Bombay High Court
Pimpri Chinchwad New Town ... vs The State Of Maharashtra on 21 November, 2015
Bench: A.S. Oka
ash 1 wp-9525n9528.04
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE SIDE JURISDICTION
WRIT PETITION NO.9525 of 2004
with
WRIT PETITION NO.9528 OF 2004
WITH
CIVIL APPLICATION NO.2397 OF 2015
AND
CIVIL APPLICATION NO.1611 OF 2015
IN
WRIT PETITION NO.9525 OF 2004
WITH
CIVIL APPLICATION NO.2550 OF 2014
ig IN
WRIT PETITION NO.9528 OF 2004
Pimpri Chinchwad new Town Development
Authority, Nigadi, Pune- 411 044. .. Petitioner
Vs
State of Maharashtra and Others. .. Respondents
-
C.A.NO.2397 OF 2015
Kishorkumar Jawaharlal Gulwani and Others. .. Applicants
In the matter between:
Pimpri Chinchwad New Town Development
Authority, Nigadi, Pune- 411 044. .. Petitioner
Vs
The State of Maharashtra and Others. .. Respondents
-
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C.A.NO.1611 OF 2015
Mr. Harishchandra Vishnu Dhotre and Ors. .. Applicants
In the matter between:
Pimpri Chinchwad New Town Development
Authority, Nigadi, Pune- 411 044. .. Petitioner
Vs
The State of Maharashtra and Others. .. Respondents
-
C.A.NO.2550 OF 2014
Sharad Y. Kokane.
ig .. Applicant
In the matter between:
Pimpri Chinchwad New Town Development
Authority, Nigadi, Pune- 411 044. .. Petitioner
Vs
The State of Maharashtra and Others. .. Respondents
--
Shri Vijay D. Patil for the Petitioner in both the Petitions and for the
Respondent No.1 in CA Nos.1611 of 2015, 2397 of 2015 and 2550 of
2014.
Mrs.M.P. Thakur, AGP for the Respondent Nos.1 to 4 in both the
Petitions and for the Respondent Nos.2 to 5 in the Civil Applications.
Shri A.V. Anturkar, Senior Advocate i/b Shri Siddhartha R. Ronghe for
the Respondent No.5 in both the Petitions and for the Respondent No.6
in the Civil Applications.
Shri Madhav J. Jamdar for the Applicants in CA No.1611 of 2015.
Shri Babu M.B. i/b Shri Ganesh Sitaram Bhat for the Applicants in 2397
of 2015.
--
CORAM : A.S. OKA & V.L. ACHLIYA, JJ
DATE ON WHICH SUBMISSIONS WERE HEARD : 21ST OCTOBER 2015
DATE ON WHICH JUDGMENT IS PRONOUNCED: 21ST NOVEMBER 2015
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JUDGMENT ( PER A.S. OKA, J )
FACTUAL MATRIX- Writ Petition No.9525 of 2004
In Writ Petition No.9525 of 2004, the challenge is to the
order dated 21st September 2004 passed by the Second Respondent who
was the then Hon'ble Minister of State of the Revenue Department of
the State Government. The subject matter of the said Writ Petition is
the land bearing Survey No.17/6,25 and 31 (Part) at Village Rahatani,
Taluka Haveli, District-Pune (for short "the said land"). By the
impugned order passed in exercise of the powers under Sub-Section (1)
of Section 48 of the Land Acquisition Act, 1894 (for short "the Land
Acquisition Act"), the Second Respondent directed release of the said
land from the acquisition. The acquisition was for the benefit of the
Petitioner.
2. The Petitioner is a New Town Development Authority
constituted under Sub-Section (2) of Section 113 of the Maharashtra
Regional and Town Planning Act, 1966 ( for short "the MRTP Act").
