutes and the provision in one deprives the owner of the solatium of 15% provided in the other statute such provision without more is discriminatory and in violation of Article 14 of the Constitution and as such void. The Tribunal held that the above proposition of law squarely applied to the statutes it was concerned with and accordingly the omission of the provision for solatium in the C. I. Act must be deemed as void in accordance with the above decision obviously in the light of the mandatory provisions of Article 141. For the same reason we are of opinion that the Tribunal committed no error in law in thinking that it had jurisdiction, in the circumstances, to award 15% solatium on the market value or that its award for that reason was a nullity.

8. Mr. Hajara next contended that the Tribunal made its award in absence of the Board without affording it any opportunity to present its case in violation of the principles of natural justice. Under Section 69 of the C. I. Act, the Board can acquire land under the provisions of the Land Acquisition Act, 1894 (hereinafter referred to as L. A. Act) which also provides for acquisition of land by local authority or Company through the Stateand under Section 17A inserted therein by C. I. Act, the Collector shall, upon payment of the costs of acquisition, make over charge of the land to the Board and the land thereupon shall vest in the Board subject to its liability to pay further costs required for the acquisition. Under Section 50(2) of the L. A. Act in any proceeding before the Court, the local authority may appear end adduce evidence for the purpose of determining the amount of compensation. It is obvious that in respect of acquisition of land by the Board which must be at its costs through the State the Board has to keep close laison with the State. The State was duly represented before the Tribunal where the Board had the opportunity to appear and adduce evidence if it so desired and to watch the proceedings. If the Board maintained no contact with the relevant authority of the State Government in connection with the acquisition in question and as a resultwas not aware of the proceeding beforehe Tribunal as alleged, it cannot be heard to complain that there was anyviolation of the principles of natural justice.

9. At this stage we shall consider an objection taken by Mr. Bhabani Pra-sun Chatterjee, learned Advocate for the reference claimants who contended that the Board has no right to dispute the award, as it is not entitled in law even to file an appeal against the award. He relied on the Bench decision in the Municipal Corporation of Pabna v. Jogendra Narain, (1909) 13 Cal WN 116 in which it was held that a company and Corporation for whose benefit any land may be acquired by the Collector is not a necessary party in the proceeding. It was further held that though provision under Section 50 is in the nature of an addition of a party simply for the purpose of watching the proceedings or assisting the State the Act gives no right of appeal to the Company or Corporation against award of the Court or of reference against the award of the Collector. In this case the referring claimants made a reference against an award under Section 18 without making the Secretary of State-in-Council a party although the Pabna Municipal Corporation was made a party. A decree was passed on this reference and on appeal this Court with the above observation remanded the case to the Court under Section 18 for making the Secretary of State-in-Council a party before it before determining the compensation as the directly interested party.

10. There can be no dispute that the Board is a party vitally interested in the determination of compensation as it has to bear the costs of acquisition. The Board has been given the right of its ownto appear and adduce evidence before the Tribunal. The relevant provisions for appeal are in general terms and do not expressely exclude the right of the Board to appeal from the decision of the Tribunal. It is difficult to conclude that no right of appeal has been provided to the party most vitally interested, even if the State is made party respondent, if not available as appellant. We need not however express any final opinion on the point, as it is not necessary for our purpose, which is to consider the right of the Board to move against the award in constitutional writ jurisdiction.

11. The Board has the legal right to acquire land for public purpose at its costs through the machinery of State on payment of compensation determined in accordance with law. If a determination of compensation, according to the Board is not in accordance with law, its legal right noted above is thereby seriously affected and, it appears to us, it will be entitled to move against such determination by appropriate proceedings under Article 226(1). We accordingly do not find any legal impediment in the Board's moving in this jurisdiction for adequate relief against an award which according to it is not in accordance with law in granting solatium not provided in the Act.

