PETITIONER RESPONDENTS a. Ehotelal Jaiswal S/ o Baigaram Jaiswal Aged about 6O years R/o At post Singhitarai, Tahsil 85 Thana — Dabhra District — Janjgir—Champa (CG) VERSI IS State of Chhattisgarh Through the Secretary, Department of Industries, Government of Chhattisgarh D.K.S. Bhawan, Mantralaya Raipur (CG) Managing Director, Chhattisgarh State Industrial Development Corporation (CSIDC) Jeevam Bhima Parisar, Pandri Raipur (CG) Director, Directorate of Industries, 2nd Floor, Life Insurance Corporation commercial premises, Raipur (CG) Chief Secretary-cum-convenor, State Industrial Promotion Board, Government of Chhattisgarh, Rajpur (CG) 4. 5./ Collector, Janjgir, Distt. Janjgir-Champa (CG) 6. ”/y Land Acquisition Officer-cum- Sub-Divisional Officer, Dabhra Distt. Janjgir-Champa (CG) K 7. Commissmner, . . B11aspur . D1v1510n . . . Distt. Bilaspur (CG) 8. K Tahsildar, Dabhra, Distt. Janjgir-Champa (CG) 9K General Manager District Industries 85 Trade Centre, Janjgir~Champa, Old Nagar Palika Building, Champa, Distt. Janjgir-Champa (CG) 10.’ Union of India, Through the Secretary, Ministry of Environment and Forest, Shastri Bhawan, New Delhi ~v- .M. 1 1. Regional Officer, Regional Office, Environment Conservation Board, Near Deendayal Park, Vyapahar Vihar, Bilaspur (CG) w 12. M/ s Athena Chhattisgarh Power Pvt. Ltd., (2x600 MW Coal based g Thermal Power Project at Village W‘WX‘W W ‘ Nimohi Singhitarai, in Dabhra Benipaii, Tahsil, Orekera 8:; Janjgir-Champa) 4”;# a» ‘ Q m xmv “ Having its office at — Infront of Carmel School, Govind Garden, Near Guru Building, Laxmipur, Raigarh, Distt. Raigarh (CG) OF INDIA \3 M RIT PETITION UNDER ARTICLE 226 OF THE CONSTITUTION w, ,7 W HIGH COURT OF CHHATTISGARH, BILASPUR Single Bench : Hon’ble Shri Sunil Kumar Sinha, J. Writ Petjtion (C) No. 1075 of 2011 Khileshwar Prasad Jaiswal Vs. State of Chhattisgarh & Others & (Connected W.P.(C) Nos. 1506; 1562; 1658 & 5295 of 2011) Judgment Post for Judgment: j1/10/2011 Sdl- SUNIL KUMAR SINHA Judge HIGH COURT OF CHHATTISGARH, BILASPUR Writ Petition (C) No. 1075 of 2011 PETITIONER Khileshwar Prasad Jaiswal Versus RESPONDENTS State of Chhattisgarh & 9 Others Writ Petition (C) No. 1506 of 2011 PETITIONERS Sarju Prasad Dansena & 4 Others Versus RESPONDENTS State of Chhattisgarh & 8 Others Writ Petition (C) No. 1562 of 2011 PETITIONER Chotelal Jaiswal Versus RESPONDENTS State of Chhattisgarh & 11 Others Writ Petition (C) No. 18 of 2011 65 PETITIONERS Natwar Singh & 1 Another Versus RESPONDENTS State of Chhattisgarh & 11 Others And 2 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 of2011 Writ Petition (C) No. 5295 of 2011 PETITIONERS Bhagat Ram & ‘12 Others Versus RESPONDENTS State of Chhattisgarh & 11 Others (Writ Petitions under Article 226 of the Constitution of India) Appearance: Mr. Sanjay Kumar, Mr. Shashank Thakur & Mr. Manoj Jaiswal, Advocates for the respective petitioners. Mr. Kishore Bhaduri, Additional Advocate General with Mr. Satish Gupta, Govt. Advocate for State of Chhattisgarh and Authorities of the State. Mr. P.S. Koshy & Mr. Kasif Shakeel, Advocates for Chhattisgarh State Industrial Development Corporation. Mr. Sachin Singh Rajput, Advocate for Union of india. Mr. V.V.S. Murthy, Sr. Advocate with Mr. Pankaj Shrivastava, Advocate for Chhattisgarh Environment Conservation Board. Mr. Challa Kodanda Ram & Dr. N.K. Shukla, Sr. Advocates with Mr. K.V. Shiva Prasad, Mr. Shailendra Shukla & Mr. Ravindra Nath Reddy, Advocates for M/s Athena Chhattisgarh Power Pvt. Ltd. JUDGMENT (11.10.2011) Following judgment of the Court was delivered by Sunil Kumar Sinha, J. (1) Since common questions of facts and law are involved in these writ petitions, l have heard them together, and they‘are being disposed of by this common judgment. 3 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 of2011 (2) The acquisition of 392.99 acres of land situated at village Singhitarai, PC No. 01, Tehsil Dabhra, District Janjgir-Champ'a (C.G.), belonging to the petitioners and other agriculturists vide Land Acquisition Case No. 04/A/82/2009-10, has been chaiienged in these writ petitions. The petitioners have prayed for quashing of the notifications issued u/ss 4 & 6 of the Land Acquisition Act, 1894 (hereinafter referred to as the ‘L.A. Act’) and have also prayed for quashing the award dated 22.2.2011. s (3) Collector, Janjgir-Champa issued a notification u/s 4 (1) of the L.A. Act on 1.6.2010 for acquisition of private lands situated at village Singhitarai, Tehsil Dabhra, District Janjgir—Champa (C.G.). The land owners/villagers, whose lands were proposed to be acquired, filed detail objections jointly before the Sub—Divisional Officer — Cum — Land Acquisition Ofncer, Dabhra on 30.6.2010 in above Land Acquisition Case No. 04/A/82/2009-10. The General Manager District lndustries & Trade Centre filed reply before the Land Acquisition Officer. The Land Acquisition Officer recorded statements of villagers/land owners on 31.7.2010. The Land Acquisition Officer after hearing objections of the parties decided the same u/s 5-A and rejected those objections. Thereafter the matter was forwarded to the Collector for further proceedings u/s 6. The ColleCtor issued notification u/s 6 of the L.A. Act on 15.9.2010. On 4.10.2010 objections were filed and after compliance of Section 9 of 4 0J§ Writ Petition (C) Nos. 1075; 1506'. 