C.W.P No. 11461 of 2005 ::1:: IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH C.W.P No. 11461 of 2005 Date of decision : March 28, 2008 1. CWP No.11461 of 2005 M/S Golden Iron & Steel Forging vs Union of India & others 2. CWP No.626 of 2006 Dynamac (India) Pvt Ltd vs Union of India & others 3. CWP No.10687 of 2006 Sudhir Bansal & another vs Union of India & others CORAM : HON'BLE MR.JUSTICE UMA NATH SINGH HON'BLE MR.JUSTICE RAJIVE BHALLA *** Present : Mr.M.L.Sarin, Sr.Advocate, with Mr.Hemant Sarin, Advocate for the petitioner in CWP No.11461 of 2005. Mr.R.S.Mittal, Sr.Advocate with Mr.Sudhir Mittal, Advocate for the petitioner in CWP No.626 of 2006. Mr.Jaswant Jain, Advocate with Mr.Ajay Jain, Advocate for the petitioners in CWP No.10687 of 2006 Mr.Ashish Kapoor, Addl.A.G Haryana and Ms.Ritu Punj, DAG, Haryana Mr.Kamal Sehgal, Advocate for respondent No.1. Mr.Rajiv Atma Ram, Sr.Advocate with Mr.Ashim Bhutt, Advocate, for respondent No.2. Mr.Ashok Aggarwal, Sr.Advocate, with Mr.Alok Jain, Advocate for respondent No.4. **** C.W.P No. 11461 of 2005 ::2:: 1. Whether Reporters of Local Newspapers may be allowed to see the judgment ? 2. To be referred to the Reporters or not ? 3. Whether the judgment should be reported in the Digest ? *** RAJIVE BHALLA,J This order shall dispose of CWP Nos.11461 of 2005, 626 and 10687 of 2006. The petitioners impugn notifications, dated 13.4.2005 and 11.7.2005, issued and published under Section 3-A(1) of the National Highways Act, 1956 (for short herein after referred to as “the Act”), and Section 3-D of the Act, respectively, acquiring the petitioners' land for building of NH No.8 from KM 24000 to KM 42000 including construction of a Toll Plaza at KM 42000 in Gurgaon District in the State of Haryana. CWP No.11461 of 2005 Counsel for the petitioner submits that the petitioner is owner of land measuring 23.8 kanals, bearing Khasra Nos.35/4 min East, 5/1, 6/2/2, 7 Min East, situated in village Kherkidaula, Tehsil and District Gurgaon, recorded in the revenue records as agricultural land. The petitioner applied for change of land use under the Punjab Scheduled Roads and Constructed Areas (Restriction of Unregulated Development) Act, 1963. Vide order, dated 3.3.2000, permission was granted for change of land use with respect to 12357 sq. yards. The petitioner constructed a four storeyed building with a covered area of 55,000 sq. feet. The petitioner was approached by officials, representing respondent No.4 (the concessionaire) for lease of this building, as they had been awarded a tender to construct a Toll Plaza at Highway 8. The petitioner declined the request. On C.W.P No. 11461 of 2005 ::3:: 26.5.2005, officials, representing respondent No.4, forcibly entered the petitioner's premises and began taking measurements. The petitioner was handed over a photo copy of the notification, dated 13.4.2005, purportedly published under sub-section (1) of Section 3A of the Act proposing to acquire his building for construction of a Toll Plaza. The petitioner filed objections, before the competent authority- cum-Sub Divisional Magistrate, Gurgaon on 27.5.2005. On 9.6.2005, when the petitioner was called for a hearing, it submitted supplementary/additional objections. The petitioner asserted that the notification was a colourable exercise of power, a mala fide attempt to acquire his building, and the building was wrongly described as agricultural land, whereas it was a factory etc. The petitioner also asserted that as adjoining land was lying vacant, the Toll Plaza could easily be constructed on vacant land without damaging the building. Respondent No.1 filed a reply to the objections and without denying the objections, asserted that the Toll Plaza could not be shifted, in view of the scope of the agreement/project of the Expressway, which had been decided by technical experts. It is further submitted that the competent authority, in its report, dated 28.6.2005, forwarded to the Sub Divisional Magistrate (C), recommended the shifting of the Toll Plaza. The said officer, after recording that the area is heavily populated and a large number of factories exist around the proposed site, recommended that the site of the Toll Plaza be shifted to a vacant area near village Manesar. The Deputy Commissioner, Gurgaon, vide letter dated 29.6.2005, forwarded a request to the Financial Commissioner-cum-Principal Secretary, Public Works Department (B&R), Haryana for shifting of the Toll Plaza. However, in its C.W.P No. 11461 of 2005 ::4:: final order, dated 11.7.2005, the authority recorded a strange order, namely, that though “solid grounds” exist, yet keeping in view public interest, the objections could not be accepted. It is submitted that the aforementioned rejection is contradictory to and in derogation to the powers, conferred upon the competent authority, under the Act. The prescribed authority, under the Act, has to act independently, while