MODI KUBERDAS HARGOVINDDAS Vs. STATE OF BOMBAY NOW GUJARAT
LAWS(GJH)-1966-11-4
HIGH COURT OF GUJARAT
Decided on November 23,1966

MODI KUBERDAS HARGOVINDDAS Appellant
VERSUS
STATE OF BOMBAY Respondents

JUDGEMENT

A.R.BAKSHI, M.U.SHAH - (1.) The petitioner in Special Civil Application No. 958 of 1966 was the Inamdar and owner of the village called Saijpur Bogha and the petitioners in Special Civil Application No. 959 of 1966 were the tenants of the lands belonging to the Inamdar of the village. In 1942-43 certain lands out of this village were requisitioned for the purpose of construction of an aerodrome and notifications were issued for the purpose whereafter possession of the lands was taken. In 1949 it was decided to acquire these lands whereupon notifications dated 16th March 1949 were published in the Bombay Government Gazette dated 31st March 1949 whereby it was proposed to acquire the said lands for the purpose mentioned therein and it was declared that on the publication of the notifications the said lands vested in the Government as mentioned therein. It may be mentioned that the original order of requisition was passed under the Defence of India Act 1939 and as that Act had already expired an Ordinance was issued sometime in 1946 validating the requisitions that were made and before the expiry of that Ordinance an Act called the Requisitioned Land (Continuance of Powers) Act 1947 i. e. Act No. XVII of 1947 was passed whereby certain powers under the Defence of India Act were continued and power to acquire property subject to the conditions mentioned in the Act was also given. The order of acquisition passed in 1949 was passed under Act XVII of 1947 and pursuant to the provisions of that Act the lands of the Inamdar vested in the Government concerned as from the date of the notifications. Some time in 1950 the Government made an offer of a certain amount of compensation but as that offer was not acceptable to the owners of the property acquired a reference had to be made to an arbitrator according to the provisions of the Act referred to above and it was only in December 1958 that an arbitrator was appointed to assess and award compensation according to the provisions of the aforesaid Act and the Rules then in force. The arbitrator entered upon the reference on 12th January 1959 and ordered notices to be issued to some of the interested persons and made the notices returnable in March 1959 i. e. after more than 63 days after entering upon the reference. The petitioner in Special Civil Application No. 958 of 1966 came to know that arbitration proceedings had commenced and on the application of the petitioner to be made a party he was joined as a claimant. The arbitrator thereafter made an award on 31st August 1959 against which the petitioner in Special Civil Application No. 958 of 1966 and the petitioners is Special Civil Application No. 959 of 1966 filed several First Appeals. According to the petitioners these appeals came up for hearing before the High Court on 19th and 20th July 1966 when the vires of the Requisitioned Land (Continuance of Powers) Act 1947 was challenged. But under the impression that the vires of the Act could not be permitted to be canvassed in the appeals which related to proceedings under a special Act the petitioners preferred the present two Special Civil Applications. It was on these facts that the Special Civil Applications have come to be filed.
(2.) At the outset it may be mentioned that the admitted position according to all the parties to these petitions is that the original order of requisition was passed under the Defence of India Act 1939 and that the order of acquisition of the property was passed under Act XVII of 1947 It is also not in dispute that Act XVII of 1947 was followed by Act XXX of 1952 sec. 24 whereof while repealing Act XVII of 1947 provides that any action taken under the repealed Act should be deemed to have been done under the Act of 1952 as if that Act was in force on the day on which such action was taken. It is therefore that the Arbitrator seems to have referred to the Act of 1952 in the award proceedings. Mr. Chhatrapati has challenged the validity of the relevant provisions relating to payment of compensation in both the enactments in Act No. XVII of 1947 and Act of XXX of 1952. Sec. 6 of the Requisitioned Land (Continuance of Powers) Act 1947 (Act No. XVII of 1947) is as under:- (2) In respect of any acquisition of requisitioned land under this Act or the Ordinance the amount of compensation payable shall be such sum as would be sufficient to purchase at the market rate prevailing on the date of the notice under sec. 5 a piece of land equal in area to and situated within a distance of three miles from the acquired land and suitable for the same use as that to which the acquired land was being put immediately before the date of its requisition or a sum equivalent to twice the market value of the acquired land on the date of its requisition whichever is less; and such amount shall be determined and paid in accordance with the procedure set out in the aforesaid sec. 19 and the rules made thereunder. We are here concerned with the provisions of sub-sec. (2) of sec. 6 and both Mr. Chhatrapati as well as Mr. Shah appearing on behalf of the petitioners have made it clear that they do not challenge the validity of the whole of sub-sec. (2) of sec. 6 but they challenge the validity of the provision of sub-sec. (2) of sec. 6 to the extent of the words or a sum equivalent to twice the market value of the acquired land on the date of its requisition whichever is less contained in that sub-section The contention of the petitioners is that the properties in question were acquired by notifications dated 16th March 1949 and on the publication of the said notifications the properties vested in the State and that therefore the State became liable to pay compensation according to and in consonance with the principles laid down in sec. 299 of the Government of India Act 1935 The further contention on behalf of the petitioners is that the words or a sum equivalent to twice the market value of the acquired land on the date of its requisition whichever is less are contrary to and violate the principles laid down in sec. 299 of the Government of India Act 1935 as the market value calculated on the basis of the date of the requisition of the acquired lands could not be considered to be just compensation to which the petitioners would be entitled according to sec. 299 of the Government of India Act 1935 This according to Mr. Chhatrapati would be the position if it was considered that the property was acquired under the provisions of Act No. XVII of 1947 and Mr. Chhatrapati urged that the same would be the position even if it was considered that the property was acquired under the provisions of Act No. XXX of 1952 because the provisions of Act No. XVII of 1947 and Act No. XXX of 1952 in respect of payment of compensation as regards acquired properties were similar.
