IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No 4271 of 2000 AND SPECIAL CIVIL APPLICATIONS NOS. 1189, 4494, 4659, 5934 AND 7476 ALL OF 1998 with Civil Applications No.10818 and 12557 both of 1999 in Special Civil Application No.4494 of 1998 with Civil Application No. 8879 of 1999 in Civil Application No. 7269 of 1999 in Special Civil Application No.1189 of 1998 with Civil Applications No.10816 and 12559 both of 1999 in Special Civil Application No. 4659 of 1998 with Civil Application No.2167 and 10812 both of 1999 in Special Civil Application No. 7476 of 1998 For Approval and Signature: Hon'ble CHIEF JUSTICE MR DM DHARMADHIKARI and Hon'ble MR.JUSTICE A.R.DAVE ============================================================ 1. Whether Reporters of Local Papers may be allowed : YES to see the judgements? 2. To be referred to the Reporter or not? : YES 3. Whether Their Lordships wish to see the fair copy : YES of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? : NO -------------------------------------------------------------- AHMEDABAD GREEN BELT KHEDUT MANDAL Versus STATE OF GUJARAT, THROUGH SECRETARY -------------------------------------------------------------- Appearance: sca Mr Raja Ramchandran with MR CC BHALJA for Petitioners 4271/ Mr. S.N.Shelat, AAG with AJ Desai AGP for Respondent No. 1 2000 MR NV ANJARIA for Respondent No. 2 sca Mr.Raja Ramchandran with Mr.YNOza for petitioner 1189/ Mr.SN Shelat, AAG with AJDesai AGP for State 1998 sca Mr SH Sanjanwala with RS Sanjanwala for pet. 4494&4659/ MR PG Desai GP for R 1 and 2 1998 Mr.SN Shelat, AAG with AJ Desai AGP for State sca Mr AJ Patel for petitioner 5934/ Mr.SN Shelat, AAG with AJ Desai AGP for State 1998 sca Mr.SH Sanjanwala with RH Sanjanwala for pet. 7476/ Mr SN Shelat, AAG with AJ Desai AGP for State 1998 -------------------------------------------------------------- CORAM : CHIEF JUSTICE MR DM DHARMADHIKARI and MR.JUSTICE A.R.DAVE Date of decision:24/11/2000 COMMON C.A.V. JUDGEMENT (Per : CHIEF JUSTICE MR DM DHARMADHIKARI) #. This petition under Article 226 of the Constitution had been preferred by an Association of Land Owners within the development area of Ahmedabad Development Authority. This petition shall also decide the group of other petitions mentioned above as common questions of law arise for decision. #. The petitioners challenge the constitutional validity of the provisions of Section 12 of the Gujarat Town Planning and Urban Development (Amendment) Act, 1999 (Gujarat Act No. 2 of 1999), whereby amongst other provisions, amendment has been introduced by substituting impugned clause (jj) in subsection (3) of Section 40 of the parent Act, i.e., The Gujarat Town Planning and Urban Development Act, 1976 (hereinafter referred to shortly as `the parent Act' and the `Amendment Act' respectively). The parent Act of 1976 in the State of Gujarat is successor to the Bombay Town Planning Act of 1954 which was applicable to the new State of Gujarat. The Preamble of the parent Act indicates, the object of the Act to be one enacted `to consolidate and amend the law relating to the making and execution of development plans and town planning schemes in the State of Gujarat'. It is a State legislation and the source of legislative power is derived from Entry 18 of State List and Entry 20 of the Concurrent List. #. For appreciating and weighing the worth of grounds urged for challenging the impugned legislation, a brief survey of the provisions of the parent Act and the Amendment Act would be necessary. The broad features of the parent Act are: Chapter II contains the provisions for creation of larger area of development defined as "development area" and for constitution of `Area Development Authorities' for the purpose of development. The main functions of the Area Development Authority under Section 7 are amongst others to undertake preparation of development plans for the `Development Area' and for preparation and execution of `town planning schemes'. Section 12 of the parent Act describe various proposals and reservations to be made in the development plan to be approved by the State Government. Subsection (2) of Section 20 enables reservation of lands for residential, industrial, commercial, agricultural and recreational purposes, land to be reserved for community facilities and services and for other public purposes. Section 20 of the parent Act which is very material for the purposes of this group of petitions is a provision enabling acquisition of land by the Development Authority for any of the public purposes specifically mentioned in certain clauses of subsection (2) of Section 12. The land designated and reserved for public purposes is required to be acquired under an agreement with the land owners or under the provisions of