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PETITIONER: THE ADMINISTRATOR MUNICIPALCOMMITTEE CHARKHI DADRI ANDANOTHE

       Vs.

RESPONDENT: RAMJI LAL BAGLA AND OTHERS

DATE OF JUDGMENT26/07/1995

BENCH: JEEVAN REDDY, B.P. (J) BENCH: JEEVAN REDDY, B.P. (J) SEN, S.C. (J)

CITATION:  1995 AIR 2329            1995 SCC  (5) 272  JT 1995 (5)   486        1995 SCALE  (4)559

ACT:

HEADNOTE:

JUDGMENT:                     J U D G M E N T B.P.JEEVAN REDDY, J.      Leave granted.      This appeal  is preferred  against the  Judgment of the Punjab and  Haryana High  Court allowing  the writ  petition filed by the respondents on the ground that the point raised in the  writ petition  is clearly  covered in  favour of the writ petitioners-respondents  by the ratio of the Full Bench decision of  that Court in Nawal Singh v. The Administrator, Municipal Committee,  Charkhi Dadri  and others  [A.I.R.1984 (Vol.71) Punjab and Haryana 61].      A notification  under Section  42 of  the  Punjab  Town Improvement  Act,  1922  (as  applicable  to  the  State  of Haryana) was issued proposing to acquire approximately 46.51 acres  of  land  within  the  boundaries  of  Charkhi  Dadri Municipality for  implementing a scheme (No.1-B) prepared by Charkhi Dadri  Improvement Trust  under Section 24 read with Section 28(2)  of the  Act. It  was published in the Haryana Government Gazette  Part 1-A  dated February  6,  1976.  The scheme contained in the Notification is an elaborate one. It is in  several parts.  It sets out inter alia the boundaries of the  land proposed to be acquired. Part I defines several expressions occurring in the scheme. Part II states that the area (covered by the scheme) proposed to be acquired will be laid out  and developed  as indicated in the zoning plan and the lay out plan. It specifies the several areas of the land reserved for  several general and special purposes mentioned therein. Part  III contains  "building restrictions, type of buildings permitted". It sets out elaborately the conditions and requirements  to be  observed in the construction of the buildings. Part  IV, titled  "Miscellaneous" states that the requirements of  this schedule  shall be  in addition to the requirement of  any by  laws and Local Act. It also empowers the Trust  to relax  any provisions  of the  Scheme with the prior sanction of the Government.

