IMPORTANT POINTS
Provisions regarding computation of compensation with regard to both elements under Section 10 of the PMP Act are not invalid on any count.
The definition of “Corporation” is wide enough to take within its sweep entities in private sector as well.
The provisions of the PMP Act do not lacking on any count, except appointment of Competent Authority.

Headnote:(a) Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 – A special enactment – For the purpose of laying pipelines as efficient means of transportation – Therefore only the right of user in the land to lay such pipelines is acquired – Only such lands as lying fallow or being put to agricultural use are to be considered for acquisition of right of user therein – Neither the ownership in respect of the land itself nor the right to occupy or possess that land is taken over permanently and those rights continue to remain with the owner/occupier – Obviously care is taken to cause least possible damage to the holdings of the concerned land-owners. (Para 16, 17)
       Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 – Section 10 – a Taking over right of user amounts to acquisition of one of the facets of property rights which inhere in the owner/occupier – Section 10 compensates the owner/occupier for actual damage, loss or injury sustained by him as a result of the operations carried out in terms of Section 4, Section 7 or Section 8 – Additional compensation @ 10% of the market value of the land, independent of actual loss, is given to the owner/occupier for taking over the right of user to lay the pipelines – Principles of compensation are reasonable and cannot in any way be termed as illusory. (Para 19, 20)
       (1995) Suppl 1 SCC 596 – Relied upon
       1984 SCR (2) 693 : (1984) 2 SCC 337 – Distinguished
       (b) Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 – Section 10 – Compensation arrived at by consent and determined at Rs.181/- per sq.mtr. for lands other than those falling in industrial zone and in respect of those falling in industrial zone, the compensation was at Rs.201/- per sq.mtr. – Provisional compensation @ Rs.300/-per sq.mtr. deposited with the competent authority – Compensation cannot be called inadequate or illusory on any count. (Para 21)
       (c) Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 – Section 2(b) – Laying of pipeline for transportation of petroleum and natural gas – Activity of public interest – Such activity needs participation by private entities – Definition of ‘Corporation’ in section 2(b) being wide enough cannot be given a restricted meaning. (Para 24)
       (d) Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 – Section 2(a) – Competent Authority – Has wide ranging powers u/s 5, 6 and 10 – He is required to deal with variety of civil rights of the interested persons and issues pertaining to compensation – Act and Rules do not pay down qualifications or process of appointment of Competent Authority – Observed that the Competent Authority must also be someone who is holding or has held a Judicial Office not lower in rank than that of a Subordinate Judge or is a trained legal mind – These observations, however, made prospective. (Para 24, 25, 26)
       (2011) 10 SCC 203 – Relied upon
       Facts of the case:
       In exercise of the powers conferred by Section 3 of the PMP Act, the Central Government by Notification published on 07.01.2006 in the Gazette of India declared its intention to acquire the right of user in respect of certain lands.
       The appellant No.1 along with his brother is said to have purchased land admeasuring 50,691 sq.mtrs. from Block Nos. 342 and 364 and sold individual plots from that land to 68 persons including appellant Nos.2 to 18 in said appeal.
       After considering the objections and hearing those who were present including appellant No.1 Laljibhai, the Competent Authority forwarded its Report dated 7.08.2007 to the Central Government. The report indicates that the Competent Authority had held meetings with the owners/occupiers as well as the representatives of RGTIL. The report further shows that the average rate at which the lands in village Gothan were sold during the years 2002-2005 was Rs.13.40 per sq.mtr. The compensation determined by consent was Rs.181/-per sq.mtr. including damages under Section 10(1) for lands other than those falling in industrial zone. For those lands falling in industrial zone, the compensation was increased to the level of Rs.201/-per sq.mtr. by consent. Ninety percent of this compensation was paid in advance.
       In the meantime, District Panchayat Office, Revenue Branch, Surat had accorded permission for conversion of certain lands including Block Nos.342 and 364 of village Gothan to non-agricultural use for the industrial purposes. The steps to seek such permission were taken and the recommendations in that behalf were made after the publication of the aforesaid Notification on 7.01.2006 under PMP Act.
       Government of India directed that the right of user in respect of land mentioned in said Notification dated 17.11.2007 shall stand vested in M/s Reliance Gas Transportation Infrastructure Ltd. free from all encumbrances.
       In the physical verification of Block Nos.342 and 364 carried out in January, 2008, it was seen that some of the owners had commenced construction activities. A communication was therefore addressed by the Competent Authority on 08.01.2008 to the District Development Officer, Surat annexing Notifications issued under Sections 3 and 6 of the PMP Act. Around this time the owners/occupiers of Block Nos.331, 342 and 364 filed Special Civil Application Nos.824-898 of 2008 and Nos.899-966 of 2008 before the High Court of Gujarat seeking declaration that RGTIL had no authority to enter the lands of said owners/occupiers and that it be accordingly restrained. Notices were issued in the aforesaid Special Civil Applications on 04.02.2008 and according to the respondents therein, it was only then it came to their knowledge that non-agricultural permissions were granted on 03.03.1982 in respect of Block No.331 and on 29.03.2007 in respect of Block Nos.342 and 364. RGTIL challenged these non-agricultural permissions by filing Special Civil Application Nos.2252 of 2008 and 3380 of 2008. The High Court by its interim orders dated 06.02.2008 in Special Civil Application No.2252 of 2008 and 21.02.2008 in Special Civil Application No.3380 of 2008 stayed the operation of non-agricultural permissions in respect of aforesaid Block Nos.342, 364 and 331. These interim orders as well as the orders refusing interim relief in Special Civil Application Nos.8992 and 996 of 2008 preferred by the owners/occupiers themselves, were challenged by filing Letters Patent Appeals. In those appeals, the Division Bench of the High Court permitted RGTIL who had by then started laying the pipelines to cover the ditches and to produce the memorandum to that effect in Special Civil Application Nos.899-966 of 2008 and in 2252 of 2008.
       The owners/occupiers of Block Nos.342 and 364 also preferred Special Civil Application No.5107 of 2008 challenging the Notification issued by the Central Government under Section 6 of the PMP Act. High Court held that the balance of convenience was in favour of RGTIL and as such the prayers for interim relief by the owners/occupiers were rejected. The High Court recorded the statement of the Counsel who appeared for RGTIL that it would deposit with the Competent Authority provisional compensation @ Rs.300/-per sq.mtr. for the lands including constructions thereon. Accordingly provisional compensation at the aforesaid rate was deposited by RGTIL with the Competent Authority.
       Thereafter, number of petitioners namely 70 from Special Civil Application No.5107 of 2008, 150 from Special Civil Application No.4321 of 2008, 75 from Special Civil Application Nos.824-853 of 2008 and 68 from Special Civil Application Nos.899-916 of 2008 withdrew their challenge, leaving the remaining petitioners to contest the matter. The Division Bench of the High Court disposed of aforesaid Special Civil Application Nos.824-853, 899-966, 5107 and 4321 of 2008 filed by the owners/occupiers and Special Civil Application Nos.2252 and 3380 of 2008 filed by RGTIL with a direction that if the petitioners are aggrieved they can approach the concerned District Judge claiming compensation and obtain appropriate orders in accordance with law.
       Finding of the Court:
       Provisions regarding computation of compensation with regard to both elements under Section 10 of the PMP Act are not invalid on any count.
       The definition of “Corporation” is wide enough to take within its sweep entities in private sector as well.
       The provisions of the PMP Act do not lacking on any count, except appointment of Competent Authority.
       Result: Appeals disposed of.

