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PETITIONER:

MESSRS NOORULLA GHAZANFARULLA

Vs.

RESPONDENT:

THE MUNICIPAL BOARD OF ALIGARH, ALIGARH

DATE OF JUDGMENT07/02/1995

BENCH:

VENKATACHALA N. (J)

BENCH:

VENKATACHALA N. (J)

SAWANT, P.B.

CITATION:

1995 AIR 1058 1995 SCC Supl. (2) 667

JT 1995 (2) 249 1995 SCALE (1)643

ACT:

HEADNOTE:

JUDGMENT:

1.This appeal by special leave is directed against the

judgment and order dated 26.4.1982 of the High Court of

Allahabad by which Civil Misc. Writ Petition No. 12220 of

1975 filed by the petitioner therein, the appellant here,

was dismissed.

2.The appellant was a registered partnership firm. On 10.

10. 193 5 the Municipal Board of Aligarh, respondent- 1

granted to the appellant, acting in accordance with the

provisions of Section 224 and Section 224-A of the U.P.

Municipalities Act, 1916 - "the Act", 'Aligarh Water Supply

Licence, 1935' -- "the Licence" for providing water supply

to certain areas of Aligarh by taking over the then existing

water works of respondents, subject to the condition of

paying to respondent-1 annual fee of Rs.10,000/- and of

fulfilling other conditions of the Licence. Condition 7 of

those conditions which related to the period of licence,

read thus

"7. This licence shall remain in force for a

period of 50 years from its commencement. On

the expiry of the saidperiod of 50 years the

board may at its option either renew this

licence for another period of 50 years and on

the same terms and conditions, or if the board

and the licensees agree, for a different term

and on different conditions, or may take over

the whole water works on payment of the fair

value of the properties belonging to the

Licensees to be determined in the manner laid

down in section 224-C of the United Provinces

Municipalities Act."

3. But, the appellant since found it difficult to provide

water supply for areas of Aligarh as was required of it

under the Licence even during the basic period of 50 years

of the Licence, it requested respondent-1 to revoke the

Licence by having recourse to Section 224-B(2)(a) of the

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Act, so as to enable the latter to purchase the water works

as provided for under the succeeding Section 224-C of the

Act.

4. The Administrator of respondent1, responding to the

said request of the appellant made an order on 1.4.1975,

which indicated that respondent-1 had taken a decision to

revoke the Licence of the appellant according to Section

224B(2)(a) of the Act after it had obtained the previous

sanction of the State Government (respondent-2), as per

wireless message dated 30.3.1975 received by it. The mate-

rial part of that order read thus:

"(1) The licence dated 10.10.1935 granted to

M/s. Noorullah

Allahabad to supply water within Aligarh

Municipal limits is revoked with effect from

1st April 1975 and the of the Aligarh Water

works will be taken over by Aligarh Municipal

Board with effect from the same date.

(2) All property Tubewells, pumping sets,

Machinery, storage tanks, pipe lines mains,

equipments stores and other articles,

accessories & fittings Hydrants & Standposts

and office and account belonging to Aligarh

Water Works shall vest in Aligarh Municipal

Board and an powers and liabilities of the

licencee under the license to supply water

shall

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absolutely cease and determine with effect

from 1st April, 1975.

(3) The valuation of the property belonging

to the licensee shall be determined by the

State Govt. in accordance with the provisions

of the Municipalities Act, 1916.

5. Appellant which was served with the said order on the

same date on which it was made, promptly gave its reply

therefor, again on the very same date. How, the appellant

had understood the said order and how it treated that order

was made known to the Administrator by stating in its reply

thus:

"Although, the order sent by you is not

actually a notice, but as the order also

states clearly that the revocation will take

effect from 1.4.75 presume the order is meant

by you to serve the purpose of the notice as

required under section 224C(a) of the U.P.

