The provisions of Section 7(1)(e) of the Resettlement of Displaced Persons (Land Acquisition) Act, 1948, which determined compensation based on the market value as on 1st September 1939 with a 40% addition, were ultra vires Section 299(2) of the Government of India Act, 1935, and were not saved by Article 31(5) or 31A of the Constitution.

( 1 ) THIS appeal is directed against an award made by an arbitrator appointed under section 7 of the Resettlement of Displaced Persons (Land Acquisition) Act 60 of 1943, bereinatter to be called the Act. The appeal winch should ordinarily have been heard by a Single Bench, was ordered by the Hon ble the Chief Justice to be placed before a Division Bench for reasons mentioned in his order dated October 26,19137 and that is how it was laid before us.

"the appellant is the owner of certain land in village Basai Darapur which alongwith the land of some other owners, was acquired under Government s notification No F-l (136)48 LSG dated 1st January. 19-19 published in the Delhi State Gazette for the purpose of re-settlement of displaced persons. The project for which the acquisition of land WJ. S made is known as "the Industrial Area Scheme. "as the controversy in this case relates to the quantum of compensation the provision of the Act with which we are concerned is section 7 which lays down the method for determining compensation for the land acquired under the Act. The section provides that where the amount compensation can be fixed by agreement it shall be paid in accordance with that agreement; but where no such agreement can be reached then the Provincial Government shall appoint as arbitrator a person qualified for appointment as a Judge of a High Court. Under clause (d) both the Provincial Government and the person of the proceedings before the arbitrator what in their respective opinions is a fair amount of compensation. Clause (e) with its two provisos lays down the principles in accordance with which the compensation payable under the Act is to be determined. The clause reads :-

"the arbitrator, making his award, shall have due regard to the provisions of sub-section (1) of section 23 of the Land Acquisition Act, 1894 (1 of 1894 ). Provided that the market va!u3 REFERRED TO to in clause first of subsection (1) of section 23 of the said Act shall be deemed to be the market value of such land on the date of publication of the notice under section, or on the first day of September, 1939, with an addition of 40 per cent whichever is less : Provided further that where such land has been held by the owner thereof under a purchase made before the first day of April, 1948, but after the first day of September, 1936, by a registered document, or a decree for pre-emption between the aforesaid date, the compensation shall be the price actually paid by the purchaser or the amount on payment of which he may have acquired the land in the decree for pre-emption as the case may be. "sub-section (3) provides for an appeal form the award to the High Court and makes the decision of the High Court final.

( 2 ) SUB-SECTION (4) lays down that save as provided in this section, nothing in any law for the time being in force shall apply to arbitrations under this section. As there was no agreement between the appellant and the State Government the latter appointed Shri K. S. Sidhu, a Subordinate Judge in Delhi, as arbitrator who made his award on September 23,1960 whereby he fixed the compensation at Rs. 908 as against the sum of Rs. 38330/12 claimed by the appellant.

( 3 ) THE present appeal is for the enhancement of comipensation and has been filed under sub-section (3) of section?. The memorandum of appeal is stamped with a fixed court fee of Rs. 5. 25.

( 4 ) AT the commencement of the arguments a preliminary objection has been taken by the learned counsel for the State on the ground that the memorandum of appeal is deficiently stamped in that the appeal being against an order relating to compensation the memorandum is required to bear ad-valorem Court-fee on the amount represented by the difference between the amount awarded and the amount claimed by the appellant. In order to appreciate the objection it is necessary to look into the various sections of the Court Fees Act. Section 4 deals with fees on documents of the kinds spec