Case: Shyam Nandan Prasad &amp; Others Vs. State of Bihar &amp; Others

3. The appellants herein are a few members of the Bihar Finance Service House Construction Cooperative Society, a society registered wayback in the year 1973, under the Bihar and Orissa Cooperative Societies Act. Its members, the appellants state, are about 400 in number. It was stated to have been floated by members of the Bihar Finance Service who were landless and did not own any residential plot or house in the city of Patna. Statedly, its membership was not confined to the members of the Bihar Finance Service alone but was open to everyone who was similarly landless. The Society was organised and knit to secure from the State Government land by acquisition so that the society could give plots to its members or build houses and give them to its members. For the purpose, in 1973 itself it put a proposal to the State Government to acquire 59.95 acres of land in the revenue estate of village Kumhrar, a part of the city of Patna. After some steps, the State Government issued a notification under Section 4 of the Act on 21.4.81 inviting interested persons to file their objections under Section 5A of the said Act. On objections received from interested persons, and disposed of by the Additional Land Collector, and on report submitted, declaration under Section 6 of the Act was made to acquire land to the extent aforementioned except 5 acres which were set apart for allotment to persons likely to be disturbed by the acquisition. On writ petitions filed, the High Court quashed the declaration under Section 6 remitting back the matter to the State Government for reconsideration on two counts, one such count being violation of the mandatory provisions of SectionThis is how the matter has come before us in appeal.4. It prominently needs to be mentioned, at this stage, that both the notifications under Sections 4 and 6 were issued in the state of law as was existing prior to the passing of the Land Acquisition (Amendment) Act, 1984 (Act No. 68/1984). This law on the subject rather was substituted and amended by various Bihar legislative enactments. It is to the law as applicable in the State of Bihar shall we henceforth advert to for deciding this matter.

Court's reasoning:
17. The High Court, in the facts and circumstances, has, however, held that no report of the enquiry under(2) of Rule 4 was forwarded by the State Government to the Land Acquisition Committee and it consented to the acquisition in violation of the command of law. The High Court has also gone on to say that the consent of the State Government violated(3) of Rule 4. On the aspect of Section 40 of the Act, the High Court has even gone on to hold that the writ petitioners were not given opportunity to dispel the heeds of the company by holding a proper enquiry. It seems innately to be entertaining the view that the Government would not have gone on to give consent unless it could in the contemplated enquiry get a finding that the object of the acquisition was one of those as mentioned in Section 40. And lastly, the High Court has concluded that enquiry under Sectionwas vitiated inasmuch as interested persons were not sent personal notices of the notification as required under the law, those who received such notices and had objected, were not given proper opportunity of being heard, the file of objection summoned revealed a casual observance of the procedure, no proper opportunity was given to the objectors to place material before the officer and that when the officer had himself obtained a report of spot inspection, he did not give opportunity to the objectors to dispel his impressions thereon. Apart from that the High Court suspected certain interpolations in the file. Thus impelled, the High Court went on to remand on account of vitiation of the enquiry under Section5A of theAct and violation of the mandatory provision of Rule 4, and its compliance as a condition precedent to the employment of Section 6 of the Land Acquisition Act.18. The picture will not be complete without the uncontroverted plea of the appellants being noted that by January 1984, after the agreement under Section 41 was signed and published on 4th March 1983, and after the issuance of the declaration under Section 6 on 18th March, 1983, an award was prepared for Rs. 89,28,663 which sum stood deposited with the Government by the society by January 1984. The society claims that the possession of the land was given to it on 2.8.84 and many plots stood distributed amongst its members by proper registered documents. On the latter aspect, there was a dispute of fact. The writ petitioners who too were some cooperative house building societies, originaland transferees of land, had been asserting that they were in possession, and some of them had claimed to have either erected or be in the process of erecting buildings. The High Court had, as an interim measure, ordered status quo to be maintained. The High Court in its final verdict posed the question as to which cooperative society could have dominance, as on both sides cooperative societies were pitted against each other, both having the avowed object of housing, and which one need be preferred was a baffling question. Learned Counsel for the parties, besides convassing their respective points of view on law, ventured to show us documents about the enquiry supposedly held to satisfy the requirements of Section 43 or/and of Rule 4 of the Rules