SCA/521/2003 1/73 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No.521 of 2003 For Approval and Signature: HONOURABLE MR.JUSTICE J.M.PANCHAL AND HONOURABLE MR.JUSTICE H.B.ANTANI ============================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment? 2 To be referred to the Reporter or not? 3 Whether their Lordships wish to see the fair copy of the judgment? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder? 5 Whether it is to be circulated to the Civil Judge? ============================================================== JORUBHA RAGHAJI & ORS. - Petitioners Versus STATE OF GUJARAT & ORS. - Respondents ============================================================== Appearance : MR BP MUNSHI for Petitioners. MR SN SHELAT, ADVOCATE GENERAL for Respondent Nos.1, 2, 3. MR KS NANAVATI FOR NANAVATI ASSOCIATES for Respondent No.4. ===================================================================== CORAM : HONOURABLE MR.JUSTICE J.M.PANCHAL and HONOURABLE MR.JUSTICE H.B.ANTANI Date : 23/08/2005 ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE J.M.PANCHAL) By filing instant petition under Article 226 of the Constitution, the petitioners, who are heirs and legal representatives of deceased Raghaji Balubha, have SCA/521/2003 2/73 JUDGMENT prayed to issue writ of mandamus or writ or order in the nature of mandamus or any other appropriate writ, order or direction to quash notification dated May 14, 2001 issued under Section 4 of the Land Acquisition Act, 1894 (“the Act” for short) as well as declaration dated April 9, 2002 made under Section 6 of the Act, for acquiring lands bearing Survey Nos.572, 573 and 574 belonging to them and situate at Village Moti Khavdi, Taluka & District: Jamnagar. The petitioners have further prayed to declare that acquisition proceedings for acquiring abovereferredto lands for the purpose of respondent No.4-company, are unconstitutional, illegal, against the mandatory Rules and bad in law. 2. Deceased Raghaji Balubha, a resident of Village Gagva, Taluka & District:Jamnagar, was owner of three pieces of agricultural lands, i.e. (1) Survey No.572 admeasuring 3 Hectare 73 RA 32 Mtrs.; (2) Survey No.573 admeasuring 3 Hectare 98 RA 62 Mtrs.; and (3) Survey No.574 admeasuring 6 Hectare 12 RA 9 Mtrs., situate at Village Moti Khavdi, District : Jamnagar. The respondent No.4, i.e. Reliance Petroleum Limited, is a Public Limited Company. It has set up a mega petroleum refinery at Jamnagar. Its initial production capacity was 9 SCA/521/2003 3/73 JUDGMENT million metric tons per annum. For the purpose of constructing a housing colony for the employees of refinery, initially lands were acquired and the housing colony was built thereon with necessary amenities like hospital, school, bank, markets, gardens, sport and recreational facilities, etc. Subsequently, its production capacity was increased to 27 million metric tons per annum. Therefore, additional workmen and employees were recruited. The existing housing colony was not found sufficient to accommodate all the employees of the company. The respondent No.4 company needed more lands. Therefore, efforts were made to obtain lands by private negotiations. The company addressed letters dated December 11, 2000 and invited the landowners for private negotiations. Those letters were dispatched under Certificate of Posting. Pursuant to service of letters to the landowners, Chhaganbhai Jethalal, who is grandson of Bhanaji Kanabhai, remained present for negotiations. He demanded compensation at the rate of Rs.2 Lacs per Vigha. The company in order to determine the market value of the lands to be acquired took into consideration the sale deeds relating to the lands situated in the area and offered Rs.20,500=00 per Vigha for non-irrigated lands and Rs.38,000=00 per Vigha for irrigated lands. SCA/521/2003 4/73 JUDGMENT Chhaganbhai did not accept the offer made by the respondent No.4-company. Thus, negotiations failed. The company, therefore, addressed letters dated December 27, 2000 to the Collector, Jamnagar, and the Deputy Secretary, Revenue Department, to acquire the lands to enable it to erect dwelling houses for its workmen and to provide necessary amenities to them. The Government vide letter dated January 24, 2001 directed concerned officer to enquire and furnish his report under Section 40 of the Act read with Rule 4 of the Land Acquisition (Companies) Rules, 1963 (“the Rules” for short). Pursuant to the directions of the Collector, Jamnagar, the Deputy Collector, Jamnagar, initiated inquiry under Rule 4 of the Rules. He, by letters dated February 28, 2001 addressed to the owners of the lands, asked them to remain present in his office for personal meeting on March 12, 2001. Deceased Raghaji Balubha did not remain present. The Deputy Collector also consulted District Agricultural Officer, who submitted his report dated April 3, 2001. The Deputy Collector, after hearing