1562: 1658 & 5295 of 201 1‘ the Act, award was passed on 22.2.2011 which was further approved by the Commissioner on 24.2.201 1. (4) Learned counsel for the petitioners have contended that the iands have been acquired by the Government at the instance of M/s Athena Chhattisgarh Power Pvt. Ltd. (hereinafter referred to as the ‘respondent—Company’) and as such the procedure prescribed under Part Vll of the L.A. Act was to be complied with; the entire money for compensation has been contributed by Company and the acquisition being at the behest of the Company was not for public purpose. They have also contended that the notification issued u/s 4(1) of the L.A. Act was vague as there was no description of khasra numbers in the said notification and the same,thus was non est, therefore, the entire proceeding of Land Acquisition vitlates. (5) Per contra, learned counsel for the respondents have contended that the State Government has acquired the lands for public purpose; the compensation is being paid from the public fund; the acquired lands were agreed to be given on lease to the respondent—Company in terms of the notified policy of the Government after collection of necessary lease premium and service charges; the Government, under the industrial policy, had acquired the lands and handed over to Chhattisgarh State lndustrial Development Corporation (CSIDC) and CSIDC in turn as a lesser has executed a lease deed in favour of respondent-Company; the 5 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 of 2011 said transaction of lease is subject to certain rights to enjoy the land on certain conditions by the Company for specific purpose and there is no transfer of the ownership of the lands in favour of the respondent-Company; the ownership of the lands continue with the Government/CSIDC; and thus, the acquisition was not for the Company. The acquisition was made by the Government to facilitate the establishment of a 2 x 600 MW Thermal Power Project at the cost of Rs.6200.00 crores and keeping in view the benefits arising out of the Projects, at best it can be said that the land acquisition proceedings were for public purpose falling squirrelly within the scope of Section 3 (f) of the L.A. Act. They have contended that the Government has acted under industrial Policies 2004-2009 and 2009-2014 and has taken the Thermal Power Plant as core sector industry and acquired the lands for above public purpose. About the contents of notification u/s 4 (1), learned counsel for the respondents have contended that the description in the notification was sufficient to identify the lands; the petitioners had full knowledge about proposed acquisition of their lands as they have participated in the proceedings of Section 5; the petitioners have belatedly challenged the validity of above notification; the contents of the notification have not at all prejudiced the rights of the petitioners for want of knowledge. They have further contended that the petitioners have not made any allegations of malafide, therefore, the above ground raised by the petitioners cannot succeed. 6 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 of2011 (6) i have heard Iearned counsel for the parties at length and have also perused the records of the writ petitions. (7) Firstly, i shali consider as to whether the acquisition was malafide and in colorable exercise of power to give undue benefit to the respondent—Company; there was no public purpose, and whether it was required to be undertaken in conformity with the provisions of Part VII of the L.A. Act ? (8) There are two lndustriai Policies of the State. One 2004-2009 policy and the other 2009-2014 policy. According to the first policy, Clause 4.2.3, the State Government took a decision that development of private industrial areas will be encouraged. Further by Clause 4.2.8 it was decided that for setting up industries particularly large and mega industrial units, outside the industrial areas and parks, government revenue land and private land will be acquired and made available to investors through Chhattisgarh State Industrial Development Corporation. Vide Clause 4.4.4, on the basis of size of investment, industries were classified in the following four categories:- (i) Small scale industries —- As defined by the Government of India from time to time; (ii) Medium-Large industries — Industries with total capital investment up to Rs.100 crore except the small scale