Case: M/S.Larsen &amp; Toubro Ltd Vs. State Of Gujarat

In all these matters, different notifications under Section 4 of the Act were issued as it appeared to the State Government that lands specified in these notifications which were under challenge in these matters were likely to be needed for the purpose of a housing colony of the L& Ltd. "which was engaged in Engineering Manufactures Industries which was for a public purpose". All the lands are situated in village Mandalla, Taluk Choryasi, District Surat. In SCA 1568/1987 acquisition was set aside on the ground that there was no compliance with the provisions of Rules 3 and 4 of the Land Acquisition (Companies) Rules, 1963 (`Rules for short). In SCA 5149/89 acquisition was set aside not only on the ground of non-compliance with the Rules 3 and 4 of the Rules but also that petitioners therein were not served with notice under Section 9 of the Act before passing of the award. In SCA 5171 High Court held that the decision of the State Government for withdrawal from acquisition under Section 48 of the Act was neither illegal nor ultra vires though the same would be enforceable only on the issuing of notification under Section 48 of the Act. In this case, High Court also held that actual physical possession of the land had not been delivered to the acquiring body L& Ltd. Against the order passed in SCA 1568/87 both L& Ltd. and the State Government have filed special leave petition Nos. 11957/97 and 12986/97 respectively. Against the order in SCA 5149/89 again both L& Ltd. and the State Government have filed special leave petitions respectively bearing Nos. 11900/97 and 14637/97. Against the order in SCA 5171/91 it is only the L& Ltd. who is aggrieved and has filed special leave petitions No. 11778/97. In this State Government is supporting its action for withdrawal from acquisition.Under the Act, land can be acquired for a company as well. "Company" means a company as defined in Section 3 ofthe Companies Act, 1956. Petitioner is such a company. Under Section 4 of the Act whenever it appears to the appropriate Government that land in any locality is needed or is likely to be needed for any public purpose or for a company, a notification to that effect shall be published and a public notice also to be given in the said locality. under Section 5-A any person interested in any land notified under Section 4 can object to the acquisition of the land or of any land in the locality, as the case may be. Procedure is prescribed as to how objections are to be heard by the Collector and his naking the report to th e Government. Under Section 6 when the appropriate Government is satisfied after considering the report, if any, made under Section 5-A that any land is needed for a public purpose, or for a company, a declaration shall be made to the effect. Part VII of the ACT deals with acquisition of land for companies. Under Section 39 falling in Part VII, the provisions of Section 6 to 16 and Sections 18 to 37 shall not be put in force in order to acquire land for any Company unless with the previous consent of the appropriate Government and not unless the Company shall have executed the agreement as prescribed. Under Section 40 an enquiry is to be made before the appropriate Government consents to acquisition of land for the CompanyIn first special leave petition No 12986/97, land situated in Survey No 40, Village Mandalla, Taluk Choryasi in district Surat was subject matter of acquisition. M/s Mangal Park Cooperative Housing Society, respondent No. 1 challenged the action of the State Government in acquiring the land by issuing notification and declaration under Sections 4 and 6 of the Act on the g round that it acted "without any authority of law and in purported exercise of the powers conferred upon it by committing fraud on the statute and by the colourable exercise of the said power and also without application of mind". First respondent, therefore, sought quashing of the notification under Section 4 and declaration under Section 6 of the Act. In whole body of the petition before the High Court it was never stated that provisions of rule 3 had been contravened. It was submitted that provisions of Sections 4 to 37 of the Act could not be put into operation to acquire land for a company unless with the previous consent of the State Government nor before the company had executed an agreement as mentioned in Section 41 of the Act. It was then submitted that in this case neither the consent of the State Government was obtained nor the company seemed to have executed agreement as provided in Section 37 read with section 41 of the Act before issuance of the notification under Section 4 and declaration under Section 6 of the Act. Rule 4 was quoted and with reference to it was contended that statutory requirements contained in the said rule had not been fulfilled before issuance of the impugned notification and declaration and also that L& Ltd. made no efforts to purchase land by negotiation nor the competent authority had help any enquiry as contemplated by Rule 4. It was also alleged that under Section 42 the agreement entered into, if any, between the State Government and L& Ltd. was required to be published in the official gazette and that no such agreement to the knowledge of the petitioner was published in any gazette. In the counter affidavits filed in the High Court both L& Ltd. and State Government denied the allegations so made by the petitioner, the first respondent herein.In the absence of any allegation that Rule 3 had not been complied and there being no particulars in respect of non-compliance of Rule 4 also, it is difficult to see as to how the High Court could have reached the finding that statutory requirements contained in these Rules were not fulfilled before issuance of notification under Section 4 and declaration under Section 6 of the Act. High Court did not give any reason as to how it reached the conclusion that Rules 3 and 4 had not been complied in the face of the record of the case. Rather, it returned a finding which is unsustainable that it was "no t possible on the basis of the material on record to hold that there was compliance with the rules 3 and 4". In the affidavit filed by Mr. S.M. Vankar, Under Secretary, Government of Gujarat, Department of Revenue it was stated that as per the requirement of Rule 3 a Committee had been constituted by the State Government which consisted of (1) Secretary, Revenue Department (Land Acquisition), (2) Joint Commissioner of Industries, (3) Deputy Secretary, Agricultural Department (4) past M .L.A., (5) Member and (6) President of Zila Panchayat. In this affidavit it was also stated that the Assistant Collector, Surat prepared a detailed report which he submitted to the Collector and placed before the aforesaid Committee. Deputy Secretary, who was Ex-Officio Member Secretary of the Committee addressed a letter to all the members in this connection and along with that letter he circulated a note in connection with the acquisition of the land in question. President of the District Panchayat and a Member of the Committee also submitted a separate report to the Deputy Secretary, Revenue Department. The Committee thereafter met and discussed the matter and recommended acquisition of land for L& Ltd. to the Government. In this view of the matter it is difficult to understand as to how the High Court said that there was no compliance with Rule 3 by the State Government when as a matter of fact, as noted above, there was no mention of non-compliance with Rule 3 in whole body of the writ petition.

