1 IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE APPELLATE APPELLATE SIDE SIDE SIDE WRIT WRIT WRIT PETITION NO. 510 OF 1991 PETITION NO. 510 OF 1991 PETITION NO. 510 OF 1991 WITH WITH WITH WRIT WRIT WRIT PETITION NO. 6423 OF 1996 PETITION NO. 6423 OF 1996 PETITION NO. 6423 OF 1996 WRIT PETITION NO. 510 OF 1991 Zahir Jahangir Vakil & Ors. .. Petitioners vs. Pune Municipal Corporation & Anr. .. Respondents Shri Mohan Pungalia for the petitioners. Shri R.G. Ketkar for Respondent No.1 Shri Pradip Patil, AGP., for Respondent No. 2 WRIT PETITION NO. 6423 OF 1996 Shri Ramchandra Purushottam Shirole & Ors. .... Petitioners. vs. Pune Municipal Corporation & Ors. .. Respondents 2 Shri V.P. Sawant for the Petitioners Shri R.G. Ketkar for Respondents 1 & 2. CORAM CORAM CORAM : A.P.SHAH, & : A.P.SHAH, & : A.P.SHAH, & S.U.KAMDAR, S.U.KAMDAR, S.U.KAMDAR, JJ. JJ. JJ. DATE DATE DATE : 23rd December, 2004. : 23rd December, 2004. : 23rd December, 2004. ORAL RAL RAL JUDGMENT : (Per S.U. Kamdar, J.) JUDGMENT : (Per S.U. Kamdar, J.) JUDGMENT : (Per S.U. Kamdar, J.) . These two writ petitions raise a common question of law pertaining to the interpretation of section 126 of the Maharashtra Regional and Town Planning Act, 1966, particularly in context of the town planning scheme framed thereunder. Since both these petitions are raising a common question of law, we decided to dispose of the same by a common judgment. Facts in Writ Petition No. 510 of 1991. 2. Under the provisions of the Bombay Town Planning Act, 1954 which has since been repealed, a declaration was made on 28.11.1958 declaring 3 intention to prepare development plan for the city of Pune. The draft development plan was thereafter submitted to the Government for its sanction. . In 1965, the petitioners purchased the land bearing survey nos. 209/1, 209/2 and, 209/3 totally admeasuring about 10 acres and 35 gunthas equivalent to 4 Hecters and 21 Ares. The said land was situated at Yeravada Town, Nagar Road, within the district of Pune. A sale deed in favour of the petitioner for the said land was executed and registered on 30.3.1970. On 15.8.1966, the draft development plan prepared under the then provisions of the Bombay Town Planning Act, 1954 was sanctioned. Under the said sanctioned plan the plot of land bearing survey no. 209 of an area admeasuring about 8732.90 sq.mtrs forming part of District Yerawada was earmarked for a High School. 3. On 11.01.1967, the provisions of the Bombay Town Planning Act, 1954 were repealed and a new Act known as Maharashtra Regional and Town Planning Act, 1966 (hereinafter referred to as the said Act) has been enacted and brought in force. The 4 repealing provisions under section 165 of the said Act inter alia provided that notwithstanding the repeal of the provisions of the Bombay Town Planning Act, 1954 anything done or any action taken (including any declaration of intention to make a development plan or town planning scheme, any draft development plan or scheme published by a local authority) shall be saved and shall be deemed to have been done or taken under the corresponding provisions of the said Act. . On 10.9.1982, original sanctioned development plan which was for a period of 10 years, expired. However, no steps were taken by the planning authority to acquire the said land of the petitioners for the reservation of High School which was provided for under the said development plan. On 18.9.1982, a draft revised development plan was published and the said land was continued to be reserved thereunder now for primary school. . On 10.6.1985, the petitioner served a purchase notice under section 127 of the said Act calling upon the respondents to either acquire the said 5 land by an agreement or delete the reservation from the development plan. It was stated in the said notice that inspite of a period of 18 years having been expired from the sanctioned plan neither the said land is acquired nor the petitioner is permitted to develop the same. On 16.09.1985, the Planning Authority replied to the petitioners inter alia stating therein that the land cannot be released under section 127 of the said Act because the ownership of the land is already vested with the State Government and, therefore, no action can be initiated under the provisions of the said Act. On 5.1.1987, a revised development plan was published once again inter alia indicating the designated use of the said property for primary school from Sector I to VI in accordance with the decision of the Pune Municipal Corporation. On 02.02.1988, the petitioner made a proposal to the Planning Authority to construct primary school at their own costs and permit them to develop the balance land for commercial/residential purposes. On 29.9.1988, the petitioner once again repeated their proposal to the Urban Development Department of the Government of Maharashtra. However, they 6 were directed to contact the Pune Municipal Corporation. On 21.11.1988, the Planning Authority i.e. the Pune Municipal Corporation informed the petitioners that they will continue the reservation of the land and will not permit the petitioners to develop the same. In view of an unsuccessful attempt to get the said land released for development the petitioners filed the present petition inter alia seeking relief from this Court that the plot of the petitioners should be released from the said reservation and/or in the alternative the petitioners should be permitted to develop the said plot of land for construction of the primary school in accordance with the reservation. 4. There are certain facts which are not set out in necessary details in the present petition and which are crucial for the determination of the present case, are briefly enumerated hereunder. 