REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.6580 OF 2008 ARISING OUT OF

SPECIAL LEAVE PETITION (CIVIL) NO. 15449 OF 2004

ESSCO FABS PVT. LTD. & ANR. … APPELLANTS

VERSUS

STATE OF HARYANA & ANR. … RESPONDENTS WITH

CIVIL APPEAL NO.6581 OF 2008 ARISING OUT OF

SPECIAL LEAVE PETITION (CIVIL) NO. 15544 OF 2004 THE PANIPAT TEACHERS (RECOGNISED SCHOOLS)HOUSING CO-OPEATIVE SOCIETY LTD. & ANR.  … APPELLANTS

VERSUS

STATE OF HARYANA & ORS. … RESPONDENTS WITH

CONTEMPT PETITION NO. 30 OF 2007 IN

CIVIL APPEAL NO.6580 OF 2008 ARISING OUT OF

SPECIAL LEAVE PETITION (CIVIL) NO. 15449 OF 2004 ESSCO FABS PVT. LTD. & ANR. … PETITIONERS

VERSUS STATE OF HARYANA & ANR. … RESPONDENTS

J U D G M E N T

C.K. THAKKER, J.

1. Leave granted.

2. Both  these appeals are filed by the

appellants  being  aggrieved  and  dissatisfied

with the judgment and order dated April 02,

2004,  passed  by  the  High  Court  of  Punjab  &

Haryana in Civil Writ Petition Nos. 1853 of

2003 and 2077 of 2002.

3. To  appreciate  the  controversy  raised

in  the  present  appeals,  relevant  facts  in

nutshell may be noted.

4. According to the appellant Essco Fabs

Pvt. Ltd. (‘Essco’ for short), the Government

of Haryana intended to acquire land for public

purpose,  viz.,  for  utilization  of  land  as

residential, commercial and industrial area in

Sector Nos. 11, 12 and 25 Part-II by Haryana

Urban Development Authority (‘HUDA’ for short).

For the said purpose, the Government issued a

notification under sub-section (1) of Section 4

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of the Land Acquisition Act, 1894 (hereinafter

referred to as ‘the Act’) on December 15, 1982.

The  land  mentioned  in  the  said  notification

situated in village Kheri Nangal was sought to

be acquired. A final notification under Section

6  of  the  Act  was  issued  on  June  20,  1984.

However, the land acquisition proceedings could

not be completed within the stipulated period

and the notifications lapsed and the land stood

released.

5. It  was  the  case  of  Essco  that  it

bought the land which was sought to be acquired

earlier  for  expansion  of  its  Export  Unit.

According  the  appellant,  it  is  engaged  in

manufacturing  and  exporting  rugs,  cushions,

bed-spreads, bath mats, fabrics, kitchen towel,

aprons, pot holders, gloves, mitten, curtains,

napkins, carpets, etc. It is Export Oriented

Unit and earns foreign exchange by export of

goods manufactured in its unit. In the year

1992, it exported materials over Rs.2 crores.

The appellant has stated that on June 6, 1991,

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it made an application to the Director, Town &

Country  Planning, Haryana  for permission  for

change of user of land. All necessary documents

were appended to the application. The Director,

however, vide an order dated September 5, 1991,

rejected the permission on several grounds. One

of the grounds weighed with the Director for

refusing the permission was that the land in

question  was  proposed  to  be  acquired.  The

appellant  has  produced  a  copy  of  the

application  as  also  an  order  of  rejection

thereof in the present proceedings. But even

thereafter  no proceedings  for acquisition  of

land were initiated for many years.

6. On  August  1,  2001  i.e.  after  about

twenty years of the first notification of 1982

and nine years after rejection of prayer of the

appellant for change of user, the Government of

Haryana  again issued  notification under  sub-

section  (1)  of  Section  4  of  the  Act  for

acquisition  of  land  for  the  development  and

utilization for construction of road connecting

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Sanauli Road with G.T. Road for Sector 25 Part-

II B, Urban Estate Panipat by HUDA. The land of

the appellant situated in village Kheri Nangal

was sought to be included in the notification.

Moreover, ‘urgency clause’ under Section 17 of

the Act was applied and a valuable right of

raising objections under Section 5-A of the Act

was taken away in an arbitrary manner. On the

very next day  i.e.  on August 2, 2001, final

notification under Section 6 of the Act was

issued by the Government.

7. It is the case of the appellant that

the preliminary notification under sub-section

(1) of Section 4 of the Act was required to be

published in the manner laid down in the Act.

But it had not been published before issuance

of final notification under Section 6 of the

Act.  The  final  notification  was,  therefore,

illegal and the appellant could not be deprived

of his property in a manner not known to law.

The right of the appellant to own, possess and

enjoy the property is not merely a Common Law

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right  but  also  constitutional  right  under

Article 300A of the Constitution which has a

‘flavour of fundamental right’. The acquisition

proceedings, being not in consonance with law

were vitiated and liable to be quashed.

8. The appellant, hence, filed Civil Writ

Petition No. 1853 of 2003 in the High Court of

Punjab & Haryana by invoking Article 226 of the

Constitution praying therein for quashing and

setting aside acquisition proceedings. The High

Court  entertained  the  petition  and  granted

status quo with regard to possession of the

land  in  question.  Finally,  however,  by  the

impugned  judgment it  dismissed the  petition.

The said order is challenged by the appellant

in this Court.

9. The  other  appeal  is  filed  by  the

Panipat Teachers (Recognized Schools) Housing

Co-operative Society Ltd. (‘society’ for short)

challenging the acquisition proceedings. It was

the case of the society that pursuant to the

representation made by the society, the State

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Government released 53 kanals and 8 marlas of

land by executing an agreement dated October

19, 1985 and by granting land in favour of the

society  on  conditions  mentioned  in  the

agreement. Possession of land was handed over

to the society. The land was demarcated and was

carved out into plots reserving requisite space

for school, parks, temple, overhead water tank,

roads, green belt etc. The society got the site

plan designed strictly in accordance with HUDA

Rules.  The  society  invested  huge  amount,

approximately Rs.26 lakhs, for developing the

land laying down sewer pipe lines, RCC Water

pipe lines, construction of roads and boundary

walls etc. The site plan, however, has not been

cleared by the office of the Director, Town &

Country  Planning,  Haryana  despite  numerous

attempts  by  the  appellant-society.  It  is

alleged by the society that the matter was kept

pending for oblique and ulterior purposes on

lame and untenable excuses. It is also stated

by  the  society  that  HUDA  published  public

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notice in ‘Daily Bhaskar’ dated November 10,

2000  demanding  development  charges  thereby

acknowledging that the society’s land has been

rightly  developed  for  teachers’  colony.  The

public  notice  informed  and  instructed  those

land/plot owners who were in arrears to pay all

the balance development charges and outstanding

dues.  No  dues  were  shown  as  against  the

appellant-society. Thus, there is nothing due

and payable to HUDA by the appellant.

