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CASE NO.: Appeal (civil)  1330 of 1997

PETITIONER: U.P. State Industrial Development Corporation   \005.Appellant

RESPONDENT: Rishabh Ispat Ltd. and others                           .\005Respondents

DATE OF JUDGMENT: 15/12/2006

BENCH: B.P. Singh & Altamas Kabir

JUDGMENT: J U D G M E N T

WITH CIVIL APPEAL NOS. 1332 - 1382 OF 1997 U.P. State Industrial Development Corporation   \005.Appellant Versus Pitalu and others                                       .\005Respondents         WITH CIVIL APPEAL NO. 1383 OF 1997 Rishabh Ispat Limited                                   \005.Appellant Versus State of Uttar Pradesh                          .\005Respondent  WITH CIVIL APPEAL NOS. 1384 - 1515 OF 1997 U.P. State Industrial Development Corporation   \005.Appellant Versus Tikkam Singh and others                                 .\005Respondents WITH CIVIL APPEAL NOS. 1516 - 1535 OF 1997 Bikhu Ram Jain and others                               \005.Appellants Versus State of Uttar Pradesh and others                       .\005Respondents WITH CIVIL APPEAL NO. 1331 OF 1997 Sharda Jain                                                     \005.Appellant Versus State of Uttar Pradesh and another                      .\005Respondents

B.P. SINGH, J.

       This batch of appeals has been preferred against the  common judgment and order of the High Court of Judicature at  Allahabad dated April 2, 1996 whereby a large number of appeals  preferred by the U.P. State Industrial Development Corporation  (UPSIDC) as well as the claimants have been decided.                   The lands acquired under the provisions of the Land  Acquisition Act measuring about 900 acres under three  Notifications are located in two adjacent villages, namely \026 Village  Habibpur and village Gulsitapur.  In respect of Habibpur a  Notification under Section 4(1) of the Land Acquisition Act  (hereinafter referred to as ’the Act’) was issued on 25th August,  1981 in respect of 225.75 acres of land.  Another Notification  under Section 4 was issued on 14th September, 1981 which related  to 173.5 acres of land in village Gulsitapur.  The third notification  was issued on May 30, 1985 which related to 501.48 acres of land  of village Gulsitapur.  

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       Civil Appeals Nos. 1330 of 1997, 1332 to 1382 of 1997  have been preferred by UPSIDC and relate to village Habibpur.    Similarly Civil Appeal Nos. 1384 to 1515 of 1997 have been  preferred by the UPSIDC.  The remaining appeals are by the land- owners/claimants.  

       Pursuant to the Notification issued under Section 4 of the  Land Acquisition Act on 25th August, 1981 the lands in village  Habibpur were sought to be acquired for a public purpose.  The  possession of the lands in question was taken on 25th September,  1981.  The Special Land Acquisition Officer offered compensation  to the land owners on the basis of circle rates of the lands in  question and accordingly for the lands of which the circle rate was  Rs.3.05 ps. the compensation was fixed @ Rs.6,486.49 ps. per  bigha.   Similarly the lands which had the circle rate of Rs.6.25 per  sq. yard, the compensation offered was Rs.11,583.02 ps.  The land-  owners were not satisfied with the offer of the Special Land  Acquisition Office, hence a reference was sought and made under  Section 18 of the Act.   The reference court enhanced the  compensation offered by the Special Land Acquisition Officer and  it allowed compensation @ Rs.11/- per sq. yard for the lands  abutting the road and a compensation of Rs.6/- per sq. yards for the  other lands.  The High Court on appeal by its impugned judgment  and order has maintained the compensation awarded in respect of  the lands abutting the road @ Rs.11/- per sq. yard and enhanced  the compensation in respect of other lands from Rs.6/- to Rs.9/- per  sq. yard.  It cannot be disputed that the lands in question are  valuable lands and have become even more valuable on account of  the development that has taken place in the area.  The lands are in  the vicinity of the city of Delhi and within 8-9 kilometers of Noida  on Dadri \026 Noida \026 Delhi main road.  It is not in dispute that  villages Habibpur and Gulsitapur are adjacent villages.  Having  regard to the location of these villages compensation for lands  acquired have been awarded on the same basis and at the same  rates by the High Court.

