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  • provisions of sub-section (2) of section 299 of the Government of India Act, 1935.16. The Land Acquisition Act
  • S. 41. Section 40 (corresponding to Sec. 48 of the earlier Act)
  • sub-secs. (1) and (3) of Sec. 6 of the Land Acquisition Act
  • Land Acquisition (Amendment) Act, 1923, a new section 5A
  • Sec. 4 of the Land Acquisition Act, 1894,
  • Bombay Land Acquisition Act
  • LAND ACQUISITION ACT 1870
  • section 9, sub-section (1),
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Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
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Acts
  • provisions of sub-section (2) of section 299 of the Government of India Act, 1935.16. The Land Acquisition Act
  • S. 41. Section 40 (corresponding to Sec. 48 of the earlier Act)
  • sub-secs. (1) and (3) of Sec. 6 of the Land Acquisition Act
  • Land Acquisition (Amendment) Act, 1923, a new section 5A
  • Sec. 4 of the Land Acquisition Act, 1894,
  • Bombay Land Acquisition Act
  • LAND ACQUISITION ACT 1870
  • section 9, sub-section (1),
Smart Summary

Structured Summary of the Opinion (Mootham, C.J.)

Factual and Procedural Background

The appellant purchased two adjoining plots of agricultural land near Nauraiya Khera, Kanpur district, on 31 May 1943: one of about 9 acres (for Rs. 7,000) and shortly thereafter a permanent lease of an adjacent plot of 15.5 acres. The appellant obtained possession of the smaller plot by paying Rs. 1,705 to surrender the tenant's rights. Military requisition intervened: on 26 July 1943 the second plot (15.5 acres) was requisitioned and on 6 May 1944 an area of 1.59 acres out of the first plot was requisitioned, each requisition for a period of ten years. The appellant retained approximately 7.41 acres and undertook substantial improvements to that area (tube-well, water courses, quarters, fencing) allegedly costing over Rs. 60,000. The military-requisitioned area of 1.59 acres was released on 1 October 1955, restoring possession of the whole smaller plot.

In 1956 the State published notifications under the Land Acquisition Act, 1894: a Sec. 4 notification dated 25 June 1956 (published 30 June 1956) proposing acquisition of, inter alia, 11.664 acres in the village for a factory to be operated by Lakshmiratan Engineering Works Ltd., and, on the State's opinion of urgency, directed that Sec. 5A would not apply (under Sec. 17(4)). A Sec. 6 declaration dated 5 July 1956 (published 7 July 1956) declared the land needed for a company and directed the Collector to take possession of waste/arable land on expiration of the Sec. 9 notice period.

The appellant filed Writ Petition No. 1561 of 1956 seeking quashing of the 25 June and 5 July 1956 notifications. While that petition was pending, an agreement under Sec. 41 was published (11 August 1956) and on 6 December 1956 a fresh agreement was entered into. A fresh Sec. 6 notification dated 7 December 1956 (published 8 December 1956) declared acquisition of 6.93 acres (said to be wholly within the first plot of the appellant). The appellant filed Petition No. 352 of 1957 (21 January 1957) seeking (a) a mandamus preventing acquisition of his land, and (b) certiorari quashing the three notifications (25 June, 5 July and 7 December 1956). Both petitions were dismissed by Mr. Justice Mehrotra on 30 August 1957. The appellant appealed from that order; this opinion dismisses the appeal.

Legal Issues Presented

  1. Whether sub-sections (1) and (3) of Section 6 of the Land Acquisition Act, 1894 contravene Articles 31(2) and 19(1)(f) of the Constitution by permitting acquisition for purposes that are not necessarily public.
  2. Whether sub-section (3) of Section 6 and sub-sections (1) and (4) of Section 17 of the Act are invalid as contravening Article 14 (i.e., whether those provisions confer arbitrary or unfettered powers on the State Government).
  3. Whether land may be acquired under the Act for the purpose of erecting a factory for a company (i.e., whether such an object can qualify as a "public purpose" or a "work likely to prove useful to the public" within Sections 4, 40 and 41).
  4. Whether the Section 4 notification is invalid because (i) it was issued prior to the execution of the agreement required by Section 41, and (ii) there was a failure to comply with a Government Order (referred to in the opinion as Government Order No. 939 / Provincial Government order dated 12 July 1948) concerning maps and cultivated land procedures.

Arguments of the Parties

Appellant's Arguments

  • That sub-sections (1) and (3) of Section 6 are unconstitutional as they permit acquisition for purposes other than a public purpose and therefore infringe Articles 31(2) and 19(1)(f).
  • That sub-section (3) of Section 6 and sub-sections (1) and (4) of Section 17 are contrary to Article 14 because they vest arbitrary powers in the State Government (including the power to exclude the Sec. 5A objection procedure).
  • That the Act does not permit acquisition of land for the erection of a factory for a company — a factory cannot be a "work likely to prove useful to the public" and the public cannot be entitled to use such a factory in the manner contemplated by Sections 41/42.
  • That the Sec. 4 notification is bad because (i) it was published before the required Sec. 41 agreement was executed, and (ii) the district authorities failed to comply with the relevant Government Order (referred to in the opinion), rendering the notification invalid.

