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PETITIONER: BABUBHAI & CO. & ORS.

       Vs.

RESPONDENT: STATE OF GUJARAT & ORS

DATE OF JUDGMENT09/04/1985

BENCH: TULZAPURKAR, V.D. BENCH: TULZAPURKAR, V.D. KHALID, V. (J)

CITATION:  1985 AIR  613            1985 SCR  (3) 614  1985 SCC  (2) 732        1985 SCALE  (1)658  CITATOR INFO :  R          1986 SC 468  (32)  R          1989 SC1949  (10)

ACT:              Bombay Town planning Act 1954 ,  s 54 read with Rule 27  of Bombay  Town planning  Rules 1955  Provision for summary eviction  of  lands  required  for  public  purpose- Absence of a corrective machinery by the appeal or revision- validity of.

HEADNOTE:      The respondent-State  issued  notice  u/s.  54  of  the Bombay Town  Planning Act 1954 (for short the Act) read with Rule 27  of the  Bombay Town  Planning Rules 1955 (for short the Rules)  to the  appellants to  hand over  possession  of their lands  lying within the limits of Borough Municipality of Ahmedabad  to the  Municipal Corporation  of Ahmedabad as the  same   had  vested   absolutely  -   in  the  Municipal Corporation free  from all encumbrance u/s 53 (a) of the Act and were required for construction of roads and other public purposes. The  appellants challenged  before the  High Court under Art.  226 the  constitutional validity of s. 54 of the Act and  Rule 27  of the Rules. The High Court dismissed the writ petitions  holding; (i)  that the  rights of  the local authority (to  own and obtain possession of such lands) with the corresponding  liability  of  the  occupants  to  suffer eviction therefrom  did not  exist under the general 11’ law prior to  the making of the Final Scheme ,  that such rights and liabilities were created for the first time by the Final Scheme which  is to be read as part of the Act and since the Act while creating these new rights and liabilities provided for a special and particular remedy for enforcing them under s. 54  ,   the remedy of summary eviction must be held to be an exclusive  remedy and  the liability  to eviction arising under s.  53 (a)  or (b)  cannot be enforced by the ordinary remedy of  a suit;  (ii) that  s 54 conferred upon the local authority a  quasi-judicial  power  and  not  administrative power and  as such  it was  bound ,   in conformity with the principles of  natural justice  ,  to give an opportunity of hearing to the occupants before taking the threatened action of summary  eviction and  therefore no  question of  section being bad in law arose; and (iii) that since Rule 27 did not

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contain any express exclusion of such hearing and since s.54 impliedly required  the observance  of principles of natural justice on the part of the local authority 615 while exercising  the power  of summary eviction ,  the said requirement must  also be  read in  Rule 27  and so read the Rule could not be regarded as ultra vires the section.      In appeals  to this  Court ,   the appellants contended that even  proceeding on  the basis  that  s.  54  impliedly required a  hearing to  be given  and  consequently  such  a requirement  could   be  read   into  Rule   27  which   was asubordinate piece of legislation ,  there was no corrective machinery provided  for by  way of  an appeal or revision to any superior  authority against an adverse order that may be passed by  the local  authority acting  under Rule 27 and in the absence  of any  such corrective  machinery  the  entire provision must  be held  to be  bad in law and therefore the impugned notices served on the appellants should be quashed.      Dismissing the appeals , ^      HELD: (1) Mere absence of a corrective machinery by way of appeal  or revision  by itself  would not  make the Power unreasonable or  arbitrary ,   much  less would  render  the provision invalid.  Regard will  have to  be had  to several factors ,  such as ,  on whom the power is conferred whether on a  high official or a petty officer ,  what is the nature of the  power-whether the  exercise thereof depends upon the subjective satisfaction  of the authority or body on whom it is conferred  or  is  it  to  be  exercised  objectively  by reference to  some existing facts or tests ,  whether or not it is  a quasi-judicial  power requiring  that authority  or body to  observe principles  of natural  justice and  make a speaking order  etc.; the last mentioned factor particularly ensures application  of mind on the part of the authority or body only  to pertinet  or germane  material on  the  record excluding the  extraneous and  irrelevant and  also subjects the order  of the  authority or  body to  a judicial  review under the  writ jurisdiction  of the  Court  on  grounds  of perversity ,   extraneous  influence ,   malafides and other blatant infirmities.  Moreover all  these facts will have to be considered  in the  light of  the scheme of the enactment and the  purpose intended  to be  achieved by  the concerned provision. If  on  an  examination  of  the  scheme  of  the enactment as  also the purpose of the concerned provision it is found  that the  power to decide or do a particular thing is conferred  on a  very minor  or petty officer ,  that the exercise  thereof   by  him   depends  on   his   subjective satisfaction ,   that  he is  expected to exercise the power administratively without  any obligation  to make a speaking order then  ,   of courtesy  ,   the absence of a corrective machinery will render the provision conferring such absolute and unfettered  power invalid.  But  it  is  the  cumulative effect of  all these  factors that will render the provision unreasonable or arbitrary and liable to be struck down.                                             [619F-H; 620A-D]      (2) In  the instant  case ,   it  is at  the  stage  of execution of  a town  planning  scheme  that  the  power  of summary eviction of occupants who have ceased to be entitled to occupy  the plots  in their occupation has been conferred upon the  Local Authority itself-a highly responsible body , and that  the power  is required  to be  exercised by  it in objective manner  (it is  to be  found by  reference to  the Final Scheme  and its  interpretation whether  the occupants are occupying 616

