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PETITIONER: NEELAGANGABAI AND ANR.

       Vs.

RESPONDENT: STATE OF KARNATAKA AND ORS.

DATE OF JUDGMENT03/05/1990

BENCH: SHARMA, L.M. (J) BENCH: SHARMA, L.M. (J) PUNCHHI, M.M.

CITATION:  1990 AIR 1321            1990 SCR  (3)  20  1990 SCC  (3) 617        JT 1990 (2)   330  1990 SCALE  (1)102

ACT:     Land  Acquisition  Act,  1894: Sections 18  and  20  (As applicable to State of Karnataka)--Land Acquisition--Compen- sation--Reference   to  Court--Determination  of   reference without  notice  to  authority  for  Whom  acquisition   was made--Validity of.

HEADNOTE:     Consequent  to the acquisition of the  appellant’s  land for meeting the requirements of the  respondent-Corporation, a reference was made to the Civil Court, under section 18 of the Land Acquisition Act, 1894, when was determined  without notice to the respondent-Corporation. and by allowing higher compensation to the appellants.     The  State preferred an appeal against the  decision  of the  Civil  Court which was dismissed  and  the  respondent- Corporation’s intervention in the appeal was not allowed.     Thereafter  the  respondent-Corporation  filed  a   writ petition  challenging  the  validity of  the  Civil  Court’s judgment. The High Court set aside the award of compensation and directed the Civil Court to re-open the proceedings. Dismissing the appellant’s appeal, this Court,     HELD:  1. In view of the clear language used  in  clause (c)  of section 20 of the Land Acquisition Act,  1894  there cannot  be  any doubt that  the  respondent-Corporation  was entitled  to be heard before the reference could  be  deter- mined. [22H]     Himalayan  Tiles and Marbles (P) Ltd.  v. Francis Victor Coutinho, [1980] 3 SCR 235, referred to.     2.  The  land  was  acquired  for  the  purpose  of  the respondent  Corporation,  and  the  burden  of  payment   of compensation  is  on the Corporation.  Therefore,  the  High Court’s  view  that  it  was  mandatory  for  the  Court  of reference  to  have  caused a notice to  be  served  on  the respondent-Corporation  is  correct. Non-service  of  notice deprived the 21 Corporation  of an opportunity to place its case before  the Court,  and the judgment so rendered in the  reference  case was  illegal and not binding on the  respondent-Corporation. [22D-E]

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   3. The High Court’s direction to the Civil Judge to  re- open  the  proceedings and decide the  matter  afresh  after giving the Corporation a chance to lead its evidence on  the question of valuation is confirmed. [23B]

JUDGMENT:     CIVIL  APPELLATE JURISDICTION: Civil Appeal No. 1561  of 1988.     From the Judgment and Order dated 4.3.1987 of the Karna- taka High Court in W.P. No. 10292 of 1980. N.D.B. Raju and N. Ganpathy for the Appellant.     Mohan Katarki, Rajeshwar Thakur, Ms. C.K. Sucharita  and P.R. Ramasesh for the Respondents. The Judgment of the Court was delivered by     SHARMA,  J.  This appeal by special  leave  is  directed against  the judgment of the High Court of  Karnataka  dated 4.3.1987  in W.P. No. 10292 of 1980 filed by the  respondent No. 3, HubIi Dharwar Municipal Corporation, setting aside an award  made under the Land Acquisition Act, 1897 in  respect of  the compensation payable to the present  appellants  and directing  to re-open the proceeding before the civil  court on a reference under s. 18 of the Act, for fresh disposal in accordance  with law. The appellants were the owners of  the land  in  question.  In a proceeding under  the  Urban  Land (Ceiling and Regulation) Act, 1976, the appellants were held to be having surplus land, which by virtue of the provisions of  the Act vested in the State Government. However,  before the publication of the aforesaid declaration in the official gazette,  steps for acquisition were taken for  meeting  the requirements  of the respondent-Corporation. The  appellants thus escaped the consequences of the declaration made  under the  Ceiling  Act, and became entitled to  the  compensation payable in accordance with the provisions of the Land Acqui- sition  Act. Steps were accordingly taken for  determination of the compensation, and on an application by the appellants under s. 18 of the Land Acquisition Act, reference was  made to the civil court. 2.  It  is common ground that after the  case  was  received by the 22 civil  court  on  reference, no notice  was  issued  to  the respondent Corporation. The court did not, however,  proceed to  take  evidence  and  record  its  own  finding  on   the valuation,  as  it  was  conceded on  behalf  of  the  State Government  that  the  market value of  the  land  could  be calculated  at  the rate of Rs.3,800 per guntha.  The  court answered  the reference on the basis of the consent  of  the land  owners  and  the State. The State,  however,  was  not satisfied  with  the  award and filed an  appeal  which  was dismissed  on  ground  of  being  not  maintainable  as  the impugned  Judgment  was held to be a compromise  decree.  An attempt  by  the respondent-Corporation  to  intervene  also failed. The Corporation thereafter moved the High Court with a  writ  petition under Article ’226  of  the  Constitution, inter  alia, challenging the validity of the civil  court.’s judgment directing higher compensation to be paid.     3.  Admittedly the land was acquired for the purpose  of the respondent-Corporation and the burden of payment of  the compensation  is on the Corporation. In this background  the High  Court has held that it was mandatory for the court  of reference to have caused a notice served on the  respondent- Corporation before proceeding to determine the  compensation claim.   Since  no  notice  was  given  to  the   respondent

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Corporation  and it was thus deprived of an  opportunity  to place  its case before the court, the judgment  rendered  in the  reference  case  was illegal and  not  binding  on  the Corporation. We are in agreement with this view. Section  20 of  the Land Acquisition Act as applicable to the  State  of Karnataka reads as follows:        "20.  Service of notice.--The Court  shall  thereupon cause  a notice, specifying the day on which the Court  will proceed  to  determine the reference,  and  directing  their appearance before the Court on that day, to be served on the following persons, namely: (a) the Deputy Commissioner; (b) all persons interested in the reference; and       (c) if the acquisition is not made for Government, the person or authority for whom it is made." In  view of the clear language used in clause (c) of s.  20, mentioned above, there cannot be any doubt that the respond- ent-Corporation  was entitled to be heard before the  refer- ence could be determined. 23 The High Court has also relied upon the decision in Himalay- an  Tiles  and Marbles (P) Ltd. v. Francis  Victor  Coutinho (dead)  by  Lrs. and others, [1980] 3 SCR 235,  wherein  the expression "person interested" was interpreted liberally  so as  to  include  an authority like the  Corporation  in  the present case, but in view of the further provision  specifi- cally  mentioning in clause (c) the authority for  whom  the acquisition is made it is not necessary to interpret  clause (b)  of s. 20 in the present appeal. We accordingly  confirm the direction of the High Court as contained in the impugned judgment  that the Principal Civil Judge, Hubli, should  re- open  the  proceedings in the L.A. Case No. 64 of  1979  and decide  the  matter afresh after giving  the  Corporation  a chance  to lead its evidence on the question  of  valuation. Since  the matter is an old one, the  respondent-Corporation is hereby directed to appear in the said case within 3 weeks from  today  without  waiting for any  further  notice.  The appeal is dismissed with costs. T.N.A.                                        Appeal    dis- missed. 24