The opinion does not contain a detailed, separate statement of the respondents' written arguments; the Court's record notes that it was not contended that the notifications were issued in bad faith or that the Sec. 4 notification did not conform to Sec. 4's provisions.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Kanpur Oil Mills v. Judge (Appeals) Sales Tax, Kanpur Range, A.I.R. 1955 All. 99 Explains the meaning of "existing law" and that an existing law enacted by a competent legislature before the Constitution cannot be invalidated simply because a legislature after the Constitution might not be competent to enact it; an existing law is saved by Article 31(5) unless it conflicts with other provisions of the Constitution. Used to reject the appellant's contention that the Land Acquisition Act (1894) ceased to be a valid law on the Constitution's commencement; Court held the Act is an "existing law" within Art. 31(5) and thus not open to the challenge urged.
Smt. Lila Vati Bai v. State of Bombay, A.I.R. 1957 S.C. 521 Confirms that Acts enacted before the Constitution which are not covered by Art. 31(6) are saved by Art. 31(5) even if their language does not explicitly use the phrase "for a public purpose". Relied upon to support the position that the Land Acquisition Act, as an existing law, is valid despite criticisms based on Art. 31(2).
The State of Bombay v. Bhanji Munji, A.I.R. 1955 S.C. 41 Holds that Art. 19(1)(f) presupposes the existence of property; where property is lawfully deprived under Art. 31, Art. 19 protections are not the appropriate basis for challenge. Applied to reject the appellant's Art. 19(1)(f) challenge: if property is lawfully acquired under the Land Acquisition Act, the protections of Art. 19(1)(f) are not available to defeat that acquisition.
A.K. Gopalan v. State of Madras, A.I.R. 1950 S.C. 27 Principle that the freedoms of Art. 19 presuppose certain pre-existing conditions (analogous reasoning about deprivation of liberty/property and the appropriate constitutional article to examine justification). Referred to as supporting authority for the proposition that total deprivation of property is to be judged under Art. 31 rather than Art. 19.
Pannalal Binraj v. Union of India, A.I.R. 1957 S.C. 397 Describes that the power vested in Government under acquisition statutes is "guided and controlled by the purpose which is to be achieved by the Act itself"—justifying a wide but purposive discretion. Cited to support the view that Sec. 6 confers a discretion that is not arbitrary but guided by the Act's public-purpose objective; thus Sec. 6 is not violative of Art. 14.
Ezra v. The Secretary of State, I.L.R. 30 Cal. 36 Holds that satisfaction of the Government under provisions like Sec. 41 is a matter of the Government's discretion and that courts have limited scope to examine the grounds of that satisfaction; agreements under Sec. 41 can become part of law when published. Relied upon to support the Court's conclusion that the State Government's satisfaction whether a work is "likely to prove useful to the public" is subjective and not open to judicial enquiry in detail; and to justify giving effect to the published agreement and its terms about public use.

Court's Reasoning and Analysis

The Court proceeded by examining the statutory scheme and constitutional arguments in sequence, grounding its analysis in the text of the Land Acquisition Act and relevant constitutional provisions and decisions:

  1. On the challenge to Sections 6(1) & (3) under Article 31(2): The Court read the Act as a whole and held that every acquisition begins with a Sec. 4 notification which can only be issued when the appropriate Government is satisfied the land is needed or likely to be needed for a public purpose. Thus, by implication and construction, acquisitions under the Act must be for a public purpose. The Court also invoked Art. 31(5) and the definition of "existing law" in Art. 366(10) to hold that the Land Acquisition Act (an 1894 enactment, later amended) is an existing law saved from challenge under Art. 31(2). The appellant's Art. 372 argument (that pre-Constitution laws survive only "subject to" the Constitution and thus must immediately conform to constitutional limitations) was rejected as misconceived in light of Art. 31(5) and authorities (Kanpur Oil Mills, Lila Vati Bai).
  2. On the Article 19(1)(f) contention: The Court relied on The State of Bombay v. Bhanji Munji and related reasoning to hold that Art. 19(1)(f) presupposes the existence of property to be enjoyed; if property has been lawfully deprived under the Land Acquisition Act, Art. 19 is not the proper vehicle to defeat the acquisition. Thus the appellant's reliance on Art. 19(1)(f) failed.
  3. On Article 14 challenges to Sec. 6, Sec. 17(1) and Sec. 17(4): The Court found these powers were not arbitrary when read in context. Although Sec. 6 refers to "for a public purpose or for a Company," the Court concluded that the Act's overall structure (beginning with Sec. 4 and, where companies are concerned, requiring state consent under Sec. 40 and an agreement under Sec. 41) demonstrates that acquisitions for companies must be tied to a public purpose. Similarly, the power under Sec. 17 to dispense with Sec. 5A (objections) in cases of urgency must be understood as referring to urgency in the public interest. The Court held that the statutory scheme provides adequate guiding principles and the State's discretion is not unfettered, so Art. 14 is not offended.
  4. On whether a factory can be a "work likely to prove useful to the public" (Secs. 40/41 and Sec. 4 public-purpose inquiry): The Court emphasized that Secs. 40 and 41 vest the State Government with the competence to be satisfied about usefulness to the public and to require an agreement setting out terms for public use. The Court examined the facts before it (licence granted by Central Government on 21 June 1950; State loan of Rs. 50 lakhs; the company to manufacture textile machine parts where none existed in Northern India) and held on the materials before the Court that the factory project was in the circumstances likely to be useful to the public. The Court also observed that the State's satisfaction is subjective and not ordinarily open to judicial re-examination (citing Ezra).
  5. On the validity of the Sec. 4 notification (timing of Sec. 41 agreement and compliance with a Government Order): The Court rejected the contention that the Sec. 41 agreement must precede the Sec. 4 notification, finding no statutory basis for such a requirement. As to the Government Order (dated 12 July 1948) requiring a map for acquisition of cultivated land, the Court accepted that the Order was a departmental instruction only and that failure to follow it did not affect the validity of the Sec. 4 notification.
  6. Having rejected the constitutional and procedural challenges, the Court upheld the notifications and dismissed the appeal. The Court also noted that it was not contended the notifications were issued in bad faith or that the Sec. 4 notification failed to conform to Sec. 4.

Holding and Implications

APPEAL DISMISSED.

Direct consequences and immediate effect:

  • The High Court's order dismissing the appellant's writ petitions (order of Mr. Justice Mehrotra dated 30 August 1957) is affirmed; the appeal is dismissed with costs assessed at Rs. 400.
  • The impugned notifications under Sections 4 and 6 (25 June 1956 and 5 July 1956) and the later Section 6 notification (7 December 1956) were held valid on the grounds set out above; the appellant's objections based on Articles 14, 19(1)(f) and 31(2) and the procedural objections to the Sec. 4 notification were rejected.

Broader implications:

The opinion applies established constitutional principles and precedents concerning (a) the saving of pre-Constitution "existing laws" under Art. 31(5), (b) the limited role of Art. 19 where property has been lawfully acquired under Art. 31, and (c) the deference to the State Government's satisfaction as to public purpose and urgency under the Land Acquisition Act (noting that such satisfactions are to be understood in the statutory context and are not readily justiciable). The Court did not purport to lay down any novel doctrine beyond its application of these principles to the facts; the decision sustains the statutory construction that acquisitions for companies can be validly tied to public purpose through the scheme of the Act.

This summary is strictly limited to information contained in the provided opinion and does not supplement or infer facts or reasoning beyond the text of that opinion.

    R.L Aurora v. The State Of Uttar Pradesh And Others

    Mootham, C.J:— This is an appeal from an order of Mr. Justice Mehrotra dated the 30th August, 1957, dismissing two petitions under Art. 226 of the Constitution. The relevant facts are these:

    On the 31st May, 1943, the appellant purchased a plot of agricultural land measuring approximately 9 acres in village Nauraiya Khera in Kanpur district for a sum of Rs. 7,000/-, and shortly thereafter he obtained the surrender of the tenancy rights of the tenant who was in occupation of the plot on payment of Rs. 1,705/-. He thus obtained actual physical possession over the entire plot. On the 31st May, 1943, the appellant also obtained a permanent lease of an adjacent plot of land measuring 15.5 acres. His purpose in acquiring the two plots had been, he says, for the erection of a factory. This object was however frustrated by the fact that on the 26th July, 1943, the military authorities requisitioned the second of the two plots measuring 15.5 acres and on the 6th May, 1944, an area of 1.59 acres out of the first of the two plots; the period of requisition in each case being for 10 years. The appellant was thus left with an area of about 7.41 acres which he says was utilised by him for the raising of food crops for which purpose he expended a sum of over Rs. 60,000/- in the construction of a tube-well, water courses, quarters and in enclosing the whole area with a barbed wire fence. On the 1st October, 1955, the military authorities released the area of 1.59 acres, thereby restoring the possession of the appellant over the whole of the first of the two plots.