5. In respect of the said survey nos. 209/1/, 209/2 and 209/3 which was the original plot of the petitioners herein, a town planning scheme was prepared known as Town Planning Scheme Yeravada No. 7 I. A draft town planning scheme was published under the provisions of section 61 of the said Act. An arbitrator was appointed to determine the rights of the parties whose plots were covered under the scheme. In fact, the petitioners participated before the said arbitrator for determination of their holding and/or payment of betterment charges and/or compensation to the petitioners. On 14.8.1974 the petitioners were heard by the Arbitrator and after hearing, the arbitrator has passed his award. Under the said Award, the said original plots of land bearing survey No. 209/1/, 209/2/ and 209/3 were merged and was given a revised plot number. Out of the said revised plot no. 77 two plots are carved out namely final plot no. 75 and 76. The said final plot no. 75 is reserved for high school under the Town Planning Scheme No. I Yerawada and the final plot no. 76 of an area admeasuring about 3 hectors 96.28 Ares was allotted to the petitioner in substitution of his original plot of land. . The said scheme has been sanctioned by the Government on 22.4.1983 and sanction was published 8 in Maharashtra Government Gazette on 9.6.1983. The said scheme has been brought into effect with effect from 15.7.1983. Under the said scheme, an award has been published by the arbitrator inter alia indicating that the original plot no. 77 of the petitioner was substituted by allotment of the final plot no. 76. The original area of the land holding of the petitioner of 4 hectors, 41 ares has been reduced to the area of 3 hectors 96.26 ares. After taking into consideration the betterment charges and the compensation payable to the petitioner for reduction in the area (which reduction is due to reservation of the final plot no. 75 for primary school) the arbitrator has awarded that there is payable by the petitioner to the Pune Municipal Corporation a sum of Rs. 61,812/- The arbitrator while computing the aforesaid figure has taken the market value of the original plot of land and the market value of final plot of land as undeveloped as well as developed respectively and after computing the compensation payable to the petitioner for the loss of area has arrived at the aforesaid figures. 9 . An appeal was preferred by the petitioners to the Appellate Tribunal which was constituted under the Civil Judge Senior Division, Pune who has by his order dated 10.11.1976 rejected the appeal of the petitioners herein. 6. The respondent Corporation has filed an affidavit and has inter alia pointed out that the petitioner had appeared before the Arbitrator and after hearing him, the computation has been carried out. In the said affidavit the basis of determination of the market value of the land of original plot of land and final plot of land is also set out. It is further contended that the petitioner has not disclosed the aforesaid developmenmts which are important for the adjudication of thepresent petition. Lastly the affidavit states that in view of sanction of the town planning scheme thesaid land is vested in the government without any encumberances and thus the present petition is without any merits. . The petitioners have in the aforesaid background of the facts claimed that the provisions of section 10 126 applies to the land earmarked or reserved for any public purpose either under the Development plan and/or under a town planning scheme. Once the said section applies then in that event the said land cannot be acquired for any public purpose without payment of compensation as contemplated under the Land Acquisition Act, 1894 read with section 126 (3) of M.R.T.P. Act, 1966. Facts in Writ Petition No.6423 of 1996. 7. In 1922 a draft scheme was published for an area known as Shivaji Nagar of District Pune. The said scheme was varied in 1934. 8. In 1961, the Corporation as a Special Planning Authority decided to take over the land for construction of two parallel roads, namely, the roads connecting Modal Colony area to Pune University Road. On 29.7.1961 a notification was issued under section 4 of the Land Acquisition Act 1894 for acquiring one out of the two plots of land required for parallel roads. It is the case of the petitioner that the said acquisition was resorted 11 to because of the owners of the said portion of the land refused to deliver the possession of the property voluntarily to the Corporation for the purposes of construction of the said road. The said portion of the land was urgently required to be earmarked. Since some of the newly formed plot had no accesses. In 1963, the owner of the land bearing city survey no. 1111 of Shivaji Nagar which is the subject matter of the present petition handed over possession of the said land to the Corporation for construction of the road under the town planning scheme. The portion of the land which was handed over was admeasuring about 6991 sq. ft. Sometime in or about 1967 the provisions of the said MRTP Act, 1966 were introduced and brought into effect by replacing the earlier provisions of law known as Bombay Town Planning Act, 1954. . In respect of the said area of the land ultimately a Town Planning Scheme was finalised and on 13.4.1992 an arbitrator passed an award providing for part of the land of the petitioner to be reserved for the road. In 1979, the said Town 12 Planning Scheme No. I was varied. Ultimately, in the finalised Scheme a merger of final plot no. 485 D/1 into final Plot No. 486 was provided for. . On 24.4.1995, Pune Municipal Corporation refused an application for grant of FSI for an area of 6991 sq.ft. which was surrendered for the construction of the road under the said Town Planning Scheme. The petitioner thereafter moved an application to the State Government under Section 448 of the Bombay Provincial Municipalities