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CASE NO.:

Appeal (crl.) 1164-1200 of 1993

PETITIONER:

Nagpur Improvement Trust

RESPONDENT:

Vasantrao and others

DATE OF JUDGMENT: 26/09/2002

BENCH:

CJI, SHIVARAJ V. PATIL & B.P. SINGH.

JUDGMENT:

WITH

CIVIL APPEAL NO.9209 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

Amrik Singh and others . Respondents

WITH

CIVIL APPEAL NO.9210 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

President, Improvement Trust Tribunal

Jalandhar and others . Respondents

WITH

CIVIL APPEAL NO.9213 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

Aminder Singh and others . Respondents

WITH

CIVIL APPEAL NO.9214 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

Gurdip Singh and others . Respondents

WITH

CIVIL APPEAL NOS.9260-9261 OF 1995

Amarjit Singh Nalwa . Appellant

Versus

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Jalandhar Improvement Trust and others . Respondents

WITH

SPECIAL LEAVE PETITION (CIVIL) NOS.8256-8259 OF 1993

Nagpur Improvement Trust . Appellant

Versus

Jaswantibai and others . Respondents

WITH

CIVIL APPEAL NO.839 OF 1995

Dr. Sudha Rani Gupta and others . Appellants

Versus

The State of U.P. and others . Respondents

WITH

CIVIL APPEAL NO.3789 OF 1992

Bhiwani Improvement Trust . Appellant

Versus

Kali Charan and others . Respondents

WITH

SPECIAL LEAVE PETITION (CIVIL) No.12949 of 1992

Bhiwani Improvement Trust . Appellant

Versus

Kali Charan and others . Respondents

WITH

SPECIAL LEAVE PETITION (CIVIL) No.3331 of 1993

Bhiwani Improvement Trust . Appellant

Versus

Haricharan, Girdhari Lal and another . Respondents

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WITH

CIVIL APPEAL NO.9207 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

Daljinder Singh and others . Respondents

WITH

CIVIL APPEAL NO.9206 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

Gurjaipal Singh (dead) by L.Rs.and others . Respondents

WITH

SPECIAL LEAVE PETITION (CIVIL) NO. 3210 OF 1999

Jalandhar Improvement Trust . Appellant

Versus

Krishan Kumar and others . Respondents

WITH

CIVIL APPEAL NO.9211 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

President Improvement Trust Tribunal

Jalandhar and others . Respondents

WITH

CIVIL APPEAL NO.9212 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

President Acquisition Tribunal

and others . Respondents

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WITH

CIVIL APPEAL NO.9208 OF 1995

Jalandhar Improvement Trust . Appellant

Versus

President Land Acquisition Tribunal

and others . Respondents

WITH

CIVIL APPEAL NO.6590 OF 2001

Ram Gopal . Appellant

Versus

Collector, Agra and others . Respondents

WITH

CIVIL APPEAL NO.6591 OF 2001

M/s. Bhagwan Das Tara Chand . Appellant

Versus

Collector, Agra and others . Respondents

WITH

CIVIL APPEAL NO.6592 OF 2001

Navin Chand Bansal . Appellant

Versus

Collector, Agra and others . Respondents

J U D G M E N T

B.P. SINGH, J.

In this batch of appeals and special leave petitions the

common question which arises for consideration is whether the

provisions of the Land Acquisition Act, 1894, particularly Sections

6, 23(2) and 28 thereof stand incorporated in the three State Acts

with which we are concerned in these matters or whether the Land

Acquisition Act has been merely referred to in the State Acts. If it

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is held that the provisions of the Land Acquisition Act stand

legislatively incorporated in the State Acts, the subsequent

amendments to the Land Acquisition Act will have no effect upon

the acquisitions made under the State Acts. We are concerned with

three State Acts, namely, The Punjab Town Improvement Act,

1922 (hereinafter referred to as 'the Punjab Act') ; The Nagpur

Improvement Trust Act, 1936 (hereinafter referred to as 'the

Nagpur Act') and The Uttar Pradesh Avas Evam Vikas Parishad

Adhiniyam, 1965 (hereinafter referred to as 'the U.P. Act').

C.A. Nos. 9206 to 9214 of 1995; C.A. Nos. 9260-9261 of

1995; C.A. No. 3789 of 1992; SLP (C) No. 12949/1992; SLP (C)

No. 3331/1993 & SLP (C) No. 3210/1999 relate to acquisitions

made under the Punjab Act. C.A. No. 839 of 1995 and C.A. Nos.

6590 to 6292 of 2001 relate to acquisitions under the U.P. Act

while C.A. Nos. 1164-2000 of 1993 and SLP (C) Nos. 8256-8259

of 1993 relate to acquisitions made under the Nagpur Act.

In the matters arising under the Punjab Act, the High Court

of Punjab and Haryana held that the claimants, whose lands were

acquired under the Punjab Act were entitled to additional

compensation under Section 23(1-A) of the Land Acquisition

(Amendment) Act, 1984 as also to the solatium under Section

23(2) and interest under Section 28 of the Land Acquisition Act as

amended by Act 68 of 1984. The Court relied upon the judgment

of this Court in Union of India and Anr. Vs. Zora Singh and Ors.

(1992) 1 SCC 673: Nagpur Improvement Trust and another vs.

Vithal Rao and others : AIR 1973 SC 689 as also the full Bench of

that Court in Harbans Kaur and others vs. Ludhiana

Improvement Trust and others : 1973 P.L.J. 250.

In the appeals which relate to the acquisitions under the

Nagpur Act, the appellant, namely the Nagpur Improvement Trust,

has impugned the judgment and order of the High Court of

Bombay (Nagpur Bench), Nagpur, holding that the Land

Acquisition Act is merely referred to in the Nagpur Act and,

therefore, the provisions of Section 6 including the proviso thereto

apply to acquisitions under the Nagpur Act. Since the notice under

Section 39 of the Nagpur Act corresponding to the Notification

under Section 4 of the Land Acquisition Act was first published in

the official gazette on 25th December, 1969 and the subsequent

Notification under Section 45 corresponding to the declaration

under Section 6 of the Land Acquisition Act was published on 18th

September, 1974 i.e. after more than three years, the same deserves

to be quashed since the notice published under Section 39 of the

Act lapsed on expiry of three years from the date of its publication,

and no action pursuant to the said notice could have been taken

thereafter.

In Civil Appeal No. 839 of 1995 which arises under the U.P.

Act, the High Court of Judicature at Allahabad dismissed the writ

petitions challenging the acquisitions before it holding that Section

6 of the Land Acquisition Act was legislatively incorporated in the

U.P. Act which was of the year 1965, and that the subsequent

amendment of Section 6 of the Land Acquisition Act in the year

1967 did not affect the provisions of the U.P. Act including

Section 6 of the Land Acquisition Act as incorporated in the U.P.

Act. It, therefore, rejected the contention urged on behalf of the

petitioners that acquisition proceedings lapsed on expiry of the

period of three years from the date of issuance of Notification

under Section 28 of the U.P. Act which corresponds with Section 4

of the Land Acquisition Act. The High Court relied upon its Full

Bench decision in Doctors Sahakari Gram Nirman Samiti Ltd. vs.

Avas and Vikas Parishad etc. , AIR 1984 Allahabad 234.

In Civil Appeal Nos. 6590-6592 of 2001, the sole question is

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whether the claimants are entitled to interest on the sum payable

under Section 23 of the Land Acquisition Act.

The Punjab Act was enacted to make provision for the

improvement and expansion of towns in Punjab. The Nagpur Act

also makes provisions for the improvement and expansion of the

town of Nagpur. The U.P. Act has the same objective but applies

to whole of the State of Uttar Pradesh, excluding the Cantonment

areas. All these State Acts incorporate a similar scheme and

follow a common pattern. They provide for the constitution of

Trust or Board, as the case may be, and also provide for various

schemes for the improvement and expansion of the areas covered

by the Act. All the three Acts provide for acquisition of land in

accordance with the provisions of the Land Acquisition Act subject

to the modifications made thereto by the Act and/or the Schedule

to the Act. In a nutshell, the provisions of the Land Acquisition

Act are made applicable to the acquisitions made under the State

Acts subject to certain modifications as indicated in the Act and/or

the Schedule thereto.

Before we advert to the submissions urged at the Bar we

may briefly notice the scheme under the said Acts.

The Punjab Act provides for the creation and incorporation

of Trusts which are charged with the duty of carrying out the

provisions of the Act in the local area within their jurisdiction.