Municipalities Act and take it as such. We

further presum that this order is meant by you

also to serve the purpose of the notice

required to be served on the Licensees under

sub- section (b) of Section 224C requiring

Licensees to sell their assets

water supply as essential necessity, in the

city and in order to avoid any hardship to the

citizens, we have decided to hand over the

undertaking under protest and without

prejudice to our rights under section 224C of

U.P. Municipalities Act ............

With the take-over of the water works all our

responsibilities and liabilities under the

Licence shall cease except for our rights to

receive full compensation and our dues to be

realised by the Municipal Board .......

Please acknowledge and kg us have an early

reply and oblige."

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Early reply, as requested for as above by the appellant does

not appear to have been given by the Administrator of

respondent1, in that, no information in that regard was made

available even though the same was required to be furnished

by an order made by us on 14.1.1994.

6. However, before the sale of properties of the

appellant in the water works envisaged under Section 224-C

of the Act which was adverted to in the appellant's reply

given in response to the Administrator's order dated

1.4.1975, that on 13.6.1975 Ordinance No. 16 of 1975 came to

be issued by respondent-2 substituting new section 224-B and

new section 224-C for existed sections 224-B and 224C of the

Act. The said Ordinance declared that new section 224-C

shall be deemed to have come into force on 1. 1. 1975 while

the other new sections shall be deemed to have come into

force on the date of Ordinance (ibid section 2 of the

Ordinance).

7. Later, that on 8.9.1975 Act No. 45 of 1975, enacted by

the State Legislative of respondent-2, replaced the said

Ordinance, with exactly the same text.

8. In the said situation, that on 20.10.1975, the

appellant filed Writ Petition, C.M. Writ No. 12220/75 under

Article 226 of the Constitution before the High Court of

Judicature at Allahabad, seeking from the High Court

issuance of directions to respondents 1 to 3 to pay fair

market value of the properties of the appellant in the water

works the licence of which had been revoked by respondent-1

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on 1.4.1975, without invoking the provisions of the amended

new Section 224-C of the Act to pay the amount to be com-

puted thereunder, as the value of such properties. But,

that writ petition was dismissed by the High Court.

9. The said dismissal of the writ petition by the High

Court, made the appellant question the correctness of

the order of such dismissal in this Court by filing a

Special Leave to appeal against it. At the hearing of that

Special Leave Petition, since it was contended that the High

Court did not consider the challenge to the constitutional

validity of Act 45 of 1975 even though the same had been

raised before it, Court granted leave sought for therein,

accepted the contention and disposed of Civil Appeal

No.352/81 arising out of it by setting aside the order of

the High Court under appeal and sending the matter to the

High Court for its decision on all questions arising before

it including the constitutional validity of Act 45 of 1975,

by rehearing the writ petition.

10.The High Court which reheard the writ petition as had

been ordered by this Court again dismissed the writ petition

by its judgment dated 26.4.1982. That judgment shows that

the submissions made on behalf of the petitioner therein

(appellant here) were confined to constitutional validity of

new Section 224-C of the Act which was substituted by Act 45

of 1975 for old Section 224-C of the Act. However, the High

Court as is seen from the judgment, although examined the

challenge directed against the constitutional validity of

new Section 224-C as that which was violative of Articles

19(1)(f) and 31 of the Constitution of India, found no

substance in the challenge. Consequently, the said writ

petition was dismissed by the judgment of the High Court

dated 26.4.1982. The present appeal by special leave is

filed by the petitioner therein-the appellant, against that

judgment, as stated at the outset.

11.One important event, occurring between the date of filing

of the appeal and its final hearing, the notice of which is

required to be taken before adverting to the arguments in

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the appeal and dealing with them, is of the determination of

the amount payable by respondent- 1 to the appellant for its

properties of Aligarh Water Works according to new Section

224-C of the Act as Rs.5,39,755/- and the payment of that

amount by respondent-1 to the appellant on 1.2.1989.

