Supreme Court of India
Kolkata Municipal Corporation vs Bimal Kumar Shah on 16 May, 2024
Author: Pamidighantam Sri Narasimha
Bench: Aravind Kumar, Pamidighantam Sri Narasimha
2024 INSC 435 REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 6466 OF 2024
ARISING OUT OF SLP (C) NO. 4504 OF 2021
KOLKATA MUNICIPAL CORPORATION & ANR. ...APPELLANTS
VERSUS
BIMAL KUMAR SHAH & ORS. …RESPONDENTS
TABLE OF CONTENTS
Introduction .................................................................. 1
Facts. ............................................................................ 2
Submission of Counsels .................................................. 7
Scheme of the Act .......................................................... 8
The Right to property: A net of intersecting rights ........ 15
The Right to notice .........................................................19
The Right to be heard ......................................................20
The Right to a reasoned decision .....................................21
The Duty to acquire only for public purpose .....................22
The Right of restitution or fair compensation ..................23
The Right to an efficient and expeditious process ............24
The Right of conclusion. ..................................................26
Conclusions ................................................................. 28
Signature Not Verified
Digitally signed by
Indu Marwah
Date: 2024.05.16
18:14:28 IST
Reason:
JUDGMENT
PAMIDIGHANTAM SRI NARASIMHA, J.
1. Leave granted.
Introduction: The Kolkata Municipal Corporation claims to have
acquired the property of respondent no. 1 in exercise of powers
under Section 352 of the Kolkata Municipal Corporation Act, 1980.
A single Judge and the Division Bench of the High Court have
concurrently held that there is no such power of compulsory
acquisition of immovable property under Section 352. While
upholding the decision of the High Court, we have given our
additional reasons by interpreting the text and the context in which
Section 352 is placed in the Act. Rejecting the alternative argument
of the appellant-Corporation that there is also a provision for
compensation under Section 363 of the Act when land is acquired
under Section 352, we have examined the constitutional position
of acquisition of immovable property whereunder the mere
presence of power to acquire coupled with a provision for payment
of fair compensation by itself is not sufficient for a valid
acquisition. Interpreting “authority of law” in Article 300A of the
Constitution, we have held that a minimum content of a
constitutional right to property comprises of seven sub-rights or
1
procedures such as the right to notice, hearing, reasons for the
decision, to acquire only for public purpose, fair compensation,
efficient conduct of the procedure within timelines and finally the
conclusion. These sub-rights have synchronously formed part of
our laws and have attained judicial recognition. Therefore, as
Section 352 does not provide for these sub-rights or procedures, it
can never be a valid power of acquisition. Before we deal with the
submissions and analyse the provisions, we will first narrate the
necessary facts.
2. Facts: The property in question, Premises No. 106C,
situated at Narikeldanga North Road, Kolkata – 700011 1,
belongs to Mr. Birinchi Bihari Shah 2 having succeeded it
through a deed of settlement executed by his father. As Birinchi
Shah was minor at the time when his father passed away, his
elder brother managed and administered the Property and, in
that process, he also let out the premises admeasuring 2 bighas
18 kathas 6 chitaks and 40 square feet in favour of one M/s
Arora Film Corporation. Upon attaining majority, the Property
was mutated in the name of Birinchi Shah in the assessment
book of the appellant-Corporation. It is affirmatively stated that
1 Hereinafter, referred to as the “Property”.
2 Hereinafter, referred to as “Birinchi Shah”.
2
all municipal dues including taxes with respect to the Property
were paid regularly. It is also stated that the appellant-
Corporation acknowledged the same and by its letter dated
07.04.2000 admitting that there are no outstanding dues with
respect to property tax.
3. In the year 2009, when an attempt was made by the
appellant-Corporation to forcefully enter and occupy the
Property, Birinchi Shah filed a writ petition being W.P. No. 126
of 2009 before the High Court seeking a restraint order against
the appellant-Corporation.
4. As there was no real contest about the title in the Property
and the appellant-Corporation having not filed any affidavit-in-
opposition, the High Court disposed of the writ petition by an
order dated 17.09.2009 directing that the appellant-
Corporation must hold an enquiry about the encroachments.
The High Court further directed the appellant-Corporation not
to make any construction over the Property.
5. In July 2010, Birinchi Shah received information that the
appellant-Corporation had deleted his name from the category
of owner and had inserted its own name in the official records.
Aggrieved, he approached the High Court by filing a writ petition
3
bearing W.P. No. 981 of 2010, not only for correction of the
entries but also to restrain the appellant-Corporation from
interfering with his peaceful possession over the Property. What
happened in this writ petition is of seminal importance. The
learned single Judge, by an order dated 08.01.2015, recorded
the statement of the appellant-Corporation that they are unable
to controvert the averments made in the writ petition with
respect to title and ownership of the Property. The writ petition
was disposed of restraining the appellant-Corporation from
interfering with the possession of Birinchi Shah and also
injuncted them from giving effect to the wrongful recording of
its name in the official records. The appellant-Corporation was
also directed to remove its men and material from the Property
within two weeks from the date of the said order. The specific
finding of the High Court that the appellant-Corporation could
not establish its right and the title in the Property is significant.