examining the pros and cons of an acquisition. Objections cannot be rejected by stating that the objections are not acceptable in view of the public interest. Section 3C(1) of the Act entitles a landowner to file objections “...... to the use of the land ....” i.e the public purpose set out in the notification, issued under Section 3-A of the Act. Section 3C(2) of the Act requires the competent authority to grant an opportunity of hearing to an objector and after hearing all such objections as may be raised and after making further enquiry, the competent authority may allow or disallow the objections. Thus, a prescribed authority is required to pass a reasoned order, while allowing or rejecting objections. A perusal of the order, dated 11.7.2005, rejecting the petitioner's objections discloses a complete non-application of mind and a failure to discharge jurisdiction in accordance with law. The order is cryptic, non-speaking, void and, therefore, violates the provisions of Section 3C of the Act. As the order, rejecting the objections, is void, all subsequent proceedings stand vitiated. It is further submitted that the petitioner's refusal to lease out his factory is the mala fide cause for issuance of the notification. The petitioner's factory measures 55,000 square feet, whereas even if it is conceded that a building is required for the Toll Plaza, the concessionaire does not require such a large building. C.W.P No. 11461 of 2005 ::5:: Another argument, put-forth by counsel for the petitioner, is that the Toll Plaza was intentionally located opposite the petitioner's building. The center line of the road was shifted to the petitioner's side of the road so as to ensure that his building fell within the acquired land. The over all width of the Toll Plaza is 101.8 meters and from the center line of the Highway, respondent No.2 required 50.9 meters on the petitioner's side. In addition, respondent No.2 required 10 meters for services like sewage, drainage, electrical overhead and underground cables, fiber optic cables for telephones as well as cable TV, gas pipe lines etc. The maximum width required on the petitioner's side of the highway was a mere 60.9 meters and under no circumstance would the petitioner's building fall within the proposed Toll Plaza. It is further submitted that the site of the Toll Plaza was changed, without justification. The entire endeavour of respondent No.4 was to ensure that the petitioner's building is acquired. The shifting of the center line towards the petitioner's land, without just cause, and repeated alterations of the plans, clearly establishes mala fides on the part of the respondents. It is further submitted that in order to acquire the petitioner's land, 110 meters have been acquired, on the petitioners' side, whereas only 49 meters have been acquired on the opposite side. It is, thus, apparent that the site of the Toll Plaza, the alteration of its location, the change in the center line were affected, and the plans were so tailored to acquire the petitioner's building. It is further submitted that other factors that strengthen the plea of mala fide is the failure of the respondents to produce the original plan, as directed by this Court, and the alteration of the Center Line, during the pendency of the present writ petition, more C.W.P No. 11461 of 2005 ::6:: particularly after the petitioner made a statement that he has no objection to the construction of the Toll Plaza, provided his building is excluded from acquisition. It is further argued that the notification, issued under Section 3 of the Act, refers to acquisition of agricultural land and not to the acquisition of any industrial building, thus, disclosing an absolute non- application of mind. The land use was altered from agricultural to industrial, after due permission was granted, and a building was constructed thereon. . It is further submitted that for the Toll Plaza building, respondent No.4 requires an area for a building measuring 150 sq. feet with two levels. The impugned notifications, however, propose to acquire a four storeyed building with 55000 sq. feet of space. Another argument advanced is that the acquisition of the petitioners' land and building for the benefit of the concessionaire, a private person, and, therefore, cannot be stated to be a public purpose. As regards the vires of the Act, challenge is primarily laid to Act No.16 of 1997, whereby the National Highways Act, 1956 was amended to provide for acquisition of land by the Central Government for the National Highway Authority. It is contended that the provisions for acquisition, being violative of Article 14 of the Constitution of India, are arbitrary, irrational and sacrifice the interest of private landowners. The Amending Act lays down principles and procedures for acquisition that are in stark contrast to the provisions of the Land Acquisition Act, on the ostensible reasoning