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    Pursuant to  the above Notification/Scheme, proceedings were initiated  for acquiring  the requisite  extent of  the land  and   an  award   passed  on  November  3,  1976.  The compensation determined under the award was also paid to the persons interested  in the  land acquired. Possession of the land was  also taken by the Improvement Trust on January 19, 1977.      Section 44-A  (added by the Haryana Legislature) of the Act  provides  that  "any  scheme  in  respect  of  which  a notification has  been published  under Section  42 shall be executed by the Trust within a period of five years from the date of  such notification."  The  proviso  to  the  Section however empowers  the State  Government to  extend the  said period if  it is  satisfied  that  for  reasons  beyond  the control of  the Trust,  the scheme  could  not  be  executed within the  said period  of  five  years.  Inasmuch  as  the aforesaid scheme  1-B could  not be executed within the said period of  five years,  the Trust  (Administrator  Municipal Committee, Charkhi  Dadri)  applied  for  extension  of  the scheme upto  5th February,  1983. It  appears that no orders were passed thereon by the Government.      On March  14, 1983  the respondents filed Writ Petition No.1542 of  1983 (from  which the present appeal arises) for the issuance  of an  appropriate writ,  order  or  direction quashing the  scheme aforesaid on the ground that the scheme not having  been executed  within the  period of  five years specified in Section 44-A, the scheme fails and is liable to be quashed.  It was  further prayed  that the respondents to the writ  petition (appellants in this appeal) be restrained from dispossessing  the writ  petitioners from  the land and the houses  in their  possession in  pursuance of  the  said scheme. This  writ petition  was  allowed  under  the  order impugned herein  in terms  of the  Full  Bench  decision  as stated above.      Learned counsel  for the  appellants, Shri Dhruv Mehta, submitted that  once the  award is  passed and possession is taken of the land acquired pursuant to the scheme, the title to the  land vests  in the  Trust and that non-completion of the scheme within the period of 5 years specified in Section 44-A cannot  have the  effect  of  invalidating  the  scheme and/or nullifying  the acquisition  of the  land  which  has become final.  Learned called  upon to  refund the amount of compensation, if any, received by them.      The Punjab Improvement Act was enacted in the year 1922 to make provision for the improvement and extension of towns in the  State of  Punjab. It  was enacted  with the previous sanction of  the Governor  General under Section 80-A (3) of the Government of India Act, 1919. Section 2 defines certain expressions occurring  in  the  Act.  Chapter-II  comprising Sections 3  to 11-A  provides for constitution of Trusts and matters incidental  thereto  while  Chapter-III  (comprising Sections 12  to 21-A)  contains  provisions  regulating  the proceedings of  the Trusts  and the  Committees  constituted under the  Act.  Chapter-IV  provides  for  preparation  and publication of  and other particulars concerning the schemes to be  prepared under the Act. Sections 22 to 27 provide for the preparation of development schemes and rehousing schemes while  Section  28  prescribes  the  matters  which  may  be provided for  in such schemes. Sections 29 to 31 provide for matters incidental  to the  Improvement schemes.  Section 36 provides  inter  alia  for  publication  of  the  scheme  so prepared. Section  38 provides  that during  the thirty days next  following  the  first  day  on  which  any  notice  is published under  Section 36  in counsel submitted that there are no  words in Section 44-A which purport to do so nor are

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there any  words therein  which purport  have the  effect of nullifying the  acquisition or  to convey  the title back to the erstwhile  owners. If  that was  the  intention  of  the Legislature, counsel submitted, it would have used clear and specific language providing for the said consequences. As it now stands, Section 44-A is only directory in nature and not mandatory,  says   the  counsel.   He  also   disputed   the correctness of  the Full  Bench decision in Naval Singh. Mr. Prem Malhotra,  learned counsel  for the respondents, on the other hand,  supported the reasoning and conclusion of Naval Singh and  submitted that  having regard  to the purpose and object underlying  Section 44-A,  it must  be deemed to be a mandatory provision.  On the  expiry of the five-year period (or the  period of extension granted by the Government under the proviso  to the said Section, if any) the scheme becomes inoperative and  cannot be  enforced any  longer.  Once  the scheme fails,  the acquisition  of  land  acquired  for  the purpose of executing the said scheme cannot survive. It also falls to  ground, which  means that  the land  which has not been utilised  for the  purpose of  the scheme,  has  to  be returned to  the erstwhile  owners, who  can  of  course  be notification under  sub-section (1) of Section 42 in respect of any  scheme shall  be conclusive evidence that the scheme has been  duly framed  and sanctioned.  The  proviso,  added later, says  that "no  notice in  respect of  sanction of  a scheme shall  be issued after the expiry of three years from the date  of first  publication of  notice relating  to that scheme under Section 36". Section 43 provides for alteration of the  scheme by  the Government  at any  time  before  its execution. Section  43-A (Haryana  Amendment)  empowers  the Government to  change the  purpose for  which the scheme has been framed.  Section 44  is  clarificatory  in  nature.  It provides that  "(A)ny number  of localities  in  respect  of which the  trust has framed or has proposed to frame schemes under this Act may, at any time, be included in one combined scheme." Section  44-A, added  by Haryana  Legislature - and which is  of crucial  relevance herein  - says  that  "(A)ny scheme in respect of which a notification has been published under section  42, shall  be executed  by the trust within a period of  five years  from the  date of such notification." The proviso to the Section reads: "(P)rovided that the State Government may,  if it  is satisfied  that it  is beyond the control of  the trust  to execute the scheme within the said period, extend  the respect of any scheme under the Act, the trust shall  serve individual  notices on  every  owner  and occupier of  the immovable  property which is proposed to be acquired for  the purpose  of  executing  the  scheme.  Such notice must  state that  the trust  proposes to acquire such property for  the purpose  of carrying  out the scheme under the Act  and require  such person,  if he  objects  to  such acquisition, to state his reasons in writing within a period of thirty  days from  the date  of service  of such  notice. Section 40  provides that  after considering  the objections filed and  after hearing  the objectors who may desire to be heard, the  Trust may  either abandon  the scheme  with  the approval of  the State  Government or  apply  to  the  State Government  for   sanction   of   the   scheme   with   such modifications as  it may deem necessary. Section 41 provides that upon  receiving the  recommendation of  the Trust,  the State Government  may sanction  the scheme  with or  without modifications or  may refuse  to sanction  the scheme or may return it  for reconsideration  of the  Trust. If  the State Government  chooses  to  sanction  the  scheme,  Section  42 provides that  it shall  notify the  sanction of such scheme and that  thereupon the  Trust shall  proceed  forthwith  to

