http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 10  

PETITIONER: LALJI KHIMJI AND ORS.

       Vs.

RESPONDENT: STATE OF GUJARAT

DATE OF JUDGMENT29/01/1993

BENCH: ANAND, A.S. (J) BENCH: ANAND, A.S. (J) SHARMA, L.M. (CJ)

CITATION:  1993 SCR  (1) 366        1993 SCC  Supl.  (3) 567  JT 1993 (2)    89        1993 SCALE  (1)239

ACT: Bombay Irrigation Act, 1879 : Sections  3(6),  17,18 and 77 and  Notification  dated  27th September,   1963-Executive  Engineer  appointed  as   Canal Officer-Whether competent to enter into agreement/compromise with   landlords  on  behalf  of   Government-Whether   such agreement binding on Government. Constitution of India, 1950 : Article  299-Agreement entered into by  Executive  Engineer, appointed  as Canal Officer, with landlords in  exercise  of powers vested under the Bombay Irrigation Act,  1879-Whether a contract within the meaning of the Article-Whether invalid for  non-satisfaction  of  essential  requirements  of   the Article.

HEADNOTE: Under an Irrigation Scheme, the respondent-State proposed to construct  a  dam  on a river in the State  and  prepared  a sketch, indicating the passage of the canal from the Dam and for  that purpose, proceeded to acquire land  through  which the  canal was proposed to run.  Apprehending  that  serious damage  will be caused to their lands by the passing of  the canal  through their lands, the appellants-farmers  filed  a suit  against the respondent-State, seeking to  restrain  it from  implementing  the  Irrigation  Scheme,  as   proposed. During the pendency of the suit an agreement was arrived  at between  the parties to the effect that the canal  from  the Dam  would be run as per the line demarcated in red  in  the map  appended  to the deed of agreement.  As a  result,  the suit  was unconditionally withdrawn by the  appellants,  but subsequently,  on discovering that the State Government  was going back from the agreement and the alignment of the canal was being undertaken contrary to the alignment reflected  in red in the map appended to the agreement, they filed a fresh suit  for  declaration  to the  effect  that  the  agreement entered  into between them and the respondents  through  its Executive  Engineer, Irrigation Department, was  binding  on the 367 parties and that the parties were bound to act according  to the  terms  of  the said agreement and  for  an  injunction, restraining  the  respondent-State from going  back  on  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 10  

agreement. The trial court decreed the suit and permanently  restrained the  State  from going back from the  agreement  and  acting otherwise  than  as per the terms of the same.   The  appeal preferred  by the State was also dismissed by  the  District Judge. The  State  riled  a second appeal  before  the  High  Court contending  that  the alleged compromise/agreement  was  not binding  upon the State, inasmuch as the Executive  Engineer had no authority to agree on behalf of the State  Government as  he  was not the representative of the  Government.   The High  Court  held  that the agreement was a  null  and  void document for non-compliance with the mandatory provisions of Article  299(1) of the Constitution.  It also  rejected  the appellants’  plea that under the statutory powers  conferred by  section  18  of  the Bombay  Irrigation  Act,  1879  the Executive Engineer was competent to enter into a  compromise and that the said compromise arrived at during the  pendency of the earlier suit was binding on the Government. In  the  appeal  filed before this Court on  behalf  of  the appellants farmers, it was submitted that reliance placed on Article  299  of  the  Constitution  of  India  was   wholly erroneous,  that by a Notification, dated 27th of  September 1963, published in Part IV-B of the Government Gazette,  the State  Government had appointed all Executive Engineers  and Superintending Engineers in charge of canals in the State to be Canal Officers in respect of such canals and assigned  to them  all the powers and duties of the Canal Officers  under the  Act  and, therefore, the  agreement/compromise  entered into  by the Executive Engineer during the pendency  of  the suit  of which he was doing ’pervi’ was a  validly  executed compromise  which was binding on the parties and  respondent could  not  go back on it, and that after  having  made  the appellants  to withdraw their earlier suit on the  basis  of the agreement, it was not permissible for the respondent  to dispute the act done by its officers or agents within  their powers under the statute. Allowing the appeal, this Court, HELD  :  1.1.  The agreement/compromise arrived  at  in  the previous 368 suit,  could not have been equated with a  contract  between the State and the citizen. 1.2. Article 299(1) of the Constitution concerns itself with contracts  and  assurances  of property and  lays  down  how Government  contracts, including assurances of property  are to  be made and executed.  The provisions of Article 2"  are mandatory in character and their non-compliance would render a contract void, but where the agreement is not referable to Article  299 and is not a contract, as contemplated by  that Article,  the  agreement  cannot  be  invalidated  for   not satisfying the essential requirements of Articles 299 of the Constitution. [375B, D-E]    1.3.   There  is a marked distinction  between  contracts which  are executed in exercise of the executive powers  and agreements  or orders made, which are statutory  in  nature. Articles  299(1) applies to a contract made in  exercise  of the executive power of the Union or the State and it has  no application to a case where a particular statutory authority as distinguished from the Union or the State, enters into an agreement within his authorised capacity. [375F] State  of Haryana and Ors. v. Lal Chand and Ors.,  [1984]  3 S.C.C. 634, relied on.   1.4.    A  compromise  of  the  nature  contained  in  the agreement  arrived at during the pendency of a suit, in  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 10  