that the purpose of acquisition would justify such a departure. The Amending Act enacts Section 3, 3A to J, Section 8-A, 8-B and Section 9(2)(aa) of the Act prescribing the C.W.P No. 11461 of 2005 ::7:: procedure for acquisition of land for the National Highway Authority and matters related thereto. Counsel for the petitioners submit that the procedure for acquisition is arbitrary, unreasonable and an unwanted departure from the time honoured procedure, set out in the Land Acquisition Act. The Amending Act, enacted with the ostensible purpose of removing the so called delays in the Land Acquisition Act, in essence, does away with the rights of landowners, while conferring unprecedented powers on the Union to acquire land without providing for procedural safeguards. The rights of landowners have been sacrificed for the so-called “speedy implementation of highway projects”. It is further submitted that the failure to provide an appellate forum to landowner renders the provisions of the Amending Act ultra vires. It is contended that the Amending Act does not provide for payment of statutory benefits as payable under the Land Acquisition Act namely payment of solatium and interest. The purpose underlying acquisitions under the Act is a public purpose, and is therefore no different from public purpose under the Land Acquisition Act. Landowners, whose lands are acquired, under the Land Acquisition Act, would statutorily receive solatium and interest, whereas if their land is acquired under the impugned statue they would not receive any solatium or interest. The nature of public purpose, in the absence of a valid classification based upon an intelligible diffrentia, shall not determine statutory payments of compensation. There is no rationale or classification to deprive landowners of solatium merely because their land is sought to be acquired for “a national highway”. The purpose of acquisition would not determine C.W.P No. 11461 of 2005 ::8:: the extent of compensation, namely, the payment of solatium and interest. As the purpose of acquisition is to acquire land, the State cannot differentiate between land owners, whose lands are acquired under the impugned enactment, and those, whose lands acquired under the Land Acquisition Act. It is vehemently contended that as the purpose of acquisition cannot determine the amount of compensation, Section 3G of the Act violates the provisions of Article 14 of the Constitution and is, therefore, ultra vires. Section 3H of the Act is arbitrary and unconstitutional, as it requires a dispute with respect to the amount of compensation to be compulsorily referred to an arbitrator, under the Arbitration and Conciliation Act, 1996. The Arbitration and Conciliation Act presumes the existence of a binding agreement that would require parties to appoint an arbitrator, and submit their disputes to the Arbitrator. An Arbitrator, in essence, draws his jurisdiction from an agreement. In the absence of any agreement, and infact the existence of an element of coercion that statutorily compels a party to approach an arbitrator, the Amending Act, is illegal and void. It is further contended that the provisions of Section 3-C(2) of the Act are unconstitutional, and arbitrary, as the procedure for disposal of objections is unjust and arbitrary. The right of landowners to raise objections cannot be curtailed by confining the objections to the “user” of the land. This limited right to file objections is in-comprehensible and should, therefore, be struck down. CWP No.626 of 2006 The petitioner herein claims to be the owner of land measuring C.W.P No. 11461 of 2005 ::9:: 17 kanals and 8 marlas, situated in village Kherkidula, Tehsil and District Gurgaon. The petitioner also asserts that it has constructed a factory, after grant of permission for change of land use on 13.9.2005 by the Director, Town and Country Planning, Haryana. Arguments, raised against the acquisition, are in essence, no different to those raised by counsel for the petitioner in CWP No.11461 of 2005 and, therefore, do not merit repetition. CWP No.10687 of 2006 The petitioners herein claim to have purchased land, measuring 8100 sq. yards on 8.9.2004 and 14.10.2004. They, however, do not assert the existence of any structure and in essence, adopt the arguments, raised by counsel for the petitioner in CWP No.11461 of 2005. Counsel for the National Highway Authority, on the other hand, submits that the Delhi-Gurgaon Section of NH-8 from KM 14.300 to KM 42.000 provides a vital link to the Domestic and International Terminal of Indira Gandhi International Airport. It would also serve the rapidly expanding city of Gurgaon and provide connectivity from Delhi to Jaipur. As the available infrastructure was insufficient to accommodate the volume of traffic, it was decided to augment the capacity of the Delhi-Gurgaon Section of NH-8 on a build, operate and transfer basis. Accordingly, to