12.Contentions raised in support of this appeal by Shri

Harish N. Salve, the learned counsel for the appellant, in

his oral arguments and reiterated in his written submissions

could, for purposes of easy understanding and proper

consideration, be formulated thus

1. When, by his Order dated 1.4.1975the Administrator of

respondent revoked the appellant's licence in respect of

Aligarh Water Works with effect from 1.4.1975 by stating in

that order, that all property belonging to Aligarh Water

Works shall vest in Aligarh Municipal Board (respondent-1)

and all powers and liabilities of the licensee (the

appellant) under the licence to supply water shall ab-

solutely cease and determine with effect from 1.4.1975 and

that the value of the property belonging to the licensee

shall be determined by the State Government in accordance

with the provisions of the Municipalities Act 1916, did such

property

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of the appellant in Aligarh Water Works vest in respondent-1

on 1.4.1975 making it liable to pay its value to the

appellant and what remained with the appellant from 1.4.1975

was not its property in water works but merely the money

value or compensation payable by respondent-1 to the

appellant for such property, i.e., a chosein-action.

2. When, by Act 45 of 1975 enacted by the State

Legislature of respondent-2, property of the appellant in

the Aligarh Water Works was acquired for respondent-1,

making it liable to pay there . for an amount computed under

its provisions, was the property so acquired, a mere chose-

in action so as to make Act 45 of 1975 constitutionally

invalid by it in that, acquisition of money or chose-in-

action offended Article 19(1)(f) and Article 31 of the

Constitution.

3. Even if, it is assumed that new section 224-C of the

Act, which is substituted for the old Section 224-C of the

Act by Act 45 of 1975 is constitutionally valid and that

Rs.5,39,755/- computed thereunder is the correct amount

payable by respondent-1 to the appellant for the value of

the property of the appellant in Aligarh Water Works vested

in it under the new Section, and the same is paid to the

appellant on 1.2.1989, is respondent-1 justified in denying

to the appellant the interest payable, on that amount from

1.4.1975 - the deemed date of vesting of properties in

respondent-1 till 1.2.1989 the date on which respondent-1

paid that amount to the appellant, particularly when the

proviso to sub-section (2) of new Section 224C of the Act

required payment of such interest?

4. When a sum of Rs.2,50,000/-, ordered by this Court on

3.12-1990 to be, paid by respondent-1 to the appellant out

of the total interest payable to it on the amount of

compensation, is that sum of interest deposited by

respondent-1 with the Registrar of the Allahabad High Court,

not liable to be paid to the appellant.

13. As the above contentions raised in support of the

appeal were refuted by learned Counsel appearing for

respondents, it would be convenient to consider the merit

-of each of the said contentions seriatim.

Contention-1

14. Since this contention is founded on a statement made by

the Administrator of respondent- 1, in his Order of

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revocation of the licence of Aligarh Water Works held by the

appellant which creates an impression that the property of

the appellant in Aligarh Water Works was ordered to vest in

respondent- 1 with effect from 1.4.1975, the question that

calls for our consideration, to begin with, is whether the

provision in Section 224-C of the Act, as it stood before it

was substituted by Act 45 of 1975, with a new Section 224-C,

empowered the Board (respondent-1) to order vesting of the

property of the licensee (the appellant) in the Water Works

from a date when such licensee's licence in respect of water

supply through such Water Works, could be revoked in

exercise of the power conferred under that provision and if

that provision did not empower the Board, respondent-1 to

order the vesting of the property of the appellant in the

Water Works in itself, from the time it revoked its licence

given in respect of such water works, whether a statement

made by the Administrator of respondent-1 in

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his order of revocation that from the date of purchase due

of revocation of licence of the water works,

the property of the licensee, the appellant vested in

respondent-1, could have had the legal effect of vesting of

such property in respondent- 1.