instant case is not a contract executed between the  parties as envisaged by Article 299. [375E]   2.1     It  is  clear  from the record  that  it  was  the Executive Engineer who was doing ’pervi’ of the case in  the suit  filed earlier.  The agreement in question was  entered into  during  the  pendency of the  said  case.   The  State Government   had  appointed  all  Executive  Engineers   and Superintending Engineers in-charge of canals in the State to be Canal Officers in respect of such canals and assigned  to them  all the powers and duties of the Canal Officers  under the Act by virtue of the Notification dated 27th  September, 1963.  Thus, it is manifest that the Executive Engineer,  by virtue of the said Notification, had been lawfully appointed as  Canal Officer within the meaning of Section 3(6) of  the Bombay Irrigation Act, 1879.                               [377F-H, 378A] 2.2. Section 18 of the Act vests the Canal Officers with the power to 369 hold  Inquiry  and  direct  the  construction  of   suitable alignments for a water course and by Section 77 of the Act a Canal  Officer  Is  vested with  the  authority  to  survey, demarcate and make a map of the land which, in his  opinion, Is  suitable  for constructing an alignment  for  the  water course.                                             [378A]     23.   Thus,   under   the   statute,   read   with   the notification  dated 27th September, 1963, the Canal  Officer (Executive Engineer) was fully competent to decide about the particular alignment of the water course and it fell  within the  jurisdiction of the Canal Officer to decide and  settle about the suitable demarcation of the alignment of the water course  of  the  canal  from the Dam,  in  question  and  he exercised  that  jurisdiction  under  the  statute  when  he demarcated  the water course in red, in the map attached  to the  agreement.  It is the content of the agreement and  not its  form  which is relevant to trace the  source  of  power behind  it and in the light of the statutory provisions,  it Is  manifest  that  the document has been  executed  by  the Executive Engineer by virtue of the statutory powers  vested In  him.   The  circumstance that the  agreement  came  into existence  during the pendency of the suit and was  executed by  way of an agreement does not militate against the  order of  alignment as reflected therein being any less  statutory in character. [378B-D]     2.4. The Act itself envisages that the Canal Officer may after  and  settle the alignment in  consultation  with  the landholders  through which the water course is to  run.   In the agreement in question, the Executive Engineer had agreed to  alter the alignment of the water course in  consultation with the appellants who thereupon ’unconditionally’ withdrew the  suit  since no grievance remained to be  settled.   The altered alignment was, therefore, validly made by  following the procedure envisaged by the Act.  The High Court fell  in error  in  ignoring the statutory powers  of  the  Executive Engineer, vested in him under Sections 18 and 77 of the  Act read  with the notification or 27th September, 1963  on  the true import of agreement. [378E-F]    2.5.   Under  these  circumstances,  the  agreement   was lawfully  executed by the Executive Engineer in exercise  of his statutory powers under the Act and the State was obliged to  act  according to the terms of the said  agreements  and could  not give it a go bye without following the  procedure under the Act to again alter the alignment [378G] 370

