LAND ACQUISITION

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Land Acquisition Under the Urgency Provisions — Need for Clarity in Law
by Arun Kumar Barthakur*
Cite as : (2002) 4 SCC (Jour) 37

Section 11-A of the Land Acquisition Act 1894 (for short "the Act") stipulates that the person whose land is acquired by the Government should be paid compensation within two years. Besides, sub-section (3-A) of Section 17 requires that eighty per cent of compensation as estimated by the Collector should be paid before taking possession. In Satendra Prasad Jain v. State of U.P.1 Bharucha, J. (as he then was), speaking for a three-Judge Bench of the Supreme Court, ruled that when land is acquired under the urgency provisions of the Act Section 11-A is not applicable. The Court further ruled that in such a situation the rule under sub-section (3-A) of Section 17 is also not mandatory. The ruling has thus resulted in the classification of landowners. This article addresses the question whether such a classification of persons, with the object of conferring or denying the right to receive the compensation within the statutorily fixed period of limitation provided under Section 11-A of the Act, based on whether the Government adopts the normal or urgency procedure of acquisition, passes the objective test of Article 14 of the Constitution. It also examines the question whether sub-section (3-A) of Section 17 of the Act is not mandatory.

In this case the State of Uttar Pradesh sought to acquire some lands for the public purpose of constructing a mandi at Barout in Meerut district. The notification under Section 4(1) read with Section 17(4) was published on 29-7-1986. The declaration under Section 6 was published on 24-10-1986 applying the provisions of Section 17(1). The landowners filed a writ petition impugning the acquisition proceedings in the Allahabad High Court. The Court dismissed the petition on 19-1-1987 holding that there was urgency in the public purpose for which the land was sought to be acquired and that the Krishi Utpadan Mandi Samiti, the acquiring body (the third respondent before the Supreme Court), had the means to construct the market yard and godowns. The Collector took possession of the land on 27-2-1987 without paying (i) the compensation, provided under sub-section (3) at the time of taking possession; and (ii) without paying eighty per cent of the estimated compensation for the land, before taking possession of the land, as provided under sub-section (3-A) of Section 17.

The award was not made even after a lapse of more than two years from 19-1-1987, the date of dismissal of the first writ petition filed by the landowners before the High Court of Allahabad. On the contrary, after a lapse of two and a half years from the publication of the notification under Section 4(1), the acquiring body recommended exclusion of the land from acquisition on the grounds of its unsuitability for the proposed mandi as it was far away, and paucity of funds. Against this backdrop, the landowners filed the second writ petition on 10-8-1989 now for issue of a writ of mandamus to the State Government to make the award. Meanwhile, the Land Acquisition Officer by his letter dated 27-6-1990 informed the acquiring body that despite his demands it had failed to pay the compensation for the land. As a result the proceedings lapsed, inasmuch as the period of limitation of two years prescribed by Section 11-A had expired on 18-6-1989, after excluding the time taken in the writ proceedings before the High Court.

The High court dismissed the writ petition holding that by the mere fact of possession having been taken in pursuance of Section 17(1), the necessity of making an award, as mandated by Section 11-A, within the period of two years from the date of publication of the notification under Section 4 could not be dispensed with. Thereupon, the landowners appealed to the Supreme Court. The State Government contested their claim setting up the pleas that possession was illegally taken by the Collector as eighty per cent of the estimated compensation, required to be paid to the landowners before taking possession under Section 17(3-A), was not paid to them; that more than two years having elapsed from the date of issue of the notification the entire acquisition proceedings lapsed by operation of Section 11-A; and that for keeping the landowners out of possession of the land the State Government could adequately compensate them under the provision of Section 5.

It is submitted that the above facts, first of all, ex facie, prove that the Collector had no jurisdiction to take possession of the land without complying with the two germane preconditions provided under sub-sections (3) and (3-A) of Section 17. Hence, the title of the land could not, by any stretch of interpretation, have vested in the Government. Secondly, the Collector had also lost his jurisdiction to continue with the acquisition as the entire proceedings had lapsed under Section 11-A. The fact that the Government had taken possession of the land, by invoking the urgency provisions under Sections 17(1) and (4), without paying even a single pie to the landowners; and that the acquiring body, Mandi Samiti, had recommended exclusion of the land from acquisition on the grounds of its unsuitability for the proposed mandi and paucity of funds needed for acquiring the land, ex facie, proved that there was no real urgency, which would not have brooked the delay of even 30 days provided for making the enquiry under Section 5-A. The Supreme Court's position is that:

"Save in real urgency where public interest does not brook even the minimum time needed to give a hearing land acquisition authorities should not, having regard to Articles 14 (and 19), burke an enquiry under Section 17 of the Act."2

These facts also prove that the Government did not apply its mind as required under sub-section (1) of Section 6 and the second proviso thereto about whether the Mandi Samiti had the adequate funds to pay the compensation for the land3 It is rather intriguing why the landowners did not impugn the proceedings on these grounds.

It may be argued in equity that the Government was estopped from questioning the proceedings taken by them on the grounds of their own omissions and commissions to deny the compensation for the land, taken over by them more than three years ago. The Government had also opposed the first writ petition filed by the landowners challenging the acquisition on various grounds. Bharucha, J. (as he then was), at SCC p. 375 para 17, observed:

"It is, at any rate, not open to the third respondent, who, as the letter of the Special Land Acquisition Officer dated 27-6-1990 shows, failed to make the necessary monies available and who has been in occupation of the said land ever since its possession was taken, to urge that the possession was taken illegally and that, therefore, the said land has not vested in the first respondent and the first respondent is under no obligation to make an award."

