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Luxmichand And Others v. State Of Uttar Pradesh And Others

Allahabad High Court
Oct 6, 1982
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Judgment Summary — A. N. Varma, J.

Factual and Procedural Background

The petitioners are tenure-holders of agricultural plots for which the State Government issued acquisition notifications under the Land Acquisition Act. The opinion records that a Notification under Section 4 was issued in October 1978 and a Notification under Section 6 was published in November 1978. The State Government stated that the acquisition purpose was the construction of a godown (storage depot) for the Central Warehousing Corporation at Pilkhani, Saharanpur, to address an alleged acute shortage of storage space for foodgrains.

The petitioners challenged the validity of the Notifications on two grounds: (1) that the matter was not one of urgency and therefore the State Government had no jurisdiction to dispense with the provisions of Section 5-A (which afford objectors an opportunity to be heard); and (2) that the acquisition was invalid for non-compliance with the second proviso to Section 6(1) of the Land Acquisition Act.

Key administrative facts presented in the opinion: recommendations by the District Magistrate were dated 9th February 1978 and 10th March 1978; the Central Warehousing Corporation sent letters dated 2nd March 1978 and 15th April 1978; the matter was considered by the Land Acquisition Committee of the Board of Revenue which approved urgent acquisition; survey and enquiry were conducted; an agreement between the Government and the Corporation was executed and published as required under Section 48; and notifications under Sections 4 and 6 were published in October/November 1978 as recorded in the opinion. The petition was heard by the Court and the writ petition was dismissed with costs.

Legal Issues Presented

  1. Whether the case was one of urgency entitling the State Government to exclude the provisions of Section 5-A of the Land Acquisition Act (i.e., whether the summary procedure dispensing with objections was justified).
  2. Whether the second proviso to Section 6(1) of the Land Acquisition Act required deposit of compensation before the making of the declaration under Section 6(1), and if non-deposit rendered the declaration invalid.

Arguments of the Parties

Petitioners' Arguments

  • The acquisition was not urgent because the District Magistrate's recommendation (dated about 9th February 1978) and the State's Notification (issued in October 1978) were separated by several months (close to eight months), and such delay negates the claim of urgency.
  • The State could not lawfully dispense with the protections of Section 5-A in the absence of genuine urgency.
  • The second proviso to Section 6(1) was not complied with because, according to the petitioners, compensation had not been deposited at the time the declaration under Section 6 was made (the S.6 Notification was published on 11th November 1978, while deposit of the requisite compensation occurred later on 20th June 1979, according to the record).
  • They relied on earlier decisions (Smt. Manohari Devi Balwal; Dr. Nanak Chand Chaturvedi; Ajadul Bux) which, on their reading, support the proposition that unexplained delay or failure to deposit compensation invalidates such notifications.

Respondents' (State / Central Warehousing Corporation) Arguments

  • The State explained the time taken: there was an acute shortage of storage for foodgrains and a national policy to construct large base depots; the Central Warehousing Corporation was to construct a 50,000 M.T. godown at Saharanpur with an estimated cost of Rs. 1.63 crores and partial World Bank financing.
  • The Collector recommended urgent acquisition (letters dated 9th February 1978 and 10th March 1978); the Corporation also pressed for urgent action (letters dated 2nd March 1978 and 15th April 1978).
  • The matter was referred to and approved by the Land Acquisition Committee; requisite survey and enquiry were carried out; the agreement (under Section 48) between Government and Corporation was executed and published; notifications under Sections 4 and 6 were published after completion of these formalities (the opinion records specific publication dates).
  • With regard to the second proviso to Section 6(1), the State's position (adopted by the Court) was that the proviso does not require actual deposit of compensation before the declaration; it requires only that the compensation be payable by a company or be out of public revenue or a fund controlled by a local authority — it does not mandate prior payment before making the declaration.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Smt. Manohari Devi Balwal v. State of U.P., 1979 All CJ 163 Delay (five months in that case) without explanatory facts may show absence of genuine urgency and therefore cannot justify dispensing with Section 5-A. The Court distinguished the case on the facts: unlike that case, relevant explanatory facts were placed on record here (shortage of storage, national policy, recommendations, committee approval and completion of pre-notification formalities), and therefore the present delay did not, on these facts, negate urgency.
AIR 1977 SC 183 (Supreme Court decision relied on in Manohari Devi) The question of urgency depends on the inherent nature of the acquisition and on the nature of the urgency; it may be necessary to dispense with Section 5-A in some cases but authorities must place relevant facts before the Court to justify such a step. The principle was acknowledged by the Court; it was applied to assess whether the State had placed adequate facts on record to justify dispensing with Section 5-A. The Court found that adequate facts had been placed on record in the present case.
Dr. Nanak Chand Chaturvedi v. State of U.P., 1979 All CJ 105 Where delay between decision to dispense with Section 5-A and publication of notifications is unexplained by the Government, urgency cannot be accepted. The Court distinguished this precedent on the basis that in the present case the Government had furnished a detailed explanation for the time-lag (described in the counter-affidavits and supplementary affidavits), so the present facts were materially different.
Ajadul Bux v. State of U.P., (1982) 8 All LR 352 : AIR 1982 All 435 Large unexplained delay (notifications years apart) and absence of material justifying urgency can render notifications under Sections 4 and 6 invalid. The Court held this case distinguishable: in Ajadul Bux there was no material to justify urgency and a long delay between Sections 4 and 6; in the present matter the Government produced material explaining urgency and the timing of formalities and publications.