Provisions have been made for the constitution of the Trusts and

the manner in which the proceedings of the Trusts and their

Committees are to be conducted. Chapter IV of the Act deals with

the schemes which may be framed under the Act, which include

general improvement scheme or rebuilding scheme; street schemes

and deferred street schemes ; development and expansion schemes;

housing accommodation scheme ; re-housing scheme etc. Under

Section 36 of the Act when a Scheme is framed, the Trust shall

prepare a notice stating the fact that the scheme has been framed

and prescribe the boundaries of the locality comprised in the

scheme and furnish requisite particulars. Such a notice is required

to be published weekly for three consecutive weeks in the Official

Gazette and in a newspaper or newspapers with a statement of the

period within which objections will be received. Under Section

38, during the thirty days next following the first day on which any

notice is published under Section 36 in respect of any scheme

under the Act, the Trust is required to serve a notice on every

person, whom the Trust has reason to believe, to be the owner of

any immovable property which it is proposed to acquire in

executing the scheme and the occupier of such premises. Under

Section 41 the State Government may sanction, either with our

without modification, or may refuse to sanction, or may return for

reconsideration, any scheme submitted to it under Section 40 of the

Act. In case scheme is sanctioned by the State Government,

Section 42 mandates the State Government to notify the sanction

of the scheme under the Act whereafter the Trust shall proceed to

execute the scheme in accordance with the provisions of the Act.

A notification under sub-section (1) of Section 42 in respect of any

scheme is conclusive evidence that the scheme has been duly

framed and sanctioned. Chapter V deals with the powers and

duties of the Trust where the scheme has been sanctioned. Chapter

VI deals with the acquisition proceedings and the application of the

Act to other authorities. Section 56 thereunder enables the State

Government to abandon the acquisition of land in certain cases on

payment being made of a sum to be fixed by the Trust. A Tribunal

is constituted under Section 58 for the purpose of performing the

functions of the Court in reference to the acquisition of land for the

Trust under the Land Acquisition Act, 1894. Section 59 is of

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considerable significance and is, therefore, reproduced below :-

"59. Modification of the Land Acquisition

Act, 1894 For the purpose of acquiring

land under the Land Acquisition Act, 1984,

for the trust

(a) the tribunal shall (except for the

purposes of section 54 of the said Act)

be deemed to be the Court, and the

president of the tribunal shall be deemed

to be the Judge, under the said Act :

(b) the said Act shall be subject to the

further modifications indicated in the

Schedule to this Act;

( c) the president of the tribunal shall have

power to summon and enforce the

attendance of witnesses, and to compel

the production of documents by the same

means and (so far as may by) in the

same manner as is provided in the case

of a Civil Court under the Code of Civil

Procedure, 1908 ; and

(d) the award of a tribunal shall be deemed

to be the award of the Court under the

Land Acquisition Act, 1894, and shall be

final".

The Schedule to the Act is also of considerable

significance since it seeks to modify the provisions of the Land

Acquisition Act in its application to acquisitions under the

Punjab Act. Paragraph 2 of the Schedule reads as under :-

"2. Notification under section 4 and

declaration under section 6 to be replaced

by notification under sections 36 and 42 of

this Act. (1) The first publication of a

notice of any improvement scheme under

section 36 of this Act shall be substituted for

and have the same effect as publication in

the Official Gazette and in the locality of a

notification under sub-section (1) of section

4 of the said Act, except where a declaration

under section 4 or section 6 of the said Act

has previously been made and is still in

force.

(2) Subject to the provisions of

clauses 10 and 11 of this Schedule, the issue

of a notice under sub-section 32 (1) of

section in the case of land acquired under

that sub-section and in any other case the

publication of a notification under section 42

shall be substituted for and have the same

effect as a declaration by the State

Government under section 6 of the said Act,

unless a declaration under the last mentioned

section has previously been made and is still

in force".

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Various clauses of the schedule seek to amend sections

11, 15, 17, 18, 19, 20, 23, 24, 31 & 49 of the Land Acquisition

Act. Two new provisions have been inserted, namely Sections

24A and 48A. The relevant part of paragraphs 6 and 10 of the

schedule which seek to add Section 17-A and modify Section

23 of the Land Acquisition Act are as follows :-

"6. Transfer of land to Trust - After section

17 of the said Act, the following shall be

deemed to be inserted, namely :-

17-A. In every case referred to in section 16

or section 17, the Collector shall, upon

payment of the cost of acquisition, make

over charge of the land to the trust, and the

land shall thereupon vest in the trust subject

to the liability of the trust to pay any further

costs which may be incurred on account of

its acquisition".

"10. Amendment of section 23. (1) In

clause first and clause sixthly of sub-section

(1) of section 23 of the said Act, for the

words "publication of the declaration

relating thereto under section 6" and the

words "publication of the declaration under

section 6", shall be deemed to be

substituted.

(a) if the land is being acquired under

sub-section (3) of section 32 of this

Act the words "issue of the notice

under sub-section (3) of section 32 of

the Punjab Town Improvement Act,

1922," and

(b) in any other case, the words "first

publication of the notification under

section 36 of the Punjab Town

Improvement Act, 1922".

(2) The fullstop at the end of sub-section

(2) of section 23 of the said Act shall be

deemed to be changed to a colon and the

following proviso shall be deemed to be

added :-

Provided that this sub-section shall

not apply to any land acquired under the

Punjab Town Improvement Act, 1922."

Section 48A reads as under :-

" 48-A. Compensation to be awarded when

land not acquired within one year. - (1) If

within a period of one year, from the date of

the publication of the declaration under

section 6 in respect of any land, the

Collector has not made an award under

section 11 with respect to such land, the

owner of the land shall, unless he has been

to a material extent responsible for the

delay, be entitled to receive compensation

for the damage suffered by him in

consequence of the delay.

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(2) The provision of part III of this

Act shall apply, so far as it may to the

determination of the compensation payable

under this section."

The Nagpur Act, namely the Nagpur Improvement

Trust Act, 1936, follows the same pattern. Chapter II of the Act

deals with the Constitution of the Trust and Chapter III deals

with the proceedings of the Trust and the Committees. Chapter

IV deals with various improvement schemes contemplated by

the Act. Section 26 provides that an improvement scheme may

provide for all or any of the matters provided therein which

includes the acquisition by purchase, exchange, or otherwise of

any property necessary for or affected by the execution of the

scheme; recovery of betterment contributions; the re-laying out

of any land comprised in the scheme, the construction and re-

construction of buildings ; the provisions of parks, playing-

fields and open spaces etc; sanitary arrangements required for

the area; reclamation or reservation of land for market, gardens,

afforestation etc. etc. It also includes any matter for which, in

the opinion of the State Government, it is expedient to make

provision with a view to the improvement of any area in

question or the general efficiency of the scheme. Various

schemes have been specified such as a general improvement

scheme; a re-building scheme; a re-housing scheme; a street

scheme; a deferred street scheme; a house accommodation

scheme etc. etc. Sections 36 to 47 prescribe the procedure to

be followed in framing an improvement scheme. Section 39

provides that when any improvement scheme has been framed,

the Trust shall prepare a notice stating the fact that the scheme

has been framed; the boundaries of the area comprised in the

scheme and such other particulars as are specified in that

section. Under Section 41, during the thirty days next

following the first day on which any notice is published under

Section 39 in respect of any improvement scheme, the Trust

shall serve a notice on every person whose name appears in the

Municipal assessment list of land as owner of any building or

land which it proposed to acquire in executing the scheme or in

regard to which it proposed to recover a betterment

contribution. The notice shall state that the Trust propose to

acquire such land or to recover such betterment contribution for

the purposes of carrying out an improvement scheme. The

notice shall call upon such person, if he dissents from such

acquisition or from the recovery of such betterment

contribution, to state his reason in writing within a period of

sixty days from service of the notice. The objections are,

thereafter, to be considered under Section 43 within the period

prescribed. The objectors are entitled to be heard in the matter

if they so desire, whereafter the Trust may either abandon the

scheme or apply to the State Government for sanction of the

scheme with such modification, if any, as the Trust may

consider necessary. Thereafter the State Government may

sanction either with or without modification, or may refuse to

sanction, or may return for reconsideration, any improvement

scheme submitted to it under Section 43. Section 45 provides

that whenever the State Government sanctions an improvement

scheme, it shall announce the fact by notification and the Trust

shall forthwith proceed to execute the same. The publication of

a notification under sub-section (1) of Section 45 in respect of

any scheme shall be conclusive evidence that the scheme has

been duly framed and sanctioned. Section 46 authorises the

Trust to alter any improvement scheme after the same has been

sanctioned subject to the previous sanction of the State

Government, if required. Chapter V of the Act lays down the

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powers and duties of the Trust where a scheme has been

sanctioned. Chapter VI deals with the acquisition and disposal

of land. Section 58 provides for acquisition by purchase, lease

or exchange by the Trust pursuant to an agreement with the

person concerned. Section 59 reads as follows :-

"59. The Trust may, with the previous

sanction of the State Government acquire,

land under the provisions of the Land

Acquisition Act, 1894, as modified by the

provisions of this Act, for carrying out any

of the purposes of this Act."