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execute the  scheme. Sub-section (2) declares that a same as it may deem fit."      Chapter-V sets  out the  powers and duties of the Trust where a scheme has been sanctioned. Section 45 provides that where any  building, street  or other  land  vested  in  the Municipal Committee is required for executing a scheme under the Act,  the Trust  shall give  notice of  the same  to the president  of   the  Municipal   Committee  whereupon   such building, street  or other  land shall  vest in  the  Trust. Section 46  prescribes the  procedure to be followed where a private street  not vested  in the  Municipality is required for executing the scheme and how it should be transferred to the Trust. The remaining provisions in Chapter-IV are in the nature of  machinery provisions  and need not be referred to for the  purpose of  this case. Chapter V-A added by Haryana Legislature also need not be referred to.      Chapter-VI provides  for acquisition  of land  required for  executing   the  scheme   and  for   matters  connected therewith. Section 56 provides the procedure following which any person,  whose land  is  proposed  to  be  acquired  for executing a scheme, can apply for deleting his land from the acquisition. This  can be  done "before  the  Collector  has taken possession  of the  land under  Section 16 of the Land Acquisition  Act,  1894"  but  not  thereafter.  Section  57 provides  that   such  deletion   shall  not   prevent   the acquisition of  that land  at a  subsequent point of time if required for any of the purposes of the Act. Section 58 says that "(A)  tribunal shall  be  constituted  as  provided  in Section 60,  for the  purpose of performing the functions of the Court  in reference  to the  acquisition of land for the trust, under  the Land Acquisition Act, 1894". Section 59(a) provides that  "for the  purpose of acquiring land under the Land Acquisition Act, 1894 for the trust, the Tribunal shall (except for  the purposes  of Section 54 of the said Act) be deemed to  be the  Court and  the President  of the Tribunal shall be  deemed to be the Judge under the said Act". Clause (b) of  Section 59  provides that  the Land  Acquisition Act shall apply  to the  acquisition of  land required  for  the Trust subject to the modification set out in the Schedule to the Act.  Clause (c)  sets out  the powers  of the  Tribunal while Clause  (d) declares  that "the  award of  a  Tribunal shall be  deemed to be the award of the Court under the Land Acquisition Act,  1894  and  shall  be  final".  Section  60 provides for  the constitution  of the  Tribunal. Section 65 prescribes the  procedure to  be followed by the Tribunal in case of  disagreement  between  members  in  the  matter  of measurement of  land and  the amount  of compensation, while clarifying the  scope  and  extent  of  the  powers  of  the President of the Tribunal.      The Schedule  to the  Act  provides  the  modifications subject to which the Land Acquisition Act is made applicable for the  purpose of  acquiring the  land for  executing  the schemes. While  it is  not necessary  to notice  the several provisions in the Schedule, reference is necessary to Clause 6 of the Schedule, which adds a new Section, Section 17-A in the Land Acquisition Act. The new section reads:      "17-A. In  every case  referred to  in  section  16  or      section 17,  the Collector  shall, upon  payment of the      cost of  acquisition, make  over charge  of the land to      the trust,  and the  land shall  thereupon vest  in the      trust subject  to the liability of the trust to pay any      further costs  which may  be incurred on account of its      acquisition."      Clause (14)  of the Schedule has introduced Section 48- A. It provides for payment of compensation where an award is

