Case: Himalayan Tiles &amp; Marbles (P) Ltd Vs. Francis Victor Coutinho (Dead) By Lrs &amp; Ors

2. The facts of the case lie within a narrow compass and may be briefly summarised as follows :3. The appellant was a private company which was carrying on the business of manufacture and sale of artificial marbles and tiles and other accessories at village Majas Mogra, Jogeshwari, East Bombay. The company was spread over about 10 acres of land. Sometime in 1957 or 1958 the company moved the government for acquiring additional land for purposes of the company. Accordingly, on January 7, 1958, the government issued a notification under Section 4 ofthe Land Acquisition Act, 1894 (hereinafter referred to as the Act) which was followed by a separate notice by the Land Acquisition Officer acquiring the land in dispute. This was followed by another notification under Section 6 of the Act which was served on the respondent on January 25, 1960. In pursuance of these notifications the acquisition proceedings went on which culminated in an award made under Section 12 of the Act on April 11, 1961, which was published in the State Gazette on April 18, 1961. On December 11, 1961, a letter was written on behalf of the government informing the owner of the acquired land that possession would be taken on or about January 12, 1962. The purpose of the acquisition, as mentioned in the notification, was public purposes for which the land is needed for Himalayan Tiles and Marble (Pvt.) Ltd. The first respondent in the writ petition filed in the High Court before a Single Judge prayed that the entire land acquisition proceedings should be quashed because the land was not acquired for any public purpose as contemplated by Section 4 of the Act. It was contended before the Single Judge that the government was not competent to a acquire the land for purposes of a private company which could not be said to be a public purpose under Section 4 of the Act. The plea taken by the first respondent found favour with the Single Judge who allowed the writ petition and quashed the land acquisition proceedings along with the notifications mentioned above4. Thereafter, the appellant filed and appeal before the Letters Patent Bench which confirmed the view taken by the Single Judge and dismissed the appeal mainly on the ground that the appointment had no locus standi to file the appeal before the Bench inasmuch as it was not a person interested within the meaning of Section 18(1) of the Act.

Court's reasoning:
8. It seems to us that the definition of a person interested given in Section 18 is an inclusive and must be liberally construed so as to embrace all persons who may be directly or indirectly interested either in the title to the land or in the quantum of compensation. In the instant case, it is not disputed that the lands were actually acquired for the purpose of the company and once the land vested in the government, after acquisition, it stood transferred to the company under the agreement entered into between the company and the government. Thus, it cannot be said that the company had no claim or title to the land at all. Secondly, since under the agreement the company had to pay the compensation, it was most certainly interested in seeing that a proper quantum of compensation was fixed so that the company may not have to pay a very heavy amount of money. For this purpose, the company could undoubtedly appear and adduce evidence on the question of the quantum of compensation14. Thus, the preponderance of judicial opinion seems to favour the view that the definition of person interested must be liberally construed so as to include a body, local authority, or a company for whose benefit the land is acquired and who is bound under an agreement to pay the compensation. In our opinion, this view accords with the principals of equity, justice and good conscience. How can it be said that a person for whose benefit the land is acquired and who is to pay the compensation is not a person interested even though its stake may be extremely vital ? For instance, the land in acquisition proceedings may be held to be invalid and thus a person concerned is completely deprived of the benefit which is proposed to be given to him. Similarly, if such a person is not heard by the Collector or a court, he may have to pay a very heavy compensation which, in case he is allowed to appear before a court, he could have satisfied it that the compensation was for too heavy having regard to the nature and extent of the land. We are, therefore, unable to agree with the view taken by the Orissa High Court or even by the Calcutta High Court that a company, local authority or a person for whose benefit the land is acquired is not an interested person. We are satisfied that such a person is vitally interested both in the title to the property as also in the compensation to be paid therefor because both these factors concern its future course of action and if decided against him, seriously prejudice his rights. Moreover, in view of the decision of this Court referred to above, we hold that the appellant was undoubtedly a person interested as contemplated by Section 18(1) of the Act. The High Court, therefore, committed an error in throwing out the appeal of the appellant on the ground that it had no locus to file an appeal before the Bench17. We are, however, satisfied that in the instant case the first condition adumbrated by this Court, viz., that there must be a complete acquisition before Section 7 could validate the same, has not been fulfilled at all. In this view of the matter we need not go into the other conditions indicated by this Court22. Admittedly, the appellant did not appear before the Single Judge in the writ petition filed by the respondents and the petition was contested only by the State. Perhaps the appellant may have thought that as its interests were fully safeguarded by the government it was not necessary for it at that stage to appear before the High Court. Even so, the pleas of both the parties taken together clearly show that the entire possession of the property did not pass to the government and thus no title vested in the government despite the notification acquiring the land. In these circumstances, therefore, it is unmistakably clear that the properties not having vested in the government the acquisition was not complete and its invalidity could not be cured by Section 7 of the amendment Act as pointed out by this Court in the case referred to above. On this ground alone the appellant must fail. Dr. Chitale however, suggested that out of 2.2 acres, possession of one acre may have been taken by the government. Assuming that to be so, until the possession of the entire land acquired was taken by the government, the acquisition could not be a complete acquisition so as to attract the operation of Section 7 of the amending Act. In this view of the matter, we are satisfied that the appellant has failed to prove that one of the essential conditions for application of Section 7 of the amending Act, which would cure the infirmities from which the acquisition proceedings suffer, has been fulfilledIn this connection, the Division Bench observed as follows :On the question of possession being delivered to the government the petitioners specifically averred at the end of paragraph 15 of the petition : "The petitioners further say that notwithstanding the said letter and the threat therein contained the petitioners are still in possession of the said lands and their tenants are occupying the said structures standing thereon and possession thereof has not been taken by the respondents". They made similar averments at the end of paragraph 1 of the petition, that "the petitioners were at all times and still are in possession of the said immovable properties"22. Admittedly, the appellant did not appear before the Single Judge in the writ petition filed by the respondents and the petition was contested only by the State. Perhaps the appellant may have thought that as its interests were fully safeguarded by the government it was not necessary for it at that stage to appear before the High Court. Even so, the pleas of both the parties taken together clearly show that the entire possession of the property did not pass to the government and thus no title vested in the government despite the notification acquiring the land. In these circumstances, therefore, it is unmistakably clear that the properties not having vested in the government the acquisition was not complete and its invalidity could not be cured by Section 7 of the amendment Act as pointed out by this Court in the case referred to above. On this ground alone the appellant must fail. Dr. Chitale however, suggested that out of 2.2 acres, possession of one acre may have been taken by the government. Assuming that to be so, until the possession of the entire land acquired was taken by the government, the acquisition could not be a complete acquisition so as to attract the operation of Section 7 of the amending Act. In this view of the matter, we are satisfied that the appellant has failed to prove that one of the essential conditions for application of Section 7 of the amending Act, which would cure the infirmities from which the acquisition proceedings suffer, has been