M/s. Delhi Airtech Services Pvt. Ltd. & Anr. vs State of U.P. & Anr.

Pvt. Ltd. & Anr. ... Appellants

Versus

State of U.P. & Anr. ... Respondents

J U D G M E N T

Swatanter Kumar, J.

1. I had the advantage of reading the well-written judgment

of my learned brother, A.K. Ganguly, J. Regretfully but

respectfully, I am unable to persuade myself to concur with

the findings recorded and the exposition of law expressed by

my learned brother. In order to discernly state the reasons for

my expressing a contrary view and dismissing the appeals of

the appellants on merits, it has become necessary for me to

state the facts as well as the law in some detail. It has been

necessitated for the reason that complete facts, as they appear

2

from the record and the facts which were brought to the notice

of the Court during the course of hearing by the respondents,

supported by the official records, duly maintained by them in

normal course of their business, have not, in their entirety,

and correctly been noticed in the judgment. I am also of the

considered view that, in fact, the questions framed

(particularly question `D') in the judgment by my learned

brother neither so comprehensively arise in the facts and

circumstances of the present case nor were argued in that

manner and to that extent before the Court. Be that as it

may, I consider it necessary to restate the facts, deal with

different legal aspects of the case and then record the

conclusions which would even provide answers to the

questions framed by my learned brother at the very beginning

of his judgment. Before I proceed to do so, let me briefly but,

inter alia, state the reasons for my taking a view contrary to

the one recorded in the judgment of my learned brother:

I. I have already stated that complete and correct facts,

in their entirety, as they emerge from the records

3

produced before the Court (including the trial court

record) as well as the documents referred to during

the course of arguments by the respondents have not

been correctly noticed. The records referred to have

been maintained by the authorities in the normal

course of their business and their authenticity can

hardly be questioned. These documents have been

executed inter se various institutions/departments,

including the Collector's office, who discharges quasi-

judicial functions under the Act.

II. The judgment of this court in the case of Satendra

Prasad Jain & Ors. v. State of U.P. & Ors. [AIR 1993

SC 2517 = (1993) 4 SCC 369], in my humble view,

cannot be ignored and the principle stated therein

cannot be avoided on the ground that the judgment

was sub silentio. This I say so, for the reason that it

is not a decision in which the point was not raised,

argued and perceived by the Court. On the contrary,

the issue in relation to the consequences of non-

4

payment flowing from Section 17(3A) of the Land

Acquisition Act (for short, the `Act') was specifically

noticed by the three-Judge Bench in paragraph 11 of

the judgment. It was discussed in some detail and a

definite finding was recorded thereby bringing the

judgment well within the dimensions of good

precedent. Thus, I, with respect, would prefer to

follow the larger Bench judgment rather than ignoring

the same for the reasons stated by my learned brother

in his judgment do not apply in the facts of the

present case.

III. The ratio decidendi of the judgment of this Court in

the case of Satendra Prasad Jain (supra) is squarely

applicable to the present case, on facts and law.

IV. It has not been correctly noticed in the judgment that

80 per cent of due compensation, which even the

appellants did not dispute during the course of

hearing, had not been tendered or paid to the

claimants, as contemplated under Section 17(3A) of

5

the Act. From the facts recorded hereinafter, it is

clear that within the prescribed period, the payments

were deposited with the State office of the

Collector/competent authority and it was for the State

to distribute the money in accordance with the

provisions of the Act. It is not only the scheme of the

Act but also an established practice that the amounts

are disbursed by the Collector to the claimants and

not directly by the beneficiary, for whose benefit the

land had been acquired. The beneficiary had

discharged its obligation by depositing, in fact, in

excess of 80 per cent of due compensation with the

competent authority. De hors the approach that one

may adopt in regard to the interpretation of Section

17(3A), on facts the notification is incapable of being

invalidated for non-compliance of the said Section.

V. The doctrine of strict construction does not per se

mandate that its application excludes the

simultaneous application of all other principles of

6

interpretation. It is permissible in law to apply the

rule of strict construction while reading the provisions

of law contextually or even purposively. The golden

rule of interpretation is the rule of plain language,

while preferring the interpretation which furthers the

cause of the Statute rather than that which defeats

the objects or purposes of the Act.

VI. Non-providing of consequences under Section 17(3A)

of the Act, in contradistinction to Sections 6 and 11 of

the same Act, in my considered view is largely the

determinative test for proper and judicious

interpretation of Section 17(3A).

VII. The judgment by my learned brother does not

consider the judgments of the Constitution Bench,

the larger Bench and even the equi-Bench, which

have to some extent a direct bearing on the matters in

issue before us. In this regard, reference can be made

to the Constitution Bench judgment of this Court in

the case of Offshore Holdings Pvt. Ltd. v. Bangalore

7

Development Authority & Ors. [(2011) 3 SCC 139], the

three-Judge Bench judgment in the case of Tika Ram

& Ors. v. State of U.P. & Ors., [(2009) 10 SCC 689] and

particularly the judgment of another equi-Bench of

this Court in the case of Banda Development

Authority, Banda v. Moti Lal Agarwal & Ors. [2011 (5)

SCALE 173], to which my learned brother (Ganguly,

J.) was a member. The latter case, inter alia, dealt

with a question of lapsing of proceedings under

Section 11A on the ground that the possession of the

property had not been taken as required under that

provision. While rejecting such a contention in that

case, the Court observed that if the beneficiary of the

acquisition is an agency or instrumentality of the

State 80 per cent of the total compensation is

deposited in terms of Section 17(3A) and substantial

portion of the acquired land has been utilized in

furtherance of the particular public purpose, it could

reasonably be presumed that the possession of the

acquired land had been irrevocably taken. The Court

8

then held that relief to the appellants (like the

appellants in the present case) of invalidating the

acquisition proceedings and restoring the land could

not be granted.

VIII. The 44th Constitutional Amendment, on the one hand,

omitted Article 19(1)(f) and Article 31 while

introducing Articles 31A and 300A to the Constitution

of India on the other. Right to property was deleted

as a fundamental right in the Constitution. Thus,

this right cannot be placed on equi terms,

interpretatively or otherwise, to the pre-constitutional

amendments. The right to eminent domain would

operate on a different sphere, interpretation and

effect, pre and post constitutional repealments of

these Articles and introduction of Article 300A of the

Constitution. Even on this aspect, I respectfully

disagree with the conclusions recorded by my learned

brother (Ganguly, J.).

FACTS:

9 2. Appellant No.1 is a company duly incorporated under the

provisions of the Indian Companies Act, 1956 and is alleged to

be the owner of the land sought to be acquired by the

respondents. The land of the appellant, admeasuring about 2-

06-1/3-0 Bighas situated in Village Haldauni, Tehsil and

Pargana Dadri, District Gautam Budh Nagar, which is an

abadi land, was sought to be acquired by the appropriate

Government under a notification dated 17th April, 2002 issued

under Section 4(1) read with Sections 17(1) and 17(4) of the

Act. This land was acquired for the planned industrial

development in District Gautam Budh Nagar through the New

Okhla Industrial Development Authority (NOIDA). The

notification also stated that the provisions of Section 5A of the

Act shall not apply. In pursuance to the said notification, a

declaration under Section 6 of the Act was published on 22nd

August, 2002, declaring the area which was required by the

Government. It also stated that after expiry of 15 days from

the date of the publication of the notification possession of the

acquired land shall be taken under sub-section (1) of Section 9

of the Act. The appellants have alleged that they did not

10

receive any notice under Section 9(1) of the Act but possession

of the land was nevertheless taken on 4th February, 2003.

According to the appellants, even after lapse of more than

three and a half years after publication of declaration under

Section 6 of the Act, the award had not been made and

published.

The appellants also alleged in the petition that, despite

inordinate delay, they were neither paid 80 per cent of the

estimated compensation in terms of Section 17(3A) of the Act

at the time of taking of possession, nor had the Collector

passed an award within two years of making the declaration

under Section 17(1), as required by Section 11A of the Act. It

was the case of the appellants in the writ petition that this has

the effect of vitiating the entire acquisition proceedings. Non-

payment of the compensation and conduct of the Government

compelled the petitioners to file a writ petition in the High

Court of Allahabad praying for issuance of an order or

direction in the nature of certiorari or any other writ, not to

create any encumbrance or interest on the land of the

11

petitioners. Further, they prayed that the acquisition

proceedings, in so far as they relate to the land of the

petitioner, be declared void ab initio and that the respondents

be directed to return the land from the possession of the

Government to the owners. Lastly, the petitioners prayed that

the respondents/Government be directed to pay damages for

use and occupation of the land.

To this writ petition, the respondents had filed a counter

affidavit in the High Court, denying that the acquired land was

in fact a part of the abadi land. The respondent-authority has

also stated that 80 per cent compensation in terms of Section

17(3A) of the Act had been deposited with the authorities. The

land had been acquired for planned development of NOIDA

and was in the physical possession of the said authority.

Possession of the land had been taken on 4th February, 2003

and no right had survived in favour of the petitioners as the

land vested in the Government.

The High Court, vide its judgment dated 28th August,

2006, dismissed the writ petition. The High Court relied upon

12

the judgment of this Court in the case of Satendra Prasad Jain

(supra) and dismissed the petition holding that the provisions

of Section 11A of the Act are not attracted to proceedings for

acquisition taken by the Government under Section 17 of the

Act. However, liberty was granted to the petitioners to pray for

grant of appropriate compensation in accordance with law

before the competent forum.

Aggrieved by the said order of the High Court, the

appellants have filed the present appeal impugning the

judgment dated 28th August, 2006.

In the counter affidavit filed by respondent No.2 before

this Court, the submissions made before the High Court have

been reiterated with an additional fact that the sector in

question was designated as industrial area and after the

development activity was completed, allotment has been made

and possession of these industrial plots has also been handed

over to such entrepreneurs/allottees. This land falls under

Sector 88 of the NOIDA City. The rest of the allegations made

13

in the writ petition, except the dates in question, have been

disputed.

It has also been stated at the Bar, on the basis of the

record maintained in regular course of its business by the

respondent-authority, that 10 per cent of the estimated

compensation was deposited by the Authority with the State

Government even prior to the date of the notification under

Section 4(1) read with Section 17(4) of the Act, issued by the

Government, i.e., 17th April, 2002. The remaining 70 per cent

of the estimated compensation had allegedly been deposited

vide cheque dated 8/14th July, 2002 amounting to

approximately `6,66,00,000/-. As such, there is complete

compliance with the provisions of Section 17(3A) of the Act by

the authority concerned. The Award was made on 9th June,

2008, which has been accepted by a large number of owners,

i.e., 97.6 per cent of all owners. Some of these facts have also

been averred in the counter affidavit filed before the High

Court.

14 From the above pleadings of the parties, the admitted

facts that emerge from the record can be usefully

recapitulated. The Governor of the State of Uttar Pradesh on

17th April, 2002, issued a notification under Section 4(1) of the

Act, expressing the intention of the Government to acquire the

land stated in the said Notification for a public purpose,

namely, for the planned industrial development in District

Gautam Budha Nagar through NOIDA. Vide the same

notification the emergent provisions contained in Section 17 of

the Act, specifically Section 17(4), were also invoked,

intimating the public at large that the provisions of Section 5A

of the Act shall not be applicable. After issuance of the

declaration under Section 6 of the Act, admittedly the

possession of the land in question was taken on 4th February,

2003. However, it remains a matter of some dispute before the

Court as to whether 80 per cent compensation, which is

deposited by the beneficiary with the State, had actually been

received by the land owners/claimants, if so, to what extent

and by how many.

15 The Collector had not made or published the award even

at the time of pronouncement of the judgment of the High

Court, in Writ Petition No. 22251 of 2006, on 28th August,

2006. The High Court, in the impugned judgment, has

directed the respondent No.1 to ensure that the Award is made

as early as possible, preferably within a period of three months

from the date of production of the certified copy of that order.

In the counter affidavit filed before this Court, it has been

stated by the State of Uttar Pradesh that the Award was finally

made and published on 9th June, 2008. According to the

appellant, given the fact that the declaration under Section 6

of the Act was dated 22nd August, 2002, then in terms of

Section 11A of the Act, the acquisition proceedings had lapsed

as the award ought to have been pronounced on or before 21st

August, 2004.

Discussion on objects and reasons of the Act

With the enormous expansion of the State's role in

promoting public welfare and economic development since

independence, the acquisition of land for public purposes, like

16

industrialization, building of institutions, etc., has become far

more numerous than ever before. This not only led to an

increase in exercise of executive powers, but also to various

legislative amendments to the Act. The 1870 Act abolished the

system of uncontrolled direction by arbitrators and in lieu

thereof, required the Collector, when unable to come to terms

with the persons interested in the land which it desired to

acquire, to refer these differences to the Civil Courts. It was

also felt necessary by the framers, to restructure the legislative

framework for acquisition of land so that it is more adequately

informed by this objective of servicing the interests of the

community in harmony with the rights of the individual.

Various amendments were made and certain new provisions

added to the Act by Amendment Act, 68 of 1984, which took

effect from 24th September, 1984. Amongst others, Sections

11A and 17(3A) of the Act were new provisions added by this

enactment. The objects and reasons for amending the Act

were to bring a greater degree of harmony between the

interests of the owners of the land, on the one hand, and the

acquiring authority on the other. In its recommendations, the

17

Law Commission also expressed a view that individuals and

institutions, who are unavoidably deprived of their property

rights, need to be adequately compensated for their loss

keeping in view the sacrifice they have had to make in the

larger interests of the community. The pendency of acquisition

proceedings for long periods causes hardship to the affected

parties; so steps were required to be taken to truncate the

procedural aspect of acquisition proceedings on the one hand,

and to pay adequate compensation to the owners of the land

on the other. By introducing the provisions of Section 11A of

the Act to the normal course of acquisition proceedings,

greater responsibility was intended to be fastened upon the

concerned authorities, whereby they were obliged to make an

award within two years of the declaration made under Section

6 of the Act. The other obvious purpose of the amendment

was that before emergency provisions are invoked by the State

and possession is taken in terms of Section 17(1) of the Act, as

opposed to the normal procedure of acquisition of land where

possession is taken after the making of an award, it was to be

obligatory upon the authorities concerned to pay 80 per cent

18

of the estimated compensation to the land owners, prior to

taking possession of the land in terms of Section 17(3A) of the

Act. Despite the fact that Right to Property in terms of Article

19(1)(f) of the Constitution stood deleted from Chapter III of

the Constitution, vide 44th Constitutional Amendment, 1978,

Article 300A of the Constitution was added by the same

Constitutional Amendment, mandating that `no person shall

be deprived of his property save by authority of law'. This

indicates that the Constitution still mandates two aspects in

relation to acquisition of land by the exercise of power of

eminent domain vested in the State. Firstly, such acquisition

has to be by the authority of law; in other words, it has to be

in accordance with the law enacted by the competent

legislature and not by mere executive action. Secondly, there

has to be a public purpose for acquisition of land and the

person interested in such land would be entitled to

compensation.

The objects and reasons for introducing the Bill leading

to the Amendment Act 68 of 1984, have explained the

19

amendments made to the Act. It is not necessary for us to

dwell upon all the amendments carried out in the Act. Suffice

it to refer to the amendment made in the definition of `public

purpose' under Section 3(f) of the Act and to the provisions of

Sections 11A and 17(3A), with which this Court is primarily

concerned in the present case. If I may put it in rather simple

language, the object of the legislation was to create greater

balance between the exercise of power of eminent domain by

the State and the owner's deprivation of his property by way of

compulsory acquisition and the greater acceptability of

acquisition proceedings amongst land owners. This balance is

sought to be created by introducing higher responsibility and

statutory obligations upon the acquiring authority.

Expeditious and proper payment of fair market value for the

acquired land to the claimants is required in the light of

sacrifice made by them in the larger public interest.

In the case of Devinder Singh & Others v. State of Punjab

and Others [(2008)1 SCC 728], a Bench of this Court took the

view that the provisions of the Act should be strictly

20

construed. Referring to the provisions of the Act, it spelt out

the ingredients of valid acquisition to be, (a) the existence of a

public purpose; and (b) the payment of requisite

compensation. In cases of acquisition of land for a private

company, the existence of a public purpose is not necessary

but all other statutory requirements were held to remain

imperative in character, requiring strict compliance.

Whether the provisions of Sections 17(3A) and 11A of the

Act are mandatory or directory and to what effect?

Let us first examine the general principles that could

help the Court in determining whether a particular provision

of a statute is mandatory or directory.

In `Principles of Statutory Interpretation', 12th Edition,

2010, Justice G.P. Singh, at page 389 states as follows:

"As approved by the Supreme Court: "The

question as to whether a statute is

mandatory of directory depends upon the

intent of the Legislature and not upon the

language in which the intent is clothed.

The meaning and intention of the

legislation must govern, and these are to

be ascertained not only from the

phraseology of the provision, but also by

21

considering its nature, its design and the

consequences which would follow from

construing it the one way or the other"

"For ascertaining the real intention of the

Legislature", points out Subbarao, J, "the

court may consider inter alia, the nature

and design of the statute, and the

consequences which would follow from

construing it the one way or the other;

the impact of the other provisions

whereby the necessity of complying with

the provisions in question is avoided; the

circumstances, namely, that the statute

provides for a contingency of the non-

compliance with the provisions; the fact

that the non-compliance with the

provisions is or is not visited by some

penalty; the serious or the trivial

consequences, that flow therefrom; and

above all, whether the object of the

legislation will be defeated or furthered".

If object of the enactment will be defeated

by holding the same directory, it will be

construed as mandatory, whereas if by

holding it mandatory, serious general

inconvenience will be created to innocent

persons without very much furthering the

object of enactment, the same will be

construed as directory. But all this does

not mean that the language used is to be

ignored, but only that the prima facie

inference of the intention of the

Legislature arising from the words used

may be displaced by considering the

nature of the enactment, its design and

the consequences flowing from alternative

construction. Thus, the use of the words

`as nearly as may be' in contrast to the

words `at least' will prima facie indicate a

22

directory requirement, negative words a

mandatory requirement `may' a directory

requirement and `shall' a mandatory

requirement."

Maxwell, in Chapter 13 of his 12th Edition of `The

Interpretation of Statutes', used the word `imperative' as

synonymous with `mandatory' and drew a distinction between

imperative and directory enactments, at pages 314-315, as

follows:

"Passing from the interpretation of the

language of statutes, it remains to

consider what intentions are to be

attributed to the legislature on questions

necessarily arising out of its enactments

and on which it has remained silent."

The first such question is: when a statute

requires that something shall be done, or

done in a particular manner or form,

without expressly declaring what shall be

the consequence of non-compliance, is

the requirement to be regarded as

imperative (or mandatory) or forms

prescribed by the statute have been

regarded as essential to the act or thing

regulated by it, and their omission has

been held fatal to its validity. In others,

such prescriptions have been considered

as merely directory, the neglect of them

involving nothing more than liability to a

penalty, if any were imposed, for breach

23

of the enactment. "An absolute

enactment must be obeyed or fulfilled

exactly, but it is sufficient if a directory

enactment be obeyed or fulfilled

substantially".

