Ramji Veerji Patel & Ors vs Revenue Divisional Officer & Ors

Ramji Veerji Patel & Ors. .... Appellants

Versus

Revenue Divisional Officer & Ors. ....Respondents

JUDGMENT

R.M. Lodha, J.

The appellants were unsuccessful in challenging the

acquisition of their land before the Single Judge as well as the

Division Bench of the Madras High Court. They are in appeal, by

special leave.

2. On the requisition of Cholan Roadways Corporation

Limited, Kumbakonam (for short, `the Corporation') for making

available land for expansion of their depot, particularly for a

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workshop, at Chidambaram, the State Government of Tamil Nadu (for

short, `the Government') issued a notification under Section 4(1) of

the Land Acquisition Act, 1894 (for short, `the Act') which was

published in the Gazette on March 3, 1989 notifying for general

information that the land mentioned therein, namely, land

admeasuring 1.45 acres comprised in T.S. No. 14, classified as

government wet land in Chidambaram Municipal Town, South Arcot

District was needed for the above public purpose. The notification

under Section 4(1) was also published in the two newspapers on

November 18, 1988 and in the locality on March 27, 1989. The

appellants filed objections to the acquisition before the Revenue

Divisional Officer (for short, `RDO'), Chidambaram. The diverse

objections to the acquisition were raised; one of such objections

being that the other lands behind the existing depot of the

Corporation were available and could be used for the purpose for

which their land was sought to be acquired. They stated that their

family was dependant upon the income from the saw mill existing on

the land and by compulsory acquisition of their land, they would be

deprived of the sole means of livelihood.

2 3. The RDO considered the objections put forth on behalf of

the appellants and submitted his report to the Government on

conclusion of the enquiry under Section 5-A of the Act.

4. It appears that when the report of the RDO was under

consideration, the appellants sent a representation to the

Government bringing to its notice that the land belonging to Tamil

Nadu Evengelical Lutheran Church (`TELC') just behind the existing

depot has been advertised for sale and, therefore, instead of

resorting to the compulsory acquisition of the appellants' land, the

land of TELC may be acquired.

5. The Government was not persuaded by the appellants'

objections and the declaration under Section 6 of the Act was issued

which was published in the Gazette on March 21, 1990. The

publication of the Section 6 declaration was made by other modes as

well.

6. The appellants challenged the notification under Section

4(1) and declaration under Section 6 of the Act in the writ petition

before the Madras High Court. In opposition to the writ petition,

counter affidavit was filed on behalf of the Government. The learned

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Single Judge of the High Court dismissed the writ petition by his order

dated November 18, 1998.

7. Against the order of the Single Judge, the appellants

preferred intra-court appeal which has been dismissed by the

impugned order on July 25, 2001.

8. Mr. Pallav Shishodia, learned senior counsel for the

appellants raised two-fold contention. His first contention was that the

appellants' objections about the availability of land belonging to TELC

which is situated behind the existing depot of the Corporation and

was available for sale were not rationally considered by the RDO and

the Government. He submitted that the livelihood of about 40

members of the family was directly affected by the compulsory

acquisition of their land and, therefore, the objections ought to have

been considered in a reasonable manner more so since the public

purpose for which the appellants' land was sought to be acquired

could have been easily met by the acquisition of the TELC's land. In

this regard, he referred to three decisions of this Court, namely, (i)

Delhi Administration v. Gurdip Singh Uban and Others1, (ii) Hindustan

Petroleum Corpn. Ltd. v. Darius Shapur Chenai and others2 and (iii)

1 (2000) 7 SCC 296

2 (2005) 7 SCC 627

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Radhy Shyam (Dead) Through LRs. and others v. State of Uttar

Pradesh and Others3.