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 10  

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 47 of 1979. From  the Judgment Order dated 20.1.77 of the  Gujarat  High Court in Second Appeal No. 90 of 1976. Krishan Kumar for Vimal Chandra S. Dave for the Appellants. Ms. Meenaksh Arora for Anip Sachthey for the Respondent. The Judgment of the Court was delivered by ANAND, J. This appeal by special leave, is directed  against the  judgment  of  the  Gujarat High  Court  dated  20th  of January, 1977 in Second Appeal No. 90 of 1976. The  plaintiffs-appellants  are the farmers of  the  Village Morzar  under  Bhanwad Taluka of Jamnagar  District.   Their lands  are situated on the outskirts of the village.   Under the   Vartu  Dam  Irrigation  Scheme,  the   defendant-State proposed  to construct a Dam on river Vartu and  prepared  a sketch,  indicating the passage of the canal from Vartu  Dam and  for that purpose, it proceeded to acquire land  through which  the  canal  was proposed  to  run.   The  plaintiffs- appellants apprehended serious damage to their lands by  the passing  of the canal through their lands and they  filed  a Regular  Civil  Suit in 1966  against  the  defendant-State, seeking  to  restrain it from  implementing  the  Irrigation Scheme,  as  proposed.  Suit was registered  and  defendants were summoned.  During the pendency of the suit, it  appears that an agreement was arrived at between the parties and  it was agreed that the canal from Vartu Dam would be run as per the  line demarcated in red in the map appended to the  deed of  agreement Ex.45. As a result of the said  agreement  the suit  was  unconditionally withdrawn by  the  plaintiffs  on 24.11.1966.  Somewhere  in 1972,  the  plaintiffs-appellants discovered that the State Government was going back from the agreement  and alignment of the canal was  being  undertaken contrary  to the alignment reflected in the map appended  to the agreement Ex.45. They, therefore, filed a fresh suit for declaration   to  the  effect  that  the  agreement,   dated 7.11.1966,  entered  into between them and  the  respondents through   its  Executive  Engineer,  Irrigation   Department Jamnagar,  was binding on the parties and that  the  parties were  bound  to  act  according to the  terms  of  the  said agreement and for an injunction, restraining the  defendant- State  from going back on the agreement.  This suit  of  the plaintiffs-appellants was contested and the following issues were framed 371               (1)   Whether   the   suit   agreement   dated               7.11.1966 is not binding to the defendant ?               (2)   If  it is binding whether the  plaintiff               prove  that they have complied with the  terms               and conditions of this agreement?               (3)   Whether  the  suit  as  framed  is   not               maintainable?               (4)   Whether  the  suit is bad for  the  mis-               joinder  of  the plaintiffs and the  cause  of               action?               (5)   Whether the suit is not maintainable  as               the  agreement  dated 7.11.1966 has  not  been               registered of because no compromise decree had               been passed in terms of this agreement?               (6)   Whether the suit is not in time?               (7)   Whether  the plaintiffs are entitled  to               the declaration sought?               (8)   Whether  the plaintiffs are entitled  to

