M/S Kamal Trading P.Ltd vs State Of West Bengal & Ors

& ORS. ... RESPONDENTS

JUDGMENT

(SMT.) RANJANA PRAKASH DESAI, J.

1. Leave granted.

2. This appeal, by grant of special leave, is directed

against the judgment and order dated 19/8/2009 passed by

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the High Court at Calcutta dismissing the appeal filed by the

appellant.

3. The appellant, which is a private limited company was

entrusted by seventeen joint owners of the premises known

as "Industry House" at No.10, Camac Street, Calcutta - 700

017 (for short, "the said premises"), to look after the day-

to-day management and maintenance of the said premises

as also to initiate proceedings for and on their behalf. The

seventeen joint owners include respondents 6, 7 and 8

herein and one Pilani Investment (hereinafter referred to as

"owner companies" for convenience). They are seized and

possessed of certain floors of the said premises. The State

of West Bengal requisitioned the said floors under the

provisions of the West Bengal Premises Requisition and

Control (Temporary Provision) Act, 1947 (for short, "the

1947 Act"). Under the 1947 Act, the maximum period of

requisition was fixed at 25 years from the date of initial

order of requisition and the State Government was obliged

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to release the property under requisition after expiry of 25

years. It is the case of the appellant that, in fact, the

release of the said floors was in contemplation of the

concerned authorities. However, enquiries made by the

appellant revealed that the State Government was planning

to acquire the said premises in exercise of its powers under

the Land Acquisition Act, 1894 (for short, "the LA Act").

The appellant along with owner companies, therefore, filed

Writ Petition No.22859 (W) of 1997 praying for a writ of

mandamus directing the State to release the said floors from

requisition.

4. Instead of releasing the said floors from requisition, the

State Government issued a notification dated 29/7/1997

under Section 4 of the LA Act stating, inter alia, that the said

floors are needed for the public purpose viz. for permanent

office accommodation of Public Works Department. The said

notification was published in the Government Gazette on

12/8/1997. It is the case of the appellant that the owner

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companies raised objections vide letter dated 8/9/1997

under Section 5A of the LA Act. The Second Land

Acquisition Officer issued notice dated 23/9/1997 fixing date

of hearing of the objections on 26/9/1997. On receipt of the

said notice, the representative of the appellant met the

Second Land Acquisition Collector on 25/9/1997 and by

letter of even date, requested that the hearing fixed on

26/9/1997 be postponed till after 29/9/1997 because the

Constituted Attorney of the appellant was held up in Mumbai

and was unable to attend the hearing. The Second Land

Acquisition Collector issued another notice dated 26/9/1997

fixing the date of hearing of the objections on 30/9/1997.

By letter dated 29/9/1997, the appellant again requested for

adjournment till after 28/10/1997 on the ground that its

Constituted Attorney was unable to attend and the advocate

was out of station. According to the appellant, while they

were waiting for further communication about the date of

hearing, the State Government issued a declaration dated

24/10/1997 under Section 6 of the LA Act, which was

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published in the Gazette on 29/10/1997. In the said

declaration, it was stated that the Government was satisfied

that the said floors were needed for the public purpose. The

Special Land Acquisition Officer did not accept the

appellant's request for further adjournment and proceeded

to submit report dated 30/9/1997.

5. The appellants along with the owner companies filed

Writ Petition No.25632(W) of 1997 and prayed for quashing

notifications dated 29/7/1997. One of the grounds taken by

them was that the report submitted by the Second Land

Acquisition Officer was vitiated due to violation of the rule of

hearing enshrined in Section 5A(2) of the LA Act and non

application of mind by the concerned officer to the

objections filed under Section 5A(1) of the LA Act.

6. By an order dated 3/12/2003, the learned Single Judge

dismissed both the writ petitions. FMA No.40 of 2004 filed

by the appellant against dismissal of Writ Petition

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No.25632(W) of 1997 was dismissed by the Division Bench.

Hence, this appeal by special leave.

7. We have heard Dr. Singhvi, learned senior counsel

appearing for the appellant and Mr. Chaudhari, learned

senior counsel appearing for the contesting respondents, at

some length. Though several points are raised in this

appeal, Dr. Singhvi addressed us on violation of Section 5A

of the LA Act as according to him, this point goes to the root

of the matter.