6. Dissatisfied, the appellant-Corporation filed a writ appeal
bearing A.P.O. No. 51 of 2015 against the order of the single
Judge and contended that their affidavit-in-opposition could
not be filed before the Single Judge as the records were
misplaced. It is more or less an admitted fact that a plea of
4
acquisition was taken for the first time before the Division
Bench, and this seems to be the reason for the Division Bench
to remand the matter back to the single Judge after imposing a
cost of Rs. 50,000/- on the appellant-Corporation. After
remand, the appellant-Corporation filed an affidavit-in-
opposition before the single Judge claiming that the land was
acquired. In view of new developments, Birinchi Shah sought
permission to withdraw the pending writ petition with the
liberty to file a fresh writ petition. The High Court permitted this
by an order dated 11.08.2016.
7. Accordingly, Writ Petition No. 930 of 2016 was filed by the
respondent no. 1, the executor to the estate of Birinchi Shah,
inter alia, seeking an order quashing the alleged acquisition as
illegal and to restore their name as owners in the official
records.
8. The learned single Judge of the High Court, allowing the
writ petition by order dated 14.09.2017, formulated two
questions. The first question relates to the maintainability of
the writ petition, which was answered in the affirmative. As
there is no contest to this issue, we will not deal with it. The
second issue relates to the legality and validity of acquisition of
5
the Property in exercise of power under Section 352 of the
Kolkata Municipal Corporation Act, 1980 3. Answering the
second question, the learned single Judge held that the
appellant-Corporation purported to acquire the Property under
Section 352(a) of the Act when there is no power of compulsory
acquisition therein. The learned single Judge therefore quashed
and set-aside the alleged action of acquisition.
9. The appellant-Corporation as well as the respondent no. 1
assailed the order of learned single Judge in writ appeals
bearing APO No. 523 of 2017 and APO No. 210 of 2018,
respectively.
10. The Division Bench of the High Court, by the judgment
impugned herein, affirmed the order of the Single Judge and
accordingly, disposed of the appeals with a direction that the
appellant-Corporation may initiate acquisition proceedings for
the Property under Section 536 or 537 of the Act, within five
months, or in the alternative, restore the name of the last
recorded owner as the owner of the Property.
3 Hereinafter, referred to as the “Act”.
6
11. It is against this judgment and order of the Division Bench
of the High Court, that the appellant-Corporation is in appeal
before us.
12. Submission of Counsels: Mr. Jaideep Gupta, learned
senior counsel, representing the appellant-Corporation, has
submitted that the appellant-Corporation has the requisite
statutory power to acquire a property under Section 352 of the
Act for the purposes of constructing a park, as is the case here.
He has referred to Section 363 of the Act provisioning
compensation for acquisitions made under Section 352 of the
Act and submitted that acquisition under this chapter is
therefore complete and stands on its own footing. He contended
that the single and division benches of the High Court erred in
concluding that Section 537 of the Act is the only provision for
acquisition. Relying on State of Kerala v. T.M. Peter 4, he would
submit that for differential schemes and purposes of
acquisition, different compensation structures will not violate
Article 14 of the Constitution. On the same point, he also relied
on the decisions of this Court in Girnar Traders (3) v. State of
4 (1980) 3 SCC 554.
7
Maharashtra 5, and Bankatlal v. Special Land Acquisition
Officer 6.
13. Mr. Mukul Rohatgi and Mr. Huzefa Ahmadi, learned senior
counsels, appearing for the respondents, while supporting the
judgment of the High Court, impugned herein, submitted that the
power of acquisition is only in Section 537 of the Act and that
invocation of Section 352 read with Section 363 is illegal and
violative of Article 300A of the Constitution. In support of their
submissions, they relied on the judgment of this Court in Nagpur
Improvement Trust v. Vithal Rao 7.
14. Scheme of the Act: The Kolkata Municipal Corporation Act,
1980 extends to 636 Sections, followed by 9 Schedules. It has IX
Parts, of which we are concerned only with Part VI of which
Chapter XXI – relating to Streets and Public Places and Part VIII of
which Chapter XXXIII – relating to Acquisition and Disposal of
Property. As the appellant-Corporation invoked Section 352 of the
Act to acquire the Property for the purpose of opening a park and
ward office, we need to examine the provision. Section 352 of the
Act provides as under:
5 (2011) 3 SCC 1.
6 (2014) 15 SCC 116.
7 (1973) 1 SCC 500.
8
“Section 352:- Power to acquire lands and
buildings for public streets and for public
parking places:– The Municipal Commissioner may,
subject to the other provisions of this Act –
(a) acquire any land required for the purpose of
opening, widening, extending or otherwise improving
any public street, square, park or garden or of
making a new one, together with any building
standing upon such land;
(b) acquire, in relation to any land or building as
aforesaid, such land with building thereon outside
the regular line or the projected regular line of such
public street;
(c) acquire any land for the purpose of laying out or
making a public parking place.”
15. The appellant-Corporation has also relied on Section 363 of
the Act relating to payment of compensation. The said provision is
as under:
“Section 363-Compensation to be paid:– (1)
Compensation shall be paid by the Corporation to the
owner of any building or land acquired for a public
street, square, park or garden under the provisions of
this Chapter:
Provided that any increase or decrease in the value
of the remainder of the property, of which building or
the land so acquired formed part, likely to accrue
from the setting back to the regular line of a public
street, shall be taken into consideration in
determining the amount of such compensation.
(2) If any additional land, which will be included in
the premises of any person permitted or required by
an order under sub-section (2) of section 360 to set
forward a building to the regular line of a public
street, belongs to the Corporation, such order shall be
a sufficient conveyance to the owner of such land;
and the price to be paid to the Corporation by the
owner for such additional land and the other terms
9
and conditions of the conveyance shall be set forth in
such order.