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 10  

             get the permanent injunction as prayed for  by               them?               (9) What order? Issues  1  to 8 were decided in favour  of  the  plaintiffs- appellants and against the defendant-State.  The Trial Court decreed the suit and declared that the suit agreement  dated 7.11.1966 entered between the plaintiffs and the  defendants through  its executive engineer, was binding on the  parties and  that the parties were bound to act in  accordance  with the  terms  of the said compromise the defendant  state  was permanently  restrained from going back from  the  agreement and act otherwise than as per the terms of the same. The  State  of Gujarat preferred an appeal in the  Court  of District  Judge Jamnagar against the judgment and decree  of the  Trial Court.  During the hearing, the parties  confined their arguments to the following two points (1)  Whether the agreement dated 7.11.66 is binding to the 372 State of Gujarat? (2)  Whether  the  plaintiffs are entitled to  the  reliefs, granted to them by the trial court? The  appellate  court  answered both the  questions  in  the affirmative  and  by  its  order  dated  October  20,   1975 confirmed  the judgment and decree of the trial court.   The appeal  of  the State of Gujarat was dismissed.   The  State filed  a  Second Appeal in the High Court.  The  High  Court examined  the agreement dated 7.11.1966, Ex. 45 which is  in Gujarati  and is described as Rojkam on the subject  of  the alignment  of Vartu Canal.  The High Court noticed that  the Rojkam  refers to the filing of the suit in the Civil  Court and  the  meeting  between the Executive  Engineer  and  the occupants  of  land  and proceeded to  recite  that  on  the aforesaid  subject  there was discussion  of  the  Executive Engineer  with the occupants and thereafter both  the  sides have  amicably settled(compromised) the dispute with  regard to  the alignment of the canal.  The Rojkam further  records that  both the sides have agreed to the alignment  shown  in rose colour in the map.  The Rojkam then records:               "The  Executive  Engineer  Mr.  B.V.  Nanavati               having    assured   of    getting    necessary               alterations as aforesaid made, they (i.e., the               plaintiffs   or  the  occupants)  have   shown               willingness  to withdraw  unconditionally  the               suit filed in Civil Court." The  Rojkam is signed by the Executive Engineer as  also  by the occupants. Before the High Court, the main plea raised by the State was that  the alleged compromise/agreement was not binding  upon the State.  It was stated that the State does not admit  any agreement made by the Executive Engineer either on behalf of the  State  or  as  a  representative  of  the  State   and, therefore,  the so called agreement did not bind  the  State Government.  It was asserted by the State that the Executive Engineer  had no authority to agree on behalf of  the  State Government   as  he  was  not  the  representative  of   the Government.   Similar plea had been raised before the  trial court  and the lower appellate court but was rejected.   The High  Court,  however, accepted the plea of  the  State  and found  that  the  courts below had  erred  in  ignoring  the mandatory  provisions of Article 299 of the Constitution  of India which mandates that all contracts made in the exer- 373 cise of the executive power of the Union or of a State shall be expressed to be made by the President or by the  Governor of  a State, as the case may be, and all such contracts  and

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 10  

all  assurances  of property made in the  exercise  of  that power  shall  executed  on behalf of the  President  or  the Governor  by  such persons and in such a manner  as  he  may direct  or  authorise.  The High Court found that  for  non- compliance  with  the provisions of Article  299(1)  of  the Constitution of India which are mandatory in character,  the agreement  Ex. 45, was a null and void document.   The  High Court then observed :               "Apart from the question whether the Executive               Engineer  in the present case was directed  or               authorised to execute this agreement on behalf               of  the State Government, it is clear  on  the               face  of  the document Ex.45 itself  that  the               alleged  agreement  contained therein  is  not               expressed  to be made by the  Governor.   This               position is incontrovertible and even Mr. Shah               for  plaintiffs-respondents  was not  able  to               show  that  the document  Exh.45  contains  an               agreement   expressed  to  be  made   by   the               Governor.   Really  speaking,  on  a   correct               interpretation  of  this document  Exh.45,  it               only  contains basis of the  compromise  terms               between   the  Executive  Engineer   and   the               occupants (who probably were plaintiffs of the               earlier   suit)  as  regards  the  change   of               alignment;  and pursuant to  which  compromise               the  plaintiffs agreed to withdraw  the  suit.               The  Governor  or  the  State  Government   is               nowhere  in the picture if we go through  this               agreement.    Therefore,  assuming  that   the               document  contains an agreement in reality  it               is  an  agreement not by the Governor  or  the               state Government but by the Executive Engineer               with the occupants who signed the same.   Such               an  agreement which is not in compliance  with               the   provisions   of  Article  299   of   the               Constitution is void and unenforceable against               the  State.  If this is so, the suit filed  by               the respondents-plaintiffs must fail." The High court negatived the contention raised on behalf  of the  plaintiffs-appellants  to  the effect  that  under  the statutory  powers  conferred  by Section 18  of  the  Bombay Irrigation  Act,  1879  (hereinafter called  the  Act),  the Executive  Engineer was competent to enter  into  compromise and 374 that  the said compromise arrived at during the pendency  of the  earlier suit was binding on the Government.   The  High Court said :               "Then it was contended that in exercise of his               powers under section 18 of the aforesaid  Act,               the   Executive   Engineer   acts   for    the               Government;  and, therefore, the agreement  in               question is binding on the Government.   There               is  an inherent misconception underlying  this               contention.  While exercising statutory powers               i.e. powers conferred by a statute an  officer               of  the  Government  does  not  act  for   the               Government.   He  acts  not  because  of   any               authority  derived  from  the  Government   to               exercise   power  conferred  on  him  by   the               Statute.  This contention must also fail." As a consequence, the appeal filed by the State was  allowed and the judgment and decree passed by the courts below  were reversed and the suit filed by the plaintiffs-appellants was

