09 May 1996
Supreme Court


Case number: C.A. No.-007873-007873 / 1996
Diary number: 18614 / 1995
Advocates: Vs S. NARAIN & CO.






DATE OF JUDGMENT:       09/05/1996


CITATION:  1996 SCC  (4) 579        JT 1996 (5)   114  1996 SCALE  (4)340



JUDGMENT:                       J U D G M E N T K.Venkataswami,J.      Leave granted.      Heard learned counsel. Perused the written submissions.      These  appeals   -  one   by  the   State  of   Gujarat [S.L.P.(C)No.27350/95]  and   the  other   by  the  Reliance Petroleum Limited  [S.L.P.(C) NO.27230/95]  arise out of the judgment and  order of  the Gujarat  High  Court  dated  5th September, 1995 in Special Civil Application No. 13525/94.      By the judgment under appeal the High Court has quashed (a) the  notification issued  under section 4(1) of the Land Acquisition Act thereinafter referred to as "the Act") dated 15.2.1993, (b) the declaration issued under section 6 of the Act dated  18.5.1994 and  (c) the  award passed  on 12.12.94 insofar as they related to the lands of the writ petitioners and other  objectors (totalling  89 in  number) belonging to villages Padana and Meghpur.      At the  instance  of  the  appellant  in  Civil  Appeal arising out of S.L.P.(C) NO.27230/95 (hereinafter called the "appellant company")  machinery under  Land Acquisition  Act was put  into operation  under  Part  VII  of  the  Act  for acquiring approximately  an extent  of 2,500  acres of lands situated in  the villages  of Moti  Chavdi, Padana, Meghpur, Lalpur, Sikka  and Gagva.  Before the  High Court  the lands measuring  about  877  acres  belonging  to  89  individuals situated in  Padana and  Meghpur was  the subject matter. It appears in  between (namely  when  the  matter  was  pending before the High Court and the matter was heard and concluded in this  Court) the appellant Company was able to settle the matter with  70 individuals,  leaving 19 individuals holding an extent  of 241.34  acres for settling the issue. In other words we are concerned now with the lands situated in Padana and Meghpur  villages belonging  to 19 individuals measuring 241.34 acres only.      Before the  High Court  the  writ  petitioners  (namely



Respondents 1  to 3  in Civil  Appeal arising  out of S.L.P. (C)No.27230/95) raised  only three  contentions.  They  were that there was non-compliance of the provisions of Rule 3 of the Land Acquisition (Companies) Rules. 1969, that there was non-compliance of provisions of Rule 4 of the said Rules and that there  was no  hearing as  required  was  afforded  and thereby there  was violation of the provisions of Section 5A of the Act. The learned Judges impressed by the arguments of the writ  petitioners accepted  the above  three contentions and consequently  quashed  the  notification  under  section 4(1). declaration  under section  6 and  awards passed under the Land Acquisition Act as mentioned above at the outset.      Aggrieved by  the judgment  of  the  High  Court  these appeals by special leave have been preferred.      Mr. Ashok  Desai, learned  Senior Counsel appearing for the appellant  Company submitted  that the High Court on the facts of  the case  ought not  to have  entertained the writ petition under  Article 226  of the  Constitution  of  India especially when  the object  of the  petitioners before  the High Court  was for  getting an  unrealistic price for their lands.  He   also  submitted   that  their  conduct  in  not challenging the  legality and validity of notification under section  4(1)   declaration  under  section  6  of  the  Act immediately after  their publications and they having waited till the award was passed and finding that the award was not to their  satisfaction and filing reference under section 18 of the  Act, disentitles  them from  moving the  High  Court under Article  226 of  the Constitution. Such conduct on the part of the writ petitioners should have been taken due note of by  the High  Court for  rejecting the  relief.  He  also brought to  our notice  one factual  position that out of 89 persons who  challenged the  land  acquisition  proceedings, only 19  are in  the field  and the  rest have  accepted the compensation (of  course higher  amount than the one awarded by the  Land Acquisition  Officer) and  that shows  that the sole  object  of  the  petitioners  before  the  High  Court (respondents nos.  1 to 3 herein) was to get the unrealistic price. In  support of  this he also invited our attention to paragraph 4  of the  written submissions  filed on behalf of the respondents  Nos. 1  to 3.  In the  written  submissions filed  on   behalf  of   the  appellant   Company,   it   is categorically stated that the Company is prepared to pay the same compensation  as paid  to other  persons at the rate of Rs. 43750/-  for non  irrigated  lands  and  Rs.87500/-  for irrigated lands.  It is  also pointed out that these amounts are higher  than the one demanded by the writ petitioners in their letter dated 25.10.1994. In the concluding part of the written  submissions  an  alternative  offer  also  is  made stating that  if necessary  the Company  is prepared to give alternative lands  out of  the  lands  acquired  to  the  19 individuals who  are  now  disputing  the  land  acquisition proceedings, No  doubt the  learned counsel  also  contended that  the  authorities  concerned  have  complied  with  the formalities required  under  Rules  3  and  4  of  the  Land Acquisition  (Companies)  Rules  and  also  the  formalities required under  section 5A  of the Act. He also cited number of judgments of this Court to support his contentions.      Mr. Shanti  Bhushan, learned  Senior Counsel  appearing for the  land owners  (respondents Nos.  1 to  3) c  the  19 individuals while replying submitted that the Company having not responded to the offer made by the land owners by letter dated 25.10.1994  cannot place  any reliance  at this stage. The land  owners/respondents on the basis of the judgment of the High  Court are  entitled to  the present  market  value which is  about Rs.7  lakhs per  acre and  if this amount is