12. As to the vires of the provision of deleting Section 23(2) in determining compensation, the question has been finally settled in Asitendra Nath Mitter's case, : AIR1973Cal478 by a Bench decision of this Court with Which we respectfully agree. Mr. Hajara however contends that the Court's attention was not drawn to certain provisions of the C. I. Act, which will clearly indicate the rational classification between the two Acts having a reasonable relation to the object of acquisition sought to be achieved. He has drawn our attention to Section 78 which provides for abandonment of acquisition in consideration of a special payment by the owner to be fixed by the Board. He has also drawn our attention to Section 78A which provides for betterment fees on any land in the area comprised in the scheme which, not being required for its execution, is exempted from acquisition. He has also referred to Section 81 which provides for disposal of the land after acquisition. It however appears to us that Sections 78 and 78-A relate to lands which are not acquired and have no relevance while Section 81 relates to disposal of land after acquisition which also has no bearing.

13. Mr. Hajara has also referred to paragraph 9 (2) of the Schedule to the C. I. Act which inserts several clauses at the end of Section 23 of the L. A. Act.These clauses Lay down some principles in addition for determination of the market value under Section 23(1). These sub-clauses provide inter alia, that the market value of the land shall be the market value according to disposition of the land at the date of publication of notice under Section 43 (2) of C. I. Act for acquisition of land within its improvement scheme and in other cases date of notification under Section 4: increase of market value of land falling within or near a projected street to be disregarded: value of unauthorised erection or improvements not bona fide or special use of land or overcrowding of building to be disregarded in determining the market value. There are certain further provisions of compensation regarding interest acquired after material date as also relating to value buildings taken under acquisition.

14. The contention raised by Mr. Hajara is misconceived. It may be that different principles for determination of market value are provided in the C. I. Act but the same has no bearing on the question in controversy and solatium is not the market value of the land acquired as held in Union of India v. Ram Meher, : [1973]2SCR720 . The point for consideration is whether the reduction of the compensation by the C. I. Act from what is payable by the L. A. Act is supported by any rational classification having reasonable relation to the subject-matter or objects sought to be achieved by the C. I. Act, and is founded on some intelligible differentia. Lands can be acquired by the Board for public purpose under the Land Acquisition Act in which the owners will be entitled to 15% solatium if the same land is acquired under the C. I. Act also for public purpose, the owners would be deprived of the solatium of 15%. Such distinction is not supported by rational classification having reasonable relation with the subject matter of acquisition of Lands or the persons affected by the acquisition.

15. Even if it is possible to hold that the C. I. Act alone provides for acquisition of land by Board on the authority of the decision in Deputy Commr. and Collector Kamrup v. Durganath Sarma, : [1968]1SCR561 noted in the decision in Asitendra Nath Mitter's case, : AIR1973Cal478 , it must be held that differential treatment of Lands under L. A. Act and those under C. I. Act has no reasonable relation to the object of acquisition of Land for public purpose under the two statutes. As has been observed in Nagpur Improvement Trust v. Vithal Rao, AIR 1973 SC 689 (93-4) it was observed:

'Can classification be made on the basis of the authority acquiring the land?in other words can different principles of compensation be laid if the land is acquired by an Improvement Trust or Municipal Corporation or the Government? It seems to us that the answer is in the negative because as far as the owner is concerned it does not matter to him whether the land is acquired by one authority or the other.'

On a parity of reasoning the same principle will apply to the payment of solatium for acquisition of Land for public purpose so that the owner cannot be deprived of the solatium for Land acquired for such public purpose by the Board when the solatium would be payable for acquisition by State.

16. We shall now examine if the special provision deleting solatium indicates any rational classification having nexus to acquisition of land for public purpose. For the purpose we have to look into the statement of objects and reasons of the relevant amendment Act for incorporating the above provision in the C. I. Act. Such investigation is permissible in Law as observed in Jullundur Rubber Goods Manufacturers' Association v. Union of India, : [1970]2SCR68 in following words:

'Although it may not be permissible to take the statement of objects and reasons into consideration for construing the provisions of an Act the facts contained in such statement can be certainly looked at for the purpose of seeing any alleged infringement of Article 14.'