Court's Reasoning and Analysis

The Court proceeded by focusing on the petitioners' two primary contentions and examined the facts placed on record by the Government.

First, on the urgency point and dispensing with Section 5-A:

  • The Court acknowledged prior authorities which hold that dispensing with Section 5-A must be justified by genuine urgency and that unexplained delay may indicate absence of such urgency.
  • However, the Court found the present facts distinguishable from those authorities because the Government placed detailed material on record: (a) an acute shortage of storage for foodgrains and a national policy to construct base depots; (b) the Central Warehousing Corporation's plan for a 50,000 M.T. godown at Saharanpur with substantial estimated cost and partial World Bank financing; (c) explicit recommendations by the Collector (dated 9th Feb. and 10th Mar. 1978) and pressing letters from the Corporation; (d) reference to and approval by the Land Acquisition Committee; (e) completion of survey, enquiry and execution/publication of the prescribed agreement under Section 48; and (f) publication of the Notifications after these formalities were concluded.
  • The Court accepted the Government's explanation for the time taken between the District Magistrate's recommendation and the publication of notifications, including administrative steps such as vetting and execution of the agreement and delays attributable to public holidays and publication processes at the Government Press (dates are recorded in the opinion).
  • On that basis the Court concluded the authorities did not act arbitrarily in excluding Section 5-A and that the purpose of acquisition (storage of foodgrains) was inherently urgent.

Second, on the second proviso to Section 6(1):

  • The Court set out the text of the second proviso, which states that "no such declaration shall be made unless the compensation to be awarded for property is to be paid by a company, or wholly, or partly out of public revenues or some fund controlled or managed by a local authority."
  • The petitioners argued this required deposit of compensation prior to the declaration under Section 6. The Court rejected that interpretation: it held that the proviso indicates the source from which compensation is to be paid (i.e., by a company or out of public revenues/fund) and does not require actual deposit of the awardable compensation before making the declaration.
  • The Court noted factual entries about token and later deposits (a token Rs.100 by Central Government on 13th July 1978; Treasury deposit on 28th June 1979; and a larger deposit on 20th June 1979 as recorded) but based its reasoning on the statutory construction that prior deposit is not mandated by the proviso.

Holding and Implications

DISMISSED

The Court dismissed the writ petition with costs.

Direct consequences for the parties:

  • The challenge to the Notifications (Sections 4 and 6) failed; the State's decisions to dispense with Section 5-A in the circumstances of this case were upheld by the Court.
  • The Court ruled that the second proviso to Section 6(1) does not require the actual deposit of compensation prior to the making of the declaration; therefore the petitioners' challenge on that ground failed.

No broader implications or pronouncements of new law are discussed in the opinion beyond the application of established principles to the facts of this case; the decision resolves the dispute between the parties on the facts and statutory interpretation presented.