Be that as it may, the Court was required to decide the matter within the parameters of law, albeit tempered with equity in the circumstances of the case. As such, in view of the proceedings having lapsed by operation of Section 11-A, and possession having been taken without complying with the two germane preconditions provided under sub-sections (3) and (3-A) of Section 17, the Court should have declared the entire proceedings as ultra vires, and dismissed the appeal on the same grounds as the High Court4 As a court of equity, for doing justice to the landowners the Court could have also invoked its power under Article 142 of the Constitution directing the State Government to pay a reasonable compensation to the landowners for illegally keeping them out of possession of the land for over six years. Indeed this is what the State Government had proposed to do, though under Section 5 of the Act, which was not applicable. But in allowing the appeal Bharucha, J., relied on the ratio laid down in Lt. Governor H.P. v. Avinash Sharma5 where it was ruled thus:

"When possession of the land is taken under Section 17(1), the land vests in the Government. There is no provision by which land statutorily vested in the Government reverts to the original owner by mere cancellation of the notification."

Firstly, it is submitted that the qualifying word "mere" used in the said observation by Shah, J., is crucial. The Oxford Advanced Learner's Dictionary defines the word "mere" to mean "nothing more than; no better or more important than". The very meaning of the word "mere" used in the observation, therefore, suggests that something more would be required than cancellation of the notification to hold that the land had not vested in the Government under Section 17(1). It is respectfully submitted that the said observation does not appear to exclude by implication any jurisdictional grounds on which exercise of power under Section 17(1) could be held to be invalid, rendering taking possession of the land without jurisdiction. Secondly, prior to the commencement of the Land Acquisition (Amendment) Act, 1984 (Act 68 of 1984), there were no preconditions in Section 17 for exercising the power under sub-section (1) thereof and any limitation for making the award. But by Act 68 of 1984, Parliament substantially changed the position taken in Avinash Sharma4 by inserting the provisions of sub-sections (3), (3-A) and (3-B) in Section 17. These newly inserted provisions are reproduced below:

"17. (3) In every case under either of the preceding sub-sections the Collector shall at the time of taking possession offer to the persons interested compensation for the standing crops and trees (if any) on such land and for any other damage sustained by them caused by such sudden dispossession and not excepted in Section 24; and, in case such offer is not accepted, the value of such crops and trees and the amount of such other damage shall be allowed for in awarding compensation for the land under the provision herein contained.

(3-A) Before taking possession of any land under sub-section (1) or sub-section (2), the Collector shall, without prejudice to the provisions of sub-section (3),—

(a) tender payment of eighty per centum of the compensation for such land as estimated by him to the persons interested entitled thereto, and

(b) pay it to them unless prevented by some one or more of the contingencies mentioned in Section 31 sub-section (2),

and where the Collector is so prevented, the provisions of Section 31 sub-section (2), (except the second proviso thereto), shall apply as they apply to the payment of compensation under that section.

(3-B) The amount paid or deposited under sub-section (3-A), shall be taken into account for determining the amount of compensation required to be tendered under Section 31, and where the amount so paid or deposited exceeds the compensation awarded by the Collector under Section 11, the excess may, unless refunded within three months from the date of the Collector's award, be recovered as an arrear of land revenue." (emphasis supplied)

Let us now examine the implications of these new provisions. By enacting sub-section (3) Parliament made it obligatory on the Collector to pay compensation to the interested persons at the time of taking possession under either of the sub-section (1) or (2) for the standing crops and trees, if any, on such land and for any other damage caused by sudden dispossession. By enacting sub-section (3-A) Parliament made it obligatory on the Collector to tender payment of eighty per centum of the compensation for such land as estimated by him to the persons entitled thereto before taking possession of any land under sub-section (1) or sub-section (2). Parliament has, therefore, made the taking of possession under sub-section (1) or (2) a consequential proceeding to prior compliance with sub-sections (3) and (3-A). It will thus be seen that though prior to the Amendment Act, 1984, on taking possession of the land in the manner provided by sub-section (1) or (2) of Section 17, it would have vested absolutely in the Government, free from all encumbrances, with the commencement of the Amendment Act the position in this regard underwent substantial change; so that thenceforth the power could not be exercised under any one of sub-sections (1) and (2) without complying with sub-sections (3) and (3-A).

By using the expression "the Collector shall" in both provisions of sub-sections (3) and (3-A) Parliament has used compulsive language. On the use of the expression "shall" in Section 4(1) of the Rajasthan Land Acquisition Act, which is analogous to the Central Act, Subba Rao, C.J., in Khub Chand v. State of Rajasthan6 observed:

"The term 'shall' in its ordinary significance is mandatory and the court shall ordinarily give that interpretation to that term unless such an interpretation leads to some absurd or inconvenient consequence or be at variance with the intent of the legislature, to be collected from other parts of the Act."7 (emphasis supplied)