9. The second contention of the learned senior counsel for

the appellants was that the acquisition of the appellants' land by the

Government was for the purposes of the Corporation and the

Corporation being a `company' for the purposes of the Act, the

procedure contemplated in Part VII of the Act was required to be

mandatorily followed and since the said procedure has not been

followed, the acquisition is bad in law. In this regard, Mr. Pallav

Shishodia placed reliance upon a decision of this Court in State of

Punjab and Others v. Raja Ram and others4.

10. On the other hand, Mr. B. Balaji, learned counsel for the

State of Tamil Nadu supported the view taken by the Single Judge

and the Division Bench of the High Court. He submitted that the

proceedings for acquisition of the appellants' land have been initiated

and concluded in accordance with the procedure prescribed in the

Act. There is no illegality in the acquisition of the appellants' land. He

referred to the counter affidavit filed on behalf of the Government

before the High Court in opposition to the writ petition.

3 (2011) 5 SCC 553

4 (1981) 2 SCC 66

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11. The Act was enacted in 1894 for the acquisition of land

needed for public purposes and for companies and for determining

the amount of compensation to be made on such acquisition. The Act

has undergone some amendments in 1919, 1921, 1923, 1933, 1962,

1967 and 1984; the last major amendments being by the Land

Acquisition (Amendment) Act, 1984 (Act 68 of 1984).

12. The provisions contained in the Act, of late, have been felt

by all concerned, do not adequately protect the interest of the land

owners/persons interested in the land. The Act does not provide for

rehabilitation of persons displaced from their land although by such

compulsory acquisition, their livelihood gets affected. For years, the

acquired land remains unused and unutilised. To say the least, the

Act has become outdated and needs to be replaced at the earliest by

fair, reasonable and rational enactment in tune with the constitutional

provisions, particularly, Article 300A of the Constitution. We expect

the law making process for a comprehensive enactment with regard

to acquisition of land being completed without any unnecessary

delay.

13. Reverting back to the Act, that Section 5-A of the Act

confers a valuable right on the person interested in any land which

has been notified under Section 4(1) as being needed for a public

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purpose or likely to be needed for public purpose is beyond doubt. By

this right, the owner/person interested may put forth his objections not

only in respect of public purpose but also the suitability of the

acquisition in respect of his land. The objector gets an opportunity

under Section 5-A to persuade the Collector that his land is not

suitable for the purpose for which the acquisition is being made or the

availability of other land suitable for that purpose. Section 5-A

proceedings are two-tier proceedings. In the first step, the objections

by the owner/person interested are heard by the Collector and a

report is submitted to the Government. In the second step, the final

decision is taken by the Government on the objections so furnished

by the person interested and the consideration of the report submitted

by the Collector.

14. In Munshi Singh and others v. Union of India5, in

paragraph 7 of the Report, this Court stated as follows :

"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

5 (1973) 2 SCC 337

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conferred on the appropriate Government to dispense

with the provisions of Section 5-A: "

15. The above legal position has been reiterated by this Court

in various decisions including the decisions of this Court in Hindustan

Petroleum Corpn. Ltd.2 and Radhy Shyam3 cited by Mr. Pallav

Shishodia. In Hindustan Petroleum Corpn. Ltd.2 , this Court in

paragaraph 6 of the Report stated thus :

"6. It is not in dispute that Section 5-A of the Act confers a

valuable right in favour of a person whose lands are sought

to be acquired. Having regard to the provisions contained

in Article 300-A of the Constitution, the State in exercise of

its power of "eminent domain" may interfere with the right

of property of a person by acquiring the same but the same

must be for a public purpose and reasonable compensation

therefor must be paid."

16. In Union of India v. Mukesh Hans6, this Court referred to

Munshi Singh5 and in paragraph 35 of the Report stated that the

limited right given to the owner/person interested under Section 5-A

of the Act to object to the acquisition proceedings is not an empty

formality and is a substantive right.