It is impossible to lay down any general

rule for determining whether a provision

is imperative or directory. "No universal

rule," said Lord Campbell L.C., "can be

laid down for the construction of statutes,

as to whether mandatory enactments

shall be considered directory only or

obligatory with an implied nullification for

disobedience. It is the duty of Courts of

Justice to try to get at the real intention

of the Legislature by carefully attending

to the whole scope of the statute to be

construed." And Lord Penzance said: "I

believe, as far as any rule is concerned,

you cannot safely go further than that in

each case you must look to the subject

matter; consider the importance of the

provision that has been disregarded, and

the relation of that provision to the

general object intended to be secured by

the Act; and upon a review of the case in

that aspect decide whether the matter is

what is called imperative or only

directory."

In a recent judgment of this Court, May George v. Special

Tehsildar and Ors. [(2010) 13 SCC 98], the Court stated the

precepts, which can be summed up and usefully applied by

this Court, as follows:

24 (a) While determining whether a provision is mandatory or

directory, somewhat on similar lines as afore-noticed,

the Court has to examine the context in which the

provision is used and the purpose it seeks to achieve;

(b) To find out the intent of the legislature, it may also be

necessary to examine serious general inconveniences or

injustices which may be caused to persons affected by

the application of such provision;

(c) Whether the provisions are enabling the State to do some

things and/or whether they prescribe the methodology or

formalities for doing certain things;

(d) As a factor to determine legislative intent, the court may

also consider, inter alia, the nature and design of the

statute and the consequences which would flow from

construing it, one way or the other;

(e) It is also permissible to examine the impact of other

provisions in the same statute and the consequences of

non-compliance of such provisions;

25

(f) Physiology of the provisions is not by itself a

determinative factor. The use of the words `shall' or

`may', respectively would ordinarily indicate imperative or

directory character, but not always.

(g) The test to be applied is whether non-compliance with

the provision would render the entire proceedings invalid

or not.

(h) The Court has to give due weightage to whether the

interpretation intended to be given by the Court would

further the purpose of law or if this purpose could be

defeated by terming it mandatory or otherwise.

Reference can be made to the following paragraphs of

May George (supra) :

"16. In Dattatraya Moreshwar v. The

State of Bombay and Ors. [AIR 1952 SC

181], this Court observed that law which

creates public duties is directory but if it

confers private rights it is mandatory.

Relevant passage from this judgment is

quoted below:

`7........It is well settled that

generally speaking the provisions of

26

the statute creating public duties

are directory and those conferring

private rights are imperative. When

the provisions of a statute relate to

the performance of a public duty

and the case is such that to hold

null and void acts done in neglect of

this duty would work serious

general inconvenience or injustice to

persons who have no control over

those entrusted with the duty and

at the same time would not promote

the main object of legislature, it has

been the practice of the Courts to

hold such provisions to be directory

only, the neglect of them not

affecting the validity of the acts

done.'

17. A Constitution Bench of this Court in

State of U.P. and Ors. v. Babu Ram

Upadhya [AIR 1961 SC 751] decided the

issue observing:

`29.....For ascertaining the real

intention of the Legislature, the

Court may consider, inter alia, the

nature and the design of the statute,

and the consequences which would

follow from construing it the one

way or the other, the impact of other

provisions whereby the necessity of

complying with the provisions in

question is avoided, the

circumstance, namely, that the

statute provides for a contingency of

the non-compliance with the

provisions, the fact that the non-

compliance with the provisions is or

27

is not visited by some penalty, the

serious or trivial consequences that

flow therefrom, and, above all,

whether the object of the legislation

will be defeated or furthered.'

22. In B.S. Khurana and Ors. v.

Municipal Corporation of Delhi and Ors.

[(2000) 7 SCC 679], this Court considered

the provisions of the Delhi Municipal

Corporation Act, 1957, particularly those

dealing with transfer of immovable

property owned by the Municipal

Corporation. After considering the

scheme of the Act for the purpose of

transferring the property belonging to the

Corporation, the Court held that the

Commissioner could alienate the property

only on obtaining the prior sanction of

the Corporation and this condition was

held to be mandatory for the reason that

the effect of non-observance of the

statutory prescription would vitiate the

transfer though no specific power had

been conferred upon the Corporation to

transfer the property.

23. In State of Haryana and Anr. v.

Raghubir Dayal [(1995) 1 SCC 133], this

Court has observed as under:

`5. The use of the word `shall' is

ordinarily mandatory but it is

sometimes not so interpreted if the

scope of the enactment, or

consequences to flow from such

construction would not so demand.

Normally, the word `shall' prima

facie ought to be considered

28

mandatory but it is the function of

the Court to ascertain the real

intention of the legislature by a

careful examination of the whole

scope of the statute, the purpose it

seeks to serve and the consequences

that would flow from the

construction to be placed thereon.

The word `shall', therefore, ought to

be construed not according to the

language with which it is clothed

but in the context in which it is

used and the purpose it seeks to

serve. The meaning has to be

described to the word `shall; as

mandatory or as directory

accordingly. Equally, it is settled law

that when a statute is passed for the

purpose of enabling the doing of

something and prescribes the

formalities which are to be attended

for the purpose, those prescribed

formalities which are essential to

the validity of such thing, would be

mandatory. However, if by holding

them to be mandatory, serious

general inconvenience is caused to

innocent persons or general public,

without very much furthering the

object of the Act, the same would be

construed as directory.' "

The Legislature in Sections 11A and 17(3A) of the Act has

used the word `shall' in contradistinction to the word `may'

used in some other provisions of the Act. This also is a

29

relevant consideration to bear in mind while interpreting a

provision.

The distinction between mandatory and directory

provisions is a well accepted norm of interpretation. The

general rule of interpretation would require the word to be

given its own meaning and the word `shall' would be read as

`must' unless it was essential to read it as `may' to achieve the

ends of legislative intent and understand the language of the

provisions. It is difficult to lay down any universal rule, but

wherever the word `shall' is used in a substantive statute, it

normally would indicate mandatory intent of the legislature.

Crawford on `Statutory Construction' has specifically stated

that language of the provision is not the sole criteria; but the

Courts should consider its nature, design and the

consequences which could flow from construing it one way or

the other.

Thus, the word `shall' would normally be mandatory

while the word `may' would be directory. Consequences of non-

compliance would also be a relevant consideration. The word

30

`shall' raises a presumption that the particular provision is

imperative but this prima facie inference may be rebutted by

other considerations such as object and scope of the

enactment and the consequences flowing from such

construction. Where a statute imposes a public duty and

proceeds to lay down the manner and timeframe within which

the duty shall be performed, the injustice or inconvenience

resulting from a rigid adherence to the statutory prescriptions

may not be a relevant factor in holding such prescription to be

only directory. For example, when dealing with the provisions

relating to criminal law, legislative purpose is to be borne in

mind for its proper interpretation. It is said that the purpose of

criminal law is to permit everyone to go about their daily lives

without fear of harm to person or property and it is in the

interests of everyone that serious crime be effectively

investigated and prosecuted. There must be fairness to all

sides. (Attorney General's Reference (No. 3 of 1999) (2001) 1 All

ER 577 Reference : Justice G.P. Singh on `Principles of

Statutory Interpretation', 11th Edition 2008). In a criminal

case, the court is required to consider the triangulation of

31

interests taking into consideration the position of the accused,

the victim and his or her family and the public.

The basic purpose of interpretation of statutes is further

to aid in determining either the general object of the legislation

or the meaning of the language in any particular provision. It

is obvious that the intention which appears to be most in

accordance with convenience, reason, justice and legal

principles should, in all cases of doubtful interpretation, be

presumed to be the true one. The intention to produce an

unreasonable result is not to be imputed to a statute. On the

other hand, it is not impermissible, but rather is acceptable, to

adopt a more reasonable construction and avoid anomalous or

unreasonable construction. A sense of the possible injustice of

an interpretation ought not to induce Judges to do violence to

the well settled rules of construction, but it may properly lead

to the selection of one, rather than the other, of the two

reasonable interpretations. In earlier times, statutes imposing

criminal or other penalties were required to be construed

narrowly in favour of the person proceeded against and were

32

more rigorously applied. The Courts were to see whether there

appeared any reasonable doubt or ambiguity in construing the

relevant provisions. Right from the case of R. v. Jones, ex p.

Daunton [1963(1) WLR 270], the basic principles state that

even statutes dealing with jurisdiction and procedural law are,

if they relate to infliction of penalties, to be strictly construed;

compliance with the procedures will be stringently exacted

from those proceedings against the person liable to be

penalized and if there is any ambiguity or doubt, it will be

resolved in favour of the accused/such person. These

principles have been applied with approval by different courts

even in India. Enactments relating to procedure in courts are

usually construed as imperative. A kind of duty is imposed on

court or a public officer when no general inconvenience or

injustice is caused from different construction. A provision of a

statute may impose an absolute or qualified duty upon a

public officer which itself may be a relevant consideration

while understanding the provision itself. (See `Maxwell on The

Interpretation of Statutes', 12th Edition by P. St. J. Langan and

R. v. Bullock, [(1964)1 QB 481])

33

One school of thought has accepted that the word `shall'

raises a presumption that the particular provision is

imperative, while the other school of thought believes that

such presumption is merely prima facie, subject to rebuttal by

the other considerations mentioned above. For example, in

M/s. Sainik Motors, Jodhpur & Others v. The State of

Rajasthan [AIR 1961 SC 1480], the word `shall' has been held

to be merely directory.

G.P. Singh in the same edition of the above-mentioned

book, at page 409, stated that the use of the word `shall' with

respect to one matter and use of word `may' with respect to

another matter in the same section of a statute will normally

lead to the conclusion that the word `shall' imposes an

obligation, whereas the word `may' confers a discretionary

power. But that by itself is not decisive and the Court may,

having regard to the context and consequences, come to the

conclusion that the part of the statute using `shall' is also

directory. It is primarily the context in which the words are

34

used which will be of significance and relevance for deciding

this issue.

Statutes which encroach upon rights, whether as regards

person or property, are subject to strict construction in the

same way as penal Acts. It is a recognized rule that they

should be interpreted, if possible, so as to respect such rights

and if there is any ambiguity, the construction which is in

favour of the freedom of the individual should be adopted. (See

`Maxwell on The Interpretation of Statutes', 12th Edition by P.

St. J. Langan)

This Court in the case of Devinder Singh (supra) held that

the Land Acquisition Act is an expropriatory legislation and

followed the case of Hindustan Petroleum Corporation v. Darius

Shapur Chennai and Ors. [(2005) 7 SCC 627]. Therefore, it

should be construed strictly. The Court has also taken the

view that even in cases of directory requirements, substantial

compliance with such provision would be necessary.

35 If I analyze the above principles and the various

judgments of this Court, it is clear that it may not be possible

to lay down any straitjacket formula, which could

unanimously be applied to all cases, irrespective of

considering the facts, legislation in question, object of such

legislation, intendment of the legislature and substance of the

enactment. In my view, it will always depend upon all these

factors as stated by me above. Still, these precepts are not

exhaustive and are merely indicative. There could be cases

where the word `shall' has been used to indicate the legislative

intent that the provisions should be mandatory, but when

examined in light of the scheme of the Act, language of the

provisions, legislative intendment and the objects sought to be

achieved, such an interpretation may defeat the very purpose

of the Act and, thus, such interpretation may not be

acceptable in law and in public interest. Keeping in mind the

language of the provision, the Court has to examine whether

the provision is intended to regulate certain procedure or

whether it vests private individuals with certain rights and

levies a corresponding duty on the officers concerned. The

36

Court will still have to examine another aspect, even after

holding that a particular provision is mandatory or directory,

as the case may be, i.e., whether the effect or impact of such

non-compliance would invalidate or render the proceedings

void ab initio or it would result in imposition of smaller

penalties or in issuance of directions to further protect and

safeguard the interests of the individual against the power of

the State. The language of the statute, intention of the

legislature and other factors stated above decide the results

and impacts of non-compliance in the facts and circumstances

of a given case, before the Court can declare a provision

capable of such strict construction, to term it as absolutely

mandatory or directory.

Having analysed the principles of statutory

interpretation, I will now refer to the provisions of Section

17(3A) of the Act. Section 17 of the Act vests the appropriate

Government with special powers to be exercised in cases of

urgency. This provision falls within Part II of the Act. Part II

of the Act deals with the entire scheme of acquisition of land

37

by the State, right from the stage of issuance of a notification

under Section 4 of the Act till making of an award taking

possession of acquired land and its consequential vesting in

the State. However, to some extent, the provisions of Section

17 of the Act are an exception to the provisions under Sections

4 to 16 of the Act. The distinguishing features of normal

acquisition are that after the issuance of notification under

Section 4 of the Act, the State must provide an opportunity to

the owners of the land to object to the acquisition in terms of

Section 5A of the Act, issue a declaration under Section 6 of

the Act, issue notice under Section 9 of the Act and determine

compensation by making an award under Section 11 of the

Act. However, under the scheme of Section 17 of the Act, the

Government can take possession of the property on the

expiration of 15 days from publication of notice mentioned in

Section 9(1) of the Act. Furthermore, the provisions of Section

5 of the Act, i.e., the right of the owner to file objection can be

declared to be inapplicable. Besides these two significant

distinctions, another important aspect that the land vests in

the Government under Section 16 of the Act only after the

38

award is made and possession of the land is taken, while

under Section 17(1), at the threshold of the acquisition itself,

the land could vest absolutely in the Government free from all

encumbrances. The possession of the acquired property has

to be taken by the Collector in terms of Sections 17(2) and

17(3) of the Act. Section 17(3A) of the Act, as already noticed,

was introduced by the Amendment Act 68 of 1984 for the

purposes of safeguarding the interests of the claimants and

required the payment of 80 per cent of the estimated

compensation before taking possession. At this stage itself, it

will be useful to refer to the relevant provisions of Section 17

of the Act.

Section 17 reads as under:

"17. Special powers in case of urgency. -

(1) In cases of urgency whenever the

appropriate Government, so directs, the

Collector, though no such award has

been made, may, on the expiration of

fifteen days from the publication of the

notice mentioned in section 9, sub-

section (1) take possession of any land

needed for a public purpose. Such land

shall thereupon vest absolutely in the

Government, free from all encumbrances.

39

(2) xxxxxx

(3) xxxxxx

(3A) 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 person 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.

(3B) The amount paid or deposited under

section (3A), 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 Collector's award, be recovered as

an arrear of land revenue.

(4) In the case of any land to which, in

the opinion of the appropriate

Government, the provisions of sub-

section (1) or sub-section (2) are

applicable, the appropriate Government

40

may direct that the provisions of section

5A shall not apply, and, if it does so

direct, a declaration may be made under

section 6 in respect of the land at any

time after the date of the publication of

the notification under section 4, sub-

section (1)."

Section 17(3A) of the Act makes it obligatory on the part

of the authority concerned to tender/pay 80 per cent of the

compensation for the acquired land, as estimated by the

Collector, to the persons interested and entitled thereto;

unless prevented by any of the contingencies mentioned under

Section 31(2) of the Act. The use of the word `shall' in Section

17(3A) indicates that the enactors of law desired that the

above mentioned procedure should be complied with by the

authority concerned prior to taking of possession. That is

why the legislature has even taken care to make a provision

for deposit of due compensation in court in terms of Section

31(2) of the Act, where an authority is prevented from

tendering the amount to the claimants for reasons stated in

Section 31(1) of the Act. 80 per cent of the estimated

compensation is to be deposited in the Court to which

41

reference under Section 18 of the Act would lie. This clearly

shows that there is statutory obligation upon the authorities

concerned to tender to the interested persons, compensation

in accordance with law. Deposit of money, certainly, is the

condition precedent to taking of possession as is amply clear

from the language `before taking possession of any land'. The

amount so deposited or paid in terms of Section 17(3A) of the

Act will be taken into account for determining the amount of

compensation required to be tendered under Section 31 of the

Act and provides for the recovery of amounts if it exceeds the

awarded amount. Section 17(3A) unambiguously provides a

complete mechanism of taking possession and the

requirement of payment of 80 per cent of estimated

compensation to the claimants.

Now, I would examine WHAT ARE THE

CONSEQUENCES of default in compliance to the provisions of

Section 17(3A) of the Act. The said Section is completely silent

on such consequences. Where the Legislature has, in specific

terms, provided for the extent of payment, mode of payment

42

and even the difficulties which are likely to arise, i.e, where a

person may not be entitled to receive the compensation or in

any other eventuality such as where the compensation cannot

be paid for the reasons stated in Section 31(1) of the Act, there

the Legislature in its wisdom has provided no contingencies

and/or consequences of non-deposit of this money. This is in

complete contradistinction to the provisions contained in

Sections 6 and 11A of the Act. Section 6 provides that no

declaration shall be issued where the period specified in the

first proviso to Section 6(1) of the Act has expired. In other

words, it spells out the consequences of failure to do an act

within the stipulated period. Similarly, Section 11A of the Act

provides that the acquisition proceedings shall lapse where the

Collector fails to make an award within a period of two years

from the date of publication of declaration under Section 6 of

the Act.

Thus, the legislative intent is very clear. Keeping the

objects and reasons for amendment in mind, the Act strives

for a fair balance between the rights of private individuals and

43

the power of eminent domain of the State and also attempts to

ensure expeditious disbursement of compensation, as

determined in accordance with law, to the claimants. The

legislature has provided for every contingency for tendering

payment, while remaining silent about consequences flowing

from default under some other provisions. Sections 11A and

17(3A) of the Act are clear illustrations of clarity and purpose

in legislative intent. When the framers of law have not

provided for any penal consequences for default in compliance

to Section 17(3A), then it will be uncalled for to provide such

consequences by judicial interpretation. While interpreting the

provisions for compensation, the Court can provide such

interpretation as would help to bridge the gaps left by the

Legislature, if any, in implementation of the provisions of the

Act. But it will hardly be permissible for the Court to

introduce such consequences by way of judicial dicta, like

requiring lapse of acquisition proceedings. This is not a

matter covered by the principles of judicial interpretation.