(3) The Corporation shall pay compensation in respect
of land or building acquired under this Chapter at the
following scale:
(i)….
(ii)….”
16. A close examination of the text of Section 352 of the Act
coupled with the context with respect to the placement of the
section in the Act, clarifies the purpose and object of the
provision. The text of Section 352 of the Act provides that the
Municipal Commissioner may acquire any land required for the
purpose of opening, widening, extending, etc. of a street, square,
park, etc. The purpose of this provision is to declare that if the
Municipal Commissioner is of the view that any land is required
for the purpose of opening a street, park, etc., such a land may
be acquired. Once the Municipal Commissioner takes the
decision to acquire a piece of land, what would then be the
process of acquisition is not provided in Section 352. It is provided
in Section 535 occurring in Chapter XXXIII of Part VIII of the Act
which relates to ‘Acquisition of Property’.
17. Before we deal with the Section 535, it is sufficient to
conclude that Section 352 merely contemplates the power and
10
duty of the Municipal Commissioner to identify the land intended
for opening of a street, park etc., and once that decision is taken,
the Municipal Commissioner would take steps to acquire such a
property, for a public purpose.
18. The context in which Section 352 is located in Chapter XXI
of Part VI of the Act relating to ‘streets for public place’, also makes
the position clear that this provision relates to vesting of public
street, squares, parks and gardens in the appellant-Corporation
but does not provide for the power of acquisition. In the following
paragraph, we have explained how the text and the context of the
expression, ‘The Municipal Commissioner may acquire’ in Section
352 is not at all the power of acquisition.
19. Upon arriving at a decision to acquire any land for the
purpose of opening a street, square, park, etc., under Section 352,
the Municipal Commissioner will then apply to the Government
under Section 537 of the Act to initiate the process of acquisition.
Section 537 is located in Chapter XXXIII Part VIII of the Act relating
to ‘Acquisition of Property’. This Chapter commences with Section
535 which specifically provides that the appellant-Corporation
shall have the power to acquire and hold immovable property. It is
followed by the power to acquire properties through an agreement
11
under Section 536 of the Act or in the alternative, through
compulsory acquisition of immovable property as provided in
Section 537 of the Act.
20. The position is thus, clear. Upon application of the Municipal
Commissioner under Section 537 for the acquisition of land for
opening of a street, square, park etc., the Government may order
proceedings to be taken for acquiring land on behalf of the
appellant-Corporation as if the land is needed for a public purpose
within the meaning of the Land Acquisition Act, 1894.
21. Sections 535, 536 and 537 of the Act are extracted
hereinbelow for ready reference:
“Section 535. Acquisition of property. – The
Corporation shall, for the purposes of this Act, have
power to acquire and hold movable and immovable
property or any interest therein, whether within or
outside the limits of Kolkata.
Section 536. Acquisition of immovable property
by agreement.—
(1) Whenever it is provided in this Act that the
Municipal Commissioner may acquire, or whenever
it is necessary or expedient for any purpose of this
Act that the Municipal Commissioner shall acquire,
any immovable property, such property may be
acquired by the Municipal Commissioner on behalf
of the Corporation by agreement on such terms and
at such rates or prices or at rates or prices not
exceeding such maxima as may be approved by the
Mayor-in-Council either generally for any class of
cases or specially in any particular case.
12
(2) Whenever, under any provision of this Act, the
Municipal Commissioner is authorised to agree to
pay the whole or any portion of the expenses of
acquiring any immovable property, he shall do so on
such terms at such rates or prices or at rates or
prices not exceeding such maxima as may be
approved by the Mayor-in-Council either generally or
in particular as aforesaid.
(3) The Municipal Commissioner may on behalf of
the Corporation acquire by agreement any easement
affecting any immovable property vested in the
Corporation and the provisions of sub-sections (1)
and (2) shall apply to such acquisition.
Section 537. Procedure when immovable
property cannot be acquired by agreement. – (1)
Whenever the Municipal Commissioner is unable
under section 536 to acquire by agreement any
immovable property or any easement affecting any
immovable property vested in the Corporation or
whenever any immovable property or any easement
affecting any immovable property vested in the
Corporation is required for the purpose of this Act,
the State Government may, in its discretion, upon
application of the Municipal Commissioner, made
with the approval of the Mayor-in-Council and
subject to other provisions of this Act, order
proceedings to be taken for acquiring the same on
behalf of the Corporation, as if such property or
easement were land needed for public purpose
within the meaning of the Land Acquisition Act,
1894 (I of 1894)
(2)…..
(3) For the purpose of acquisition of immovable
property under this section, the Land Acquisition
Act, 1894, shall be subject to the amendment that
the market value of any land or building to be
acquired shall be deemed, for the purpose of sub-
section (1) of section 23 of the Act, to be the market-
value determined according to the disposition of
13
such immovable property at the date of declaration
under sub-section (1) of section 4 thereof in respect
of such immovable property.
(4) The amount of compensation awarded and all
other charges incurred in the acquisition of any such
property shall, subject to all other provisions of this
Act, be forthwith paid by the Municipal
Commissioner and thereupon such property shall
vest in the Corporation.”