Land Acquisition Act. Subsection (2) of Section 20 provides that lands for development can be acquired within 10 years from coming into force of final development plan, or within six months of notice served by the land owner or person interested. Non-acquisition within the stipulated time has the legal effect of dereservation of the land designated for a specific purpose. Section 20 being relevant for considering the merits of the grounds urged in this petition, is required to be reproduced in full: "Sec. 20. Acquisition of land. (1) The area development authority or any other authority for whose purpose land is designated in the final development plan for any purpose specified in clause (b), clause (d), clause (f), clause (k), clause (n) or clause (o) of sub-section (2) of section 12, may acquire the land either by agreement or under the provisions of the land Acquisition Act, 1894 (I) of 1894. (2) If the land referred to in sub-section (1) is not acquired by agreement within a period of ten years from the date of the coming into force of the final development plan or if proceedings under the Land Acquisition Act, 1894 (i) of 1894, are not commenced within such period, the owner or any person interested in the land may serve a notice on the authority concerned requiring it to acquire the land and if within six months from the date of service of such notice the land is not acquired or no steps are commenced for its acquisitions, the designation of the land as aforesaid shall be deemed to have lapsed." #. At this stage, it may be necessary to mention that the scope and meaning of Section 20 of the Act came for consideration before this Court before Division Bench (D.M. Dharmadhikari, C.J. and J.M. Panchal, J) of which one of us, namely, D.M. Dharmadhikari, C.J. was a party in a group of petitions decided with Special Civil Application No. 3537 of 1995 Palitana Sugar Mills Private Ltd. Vs. State of Gujarat. The judgment in that case is being delivered today along with this group of petitions. The Division Bench of this Court in the group petitions of Palitana Sugar Mills Private Limited interpreted the provisions of Section 20 of the Act in the light of the scheme and other provisions of the Act and came to the conclusion against the contention of the State that by mere issuance of a revised development plan under Section 21 of the Act, the legal effect of dereservation of designated land for the public purposes under the development plan on failure of acquisition within 10 years and despite service of six months notice, is not nullified. #. Chapter V of the parent Act contains the provision regarding town planning schemes. Section 40 under Chapter V of the Act enables the Appropriate Authority to prepare town planning schemes in accordance with the final development plan. Subsection (3) of Section 40 is also an enabling provision for the Authorities to undertake various development plans in the town planning schemes e.g. levelling the land for carving out plots, earmarking lands for roads, open spaces, gardens, allotting land for public purposes, such as lighting, water supply and other ancillary matters relating to the town planning. Original clause (jj) in subsection (3) of Section 40, prior to its substitution by the impugned amendment by Gujarat Act No. 2 of 1999, which was introduced by Gujarat Amendment Act No. 4 of 1986, reads as under: "40(3)(jj) as it stood on insertion by Gujarat Act of 1986 before its substitution by Gujarat Act No. 2 of 1999:- (3) A town planning scheme may make provision for any of the following matters: (a) to (i) and (j) xx xxx xx xxx xx (jj) The allotment of land to the extent of 10% or such percentage as near thereto as possible of the total area covered under the scheme, for the purpose of sale for residential, commercial or industrial use" By the Gujarat Act No. 2 of 1999, the impugned clause (jj)(a)(i) to (iv) with proviso thereunder has been substituted for the original clause (jj) and the amendment reads as under:- "(jj)(a) The allotment of land from the total area covered under a scheme, to the extent of - (i) 15% for roads, (ii) 5% for parks, playgrounds, gardens and open spaces, (ii) 5% for social infrastructure such as schools, dispensary, fire brigade, public utility place as earmarked in the draft town planning scheme, (iv) 15% for sale by Appropriate Authority for residential, commercial or industrial use depending upon the nature of development, provided that the percentage of the allotment of land specified in paragraphs (i) to (iii) may be altered depending upon the nature of development and for the reasons to be recorded in writing. (b) The proceeds from the sale referred to in paragraph (iv) of subclause (a) shall be used for the purpose of providing