Court's reasoning:
High Court, in our opinion, failed to take note of the affidavit of Mr. Y.S. Trivedi, Senior Manager, L& Ltd. and that of Mr. R.S. Bohora, Manager of the L& Ltd. giving details and placing on record documents to show compliance with the requirements of Rule 4. We do not think it is necessary for us to set out in any detail as to how requirements of Rule 4 have been complied when in presence of the relevant record it was difficult for the respondent to contend otherwise. It was conceded that there was no specific averment relating to rule 3. Even otherwise, we find that stipulations contained in Rule 3 were fully observed. As regards non-compliance of Rule 4 it was submitted that there was no independent report of the collector. That is also not correct. It is not necessary for the Collector personally to examine all the details himself. He can certainly call for the report from the Assistant Collector as the circumstances of a case may demand and act on the same. As a matter of fact only two contentions had been raised by the petitioners before the High Court and that were that the land belonging to a cooperative housing society which itself was a public purpose could not be subject to acquisition and that Rule 4 had not been complied. There were, however, no particulars stated in the petition as to how it could be so said. It is not enough to allege that a particular rule or any provision has not been complied. It is a requirement of good pleading to give details, i.e., particulars as to why it is alleged that there is non-compliance with a statutory requirement. Ordinarily, no notice can be taken on such an allegation which is devoid any particular. No issue can be raised on a plea foundation of which is lacking. Even where Rule Nisi is issued, it is not always for the department to justify its action when the Court finds that a plea has been advanced without any sub stance, though ordinarily department may have to place its full cards before the Court. In the present case, however, we find that the State has more than justified its stand that there has been compliance not only with rule 4 but with Rule 3 as well, though there was no challenge to rule 3 and the averments regarding non- compliance with Rule 4 were sketchy and without any particulars whatsoever, High Court was, therefore, not right in quashing the acquisition proceedings in SCA 1568/87High Court, in our opinion, has not correctly analysed the two judgments of this Court in Balmokand Khatri Educational and Industrial Trust, Amritsar vs. State of Punjab and Balwant Narayan Bhagde vs. M.D. Bhagwat and Ors. to come to the conclusion that actual physic al possession of the land was not taken over by the State.In Balwant Narayan Bhagde vs. M.D. Bhagwat &Ors, 1 SCC 700  ], a three Judge Bench of this Court was considering the question of taking possession of the acquire d land under the ActThis Court has repeatedly held that writ petition challenging the notifications issued under Section 4 and 6 of the Act is liable to be dismissed on the ground of delay and laches if challenge is not made within a reasonable time. This Court has said that the petitioner cannot sit on the fence and allow the State to complete the acquisition proceedings on the basis that notification under Section 4 and the declaration under Section 6 were valid and then to attack the notifications on the grounds which were available to him at the time when these were published as otherwise it would be putting premium on dilatory tactics. Writ petition (SCA 5149/89) is thus barred by laches as well.Special leave petition No 11778/97 arises out SCA No. 5171/91 which was filed by the L& Ltd. in the High Court. In the writ petition L& Ltd. had prayed for quashing of the action of the State Government in withdrawing land under survey Nos. 39, 41/2 and 44/2 of village Magdalla from acquisition under Section 48(1) of the Act of which acquisition was for the purpose of housing colon y for L& Ltd. and sought a direction to the State Government and Special Land Acquisition Officer, respondents 1 and 2 herein, to complete the acquisition proceedings after notifications under Section 4 and under Section 6 which had be en issued. There are as many as 13 respondents in this appeal, respondents 3 to 13 being the persons whose land the State Government has withdrawn from acquisition under Section 48 of the Act. Appellant admits that in respect of lands comprising in survey Nos. 39 and 44.2 possession had not been taken. However, its contention is that possession of land comprised in Survey No. 41/2 was taken and on that account also any action under section 48(1) of the Act would be bad in law. The fact t hat possession of land in the writ petition and Survey No. 41/2 was in fact taken has strenuously denied by not only the private respondents but also by the State Government. It is admitted that though there is an order of the State Government withdrawing from acquisition on notification has yet been issued in the official gazette and on that ground also appellant submits there could not be any valid withdrawal from acquisition and any action of the respondents in pursuance to that very decision of State Government to withdraw from acquisition would be illegalIn respect of certain portions of land comprised in Survey No. 41/2, subject matter of SCA 5149/89 (SLP 11900/97), we have already held that L& Ltd. was put in possession. Any action under Section 48 of the Act to that extent of land is bad in lawM r. Naik said it was also wrong for the High Court to observe that the land which was proposed to be withdrawn from acquisition was in reality not needed by the appellant and on that account withdrawal from acquisition would not have seriously prejudiced the appellant in the implementation of its housing scheme