22. The scheme of the Act makes it clear that Section 352
empowers the Municipal Commissioner to identify the land
required for the purpose of opening of public street, square, park,
etc. and under Section 537, the Municipal Commissioner has to
apply to the Government to compulsorily acquire the land. Upon
such an application, the Government may, in its own discretion,
order proceedings to be taken for acquiring the land. Section 352
is therefore, not the power of acquisition. We, therefore, reject the
submission on behalf of the appellant-Corporation that Section
352 enables the Municipal Commissioner to acquire land.
23. We will now deal with the other submission of Mr. Jaideep
Gupta that there is also a provision for compensation under
Section 363 where land is acquired under Section 352. In so far as
Section 363 relating to payment of compensation is concerned, the
High Court has clarified that this provision relates to payment of
14
compensation upon an agreement and not for compulsory
acquisition. We are in agreement with this finding of the High
Court.
24. The Right to property: A net of intersecting rights: There
is yet another aspect of the matter. Under our constitutional
scheme, compliance with a fair procedure of law before depriving
any person of his immovable property is well entrenched. We are
examining this issue in the context of Section 352 of the Act which
is bereft of any procedure whatsoever before compulsorily
acquiring private property. Again, assuming that Section 363 of
the Act provides for compensation, compulsory acquisition will still
be unconstitutional if proper procedure is not established or
followed before depriving a person of their right to property. We
find it compelling to clarify that a rather undue emphasis is laid
on provisions of compensation to justify the power of compulsory
acquisition, as if compensation by itself is the complete procedure
for a valid acquisition.
25. While it is true that after the 44th Constitutional
Amendment 8, the right to property drifted from Part III to Part XII
of the Constitution, there continues to be a potent safety net
8 Constitution (Forty-Fourth Amendment) Act, 1978.
15
against arbitrary acquisitions, hasty decision-making and unfair
redressal mechanisms. Despite its spatial placement, Article
300A 9 which declares that “no person shall be deprived of his
property save by authority of law” has been characterised both as
a constitutional and also a human right 10. To assume that
constitutional protection gets constricted to the mandate of a fair
compensation would be a disingenuous reading of the text and,
shall we say, offensive to the egalitarian spirit of the Constitution.
26. The constitutional discourse on compulsory acquisitions, has
hitherto, rooted itself within the ‘power of eminent domain’. Even
within that articulation, the twin conditions of the acquisition
being for a public purpose and subjecting the divestiture to the
payment of compensation in lieu of acquisition were mandated 11.
Although not explicitly contained in Article 300A, these twin
requirements have been read in and inferred as necessary
conditions for compulsory deprivation to afford protection to the
individuals who are being divested of property12. A post-colonial
reading of the Constitution cannot limit itself to these components
9 300A of the Constitution: “Persons not to be deprived of property save by authority of law. –
No person shall be deprived of his property save by authority of law.”
10 Lachhman Dass v. Jagat Ram, (2007) 10 SCC 448; Vidya Devi v. State of Himachal Pradesh,
(2020) 2 SCC 569.
11 State of Bihar v. Maharajadhiraja Sir Kameshwar Singh of Darbhanga, (1952) 1 SCC 528.
12 Hindustan Petroleum Corporation Ltd v. Darius Shapur Chenai, (2005) 7 SCC 627; K.T.
Plantation Pvt Ltd v. State of Karnataka, (2011) 9 SCC 1.
16
alone. The binary reading of the constitutional right to property
must give way to more meaningful renditions, where the larger
right to property is seen as comprising intersecting sub-rights,
each with a distinct character but interconnected to constitute the
whole. These sub-rights weave themselves into each other, and as
a consequence, State action or the legislation that results in the
deprivation of private property must be measured against this
constitutional net as a whole, and not just one or many of its
strands.
27. What then are these sub-rights or strands of this swadeshi
constitutional fabric constituting the right to property? Seven such
sub-rights can be identified, albeit non-exhaustive. These are:
i) duty of the State to inform the person that it intends to acquire
his property – the right to notice, ii) the duty of the State to hear
objections to the acquisition – the right to be heard, iii) the duty of
the State to inform the person of its decision to acquire – the right
to a reasoned decision, iv) the duty of the State to demonstrate that
the acquisition is for public purpose – the duty to acquire only for
public purpose, v) the duty of the State to restitute and rehabilitate
– the right of restitution or fair compensation, vi) the duty of the
State to conduct the process of acquisition efficiently and within
17
prescribed timelines of the proceedings – the right to an efficientand expeditious process, and vii) final conclusion of the
proceedings leading to vesting – the right of conclusion.
28. These seven rights are foundational components of a law that
is tune with Article 300A, and the absence of one of these or some
of them would render the law susceptible to challenge. The
judgment of this Court in K.T. Plantations (supra)13 declares that
the law envisaged under Article 300A must be in line with the
overarching principles of rule of law, and must be just, fair, and
reasonable. It is, of course, precedentially sound to describe some
of these sub-rights as ‘procedural’, a nomenclature that often
tends to undermine the inherent worth of these safeguards. These
seven sub-rights may be procedures, but they do constitute the
real content of the right to property under Article 300A, non-
compliance of these will amount to violation of the right, being
without the authority of law.
29. These sub-rights of procedure have been synchronously
incorporated in laws concerning compulsory acquisition and are
also recognised by our constitutional courts while reviewing
administrative actions for compulsory acquisition of private
13 K.T. Plantation Pvt. Ltd. v. State of Karnataka, (2011) 9 SCC 1.
18
property. The following will demonstrate how these seven
principles have seamlessly become an integral part of our Union
and State statutes concerning acquisition and also the
constitutional and administrative law culture that our courts have
evolved from time to time.