    2. In 1956 the State Government proposed to acquire an area of land for the erection of a factory for the manufacture of textile machinery parts by the fourth respondent, the Lakshmiratan Engineering Works Ltd. On the 30th June, 1956, it published in the Gazette a notification dated the 25th June, 1956, under Sec. 4 of the Land Acquisition Act, 1894, which stated that it was proposed to acquire inter-alia, an area of 11.664 acres in village Nauraiya Khera for the construction of the proposed factory, and as it was of opinion that the case was one of urgency the State Government further directed, under Sec. 17(4) of the Act that the provisions of Sec. 5A would not apply to the acquisition. The area proposed to be acquired included the plot in the possession of the appellant and, it seems, a portion of the adjoining plot which had been requisitioned by the military authorities. On the 7th July, 1956, another notification dated the 5th July, 1956, was published in the Gazette whereunder the Governor declared, under Sec. 6 of the Act, that he was satisfied that, the land mentioned in the schedule thereto (which included the area of 11.664 acres in Nauraiya Khera) was needed for a Company. By this notification the Governor further directed the Collector of Kanpur to take possession of any waste or arable land forming part of the scheduled area on the expiration of the notice mentioned in sub-sec. (1) of sec. 9 of the Act. The appellant thereupon filed a petition in this Court (No. 1561 of 1956) wherein the principal relief sought was the quashing by a writ of certiorari of the notifications dated respectively the 25th June and the 5th July, 1956. Somewhat later, on the 11th August, 1956, a copy of the agreement between the State Government and the Lakshmiratan Engineering Works Ltd.; which had been entered into on the 5th August, 1956, pursuant to Sec. 41 of the Act, was published in the Gazette. On the 6th December, 1956, during the pendency of the writ petition No. 1561 of 1956, a fresh agreement under Sec. 41 of the Act was entered into between the Government and the Lakshmiratan Engineering Works Ltd., and thereafter a fresh notification, dated the 7th December, 1956, was published in the Gazette on the 8th December, 1956, under Sec. 6 of the Act. That notification was in exactly the same form as the earlier notification dated the preceding 7th July, save that the area of land sought to be acquired in Nauraiya Khera was stated to be 6.93 acres. It is common ground that this area is wholly within the first of the two plots acquired J by the appellant. The appellant then the filed in this Court, on the 21st January, 1957, petition No. 352 of 1957, in which he sought two reliefs: first, the issue of a writ in the nature of mandamus directing the respondents not to acquire the land and buildings belonging to the appellant in village Nauraiya Khera; and secondly, the I issue of a writ of certiorari quashing the notifications dated the 25th June, the 5th July and the 7th December, 1956. This petition in substance superseded the earlier petition No. 1561 of 1956. The two petitions were rejected by Mr. Justice Mehrotra by the order which is the subject of the present appeal.

    3. The validity of the three notifications has been attacked by Mr. Gopi Nath Kunzru on a number of grounds. In substance his submissions are four he argues firstly that sub-secs. (1) and (3) of Sec. 6 of the Land Acquisition Act are unconstitutional as they contravene Arts. 31(2) and 19(1)(f) of the Constitution; secondly, that sub-sec. (3) of Sec. 6 and sub-secs. (1) and (4) of Sec. 17 of the Act are invalid as they contravene Art. 14; thirdly, that in any case land cannot, under the Act, be acquired for the purpose of erecting a factory thereon; and fourthly, that the notification under Sec. 4 of the Act is bad in law because 3

    (i) it preceded the agreement for which provision is made in Sec. 41, and

    (ii) there was a failure on the part of the district authorities to comply with Government Order No. 939.

    4. It was not contended before us (as it had been before Mehrotra, J.) that the notifications under Secs. 4 and 6 were issued in bad faith or that the notification dated the 25th June, 1956, was not issued in conformity with the provisions of Sec. 4.

    5. Before proceeding to consider the several arguments addressed to us on behalf of the petitioner it is convenient to consider briefly the purpose and scope of the Land Acquisition Act. Prior to the year 1857 the compulsory acquisition of property was regulated by a number of regulations and acts of local application. In 1857 the Legislative Council passed Act VI of the year for the purpose, as stated in the preamble “to make better provision for the acquisition of land needed for public purposes within the territories in the possession and under the Government of the East India Company, and for the determination of the amount of compensation to be made for the same.” This Act was followed six years later by Act XXII of 1863 for the purpose of providing “for taking land for works of public utility to be constructed by private persons or Companies, and for regulation the construction and use of works on land so taken.” In this Act the phrase “work of public utility” was given a somewhat restricted meaning. In 1870 the earlier Acts of 1857 and 1863 were repealed and replaced by the Land Acquisition Act, 1870, the preamble to which stated that “it was expedient to consolidate and amend the law for the acquisition of land needed for public purposes and Companies….” This Act, like the present Act, was divided into Seven Parts of which Part VII dealt with the acquisition of land for Companies. Reference to “public utility” was omitted, but provision was made in Sec. 48 that the consent of the Local Government for the acquisition of land for a company should not be given unless that Government was satisfied that the acquisition was needed for the construction of some work which was likely to prove useful to the public.