8. Dr. Singhvi submitted that hearing contemplated under

Section 5A of the LA Act is not an empty formality. He

submitted that the said right has been raised to the level of

a fundamental right by this Court. Learned senior counsel

argued that the acquisition of the land is a serious matter

and when the State decides to deprive a person of his

property by taking recourse to LA Act, it is bound to afford

him an opportunity to file objections under Section 5A(1) of

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the LA Act and of being heard by the Collector in terms of

Section 5A(2) of the LA Act. Learned senior counsel then

submitted that the Second Land Acquisition Officer wrongly

rejected the genuine prayer made by the appellant vide

letter 29/9/1997 for adjournment on the ground that the

counsel was out of station. He argued that even if the

concerned officer was not inclined to adjourn the case, he

was duty bound to consider the objections raised by the

appellant with necessary seriousness and decide the same

by assigning reasons. Dr. Singhvi submitted that although

the report of the Second Land Acquisition Officer makes a

mention of the objections raised by the appellant, but the

same have not at all been dealt with and, thus, the report

made by the Second Land Acquisition Officer, which

contained recommendations for the acquisition of land

suffers from the vice of non application of mind. In support

of his submissions, Dr. Singhvi relied upon the judgments of

this Court in U nion of India v. Mukesh Hans1 ,

1 (2004) 8 SCC 14

8

Hindustan Petroleum Corporation Ltd. v. Darius

Shapu r Chenai & Ors.2 , Dev Saran v. State of Uttar

Pr adesh3 , R adhy Shyam V. State of Uttar Pradesh4 .

9. Mr. Chaudhary, learned senior counsel for the

respondents argued that the Second Land Acquisition Officer

did not commit any illegality by declining the appellant's

request for adjournment because the sole object of such

request was to delay finalization of the acquisition

proceedings. Learned senior counsel emphasized that if the

counsel for the appellant was not available on 30/9/1997,

i.e., the date to which the hearing was adjourned by the

Second Land Acquisition Officer, the appellant should have

made alternative arrangement and the concerned officer did

not commit any error by declining the repeated request for

adjournment made on its behalf. Mr. Chaudhary then

submitted that the report submitted by the Special Land

Acquisition Officer does not suffer from the vice of non

2 (2005) 7 SCC 627

3 (2011) 4 SCC 769

4 (2011) 5 SCC 553

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application of mind because he had duly considered the

objections raised by the appellant. In support of his

argument, he relied upon the judgment of this Court in

Jayabheri Properties Private Limited & Ors. v. State

of Andhra Pradesh & Ors.5 where according to him, a

similar contention raised by the appellants therein was

rejected on the ground that adequate opportunity had been

given to the appellants to voice their objections and the

objections were duly considered by the Special Deputy

Collector. Counsel submitted that in the circumstances, the

appeal may be dismissed.

10. Section 5A(1) of the LA Act gives a right to any person

interested in any land which has been notified under Section

4(1) as being needed or likely to be needed for a public

purpose to raise objections to the acquisition of the said

land. Sub-section (2) of Section 5A requires the Collector to

give the objector an opportunity of being heard in person or

by any person authorized by him in this behalf. After

5 (2010) 5 SCC 590

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hearing the objections, the Collector can, if he thinks it

necessary, make further inquiry. Thereafter, he has to

make a report to the appropriate Government containing his

recommendations on the objections together with the record

of the proceedings held by him for the decision of the

appropriate Government and the decision of the appropriate

Government on the objections shall be final. It must be

borne in mind that the proceedings under the LA Act are

based on the principle of eminent domain and Section 5A is

the only protection available to a person whose lands are

sought to be acquired. It is a minimal safeguard afforded to

him by law to protect himself from arbitrary acquisition by

pointing out to the concerned authority, inter alia, that the

important ingredient namely `public purpose' is absent in the

proposed acquisition or the acquisition is mala fide. The LA

Act being an ex-proprietary legislation, its provisions will

have to be strictly construed.

11. Hearing contemplated under Section 5A(2) is necessary

to enable the Collector to deal effectively with the objections

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raised against the proposed acquisition and make a report.