(3.) Before we discuss the question of the validity of the impugned provisions it would be necessary to refer to some of the provisions of the different legislative enactments which have preceded Act No. XVII of 1947 The first is the Defence of India Act 1939 sec. 19 whereof provides for compensation to be paid in cases where any action of the nature described in sub-sec. (2) of sec. 299 of the Government of India Act 1935 has been taken. The relevant portion of this section is as under:- Compensation to be paid in accordance with certain principles for compulsory acquisition of immovable property etc.- (1) Where by or under any rule made under this Act any action is taken of the nature described in sub-sec. (2) of sec. 299 of the Government of India Act 1935 there shall be paid compensation the amount of which shall be determined in the manner and in accordance with the principles hereinafter set out that is to say : (a) Where the amount of compensation can be fixed by agreement it shall be paid in accordance with such agreement. (b) Where no such agreement can be reached the Central Government shall appoint as arbitrator a person qualified under sub-sec. (3) of sec. 220 of the above-mentioned Act for appointment as a Judge of High Court. (c) The Central Government may in any particular case nominate a person having expert knowledge as to the nature of the property acquired to assist the arbitrator and where such nomination is made the person to be compensated may also nominate an assessor for the said purpose. (d) At the commencement of the proceedings before the arbitrator the Central Government and the person to be compensated shall state what in their respective opinions is a fair amount of compensation (e) The arbitrator in making his award shall have regard to : (i) the provisions of sub-sec. (1) of sec. 23 of the Land Acquisition Act 1894 so far as the same can be made applicable and (ii) whether the acquisition is of a permanent or temporary character. It is noticeable that sec. 19 of the Defence of India Act makes a reference to an action in the nature described in sub-sec. (2) of sec. 299 of the Government of India Act 1935 and makes a provision for payment of compensation which has to be determined by an arbitrator who while making the award shall have regard to sub-sec. (1) of sec. 23 of the Land Acquistion Act. Rule 75-A of the Defence of India Rules may also be referred to here. Sub-rule (1) of Rule 75-A refers to requisitioning of property and sub-rule (2) refers to the acquisition of requisitioned property. The relevant provisions of the rule are as under:- 75 Requisitioning of property.-(1) If in the opinion of the Central Government or the Provincial Government it is necessary or expedient so to do for securing the defence of British India public safety the maintenance of public order or the efficient prosecution of the war or for maintaining supplies and services essential to the life of the community that Government may by order in writing requisition any property movable or immovable and may make such further orders as appear to that Government to be necessary or expedient in connection with the requisitioning: Provided that no property used for the purpose of religious worship and no such property as is referred to in rule 66 or in rule 72 shall be requisitioned under this rule. (2) Where the Central Government or the Provincial Government has requisitioned any property under sub-rule (1) that Government may use or deal with the property in such manner as may appear to it to be expedient. and may acquire it by serving on the owner thereof or where the owner is not readily traceable or the ownership is in dispute by publishing in the official Gazette a notice stating that the Central or Provincial Government as the case may be has decided to acquire it in pursuance of this rule. (3) Where a notice of acquisition is served on the owner of the property or published in the Official Gazette under sub-rule (2) then at the beginning of the day on which the notice is so served or published the property shall vest in Government free from any mortgage pledge lien or other similar encumbrance and the period of the requisition thereof shall end (4) Whenever in pursuance of sub-rule (1) or sub-rule (2) the Central Government or the Provincial Government requisitions or acquires any movable property the owner thereof shall be paid such compensation as the Government may determine: Provided that where immediately before the requisition the property was by virtue of a hire-purchase agreement in the possession of a person other than the owner the amount determined by Government as the total compensation payable in respect of the requisition or acquisition shall be apportioned between that person and the owner in such manner as they may agree upon and in default of agreement in such manner as an arbitrator appointed by the Government in this behalf may decide to be just. Then there is the India (Central Government and Legislature) Act 1946 sec. 3 whereof empowers the Indian Legislature to make laws in respect of certain matters including compulsory acquisition. Sec. 3 of that Act reads as under:- 3 Nothwithstanding anything in the Government of India Act 1935 the powers of the Indian Legislature to make laws shall extend to the making of laws (a) providing in relation to land in a Province which when