industries; 7 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 of2011 (iii) (iV) Mega projects -— Large industries with total capital investment between Rs.100 crore and Rs.1000 crore; and Very large industries with total capital investment of over Rs.1000 crore. The Government further decided vide Clause 4.5.3 that private sector participation in infrastructure building will be encouraged, particularly in the following areas:- Basic infrastructure like roads, power, water supply, housing; lndustrial infrastructure such as development of industrial areas and parks, cluster development; Logistics infrastructure like air-cargo complex, inland container depot, ware housing, logistics hub;and Social infrastructure like health, education, tourism. (i) 5 (ii) (iii) (iV) The definitions of “Medium/Large Industrial Unit" and “Mega Project" are mentioned in Annexure—1 to the policy. According to the definition, “Mega Project" means an industrial unit, which has fixed capital investment of more than Rupees 100 crore, has obtained, as the case may be, industrial entrepreneur memorandum certificate, industrial license or letter of intent from Government of India and holds a production certificate issued by State's Directorate of Industries. In the said policy Annexure-2 is the negative list of industries units ineligible for exemption/concession which consist of 33 industries, but the power or power generation has not been a, ,g. 8 Writ Petition (C) Nos. 1075: 1506; 1562: 1658 & 5295 of 2011 included in Annexure-2 negative Iist. Annexure-4 to the policy provides for exemption/concession for promotion of industrial investment and among the various exemptions, exemption from payment of stamp duty has also been provided vide Clause 4 of Anexure—4. The second policy i.e. Industrial Policy 2009-2014, which came into existence on 13‘ November, 2009, is further more elaborate’ Strategy vide Clause 3.6 shows the intention of the Government to empower the industrial development at district as well as state‘level for facilitating large scale land acquisition for making provisions for reserved plot and for establishing in new area industrial state. For industrial infrastructure the Government has further decided vide Clause 4.2.3 for facilitating the acquisition of the land for industrial purpose and safeguarding the interests of land owning families. Specific facilities such as stamp fee for purchasing agricultural land up to the amount of compensation and priority in establishing industry in industrial areas was also decided to be provided. lt was further decided that it shall be the priority of the government to give compensation to the land acquisition affected families. ln case of land acquisition/direct purchase of land for industrial purpose, such provisions shall be made as the land owner could get suitable compensation. The Government further decided that for the purpose of industrial investment incentive, the State shall be categorized into economically developing and economically backward areas and for the purpose of volume of investment, the industries would be classified in the following five categories:- (it 9 Writ Petition_(_C) Nos. 1075; 1506; 1562; 1658 & 5295 of2011 1) Micro and small industries (2) Medium industries ( (3) Large industries ) Mega projects and (5) Ultra-mega projects In the second policy, core sector industries have also been defined and classified in Annexure-5 and a Thermal Power Plant has been taken as a core sector industry. List of economicaHy developing areas for industrial investment encouragement is also annexed to this policy and block-Dabhra of District Janjgir-Champa, where the proposed power plant is to be established is one of such areas. (9) In background of the above two policies, the private respondent/M/s Athena Chhattisgarh Power Pvt. Ltd. filed an application on 29‘“ October, 2008 before the State Investment Promotion Board (for short ‘SIPB') to initiate the process of land acquisition. The company made a request for 895.45 acres private land and 75.47 acres of Government land. The SIPB, forwarded the proposal of the company to the Commissioner Industries vide memo dated 24.11.2008 which contains the details of lands of different villages total amounting to 895.45 acres of private lands and 75.47 acres of Government lands. A village-wise detail contained in forwarding memo of SIPB is as follows:- E‘ W E51 flTFl m Pratt wit (m 1i) W inn (w rt) 1. Wan—3‘ Witt—am 405.53 37.71 10 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 0f2011 \/‘ The present petitions are in relation to the lands falling in village Singhitarai in Which the company had prayed for allotment of 37.71 acres of Government land also in addition to the 405.53 acres of private land. lt is on the above proposal for allotment of the lands to the private respondent on their application in the prescribed manner, the appropriate