other landowners who remained present, submitted his report to the Collector on April 12, 2001. The Collector submitted his report to the Government on May 8, 2001. The Government issued notification under Section 4 of the Act SCA/521/2003 5/73 JUDGMENT on May 14, 2001 mentioning that the lands mentioned therein including the lands of the petitioners were likely to be needed for the purpose of the respondent No.4-company. The notification issued under Section 4 of the Act was published in “Sandesh” and “Indian Express” dailies on July 2, 2001. The Deputy Collector published notice dated June 16, 2001 under Section 4(1) of the Act inviting objections to be filed on or before July 17, 2001 and calling upon the interested persons to remain present in his office on July 23, 2001 for personal hearing. The petitioners filed their objections on July 10, 2001 through their advocate. After making inquiry, the Land Acquisition Officer forwarded his report under Section 5A(2) of the Act to the Government. The Government after considering report submitted to it, issued declaration under Section 6 of the Act on April 9, 2002. Notices under Section 9 of the Act were issued on August 26, 2002. Notification under Section 4 of the Act and declaration made under Section 6 of the Act are subject matters of challenge in instant petition. 3. The petitioners have averred that earlier respondent No.4 had acquired lands admeasuring 126 Hectare 26 RA 7 Mtrs. from the villages of Lalpur Taluka SCA/521/2003 6/73 JUDGMENT and on parts of those lands, quarters were constructed, but 800 quarters are lying vacant as well as unused and, therefore, need to acquire lands for erection of dwelling houses for workmen of the company is not genuine. It is mentioned that no material is supplied by the respondent No.4 to the Government to establish its need to acquire lands of the petitioners nor the Government is objectively satisfied that the acquisition is in the interest of public at large and, therefore, notification under Section 4 as well as declaration under Section 6 of the Act are bad in law. According to the petitioners, acquisition is for personal benefits of office-bearers, promoters and directors of the company, but not for public purpose and is, therefore, bad in law. It is claimed that though thousands of acres of lands are acquired by the respondent No.4, the petitioners are sought to be deprived of their valuable and good fertile lands and as the lands of the petitioners are not suitable for the purpose for which they are sought to be acquired, the acquisition proceedings should be regarded as illegal. It is mentioned in the petition that as the lands proposed to be acquired are agricultural lands, it was necessary to consult the Senior Agricultural Officer of the District to ascertain whether the lands were good SCA/521/2003 7/73 JUDGMENT agricultural lands, but record does not indicate that any consultation had taken place with the Senior Agricultural Officer of the District and, therefore, the report forwarded under Rule 4 of the Rules is bad in law. According to the petitioners, no opportunity of hearing was given either by the State or by the Collector or by the Deputy Collector and as the principles of natural justice were violated, notification under Section 4 and declaration under Section 6 of the Act challenged in the petition should be struck down. It is stated by the petitioners that the acquisition proceedings were initiated and continued and are going on in collusion with the respondent No.4, which is a powerful financial wizard and as the lands of the petitioners are selected maliciously, relief claimed in the petition should be granted. It is averred that agreement entered into between the respondent No.4 and the Government is bad in law because the petitioners were never heard nor Rule 4 of the Rules complied with nor the matters specified in Rule 4 of the Rules were considered and, therefore, notification under Section 6 of the Act should be regarded illegal. It is mentioned that the Government did not consult the Committee as required by Rule 4 of the Rules and, therefore, acquisition proceedings should SCA/521/2003 8/73 JUDGMENT be regarded as bad in law. According to the petitioners, the principles of natural justice are violated while conducting inquiry under Rule 4 of the Rules and as negotiations had not taken place with the respondent No.4, the petition should be accepted. The petitioners have emphasized that reasonable price was never offered by the respondent No.4 and, therefore, acquisition proceedings should be regarded as illegal. It is stated by the petitioners that the lands of the petitioners contain plenty of water and, therefore, acquisition of fertile lands when other alternative suitable lands are available, should be regarded as illegal. The petitioners have mentioned that no opportunity of hearing under Section 5A of the Act was accorded to the petitioners and, therefore, notification under Section 6 being void ab initio, should be set aside. It is mentioned that notice issued under Section 9 of the Act is bad in law as mandatory provisions of the Act enacted for acquisition of lands for a company are violated. Under the circumstances, the petitioners have filed instant petition and claimed the reliefs to which reference is made earlier. 