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 10  

dismissed with costs throughout. Learned counsel for the appellants has assailed the judgment of    the    High    Court   and    submitted    that    the agreement/compromise,  Ex.45, had been validly entered  into by the Executive Engineer with the appellants in view of the statutory  powers  vested in the  Executive  Engineer  under Section 18 of the Act and reliance placed on Article 299  of the Constitution of India, in the facts and circumstances of this  case,  was wholly erroneous.  It was urged that  by  a Notification,  dated  27th of September 1963,  published  in Part  IV-B of the Gujarat Government Gazette dated  31st  of October,  1963, the Government of Gujarat had appointed  all Executive  Engineers and superintending Engineers  in-charge of  canals in the State of Gujarat to be Canal  Officers  in respect  of such canals and assigned to them all the  powers and  duties  of  the  Canal Officers  under  the  Act,  and, therefore,  the  agreement/compromise entered  into  by  the Executive  Engineer on 7.11.1966 during the pendency of  the suit  of which he was doing "pervi" was a  validly  executed compromise  which  was  binding  on  the  parties  and   the respondent  could  not go back on it.  Having been  made  to withdraw  their earlier suit on the basis of the  agreement, dated  7.11.1966, it was not permissible for the  respondent to now dispute the act done by its officers or agents within their powers under the statute. In  the facts and circumstances of this case, we find  force in  the  submission of learned counsel  for  the  appellants regarding the non-ap- 375 placability  of Article 299 of the Constitution of India  to invalidate the agreement/compromise dated 7.11.1966  arrived at  during  the pendency of the earlier suit  filed  by  the appellants  relying  whereupon the appellants  withdrew  the earlier suit.  The agreement/compromise Ex.45, arrived at in the  previous  suit,  could not have  been  equated  with  a contract between the State and the citizen.  Article 299 (1) which reads thus :               "All  contracts  made in the exercise  of  the               executive  power  of the Union or of  a  State               shall   be  expressed  to  be  made   by   the               President, or by the Governor of the State, as               the  case may be, and all such  contracts  and               all   assurances  of  property  made  in   the               exercise  of that power shall be  executed  on               behalf  of  the President or the  Governor  by               such  persons  and in such manner  as  he  may               direct or authorise." concerns  itself with contracts and assurances  of  property and lays down how Government contracts, including assurances of  property  are  to be made  and  executed.   Indeed,  the provisions  of  Article 299 are mandatory in  character  and their non-compliance would render a contract void but  where the  agreement is not referable to Article 299 and is not  a contract,  as  contemplated by that Article,  the  agreement cannot  be  invalidated  for not  satisfying  the  essential requirements   of  Article  299  of  the  Constitution.    A compromise  of the nature contained in the  agreement  dated 7.11.1966, arrived at during the pendency of a suit, is  not a  contract  executed between the parties  as  envisaged  by Article   299.   There  is  a  marked  distinction   between contracts  which are executed in exercise of  the  executive powers and agreements or orders made which are statutory  in nature.   Article  299(1)  applies to  a  contract  made  in exercise  of the executive power of the Union or  the  State and  it  has  no application to a case  where  a  particular

