2008 Supreme(SC) 1337

2008(6) Supreme 402
Supreme Court of india
(From Andhra Pradesh High Court)
C.K. Thakker and D.K. Jain, JJ.
Sooraram Pratap Reddy & Ors. — Appellants
versus
District Collector, Ranga Reddy Distt. & Ors. — Respondents
Civil Appeal No. 5509 of 2008
Arising out of Special Leave Petition (C) No. 2239 of 2006
with
Civil Appeal No. 5510-5515 of 2008
Arising out of Special Leave Petition (C) No. 1135, 3387, 2902, 3388, 3389 and 3390 of 2006
Decided on : 05-09-2008

Important Points
It is not an essential condition of public use that the property should be transferred to public ownership or for public user and it is sufficient that the public derives advantage from the scheme.
Normally, a writ Court will not propel into the uncharted ocean of Governmental Policy.
Even if the acquisition did not satisfy conditions laid down under clause (a) and clause (b) of sub-section (1) of Section 40, it would be valid, if they satisfy conditions in clause (aa).
In case of colourable exercise of power by the State or fraud on statute, declaration u/s 6 of Land Acquisition Act,1894 is open to challenge.

Headnote:(a)Doctrine – Eminent Domain – Defined as the right or power of a sovereign State to take private property for public use without the owner’s consent upon the payment of just compensation – It means nothing more or less than an inherent political right, founded on a common necessity and interest of appropriating the property of individual members of the community to the great necessities and common good of the whole society – It is inherent power of a governmental entity – The modern and more liberal view, however, is that it is not an essential condition of public use that the property should be transferred to public ownership or for public user and it is sufficient that the public derives advantage from the scheme. (Paras 36, 37, 40, 41 and 45)

       (1896) 164 U.S. 112 : 41 Law Ed. 369; (1923) 262 US 700 : 67 Law Ed 1186; 270 NYP 333: 105 ALR 905; 291 NY 320; (1954) 348 US 26 : 99 L Ed 27 : 75 S Ct 98; 467 US 229 : 81 L Ed 2d 186 : 104 S Ct 2321; (2005) 545 US 469 : 125 S Ct 2655 : 162 L Ed 43; (1950) 1 SCR 869; (1968) 1 SCR 561; (1988) 3 SCC 263; (1996) 10 SCC 150; (2003) 3 SCC 128; (1996) 7 SC 302; (1997) 6 SCC 207; (2003)10 SCC 626; (2006) 4 SCC 683; (1998)1 SCC 591; (2008)1 SCC 728; (1994) 4 SCC 675 – Relied upon.

       (b)Land Acquisition Act, 1894 – Section 3(f) – Public purpose – The expression is used in a generic sense of including any purpose wherein even a fraction of the community may be interested or by which it may be benefited – A ‘public purpose’ is wider than a ‘public necessity’ – ‘Public purpose’ is bound to vary with the times and the prevailing conditions in a given locality – It would not be a practical proposition even to attempt a comprehensive definition of it. (Paras 67, 81, 86)

       (1914) 42 IA 44 : AIR 1914 PC 20; 1952 SCR 889; (1955) 2 SCR 867; 1956 SCR 18; (1955) 1 SCR 777; (1963) 2 SCR 774; (1966) 3 SCR 885; (1981) 1 SCC 166; (2007) 1 SCC 641; (1977)4 SCC 471; (1983)1 SCC 228 – Relied upon.

       (1926) 49 Mad 237 : AIR 1925 Mad 837 – Cited with approval.

       (1911) 13 Bom LR 1097 – Referred.

       (c)Constitution of India,1950 – Article 22 – Jurisdiction – Normally, a writ Court will not propel into the uncharted ocean of Governmental Policy – Well settled that in absence of illegality or violation of law, a Court of law will not interfere in policy matters. (Paras 99 and 101)

       (1972) 2 SCC 788; (2007)8 SCC 418 – Relied upon.

       (d)Land Acquisition Act, 1894 – Section 6(e) – A ‘company’ is as defined under the Companies Act, 1956, or a society registered under the Societies Registration Act, 1860 or a cooperative society under any State law. (Para 105)

       (e)Land Acquisition Act, 1894 – Chapter II and VII – Acquisition for a public purpose as also acquisition for a Company are governed by considerations of public utility – But the procedure for the two is different and if it is for a Company, then acquisition has to be effected in accordance with the procedure laid down in Part VII – Provisions of Ss. 39-41 lay down conditions precedent to the application of the machinery of the Land Acquisition Act, if the acquisition is meant for a company. (Paras 113 and 114)

       (1961) 1 SCR 128; (1961)2 SCR 459 – Relied upon.

       (f)Land Acquisition Act, 1894 – Sections 40(1)(b) and section 41 (5) – Government cannot say that Ss.40 and 41 mean this and further say that they are satisfied that the meaning they have given to the relevant words in these sections has been carried out in the terms of the agreement provided by them – It is for the Court to say what the words in Ss. 40 and 41 mean. (Para 119)

       1962 Supp (2) SCR 149 – Relied upon.

       (g)Land Acquisition Act, 1894 – Section 40(1)(a) and (b) and (aa) – Even if the acquisition did not satisfy conditions laid down under clause (a) and clause (b) of sub-section (1) of Section 40, it would be valid, if they satisfy conditions in clause (aa) – There is no reason why the State or local authority should have no power to get further development done through private agencies by lease, assignment or sale of acquired land. (Paras 121 and 129)

       (1964)6 SCR 784 – Relied upon.

       AIR 1961 Guj 93 – Cited with approval.

       (h)Land Acquisition Act, 1894 – Section 17 – So long as it is not established that the acquisition is sought to be made for some collateral purpose, the declaration of Government that it is made for a public purpose is final, conclusive and not open to challenge. (Paras 131, 161 and 163)

       (1971) 1 SCC 671; (1975) 4 SCC 285; (1995)2 SCC 442; (1997) 3 SCC 493 – Relied upon.

       (i)Land Acquisition Act, 1894 – Chapter VII – Merely because the Government allotted a portion of the property to Cooperative Societies, Part VII did not get attracted and the acquisition could not be held invalid. (Para 135)

       (1996) 10 SCC 721 – Relied upon.

       (j)Land Acquisition Act, 1894 – Section 6– In case of colourable exercise of power by the State or fraud on statute, declaration u/s 6 is open to challenge. (Para 165)

       (1963) 2 SCR 774 – Relied upon.

       Facts of the case :

       1.The Government of Andhra Pradesh sought to acquire a large chunk of land in the name of public purpose’ for the purported development of ‘Financial District and Allied Projects’.

       2.A notification under Section 4 of the Act was published in the State Government Gazette on July 17, 2002. The said action was challenged and the validity of notification was questioned in a writ petition in the High Court.

       3.The High Court dismissed the petition following an earlier decision in Writ Petition No. 21712 of 2002 by observing that the writ petition involved similar issues.

       4.Appellants preferred Writ Appeal which was also dismissed.

       Finding of the Court :

       Proceedings initiated by the State for acquisition of land under the Land Acquisition Act, 1894 cannot be said to be illegal, unlawful, unwarranted, mala fide, fraud on statute or having been taken in colourable exercise of power.

       Result : Appeals dismissed.