The compulsive language used in sub-sections (3) and (3-A), therefore, indicates in unmistakable terms that Parliament had made compliance with this provision absolutely mandatory before taking possession of the land. This is further made clear by another newly enacted provision in sub-section (3-B), which enjoins that while tendering the compensation under Section 31 after the award is made by the Collector under Section 11, the Collector shall take into account the amount already paid or deposited under sub-section (3-A). This sub-section also provides that where the amount so paid or deposited exceeds the compensation awarded by the Collector under Section 11, the excess may, unless refunded within three months from the date of the Collector's award, be recovered as an arrear of land revenue. It follows, therefore, that sub-section (1) or (2) and sub-sections (3) and (3-A) of Section 17 have to be read as an integrated provision requiring compliance with two conditions; the first, the Collector has to pay the compensation to the interested persons at the time of taking possession under either of sub-section (1) or (2) for the standing crops and trees, if any, on such land and for any other damage sustained by them caused by sudden dispossession; and the second, the Collector has to tender payment of eighty per centum of the compensation for such land as estimated by him to the persons entitled thereto before taking possession of any land under sub-section (1) or sub-section (2).

This view is supported by the rules of statutory construction.8 This is also supported by the general principle to the effect that the legislature does not enact anything irrelevant or contrary to purpose and without a definite objective in view.9 In Shri Balaganesan Metals v. M.N. Shanmugham Chetty10 the Apex Court observed that it is a settled rule of interpretation of statutes that provisions of an Act should be interpreted in such a manner as not to render any of its provisions otiose unless there are compelling reasons for the court to resort to that extreme contingency. Similarly, in Raja Satyendra Narayan Singh v. State of Bihar11 the Apex Court ruled that the basic principle of construction of every statute is to find out what is clearly stated and not to speculate upon latent imponderables. The scheme of the Act also must be looked into. Indeed, the object underlying the enactment of these new provisions of sub-sections (3) and (3-A) in Section 17 by the Amendment Act of 1984 is to alleviate the hardship caused to the expropriated persons by urgently taking possession of their lands without making the award. These provisions, therefore, confer a salutary benefit on the expropriated persons whereby an interim measure of relief is given to them before taking possession of their land without making the award. It is submitted that accordingly the provisions of sub-section (3) and (3-A) have to be construed to advance the policy of the legislation by extending the benefit conferred on the interested persons to receive the compensations referred to therein before taking possession of the land. It is submitted that any other construction, which has the effect of curtailing the benefit, shall be contrary to the intention of Parliament and hence untenable. It is submitted that there is nothing in the scheme of the Act, which militates against such a construction. On the other hand, a contrary interpretation would defeat the very scheme of the Act which the provisions of sub-sections (3) and (3-A) have so clearly intended. It is submitted that at times where emergency provisions are invoked emergent action may be taken but in such a situation in view of the law that was before it, Parliament has made a conscious change which cannot be explained away, merely because under Section 17(1) the title of the land vests absolutely in the Government.

It is, therefore, respectfully submitted that by Act 68 of 1984 Parliament had consciously made substantial change in the provision of Section 17 so that the interpretation of Section 17 given in Avinash Sharma4 became anachronistic on commencement of the said Amendment Act. However, relying on Avinash Sharma4, in Satendra Prasad Jain1 at SCC p. 375 para 17, Bharucha, J., observed:

"17. In the instant case, even that eighty per cent of the estimated compensation was not paid to the appellants although Section 17(3-A) required that it should have been paid before possession of the said land was taken but that does not mean that the possession was taken illegally or that the said land did not thereupon vest in the first respondent." (emphasis supplied)

The Oxford Dictionary defines the word "mandatory" to mean "required by law; compulsory". It is, therefore, submitted, with respect, that after holding Section 17(3-A) to be mandatory by implication, Bharucha, J. (as he then was), should not have ruled that non-payment of this amount did not render the acquisition illegal or that the title of the land did not vest in the Government. It is submitted with respect that in so concluding Bharucha, J., seems to have taken the provision of Section 17(1) in isolation in total disregard of the mandatory provisions of sub-sections (3) and (3-A). It is submitted that there is also a general principle propounding that the court is bound to observe the procedure prescribed by the statute. This principle was given effect to in Shri Mandir Sita Ramji v. Lt. Governor of Delhi12 It is regretted that Bharucha, J., could not give any cogent reason as to why the mandatory provisions of sub-sections (3) and (3-A) could be given a go-by.

As to why Section 11-A does not apply to cases of acquisition under Section 17, in Satendra Prasad Jain1 at SCC p. 374 para 15, Bharucha, J., explained the law thus:

"In the ordinary case, therefore, when Government fails to make an award within two years of the declaration under Section 6, the land has still not vested in the Government and its title remains with the owner, the acquisition proceedings are still pending and, by virtue of the provisions of Section 11-A, lapse. When Section 17(1) is applied by reason of urgency, Government takes possession of the land prior to the making of the award under Section 11 and thereupon the owner is divested of the title to the land which is vested in the Government. Section 17(1) states so in unmistakable terms. Clearly, Section 11-A can have no application to cases of acquisitions under Section 17 because the lands have already vested in the Government and there is no provision in the said Act by which land statutorily vested in the Government can revert to the owner." (emphasis supplied)

Bharucha, J., had relied on Avinash Sharma4 which, for reasons adduced above, became anachronistic with the commencement of Act 68 of 1984. Before the commencement of this Act there was also no statutory compulsion on the part of the Government to make the award within a time frame. But by Act 68 of 1984 Parliament inserted Section 11-A making it mandatory to make the award within the maximum period of two years from the date of making the declaration under Section 6(1). The object of this provision is spelt out in the Statement of Objects and Reasons attached to the Bill introducing the Land Acquisition (Amendment) Act, 1984, which in material part runs thus:

"... The pendency of acquisition proceedings for long periods often causes hardship to the affected parties and renders unrealistic the scale of compensation offered to them. ... It is proposed to provide for a period of two years from the date of publication of the declaration under Section 6 of the Act within which the Collector should make his award under the Act. If no award is made within that period, the entire proceedings for the acquisition of the land would lapse."