as also of proceedings under Section5A of theAct, for and against the governmental action. On the layers and layers of common facts, leaving aside individual facts, the High Court steered a common course to effect a remand. In the circumstances, we feel that it was a possible view which the High Court could have taken but this view put settlement of the dispute beyond sight. Here the High Court seems to have erred in not, at least, restricting the terms of the remand. Persons who had not gone before the High Court in writ petitions need not have been given relief. The remand should have been confined to the interests of those who were the objector writ petitioners before the High Court. There should not have been a remand as wholesome as it is. The declaration under Section 6 should have been allowed to be sustained pertaining to land in other than the land of the writ petitioners, and so far as the writ petitioners are concerned, their cases individually on both aspects need to have been seen by the High Court itself. And delay, if any, in the facts and circumstances of each case, in approaching the High Court could have had a determinative effect.19. Instantly the Notification under Section 4 is couched in terms that land is required to be taken over by the Government for a public purpose, that is, for the Bihar Finance Service Housing Construction Cooperative Society, on the cost of Society. Though Section 4requires the appropriate Government to notify its intention to acquire land which is needed or is likely to be needed for any public purpose, it nowhere makes it incumbent at that stage to specify as to whether the public purpose would be achieved by some activity of the government or would it be passed over to a company. Nowhere the intention of the Government, as expressed, was to achieve the public purpose for providing the Society, at the cost of the Society, land for its avowed purposes. The interested persons moving objections under Sectionwere made alive to the nature of the acquisition. Finally while issuing Section 6 notification, declaration was made to acquire land for the same public purpose. This declaration was in consonance with(1) of Section 6 as substitutedly applicable in Bihar, which is asSubject to the provisions of Part VII of the Act, where the appropriate Government is satisfied after considering thereport, if any, under the proviso to(2) of Sectionor the Collector is satisfied after hearing the objection, if any, under Sectionparticular land is needed for a public purpose, or for Company, a declaration shall be made by the appropriate Government or the Collector, as the case may be, to that effect in writing:Provided that no such declaration shall be made unless the compensation to be awarded for such property is to be paid by the Company or wholly or partly out of the Consolidated Fund of the State or some fund controlled or managed by a local authority.Nowhere the distinction is made between a public purpose and a purpose for the company. The acquisition of land for a company is in substance for a public purpose as all those activities mentioned in Section 40 such as constructing dwelling houses and providing amenities for the benefits of workmen employed by it and construction of some work for public utility etc. serve the public purpose. The acquisition for the company and the purpose for it can well be investigated under Sectionor Section 40, necessarily after the notification under Section 4. Reference may usefully be made to Babu Barkya Thakur v. State of Bombay (now Maharashtra) and Others, AIR 1960 SC 1203 . It was the conceded case before the High Court that there could be no acquisition for thewithout provisions of Section 40 of the Act being involved and complied with. In Babucase (supra) too, this Court has taken the view that as provided in Section 39, the machinery of the Land Acquisition Act beginning with Section 6 and ending with Section 37 shall not be put into operation unless two conditions precedent are fulfilled, namely, (i) the previous consent of the appropriate government has been obtained and (ii) an agreement in terms of Section 41 has been executed by the Company. Such consent could be given if it was satisfied on the report of the enquiry envisaged by Section(2) or enquiry held under Section 40 itself that the purpose of the acquisition is for purposes as envisaged in Section 40.In this state of law, the plea set up on behalf of the appellants that when their Society could not be treated either as a private or a Government company, was no company at all so as to remain bound to comply with Chapter VII of the Act, is of no substance. The Society as a company is bound to satisfy the requirements of Section 40 before taking aid of Sections 6 to 37 of the Act to promote its needed acquisition.Having thus clarified the law governing the field, we would open doors for streams of equities and discretions to enter in the exercise of power by the High Court under Article 226 of the Constitution. As observed earlier, we are of the view that the High Court should not have upset the notification under Section 6 of the Act as a whole and should have individualized justiceeach writ petitioner before it, having regard to the equities interplaying in each case and to the regulation of its discretion keeping in view host of other factors which weigh with the High Court to deny, grant or mould relief even when illegalities in procedure keep staring.