assess the technical feasibility and financial viability, a detailed project report was called from M/S RITES Ltd in June 1997. The report was submitted in June 2000 only with respect to KM 15.000 to KM 36.300. The project was, however, extended upto KM 42.000 in Haryana by upgrading the already existing four lane highway, completed under an Asian Development Bank Funded Project). The final report was submitted in October 2001. The National Highway Authority invited international bids for the project C.W.P No. 11461 of 2005 ::10:: costing Rs.555 crores so as to select a concessionaire to execute the work on a build, operate and transfer basis for a period of 20 years, including a construction period of 30 months. The project consists of 9 fly overs and 2 underpasses. The work was awarded to M/S Jaypee DSC Ventures Ltd (respondent No.2) on 18.4.2002. It is further submitted that the existing entry point is at KM 42.000 and, therefore, the Toll Plaza has to be constructed within KM 42.000. The total length of the Toll Plaza is 810 meters. The length of a KM is 1000 meters and, therefore, the site of the Toll Plaza, cannot be altered or changed. It is further argued that the Toll Plaza road ends at KM 42.000. In case the Toll Plaza is to be shifted to another site, the road would have to be extended or curtailed, thus, necessitating the issuance of fresh tenders and, therefore, jeopardizing the entire project. As regards the plea of mala fide, it is submitted that this plea lacks material particulars as facts necessary to establish a plea of mala fide have not been pleaded. Even otherwise, mala fides are alleged against respondent No.4. As regards the allegation that the Toll Plaza was repeatedly shifted so as to ensure its location opposite the petitioners' building, it is submitted that shifting of the site, was minimal and made prior to the issuance of the notification, under Section 3 of the Act. The allegation that the Toll Plaza was shifted, so as to acquire the petitioners' land/building is, therefore, incorrect and should be rejected. It is further submitted that the petitioners did not raise any plea of mala fide or a plea akin thereto in the objections, filed before the competent authority. These pleas appear to be an after thought. It is further submitted that detailed reasons have been C.W.P No. 11461 of 2005 ::11:: assigned for alteration of the center line (mid line), and the changes in the site of the toll plaza. The concessionaire agreement between the National Highway Authority and respondent No.4 was executed on 18.4.2002. Schedule A of the agreement provides that the project shall consist of a Toll Plazas at KM 42 and KM24 and a small arrangement for toll collection at Indira Gandhi International Airport link road for traffic to Indira Gandhi International Airport. The exact location was to be decided by the concessionaire with the approval of the National Highway Authority of India. Clause 4.1 of Schedule C to the Concessionaire Agreement stipulates the location, and the technical description of these Toll Plazas. The Toll Plaza is required to have a closed system of 16 lanes, each lane being 4.0 meter wide etc. It is further submitted that there is no question of intentionally placing the toll plaza opposite the petitioners' building. The selection of the site depends upon numerous factors. In a high level meeting of the officers of the Ministry of Road, Transport and Highways with the National High Authority and the Government of Haryana on 31.8.2004, the feasibility of shifting the toll plaza was considered and rejected. Subsequently, the task of checking technical feasibility of the proposed toll plaza was entrusted to a Director General,Road Development. A joint inspection was carried out with an independent consultant on 25.3.2005. The report dated 26.11.2005 concluded that the location and the layout design of the toll plaza was in accordance with the provisions of the Concessionaire Agreement, technical operations and site considerations. It is further submitted that during the four laning of the highway under the Asian Development Bank Loan Assistance, two lanes were added on the left side C.W.P No. 11461 of 2005 ::12:: of the Delhi-Jaipur side instead of adding one lane on each side. As a result, the median of the existing four lane carriage-way was not in the center of the right of way. The implementation of the present project, therefore, led to a shifting of the median. Another reason for shifting the median was the asymmetric condition of the road. It is further pointed out that the location of a toll plaza was not selected arbitrarily. The placement and positioning of a toll plaza depends on the topography of land, geometrical alignment of the road, super elevation, the strata and general land conditions in the vicinity of the toll plaza etc. Another factor is the design of the toll plaza that includes the lane