It is this objective which is reflected in Section 11-A which reads as follows:

"11-A. Period within which an award shall be made.—(1) The Collector shall make an award under Section 11 within a period of two years from the date of the publication of the declaration and if no award is made within that period, the entire proceedings for the acquisition of the land shall lapse:

Provided that in a case where the said declaration has been published before the commencement of the Land Acquisition (Amendment Act) Act, 1984, the award shall be made within a period of two years from such commencement.

Explanation.—In computing the period of two years referred to in this section, the period during which any action or proceeding to be taken in pursuance of the said declaration is stayed by an order of a court shall be excluded."

In this context it may be pertinent to note that earlier in Yusufbhai Noormohmed Nendoliya v. State of Gujarat13 a three-Judge Bench of the Apex Court had the occasion to interpret the provision of Section 11-A, and the Explanation thereto. In this case, the appellant's counsel argued that the expression "any action or proceeding" occurring in the Explanation should be interpreted differently when land was acquired under the normal procedure in contrast with the urgency procedure under Section 17. Kania, J., (as he then was), speaking for the Court, rejected this argument, and ruled thus:

"8. The said Explanation is in the widest possible terms and, in our opinion, there is no warrant for limiting the action or proceedings referred to in the Explanation to actions or proceedings preceding the making of the award under Section 11 of the said Act. In the first place, as held by the learned Single Judge himself where the case is covered by Section 17, the possession can be taken before an award is made and we see no reason why the aforesaid expression in the Explanation should be given a different meaning depending upon whether the case is covered by Section 17 or otherwise."14 (emphasis supplied)

It is submitted that this rule by implication indicates that Section 11-A with the Explanation thereto applies equally to the ordinary as well as the urgency procedure under Section 17 of the Act. As such, it is respectfully submitted that observation of Bharucha, J., in Satendra Prasad Jain1 that Section 11-A can have no application to cases of acquisitions under Section 17 is also per incuriam of the decision of the three-Judge Bench in Yusufbhai12.

In Yusufbhai12 the Supreme Court also held that Section 11-A enacts a beneficial provision. It should, therefore, be interpreted to safeguard the interests of the expropriated landowners irrespective of the procedure adopted for acquisition. It is submitted that even when Section 17 is invoked the Collector has to perforce make the award only under Section 11, as expressly provided under sub-section (3-B) of Section 17. Neither Section 11-A nor Section 17 provides any exception. This being the legal position, the Collector would have no jurisdiction to make the award under Section 11 beyond the limitation period provided by Section 11-A. Therefore, it is totally wrong to hold that Section 11-A is not applicable when the land is acquired under the urgency powers provided under Section 17. Indeed, when the Government takes away the land of the citizen without even making an award, the provision of Section 11-A should, proprio vigore, apply to such proceedings.

It appears Bharucha, J., gave much stress to the word "vest" occurring in Section 17(1). But taken in isolation, there is nothing absolute or magical in the word "vest" occurring in a statute; and, if the power of vesting the property in the Government has been exercised in "defiance or non-compliance with the essentials of the procedure" or in violation of the mandatory conditions prescribed by the statute15, or in fundamental mistake of fact16, such an act would be ultra vires and void. The import of the word "vest" in the context of the provisions of the Act could be further explained in the light of the decision in Fruit & Vegetable Merchants Union v. Delhi Improvement Trust17 wherein Sinha, J., speaking for a three-Judge Division Bench of the Supreme Court, observed:

"On the other hand, Sections 16 and 17 of the Land Acquisition Act (1 of 1894), provide that the property so acquired, upon the happening of certain events, shall 'vest absolutely in the Government free from all encumbrances'." (emphasis supplied)

It is submitted that the phrase "upon the happening of certain events" used in this observation makes it clear that vesting would not take place merely on taking possession of the land, and is predicated on the happening of all mandatory events in the manner prescribed by the Act prior to taking possession of the land. Therefore, under the normal procedure vesting would be predicated on the happening of the events contemplated under Sections 4, 5-A, 6, 9, 11 read with Section 11-A before taking possession under Section 16, and under the urgency procedure on the happening of the events contemplated under Section 4 read with Section 17(4), if applied, and Section 6 read with Section 17(1), Section 9, and sub-sections (3) and (3-A) of Section 17 prior to taking possession of the land under Section 17(1), and thereafter the events contemplated under sub-section (3-B) of Section 17 read with Sections 11 and 11-A of the Act. It is submitted that the above interpretation is supported by the settled law that if the Government takes possession of land in violation of the mandatory provisions of the law, under any Act, the possession will be without jurisdiction, and consequently title does not vest in the Government18

