Case: Union of India Vs. District Judge, Udhampur

This appeal arises form a case which had a chequered career. The appellant addressed a letter on February 8, 1968 to the Dy. Commissioner, Udhampur, State of Jammu and Kashmir enquiring about the availability of the land for extension of Air Field, Udhampur. The Addl. Secretary, Govt. of Jammu and Kashmir, wrote a letter to the Ministry of Defence that 2027 Kanals and 18 Marlas of land was available for acquisition at an approximate cost of Rs. 12,62,655.32 paise subject to normal rise or decrease in that amount, which may occur on the determination of the market value. The Govt. had agreed and accorded sanction on July 27, 1970 for a sum of Rs. 13,34,056/for acquisition of the land. Thereafter the Govt. of Jammu and Kashmir issued notification under section 21 on December 16, 1971 requisitioning 2134 Kanals of the said land situated in village and tehsil Udhampur. A notification under section 7 of the requisition and Acquisition of Immovable Property Act 35, 1968 of Jammu and Kashmir (for short `the Act) was published in S.R.O. No. 843 dated December 16, 1972. Thereafter exercising the power under section 16 of the Act the Dy. Commissioner, Udhampur was appointed as a competent authority under the Act. He determined market value @ Rs. 5,100/per Kanal for Class `A lands in all the villages, Rs. 4,500/for Class `B land in all the villages and Rs. 4,800/per Kanal for Class `C in all the villages. In addition he awarded 15% solatium and interest at 4% from December 16, 1972 to June 25, 1973, the date on which possession was taken. The compensation had come to about Rs.A letter was issued to the subordinate officers for their approval. Since the appellants had not approved the determination of the market value at the said rate, they sought a reference under section 8 of the Act. The District Judge was appointed as an arbitrator under section 8(1)(b). At the beginning of the enquiry proceedings, held by the District Judge to determine the market value, the respondents filed an objection before the arbitrary contending that the award passed by the competent authority was an offer and it was acceptable to the. Since the requisition and acquisition had been made by the competent authority for and on behave of the appellants they had no right to object to the award made by the competent authority. Therefore, the enquiry to be held by the District Judge as Arbitrator was without jurisdiction. But when the enquiry of the Arbitrator proceeded, without deciding the respondents, objections, they filed a writ petition in 1975. The learned single Judge in his order dated February 22, 1979 held that the award passed by the competent authority being an offer, when the respondents had accepted that offer, it must be deemed to be one made under Rule 9 read with section 8(1)(a) of the Act. Therefore, the appellants had no right to object to the offer made by the competent authority. Accordingly he directed the competent authority to enter into an agreement with the respondents in Form `K. Dissatisfied with that order the appellant filed L.P.A. No. 35/79. The Division Bench, by its order dated April 27, 1983 while upholding the view of the Single Judge that the award of the competent authority was an offer and that the appellants were bound by the offer, set aside the direction given to enter into an agreement in Form `K instead directed the District Judge to decide the objection filed by the appellants. Thereafter, the District Judge overruled the objections and held that the respondents had accepted the offer. Though no direct finding was recorded that the offer became enforceable in consequence of rejecting the reference under section 8(1)(b), it must be concluded that the appellants were bound by the offer made by the competent authority and it would be one enforceable under section 8(1)(a) of the Act. The appellants filed W.P. No. 295/84 and the Division Bench by its order dated May 8, 1985 while affirming the view of the single Judge and the Division Bench in the order passed by the District Judge is valid and the locus standi of the appellants to file the writ petition was doubted accepting the stand taken by the respondents that the appellants were not the persons interested under section 2(d0 of the Act and dismissed the writ petition. Thus this appeal by special leave.