10. Ignoring all these material facts and

with a view to cause serious prejudice to the

appellant-society,  a  notification  under  sub-

section (1) of Section 4 of the Act had been

issued by the State for acquisition of land.

11. We have already stated facts relating

to  the issuance  of preliminary  notification,

application of urgency clause under Section 17

and  issuance  of  final  notification  under

Section 6 of the Act while narrating the facts

in the first case of Essco. It is, therefore,

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not necessary to repeat all those facts in the

second matter.

12. The  appellant-society,  in  the

circumstances,  approached  the  High  Court  by

filing Civil Writ Petition No. 2077 of 2002

which was also decided along with the petition

of Essco and the petition of the appellant-

society also came to be dismissed.

13. Third  writ  petition  (Civil  Writ

Petitin No. 3324 of 2003) was filed by M/s Lord

Shiva Exports, Panipat which also met with the

same fate. Lord Shiv Exports, however, has not

approached this Court.

14. Notices were issued by this Court and

interim  relief  was  granted.  Respondents

thereafter  appeared,  affidavits  and  further

affidavits  were  filed  and  the  matters  were

ordered to be posted for final hearing. That is

how the matters are before us.

15. We have heard learned counsel for the

parties.

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16. The learned counsel for the appellants

Essco and Teachers’ society have challenged the

acquisition  on  several  grounds.  It  was

contended  that  the  land  was  not  needed  for

public purpose as set out in the notification

of  2001  and,  hence,  the  acquisition  is  not

legal or lawful. Moreover, initially an action

was taken for acquisition of land before more

than a quarter century in the year 1982. Final

notification was also issued after more than

one and half year of preliminary notification,

but even thereafter, nothing was done by the

State  and  the  proceedings  lapsed.  Again,  in

1991, when Essco applied for change of user of

land, the prayer was turned down, inter alia,

on the ground that the land in question was

proposed  to  be  acquired  for  public  purpose.

Nothing  was  done  by  the  State  for  about  a

decade.  Only  in  August,  2001,  notification

under Section 4 was issued. It was strongly

urged by the learned counsel for the appellants

that  preliminary  notification  was  issued  on

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August 1, 2001 and urgency clause was applied

though  there  was  no  urgency  at  all.  The

notification  was  published  in  the  official

gazette thereafter and in two daily newspapers

on August 10 and 12, 2001. Final notification

under  Section  6,  however,  was  issued

immediately on the next day i.e. on August 2,

2001,  of  the  issuance  of  preliminary

notification under sub-section (1) of Section

4. It was contended that on the facts of the

case,  no  urgency  clause  could  have  been

invoked. Even otherwise, the action was bad and

de hors the Act since the conditions laid down

in sub-section (4) of Section 17 of the Act

have not been complied with inasmuch as there

was  neither  grave  urgency  nor  unforeseen

emergency.  It  was  submitted  that  there  was

lethargy  on  the  part  of  officers  of  the

Government in not taking steps for more than

twenty  years.  The  State  cannot  take  undue

advantage  of  its  negligence  or  inaction  and

deprive the owners of their right to property

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in  purported  exercise  of  power  of  eminent

domain. The Act is an expropriatory legislation

which deprives a person of his property without

his consent. The provisions of the Act, hence,

have to be construed strictly. It was submitted

that Section 5A confers a valuable right on the

owners of land of submitting objections against

proposed acquisition and such right cannot be

taken away or curtailed by the State. On the

facts of the case, invocation of urgency clause

was not only uncalled for being contrary to law

but otherwise arbitrary and unreasonable and on

that ground also, the proceedings are liable to

be quashed. It was urged that the expression

‘the date of publication’ has been defined in

sub-section (1) of Section 4 of the Act. While

construing the said connotation under Section

17, same meaning as contemplated under Section

4(1)  has  to  be  given.  Since  the  final

notification  under  Section  6  had  not  been

published as required by the Act after ‘the

last date of publication’ of notification under

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Section 4(1), the action is unlawful and is

liable to be set aside. It was asserted that no

notice as required by Section 9 of the Act had

been issued nor payment of 80 percent of the

compensation as required by sub-section (3A) of

Section 17 had been paid. There was also total

non-application  of  mind  on  the  part  of  the

State  Government  in  not  considering  the

Government  policy  of  granting  exemption  to

functional  units  dealing  with  handloom  and

other  industries.  On  that  count  also,  the

proceedings are liable to be dropped. 17. On  behalf  of  Teachers’  Society,  the

learned  counsel  adopted  all  the  contentions

raised on behalf of Essco. The learned counsel,

however,  further  submitted  that  the  society

prayed for allotment of land and the prayer was

granted. An agreement was entered into between

the Authority and the society, possession of

land was handed over to the society, which has

spent substantial amount of several lakhs for

development. Necessary permission was sought so

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that construction can be made which was also

granted by the Authorities, requisite charges

which were to be paid had already been paid and

no dues had been shown so far as the appellant-

society  is  concerned  and  yet  the  impugned

action  has  been  taken  mala  fide  and  with

ulterior motive though the land is not required

for public purpose. It was also submitted that

even according to the authorities, the land of

the appellant-society does not come in ‘road

line’. It is situate at about 24 meters away

(23.94  meters)  from  road  line.  It  was,

therefore,  submitted  that  the  proceedings

should be declared against the provisions of

law and may be quashed. 18. Learned  counsel  for  the  respondents,

on the other hand, submitted that the action of

the  authorities  is  legal,  lawful  and  in

consonance with law. It was urged that the land

was  required  for  public  purpose,  viz.,  for

construction of road. For acquisition of land,

therefore, a notification was issued. It was

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submitted  that  there  is  no  element  of  mala

fide  or colourable exercise of power which is

clear  form  the  fact  that  even  in  early

eighties, the land was sought to be acquired.