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 10  

statutory authority, as distinguished from the Union or  the State,  enters  into  an  agreement  within  his  authorised capacity.   In State of Haryana & Ors. v. Lal Chand &  Ors., [1984]  3 SCC 634 this Court considered a contract  granting exclusive  privilege of liquor vending, in exercise  of  the statutory  powers referable to Punjab Excise Act,  1914  and Punjab  Liquor Licence Rules, 1956, and held that the  grant of  the  exclusive privilege gave rise to a  contract  of  a statutory nature, distinguished from the one executed  under Article  299(1)  and,  therefore,  compliance  with  Article 299(1) was not required in such a case. 376 The question which immediately arises for our  consideration is : Was   the  Executive  Engineer  competent  to  execute   the agreement Ex.45? In this connection, it would be relevant to refer to some of the more relevant statutory provisions contained in the Act. Section 3(6) provides as follows :               (6)   "Canal   Officer"  means   any   officer               lawfully  appointed  or invested  with  powers               under section 4;               Section 17 reads thus;               "Any  persons  desiring  to  construct  a  new               water-course, but being unable or unwilling to               construct it under a private arrangement  with               the holder of the land required for the  same,               may apply in writing to any Canal Officer duly               empowered   to  receive   such   applications,               stating;               (1)   that  he  is  ready to  defray  all  the               expense necessary               for   acquiring the land and constructing such               water-course;               (2)   that  he desires the said Canal  Officer               in his behalf               and   his cost to do all things necessary  for               constructing               such  water-course."               Section 18 provides as follows               "If   the   Canal   Officer   considers    the               construction  of such water-course  expedient,               he may call upon the applicant to deposit  any               part  of the expense to such officer may  con-               sider  necessary, and upon such deposit  being               made, shall cause inquiry to be made into  the               most  suitable alignment for the  said  water-               course, and shall mark out the land which,  in               his  opinion, it will be necessary  to  occupy               for the construction thereof,               and shall forthwith publish a notification  in               every village through which the  water’-course               is proposed to be taken, that so much of  such               land as is situated within such               377               village has been so marked out,               and shall send a copy of such notification  to               the Collector of every district in which  such               land  is  situated, for  publication  on  such               land.               The said notification shall also call upon any               person who wishes to share in the ownership of               such  water-course to make his application  in               that  respect  to  the  Canal  Officer  within               thirty   days  of  the  publication  of   such

