Case: Harinarayan &amp; Ors Vs. Union Of India &amp; Another

2. The appellants mother purchased the property known as "the Grove" situate on Station Road at Patna on 18 September, 1944. The appellants mother thereafter made a trust deed in the year 1946 in respect of the property in favour of the appellants.3. The property was requisitioned by the Government of India with effect from 17 July, 1942 under Rule 75 (A) of the Defence of India Rules. The Government was in possession of the property until the Government decided to acquire the property in the year 1953. The Central Government gave notice under S. 7 of the 1952 Act to acquire the property. The property was acquired in 1953.4. The Government thereafter offered to the appellants a sum of Rs. 2,47,990/as a valuation of the property acquired. The appellants claimed Rs. 18,00,000/as the valuation.Under Section 8 (1) of the 1952 Act the Government appointed the District Judge, Patna as the sole Arbitrator to determine the amount of compensation payable to the appellants in respect of the property. The Arbitrator held that in view of the provisions contained in sections 23 and 24 of the 1952 Act the provisions of section 8 (3) (b) of the 1952 Act would apply for determination of compensation payable for acquisition of the property.The appellants preferred an appeal against the award of the Arbitrator. Section 11 of the 1952 Act provided for such appeal.The High Court held that S. 8 (3) (b) of the 1952 Act applied and upheld the award of the Arbitrator.

Court's reasoning:
6. The essence of the appellants contention is that the year of requisition should be 1952 when the 1952 Act came intoeffect. This contention is unsound. The requisitioned Land (Continuance of Powers) Ordinance, 1946 (Ordinance No. XIX of 1946) provided in Section 3 thereof that "notwithstanding the expiration of the Defence of India Act, 1939 and the Rules made thereunder, all requisitioned lands shall continue to be subject to requisition until the expiry of this Ordinance and the appropriate Government may use or deal with any requisitioned land in such manner as may appear to it to be expedient; provided that the appropriate Government may at any time release from requisition any requisitioned land". The property continued to be in possession of the Government under orders of requisition dated 17 July, 1942. The property was not released from requisition. It is manifest from Ordinance No. XIX of 1946 that the property which was requisitioned under the Defence of India Act continued to be subject of requisition in spite of the expiry of the Defence of India Act.The power of acquire requisitioned property is to be found in section 7 of the 1952 Act. In view of the fact that the property was subject to requisition the Government desired to acquire the property in the year 1953. The property was acquired on 11 September, 1953 under the 1952 Act. The appellants became entitled to compensation under Section 8 of the 1952 Act. The two clauses (a) and (b) of section 8 (3) of the 1952 Act provide the alternative method for compensation for acquisition of property.In Union of India v. Kamlabhai Harjiwandas Parekh, (1968) 1 SCR 463  = (AIR 1968 SC 377 ) this Court held that the mode of determination of compensation prescribed in section 8 (3) (b) of the 1952 Act is arbitrary and bad. The result is that the award which was made in the present case pursuant to the provisions contained in S. 8 (3) (b) of the 1952 Act cannot be sustained. The appellants will therefore be entitled to compensation in accordance with the provisions contained in S. 8 (3) (b) of 1952 Act. it may be stated that in 1968 by an amendment clause (b) of Section 8 (3) of the 1952 Act was deleted. The 1968 Amendment has preserved clause (a) of Section 8 (3) of the 1952 Act by deleting cl. (a) and numbering it as(3) of section 8.Counselon behalf of the Government contended that though S. 8 (3) (b) of the 1952 Act was applied by the Arbitrator, in substance the Arbitrator gave effect to the provisions of cl. (a) of Section 8 (3) of the 1952 Actaward does not say so. On the contrary, the award is expressly made under the provisions of Section 8 (3) (b) of the 1952 Act. The contention of the Government therefore fails.