       The High Court has undertaken a very detailed and  meticulous examination of the evidence on record to determine the  compensation payable to the land-owners.  It is well settled that  having regard to the principles laid down in the Act the Court must  determine the compensation payable to the land-owners, but all  said and done as assessment of compensation to be awarded does  involve some rational guess work, having regard to all the facts  and circumstances of the case.   

       We have carefully perused the judgment of the High Court  and so far the quantum of compensation is concerned, we have not  found any illegality or irrationality in the reasoning of the High  Court.  On a very careful consideration of the evidence on record,  the High Court has recorded its finding and we, therefore, do not  find any reason to interfere with the order of the High Court.

       We may however notice that counsel appearing on behalf of  the appellant \026 UPSIDC submitted that in the instant case there  was a sale deed wherein land was purchased by Shri A.P. Sarin @  0.72 ps. per sq. yard.  He, therefore, submitted that there could be  no better evidence to prove that the value of the land was much  less, particularly when the aforesaid sale deed was executed only 4  days before the issuance of the Notification under Section 4 of the  Act.  The submission appears to be attractive, but having regard to  the fact that the Land Acquisition Collector himself offered  compensation @ Rs.3.92 ps. and Rs.2.14 per sq. yard, the  compensation could not have been reduced to 0.72 ps. per sq. yard  in view of the provision of Section 25 of the Act.  Moreover the

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sale deed does not appear to correctly represent the value of land in  that locality because the other exemplars gave a different picture.   On the other hand, the claimants had also produced a sale deed  dated 19th August, 1981 which related to the sale of 0.5 bigha of  land in village Habibpur @ Rs.43,801/- per bigha.  This exemplar  was rejected by the Reference Court observing that there was only  one such sale deed which disclosed such high value for the lands of  village Habibpur.  The Reference Court relied upon a sale deed  executed on 25th July, 1981 which related to the sale of 2 bighas of  land of village Habibpur @ Rs.21,600/- per bigha.  This sale deed  was executed on 25th July, 1981 whereas the Notification under  Section 4 was issued on 25th August, 1981.  The Reference Court  found this exemplar to be a reliable piece of evidence and  accordingly determined compensation @ Rs.11/- per sq. yard for  the lands abutting the road and Rs.6/- for the lands away from the  road.  The High Court has affirmed the finding of the Reference  Court.  We find no reason to interfere with the finding which is  based on proper appreciation of the evidence on record and the  proper application of the principles relating to determination of  compensation under the Act.

       Mr. Reddy then submitted that the claimants having  accepted the compensation offered to them without demur or  protest, they were not entitled to claim a reference under Section  18 of the Act.  On the other hand learned counsel for the claimants  contended that this submission was not founded on correct factual  basis since the claimants had filed their objections within time and,  therefore, there was no question of their accepting the  compensation without protest.  The question as to whether the  compensation offered was accepted without protest is essentially a  question of fact to be determined on the basis of the evidence on  record.  We have perused the material on record and the finding  recorded by the High Court in this regard.  The High Court found  that the Collector made his Award on 27th June, 1985 and an  application for making a reference was filed within time on 6th  August, 1985.  The claimants examined themselves on oath, and it  was not even suggested to them that they had accepted the  compensation without protest.  No evidence was brought on record  to establish that the compensation was accepted by the claimants  without protest.  On the other hand the fact that the claimants  promptly filed their objections and sought reference under Section  18 of the Act established that the claimants had not accepted the  compensation without protest, but their acceptance was subject to  the order that the Reference Court or any other superior court may  pass.   The High Court was, therefore, justified in holding that  there was no material to substantiate the contention that the  compensation had been accepted without protest by the claimants.  

       Shri Reddy also contended that the claimants were not  entitled to be paid any compensation for lands which they  possessed in violation of Section 154(1) read with Section 167(1)  and (2) of the U.P. Zamindari Abolition Act (U.P. Act No. 1 of  1951) since such lands vested in the State Government and  claimants had no right to claim compensation for such lands.