17. As a matter of law, under the Act, the only right that the

owner/person interested has, is to submit objections to the

compulsory acquisition of his land under Section 5-A. No question,

such right and the consideration of objections filed by the land-

6 (2004) 8 SCC 14

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owner/person interested in exercise of such right must be given the

importance it deserves. The question before us, is whether the

consideration of the appellants' objections to the acquisition of their

land by the Government suffers from any illegality or irrationality.

18. The appellants and their family members purchased the

subject land admeasuring 1.45 acres on January 27, 1981. The said

land was agricultural at the time of purchase and was depressed in

as much as it was low in level than the main road. The appellants

incurred expenditure in raising the level of the land and made

improvements; raised the building thereon and installed a saw mill

somewhere in 1986. In their objections filed on May 24, 1989 before

the RDO, the facts concerning the expenditure incurred by them for

converting the agricultural land into building site; the deprivation of

their sole means of livelihood and the availability of other lands were

stated. The objectors also stated that the workshop of Thanthai

Periyar Transport Corporation was originally put up in Anna

Kalayarangam land owned by the Municipality. Later, they had

purchased four acres of land comprised in T.S. Nos. 133 and 151 at

Lal Puram main road, and constructed a workshop and that workshop

was functioning. The Corporation, the objectors submitted, can

acquire any extent of land next to them to construct a workshop.

9 19. The RDO considered the above objections raised by the

appellants and in the proceedings drawn on September 14, 1989

overruled the same. The RDO held that when the requisitioning

authority approached TELC for making available their land, the TELC

refused to sell the said land and informed them that they required

their land for their religious purposes. The RDO, in this backdrop,

observed that TELC's land cannot be acquired for the purpose of

expansion of depot. As regards the availability of lands near Thanthai

Periyar Transport Corporation, the RDO observed that these lands

were one kilometre away from the Corporation's depot and, thus, the

land of the appellants alone was suitable for the expansion of depot.

The RDO, accordingly, forwarded its report to the Government.

20. On October 26, 1989, TELC issued a public notice in a

daily newspaper `Dina Malhar' for sale of its land referred to above.

The appellants sent the copy of the said notice to the Government.

However, the Government was not persuaded to accept the

landowners' objections and on consideration of the RDO's report

proceeded with the issuance and publication of declaration under

Section 6 of the Act.

21. Mr. Pallav Shishodia, learned senior counsel for the

appellants vehemently contended that the land belonging to the

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TELC is suitable as that land is situated just behind the existing

depot; the existing depot has already access to the main road from

Chidambaram to Cuddalore and on acquisition of the land of TELC,

the acquired land too would have access to the main road through

the existing depot of the Corporation. He, thus, submitted that

suitability aspect has not at all been rationally considered by the

Government.

22. It is difficult to accept the contention of the learned senior

counsel for more than one reason. In the first place, in paragraph 5 of

the counter affidavit filed by the Government before the High Court,

inter alia, following averment was made:

".......The land acquired exists adjacent to the existing

depot and it has easy access to the main road from

Chidambaram to Cuddalore and it is found to be more

suitable in all aspects for the expansion of the

depot.........."

The above averment remains unrebutted and unchallenged by the

appellants as no rejoinder was filed.

23. Secondly, if the land proposed to be acquired and the

alternative land suggested by the owners/persons interested are

equally suitable for the purpose for which land is being acquired, the

satisfaction of the Government, if not actuated with ulterior motive,

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must get primacy. In the judicial review, it is not open to the court to

examine the aspect of suitability as a court of appeal and substitute

its opinion. In any case the present case is not a case where the

other lands suggested by the appellants have been found to be

equally suitable. The Government has given reasons as to why the

appellants' land has been found to be more suitable for expansion of

the depot. The appellants' land is adjacent to the existing depot of

the Corporation having easy access to the main road. In our view,

the manner in which the decision has been taken by the Government

regarding suitability of the appellants' land for expansion of the depot

of the Corporation is not vitiated by any error of law nor it is irrational

or founded on the extraneous reasons.

