1. Compulsory land acquisition under a town expansion scheme for industrial development — Challenge to the validity of the supplementary scheme and the Trust's power to acquire land. (Para 1 , 2 , 3 , 4 )
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1966 Supreme(SC) 111
SUPREME COURT OF INDIA
K.N. WANCHOO, M. HIDAYATULLAH, AND J.C. SHAH, JJ.
Dalchand and others, Appellants
Versus
Delhi Improvement Trust (New Delhi Development Authority), New Delhi, Respondent.
Civil Appeal No. 1107 of 1963, D/ 24-3-1966.
Advocates appeared
Mr. B. D. Jain, Advocate, for Appellants, Mr. N. S. Bindra. Senior Advocate (Mr. B. R. G. K. Achar, Advocate, with him), for Respondent.
Advocates:
B.D.Jain, B.R.G.K.Achar, N.S.BINDRA
B.D.Jain, B.R.G.K.Achar, N.S.BINDRA
Land acquired by an improvement trust for a town expansion scheme is valid even if subsequently allotted to a private company for development, provided it serves a public purpose. Such acquisition is for the scheme's execution, not for the company, exempting it from Part VII of the Land Acquisition Act.
Headnote:(A) United Provinces Town Improvement Act, 1919 - Sections 23(a), 23(g), 24, 32, 56 and 65 - Land Acquisition Act, 1894 - Part VII - Acquisition of land for town expansion scheme - Validity of supplementary scheme - Power to acquire land for industrial development - Whether acquisition of land to be subsequently allotted to a private company for development falls within the scope of the Act - If the original scheme is for town expansion and relief of congestion, a supplementary scheme to meet the requirements of that original scheme is valid - Acquisition of land for the purpose of a town expansion scheme, even if subsequently allotted to a company for development under the trust's supervision, does not necessitate compliance with Part VII of the Land Acquisition Act, as the acquisition is for the scheme and not specifically for the company. (Paras 9, 10, 11, 14)
(B) Town Expansion Scheme - Power of compulsory acquisition - Section 23(a) authorizes acquisition of property necessary for or affected by the execution of any improvement scheme, including town expansion schemes. (Para 13)
(C) Compensation - If the acquisition is valid under the specific Act, the award cannot be challenged on the ground that another method of acquisition might have yielded higher compensation or statutory solatium. (Para 16)
Facts of the case:
An improvement trust framed an industrial development scheme for town expansion to relieve congestion. A supplementary scheme was later created to acquire additional land to meet the requirements of the original scheme. Land belonging to the appellants was acquired under this supplementary scheme. The appellants challenged the acquisition, contending that the trust had no power to acquire land for the benefit of a private company and that the procedure under Part VII of the land acquisition law should have been followed.
Findings of Court:
The court held that the supplementary scheme was an extension of the original town expansion scheme. The acquisition was for the purpose of industrial development and relief of congestion, not for the private gain of a company. The trust retained general supervision and control over the execution of the scheme.
Issues: (1) Whether acquisition of land under the supplementary scheme was for the purposes of the Act; (2) whether the trust had power to compulsorily acquire land for executing the supplementary scheme; and (3) whether the land could be acquired only under Part VII of the Land Acquisition Act, 1894.
Ratio Decidendi: A scheme for town expansion that includes the acquisition of land to be subsequently allotted to an industrial concern for development is valid if it serves the public purpose of industrial development and relieving urban congestion. Such acquisition is for the execution of the scheme and not "for" the company; therefore, the stringent requirements of Part VII of the Land Acquisition Act are not applicable.
Result: Appeal dismissed.
Legal Category Hierarchy
Table of Contents
2. Validity of the Act's extension — Trust's power to acquire land for industrial schemes — Allegation that acquisition was for the private benefit of a company. (Para 4 )
3. Supplementary scheme as extension of valid town expansion scheme — Acquisition for industrial development serves public purpose of relieving congestion — Trust's power to acquire under Section 23(a). (Para 9 , 10 , 11 , 12 , 13 )
4. Acquisition for a public town expansion scheme is valid even if land is later allotted to a private entity for development under Trust supervision. (Para 11 , 14 )
5. Appeal dismissed. (Para 17 )
6. Does a town expansion scheme under the United Provinces Town Improvement Act authorize the compulsory acquisition of land?