4. On notice being served, the respondent No.4 SCA/521/2003 9/73 JUDGMENT company has opposed the petition by filing reply affidavit of Mr.Nilesh H.Baxi, who is General Manager (Legal). In the reply, a preliminary objection that the petition filed is barred by the principles of delay and laches, is raised. It is stated that notification under Section 4 of the Act was published in Government Gazette on May 14, 2001 and public notice was published in “Sandesh” and “Indian Express” dailies of July 2, 2001 whereas Section 6 declaration was published on April 9, 2002 and notices under Section 9 of the Act were issued on July 31, 2002 before which the company had furnished bank guarantee of Rs.26,34,837=00 on September 8, 2001 and also executed an agreement as contemplated by Section 41 of the Act on October 5, 2001, but the petition is filed belatedly on January 15, 2003 and, therefore, the same should be treated as barred by the principles of delay and laches. It is stated in the reply that need to acquire the lands is genuine and though the respondent No.4 has applied for Kharaba lands belonging to the Government, it is neither granted nor Kharaba land is contiguous nor touching to the boundaries of the existing colony and, therefore, the petitioners are not right in contending that the need for acquisition of lands is not genuine. It is denied in the reply that SCA/521/2003 10/73 JUDGMENT 800 quarters are vacant and unused and it is emphasized that 2000 employees of the respondent No.4 company with their families are residing in the rented premises in Jamnagar City as well as Village Moti Khavdi and, therefore, it is not true to say that the need of the company to acquire the lands is not genuine. It is pointed out that the petrochemical and petroleum refineries by their very nature are huge projects, which require large parcel of lands and earlier acquisition of lands admeasuring 126 Hectare 26 RA 7 Mtrs. cannot be regarded as excessive when I.P.C.L., which was formerly a Government Undertaking, acquired more than 800 Hectare of lands whereas Union of India built its petrochemical complex at Gandhar in 1990 on lands admeasuring 800 Hectares of lands. It is mentioned in the reply that the respondent company has set up its refinery in Jamnagar area and for the said purpose, it has acquired only that much land which is required. It is explained that the respondent company, being corporate body, cannot afford to waste money after unnecessary lands as it is bound to increase its overhead expenses which would, in turn, diminish profits and as the respondent No.4 is conservative in acquisition of the lands of private parties, the acquisition of the lands in this case should SCA/521/2003 11/73 JUDGMENT not be regarded as excessive. Dealing with the contention that the mandatory requirements of Section 40 of the Act and Rule 4 of the Rules have not been complied with, it is stated that the Collector forwarded his report with the report of the Senior Agricultural Officer, and the Government on receipt of the same forwarded it to the Land Acquisition Committee for its consideration and, therefore, it is not correct to say that the mandatory requirements of law have not been fulfilled. It is mentioned that after considering the report of the Collector, the Government was satisfied that (1) the lands were required for expansion of housing colony of the workmen employed; (2) the said requirement was genuine; (3) the land sought to be acquired was best suited for the purpose; (4) the area of the land sought to be acquired was not excessive; (5) no other alternative lands were available; and, (6) the respondent No.4 had offered amount higher than the prevailing market value for obtaining lands by private negotiations and private negotiations had failed etc. and, therefore, it is not right to contend that requirements of Section 40 of the Act were not complied with. It is mentioned in the reply that the Collector while making inquiry under Rule 4 had issued letters dated February 28, 2001 and called SCA/521/2003 12/73 JUDGMENT upon the petitioners and others to remain present in his office for personal hearing, but the petitioners did not remain present and, therefore, it is wrong to contend that inquiry under Rule 4 of the Rules is bad in law. According to the respondent No.4, acquisition for constructing the housing colony and amenities related thereto have been always considered as for public purpose and it is pointed out that large project generates substantial