Act, 1949 read with Section 157 of the said Act, inter alia seeking prayers that the Pune Municipal Corporation be directed to execute suitable agreement in accordance with the provisions of Section 157 of the of the said Act and allow the petitioner an additional FSI of an area of 6991 sq. ft. which was taken over for the construction of the road. The said application came to be rejected by an order dated 9.4.1996 in which it has been inter alia stated that the land which was forming part of the final plot in the town planning scheme has been taken into consideration while fixing the compensation/betterment charges under the 13 provisions of the said scheme and, therefore, the petitioner is not entitled to any further compensation either in terms of the money or in terms of grant of additional FSI as claimed by the petitioner herein. It is this order of 9.4.1996 which is the subject matter of challenge in this writ petition. RIVAL CONTENTIONS 9. Both the learned counsel have before us strenously argued that the petitioners are entitled to the compensation for loss of land under the town planning scheme by virtue of the provisions of section 126 of the said Act. It has been contended by the learned counsels appearing for the parties that the properties which are lost in reorganisation of the plot under the Town Planning Scheme cannot be taken over by the State or the Planning Authority being the Pune Municipal Corporation free of cost. It has been urged that such a provision would be confiscatory in nature and would be violative of the petitioners fundamental rights as also cannot stand scrutiny of 14 rule of law. It was urged that it is a settled law that no person could be deprived of his property without giving any compensation whatsoever under the provisions of the Act and such a provision would be ultra vires. On the basis of the aforesaid argument, we are called upon to interpret provisions of section 126 of the said Act to hold that in fact for the loss of property in reorganisation of the plot under the Town Planning Scheme, the State Government is bound to acquire the same by following procedure prescribed under Section 126 of the said Act. It was thus contended that it is only this interpretation that would save such confiscatory legislation by which the rights of the petitioners in the property are sought to be extinguished without payment of any money whatsoever. 10. It has been further argued by the learned counsel on behalf of both the petitioners that the words contained under section 126 of the Town Planning Act includes even those cases where the land is reserved under the Town Planning Act and once the words ’town planning schemes’ are 15 incorporated under the provisions of Section 126 of the said Act then it is incumbent upon the Government under section 126 (2) and (3) of the said Act to follow the provisions of Land Acquisition Act from the stage of section 6 declaration. Alternatively, it has been contended by the learned counsel for the petitioner that if we hold that the provisions of section 126 have no application in so far as the Town Planning Schemes are concerned, then in that event, it will result in arbitrary and/or discriminatory conclusions in as much as under the Town Planning Act, 1966 itself where land is reserved for any of the public purposes under the development plan, such a person will be entitled to benefits of sub-section (2) of Section 126 and consequently the benefits conferred under the Land Acquisition Act which inter alia includes the claim for solatium, interest and other compensation whereas a person whose land is reserved for public purpose under the Town Planning Scheme will be deprived of such benefits by virtue of those acquisition not being incorporated under the provisions of section 126. It has been thus urged before us that such would be an arbitrary and 16 discriminatory treatment to the two different persons similarly situated and such an interpretation of section 126 would make it vulnerable to challenge under section 14 of the Constitution of India. Thus, we were once again called upon by the learned counsel for the petitioner to interpret section 126 in a manner which saves its constitutional validity rather than make the same vulnerable to constitutional challenge. The learned counsel therefore respectfully submitted that though there can be a provision of reservation and/or compensation under the Town Planning Scheme of any portion of the land by the State Government still, for the purposes of compensation, the State Government would be duty bound to follow the procedure prescribed under section 126 (2) of the said Act and cannot avoid his obligation to pay compensation as prescribed under the Land Acquisition Act by virtue of sub section (2) of Section 126 of the said Act. The learned counsel appearing in Writ Petition No. 6423 of 1996 has further contended that in view of the fact that the petitioner is entitled to compensation for the loss of land for road widening 17 under the Town Planning Scheme and the Development Control Regulations for the City of Pune, permit grant of FSI in lieu of such compensation, the respondents should be directed to give the petitioner the FSI in lieu of compensation or loss of area in road widening under the Town Planning Scheme. Thus, he contended that he is entitled to the benefits of the FSI which have been wrongfully rejected by the State Government under the impugned order. 