This view is also supported by the decision of the Supreme Court in Nutakki Sesharatanam v. Sub-Collector, Vijayawada19 In this case, the notification under Section 4(1) invoking the emergency clause under Section 17(4) and the declaration under Section 6 was published on the same date on 9-2-1976. But the substance of the notification was not published at the convenient places in the locality within the limitation of 40 days of the publication of the notification in the Government Gazette under Section 4(1) as amended by the Land Acquisition (A.P. Amendment and Validation Act, 1983). Kania, J., (as he then was), speaking for the Court, held that such non-compliance renders acquisition bad in law. He also ruled: "If the possession has been taken, the same must be returned to the appellant."20 This rule was reiterated in B. Kamalamma v. Sub-Collector, Vijayawada21 It was again reiterated in the decision of the three-Judge Bench, comprising Kania, C.J., Thommen, J., and Anand, J., (as he then was), in M.P. Housing Board v. Mohd. Shafi22

The above view is also fortified by the decision of the Apex Court in H.M.T. House Building Coop. Society v. Syed Khader23 wherein the Court quashed the notifications, the declarations and the awards made for vast tracts of lands on the ground of not taking the prior approval of the State Government as required under Section 3(f)(vi) of the Act, and directed restoration of possession of the lands to the respective landowners.

These cases indicate that merely because possession of the land was taken, title of the land would not, ipso facto, absolutely vest in the Government free from encumbrances. If any of the mandatory provisions of the Act which are conditions precedent to the exercise of power under Section 17(1) have not been complied with, the landowner would be entitled to restitution of the land illegally taken by the Government.

It is submitted that in Sargunam v. State of T.N.24 a Division Bench of the Madras High Court correctly interpreted Section 11-A in its application to Section 17. In this case Dr A.S. Anand, C.J., (as he then was) and Sathiadev, J., held as follows: (KLT Short Notes p. 7)

"In Section 11-A, there is no dichotomy made relating to acquisition under urgency provisions and non-urgency provisions. It is obligatory on the part of the Collector to pass an award within a period of two years from the date of publication of Section 6 declaration, irrespective of the nature of acquisition proceeding initiated by Government."

Their Lordships then held that even where Section 17 had been invoked, and the property statutorily vested in the Government, if the award was not passed within two years, revesting takes place by operation of law. The Court observed: (KLT Short Notes p. 8)

"There could be no legal impediment in revesting, because in such instances wherein the acquisition proceedings are declared illegal by courts, it would result in the title to the property reverting to the erstwhile owner. By operation of law, vesting takes place under Section 17(1). Hence equally, under Section 11-A, when there is a failure to adhere to the time-limit fixed therein, the entire acquisition proceedings shall lapse. The resultant effect will be the revesting takes place by operation of law." (emphasis supplied)

It is submitted that if the rule in Satendra Prasad Jain1 were applied it would also lead to constitutionally unacceptable results. To illustrate this, let us take two adjoining plots, each belonging to two different persons. Then suppose, one plot was being acquired for a public purpose under the normal procedure, and the other under the urgency procedure, and the declarations of public purpose for both the plots were made on the same day. Thereafter, suppose the Government took possession of the second plot under Section 17(1). Let us suppose, the Collector has failed to make the awards in respect of both the plots within the two year period of limitation provided under Section 11-A. Now, as per the rule in Satendra Prasad Jain1 the Collector would be functus officio in respect of the first plot, having no jurisdiction to continue further with the proceedings, and as such the first plot would revert to its owner, which he would be in a position to deal with in any manner he would like.25 But in case of the second plot, the Collector would still have the jurisdiction to continue further with the proceedings and would be authorized to make the award without any time limit whatever, thereby leaving the owner of the second plot in the lurch on the specious ground that the land had vested in the Government under Section 17(1) of the Act.

That such a classification of persons would be discriminatory is supported by the decision of the seven-Judge Constitution Bench of the Supreme Court in Nagpur Improvement Trust v. Vithal Rao26 wherein Sikri, C.J., ruled thus:

"Article 14 confers an individual right and in order to justify a classification there should be something which justifies a different treatment to this individual right. It seems to us that ordinarily a classification based on the public purpose is not permissible under Article 14 for the purpose of determining compensation. ... Can classification be made on the basis of the authority acquiring the land? ... 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.

It is equally immaterial whether it is one Acquisition Act or another Acquisition Act under which the land is acquired. If the existence of two Acts could enable the State to give one owner different treatment from another equally situated the owner who is discriminated against, can claim the protection of Article 14."27 (emphasis supplied)

In this case, a discrimination was sought to be made by applying the provisions of the Nagpur Improvement Trust Act which provided for payment of lower compensation compared to what was being provided in the Land Acquisition Act. The Court held such discrimination to be unconstitutional. Such being the constitutional position, can the Government propose that only if land is acquired under the normal provisions the Collector has to make the award within the two year period of limitation provided under Section 11-A, but not when it is acquired under the urgency provisions of the Act? It is submitted that an answer that shall be consistent with the mandate of Article 14 has to be in the negative because as far as the owner is concerned it does not matter to him whether the land is acquired under one procedure or the other. Therefore, it is submitted that a classification of persons to confer or deny the right to receive the compensation within the statutorily fixed time limit under Section 11-A, based on which of the procedures the Government adopts for acquisition of land shall be a constitutional anathema. It is submitted that such a classification is not founded on any intelligible differentia, nor has such a differentia a rational nexus with the object sought to be achieved, namely, compulsory acquisition of land for a public purpose28