Since the proceedings could not be completed

within  the  stipulated  period,  they  lapsed.

That, however, does not mean that the land was

not  needed  for  public  purpose  or  that  the

public  purpose  disappeared  or  vanished.  The

counsel  submitted  that  it  was  further  clear

when the prayer of Essco for change of user of

land in 1991 was rejected. The applicant was

told  at  that  time  also  that  the  land  was

required for public purpose. According to the

counsel,  Government machinery  took some  time

but it cannot be concluded that the land was

not required by the State and only with a view

to deprive the appellants of their ownership

rights  acquisition  proceedings  had  been

initiated.

19. Regarding  notification  of  August  1,

2001 and August 2, 2001 under Sections 4 and 6

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of the Act respectively, it was submitted that

both the notifications were in consonance with

law.  A  preliminary  notification  under  sub-

section (1) of Section 4 of the Act was issued

showing  the  intention  of  the  State  for

acquisition of land for public purpose. Since

the acquisition was for construction of road,

it was covered by Section 17 of the Act and

urgency  clause  was  rightly  invoked  and  in

exercise  of  power  under  sub-section  (4)  of

Section 17, inquiry contemplated by Section 5A

of the Act had been dispensed with. The action

was in consonance with law and no grievance can

be  made  contending  that  the  inquiry  as

contemplated  by  Section  5A  and  hearing  of

objections were illegally dispensed with by the

authorities. All actions were consistent with

the provisions of the Act and the appellants

have no right to make complaint against those

actions. It was, therefore, submitted that the

High Court was wholly right in dismissing the

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writ  petitions  and  the  appeals  have  no

substance.

20. Before  we  deal  with  the  matter  on

merits, it would be appropriate if we notice

the  relevant  provisions  of  the  Act.  As  the

Preamble shows, the Act has been enacted with a

view “to amend the law for the acquisition of

land for public purposes (and for Companies)”.

Section 3 is a ‘definition clause’ of various

expressions used in the Act. Clause (f) defines

‘public  purpose’  and  the  definition  is

‘inclusive’  in nature.  Purposes mentioned  in

Clauses  (i)  to  (viii)  are  in  the  nature  of

‘public purpose’ and the land can be acquired

for any such purpose. Part II (Sections 4 to

17) deals with ‘Acquisition’. Section 4 enables

the appropriate Government to issue preliminary

notification for acquisition of land needed or

likely to be needed for public purposes. The

said section is relevant and reads thus;

Section 4 - Publication of preliminary notification  and  powers  of  officers

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thereupon— (1) Whenever it appears to the  appropriate  Government  that  land in any locality is needed or is likely to be needed for any public purpose or for a company a notification to that effect  shall  be  published  in  the Official  Gazette 1[and  in  two  daily newspapers  circulating  in  that locality of which at least one shall be  in the regional language and the Collector shall cause public notice of the substance of such notification to be given at convenient places in the said locality 1[the last of the dates of such publication and the giving of such public notice, being hereinafter referred to as the date of publication of the notification. (2) Thereupon it shall be lawful for any  officer,  either,  generally  or specially  authorised  by  such Government in this behalf, and for his servants and workmen,--

to  enter  upon  and  survey  and  take levels of any land in such locality;

to dig or bore in the sub-soil;

to  do  all  other  acts  necessary  to ascertain whether the land is adapted for such purpose;

to set out the boundaries of the land proposed to be taken and the intended line of the work (if any) proposed to be made thereon;

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to  mark  such  levels,  boundaries  and line  by  placing  marks  and  cutting trenches,

and, where otherwise the survey cannot be completed and the levels taken and the boundaries and line marked, to cut down and clear away any part of any standing crop, fence or jungle:

Provided  that  no  person  shall  enter into any building or upon any enclosed court  or  garden  attached  to  a dwelling-house  (unless  with  the consent  of  the  occupier  thereof) without  previously  giving  such occupier at least seven days' notice in writing of his intention to do so.

21. Section 5A is a salutary provision and

enables any person interested in the land which

is notified under sub-section (1) of Section 4

as being needed or likely to be needed for a

public purpose to lodge objections against the

proposed acquisition. It is equally important

provision and may be reproduced’

Section 5A - Objections : Hearing of objections—(1)  Any  person  interested in  any land which has been notified under section 4, Sub-section (1), as being  needed or likely to be needed for a public purpose or for a company may, within thirty days from the date of  the  publication  of  the

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notification,  object  to  the acquisition of the land or of any land in the locality, as the case may be. (2) Every objection under sub-section (1) shall be made to the Collector in writing, and the Collector shall give the objector an opportunity of being heard  in  person  or  by  any  person authorised by him in this behalf or by pleader and shall, after hearing all such objections and after making such further inquiry, if any, as he thinks necessary,  either  make  a  report  in respect  of  the  land  which  has  been notified under section 4, sub-section (1),  or  make  different  reports  in respect of different parcels of such land,  to  the  appropriate  Government, containing his recommendations on the objections,  together  with  the  record of  the proceedings held by him, for the decision of that Government. The decision of the Appropriate Government on the objections shall be final.

(3) For the purposes of this section, a  person  shall  be  deemed  to  be interested  in  land  who  would  be entitled  to  claim  an  interest  in compensation if the land were acquired under this Act.