3. In the year 1962, the State Government decided to develop
an industrial area in the limits of the erstwhile Pimpri Chinchwad
Municipal Council. For that purpose, large agricultural lands were
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acquired. After development of the industrial area, it was decided to
develop Pimpri Chinchwad as a new township area. The State
Government designated an area of approximately 4323 Hectares as the
site of the proposed new town. As stated earlier, the Petitioner was
appointed as the New Town Development Authority for the said area in
exercise of the powers under Sub-Section (2) of Section 113 of the
MRTP Act by a Notification dated 14 th March 1972. The Development
Plan for the area for which the Petitioner was appointed as the New
Town Development Authority was sanctioned on 8 th September 1977.
The said land subject matter of this Petition was notified for the
purposes of acquisition under Sub-Section (1) of Section 4 of the Land
Acquisition Act on 9th March 1970. The award under Section 11 of the
Land Acquisition Act was made on 23rd September 1986. A notice was
issued by the Special Land Acquisition Officer on 11 th May 1999 for
taking over possession of the said land. However, the possession could
not be taken over due to the orders passed in a Civil Suit filed by the
land owner. According to the case of the Petitioner, though the suit was
dismissed in the year 1995, notwithstanding the requests made by the
Petitioner, the Revenue Department did not take steps for placing the
Petitioner in possession of the said land.
4. A letter dated 10th September 2004 issued by the Revenue
Department of the State Government was received by the Petitioner by
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Fax calling upon the Petitioner to remain present on 13 th September
2004 before the Second Respondent with regard to the Application filed
by the Fifth Respondent under Sub-Section (1) of Section 48 of the
Land Acquisition Act. Though a copy of the said Application was
forwarded by Fax, it was not at all legible. The case made out in the
Petition is that on 13th September 2004, a request was made by the
representative of the Petitioner before the Second Respondent for grant
of time to file a reply. It is stated that the Second Respondent did not
grant time and heard the submissions of the Advocate for the Fifth
Respondent. The Petitioner's representative was directed to submit a
reply on 17th September 2004. Accordingly, a reply was filed on 16 th
September 2004. It is contended that though a rejoinder was filed to
the said reply by the Fifth Respondent, a copy thereof was not supplied
to the Petitioner. The case made out in the Petition is that a copy of the
impugned order dated 21st September 2004 was forwarded to the
Petitioner along with a letter dated 20 th October 2004 which was
received by the Petitioner on 26th October 2004. By the impugned
order, the prayer made by the Fifth Respondent for deleting the said
land from the acquisition was accepted. It is pointed out in the Petition
that the programme for filing of nomination papers for the election of
the Maharashtra Legislative Assembly commenced from 15 th September
2004 and the election was scheduled to be held on 13 th October 2004.
It is pointed out that the Second Respondent was also contesting the
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said election and therefore, the Petitioner Authority was under an
impression that the proceedings before the Second Respondent have
been terminated. The challenge to the impugned order is on various
grounds including the ground of breach of the principles of natural
justice.
5. A reply dated 10th December 2014 has been filed by the
Fifth Respondent. In the reply, it was contended that when the Second
Respondent heard the Fifth Respondent, a representative of the
Petitioner was present. It is urged that the Petitioner was permitted to
file a reply and after taking into consideration the reply and the
rejoinder of the Fifth Respondent, the impugned order has been validly
passed. There is a reply filed by Shri Kamalakar Y. Vanjare, Desk
Officer, Revenue and Forests Department, Mantralaya, Mumbai, which
is affirmed on 26th September 2005. It was contended that the Apex
Court has deprecated the practice of one Government Authority
approaching the High Court against another Authority. There is an
affidavit-in-rejoinder filed by Shri Vishwas Jaywantrao Bohsale, the
Chief Executive Officer of the Petitioner Authority. There is a sur-
rejoinder filed by the Petitioner on 17 th October 2005. There is another
affidavit filed by the Fifth Respondent on 15 th June 2015. It is
contended in the said affidavit that the Pimpri Chinchwad Municipal
Corporation has provided all civil amenities to the said land. It is
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contended that as the Pimpri Chinchwad Municipal Corporation has
carried out necessary work by providing civil amenities such as road,
sewerage lines, electricity lines etc., the present Petition filed by the
Petitioner should not be entertained.