JUDGMENT :

Uday Umesh Lalit, J.

1. Leave granted. These appeals take exception to the common judgment and order dated 13.07.2009 passed by the High Court of Gujarat at Ahmedabad in Special Civil Application Nos.5107 of 2008, 4321 of 2008, 824-853 of 2008 and 899-916 of 2008. Since all these appeals raise identical issues, they are dealt with and disposed of by this common judgment.

2. The Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 (herein referred to as the “PMP Act”) was enacted by Parliament to provide for the acquisition of right of user in land for laying pipelines for the transport of petroleum and minerals and for incidental matters, with following Statement of Objects and Reasons :-

“As a result of the implementation of plans for the development of petroleum resources in the country, it is anticipated that in the next few years there will be a substantial increase in the production of crude oil, natural gas and petroleum products by the public sector oilfields and refineries in India. It has therefore become necessary to lay petroleum pipelines in the country to serve as an efficient and cheap means of transportation and distribution of petroleum and petroleum products.

2. Although land can be acquired outright for laying such pipelines under the Land Acquisition Act, 1894 the procedure for such acquisition is long-drawn and costly. Since the petroleum will be laid underground outright acquisition of land is not necessary. Therefore, in the case of these pipelines it is considered sufficient to acquire the mere right of user in the land for laying and maintaining the pipelines. The Bill seeks to achieve the above purpose.

3. The main features of the Bill are–

(i) No right of user of land can be acquired for the purpose of laying pipelines unless the Central Government declares its intention by Notification in the Official Gazette, and unless objections, if any, filed within twenty-one days of that Notification are disposed of by the competent authority.

(ii) When final declaration about acquisition is made the right to use land for the purpose of laying pipelines will vest in the Central Government, State Government or the corporation, as the case may be but notwithstanding such acquisition, the owner or occupier of the land shall be entitled to use the land for the purpose for which such land was put to use immediately before the declaration by the Central Government. But after the date of acquisition he shall not construct any building or any other structure or construct or excavate any tank, well, reservoir or dam or plant any tree, on that land.

(iii) Compensation for the damage, loss or injury sustained by any person interested in the land shall be payable to such person. Besides this, compensation calculated at ten per cent of the market value of the land on the date of the preliminary Notification is also payable to the owner and to any other person whose right of enjoyment in the land has been affected by reason of the acquisition. The compensation in both cases is to be determined by the competent authority in the first instance and an appeal lies from its decision to the District Judge.”

3. Section 2 of the PMP Act defines certain expressions. In terms of Section 3, the Central Government is empowered to acquire the right of user in any land. Under Section 4, it is lawful for any authorized person to enter upon and cause survey in respect of such land. Under Section 5, any person interested in the land can object to the laying of the pipelines under the land. The objections so preferred are to be dealt with by the Competent Authority who would then make a report for the decision of the Central Government. Under Section 6 if the Central Government is satisfied that the land is required for laying any pipeline for transport of petroleum or any mineral, it may declare so by Notification in the Official Gazette, whereafter the right of user shall vest absolutely in the Central Governme

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2016 Supreme(SC) 796

Cases Referred (2)