Judgment

RAY, J. :- This appeal is by special leave from the judgment dated 13 January 1961 of the High Court at Patna dismissing the appeal filed by the appellants against the award dated 25 May, 1956 of the Arbitrator under the Requisitioning and Acquisition of Immovable Property Act, 1952 (hereinafter referred to as the 1952 Act).

2. The appellant s mother purchased the property known as "the Grove" situate on Station Road at Patna on 18 September, 1944. The appellants mother thereafter made a trust deed in the year 1946 in respect of the property in favour of the appellants.

3. The property was requisitioned by the Government of India with effect from 17 July, 1942 under Rule 75 (A) of the Defence of India Rules. The Government was in possession of the property until the Government decided to acquire the property in the year 1953. The Central Government gave notice under S. 7 of the 1952 Act to acquire the property. The property was acquired in 1953.

4. The Government thereafter offered to the appellants a sum of Rs. 2,47,990/- as a valuation of the property acquired. The appellants claimed Rs. 18,00,000/- as the valuation.

Under Section 8 (1) of the 1952 Act the Government appointed the District Judge, Patna as the sole Arbitrator to determine the amount of compensation payable to the appellants in respect of the property. The Arbitrator held that in view of the provisions contained in sections 23 and 24 of the 1952 Act the provisions of section 8 (3) (b) of the 1952 Act would apply for determination of compensation payable for acquisition of the property.

The appellants preferred an appeal against the award of the Arbitrator. Section 11 of the 1952 Act provided for such appeal.

The High Court held that S. 8 (3) (b) of the 1952 Act applied and upheld the award of the Arbitrator.

5. The question which falls for consideration in this appeal is whether the compensation would be determined under clause (a) or (b) of sub-sec. (3) of Section 8 of the 1952 Act. The relevant provisions are set out hereunder :

"8 (3). The compensation payable for the acquisition of any property under section 7 shall be -

(a) the price which the requisitioned property would have fetched in the open market, if it had remained in the same condition as it was at the time of requisitioning and been sold on the date of acquisition, or

(b) twice the price which the requisitioned property would have fetched in the open market if it had been sold on the date of acquisition, whichever is less".

Counsel for the appellants raised these contentions. The Defence of India Act, 1939 and the Rules made thereunder ceased to be effective on 14 February, 1946. There was no order of requisition under the 1952 Act. For the purpose of determination of compensation of the property under the 1952 Act the property could at best be held to be requisitioned when the 1952 Act came into existence. It was erroneous to treat the property to be requisitioned under the 1952 Act.

6. The essence of the appellant s contention is that the year of requisition should be 1952 when the 1952 Act came into effect. This contention is unsound. The requisitioned Land (Continuance of Powers) Ordinance, 1946 (Ordinance No. XIX of 1946) provided in Section 3 thereof that "notwithstanding the expiration of the Defence of India Act, 1939 and the Rules made thereunder, all requisitioned lands shall continue to be subject to requisition until the expiry of this Ordinance and the appropriate Government may use or deal with any requisitioned land in such manner as may appear to it to be expedient; provided that the appropriate Government may at any time release from requisition any requisitioned land". The property continued to be in possession of the Government under orders of requisition dated 17 July, 1942. The property was not released from requisition. It is manifest from Ordinance No. XIX of 1946 that the property which was requisitioned under the Defence of India Act continued to be subject of requisition