Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1967 Supreme(SC) 269

SUPREME COURT OF INDIA
J.C. SHAH, S.M. SIKRI AND J.M. SHELAT, JJ.
Abdul Hussain Tayabali etc., Appellants
Versus
The State of Gujarat and others. (in all the appeals), Respondents.
Civil Appeals Nos. 369 to 375 of 1967
D/- 20-9-1967.
Advocates Appeared
Mr. G. L. Sanghi, Advocate, and Mr. Ravinder Narain, Advocate of M/s. J. B. Dadachanji and Co. for Appellants (In all Appeals), Mr. Bishan Narain, Senior Advocate, (Mr. R. H. Dhebar, Advocate for Mr. S. P. Nayar, Advocate, with him), for Respondents No. 1 and a (In all Appeals); M/s. Arun H. Mehta and I. N. Shroff, Advocates for Respondent No. 3 (In all Appeals).

Advocates:
Anu Mehta, BISHAN NARAIN, G.L.SANGHI, I.M.SHROFF, J.B.DADACHAN, R.H.Dhebar, Ravindra Narayan, S.P.NAIR

The Court clarified the interpretation of Section 3 (c) of the Land Acquisition Act and held that the appointment of an officer as the Collector under that provision can be made by virtue of office and not necessarily by name.

Headnote:
LAND ACQUISITION - Notification under Section 4 and 6 - Validity - Inquiry under Rule 4 of Land Acquisition (Companies) Rules - Appointment of Collector - Interpretation of Section 3 (c) - Mala fide exercise of power - Public purpose - Opportunity of hearing under Section 5-A.
Fact of the Case:

The appellants challenged the validity of notifications issued under Sections 4 and 6 of the Land Acquisition Act, 1 of 1894, for the acquisition of their lands for a fertilizer factory. The appellants contended that the inquiry under Rule 4 of the Land Acquisition (Companies) Rules was invalid, the acquisition was mala fide, and they were not given an opportunity of being heard before the issuance of the Section 6 notification.
Finding of the Court:

The Court held that the inquiry under Rule 4 was validly conducted by the Special Land Acquisition Officer (Master) who was duly appointed as the Collector under Section 3 (c) of the Act. The Court found that the acquisition was not mala fide and the State Government had applied its mind to the facts of the case. The Court also held that the appellants were given an opportunity of being heard during the Section 5-A inquiry and there was no requirement for a second opportunity before the issuance of the Section 6 notification.
Issues: 1. Whether the inquiry under Rule 4 of the Land Acquisition (Companies) Rules was validly conducted? 2. Whether the acquisition was mala fide and the State Government had applied its mind to the facts of the case? 3. Whether the appellants were given an opportunity of being heard before the issuance of the Section 6 notification?
Ratio Decidendi: 1. The Court interpreted Section 3 (c) of the Land Acquisition Act and held that the appointment of Master as the Collector was valid. The Court found that the notification dated October 11, 1963, which authorized all Special Land Acquisition Officers in the State to perform the functions of the Collector, was a special appointment as required by the Act. 2. The Court examined the facts and circumstances of the case and found no evidence of mala fides or non-application of mind by the State Government. The Court noted that the Government had obtained reports and conducted inquiries before issuing the notifications. 3. The Court held that the appellants were given an opportunity of being heard during the Section 5-A inquiry. The Court found that Section 5-A does not require a second opportunity to be given before the issuance of the Section 6 notification.
Final Decision: The Court dismissed the appeals and upheld the validity of the notifications issued under Sections 4 and 6 of the Land Acquisition Act.

Judgement

SHELAT, J. :- These appeals by certificate are directed against the judgment of the High Court of Gujarat dismissing the writ petitions filed by the appellants for quashing the notifications dated August 28, 1964 and October 18, 1965 respectively issued under Sections 4 and 6 of the Land Acquisition Act, 1 of 1894.

2. The appellants are the owners of the lands in question situate at Ranoli, District Baroda. The 3rd respondent Company also owns about 140 acres of land in the same village. The appellants lands are either situate adjacent to and between the Company s lands and the railway lines or are enclaves surrounded by lands belonging to the Company. On July 22, 1961 the Stab Government issued a notification under Section 4 of the Act to the effect that the appellants said lands were or were likely to be needed for a public purpose, viz., for a fertilizer factory. That notification was withdrawn on September 11, 1962 as the lands were stated to be unsuitable for such a factory. The Government however issued the very next day a fresh notification under Section 4 in respect of the same lands, this time for the purpose of the 3rd respondent Company. Some of these appellants thereupon filed writ petitions challenging its validity. While these petitions were pending before the High Court this Court delivered its decision in what is known as the first Arora Case, AIR 1962 SC 764. To get over the difficulties arising from that decision, first an ordinance and then the Amendment Act XXXI of 1982, were passed. The Amendment Act was brought into force from July 20, 1962 with retrospective effect. The Central Government thereafter made Rules under Section 55 of the Act called the Land Acquisition (Companies) Rules which were brought into force from June 22, 1963.On July 24, 1963 the State Government withdrew the notification dated September 12, 1962 whereupon the writ petitions filed by the appellants challenging the said notifications were withdrawn. In the meantime one D. K. Master, who was then the Special Land Acquisition Officer Baroda, started an inquiry under Rule 4 of the said Rules. On August 28, 1964 the State Government issued a notification under Section 4 stating that the appellants said lands were needed or were likely to be needed for the establishment of a factory of the 3rd respondent Company. The appellants filed their objections in the inquiry then held under Section 5-A but they were rejected. On October 18, 1985 the State Government issued Section 6 notification declaring that the said lands were needed for the factory of the 3rd respondent Company which it was stated was taking steps or engaging itself for manufacture of optical bleaching agents, intermediate dye-stuffs etc., which according to the Government was for a public purpose.

3. The appellants thereupon filed writ petitions from which these appeals arise challenging the two notifications dated August 28, 1964 and October 18, 1965 respectively. When these writ petitions came on for hearing, the State Government produced a notification dated October 11, 19 authorising the Special Land Acquisition Officers of the State to perform the functions of the Collector under Section 3 (c). On certain contentions having been raised on the basis of this notification, the High Court adjourned the hearing to enable the State Government to explain the circumstances and the reasons for issuing the said notification. On August 25, 1966 the said Master led a further affidavit clarifying the Government s position and the circumstances in which he performed the functions of the Collector under Section 3 (c).

4. Before the High Court the appellants contended that the procedure laid down in the said Land Acquisition (Companies) Rules was not followed, that the purpose for which the acquisition was being made was not a public purpose within the meaning of Section 40 (1) (an), that the acquisition was made mala fide and in colourable exercise of power, that the State Gove

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