Case: U.P. AWAS EVAM VIKAS PARISHAD THROUGH HOUSING COMMISSIONER Vs. RAM SINGH (D) TH. LRS. &amp; ORS

2. These appeals have behind them a chequered history. It all began with the issuance of a Notification by the appellant under Section 28 of the U.P. Awas Evam Vikas Parishad Adhiniyam, 1965 (hereinafter referred to as the Adhiniyam) on 10.11.1973. The said Notification is to be treated as equivalent to a Notification issued under Section 4 of the Land Acquisition Act, 1894, proposing to acquire among other lands, Khasra Plot No. 7 and Khasra Plot No. 3, having a total area of 5.98 Acres in a certain village which originally belonged to one Shri Ram Ratan. It may be noticed here itself that Ram Ratan has passed away and the respondent-Ram Singh was his son and he has in turn passed away and is represented by his legal representatives. The appellant issued a Notification under Section 32 of the Adhiniyam on 17.8.1977. This is the equivalent to the Notification issued under Section 6 of the Land Acquisition Act. The urgency clause under Section 17(1) of the Land Acquisition Act was invoked on 18.07.1979. According to the appellant, the possession of the land was taken on 11.12.1981 and 31.3.1983.The further case of the appellant is that there was a case of a sale effected by the original respondent-Ram Singh. There is a reference to the notice issued under Section 9 of the Land Acquisition Act on 25.09.1985 and an Award being passed on 28.09.1985.3. It is the further case of the appellant that the original respondent-Ram Singh submitted an application on 19.11.1985 claiming compensation stating, inter alia, that he was the son of the Original Tenure Holder and that he had not executed any sale deed in respect of the land. There is a copious reference to certain litigation initiated against the subsequent purchasers (Dr. Raj Kumar Chaturvedi & Ors.). To come to the point in issue, it started with the Notification which was issued on 07.07.2005 purporting to exempt Khasra No. 3 and 7 from the acquisition. The appellant thereupon submitted a representation on 24.10.2005, inter alia, pointing out that the land has been acquired and the Award has been passed and what is more, possession was also taken. It is also contended that mutation was effected in favour of the appellant. This led to the Government issuing Notification dated 25.04.2008. The Government in the said Notification cancelled the earlier Notification dated 07.07.2005 and directed the matter for consideration by the concerned department. Aggrieved by the said Notification dated 25.04.2008, respondent-Ram Singh filed a Civil Misc. Writ Petition No. 49944 of 2008. The said writ petition came to be allowed by the High Court by judgment dated 31.08.2010. Aggrieved by the judgment dated 31.08.2010, the appellant preferred special leave petitions SLP(C) Nos.34271 OF 2010 and 34090 of 2010. Leave was granted and Civil Appeal No. 6272 of 2012 and Civil Appeal No. 6273 of 2012 came to be disposed of by this Court permitting the appellant to seek a recall of the order dated 31.08.2010. The appellant moved an application for recall of order dated 31.08.2010 and the same was rejected by the High Court vide order dated 20.12.2016. The appellant challenges the orders dated 31.08.2010 and 20.12.2016. The other appeals are filed by the same appellant challenging the judgment on similar lines which have been passed in litigation lodged by persons claiming to have purchased from Shri Ram Singh in the year 1984.

Court's reasoning:
15. At first blush, it gives the impression that it gives an unbridled license, as it were, to the Government to withdraw from an acquisition. Since it is a power which is vested with a statutory authority as in the case of all power, the trammels of fairness in Governmental action and the imperative need to avoid arbitrariness is inevitable in the exercise of the power under Section 48. This has been made clear by this Court in the Judgments reported in 1998 (1) SCC 591 and 1998 (4) SCC 387. In 1998 (1) SCC 591,  the acquisition was made of land adjacent to the appellants school. The government invoked Section 48 of the Land Acquisition Act, 1894. The reason stated for withdrawing was that as no part of the cost was to be borne by the government, the acquisition would not be sustained as for a public purpose. The court found the reason illegal being based on a misconception, arbitrary and not bonafide. The appellant succeeded. The government was left free to reconsider the matter. There is no arbitrary power to withdraw from the acquisition. The decision under Section 48 was held to be a justiciable issue.In Larsen & Toubro Ltd. v. State of Gujarat and Others, 1998 (4) SCC 387  this court declared that a notification is to be published if power is to be exercised under Section 48, and furthermore opportunity must be given to the company for which the acquisition was being made. We notice the following discussion.31. Principles 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-section (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 to 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 mandatory 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 Act 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&T Ltd.) and are, thus, not legal.16. The decision to withdraw from acquisition is justiciable. In other words, what is described as a liberty or a power with the Government must be understood also as being attended with the duty to act in a fair and bona fide manner. This means that present the inevitable and indispensable requirement, namely, that actual possession of the land has not been taken under the Act, it is open in a fit and appropriate case and bearing in mind public interest and the facts for the Government to withdraw from the acquisition. It is the duty of the authority to be mindful of all relevant inputs before it takes a decision to withdraw from the acquisition. It is also clear that withdrawal from the acquisition must be preceded by offering an opportunity to the beneficiary at whose instance the acquisition is to be made. It is also clear that the withdrawal from acquisition can be made only by issuance of a notification. The reasoning for the same has been elaborately supplied in the judgment