17. In the Statement of Objects and Reasons of tine relevant bill, resulting in the West Bengal Act XXXII of 1955, published in Calcutta Gazette Extraordinary of August 28. 1954 Part IVA page 1209, in regard to the omission of Section 23(2) in C. I. Act 1911, it is stated as follows:

'......Under Section 23(2) of theLand Acquisition Act, 1894, an additional fifteen per cent on the market value of the land acquired is payable in consideration of the compulsory nature of the acquisition. This extra allowance is considered to be both iniquitous and burdensome in the case of lands acquired by the Trust which is a public body functioning for public benefit. Section 23 of the Land Acquisition Act is therefore preferred to be amended by omitting Sub-section (2) (Clause 70 (c)). This is in conformity with other Acts and also the recommendation of the Local Finance Enquiry Committee.'

The above statement clearly indicates that the relevant provision is omitted from the C. I. Act on the ground that it is iniquitous and burdensome for a public bodywhich is also clearly applicable to acquisition of land by State for public purpose. This classification on the basis of authority acquiring the land again makes no difference to the expropriated owner. The differential treatment on solatium thus cannot be supported by any rational classification based on intelligible differentia having reasonable relation to the objects sought to be achieved by the statutes.

18. Mr. Hajara has next contended that the solatium represents an unearned income and is incompatible with the beneficent objects sought to be achieved by the Act for public benefit, end the directive principles of the Constitution. While it is incumbent to interpret the provisions of the statute keeping in view the objects it is intended to achieve and its subject matter, the discrimination caused by the omission of the solatium clause offending the fundamental right guaranteed by and not abrogated by the Constitution can hardly be overlooked and must override all other consideration urged by the Board or otherwise.

19. Mr. Hajara has lastly submitted that the provision for compensation in the C. I. Act omitting solatium is protected by Article 31(2) of the Constitution. Under the said provision the amount of compensation in the appropriated law for an acquisition or requisition of land shall not be called in question in any court, on the ground that the compensation so provided is not adequate. It may be mentioned that by the Constitution (Twentififth Amendment) Act,1971, which came into force on April 20.1972, in place of the (word) 'compensation' the word 'amount' has been substituted in Article 31(2) as the word 'compensation' according to judicial interpretation meant 'just equivalent' which was found iniquitous and burdensome. The amendment Act was not made retrospective in operation, so that the Constitution Amendment Act will not apply to the acquisition before us which took place in or about 1964 or earlier. This Article 31(2) as amended was held valid in the decision in Kesavananda Bharati v. State of Kerala, : AIR1973SC1461 . In construing Clause (2B) of Article 31 which was inserted by the same Amendment Act, providing that nothing in Sub-clause (f) of Clause (1) of Article 19 shall affect any land within the operation of Article 31(2), it was observed by Sikri, C. J. as follows (para 428):

'While passing a law fixing principles the legislatures are bound to provide a procedure for the determination of the amount and if the procedure is arbitrary that provision may well be struck down under Article 14.'

14

31(2)

14

31(2)

'The amended Article 31(2) does not remove the bar of Article 14. If the amount paid to the owner of the property is in violation of the principles of Article 14, the law may even now be struck down.'

For all these reasons we are of opinion that the relevant provision in the C. I. Act omitting solatium is not beyond the impact of Article 14 and is not protected by Article 31(2) as it stood prior to the. Twentififth Amendment of the Constitution and it appears even thereafter though we are not directly concerned with the amended provision.

20. As all contentions raised on behalf of the appellant fail this appeal is dismissed, But there will be no order for costs in the circumstances. As prayed for by Mr. Hajara, the operation of the order be stayed for a period of eight weeks from date.

Ray, J.

21. I agree.


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