6. Civil Application No.1611 of 2015 and Civil Application
No.2397 of 2015 have been filed by the Intervenors who are claiming
right,title and interest in respect of the said lands. Apart from these
two Civil Applications, there is another Civil Application No.2550 of
2014 filed by an Intervenor.
FACTUAL MATRIX- Writ Petition No.9528 of 2004
7. Writ Petition No.9528 of 2004 has been preferred by the
same Petitioner challenging another order passed by the same Hon'ble
Minister who is also the Second Respondent in the said Petition. The
said order was also passed on 21 st September 2004 in relation to the
lands bearing Survey No.18/1, 18/2, 18/11, 18/12, 18/13, 19/1 and
19/2 at Village Rahatani, Taluka Haveli, District- Pune (for short"the
said land"). The facts of this Petition are otherwise identical to the
facts of Writ Petition No.9525 of 2004. Even the impugned orders are
more or less identical.
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SUBMISSIONS OF THE PARTIES
8. The learned counsel appearing for the Petitioner urged that
the Second Respondent has held that it was necessary for the Petitioner
to prove the dire and desperate need for the acquisition of the said
lands subject matter of these Petitions. He urged that for acquiring a
land for the public purpose under the Land Acquisition Act, it is not
necessary to establish dire or desperate need. He urged that this is the
only ground on which the Second Respondent has purported to exercise
the powers under Sub-Section (1) of Section 48 of the Land Acquisition
Act. He urged that no opportunity of personal hearing was granted to
the Petitioner and even on this ground, the impugned order is illegal.
He pointed out that the written argument filed by the Petitioner has not
been correctly read by the Second Respondent. He pointed out that a
copy of the rejoinder filed by the Fifth Respondent which is considered
in the impugned order was never served to the Petitioner.
9. The learned senior counsel representing the Fifth
Respondent who is claiming to be the the owner of the said lands urged
that while dealing with the Application under Sub-Section (1) of
Section 48 of the Land Acquisition Act, the State Government or the
Commissioner, as the case may be, exercise administrative function.
Hence, the Second Respondent was under no obligation to record
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reasons for deleting the said lands from the acquisition. Moreover, he
submitted that in both the impugned orders,the Second Respondent has
assigned cogent reasons. He pointed out that it was contended before
the Second Respondent by the Petitioner that the said acquired lands
will be used for allotment of plots under the 12.5% scheme to the
project affected persons. He pointed out that out of the total area of
1586 Hectares received by the Petitioner by way of compulsory
acquisition, an area of only 397 Hectares could be used by the
Petitioner and therefore, a large area was already available with the
Petitioner for the implementation of the 12.5% scheme He urged that
on the basis of this finding of fact, the impugned orders have been
passed. He urged that Writ Court cannot go into the issue of adequacy
of reasons. He urged that the impugned orders show that the
contentions of the parties have been considered in depth. He submitted
that in any event, as the possession of the said lands is not taken over
till 31st December 2014, in view of the provisions of Sub-Section (2) of
Section 24 of the Right to Fair Compensation and Transparency in Land
Acquisition, Rehabilitation and Resettlement Act, 2013 ( for short "the
said Act of 2013"), the acquisition proceedings subject matter of these
two Petitions have lapsed. He would, therefore, urged that even if the
Petitioner succeeds in the Petitions, in any case, the acquisition
proceedings under the Land Acquisition Act stand lapsed.
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10. The Intervenors have supported the Fifth Respondent. The
learned AGP supported the impugned orders.
CONSIDERATION OF SUBMISSIONS
11. We have given careful consideration to the submissions.
Section 48 of the Land Acquisition Act as applicable to the State of
Maharashtra reads thus:
"48.
ig Completion of acquisition not compulsory, but
compensation to be awarded when not
completed.-- (1) Except in the case provided
for in Section 36, the Government or the
Commissioner shall be at liberty to withdraw
from the acquisition of any land of which
possession has not been taken.