    6. Then came the Act of 1894, passed, as the preamble states “to amend the law for the acquisition of land needed for public purposes and for Companies and for determining the amount of compensation to be made on account of such acquisition.” The Act was later itself amended but it is convenient to consider first the Act in its original form. The Act is divided into seven parts, of which Part I deals with preliminary matters. Part II deals with the acquisition of land, and Sec. 4 makes provision for the publication of preliminary notification which is the starting point of all acquisitions under the Act. Sub-Sec. (1) of this section reads thus:

    “(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, a notification to that effect shall be published in the Official Gazette, and the Collector shall cause public notice of the substance of such notification to be given at convenient places in the said locality.”

    7. It will be observed that this sub-section makes no specific reference to the acquisition of land for a company. Sub-s. (2) of s. 4 empowers an officer authorised by Government to enter upon any land in respect of which a notice under sub-s. (1) has been made in order to ascertain whether the land is suitable for the purpose for which it is required and generally to survey the land and mark boundaries. Sec. 5 makes provision for payment for such damage as may have been done in making such survey. Then comes sec. 6, which so far as is relevant provides that—

    “6.(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 Sec. 5A, sub-Sec. (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:

    (2) ....................

    (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.

    8. After this declaration has been made the State Government is required to direct the Collector “to take order for the acquisition of the land” (s. 8) and the Collector will then under S. 9 give public notice that the Government intends to take possession of the land and that claims to compensation may be made to him. Sec. 10 is supplemental to s. 9 and empowers the Collector to serve a notice on any person having an interest in the land requiring him to furnish the Collector with a Statement containing the names of all other persons having an interest in the land and the nature of that interest. Secs. 11 to 15 provide for an enquiry by him under S. 9 and into the claims which have been made for compensation and for making of an award with regard to the area of the land, the compensation which in his opinion should be allowed and the apportionment of that compensation among the persons having an interest in the land. After the award has been made the Collector is then empowered under S. 16 to take possession of the land which shall thereupon vest absolutely in the Government free from all encumbrances. Then comes s. 17, sub-s. (1) of which provides that

    “(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 public purposes or for a Company. Such land shall thereupon vest absolutely in the Government, free from all encumbrances.”

    9. Part II of the Act makes provision for a reference to the Court by any person who does not accept the Collector's award, and Parts IV, V and VI deal respectively with the apportionment of compensation, with payment of compensation and the temporary occupation of land, with none of which we are now concerned.

    10. Part VII (Ss. 38 to 44) makes provisions for the requisition of land for companies and is substantially in the same form as Part VII of the Act of 1870. Sec. 39 says that the provisions of Ss. 6 to 37 shall not be put in force to acquire land for a company unless (1) the previous consent of the state Government has been obtained and (ii) the company has executed the agreement for which provision is made in S. 41. Section 40 (corresponding to Sec. 48 of the earlier Act) was amended by Act 16 of 1933 which, in substance, enlarged the meaning of the word “work” to include the erection of dwelling houses for the company's employees and the provision of amenities. This section accordingly provides that such consent shall not be given unless the State Government is satisfied either—

    (a) that the purpose of the acquisition is to obtain land for the erection of dwelling houses for workmen employed by the Company or for the provision of amenities directly connected therewith, or

    (b) that such acquisition is needed for the construction of some work and that such work is likely to prove useful to the public.

    11. If the State Government is so satisfied then it must, under Sec. 41, require the company to enter into an agreement with it which must provide “to the satisfaction of the appropriate Government” for a number of matters including, in a case where the acquisition is for a work other than the erection of dwelling houses for workmen employed by the Company or the provision of amenities directed therewith, “the terms on which the public shall be entitled to use the work.”

    12. Part VIII deals with miscellaneous matters which are not material for our present purpose.

    13. It will be observed that the Act originally contained no provision empowering a person interested in land which had been notified under S. 4 to object to the acquisition, such person could object only, under S. 9, to the measurements made under S. 8, or under S. 18, to the award of the Collector. By the Land Acquisition (Amendment) Act, 1923, a new section 5A was inserted in Part II of the Act which made provision for the lodging of objections to the acquisition of land by any person interested therein and for the disposal of such objections. At the same time, and as a consequence of this amendment, a new sub-section (4) was added in s. 17. This sub-section provides that

    “17(4) In the case of any land to which, in the opinion of the appropriate Government, the provisions of sub-sec. (1) or sub-sec. (2) are applicable, the appropriate Government may direct that the provisions of Sec. 5A shall not apply, and, if it does so direct, a declaration may be made under Sec. 6 in respect of the land at any time after the publication of the notification under Sec. 4, Sub-Sec. (1).”

    14. By a later amending Act, No. XVI of 1933, another new Sec. 38A was inserted in Part VII of the Act enlarging the definition of the term “Company” for the purposes of that Part.