15. Section 224-C of the Act, as it stood before its

substitution by Act 45 of 1975 with a new Section, read

thus:

224-C. Where the licence of a licensee is

revoked under the preceding section, the

following provisions shall have effect, namely

(a) The board shall serve a notice of the

revocation upon the licensee and shall in the

notice fix a date on which the revocation

shall take effect; and on and with effect from

such date all the powers and liabilities of

the licensee under the licence shall

absolutely cease and determine;

(b) where a notice of the revocation of a

licence has been served on the licensee the

board may, within three months after the

service of such notice and with the written

consent of the Local Government, by notice in

writing require the licensee to sell, and

thereupon the licensee shall sell, to the

board the whole Of the water- works at such

value as shall be mutually agreed upon, or in

default of such agreement at such value as

shall be determined by a valuer appointed by

the' board and the licensee and in case of

their disagreement by the Local Governments

the licensee shall however be responsible for

the establishment employed by him for the

undertaking and for any compensation or other

payments it may be necessary to incur on their

behalf-

Provided that the value of such water-works

shall be deemed to be their fair market value

at the time of purchase due regard being had

to the nature and condition for the time being

of such waterworks and to the state of repairs

thereof, and to the circumstances that they

are in such a position as to be ready fo

r

immediate working, and to the stability of the

same for the purpose of the undertaking but

without any addition in respect of

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compulsory purchase or of goodwill or of any

profits which may or might have been made from

the undertaking, or of any similar

consideration;

(c) where any part of the water-works was

transferred by the board to the licensee under

section 224(d), the board may, by notice in

writing require the licensee to re-transfer

the same to the board on payment by the board

of any sum by which the market value of such

part of the water-works may have been enhanced

by reason of any arrangement made-by the

licensee, such sum to be determined in the

manner provided in clause (d) of this section.

(d).........................

16. As seen from the Preamble of the above Section 224-C,

where the licence is revoked under the preceding section by

the Board (Section 224-B), the provisions to follow, i.e.,

clauses (a) to (d), shall have effect. First part of the

provision in clause (a) requires service of notice of

revocation upon the licensee fixing a date thereunder as to

the date on which revocation shall take effect, while its

second part declares that on and with effect from such date

of revocation, the powers and liabilities of the licensee

under the licence shall absolutely cease and determine,

First part of clause (b) of the provision which empowers the

Board by notice of revocation served upon the licensee to

require -the

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licensee to sell the water-works to the Board, by its second

part requires the licence to sell such water works only for

such value as shall be mutually agreed upon between the

licensee and the Board and if not, for the value determined

by the valuer to be appointed by both of them. The proviso

to the said provision then creates a legal fiction, when it

declares that the value of the water works for which it

would be sold shall be deemed to be fair market value on the

date of its purchase by the Board.

17. Therefore, the provision in clause (a) above makes it

clear that revocation of licence relating to water works

takes effect from the date fixed for the purpose by the

Board in the notice or order putting an end to the

licensee's rights and duties under the licence from that

date. Further, the provision in clause (b) and its proviso,

makes it abundantly clear that water works becomes the water

works of the Board only when the value payable by the Board

to the licensee of such water works is determined as

provided in the provision and the water works is actually

sold by the licensee to the Board pursuant to its (Board's)

notice issued to licensee to sell and not before.

18. Thus, the said provisions in Section 224-C of the

Act as they stood before they were substituted by new

Section under Act 45 of 1975, if had only empowered the

Board (respondent-1) to revoke the licence of the licensee

(the appellant) of water works from a date to be specified

by it and direct the licensee (the appellant) to sell the

water works (Aligarh Water Works) after the value of such

water works was determined either by mutual agreement or by

the valuer to be appointed by both, there is no escape for

us except holding that the Board had no power to appropriate

such water works to itself before the taking of such sale by

unilaterally stating that the properties of water works had

vested in it on the date of revocation. Accordingly, we

hold that the Board, respondent-1 was not empowered under

section 224-C of the Act, as it stood before its amendment

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by Act 45 of 1975, to get the ownership of the Aligarh Water

Works or property therein transferred to itself from the

appellant from the date specified for revocation of licence

of the appellant in respect of Aligarh Water Works, nor the

statement made by the Administrator of respondent-1 in his

Order (Notice) of revocation to the effect that the

properties of the water works had been vested in respondent-

1 from the date of revocation of licence, i.e., 1.4.1975,

did bring about that result.