(2) Whenever the Government or the
Commissioner withdraws from any such
acquisition, the Collector shall determine the
amount of compensation due for the damage
suffered by the owner in consequence of the
notice or of any proceedings thereunder, and
shall pay such amount to the person interested,
together with all costs reasonably incurred by
him in the prosecution of the proceedings
under this Act relating to the said land.
(3) The provisions of Part III of this Act shall apply,
so far as may be, to the determination of the
compensation payable under this Section."
12. In the present case, the Second Respondent has purported
to exercise the powers under Sub-Section (1) of Section 48 of the Land
Acquisition Act while passing the impugned orders.
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13. We have perused the impugned orders which are more or
less identical. Paragraph 2 of the said orders contains the facts.
Paragraphs 3 to 8 record the contentions raised by the Fifth Respondent
in the Application. Paragraph 9 records that on 16 th September 2004,
the Petitioner filed written statement/written argument. It also records
that a rejoinder dated 20th September 2005 was filed by the Fifth
Respondent. Paragraph 10 refers to the written submissions of the
Petitioner. Paragraph 11 refers to the contents of the rejoinder of the
Fifth Respondent. Five issues were framed by the Second Respondent
in paragraph 12. English translation of the said five issues reads thus:-
"1. Whether the Applicant can file an application for
deleting the lands from acquisition as per
provisions sec. 48(1) of Land Acquisition Act
1894?
2. Whether actual possession of the suit land is
given to the Authority as per sec 16 of the Act?
3. Whether Government has power to pass an order
u/sec 48(1) of the said Act for deleting the
lands?
4. Whether the lands in question are necessary to
the Authority for the public purpose?
5. Whether it will be proper to release for said
lands from the acquisition under the provisions
of sec 48(1) of the 1894 Act after considering
the application submitted by the Applicants."
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14. Thus, the real issue is the Issue No.4. We have carefully
perused the findings of the Second Respondent on the Issue No.4. The
findings on Issue No.4 are in Paragraphs 16 and 17. Paragraphs 16 and
17 reproduce the submissions of the learned counsel appearing for the
Fifth Respondent. It refers to the judgment of this Court in Writ Petition
No.1116 of 1994. Paragraph 17 refers to the contentions raised by the
learned Advocate of the Petitioner. The only finding recorded is in the
last two sub paragraphs of Paragraph 17. The English translation of the
said sub paragraphs reads thus:
"It is submitted by the Authority that the lands in
question are necessary for allotting to the agriculturist
under 12.5% return scheme. This reason given by the
Authority is false and only by way of after thought.
Such a statement made at this stage is prima facie
misguiding and only for supporting the action of taking
possession the lands which were not taken in
possession for last 17 years; even though the
Government has applied the scheme, the mentioned
scheme for the Pimpri Chinchwad new town
development area in the year 1993. So also out the
1586 H. land taken in possession by the Authority 25%
i.e. (397 H.) land is till today available with the
Authority and same can be used for 12.50 % return.
From all above discussion it is clear that the Authority
has failed to prove that the land in question is
desperately required for public purpose Authority
could not submit a concrete proof of the need."