authority of the Government issued a notification u/s 4 (1) of the L.A. Act on 1.6.2010. In the meanwhile an amount of advance premium of Rs.79.91 crores was deposited by the company with the CSIDC for the said lands. Prior to all this a memorandum of understanding (MOU) was entered into between the State Government and the private respondent on 7m January, 2008 which provided that the Government , through the SIPB will facilitate expeditious grant of permission, approval, No-Objection Certificate, for recommendation etc. under the purview of the State Government and the company shall be responsible to obtain all statutory clearance, approvals relating to foreign Direct Investment (FDI), if any, as per law. Further on 15‘ August 2009 the implementation agreement was also entered into and MOU dated 2. W WW411m 294.54 21.29 3. W WWW ‘ aw 172.26 4.39 4. 7W WWW—a'”m1 13.56 11.18 5. mm CW41in 9.56 0.90 11111 895.45 75.47 11 \(V W Writ Petitipn (C) Nos. 1075_'1_1 506; 1562; 1658 & 5195 of2011 7.1.2008 was released thereby. Clause 4.2.3 of implementation agreement is important for the purpose of deciding the point raised. This Clause deals with acquisition and transfer of lands. lt provides that the Company shall at its own cost and expense, identify the land required for the Project and the Government will assist in acquisition of private lands as may be required by the Company for construction, operation and maintenance of the Project (acquired Land). The Company shall also be allowed to acquire such land n through direct‘negotiations with the owners inaccordance with the prevailing laws, rules and regulations in the State. In case the land is owned by the Government, it will be leased out to the Company as per the Applicable Laws and policies. However, all the preliminary work to effect such lease shall be done by the Company at its own cost. The State has come with a definite return. lt has contended that the acquisition is already over and award has been passed and after passing of the award the compensation amount is being distributed to the land oustees and about 16 crores have already been distributed to more than 114 land oustees till the date of filing of the return i.e. 2nd May 2011. The State has also contended that the possession of the entire subject lands has been taken by the State and the State became the owner of the lands on account of acquisition. The State has further contended in Para-19 of the return that after passing of the award the lands have vested in the State and ownership of the land is transferred from the land oustees to the State Government, and even in future, the State will 12 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 of2011 remain the owner of the lands acquired. However, the lands which are acquired and shall remain under the ownership of the State, may be allotted/leased out to the industrial units which deserve it as per the State lndustriai Poiicy. (2)19 (10) Learned counsel for the petitioners have argued that since entire amount of compensation appears to have been contributed by the private respondent, therefore, it was an acquisition for the private respondent and the procedure laid down under Part Vll of the L.A. Act was to be followed. They have strongly relied on the decision of this Court in Gaukaran Singh —Vs- State of C.G. & Others‘ 2008 (32 C.G.L.J. 163. They have also referred to various other decisions which are mentioned in the above judgment of this Court. (11) In Gaukaran Singh (supra), the land was proposed to be a acquired for Lafarge lndia Pvt. Limited who wanted to establish a rail link between their Sonadih plant and Nipaniya railway station at their oWn expenses. When a notification u/s 4 (1) of the L.A. Act was issued, it was challenged before the High Court on the following grounds which are contained in Para-6 of the judgment:- o the acquisition proceeding is for construction of private railway line for the respondent company at their own cost; 9 the acquisition proceeding has been initiated without following the Land Acquisition (Companies) Rules, 1963 (for short ‘Rules, 1963’); 13 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 0f2011 - The purpcse for which the Iand is proposed to be acquired is not a public purpose within the meaning of Section 3 (f) of the Land Acquisition Act, 1894 (for short ‘Act, 1894’), as it is for the construction of rail siding of a private company; . the impugned notification has been issued by the Collector, who is not a competent authority to issue notification under Section 4 of the Act, 1894; o notification under Section 4 (1) of the Act, 1894 is also illegal and bad in law for want of particulars of the land to be acquired and also for not mentioning the public purpose for which. the acquisition is proposed. The co-ordinate Bench of this Court, relying on two decisions namely Pandit Jhandu Lal and others —Vs- The State of Puniab and another, AIR 1961 SC 343 and Pratibha Nema and others — Vs- State of M.P. and others, (2003) 10 SCC 626, held vide Para 26 as under:- “26. In the instant case, also construction of rail link from railway siding to the factory premises at the request of a private company at its own expenses can by no stretch of imagination fall within the well accepted meaning of ‘public purpose’. Therefore, in the considered opinion of this Court the acquisition proceeding in the instant case would be governed by Part-Vll and not by Part-ll of the Act, 1894." 