19.Besides, when the provisions in Section 224-C of the Act,

as they stood before they were amended by a new Section,

substituted by Act 45 of 1975 empowered the Board to obtain

sale of water works from the licensee only after the price

or value of such water works had been agreed upon or fixed,

transfer of ownership of water works, i.e., tangible immov-

able property in exchange for a price from the licensee to

the Board could not have occurred before the taking place of

such sale, inasmuch as transfer of ownership of tangible

immovable property of the value of one hundred rupees and

upwards could take place only by sale made under a reg-

istered instrument as required under Section 54 of the

Transfer of Property Act, 1882. Therefore, unless a statute

itself provides for vesting and transfer of immovable

property from one person to another

257

by acquisition or the like, the question of transfer of

ownership of property in the water works from the licensee

(the appellant) to the Board (respondent-1) could not have

taken place, even if such water works had been forcibly

taken over by respondent-1 or the possession of the same had

been given to the Board (respondent-1), voluntarily by the

licensee, the appellant.

20. Provisions of the Land Acquisition Act, 1894 -- "the LA

Act", in fact, illustrate the legal position for the

possession of the land sought to be acquired under the LA

Act whether its possession is voluntarily handed over to the

Government by its owner or its possession is taken over by

the Government as provided for under the said Act, vesting

of such land in the Government takes place because of the

provisions in Sections 16 and 17 of the Act, which declare

that the land shall vest absolutely in the Government free

from all encumbrances at a stated point of time. In other

words, but, for statutory vesting of land according to

Sections 16 and 17 of the LA Act, the vesting of such land

in the Government cannot take place, even if possession of

it is taken by the Government in one way or the other.

21. Thus, when neither the Aligarh Water Works nor its

property stood transferred to and vested in the Board

(respondent-1) so as to make it the owner thereof, the mere

fact that on 1.4.1975, the Administrator of respondent-1,

who made an order revoking the licence of the appellant in

respect of the water works, stated in his order that from

1.4.1975, the date of revocation of the licence, the

property therein vested in the Board (respondent-1), did not

make the appellant lose the ownership of it and make

respondent-1 get the ownership thereof.

22. Apart from what we have stated as to non-transfer and

non-vesting of the property of the water works in

respondent-1, the reply given on 1.4.1975 by the appellant

to the order of the Administrator of respondent-1 made on

the same date, revoking his licence from 1.4.1975, which is

excerpted by us already, would clearly show that the

appellant disputed the statement of transfer and vesting of

water works in respondent-1, made in the order and required

respondent -1 to purchase the property of the appellant as

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provided for in Section 224-C of the Act, as it stood then.

23. It is no doubt stated in the said reply that the

appellant had decided to handover the undertaking (water

works) under protest, but it was unambiguously stated

therein that even if the appellant is ready to handover the

water works, the order made by the Administrator of re-

spondent-1 will have only the effect of requiring the

appellant to sell its property in the water works, as

provided for under clause (b) of Section 224-C, as it stood

then, can mean only that the vesting of appellant's water

works or its property in respondent-1, could take place only

after the sale effected by them, as required by the

provision therein.

24. From what we have stated above, it becomes obvious that

the Aligarh Water Works or the property therein belonging to

the appellant did not vest in respondent-1 according to the

order of revocation made by the Administrator of respondent-

1, with effect from the date of revocation of appellant's

licence in waterworks from 1.4.1975, so as to make

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respondent-1 liable to pay to the appellant only money value

of the water-works, that is, a chose-in-action on and after

1.4.1975, as contended for by learned counsel for the

appellant.

Contention-2:

25.Among other provisions in the Act, Sections 224-B and

224-C were substituted by Ordinance 16 of 1975, which was

replaced by Act 45 of 1975. Section 224B of the Act as

substituted by Section 2 of Act 45 of 1975, reads thus:

"224B. Every licence granted under clause (c)

of section 224 shall, if not already revoked,

stand revoked with effect from June 13, 1975.

