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1918 Supreme(SC) 70
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
LORD SHAW OF DUNFERMLINE, SIR JOHN EDGE, MR. AMEER ALI, AND SIR WALTER PHILLIMORE, BART.
RATANLAL CHOONILAL PANALAL - Appellant
Versus
MUNICIPAL COMMISSIONER FOR THE CITY OF BOMBAY - Respondents
On Appeal from the High Court at Bombay.
Decided On : July 26, 1918.
Solicitors for appellant:T. L. Wilson & Co. Solicitors for respondents: Cameron, Kemm & Co.
A municipal order requiring a building to be set forward onto corporation land acts as a conveyance to the owner. Land vested in a street-making authority for street formation only includes land actually used for the street; otherwise, it remains with the municipal corporation.
Headnote:(A) Municipal Act, 1888 - Sections 297, 298, 300, 301 - Improvement Act, 1898 - Sections 1, 41, 42, 45 - Land acquisition and building lines - Set-back and set-forward of buildings - Ownership of land - Conveyance by statutory order - Compensation and interest.
(B) Vesting of land in a street-making authority - Land vested for the purpose of forming a street includes only that ground which is actually used as a street - If a line is changed and a strip of land is not formed into a new street, such land does not vest in the street-making authority and remains the property of the municipal corporation.
(C) Set-forward of buildings - Where a municipal commissioner orders a building to be set forward onto land belonging to the corporation, such order constitutes a sufficient conveyance of the land to the owner.
(D) Compensation and Set-off - Statutory provisions providing for compensation to an owner for loss or damage resulting from a compulsory set-forward order do not imply a right for the authority to receive a price for the land gained by the owner - No right of set-off exists against compensation payable for set-back land. (E) Interest on compensation - Unless otherwise contracted, interest on the unpaid price of land acquired by an authority runs from the date the authority enters into possession of the property.
Facts of the case:
An owner rebuilt premises according to building lines prescribed by municipal authorities. On one frontage, the building was set back, resulting in a claim for compensation. On another frontage, the building was set forward onto land that was previously part of a street. A street-improvement board claimed ownership of this set-forward land and sought ejectment of the owner. The municipal authority argued that the value of the set-forward land should be set off against the compensation due for the set-back land.
Findings of Court:
The set-forward land did not vest in the improvement board because it was not used to form the new street; it remained the property of the municipal corporation. Under the Municipal Act, the order to set forward the building acted as a conveyance of that land to the owner. The law provides for damages to the owner for compulsory set-forward but not for a purchase price to be paid to the authority; therefore, no set-off was permissible. Interest is payable from the date of possession.
Issues: Whether land not used in a final street scheme vests in the street-making authority; whether a set-forward order constitutes a conveyance of land to the property owner; and whether interest on compensation runs from the date of possession.
Ratio Decidendi: The court held that vesting of land in a street-making authority is limited to the land actually used for the street. A set-forward order under the Municipal Act serves as a conveyance of the land to the owner. Since the legislature provided for damages to the owner for compulsory impropriation but not for a price to be paid by the owner, the authority has no right to a set-off. Interest on the price of land runs from the date the authority takes possession.
Result: Appeals allowed; decree for compensation varied to include 6% interest from the date of possession; suit for ejectment dismissed; costs awarded to the appellant.
Legal Category Hierarchy
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property law
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land acquisition
- compensation
- set-back and set-forward
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conveyance
- statutory conveyance
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land acquisition
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administrative law
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municipal law
- building lines
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municipal law
Judgement
Consolidated Appeals from two decrees of the High Court (April 16, 1916), the first affirming a decree, and the second varying a decree, of Davar J. (October 15, 1914).
The consolidated appeals were in two suits in the High Court arising out of the rebuilding of the appellants premises at the corner of Princess Street and Kalbadevi Road, in the city of Bombay. Upon the rebuilding the premises had been set forward in Princess Street and set back in Kalbadevi Road so as to conform with the building lines, and as provided by an order made by the Municipal Commissioner under ss. 298 and 300 of the City of Bombay Municipal Act, 1888.
The first suit was instituted by the mother and guardian of the appellant, who was a minor at that time, against the respondent the Municipal Commissioner to recover compensation in respect of the strip of land covered by the original premises in Kalbadevi Road in front of the building line.
The second suit was instituted by the respondents the Trustees for the Improvement of the City of Bombay against the appellant. The trustees alleged that the land in Princess Street over which the premises had been erected upon the rebuilding wa« their property, and they claimed possession.
The strips of land in question in the two suits are for convenience referred to respectively as the set-back land and the set-forward land.
The suits were heard successively by Davar J. In the first he decreed the appellant compensation at Rs.200 per square yard, but upon the view which he took of the appellants conduct he refused to allow him interest or the costs. In the second suit, to which the respondent Commissioner was joined as a third party, the learned judge held that the set-forward land was vested in the respondent trustees, and that they were entitled to eject the appellant. He made a decree for possession, and dismissed the appellants claim against the respondent Commissioner as third party.
The appellant appealed from the first decree so far as it did not give him interest and costs, and from the whole of the second decree.
The learned judges (the Chief Justice and Batch el or J.) affirmed the first decree, and varied the second decree only by ordering that the appellant should be evicted unless by May 15, 1915, he paid to the respondent trustees compensation at Rs.200 per square yard for the set-forward land.
1918. June 13, 14, 17, 18. P. O. Lawrence K.C. and E. B. Raikes for the appellant. In the first suit the appellant was entitled upon the principles applied under the Lands Clauses Act to interest from the date when the corporation obtained possession of the set-back land. The corporation, not having appealed from the decree for compensation, cannot contend that the claim should have been made in the Small Causes Court. In the second suit the trustees were not entitled to sue in ejectment. The appellant was owner of the land ad medium filum of the street ; the vesting in the corporation under s. 289 of the Municipal Act was merely for the purposes of the Act and did not affect the freehold interest Bombay Corporation v. Great Indian Peninsula Ry. (( 1916) L. R. 43 I. A. 310, 314.) But even if the freehold of the street vested in the corporation, the effect of the notice under s. 41 of Bombay Act IV. of 1898 was merely to vest the land in the trustees for the purposes of that Act Rolh v. Vestry of St. George (( 1880) 14 Ch. D. 785, 797.) ; City of London Land Tax Commissioners v. Central London Ry. ([ 1913] A. C. 364, 379.) Upon the trustees abandoning their street scheme, which was before the appellant commenced to rebuild, the set-forward land, if it ever vested in the trustees, revested in the corporation, or at any rate the trustees ceased to have such ail interest as would support the action. By the order of the corporation under s. 300 the appellant was not only authorized, but required under penalties, to rebuild upon the land. Only the corporation had power to make the set-forward order, an