Section 60 provides for the constitution of Tribunal for

the purposes of performing the functions of the Court in

reference to the acquisition of land for the Trust, under the Land

Acquisition Act, 1894. Section 61 reads as under :-

"61. For the purpose of acquiring land

under the Land Acquisition Act, 1894, for

the Trust, -

(a) the Tribunal shall except for the

purposes of section 54 of that Act, be

deemed to be the Court, and the

President of the Tribunal shall be

deemed to be the Judge thereunder ;

(b) the Act shall be subject to the further

modifications as indicated in the

Schedule ;

(c) the President of the Tribunal may

summon witnesses and enforce their

attendance and may compel the

production of documents by the same

means, and so far as may be, in the same

manner, as is provided in case of a Civil

Court under the Code of Civil

Procedure, 1908 ; and

(d) the award of the Tribunal shall be

deemed to be the award of the Court

under the Land Acquisition Act, 1894,

and shall be final".

It is not necessary to refer to other provisions of the Act.

However, the Schedule to the Act provides for further

modification of the Land Acquisition Act, 1894. Clauses 2 and

3 of the Schedule are significant and they are reproduced

below:-

"2. (1) The first publication of a notice of

an improvement scheme under section 39 of

the Nagpur Improvement Trust Act, 1936,

shall be substituted for, and have the same

effect as publication in the official Gazette

and in the locality of, a notification under

sub-section (1) of section 4, except where a

declaration under section 4 or section 6 has

previously been made and is still in force.

(2) Subject to the provisions of

clauses 10 and 11 of this Schedule, the issue

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of notice under sub-section (4) of section 32

of the Nagpur Improvement Trust Act 1936,

in the case of land acquired under that sub-

section, and in any other case the publication

of a notification under section 45 of the

Nagpur Improvement Trust Act, 1936, shall

be substituted for, and have the same effect

as a declaration by the State Government

under section 6, unless a declaration under

the last mentioned section has previously

been made and is in force.

(3) The full stop at the end of section 11

shall be deemed to be changed to a semi-

colon, and the following shall be deemed to

be added, namely:--

"and

(iv) the costs which, in his opinion, should

be allowed to any person who is found to be

entitled to compensation, and who is not

entitled to receive the additional sum of

fifteen per centum mentioned in sub-section

(2) of section 23 as having been actually and

reasonably incurred by such person in

preparing his claim and putting his case

before the Collector.

The Collector may disallow, wholly

or in part, costs incurred by any person, if he

considers that the claim made by such

person for compensation is extravagant."

The Schedule further amends Sections 15, 17, 18, 19, 20,

23, 24 & 31 of the Land Acquisition Act. The schedule inserts

two new provisions, namely Section 24-A and Section 48-A.

Section 17-A which has been added by clause 6 of the Schedule

reads as under:-

" 6. After section 17, the following section

shall be deemed to be inserted, namely :-

17-A. In every case referred to in section 16

or section 17, the Collector shall, upon

payment of the cost of acquisition, make

over charge of the land to the Trust and the

land shall thereupon vest in the Trust,

subject to the liability of the Trust to pay

any further costs which may be incurred on

account of its acquisition."

Clause 10 of the schedule which effects several

modifications in Section 23 of the Land Acquisition Act,

modifies sub-section (2) thereof as follows :-

"(2) The full stop at the end of sub-section

(2) of section 23 shall be deemed to be

changed to a colon, and the following

proviso shall be deemed to be added :-

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Provided that this sub-section shall

not apply to any land acquired under the

Nagpur Improvement Trust Act, 1936,

except

(a) buildings in the actual occupation of

the owner or occupied free of rent by

a relative of the owner, and land

appurtenant thereto, and

(b) gardens not let to tenants but used by

the owners as a place of resort."

Similar is the scheme under the U.P. Act which has been

noticed by this Court in U.P. Avas Evam Vikas Parishad vs.

Jainul Islam and another : (1998) 2 SCC 467.

It will thus be seen that the three State Acts follow the

same pattern and incorporate a common scheme. The

provisions of the Land Acquisition Act with certain

modifications are made applicable to acquisitions made for

purposes of execution of the schemes under those Acts. There

is also a striking similarity between schedules to the Punjab and

Nagpur Acts, and even though they may not be identical they

are in pari materia. The schedule to the U.P. Act is not as

detailed but that is due to the fact that many of the

modifications in the Land Acquisition Act have been brought

about by the provisions of the Act itself. The schedule modifies

sections 17, 23 and 49 of the Land Acquisition Act, and adds a

new section 17-A which is identical to Section 17-A inserted in

Punjab and Nagpur Acts. It also gives to the notifications under

Section 28(1) and 32(1) of the U.P. Act, the same effect as

notifications published under Sections 4 and 6 respectively of

the Land Acquisition Act.

Mr. Rajinder Sachar, learned Senior Counsel appearing

on behalf of Jalandhar Improvement Trust in Civil Appeal

No.9206 of 1995 submitted that a careful analysis of the

scheme of the Punjab Act would disclose that the scheme of the

Punjab Act is quite different from the scheme of the Land

Acquisition Act. Different equities arose under the two Acts

and, therefore, the High Court was not justified in holding that

even in respect of the acquisition under the Punjab Act, the

claimants were entitled to the benefit of beneficial provisions

under the Land Acquisition Act as brought in by amending the

Land Acquisition Act by Act No. 68 of 1984. He sought to

distinguish the judgments relied upon by the respondents and

submitted that having regard to the principle laid down by this

Court in Maneklal Chhotalal and others vs. M.G. Makwana

and others : [1967] 3 SCR 65 and State of Gujarat vs.

Shantilal Mangaldas and others : (1969) 1 SCC 509, it must be

held that compensation was not justiciable and since the two

legislations were under two different entries of the Constitution,

Article 14 could not be invoked.

Mr. Rakesh Dwivedi, Senior Advocate, appearing on

behalf of the Nagpur Improvement Trust in C.A. Nos. 1164-

1200 of 1993 and the Uttar Pradesh Avas Evam Vikas Parishad

in Civil Appeal No.839 of 1995 submitted that the provisions of

the Nagpur and the U.P. Act and the modifications brought

about by these Acts leave no room for doubt that the provisions

of the Land Acquisition Act stood incorporated by legislation in

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the State Acts and, therefore, it cannot be said that the

legislature intended that subsequent amendments in the Land

Acquisition Act, 1894 should apply to an acquisition under the

said Act. He further submitted that this Court in Bhatinda

Improvement Trust vs. Balwant Singh and others : (1991) 4

SCC 368 over-looked a judgment of this Court in State of

Kerala and others vs. T.M. Peter and others : (1980) 3 SCC

554 and erroneously came to the conclusion that there was no

question of incorporation of any of the provisions of the Land

Acquisition Act into the Punjab Act. A perusal of the

provisions of the Nagpur Act would show that the provisions of

the Land Acquisition Act, 1894 as it stood in 1936 stand

incorporated by reference in the 1936 Act subject to the

modifications indicated therein. The Nagpur Act is a complete

and exhaustive code enacted with the object of providing for

improvement and expansion of the town of Nagpur. The Act

also contemplates under Section 58 acquisition by agreement

while Sections 59 to 68 deal with compulsory acquisition under

the provisions of the Land Acquisition Act as modified by the

provisions of the Nagpur Act. The Nagpur Act has its own

exhaustive mechanism and procedure for acquisition of land

and further it adopts provisions of Land Acquisition Act, 1894

as it stood in 1936 with specific, numerous, and detailed

modifications which make out a clear case of incorporation of

Land Acquisition Act, 1894 as it then stood with modifications.

He further contended that it cannot be that the legislature

intended that subsequent amendments in the Land Acquisition

Act, 1894 should automatically apply to the Nagpur Act.

So far as the U.P. Act is concerned, Shri Dwivedi

submitted that having regard to the scheme of the Act and the

modifications to the Land Acquisition Act, 1894, it was also a

case of incorporation of the provisions of the Land Acquisition

Act, 1894 as amended in its application to the State of U.P.

subject to the modifications contained in the Schedule to the

Adhiniyam. A separate exhaustive code exists for acquisition

under the Adhiniyam. He, however, submitted that while

applying Article 14, the nature of the provision of the

enactment under consideration becomes important. Mere

absence of a limitation of time period for issuance of a

declaration under Section 6 would not imply a breach of Article

14 and for this he relied upon the judgment of this Court in

State of Kerala and others vs. T.M. Peter and others (supra).

He further submitted that the provisions pertaining to

compensation would be different from the provisions pertaining

to the time limit for notifying sanction of the draft scheme. The

latter would be a procedural provision which may, indirectly,

impact compensation by increasing or decreasing it depending

upon the market situation. Therefore, the cases of this court

pertaining to compensation being equal to the compensation

paid under the Land Acquisition Act in view of Article 14 of

the Constitution of India, would have no applicability for

invoking the proviso to Section 6 of the Land Acquisition Act

in respect of the scheme under the Nagpur Act and

consequently the principles laid down by this Court in Nagpur

Imrovement Trust and another vs. Vithal Rao and others

(supra) would not be attracted. He, therefore challenged the

correctness of the impugned judgment and order of the High

Court of Bombay, Nagpur Bench, Nagpur holding that the

proviso to Section 6 applies to acquisition made under the

Nagpur Act, 1936 and supported the judgment of the Allahabad

High Court holding that the said proviso has no application to

the acquisition made under the U.P. Act.