26.Section 224-C of the Act, as substituted by Section 3 of

Act 45 of 1975 in so far it becomes material for the pur-

poses of this case, reads thus:

"224-C.(1) Where the licence of a licensee is

revoked under section 224-B as it stood

immediately before the commencement of the U.

Municipalities (Amendment) Act, 1975, or where

such licence stands revoked by virtue of the

new section 224B as substituted by the said

Act, all the property pertaining to the water

works (namely, all existing water supply

services, including all plants, machinery,

water works, pumping sets, filter beds, water

mains and pipes laid down along, over or under

any public street, and all buildings and other

works, materials, stores and things

appurtenant thereto) belonging to or vested in

the licensee immediately before the date of

revocation of the licence (hereinafter in this

section referred to as 'the said date') shall

as from the said date vest in and stand

transferred tothe Board free from any

debt,mortgage or similar obligation of the

licensee attached to such property:

Provided that any such debt, mortgage or

similar obligation shall attach to the amount

referred to in sub- section (2) in

substitution for such property.

(2) Where any property belonging to the

licensee vests in the Board under subsection

(1), not being water works of which only the

management was transferred to him by the Board

under clause (d) of Section 224, the Board

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shall pay to such licensee an amount

determined as hereinafter provided in this

section;

Provided that the licensee shall, in addition

to the said amount, be paid interest thereon

at the Reserve Bank rate ruling on the said

date plus one percentum for the period from

the said date to the date of payment of the

said amount.

(3) The State Government shall appoint, by

order in writing, a person having adequate

knowledge and experience in matters relating

to accounts, to be special officer to assess

any amount payable under this section to the

licensee after making the deductions mentioned

in this section.

(4) (a) The Special Officer may call for the

assistance of such officers and of the State

Government in the Local SelfGovernment

Engineering Department or of the Licensee, as

he may deem fit for assessing the net amount

payable.

(b) The Special Officer shall have the same

powers as are vested in a Civil Court under

the Code of Civil Procedure, 1908, when trying

a suit in respect of the fol lowing matters

(i) enforcing the attendance of any person

and examining him on oath;

(ii) compelling the production of documents;

and

259

(iii) issuing commissions for the nation of

witnesses.

The Special Officer shall also have such

further powers as may be specified by the

State Government by notification in the

Gazette.

(5) The gross amount payable to such be the

aggregate value of the amounts specified below

-

27. Sub-section (2) of Section 1 of Act 45 of 1975, which

refers to commencement of that Act reads, thus:

"(2) Section 3 shall be deemed to have come

into force an January 1, 1975, and the

provisions of this Act shall be deemed to have

come into force on June 13, 1975."

28. Under the said new Section 224-C of the Act where the

licence of a licensee. is revoked under Section 224-B, as it

Stood immediately before the commencement of Act 45 of 1975,

all the property pertaining to water works vested in the

licensee immediately before die date of revocation of the

licence (to be referred to as the said date). vested in and

stood transferred to the Board free from any debt, mortgage

or similar obligations of the licensee attached to such

property.

29. While dealing with Contention-1 above. we have held

that the licence of the appellant in respect of Aligarh

Water Works was revoked by respondents with effect from

1.4.1975 under Section 224B(2Xa) of the Act, as it stood

before it was substituted by new Section 224-B by Act 45 of

1975, and that neither the water works nor the property of

the appellant in Aligarh Water Works, the licence of which

was revoked on 1.4.1975, vest in respondent-1 either on

1.4.1975 or subsequently, since the property in the Water

Works was not sold by the appellant to respondent-1, as

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required under that Section. We have also held therein that

