Judgment

HIDAYATULLAH, C.J.I. :- I have read the weighty judgment proposed to be delivered by my brother Shah and I find myself so much in agreement with it that I consider it unnecessary for me to express myself. However, it is proper for me to say a few words in explanation since I was a party to P. Vajravelu Mudaliar s case.- (1965) 1 SCR 614 and the obiter pronouncement of some opinions there. That case was heard with N. B. Jeejeebhoy s case, (1965) 1 SCR . One was a post Constitution (Fourth Amendment) case and the other a pre Constitution case. The judgments in the two cases were delivered on the same day. It appears that the reasoning in the two cases was not kept separate and the whole of the matter was discussed in a case in which it was not necessary for the ultimate conclusion. Because of the close proximity of the decisions, it escaped me that the discussion was in the wrong case and the other merely followed it. My brother Shah has now made the two cases to fall in their proper places. It is certainly out of the question that the adequacy of compensation (apart from compensation which is illusory or proceeds upon principles irrelevant to its determination) should be questioned after the Amendment of the Constitution. The Amendment was expressly made to get over the effect of the earlier cases which had defined compensation as just equivalent. Such a question could not arise after the amendment. I am in agreement that the remarks in P. Vajravelu s case (1965) 1 SCR 614 must be treated as obiter and not binding on us. I am also of the opinion that the Metal Corporation case, (1967) I SCR 255 was wrongly decided and should be overruled.

2. SHAH, J.:- In a writ petition filed by the first respondent Shantilal Mangaldas the High Court of Gujarat has declared Sections 53 and 67 of the Bombay Town Planning Act 27 of 1955, ultra vires, in so far as they authorise the local authority, 2nd respondent in this appeal; to acquire lands under a town planning scheme, and as a corollary to that view has declared invalid the City Wall Improvement Town Planning Scheme No. 5 framed in exercise of the powers conferred under the Act.

3. By Resolution dated April 18,1927, the Borough Municipality of Ahmedabad which was a local authority under the Bombay Town Planning Act 1 of 1915 declared its intention to make a town planning scheme known as the City Wall Improvement Town Planning Scheme" in respect of a specified area. A plot of land No. 221 measuring 18,219 square yards belonging to the first respondent was covered by the scheme. The Provincial Government sanctioned the intention to make the scheme, and a draft scheme was then prepared under which the area of plot No. 221 was reconstituted into two plots- Plot No. 176 measuring 15,403 square yards reserved for the first respondent and Plot No. 178 measuring 2,816 square yards, reserved for the local authority for constructing quarters for municipal employees. The draft scheme was sanctioned by the Government of Bombay on August 7, 1942. On August 13, 1942, the Government of Bombay appointed an arbitrator under Act 1 of 1915 to decide matters set out, in Section 30 of the Act. From time to time several arbitrators were appointed, but apparently little progress was made in the adjudication of matters to be decided by them under the Act.

4. The Bombay Town Planning Act 1 of 1915 was repealed by Section 90 of the Bombay Town Planning Act 27 of 1955 with effect from April 1, 1957. By Section 90 (2) making of any scheme commenced under the repealed Act was to be continued and the provisions of the new Act were to have effect in relation to the publication, declaration of intention, draft scheme, final scheme, sanction, variation, restriction, proceedings, suspension, and recovery to be made or compensation to be given. The arbitrator appointed under Act 1 of 1915 was designated "Town Planning Officer" under Act 27 of 1955, and the proceedings under the City Wall Improvement Town Planning sch