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Mr. V.A. Mohta, Senior Advocate, appearing on behalf

of the respondents, in C.A. Nos. 1164-1200 of 1993 and

appellants in C.A. No. 839 of 1995 relating to the acquisitions

made under the Nagpur Act and the U.P. Act submitted that the

questions which arise in these matters are :-

1) Whether the provisions of the Land Acquisition Act,

as modified, stand incorporated in the said Acts?

2) Whether the decision of this Court in Nagpur

Improvement Trust vs. Vithal Rao (supra) is confined

to cases of grant of compensation or whether the said

principle would also apply to the issuance of

Notifications under Sections 4 and 6 of the Land

Acquisition Act ? and

3) If it is held that the provisions of the Land

Acquisition Act stand incorporated whether it would

not fall within any of the four exceptions enunciated

in The State of Madhya Pradesh vs. M.V.

Narasimhan : (1975) 2 SCC 377 ?

On the first question he relied upon the opinion of Sahai,

J. in Gauri Shankar Gaur and others vs. State of U.P. and

others : (1994) 1 SCC 92 but conceded that the said view has

not been approved by this Court by a larger Bench in U.P. Avas

Evam Vikas Parishad vs. Jainul Islam and another : (1998) 2

SCC 467. He pointed out that even though the Nagpur

Improvement Trust vs. Vithal Rao (supra) dealt with a matter

which was confined to the question of compensation, the same

principle should apply to cases where the application of proviso

to Section 6 of the Land Acquisition Act is involved. Lastly he

contended that this Court must hold that the provisions of the

State Acts were supplemental in nature and are, therefore,

covered by the first exception enunciated in State of Madhya

Pradesh vs. M.V. Narasimhan : (1975) 2 SCC 377.

Shri K.C. Jain appearing on behalf of the respondents in

C.A. No.1166 of 1993, an appeal preferred by the Nagpur

Improvement Trust, submitted that Section 59 as well as

Section 61(b) of the Nagpur Act simply cites/refers to the Land

Acquisition Act and does not incorporate it referentially. Hence

all the amendments made to the Land Acquisition Act must

apply automatically. In the alternative he submitted that even if

it is assumed that the aforesaid provisions incorporate the Land

Acquisition Act as it then existed in the year 1936, it falls in

exceptional situations carved out by this Court, namely that it is

supplemental to the Land Acquisition Act and, therefore,

incidences of incorporation shall not follow. He supported the

reasoning in Jainul Islam's case (supra) and submitted that not

applying the amendment leads to unconstitutionality of the Act.

He distinguished the decisions of this Court in Prakash

Amichand Shah vs. State of Gujarat and others : (1986) 1

SCC 581 and State of Gujarat vs. Shantilal Mangaldas and

others (supra) and submitted that those decisions relate to

Bombay Town Planning Act and were distinguishable. So far

as the instant controversy is concerned, according to him, it

stands clearly covered by the decision of this Court in Nagpur

Improvement Trust vs. Vithal Rao (supra).

Mr. N.N. Goswami, learned Senior counsel appearing on

behalf of the respondents in C.A. No.9212 of 1995 supported

the impugned judgment of the High Court of Punjab and

Haryana awarding solatium and interest under the beneficial

provisions of the Land Acquisition Act as amended in the year

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1984. He relied upon the decision of this Court in Nagpur

Improvement Trust vs. Vithal Rao (supra) and submitted that

the provisions of the Punjab Act will have to be struck down as

discriminatory if the claimants are not given benefit of the

beneficial provisions of the Land Acquisition Act as amended

in the year 1984. He further submitted that the provisions of

the Punjab Act also provide for payment of solatium and there

is no reason why interest should not be granted to the claimants

who would otherwise be granted such interest under the

provisions of the Land Acquisition Act, as amended.

Counsel appearing in the other matters have adopted the

submissions advanced by the learned Senior counsel whose

submissions we have noticed above.

Numerous decisions have been cited before us by learned

counsel appearing for the parties. We do not consider it

necessary to refer to all of them because several authorities

have been cited for the same proposition. Moreover some of

the issues involved appear to be clearly covered by a decision

of this Court rendered by a Bench comprising of three judges

which is a binding precedent. However, we shall notice such of

them as appear relevant for decision of the appeals and special

leave petitions before us.

At the outset we may dispose of Civil Appeal Nos. 6590

to 6592 of 2001. This Court by its order dated September 19,

2001 has already upheld the contention of the appellants that

they are entitled to interest on the amount envisaged in Section

23(2) of the Land Acquisition Act. In these three appeals,

therefore, the sole question that survives for consideration is

whether the appellants whose lands have been acquired under

the Land Acquisition Act are also entitled to interest on the sum

payable under sub-section (1-A) of Section 23 of the Land

Acquisition Act, 1894. The High Court by its impugned

judgment and order following the earlier decision of this Court

in Prem Nath Kapur and another vs. National Fertilizers

Corporation of India Limited and others : (1996) 2 SCC 71,

dismissed the writ petitions preferred by the appellants holding

them to be not entitled to interest on the sum payable under

Section 23(1-A) of the Land Acquisition Act. The matter was

reconsidered by a Larger bench of this Court and the question

now stands concluded by an authoritative pronouncement of

this Court in Sunder vs. Union of India : 2001 (7) SCC 211

holding that the claimant is entitled to interest on the amount of

compensation worked out in accordance with the provisions of

Section 23 of the Land Acquisition Act including all the sub-

sections thereof, meaning thereby sub-sections (1), (1-A) and

(2) of Section 23. This Court held:-

"No judicial exercise is required to quantify

the sums mentioned in sub-section (1-A) or

sub-section (2) because the section itself

specifies the percentage to be worked out for

the purpose of adding to the total amount

arrived at under sub-section (1). Otherwise

Section 26 is not intended to show that the

compensation awarded would be bereft of

the additional amount and the solatium

envisaged under sub-section (1-A) or sub-

section (2). This can be clearly discerned

from the commencing words of Section 26

itself. They are: "Every award under this

Part shall be in writing signed by the Judge".

What is referred to therein is Part III of the

Act which comprises of a fasciculus of

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twelve provisions starting with Section 18

and ending with Section 28-A of the Act.

There can be no doubt that all the three

heads specified in the three sub-sections in

Section 23 are the sums to be "awarded by

the court". Hence the words "every award

under this Part" cannot be treated as the

award after delinking the amounts awarded

under sub-section (1-A) or sub-section (2) of

Section 23.

* * * *

The remaining sub-sections in that provision

only deal with the contingencies in which

the Collector has to deposit the amount

instead of paying it to the party concerned.

It is the legal obligation of the Collector to

pay "the compensation awarded by him" to

the party entitled thereto. We make it clear

that the compensation awarded would

include not only the total sum arrived at as

per sub-section (1) of Section 23 but the

remaining sub-sections thereof as well. It is

thus clear from Section 34 that the

expression "awarded amount" would mean

the amount of compensation worked out in

accordance with the provisions contained in

Section 23, including all the sub-sections

thereof".

These appeals (Civil Appeal Nos. 6590 to 6592 of 2002)

deserve to be allowed and the impugned judgments and orders

of the High Court set aside, and the respondents directed to

compute and pay the interest payable to the appellants in

accordance with law as enunciated in Sunder vs. Union of

India (supra).

We shall now proceed to consider whether the provisions

of the Land Acquisition Act, 1894 as modified by the State

Acts stand incorporated in the State Acts or whether there is a

mere reference or citation of the land Acquisition Act in the

State Acts. The law on the subject is well settled. When an

earlier Act or certain of its provisions are incorporated by

reference into a later Act, the provisions so incorporated

become part and parcel of the later Act as if they had been

bodily transposed into it. The incorporation of an earlier Act

into a later Act is a legislative device adopted for the sake of

convenience in order to avoid verbatim reproduction of the

provisions of the earlier Act into the later. But this must be

distinguished from a referential legislation which merely

contains a reference or the citation of the provisions of an

earlier statute. In a case where a statute is incorporated, by

reference, into a second statute, the repeal of the first statute by

a third does not affect the second. The later Act alongwith the

incorporated provisions of the earlier Act constitute an

independent legislation which is not modified or repealed by a

modification or repeal of the earlier Act. However, where in

later Act there is a mere reference to an earlier Act, the

modification, repeal or amendment of the statute that is

referred, will also have an effect on the statute in which it is

referred. It is equally well settled that the question whether a

former statute is merely referred to or cited in a later statute, or

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whether it is wholly or partially incorporated therein, is a

question of construction.