22. Then comes Section 6 which authorizes

the  appropriate  Government  to  issue  final

notification as to declaration that the land is

required for public purpose. The said section

is also material and reads as under;

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6. Declaration that land is required for a public purpose.-(1) Subject to the  provisions  of  Part  VII  of  this Act,  when  the  Appropriate  Government is  satisfied  after  considering  the report, if any, made under section 5A, sub-section  (2),  that  any  particular land is needed for a public purpose, or for a company, a declaration shall be  made  to  that  effect  under  the signature  of  a  Secretary  to  such Government  or  of  some  officer  duly authorised  to  certify  its  orders  an different  declarations  may  be  made from  time  to  time  in  respect  of different parcels of any land covered by the same notification under section 4,  sub-section  (!),  irrespective  of whether  one  report  or  different reports  has  or  have  been  made (wherever required) under section 5-A, sub-section (2):

Provided  that  no  declaration  in respect of any particular land covered by  a  notification  under  section  4, sub-section (1),--

(i)  published  after  the  commencement of the Land Acquisition (Amendment and Validation) Ordinance, 1967 but before the  commencement  of  the  Land Acquisition  (Amendment)  Act,  1984 shall  be  made  after  the  expiry  of three  years  from  the  date  of  the publication of the notification; or

(ii) published after the commencement of  the  Land  Acquisition  (Amendment) Act,  1984,  shall  be  made  after  the

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expiry of one year from the date of the publication of the notification:

Provided  further  that  no  such declaration shall be made unless the compensation  to  be  awarded  for  such property is to be paid by a company, or  wholly  or  partly  out  of  public revenues  or  some  fund  controlled  or managed by a local authority.

Explanation 1.-In computing any of the periods  referred  to  in  the  first proviso, the period during which any action  or proceeding to be taken in pursuance  of  the  notification  issued under Section 4, sub-section (1), is stayed by an order of a Court shall be excluded.

Explanation 2.-Where the compensation to be awarded for such property is to be  paid  out  of  the  funds  of  a corporation owned or controlled by the State,  such  compensation  shall  be deemed to be compensation paid out of public revenues.

(2)  Every  declaration  shall  be published in the Official Gazette, and in two daily newspapers circulating in the  locality  in  which  the  land  is situate of which at least one shall be in  the  regional  language,  and  the Collector shall cause public notice of the substance of such declaration to be given at convenient places in the said locality (the last of the date of such  publication  and  the  giving  of such public notice, being hereinafter

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referred to as the date of publication of  the  declaration),  and  such declaration shall state] the district or other territorial division in which the land is situate, the purpose for which  it  is  needed,  its  approximate area, and where a plan shall have been made of the land, the place where such plan may be inspected.

(3)  The  said  declaration  shall  be conclusive evidence that the land is needed for a public purpose or for a Company,  as  the  case  may  be;  and, after  making  such  declaration  the Appropriate Government may acquire the land in manner hereinafter appearing.

23. Section 9 requires issuance of notice

to  persons  interested.  Section  11  requires

enquiry to be made and award to be passed by

Collector. Section 16 authorises the Collector

to take possession of the land acquired under

the Act. Thereupon, the land vests absolutely

in the Government free from all encumbrances.

24. Section  17  is  an  exception  to  the

normal rule of acquisition of land and deals

with  cases  of  urgency  and  emergency.  The

provision is of extreme importance and may be

quoted in extenso.

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17.  Special  powers  in  cases  of urgency.-(1)  In  cases  of  urgency, whenever the Appropriate Government so directs, the Collector, though no such award  has  been  made,  may,  on  the expiration  of  fifteen  days  from  the publication of the notice mentioned in section  9,  sub-section  (1),  take possession of any waste or arable land needed  for  a  public  purpose].  Such land  shall  thereupon  vest  absolutely in  the  Government,  free  from  all encumbrances.

(2)  Whenever,  owing  to  any  sudden change in the channel of any navigable river  or  other  unforeseen  emergency, it becomes necessary for any Railway administration  to  acquire  the immediate possession of any land for the  maintenance  of  their  traffic  or for  the purpose of making thereon a river-side  or  ghat  station,  or  of providing  convenient  connection  with or access to any such station, or the appropriate  Government  considers  it necessary  to  acquire  the  immediate possession of any land for the purpose of maintaining any structure or system pertaining  to  irrigation,  water supply,  drainage,  road  communication or  electricity,]  the  Collector  may, immediately  after  the  publication  of the  notice  mentioned  in  sub-section (1) and with the previous sanction of the appropriate Government, enter upon and  take  possession  of  such  land, which shall thereupon vest absolutely in  the  Government  free  from  all encumbrances.

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Provided that the Collector shall not take  possession  of  any  building  or part  of  a  building  under  this  sub- section without giving to the occupier thereof  at  least  forty-eight  hours' notice of his intention so to do, or such  longer  notice  as  may  be reasonably  sufficient  to  enable  such occupier  to  remove  his  movable property  from  such  building  without unnecessary inconvenience.

(3) In every case under either of the preceding  sub-sections  the  Collector shall at the time of taking possession offer  to  the  persons  interested, compensation  for  the  standing  crops and trees (if any) on such land and for any other damage sustained by them caused  by  such  sudden  dispossession and not excepted in section 24; and, in  case such offer is not accepted, the value of such crops and trees and the amount of such other damage shall be  allowed  for  in  awarding compensation  for  the  land  under  the provisions herein contained.

(3A) Before taking possession of any land  under  sub-section  (1)  or  sub- section  (2),  the  Collector  shall, without prejudice to the provisions of sub-section (3),-

(a)  tender  payment  of  eighty  per centum  of  the  compensation  for  such land  as  estimated  by  him  to  the persons  interested  entitled  thereto, and

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(b) pay it to them, unless prevented by  some  one  or  more  of  the contingencies mentioned in section 31, sub-section  (2),  and  where  the Collector  is  so  prevented,  the provisions of section 31, sub-section (2),  (except  the  second  proviso thereto), shall apply as they apply to the payment of compensation under that section.

(3-B)  The  amount  paid  or  deposited under sub-section (3A), shall be taken into  account  for  determining  the amount of compensation required to be tendered under section 31, and where the  amount  so  paid  or  deposited exceeds  the  compensation  awarded  by the  Collector  under  section  11,  the excess  may,  unless  refunded  within three  months  from  the  date  of  the Collector's award, be recovered as an arrear of land revenue.

(4) In the case of any land to which, in  the  opinion  of  the  appropriate Government,  the  provisions  of  sub- section  (1)  or  sub-section  (2)  are applicable, the appropriate Government may  direct  that  the  provisions  of section 5A shall not apply, and, if it does not so direct, a declaration may be made under section 6 in respect of the land at any time after the date of the  publication  of  the  notification under section 4, sub-section (1).