30. Following are the seven principles:
30.1. The Right to notice: (i) A prior notice informing the bearer
of the right that the State intends to deprive them of the right to
property is a right in itself; a linear extension of the right to know
embedded in Article 19(1)(a). The Constitution does not
contemplate acquisition by ambush. The notice to acquire must be
clear, cogent and meaningful. Some of the statutes reflect this
right.
(ii) Section 4 of the Land Acquisition Act, 1894, Section 3(1) of the
Requisitioning and Acquisition of Immovable Property Act, 1952,
Section 11 of the Right to Fair Compensation and Transparency in
Land Acquisition, Rehabilitation and Resettlement Act, 2013, and
Section 3A of the National Highways Act, 1956 are examples of
such statutory incorporation of the right to notice before initiation
of the land acquisition proceedings.
19
(iii) In a large number of decisions, our constitutional courts have
independently recognised the right to notice before any process of
acquisition is commenced 14.
30.2. The Right to be heard: (i) Following the right to a
meaningful and effective prior notice of acquisition, is the right of
the property-bearer to communicate his objections and concerns
to the authority acquiring the property. This right to be heard
against the proposed acquisition must be meaningful and not a
sham.
(ii) Section 5A of the Land Acquisition Act, 1894, Section 3(1) of the
Requisitioning and Acquisition of Immovable Property Act, 1952,
Section 15 of the Right to Fair Compensation and Transparency in
Land Acquisition, Rehabilitation and Resettlement Act, 2013, and
Section 3C of the National Highways Act, 1956, are some statutory
embodiments of this right.
14 In Narendrajit Singh v. State of U.P., (1970) 1 SCC 125, it was held that a notification under
Section 4 of the Land Acquisition Act, 1894, even in urgent cases falling under Section 17 of
the Land Acquisition Act, 1894 is the sine qua non of the process of acquisition. In State of
Mysore v. Abdul Razak Sahib, (1973) 3 SCC 196, it was held that a notice under Section 4 of
the Land Acquisition Act, 1894 is necessary for completing the land acquisition process. In
Narinderjit Singh and Ranjit Singh v. State of U.P., (1973) 1 SCC 157, this Court held that the
notice under Section 4 of the Land Acquisition Act, 1894 is mandatory and if no notice is
published, the entire process of land acquisition is vitiated. In Competent Authority v.
Barangore Jute Factory, (2005) 13 SCC 477, this Court held that if the initial notification
under Section 3A of the National Highways Act, 1956 is bad, the entire process which is
followed in pursuance of it is vitiated.
20
(iii) Judicial opinions recognizing the importance of this right are
far too many to reproduce. Suffice to say that that the enquiry in
which a land holder would raise his objection is not a mere
formality 15.
30.3. The Right to a reasoned decision: i) That the authorities
have heard and considered the objections is evidenced only
through a reasoned order. It is incumbent upon the authority to
take an informed decision and communicate the same to the
objector.
(ii) Section 6 of the Land Acquisition Act, 1894, Section 3(2) of the
Requisitioning and Acquisition of Immovable Property Act, 1952,
Section 19 of the Right to Fair Compensation and Transparency in
Land Acquisition, Rehabilitation and Resettlement Act, 2013 and
Section 3D of the National Highways Act, 1956, are the statutory
incorporations of this principle.
15 In Nandeshwar Prasad v. State of U.P., AIR 1964 SC 1217, this Court has held the right
under Section 5A of the Land Acquisition Act, 1894 to be a substantial one and it cannot be
taken away. In Hindustan Petroleum Corpn. Ltd. v. Darius Shapur Chenai, (2005) 7 SCC 627,
this Court has held that the right of submitting objections under Section 5A of the Land
Acquisition Act, 1894 is a valuable right and the hearing given in pursuance of exercise of
this right must not be rendered to a mere formality. In Union of India v. Shiv Raj, (2014) 6
SCC 564, this Court held that the rules of natural justice have been ingrained in the scheme
of Section 5A of the Land Acquisition Act, 1894. In Competent Authority v. Barangore Jute
Factory, (2005) 13 SCC 477, this Court observed that in the process from the initial
notification to the final declaration, objections play a vital road. In Kamal Trading (P) Ltd. v.
State of W.B., (2012) 2 SCC 25, this Court quashed the land acquisition proceedings when a
proper hearing under Section 5A of the Land Acquisition Act, 1894 was not accorded. In Gojer
Bros. (P) Ltd. v. State of W.B., (2013) 16 SCC 660, this Court held quashed the land acquisition
proceedings when it was observed that a mere formality was rendered in the name of a
hearing under Section 5A of the Land Acquisition Act, 1894.
21
(iii) Highlighting the importance of the declaration of the decision
to acquire, the Courts have held that the declaration is mandatory,
failing which, the acquisition proceedings will cease to have
effect 16.
30.4. The Duty to acquire only for public purpose: (i) That the
acquisition must be for a public purpose is inherent and an
important fetter on the discretion of the authorities to acquire. This
requirement, which conditions the purpose of acquisition must
stand to reason with the larger constitutional goals of a welfare
state and distributive justice.
(ii) Sections 4 and 6 of the Land Acquisition Act, 1894, Sections
3(1) and 7(1) of the Requisitioning and Acquisition of Immovable
Property Act, 1952, Sections 2(1), 11(1),15(1)(b) and 19(1) of the
Right to Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement Act, 2013 and Section 3A(1) of the
National Highways Act, 1956 depict the statutory incorporation of
the public purpose requirement of compulsory acquisition.