Yes. Section 23(a) authorizes the acquisition of any property necessary for or affected by the execution of an improvement scheme, and Section 56 expressly confers the power to acquire land under the Land Acquisition Act, 1894. (Para 13 )
7. Is a land acquisition scheme invalid if land is acquired for a public purpose but subsequently allotted to a private company for development?
No. If the acquisition is part of a valid town expansion scheme to achieve public goals like relieving congestion, it is not invalid simply because the land is later disposed of to a private industrialist for development under Trust control. (Para 11 , 12 , 14 )
8. When must Part VII of the Land Acquisition Act be complied with during land acquisition?
Part VII applies when land is notified for acquisition specifically for a company. It does not apply when land is acquired for a Trust's public scheme and subsequently allotted to a company for development. (Para 14 )
Judgment
SHAH, J. : By a notification issued on March 2, 1937, under S. 7 of the Delhi Laws Act 13 of 1912 the Government of India extended, subject to certain modifications, the UNITED PROVINCES TOWN IMPROVEMENT ACT 8 of 1919 to the territory of Delhi, and thereafter set up an Improvement Trust under the Act for that territory. The Trust prepared an industrial development scheme with the object of relieving congestion by inducing a flow of population from the crowded parts of the town of Delhi to certain other areas. Under the scheme land in those areas was to be developed and after construction of roads, storm water drains, street-lighting, refuse and sewage disposal works, schools. parks, playgrounds, dispensaries, welfare centres and police-station a part of the land was to be allotted to industrial concerns for construction of industrial buildings and the rest for construction of residential and other buildings.
2. The scheme was sanctioned under S. 42 of the Act by the Government of India, and was duly promulgated. Thereafter the Trust resolved in June 1942 to make a supplementary scheme as the land covered by the original Scheme was inadequate. It appeared that the Trust had agreed to provide under the original scheme a block of land comprising 268 acres of land to the Delhi Cloth and General Mills Company Ltd. - hereinafter called the Company - on certain terms and conditions embodied in a resolution, dated January 9, 1942, but the Trust was able to offer to the Company under the lay-out of the original scheme only 174.84 acres. It was therefore proposed by the Trust to modify the scheme as sanctioned and to provide for acquisition of an additional area of 103.16 acres under a supplementary scheme.
3. On July 18, 1942, notice under S. 36 of the Act was published in respect of the supplementary scheme for development of the industrial area, specifying the boundaries of the land in which the scheme was to be worked and inviting objections to the scheme within one month from the date of publication. No objections were, it appears raised to the proposed supplementary scheme, and it was finally approved by resolution dated July 31, 1944 and was notified under S. 42 of the Act on June 28, 1946. Land acquisition proceedings were then commenced under S. 58 of the Act and awards were made assessing compensation to be paid to the owners of the land for compulsory acquisition. In the scheme so notified was included an area of 13 bighas of land belonging to the appellants and that land was acquired.
4. On May 3, 1949, the appellants sued the Delhi improvement Trust for a declaration that the awards were "wrong and illegal and did not result in acquisition of the suit property and for an order restraining the Trust from taking possession of their lands under the awards and from interfering in any way with their enjoyment of the lands The appellants in support of their claim contended that the notification extending the UNITED PROVINCES TOWN IMPROVEMENT ACT 8 of 1919 was invalid that the Improvement Trust was not lawfully constituted, that the industrial development schemes were invalid, that the Trust had no power to acquire lands for the purposes mentioned in the scheme and that the resolutions and proceedings of the Trust being procedurally defective, the scheme was illegal. The appellants also contended that the scheme was framed at the instance of and solely for the benefit of that Company, since the land was intended to be given after acquisition to that Company or to other industrialists for development by them for their own benefit. The Subordinate Judge, Delhi, held that the Act was properly extended to the Delhi territory, that the scheme was valid and the Trust had power to acquire the land, but in the view of the Subordinate Judge there was "nothing on the record to show that the area in Suit was "necessary for or" was "affected by the execution of this scheme", and that "the Act does not authorise compulsory acquisit