44 It is a well settled canon of statutory interpretation that

the courts would neither add nor subtract from the plain

language of the statutory provision. In the present case also,

there is hardly any justification for the courts to take any

contrary view. Once the land has vested in the State and

there being no provision for re-vesting the land in the original

owners under the provisions of the Act, then it will be in

consonance with the scheme of the Act and legislative intent to

give an interpretation that would allow provisions of Section

17(1) to operate without undue impediment and keep the

vesting of land in the State intact. Otherwise, in some cases

the purpose for which such lands were acquired might stand

frustrated, while in other cases the purpose of acquisition

might have already been achieved and, therefore, divesting

State of its title and possession in the acquired land will be

incapable of performance. Under such circumstances, then,

to interpret Section 17(3A) of the Act to be so mandatory in its

absolute terms that the non-payment of money would result in

vitiating or lapsing entire acquisition proceedings, can hardly

be justified on the strength of any known principle of

45

interpretation of statutes. This question arises more often, as

the provisions of Section 17 of the Act are being invoked by the

Union of India and State Governments very frequently, so, the

consequences of this default, within the framework of law and

anything short of invalidation of the acquisition proceedings

should be stated by the court with reference to the facts and

circumstances of each case. It is a complete safeguard

provided to the land owner inasmuch as the compensation

stipulated under Section 17(3A) of the Act should be paid in

terms of the provisions of the Act so that the owner is not

made to suffer on both counts i.e. he is deprived of his land as

well as compensation. It will be unfair for the authorities

concerned not to pay the compensation as contemplated

under the provisions of the Act. It would be just and fair to

read into the provisions of the Section 17(3A) as imposing an

obligation on the part of the authorities concerned/the

Collector to pay the compensation within the time specified

under Section 17(3A). Of course, no specific time, within

which the payment has to be made in terms of Section 17(1)

has been stated in the provision. But, it is a settled principle

46

of law that wherever specific limitations are not stated, the

concept of `reasonable time' would become applicable. So,

even if it is argued that there is no specific time contemplated

for payment/deposit of 80 per cent of the estimated

compensation, even then the claimants would be entitled to

receive the amount expeditiously and in any case within very

reasonable time. If the authorities are permitted to take

possession of the land without payment of the amounts

contemplated under Section 17(3A) of the Act, then it would

certainly amount to abuse of power of eminent domain within

its known legal limitations. The authorities should discern the

distinction spelt out under Section 16 of the Act on the one

hand and Section 17(1) read with Section 17(3A) of the Act on

the other.

Let me examine the judgment of this Court dealing with

the provisions of Section 17(3A) of the Act. The judgments of

different High Courts have been brought to the notice of this

Court, taking divergent views on the question whether the

provisions of Section 17(3A) are mandatory or directory. Some

47

of these judgments, I would shortly refer to, if necessary.

However, I may notice that none of these judgments have

specifically discussed the consequences of non-adherence to

the provisions of Section 17(3A) of the Act. A Bench of Delhi

High Court in the case of Banwari Lal & Sons Pvt. Ltd. vs.

Union of India & Ors., [1991 (1) DRJ (Suppl.) 317 (Delhi

Reported Journal)], whilst quashing the notification issued

under Section 4 read with Section 17(1) of the Act on the

ground of factual lack of urgency for acquisition, held that

there was non-compliance to the provisions of Section 17(3A)

of the Act. Of course, the High Court took the view that the

notification issued under Section 4 read with Section 17(1) of

the Act was not maintainable and while quashing the said

notification, it also held that there was violation of provisions

of Section 5A of the Act and, in fact, no urgency existed. There

was no direct discussion as to whether the provisions of

Section 17(3A) of the Act are mandatory or directory. However,

this judgment neither provides any reasoning nor actually

states the consequences of non-compliance with the provisions

of Section 17(3A). For these reasons, this judgment is of no

48

help to the parties appearing in the present appeal. Against

the judgment of Delhi High Court in Banwari Lal (supra), the

Special Leave Petition preferred before this Court was

dismissed at the admission stage itself.

In the case of Union of India & Ors. v. Krishan Lal Arneja

& Ors., [(2004) 8 SCC 453], a part of the acquisition was

challenged and writ petitions had been filed for quashing the

notification dated 6th March, 1987 issued under Section 4 and

Section 17(1) of the Act by Banwari Lal and other owners of

the acquired lands. These writ petitions were allowed by a

learned Single Judge of the High Court, appeal against which

was dismissed by the Division Bench of the High Court. While

considering the appeal against the order of the Division Bench,

this Court also dismissed the same. In the appeal, arguments

had also been advanced that since the Government before this

Court had not made the payment of 80 per cent of estimated

compensation in terms of Section 17(3A) of the Act, the

acquisition had lapsed. However, in paragraph 36 of that

judgment, this Court declined to deal with these contentions

49

as it had dismissed the appeal on other grounds. The Court

incidentally observed that it was not a fair stand to be taken

by the State before the Court to argue that it could de-notify

the acquired land on the plea that it had failed to comply with

the statutory provisions of the Act. In short, the question in

controversy in the present case was not actually pronounced

upon by the Court in that case.

The question of the provisions of Section 17(3A) of the Act

being mandatory or directory again fell for consideration before

this Court in the case of Tika Ram & Ors. v. State of U.P. &

Ors. [(2009) 10 SCC 689]. In this case, challenge to the

constitutional validity of the provisions of Section 17 was also

made. The Court, while holding that the said provisions are

constitutional, also declared that the provisions of Section

17(3A) were not mandatory and their non-compliance would

not vitiate the whole acquisition proceedings. The following

paragraphs of the judgment are relevant:

"91. However, the question is as to what

happens when such payment is not made

50

and the possession is taken. Can the

whole acquisition be set at naught?

92. In our opinion, this contention on

the part of the appellants is also

incorrect. If we find fault with the whole

acquisition process on account of the

non-payment of 80% of the

compensation, then the further question

would be as to whether the estimation of

80% of compensation is correct or not. A

further controversy can then be raised by

the landlords that what was paid was not

80% and was short of 80% and therefore,

the acquisition should be set at naught.

Such extreme interpretation cannot be

afforded because indeed under Section 17

itself, the basic idea of avoiding the

enquiry under Section 5-A is in view of

the urgent need on the part of the State

Government for the land to be acquired

for any eventuality discovered by either

sub-section (1) or sub-section (2) of

Section 17 of the Act.

93.

The only question that would remain is

that of the estimation of the

compensation. In our considered view,

even if the compensation is not paid or is

short of 80%, the acquisition would not

suffer. One could imagine the

unreasonableness of the situation. Now

suppose, there is state of emergency as

contemplated in Section 17(2) of the Act

and the compensation is not given, could

the whole acquisition come to a naught?

It would entail serious consequences.

51

94.

This situation was considered, firstly, in

Satendra Prasad Jain v. State of U.P. It

was held therein that once the possession

is taken as a matter of fact, then the

owner is divested of the title to the land.

The Court held that there was then no

question of application of even Section

11-A. Commenting upon Section 11-A, it

was held that that the Section could not

be so construed as to leave the

Government holding title or the land

without an obligation to determine the

compensation, make an award and pay to

the owner the difference between the

amount of the award and the amount of

the 80% of the estimated compensation.

The three-Judge Bench of the Court took

the view that even where 80% of the

estimated compensation was not paid to

the landowners, it did not mean that the

possession was taken illegally or that the

land did not vest in the Government. In

short, this Court held that the

proceedings of acquisition are not

affected by the nonpayment of

compensation. In that case, the Krishi

Utpadan Mandi Samiti, for which the

possession was made, sought to escape

from the liability to make the payment.

That was not allowed. The Court, in para

17, held as under : (Satendra Prasad Jain

case, SCC p. 375, para 17)

"17. In the instant case, even that

80% of the estimated compensation

was not paid to the appellants

although Section 17 (3-A) required

52

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. 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."

95. Further, in a judgment of this Court

in Pratap v. State of Rajasthan, a similar

view was reported. That was a case under

the Rajasthan Urban Improvement Act,

1987, under which the acquisition was

made using Section 17 of the Act. The

Court took the view that once the

possession was taken under Section 17 of

the Act, the Government could not

withdraw from that position under

Section 18 and even the provisions of

Section 11-A were not attracted. That was

of course a case where the award was not

passed under Section 11-A after taking of

the possession. A clear-cut observation

came to be made in that behalf in para

12, to the effect that the non-compliance

with Section 17 of the Act, insofar as

53

payment of compensation is concerned,

did not result in lapsing of the land

acquisition proceedings. The law laid

down by this Court in Satendra Prasad

Jain v. State of U.P. was approved. The

Court also relied on the decision in P.

Chinnanna v. state of A.P. and Awadh

Bihari Yadav v. State of Bihar, where

similar view was taken regarding the land

acquisition proceedings not getting

lapsed. The only result that may follow by

the non-payment would be the payment

of interest, as contemplated in Section 34

and the proviso added thereto by the

1984 Act. In that view, we do not wish to

further refer the matter, as suggested by

Shri Trivedi, learned Senior Counsel and

Shri Qamar Ahmad, learned counsel for

the appellants. Therefore, even on the

sixth question, there is no necessity of

any reference."

As is obvious from the above paragraphs, there is an

indefeasible obligation on the part of the Government to make

the payment in terms of Section 17(3A) of the Act but non-

compliance thereto could not result in vitiation of the

acquisition proceedings. The observations made by this Court

in the case of Satendra Prasad Jain (supra), in paragraph 17,

suggest that the Government was required to hold title to the

acquired land coupled with its obligation to determine the

54

compensation, make the award and then to pay to the owner

the difference between the amount of 80 per cent of the

estimated compensation and the amount finally determined.

The Court even went to the extent of observing that non-

payment of 80 per cent of the estimated compensation per se

does not mean that possession was taken illegally or that the

said land did not thereupon vest in the Government. This

decision does provide any reasoning and conclusions which

support the view that Section 17(3A) of the Act is not a

mandatory provision. Following this judgment, another Bench

of this Court in the case of Pratap & Anr. v. State of Rajasthan

[(1996) 3 SCC 1] took the same view.

However, another Bench of this Court, in the case of

Rajender Kishan Gupta v. Union of India [(2010) 9 SCC 46],

had made certain observations which were at some variance to

the dicta of this Court in the cases referred above. In that

case, neither the validity nor the effects of non-compliance

with Section 17(3A) of the Act were directly in issue. The

challenge was to a notification issued under Section 4(1) of the

55

Act for the land which was subsequently needed for the Metro

Project in Delhi. The challenge was primarily based on the

ground that the land could only be acquired under the Metro

Rail Construction Works Act, 1978 and the emergency clause

could not be used as a way to dispense with enquiry under

Section 5A of the Act. The Court, while dismissing the appeal

preferred by the claimants and rejecting the contentions in

paragraph 29, made the following observations :

"In the light of the above discussion, we

are satisfied that the existence of public

purpose and urgency in executing the

project before the Commonwealth Games,

the adjoining land belonging to DDA

being forest land as per the notification

and also of the fact that the respondents

have fully complied with the mandatory

requirements including deposit of 80% of

the compensation amount, we are in

entire agreement with the stand taken by

the respondents as well as the conclusion

of the High Court."

The Bench, dealing with the matter, did use the

expression `mandatory requirements, including deposit of 80

per cent of the compensation amount', but there was no

discussion or reasoning of the effects and consequences of

56

such default, anywhere in the judgment, before it has been

concluded that the said provisions are mandatory. Thus,

these observations do not come to the aid of the appellants in

challenging the entire acquisition proceedings on this ground.

Consistent with the view expressed by this Court in the

cases referred (supra), I am of the considered view that the

provisions of Section 17(3A) of the Act are not mandatory.

Such a conclusion can safely be arrived at, even for the reason

that the Court would have to read into the provisions of

Section 17(3A) consequences and a strict period of limitation

within which amount should be deposited, which has not been

provided by the Legislature itself in that section. The

consequences and contingencies arising from non-compliance

of the said provisions have not been stated in the Act. Once

the land has vested in the Government, non-compliance with

the obligation of payment of 80 per cent of estimated

compensation would not render the possession taken under

Section 17(1) as illegal. The land cannot be re-vested or

reverted back to the claimants as no provisions under the Act

57

so prescribe. Furthermore, if the interpretation put forward by

the appellants is accepted, it would completely frustrate the

objects and purpose of the Act, rather than advancing the

same. The expression `shall' used in Section 17(3A) has to be

understood in its correct perspective and is not to be

construed as suggestive of the provisions being absolutely

mandatory in its application. Inter alia for these reasons and

as per the above discussions, I hold that the provisions of

Section 17(3A) are not mandatory. They are directive

provisions, though their compliance is necessary in terms of

the Act.

Having held as above, I hasten to add that the obligation

on the part of the Government or concerned authority to

deposit the amount prior to taking possession under Section

17(1) of the Act should essentially be complied with. The

amount of 80 per cent of the estimated compensation in terms

of Section 17(3A) should be deposited. Once we read the

provisions of Sections 17(1) and 17(3A) conjunctively, it

implies that the amounts are to be deposited within 15 days

58

from the publication of the notice in terms of Section 9(1) of

the Act and before taking of possession of the acquired land.

The Legislature has sufficiently indicated that the payment of

the due 80 per cent of compensation should be made at the

earliest and, particularly, before possession is taken. Non-

compliance of the provisions of Section 17(3A) would not

vitiate the acquisition proceedings, but depending on the facts

of a given case, the payment should be made within the time

indicated and in any case within a reasonable time, and the

claimant should then be entitled to additional benefits for

such non-compliance. The Court would fill a part of the gap

which has remained unfilled by the Legislature.

Irrespective of whether the provision is held to be

mandatory or directory, compliance with its substance is

equally important. In either case, the authority entrusted with

a duty is not absolved of its obligation to perform the specified

duty or obligation in the manner stated in law. It is primarily

the consequences which result from non-performance of duty,

which are of significance in determining the impact of

59

mandatory or directory nature of a provision. Normally, in

both cases, some consequences should flow from non-

performance. Even if the provisions of Section 17(3A) are

directory, as held by me above, the deposit of 80 per cent of

estimated compensation within the period of limitation i.e. 15

days and prior to taking possession of the land, has to be

made. There is no ambiguity in this requirement. Thus, it

shall be the duty of the Court to fill the lacuna (i.e., the

consequences of non-payment of compensation) to complete

the chain of the legislative scheme contained in Section 17 of

the Act. Having taken recourse to the emergency provisions

and having taken possession of the land, the Government and

its authorities cannot be permitted to defer the payment of the

requisite amount, in terms of Section 17(3A) of the Act,

indefinitely or for an unduly long period. A responsibility is

cast upon the authorities concerned to make payments within

time and not unduly cause inconvenience and harassment to

persons interested in the compulsorily acquired land and who

have been deprived of possessory benefits also. Persons who

are so deprived of their land and possessory benefits thereof,

60

are not in a position to carry out agricultural activity or derive

any other benefit as they might have been deriving prior to

compulsory acquisition/taking possession of the land. In

other words, it is a case of deprivation of property and to some

extent deprivation of sources of income. Without hesitation,

the claimants/owners of land should be and ought to be

entitled to certain additional benefits within the legislative

framework of the Act. Certain additional and interest benefits

are provided under Sections 23(1A), 23(2), 28 and 34 of the

Act. The legislature has even taken care of providing higher

rates of interest where the possession of the land has already

been taken and compensation has not been paid or deposited

within the specified time or in the manner prescribed under

Section 34 of the Act. Proviso to this Section states that where

the compensation payable, or any part thereof, has not been

paid or deposited within a period of one year from the date on

which possession is taken, interest at the rate of 15 per cent

per annum shall be payable from the date of expiry of the said

period of one year, calculated on the amount of compensation

or part thereof which has not been paid or deposited before

61

the date of such expiry, until the time such payment is finally

made. We have to read the provisions of Section 34 together

with the provisions of Sections 17(1) and 17(3A) of the Act.

They have to be construed harmoniously, keeping in mind the

object sought to be achieved by a conjoint reading of these

provisions. The expression `before taking possession of the

land' has been used in Section 17 read with Section 17(3A)

and in Section 34 as well. Once the Government has invoked

the emergency provisions, it is pre-supposed that the

Government needs the land urgently and, in its wisdom, has

decided that it is not in public interest to go through the

normal procedure prescribed for acquisition and payment of

compensation under Part II of the Act. It requires immediate

possession of the land for achievement of the purpose for

which land was required. As the Government would take

possession by depriving the land owners of some of their

rights, as would have been available to them under normal

acquisition procedure, the Legislature has created special

safeguards in their favour. Firstly, they would be given 15

days notice prior to taking of possession of the land (Section

62 9(1) of the Act). Secondly, 80 per cent of the estimated

compensation shall be paid to them in terms of Section 17(3A)

of the Act, before the possession is taken. Thus, the

Legislature has balanced the rights and obligations between

the parties. Section 34, therefore, cannot be read so as to

destroy the protections or safeguards provided to

claimants/owners of the land under Section 17 of the Act.

These provisions must be read harmoniously. These

provisions should be construed so as to give benefit to the

owners of the land against compulsory acquisition, rather

than accepting an interpretation which would defeat the

benefits intended by the Legislature. The Legislature was fully

aware of the provisions of Section 34 while introducing Section

17(3A) into the Act, as both the provisions were introduced by

the same Amending Act of 1984. This clearly demonstrates

the legislative intent that the protections specified under

Section 17(1) would operate in their own field and the

provisions of Section 34 would also apply in its own sphere. It

will be unfair, if the Government takes possession of the

property within 15 days of the notice issued under Section 9(1) 63

(as is contemplated under Section 17(1) of the Act) and does

not make payment of compensation for a long period, with no

additional liability whatsoever. It appears to me that this is not

the legislative intent that the Government would not be liable

to pay higher rate of interest where it has taken possession of

the land in exercise of its powers under Section 17 of the Act.

It will be unfair if the liability to pay higher rate of interest in

terms of Section 34 would arise only after a period of one year

from the date of possession even in cases of emergent

acquisition. Such an interpretation may result in frustrating

the balance sought to be created by the Legislature. For these

reasons, I am of the considered view that the statutory benefit

contained in Section 34 of the Act should be made applicable

to the provisions of Section 17(1) read with Section 17(3A) in

the manner that it would give the requisite benefit to the

owners/claimants of the land rather than deprive them of

both, their land and income, without any additional benefit

despite non-compliance of the provisions of the Act. Thus, the

owners/claimants should be entitled to receive, on the

strength of these provisions and alike, the interest payable

64

under the proviso to Section 34 i.e. interest at the rate of 15

per cent per annum from the date of expiry of the period of 15

days as stated under Section 17(1) and from taking of

possession of the land from the owners/persons interested in

the land till payment of compensation in terms of Section

17(3A) of the Act.

These conditions have to be satisfied cumulatively and

not alternatively, to give rise to the liability to pay interest of

15 per cent from the date afore-stated. This approach that I

am adopting is restricted in application to the acquisitions

made by the Government in exercise of its emergency powers

under Section 17 of the Act. Section 34 would otherwise

operate in its own sphere and only after the lapse of the period

specified in the proviso. The conclusion of the above

discussion is that non-compliance of provisions of Section

17(1) read with Section 17(3A) would not render the

acquisition proceedings invalid or void ab initio in law however,

liability to pay interest at the rate of 15 per cent per annum

would arise from the date and for the period afore-noticed.

65 Do the provisions of Section 11A apply to the acquisition

proceedings commenced by the Government in exercise of

its powers of urgency under Section 17 of the Act?