for its employees and that "nothing of that sort has been taken place in this case". Mr. Naik said has per the report of the Surat Urban Development Authority all the lands which were subject matter of acquisition in all the three writ petitions measured 29 acres which satisfied only 45% need for housing of the employees of the L& Ltd. he said the observations of the High Court were entirely against the record. Mr. Naik appears to be right in his submissions . High Court has not properly considered the need of the appellant. it was only after all the enquiries as required under the Act and the Rules has been made that action to acquire land for housing scheme of the employees of the appellant was takenIt was thus contended that when statute did not require to issue any notification for withdrawal from the acquisition, reference to Section 21 of the General Clauses Act was not correctMr. Salve said that Section 21 expressly referred to the powers being given to issue notifications etc. under an Act o r Regulations and under this that poser included power to withdraw or rescind any notification in the similar fashion. It was therefore submitted that when Section 48 did not empower the State Government to issue any notification and it could not be read into that provision that withdrawal had to be issued by a notification. His argument, therefore, appeared to be that on correct interpretation of Section 21 of the General Clauses Act before reaching the stage of Section 48, the St ate Government could withdraw notifications under Sections 4 and 6 of the Act by issuing notification withdrawing or rescinding earlier notifications and that would be the end to the acquisition proceedings. We do not think that Mr. Salve is quite right in his submissions. When Sections 4 and 6 notifications are issued, much has been done towards the acquisition process and that process cannot be reversed merely be rescinding those notification. Rather it is Section 48 under which, after withdrawal from acquisition is made, compensation due for any damage suffered by the owner during the course of acquisition proceedings is determine and given to him. it is, therefore, implicit that withdrawal from acquisition has to be notifiedPrinciples of law are, therefore, well settled. A notification in the Official Gazette is required to be issued if the State Government decides to withdraw from the acquisition under Section 48 of the Act of any land of which possession has not been taken. An owner need not be given any notice of the intention of the State Government to withdraw from the acquisition and the State Government is at liberty to do so. Rights of the owner are well protected by sub-sect ion (2) of Section 48 of the Act and if he suffered any damage in consequence of the acquisition proceedings, he is to be compensated and sub-section (3) of Section 48 provides as to how such compensation is to be determined. There is, therefore , no difficulty when it is the owner whose land is withdrawn from acquisition is concerned. However, in the case a company, opportunity has to be given to it top show cause against any order which the State Government proposes to make withdrawing from the acquisition. Reasons for this are not far to seek. After notification under Section 4 is issued, when it appears to the State Government that the land in any locality is needed for a company, any person interested in such land which has been notified can file objections under Section 5-A(1) of the Act. Such objections are to be made to the collector in writing and who after giving the objector an opportunity of being heard and after hearing of such objections and after making such further enquiry, if any, as the Collector thinks necessary, is to make a report to the State Government for its decision. Then the decision of the State Government on the objections is final. Before the applicability of other provisions in the process of acquisition, in the case of company, previous consent of the State Government is required under Section 39 of the Act nor unless the company shall have executed the agreement as provided in Section 41 of the Act. Before giving such consent, Section 40 contemplates a previous enquiry. then compliance with Rules 3 and 4 of the Land Acquisition (Company) Rules, 1963 is mandatarily required. After the stage of Section 40 and 41 is reached, the agreement so entered into by the company with the State Government is to be published in the Official Gazette, This is Section 42 of the Act which provides that the agreement on its publication would have the same effect as if it had formed part of the Act. After having done all this, State Government cannot unilaterally and without notice to the company withdraw from acquisition. Opportunity has to be given to the company to show cause against the proposed action of the State Government top withdraw from acquisition. A declaration under Section 6 of the Act is made by notification only after formalities under part VII of the Act which contains Section 39 to 42 have been complied and report of the Collector under Section 5-A(2) of the Ac t is before the State Government who consents to acquire the land on its satisfaction that it is needed for the company. A valuable right, thus, accrues to the company to oppose the proposed decision of the State government withdrawing from acquisition. The State Government may have sound reasons to withdraw from acquisition but those must be made known to the company which may have equally sound reasons or perhaps more which might persuade the State Government to reverse its decision withdrawing from acquisition. In this view of the matter it has to be held that Yadi (Memo) dated 11.4.91 and Yadi (Memo) dated 3.5.91 were issued without notice to the appellant (L& Ltd.) and are, thus, not legal.