Judgement

SIKRI, J.: The Municipal Committee, Jalalabad, respondent before us in these appeals, filed an application under Articles 226 and 227 of the Constitution praying that Section 20B of the Displaced Persons (Compensation and Rehabilitation) Act, 1954 - hereinafter referred to as the Compensation Act - be declared ultra vires the Constitution and that the memorandum dated March 14, 1963, communicated by the District Rent and Managing Officer, Jalalabad, be quashed. The learned Single Judge, following an earlier judgment of the Punjab and Haryana High Court in Kirpal Singh v. The Central Government, ILR (1967) 2 Punj & Har 574, held that Section 20B of the Compensation Act was ultra vires and quashed the impugned order dated March 14, 1963, and directed the restoration of the property in dispute to the Municipal Committee. An appeal was taken to the Letters Patent Bench but this was dismissed in limine. Two appeals have been filed against this judgment, one by the Union of India and its officers who are interested only in the question of the vires of the Section , and the other by Lachhmandas and others to whom the shops in dispute have been transferred.

2. The relevant facts may be stated shortly. The Nawab of Mamdot became an evacuee in 1947 on the partition of the country and his property was taken over by the Custodian as evacuee property. In 1949, the District Rent and Managing Officer treated five shops, situated in Chowk Kalan, Jalalabad, as belonging to the Nawab of Mamdot and began to recover the rent of the shops from the tenants. The Municipal Committee protested and lengthy correspondence ensued between the Municipal Committee and the Custodian. Eventually the Municipal Committee filed a Civil Suit in 1958 against the Union of India for a declaration that the said shops were their own property and not evacuee property. Ultimately, the Trial Court, by order dated January 8, 1962, made a reference to the Custodian General for determining the question whether the shops in dispute were evacuee property or not. The Deputy Custodian General, exercising his powers under Section 27 of the Administration of Evacuee Property Act, 1950 (hereinafter referred to as the Evacuee Act) held that the property in dispute had been wrongly taken over as evacuee property and ordered that the five shops be released in favour of the Municipal Committee, Jalalabad. On this, the Municipal Committee applied to the Regional Settlement Commissioner, under Rule 37 of the Administration of Evacuee Property (Central) Rules, 1950 for the restoration and possession of the five shops. On March 14, 1963, the District Rent and Managing Officer, Jalalabad, sent a memorandum to the Municipal Committee stating that the property in dispute had already been transferred to the occupants and disposed of under the Compensation Act and that its assessed price was Rs. 6542/-. In the memorandum it was further stated:

"It is not, therefore, expedient or practicable to restore the above property to you and it has, therefore, been decided to transfer you any other immovable property in the compensation pool of the equal amount in lieu thereof under Section 20B of the D. Ps. (C & R) Act, 1954." The memorandum also listed some properties which were available for transfer to the Municipal Committee. This is the memorandum that has been quashed by the High Court.

3. The above proposal was not acceptable to the Municipal Committee. It was pointed out by the Municipal Committee in reply that it was incorrect that all the five shops had been transferred and that the assessment price was Rs. 6452/-. According to the Municipal Committee only one shop out of these, in possession of Dogar Mal Ram Chand, had been auctioned for Rs. 10,100/- although the sale had not matured.

4. It appears that one shop was released in favour of the Municipal Committee but the Department refused to release the other shops. After unsuccessfully approaching the Settlement Officer, with delegated p