I have already noticed that Section 11A of the Act was

introduced into the statute book by the Legislature vide Land

Acquisition (Amendment) Act (68 of 1984). This provision was

introduced primarily to provide safeguards and to secure the

interests of owners/persons interested, whenever their land

was acquired under the provisions of the Act. Section 11A of

the Act reads as under :

"11A. 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, 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

66

the said declaration is stayed by an order

of a Court shall be excluded."

A bare reading of the above provision shows that the

Legislature places an obligation upon the Collector to make an

award at the earliest. Wherever the award under Section 11 of

the Act has not been made within two years from the date of

publication of the declaration, the entire proceedings for

acquisition of land shall lapse. Explanation to Section 11A of

the Act further excludes from this period, any period during

which any action or proceeding, to be taken in pursuance of

the said declaration, is stayed by an order of a Court which

had been in force. Exclusion of no other period is

contemplated under this provision. Thus, a definite intention

of the framers of law is clear that the award should be made at

the earliest and, in any case, within a maximum period of two

years from the declaration under Section 6 of the Act, if the

acquisition proceedings are to survive. The acquisition under

the Act being compulsory acquisition, a safeguard or right has

been provided to the private party against the State. Thus, the

statute imposes a duty upon the State to act within time and

67

also provides for consequences that shall ensue in the event of

default. These consequences are of a very serious nature,

whereby the entire acquisition proceedings shall stand lapsed.

This would render the land free from acquisition or any

restriction and title over the land would stand reverted to the

owners/persons interested.

I have already discussed in some detail the principles

which will help the Court in determining whether a provision

is directory or mandatory. It is clear from the substance of the

language and from the intention of the legislature that the

right created in favour of the citizen and the duties imposed on

the State should be construed strictly. Section 11A of the Act

provides for discharge of obligations within the specified time

and there are serious consequences of such non-fulfillment.

This would clearly lead to the conclusion that the provisions of

Section 11A of the Act are capable of strict construction and

are mandatory in their application. In number of cases,

including the case of Mohan & Anr. v. State of Maharahtra

[(2007) 9 SCC 431], this Court has already held that Section

68 11A of the Act is mandatory. This view, with respect, and for

the reasons recorded above, I follow.

A three-Judge Bench of this Court in the case of

Satendra Prasad Jain (supra) went further to specifically

consider the question as to whether the provisions of Section

11A of the Act were attracted and, if so, whether they should

be strictly construed and where the possession of the acquired

land is taken and it is vested in the Government under Section

17 of the Act, whether the acquisition proceedings could lapse

in terms of Section 11A of the Act. Answering the question in

the negative, the Court stated that the Government could not

withdraw from the acquisition under Section 48 of the Act and

claim the benefit of its own default in not making an award

within the period of two years. The Court laid down the

following dictum:

"15. Ordinarily, the Government can take possession of the land proposed to be

acquired only after an award of

compensation in respect thereof has been

made under Section 11. Upon the taking

of possession the land vests in the

Government, that is to say, the owner of

the land loses to the Government the title

69

to it. This is what Section 16 states. The

provisions of Section 11-A are intended to

benefit the landowner and ensure that

the award is made within a period of two

years from the date of the Section 6

declaration. 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.

16. Further, Section 17(3-A) postulates that the owner will be offered an amount

equivalent to 80 per cent of the estimated

compensation for the land before the

Government takes possession of it under

Section 17(1). Section 11-A cannot be so

construed as to leave the Government

holding title to the land without the

obligation to determine compensation,

make an award and pay to the owner the

difference between the amount of the

award and the amount of 80 per cent of

the estimated compensation."

70

This judgment was followed by another Bench of this

Court in the case of Awadh Bihari Yadav & Ors. v. State of

Bihar & Ors. [(1995) 6 SCC 31], which held, "...we, therefore,

hold that the land acquisition proceedings in the instant case

did not lapse...".

The principle of law stated in Satendra Prasad Jain

(supra) was again followed by this Court in the case of P.

Chinnanna & Ors. v. State of A.P. & Ors. [(1994) 5 SCC 486]

and Pratap (supra) and in the case of Allahabad Development

Authority v. Nasiruzzaman & Ors. [(1996) 6 SCC 424], this

Court held as under :

"In the impugned judgment, it would appear that the learned Judges asked the counsel to verify whether the award came to be made within two years, as indicated. The counsel on verification had stated that the award was not made within two years from the commencement of the Amendment Act, namely, 24-9- 1984. Consequently, the declaration was given that the notification under Section 4(1) and the declaration under Section 6 stood lapsed. This question was examined by this Court in Satendra Prasad Jain v. State of U.P. and Awadh Bihari Yadav v. State of Bihar and held that Section 11-A does not apply to cases of acquisitions under Section 17 where possession was already taken and the land stood vested in the State. The

71

notification under Section 4(1) and declaration under Section 6 do not lapse due to failure to make an award within two years from the date of the declaration. The view of the High Court is erroneous in law."

In a very recent judgment of a Division Bench of this

Court, (to which, one of us, Asok Kumar Ganguly, J. was a

member) in the case of Banda Development Authority, Banda v.

Moti Lal Agarwal & Ors. [2011 (5) SCALE 173], this Court

followed the aforesaid view with further clarification. Usefully,

paragraphs 33, 36 and 38 of the said judgment can be referred

to at this stage, which read as under :

"33. XXX XXX XXX

... v) If beneficiary of the acquisition is an

agency/instrumentality of the State and

80% of the total compensation is

deposited in terms of Section 17(3A) and

substantial portion of the acquired land

has been utilized in furtherance of the

particular public purpose, then the Court

may reasonably presume that possession

of the acquired land has been taken.

XXX XXX XXX

36. Once it is held that possession of the

acquired land was handed over to the

BDA on 30.6.2001, the view taken by the

High Court that the acquisition

72

proceedings had lapsed due to non-

compliance of Section 11A cannot be

sustained......

XXX XXX XXX

38. In the result, the appeal is allowed.

The impugned order is set aside and the

writ petition filed by Respondent No. 1 is

dismissed with cost quantified at Rs.

1,00,000/-. Respondent No. 1 shall

deposit the amount of cost with the

Appellant within a period of two months

from today."

However, the learned counsel appearing for the appellant

has placed reliance upon a judgment of this Court in the case

of Yusufbhai Noormohmed Nendoliya v. State of Gujarat [(1991)

4 SCC 531] to contend that the provisions of Section 11A of

the Act are applicable to the acquisition under Section 17 as

well. For non-adherence to those provisions, the entire

acquisition proceeding should be declared to have lapsed and

the applicants should be entitled to their lands free from any

encumbrance. Let me analyze this judgment to appreciate the

contention raised by the counsel appearing for the appellants.

In this case, the appellants were occupants of the lands

73

sought to be acquired by the State of Gujarat for the purposes

of establishing North Gujarat University and notification under

Section 6 of the Act in respect of the said land was issued on

12th May, 1988. An interim order restraining the State from

taking possession was granted by the Court. However, the

Acquisition Officer proceeded to issue a notice under Section

9(1) of the Act and determined the compensation payable. As

the award had not been made, the appellants therein had

made a representation to the Government that the award had

not been made within the period of two years mentioned under

Section 11A of the Act and, therefore, the acquisition

proceedings had lapsed. This plea was rejected. The

appellants filed an application challenging the said decision,

praying for a declaration that the acquisition proceedings had

lapsed. The Division Bench of the Gujarat High Court took the

view that the explanation to Section 11A is not confined to

stay of making of the award pursuant to notification under

Section 6, but it is widely worded and covers in its sweep the

entire period during which any matter or proceedings due to

be taken are stayed by a competent Court. This decision was

74

challenged before this Court. In other words, this Court, in

Yusufbhai (supra), was primarily concerned with the

interpretation of Explanation to Section 11A of the Act and

was determining the period which needs to be excluded while

computing the limitation period of two years provided for the

making of an award. While rejecting the view taken to the

contrary by a Single Judge of the Kerala High Court, this

Court made a reference to taking of possession under Section

17 of the Act and held :

"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... The benefit is

that the award must be made within a

period of two years of the declaration,

failing which the acquisition proceedings

would lapse and the land would revert to

the landholder...".

It is obvious from a bare reading of the above observation

that the question of applicability of Section 11A to acquisition

75

proceedings under Section 17 was not in issue before the

Court. This controversy was neither argued nor was it even

remotely necessary for the adjudication of the dispute between

the parties. These observations are merely an obiter of the

Court, which is made to support its conclusion in paragraph 8

of the judgment and cannot be treated as ratio decidendi of the

judgment or a precedent for the proposition raised in the

present case. The learned counsel attempted to argue that the

expression `whether the case is covered by Section 11 or

otherwise' unequivocally states the principle of law that

Section 11A is applicable to the present case. I am unable to

accept this contention as it is not an authority for the

proposition. This controversy was never raised before the

Bench. The argument raised on behalf of the appellants is,

therefore, misplaced.

A half hearted attempt was also made by the learned

counsel for the appellants to advance the argument that there

is difference of opinion by equi Benches of this Court, in the

case of Satendra Prasad Jain (supra) on the one hand and

76 Yusufbhai Noormohmed Nendolia (supra) on the other and,

therefore, this matter should be referred to a larger Bench. I

am not impressed with this contention at all. There is no

conflict. Satendra Prasad Jain (supra) lays down the law and

on true application of the principle of ratio decidendi, it is a

direct precedent for the proposition involved in the present

case. I can squarely answer the questions of law arising in the

present case with reference to the settled principles and,

therefore, have no hesitation in rejecting this request made on

behalf of the appellants.

Let me also examine the other reasons which will support

the view taken by this Court in Satendra Prasad Jain (supra)

and followed in subsequent cases referred above. Section

17(1) of the Act uses the expression `though no such award

has been made'. This clearly demonstrates that making of an

award is not a sine qua non for issuance of a notification

under Section 4(1) read with Section 17(1) of the Act or even

taking possession in terms thereof. After publication of a

notification under Section 4 read with Sections 17(1) and 17(4) 77

of the Act, the authority is obliged only to publish a notice

under Section 9(1) of the Act and comply with the provisions of

Section 17(3A) before it can take possession within the

stipulated period. Once possession of the land is taken, it

shall thereupon vest absolutely in the Government free from

all encumbrances. In other words, Section 17(4) itself is a

permissible exception to the provisions of Section 11 of the Act

and, therefore, the question of enforcing Section 11A against

proceedings under Section 17 would not arise. Under Section

16, the land shall vest in the Government free from all

encumbrances only after the award is made and possession is

taken. In contradistinction to this, under Section 17(1) the

land shall vest absolutely in the Government free from all

encumbrances even when no award is made and possession

thereof is taken in terms of Sections 17(1) and 17(3A) of the

Act. We have to give the language of Section 17(1) its plain

meaning, within the field of its operation. Another reason in

support of taking such a view is that, once such possession is

taken and the land is so vested, the Act does not make any

provision for re-vesting of land in the owners/persons

78

interested. Reversion of title or possession of property

acquired, which has vested in the Government or in the

authority for whose benefit such lands are acquired, is

unknown to the scheme of the Act. To introduce such a

concept by interpretative process would neither be permissible

nor proper.

Discussion on reverting back of land to the owners in

terms of Section 48 of the Act

A Constitution Bench of this Court (to which I was a

member) in the recent judgment in the case of Offshore

Holdings Pvt. Ltd. v. Bangalore Development Authority & Ors.

[(2011) 3 SCC 139], while dealing with the provisions of

Sections 27 and 36 of the Bangalore Development Authority

Act read with the provisions of the Land Acquisition Act and

while referring to non-reversion of property to owners where it

is vested in the Government, held as under :

"Where, upon completion of the

acquisition proceedings, the land has

vested in the State Government in terms

of Section 16 of the Land Acquisition Act,

the acquisition would not lapse or

79

terminate as a result of lapsing of the

scheme under Section 27 of the BDA Act.

An argument to the contrary cannot be

accepted for the reason that on vesting,

the land stands transferred and vested in

the State/Authority free from all

encumbrances and such status of the

property is incapable of being altered by

fiction of law either by the State Act or by

the Central Act. Both these Acts do not

contain any provision in terms of which

property, once and absolutely, vested in

the State can be reverted to the owner on

any condition. There is no reversal of the

title and possession of the State.

However, this may not be true in cases

where acquisition proceedings are still

pending and land has not been vested in

the Government in terms of Section 16 of

the Land Acquisition Act."

As already discussed, no award is required to be made

before the provisions of Section 17(1) can be invoked. Such an

approach is further buttressed by another factor that is

reflected under Section 17(3B) of the Act. The amount of 80

per cent of the estimated compensation deposited under

Section 17(3A) of the Act is to be finally adjusted against the

award made under Section 11 in terms of Section 17(3B) of the

Act. A cumulative reading of these provisions clearly suggests

80

that provisions of Section 11A of the Act can hardly be applied

to the acquisition under Section 17 of the Act.

Another point which would support the view that I am

taking is with reference to the provisions of Section 48 of the

Act. Section 48 empowers the Government to withdraw from

the acquisition of the land of which possession has not been

taken. Where the Government withdraws from such an

acquisition, it is its duty to determine the amount of

compensation for the damages suffered by the owners as a

consequence of the notice or any other proceeding taken

thereunder, which amounts have to be paid as per provisions

of Part III. Section 48, thus, is a clear indication that the

power of the Government to withdraw the acquisition is

subject to the limitation stated under Section 48 itself. The

scheme of Section 48 can be summarized as follows:

A. Except in cases provided under Section 36, the Government

has the power to withdraw from the acquisition of any land;

B. Provided the possession of such land had not been taken;

81

C. Government is liable to pay compensation for the damages

suffered by the owner as a consequence of notice or any

proceeding thereunder which have to be computed in

accordance with the provisions of Part III.

There is no ambiguity in the language of Section 48 of the

Act to give it any other interpretation except that the

Government is not vested with the power of withdrawing from

the acquisition of any land, of which the possession has been

taken. Where the award has been made and possession has

been taken, the land vests in the Government in terms of

Section 16 of the Act. On the contrary, the land vests

absolutely in the Government free from all encumbrances

where award has not been made and only possession as

contemplated under Section 17(1) of the Act has been taken.

If the Government has no power to withdraw from acquisition

of any land, the possession of which has been taken, then by

no stretch of imagination can it be held that the Government

will have the power to withdraw from the acquisition of any

land where the land has vested in the Government or the land

82

has been subsequently transferred in favour of an authority

for whose development activity the lands were acquired. In

the case of Lt. Governor of Himachal Pradesh and Anr. v.

Avinash Sharma [(1970) 2 SCC 149 ], this Court took the view

that once the notification under Section 17(1) of the Act is

issued and land accordingly vested with the Government, the

notification can neither be cancelled under Section 21 of the

General Clauses Act nor can it be withdrawn in exercise of

powers conferred by the Government under Section 48 of the

Act. This Court in Avinash Sharma's case (supra) held as

under :

"But these observations do not assist the

case of the appellants. It is clearly

implicit in the observations that after

possession has been taken pursuant to a

notification under Section 17(1) the land

is vested in the Government, and the

notification cannot be cancelled under

Section 21 of the General Clauses Act,

nor can the notification be withdrawn in

exercise of the powers under Section 48

of the Land Acquisition Act. Any other

view would enable the State Government

to circumvent the specific provision by

relying upon a general power. When

possession of the land is taken under

Section 17(1), the land vests in the

83

Government. There is no provision by

which land statutorily vested in the

Government reverts to the original owner

by mere cancellation of the notification."

In another case titled Rajasthan Housing Board and

Others v. Shri Kishan and Others [(1993) 2 SCC 84], this Court

was concerned with a notification issued under Section 4 of

the Act and also a notification issued a few days after the

issuance of the first notification, under Section 17(4) of the

Act. These were challenged on the ground that there was no

urgency and so, the provisions of Section 5A of the Act could

not be dispensed with and that there were structures on the

land which could not have been acquired. An argument was

also raised that the Government had intended and, in fact,

issued letters de-notifying the lands acquired and, thus, they

should be treated as having been de-notified as per the

decision of the Government. In these circumstances, the

Court held as under:

"26. We are of the further opinion that in

any event the government could not have

withdrawn from the acquisition under

Section 48 of the Act inasmuch as the

Government had taken possession of the

84

land. Once the possession of the land is

taken it is not open to the government to

withdrawn from the acquisition. The very

letter dated 24.2.1990 relied upon by the

counsel for the petitioner recites that

"before restoring the possession to the

society the amount of development

charges will have to be returned back...."

This shows clearly that possession was

taken over by the Housing Board. Indeed

the very tenor of the letter is, asking the

Housing Board as to what development

work they had carried out on the land

and how much expenditure they had

incurred thereon, which could not have

been done unless the Board was in

possession of the land. The Housing

Board was asked to send the full

particulars of the expenditure and not to

carry on any further development works

on that land. Reading the letter as a

whole, it' cannot but be said that the

possession of the land was taken by the

government and was also delivered to the

Housing Board. Since the possession of

the land was taken, there could be no

question of withdrawing from the

acquisition under Section 48 of the Land

Acquisition Act, 1894."

In the case of Sanjeevanagar Medical & Health

Employees' Cooperative Housing Society v. Mohd. Abdul Wahab

and Others [(1996) 3 SCC 600], it was held that the acquired

land had already been transferred to the society for the benefit

85

of which the lands were acquired, by invoking the urgency

clauses. The question of reverting acquired land had not

arisen in this case directly, as the Court was primarily

concerned with the contention that the notification issued

under Section 4 was liable to be quashed. A question, with

regard to inconsistency between the Central and the State

Acts, was also raised. The Court, in paragraph 12 of the

judgment, held that by operation of Section 16, land had been

vested in the State free from all encumbrances and while

referring to the judgment of this Court in Satendra Prasad

Jain (supra) reiterated the principle that `Divesting the title to

the land statutorily vested in the Government and reverting

the same to the owner is not contemplated under the Act. Only

Section 48 gives power to withdraw from acquisition that too

before possession is taken.' This principle was followed by another Bench of this

Court in the case of Bangalore Development Authority and

Others v. R. Hanumaiah and Others [(2005) 12 SCC 508]

wherein, it was held as follows:

86 "46. The possession of the land in

question was taken in the year 1966 after

the passing of the award by the Land

Acquisition Officer. Thereafter, the land

vested in the Government which was then

transferred to CITB, predecessor-in-

interest of the appellant. After the vesting

of the land and taking possession thereof,

the notification for acquiring the land

could not be withdrawn or cancelled in

exercise of powers under Section 48 of

the Land Acquisition Act. Power under

Section 21 of the General Clauses Act

cannot be exercised after vesting of the

land statutorily in the State

Government."

Similarly, even in the case of National Thermal Power

Corporation Limited v. Mahesh Dutta and Others [(2009) 8 SCC

339], the Government had desired to withdraw lands from

acquisition after the lands had vested in it, in exercise of its

power under Section 48 of the Act. Rejecting the contention of

the State in paragraph 16 of the judgment, the Court stated

that `it is a well settled proposition of law that in the event the

possession of the land, in respect whereof a notification had

been issued, had been taken over, the State would be denuded

of its power to withdraw from the acquisition in terms of

Section 48 of the Act.' The Court then went to the extent of

87

expressing the view that the possession taken may be

symbolic or actual.

