ivil Appeal Nos
2085 of 1978 and 7 8 of 1979
Appeals by special leave from the Judgment and Order dated 1851977 of the Allahabad High Court in CMW Nos
506173 506373 and 508073
GC Lal DB Vohra and OP Tewari for the Appellants in all the Appeals
Probir Mitra for R1 in CAs
208578 879 and RR 1 2 in CA 779
GN Dixit and Sobha Dikshit for RR
2 to 4 in CA 208578 RR 2 4 in CA 879 and RR 35 in CA 779
EC Aggarwala for R4 in CA 779 and R 3 in CA 879
The Judgment of the Court was delivered by BAHARUL ISLAM J
The above appeals arise out of land acquisition proceedings and involve similar questions of fact and the same 48 question of law
This common judgment therefore will dispose of all the three appeals
It will be sufficient if we refer to the material facts of Civil Appeal No 2085 of 1978 only 2
The land involved belonged to one Imam Khan as an occupancy tenant
Before the partition of India he migrated to Pakistan whereafter his rights in the lands were declared evacuee property
Subsequently in pursuance of a notification issued under Section 12 of the  the Central Government acquired the lessee rights
As a result of the notification these rights vested in the Central Government free from all encumbrances
The Central Government thereafter sold these rights by auctions in AugustSeptember 1962
The first Respondent purchased a plot of land for a sum of Rs 21700
He deposited the entire amount with the Managing Officer Evacuee Property Agra
A sale certificate was issued to him on September 12 1962
It appears that one Ramlal Lamba was in the possessi on of the land in question
He was asked by the Managing Officer Evacuee Property to vacate the land and deliver possession to the first respondent
Instead of delivering possession of the land to the first respondent Lamba filed a Writ Petition under Article 226 of the Constitution in the Punjab High Court at Delhi
The Writ Petition was dismissed on 41269
He then filed an appeal which was also dismissed on 2270
He then filed a suit in the Court of the Munsiff Agra for restraining the Managing Officer Evacuee Property from interfering in his possession
Thus the first respondent could not get possession of the land
After the auction sale the State of U P Respondent No 2 herein filed a suit under Section 171 of U P Tenancy Act 1939 hereinafter the Tenancy Act  against the Custodian of the Evacuee Property and the four auction purchasers including the first respondent for possession
This suit was dismissed by the Assistant Collector Ist Class on 24369 on the ground that it was not maintainable
An appeal was filed
This was also dismissed on 241070
Thus before the petitioner could obtain possession of the land the Collector of Agra Respondent No3 herein issued a notification under Section 4 of the Land Acquisition Act hereinafter the Act  on March 1 1970 notifying that the plots in dispute and several other plots were intended to be acquired by the State Government for construction of residential houses for the members of the General Servants Co operative Housing Society Ltd Agra the appellant 49 before us
The first respondent did not have any knowledge or information of the said notification under Section 4 of the Act and so he did not as he could not file any objection under section 5A of the Act
The notification under section 4 was followed by a notification under section 6 of the Act on May 4 1973
After the said notifications proceedings relating to determination of compensation for the lands were started
In that connection the first Respondent was served with a notice under section 93 of the Act calling upon him to prefer his claim for compensation
Thereupon the first Respondent filed objections but before the objections were disposed of he filed a writ petition before the High Court of Allahabad
The High Court allowed the writ petition and struck down the notification dated 5th May 1973 under Section 6 of the Act
The High Court held that as the acquisition was made by the State Government for the benefit of a Co operative Society it could do so only after complying with the provisions of Chapter VII of the Act and the Land Acquisition Companies Rules 1963 hereinafter called the rules  but as the State Government did not do so there was a breach of the principle of natural justice
Repelling the argument of the appellant to the contrary the High Court also held that the first respondent was a person interested  within the meaning of section 3 b of the Act
Respondents No 2 3 and 4 who are co respondents appearing through Mr Dikshit before us have supported the case of the appellant
The first question for determination is whether the first respondent is not a person interested  within the meaning of section 3b of the LA Act and as such he had no locus standi to file the writ petition before the High Court as contended by the appellant
Section 3 b of the Act is in the following terms material portions only 3
In this Act unless there is something repugnant in the subject or context a   b the expression person interested includes all persons claiming an interest in compensation to be made on account of the acquisition of land under this Act and a person shall be deemed to be interested in land if he is interested in an easement affecting the land 50 In support of the argument the appellant refers to section 45 f and section 180 of the Tenancy Act 1939