of this Court in the case of 1998 (4) SCC 387 (supra). In 2001 (1) SCC 610  this court reiterated that an opportunity of being heard must be given to the beneficiary before power is involved under Section 48.In this case, a representation was given by the land owner and the alleged purchasers from the land owner. It was, inter alia, their case that possession had not been taken. On the basis of the said request, a Notification under Section 48 has been issued on 07.07.2005. The contents of the notification would tend to indicate, inter alia, that possession of the land was not taken and taking of possession is not actual possession. We have already noticed that the taking of possession which would prevent the exercise of power under Section 48 must be taking of khas possession or actual possession. The notification dated 07.07.2005 further recites that the appellant was notified about the proposal and what is more it was followed up by three reminders. It is further noticed that there was no response from the appellant. Therefore, this is not a case where flouting the law laid down by this Court, withdrawal from the acquisition was made under Section 48 without compliance with principles of Natural Justice as far as the beneficiary is concerned.19. The order recites no doubt that there is no notice issued under Section 9 (3) of the Land Acquisition Act. Here we may notice that a perusal of Section 17 (1) of the Land Acquisition Act would show that the possession can be taken in cases where urgency clause is invoked, upon the expiry of 15 days of the publication of notice under Section 9 (1). Here the authority apparently has not looked into the question as to whether possession was taken with reference to the relevant date which is the publication of notice under Section 9 (1). Section 9(1) of the Land Acquisition Act in fact speaks about the need to give a public notice. Section 9 (3) speaks about duty to give individual notices to land owners. As correctly pointed out by Shri Vishwajit Singh, non-service of notice under Section 9 (3) would not be sufficient to invalidate the acquisition. But then the relevance of Section 9(3) notice as pointed out by Shri Yathendra Singh is that if it had been produced and proved, it would have gone a long way in proving the case of the appellant that possession had in fact been taken. In this regard, it is apposite to notice that in the appeal carried by the appellant to this Court, the appellant held out that it had material to show that notice was issued.21. The contents of the notice would clearly show that it cannot be understood as a notice under Section 9(3). Instead, it is a notice notifying the owner about the fact that the award is going to be passed on 28.09.1985. We may notice that the date of the so- called notice under Section 9 (3) is 25.09.1985. A notice under section 9 is to be followed by enquiry under Section 10 and award under Section 11 certainly cannot be confused with notice which merely notifies the owner about the date fixed for passing the award. There is only a gap of three days between the date of the notice and the date fixed for passing of the award. Therefore, the appellants have not been able to establish any notice under Section 9 (3) was issued.22. It is no doubt true that Shri Vishwajit Singh is correct in pointing out that the recitals in the award are that the respondent (original owners son) was heard and, in the award, it is mentioned also that there was a money suit which was decreed against the respondent and the decretal amount came to be partially adjusted from out of the proceeds of the award.23. However, passing on to the premise of the impugned order dated 25.04.2008, we find that after referring to the request made by the appellant, the authority has purported to draw support from the order dated 15.09.2006 issued by the Government. The order dated 15.09.2006 undoubtedly proclaimed that exemption from acquisition or rather withdrawal from acquisition must receive the attention of the concerned department. Its terms would indicate that Government decided to do away with the earlier order passed in the year 2002. The order dated 15.09.2006 is explicit in that, it was to have an immediate effect. This means that it was not retrospective. This further inevitably means that it cannot affect orders/notifications which had been issued invoking power under Section 48 prior to 15.09.2006. Yet a perusal of the order dated 25.04.2008 would reveal that the Government has proceeded to act on the basis of order dated 15.09.2006. In other words, the impugned order which has been set aside by the High Court is entirely based on an order which has no application to the facts. We say this for the reason that we wish to clarify that it is not as if when a notification is issued under section 48, it can never be undone irrespective of the facts obtaining in a case. Apart from the fact that it is open to challenge in a court of law at the instance of an aggrieved party in a given case if it is shown it is procured by fraud, it may be open to the authority to undo the same. It is an administrative order, no doubt issued under a statutory provision by a public authority. Since the law is that principles of natural justice apply and the power can be exercised only after offering an opportunity to the beneficiary as distinct from the owner, in a case where it is found that a notification was issued without notice, which is indispensable to passing of a valid notification, it may be open to the Government to undo the effect of the notification. In the facts of this case, it is not even the case of the appellant in its representation that the recital in the notification that it was given opportunity to make its representation against the proposed action was wrong. The appellant did not have a case in its representation that it was not given any opportunity to represent against the order. The appellant seeks to make good this omission by contending that a ground was raised that there was violation of natural justice. We do not think we should permit the appellant to make good an omission which stares in our faces, in the facts of this case. We think that the appellant has not made out a case for interference with the impugned orders.