12. It was further contended by both the learned counsels for the petitioner that the vesting provided under section 88 (a) of the said Act of 1966 on final scheme being sanctioned by the State Government would be subject to the computation of compensation as contemplated under section 126 (2) and 3 of the said Act. In other words, it was contended by the learned counsel for the petitioner that there was no absolute vesting of the land under section 88 (a) of the said Act but such vesting provided thereunder is a conditional vesting on payment of compensation as contemplated under the provisions of section 126 (2) and (3) of 18 the Act of 1966. It was further contended that the absolute vesting will arise only when a computation of the compensation payable under section 126 (2) and (3) of the said Act of 1966 is made and paid over to the petitioner in pursuance of the acquisition of their land under the Town Planning Scheme. 13. On the other hand, the learned counsel for the respondent Corporation has contended that the Town Planning Scheme is a scheme by itself and for the purpose of compensation there is an inbuilt mechanism within the provisions of the framing of the same scheme. He, therefore, contended that for an area acquired or loss of area under the scheme the petitioners are not entitled for compensation under section 126 of the said Act and, therefore, the question of resorting to Land Acquisition Act by relying upon section 126 (2) of the said Act cannot and does not arise. The learned counsel for the respondent has further contended that the scheme having been sanctioned by the State Government has become final and the properties which are forming part of the said Scheme in terms 19 of the said scheme vests in the State Government. He, therefore, contended that once there is a vesting in favour of the State Government then the land is vested free of all encumbrances and the title of the petitioner in the said land is divested. He, therefore, contended that the contentions raised by the petitioner that the said property is being acquired as a confiscatory measure is not true and correct argument. He contended that in fact the provisions of the said Act which permits the finalisation of the Town Planning Scheme provides for an inbuilt computation of the market value of the land lost by the plot holders after giving the set off towards the betterment charges in respect of the plot allotted to them. After giving the aforesaid set-off the balance is arrived at as payable or receivable by the Pune Municipal Corporation and, therefore, he contended that the argument of the learned counsel for the petitioners that the said legislation would tantamount to be a confiscatory legislation has no substance and thus urged us to reject the same. . The learned counsel appearing in Writ Petition 20 No. 6423 of 1996 has advanced an additional argument in support of his petition that in his case there is a discrimination by and between the two plot holders under the said Town Planning Scheme as in respect of the same plot holder under the scheme the acquisition is resorted to under the provisions of the Land Acquisition Act and compensation computed and paid over whereas in the case of the petitioner the land is not acquired under the Land Acquisition Act but the said land is sought to be acquired under the provisions of the Town Planning Scheme. It was thus contended by the learned counsel for the petitioner in the said petition No. 6423 of 1996 that there cannot be two modes of acquisition for acquiring the property under the said scheme. It was contended that by virtue of the said discriminatory provisions some of the persons are more benefited by resorting to Land Acquisition Act whereas the others are not so benefited by virtue of providing for compensation within the sanctioned Town Planning Scheme. It was thus urged by the learned counsel for the petitioners that the said action on the part of the respondent Corporation to treat two plot holders 21 differently is arbitrary and consequently the action of acquisition of the petitioners property under the Town Planning Scheme is liable to be quashed and set aside. 14. The learned counsel appearing in the other writ petition being Writ Petition No. 510 of 1991 has further contended that as and by way of additional argument that in his case there was reservation on the plot of land for the primary school as far back as 1967. He has thereafter contended that the said reservation was continued even in the subsequently revised development plan whereas in the case of a town planning scheme the reservation prescribed and/or appearing has been in respect of the primary school and partly for other purposes. Thus, the learned counsel has contended on behalf of the petitioner in the said writ petition that by virtue of the reservation being contained under the development plan, the State Government and/or the respondent Corporation were bound and liable to acquire the said property in accordance with the reservation provided under the development plan and consequently resorting to the 22 provisions of section 126 of the said Act of 1966. He, therefore, contended that the acquisition sought to be effected by virtue of the revision in the town planning scheme is illegal and unlawful. It is further contended that the acquisition by method of town planning scheme in disregard to the provisions of section 126 of the said Act, 1966 is illegal and unlawful and, therefore, he contended that the said acquisition proceedings be quashed and set aside. 15. Before dealing with the rival submissions between the parties and the authorities relied upon in support of the aforesaid contentions, it has become necessary to set out certain provisions of the said Act which require interpretation in the present petition. LEGAL PROVISIONS 16. Section 2 (9) defines the development plan. Sections 30 and 31 provide for a draft development plan and sanction to the draft development plan. 23 "2(9) "Development plan" means a plan for the development or re-development of the area within the jurisdiction of a Planning Authority and includes revision of a development plan and proposal of a special planning Authority for development of