Clause f of section 45 provides that the interest of the tenant shall be extinguished where the tenant has been deprived of possession and his right to recover possession is barred by limitation
The limitation provided is for a period of twelve years for a suit for ejectment of a person occupying the land without title and for damages if the land is contiguous to any other land lawfully occupied by such other person a if such person has at the commencement of the Tenancy Act occupied the land for more than six years the period runs from the time the land holders first knew of the unauthorised occupation
In any other case the period of limitation is six years
This point which has been urged for the first time before us is a mixed question of fact and law
It does not appear to have been taken before the High Court
A mixed question of law and fact needing investigation into facts cannot be allowed to be urged for the first time in an appeal by special leave under article 136 of the Constitution
It is true that admittedly the first respondent was out of possession at the relevant time but there is no evidence before us to show whether or not the land in question was contiguous to any other land occupied by the person who is in possession and that his possession had been lawful
We are therefore not in a position to accept the submission of the appellant that the first respondent s claim was barred by limitation
On the contrary there is ample evidence before us to show that the first respondent had interest in the land in question
We come to this conclusion from the following circumstances I A sale certificate had been issued to the first respondent after the purchase of the land in auction sale held in 1962 2 the Collector Agra knew that the first respondent had purchased the land in auction for he had himself filed a suit for ejectment from the land in question under section 171 of the Tenancy Act against the first respondent and that the suit was dismissed by the Assistant Collector Ist Class on 24th March 1969 the appeal preferred against the said order had also been dismissed by the Commissioner on the 27th of October 1970 3 the Collector issued notice under section 9 3 of the Act calling upon the first respondent to prefer his claim if any for compensation of the land acquired
This amounts to an admission of the first respondent s interest in the land by the Collector and 4 that in the counter affidavit filed by the Collector in reply to the affidavit filed by the first respondent before the High Court 51 the claim of the petitioner to get compensation for the rights acquired by the Government was not denied by the appellant
We therefore agree with the High Court that the first respondent was a person interested  within the meaning of clause b of section 3 of the Act
The next point urged before us by the appellants is that the first respondent in fact filed objection which was inquired into and he was given an opportunity of being heard
The High Court therefore it is contended was not right in holding that there was a breach of the principle of natural justice
In our opinion the real question as urged by the first respondent is not whether there has been any violation of any principle of natural justice but whether Rule 4 of the Rules has been complied with by the Collector
Sub section 1 of Section 4 of the Act provides that whenever it appears to the appropriate Government that land in any locality is needed or is likely to be needed for any public purpose a notification to that effect shall be published in the official gazette and that he shall also cause a public notice of the substance of the notification to be given at convenient places in the said locality
Section 5A of the Act provides that any person interested in any land which has been notified under sub section 1 of section 4 as being needed or likely to be needed for a public purpose or for a Company may within thirty days twenty one days according to the UP amendment after the issue of the notification object to the acquisition of the land or of any land in the locality as the case may be
Under section 3 e the expression Company  inter alia includes a society registered under the and a registered society within the meaning of the or any other law relating to co operative society for the time being in force in any State
The appellant The General Govt
Servants Co operative Housing Society Ltd Agra is a Company
The appellant has not contended to the contrary
It is also not disputed that when land is acquired for the purpose of a company of the Act is attracted and the provisions of that chapter have to be followed
Rule 4 of the Rules which is material and falls for our interpretation runs thus 4