The report of the Collector referred to in this provision is not

an empty formality because it is required to be placed before

the appropriate Government together with the Collector's

recommendations and the record of the case. It is only

upon receipt of the said report that the Government can

take a final decision on the objections. It is pertinent to note

that declaration under Section 6 has to be made only after

the appropriate Government is satisfied on the consideration

of the report, if any, made by the Collector under Section

5A(2). As said by this Court in Hindustan Petroleum

Limited, the appropriate Government while issuing

declaration under Section 6 of the LA Act is required to apply

its mind not only to the objections filed by the owner of the

land in question, but also to the report which is submitted by

the Collector upon making such further inquiry thereon as he

thinks necessary and also the recommendations made by

him in that behalf. Sub-section (3) of Section 6 of the LA

Act makes a declaration under Section 6 conclusive evidence

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that the land is needed for a public purpose. Formation of

opinion by the appropriate Government as regards the public

purpose must be preceded by application of mind as regards

consideration of relevant factors and rejection of irrelevant

ones. It is, therefore, that the hearing contemplated under

Section 5A and the report made by the Land Acquisition

Officer and his recommendations assume importance. It is

implicit in this provision that before making declaration

under Section 6 of the LA Act, the State Government must

have the benefit of a report containing recommendations of

the Collector submitted under Section 5A(2) of the LA Act.

The recommendations must indicate objective application of

mind.

12. We may make a brief reference to the judgments on

which reliance has been placed by Dr. Singhvi, which

support the view taken by us.

1 13. In M unshi Singh v. Union of India6 , this Court while

dealing with Section 5A of the LA Act observed as under :

"7. Section 5-A embodies a very just and

wholesome principle that a person whose

property is being or is intended to be

acquired should have a proper and

reasonable opportunity of persuading the

authorities concerned that acquisition of the

property belonging to that person should not

be made. ... The legislature has, therefore,

made complete provisions for the persons

interested to file objections against the

proposed acquisition and for the disposal of

their objections. It is only in cases of

urgency that special powers have been

conferred on the appropriate Government to

dispense with the provisions of Section 5-A."

14. In Om Pr akash v. State of Uttar Pradesh7 , referring

to its earlier judgment in State of Punjab v. Gurdial

Singh 8 , this Court raised the right under Section 5A of the

LA Act to the level of fundamental right and observed that

inquiry under Section 5A is not merely statutory but also has

a flavour of fundamental rights under Articles 14 and 19 of

6 (1973) 2 SCC 337

7 (1998) 6 SCC 1

8 (1980) 2 SCC 471

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the Constitution though right to property has now no longer

remained a fundamental right, at least, observation

regarding Article 14 vis-`-vis Section 5A of the LA Act would

remain apposite.

15. In Mukesh Hans, this Court reiterated that right of

representation and hearing contemplated under Section 5A

is a very valuable right of a person whose property is sought

to be acquired and he should have appropriate and

reasonable opportunity of persuading the concerned

authorities that the acquisition of the property belonging to

that person should not be made. This court further held that

the right given to an owner/person interested under Section

5A to object to the acquisition proceedings is not an empty

formality and is a substantive right which can be taken away

for good and valid reason and within the limitations

prescribed under Section 17(4) of the LA Act.

1 16. In Hindustan Petroleum Corporation, this Court

again referred to Om Prakash and observed that it is trite

that hearing given to a person must be an effective one and

not a mere formality. This Court observed that formation of

opinion as regards the public purpose as also suitability

thereof must be preceded by application of mind as regards

consideration of relevant factors and rejection of irrelevant

ones. This Court further observed that the State in its

decision-making process must not commit any misdirection

in law. This Court observed that it cannot be disputed that

Section 5A of the LA Act confers a valuable important right

and having regard to the provisions contained in Article 300-

A of the Constitution, it has been held to be akin to a

fundamental right. Pertinently, this Court made it clear that

in a case where there has been total non-compliance or

substantial non-compliance with the provisions of Section 5A

of the LA Act, the Court cannot fold its hands and refuse to

grant relief to the appellant. Again in Dev Saran, this Court

reiterated the same view.

1 17. In Radhy Shyam, this Court was considering a case

where the State had invoked urgency clause under Section

17(4) and dispensed with inquiry under Section 5A. This

Court observed that the legislation which provides for

compulsory acquisition of the private property by the State

falls in the category of ex-propriatory legislation and such

legislation must be construed strictly. The property of a

citizen cannot be acquired by the State without complying

with the mandate of Sections, 4, 5A and 6 of the LA Act.

18. The decision of this Court in Jayabheri on which

counsel for the respondent has placed reliance does not take

any contrary view. The Court had adverted to the facts of

that case and concluded that there was no violation of

Section 5A of the LA Act.

1 19. According to the appellant, notification under Section 4

of the LA Act was not served on owner companies.

However, upon coming to know of this notification, the

appellant vide their letter dated 8/9/1997 submitted

objections running into four pages containing 8 paragraphs.