I must notice that in the case of U.P. Jal Nigam, Lucknow

through its Chairman and Another v. Kalra Properties (P) Ltd.,

Lucknow & Others [(1996) 3 SCC 124], a Bench of this Court

had made a passing observation in paragraph 3 of the

judgment:

"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 11A, as

amended by the Act of 68 of 1984,

therefore, does not apply and the

acquisition does not lapse".

The aforesaid observations that the State may issue `a

notification under Section 48(1)' and this notification may be

`published in the Gazette withdrawing from the acquisition',

are nothing but an obiter of the Court without any discussion

thereto. The question whether the acquisition proceedings

lapse or that the notification cancelling acquisition could be

88

issued after the possession is taken, where the land has vested

in the Government did not arise in that case. The Court was

primarily concerned with three main questions:

1. What was the effect of possession of land subsequent to

notification issued under Section 4(1) of the Act?

2. Whether the provisions of Section 11A of the Act would

apply to the acquisition under Section 17(1) read with

Section 17(4) of the Act? and

3. How the market value should be determined?

Firstly, if the said interpretation is given, it shall be

contrary to the specific language of Section 48 of the Act.

Secondly, the learned Judges did not refer to any judgment of

this Court while making the observation that `it is further

settled law'. I have referred to the consistent view of this

Court right from the year 1970 till 2011 and no judgment to

the contrary has been brought to the notice of the Court.

Thus, I must hold that the observations made in paragraph 3,

89

as reproduced, are merely an obiter and not a binding

precedent.

The lands which have been acquired under the provisions

of Section 17 of the Act are incapable of being reverted to the

owners/persons interested. The Act does not make any such

provision and, thus, the Court is denuded of any such power.

The Court must exercise its power within the framework of

law, i.e., the provisions of the Act.

In the case of an ordinary acquisition, if the land has

vested in the State Government then neither the Government

nor the court can take recourse to the provisions of Section

48(1) of the Act, there the question of applying Section 11A of

the Act to acquisition proceedings under Section 17 of the Act

cannot arise, as it would tantamount to achieving something

indirectly which would be impermissible to be achieved

directly. For all the above reasons, I hold that Section 11A of

the Act has no application to the acquisition proceedings

under the provisions of Section 17 of the Act.

90 There is no dispute in the present case that the

provisions of Section 11A of the Act have not been complied

with. Admittedly, the notification under Section 4(1) read with

Section 17(4) was published on 17th April, 2002, declaration

under Section 6 was made on 22nd August, 2002 and the

possession of the property was taken on 4th February, 2003.

The award has been made on 9th June, 2008, much after the

expiry of the prescribed period of two years under Section 11A

of the Act. There being an admitted violation of the provisions

of Section 11A of the Act, the natural consequence is that its

rigours would be attracted. However, the most pertinent

question that arises for consideration is: whether the

provisions of Section 11A of the Act are applicable to the

acquisition of land under Section 17 of the Act?

The main thrust of submissions on behalf of the

appellants is that the provisions of Section 11A of the Act

would be attracted even to the acquisition proceedings

undertaken by the appropriate Government in exercise of

powers vested in it under Section 17 of the Act. It is

91

contended that Section 17 in the scheme of the Act is at parity

to the normal and ordinary process of acquisition except that

it is a power to be exercised in urgent basis. The other

provisions like publication of notification under Section 4,

declaration under Section 6, notice under Sections 9 and 12

and passing of award under Section 11 of the Act are argued

to be essential features of an acquisition made under Section

17 of the Act as well. Thus, it is submitted that the provisions

of Section 11A of the Act would also apply to an acquisition

made under Section 17 of the Act. If an award is not made

within two years from the date of declaration under Section 6

of the Act, the acquisition proceedings should lapse

irrespective of whether the acquisition had commenced under

Section 4 by invoking powers of urgency or otherwise. It is

argued that there is no justification, whatsoever, for excluding

the application of Section 11A of the Act from acquisitions

made under Section 17 of the Act. On the contrary, the

contention on behalf of the respondents is that provisions of

Section 11A of the Act have no application to the provisions of

Section 17 of the Act. In fact, there is an apparent, though

92

limited, conflict between these provisions. The very purpose

and object of the Act would stand defeated if provisions of

Section 11A of the Act are applied to the acquisitions under

Section 17 of the Act.

I may now examine the scheme of the Act, with particular

reference to the difference between acquisitions in exercise of

emergent powers under Section 17 of the Act and the

acquisitions made otherwise. In both the cases, notification

under Section 4(1) has to be published in accordance with the

provisions of the Act. Notification under Section 4 is a sine

qua non for commencement of the acquisition proceedings and

this has been the consistent view of this Court right from the

case of Narender Jeet Singh v. State of U.P. [(1970) 1 SCC 125]

wherein the Court clearly held that issuance of a notification

under sub-section (1) of Section 4 is a condition precedent to

exercise of any further powers under the Act and the

notification issued under that provision should comply with

the essential requirements of law under that provision.

Thereafter, the owners/persons interested have to be given an

93

opportunity to file objections as contemplated under Section

5A of the Act and after granting them hearing, a declaration

under Section 6 of the Act has to be published. Subsequent to

the publication of such a declaration, notice under Section

9(1) of the Act has to be issued stating the intention of the

Government to take possession of the land and that claims for

compensation and for all interests in such land may be made

to the competent authority. Following the procedure

prescribed, an award has to be made under Section 11 of the

Act awarding compensation for acquisition of the land with its

complete details. Under the scheme of the Act, in the event of

an ordinary acquisition in contradistinction to acquisition in

exercise of emergent powers, if the award is not made within a

period of two years from publication of the declaration under

Section 6, the acquisition proceedings would lapse. In these

proceedings, the possession of the land remains with the

claimant/owners of the land and it is only when the award

becomes final in terms of Section 12 of the Act, possession of

the land is taken and the acquired land vests in the

94

Government free from all encumbrances under Section 16 of

the Act.

Where the lands are acquired in exercise of emergent

powers of the State under Section 17 of the Act, a notification

under Section 4(1) of the Act is issued and the notification

itself refers to the provisions of Section 17(1) as well as Section

17(4) of the Act. A specific power is vested in the appropriate

Government to declare that provisions of Section 5A would not

be applicable to such acquisition. Therefore, there is no

obligation upon the Collector/authority concerned to invite

and decide upon objections in terms of Section 5A of the Act,

prior to publication of a declaration under Section 6 of the Act.

However, notice under Section 9(1) of the Act has to be

published to completely and fully invoke the powers vested in

the State for taking possession of the land, in terms of Section

17(1) of the Act. After the expiry of 15 days from such

publication under Section 9(1), the possession of the land can

be validly taken by the Government, whereupon the land

would vest absolutely in the Government, free from all

95

encumbrances. In other words, for proper computation of the

specified period of 15 days, issuance of notification under

Section 9(1) of the Act would be necessary, but it cannot be

held to be mandatory in its operation so as to render the

execution proceedings invalid. In the case of May George

(supra), a Bench of this Court has expressed the view that the

notification under Section 9(1) of the Act as contemplated

under Section 17(1) of the Act is not mandatory.

Before the Government takes possession of the land in

exercise of its powers under Section 17(1) of the Act, it has to

comply with the requirements of Section 17(3A) of the Act.

The amount so paid, if falls short, and/or is in excess of

compensation actually due to the land owners, the same shall

be determined and adjusted while making the final award

under Section 11 of the Act. It is evident that both these

acquisitions have distinct schemes of acquisition. Section 17

of the Act itself refers to some other provisions, like Sections

5A, 9, 11, and 31 of the Act. Wherever such reference was

considered necessary by the Legislature, it has been so made.

96 Thus, there is no occasion for the Court to read into Section

17, the language of Section 11A of the Act which has not been

provided by the Legislature; more so when doing so would

destroy or frustrate the very object of the urgent acquisition.

Marked distinction between the implementation of these two

types of acquisition schemes contained in the Act is clearly

suggestive that these schemes operate in their respective fields

without any contradiction. Hence, the Court would adopt an

interpretation which would further such a cause, rather than

the one which will go contra to the very scheme of the Act.

In my considered view, it will be difficult for me to hold

that the provisions of Section 11A of the Act, despite being

mandatory, would apply to the scheme of acquisition

contained under Section 17 of the Act.

Whether the Claimants can be granted any relief even on

equitable grounds?

The facts, as already noticed by me above, are hardly in

dispute. Admittedly, the possession of the land had been

taken on 4th February, 2002 and the Writ Petition No. 2225

97

was filed by the petitioners in the year 2006 i.e. after the

possession has been taken. In terms of Section 17(1) of the

Act, the land has been vested absolutely and free from all

encumbrances in the Government. After vesting of the land,

the development activity had been carried out over the years

and it is informed that Sector 88, NOIDA is fully developed

and operational.

Once the development activity has been completed in the

entire sector, will it be equitable to release the lands from

acquisition? Even if for the sake of argument, it is assumed

that there is some merit in the contention raised on behalf of

the appellant, the answer has to be in the negative. It is

settled canon of equitable jurisdiction that the person who

feels aggrieved by an action of the State should approach the

Court without any unnecessary delay, particularly in cases

such as the present one. While the notification under Section

4 read with Sections 17(1) and 17(4) of the Act was issued on

14th April, 2002 and possession taken on 4th February, 2003

the writ petitions in question were filed in August 2006, i.e.,

98

more than four years subsequent to the issuance of the

notification under Section 4. It was contended that the cause

of action to challenge the acquisition proceedings arose only

after the period of two years had lapsed from the date of

issuance of the notification. Even if that be so, still there is an

unexplained and undue delay of more than two years in

approaching the Court. This would itself disentitle the

appellants to claim any equitable relief in the facts and

circumstances of the present case.

I must not be understood to say that in every case of

delay, per se, the Court would decline to exercise its

jurisdiction if the party to the lis can otherwise be granted

relief in accordance with law. This has to be decided keeping

in view the facts and circumstances of a given case.

It is not in dispute and, in fact, can hardly be disputed

that in the intervening period of nearly ten years, the acquired

areas have fully developed. Not only this, it is informed during

the course of hearing that the award was finally made by the

authorities on 9th June, 2008 and has been accepted by nearly

99

97.6 per cent of the owners whose lands were acquired vide

the said notification. In other words, nearly all land owners

have accepted the award and permitted the development

activity to be carried out. This conduct of the owners as a

whole would again be a factor which will weigh against the

grant of any relief to the appellants. Huge amounts of money

and resources of the State, as well as other bodies or persons

have been invested on the development of this sector which is

stated to be an industrial sector. It will be unjust and unfair

to uproot such a developed sector on the plea raised by the

present appellants. In this view, I am fully supported by the

judgment of a Division Bench of this Court, to which my

learned brother (Ganguly, J.) was a member, in the case of

Tamil Nadu Housing Board v. L. Chandrasekaran (Dead) by

Lrs. & Ors. [(2010) 2 SCC 786]. The Bench was primarily

dealing with the question of re-conveyance of the acquired

lands on the grounds of discrimination and arbitrariness. The

High Court had passed a direction against the Board to re-

convey the acquired land, which was held by this Court, on

appeal, to be contrary to the provisions of Section 48 of the

100

Act. This Court settled the point of law holding that it is not

appropriate for the Court to quash the acquisition proceedings

at the instance of one or two land owners, where the

development had taken place and majority of the land owners

had not challenged the acquisition. The Court, while relying

upon the case of A.S. Naidu v. State of Tamil Nadu [(2010) 2

SCC 801] held as under:

"15. The first issue which requires consideration is whether the order passed by this Court in A.S. Naidu case has the effect of nullifying the acquisition in its entirety. In this context, it is apposite to mention that neither the appellant Board nor have the respondents placed before the Court copies of the writ petitions in which the acquisition proceedings were challenged, order(s) passed by the High Court and the special leave petitions which were disposed of by this Court on 21-8-19903 and without going through those documents, it is not possible to record a finding that while disposing of the special leave petitions preferred by A.S. Naidu and others, this Court had quashed the entire acquisition proceedings. So far as A.S. Naidu is concerned, he did not even make a prayer before the High Court for quashing the preliminary notification issued under Section 4(1) of the Act.

16. This is evident from the prayer made by him in Writ Petition No. 7499 of 1983, which reads as under:

101

"For the reasons stated in the accompanying affidavit, it is most respectfully prayed that this Hon'ble Court may be pleased to issue a writ of certiorari or any other proceeding or any other appropriate writ or direction or order in the nature of a writ to call for the records of the first respondent relating to GOMs No. 1502, Housing and Urban Development Department dated 7-

11-1978 published in the Tamil Nadu Government Gazette Extraordinary dated 10-11-1978 in Part II Section 2 on pp. 22 to 26 and quash the said notification issued under Section 6 of the Land Acquisition Act, 1894 insofar as it relates to the land in the petitioners' layout approved by the Director of Town Planning in LPDM/DTP/2/75 dated 7-3-1975 in Survey Nos. 254, 257, 258, 260, 268 and 271 in Mogapperi Village, No. 81, Block V, Saidapet Taluk, Chingleput District and render justice."

From the above reproduced prayer

clause, it is crystal clear that the only

relief sought by Shri A.S. Naidu was for

quashing the notification issued under

Section 6 insofar it related to the land

falling in Survey Nos. 254, 257, 258, 260,

268 and 271 in Mogapperi Village, No.

81, Block V, Saidapet Taluk and in the

absence of a specific prayer having been

made in that regard, neither the High

Court nor this Court could have quashed

the entire acquisition. This appears to be

the reason why the Division Bench of the

High Court, while disposing of Writ

Appeals Nos. 676 of 1997 and 8-9 of

1998 observed that quashing of

acquisition by this Court was only in

relation to the land of the petitioner of

that case and, at this belated stage, we

102

are not inclined to declare that order

dated 21-8-19903 passed by this Court

had the effect of nullifying the entire

acquisition and that too by ignoring that

the appellant Board has already utilised

portion of the acquired land for housing

and other purposes. Any such inferential

conclusion will have disastrous

consequences inasmuch as it will result

in uprooting those who may have settled

in the flats or houses constructed by the

appellant Board or who may have built

their houses on the allotted plots or

undertaken other activities.

XXX XXX XXX

26. A glance at the impugned order shows that the Division Bench did not at all advert to the factual matrix of the case and the reasons incorporated in the Government's decision not to reconvey the acquired land to the respondents. The Division Bench also did not examine the correctness or otherwise of the order passed by the learned Single Judge and allowed the appeals preferred by the respondents simply by relying upon order dated 18-2-2000 passed in Writ Appeal No. 2430 of 1999 and that too without even making an endeavour to find out whether the two cases were similar. In our view, the direction given by the Division Bench to the appellant Board to reconvey the acquired land to the respondents is per se against the plain language of Section 48-B of the Act in terms of which only the Government can transfer the acquired land if it is satisfied that the same is not required for the purpose for which it was acquired or for any other public purpose. The appellant Board is not an authority competent to transfer the acquired land to the original owner. Therefore, the Division Bench of the High Court could not have issued a mandamus to the appellant Board to

103

reconvey the acquired land to the respondents. As a matter of fact, the High Court could not have issued such direction even to the Government because the acquired land had already been transferred to the appellant Board and the latter had utilised substantial portion thereof for execution of the housing scheme and other public purposes.

27. There is one more reason why the impugned judgment deserves to be set aside. Undisputedly, the land of the respondents forms part of large chunk which was acquired for execution of the housing scheme. The report sent by the appellant Board to the State Government shows that the purpose for which the land was acquired is still subsisting. The respondents had neither pleaded before the High Court nor was any material produced by them to show that the report which formed basis of the Government's decision not to entertain their prayer for reconveyance of the land was vitiated by mala fides or that any extraneous or irrelevant factor had influenced the decision-making process or that there was violation of the rules of natural justice. Therefore, the Division Bench of the High Court could not have exercised the power of judicial review and indirectly annulled the decision contained in communication dated 18-3-1999.

28. It need no emphasis that in exercise of power under Section 48-B of the Act, the Government can release the acquired land only till the same continues to vest in it and that too if it is satisfied that the acquired land is not needed for the purpose for which it was acquired or for any other public purpose. To put it differently, if the acquired land has already been transferred to other agency, the Government cannot exercise power under Section 48-B of the Act and

104

reconvey the same to the original owner. In any case, the Government cannot be compelled to reconvey the land to the original owner if the same can be utilised for any public purpose other than the one for which it was acquired."

I am of the considered view that what has been stated by

the learned Judges in that case is squarely applicable, even on

facts, to the present case. Firstly, there is no merit in the

contentions of law raised by the appellants, which I have

already rejected. Secondly, even on equity, the appellants have

no case.

Before I part with this file, I cannot ignore one very

important aspect which has come to my notice during the

hearing of the case and which, as stated at the Bar, is an often

repeated default on the part of the Government Departments

causing undue inconvenience, harassment, hardship and

ultimately resulting in the acquisition itself being inequitable

against the land owners/persons interested therein. The

declaration under Section 6 was made on 22nd August, 2002,

the notice under Section 9(1) had been issued and possession

of the land was taken on 4th February, 2003. In the normal

105

course and as per the requirements of the provisions of

Section 17(3A) read with Section 17(1), 80 per cent of the

estimated compensation ought to have been paid to the

owners of the land/persons interested, within that period prior

to taking possession and/or, in any case, within a very limited

and reasonable time. This I am only noticing subject to my

finding that there is unequivocal statutory obligation upon the

respondents to pay the amount prior to taking possession of

the land in question. However, the award made on 9th June,

2008 would have otherwise vitiated the entire acquisition

proceedings, but for the fact that, as held by me above and for

reasons recorded supra that Section 11A does not apply to the

acquisition made in exercise of emergent powers in terms of

Section 17 of the Act. Still, to do things within a reasonable

time is an obligation of the State, as is imposed by the

Legislature itself and even otherwise as per the canons of

proper governance, i.e., vigilantibus, non dormientibus, jura

subveniunt, which means the laws assist those who are

vigilant, not those who sleep over their rights. According to

Respondent No.2, they had deposited 10 per cent of the

106

estimated compensation prior to issuance of notification under

Section 4, i.e., 17th April, 2002 and 70 per cent of the amount

was deposited with the Government on 8/14th July, 2002 by a

cheque. The amount deposited was nearly ` 6,66,00,000/-

and odd. For reasons best known to the State Government,

this amount was not disbursed to the claimants until passing

of the award. In other words, the amount was made available

to the Government and its authorities for disbursement to the

owner/claimants prior to (or soon after) taking of the

possession, which was taken on 4th February, 2003, but still

the claimants were deprived of their legitimate dues without

any justification or reason. In order to show this, learned

counsel appearing for respondent No.2 had even shown the

records to the Court. It was also the duty of respondent No.2

to ensure that the payments were made to the claimants prior

to taking of possession but, in any case, it was an unequivocal

statutory obligation on the part of the State/Collector to

ensure that the payments were made to the claimants in terms

of Section 17(1) read with Section 17(3A) prior to taking of

possession. No justification whatsoever had been advanced

107

and can be advanced for such an intentional default and the

casual attitude of the concerned officers/officials in the State

hierarchy.