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lands which  they are not entitled to occupy.) Further ,  as already held  by the  High Court ,  the power conferred upon the local  Authority is a quasi-judicial power which implies that the  same has  to  be  exercised  after  observing  the principles of  natural justice  ,  and that too by passing a speaking order  which implies  giving of  reasons  and  that ensures the  application of mind to only germane or relevant material on the record eschewing extraneous and irrelevant , Moreover  any   order  of  summary  eviction  based  on  any extraneous ,    non-  germane  ,    irrelevant  or  malafide considerations would  be subject to the writ jurisdiction of Court. [625E - H; 622A]            C. R. H. Ready money Ltd. case in AIR 1956 Bombay 304 ,   Chandrakant Krishnarao’s case ,  in [1952] 3 SCR 108 ,   Lala Hari  Chand Sarda’s  case ,  [ 1967] 1 SCR 1012 and Excel Wear’s case in [1979] 1 SCR 1009 ,  referred to          Organo Chemical Industries & Another v- Union India and Others ,  relied upon.

JUDGMENT:             CIVIL APPELLATE JURISDICTION : Civil Appeals Nos 2084 2089 (N) of 1972 a              From  the Judgment dated 24.12.1971 of the High court of Gujarat in Special Civil Applications Nos. 650/71 , 652-654/71 ,  81/71 and 64/71      Soli J.  Sorabiee ,   Kamal Mehta ,  Aditya Narayan and Mrs. A.K. Verma for the Appellants      M.N. Phadke and R.N. Poddar for the Respondents.      S.T. Desai and H.S.Parihar for Respondent Nos. 2 & 3.      The Judgment of the Court was delivered by      TULZAPURKAR ,   J.  There  is  no  substance  in  these appeals  preferred   by  the  appellants  against  a  common judgment rendered  in a  batch of writ petitions by the High Court on  24th December  1971 wherein  the  High  Court  has upheld the  constitutional validity  of s.  54 of the Bombay Town Planning  Act 1954  (for short  the Act) and Rule 27 of the Bombay Town Planning Rules 1955 (for short the Rules).          By a notification dated 21st July ,  1965 the State Government of  Gujarat sanctioned  the final  Town  Planning Scheme in respect 617 of  certain   areas  lying  within  the  limits  of  Borough Municipality of  Ahmedabad and  directed that the said Final Scheme shall  come into  force on 1st September ,  1965. The lands in  the possession  of the appellants were allotted or reserved for construction of roads and other public purposes in that  Scheme and therefore ,  being lands required by the Municipal Corporation  they vested  absolutely in  Municipal Corporation (local  authority) free  from  all  encumbrances under s.  53 (a)  of the  Act. Thereafter  by notices issued under s.54  read with  Rule  27  the  Municipal  Corporation called upon  the appellants  to hand  over possession of the lands in their - occupation ,  which ,  since such vesting , they were  not entitled  to occupy;  in other  words ,   the procedure  or   the  remedy  for  summary  eviction  of  the appellants was resorted to by the Municipal Corporation.      By  writ   petitions  filed   under  s.   226  of   the Constitution the appellants challenged the validity of these notices on two grounds:      (a)  that s  54 confers  absolute discretion  upon  the           local  authority   to  adopt   for  eviction   the           occupants of  such lands  either the normal remedy           of a  civil suit  or the drastic remedy of summary