In Secretary of State vs. Hindustan Cooperative

Insurance Society Ltd. : AIR 1931 PC 149, the Privy Council

observed :-

"In this country it is accepted that where a

statute is incorporated by reference into a

second statute, the repeal of the first statute

does not affect the second: see the cases

collected in "Craies on Statute law," Edn.3,

pp. 349-50. This doctrine finds expression

in a common-form section which regularly

appears in the Amending and Repealing

Acts which are passed from time to time in

India. The section runs,

The repeal by this Act of any

enactment shall not affect any Act.

in which such enactment has been

applied, incorporated or referred to."

The independent existence of the two

Acts is therefore recognized; despite the

death of the parent Act, its offspring

survives in the incorporating Act. Though

no such saving clause appears in the General

Clauses Act, their Lordships think that the

principle involved is as applicable in India

as it is in this country.

It seems to be no less logical to hold

that where certain provisions from an

existing Act have been incorporated into a

subsequent Act, no addition to the former

Act, which is not expressly made applicable

to the subsequent Act, can be deemed to be

incorporated in it, at all events if it is

possible for the subsequent Act to function

effectually without the addition."

In Re : Wood's Estate, Ex parte, Works and Buildings

Commrs., (1886) 31 Ch D 607 at page 615 Lord Esher, M.R.

observed :-

"If a subsequent Act brings into itself by

reference some of the clauses of a former

Act, the legal effect of that, as has often

been held, is to write those sections into the

new Act as if they had been actually written

in it with the pen, or printed in it."

In U.P. Avas Evam Vikas Parishad vs. Jainul Islam and

another (supra) this Court observed :-

"17. A subsequent legislation often makes

a reference to the earlier legislation so as to

make the provisions of the earlier legislation

applicable to matters covered by the later

legislation. Such a legislation may either be

(i) a referential legislation which merely

contains a reference to or the citation of the

provisions of the earlier statute; or (ii) a

legislation by incorporation whereunder the

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provisions of the earlier legislation to which

reference is made are incorporated into the

later legislation by reference. If it is a

referential legislation the provisions of the

earlier legislation to which reference is made

in the subsequent legislation would be

applicable as it stands on the date of

application of such earlier legislation to

matters referred to in the subsequent

legislation. In other words, any amendment

made in the earlier legislation after the date

of enactment of the subsequent legislation

would also be applicable. But if it is a

legislation by incorporation the rule of

construction is that repeal of the earlier

statute which is incorporated does not affect

operation of the subsequent statute in which

it has been incorporated. So also any

amendment in the statute which has been so

incorporated that is made after the date of

incorporation of such statute does not affect

the subsequent statute in which it is

incorporated and the provisions of the

statute which have been incorporated would

remain the same as they were at the time of

incorporation and the subsequent

amendments are not to be read in the

subsequent legislation."

This is a reiteration of the principle as laid down by

earlier judgments of this Court in a catena of decisions

including Mary Roy vs. State of Kerala (1986) 2 SCC 209 ;

Ramsarup vs. Munshi : AIR 1963 SC 553 ; Ram Kripal

Bhagat vs. State of Bihar : AIR 1970 SC 951 ; Bolani Ores

Ltd. vs. State of Orissa : AIR 1975 SC 17 ; Mahindra and

Mahindra Ltd. vs. Union of India : AIR 1979 SC 798.

It is also well settled that the question as to whether a

particular legislation falls in the category of referential

legislation or legislation by incorporation depends upon the

language used in the statute in which reference is made to the

earlier decision and other relevant circumstances.

In Bhatinda Improvement Trust vs. Balwant Singh and

others (supra) a question arose regarding the applicability of the

first proviso of Section 6(1) of the Land Acquisition Act, 1894

as substituted by Act 68 of 1984 to an improvement scheme

under the Punjab Act providing for acquisition of the land

under the Land Acquisition Act. In that case the first notice

published under Section 36(2) of the Punjab Act in May, 1977

was followed by a Notification under Section 42 published in

June, 1980 sanctioning the scheme. Since the notice under

Section 42 was issued after the expiry of the period of three

years from the date of the publication of the Notification under

Section 36(2) of the Punjab Act, it was contended that the

acquisition proceeding lapsed. Upholding the contention the

Court held that the first proviso to Section 6(1) of the Land

Acquisition Act was applicable since there was no question of

incorporation of any of the provisions of the Land Acquisition

Act into the Punjab Act. This Court observed that the Punjab

Act did not deal with acquisition of land for the purposes of a

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scheme as contemplated thereunder. The acquisition of such

land for the purposes of the scheme is left to the general law of

the land, namely the Land Acquisition Act which has to be

resorted to for the acquisition of land for the purposes of the

schemes contemplated under the Punjab Act. The only

difference is that some of the provisions of the Land

Acquisition Act, as referred to in the relevant sections of the

Punjab Act, are given effect to as amended by the relevant

sections of the Punjab Act. In these circumstances, it cannot be

held that any provisions of the Land Acquisition Act have been

incorporated into the Punjab Act and, therefore, the provisions

of the Land Acquisition Act, as they stood at the time of

acquisition, would be applicable in the absence of any contrary

intention. The judgment was rendered by a bench of two

Judges of this Court. The same question again arose in Gauri

Shankar Gaur and others vs. State of U.P. and others (supra)

in the context of the provisions of the U.P. Act. A two Judge

Bench of this Court upheld the validity of the acquisition but

the learned judges recorded different reasons for coming to the

same conclusion. After referring to a large number of decisions

of this Court Ramaswami, J. recorded his conclusion in the

following words:-

"33. Section 55 of the Act read with the

schedule made an express incorporation of

the provisions of Section 4 (1) and Section 6

as modified and incorporated in the

schedule. The schedule effected necessary

structural amendments to Sections 4, 6, 17

and 23 incorporating therein the procedure

and principles with necessary modifications.

Sections 28(2) and 32(1) prescribe

procedure for publication of the notifications

under Sections 28(1) and 32(1) of the Act

without prescribing any limitation. It is a

complete code in itself. The Act is not

wholly unworkable or ineffectual though

may be incompatible with provisos to

Section 6(1) of the Land Acquisition Act.

The U.P. Legislature did not visualize that

later amendment to Central Act 1 of 1894

i.e. Land Acquisition Act would be

automatically extended. We have, therefore,

no hesitation to conclude that Section 55 and

the schedule adapted only by incorporation

Sections 4(1) and 6(1) and the subsequent

amendments to Section 6 did not become

part of the Act and they have no effect on

the operation of the provisions of the Act."

On the other hand Sahai, J. held that the language of

Section 55 of the U.P. Act indicated that the legislature

intended to take proceedings for acquisition of land under the

Land Acquisition Act except to the extent it has been amended

by the schedule. Notice published in the official gazette under

Section 28 and clause (a) of sub-section (3) of Section 31 have

been given the same effect as a notification issued under

Section 4 of the Land Acquisition Act. Similarly notices issued

under clause (c) of sub-section (3) of Section 23 of the Act or

publication of a notification under sub-section (1) or under sub-

section (4) of Section 32 of the Act have been substituted for

and have the same effect as declaration under Section 6 of the

Land Acquisition Act. In other words the notices issued under

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the Act under different sections mentioned in it shall be

substituted in place of Sections 4 and 6 of the Land Acquisition

Act. The learned Judge concluded that this did not amount to

bringing into effect a new legislation nor transposing provisions

of Land Acquisition Act to the U.P. Act as modified to

proceedings under the U.P. Act. Even so, the learned Judge

observed that though the law was in favour of the petitioners

but equity stood in their way since in pursuance of the

proceedings the Parishad had entered into possession and

constructed housing colonies in the absence of any interim

order. Therefore, the individual interest of the land owners was

faced with public interest of those large number of middle class

persons who must have invested their life's savings in

purchasing these houses and hence the demolition of houses

which are standing over the land and rendering its occupants

homeless shall result in incalculable loss and injury. Larger

social interest, therefore, required this Court to mould the relief

in such manner that justice may not suffer. Since the issuance

of the notifications under Section 4 and Section 6 were not

flawed, and the infirmity arose due to procedural delay, the

principle that delay destroys the remedy but not the right, were

applicable. The Parishad could have acquired the land by

issuing fresh notification. In these circumstances the equity

could be adjusted by directing that the compensation to the land

owners shall be paid by assuming that fresh proceedings for

acquisition were taken in the year in which declaration was

issued. We may observe that in reaching the conclusion that

this was not a case of incorporation of the provisions of the

Land Acquisition Act into the U.P. Act, Sahai, J. relied upon

the decision of this Court in Bhatinda Improvement Trust vs.

Balwant Singh and others (supra). It would thus appear that for

different reasons the learned Judges came to the same

conclusion and accordingly dismissed the appeals and the writ

petitions.

The same question again arose for consideration in U.P.