       It appears from the record that the plea urged on behalf of  the Land Acquisition Officer was initially upheld by the Reference  Court, but later that judgment was reviewed and it was held that  there was no evidence on record to prove that the claimants had  acquired any land in violation of the aforesaid provisions.  The  High Court considered the provisions on which reliance was  placed by the State particularly, Sections 154 and  167 of the U.P.  Zamindari Abolition Act.  Section 167 of the U.P. Zamindari  Abolition Act in terms provides that where any land has vested in  the State Government, it shall be lawful for the Collector to take

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possession of such land and to direct that any person occupying  such land be evicted from such land.  The Collector is also  authorized to use or cause to be used such force as may be  necessary for the purpose of taking over such possession or  evicting such unauthorized persons.  The High Court found that  there was no evidence whatsoever to substantiate the plea that the  claimants were in illegal and unauthorized possession of lands  which had vested in the State of Uttar Pradesh.  It was not shown  that at any stage any action was taken to evict and dispossess the  unauthorized occupants of such lands which had vested in the State  of Uttar Pradesh.  On the contrary it was not disputed that the  claimants were in possession till the date the possession of the land  was taken from them pursuant to the Notifications issued under  Section 4(1) and Section 6 of the Act.  Till that time they were in  possession and their possession was not disturbed by any action  taken by the Collector or the Gaon Sabha under any law.  Thus the  High Court held that there was no evidence to substantiate the  contention of the State that the claimants/land-owners were in  unauthorized possession of Government lands for which they could  not be compensated.  The High Court also noticed, and in our view  rightly, that such a plea could not be raised in a proceeding under  Section 18 of the Act.  It is also not in dispute that the Special  Land Acquisition Officer offered compensation to the claimants.   That obviously was on the basis that the State recognized the  claimants as the owners of the lands which were sought to be  acquired.  Having done so, and having made a reference to the  Court under Section 18 of the Act, it could not be contended by the  Special Land Acquisition Officer in the proceedings under Section  18 of the Act or in any proceedings arising therefrom that the  claimants, to whom he had himself offered compensation, were not  owners of the lands.  The State ought to have taken appropriate  proceedings, if any, permissible in law, to deny compensation to  such claimants, who according to the State were in occupation of  lands which had vested in the State of Uttar Pradesh.  Having  considered the material on record and the reasoning of the High  Court we are satisfied that the High Court was right in holding that  there was no material on record to prove that some of the claimants  were unauthorized occupants of Government lands and, therefore,  not entitled to compensation for such lands.  The High Court was  also right in holding that in a reference under Section 18 of the Act  such a contention could not be raised because matters that may be  considered by a court in a reference under Section 18 of the Act  are matters enumerated in Section 18 itself as also the following  sections.  This was not a case where two claimants had claimed  compensation in respect of the same land, or there was any dispute  as to the apportionment.  The State wanted the Court to hold that  the persons to whom the compensation had  been  offered, and   who the Collector had reasons to believe  were interested in the  land, should not be granted any compensation on the ground that  they had no interest in the lands and were in unauthorized  possession of Government lands.          We shall now consider the submissions urged by the  claimants in the appeals preferred by them relating to acquisition  of lands in village Habibpur.   According to the claimants a Notification under Section 4(1)  read with Section 17(4) of the Act was published on 25th August,  1981.  By the aforesaid Notification an inquiry under Section 5-A  of the Act was dispensed with.  Thereafter a declaration under  Section 6 was also issued.  The aforesaid Notification was  challenged by the claimants in Civil Misc. Writ Petition No.11872  of 1981 which was decided on May 23, 1983.   While deciding the  writ petition, the High Court held :-

"The result of the discussion is that the notification  issued under Section 6 of the Act without affording

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opportunity to the petitioners to file objections and  without an inquiry under Section 5A is invalid.  The  decision to obviate the inquiry under that provisions  was wholly without authority of law.  The recital to  that effect in the Notification under Section 4 is  invalid too.  The Notification dated August 25, 1981  is quashed.  The respondents are directed to permit the  petitioners to file objections and enquire into them  under Section 5A before making a fresh declaration, if  any, under Section 6 of the Act in regard to their  land."

