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1919 Supreme(SC) 98
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
VISCOUNT FINLAY, LORD SUMNER, AND LORD PARMOOR.
TRUSTEES FOR THE IMPROVEMENT OF CALCUTTA - Appellant
Versus
CHANDRA KANTA GHOSH - Respondents
On Appeal from the High Court at Calcutta.
Decided On : Dec. 16. 1919.
Solicitors for appellants :Morgan, Price & Co. Solicitors for respondent: W. W. Box & Co.
The term "affected" in land acquisition statutes, unless specifically limited, includes land whose value is enhanced by an improvement scheme, permitting compulsory acquisition for recoupment to offset public expenditure.
Headnote:(A) Improvement Act - Sections 39, 41, 42, 69, 78, and 81 - Land Acquisition Act, 1894 - Sections 23 and 49 - Interpretation of "affected" - Power of compulsory acquisition for recoupment - The term "affected" in the context of an improvement scheme should be construed in its ordinary and normal sense, meaning land whose value is either enhanced or diminished by the execution of the scheme. To limit this term to only physical or material affection would render the specific power to acquire "affected" land illusory and redundant if it only covered land already required for the execution of the works.
(B) Recoupment - A statutory board is authorized to acquire land compulsorily for purposes of recoupment, whereby land enhanced in value by a scheme is acquired and sold to ease the burden of public expenditure, provided the interests of the owner are properly protected.
(C) Compulsory Acquisition - Power to acquire land under the provisions of the Land Acquisition Act, 1894, for carrying out any of the purposes of the improvement Act includes the acquisition of land affected in value under the scheme for recoupment purposes.
Facts of the case:
A statutory board framed a scheme for the widening of a road. The board included certain land in the scheme that was not physically required for the widening and was situated 55 feet away from the proposed widened line. The board's intention was to acquire this land because its value would be enhanced by the execution of the scheme, allowing the board to sell it and use the profit as recoupment to offset the cost of the public works. The owner of the land challenged the acquisition, seeking a declaration that the board had no power to acquire land not physically required for the execution of the scheme.
Findings of Court:
The court found that while the land was not required for the actual execution of the road widening under the section governing necessary land, it fell within the scope of land that would be "affected" by the execution of the scheme. The board's action in including the land for recoupment purposes was not a misuse of power but was within the authority granted by the Act.
Issues: Whether the term "affected" in the statutory provision allows for the compulsory acquisition of land whose value is enhanced by an improvement scheme, even if the land is not physically required for the works, and whether such acquisition for recoupment is permissible.
Ratio Decidendi: The court ruled that "affected" must be given its ordinary meaning, encompassing both beneficial and prejudicial changes in value. If the power were limited to physical affection, it would overlap entirely with the power to acquire land required for execution. Therefore, the board can compulsorily acquire land that is enhanced in value to recover costs, as this is a recognized principle of recoupment and falls within the general purposes of the Act.
Result: Appeal allowed.
Appeal from a judgment and decree of the High Court (August 22, 1916) affirming a decree of the first Subordinate Judge of 24 Parganas (August 10, 1915).
The appellants were the Board of Trustees under the Calcutta Improvement Act (Bengal Act V. of 1911). In pursuance of that Act the appellants passed resolutions and framed a scheme for the widening of a road known as Russa Road, in the suburbs of Calcutta ; the scheme was duly notified in the Calcutta Gazette. Amongst the properties to be acquired were certain land and premises in Chaulputty Road belonging to the respondent. This land did not form part of Russa Road as proposed to be widened, but was, at its nearest point, situated 55 feet from the road when widened. The Board of Trustees rejected an objection by the respondent to the acquisition of his land, and sub sequently rejected an application under s. 78 of the Act requesting to know the amount which would be required by the Board for abandoning the acquisition.
The respondent, on April 28, 1914, sued the appellants for a declaration that the appellants had no powers under that Act to acquire the land in question, and for .an injunction and other relief. On May 25, 1914, an interim injunction was made restraining the appellants from proceeding further with the acquisition of the land until the disposal of the suit.
50 Law. Rep. 47 Ind. App. 45 ( 1919- 1920) Trustees for the Improvement v. C handra Kanta Ghosh
151
The appellants by their written statement pleaded, inter alia, that their action had not been in any way mala fide, and that, in their opinion, the land in question was not only required for the execution of the scheme within s. 41 (a) of the Act, but (in the alternative) was also " affected " by it within s. 42 (a) of the above-mentioned Act (Calcutta Improvement Act (Ben. Act V. of 1911), s. 41 “Every improvement scheme shall provide for - (a) the acquisition by the Board of any land which will, in their opinion, be required for the execution of the scheme; ….” Sect. 42 “Any improvement scheme may provide for - (a) the acquisition by the Board of any land, in the area comprised in the scheme, which will, in their opinion, be affected by the execution of the scheme; ….”), and that the steps provided by the Act had been duly taken ; they also contended that it was not open to the respondent to question the scheme since it had been duly sanctioned by the Local Government.
The Subordinate Judge found that the resolutions of the Board did not include the land in the actual widening, and contained no indication of an intention to use it for building-sites or any other purpose mentioned in s. 39 of the Act; consequently the land was not required for the execution of the scheme. He was of opinion that the Act did not provide for the acquisition of land for purposes of recoupment. He consequently made a decree in the respondents favour.
Upon appeal to the High Court the decision was affirmed. The learned judges (Sir Asutosh Mookerjee
J. and Cuming J.) agreed with the view that under the Act land could not be acquired merely for the purpose of recoupment. They pointed out that recoupment was not one of the objects of the Act as stated in its preamble. In their opinion the word " affected " in s. 42 (a) did not mean beneficially or prejudicially affected in value, but only acted upon physically and materially. In their view s. 42 gave no power of compulsory acquisition, and did no more than enable the Board to acquire by private agreement, and any other construction would involve investing the Board with arbitrary powers to interfere with private rights. The proceedings upon the appeal are reported at I. L.
R. 44 C. 219.
1919; Oct. 31 ; Nov. 5, 6, 19. Sir John Simon K.C., Dunne K.C., Sir William Garth K.C. and G. B. MacNair for the appellants. The appellants had power to acquire compulsorily the respondents land under s. 41 of the Calcutta Improvement Act, 1911, but, if not, they had that power under s. 42.
