Case: Ceat Limited (Formerly Known As Ceat Tyres of India Limited) Vs. The State of Maharashtra and 5 Others

no doubt be necessary for determining the compensation payable for the interest outstanding in the claimants but that would not make it the subject of acquisition. 21. In the instant case, the Government has not transferred the title of the acquired land in favour of the Petitioner, but has only allotted the land to the Petitioner for setting up a tyre manufacturing factory. In normal circumstances, the Government could not have unilaterally resumed the land which was required for public purpose without invoking provisions of Land Acquisition Act and paying compensation to the Petitioner for the interest held by him or rights created in his favour in respect of such land. However the obligation on the part of the Government to acquire the land by invoking the provisions of Land Acquisition Act has been obviated by the Petitioner by accepting the terms and conditions set out in Clause 5 of the Sanad, which reads thus:- If at any time or times the whole or any part of the said lands is required by Government for the purpose of making any new public road or for any purpose connected with public health, safety, utility or necessity (as to which matter the Company shall accept as final the decision of Government) the Company on being thereunto required by the Government in writing shall transfer to the Government the whole or part of the said land as the Government shall specify to be necessary for any of the aforesaid purposes and in consideration of such transfer Government shall pay to the Company a sum equal to the amount of compensation awarded under the said Act and paid by the Company in respect of land so transferred including the percentage awarded under Section 23(2) of the said Act, together with such amount as shall be estimated by the Executive Engineer, Presidency Division, whose decision in the matter shall be final as to the costs of the development of the land so transferred which shall include the value at the date of transfer of any structures standing thereon and when part of building lies on the land so transferred and part is on the adjoining land reasonable compensation for the injurious affection of the part of the building on the adjoining land. 22. A plain reading of this Clause clearly indicates that when the land or any part thereof is required for public purpose, the PetitionerCompany, on being called upon by the Government in writing, is bound to transfer such land to the Government. In consideration of such transfer the Government is liable to pay to the PetitionerCompany a sum equal to the amount of compensation awarded under the said Act and paid by the Company in respect of land so transferred including the percentage awarded under Section 23(2) of the said Act together with costs of development, value of any strucvture and other components specified in clause 5 of the Sanad and as estimated by the Executive Engineer. The Petitioner-Company having accepted the allotment of the land under the Sanad is bound by the terms and conditions stipulated in the Sanad. The law in this regard is well settled. A reference in this regard can be made to the decision of the Apex Court in New Bihar Biri Leaves Company and Ors. vs. State of Bihar and Ors.(1981) 1 SCC 537 wherein it is observed thus:- 48. It is a fundamental principle of general application that if a person of his own accord, accepts a contract on certain terms and works out the contract, he cannot be allowed to adhere to and abide by some of the terms of the contract which proved advantageous to him and repudiate the other terms of the same contract which might be disadvantageous to him. The maxim is qui approbat non reprobat, (one who approbates cannot reprobate). This principle, though originally borrowed from Scots Law, is now firmly embodied in English Common Law. According to it, a party to an instrument or transaction cannot take advantage of one part of a document or transaction and reject the rest. That is to say, no party can accept and reject the same instrument or transaction (Per Scrutton L.J. Verschures Creameries, Ltd. v. Hull & Netherlands Steamship Co.; See Douglas Menzies v. Umphelby; See also Strouds Judicial Dictionary, Vol. I, page 169, 3rd Edn.). 23. In the instant case, the Petitioner-Company having voluntarily accepted the terms and conditions of the allotment as stipulated in Sanad, the State Government is not liable to acquire the land or pay the compensation to the Petitioner-Company under the provisions of the Right to Fair Compensation Act. In our considered view, issuance of writ of mandamus would result in permitting the Petitioner-Company to wriggle out of its obligation under Clause 5 of the Sanad. Suffice it to say, the writ of mandamus cannot be issued to avoid obligation under the contract. Hence the writ of mandamus as prayed for cannot be issued. 24. It is to be noted that the Petitioner-Company has already surrendered the possession of the land admeasuring 357.9 sq.meters from CTS No.354 under possession receipt dated 30.06.2006, copy of which is annexed to the Petition at Exhibit-I. The Government was therefore bound to pay to the Petitioner-Company compensation as stipulated in clause 5 of the Sanad. It is not in dispute that the Government has not paid the compensation in respect of the said land under the premise that the Petitioner-Company had not raised its claim for compensation. Clause 5 of the Sanad does not necessitate raising of such claim but cast an obligation on the Government to quantify the compensation as stipulated therein. The Government was therefore not justified in not paying the compensation. Be that as it may, in the affidavit-in-reply, the Deputy Collector has stated that the Petitioner-Company can file an application for compensation in accordance with clause 5 of the Sanad with the office of the Respondent No.5 and that the same will be considered in accordance with law.