       The State preferred a special leave petition before this Court  but during the pendency of the special leave petition issued a  Notification on July 11, 1983 inviting objections from the  claimants pursuant to the Notification earlier issued under Section  4 of the Act.  After considering the objections a Notification under  Section 6 of the Act was issued on October 7, 1983.  The  submission urged on behalf of the claimants  before the High Court  was that since the original Notifications under Sections 4 and 6 of  the Act were quashed and a fresh Notification was issued on July  11, 1983 inviting objections under Section 5-A of the Act,  the  compensation to be awarded must be determined by reckoning the  Notification issued on July 11, 1983 as the Notification under  Section 4 of the Act.

       The High Court negatived the contention and held that the  Notification under Section 4 of the Act issued on August 25, 1981  was in two parts.  While the first part declared the need for  acquisition of the lands in question for a public purpose, the second  part dispensed with the inquiry under Sections 5-A of the Act.  The  High Court had quashed only that part of the Notification which  dispensed with the inquiry under Section 5-A of the Act because  there was no material on record to establish any urgency which  could  justify dispensing with the inquiry under Section 5-A of the  Act.  On a reading of the judgment and order of the High Court it  was held that the first part of the Notification which was a  Notification under Section 4(1) of the Act was not quashed.   Adverting to the Notification issued on July 11, 1983 inviting  objections under Section 5-A of the Act the High Court observed  that the Notification did not even whisper that it was a Notification  under Section 4 of the Act.  It only recited the earlier history which  led to the issuance of the Notification inviting objections.   Thereafter on October 7, 1983, after considering the objections, a  Notification under Section 6 was issued.  No doubt this  Notification makes a reference to the Notification dated July 11,  1983 as Notification issued under sub-section (1) of Section 4 of  the Act.  The High Court, however, did not attach much  importance to this recital in the Notification issued under Section 6  of the Act because the Notification issued on July 11, 1983 did not  purport to be a Notification under Section 4(1) of the Act.  The  Notification clearly mentioned that it was a Notification inviting  objections under Section 5-A of the Act in continuation of the  Notification dated August 25, 1981 issued under Section 4(1) of  the Act.  It further held that the High Court in the earlier writ  petition did not quash the first part of the Notification dated  August 25, 1981 which remained intact.  Mere wrong mention of  the Section in the subsequent Notification did not make the  Notification inviting objections under Section 5-A of the Act a  Notification issued under Section 4(1) of the Act.

       Before us the same submission was urged by the counsel  appearing in the appeals preferred by the claimants.  Shri P.P. Rao,  learned senior counsel appearing on behalf of the claimants,

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submitted that the Notification issued on July 11, 1983 inviting  objections gave only 21 days time for filing of objections instead  of 30 days.  In any event he submitted that even if the aforesaid  Notification was not invalidated in toto, it must be treated as the  Notification under Section 4(1) of the Act.  The same submission  was reiterated by the other counsel appearing for the claimants in  the other appeals.  Mr. Tankha, learned senior counsel appearing  on behalf of some of the claimants, placed reliance on the  judgment of this Court reported in (1988) 3 SCC 294 : Raghunath  and others  vs.  State of Maharashtra and others and submitted  that once a Section 6 Notification is issued, the Notification under  Section 4 is exhausted.  Therefore, in the instant case the first  Notification issued under Section 6 of the Act having been  quashed, the Notification under Section 4 issued earlier got  exhausted and, therefore, it became necessary for the State to issue  another Notification under Section 4 of the Act. There was no  question of issuing a notification in continuation of the earlier  Section 4 notification.  According to him the second Notification  cannot be said to be in continuation of the first Notification.  He  also relied upon the judgment of this Court in (1990) 1 SCC 59 :  Hindustan Oil Mills Ltd. and another vs.  Special Deputy Collector  (Land Acquisition).