Avas Evam Vikas Parishad vs. Jainul Islam and another

(supra). In view of the difference of opinion between the

learned Judges in Gauri Shankar Gaur and others vs. State of

U.P. and others (supra) regarding the applicability of the 1984

Act to acquisition for purposes of U.P. Act, the matter was

directed to be heard by a Bench of three Judges. The appellant

Parishad placed reliance on the judgment of Ramaswami, J.

while the respondents strongly placed reliance on the judgment

of Sahai, J. in Gauri Shankar Gaur and others vs. State of

U.P. and others (supra).

This Court in U.P. Avas Evam Vikas Parishad vs.

Jainul Islam and another (supra) noticed the scheme of the

U.P. Act and observed that Section 55 of the U.P. Act makes a

reference to the provisions of the Land Acquisition Act, as

amended, in its application to Uttar Pradesh, and has laid down

that any land or any interest therein required by the Parishad for

any of the purposes of the Ahiniyam may be acquired under the

provisions of the Land Acquisition Act, as amended, in its

application to the State of Uttar Pradesh, which for this purpose

has to be subject to the modifications specified in the schedule

to the U.P. Act. Similar provisions are found in other

enactments and reference was made to the Calcutta

Improvement Act, 1911 whereunder the Board of Trustees of

the Calcutta Improvement Trust was entrusted with very vide

powers for the purpose of carrying out improvement schemes

within the municipal limits of Calcutta. After noticing the

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provisions of the Calcutta Improvement Act, 1911, this Court

noticed the judgment of the Privy Council in Secretary of State

vs. Hindustan Cooperative Insurance Society Ltd. (supra) in

which the question arose - whether the amendment in the Land

Acquisition Act was applicable so as to confer a right of appeal

to the Privy Council against the judgment of the High Court in

an appeal from the Tribunal. The said question was answered

in the negative by the Privy Council. This Court quoted the

following passages appearing in Secretary of State vs.

Hindustan Cooperative Insurance Society Ltd. (supra),

"The modifications are contained

partly in the body of the Act and partly in a

schedule attached to the Act. They are

numerous and substantial and the effect is,

in their Lordship's opinion to enact for the

purposes of the local Act a special law for

the acquisition of land by the trustees within

the limited area over which their powers

extend.

* * * * *

Their Lordships regard the local Act

as doing nothing more than incorporating

certain provisions from an existing Act, and

for convenience of drafting doing so by

reference to that Act, instead of setting out

for itself at length the provisions which it

was desired to adopt."

The Privy Council in the aforesaid judgment also made

the following observations :-

"But their Lordships think that there are

other and perhaps more cogent objections to

this contention of the Secretary of State, and

their Lordships are not prepared to hold that

the sub-section in question, which was not

enacted till 1921, can be regarded as

incorporated in the local Act of 1911. It was

not part of the Land Acquisition Act when

the local Act was passed, nor in adopting the

provisions of the Land Acquisition Act is

there anything to suggest that the Bengal

Legislature intended to bind themselves to

any future additions which might be made to

that Act. It is at least conceivable that new

provisions might have been added to the

Land Acquisition Act which would be

wholly unsuitable to the local code. Nor,

again, does Act 19 of 1921 contain any

provision that the amendments enacted by it

are to be treated as in any way retrospective,

or are to be regarded as affecting any other

enactment than the Land Acquisition Act

itself."

This Court observed that Section 55 read with the

schedule to the U.P. Act are on the same lines as those

contained in the Calcutta Improvement Act, 1911 and,

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therefore, the principles laid down by the Privy Council in that

case were equally applicable to the case in hand. This Court,

therefore, concluded that the provisions of the Land Acquisition

Act, as amended, in its application to U.P. with the

modifications specified in the schedule to the Adhiniyam, have,

therefore, to be treated to have been incorporated by reference

into the Adhiniyam and became an integral part of the

Adhiniyam and the said provisions would remain unaffected by

subsequent repeal or amendment of the Land Acquisition Act

unless any of the exceptional situations indicated in The State of

Madhya Pradesh vs. M.V. Narasimhan (supra) were attracted.

This Court did not agree with the view of Sahai, J. and

approved the view of Ramaswami, J. in Gauri Shankar Gaur

and others vs. State of U.P. and others (supra). This Court

also considered the judgment in The State of Madhya Pradesh

vs. M.V. Narasimhan (supra) which enumerated four

exceptions to the rule that the incorporated provisions of the

previous Act which have become integral and independent part

of the subsequent Act are totally unaffected by any repeal or

amendment in the previous Act. The exceptions enumerated

are :-

"(a) Where the subsequent Act and the

previous Act are supplemental to each

other;

(b) where the two Acts are in pari

materia;

(c) where the amendment in the previous

Act, if not imported into the subsequent Act

also, would render the subsequent Act

wholly unworkable and ineffectual; and

(d) where the amendment of the previous

Act, either expressly or by necessary

intendment, applies the said provisions to

the subsequent Act."

It was held that the U.P. Act and the Land Acquisition

Act could not be regarded as supplemental to each other. The

U.P. Act contains provisions regarding acquisition of land

which are complete and self-contained. Nor can the provisions

in the U.P. Act be said to be in pari materia with the Land

Acquisition Act because the U.P. Act also dealt with matters

which did not fall within the ambit of the Land Acquisition Act.

It could not also be said that the 1984 Act, expressly or by

necessary intendment applied the said amendments to the U.P.

Act. The Court then posed the question "Can it be said that if

the amendments made in the Land Acquisition Act by the 1984

Act are not incorporated in the Adhiniyam, it would be

rendered unworkable ? The Court observed that Sahai, J. had

expressed the view that the exceptional situations referred to in

The State of Madhya Pradesh vs. M.V. Narasimhan (supra)

can be extended further in our constitutional set-up, and that the

courts should lean against the construction which may result in

discrimination.

Relying upon the judgment of this Court in Nagpur

Improvement Trust and another vs. Vithal Rao and others

(supra) it was contended in U.P. Avas Evam Vikas Parishad vs.

Jainul Islam and another (supra) by the land owners that if the

provisions of the Land Acquisition Act as they stood on the

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date of enactment of the U.P. Act without the amendments

introduced by the 1984 Act relating to determination and

payment of compensation, are held to be incorporated in the

U.P. Act, the provisions of the U.P. Act incorporating the

provisions of the Land Acquisition Act would be rendered

unconstitutional as being violative of Article 14 of the

Constitution. On the other hand the Parishad contended that it

was not open to the claimants to raise the question regarding

constitutional validity of the provisions of the U.P. Act under

which the reference had been made. Further it was contended

that the Land Acquisition Act was enacted by Parliament while

the U.P. was enacted by the State Legislature and, therefore,

Article 14 cannot be invoked since the alleged discrimination

arises on the basis of laws made by two different legislative

bodies. In any event, it was contended, that merely because

under the provisions of the Land Acquisition Act, as modified

by the schedule to the U.P. Act, which are applicable in the

matter of acquisition of land for the purposes of the U.P. Act,

solatium is payable @ 15% and not @ 30% and interest is

payable @ 6% and not 9% and 5%, as provided in the Land

Acquisition Act, as amended by the 1984 Act, would not render

the acquisition proceedings taken under the U.P. Act to be

unconstitutional.

This Court after considering the submissions urged

before it held that even if the claimants could not challenge the

validity of the provisions of the law under which the reference

had been made, while construing the provisions of the U.P. Act,

one cannot lose sight of the settled principle of statutory

construction that "if certain provisions of law, construed in one

way, would make them consistent with the Constitution and

another interpretation would render them unconstitutional, the

Court would lean in favour of the former construction". (See

Kedar Nath Singh vs. State of Bihar : AIR 1962 SC 955).

This Court, therefore, proceeded to consider whether the

provisions of the U.P. Act, if they are so construed as to

incorporate the provisions of the Land Acquisition Act as they

stood on the date of enactment of the U.P. Act without the

amendments introduced in the Land Acquisition Act by the

1984 Act relating to determination and payment of

compensation, would be violative of the provisions of Article

14 of the Constitution. The Court noticed the difference in the

compensation that may be payable if the acquisition took place

under the U.P. Act and if the acquisition took place under the

Land Acquisition Act, as amended. The compensation payable

to the owner whose land is acquired for the purposes of the U.P.

Act would be less than the compensation payable to the owner

whose land is acquired under the Land Acquisition Act, as

amended by the 1984 Act. After considering the decision in

Nagpur Improvement Trust and another vs. Vithal Rao and

others (supra) this Court held that the reasons which weighed

with this Court in Nagpur Improvement Trust and another vs.