(emphasis added)
15. It must be noted here that the purpose of acquisition as
notified under Sub-Section (1) of Section 4 of the Land Acquisition Act
is not for allotment of the said lands under the 12.5% scheme. The
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purpose of acquisition as stated in the notification under under Sub-
Section (1) of Section 4 of the Land Acquisition Act is "for the planned
development and utilisation of the said lands in the Pimpri Chinchwad
Township area for industrial, commercial and Residential use." Thus,
the Second Respondent has not even adverted to the public purpose for
which the said lands were acquired. We have perused the reply filed by
the Petitioner to the Application under Sub-Section (1) of Section 48 of
the Land Acquisition Act filed by the Fifth Respondent. It is pointed out
in the reply that out of the acquired lands totally admeasuring 1839.25
Hectares, an area of 1586.75 Hectares has been already placed in
possession of the Petitioner and the work of development of 75% of the
said lands is already completed. It is stated in the reply that as the said
lands (subject matter of these Petitions) were not placed in possession
of the Petitioner, the work of development could not be undertaken. It is
contended that the Petitioner badly needs the said lands. Thereafter, it
is contended that the said lands can be used for allotment of plots
under the 12.5% scheme to the persons whose lands have been
acquired for the purpose of the Petitioner. It is contended that if the
acquisition is cancelled, no lands will remain available to the Petitioner
for the development and also for the allotment under the 12.50%
scheme. It is contended that the object of the acquisition of the lands
for the purpose of the Petitioner Authority has been established. It is
contended that the Petitioner requires the said lands for the public
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purpose of residential use. It is contended that the estimated
compensation of the lands has been long back deposited by the
Petitioner.
16. From the findings recorded by the Second Respondent in
Paragraph 17 which were quoted above, it appears that the Second
Respondent was of the view that the lands should be released from the
acquisition as the Petitioner has not established the desperate need or
necessity of the said lands for the public purpose.
17. After the publication of the Notification under Sub-Section
(1) of Section 4 of the Land Acquisition Act, a declaration under Section
6 of the Land Acquisition Act has been made long back in the year
1973. It is not the case of any party that before a declaration under
Section 6 of the Land Acquisition Act was made, an inquiry under
Section 5A of the Land Acquisition Act was not made. It will be
necessary to consider Sub-Section (3) of Section 6 of the Land
Acquisition Act which reads thus:-
"6(3) The said declaration shall be conclusive that the
land is needed for a public purpose or for a Company,
as the case may be; and, after making such
declaration, the appropriate Government may acquire
the land in manner hereinafter appearing."
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18. Thus, the declaration made in these cases under Section 6
of the Land Acquisition Act is the conclusive evidence of the fact that
the said lands were needed for the public purpose. We have perused
the definition of the public purpose under Clause (f) of Section 3 of the
Land Acquisition Act. The definition of public purpose is not exhaustive.
On the conjoint reading of the said definition along with Sections 4 and
6 of the Land Acquisition Act, it appears that for establishing the
existence of a public purpose, it is not necessary to establish dire or
desperate need/necessity. The Second Respondent was completely
under a misconception that the dire or desperate need is an essential
ingredient of the public purpose under the Land Acquisition Act.
Moreover, in view of Sub-Section (3) of Section 6 of the Land
Acquisition Act, a declaration already made under Section 6 of the Land
Acquisition Act in relation to the said lands was a conclusive evidence of
the fact that the said lands were needed for the public purpose. The
declaration under Section 6 of the Land Acquisition Act has attained
finality. While exercising the power under Sub-Section (1) of Section
48, the declaration under Section 6 of the Land Acquisition Act by the
State Government binds the State. In view of Sub-Section (3) of Section
6, while exercising the power Sub-Section (1) of Section 48, the State
Government cannot go into the issue whether public purpose was in
existence on the day on which the declaration was issued under
Section 6. However, the State Government can examine in a given case
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whether with the passage of time, the public purpose continues to exist.
It is not the finding recorded that due to the events which have
happened after the declaration under Section 6 of the Land Acquisition
Act was made, the public purpose has ceased to exist.
19. As regards the implementation of 12.5% Scheme, the
Second Respondent has observed that out of an area of 1586 Hectares
which was placed in possession of the Petitioner, an area of 397
Hectares which is equivalent to 25% of the total land in possession of
the Petitioner was available. This finding was recorded on the basis of
the stand taken by the Petitioner. It is, therefore, necessary to consider
the specific stand taken by the Petitioner on this aspect in the reply/
written statement filed by it before the Second Respondent. In
Paragraph 6, it is stated that the awards under Section 11 of the Land
Acquisition Act were made in respect of the area 1839.25 Hectares out
of which an area of 1586.75 Hectares has been placed in possession of
the Petitioner. It is further stated that the work of development of 75%
of the lands placed in possession of the Petitioner has been completed.