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]11. We have perused the record and considered the rival submissions advanced by the learned Counsel for the respective parties. It is not in dispute that the Petitioner-Company had applied to the erstwhile Government to allot land for setting up a tyre manufacturing unit at Bhandup. Pursuant to two separate agreements dated 15.10.1958 and 17.01.1969 entered with the Petitioner-Company, the Government acquired the land and upon payment of compensation under the Award, allotted the acquired land to the Petitioner-Company under Sanads dated 29.12.1969 and 23.6.1975. The Sanads state that the lands have been vested in the Petitioner-Company subject to the provisions of the Maharashtra Land Revenue Code. The Petitioner-Company has sought to construe the term vested as transfer of ownership15. The aforesaid pronouncements make it clear that vesting does not necessarily connote vesting in title but also includes vesting of interest, vesting in possession or vesting of right to enjoy the property, etc. Since the word vest is of ambiguous import and has no fixed connotation, it would be necessary to refer to the relevant terms and conditions of the Sanad to understand the meaning of the word and the context in which it is used18. A plain reading of the terms and conditions of the Sanad clearly indicate that the Government had acquired the land under the Land Acquisition Act and vested the same in favour of the Petitioner Company in accordance with the provisions of Maharashtra Land Revenue Code. The allotment of the land to the Petitioner-Company was for a specific purpose of setting up a tyre manufacturing unit. The Sanad restricts the user of the land and restrains the PetitionerCompany from dealing with the property or using the same for any other purpose without prior permission of the Government. The Government has also imposed absolute restrain on alienation of the land or any part thereof in any manner without prior permission of the Government. This restriction in particular clearly indicates that the Government had not vested absolute title in favour of the Petitioner-Company but had conferred on the Petitioner-Company the status of Class-II occupant. In terms of Section 2(23) r/w. Section 29 of Maharashtra Land Revenue Code, the occupant Class II is only a holder in actual possession of unalienated land in perpetuity subject to restrictions on right to transfer. The status of a Class II occupant cannot be equated with that of a owner. Hence, we are not inclined to accept the submissions of the learned Counsel for the PetitionerCompany that the Petitioner-Company is the absolute owner of the acquired land21. In the instant case, the Government has not transferred the title of the acquired land in favour of the Petitioner, but has only allotted the land to the Petitioner for setting up a tyre manufacturing factory. In normal circumstances, the Government could not have unilaterally resumed the land which was required for public purpose without invoking provisions of Land Acquisition Act and paying compensation to the Petitioner for the interest held by him or rights created in his favour in respect of such land. However the obligation on the part of the Government to acquire the land by invoking the provisions of Land Acquisition Act has been obviated by the Petitioner by accepting the terms and conditions set out in Clause 5 of the Sanad22. A plain reading of this Clause clearly indicates that when the land or any part thereof is required for public purpose, the PetitionerCompany, on being called upon by the Government in writing, is bound to transfer such land to the Government. In consideration of such transfer the Government is liable to pay to the PetitionerCompany a sum equal to the amount of compensation awarded under the said Act and paid by the Company in respect of land so transferred including the percentage awarded under Section 23(2) of the said Act together with costs of development, value of any strucvture and other components specified in clause 5 of the Sanad and as estimated by the Executive Engineer. The Petitioner-Company having accepted the allotment of the land under the Sanad is bound by the terms and conditions stipulated in the Sanad. The law in this regard is well settled23. In the instant case, the Petitioner-Company having voluntarily accepted the terms and conditions of the allotment as stipulated in Sanad, the State Government is not liable to acquire the land or pay the compensation to the Petitioner-Company under the provisions of the Right to Fair Compensation Act. In our considered view, issuance of writ of mandamus would result in permitting the Petitioner-Company to wriggle out of its obligation under Clause 5 of the Sanad. Suffice it to say, the writ of mandamus cannot be issued to avoid obligation under the contract. Hence the writ of mandamus as prayed for cannot be issued24. It is to be noted that the Petitioner-Company has already surrendered the possession of the land admeasuring 357.9 sq.meters from CTS No.354 under possession receipt dated 30.06.2006, copy of which is annexed to the Petition at Exhibit-I. The Government was therefore bound to pay to the Petitioner-Company compensation as stipulated in clause 5 of the Sanad. It is not in dispute that the Government has not paid the compensation in respect of the said land under the premise that the Petitioner-Company had not raised its claim for compensation. Clause 5 of the Sanad does not necessitate raising of such claim but cast an obligation on the Government to quantify the compensation as stipulated therein. The Government was therefore not justified in not paying the compensation. Be that as it may, in the affidavit-in-reply, the Deputy Collector has stated that the Petitioner-Company can file an application for compensation in accordance with clause 5 of the Sanad with the office of the Respondent No.5 and that the same will be considered in accordance with law.