25. Whereas Part III relates to ‘Reference

to Court and procedure thereon’, Parts IV and V

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deal with ‘Apportionment of compensation’ and

‘Payment’, respectively.

26. It is vehemently contended on behalf

of the appellants that on the facts and in the

circumstances  of  the  case,  the  respondents

could  not  have  invoked  ‘urgency  clause’  by

scuttling enquiry and dispensing with hearing

of objections under Section 5A of the Act. It

was submitted that no action could have been

taken in view of the circumstances mentioned

earlier. As early as in 1982 proceedings were

initiated for acquisition of land but they were

allowed  to  be  lapsed  in  spite  of  final

notification under Section 6 of the Act by not

taking appropriate actions in time. Again, in

1991, when Essco Fabs applied for change of

user of land, request was turned down on the

ground that the land was likely to be needed

for  public  purpose.  It  was,  therefore,

submitted  that  when  preliminary  notification

under Section 4 was issued in 2001, there was

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no urgent need or compelling necessity nor it

was  a  matter  of  urgency  or  emergency  under

Section 17 of the Act which could justify the

action and the proceedings are liable to be

quashed.

27. We  find  considerable  force  in  the

above argument of the learned counsel for the

appellants.  The  scheme  of  the  Act  is  clear

which  provides  for  issuance  of  preliminary

notification under sub-section (1) of Section 4

of  the  Act  empowering  the  appropriate

Government  to  issue  such  notification  for

acquisition  of  land  needed  or  likely  to  be

needed  for  any  public  purpose.  Since  the

property  belongs  to  a  private  individual,

unless there is a ‘public purpose’ as defined

in  clause  (f)  of  Section  3  of  the  Act,  no

acquisition  of  land  can  be  made.  It  is  in

exercise  of  power  of  eminent  domain that  a

sovereign may acquire property which does not

belong  to  him.  In  the  circumstances,  as  a

2

general  rule,  before  exercise  of  power  of

eminent domain, law must provide an opportunity

of  hearing against  the proposed  acquisition.

Even  without  a  specific  provision  to  that

effect,  general  law  requires  raising  of

objections  by  and  affording  opportunity  of

hearing to the owner of the property. The Land

Acquisition (Amendment) Act, 1923 (Act 38 of

1923), however, expressly made such provision

by  inserting  Section  5A  in  the  Act.  It  is,

therefore,  clear  that  after  issuance  of

preliminary notification under Section 4 before

and final notification under Section 6 of the

Act, the appropriate Government is enjoined to

hear persons interested in the property before

he is deprived of his ownership rights. But

then  there  may  be  cases  of  ‘urgency’  or

‘unforeseen  emergency’  which  may  brooke  no

delay  for  acquisition  of  such  property  in

larger  public  interest.  The  Legislature,

therefore, thought it appropriate to deal with

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such cases of exceptional nature and in its

wisdom enacted Section 17.

28. Whereas sub-section (1) of Section 17

deals with cases of ‘urgency’, sub-section (2)

of the said section covers cases of ‘sudden

change in the channel of any navigable river or

other unforeseen emergency’. But even in such

cases  i.e. cases of ‘urgency’ or ‘unforeseen

emergency’, enquiry contemplated by Section 5A

cannot  ipso facto be dispensed with which is

clear from sub-section (4) of Section 17 of

the Act.

29. Sub-section  (4) of Section 17 is an

enabling provision and it declares that if in

the opinion of the appropriate Government, the

provisions  of  sub-section  (1)  or  (2)  are

applicable, it  may direct that the provisions

of  Section  5A  would  not  apply.  It  is,

therefore,  clear  that  the  Legislature  has

contemplated that there may be ‘urgencies’ or

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‘unforeseen  emergencies’  and  in  such  cases,

private properties may be acquired. But, it was

also of the view that  normally even in such

cases,  i.e.  cases of urgencies or unforeseen

emergencies, the owner of property should not

be  deprived  of  his  right  to  property  and

possession  thereof  without  following  proper

procedure of law as contemplated by Section 5A

of the Act unless the urgency or emergency is

of  such  a  nature  that  the  Government  is

convinced that holding of enquiry or hearing of

objections  may  be  detrimental  to  public

interest.

30. In this connection, both the parties

invited our attention to several decisions. We

will deal with some of the important decisions.

31. In  Nandeshwar Prasad & Anr. V. State

of Uttar Pradesh & Ors, (1964) 3 SCR 425, the

land was acquired by the Government for public

purpose,  viz.  the  Kanupur  Development  Board

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under the Kanpur Urban Area Development Act,

1945. The Court considered the scheme of the

Act  that  after  issuance  of  preliminary

notification  under  Section  4  of  the  Act,

objections are to be heard under Section 5A of

the  persons  interested  in  the  property  and

thereafter final notification under Section 6

can be issued. The Court, however, noted that

to that procedure, there is an exception under

Section  17  which  enables  the  Government  to

apply urgency clause. Where an action is taken

under sub-section (4) of Section 17 of the Act,

it is not necessary to follow procedure laid

down  in  Section  5A  and  notification  under

Section 6 can be issued without report from the

Collector as envisaged by Section 5A.

32. The Court stated;

“It will be seen that s. 17(1) gives power to the Government to direct the Collector,  though  no  award  has  been made under s. 11, to take possession of any waste or arable land needed for public purpose and such land thereupon vests  absolutely  in  the  Government free from all encumbrances. If action is  taken  under  s.  17(1),  taking