16 In Mohan Singh v. International Airport Authority of India, (1997) 9 SCC 132, this Court held
that publication of a declaration under Section 6 of the Land Acquisition Act, 1894 is
mandatory. In Project Director, Project Implementation Unit v. P.V. Krishnamoorthy, (2021) 3
SCC 572, this Court held that if a declaration is not published under Section 3D of the
National Highways Act, 1956 then the initial notification and resultantly, the acquisition
proceedings cease to have effect.
22
(iii) The decision of compulsory acquisition of land is subject to
judicial review and the Court will examine and determine whether
the acquisition is related to public purpose. If the court arrives at
a conclusion that that there is no public purpose involved in the
acquisition, the entire process can be set-aside. This Court has
time and again reiterated the importance of the underlying
objective of acquisition of land by the State to be for a public
purpose17.
30.5. The Right of restitution or fair compensation: (i) A
person’s right to hold and enjoy property is an integral part to the
constitutional right under Article 300A. Deprivation or
extinguishment of that right is permissible only upon restitution,
be it in the form of monetary compensation, rehabilitation or other
similar means. Compensation has always been considered to be
an integral part of the process of acquisition.
17 In Somawanti v. State of Punjab, 1962 SCC OnLine SC 23, this Court held that the
Constitution permits acquisition of private land by the State only for a public purpose. The
rationale of taking away private land by the State for a public purpose is that private interest
must give way to public interest as observed by the Court in Daulat Singh Surana v. First
Land Acquisition Collector, (2007) 1 SCC 641. In Union of India v. Jaswant Rai Kochhar, (1996)
3 SCC 491 and D. Hanumanth SA v. State of Karnataka, (2010) 10 SCC 656, this Court held
acquisition proceedings to be valid even if there was a change in the public purpose, so long
as there is a public purpose for which the land is acquired. The importance of the
communication of public purpose as an ingredient of the notification for acquisition was
reiterated by this Court in Munshi Singh v. Union of India, (1973) 2 SCC 337 when acquisition
proceedings were set aside since the public purpose was mentioned as “planned development
of the area” which was observed to be wholly insufficient and conveyed no idea as to the
specific purpose. Similarly, in Madhya Pradesh Housing Board v. Mohd. Shafi, (1992) 2 SCC
168, wherein this Court quashed the acquisition proceedings on the ground that the public
purpose was mentioned as “residential” which was too vague.
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(ii) Section 11 of the Land Acquisition Act, 1894, Sections 8 and 9
of the Requisitioning and Acquisition of Immovable Property Act,
1952, Section 23 of the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and
Resettlement Act, 2013, and Sections 3G and 3H of the National
Highways Act, 1956 are the statutory incorporations of the right to
restitute a person whose land has been compulsorily acquired.
(iii) Our courts have not only considered that compensation is
necessary, but have also held that a fair and reasonable
compensation is the sine qua non for any acquisition process18.
30.6. The Right to an efficient and expeditious process: (i) The
acquisition process is traumatic for more than one reason. The
administrative delays in identifying the land, conducting the
enquiry and evaluating the objections, leading to a final
declaration, consume time and energy. Further, passing of the
award, payment of compensation and taking over the possession
18 In State of U.P. v. Manohar, (2005) 2 SCC 126, this Court held that payment of
compensation is an integral part of the process of land acquisition. In M. Naga Venkata
Lakshmi v. Visakhapatnam Municipal Corpn., (2007) 8 SCC 748, this Court held that wherever
promised, compensation is ought to be paid. In NHAI v. P. Nagaraju, (2022) 15 SCC 1, this
Court held that compensation must be adequate and must be arrived at keeping in mind the
market value of the acquired land. In Vidya Devi v. State of H.P., (2020) 2 SCC 569, this Court
held that even though compensation is not expressly provided for under Article 300A of the
Constitution, it can be inferred therein. In the American jurisprudence, payment of
compensation has been made part of due process (See Sweet v. Rechel [159 US 380 (1895) :
40 L.Ed. 188], Delaware L. & W.R. Co. v. Morristown [276 US 182 (1928) : 72 L.Ed. 523] and
United States v. Caltex (Philippines) [344 US 149 (1952) : 97 L.Ed. 157).
24
are equally time consuming. It is necessary for the administration
to be efficient in concluding the process and within a reasonable
time. This obligation must necessarily form part of Article 300A.
(ii) Sections 5A(1), 6, 11A, and 34 of the Land Acquisition Act,
1894, Sections 6(1A) and 9 of the Requisitioning and Acquisition
of Immovable Property Act, 1952, Sections 4(2), 7(4), 7(5), 11(5),
14, 15(1), 16(1), 19(2), 25, 38(1), 60(4), 64 and 80 of the Right to
Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement Act, 2013 and Sections 3C(1),
3D(3) and 3E(1) of the National Highways Act, 1956, prescribe for
statutory frameworks for the completion of individual steps in the
process of acquisition of land within stipulated timelines.
(iii) On multiple occasions, upon failure to adhere to the timelines
specified in law, the courts have set aside the acquisition
proceedings19.
19 In Roy Estate v. State of Jharkhand, (2009) 12 SCC 194; Union of India v. Mahendra Girji,
(2010) 15 SCC 682 and Union of India v. Mahendra Girji, (2010) 15 SCC 682, this Court has
underscored the importance of following the timelines fixed by the statute. In Mansaram v.
