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 acquisitio