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         eviction under  it without  any guide-lines  being           prescribed or  indicated for  the exercise of such           discretion and therefore the section was violative           of Art.  14 inasmuch  as the local authority could           pick ’and  choose at  its sweet  will some of such           occupants for  subjecting them to the more drastic           remedy;      (b)  that s.  54 which provides for summary eviction by           service  of  notice  contemplated  thereunder  was           opposed to  principles of natural justice inasmuch           as no  opportunity was contemplated to be afforded           to the  occupants of  such  lands  to  show  cause           against the  proposed eviction and as such was bad           in law;  and in  any event even if s. 54 was ,  on           proper construction  held to include the affording           of such  opportunity Rule  27 was  ultra vines the           said  section   inasmuch  as   it  laid  down  the           procedure which  did not  conform to principles of           natural justice.      The High  Court  has  negatived  both  the  grounds  of challenge. As : 618 regards ground  (a) ,   relying upon the decision in Wolver- hampton New Water Works case reported in ( 1859) 6 B. (N.S.) 336 and observations of Willes J. therein (appearing at page 356 of  the Report)  the High  Court took  the view that the rights of  the local authority (to own and obtain possession of such  lands) with  the  corresponding  liability  of  the occupants to  suffer-eviction therefrom  did not exist under the law prior to the making of the Final Scheme ,  that such rights and  liabilities were  created for  the first time by the Final Scheme which is to be  read as part of the Act and since the  Act creating  these new  rights  and  liabilities provided for  a special  and particular remedy for enforcing them under s. 51 the remedy of summary eviction must be held to be  an exclusive  remedy and  the liability  to  eviction arising under  s. 53  (a) or  (b) cannot  be enforced by the ordinary remedy  of a  suit; in other words ,  the remedy of summary eviction  under s.  54 having  been held  to  be  an exclusive remedy the entire ground of challenge disappeared. As regards  ground (b)  the High Court took the view that s. 54 conferred upon the local authority a quasi-judicial power and not  administrative power  and as  such it  was bound  , conformity with the principles of natural justice ,  to give an opportunity of hearing to the occupants before taking the threatened action  of  summary  eviction  and  therefore  no question of  section being bad in law arose; as regards Rule 27 the  High Court  held that  since the  said Rule  did not contain any  express exclusion  of such hearing and since s. 54  impliedly  required  the  observance  of  principles  of natural justice  on the  part of  the local  authority while exercising the  power  of  summary  eviction  ,    the  said requirement must  also be  read in  Rule 27  and so read the Rule could  not be  regarded as ultra vires the section. The High Court  also proceeded  to indicate  in what  ways  such hearing could  be afforded  by  the  local  authority  while acting under  the said  Rule. This  is how  the  High  Court upheld the  constitutional validity  of s. 54 of the Act and Rule 27 of the Rules.      Counsel for the appellants fairly conceded the validity of the High Court’s view on the first ground of challenge to s. 54.  It was  only in  regard  to  the  second  ground  of challenge that  he pressed  one more aspect before us on the basis of which he contended that s. 54 read with Rule 27 may have to be struck down. He urged that even proceeding on the

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basis that  s. 54  impliedly required  a hearing to be given and consequently  such a requirement could be read into Rule 27 which was a subordinate piece of legislation ,  there was no 619 corrective machinery  provided for  by way  of an  appeal or revision to  any superior authority against an adverse order that may  be passed by the local authority acting under Rule 27 and  in the  absence of any such corrective machinery the entire provision must be held to be bad in law and therefore the impugned  notices served  on the  appellants  should  be quashed. In  support of  this contention counsel relied upon three or  four decisions  in C.R.H. Ready money Ltd. case(l) Chandrakant Krishnarao’s  case , (2) Lala Hari Chand Sarda’s case(3) and Excel Wear’s case(4) where a view has been taken that in  the absence of a provision for corrective machinery by way  of appeal  or revision ,  the provision conferring a power to  decide or  do a  particular thing  may have  to be regarded as  unreasonable and  or un-guided ,  un-controlled and arbitrary  and hence  violative of  Article  14  of  the Constitution. It is not possible to accept the contention.      It cannot  be disputed  that the absence of a provision for a corrective machinery by way of appeal or revision to a superior authority  to rectify an adverse order passed by an authority or  body  on  whom  the  power  is  conferred  may indicate that  the power  so conferred  is  unreasonable  or arbitrary but  it is  obvious that providing such corrective machinery is only one of the several ways in which the power could be  checked or  controlled and its absence will be one of the  factors to  be considered  along with several others before coming  to the conclusion that the power so conferred is unreasonable or arbitrary; in other words mere absence of a corrective  machinery by  way of  appeal  or  revision  by itself would  not make the power unreasonable or arbitrary , much less  would render  the provision  invalid. Regard will have to  be had to several factors ,  such as ,  on whom the power is  conferred-whether on  a high  official or  a petty officer ,   what  is the  nature of  the  power-whether  the exercise thereof depends upon the subjective satisfaction of the authority or body on whom it is conferred or is it to be exercised objectively by reference to some existing facts or tests ,   whether  or  not  it  is  a  quasi-judicial  power requiring that  authority or  body to  observe principles of natural justice and make a (l) A.I.R. 1956 Bom. 304 (2) [1962] 3.S.C.R. 108 (3) [1967] 1.S.C.R. 1012 (4) [1979] 1.S.C.R. 1009 620 speaking order  etc; the  last mentioned factor particularly ensures application  of mind on the part of the authority or body only  to pertinent  or germane  material on  the record excluding the  extraneous and  irrelevant and  also subjects the order  of the  authority or  body to  a judicial  review under the  writ jurisdiction  of the  Court  on  grounds  of perversity,   extraneous influence  ,   malafides and  other blatant infirmities  Moreover all these factors will have to be considered  in the  light of  the scheme of the enactment and the  purpose intended  to be  achieved by  the concerned provision. If  on an  examinations  of  the  scheme  of  the enactment as  also the purpose of the concerned provision it is found  that the  power to decide or do a particular thing is conferred  on a  very minor  or petty officer ,  that the exercise  thereof   by  him   depends  on   his   subjective satisfaction ,   that  he is  expected to exercise the power