the Act of the Indian Legislature known as the Defence of India Act 1939 expires is a subject to any requisition effected under the rules made under that Act for the continuance until not later than the end of the period mentioned in section 4 of this Act of all or any of the powers theretofore exercisable under the said Act of the Indian Legislature or the said rules; and (b) providing in particular for the continuance as aforesaid of the power of the Governor-General in Council compulsorily to acquire any such land as aforesaid for any purposes directly and without the interposition of any Province and any laws made by virtue of this sub-section may contain provisions with respect to offences against the laws enquiries and statistics for the purposes of the laws jurisdiction and powers of all Courts except the Federal Court with respect to any of the matters dealt with by the laws and fees in respect of any of those matters but not including fees taken in any Court; and sub-sec. (2) to (4) of the last preceding section shall apply in relation to any such laws as they apply in relation to laws made under that section. (2) Nothing in this section shall- (a) prejudice any power of the Governor-General in Council to acquire land in accordance with section one hundred and twenty-seven of the Government of India Act 1935 (which enables land to be acquired by the Governor- General in Council through the intermediacy of a Province); or (b) affect the provisions of sub-section (2) of section two hundred and ninetynine of that Act (which requires any law authorising the compulsory acquisition of land to make provision for the payment of compensation). (3) In this section the expression land includes immovable property of every kind. It will be noticeable that sub-sec. (2) of sec. 3 quoted above provides that the conferment of powers under sec. 3 would not affect the provisions of sub-sec. (2) of sec. 299 of the Government of India Act. Then comes the Requisitioned Land (Continuance of Powers) Act 1947 (Act No. XVII of 1947 That Act was the result of the expiry of the Defence of India Act 1939 Sec. 3 of the Act provides for continuance of previous requisitions and is as under:- Continuance of requisitions.-Notwithstanding the expiration of the Defence of India Act 1939 and the Rules made thereunder and the repeal of the Ordinance all requisitioned lands shall continue to be subject to requisition until the expiry of this Act and the appropriate Government may use or deal with any requisitioned land in such manner as may appear to it to be expedient; Provided that the appropriate Government may at any time release from requisition any requisitioned land. Sec. 4 of the Act relates to the release of requisitioned land and sec. 5 gives power to the Government to acquire requisitioned land. Sec. 5 of the Act which runs as under may be quoted here:- Power to acquire requisitioned land-(1) Subject to the provisions of sub-sec. (3) the appropriate Government may at any time when any requisitioned land continued to be subject to requisition under sec. 3 acquire such land by publishing in the Official Gazette a notice to the effect that such Government has decided to acquire such land in pursuance of this section. (2) When a notice as aforesaid is published in the Official Gazette the requisitioned land shall on and from the beginning of the day on which the notice is so published vest absolutely in the appropriate Government free from all encumbrances and the period of requisition of such land shall end. (3) No requisitioned land shall be acquired under this section except in the following circumstances namely:- (a) where any works have during the period of requisition been constructed on in or over the land wholly or partly at the expense of Government and the appropriate Government decides that the value of or the right to use such works should be preserved or secured for the purposes of Government; or (b) where the cost of restoring the land to its condition at the time of its requisition would in the determination of the appropriate Government be excessive having regard to the value of the land at that time and the owner declines to accept the release from requisition of the land without payment of compensation from Government. (4) Any decision or determination of the appropriate Government under sub-sec. (3) shall be final and shall not be called in question in any Court. (5) For the purposes of clause (a) of sub-sec. (3) works includes buildings structures and improvements of every description. Sec. 6 of the Act provides for payment of compensation firstly in respect of continued subjection of requisitioned land to requisition and secondly in respect of acquisition of requisitioned land. It would be proper to quote the entire section as a portion of that sub-sec. (2) of sec. 6 has been challenged in these petitions:- Payment of compensation.