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not passed within one year of the declaration of Section 6.      A perusal  of the  above provisions makes it clear that the land  required for  executing a  scheme framed under the Act can  be acquired  by the  Trust in  accordance with  the provisions of  Land Acquisition Act, 1894 as modified by the Schedule to  the Act.  It is further clear that the Tribunal created under  Section 60  of the Act takes the place of the Court under  the Land  Acquisition Act.  It is equally clear that where the compensation is paid and land is made over to the Trust,  the land  vests in  the Trust - which means that the title  to the  land gets  transferred from the owners of the land  to the  Trust. The precise question that arises in this appeal  is where  a land  has been acquired pursuant to and for  implementation of a scheme framed under the Act and has vested  in  the  trust,  whether  the  said  acquisition becomes  invalid   and  void  in  case  the  scheme  is  not implemented within  the period  of five  years prescribed by Section 44-A  and whether  the land  remaining unutilised at the end  of the  period prescribed in Section 44-A is liable to be  restored to  the erstwhile  owners/persons interested and if  so what  are the  other consequences that follow. In this case,  it may  be noticed,  the respondents’  land  was acquired in  accordance with  the provisions of the said Act read with  the provisions  of the Land Acquisition Act, 1894 and an  award passed  on November  3, 1976. The compensation determined  thereunder   was  also   paid  to   the  persons interested in  the  land  and  possession  of  the  land  so acquired was  made over  to the  Trust on  January 19, 1977. Since possession was taken pursuant to the award and payment of compensation,  the title  to the land vested in the Trust and the title of the owners came to an end. It is equally an undisputed fact  that the scheme could not be implemented in full within  the period  of five  years specified in Section 44-A. It  does not  also appear  that the  said  period  was extended in  any manner  by the  Government. The  assumption underlying  the   Judgment  under   appeal  -   though   not articulated as  such -  is that  some portions  of the  land acquired remain(s) unutilised. We assume it to be so for the purposes of  this case,  though not  recording a  finding to that effect.  The question  is whether  in such  a case, the acquisition of  land remaining  unutilised at the end of the period specified  in Section  44-A becomes  void and whether such unutilised  portion or  portions of  the  land,  is/are liable to  be restored  to its/their erstwhile owners and/or persons  interested?  This  involves  the  question  whether Section 44-A  is mandatory or merely directory. For the sake of convenience, we may set out the Section 44-A in full:      "44-A. Time limit for execution of scheme. - Any scheme      in respect  of which  a notification has been published      under section 42, shall be executed by the trust within      a  period   of  five   years  from  the  date  of  such      notification.           Provided that  the State  Government may, if it is      satisfied that it is beyond the control of the trust to      execute the  scheme within  the said period, extend the      same as it may deem fit."      In our  considered opinion, Section 44-A cannot be held to be  mandatory in  the sense  that non-compliance  with it leads to  nullification of the acquisition which has already become final.  Such non-compliance  cannot  also  result  in divesting of  title of the Trust nor is there any obligation to  restore   the  unutilised  portion(s)  of  land  to  its erstwhile owners/persons  interested. The  reasons  are  the following : (a) The  Section while using the expression "shall" does not