infrastructural facilities. (c) The land allotted for the purposes referred to in paragraphs (ii) and (iv) of subclause (a) shall not be changed by variation of schemes for the purposes other than the public purpose." The other provisions of the parent Act shall be dealt with while considering the various grounds urged to challenge the impugned legislation. #. Learned counsel, who appeared for the petitioners in this group of petitions, separately addressed this Court at great length. The main ground of challenge is that the impugned legislation is an ill-conceived legislative device to again reserve the same area or land which automatically stood dereserved because of its non-acquisition within the stipulated period under subsection (2) of Section 20 of the Act being a provision regarding the development plan. #. The ancillary ground urged is that the land which was not acquired on payment of compensation under Section 20 of the Act cannot again be acquired indirectly and without payment of compensation by introducing the impugned legislation to enable the Appropriate Authority to prepare a town planning scheme and reserve the land at the specified percentage for public purposes like roads, parks, playgrounds, gardens and open spaces. It is submitted that the impugned legislation is inconsistent with the remaining provisions of the Act. It is an attempt to acquire property by framing scheme without payment of compensation under the Land Acquisition Act. It amounts to enacting an unreasonable law resulting in deprivation of the property of the land owners contrary to the constitutional right guaranteed under Article 300A of the Constitution. #. The most serious objection commonly raised by the learned counsel on behalf of the petitioners is to subclause (iv) of clause (jj)(a) of subsection (2) of Section 40, which enables the Appropriate Authority in making a town planning scheme to reserve 15% of the land within the scheme to be utilised for sale by the Appropriate Authority for residential, commercial or industrial use. The submission made on behalf of the petitioners is that such provision of reservation of land to be sold by the Appropriate Authority for raising the money for the purpose of providing infrastructural facilities is a provision which is beyond the legislative competence of the State and falls outside the Entry 18 of the State List or Entry 20 of the Concurrent List. The provision is severely criticized by stating that there is an attempt to add to the funds of the Appropriate Authority under the Act from the properties belonging to the petitioners. It is submitted that in the garb of planning and preparation of town planning schemes, money making projects cannot be allowed to be undertaken with the help of properties of citizens. It is submitted that town planning or urban development does not permit acquisition of certain percentage of properties of citizens for its disposal in the hands of public Authorities for the purpose of raising its funds, may be, for use of those funds for further development. It is submitted that the funds of Appropriate Authority are those mentioned in Section 91 and sale proceeds of certain percentage of land acquired from land owners do not constitute the legitimate funds of the Appropriate Authority as provided in Section 91. It is submitted that compensation payable under Section 82 of the parent Act in respect of property or right injuriously affected by the scheme, on the basis of market value obtaining on the date of declaration of intention to make a scheme, is not an adequate compensation. The compensation which the citizens would otherwise be entitled to be awarded is in accordance with the Land Acquisition Act. It is submitted that right to property is no longer a fundamental right under Article 19, but, it continues to be a constitutional right under Article 300A of the Constitution. Article 300A prohibits the State from depriving the citizen of his right to property "save by authority of law". The authority of law, it is argued, mentioned under Article 300A of the Constitution, means by authority of law which is reasonable. It is argued that the impugned piece of legislation is the misconceived law enacted to deprive the land owners of their right to property without payment of compensation in accordance with Land Acquisition Act. The scheme framed is not consistent with the provisions of the parent Act and cannot be said to be valid and reasonable law. #. Some other ancillary points urged on behalf of the petitioners by one of the counsel arguing for them also deserve to be noted. It is pointed out that under the parent Act, Section 40(3)(j) as it original stood merely provided for only 10% of the land to be reserved in the town planning scheme for providing