24. Third and more important, at the insistence of the

learned senior counsel for the appellants, we considered the site

plan referred to by him and from a perusal thereof no doubt is left that

the land of the appellants is more suitable than the land of TELC

situate behind the existing depot. TELC land has no direct access

from the Chidambaram to Cuddalore main road. It has access from a

different side road passing adjacent to the canal. The size of the

TELC's land is also awkward; it is a long piece of land of which width

narrows down from 175 feet to 56 feet west to east. On the other

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hand, the appellants' land is adjacent on the southern side to the

existing depot and has access from the Chidambaram to Cuddalore

main road. Having regard to the purpose for which the land is sought

to be acquired, namely, expansion of existing depot, particularly, for a

workshop, the appellants' land is definitely more suitable. Pertinently,

in their objections, the appellants have not challenged the public

purpose for the acquisition of their land. In what we have indicated

above, it cannot be said that suitability aspect has not been

reasonably or rationally considered by the Government.

25. Then comes the second contention of Mr. Pallav

Shishodia. He relied upon the decision of this Court in the case of

Raja Ram4 and submitted that the erstwhile Corporation or the

successor Tamil Nadu State Transport Corporation (TNSTC) is a

`government company' for the purposes of the Act and, therefore,

compliance with the provisions of Part VII of the Act had to be made

in order to lawfully acquire any land for its purpose. In this regard, he

referred to the averment made in the reply to I.A. No. 3 of 2003 that

TNSTC was the beneficiary of the acquisition; it is they who have

remitted the extent of compensation quantified by the authorities

under the land acquisition.

13 26. With regard to the above contention of Mr. Pallav

Shishodia, it is enough to say that it overlooks Section 3(cc) and

Section 3(e) of the Act, substituted by Act 68 of 1984. The definition

of `company' in Section 3(e) after substitution in 1984 is as follows:

"S.3(e).- the expression "company" means--

(i) a company as defined in section 3 of the

Companies Act, 1956 (1 of 1956), other than a

Government company referred to in clause (cc);

(ii) A society registered under the Societies

Registration Act, 1860 (21 of 1860), or under

any corresponding law for the time being in

force in a State, other than a society referred to

in clause (cc);

(iii) A co-operative society within the meaning of

any law relating to co-operative societies for the

time being in force in any State, other than a

co-operative society referred to in clause (cc)".

Section 3(cc) of the Act defines the expression "corporation owned or

controlled by the State" as follows :

"S.3(cc).- the expression "corporation owned or

controlled by the State" means any body corporate

established by or under a Central, Provincial or State Act,

and includes a Government company as defined in section

617 of the Companies Act, 1956 (1 of 1956), a society

registered under the Societies Registration Act, 1860 (21 of

1860), or under any corresponding law for the time being in

force in a State, being a society established or

administered by Government and a co-operative society

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within the meaning of any law relating to co-operative

societies for the time being in force in any State, being a

co-operative society in which not less than fifty-one per

centum of the paid-up share capital is held by the Central

Government, or by any State Government or Governments

or partly by the Central Government and partly by one or

more State Governments;"

27. That Corporation and the TNSTC fall within the definition

of Section 3(cc) is not in dispute. Both may not have been divested of

their character as a government company but sub-clause (i) of

Section 3(e) excludes a government company from the definition of

company. Part VII (Sections 38 to 44B) of the Act provides for

acquisition of land for companies. In view of the definition of the

`company' in Section 3(e) which excludes government company, the

Corporation or for that matter its successor TNSTC does not fall

within the definition of the `company' and, therefore, is not covered by

Part VII of the Act at all.