S.P. Pathak, (1984) 1 SCC 125, this Court has held that the powers relevant to the land
acquisition process must be exercised within a reasonable time. In Kerala State Housing
Board v. Ramapriya Hotels (P) Ltd., (1994) 5 SCC 672, this Court has held that if the
concerned legislation does not stipulate the time-frames within which the process or its
components are to be completed, it amounts to a violation of Article 14 and Article 21 of the
Constitution. In Ram Chand v. Union of India, (1994) 1 SCC 44, this Court has acknowledged
the realisation of the Parliament that the authorities are not completing the acquisition
proceedings within a reasonable time and thus, the Parliament has introduced time-limits.
In Ambalal Purshottam v. Ahmedabad Municipal Corpn. (1968) 3 SCR 207, this Court held
that a notification under Section 6 of the Land Acquisition Act, 1894 must be followed by a
proceeding for determination of compensation without any unreasonable delay. In Khadim
Hussain v. State of U.P., (1976) 1 SCC 843, this Court held that excessive intervening delay
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30.7. The Right of conclusion: (i) Upon conclusion of process
of acquisition and payment of compensation, the State takes
possession of the property in normal circumstances. The
culmination of an acquisition process is not in the payment of
compensation, but also in taking over the actual physical
possession of the land. If possession is not taken, acquisition is
not complete. With the taking over of actual possession after the
normal procedures of acquisition, the private holding is divested
and the right, title and interest in the property, along-with
possession is vested in the State. Without final vesting, the State’s,
or its beneficiary’s right, title and interest in the property is
inconclusive and causes lot of difficulties. The obligation to
conclude and complete the process of acquisition is also part of
Article 300A.
ii) Section 16 of the Land Acquisition Act, 1894, Sections 4 and 5
of the Requisitioning and Acquisition of Immovable Property Act,
1952, Sections 37 and 38 of the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and
Resettlement Act, 2013, and Sections 3D and 3E of the National
Highways Act, 1956, statutorily recognise this right of the acquirer.
between notifications under Sections 4 and 6 of the Land Acquisition Act, 1894, keeping the
landowner in suspense throughout, is illegal.
26
iii) This step of taking over of possession has been a matter of great
judicial scrutiny and this Court has endeavoured to construe the
relevant provisions in a way which ensures non-arbitrariness in
this action of the acquirer 20. For that matter, after taking over
possession, the process of land acquisition concludes with the
vesting of the land with the concerned authority. The culmination
of an acquisition process by vesting has been a matter of great
importance. On this aspect, the courts have given a large number
of decisions as to the time, method and manner by which vesting
takes place 21.
20 In State of W.B. v. Vishnunarayan & Associates (P) Ltd., (2002) 4 SCC 134, this Court held
that possession can be resumed by the acquirer only in a manner known to or recognised by
law and it cannot resume possession otherwise than in due course of law. In Jilubhai Nanbhai
Khachar v. State of Gujarat, 1995 Supp (1) SCC 596, this Court held that though eminent
domain is the highest and most exact idea of property remaining in the Government, or in
the aggregate body of the people in their sovereign capacity, even then the right to take
possession of a private property must be exercised in the manner directed by the Constitution
and the laws of the State, since deprivation of property must take place after following the
procedure of law and upon ensuring due process.
21 In Girnar Traders (3) v. State of Maharashtra, (2011) 3 SCC 1, this Court held that under
the Land Acquisition Act, 1894, upon the payment of compensation and taking of possession
of a land so acquired, the land is vested in the State free of encumbrances and the completion
of such vesting of the land in the State amounts to the transfer of title from the owner to the
State by a legal fiction. In P. Chinnanna v. State of A.P., (1994) 5 SCC 486 and Delhi
Development Authority v. Reena Suri, (2016) 12 SCC 649, this Court held that mere passing
of award under the Land Acquisition Act, 1894 will not suffice to vest the land in the State
since taking possession is of utmost importance. In Fruit & Vegetable Merchants Union v.
Delhi Improvement Trust, 1956 SCC OnLine SC 37, this Court held that once the land is
vested in the State, it is vested neither for a limited purpose nor for a limited duration.
Further, in Union of India v. Tarsem Singh, (2019) 9 SCC 304, this Court observed that the
National Highways Act, 1956 has an object of reducing delay in the process of land acquisition
in order to speedily implement projects pertaining to highways. It is in this context that this
Court held that under Section 3D of the National Highways Act, 1956, the land to be acquired
vests in the Union upon the publication of a notification declaring the acquisition, which is
done after the disposal of objections of the land-owner, if any.
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31. The seven principles which we have discussed are integral
to the authority of law enabling compulsory acquisition of
private property. Union and State statutes have adopted these
principles and incorporated them in different forms in the
statutes provisioning compulsory acquisition of immovable
property. The importance of these principles, independent of the
statutory prescription have been recognised by our
constitutional courts and they have become part of our
administrative law jurisprudence.