    15. The first argument advanced is that the acquisition of the appellant's land is bad in law because sub-Ss. (1) and (3) of S. 6 of the Act contravene the provisions of Art. 31(2) inasmuch as they confer upon the State Government the power to acquire property for a purpose which is not necessarily a public purpose. The answer to this argument is two fold. In the first place we are of opinion that the Act read as a whole makes it clear by implication that all acquisitions thereunder must be for a public purpose. Sec. 4, of the Act is, as we have pointed out, the starting point of every acquisition, and a notification thereunder can issue only when it appears to the appropriate Government that the land which, is the subject of the notification is needed or is likely to be needed for a public purpose. The second answer is to be found in Cls. (5) and (6) of Art. 31 of the Constitution which, so far as they are material, read thus:

    “(5) Nothing in clause (2) shall effect—

    (a) the provisions of any existing law other than a law to which the provisions of clause (6) apply, or………………

    (6) Any law of the State enacted not more than eighteen months before the commencement of this Constitution may within three months from such commencement be submitted to the President for his certification; and thereupon, if the President by public notification so certifies, it shall not be called in question in any Court on the ground that it contravenes the provisions of clause (2) of this Article or has contravened the provisions of sub-section (2) of section 299 of the Government of India Act, 1935.”

    16. The Land Acquisition Act was enacted many years before the constitution came into force and the provisions thereof would accordingly appear not to be subject to the constitutional limitations on the acquisition of property embodied in Art. 31(2). Learned counsel contends however that only a law which was a valid law after the Constitution came into force can be an “existing law,” and that the Land Acquisition Act ceased to be a valid law when the Constitution came into force. He has also argued that in any case Cl. 5(a) of Art. 31 applies only to those laws enacted less than eighteen months before the Constitution came into force which may or may not have been certified by the President under Cl. (6). This latter submission is we think wholly without force. Cl. 5(a) exempts from the operation of Cl. (2) of Art. 31 the provisions of any existing law except a law not made more than eighteen months before commencement of the Constitution. Clause (6) lays down a special procedure for such laws, and the acceptance of learned counsel's contention would appear ft) make Cl. 5(a) unnecessary.

    “Existing law” is defined in Art. 366(10) as including any law passed or made before the commencement of the Constitution by any legislature having power to make such a law. It is not suggested that the Indian Legislature had not the power in 1894 to pass the Land Acquisition Act, or in 1923 to amend it; and it appears manifest therefore that the Act is an existing law within the meaning of Art. 31(5). The argument however is that under Art. 372 a law in force immediately before the commencement of the Constitution continues in force “subject to the other provisions of the Constitution” and that, as under the Constitution no legislature can enact a law for the acquisition of property for a purpose other than a public purpose, the Land Acquisition Act, or at least those provisions therein which provide for the acquisition of land for a Company, became invalid immediately on the Constitution coming into force. This argument is not, in our opinion, well founded. In the first place it is clear that by virtue of Art. 31(5) no law which is an “existing law” as defined in Art. 366 can be questioned on the ground that it is in conflict with Art. 31(2). All that is necessary is that such a law has been enacted by a legislature which, at the time it passed the law, was competent to make it. Secondly, we think it to be clear that the phrase “subject to the provisions of this Constitution” applied to a law made before the Constitution came into force has, and fan have, no reference to the competence of Parliament or of a State Legislature to enact such a law after the Constitution came into force. The true position is we think well stated in Kanpur Oil Mills v. Judge (Appeals) Sales Tax, Kanpur Range A.I.R 1955 All. 99.. In that case V. Bhargava, J. said:—

    “What this really means is that, if any existing law contains any provision which is in conflict with any provision in the Constitution, that provision of the existing law would be void. Of course, it does not mean that a law, which was made by a competent legislature before the Constitution and which the legislature may not be competent to make after the Constitution, will also be void. All that is required is that the law should have been made by a competent legislature at the time when it made and, after the passing of the Constitution, it should not be contrary to any provision of the Constitution, and should not violate any fundamental right or other bad imposed by the Constitution against such a law.”

    17. Arguments somewhat similar to those addressed to us were considered by the Supreme Court in Smt Lila Vati Bai v. State Of Bombay A.I.R 1957 S.C 521.. Referring in that case to the Bombay Land Acquisition Act which had been passed in 1948—their Lordships said:—

    ‘It has not been contended that the law when passed on April 11, 1948 was not good law. It is also clear that the Act is not covered by the provisions of Cl. (6) of Art. 31. The Act is thus covered by the saving clause, Cl. 5(a), being an existing law other than a law to which the provisions of Cl. (6) apply. The Act, therefore, would be valid even if the provisions of Cl. (2) of Art. 31 are not in terms fully satisfied, in so far as the Act did not before its amendment by Act XXXIX of 1950 contain the expression “for a public purpose.”