Vithal Rao and others (supra) in striking down the provisions of

the Nagpur Improvement Trust Act whereby Section 23 of the

earlier Act had been modified in its application for the purposes

of application to the said Act, would equally apply while

construing the constitutional validity of the U.P. Act wherein

the provisions of Section 23 of the Land Acquisition Act have

been modified under the schedule to the U.P. Act. This Court

found that the provisions of the U.P. Act are very similar to

those contained in the Nagpur Improvement Trust Act. Section

55 of the U.P. Act is similar to Section 59 of the Nagpur

Improvement Trust Act inasmuch as both the provisions

provide for modification being made in the Land Acquisition

Act. Section 17-A that has been inserted in the Land

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Acquisition Act by the modification made in the U.P. Act is in

same terms as 17-A which has been inserted by paragraph 6 of

the schedule to the Nagpur Act. Finding such similarity in the

provisions of the two State Acts, this Court held that the

reasons which weighed with this Court in striking down the

provisions of the Nagpur Act would equally apply in the case of

U.P. Act. In this connection this Court relied upon the

following passage from the judgment in Nagpur Improvement

Trust and another vs. Vithal Rao and others (supra) :-

"Article 14 confers an individual right

and in order to justify a classification there

should be something which justifies a

different treatment to this individual right.

It seems to us that ordinarily a classification

based on the public purpose is not

permissible under Article 14 for the purpose

of determining compensation. The position

is different when the owner of the land

himself is the recipient of benefits from an

improvement scheme, and the benefit to him

is taken into consideration in fixing

compensation. Can classification be made

on the basis of the authority acquiring the

land? In other words can different

principles of compensation be laid if the

land is acquired for or by an Improvement

Trust or Municipal Corporation or the

Government? It seems to us that the answer

is in the negative because as far as the owner

is concerned it does not matter to him

whether the land is acquired by one

authority or the other.

* * *

It is equally immaterial whether it is

one Acquisition Act or another Acquisition

Act under which the land is acquired. If the

existence of two Acts enables the State to

give one owner different treatment from

another equally situated the owner who is

discriminated against, can claim the

protection of article 14."

This Court also considered the judgment in Prakash

Amichand Shah vs. State of Gujarat and others (supra) and

distinguished the same finding that the provisions of Section 53

of the Bombay Town Planning Act, 1954 were not akin to the

acquisition proceedings under the Land Acquisition Act, and

the provisions of the Land Acquisition Act were not applicable,

with or without modifications, as in the case of Nagpur

Improvement Trust Act. Section 53 of the Bombay Town

Planning Act was comparable with the provisions contained in

Sections 38 and 39 of the U.P. Act which provided for vesting

of certain public lands vested in the local authority or private

street or square and payment of compensation for such lands.

The case of Prakash Amichand Shah vs. State of Gujarat and

others (supra) was, therefore, distinguished.

Having considered all aspects of the matter, this Court

recorded its conclusion in the following words :-

"31. Since the present case involves

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acquisition of land under the provisions of

the LA Act as applicable under the

Adhiniyam, it is fully covered by the law

laid down by this court in Nagpur

Improvement Trust. Keeping in view the

principles laid down in the said decision of

this Court, it has to be held that if the

provisions of the Adhiniyam are so

construed as to mean that the provisions of

the LA Act, as they stood on the date of

enactment of the Adhiniyam, would be

applicable to acquisition of land for the

purpose of the Adhiniyam and that the

amendments introduced in the LA Act by

the 1984 Act relating to determination and

payment of compensation are not applicable,

the consequence would be that the

provisions of the LA Act, as applicable

under the Adhiniyam, would suffer from the

vice of arbitrary and hostile discrimination.

Such a consequence would be avoided if the

provisions of the Adhiniyam are construed

to mean that the provisions of the LA Act, as

amended by the 1984 Act, relating to

determination and payment of compensation

would apply to acquisition of land for the

purposes of the Adhiniyam. There is

nothing in the Adhiniyam which precludes

adopting the latter construction. On the

other hand, the provisions of the Adhiniyam

show that the intention of the legislature,

while enacting the Adhiniyam, was to confer

the benefit of solatium @ 15% by modifying

Section 23 (2) in the Schedule, which

benefit was not available under the

provisions of the LA Act as it was

applicable in the State of Uttar Pradesh at

the time of enactment of the Adhiniyam. It

cannot, therefore, be said that the intention

of the legislature, in enacting the

Adhiniyam, was to deny to the landowners

the benefits relating to determination and

payment of compensation which would be

available to them under any amendment

made in the LA Act after the enactment of

the Adhiniyam. We are, therefore, of the

opinion that on a proper construction of

Section 55 of the Adhiniyam it must be held

that while incorporating the provisions of

the LA Act in the Adhiniyam the intention

of the legislature was that amendments in

the LA Act relating to determination and

payment of compensation would be

applicable to acquisition of lands for the

purposes of the Adhiniyam. This means that

the amendments introduced in the LA Act

by the 1984 Act relating to determination

and payment of compensation, viz., Section

23(1-A) and Section 23(2) and 28 as

amended by the 1984 Act would be

applicable to acquisitions for the purposes of

the Adhiniyam under section 55 of the

Adhiniyam."

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So far as the U.P. Act is concerned the judgment in U.P.

Avas Evam Vikas Parishad vs. Jainul Islam and another

(supra) answers all the questions raised before us. It has been

held that so far as the U.P. Act is concerned, the Land

Acquisition Act, as modified, stands incorporated in the U.P.

Act. However, as a matter of construction it was held that

Section 55 of the U.P. Act, while incorporating the provisions

of the Land Acquisition Act intended to apply to acquisition

made under the U.P. Act the beneficial amendments that may

be brought about for determination and payment of

compensation, in the Land Acquisition Act, 1894. There was

nothing in the U.P. Act which precluded the Court from

adopting such a construction, and this was necessary to save the

Act from the vice of arbitrary and hostile discrimination.

This Court also found that the provisions of the Nagpur

Act, with which we are concerned, were similar to the

provisions of the U.P. Act. This aspect of the matter has been

discussed in paragraph 27 of the report. We have also

considered the provisions of the Nagpur Act as well as the

provisions of the Punjab Act. We are satisfied that the

aforesaid two Acts as well as the U.P. Act have a common

scheme and pattern. All the three legislations relate to town

planning and development, and each one of them specifies the

various schemes that may be undertaken. For acquisition of

land for the purposes of any of the schemes under the said Acts,

the Land Acquisition Act 1894 has been made applicable with

certain modifications as contained in the schedule to the said

Acts which are numerous and substantial. The modifications

made are also similar. We have found no distinction in the

three Acts which may have a bearing on the question relating to

legislative incorporation of the Land Acquisition Act in the

State Acts. We are, therefore, of the view that what has been

held by this Court in U.P. Avas Evam Vikas Parishad vs.

Jainul Islam and another (supra) with regard to U.P. Act holds

good for the Punjab Act as well as the Nagpur Act.

Consequently we are unable to subscribe to the view taken in

Bhatinda Improvement Trust vs. Balwant Singh and others

(supra) that the provisions of the Land Acquisition Act have not

been incorporated into the Punjab Act and that they have

merely been cited or referred to in the Punjab Act.

It may be noticed that in U.P. Avas Evam Vikas Parishad

vs. Jainul Islam and another (supra) this Court highlighted the

fact that though under the Land Acquisition Act as amended in

its application to the State of U.P. there was no provision for

grant of solatium, by the U.P. Act such solatium was provided

for. The intention of the legislature was apparent that it wanted

to confer the benefit of solatium by modifying Section 23(2),

which benefit was not available under the provisions of the

Land Acquisition Act as it was applicable in the State of U.P. at

the time of enactment of the U.P. Act. So far as the Punjab Act

and the Nagpur Act are concerned, the schedules do not modify

the provisions of Section 23(2) of the Land Acquisition Act

which provides for payment of solatium. However, a proviso

was added to the effect that sub-section (2) shall not apply to

any land acquired under the State Acts in question. The added

proviso is identical in both the State Acts. This clearly implies

that where acquisition was made under the provisions of the

Land Acquisition Act, as modified, the legislature did not

intend to deprive the claimants of solatium as provided under

the Land Acquisition Act. But solatium was not payable in

cases of acquisition under the State Acts. There are provisions

in both the State Acts which permit the State to acquire lands

for the purposes of the schemes without resorting to the

provisions of the Land Acquisition Act such as acquisition by

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purchase, lease, exchange, or otherwise, or acquisitions

contemplated under deferred street scheme, development

scheme and expansion scheme. In respect of such acquisitions

solatium is not payable. Such cases are similar to the

acquisitions under Section 53 of the Bombay Town Planning

Act which was considered by this Court in Prakash Amichand

Shah vs. State of Gujarat and others (supra). In these

circumstances with a view to save the law from the vice of

arbitrary and hostile discrimination, the provisions must be

construed to mean, in the absence of anything to the contrary,

that the provisions of the Land Acquisition Act as amended by

the 1984 Act relating to determination and payment of

compensation would apply to acquisition of land for the

purposes of the State Acts. It must, therefore, be held that

while incorporating the provisions of the Land Acquisition Act

in the State Acts, the intention of the legislature was that

amendments in the Land Acquisition Act relating to

determination and payment of compensation would be

applicable to acquisition of lands for the purposes of the State

Acts. Consequently the claimants are entitled to the benefits

conferred by Section 23(1-A), if applicable, and Section 23(2)

and 28 of the Land Acquisition Act as amended by the 1984

Act for acquisition of land for the purposes of the State Acts

under Sections 59 of both the Nagpur and the Punjab Acts.