the appellant itself did not agree for the sale of its

property to be completed as provided under the said

provision, so that the properties could vest in respondent-

1. It is beyond dispute that no sale of the property of the

appellant in Aligarh Water Works was made in favour of

respondent1 before Ordinance 16 of 1975 and Act 45 of 1975

came into force. If that be so, the property in Aligarh

Water Works of the appellant continued to belong to him even

when the said Ordinance and said Act came into force. It is

for that reason, it has to be held that the property of the

appellant in Aligarh Water Works vested in respondent-1 on

31.3.1975, immediately before the, date of revocation of the

licence i. e. 1.4.1975, as envisaged under new Section 224-

C(1) of the Act. If that be so, the value or the amount

payable to the appellant for its property in Aligarh Water

Works was the amount pay able under new Section 224-C of the

Act and not the. value, which had to be paid under the, old

Section 224-C as it stood before its amendment.

30. Thus, the question of the value of the property of the

appellant in Aligarh Water Works becoming a chose-in-action

on the date of revocation of the licence of the appellant of

the water works i.e., on 1.4.1975, under Section 224-C of

the Act, as it stood before its amendment, did not arise.

The present contention raised on behalf of the appellant

that Act 45 of 1975 was constitutionally invalid as being

violative of Articles 19(1)(f) and 31, as is

260

pointed out earlier, is founded on the premise that the

acquisition sought to be made thereunder of the property of

the appellant in Aligarh Water Works was money, i.e., a

chose-in-action. But, as we have held, that was transferred

from the appellant and vested in respondent- 1 under new

Section 224-C(1) of the Act which was substituted for old

Section 224-C of the Act by Act 45 of 1975 is Aligarh Water

Works, that is, tangible immovable property therein and its

value, i.e., chose-inaction, the present contention does not

survive for consideration.

Contention-3:

31.This contention relates to the liability of respondent- 1

to pay to the appellant interest on the amount of

Rs.5,39,755/- as required by the proviso to sub-section (2)

of Section 224-C, as it stands substituted for old Section

224-C by Act 45 of 1975. That proviso, which is reproduced

by us earlier, makes it clear that on the amount' payable

for the property in the water works of the licensee vested

in the Board, the Board shall pay to such licensee in addi-

tion to the amount determined under the Section, interest

thereon at the Reserve Bank rate ruling on the said date

plus one percentum for the period from the said date (the

date immediately before the date of vesting of water works)

to the date of payment of the said amount. Therefore, when

the proviso requires payment by respondent- 1 of the

interest on the amount of Rs.5,39,755/- from 31.3.1975 to

1.2.1989 to the appellant as above, respondent-1 is liable

to pay the appellant interest on Rs.5,39,755/- at the

Reserve Bank rate ruling on the said date, i.e., 9 percent

per annum plus one percentum for the period from the said

date, i.e., 31.3.1975 to the payment of the said amount,

i.e., 1.2.1989, which works out to Rs. 7,45,828/-.

32.We, therefore, hold that respondent1 is liable to pay to

the appellant towards interest on-the amount payable to it a

sum of Rs.7,45,828/- less the sum of Rs.2,50,000/- deposited

by it with the Registrar of Allahabad High Court pursuant to

this Court's Order dated 3.12.1990.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 11

Contention-4:

33.A sum of Rs.2,50,000/- is said to have been deposited

with the Registrar, Allahabad High Court, towards part pay-

ment of interest on the amount payable by respondent-1 to

the appellant towards water works, i.e., the property of the

appellant in Aligarh Water Works. 'Mr, amount so deposited,

could be got by the appellant from the Registrar of the High

Court, since we have given deduction of this amount out of

the interest payable to the appellant while dealing with

Contention3 .

34.Subject to what we have said of the amount of interest

liable to be paid by respondent-1 to the appellant, this ap-

peal is dismissed, but without costs.

35.However, we direct respondent-1 to pay to the appellant

within three months from today, the balance of interest of

Rs.4,95,828/- liable to be paid by respondent-1 to the

appellant, together with interest at the rate of IO per cent

per annum from 1.2.1989 till the date of its payment.

263