-(1) In respect of the continued subjection of requisitioned land to requisition under this Act or the Ordinance compensation shall be determined and paid in accordance with the provisions of sec. 19 of the Defence of India Act 1939 and of the rules made thereunder. Provided that all agreements and awards under the said section in respect of the payment of compensation for the period of requisition before the expiry of the said Act shall continue to be in force and shall apply to the payment of compensation for the period of requisition after such expiry. (2) In respect or any acquisition of requisitioned land under this Act or the Ordinance the amount of compensation payable shall be such sum as would be sufficient to purchase at the market rate prevailing on the date of the notice under sec. 5 a piece of land equal in area to and situated within a distance of three miles from the acquired land and suitable for the same use as that to which the acquired land was being put immediately before the date of its requisition or a sum equivalent to twice the market value of the acquired land on the date of its requisition whichever is less; and such amount shall be determined and paid in accordance with the procedure set out in the aforesaid sec. 19 and the rules made thereunder. (3) For the purposes of sub-sec. (1) all the provisions of the aforesaid sec. 19 and of the rules made thereunder and for the purposes of sub-sec. (2) such of those provisions as relate to matters of procedure shall be deemed to be continuing in force. It may here be stated that Act No. XVII of 1947 the relevant provisions whereof have been quoted above is repealed by Act No. XXX of 1952. Sub-sec. (3) of sec. 8 of the Act of 1952 provides for compensation payable for the acquisition of requisitioned property. That sub-section provides that: (3) The compensation payable for the acquisition of any property under sec. 7 shall be- (a) the price which the requisitioned property would have fatched in the open market if it had remained in the same condition as it was at the time of requisitioning and been sold on the date of acquisition or (b) twice the price which the requisitioned property would have fetched in the open market if it had been sold on the date of requisition whichever is less. Sec. 23 of the Act of 1952 relates to validation of certain requisitions and acquisitions and by sec. 24 Act No. XVII of 1947 is repealed. Sub-clause (b) of the proviso to sec. 24 provides that anything done or any action taken in exercise of the powers conferred by the repealed Act shall in so far as it is not inconsistent with the provisions of the Act of 1952 be deemed to have been done or taken in the exercise of the powers conferred by or under the Act of 1952 as if that Act was in force on the day on which such thing was done or action was taken. Sec. 24 of the Act of 1952 is as under:- Repeals and savings-(1) The requisitioned land (Continuance of Powers) Act 1947 (XVII of 1947) the Delhi Premises (Requisition and Eviction) Act 1947 (XLIX of 1947 and the Requisitioning and Acquisitioning of Immovable Property Ordinance 1952 (III of 1952) are hereby repealed. (2) For the removal of doubts it is hereby declared that any property which immediately before such repeal was subject to requisition under the provisions of either of the said Acts or the said Ordinance shall on the commencement of this Act be deemed to be property requisitioned under sec 3 of this Act and all the provisions of this Act shall apply accordingly: Provided that- (a) all agreements and awards for the payment of compensation in respect of any such property for any period of requisition before the commencement of this Act and in force immediately before such commencement shall continue to be in force and shall apply to the payment of compensation in respect of that property for any period of requisition after such commencement; (b) anything done or any action taken (including any orders notifications or rules made or issued) in exercise of the powers conferred by or under either of the said Acts or the said Ordinance shall in so far as it is not inconsistent with the provisions of this Act be deemed to have been done or taken in the exercise of the powers conferred by or under this Act as if this Act was in force on the day on which such thing was done or action was taken. It would be observed that the relevant provision in Act No. XVII of 1947 relating to payment of compensation is sub-sec. (2) of sec. 6 which has already been quoted and which contains the impugned words or a sum equivalent to twice the market value of the acquired land on the date of its requisition whichever is less and the relevant provision on the same subject of compensation in the Act of 1952 is contained in sub-sec. (3) of sec. 8 which has also been quoted and which contains the words twice the price which the requisitioned property would have fetched in the open market if it had been sold on the date of requisition whichever is less. It would thus appear that the relevant words in sub-sec. (2) of sec. 6 of Act No. XVII of 1947 which have been quoted above and the provision occuring in sub-sec. (3) of sec. 8 of the Act of 1952 are similar and therefore even if by virtue of proviso (b) to sec. 24 if action in the present cases be deemed to have been taken in the exercise of the powers conferred by or under the Act of 1952 as if that Act was in force on the day on which such thing was done or action was taken the same considerations would govern the question as regards the validity of the two provisions relating to payment of compensation and both the provisions will be governed by the same principles as are contained in sec. 299 of the Government of India Act and there is no dispute as regards this position between the parties.;


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