    18. The argument based on Art. 19(1)(f) is, in our opinion, also without force. It is that sub-secs. (1) and (3) of S. 6 place a restriction on the appellant's right to hold property which cannot be justified under Art. 19(5). The matter is however concluded in our view by the decision of the Supreme Court in The State of Bombay v. Bhanji Munji A.I.R 1955 S.C 41.. In that case their Lordships said:

    “We need not examine those differences here because it is enough to say that Art. 19(1)(f) read with Cl. (5) postulates the existence of property which can be enjoyed and over which rights can be exercised because otherwise the reasonable restriction contemplated by Cl. (5) could not be brought into play. If there is no property which can be acquired, held or disposed of, no restriction can be placed on the exercise of the right to acquire, hold and dispose of it, and as Cl. (5) contemplates the placing of reasonable restrictions on the exercise of those rights it must follow that the Article postulates the existence of property over which those rights can be exercised.

    “In our opinion, this was decided in principle in A.K Gopalan v. State Of Madras. A.I.R 1950 S.C 27. where it was held that the freedoms relating to the person of a citizen guaranteed by Art. 19 assume the existence of a free citizen and can no longer be enjoyed if a citizen is deprived of his liberty by the law of preventive or punitive detention. In the same way, when there is a substantively total deprivation of property which is already held and enjoyed, one must turn to Art. 31 to see how far that is justified.”

    19. If, therefore, the appellant has been lawfully deprived of his land by virtue of proceedings under the Land Acquisition Act he can no longer in respect of that property exercise the right for which provision is made in Art. 19(1)(f).

    20. The second main submission is that Secs. 6, 17(1) and 17(4) are invalid as contravening Art. 14. Sec. 6, it is argued, confers upon the State Government a wholly unfettered power to acquire any person's land for a non-public purpose, while sub-secs. (1) and (4) of Sec. 17 invest the State Government with an unrestricted power to deprive a person of the right given to him by Sec. 5A of objecting to the acquisition of his property. We do not think that these contentions can be sustained.

    21. Sec. 6 empowers the State Government to make a declaration that any particular land is needed for a public purpose or for a Company. It is true that the phrase “for a public purpose or for a Company” used in this and other sections of the Act suggests that the acquisition of land for a Company need have no relation to any public purpose, but this impression is in our opinion dispelled on reading the Act as a whole. All proceedings under the Act for the acquisition of land for a public purpose or for a Company begin with the issue of a preliminary notification under Sec. 4. That section contains no reference to the acquisition of land for a Company, and accordingly it follows that no land can be acquired for a Company unless such acquisition is, in the opinion of the State Government, for a public purpose. Upon reading the statute as a whole there can we think be no doubt that the public interest or a public purpose is the object sought to be achieved by the Land Acquisition Act. It is to be observed that where (as in the present case) land is sought to be Required for the erection of a factory the State Government's consent has first to be obtained, and that under Sec. 40 such con.-sent cannot be given unless the State Government is satisfied not only that such acquisition is needed for the construction of some work but that such work is likely to prove useful to the public. Moreover, under Sec. 41 an agreement has to be entered into by the Company with the Government which must specify, inter alia, ‘the terms on which the public shall be entitled to use the work’ and that under Sec. 41 such terms shall, on publication, have the same effect as if they had formed part of the Act. If this be so, it follows that the power vested in the State Government under Sec. 6 to acquire land for a Company is not an uncontrolled power but is one which can be exercised only when the State Government is satisfied that the construction to be erected on the land is one which is likely to be useful to the public. The power vested in the Government is a power which, in the words used by the Supreme Court in Pannalal Binraj v. Union of India A.I.R 1957 S.C 397. “is guided and controlled by the purpose which is to be achieved by the Act itself”. A very wide discretion has necessarily to be given to the Government in deciding what land should be acquired having regard to the purpose of the Act, and that power being vested in the State Government an abuse of it is not readily to be assumed. We are of opinion that the power vested by Sec. 6 of the Act in the State Government is not an arbitrary or unfettered power and that section is not hit by Art. 14.

    22. With regard to sub-secs. (1) and (4) of Sec. 17, the argument is that these sub-sections confer an arbitrary power on the State Government to determine when a state of urgency exists and thus to deprive a person of his right under Sec. 5A to object to the acquisition of his property. No criteria, it is said, are laid down by which the State Government is to be guided in determining whether a state of urgency exists. Land can however be acquired even for a Company, only when such acquisition is for a public purpose, and in this background we think it to be sufficiently clear that the urgency which in the opinion of the State Government must exist before it can under sub-sec. (4)—the sub-section with which we are concerned in this appeal—declare that the provisions of Sec. 5A shall not apply, means an urgency in the public interest. We think that the Act contains a clear indication that the powers conferred on the State Government by the two sub-sections in question are to be exercised only when it is in the public interest that the acquisition of waste or arable land should not be delayed. The powers are not unfettered and the sub-sections do not in our judgment contravene the provisions of Art. 14. It is not seriously contended that in this case there has in fact been any discrimination against the appellant.