These authorities are instrumentalities of the State and

the officers are empowered to exercise the power on behalf of

the State. Such exercise of power attains greater significance

when it arises from the statutory provisions. The level of

expectation of timely and just performance of duty is higher,

as compared to the cases where the power is executively

exercised in discharge of its regular business. Thus, all

administrative norms and principles of fair performance are

applicable to them with equal force, as they are to the

Government department, if not with a greater rigour. The well

established precepts of public trust and public accountability

are fully applicable to the functions which emerge from the

public servants or even the persons holding public office. In

the case of State of Bihar v. Subhash Singh [(1997) 4 SCC 430],

this Court, in exercise of the powers of judicial review, stated

that the doctrine of `full faith and credit' applies to the acts

108

done by the officers in the hierarchy of the State. They have to

faithfully discharge their duties to elongate public purpose.

The concept of public accountability and performance of

functions takes in its ambit, proper and timely action in

accordance with law. Public duty and public obligation both

are essentials of good administration whether by the State or

its instrumentalities. In the case of Centre for Public Interest

Litigation & Anr. v. Union of India & Anr. [(2005) 8 SCC 202],

this Court declared the dictum that State actions causing loss

are actionable under public law. This is a result of innovation,

a new tool with the courts which are the protectors of civil

liberties of the citizens and would ensure protection against

devastating results of State action. The principles of public

accountability and transparency in State action are applicable

to cases of executive or statutory exercise of power, besides

requiring that such actions also not lack bona fides. All these

principles enunciated by the Court over a passage of time

clearly mandate that public officers are answerable for both

their inaction and irresponsible actions. If what ought to have

109

been done is not done, responsibility should be fixed on the

erring officers; then alone, the real public purpose of an

answerable administration would be satisfied.

The doctrine of `full faith and credit' applies to the acts

done by the officers. There is a presumptive evidence of

regularity in official acts, done or performed, and there should

be faithful discharge of duties to elongate public purpose in

accordance with the procedure prescribed. Avoidance and

delay in decision making process in Government hierarchy is a

matter of growing concern. Sometimes delayed decisions can

cause prejudice to the rights of the parties besides there being

violation of the statutory rule. This Court had occasion to

express its concern in different cases from time to time in

relation to such matters. In the case of State of Andhra

Pradesh v. Food Corporation of India [(2004) 13 SCC 53], this

Court observed that it is a known fact that in transactions of

Government business, no one would own personal

responsibility and decisions would be leisurely taken at

various levels.

110 Principles of public accountability are applicable to such

officers/officials with all their rigour. Greater the power to

decide, higher is the responsibility to be just and fair. The

dimensions of administrative law permit judicial intervention

in decisions, though of administrative nature, which are ex

facie discriminatory. The adverse impact of lack of probity in

discharge of public duties can result in varied defects, not only

in the decision making process but in the final decision as

well. Every officer in the hierarchy of the State, by virtue of

his being `public officer' or `public servant', is accountable for

his decisions to the public as well as to the State. This

concept of dual responsibility should be applied with its

rigours in the larger public interest and for proper governance.

I find no justification, whatsoever, for the Government,

despite deposit by the beneficiary, not to pay 80 per cent of the

estimated compensation due to the claimants within the

requisite time and not even within the reasonable time. It was

breach of statutory and governance obligation of the State's

officers/officials to pay the amount to the claimants after more

111

than five years. It is expected of the State officers not to forget

that these are compulsory acquisitions in exercise of State's

power of eminent domain and the legislative intent behind

providing safeguards and some benefits against such

acquisition ought not to be frustrated by inaction and

omissions on the part of the officers/officials. There being

patent unexplained mistakes, omissions and errors,

committed by the officers/officials in the State of Uttar

Pradesh in dealing with this entire matter, I hereby impose

cost of ` 1,00,000/- on the State Government which at the first

instance shall be paid by the State to the owners of the land,

i.e., present appellants or persons situated alike. However this

amount shall be recovered from the salary of all the

officers/officials found guilty by the State which shall conduct

an inquiry for that purpose in accordance with law. The

inquiry shall be completed within a period of six months from

today and a report shall be submitted to the Secretary General

of this Court on the administrative side. Imperatively, it must

follow that the Central Government and all State Governments

must issue appropriate directions to ensure that there is no

112

harassment, hardship or inequality caused to the

owners/persons interested in the lands acquired by the State,

in exercise of its powers of eminent domain under Section

17(1) of the Act. Wherever the payments are not made within

time and appropriate steps are not taken to finalize the

acquisition of the land, the concerned Government should

take appropriate disciplinary action against the erring

officers/officials involved in and responsible for the process of

acquisition.

I will prefer to record my conclusions and also answer the

four legal questions (`A' to `D') as framed in the judgment by

my learned brother. They are as follows:

(A)I hold and declare that Section 11A of the Act has no

application to the acquisition proceedings conducted under

the provisions of Section 17 of the Act;

Once the acquired land has vested in the Government in

terms of Section 16 or 17(1) of the Act, possession of

which has already been taken, such land is incapable of

being re-vested or reverted to the owners/persons

113

interested therein, for lack of any statutory provision for

the same under the Act.

(B) The provisions of Section 17(3A) of the Act, on their

bare reading, suggest that the said provision is mandatory

but, as no consequences of default have been prescribed by

the Legislature in that provision, thus, it will hardly be

permissible for the Court to read into the said provision any

drastic consequences much less lapsing of entire

acquisition proceedings. In other words, default in

complying with provisions of Section 17(3A) cannot result in

invalidating or vitiating the entire acquisition proceedings,

particularly when the possession of the acquired land has

been taken and it has vested in the Government free from

all encumbrances.

(C) Keeping in view the scheme of the Act, the provisions

of Section 17 of the Act can be construed strictly but such

interpretation must be coupled with the doctrine of literal

and contextual interpretation, while ensuring that the

object of the legislation is not defeated by such an

114

interpretation. Strict compliance to the conditions

contemplated under Section 17 of the Act should be given

effect to but within the framework of the statute, without

making any additions to the language of the section.

(D) Once the right to property ceases to be a Fundamental

Right after omission of Articles 19(1)(f) of the Constitution of

India, the addition of Articles 31A and 300A by the 44th

Constitutional Amendment, 1978, cannot place the legal

right to property at the same pedestal to that of a

fundamental right falling under Chapter III of the

Constitution. It has been clearly held by the Courts that

the provisions of the Land Acquisition Act are not violative

of Article 14 of the Constitution. The rights of the citizens

and interest of the State can be balanced under the

provisions of the Act, without any violation of the

Constitutional mandate.

Besides answering the questions of law and stating my

conclusions as above, it is both appropriate and necessary to

pass certain directive orders to ensure the maintenance of

115

balance between the might of the State on the one hand and

the rights of land owners on the other. It is, therefore,

necessary to issue the following directions :

(i) The Government/acquiring authority shall be liable to

pay interest at the rate of 15 per cent per annum with

reference to or alike the provisions of Section 34 of the

Act, after the expiry of 15 days from issuance of

notification under Section 9(1) of the Act, and from the

date on which the possession of the land is taken, till the

amount of 80 per cent of the estimated compensation is

paid to the claimants.

In the facts of the present case, it is clear that 80 per

cent of the estimated compensation had been deposited

by the beneficiary. However, it is no way clear on record

that these amounts had actually been received by the

owners/interested persons. Where the amounts have

been paid beyond the period as stated in Section 17(3A),

the claimants still would be entitled to the rate of interest

afore-indicated. Interest should be computed from the

116

date of the notification till the date of payment to the

claimants. The Government is also liable to pay interest

as afore-indicated on the balance amount determined

upon making of an award in accordance with Section 11

of the Act.

(ii) The Central Government and all the State Governments

shall issue appropriate and uniform guidelines, within 8

weeks from today, to ensure that the land owners and

the persons interested in the lands cquired by the State

or its instrumentalities are not put to any undue

harassment, hardship and inequity because of inaction

and omission on the part of the acquiring authority, in

cases of urgent acquisition under Section 17 of the Act.

The Government should ensure timely action for

acquisition and payment of compensation in terms of the

provisions of the Act, particularly Section 17(3A) of the

Act, as explained in this judgment.

(iii) Wherever the Government exercises its power under

Section 17(1) of the Act and there is default in deposit of

117

the amount in terms of Section 17(3A) of the Act, as

explained in this judgment, the concerned Government

shall take appropriate disciplinary action against the

erring officers/officials including making good the loss

caused to the Government revenue on account of the

liabilities towards interest or otherwise, because of such

undue delay on the part of such officers/officials;

(iv) In this case, the claimants would be entitled to the cost

of ` 1,00,000/- (Rupees one lakh only) which shall be

deposited at the first instance by the State Government of

Uttar Pradesh and then would be recovered from the

salaries of the defaulting/erring officers/officials in

accordance with law. The inquiry shall be completed

within a period of six months from today and a report

shall be submitted to the Secretary General of this Court

on the administrative side immediately thereafter.

In result, the appeal is accordingly dismissed with the

above directions.

118 ..

...........................................J.

[Swatanter Kumar]

New Delhi;

August 18, 2011

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.24 OF 2009

M/s. Delhi Airtech Services

Pvt. Ltd. & Anr. ... Appellants

Versus

State of U.P. & Anr. ... Respondents

J U D G M E N T

Ganguly, J.

1. The facts giving rise to the present appeal are simple

and fall within a narrow compass. However, they raise

questions which are of public importance and legal

significance. Thus, it will be appropriate for us to state the

questions of law at the very threshold:

A. When the Government, in exercise of its emergency

powers under Section 17 of the Land Acquisition Act,

1894 (for short the `Act') acquires lands, which have

since vested in the State, can such an acquisition

proceeding lapse and consequently the land can be

119

transferred to the owners/persons interested in the

event of default by the State, in complying with the

provisions of Section 11A of the Act?

B. Whether the provisions of Section 17(3A) of the Act are

mandatory or directory? In either event, would non-

compliance with this Section have the effect of

invalidating or vitiating the entire acquisition

proceedings, even where the land has vested in the

State in terms of Section 17(1) of the Act?

C. Whether with the invoking of the emergency provisions

which have the effect of dispensing with the provision

of hearing under Section 5A of the Act, the Court is

entitled to construe the emergency provisions strictly,

being drastic provisions in an exproprietory law and

consider the safeguards inbuilt in Section 17(3A)

against such drastic provisions as conditions

precedent and mandatory for a valid exercise of

emergency provisions.

D. Whether having regard to the principle of

reasonableness being a basic component of

120

fundamental rights under the Constitution, this Court

has to construe the provisions of the said Act, a pre-

constitutional law in consonance with reason and

justice-the fundamental tenets of Article 14 and thus

arrive at a balanced interpretation of the interest of the

State as against the rights of citizens or land owners.

FACTS:

2. The appellant No.1 is a company duly incorporated

under the provisions of the Indian Companies Act,

1956 and is alleged to be the owner of the land sought

to be acquired by the respondents. The appellant's

land, admeasuring about 2-06-1/3-0 Bighas situated

in Village Haldauni, Tehsil and Pargana Dadri, District

Gautam Budh Nagar which is abadi land, was sought

to be acquired by the appropriate Government under a

notification dated 17th April, 2002 issued under

Section 4(1) read with Sections 17(1) and 17(4) of the

Act. This land was acquired for the planned industrial

development in District Gautam Budh Nagar through

the New Okhla Industrial Development Authority

121

(NOIDA). The notification also stated that the

provisions of Section 5A of the Act shall not apply. In

pursuance to the said notification, a declaration under

Section 6 of the Act was published on 22nd August,

2002, declaring the area which was required by the

Government. It also stated that after expiry of 15 days

from the date of the publication of the notification

under sub-section (1) of Section 9 of the Act,

possession of the acquired land shall be taken. The

appellants have alleged that they did not receive any

notice under Section 9(1) of the Act but possession of

the land was nevertheless taken on 4th February, 2003.

According to the appellants, even after a lapse of more

than three and a half years after the declaration under

Section 6 of the Act, no award had been made and

published.

3. The appellants further alleged that, despite inordinate

delay, they were neither paid 80 per cent of the

estimated compensation in terms of Section 17(3A) of

the Act at the time of taking of possession, nor had the

Collector passed an award within two years of making

122

the declaration under Section 17(1), as required by

Section 11A of the Act. It was the case of the

appellants that this has the effect of vitiating the entire

acquisition proceedings. Non-payment of

compensation and conduct of the Government

compelled the appellants to file a writ petition in the

High Court of Allahabad praying for issuance of an

order or direction in the nature of certiorari or any

other writ, and not to create any encumbrance or

interest on the land of the appellants. Further, they

prayed that the acquisition proceedings, insofar as

they relate to the land of the appellants, be declared

void ab initio and that the respondents be directed to

return the land under the possession of the

Government to the owners. Lastly, the appellants pray

that the respondents/Government be directed to pay

damages for use and occupation of the land.

4. To this writ petition, on behalf of NOIDA a counter

affidavit was filed in the High Court, denying that the

acquired land was in fact part of abadi land. NOIDA

also stated that 80 per cent compensation in terms of

123 Section 17(3A) had been deposited with the state

authorities. The land had been acquired for planned

development of NOIDA and it was in the physical

possession of the said authority. Possession of the

land had been taken on 4th February, 2003 and no

right had survived in favour of the appellant as the

land had vested in the Government.

5. The High Court, vide its judgment dated 28th August,

2006, dismissed the writ petition. The High Court

relied upon the judgment of this Court in the case of

Satendra Prasad Jain & Ors. v. State of U.P. &

Ors., [AIR 1993 SC 2517 = (1993) 4 SCC 369], and

dismissed the petition as the High Court held that

provisions of Section 11A of the Act are not attracted

to proceedings for acquisition by the Government

under Section 17 of the Act. However, liberty was

granted to the appellants to pray for grant of

appropriate compensation in accordance with law

before the competent forum.

124 6. Aggrieved by the said order of the High Court, the

appellants have filed the present appeal impugning the

judgment dated 28th August, 2006.

7. In the counter affidavit filed before this Court by

NOIDA, the stand in the counter filed before the High

Court has been reiterated, with an additional fact that

the sector in question was designated as industrial

area, and, after development activity was completed,

allotment has been made and possession of these

industrial plots has also handed over to such

entrepreneurs/allottees. This falls under Sector 88 of

the NOIDA City. The rest of the allegations made in the

writ petition, except the dates in question, have been

disputed.

8. It has also been stated at the Bar by the State

Counsel, on the basis of the record, without filing an

affidavit, despite directions given to that effect by this

Court on 5.1.2009, that 10 per cent of the estimated

compensation was deposited by NOIDA with the State

Government even prior to the date of the notification

125

under Section 4(1) read with Section 17(4) of the Act,

issued by the Government on 17.4.2002. The

remaining 70 per cent of the estimated compensation

had been allegedly deposited vide cheque dated 8/14th

July, 2002 amounting to approximately

Rs.6,66,00,000/-. As such, it is claimed there is

compliance with the provisions of Section 17(3A) of the

Act. The Award was made on 9.6.2008, which has

been accepted by a large number of owners, i.e., 97.6

per cent of all owners. Some of these facts have also

been averred in the counter affidavit of NOIDA filed

before the High Court.

9. It may be noted that neither before the High Court nor

before this Court any affidavit was filed either by the

State or by the Collector. The assertion of the appellant

about non-payment of compensation as contemplated

under Section 17(3A) of the Act has not been

controverted. Such payment has to be tendered by the

Collector to the person interested and entitled to the

same, subject to certain statutory conditions.

Assuming there has been deposit of 80% of the

126

compensation amount by NOIDA with the state

authorities, that does not satisfy the requirement of

Section 17(3A) of the Act. From the above pleadings of

the parties, the admitted facts that emerge from the

record can be usefully recapitulated.

10. The Governor of State of Uttar Pradesh on 17th April,

2002, issued a notification under Section 4(1) of the

Act, expressing the intention of the Government to

acquire the land stated in the said Notification for a

public purpose, namely, for the planned industrial

development in District of Gautam Budha Nagar

through NOIDA. Vide the same notification the

emergency provisions contained in Section 17 of the

Act, specifically Section 17(4) of the Act, were also

invoked, intimating the public at large that the

provisions of Section 5A of the Act shall not be

applicable. After issuance of the declaration under

Section 6 of the Act, admittedly the possession of the

land in question was taken on 4th February, 2003.

Another undisputed fact is that the claimants-owners

of the land were not paid 80 per cent of the estimated

127

compensation prior to taking of possession in terms of

Section 17(3A) of the Act.

11. The Collector had not made or published this award

even at the time of pronouncement of the judgment of

the High Court, in Writ Petition No. 22251 of 2006, on

28 August 2006. The High Court, in the impugned

judgment, directed respondent No.1 to ensure that the

Award is made as early as possible, preferably within a

period of three months from the date of production of

the certified copy of that order. In the counter affidavit

filed before this Court by NOIDA, it has been stated

that the Award was finally made and published on 9th

June, 2008. According to the appellant, in terms of

Section 11A of the Act, the Award ought to have been

pronounced on or before 26th August, 2004 as the

declaration under Section 6 of the Act was dated 22nd

August, 2002.

Legal Issues

12. If I may consider certain features of the said Act and

the constitutional provisions.

128 13. Enactment of the said Act was rooted in the colonial

past of this country having been brought on the

statute book on 1894 as Act 1 of 1984. With

enormous expansion of State's role in promoting

welfare and development activities since independence,

acquisition of land for public purposes increased with

the passage of time. Several decades after the

enactment of the Act, came Constitution in India in

1950. Along with it came the concept of social and

economic justice based on expansive values of human

rights. Under article 366 (10) of the Constitution the

Act was an `existing law' made before the

commencement of the Constitution.

Article 366(10) is quoted below:-

"366 (10) "existing law" means any law,

Ordinance, order, bye-law, rule or regulation

passed or made before the commencement of

this Constitution by any Legislature, authority

or person having power to make such a law,

Ordinance, order, bye-law, rule or regulation;"

129

14. Article 372 of the Constitution provides for

continuance in force of such `existing law' and their

adaptation. Article 372 (1) of the Constitution makes it

clear that notwithstanding the provision of the Article

395, but subject to the other provisions of the

Constitution, all laws in force in the territory of India

immediately before the commencement of the

Constitution shall continue in force until altered or

repealed or amended by a competent Legislature or

other competent authority.