3

possession  and  vesting  which  are provided  in  s.  16  after  the  award under  s. 11 are accelerated and can take  place  fifteen  days  after  the publication of the notice under s.9. Then  comes  s.  17(4)  which  provides that in case of any land to which the provisions  of  sub-s.  (1)  are applicable, the Government may direct that  the provisions of s. 5-A shall not apply and if it does so direct, a declaration may be made under s. 6 in respect of the land at any time after the  publication  of  the  notification under s. 4(1). It will be seen that it is  not  necessary  even  where  the Government makes a direction under s. 17(1)  that  it  should  also  make  a direction  under  s.  17(4).  If  the Government  makes  a  direction  only under s. 17(1) the procedure under s. 5-A would still have to be followed before a notification under s. 6 is issued,  though  after  that  procedure has been followed and a notification under  s.  6  is  issued  the  Collector gets the power to take possession of the land after the notice under s. 9 without waiting for the award and on such taking possession the land shall vest  absolutely  in  Government  free from all encumbrances. It is only when the  Government  also  makes  a declaration  under  s.  17(4)  that  it becomes  unnecessary  to  take  action under  s.  5-A  and  make  a  report thereunder. It may be that generally where an order is made under s.17(1), an  order  under  s.  17(4)  is  also passed; but in law it is not necessary that this should be so. It will also be  seen  that  under  the  Land

3

Acquisition Act an order under s. 17 (1)  or  s.  17(4)  can  only  be  passed with respect to waste or arable land and it cannot be passed with respect to land which is not waste or arable and on which buildings stand”.

 (emphasis supplied)

33. From  the  above  observations,  it  is

clear  that  even  in  cases  falling  under  or

covered by sub-sections (1) and (2) of Section

17 of the Act and the Government intends to

acquire  land  in  cases  of  ‘urgency’  or

‘unforeseen emergency’, it is still required to

follow procedure under Section 5A of the Act

before  issuance  of  final  notification  under

Section  6  of  the  Act.  It  is  only  when  the

Government also makes a declaration under sub-

section  (4)  of  Section  17  that  it  becomes

unnecessary to take recourse to procedure under

Section 5A of the Act.

34. Nandeshwar  Prasad  was  decided  by  a

three Judge Bench. 35. Recently, in Union of India & Ors. v.

Mukesh  Hans,  (2004)  8  SCC  14,  a  similar

3

question  came  up  for  consideration  before  a

three Judge Bench. There land was sought to be

acquired  at  Mehrauli  by  the  appropriate

Government for organizing  Anjuman-Saire-e-Gul-

Faroshan. Proceedings were initiated under the

Act  and  urgency  clause  was  applied.  The

notification  mentioned the  public purpose  as

‘Planned  Development  of  Delhi’.  It  was  also

stated that Lt. Governor was of the opinion

that Section 17(1) of the Act was applicable to

the  acquisition  and  he  directed  to  dispense

with  inquiry  under  Section  5A  of  the  Act.

Simultaneously, a declaration under Section 6

was  issued. Intrested  parties approached  the

High Court of Delhi, inter alia, on the ground

that  decision  to  dispense  with  inquiry

contemplated  by  Section  5A  of  the  Act  was

vitiated by non-application of mind. The High

Court  upheld  the  contention  and  quashed  the

proceeding. The aggrieved Union approached this

Court.

3

36. It  was  contended  on  behalf  of  the

Union that in case of urgency, it was open to

the  appropriate  Government  to  dispense  with

inquiry  under  Section  5A  by  invoking  sub-

section (4) of Section 17 of the Act. It was

also contended that the urgency contemplated by

sub-sections (1) or (2) of Section 17 of the

Act was ‘by itself’ sufficient to invoke sub-

section (4) of Section 17. 37. Negativing  the  contention  and

referring  to  Nandeshwar  Prasad  and  other

judgments, the Court held;

“A careful perusal of the above Section shows that Sub-section (1) of Section 17  contemplates  taking  possession  of the  land  in  the  case  of  an  urgency without making an award but after the publication of Section 9(1) notice and after  the  expiration  of  15  days  of publication  of  Section  9(1)  notice. Therefore  it  is  seen  that  if  the appropriate  Government  decides  that there is an urgency to invoke Section 17(1) in the normal course Section 4(1) notice  will  have  to  be  published, Section 6 declaration will have to be made and after completing the procedure contemplated under Sections 7 and 8, 9 (1) notice will have to be given and on expiration of 15 days from the date of

3

such  notice  the  authorities  can  take possession  of  the  land  even  before passing of an award.

Sub-section  (2)  of  Section  17 contemplates  a  different  type  of urgency  inasmuch  as  it  should  be  an unforeseen  emergency.  Under  this Section  if  the  appropriate  Government is  satisfied  that  there  is  such unforeseen  emergency  the  authorities can  take  possession  of  the  land  even without  waiting  fort  15  days  period contemplated  under  Section  9(1). Therefore,  in  cases,  where  Government is satisfied that mere is an unforeseen emergency it will have to in the normal course,  issue  a  Section  4(1) notification,  hold  5A  inquiry,  make Section  6  declaration,  and  issue Section 9(1) notice and possession can be taken immediately thereafter without waiting  for  the  period  of  15  days prescribed  under  Section  9(1)  of  the Act.

Section  17(4)  as  noticed  above provides  that  in  cases  where  the appropriate Government has come to the conclusion that there exists an urgency or  unforeseen  emergency  as  required under  Sub-sections  (1)  or  (2)  of Section  17  it  may  direct  that  the provisions  of  Section  5A  shall  not apply  and  if  such  direction  is  given then 5A inquiry can be dispensed with and  a  declaration  may  be  made  under Section  6  on  publication  of  4(1) notification possession can be made”.

3

38. The  Court,  therefore,  proceeded  to state;

“A  careful  perusal  of  this  provision which  is  an  exception  to  the  normal mode of acquisition contemplated under the Act shows mere existence of urgency or  unforeseen  emergency  though  is  a condition  precedent  for  invoking Section  17(4)  that  by  itself  is  not sufficient  to  direct  the  dispensation of 5A inquiry. It requires an opinion to  be  formed  by  the  concerned government  that  along  with  the existence of such urgency or unforeseen emergency  there  is  also  a  need  for dispensing  with  5A  inquiry  which indicates that the Legislature intended that  the  appropriate  government  to apply its mind before dispensing with 5A inquiry. It also indicates the mere existence of an urgency under Section 17(1)  or  unforeseen  emergency  under Section 17(2) would not by themselves be  sufficient  for  dispensing  with  5A inquiry. If that was not the intention of the Legislature then the latter part of Sub-section (4) of Section 17 would not  have  been  necessary  and  the Legislature  in  Section  17(1)  and  (2) itself could have incorporated that in such situation of existence of urgency or  unforeseen  emergency  automatically 5A inquiry will be dispensed with. But then  that  is  not  language  of  the Section which in our opinion requires the  appropriate  Government  to  further consider the need for dispensing with 5A inquiry in spite of the existence of unforeseen  emergency.  This understanding  of  ours  as  to  the