housing accommodation to members of the weaker sections. That provision contained in clause (j) is still on the statute book. As mentioned above, clause (jj) was introduced by Gujarat Act No. 4 of 1986. After its introduction, the two clauses (j) and (jj) as stood prior to their substitution by (jj)(a)(i) to (v), (b) and (c) read as under:- "40(3) A town planning scheme may make provision for any of the following matters, namely:- (a) to (i) xx xx xx xx xx xx (j) the reservation of land to the extent of ten per cent; or such percentage as near thereto as possible of the total area covered under the scheme, for the purpose of providing housing accommodation to the members of weaker sections and of buildings actually used for religious purposes; (jj)the allotment of land to the extent of ten per cent, or such percentage as near thereto as possible of the total area covered under the scheme, for the purpose of sale for residential, commercial or industrial use; ##. As quoted above, prior to the impugned amendment and substitution of clause (jj)(a) to subsection (3) of Section 40 the Appropriate Authorities were permitted at the time of framing town planning scheme to reserve land total to the extent of 20%, i.e., 10% for housing accommodation for weaker sections and 10% for the purpose of sale. The sale of plots was not permitted to be made by the Appropriate Authority in the unamended clause (jj)(a), may be, the sale of the plots in contemplation was through the land owners under the scheme. ##. The learned counsel appearing in Special Civil Application No. 4271 of 2000 has urged an additional ground that the State Government in these petitions has not shown any justification in their reply affidavit for increasing the percentage of reservation of lands for public use from 20% to 50%. The percentage of reservation now provided under the town planning scheme is as under: 10% for weaker sections - (j) 15% for roads - (jj)(a)(i) 5% for park, playgrounds, gardens and open spaces (jj)(a)(ii) 5% for social infrastructure such as schools, dispensary, fire brigade, public utility places as earmarked in draft town planning scheme (jj(a)(iii) 15% for sale by appropriate authority for residential accommodation, commercial and industrial use (jj) ---- 50% Total ---- ##. It is submitted that the State has not been able to justify in its reply affidavit the increase of percentage of reservation to the extent of 50%. The reservation of land for the town planning scheme to the extent of 50% is, therefore, arbitrary, unreasonable and violative of Article 14 of the Constitution of India. It is submitted that such high percentage of reservation is liable to be struck down on the ground that reservation whatsoever made in the development plan has lapsed under Section 20 of the Act because of non-acquisition of the land by agreement or on payment of compensation under acquisition Act to the land owners. ##. The other ancillary grounds urged is that the State in its reply has agreed for its liability to pay compensation for the land reserved on the market value of the land as obtaining on 21-1-1999 being the date of publication of declaration of intention by the Appropriate Authority to frame the town planning scheme in accordance with Section 82 of the parent Act. The argument advanced is that although Article 300A does not require that the law resulting in deprivation of property should provide for payment of compensation under the Land Acquisition Act, but, compensation payable under a law, which is found reasonable at a given point of time may be found unreasonable and illusory with the long passage of time. It is submitted that the decision to frame town development scheme was taken several years back and payment of compensation at the market price existing on the date of declaration of intention of making the scheme would be highly illusory and unrealistic. The impugned legislation, therefore, cannot be described to be a just, fair and reasonable law, within the meaning of Article 300A. ##. The learned Addl. Advocate General Shri S.N. Shelat, who appeared for the State and the various public authorities in his reply supported the impugned legislation. The stand taken by him will be dealt with by us while considering various grounds of challenges urged on behalf of the petitioners. I LEGISLATIVE COMPETENCE ##. We shall take up first for our consideration the petitioners challenge to the impugned legislation on the ground of alleged want of legislative competence. The legislative competence of Bombay Town Planning Act, 1954 which is predecessor of the parent Act of 1976 came to be challenged on the basis of legislative competence in the Supreme Court in the case of Maneklal Chhotalal and others v. M.G. Makwana and others