    23. Learned counsel then argues that in any case land cannot be acquired under the Land Acquisition Act for a Company for the erection of factory. The first branch of argument, as we understand it, is that a factory cannot be a “work likely to be useful to the public” within the meaning of Sec. 40, and it is not a work of which public can be entitled to any use in the manner contemplated by Secs. 41 and 42 of the Act. We are of opinion that the answer to this argument is to be found in Secs. 40 and 41 which make the decision of the State Government on both matters final and conclusive. Under the former section the State Government had to be satisfied that (in the present case) the acquisition was needed for a work likely to prove useful to the public; and under the latter section the fourth respondent is required to enter into an agreement with the State (Government providing to the satisfaction of the latter for certain matters including the terms on which the public shall be entitled to use the factory. Cl. 3(c) of the agreement dated the 6th December, 1956, entered into between the Governor of the Uttar Pradesh and the fourth respondent provided—

    “(c) that the public will have such right of access to and use of the land-works herein and before specified as may be necessary for the transaction of their business with the firm;”.

    24. The satisfaction of the State Government is a subjective satisfaction and it is not open to the Court to examine the grounds upon which it is founded. The question came before the Calcutta High Court in Ezra v. The Secretary of State I.L.R 30 Cal. 36. in which-that Court, having held that the question whether a particular work-in that case the erection of a bank—was likely to prove useful to the public was a matter left to the absolute discretion of the Local Government, said with reference to Sec. 41—

    “Under the provisions of S. 42 the agreement entered into between the Secretary of State and the Bank was published in the local Gazette and the Gazette of India, and by virtue of the enactment it has become a part and parcel of the law. Sec. 41 makes the Government the sole Judge of the manner in which the public are to have the use of the land taken up. The agreement provides that the public subject to the Act constituting and the bye laws regulating. The Bank, shall be entitled to the said building or buildings in relation to the said Government business so far as the same may be utilised by the Bank for the purposes of such business…. The acquisition was needed for the purpose of constructing new buildings to afford better accommodation for the transaction of the public business. The right of the public generally are dependent upon the Government business, and the Government has considered the conditions therein inserted as sufficiently safeguarding its interests. This Court, in our opinion, has no power to enter upon a consideration of the question how far that provision sufficiently safeguards the interest of the Government or of the public, of which it is the custodian.”

    25. The second branch of the argument is that the erection of a factory for a Company cannot be a public purpose within the meaning of S. 4 of the Act. We think this contention also to be unfounded. All that Sec. 4 requires as a condition precedent to the issue of a notification thereunder is the satisfaction of the State Government that certain land is needed or is likely to be needed for a public purpose. “Public purpose” is not defined in the Act, and whether at any particular time certain land is needed or is likely to be needed for such a purpose is a matter to be determined by the Government. The matter having been raised, we think it proper to state that on the facts disclosed in the affidavits filed in this case we are of opinion that the acquisition was for a public purpose in the sense in which we consider that those words are used in the Act, namely as “likely to prove useful to the public”. The appellant did not, in the affidavit which he filed in support of his petition, assert that the acquisition of his land was not for a public purpose; chat assertion appears only in his rejoinder affidavit. It is not however now in dispute that the purpose for which the respondent Company proposes to construct the factory is the manufacture of textile machinery parts, and that there is no other factory in Northern India in which such parts are made. Learned counsel has pointed out that the manufacture of textile machinery parts is not included in the Second Five Year Plan. It is however conceded that Plan includes the manufacture of machine made textiles. Textile machinery is therefore necessary, and we find no difficulty in holding that a factory which makes textile machine parts is, in the circumstances, likely to be useful to the public. It is to be noted that on the 21st June, 1950, the Central Government granted the respondent Company a licence for the manufacture of such machinery and that the State Government thereafter advanced to it a loan of Rs. 50 lacs to enable it to proceed with the construction of the work.

    26. Finally, it is argued that the notification under S. 4 is invalid on two grounds. In the first place it is contended that the agreement between the respondent Company and the State Government for which provision is made in S. 41 of the Act should have been executed before the notification was issued. We can see no reason why this should be so and none has been advanced. Secondly, it is said that the notification is bad as there has been a failure to comply with a Government Order issued by the Provincial Government on the 12th July, 1948, which said;

    “…..In all cases where it is proposed to acquire land under actual cultivation, the Collector should ask for a map showing areas of banjar or uncultivated land lying within a radius of half a mile of the site proposed to be acquired.”

    27. It is however conceded that this Order is no more than an instruction of a departmental nature and it cannot therefore affect the validity of the notification under S. 4. In the result therefore this appeal is dismissed with costs, which we assess at Rs. 400/-

    28. Appeal dismissed.

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    R.L Aurora v. The State Of Uttar Pradesh And Others
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