It is not at all the case of the Petitioner that either the remaining area of
25% is not required by the Petitioner or that no development is to be
carried out on the said remaining area. The contention raised in the
reply is that 75% of the area of the acquired lands placed in possession
of the Petitioner has been already developed. The conclusion drawn by
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the Second Respondent that 25% of the lands is available for making an
allotment under the 12.5% scheme has no foundation at all. The stand
in the reply is that the said lands are needed both for the public purpose
for which the same were notified as as well as for making allotments
under 12.50% scheme. It is contended that if the acquisition is
cancelled, no lands will remain available to the Petitioner for the
development and also for making the allotments under the 12.50%
scheme. It is not the stand taken that the said land are not needed for
the purpose for which the same were acquired. Thus, the Second
Respondent has proceeded on an erroneous assumption that the
Petitioner needs the said lands only for making allotments under
12.50% scheme. Moreover, the Second Respondent has completely
ignored that as per the 12.50% scheme, developed plots are to be
allotted to the project affected persons.
20. In fact, the entire approach of the Second Respondent is
completely erroneous as he has completely misunderstood the concept
of public purpose. He was of the view that dire or desperate necessity
is an essential ingredient of the public purpose within the meaning of
the Land Acquisition Act. As held earlier, the said approach is
completely erroneous.
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21. The Apex Court has repeatedly held that the principles of
natural justice are applicable to an application under Sub-Section (1) of
Section 48 of the Land Acquisition Act. While dealing with the exercise
of the said power, the Apex Court in the case of State Govt. Houseless
Harijan Employees' Assn. v. State of Karnataka 1 in paragraph 33
and 34 held thus:
"33. The Section does not in terms exclude the
principles of natural justice. However, the Section
has been construed to exclude the owner's right to
be heard before the acquisition is withdrawn. This
is because the owner's grievances are redressable
under Section 48(2). No irreparable prejudice is
caused to the owner of the land and, if at all the
owner has suffered any damage in consequence of
the acquisition proceedings or incurred costs in
relation thereto, he will be paid compensation
thereof under Section 48(2) of the Act.
(See Amarnath Ashram Trust Society v.Governor of
U.P. [(1998) 1 SCC 591] SCC at p. 596;
also Special Land Acquisition Officer v.Godrej &
Boyce [(1988) 1 SCC 50 : (1988) 1 SCR 590] .)
But as far as the beneficiary of the acquisition
is concerned there is no similar statutory
provision. In contrast with the owner's position
the beneficiary of the acquisition may by
withdrawal from the acquisition suffer
substantial loss without redress particularly
when it may have deposited compensation
money towards the cost of the acquisition and
the steps for acquisition under the Act have
substantially been proceeded with. An
opportunity of being heard may allow the
beneficiary not only to counter the basis for
withdrawal, but also, if the circumstances
permitted, to cure any defect or shortcoming
and fill any lacuna. No reason has been put
1 (2001) 1 SCC 610
ash 19 wp-9525n9528.04
forward by the respondents to exclude the
application of the principle of natural justice to
Section 48(1) of the Act.
34. The decision in Larsen & Toubro [(1998) 4 SCC
387] which relied upon an earlier decision
in Amarnath Ashram Trust Society v. Governor of
U.P. [(1998) 1 SCC 591] to hold that a beneficiary
has a right to be heard before a notification under
Section 48(1) is issued, does not appear to be
limited to acquisition for companies under Part VII
of the Act as is contended by the respondents
although the acquisition in that case had been
made for a company for the purpose of setting up
a housing colony. Both cases have also drawn a
igdistinction between the rights of an owner and
the beneficiary of the acquisition to object to
withdrawal from the acquisition for the reasons
noted earlier."