3

requirement of an application of mind by  the  appropriate  Government  while dispensing  with  5A  inquiry  does  not mean mat in and every case when there is  an  urgency  contemplated  under Section 17(1) and unforeseen emergency contemplated under Section 17(2) exists that  by  itself  would  not  contain  the need for dispensing with 5A inquiry. It is possible in a given case the urgency noticed  by  the  appropriate  Government under Section 17(1) or the unforeseen emergency  under  Section  17(2)  itself may  be  of  such  degree  that  it  could require  the  appropriate  Government  on that  very  basis  to  dispense  with  the inquiry under Section 5A but then there is a need for application of mind by the appropriate Government that such an urgency  for  dispensation  of  the  5A inquiry is inherent in the two types of urgencies contemplated under Section 17 (1) and (2) of the Act”.

39. The learned counsel for the respondent

authorities,  however, strongly  relied upon  a

two Judge Bench decision of this Court in Jai

Narain & Ors. v. Union of India & Ors., (1996)

1 SCC 9. In Jai Narain, the Court held that the

question of ‘urgency’ or ‘unforeseen emergency’

is  the  mater  which  is  entirely  based  on

‘subjective satisfaction of the Government’ and

the Courts do not interfere unless the reasons

3

given are wholly irrelevant and there is non-

application of mind. If the public purpose, on

the face of it shows that the land is needed

urgently,  that  by  itself  is  relevant

circumstance  for justifying  the action  under

Section 17(4) of the Act.

40. Again, a similar view was taken by a

two Judge Bench in  Chameli Singh & Ors., v.

State of U.P. & Anr.,  (1996) 2 SCC 549. In

Chameli  Singh,  land  was  acquired  for  public

purpose,  namely,  construction  of  houses  for

dalits.  Urgency  clause  under  Section  17  was

applied  which  was  challenged  by  the  land-

owners.  Holding  that  the  urgency  clause  was

rightly applied and inquiry under Section 5A of

the Act has been correctly dispensed with, the

Court  observed  that  acquisition  of  land  for

providing  houses  to  dalits,  tribes  and  poor

would be sufficient to invoke Section 17 of the

Act and the land-owners cannot challenge the

validity of such acquisition on the ground that

4

inquiry under Section 5A cannot be dispensed

with.

41. The Court stated;

“It would thus be seen that this Court emphasised the holding of an inquiry on the facts peculiar to that case. Very often the officials, due to apathy in implementation  of  the  policy  and programmes  of  the  Government, themselves  adopt  dilatory  tactics  to create cause for the owner of the land to challenge the validity or legality of the exercise of the power to defeat the  urgency  existing  on  the  date  of taking decision under Section 17(4) to dispense with Section 5-A inquiry.

It  is  true  that  there  was  pre- notification  and  post-notification delay on the part of the officers to finalise and publish the notification. But those facts were present before the Government  when  it  invoked  urgency clause and dispensed with inquiry under Section 5A. As held by this Court, the delay  by  itself  accelerates  the urgency: Larger the delay, greater be the urgency. So long as the unhygienic conditions and deplorable housing needs of Dalits, Tribes and the poor are not solved  or  fulfilled,  the  urgency continues  to  subsist  When  the Government  on  the  basis  of  the material,  constitutional  and international  obligation,  formed  its opinion  of  urgency,  the  Court,  not

4

being  an  appellate  forum,  would  not disturb  the  finding  unless  the  court conclusively finds the exercise of the power male fide. Providing house sites to  the  Dalits,  Tribes  and  the  poor itself  is  a  national  problem,  and  a constitutional  obligation.  So  long  as the problem is not solved and the need is not fulfilled, the urgency continues to  subsist.  The  State  is  expending money to relieve the deplorable housing condition  in  which  they  live  by providing decent housing accommodation with  better  sanitary  conditions.  The lethargy  on  the  part  of  the  officers for  pre  and  post-notification  delay would  not  render  the  exercise  of  the power to invoke urgency clause invalid on that account”.

42. In First Land Acquisition Collector &

Ors., v. Nirodhi Prakash Gangoli & Anr., (2002)

4 SCC 160, a two Judge Bench again observed

that case of existence of urgency under Section

17  of  the  Act  is  a  matter  of  subjective

satisfaction  of appropriate  Government and  a

decision of Government to dispense with inquiry

under Section 5A by invoking urgency provision

can be challenged only on the ground of non-

application of mind or  mala fide  exercise of

power by the Government.  Burden is always on

4

the person alleging  mala fide  to prove it on

the basis of specific materials.  So long as the purpose of acquisition continues to exist,

exercise of power under Section 17 cannot be

held  to  be  mala  fide. Mere  delay  of  the

Government  subsequent  to  its  decision  to

dispense  with  inquiry  under  Section  5A  by

exercising  power  under  Section  17  would  not

invalidate the decision.

43. On  the basis of above decisions, it

was submitted that once a decision has been

taken by the State Government to apply urgency

clause, the decision of the Government cannot

be interfered with by a Court exercising writ

jurisdiction.

44. In  our  judgment,  from  the  above  case

law,  it  is  clear  that  normal  rule  for

acquisition of land under the Act is issuance of

notification under sub-section (1) of Section 4,

hearing  of  objections  under  Section  5A  and

4

issuance of final notification under Section 6

of  the  Act.   Award  will  be  made  by  the

Collector, notice has to be issued to the land-

owners or the person interested and thereafter

possession can be taken. Section 17, no doubt,

deals  with  special  situations  and  exceptional

circumstances  covering  cases  of  ‘urgency’  and

‘unforeseen  emergency’.  In  case  of  ‘urgency’

falling under sub-section (1) of Section 17 or

of ‘unforeseen emergency’ covered by sub-section

(2)  of  Section  17,  special  powers  may  be

exercised by appropriate Government but as held

by  a three Judge Bench decisions  before more

than  four  decades  in  Nandeshwar  Prasad  and

reiterated by a three Judge Bench decision in

Mukesh  Hans,  even in such  cases, inquiry and

hearing of objections under Section 5A cannot

ipso  facto be  dispensed  with  unless  a

notification under sub-section (4) of Section 17

of the Act is issued. The legislative scheme is

amply clear which merely enables the appropriate

Government to issue such notification under sub-

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section (4) of Section 17 of the Act dispensing

with inquiry under Section 5A if the Government

intends to exercise the said power. The use of

the  expression  ‘may’  in  sub-section  (4)  of

Section 17 leaves no room of doubt that it is

discretionary power of the Government to direct

that  the  provisions  of  Section  5A  would  not

apply to such cases covered by sub-section (1)

or (2) of Section 17 of the Act.