14 M9 Writ Petition (C) NQS. 1075; 1506; 1562; 1658 & 5295 Of 2011 (12) The judgment of this Court was mainly based on the observations made by the Supreme Court in Pratibha Nema (supra) vide Para 22 that:— “22. Thus the distinction between public purpose acquisition and Part VII acquisition has got blurred under the impact ofjudicial interpretation of relevant provisions. The main and perhaps the decisive distinction lies in the fact whether the cost of acquisition comes out of public funds wholly or partly. Here again, even a token on nominal contribution by the Government was held to be sufficient compliance with the second proviso to Section 6 as held in a catena of decisions. The net result is that by contributing even a trifling sum, the character and pattern of acquisition could be changed by the Government. In ultimate analysis, what is considered to be an acquisition for facilitating the setting up of an industry in the private sector could get imbued with the character of public purpose acquisition if only the Government comes forward to sanction the payment of a nominal sum towards compensation ? In the present state of law, that seems to be the real position.” A.” (13) The above judgment is distinguishable on facts. In the said case, the company wanted to construct a private rail line on their own cost. The judgment is on the premises that no cost at all was to be paid by the Government and thus, no public purpose appears to be there. In the present case there are no allegations that the entire amount of compensation whatever has accrued till date and what will accrue in future all shall be deposited by company and the 15 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 0f2011 Government will do nothing. Secondly since it was challenged at the stage of issuance of notice u/s 4 (1), therefore, though there are many distinguishable facts in the said case and in the present case but this Court was having no occasion to address on those issues which i shall take up later on. (14) In Prem Bai —Vs- The State of M.P. and others, AIR 1976 Madhya Pradesh 35, a Division Bench of M.P. High Court held that when the State Government after acquiring lands for establishing industries gives them to a company for setting up a factory and the responsibility for paying compensation is with the State Government it is clear that the ownership of the lands is with the State Government and the company is only a lessee. Therefore, the acquisition cannot be challenged on the ground of non-compliance with Part Vll of the L.A. Act. (1 5) In Gaianand and others —Vs- State of M.P. and others, AIR 2000 Madhya Pradesh 2, it was held that “Where a land was acquired for setting up a ‘diamond park’ and the land was to be vested in Govt. and transferred to M.P. Audyogik Kendra Vikas Nigam for allotment to prospective entrepreneurs, and a private Company applied for setting up of such unit, the acquisition cannot be challenged on ground that it was colourable exercise of power with a view to benefit the private Company". This judgment came for consideration before the Supreme Court in Pratibha Nema (supra). 16 Writ Petition (C) Nos. 1075; 1506; 1562; 1658 & 5295 of 2011 The observations made in Pratibha Nema, Para-22, have been quoted in Gaukaran Singh (supra). Over and above, in Pratibha Nema, the Supreme Court held vide Para-25 that “It seems to be fairly clear, as contended by the learned counsel for the appellants, that the amount paid by the Company was utilized towards payment of a part of interim compensation amount determined by the Land Acquisition Officer on 7-6~1996 and in the absence of this amount, the Nigam was not having sufficient cash balance to make such payment. We“ may even go to the extent of inferring that in all probability, the Nigam would have advised or persuaded the Company to make advance payment towards lease amount as per the terms of the MOU on a rough—and-ready basis, so that the said amount could be utilized by the Nigam for making payment on account of interim compensation. Therefore, it could have been within the contemplation of both the parties that the amount paid by the Company will go towards the discharge of the obligation of the Nigam to make payment towards interim compensation. Even then, it does not in any way support the appellants’ stand