AIR 1967 SC 1373. The Supreme Court upheld the legislative competence of the State Legislature under Entry 18 of List II and Entry 20 of List III. Entry 18 of State List II reads:- "Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents, transfer and alienation of agricultural land; land improvement and agricultural loans; colonization." ##. An important principle to interpret the Entries is that none of them should be read in a narrow or restricted sense. The "widest possible" and "most liberal" construction is to be put on each Entry and each general word in a Entry should be held to extend to all ancillary and subsidiary matters which can fairly and reasonably be said to be comprehended in it. The justification for this approach is that the Entries set up are on `machinery of government'. They are "heads" or "fields" of legislation and, therefore, `they must be given the widest scope of which their meaning is fairly capable'. (See United Provinces v. Atikabegam AIR 1941 FC 16, Calcutta Gas Co. Vs. West Bengal AIR 1962 SC 1044 and Harakchand vs. India AIR 1970 SC 1453) ##. In Atma Ram v. State of Punjab AIR 1959 SC 519 (at 523) Item 21 of List II of Government of India Act, 1935 which is comparable and almost similar to Entry 18 of List II of the Constitution, came up for construction and interpretation. It was observed : "As to item 21, `land', the governing word is followed by the rest of the item, which goes on to say, `that is to say', These words introduce the most general concept - `rights in or over land'. `Rights in land' must include general rights like full ownership or leasehold or all such rights. `Rights over land' would include easements or other collateral rights, whatever form they might take. Then follow words which are not words of limitation but of explanation or illustration, giving instances which may furnish a clue for particular matters." The second relevant Entry 20 in Concurrent List III reads:- "20. Economic and social planning". In `Principles of Town and Country Planning' by Lewis Keepl, the scope of planning has been stated thus: "Planning has both social and economic aims. Socially, successful Planning tends to make people's lives happier because it results in a physical environment which conduces to health, which allows convenient and safe passage from place to place which facilitates social intercourse and which has visual attractiveness. The economic results of good Planning also, of course, conduce to increase happiness, but not quite so directly. A proper spatial relationship between the communities in a region and the constituent parts of a town compactness of development, and an efficient arrangement of communication routes all result in human activities being carried on more efficiently and less wastefully, and thus increase wealth" ##. In the case of Maneklal Chhotalal (supra), the Entry 20 has been construed in the light of the activities involved in town and country planning, as understood generally by those in Local Authorities dealing with systematic development and urban and rural areas. The law of town planning aims at fulfilling social and economic objectives. City Planning takes effect largely through operations of Government and requires the application of specialised techniques of survey, analysis, forecast and design. It is in the light of the scope of the aforementioned Entries that we have to consider whether the impugned legislation is within the competence of State Legislature. As has been held by the Supreme Court in the case of Maneklal Chhotalal (supra) Entry 18 of List II and Entry 20 of List III as `Heads of' legislation has to be given widest possible meaning. In Chapter V of the parent Act provisions are made for preparation and implementation of town planning schemes. Under Section 40(3)(c) and (e) a town planning scheme is required to include amongst others the matters mentioned therein, i.e.,lay out of new streets or roads, construction, diversion, extension, alteration, improvement and closing up of streets and roads and discontinuance of communications; the allotment or reservation of land for roads, open spaces, gardens, recreation grounds, schools, markets, green-belts, dairies, transport facilities, and public purposes of all kinds. The original Clause (jj), as was inserted by Gujarat Act of 1986, contained a provision for allotment of 10% of land in the scheme or such percentage as near thereto as possible for the purpose of sale for residential, commercial and industrial use. By substituting the impugned provision, i.e., clause (jj)(a)(i) to (iv), there is merely specification of expected percentage of land to be reserved for various purposes already mentioned in the parent Act in subsection (3) clause (c) and (e) (quoted above). In