45. In  our  opinion,  therefore,  the

contention  of  learned  counsel  for  the

respondent authorities is not well founded and

cannot be upheld that once a case is covered by

sub-section (1) or (2) of Section 17 of the

Act,  sub-section  (4)  of  Section  17  would

necessarily apply and there is no question of

holding  inquiry  or  hearing  objections  under

Section  5A  of  the  Act.  Acceptance  of  such

contention or upholding of this argument will

make  sub-section  (4)  of  Section  17  totally

otiose, redundant and nugatory.

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46. It is true that in  Chameli Singh  and

Jai Narain, a two Judge Bench has observed that

acquisition of land for housing accommodation

or for construction of residential quarters for

dalits and tribals can be said to be of an

urgent nature falling under Section 17(1) of

the  Act.  But  as  already  held  in  Nandeshwar

Prasad  and  Mukesh Hans,  even in such cases,

procedure required to be followed under Section

5A cannot be dispensed with unless notification

under sub-section (4) of Section 17 is issued.

In  Mukesh Hans, the Court also held that the

provision  cannot  be  pressed  in  service  by

officers who were negligent and due to their

lethargy,  proceedings could  not be  initiated

for a quite long time.

47. In  the  instant  case,  the  facts  are

eloquent. Initial action of acquisition of land

was  taken  as  early  as  in  1982  but  the

proceedings lapsed. In 1991, when Essco made an

application praying for change of user of land,

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it was rejected on the ground that the land was

likely  to  be  required  for  public  purpose.

Nothing, however, was done for about a decade.

It  is  only  in  2001  that  again  Notification

under Section 4 was issued and urgency clause

was applied. We are, therefore, satisfied that

the  ratio  lad  down  in  Mukesh  Hans squarely

applies to the facts of the case. No urgency

clause  could  have  been  invoked  by  the

respondents  and  inquiry  and  hearing  of

objections provided by Section 5A of the Act

could not have been dispensed with. The actions

of issuance of urgency clause under sub-section

(4)  of  Section  17,  dispensing  with  inquiry

under  Section  5A  and  issuance  of  final

notification under sub-section (1) of Section 6

are  required  to  be  quashed  and  they  are

accordingly quashed.

48. The learned counsel for the appellant

also contended that even if it is held that the

respondent could have issued final notification

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without  holding  inquiry  and  hearing  of

objections under Section 5A of the Act, the

notification  under  Section  6  of  the  Act  is

illegal and unlawful in view of the fact that

the said notification has not been issued after

the last of the dates of the publication and

giving of public notice referred to as “the

date of publication of the notification” under

sub-section (1) of Section 4 of the Act.

49. It  was submitted that even the said

point is concluded by a decision of this Court

in  State  of  Uttar  Pradesh  &  Ors.  v.  Radhey

Shyam Nigam & Ors, (1989) 1 SCC 591.

50. The  learned  counsel  for  the

respondents,  on  the  other  hand,  relying  on

State  of  Haryana  &  Anr.  v.  Raghubir  Dayal,

(1995) 1 SCC 133 and Mohan Singh & Ors. v.

International  Airport  Authority  of  India  &

Ors.,  (1997)  9  SCC  132  submitted  that  if

urgency clause under Section 17(4) is applied

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by  the  appropriate  Government,  final

notification under Section 6 of the Act can be

issued  on  the  next  day  of  the  issuance  of

preliminary notification under Section 4 of the

Act. In the case on hand, the said procedure is

followed.  Notification  under  Section  4  was

issued on August 1, 2001. Urgency clause was

applied and the case was covered by Section 17

(4) of the Act. On the very next day  i.e. on

August  2,  2001,  final  notification  under

Section 6 was issued. Therefore, the procedure

required by law has been strictly followed as

held by this Court in Raghubir Dayal and Mohan

Singh.

51. We  would have entered into the said

question had it been absolutely necessary for

us to decide it in the case on hand. But as

observed hereinabove, we are of the view that

the appellants are entitled to succeed on the

first  ground  that  on  the  facts  and  in  the

circumstances  of  the  case,  the  appropriate

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Government  was  not  justified  in  invoking

urgency clause under sub-section (4) of Section

17 of the Act by dispensing with inquiry and

hearing of objections under Section 5A of the

Act  and  the  final  notification  issued  under

Section 6 of the Act deserves to be set aside

on that ground alone, we express no opinion one

way or the other on the interpretation of the

expression  “the  date  of  publication  of  the

notification”  used  in  sub-section  (1)  of

Section 4, sub-section (4) of Section 17 and

Section 6 of the Act.

52. For  the  foregoing  reasons,  both  the

appeals  are  allowed.  The  action  of  the

respondent  authority  of  dispensing  with  the

inquiry and hearing of objections under Section

5A  and  issuance  of  final  notification  under

Section 6 of the Act is hereby quashed and set

aside. It is, however, open to the authorities

to  take  appropriate  action  after  following

normal procedure laid down in the Act.

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53. Appeals  are  accordingly  allowed  with costs.

CONTEMPT PETITION NO.30 OF 2007 IN C.A.NO. …………… OF 2008   @   S.L.P. (C)NO. 15449 OF 2004   

54. In  the  light  of  judgment  in  the  above

appeals, the contempt petition stands disposed of.

…………………………………………………J. (C.K. THAKKER)

NEW DELHI, …………………………………………………J. NOVEMBER 07, 2008. (D.K. JAIN)

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