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Judgement

A. N. VARMA, J.:- The petitioners are the tenure-holders of certain agricultural plots of land in respect of which the State Government on 11th of October, 1978 issued a Notification under Section 4 of the Land Acquisition Act. The Notification under S.6 of the Land Acquisition Act was published on 11th of November, 1978. The petitioners challenged the validity of these Notifications on two grounds. The first submission was that the case was not one of urgency and the State Government had no jurisdiction to exclude the provisions of S.5-A of the Land Acquisition Act so as to exclude objections by the tenure holders. The second ground is that the acquisition was bad for non-compliance of second proviso to S.6 (1) of the Land Acquisition Act. In the Notification issued under Section 4, it was stated that since the case was of urgency, the provisions of S.5-A are excluded. The purpose of acquisition was stated to be for construction of a godown for the Central Warehousing Corporation at Pilkhani, district Saharanpur. Learned counsel stresses that the recommendation by the District Magistrate for acquisition of land for the Corporation was made somewhere on 9th of Feb., 1978. The Notification in question was issued on 11th of October, 1978. This itself shows that there was no urgency in the matter because the authorities themselves took nearly eight months to issue the Notification under Section 4. Reliance in this connection has been placed upon Smt. Manohari Devi Balwal v. State of U.P. reported in 1979 All CJ 163. In that case also the District officer made his report in March, 1978 while the Notification was issued on 17th of Aug., 1978. It was held that the delay of five months itself shows that there was really no urgency in the matter. It was however, observed :

"It may be that if necessary facts are brought on record a delay of even five months may be held to be not undue but in the absence of relevant facts the circumstances that delay normally takes place in the Government Departments cannot by itself constitute sufficient ground to justify abrogation of the valuable right of the petitioner to file objection against the proposed acquisition of their land."

2. The factual situation in that case was that the relevant facts to explain the time consumed in issuing the notifications were not brought on the record of the case before the Court. In the next place, the purpose of acquisition was to establish an Industrial Estate, which normally takes a long time to accomplish. On these facts, the Bench relied upon a Supreme Court decision reported in AIR 1977 SC 183, in which it was emphasised that the question of urgency will partly depend upon the inherent nature of the acquisition and in the next place on the nature of urgency that is, whether the urgency is of such a nature that even the summary proceedings under Section 5-A should be dispensed with. It was incumbent upon the authorities to place the relevant facts before the Court to satisfy it, showing that it was such a case of such urgency.

3. In our opinion both these decisions are distinguishable on facts. In the present case it has been stated in the counter-affidavit that there was an acute shortage of storage space for foodgrains and as such the Government of India adopted a policy for construction of huge base depots and other godowns for scientific storage of foodgrains in the country. The Central Warehousing Corporation is a National Storage Agency established under Warehousing Corporation Act, 1962. The Government of India allotted two base depots for being constructed by this undertaking one at Muzaffarnagar and another at Saharanpur. At Saharanpur it was proposed to construct a godown of 50,000, M.T. The project was estimated to cost Rs. 1.63 crores and is being partly financed by the World Bank. The requirement of having a proper storage space at Saharanpur was urgent and the Collector, Saharanpur reported the matter to the State Government and recommended that the land in question be acquired after dispensing with the provisions of S.5-A of the Land Acquisition Act. This recommendation was made in the letters dated 9th of February, 1978 and 10th of March, 1978. The Warehousing Corporation also pleaded with the Government to the same effect by its letters dated 2nd of March 1978 and 15th of April, 1978.

The State Government on receipt of these reports and recommendations referred the matter to the Land Acquisition Committee constituted by the Board of Revenue, U.P. Government for its opinion. The said Committee went into the matter in detail and approved the recommendation to acquire the land in dispute urgently after dispensing with the provisions of section 5-a. The requisite survey and enquiry was conducted. The prescribed agreement was executed between the Government and the Warehousing Corporation and the same was published as required under S.48 of the Land Acquisition Act. As soon as the formalities and requisite conditions were fulfilled the Notifications under Ss.4 and 6 of the Act were published on 14th of October, 1978, namely the same day on which the agreement was published in the Gazette.

4. In our opinion, in the present case, the respondents have satisfactorily explained the time taken in concluding the formalities necessary before issuance of the Notifications under Sections 4 and 6 of the Land Acquisition Act. Further the purpose of acquisition namely the construction of godowns for scientific storage of foodgrains was in our opinion, inherently urgent. The State Government did not act arbitrarily in excluding the application of Section 5-A of the Land Acquisition Act.

5. For the petitioners reliance was also placed on another decision of this Court in the case of Dr. Nanak Chand Chaturvedi v. State of U. P. reported in 1979 All CJ 105, in which the same view as in the case of Smt. Manohari Devi Balwal (supra) was expressed and on the facts of that case it was held that as the delay between the decision to dispense with the requirements of S.5-A and the actual publication of Notifications under Sections 4 and 6 had not been explained by the Government, it cannot be said that there existed any real and genuine urgency entitling the Government to dispense with the requirement of S.5-A.