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provide  the   consequence  of   non-compliance   with   its requirement. One  of the well-accepted tests for determining whether a  provision is  directory or  mandatory is  to  see whether the  enactment provides  for the consequence flowing from  non-compliance   with  the   requirement   prescribed. Manbodhan Lal  Srivastava v. State of U.P. (A.I.R. 1959 S.C. 912). The proviso to Section 44-A empowers the Government to extend the  said period.  The proviso does not prescribe the outer limit  beyond which  extension cannot  be granted. Nor does it  indicate in  any manner  that the said power can be exercised by the Government only once and no more.      A question  may then  arise, why was the proviso put in at all?  What purpose  it seeks to achieve, if not to give a mandatory character  to the  requirement in the main limb of Section 44-A? Having regard to the totality of circumstances (including those  mentioned  under  (b)  and  (c)  occurring hereinafter) we  are of  the opinion that it appears to be a form of governmental control over those statutory bodies. If the trust  does not  execute the scheme within the period of five years  - and  the Government  does not  see  sufficient reason to extend time therefor - the Government may take any of the  steps contemplated  by Chapter-VA, which chapter was introduced by  the Haryana  Legislature  by  the  very  same Amendment  Act  (17/1973)  which  introduced  Section  44-A. Chapter V-A  vests in  the Deputy  Commissioner the power of control over  the trusts.  Section 55-A  empowers the Deputy Commissioner to  call for  information, statements, accounts and reports  from the  trusts and  to enquire generally into their working  and affairs.  Section 55-B  confers upon  the Deputy Commissioner  the power  to suspend any resolution or order of  the trust.  More important,  Section 55-C empowers the Deputy Commissioner to provide for performance of duties in case  of default  of the  trust in performing its duties. Section 55-C reads as follows:      "55-C. Power  to provide  for performance  of duties in      case  of   default  of   trust.-(1)  When   the  Deputy      Commissioner after  due enquiry,  is satisfied  that  a      trust has  made default  in performing any duty imposed      on it  by this  Act, or by any order or rule made under      this Act, he may, by an order in writing duly supported      with reasons  fix a  period for  the performance of the      duty; and  should it not be performed within the period      so fixed, he may appoint some person to perform it, and      may direct  that the  expenses thereof  shall be  paid,      within such time as he may fix, by the trust.      (2) Should  the expense  be not  so  paid,  the  Deputy      Commissioner may  make an  order directing  the  person      having the  custody of the balance of the trust fund to      pay the  expense, or  so much thereof, as may from time      to time  be possible,  from that balance in priority to      all other charges against the same."      The  section   is   self-explanatory   and   needs   no elaboration at  our hands.  Section 44-A  has to be read and understood along  with this  section which  means  that  the Deputy Commissioner  will have  to take action under Section 55-C, in  case of  the failure  of the  trust to execute the scheme within  the period  of five  years. If  the  time  is extended under  the proviso  and  yet  the  trust  fails  to execute the  scheme within  the extended  time,  the  Deputy Commissioner can  - ought  to  -  resort  to  Section  55-C. Sections 55-D  and 55-E  make the  acts and  orders  of  the Deputy  Commissioner  subject  to  Government’s  order.  It, therefore, cannot  be said  that Section 44-A or its proviso (b) The more important and substantial reason, of course, is that Section 44-A does not provide expressly or by necessary