28. In Raja Ram4, the definition of `company' in Section 3 (e)

of the Act prior to its substitution fell for consideration. The definition

of `company' under consideration read as follows :

"the expression "company" means a company registered

under the Indian Companies Act, 1890 or under the

(English) Companies Acts, 1862 to 1882 or incorporated by

an Act of Parliament of the United Kingdom or by an Indian

law, or by Royal Charter or Letters Patent and includes a

society registered under the Societies Registration Act,

1860, an a registered society within the meaning of the

Cooperative Societies Act, 1912, or any other law relating

15

to cooperative societies for the time being in force in any

State."

29. It was in the context of the above definition that this Court

held in Raj Ram4 that the Food Corporation of India was not divested

of its character as a company within the meaning of definition of

clause (e) of Section 3 of the Act. As noticed above, the definition of

`company' has undergone complete change and the government

company has been expressly excluded from the expression

`company' for the purposes of the Act.

30. For the above reasons, it has to be held that Part VII of

the Act has no application to the present case as the acquisition of

land is not for a `company' as defined in Section 3(e).

31. Mr. Pallav Shishodia, learned senior counsel also urged

that the appellants are migrants from Gujarat. They have settled in

Chidambaram about thirty years back and the livelihood of the entire

family of the appellants which comprised of about 40 members is

dependant on the saw mill existing on the subject land. Having

regard to these facts, he would submit that we invoke our jurisdiction

under Article 142 of the Constitution and declare the acquisition of the

appellants' land bad in law to do complete justice. There is no doubt

that by compulsory acquisition of their land, the appellants have

16

been put to hardship. As a matter of fact, the RDO was alive to this

problem. In his report dated September 14, 1989, the RDO did

observe that the land owners have spent considerable money to raise

the level of the land for constructing compound wall and running saw

mill. He was, however, of the opinion that the appellants' land was

very suitable for the expansion of the depot and the suitable

compensation can be paid to the land-owners to enable them to

purchase an alternative land. The appellants, however, proceeded to

challenge the acquisition. The litigation has traversed upto this Court

and taken about 22 years. The public purpose has been stalled for

more than two decades. Being the Highest Court, an extraordinary

power has been conferred on this Court under Article 142 to pass any

decree, order or direction in the matter to do complete justice

between the parties. The power is plenary in nature and not inhibited

by constraints or limitations. However, the power under Article 142 is

not exercised routinely. It is rather exercised sparingly and very

rarely. In the name of justice to the appellants, under Article 142,

nothing should be done that would result in frustrating the

acquisition of land which has been completed long back by following

the procedure under the Act and after giving full opportunity to the

appellants under Section 5-A. The possession of the land has also

17

been taken as far back as on July 25, 2001. The appellants made

an application (I.A. No. 2 of 2002) for direction to the respondents not

to interfere with the functioning of the saw mill and permit them to use

the saw mill but this Court in its order dated May 8, 2002 only said

that the saw mill shall not be demolished till further orders. No

permission was granted to the appellants to use the saw mill. In other

words, for more than ten years the saw mill is closed after

possession was taken over from the appellants. In the circumstances,

this is not a case fit for exercise of power under Article 142 and

declare the acquisition of the appellants' land bad although the

acquisition proceedings have been completed in accordance with

law.

32. Lastly, the learned senior counsel invited our attention to

the application (I.A. No. 4) wherein the appellants offered for

amicable settlement by expressing their readiness and willingness to

give an area of land admeasuring 13250 square feet out of the total

land of 1.45 acres (i.e. 1 acre and 19445 sq. ft.) free of cost to the

Corporation. The offer is not acceptable to Mr. B. Balaji. He submitted

that such a small area is of no use for expansion of the existing

depot. We do not find any unreasonableness in the submission of

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the counsel that an area of 13250 square feet would not meet the

purpose for which the appellants' land has been acquired.

33. In view of the above, there is no merit in the appeal and it

is dismissed. I.A. No. 4 and other pending applications, if any, stand

disposed of. No costs.

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

(R.M. LODHA)

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

(JAGDISH SINGH KHEHAR )

NEW DELHI

NOVEMBER 2, 2011.

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