6. This decision again is clearly distinguishable. That was a case where the purpose of acquisition was stated to be construction of a market-yard for Krishi Utpadan Mandi Samiti, Muradnagar, which in our opinion, is a purpose which is inherently different from the purpose for which acquisition is being sought in the present case namely the construction of godowns for foodgrains. Secondly, in that case, it was observed by the Bench that the Government had failed to furnish to the Court any explanation for the delay between the decision to dispense with the requirements of Section 5-A and the actual publication of Notification under S.4 in the present case, we find that the Government has discharged that burden and fully explained the circumstances which had occasioned the delay. In the supplementary counter-affidavit of Sri M.C. Joshi the Joint Secretary, Cooperative Department, U. P. Shasam Lucknow, filed on behalf of the Government detailed facts have been stated explaining the time-lag between the receipt of the recommendation of the Districe Magistrate, Saharanpur to the effect that the land in question was urgently required for the construction of godowns by the Central Warehosing Corporation for storage of foodgrains and that the case was one of such urgency that the provisions of S.17 (iv) of the Land Acquisition Act dispensing with the requirements of S.5-A be also invoked and the publication of Notification (sic). On receipt of the recommendations, the Government asked for detailed information which was sent by the District Magistrate which was examined at the Government level, as a result of which it was found that the case seemed one of urgency warranting application of Section 17 (iv). Thereupon the matter was referred to the Land Acquisition Committee as per Acquisition Rules for the Companies. The Land Acquisition Committee sent its approval which was received by the Government on 26-8-1976. Thereupon, the Central Warehousing Corporation was asked to execute the deed of agreement as required under Section 41 of the Act. Upon the receipt of that agreement which was vetted by the Law Department of the Government the same was sent back for formal execution and signature of the Managing Director of the Corporation at Delhi. After the same was duly signed it was sent to the Government and thereupon, a Notification under S.4 of the Act was sent for publication to the Government Press, Allahabad. Some public holidays intervened between 1-10-78 and 14-10-1978 on account of which there was some delay in the publication of Notification. The Notification under Sec.4 was published on 14-10-1978 and immediately thereafter the Notification under Sec.6 of the Act was also sent for publication to the Government Press and the same was published on 11-11-1978. Before that a reminder had also been sent on 7-11-1978 to the Government Press for publication of the Notification.

7. These facts fully explain the period of the time between the recommendation to dispense with the requirements of S.5-A and the publication of the Notification under Section 4. In the facts and circumstances of the present case, therefore, we do not think that the decision to dispense with the requirements of S.5-A was taken arbitrarily or without any valid reasons. We are also satisfied that the purpose for which the acquisition of the disputed land was sought was inherently urgent warranting prompt action.

8. The third case relied on by the learned counsel in support of the petition is (1982) 8 All LR 352: (AIR 1982 All 435), (Ajadul Bux v. State of U.P.). This case is clearly distinguishable. There the Notification under Sec.4 was issued on 15th of December. 1969 by which the provisions of Section 5-A of the Act were also dispensed with. The Notification under Sec. 6 was, thereafter issued more than two years later on 18th of February, 1972. Further, in that case, unlike the present case, no material whatever was brought on the record of the case on behalf of the State Government in justification of the urgency and explaining the enormous delay between the publication of the Notifications under Sections 4 and 6. In these circumstances, both the notifications under Sections 4 and 6 were struck down by this court as being invalid.

9. We, therefore, find no merit in the first point.

10. The second submission is, in our opinion, equally without any merit. The second proviso to Section 6 (i) is that

"Provided further that no such declaration shall be made unless the compensation to be awarded for property is to be paid by a company, or wholly, or partly out of public revenues or some fund controlled or managed by a local authority."

11. Learned counsel submitted that this provision requires deposit of compensation before the issuance of the declaration under Section 6. In the present case, the Notification under S.6 of the Act was published on 11th of November, 1978, while the requisite compensation was deposited on 20th of June, 1979. In the counter-affidavit, it has been stated that the Central Government paid the token amount of Rs. 100/- to the State Government on 13th of July, 1978. In its turn the State Government sent the money to the Collector for depositing it in the treasury which deposit was effected on 28th of June, 1979. Be that as it may, the aforesaid second proviso does not require actual deposit of the compensation awardable for the acquired property before the making of the declaration under S.6 (i). It emphasises that the declaration shall not be made unless the compensation is to be paid by a company or out of public revenue etc. It does not require the actual deposit of the compensation in advance of the making of the declaration.

12. No other point was pressed.

13. The writ petition fails and is accordingly dismissed with costs.

Petition dismissed.