15. Article 13 of the Constitution, which is a part of

Fundamental Right (Part III), also defines `laws in force'

under Article 13(3)(b). Article 13(3)(b) is set out:-

"13 (3) (b) "laws in force" includes laws passed

or made by a Legislature or other competent

authority in the territory of India before the

commencement of this Constitution and not

previously repealed, notwithstanding that any

such law or any part thereof may not be then

in operation either at all or in particular

areas."

130

16. The said definition of `laws in force' under Article 13(3)

(b) with certain changes, is consistent with the

definition of `existing laws' in Article 366(10).

17. The said Act is thus both an `existing law' within the

meaning of Article 366(10) and `laws in force' within

the meaning of Article 13(3)(b) of the Constitution.

18. Article 13(1), which is relevant in this context, is set

out below:

"Article 13. Laws inconsistent with or in

derogation of the fundamental rights: (1) All

laws in force in the territory of India

immediately before the commencement of this

Constitution, in so far as they are inconsistent

with the provisions of this Part, shall, to the

extent of such inconsistency, be void."

19. Under Article 372 such laws in force can continue with

some amendments, subject to `the other provisions of

this Constitution'. Article 13 certainly comes within

`the other provisions of the Constitution'.

20. Therefore, Article 372 and Article 13 must be read

together in as much as both the articles relate to

continuance of pre-constitutional laws validly made.

131 Article 372 permits such continuance and Article 13

stipulates the condition on which they can continue.

Article 13 is of greater importance as it is part of

fundamental right and makes all laws, whether pre or

post-constitution, subject to the primacy of

fundamental rights. The continuance of the said Act is

thus made to depend on its compliance with the

mandate of Article 13. The mandate of Article 13(1) is

clear that such law can continue provided it is not

inconsistent with the provision of Part III. In the event

of such laws becoming inconsistent with the provision

of Part III, such laws, to the extent of their

inconsistency, shall be void. This is the mandate of the

Constitution.

21. Therefore, several amendments were made to the said

Act keeping in view the broad concept of social and

economic justice which is one of the main

constitutional goals. In the instant case I am

concerned with some amendments to the said Act by

amendment Act 68 of 1984 which took effect from 24th

September 1984. Among several new sections, Section

132 11(A) and 17(3A) were introduced by amendment to

the said Act.

22. From the Statement of Objects and Reasons for the

said amendment it will be clear that the said

amendment was brought into existence to give effect to

the message of social and economic justice based on

the concept of Social Welfare State on broad principles

of human rights. The Statements of Objects and

Reasons are as follows:

"With the enormous expansion of the State's role

in promoting public welfare and economic

development since independence, acquisition of

land for public purposes, industrialization,

building of institutions, etc., has become far more

numerous than ever before. While this is

inevitable, promotion of public purpose has to be

balanced with the rights of the individual whose

land is acquired, thereby often depriving him of

his means of livelihood. Again, acquisition of land

for private enterprises ought not to be placed on

the same footing as acquisition for the State or

for an enterprise under it. The individual and

institutions who are unavoidably to be deprived

of their property rights in land need to be

adequately compensated for the loss keeping in

view the sacrifice they have to make for the larger

interests of the community. 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.

133

2. It is necessary, therefore, to restructure the

legislative framework for acquisition of land so

that it is more adequately informed by this

objective of serving the interests of the

community in harmony with the rights of the

individual. Keeping the above objects in view and

considering the recommendations of the Law

Commission, the Land Acquisition Review

Committee as well as the State Governments,

institutions and individuals, proposals for

amendment to the Land Acquisition Act, 1894,

were formulated and a Bill for this purpose was

introduced in the Lok Sabha on the 30th April,

1982. The same has not been passed by either

House of Parliament. Since the introduction of

the Bill, various other proposals for amendment

of the Act have been received and they have also

been considered in consultation with State

Governments and other agencies. It is now

proposed to include all these proposals in a fresh

Bill after withdrawing the pending Bill...."

(emphasis added)

23. It is clear from the aforesaid objects and reasons that

by introducing the provisions of Section 11A and

17(3A) by way of amendment to the Act, greater

responsibility was fastened upon the concerned State

authorities, whereby they were obliged to make an

award within two years of the declaration made under

Section 6 of the Act. Thus the rights of the land owners

were sought to be protected by balancing the same

against the rights of the State. In respect of emergency

134

provisions where land is acquired without a hearing, it

is provided under Section 17(3A) that before taking

possession either under Section 17(1) and 17(2) it was

obligatory upon the authorities concerned to pay 80

per cent of the estimated compensation to the land

owners. This was also for protecting the right of the

land owners.

24. These amendments along with Statement, Objects and

Reasons are very crucial in interpretation of some of

the amended provisions. The amendment was brought

about in 1984 and by that time, the contents and

reach of Fundamental Rights in Part III, as interpreted

by this Court had assumed a very expansive profile. In

view of the mandate of Article 13, the provision of the

said Act must be tested on the anvil of the broad

interpretation of Fundamental Rights given by this

Court. In view of the decision of this Court in Maneka

Gandhi v. Union of India & Another - (1978) 1 SCC

248, the interpretation of Part III rights namely rights

under Article 14, 19 and 21 given therein by this

Court, read with Article 141, becomes the law of the

135

land. Therefore, the reach of Article 13(1) is

correspondingly widened. Thus, the 1984 amendments

must be construed as a conscious attempt by the

legislature being aware of the expansive interpretation

of Fundamental Rights by this Court, to bring the said

act consistent with the rights of the citizens and

persons in Part III.

25. Despite the fact that Right to Property in terms of

Article 19(1)(f) of the Constitution stood deleted from

Chapter III of the Constitution, vide 44th Constitutional

Amendment, 1978, Article 300A of the Constitution

was added by the same Constitutional Amendment,

mandating that `no person shall be deprived of his

property save by authority of law'. This indicates that

the Constitution still mandates that right to property

may have ceased to be a fundamental right, but it is

still protected by the Constitution and is a

Constitutional right. Constitution also provides that

deprivation of that right cannot be brought about save

by authority of law.

136 26. It is accepted in every jurisprudence and by different

political thinkers that some amount of property right is

an indispensable safeguard against tyranny and

economic oppression of the Government. Jefferson was

of the view that liberty cannot long subsist without the

support of property. "Property must be secured, else

liberty cannot subsist" was the opinion of John Adams.

Indeed the view that property itself is the seed bed

which must be conserved if other constitutional values

are to flourish is the consensus among political

thinkers and jurists. The U.S. Supreme Court in

Dorothy Lynch v. Household Finance Corporation,

405 US 538: 31 L Ed. 2d 424 held:

"....the dichotomy between personal liberties and

property rights is a false one. Property does not

have rights. People have rights. The right to

enjoy property without unlawful deprivation, no

less than the right to speak or the right to travel,

is in truth a "personal" right, whether the

"property" in question be a welfare check, a

home, or a savings account. In fact, a

fundamental interdependence exists between the

personal right to liberty and the personal right

in property. Neither could have meaning without

the other. That rights in property are basic civil

rights has long been recognized. J. Locke, of

Civil Government 82-85 (1924); J. Adams, A

Defence of the Constitutions of Government of

137

the United States of America, in F. Coker,

Democracy, Liberty, and Property 121-132

(1942); 1 W. Blackstone, Commentaries 138-

140..." (P.552 of the report)

27. Justice K.K. Mathew in his treatise on "Democracy,

Equality and Freedom": (1978) very categorically

expressed the view:

"In a Society with a mixed economy, who can be

sure that freedom in relation to property might

not be regarded as an aspect of individual

freedom? People without property have a

tendency to become slaves. They become the

property of others as they have no property

themselves. They will come to say: "Make us

slaves, but feed us". Liberty, independence, self-

respect, have their roots in property. To denigrate

the institution of property is to shut one's eyes to

the stark reality evidenced by the innate instinct

and the steady object of pursuit of the vast

majority of people. Protection of property interest

may quite fairly be deemed in appropriate

circumstances an aspect of freedom." (P.38-39)

28. Explaining the interrelation between the right of

property and personal liberty, Learned Hand ruled that

property right is a personal right. (Learned Hand : The

Spirit of Liberty)

138

29. In our Constitution the word `law' finds place both in

Article 21 and in Article 300A. The term `law' in Article

21 has been interpreted by the Supreme Court from

time to time. In A.K. Gopalan v. State of Madras,

(AIR 1950 SC 27), the expression `law' meant enacted

law, meaning thereby if the law was passed by a

competent legislature and was not violative of any

other provision of the Constitution, the law would be

valid. But the said interpretation does no longer hold

good after the epoch making decision of this Court in

Maneka Gandhi (supra), where this Court held the law

does not mean any enacted piece. According to the

majority decision in Maneka Gandhi (supra) "law is

reasonable law not any enacted piece" (para 85 page

338 of the report)

30. In Maneka Gandhi (supra) this Court held that the

expression `procedure established by law' in Article 21

means a procedure established by a just, reasonable

and fair law. Thus the concept of due process of law

was incorporated in our constitutional framework by

139

way of judicial interpretation even though it was

rejected by the framers.

31. As a result of incorporation of this doctrine of `due

process' in our constitutional framework, the concept

of Articles 14 and 21 has undergone a sea-change. In

Maneka Gandhi (supra), Justice Bhagwati, as His

Lordship then was, gave a very dynamic interpretation

of Articles 14 and 21.

32. Even prior to the decision in Maneka Gandhi (supra),

a Constitution Bench of this Court in R.C. Cooper v.

Union of India - (1970) 1 SCC 248 also gave a

composite and integrated interpretation of rights under

Part III of the Constitution. The question before this

Court in R.C. Cooper (supra) was whether the rights

under Articles 19(1)(f) and 31(2) are mutually

exclusive. Answering the said question, the majority of

the Constitution Bench, speaking through Shah, J.

analysed the different features of Fundamental Rights

in para 52 at page 289 of the report and came to a

conclusion that part III of the Constitution "weaves a

140

pattern of guarantees on the texture of basic human

rights. The guarantees delimit the protection of those

rights in their allotted fields: they do not attempt to

enunciate distinct rights." (page 289)

33. In the following paragraph 53, the learned judges

further made it clear by saying:

"acquisition must be under the authority of a law

and the expression "law" means a law which is

within the competence of the Legislature, and

does not impair the guarantee of the rights in

Part III."

34. In view of this clear enunciation of law by two

Constitution Benches of this Court and the wording of

Article 300A of the Constitution, let us examine the

correctness of the impugned Judgment of the High

Court which relies only on S.P. Jain's case (supra).

35. The facts are totally different in S.P. Jain (supra). It is

clear from the facts in S.P. Jain (supra) that the third

respondent, the Krishi Utpadan Mandhi Samity, in

whose favour the land was acquired for construction of

market-yard, resolved on 13th January, 1989 to

withdraw from the acquisition as it was suffering from

141

a fund crunch and the proposed Mandhi site was far

away from Baraut (para 5).

36. The second round of litigation, out of which the

judgment in S.P. Jain (supra) was rendered by this

Court, was filed after the aforesaid resolution of the

third respondent was passed. Challenging the same,

the writ petition was filed before the High Court on 10th

August, 1989 wherein the writ petitioner prayed that

the State of Uttar Pradesh (the first respondent), The

Collector, Merrut (the second respondent) and the

Mandhi (the third respondent) be directed by Writ of

Mandamus to make and publish an award in respect

of the land. In that context this Court examined

various provisions of the Act and gave a direction upon

the first and second respondents to publish an award

within 12 weeks and imposed a cost of Rs.10,000/- on

the third respondent. In fact the writ petition in terms

of the prayer was allowed.

37. In coming to the aforesaid conclusion this Court held

that in a case where the emergency provisions are

142

invoked under Section 17 of the Act, the provisions of

Section 11A will not apply. And this Court came to an

incidental finding, though it was not strictly in issue,

that taking over the possession without making

payment under Section 17 (3A) of the Act is not illegal.

This finding was not at all necessary for deciding the

issue, namely whether prayer in the writ petition for

publishing the award was correctly made or not.

38. It has been held in the decision of this Court in

Municipal Corporation of Delhi v. Gurnam Kaur,

reported in AIR 1989 SC 38 that when a point does not

fall for decision of a Court but incidentally arises for its

consideration and is not necessary to be decided for

the ultimate decision of the case, such a decision does

not form a part of the ratio of the case but the same is

treated as a decision passed sub silentio. The concept

of `sub silentio' has been explained by Salmond on

Jurisprudence "12th Edition" as follows:

"A decision passes sub silentio, in the technical

sense that has come to be attached to that

phrase, when the particular point of law involved

in the decision is not perceived by the Court or

143

present to its mind. The Court may consciously

decide in favour of one party because of point A,

which it considers and pronounces upon. It may

be shown, however, that logically the Court

should not have decided in favour of the

particular party unless it also decided point B in

his favour; but point B was not argued or

considered by the Court. In such circumstances,

although point B was logically involved in the

facts and although the case had a specific

outcome, the decision is not an authority on

point B. Point B is said to pass sub silentio."

(page 43)

39. The aforesaid passage has been quoted with approval

by the three Judge Bench in Gurnam Kaur (supra).

This Court in Gurnam Kaur (supra), in order to

illustrate the aforesaid proposition further relied on the

decision of the English Court in Gerard v. Worth of

Paris Ltd., reported in 1936 (2) All England Reports

905. In Gerard, the only point argued was on the

question of priority of the claimant's debt. The Court

found that no consideration was given to the question

whether a garnishee order could be passed. Therefore,

a point in respect of which no argument was advanced

and no citation of authority was made is not binding

and would not be followed. This Court held that such

decisions, which are treated having been passed sub

144

silentio and without argument, are of no moment. The

Court further explained the position by saying that one

of the chief reasons behind the doctrine of precedent is

that once a matter is fully argued and decided the

same should not be reopened and mere casual

expression carry no weight. In Gurnam Kaur (supra)

this Court conclusively held that not every passing

expression of a Judge, however eminent, can be

treated as "ex cathedra statement, having the weight of

authority" (see para 12 page 43)

40. Similarly, it has also been held by the majority opinion

in Constitution Bench of this Court in the case of

Madhav Rao Jivaji Rao Scindia v. Union of India,

reported in AIR 1971 SC 530 that "it is difficult to

regard a word, a clause or a sentence occurring in a

judgment of this Court, divorced from its context, as

containing a full exposition of the law on a question

when the question did not even fall to be answered in

that judgment." (page 578 of the report) 145

41. In another Constitution Bench decision of this court in

Padma Sundara Rao (Dead) & Ors., v. State of Tamil

Nadu & others reported in (2002) 3 SCC 533, similar

views have been expressed by this Court in para 9, at

page 540 of the report wherein the unanimous

Constitution Bench of this Court opined:

"9. Court should not place reliance on decisions

without discussing as to how the factual

situation fits in with the fact situation of the

decision on which reliance is placed. There is

always peril in treting the words of a speech or

judgment as though they are words in a

legislative enactment, and it is to be remembered

that judicial utterances are made in the seting of

the facts of a particular case, said Lord Morris in

Herrington V. British Railways Board - (1972) AC

877. Circumstantial flexibility, one additional or

different fact may make a world of difference

between conclusions in two cases."

42. The reason behind enacting Section 17 (3A) of the Act

is clear from the Statement of Object and Reasons

extracted above. It is clear therefore the provisions

were incorporated in order to strike a balance between

the rights of the State and those of the land owner. A

clear legislative intent in Section 17(3A) was thus

expressed that before taking possession of any land

146

under sub-section (1) or sub-section (2) of Section 17,

the Collector shall tender payment of 80% of the

estimated compensation for such land to the persons

interested and entitled thereto. This is the clear

mandate of law.

43. In view of the principles enunciated in R.C. Cooper

(supra) and Maneka Gandhi (supra), reasonableness

in law has to be its implicit content. Here no challenge

to the reasonableness of Section 17 (3A) is either

argued or considered by this Court. But when law

gives a specific mandate on the State to tender the

payment before taking possession under Section 17(1)

and Section 17(2) by invoking the emergency powers,

to hold that the taking over of possession without

complying with that mandate is legal is clearly to

return a finding which is contrary to the express

provision of the statute. Such a finding is certainly not

on a reasonable interpretation of Section 17 (3A).

Therefore, the casual observation in para 17 (page 375)

in S.P. Jain (supra) to the effect of taking possession

of land under emergency provision and without

147

making the payment mandated under Section 17(3A) is

a valid mode of taking possession is in clear violation

of Section 17(3A) and be regarded made per incuriam

and does not have the effect of a binding precedent.

44. If I look at the emergency provisions of the statute

which empowers the State to acquire land by

dispensing with the provisions of making an enquiry it

is clear that the said provision is a drastic provision. It

is well-known that the provisions of the said Act are

expropriatory in nature and must be strictly

construed. In that expropriatory legislation, Section 17

is a very drastic provision as Section 17 of the Act

seeks to authorize acquisition and taking over of

possession without hearing the land owner. This Court

held that the right of hearing which is given under

Section 5A of the Act and which is taken away in view

of the emergency acquisition is a very valuable right

and is akin to a fundamental right. (See Dev Sharan &

Ors. v. State of U.P. & Ors. - JT 2011 (3) SC 102).

Therefore, when that right is taken away and the land

is acquired by invoking the emergency provision of

148 Section 17(3A) to hold that even the safeguards

provided under Section 17(3A) are not mandatory and

taking over of possession without complying with the

provisions of Section 17 (3A) is not illegal is to overlook

the clear provisions of the Act and come to a finding

which is contrary to the Act. This Court is unable to

accept that the taking over of the possession by

invoking Section 17(1) or Section 17(2) of the Act and

without making the payment under Section 17(3A) is

legal taking over of possession.

45. This Court is of the view that Section 17(3A) is not an

isolated provision. Section 17(3A) figures very

prominently as part of the statutory mechanism in

Section 17 of the Act which confers special powers in

cases of urgency. Section 17 has four sub sections and

all these sub sections comprise a composite

mechanism and are closely intertwined. Power under

one sub section cannot be exercised without complying

with the conditions imposed by the other sub section.

For a proper appreciation of this question, section 17

with all its sub sections are set out:

149 "17. Special powers in cases of urgency. (1) In

cases of urgency, whenever the appropriate

Government, so directs, the Collector, though no

such award has been made, may, on the

expiration of fifteen days from the publication of

the notice mentioned in section 9, sub-section (1),

take possession of any land needed for a public

purpose. Such land shall thereupon vest

absolutely in the Government, free from all

encumbrances.

(2) Whenever, owing to any sudden change in the

channel of any navigable river or other

unforeseen emergency, it becomes necessary for

any Railway administration to acquire the

immediate possession of any land 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, or the appropriate Government

considers it necessary to acquire the immediate

possession of any land for the purpose of

maintaining any structure or system pertaining to

irrigation, water supply, drainage, road

communication or electricity, the Collector may,

immediately after the publication of the notice

mentioned in sub-section (1) and with the

previous sanction of the appropriate Government,

enter upon and take possession of such land,

which shall thereupon vest absolutely in the

Government free from all encumbrances:

Provided that the Collector shall not take

possession of any building or part of a building

under this sub-section without giving to the

occupier thereof at least forty-eight hours' notice

of his intention so to do, or such longer notice as

may be reasonably sufficient to enable such

occupier to remove his movable property from

such building without unnecessary

inconvenience.