revenue as well as foreign exchange to the nation and also provides employment on large-scale to the residents in the area and, therefore, it is not correct to plead that the acquisition is only for the benefits of the officers of the company. While dealing with the plea that there was absence of consultation with Senior Agricultural Officer, it is stated that the report of the Collector with the report of the Senior Agricultural Officer was received by the Government and forwarded by the Government to the Land Acquisition Committee and the report of the District Agricultural Officer, Jamnagar, dated April 3, 2001, mentions, inter alia, that the lands of the petitioners are ordinary, non-irrigated, agricultural lands. Refuting the claim of the petitioners that they were not heard in inquiry under Section 5A of the Act, it is asserted that after Section SCA/521/2003 13/73 JUDGMENT 4 notification, the petitioners filed objections on July 10, 2001 and, therefore, the Collector had called the petitioners and others for hearing on July 23, 2001 regarding which necessary Rojkam was prepared and the report was forwarded to the Government on December 24, 2001 which was considered by the Government and the Government after consulting the Land Acquisition Committee issued declaration under Section 6 of the Act on April 9, 2002. In the reply, it is emphasized that the lands are not acquired in colourable exercise of powers and as the averments made regarding mala fide exercise of powers are vague and not specific, the same should be ignored by the Court. The deponent of the affidavit-in-reply has mentioned that the statutory agreement under Section 41 of the Act was executed by the respondent No.4 on October 14, 2001, which was published in the Government Gazette on March 15, 2002 and by virtue of Section 42 of the Act, it has become part of the Act and, therefore, the petition should be dismissed. In answer to the claim of the petitioners that negotiations had not taken place with their father, it is mentioned that three letters dated December 18, 2000 were properly addressed and sent to the father of the petitioners under Certificate of Posting, but the father SCA/521/2003 14/73 JUDGMENT of the petitioners did not remain present and, therefore, the proposal dated December 27, 2000 was forwarded to the Collector and the Deputy Secretary to acquire the lands in question. In the reply, it is mentioned that Survey No.25, which is adjoining the lands of the petitioners was purchased by its owner on May 8, 1997 for Rs.3,80,000=00, i.e. at the rate of Rs.13,305=00 per Vigha whereas the respondent No.4 offered Rs.20,500=00 per Vigha for non-irrigated lands and Rs.38,000=00 per Vigha for irrigated lands and, therefore, it is not correct to say that reasonable price was not offered by the respondent No.4. Dealing with the contention raised by the petitioners that valuable fertile lands are sought to be acquired, it is stated in the reply that Village Forms No.7/12 produced by the petitioners show that they were taking one crop in a year and that too of Bajra whereas report of the District Agricultural Officer dated April 3, 2001 mentions that the lands of the petitioners are ordinary, non-irrigated agricultural lands and, therefore, the claim that highly fertile lands are sought to be acquired, should not be accepted by the Court. By filing reply, the deponent has demanded dismissal of the petition. SCA/521/2003 15/73 JUDGMENT 5. Mr.A.B.Rathod, Deputy Collector, Jamnagar, has filed affidavit-in-reply on behalf of the respondent No.3 controverting the averments made in the petition. In the reply, it is mentioned that it is not true that the lands of the petitioners, which are acquired, are highly fertile and garden lands and it is stated that as per extracts of Village Form No.7/12, the lands of the petitioners are Jirayat lands and this fact is also borne out from the report of the District Agricultural Officer wherein it is stated that the lands of the petitioners are non-irrigated and Jirayat lands. With reference to the plea that no hearing was given to the petitioners under Section 5A of the Act, it is stated that the Deputy Collector, Jamnagar, issued notice dated June 16, 2001 under Section 4(1) of the Act and invited objections from the petitioners and other affected persons to be filed on or before July 17, 2001 and they were also asked to appear in-person or through advocate on July 23, 2001 for personal hearing and as the petitioners submitted reply/objections on July 10, 2001, it is not true to say that no hearing was afforded to the petitioners under Section 5A of the Act. The allegation made by the petitioners that the respondent No.3 has not properly appreciated and considered the objections, is SCA/521/2003 16/73 JUDGMENT emphatically denied and it is stated that reply and objections filed were properly considered by the respondent No.3. With reference to