32. Conclusions: Returning to the legal submissions of the
counsel for the appellant-Corporation, as we have noticed that
Section 352 does not provide for any procedure whatsoever, we
reject the contention that it contemplates the power of
acquisition. We have already held that Section 352 is only
intended to enable the Municipal Commissioner to decide
whether a land is to be acquired for public purpose. The power
of acquisition is in fact vested with the State under Section 537
and it will exercise it, in its own discretion, whenever the
Municipal Commissioner makes an application to that effect. We
have also agreed with the decision of the High Court that Section
363 is not a provision for compensation for compulsory
28
acquisition. In this context, we have also held that a valid power
of acquisition coupled with the provision for fair compensation
by itself would not complete and exhaust the power and process
of acquisition. Prescription of the necessary procedures, before
depriving a person of his property is an integral part of the
‘authority of law’, under Article 300A and, Section 352 of the Act
contemplates no procedure whatsoever.
33. We are not referring to the detailed facts of the case
involving multiple rounds of litigation where the respondents
have taken inconsistent stands about the ownership and
acquisition of the Property. There is no doubt in our mind that
the exercise of the power is illegal, illegitimate and has caused
great difficult to the respondent-land-bearer. It is necessary to
refer to the findings of the learned single Judge that the
appellant-Corporation acted in blatant violation of statutory
provisions, these findings are as follows:
“The facts disclosed by the Corporation in the Affidavit-
in-Opposition evidently shows that the acquisition was
made by invoking Section 352(a) of the said Act by
exercising the power of eminent domain. There was a
doubt in the mind of some of the Municipal Authorities
whether such sovereign power can be exercised by the
Statutory Authority like the Corporation and a legal
opinion was sought by the Chief Municipal Law Officer
from one of the Senior Advocates. The Senior Advocate,
however, doubted over the said exercise of power and29
also highlighted the anomalies in such action. On the
basis of such opinion the Chief Municipal Officer made
the following remark: –
“Doubt has arisen in the past on the question
whether the Municipal Commissioner could under
Section 352(a) of the CMC Act, 1980 straightway
compulsorily acquire any land by giving notice to
owner/occupiers also in contract Newspapers and pay
compensation under Section 363(3) of the Act. The
former Ch. Mpl. Law Officer had referred the question
to Mr. P.K. Ghoah Senior Advocate for his opinion. A
copy of his opinion is placed below for persual. I have
nothing more to add. If in spite of the anomalies in the
statute pointed out by Mr. P.K.Ghosh the Mpl.
Commissioner proceeds to take possession of the land
in question, I have no comment to make. If the
aggrieved party moves the Court, then the Court will
resolve the anomalies.”It is curious to note that despite the same, the then
Mayor put a note that the Corporation may proceed to
acquire the property by invoking powers under Section
352(a) and the note of the Chief Municipal Law Officer
was simply kept in the file. It would further appear
from the subsequent noting of the Chief Municipal Law
Officer put on 08.01.1991 wherein it is noted that the
act is silent as to when the possession is to be taken
either before or after the payment of compensation
under Section 363 and according to him, the possession
can only be taken after the payment of compensation
under Section 363(3) of the said Act. Despite the
aforesaid noting, the Municipal Commissioner passed
an order of acquisition on 18.01.1991 directing to
acquire the subject land under Section 352(a) of the Act
with immediate effect and the possession should also
be taken immediately. There is a serious dispute
whether the possession was in fact taken in terms of
the said order of the Municipal Commissioner or not.
However, it is seen from the notes put on 16.03.1991
that the possession was taken. The fact remains that
no compensation has been paid as yet. The Corporation
has further disclosed a letter allegedly written by the30
recorded owner on 14.11.1991 wherein it is
categorically stated that the possession has not been
taken. Though it appears from the noting that the
possession was taken way back in 1991 but the record
maintained by the Corporation was not altered and/or
corrected and in fact the Corporation continued to
accept the property tax paid by the recorded owner in
respect of the said property. Even in the year 2000, the
Corporation mutated the name of the Birinchi Behari
Shaw and also issued the No Due Certificate to him. It
is only in the year 2010 the Corporation deleted the
name of the said owner and incorporated its name as
owner thereof. Yet, showing the huge outstanding on
account of property tax with interest and penalty in the
letter of intimation issued on 17.07.2010. The
explanation is sought to be offered that there is no
synchronization between the two departments of the
Corporation and a mistake has been committed, which
cannot confer any equity or right in favour of the
Petitioner.
I am unable to persuade myself to agree with such
explanation. For the sake of argument, if it is accepted
that possession was taken way back in 1991, there
was no occasion to accept the property tax for more
than a decade without altering the entries made in the
assessment register.
This Court, therefore, finds that the Corporation
acted blatantly in violation of the statutory provision in
acquiring the property as such acquisition should have
been facilitated by approaching the State under Section
537(1) of the said Act. The entire action concerning the
acquisition of property by invoking Section 352(a) of the
Act is per se illegal, invalid and in clear contravention
to the provisions of the Act and are hereby quashed and
set aside.”
34. In the above analysis, we are of the considered opinion that
the High Court was fully justified in allowing the writ petition
and rejecting the case of the appellant-Corporation acquiring
31
land under Section 352 of the Act. The impugned judgment does
not brook interference on any count.
35. Having considered the matter in detail, we dismiss the
appeal arising out of SLP (C) No. 4504 of 2021 filed by the
appellant-Corporation against the judgment of the High Court
of Calcutta in APO No. 523 of 2017 dated 17.12.2019 with costs
quantified at Rs. 5,00,000/-, to be paid to respondent no. 1
within a period of sixty days from today.
36. Pending application(s), if any, shall be disposed of.
………………………………….J.
[PAMIDIGHANTAM SRI NARASIMHA]
………………………………….J.
[ARAVIND KUMAR]
NEW DELHI;
MAY 16, 2024.
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