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administratively without  any obligation  to make a speaking order then  ,   of course  ,   the absence  of a  corrective machinery will render the provision conferring such absolute and unfettered  power invalid.  But  it  is  the  cumulative effect of  all these  factors that will render the provision unreasonable or  arbitrary and  liable to be struck down. In three of  the decisions  referred to  by counsel  where  the concerned provision was struck down the cumulative effect of several factors  that were  present in  each was  taken into consideration by  the Court  ,  while in C.R.H. Readymoney’s case the provision was held to be valid .      In this behalf we might usefully refer to a decision of this Court in Organo chemical Industries Another V. Union of India and  Others.(1) In  this case  s. 14B of the Employees Provident Fund  and Miscellaneous  Provisions Act 1952 which conferred power upon the Central Provident Fund Commissioner to levy  and recover  punitive  damages  from  a  defaulting employer was  challenged on the ground that within the limit of 100%  of the  defaulted amount  it  conferred  naked  and unguided power  on the Commissioner to impose any quantum of damages as  he fancied  that no  reasons were required to be given by  him for  such imposition  and that no appellate or revisional review  was prescribed  against any adverse order that may  be made  by  him  and  as  such  the  section  was violative of  Art. 14  of the  Constitution. Negativing  the contention this Court took the (1) [9801] 1 S.C.R. 61. 621 view that  the power  under the  section had  been conferred upon one  of the highest officials of the Government ,  that the power to impose damages on a party after hearing him was a quasi-judicial  one that  observance  of  requirements  of natural justice  was implicit  in such jurisdiction that one desideratum thereof  was spelling out of the reasons for the order to  be made ,  that giving of reasons ensured rational action on  the part  of the  Officer because reasons implied relevant reasons  necessitating the  application of  mind on the part  of the  Officer  only  to  pertinent  and  germane material on  record and  that once  reasons were set out the order readily exposed itself to the writ jurisdiction of the Court so  that  perversity  ,    illiteracy  ,    extraneous influence ,   malafides  and other  blatant infirmities  got caught and  corrected. Under  such circumstances  this Court held that  the needs  of the factual situation and the legal milieu were  such that the absence of appellate review in no way militated  against the justice and reasonableness of the provision and  that the  argument of  arbitrariness on  this score was untenable.      In the  instant case on an examination of the Scheme of the Act  as also  the purpose sought to be achieved by s. 54 it will  appear clear  that the  topic  of  making  of  town planning schemes  is dealt  with in ss. 21 to 53 while s. 54 (and some  of the  following sections  like 55 and 71 to 78) deal with  the aspect  of the  execution  of  town  planning schemes and  it is  at the  stage of  execution  of  a  town planning scheme  that  the  power  of  summary  eviction  of occupants who have ceased to be entitled to occupy the plots in their  occupation  has  been  conferred  upon  the  Local Authority itself-a  highly responsible  body ,  and that the power is  required to be exercised by it in objective manner (it is  to be found by reference to the Final Scheme and its interpretation whether  the occupants  are  occupying  lands which they are not entitled to occupy , ). Further we are in agreement with  the High Court that the power conferred upon the Local  Authority is a quasi-judicial power which implies

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that the  same has  to  be  exercised  after  observing  the principles of  natural justice  ,   that is  to say  ,   the decision that  the occupants  are not entitled to occupy the plots in their occupation has to be arrived at after hearing such occupants  and that  too by  passing a  speaking  order which  implies  giving  of  reasons  and  that  ensures  the application of  mind to only germane or relevant material on the record 622 eschewing extraneous  and irrelevant.  Moreover any order of summary eviction  based on  any extraneous  ,  non-germane , irrelevant or  malafide considerations  would be  subject to the writ  jurisdiction of  Court.  Having  regard  to  these aspects ,   more  absence of  corrective machinery by way of appeal or  review would not in our view render the provision invalid.      In the  result the  appeals are dismissed with no order as to costs. M.L.A.                                           Appeals dismissed. 623