Court's reasoning:
4. In this case, the compensation was fixed with the association of the local officers of the appellant. The contention that the appellants have no locus standi is equally no longer res integra. In addition he also contends that for the second limb of Rule 9(1) i.e. the approval of the Govt. in the administrative department, it is only of the State Govt. of Jammu and Kashmir or an officer authorised by the State Govt. in that behalf. Since the competent authority having been authorised in the notification, there is no need of further authorisation or the approval needed in this behalf and that, therefore, the award made by the competent authority is only an offer as held by the High Court in the previous litigation. It binds the appellants and that, therefore, they cannot question the offer made by the competent authority. We find no force in the contention. The language of Rule 9(1), namely, the delegated authority shall "as far as may be associated with itself the local officer of the Govt. concerned with the property in fixing compensation" would necessarily mean that the local officer of the Govt. of India that is apparent when we read the language closely with the language used in S. 21 of the Act. Section 21 expressly postulates that when the requisition is sought on behalf of the Union of India, the Govt. of Jammu and Kashmir acts under S. 21 requisitioning the land for the public purposes of the Union of India. Admittedly when the notification under S. 21 was issued requisitioning the land for defence purpose and the land was acquired under S. 7, association with the competent authority, is only of the local officer of the govt. of India and not of the State Govt. The reason is obvious that the officers of the appellant are interested to collect the best evidence of the prevailing market value and would place that evidence before the competent authority to fix true and correctlocal officer had admittedly stated that though he was agreeable to the amount determined, unless the approval of the Govt. of India is obtained, he cannot give his concurrence. Thereafter no concurrence of the Govt. of India had been obtained nor was any offer communicated to the respondents for their acceptance. No records has been placed even in the earlier proceedings before the High Court of such a communication by the officer and acceptance. It is seen that under Rule 9(5) it is mandatory that every person interested in the offer shall "within 15 days of the receipt of the offer communicate in writing to the competent authority his acceptance or otherwise of the offer". It is thereby clear that the communication of the offer to the person concerned and his acceptance within 15 days thereafter from the date of the receipt of the offer are mandatory requirements and should be complied with. It is seen that the procedure has been prescribed in a mandatory language to ensure that the offer must be made after the approval by the Government concerned or with the approval of its officer specifically authorised in that behalf. The acceptance also should be in writing and must be made within the time prescribed. Otherwise the offer does not bind the Requisitioning Department for which acquisition was done or the Union of India or the owner whose land had been acquired for the public purpose. The High Court, therefore, was not right in its conclusion that there must be deemed acceptance by the respondents since they had so stated in their objection petitions the enquiry proceedings held for the determination of the compensation by the arbitrator appointed under S. 8(1)(b) of theit is settled law that the requisitioning authority is a person interested since it is interested in the fixation of the proper and just market value or compensation of the land acquired on its behalf as well as to see that the true extent of the land is acquired and is free from encumbrances. The participation in the proceedings by the local officers is to enable not only the determination of the proper and just market value or compensation in their presence after laying necessary and relevant evidence but also to secure valid title to the land acquired so that Land Acquisition Officer and the court determines just and proper market value of the lands. It is, therefore, clear that the appellant is a proper and necessary party under Order 1 Rule 10 CPC. It is also the person interested under S. 2(d) of the Act. Accordingly the view of the High Court that the appellants are not interested person is clearly illegal. It is accordingly setview of the fact that there is no agreement between the parties as contemplated under S. 8(1)(a) read with Rule 9 of the Rules, as seen earlier, the only course open to the authorities is to appoint an arbitrator under S. 8(1)(b) of the Act and the arbitrator is enjoined to determine the market value as contemplated under(3) of S. 8 of the Act. In that view, necessarily, the matter has to be remitted for the decision by the arbitrator to be appointed by the State Govt. under S. 8(1)(b) fresh. But on the facts in this case since 23 years have elapsed, we find no jurisdiction to remit the matter. The competent authority had fixed the market value at the rate specified earlier and admittedly local offices had associated themselves with the competent officer at that time of fixation of the marketwe conclude that the determination of the solatium at 15% and interest at 4% by the competent authority under S. 8(3) of the Act is illegal. Therefore, to that extent it is set aside. However, fixation to market value at the rates specified above are upheld in the peculiar circumstances of the case. This court has given interim directions from time to time and directed the appellant to deposit half of the amount determined together with the solatium and interest etc. In the light of the decision now given, the competent authority is directed towork out the total compensation payable to the lands, acquired at the rate specified by it as now upheld, deduct the amount already paid to the respondents in pursuance of the directions issued by this court from time to time. If any balance amount is found due and payable by the appellant, it should be so determined, and would communicate the same to the local officer of the appellant. The competent authority is directed to decide the matters as above within a period of two months from the date of receipt of this order and the appellant is directed to deposit the balance amount, if any, within a further period of three months from the date of the receipt of the notice by the local officer.