paid now they will accept the same and give up their further claims. According  to the learned counsel as per decision of this Court,  compliance of  requirement of  Rules 3 and 4 of the Land  Acquisition (Companies)  Rules as well as personal hearing under section 5A are mandatory and non-compliance of the same  as factually  found by  the High  Court cannot  be cured  and  therefore,  the  High  Court  was  justified  in entertaining the  case under  Article 226  and quashing  the proceedings. He  also cited number of authorities in support of his submission.      We have carefully gone through the relevant records and considered the  submissions both oral and written and we are of the  view that on the facts which cannot be disputed, the High  Court  ought  not  have  exercised  its  discretionary jurisdiction and  quashed the  notification, declaration and award under the Land Acquisition Act.      The facts  which cannot  be disputed are the following. The notification  under section  4 dated 15.2.1993, which is the first  step  to  initiate  proceedings  under  the  Land Acquisition Act,  was issued on 11.3.1993. After the inquiry under section  SA, (we  proceed on the assumption that there was no  strict compliance  of the  requirements) declaration under section  6  was  published  on  18.5.1994.  Thereafter individual notices under section 9 were issued on 12.8.1994. In response  to notices under section 9 claims were filed by the land  owners  including  respondents  Nos.  1  to  3  on 5.9.1994. Apart from that on 7.9.1994 a letter was addressed to  the  Land  Acquisition  Officer  on  behalf  of  the  89 individuals which included respondents 1 to 3 informing that the claims  were filed  on behalf of the 89. When the matter was pending  before the  Land Acquisition Officer and before an award  was passed  respondents Nos. 1 to 3 for themselves and on behalf of 89 persons addressed a letter on 25.10.1994 stating that  they have  no objection  to the acquisition of land but  they wanted only compensation as demanded therein. In fact they have given figures which ranged between 37500/- to 87000-  per acre.  However, the appellant company did not take advantage  of that  offer by  responding to  the  same. Subsequently, on 12.12.1994 the Land Acquisition officer has passed the  award and on the same date notices under section 12(2) were  also issued  to the  individuals. It  is claimed major portion  of  the  land  was  taken  possession  of  on 19.12.1994. It  is, therefore,  only on  20.12.1994  Special Civil Application No. 13525/94 was filed by respondents Nos. 1 to  3  on  behalf  of  89  persons  challenging  the  Land Acquisition proceedings.      From the  above facts  which cannot be disputed as they were taken  from records, it would be clear that respondents Nos. 1  to 3  (writ petitioners  before the High Court) took their chance  in the  Award Proceedings and finding that the compensation as claimed by them was not given have moved the High Court.  If really  their intention was to challenge the acquisition as  such they  could have  done  immediately  at least after  the publication  of declaration under section 6 or immediately  after they  received notices under section 9 of the Land Acquisition Act. This shows that the only object of the writ petitioners was to get the maximum price for the land  acquired.   No  doubt   they  are   entitled  to   the compensation as provided under the Land Acquisition Act. For that there  is a separate procedure under the Act itself. As a matter  of fact  out of  19 individuals who are before us, represented by  respondents Nos. 1 to 3, it is common ground 17 have already sought reference under section 18 of the Act claiming more  compensation. Further,  it is  stated in  the written submission  filed on behalf of respondents Nos. 1 to



3 as under :      "It may be pointed out that some of      the land  owners, as  was stated by      the counsel  for the  company, have      entered into  settlement  with  the      company  and   have  accepted   the      compensation. Evidently  they  will      not be  entitled to  the benefit of      the High  Court judgment.  However,      it has  been stated in a note given      to the Court by the company that 19      persons owning  241.34 acres of the      land sought to be acquired have not      entered into  any  settlement  with      the company.  The result  would  be      that the  Government would  have no      authority  to  take  possession  of      these    lands     without    fresh      acquisition  proceedings.   It  was      stated   on    behalf   of    these      respondents that the present market      value of the land was about 7 lakhs      per   acre   and   therefore,   the      compensation for  the  said  241.34      acres would  come  to  about  Rs.17      crores. It  was further  stated  on      behalf of  the respondents  that if      the company  is  willing  to  agree      that   these   persons   would   be      entitled  to  receive  compensation      according  to   the  market   value      prevalent on  the date  of  Supreme      Court’s judgment  in this  SLP, the      respondents  would  be  willing  to      accept the same."      Taking note  of all  these facts  we have  come to  the conclusion  that   the  High  Court  was  not  justified  in entertaining the  writ petition  and also  in exercising the discretionary jurisdiction  to quash  the 4(1) notifications section  6   declaration  and  award  made  under  the  Land Acquisition Act.      In the view we take on the facts of the case, we do not think it  necessary to  discuss the  question of  law and to quote the cases cited by counsel on both sides.      Notwithstanding the above, we feel that ends of justice would be  met if  we direct the appellant company to pay the enhanced compensation  at the  rate/rates paid to others who have accepted  the same  and withdrew  from prosecuting  the case in  this Court, with interest @ 12% from 25.10.1994. If an affidavit  is filed on behalf of the 19 persons accepting the above compensation in full quit within 8 weeks from this date, the  same should be paid by the Company within 4 weeks from the  date of filing of such affidavit. If the affidavit accepting the above compensation is not filed as above, then it will  be taken  that the 19 individuals are not accepting the compensation  suggested, but  desire to agitate the same in accordance with law.      In the  circumstances, subject  to the  direction given above, the  appeals are allowed and the judgment of the High Court is  set aside.  However, there  will be no order as to costs.