       In reply Shri Reddy, learned senior counsel, submitted that  the question of validity of a Notification could not be gone into in  a proceeding under Section 18 of the Act. He also relied on the  decision in Raghunath and distinguished the decision in Hindustan  Oil Mills.  We have carefully considered these two decisions cited at  the bar and on a careful consideration of the principles laid down  therein, it must be held that the claimants are not right in their  contention.   The submissions urged on their behalf proceed on the  assumption that the Notification issued under Section 4 of the Act  got exhausted after a Notification under Section  6 of the Act was  issued, which was later struck down by the High Court as invalid.   Reliance placed on the decision in Raghunath and others  vs.  State  of Maharashtra and others (supra) is misplaced.  In that case a  similar submission was advanced on the basis of the decision of  this Court in (1966) 3 SCR 437 : Girdharilal Amratlal  vs.  State of  Gujarat wherein the question for consideration of the Court was  whether there could be successive declarations in respect of  various parcels of land covered by a Notification under Section  4(1) of the Act and  whether once a declaration under Section 6  particularising the area in the locality specified in the Notification  under Section 4(1)  was issued, the remaining non-particularised  area stood automatically released.  It was in that context that it was  observed that once a valid declaration under Section 6 is made, the  scope of the Notification under Section 4 will get exhausted.  This  Court in Raghunath, therefore, held that the aforesaid principles  did not apply to a case where the declaration under Section 6 of the  Act was proved to be invalid, ineffective or infructuous for some  reason.  This Court referred to three earlier decisions of this Court  reported in (1966) 3 SCR 437 = AIR 1966 SC 1408 : Girdhari Lal  Amratlal  vs.  State of Gujarat ; (1976) 3 SCC 536 :  State of  Gujarat  vs.  Haider Bux Razvi and (1980) 1 SCC 308 : State vs   Bhogilal Keshavlal and held that where a Notification under  Section 6 is invalid, the government may treat it as ineffective and  issue in its place a fresh Notification under Section 6 and that there  is nothing in Section 48 of the Act to preclude the government  from doing so.  The decisions referred to by this Court clearly  point out the distinction between a case where there is an effective  declaration under Section 6 and a case where, for some reason the  declaration under Section 6 is invalid.  It further observed that in  principle there was no distinction between a case where a  declaration under Section 6 is declared invalid by the Court and a

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case in which the government itself withdraws the declaration  under Section 6 when some obvious illegality is pointed out.   The  Court, therefore, upheld the order of the High Court and held that  the issuance of a fresh declaration under Section 6 of the Act after  withdrawing the earlier one issued under Section 6 of the Act did  not have the effect of rendering the Notification under Section 4  ineffective and infructuous.  In the case of Raghunath a  Notification had been issued under Section 4 of the Act followed  by a declaration under Section 6 of the Act, but realizing that the  declaration was not valid since the objections filed by the  petitioners had not been heard before making the declaration, the  Government itself withdrew the Notification under Section 6 of the  Act and made another declaration after hearing objections under  Section 5-A of the Act.  We have no doubt that the same principle  applies to the facts of this case.    Reliance placed on Hindustan  Oil Mills Ltd. and another vs.  Special Deputy Collector (Land  Acquisition) (supra) is also of no avail to the claimants because  that case was decided on its own facts.  The first two Notifications  under Section 4 of the Act did not clearly indicate the land that was  proposed to be acquired.  That became clear only when the third  Notification was issued.  This Court found that there were vital  defects in the first two Notifications and it was really the third  Notification which was effective under Section 4 of the Act.  This  Court observed that when there is a Notification which purports to  be by way of an amendment, the question whether it is really one  rectifying certain errors in the earlier one or whether its nature is  such as to totally change the entire complexion of the matter would  have to be considered on the terms of the relevant notifications.   This Court, therefore, based its conclusion entirely on the language  of the Notification.  It was also observed that this did not mean that  wherever there are notifications by way of amendments, it is only  the last of them that can be taken as the effective notification under  Section 4 of the Act.  The authority, therefore, is of no assistance  to the claimants.  The principles laid down in Raghunath clearly  apply to the facts of the instant case and, therefore, the submission  urged on behalf of the claimants must be rejected.   

We, therefore, find no merit in any of these appeals and all  the appeals are, therefore, dismissed but without any order as to  costs.