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implication  that   non-compliance  therewith   results   in nullification of  the acquisition  or in  the  divesting  of title of  the Trust or that on such non-compliance, the land acquired   has    to   be    restored   to   its   erstwhile owners/claimants. It  does not  also  provide,  what  should happen  to   the  compensation  already  received  by  them. Evidently all  these aspects  could not have been left to be inferred. These  are very  vital matters  and not matters of mere procedure.  The divesting  of  title  is  a  matter  of substance and  not a  formality. So  is the  restoration  of land, return  of compensation received, interest, if any, to be paid  on  such  returned  amount,  compensation  for  any development and  improvements, if  any, made  on the land by the Trust  within  the  period  aforesaid.  Absence  of  any provision for  the above  matters,  in  our  opinion,  shows conclusively that  the provision  in Section  44-A  is  only directory notwithstanding  the  use  of  expression  "shall" therein. The  said provision  is meant  to impress  upon the Trust and  its authorities,  the desirability  of the  time- frame  within  which    the  schemes  should  ordinarily  be executed. But  to construe the said admonition as leading to the consequences suggested by the respondents’ counsel would amount not  only to reading words into the Section which are not there  but to  reading a  whole lot  of substantive  and procedural provisions  into it which the legislature has not thought fit  to provide  for. Acceptance  of the  contention urged by  the learned  counsel  for  the  respondents  would entail several  complications and situations for which there is no provision in the Act. According to the learned counsel only the  land which has not been utilised for the scheme is liable to  be restored  to its erstwhile owners, but not the land which has already been utilised. A question arises what is  ’utilisation’?   Suppose,  a  road  is  laid  and  other amenities  provided   but  the   construction  of  buildings contemplated by the scheme has not taken place. Is it a case of utilisation  or not?  It may  also happen that the nature and  character   of  the   land  has   been  changed   after acquisition. If so, the question arises whether the land has to be  restored to  its original  owners in the condition in which it  was acquired or in the condition in which it is on the expiry  of the  prescribed period or in the condition in which it is at the time of restoration. What about refund of compensation  already  received  by  the  erstwhile  owners? Whether they  are liable  to pay  any  interest  thereon  or whether  they   are     entitled  to  any  damages  for  the deprivation for  the period  they  have  been  kept  out  of possession? These  are only  a few  problems which may arise and are  mentioned only  to emphasise that not providing for all these  matters is  a sure indication of the provision in Section 44-A  not being  mandatory in the sense it is sought to be understood by the respondents. (c) Yet  another feature  to be  noticed is the placement of the Section 44-A. It occurs in Chapter IV which provides for preparation and  publication of  the schemes  under the Act. Chapter-V speaks  of powers  and duties of the Trust where a scheme  has   been  sanctioned   and  Chapter   VI  contains provisions relating  to acquisition  of  land  required  for execution of the scheme and other incidental matters. If the legislature intended  to say  that failure  to  execute  the scheme within  the time  prescribed in Section 44-A leads to nullification  of   acquisition  with   all  the   attendent consequences, the  Section should  have found  its place  in Chapter VI - and with specific and clearer language.      Learned counsel  for the  respondents, however,  places strong reliance  upon the  Full Bench decision of the Punjab

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and Haryana  High Court  in Naval Singh. We have perused the said  decision   does  not   deal   with,   or   take   into consideration,  what   according  to  us  are,  the  several substantial and relevant factors. In our respectful opinion, the non-consideration of the said aspects, detracts from the authority of the said decision. It is true that Section 44-A is one  of the  provisions  which  seeks  to  safeguard  the interest of  the owners  of the  land required for executing the schemes  framed under  the Act,  but that  does not mean that it  must be  given a  meaning and  content which it was never intended  to comprehend  and the  language whereof  is totally inadequate  to mean  what is sought to be attributed to it.  A provision  has to  be read  and understood  in the context of  the entire  scheme  of  the  enactment.  We  are therefore  unable  to  agree  with  the  said  decision  and accordingly over-rule  it. Certain  other decisions  of  the Punjab and  Haryana High Court have also been brought to our notice but  we do not think it necessary to deal with all of them in  the light  of the conclusion arrived at hereinabove which, we may reiterate, is confined to situations where the land has  been acquired  and the  title has  vested  in  the Trust.      For the  above reasons,  the  appeal  is  allowed.  The Judgment and order under appeal is set aside. There shall be no order as to costs.