width, platform size, lanes and slip lengths etc. The selection of the present site was neither arbitrary nor irrational. The location of the toll plaza was shifted on 16.10.2003 from KM 41.012 to KM 41.712 i.e within KM 42, as the plaza ended 400 meters short of KM 42.000. The earlier location was close to a curve in KM 41 which gave a curvilinear view and was accident prone, as the toll plaza appeared to be farther than it actually was. On 3.5.2004, the location was moved from KM 41.712 to 41.490 as the plaza was extended beyond KM 42 which was beyond the scope of the concessionaire agreement. It is further submitted that the lane area is 101.8 meters and does not include the requirement of land to develop curbs, embankments, slopes, drainage and plan for services/utilities. The Toll Plaza has to provide two slow free lanes which add to the width of the toll plaza services/utilities, sale office, parking area on each side with separate zones for cars and heavy vehicles, water supply, fencing, power supply, toilets, police and guard room, generator room, toll plaza supporting room, as C.W.P No. 11461 of 2005 ::13:: detailed in Schedule C. It is further contended that as the site of the toll plaza was selected after due consideration, which included the possibility of locating it at a distance from the petitioners' property and detailed surveys by experts were conducted, the petitioners' contention that the toll plaza was intentionally located opposite their buildings, is devoid of any truth. The additional affidavit, filed by the respondents, sets out in detail the reasons that lead to shifting of the toll plaza. It is a mere coincidence that the petitioners' building is situated opposite the toll plaza. A part of the petitioners' building falls within the utilities/services to be developed for the toll plaza and would, therefore, have to be demolished. The other part of the building would be used to house the toll plaza building. In response to the assertion that the petitioner's building ( in CWP No.11461 of 2005) is 55,000 sq. feet, whereas the concessionaire requires a smaller building, it is submitted that the entire matter has been considered by the concessionaire, as also by technical experts and, therefore, does not call for interference. Even otherwise, the concessionaire has to eventually transfer the building to the National Highway Authority, after 20 years, in accordance with the agreement. As regards the plea of vires, it is submitted that there is no absolute rule, whether constitutional or legal that requires all acquisitions to follow the procedure, prescribed by the Land Acquisition Act. Parliament or a State Legislature may and do, in the exercise of their powers, prescribe different procedures for different types of acquisitions, dependent upon the nature of acquisition. In the present case, though the procedure for acquisition is a departure from the procedure, prescribed under the Land C.W.P No. 11461 of 2005 ::14:: Acquisition Act, but this alone would not render the provisions of the Act ultra vires. It is further argued that reference of any dispute as to the amount of compensation payable, to an Arbitrator under the Arbitration and Conciliation Act, 1996 would speed up the process of determining compensation. The procedure under the Land Acquisition Act, is by its very nature, fraught with delays. Parliament, therefore, in its wisdom, and in the exercise of its powers, decided to prescribe a different procedure for hearing and deciding objections, doing away with the cumbersome procedure of repeated objections, notices, hearings etc. It is further submitted that the offer of compensation to a landowner may not be titled as an award but is in essence no different. The fact that the applicability of the Land Acquisition Act has been specifically excluded is indicative of a clear and unequivocal legislative intent to depart from the procedure under the Land Acquisition Act. It is further argued that the absence of a right to appeal as provided under the Land Acquisition Act, does not render the Amending Act illegal. An appeal is a creation of a statute, absence thereof would not attract the charge of an arbitrary or illegal exercise of legislative power. It is further submitted that the right to raise objections has been confined to the user of the land so as to prevent unnecessary and illogical objections with respect to the acquisition. It is further argued that reference of the dispute with respect to compensation to an Arbitrator, in accordance with the provisions of the Arbitration and Conciliation Act, 1996, has been provided so as to shorten the procedure for determination of compensation and the absence of an agreement is immaterial. As regards the absence of any provision in the statute for payment of solatium and interest, counsel for the Union of India submits C.W.P No. 11461 of 2005 ::15:: that the special nature and