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 10  

             notification.               If   any  such  applicant  appears,  and   his               application is admitted, he shall be liable to               pay  his  share in the  construction  of  such               water-course, and in the cost of acquiring the               land  for the same, and shall be an  owner  of               such water-course when constructed."               Powers of the canal officers are contained  in               Section 77 reads thus                "(1)  For the purpose of the inquiries  under               section  76 such Canal Officer may  enter,  by               himself  or any officer authorised by him  for               the  purpose,  upon any land adjacent  to  any               such work, and may survey, demarcate and  make               a map of the same.               (2)Notwithstanding   anything   contained   in               section  76  where no sufficient  evidence  is               forthcoming  as to all or any of  the  matters               specified  in that section such Canal  Officer               shall, so far as may be, settle and record the               aforesaid  matters  in such manner as  he  may               deem fit."   A  perusal of the record reveal that it was the  Executive Engineer  who  was  doing "pervi" of the case  in  the  suit filed.  in  1966.   The  agreement  (compromise)  Ex.45  was entered  into  during  the pendency of the  said  case.   As already noticed the Government of Gujarat had appointed  all Executive  Engineers and Superintending Engineers  in-charge of  Canals in the State of Gujarat to be Canal  Officers  in respect  of such canals and assigned to them all the  powers and duties of the Canal Officers under the Act by virtue  of the  Notification dated 27th September, 1963.  Thus,  it  is manifest that the Executive Engineer, by virtue of the  said Notification,  had been lawfully appointed as Canal  Officer within the meaning of Section 378 3(6)  of  the Act.  Section 18 of the Act  vests  the  Canal Officer  with  the  power to hold  inquiry  and  direct  the construction  of suitable alignments for a water-course  and by Section 77 of the Act (supra) the Canal Officer is vested with  the authority to survey, demarcate and make a  map  of the  land which in his opinion is suitable for  constructing an   alignment  for  the  water-course.   Thus,  under   the statute,,  read with the Notification dated  27th  September 1963, the Canal Officer (Executive Engineer) was fully  com- petent to decide about the particular alignment of the water course  and  it fell within his jurisdiction to  decide  and settle  about the suitable demarcation of the  alignment  of the water course of the canal from Vartu Dam.  He  exercised that  jurisdiction under the statute when he demarcated  the water  course  in  red, in the map attached  to  Ex.45,  the agreement.   It is the content of the agreement and not  its form  which is relevant to trace the source of power  behind it  and  when  examined  in  the  light  of  the   statutory provisions  noticed above, it is manifest that the  document Ex.45 has been executed by the Executive Engineer by  virtue of  the  statutory powers vested in him.   The  circumstance that  the  agreement Ex.45 came into  existence  during  the pendency of the suit and was executed by way of an agreement does  not  militate  against  the  order  of  alignment   as reflected therein being any less statutory in character.  As a  matter  of fact the Act itself envisages that  the  Canal Officer  may alter and settle the alignment in  consultation with  the landholders through which the water course  is  to run.   In  the agreement Ex.45, the Executive  Engineer  had

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 10  

agreed  to  alter  the  alignment of  the  water  course  in consultation    with   the   petitioners    who    thereupon ,unconditionally’  withdrew  the  suit  as  it  appears   no grievance  remained  to be settled.  The  altered  alignment was,  therefore,  validly made by  following  the  procedure envisaged  by  the  Act.  The High Court fell  in  error  in ignoring  this aspect of the case.  It failed to  appreciate the  statutory powers of the Executive Engineer,  vested  in him  under  Sections  18 and 77 of the  Act  read  with  the notification of 27th September, 1.963 on the true import  of agreement Ex.45. Thus, in the facts and circumstances of the case  we are satisfied that the agreement  dated  7.11.1966, Ex.  45 was lawfully executed by the Executive  Engineer  in exercise of his statutory powers under the Act and the State was  obliged  to  act according to the  terms  of  the  said agreement  and could not give it a go bye without  following the  procedure under the Act to again alter  the  alignment. It  is  nobody’s case that for making an alteration  in  the alignment,   the  requisite  exercise  was  undertaken,   as envisaged by the Act, in 1972, when the suit out of which 379 these proceedings have arisen was filed. In  view  of  the  aforesaid discussion,  the  judgment  and decree  of the High Court deserves to be set aside  and  are hereby  set  aside.  The judgment and decree passed  by  the Trial Court as confirmed by the District Judge are  restored though for different reasons, as detailed above.  The appeal is  consequently allowed.  The parties, however, shall  bear their own costs throughout. Before  parting  with the judgment, we would  also  like  to clarify  certain  position.   The dispute  is  almost  three decades old.  Learned counsel for the parties were unable to state as to whether fresh alignments as envisaged by the red line in the map attached to Ex.45, agreement, had been  made for  the passing of the canal or not.  We would,  therefore, like  to clarify that if any fresh alignment for  the  water course  is  required  to be made,  different  than  the  one originally  proposed or the one contained in the  said  Map, the  same  may be made but only by following  the  procedure prescribed  under  the Act and this judgment  shall  not  be construed as any bar therefore. N.P.V.              Appeal allowed. 380