We have already noted that the Second Land Acquisition

Officer adjourned the hearing on one occasion as requested

by the appellant. He, however, refused to adjourn the

matter any further. The second request was rejected. We

feel that looking to the nature of the issues involved, the

Second Land Acquisition Officer could have adjourned the

proceedings after putting the appellant to terms because

hearing the representative of the owner companies was

mandatory. In any event, if he did not want to adjourn the

proceedings and wanted to consider the objections in the

absence of counsel for the owner companies and assuming

such a course is permissible in law, he should have dealt

with the objections carefully and not in such a lighthearted

manner because heavy responsibility rested on his

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shoulders. In the report, he has noted the objections as

under:

"(i) Notification U/S 4 has not been published

in the Newspapers nor publicly notified.

(ii) Premise is under requisition under the W

Bengal Premises Requisition & Control

(Temporary Provisions) Act, 1947 from

16/09/72 and is about to complete 25

years on 15/09/97 when as per the Law

release of the premises is expected.

(iii) Anticipating impending release, tie-up has

been made to accommodate foreign

ventures/industrialists.

(iv) LA Collector has shown colourful authority by extending this acquisition proceeding."

20. He has then noted that the officers of the Acquiring

Body vehemently protested against the statements made in

the appellant's letter and stated that the said statements are

false, arbitrary and groundless and they simply endeavour to

oust the Acquiring Body by hook or by crook. The

paragraphs which contain the submissions and the so-called

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reasons of the Second Land Acquisition Officer need to be

quoted.

"Heard the officers present from the

Requiring Body. They vehemently

protested as regards the statements

contained in this particular letter. Their

submissions in short that the statements

made by the interested persons are all fake,

arbitrary and groundless. They simply

endeavour to oust the Requiring Body by

hook or crook in order to grab this office

space so that in turn can realize higher

rent. Further, the purpose of the Requiring

Body is very much public oriented and if it

is no acquired they will suffer immensely.

They further submitted that acquisition

proceeding to be completed as quickly as

possible inasmuch as they have the time

bound programmes to implement it as per

guidelines of Government for the greater

interest of public.

In view of these circumstances and for

greater interest of the public, the

submissions made by the interested

persons by their letter dated 8/9/1997 are

overruled."

21. By no stretch of imagination, it can be said that the

Second Land Acquisition Officer had applied his mind to the

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objections raised by the appellant. The above-quoted

paragraphs are bereft of any recommendations. The Second

Land Acquisition Officer has only reproduced the contentions

of the officers of the Acquiring Body. The objections taken

by the appellants are rejected on a very vague ground.

Mere use of the words `for the greater interest of public'

does not lend the report the character of a report made after

application of mind. Though in our opinion, the declaration

under Section 6 of the LA Act must be set aside because the

appellant was not given hearing as contemplated under

Section 5A(2) of the LA Act, which is the appellant's

substantive right, we must record that in the facts of this

case, we are totally dissatisfied with the report submitted by

the Second Land Acquisition Officer. His report is utterly

laconic and bereft of any recommendations. He was not

expected to write a detailed report but, his report, however

brief, should have reflected application of mind. Needless to

say that as to which report made under Section 5A(2) could

be said to be a report disclosing application of mind will

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depend on the facts and circumstances of each case.

22. Having examined this case, in the light of the law laid

down by this Court, we are of the opinion that the High

Court wrongly rejected the prayer made by the appellant

that the notification under Section 4 and declaration under

Section 6 of the LA Act be quashed and set aside. The

impugned judgment and order of the High Court, therefore,

needs to be set aside and is, accordingly, set aside. Since

no hearing was given to the appellant resulting in non

compliance of Section 5A of the LA Act, the declaration

under Section 6 of the LA Act dated 24/10/1997 published in

the Government Gazette on 29/10/1997 must be set aside

and is set aside. In view of the judgment of the Constitution

Bench of this Court in Padma Sundara Rao (Dead) & Ors

v.

State of T.N. & Ors9 , the State Government cannot now

rely upon notification dated 29/7/1997 for the purposes of

issuing fresh declaration under Section 6(1) of the LA Act.

The said notification dated 29/7/1997 issued under Section

9 (2002) 3 SCC 533

2

4 is also, therefore, set aside. It would be, however, open

to the State Government to initiate fresh land acquisition

proceedings in accordance with law if it so desires.

23. We make it clear that nothing said by us in this

judgment should be treated as expression of our opinion on

the merits of the case of either side.

24. The appeal is disposed of in the aforestated terms.

.....................................................J.

(G.S. SINGHVI)

.....................................................J.

(RANJANA PRAKASH DESAI)

NEW DELHI,

DECEMBER 13, 2011.