We shall now proceed to consider the other submissions

urged before us.

In so far as the Punjab cases are concerned, the challenge

is to the grant of benefit to the claimants under the amended

provisions of Sections 23 and 28 of the Land Acquisition Act.

In all these cases acquisitions were made under the provisions

of the Land Acquisition Act as modified by the State Act and

the Collector had made his Awards which were challenged.

Mr. Rajinder Sachar appearing on behalf of Jalandhar

Improvement Trust submitted that the scheme of the Act

discloses that the acquiring authority was the Trust and not the

State. He sought to distinguish the case of Nagpur

Improvement Trust contending that in that case it was the State

which was the acquiring authority and the State could not

discriminate between one land-holder and the other whose lands

were sought to be acquired by choosing to acquire land under

one or the other Act so as to discriminate between such land

holders. The submission overlooks Section 17-A of the Land

Acquisition Act which is inserted in all the thee State Acts by

way of modification. In Om Prakash and another vs. State of

U.P. and others : (1974) 1 SCC 628 this Court considered a

similar provision in the U.P. Nagar Mahapalika Adhiniyam,

1959 and held that Section 17-A which was inserted in that Act

and which was in the same terms, showed that the land has first

to be acquired by the Collector for the Government and

thereafter it is transferred by the Government to the Mahapalika

only on payment of its costs. Thus, it was clear beyond all

manner of doubt that whenever land is to be compulsorily

acquired for the Mahapalika the acquiring authority is the

Government. It was observed that there was no material

difference between the impugned provisions of the Adhiniyam

and those which were in question before this Court in Nagpur

Improvement Trust's case (supra). Since Section 17-A inserted

in the Land Acquisition Act by way of modification in all the

three State Acts is in the same terms as Section 17-A

considered by this Court in the aforesaid decision, it must be

held that the acquiring authority under the State Acts is the

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Government and not the Trust.

In any event in Nagpur Improvement Trust (supra) this

Court negatived the contention that different principles of

compensation can be laid if the land is acquired for or by the

Improvement Trust or Municipal Corporation or the

Government. This Court held that as far as the owner is

concerned, it does not matter to him whether the land is

acquired by one authority or the other. Thus, viewed from any

angle, the submission must be rejected.

Learned counsel then relied upon the two decisions of

this Court in Maneklal Chhotalal and others vs. M.G.

Makwana and others (supra) and State of Gujarat vs.

Shantilal Mangaldas and others (supra), and submitted that the

law as laid down in those decisions must apply to the cases in

hand. Both these decisions were considered in a later decision

of this Court in Prakash Amichand Shah vs. State of Gujarat

and others (supra) and followed. In Jainul Islam's case (supra)

this Court considered the decision in Prakash Amichand Shah

vs. State of Gujarat and others (supra) and distinguished it. It

must, therefore, be held that the aforesaid two decisions on

which Mr. Sachar relies do not advance the case of the Trust.

Those cases are clearly distinguishable. Mr. Sachar then

contended that even if the claimants cannot be deprived of the

enhanced solatium under Section 23(2) of the Land Acquisition

Act, in the facts of this case the owners are not entitled to the

benefit of additional compensation payable under Section

23(1-A) of the Land Acquisition Act which has been brought in

by way of amendment in the year 1984.

We find considerable force in this submission. It may be

noticed that at the time when the High Court decided the Letters

Patent Appeals pending before it, the law as laid down by this

Court in Union of India and another etc. etc. vs. Zora Singh

and others etc. etc : (1992) 1 SCC 673 held the field.

However, a larger bench of 5 judges reconsidered the matter in

K.S. Paripoornan vs. State of Kerala and others : 1994(5)

SCC 593 and overruled the decision in Zora Singh's case. This

Court held :-

"80. For the reasons aforementioned it

must be concluded that in respect of

acquisition proceedings initiated prior to

date of commencement of the amending Act

the payment of the additional amount

payable under Section 23(1-A) of the Act

will be restricted to matters referred to in

clauses (a) and (b) of sub-section (1) of

Section 30 of the amending Act. Zora Singh

insofar as it holds that the said amount is

payable in all cases where the reference was

pending before the reference Court on 24-9-

1984, irrespective of the date on which the

award was made by the Collector, does not

lay down the correct law."

In the appeals and special leave petitions before us

relating to acquisitions under the Punjab Act, the High Court

has granted to the claimants the benefit of additional amount

payable under Section 23(1-A) of the Land Acquisition Act.

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We find from the record placed before us that the Awards of the

Collector in all these cases were made much before 30th April,

1982 and, therefore, there was no proceeding for acquisition of

land pending on 30th April, 1982 since the Collector had made

his Awards much earlier. Such being the factual position, the

claimants will not be entitled to the benefit of additional

amount payable under Section 23(1-A) of the Land Acquisition

Act and the judgments and orders of the High Court on this

aspect of the matter must be set aside.

In C.A. Nos.9260-9261 of 1995 the appellant has claimed

benefit of additional amount payable under Section 23(1-A) of

the Land Acquisition Act. In these cases as well the Collector

had made his Award much before 30th April, 1982 and,

therefore, the appellant's claim for additional amount under

Section 23(1-A) must be rejected.

So far as the acquisition under the Nagpur Act and the

U.P. Act are concerned they have been challenged on the

ground that the Notification corresponding to the declaration

under Section 6 of the Land Acquisition Act was made more

than 3 years after the expiry of the date of the publication of the

Notification corresponding to the Notification under Section 4

of the Land Acquisition Act. This was on the assumption that

the provisions of the Land Acquisition Act were not

incorporated in the State Acts but were merely referred to and

the amendment of Section 6 of the Land Acquisition by

insertion of proviso thereto by Act 13 of 1967, would apply to

the acquisitions. We have already held that the provisions of

the Land Acquisition Act as modified by the State Acts and the

Schedule thereto stand incorporated in the State Acts and,

therefore, the subsequent amendments of Section 6 by the Land

Acquisition (Amendment and Validation) Act, 1967 (Act No.

13 of 1967) or by Act 68 of 1984, will have no effect on the

acquisition made under the State Acts. The High Court of

Allahabad has taken this view while the High Court of Bombay,

Nagpur Bench, Nagpur has taken the contrary view. The

appeals, therefore, which are directed against the judgment of

the High Court of Allahabad must be dismissed and those

against the judgment of the High Court of Bombay, Nagpur

Bench, Nagpur, must be allowed. Since we have held that the

Land Acquisition Act stands incorporated in the State Acts,

with the consequence that subsequent amendments to the Land

Acquisition Act have no effect upon the acquisitions made

under the State Acts, it is not necessary to consider the

submission of Mr. Rakesh Dwivedi, Senior Advocate, that in

view of the judgment of this Court in T.M. Peter's case (supra),

the absence of any time limit in the State Acts for issuance of

Notification corresponding to the declaration under 6 of the

Land Acquisition Act will not expose the State Acts to the

charge of discrimination invoking the principles enshrined in

Article 14 of the Constitution.

In the result C.A. Nos. 9206 to 9214 of 1995 are partly

allowed and the direction contained in the judgments and orders

impugned to the effect that the claimants shall be entitled to the

benefit of additional compensation under Section 23(1-A) of

the Land Acquisition Act is set aside. However, the impugned

judgments and orders are affirmed in all other respects.

Special Leave Petition (Civil) No. 3210 of 1999 is

dismissed.

Civil Appeal Nos. 9260-9261 of 1995 in which the

appellants have claimed additional compensation under Section

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23(1-A) of the Land Acquisition Act are dismissed since in all

these cases the Collector pronounced his Award much prior to

30th April, 1982.

Civil Appeal Nos. 3789 of 1992 and 839 of 1995 and

Special Leave Petition (Civil) Nos. 12949 of 1992 and 3331 of

1993 are dismissed.

Civil Appeal Nos. 6590 to 6592 of 2001 were partly

allowed by this Court by order dated September 19, 2001 in so

far as the claim for interest on the enhanced solatium under

Section 23(2) of the Land Acquisition Act is concerned. Their

claim to interest on the sum payable under sub-section (1-A) of

Section 23 of the Land Acquisition Act must also be allowed in

view of the judgment of this Court in Sunder vs. Union of

India (supra). Accordingly these appeals are allowed and it is

held that the claimants are also entitled to interest on the

amount payable to them under sub-section (1-A) of Section 23

of the Land Acquisition Act. The respondents are directed to

compute and pay the interest payable to the appellants in

accordance with law as enunciated in Sunder vs. Union of

India (supra).

Civil Appeal Nos. 1164-1200 of 1993 and SLP (C)

Nos. 8256-8259 of 1993 are allowed and the impugned

judgments and orders of the High Court in all the appeals are

set aside. The appellants shall now proceed with the acquisition

in accordance with law.

There shall be no order as to costs.