No doubt Parliament has made a classification of persons based on whether their lands are acquired under the urgency provisions or the normal provisions of the Act; but such a classification is made only with respect to when the possession of their lands would be taken. The classification of persons made by Section 17 is, therefore, based on an intelligible differentia having a rational nexus with the object sought to be achieved, namely, compulsory acquisition of land for a public purpose which needs to be implemented urgently. But in view of the inequality of treatment, ex facie, implicit in taking possession of land of such persons before making the award vis-a-vis whose lands are taken under the normal provisions, Parliament had also adopted a special compensation principle for such persons by enacting sub-section (3-A) which mandatorily requires payment of eighty percent of the compensation for the land estimated by the Collector to the interested persons before taking possession of the land. Parliament has also made a special provision under sub-section (3-B) whereby the Collector is enjoined to adjust the compensation paid to the interested persons under Section (3-A) against the award to be made by him under Section 11 of the Act. Under Section 11-A the Collector has the jurisdiction to make the award only within the period of limitation of two years from the date of publication of the declaration. Neither in sub-section (3-B) of Section 17 which provides for making the award under Section 11 nor under Section 11-A any exception is provided for giving any differential treatment to cases of acquisition under the urgency provisions. As such, it appears to be clear that the power of the Collector under Section 11 to make the award in such cases is also circumscribed by the limitation provided under Section 11-A of the Act. It is, therefore, respectfully submitted that the decision in Satendra Prasad Jain1 is not correct.

The provision of Section 17 once again, with respect, was wrongly interpreted by the Division Bench comprising Ramaswamy, J., and Venkatachala, J., in P. Chinnanna v. State of A.P.29 In this case, the Government of Andhra Pradesh initiated acquisition of some land on behalf of Bhainsa Regulated Market Samiti. The Samiti wanted the land for extending its cotton market yard. On receipt of the request of the Samiti, the Government treating it as a case of urgency on 6-7-1977 made an order under sub-section (4) of Section 17 directing that the provisions of Section 5-A shall not apply. Following this, the appropriate Government on 21-7-1977 published a notification under Section 4(1) read with sub-sections (1) and (4) of Section 17. The appropriate Government also made the declaration under Section 6(1) on the same date. Thereafter, the Collector published notice under Section 9(1), and took possession of the land on 10-7-1978, that is, nearly a year after the date of the Section 4(1) notification, and delivered possession of the said land to the Market Samiti. Thereupon, the interested persons filed writ petitions in the High Court of Andhra Pradesh, praying for quashing the notification under Section 4(1) and the declaration made under Section 6(1) on various grounds.

The High Court had noted that though the Gazette notification was made under Section 4(1) on 21-7-1977, dispensing with Section 5-A enquiry by invoking sub-section (4) of Section 17, possession of the land was taken only on 10-7-1978, that is, after nearly one year. In the circumstances, the High Court observed: (SCC p. 489, para 2)

"This circumstance is alone sufficient to show that the invoking of the emergency clauses to dispense with Section 5-A enquiry is done mechanically."

In this view of the matter the Court allowed the petition and set aside the order dated 6-7-1977 passed by the Government under Section 17(4) dispensing with Section 5-A enquiry. The High Court also directed the officer concerned to hold enquiry under Section 5-A and to commence the proceedings from that point.30

There is another reason why the proceedings in this case were illegal. Earlier, in State of U.P. v. Radhey Shyam Nigam31 the Apex Court laid down that after amendment of Section 17(4) in 1984, a declaration as contemplated by Section 6 could be made only after the date of publication of the notification under Section 4(1), "meaning thereby subsequent to the date of the publication of the notification"32 But in Chinnanna28 the notification under Section 4(1) read with Section 17(4) dispensing with the enquiry under Section 5-A and the declaration under Section 6(1) were published simultaneously on the same day on 21-7-1977. As such, the declaration was ultra vires Section 17(4) and void, and the Government was not entitled to take possession of the land33 Now, after the High Court had set aside the said order of the appropriate Government under Section 17(4) dispensing with the enquiry under Section 5-A, which was the foundation of all subsequent proceedings, the proceedings of the declaration made under Section 6(1) by dispensing with the enquiry under Section 5-A, and taking possession of the land after issuing the notice under Section 9(1) were rendered without jurisdiction. In pursuance of the said order of the High Court, the Collector conducted an inquiry under Section 5-A and thereafter, sent the requisite report to the appropriate Government, which, thereafter, made the declaration under Section 6(1) on 29-11-1984 for the land belonging to the appellants. It is submitted that the Government was right in making the fresh declaration after conducting the inquiry under Section 5-A, in accordance with the order of the High Court34 Venkatachala, J., it is submitted with respect, was wrong in holding that the declaration dated 29-11-1984 was unwarranted, just because possession of the land was taken by the Government in exercise of power under Section 17(1), which as aforesaid was without jurisdiction. In the premises, it is respectfully submitted that in Chinnanna28 Section 17(1) was not correctly interpreted.