Appropriate Government to be satisfied with regard to certain matters before initiating acquisition proceedings 1 Whenever a Company makes an application to the appro 52 priate Government for acquisition of any land that Government shall direct the Collector to submit a report to it on the following matters namely i that the Company has made its best endeavour to find out lands in the locality suitable for the purpose of the acquisition ii that the Company has made all reasonable efforts to get such lands by negotiation with the persons interested therein on payment of reasonable price and such efforts have failed iii that the land proposed to be acquired is suitable for the purpose iv that the area of land proposed to be acquired is not excessive v that the Company is in a position to utilise land expeditiously and vi where the land proposed to be acquired is good agricultural land that no alternative suitable site can be found so as to avoid acquisition of that land
2 The Collector shall after giving the Company a reasonable opportunity to make any representation in this behalf hold an enquiry into the matters referred to in sub rule 1 and while holding such enquiry he shall i in any case where the land proposed to be acquired is agricultural land consult the Senior Agricultural Officer of the district whether or not such land is good agricultural land  ii determine having regard to the provisions of sections 23 and 24 of the Act the approximate amount of compensation likely to be payable in respect of the land which in the opinion of the Collector should be acquired for the Company  and iii ascertain whether the Company offered a reasonable price not being less than the compensation so determined to the persons interested in the land proposed to be acquired
Explanation  For the purpose of this rule good agricultural land means any land which considering the level of agricultural production and the crop pattern of the area in which 53 it is situated is of average or above average productivity and includes a garden or grove land
3 As soon as may be after holding the enquiry under sub rule 2 the Collector shall submit a report to the appropriate Government and a copy of the same shall be forwarded by that Government to the Committee
4 No declaration shall be made by the appropriate Government under section 6 of the Act unless i the appropriate Government has consulted the Committee and has considered the report submitted under this rule and the report if any submitted under section 5A of the Act and ii the agreement under section 41 of the Act has been executed by the Company  Sub rule 1 requires the Government to direct the Collector to submit a report to it on the matters enumerated in clauses i to vi of the sub rule 1 which is for the benefit of the Company
The purpose is to avoid acquisition of land not suitable for a Company
Clause ii of sub rule 1 requires that the Company has to make all reasonable efforts to get such lands by negotiation with the person interested therein on payment of reasonable prices and that such efforts have failed
The purpose of clause ii seems to be to avoid unnecessary land acquisition proceedings and payment of exorbitant prices
The purpose of clauses iii iv and v is obvious
The purpose of clause vi is to avoid acquisition of good agricultural land when other alternative land is available for the purpose
Subrule 2 of rule 4 requires the Collector to give reasonable opportunity to the Company so that the Collector may hold an inquiry into the matters referred in sub rule 1
The Collector has to comply with Clauses i ii and iii of sub rule 2 during the course of the inquiry under sub rule 1
The Collector under sub rule 3 then has to send a copy of his report of the inquiry to the appropriate Government and a copy of the report has to be forwarded by the Government to the Land Acquisition Committee constituted under Rule 3 for the purpose of advising the Government in relation to acquisition of land under Part VII of the Act the duty of the Committee being to advise the Government on all matters relating to or arising out of acquisition of land under Part VII of the Act Sub rule 5 of Rule 3
No declaration shall be made by the 54 appropriate Government under section 6 of the Act unless the Committee has been consulted by the Government and has considered the report submitted by the Collector under section 5A of the Act
In addition under clause ii of sub rule 4 of rule 4 the Company has to execute an agreement under section 41 of the Act
The above consideration shows that rule 4 is mandatory its compliance is no idle formality unless the directions enjoined by rule 4 are complied with the notification under section 6 will be invalid
A consideration of rule 4 also shows that its compliance precedes the notification under section 4 as well as compliance of section 6 of the Act
In the instant case as stated earlier the first respondent on receipt of the notice under section 93 of the Act submitted a representation
After the representation a brief written note of the arguments was also supplied Annexure 6
The first respondent s objections inter alia against the acquisition of the land were 1 that the land being that of the Government cannot be legally acquired  2 that the land or lessee rights having been once acquired by the Central Government under the provisions of the  it cannot be acquired by the State Government  and 3 that the proceedings for the acquisition of the land for the appellant were illegal as the mandatory procedure for acquisition of land for private companies has not been followed