inquiry under Rule 4 of the Rules, it is asserted in the reply that a letter/notice dated February 28, 2001 was addressed to the petitioners, which was sent under Certificate of Posting wherein it was specifically informed that the deceased should remain present in the office of the Deputy Collector on March 12, 2001 if he wanted to make representation at the inquiry to be conducted under Rule 4 of the Rules read with Section 40 of the Act and on that day only, Bhanji Kanabhai remained present, but the deceased father of the petitioners did not remain present regarding which a detailed Rojkam was prepared on that day mentioning all relevant facts and, therefore, the plea that principles of natural justice were violated while conducting inquiry under Rule 4 of the Rules should not be accepted by the Court. In the reply, other facts are also stated, but this Court feels that detailed reference to the same is not warranted and, therefore, detailed reference to those facts is avoided at this stage. Thus, by filing detailed reply, the Deputy Collector, Jamnagar, has pointed out that all the relevant provisions of law were complied with before SCA/521/2003 17/73 JUDGMENT acquiring the lands of the petitioners for respondent No.4-company, and has prayed to dismiss the petition, which has no substance. 6. Mr.Surubha Raghuji, who is Power of Attorney Holder of the petitioners, has filed rejoinder to the reply of Mr.Baxi filed on behalf of the respondent No.4 Company and controverted the averments made therein. He has, by and large, reiterated the facts stated in the petition and, therefore, detailed reference to the same is not made. 7. Mr.C.S.Upadhyay, Deputy Secretary, Revenue Department, has filed reply affidavit on behalf of State controverting the averments made in the petition. In the reply, it is mentioned that notification under Section 4 and declaration under Section 6 of the Act as well as proceedings for acquisition of the lands registered as L.A.Q. Case No.4 of 2001 by the Government were challenged by one Kiritsinh R. Vala, who was owner of Survey No.46/1/1/1/1/3 by way of filing Special Civil Application No.8550 of 2002 and by Sejpal Mapa, who was owner of Survey No.29 Paiki, by filing Special Civil Application No.8551 of 2002 and Mr.A.B.Rathod, Deputy SCA/521/2003 18/73 JUDGMENT Collector, had filed affidavit-in-reply on September 23, 2002 in Special Civil Application No.8550 of 2002 whereas Mr.G.D.Vyas, Secretary, Land Reforms, had filed affidavit on January 22, 2003 and Mr.G.K.Malvi, Mamlatdar, Jamnagar, had filed affidavit on August 26, 2003, but those two petitions have been disposed of as withdrawn and as the issues raised in instant petition are similar and identical to those raised in the two disposed of petitions, he is craving leave of the Court to produce those affidavits filed in two disposed of petitions on the record of instant petition and rely upon the same to refute the claim of the petitioners. After craving leave as referred to above, Mr.C.S.Upadhyay, Deputy Secretary, Revenue Department, has produced along with his reply (1) affidavit-in-reply filed by Mr.G.D.Vyas, Secretary, Land Reforms, filed in Special Civil Application No.8550 of 2002 with annexures including (a) report dated April 12, 2001 forwarded by the Deputy Collector, Jamnagar, to the Collector, Jamnagar, after holding inquiry under Rule 4 of the Rules read with Section 40 of the Act; (b) order of the Collector, Jamnagar, dated January 25, 2001 designating the Deputy Collector, Jamnagar, to conduct inquiry under Rule 4 of the Rules read with Section 40 of the Act; (c) Rojkam dated July 23, 2001 prepared by the SCA/521/2003 19/73 JUDGMENT Deputy Collector, Jamnagar, while conducting inquiry under Section 5A of the Act; (2) affidavit-in-reply filed by Mr.Arjunsinh B.Rathod, Deputy Collector, Jamnagar, in Special Civil Application No.8550 of 2002 with annexures, which were produced by Mr.G.D.Vyas, Secretary, Land Reforms, with his reply; (3) affidavit of Mr.G.K.Malvi, Mamlatdar, Jamnagar (Rural), Jamnagar, filed in Special Civil Application No.8550 of 2002 with annexures including (a) intimation dated March 7, 2001 from Talati- cum-Mantri, Moti Khavdi, to the Deputy Collector, Jamnagar, stating that the landowners mentioned therein were not staying in the Village and, therefore, notices were affixed on lands of the owners; (b) panchnama dated March 7, 2001 indicating that notices dated February 28, 2001 sent by the Collector to Talati-cum-Mantri, Moti Khavdi, to be served upon land-holders were affixed on lands; (c) intimation dated March 3, 2001 sent by the Deputy Collector, Jamnagar, to Talati-cum-Mantri, Moti Khavdi, stating that notices issued to the land holders before conducting inquiry under Rule 4 of the Rules read with Section 40 of the Act which were sent under Certificate of Posting were received back unserved and asking the Talati-cum-Mantri to serve notices