Another similar decision on this point is U.P. Jal Nigam v. Kalra Properties (P) Ltd.35 In this case, the notification under Section 4(1) read with Section 17(4), dispensing with the enquiry under Section 5-A, was published on 8-3-1973. Possession of the land was taken on 5-7-1973 much before making the declaration of public purpose under Section 6(1) published on 9-10-1973. Yet another notification was published on 24-3-1973 for some other land whose possession was taken on 5-7-1973 before making the declaration of public purpose under Section 6(1) published on 8-7-1973. In both cases, no award was made even after expiry of two years after the coming into force of the Amendment Act, 1984. As such, possession was, prima facie, not validly taken and consequently the land had not vested in the State Government. However, rejecting the legal pleas raised by the interested persons Ramaswamy, J., inter alia, observed:

"It is further settled law that once possession is taken, by operation of Section 17(2), the land vests in the State free from all encumbrances unless a notification under Section 48(1) is published in the Gazette withdrawing from the acquisition. Section 11-A, as amended by Act 68 of 1984, therefore, does not apply and the acquisition does not lapse. ... There is no other provision under the Act to have the acquired land divested, unless, as stated earlier, notification under Section 48(1) was published and the possession is surrendered pursuant thereto."36 (emphasis supplied)

For the reasons adduced above, it is submitted that, prima facie, the acquisition was ultra vires the provisions Sections 6(1), 9(1) 11-A and sub-sections (1), (2) and (4) of Section 17. Possession of land, which was admittedly taken even before making the declaration and publishing the requisite notice under Section 9(1), was patently ultra vires Section 17(1) and an abuse of the powers given by the Act. Firstly, Ramaswamy, J., with respect, failed to appreciate Section 17(1) in proper perspective, and secondly erred in ignoring the stipulation contained in that provision itself that the Collector may take possession of the land on expiration of fifteen days after publication of the notice under Section 9(1). It is not understood, with respect, how Ramaswamy, J., had observed that on the service of notice under Section 9 possession was taken, since urgency was acute. Needless to say that the Collector gets the jurisdiction to publish the notice under Section 9 only pursuant to making the declaration under Section 6(1) and taking order for acquisition under Section 7 from the appropriate Government. Moreover, Ramaswamy, J., with respect, also erred in holding that once possession was taken, by operation of Section 17(2) the land vests in the Government free from all encumbrances. It is pertinent to note that prior to Act 68 of 1984 power under Section 17(2) extended only to taking immediate possession of land for any railway administration for the maintenance of their traffic or for the purpose of making thereon a river-side or ghat station, or of providing convenient connection with or access to any such station owing to any sudden change in the channel of any navigable river or other unforeseen emergency. In the instant case, however, the land was admittedly not acquired for any Railway Administration, and hence Section 17(2), as it stood in 1973, could not have been invoked. It is also pertinent to note that even then the extant provision of Section 17(2) enjoined the Collector to take previous sanction of the appropriate Government before immediately taking possession of land. However, it is not noticed that Section 17(2) was at all invoked while publishing the notification under Section 4(1) read with Section 17(4), and whether the Collector had taken previous sanction of the Government before taking possession of the land. Ramaswamy, J., with respect, had also erred in holding that "there is no other provision under the Act to have the acquired land divested, unless, as stated earlier, notification under Section 48(1) was published and the possession is surrendered pursuant thereto" (SCC p. 127, para 3)(emphasis supplied). Now, if the land had absolutely vested in the State Government consequent to taking possession under Section 17(1), where was the scope for withdrawing the acquisition under Section 48(1)? Because, under Section 48(1) the Government can withdraw from the acquisition of any land only if possession has not been taken, and not afterwards37

It is submitted, with respect, that the decisions of the Apex Court on this point in Awadh Bihari Yadav v. State of Bihar38, Pratap v. State of Rajasthan39 and Allahabad Development Authority v. Nasiruzzaman40 were mere reiteration of the principle laid down in Satendra Prasad Jain1 which was founded on the ratio of Avinash Sharma4. For reasons adduced above, the ratio of Avinash Sharma4 became anachronistic and therefore not applicable to cases after commencement of Act 68 of 1984, which inserted the provisions of sub-sections (3) and (3-A) by way conditions precedent to the exercise of power under Section 17(1), and Section 11-A, which made it mandatory to make all awards under Section 11 within the limitation period of two years from the date of making the declaration under Section 6(1). Besides, Satendra Prasad Jain1 was also per incuriam of Yusufbhai12 and hence not correctly decided. All these decisions have rendered otiose the provisions of sub-sections (3) and (3-A) of Section 17, and Section 11-A in the context of the urgency provisions. Besides, these decisions also made a classification of persons to confer or deny the right to receive the compensation within the statutorily fixed time-limit under Section 11-A, based on whether the Government adopts the normal or the urgency procedure for acquisition of land. Such a classification is not founded on any intelligible differentia, nor has such a differentia a rational nexus with the object sought to be achieved, namely, compulsory acquisition of land. This ruling has, therefore, resulted in manifest injustice to those whose lands are acquired under the urgency procedure. It is submitted with respect that Dr A.S. Anand, C.J., (as he then was) and Sathiadev, J., of the Madras High Court in Sargunam23 had correctly interpreted the provision of Section 11-A vis-a-vis Section 17 holding that Section 11-A applies irrespective of the nature of the proceedings, and that if vesting takes place under Section 17(1), equally revesting would take place under Section 11-A by operation of law. Therefore, the conclusion of law in Satendra Prasad Jain1 and all the aforecited subsequent decisions, which merely relied on it, with our utmost respect, is not correct. There is, therefore, a strong reason for reconsideration of all these decisions by a five-Judge Constitution Bench to straighten the law.