It was also stated in the representation that no efforts to purchase the rights of the first respondent by negotiation were made
The inquiry report submitted by Collector does not show that he applied his mind to the provisions of rule 4 as stated above or to the objections of the first respondent
In fact there was no report under rule 4
The report that was submitted was one under section 5A of the Act
We have examined this aspect of the matter to see that although the enquiry was belated and not in accordance with law there has been no failure of justice
In our opinion there has been failure of justice
Agreeing with the finding of the High Court although for different reasons we hold that the notification under section 6 is invalid for non compliance of rule 4 of the Rules
As a result we dismiss the appeals with costs
PBR Appeals dismissed


Summary:
The land in dispute originally belonged to a person who had migrated to Pakistan
After acquiring the lessee rights in the land under section 12 of the the Central Government sold these rights by auction
The first respondent purchased a plot of land and a sale certificate was issued to him
The respondent however could not get possession of the land as a result of litigation resorted to by the person in possession of the land
In the meantime the State Government filed a suit against the Custodian of Evacuee Property and the auction purchasers for possession but the suit and later appeal were dismissed
Before the respondent obtained possession of the land a notification under section 4 of the Land Acquisition Act was issued seeking to acquire the land for construction of residential houses for the members of the appellant society
Having had no knowledge of the notification the respondent did not file any objection under section 5A After the issue of notification under section 6 of the Act proceedings relating to determination of compensation for the lands were started
A notice was served on the respondent under section 93 of the Act calling upon him to prefer his claim for compensation
Allowing the respondent s petition impugning the action of the Government the High Court held that the State Government could acquire the land only after complying with the provisions of Chapter VII of the Act and the Land Acquisition Companies Rules 1963 and this not having been done there was a breach of the principle of natural justice and that secondly the respondent was a person interested within the meaning of section 3b of the Act
On the question whether the respondent was a person interested  and whether the notification issued under section 6 was valid
 HELD The expression person interested is defined in section 3b as including all persons claiming an interest in compensation to be made on account of acquisition of land under the Act
That the first respondent had interest in the land in question is warranted by the following circumstances i a sale certificate had been issued to him after he purchased the land in auction sale ii the Collector knew that he had purchased the land for he had himself filed a suit for ejectment against him from the land and that the suit was dismissed and the appeal against that order was also dismissed iii the Collector called upon the respondent to prefer his claim under section 93 of the Act which showed that 47 the Collector had admitted the first respondent s interest in the land and iv before the High Court the Collector had not denied the respondent s right to compensation
Therefore the first respondent was a person interested within the meaning of section 3b
50 F H 2
The notification under section 6 is invalid for non compliance with rule 4 of the Rules
54 G The appellant society is a company within the meaning of section 3e of the Act
When the land was acquired for the purpose of a company Part VII of the Act is attracted and the provisions of that Chapter have to be followed
Rule 4 is mandatory and unless the directions enjoined by this rule are complied with the notification under section 6 would be invalid
Its compliance precedes the notification under section 4 as well as compliance of section 6 of the Act
51 F G In the instant case on receipt of the notice under section 93 the respondent objected to the acquisition on the grounds that the land or lessee rights having been acquired by the Central Government under the provisions of the could not be acquired by the State Government and that the mandatory procedure for acquisition of land for private companies had not been followed
No inquiry report had been submitted by the Collector
The report submitted was under section 5A and not under rule 4
There had therefore been a failure of justice
54 C F 3
The appellant s contention that the first respondent s claim was barred by limitation under sections 45f and 180 of the Tenancy Act has no force because there is no evidence to show that the requirements of the section have been satisfied
That apart this is a mixed question of fact and law requiring investigation into facts
Since it had not been taken before the High Court but sought to be urged for the first time in this Court it cannot be allowed to be urged in an appeal by special leave under Article 136 of the Constitution
50 C D