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PETITIONER: THE NAIHATI MUNICIPALITY AND ORS

       Vs.

RESPONDENT: CHINMOYEE MUKHERJEE AND ORS

DATE OF JUDGMENT:       06/08/1996

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. G.B. PATTANAIK (J)

CITATION:  JT 1996 (7)   359        1996 SCALE  (6)1

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R      This appeal  by special  leave arises from the judgment of the  Division Bench of the Calcutta High Court dated July 26, 1979  made in  C.R. No.2030  (W) of  1978. The  admitted facts are  that a  resolution was  passed by  the appellant- municipality for  rehabilitation of the hawkers by acquiring the land  in question. By that date the municipality did not have sufficient  funds to  meet the  acquisition costs. As a consequence, the  hawkers, union was requested to contribute the fund  to meet acquisition costs. In furtherance thereof, the hawkers  union deposited  with the municipality a sum of Rs.3,90,000/- for  the acquisition  of the  land.  The  said amount was  credited  to  the  funds  of  the  municipality. Thereafter a  reference made to the Government requesting to acquire the  land. In  furtherance thereof,  the  Government issued  notification   under  Section   4(1)  of   the  land Acquisition Act  1874 (1  of 1894)  (for short  the Act’) on August 1,  1974 and  acquired the plots of land bearing Nos. 412  to  426,497,  2400  to  2407  admeasuring  about  4.717 hectares of  the land in the village Kantalpara, P.S. Nahati Municipality.  Declaration   under  Section  6  came  to  be published on November 9, 1976. Both the notification and the declaration came to be challenged in the writ petition.      The High  Court concluded  in its  judgment that though there was  initial resolution  passed by the municipality to acquire the land there was no final resolution directing the Commissioner to  spend  the  money  from  the  fund  of  the municipality. The  hawkers themselves  deposited  the  money with the  municipal Corporation.  The Government  imposed  a condition that  the said  amount should be used only for the purpose of  acquisition of  land for  rehabilitation of  the hawkers.  The   appropriate  provisions   contained  in  the Municipality Act  have not  been complied  with. Under those circumstances,  there   is  no  public  purpose  indeed  for acquiring  the  land.  Accordingly,  the  declaration  under Section 6  came to  be quashed.  Thus this appeal by special

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leave.      We have been taken through the reasoning of the learned Judges and  have  also  heard  contentions  of  the  learned counsel for  the parties. We are of the view that High Court was not  right in  its  approach in dealing with the matter. The rehabilitation  of the  hawkers by acquiring the land is indisputably of  the public purpose; otherwise it would he a perpetual nuisance to the residents of the municipal area if hawkers were  permitted to hawk the goods on public pavement obstructing the  traffic flow in the city. Therefore it can, by no  stretch of  imagination, considered  that it is not a public purpose.  The question  then is:  whether the part or whole of  the compensation  would come from the funds of the local authority?  The second  proviso to  sub-section (1) of Section 6  deals that according to which 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 funds controlled or managed by a local  authority,   Indisputably  municipality  is  a  local authority and  to funds  are controlled  or managed  by  the municipality. In view of the fact that at the relevant point of time  the municipality  did not  have necessary  funds to meet the  cost of  acquisition, they  had requested hawkers’ union  to   contribute  the   money  for   the  acquisition. Consequentially, Rs.  3,90,000/- came  to be  handed over to the Municipal  Commissioner who  had deposited the same into the funds  of the  municipality.  Thereby,  the  amount  had formed and  fused into integral part of the municipal funds. It is  true that the Government had put restriction that the said money  would be  used only  for the  public purpose. It would be  obvious that  since municipality  did not have the required funds,  the Government had imposed a condition that the money contributed by the hawkers should be used only for the purpose of cost of the acquisition apprehending that the same may  be directed  to other  purpose. The  meat  of  the matter is  that after  the deposit by the hawkers, they have no right  to withdraw  the said  amount which formed part of the funds  of the  municipality. The  High Court, therefore, was not right in holding that the amount has not become part of the  funds managed  or controlled  by the local authority within the  meaning of  second proviso of sub-section (1) of Section 6.      The appeal  is accordingly  allowed. The  order of  the High Court is set aside. The Writ Petition stands dismissed. No costs.