*   MA, PHDFM, LLB, Advocate, Bombay High Court Return to Text

1. (1993) 4 SCC 369 Return to Text
2. State of Punjab v. Gurdial Singh, (1980) 2 SCC 471, at p. 477, para 16 Return to Text
3. See Narayan Govind Gavate v. State of Maharashtra, (1977) 1 SCC 133, 139 Return to Text
4. See in this connection, State of Jammu and Kashmir v. Sanahullah Mir, (1980) 3 SCC 272, where at pages 277-78, paras 11 and 12, it was ruled that the State can challenge the acquisition proceedings even in a suit if the proceedings are wholly ultra vires and the award was a nullity, as a result of gross negligence or deliberate act on the part of its officials (SCC, p. 276 para 9) and in such cases the plea of estoppel shall not apply. Return to Text
5. (1970) 2 SCC 149, at p. 152, para 8 Return to Text
6. AIR 1967 SC 1074, at p. 1077, para 6 Return to Text
7. Ibid., at p. 1077 Return to Text
8. Maxwell on Interpretation of Statutes, 12th Edn., pp. 251-52 Return to Text
9. See Ram Niwas v. Mithan Lal, AIR 1979 P&H 262, 266; Hundraj Kanyalal Sajnani v. Union of India, 1990 Supp SCC 577, 597; State of Kerala v. Mathai Verghese, (1986) 4 SCC 746 Return to Text
10. (1987) 2 SCC 707, 713 Return to Text
11. (1987) 3 SCC 319, 325 Return to Text
12. (1975) 4 SCC 298. In this case Justice Mathew observed at p. 300 thus: "When a procedure is prescribed by the legislature, it is not for the court to substitute a different one according to its own notion of justice. When a legislature has spoken, the Judges cannot afford to be wiser." Return to Text
13. (1991) 4 SCC 531 Return to Text
14. Ibid., p. 535, para 8 Return to Text
15. Ram Swarup v. Shikar Chand, AIR 1966 SC 893, 898-897 Return to Text
16. Ajudh Raj v. Moti, (1991) 3 SCC 136, 139 Return to Text
17. AIR 1957 SC 344, 353 Return to Text
18. See Luchmeswar v. Chairman, Darbhanga Municipality, ILR (1890) 18 Cal 99 (PC); Gaekwar v. Gandhi, ILR (1902) 27 Bom 344 (PC); Rameswar v. Secy., ILR (1907) 34 Cal 470 (AC); Ramrao v. State of Bombay, AIR 1963 SC 827; Collector of Kamrup v. Kamakhya Ram Barooah, AIR 1965 SC 1301 Return to Text
19. (1992) 1 SCC 114 Return to Text
20. Ibid., p. 116, para 6 Return to Text
21. JT (1992) 1 SC 55 Return to Text
22. (1992) 2 SCC 168. In this case land was sought to be acquired under Section 17 dispensing with the enquiry under Section 5-A, but the notification under Section 4(1) was found to be defective, and the substance thereof was not published at the convenient places in the locality as required. Therefore, at p. 173 para 8, the Court ruled thus: "If a notification under Section 4 (1) of the Act is defective and does not comply with the requirements of the Act, it not only vitiates the notification, but also renders all subsequent proceedings connected with the acquisition, bad." Return to Text
23. (1995) 2 SCC 677 Return to Text
24. (1990) 2 KLT 7 (SN) : (1990) 1 LW 259 Return to Text
25. Please also see Govt. of T.N. v. Vasantha Bai, 1995 Supp (2) SCC 423, 424 Return to Text
26. (1973) 1 SCC 500 Return to Text
27. Ibid., p. 507, paras 29-30 Return to Text
28. 28 See Om Prakash v. State of U.P., (1974) 1 SCC 628, 633. Also see Kedar Nath Singh v. State of Bihar, AIR 1962 SC 955, 969, where the Apex Court ruled: "It is well settled that if certain provisions of law construed in one way, would make them consistent with the Constitution, and another interpretation would render them unconstitutional, the court would lean in favour of the former construction." Also see U.P. Avas Evam Vikas Parishad v. Jainul Islam, (1998) 2 SCC 467, where it was ruled that the provisions of the Land Acquisition Amendment Act 1984 (Act 68 of 1984) were applicable to acquisition of land under the Uttar Pradesh Avas Evam Vikas Parishad Adhiniyam 1965 as otherwise, the compensation payable to the owner whose land is acquired under the Adhiniyam would be less than the compensation payable to the owner whose land is acquired under the LA Act as amended by the 1984 Act, which would be offensive to Article 14 of the Constitution. Return to Text
29. (1994) 5 SCC 486 Return to Text
30. This view of the High Court finds support in the decision in Babu Singh v. Union of India, (1981) 3 SCC 628, where Justice Desai at pp. 633-34 observed: "It may be that after invoking the power under Section 17 proceeding for acquisition dragged on and possession is not taken, it may reflect upon the exercise of power under Section 17. It may indicate that there was no urgency and there is colourable exercise of power." Return to Text
31. (1989) 1 SCC 591 Return to Text
32. Ibid., p. 601. Return to Text
33. Ibid., pp. 594 and 602 Return to Text
34. Ibid., p. 602 Return to Text
35. (1996) 3 SCC 124 Return to Text
36. Ibid., p. 127, para 3 Return to Text
37. Rajasthan Housing Board v. Shri Kishan, (1993) 2 SCC 84 Return to Text
38. (1995) 6 SCC 31 Return to Text
39. (1996) 3 SCC 1 Return to Text
40. (1996) 6 SCC 424 Return to Text