150 (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 provisions

herein contained.

(3A) 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.

(3B) The amount paid or deposited under sub-

section (3A), 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.

151 (4) In the case of any land to which, in the

opinion of the appropriate Government, the

provisions of sub-section (1) or sub-section (2) are

applicable, the appropriate Government may

direct that the provisions of section 5A shall not

apply, and, if it does so direct, a declaration may

be made under section 6 in respect of the land at

any time after the date of publication of the

notification under section 4, sub-section (1)."

46. Sub-section (3A) of Section 17 is linked with sub

section (2) of Section 31. Sub section (2) of Section 31

runs thus:

"(2) If they shall not consent to receive it, or if

there be no person competent to alienate the

land, or if there be any dispute as to the title to

receive the compensation or as to the

apportionment of it, the Collector shall deposit

the amount of the compensation in the Court to

which a reference under section 18 would be

submitted:

Provided that any person admitted to be

interested may receive such payment under

protest as to the sufficiency of the amount:

Provided also that no person who has received

the amount otherwise than under protest shall be

entitled to make any application under section

18:

Provided also that nothing herein contained shall

affect the liability of any person, who may receive

the whole or any part of any compensation

awarded under this Act, to pay the same to the

person lawfully entitled thereto."

152 47. It is thus clear that sub section (3A) of Section 17 read

with sub section (2) of Section 31 of the Act form a

composite statutory scheme. The said scheme has

been legislatively framed to balance the promotion of

public purpose in acquisition with rights of the

individual whose land is acquired. This is clear from

the Statement of Objects and Reasons which was kept

in view for bringing about the amendment of the said

Act by Amendment Act 68 of 1984. By the said

amendment Section 17(3A) was brought on the

statute.

48. Therefore, the provision of Section 17(3A) cannot be

viewed in isolation as it is an intrinsic and mandatory

step in exercising special powers in cases of

emergency. Sections 17(1) and 17(2) and 17(3A) must

be red together. Section 17(1) and 17(2) cannot be

worked out in isolation.

49. It is well settled as a canon of construction that a

statute has to be read as a whole and in its context. In

Attorney General v. HRH Prince Earnest Augustus

153

of Hanover, reported in (1957) 1 AER 49, Lord

Viscount Simonds very elegantly stated the principle

that it is the duty of Court to examine every word of a

statute in its context. The learned Law Lord further

said that in understanding the meaning of the

provision, the Court must take into consideration "not

only other enacting provisions of the same statute, but

its preamble, the existing state of the law, other

statutes in pari material, and the mischief which I can,

by those and other legitimate means, discern that the

statute was intended to remedy" (page 53 of the

report).

50. Lord Normand expressed the same view differently and

which is equally pertinent and worth remembering and

parts of which are excerpted below:

"The key to the opening of every law is the reason

and spirit of the law - it is the animus

imponentis, the intention of the law maker,

expressed in the law itself, taken as a whole.

Hence to arrive at the true meaning of any

particular phrase in a statute, that particular

phrase is not to be viewed detached from its

context ... meaning by this as well the title and

the preamble as the purview or enacting part of

the statute" (page 61 of the report).

154

51. These principles have been followed by this Court in its

Constitution Bench decision in Union of India v.

Sankalchand Himatlal Sheth & anr., [(1977) 4 SCC

193]. At page 240 of the report, Justice Bhagwati, as

His Lordship then was, in a concurring opinion held

that words in a statute cannot be read in isolation,

their colour and content are derived from their context

and every word in a statute is to be examined in its

context. His Lordship explained that the word context

has to be taken in its widest sense and expressly

quoted the formulations of Lord Viscount Simonds, set

out above. (See para 54, P.241 of the report).

52. In this connection, if I compare the normal mode of

vesting of acquired property under Section 16 of the

Act with the mode of vesting under emergency

provisions of Section 17 thereof, I will discern that

under the said Act the vesting of acquired property in

the State presupposes compliance with two conditions.

Under Section 16, first there has to be an award under

155 section 11 and then there has to be taking over of

possession. Only thereupon the land shall vest

absolutely in the state, free from all encumbrances.

Section 16 of the act which makes it clear is as under:

"16. Power to take possession.- When

the Collector has made an award under

section 11, he may take possession of the land,

which shall thereupon vest absolutely in the

Government, free from all encumbrances."

53. But in case of emergency acquisition, possession is

taken before the making of an award. This is clear

from section 17(1) and section 17(2). But the intention

of the legislature is that even though the award is not

made, payment mandated under Section 17(3A) must

be made before possession is taken either under

Section 17(1) and 17(2). Therefore this provision

relating to payment under Section 17(3A) is a condition

precedent to the vesting of land under Section 17(1)

and 17(2). In the later part of this judgment, I shall

discuss some authorities which have opined that when

possession is illegally taken over without following the

conditions precedent for taking such possession,

156

vesting of a property in law does not take place in the

authority which thus illegally enters upon the

property.

54. Judicial opinion is uniformly in favour of strict

construction of an expropriatory law which admittedly

Land Acquisition Act, 1894 is. Reference in this

connection can be made to the observations of

Cottenham, L.C. in Webb v. Manchester and Leeds

R ail Co . , [(1839), 4 Myl. & Cr.116] where the Lord

Chancellor held:

"The powers are so large - it may be necessary for

the benefit of the people - but they are so large,

and so injurious to the interests of the

individuals, that I think it is the duty of every

court to keep them most strictly within those

powers; and if there be any reasonable doubt as

to the extent of their powers, they must go

elsewhere and get enlarged powers; but they will

get none from me by way of construction of their

Act of Parliament."

55. In the Indian context, as early as in 1916. Judicial

committee of Privy Council in Secretary of State for

India v. Birendra Kishore Manikya (ILR 44 Cal 328),

speaking through Lord Dunedin held, `the Act is

157

drastic in its character and makes invasion in private

rights...matter must be brought "strictly within its

provisions".' (p 343)

56. Cripps in "The Law of Compensation for Land Acquired

under Compulsory Powers" (8th ed., Stevens and Sons,

Ltd.) has quoted the above opinion of the Lord

Chancellor and further dealt with this aspect of the

matter at page 27 of the book wherein the learned

author said, "Where the promoters of a public

undertaking have authority from Parliament to

interfere with private property on certain terms, any

person whose property is interfered with by virtue of

that authority has a right to require that the promoters

shall comply with the letter of the enactment, so far as

it makes provision on his behalf." Again at page 100,

the learned author has stressed the above position

very strongly to the following effect:-

"If no consent has been given, and the

promoters have not complied with the statutory

conditions as to entry on lands, they can be

proceeded against as trespassers by any owner

who has an interest in the lands. The principle

is that all statutory conditions which have been

158

imposed as condition precedent to an entry on

lands must be fulfilled."

57. In support of this aforesaid proposition, the learned

author has relied on Parkdale Corporation v. West

[(1887), 12 App. Cas. 602, 614].

58. And again at page 173, the learned author opines:

"It must be borne in mind that promoters have

no powers, other than those comprised in their

special Acts and the Acts therewith incorporated,

to enter upon or take lands against the wish of

the owners. It is incumbent on promoters to

comply with all conditions and limitations

imposed upon them, and, unless they have so

complied, any interested owner can restrain them

by injunction from taking, as against him, further

proceedings".

I am in respectful agreement with the aforesaid

principles.

59. I find that same principles have been laid down in

Cooley's `A Treatise on the Constitutional Limitations'

Volume II, (Eight Edition). Cooley while dealing with the

concept of `Eminent Domain' in Chapter 15 opined

(p.1120):

"...whenever in pursuance of law the property of

an individual is to be divested by proceedings

159

against his will, a strict compliance must be had

with all the provisions of law which are made for

his protection and benefit, or the proceeding will

be ineffectual. Those provisions must be

regarded as in the nature of conditions

precedent, which are not only to be observed

and complied with before the right of the

property owner is disturbed, but the party

claiming authority under the adverse proceeding

must show affirmatively such compliance".

(emphasis added)

60. The learned author explained the aforesaid proposition

with certain illustration which very closely fit in with

the legal framework with which I am concerned in this

case. The learned author said:

"So if the statute vests the title to lands

appropriated in the state or in a corporation on

payment therefore being made, it is evident that,

under the rule stated, the payment is a condition

precedent to the passing of the title."

(Emphasis added)

61. Reference in this connection should be made to the

decision of Supreme Court of Vermont in Henry B.

Stacey v The Vermont Central Railroad Co, (27 Vt.

39). In that case, while discussing the concept of

Eminent Domain, the court after referring to various

decisions held "that this provision (relating to deposit

160

of the appraised value) should be considered in the

nature of a condition precedent, not only to the

acquisition of the legal title to the land, but also to the

right to enter and take the permanent possession of

the land for the use of the corporation."

62. The expression condition precedent has been defined in

Words and Phrases (permanent edition, Vol. 8. St.

Paul, Minn, West Publishing Co., 1951, p 629) as those

which `must be punctually performed before the estate

can vest'. Similarly, in Bouvier's Law Dictionary, (A

Concise encyclopedia of the Law, Rawle's Third

Revision, Vol. 1, Vernon Law Book Company, 1914, p

584), virtually the same principles have been followed.

The learned author expressed this even more strongly

by explaining that:

"The effect of a Condition precedent is, when

performed, to vest an estate, give rise to an

obligation, or enlarge an estate already vested;

[...]. Unless a condition precedent be performed,

no estate will vest; and this even where the

performance is prevented by the act of God or of

the law; [...]."

161

63. In Wharton's Law Lexicon, it has been held that

conditions precedent in their primary meaning are

those events, but for the happenings of which rights

will not arise. (Wharton's Law Lexicon, 1976, reprint, p

228).

64. In the case of Gujarat Electricity Board v Girdharlal

Motilal And Anr (AIR 1969 SC 267), this court while

dealing with the power of the State Electricity Board to

purchase the property of the licensee held that right

can be exercised only in the manner provided in the

act and not in any other way. The court held that since

this power of the Board under the law is to interfere

with the property rights of the licensee, such power

will have to be strictly construed. In laying down the

said principle this court relied on the well-known

doctrine in case of Nazir Ahmad v King Emperor [AIR

1936 PC 253] that when a power is to be exercised in a

manner it has to be exercised in that manner alone

and in no other manner. In two other recent

judgments, this court reiterated the same principle,

and held that expropriatory statute, as is well known,

162

must be strictly construed. [See Hindustan Petroleum

corpn. Ltd., v. Darius Shapur Chenai and others

reported in (2005) 7 SCC 627]. The said principle has

also been followed by this Court in the case of Bharat

Petroleum Corporation Ltd. v Maddula Ratnavalli

and Others [(2007) 6 SCC 81] where learned judges

relying on Hindustan Petroleum reiterated the same

principle of strict construction of expropriatory

legislation (p 91).

65. In an earlier decision Jilubhai Nanbhai Khachar

and others v State of Gujarat and Anr [1995 Suppl

(1) SCC 596], this Court while dealing with the concept

of eminent domain and right to property in Article

300A held as follows (para 50, p. 628):

"50. All modern constitutions of democratic

character provide payment of compensation as

the condition to exercise the right of

expropriation. Commonwealth of Australia Act, a

Frecnh Civil Code (Article 545), the 5th

Amendment of the Constitution of USA and the

Italian constitution provided principles of "just

terms", "Just indemnity", Just compensation" as

reimbursement for the property taken, have been

provided for. As pointed out in Halsbury's Law of

England that "when Parliament has authorized

the compulsory acquisition of land it is almost

invariably provided for payment of a money

163

compensation to the person deprived of his

interest in it."

66. On the basis of aforesaid principles, I hold that the

requirement of payment under section 17(3A) is in the

nature of condition precedent clamped by the statute

before taking possession under emergency acquisition

by the State. The vesting contemplated either under

Section 17(1) or 17(2) of this Act is conditioned upon

payment mandated under Section 17(3A). This is clear

from the opening words of Section 17(3A) namely

"before taking possession of any land either under

sub-section (1) or (2), Collector shall....... tender

payment." Therefore, the eminent domain concept is

subject to the aforesaid statutory condition and must

be read subject to due process concept introduced in

our constitutional law in Maneka Gandhi (supra). If I

read, Section 17(3A) as I must, consistently with the

constitutional doctrine of due process as articulated in

the expression `authority of law' under Article 300A

which constitutionally protects deprivation of a right to

164

property, save by authority of law, the conclusion in

my judgment is inescapable that the requirement of

section 17(3A) constitutes the authority of law within

the meaning of Article 300A. Therefore, in the context

of aforesaid statutory dispensation and constitutional

provision, the debate whether the provision of section

17(3A) is mandatory or directory does not present

much difficulty for the reasons discussed above and

also for the following reasons.

67. Basically, the language used is `shall' which primarily

indicates mandatory compliance. That apart, in the

context of the nature of statute which is admittedly

expropriatory in character and the nature of the

statutory requirement under section 17(3A) which is

clearly and undoubtedly a condition precedent to the

taking over of possession in emergency acquisition,

there can be no doubt that the requirement under

section 17(3A) is mandatory.

68. Section 17(3A) has been enacted for protecting the

rights of deprived land-loser in an emergency

165

acquisition. The said provision is therefore based on

reason, justice and fairplay. Since the said provision

has been introduced by way of an amendment as

noted above to balance the right of the state as against

the interest of the land-loser, the State's power of

eminent domain is expressly made subject to aforesaid

statutory provision as also the constitutional right to

property protected under Article 300A. Right to

property has been pronounced as fundamental human

right by this Court in Chairman, Indore Vikas

Pradhikaran v. Pure Industrial Coke & Chemicals

Ltd., and others reported in (2007) 8 SCC 705.

69. The expression `law' which figures both in Article 21

and Article 300A must be given the same meaning. In

both the cases the law would mean a validly enacted

law. In order to be valid law it must be just, fair and

reasonable having regard to the requirement of Article

14 and 21 as explained in Maneka Gandhi (supra).

This is especially so, as `law' in both the Articles 21

and 300A is meant to prevent deprivation of rights.

Insofar as Article 21 is concerned, it is a Fundamental

166

Right whereas in Article 300A it is a constitutional

right which has been given a status of a basic human

right.

70. I, therefore, hold that Section 17(3A) of the Act is a law

which has been enacted to prevent deprivation of

property rights guaranteed under Article 300 A. This

provision of Section 17(3A) must therefore be given a

very broad interpretation to mean a law that gives a

fair, just and reasonable protection of the land-loser's

constitutional right to property.

71. Therefore, the provisions of section 17(3A) read with

Article 300A must be liberally construed. Reference in

this connection be made to the majority opinion in the

Constitution Bench decision in the case of Madhav

Rao Jivaji Rao Scindia (supra). Shah, J., speaking

for the majority opinion observed (para 33, p 576):

"The court will interpret a statute as far as

possible, agreeably to justice and reason and that

in case of two or more interpretations, one which

is more reasonable and just will be adopted, for

there is always a presumption against the law

maker intending injustice and unreason. The

court will avoid imputing to the Legislature an

intention to enact a provision which flouts

167

notions of justice and norms of fairplay, unless a

contrary intention is manifest from words plain

and unambiguous. A provision in a statute will

not be construed to defeat its manifest purpose

and general values which animate its structure.

In an avowedly democratic polity, statutory

provisions ensuring the security of fundamental

human rights including the right to property will,

unless the contrary mandate be precise and

unqualified, be construed liberally so as to

uphold the right. These rules apply to the

interpretation of constitution and statutory

provisions alike."

72. On the above premise, taking over a possession of land

without complying with the requirement of section

17(3A) is clearly illegal and in clear violation of the

statutory provision which automatically violates the

constitutional guarantee under Article 300A. A passing

observation to the contrary in S.P. Jain (supra) must

pass sub silentio being unnecessary in the facts of the

case as otherwise such a finding is per incuriam, being

in violation of the statute. A fortiorari the said finding

cannot be sustained as a binding precedent.

73. For the reason aforesaid, this Court holds that the writ

petition cannot be dismissed in view of the decision in

S.P. Jain (supra) which was decided on totally

168

different facts. The judgment of the High Court is set

aside.

74. This court further holds that in all cases of emergency

acquisition under section 17, the requirement of

payment under section 17(3A) must be complied with.

As the provision of section 17(1) and section 17(2)

cannot be worked out without complying with

requirement of payment under section 17(3A) which is

in the nature of condition precedent. If section 17(3A)

is not complied with, the vesting under section 17(1)

and section 17(2) cannot take place. Therefore,

emergency acquisition without complying with section

17(3A) is illegal. This is the plain intention of the

statute which must be strictly construed. Any other

construction, in my opinion, would lead to diluting the

Rule of Law.

75. However, coming to the question of relief in the instant

case, the Court has to take note of the fact situation.

Admittedly, possession of the land has been taken and

same has been handed over to the beneficiary on

169

which construction had taken place and third party

interests had arisen. It is very difficult to put the

hands of the clock back now, despite the aforesaid

declaration of law by the Court. This Court, therefore,

has to think in terms of adequately compensating the

appellants. In the special facts of this case,

compensation in respect of the land acquired insofar

as the appellants are concerned cannot be decided on

the basis of the date of notice under Section 4.

76. In view of the discussions above, the compensation

has to be fixed with regard to the value of the

appellant's land as on the date of filing of the writ

petition which was in March, 2006 before the High

Court. The section 4 notification must be deemed to

have been issued on March 1, 2006 and the

compensation must be worked out on that basis. An

award on that basis must be passed by the Collector

within four months from date and the appellants are

given liberty, if so advised, to challenge the same in

appropriate proceedings. All questions relating to

compensation in aforesaid proceeding are kept open

170

for both the parties. As the respondent - the acquiring

authority has proceeded illegally in the matter, it must

pay costs of Rupees one lakh in favour of Allahabad

High Court Mediation Centre within a period of six

weeks from date. The State is at liberty to recover the

same from the erring officials.

77. The appeal is, thus, allowed with costs as aforesaid.

.............................................J.

[Asok Kumar Ganguly]

New Delhi

August 18, 2011

171

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.24 OF 2009

M/s. Delhi Airtech Services

Pvt. Ltd. & Anr. ... Appellants

Versus

State of U.P. & Anr. ... Respondents

O R D E R

In view of the divergence of opinion on conclusions and also on

various legal questions discussed in two separate judgments by us, the

matter is required to be placed before the Hon'ble the Chief Justice of

India for reference to a larger Bench to resolve the divergent views

expressed in both the judgments and to answer the questions of law

framed.

.............................................J.

[Asok Kumar Ganguly]

.............................................J.

[Swatanter Kumar]

New Delhi

August 18, 2011

172

***