(emphasis added)
22. The Apex Court in the case of Mutha Associates v. State
of Maharashtra2 reiterated the same view. In the case of Rajesh
Kumar v. CIT3, the Apex Court dealt with the requirement of recording
reasons while passing administrative orders. In paragraph 20 to 23, the
Apex Court held thus:
"20. Principles of natural justice are based on two
basic pillars:
(i) Nobody shall be condemned unheard
(audi alteram partem).
(ii) Nobody shall be judge of his own cause
(nemo debet esse judex in propria sua
causa).
2 (2013) 14 SCC 304
3 (2007) 2 SCC 181
ash 20 wp-9525n9528.04
21. Duty to assign reasons is, however, a judge-made
law. There is dispute as to whether it comprises
of a third pillar of natural justice. (See S.N.
Mukherjee v. Union of India [(1990) 4 SCC 594 :
1990 SCC (Cri) 669 : 1991 SCC (L&S) 242 :
(1991) 16 ATC 445] and Reliance Industries
Ltd. Designated Authority [(2006) 10 SCC 368 :
2006 AIR SCW 4911] .)
22. However, the other view is that the question as to
whether reasons are required to be assigned is a
matter of legislative policy which should be left
to the decision of Parliament. InRaipur
Development Authority v. Chokhamal Contractors
[(1989)2 SCC 721] a Constitution Bench opined:
(SCC pp. 751-52, para 35)
"35. It is no doubt true that in the decisions
pertaining to administrative law, this Court in
some cases has observed that the giving of
reasons in an administrative decision is a rule of
natural justice by an extension of the prevailing
rule. It would be in the interest of the world of
commerce that the said rule is confined to the
area of administrative law. We do appreciate the
contention, urged on behalf of the parties who
contend that it should be made obligatory on the
part of the arbitrator to give reasons for the
award, that there is no justification to leave the
small area covered by the law of arbitration out
of the general rule that the decision of every
judicial and quasi-judicial body should be
supported by reasons. But at the same time it has
to be borne in mind that what applies generally
to settlement of disputes by authorities governed
by public law need not be extended to all cases
arising under private law such as those arising
under the law of arbitration which is intended for
settlement of private disputes. As stated
elsewhere in the course of this judgment if the
parties to the dispute feel that reasons should be
given by the arbitrators for the awards it is within
their power to insist upon such reasons being
given at the time when they enter into arbitration
agreement or sign the deed of submission. It is
ash 21 wp-9525n9528.04
significant that although nearly a decade ago the
Indian Law Commission submitted its report on
the law of arbitration specifically mentioning
therein that there was no necessity to amend the
law of arbitration requiring the arbitrators to give
reasons, Parliament has not chosen to take any
step in the direction of the amendment of the law
of arbitration. Even after the passing of the
English Arbitration Act, 1979 unless a court
requires the arbitrator to give reasons for the
award [vide Sub-Sections (5) and (6) of Section
1 of the English Arbitration Act, 1979], an award
is not liable to be set aside merely on the ground
that no reasons have been given in support of it."
23. We, however, need not dilate on the said question
being not very necessary for the purpose of this
case. But it is beyond any cavil that ordinarily
unless excluded by operation of a statute, the
superior courts while exercising power of judicial
review shall proceed on the basis that assignment
of reasons is imperative in character. When an
authority, be it administrative or quasi-judicial
adjudicates on a dispute and if its order is
appealable or subject to judicial review, it
would be necessary to spell out the reasons
therefor. While applying the principles of
natural justice, however, the court must also
bear in mind the theory of useless formality
and the prejudice doctrine."
(emphasis added)
The Apex Court has repeatedly held that the order of
releasing a land from acquisition by exercise of power under Sub-
Section (1) of Section 48 is open to judicial review. In the case of
Amarnath Ashram Trust Society v. Governor of U.P. 4, the Apex Court
held thus:
4 (1998) 1 SCC 591
ash 22 wp-9525n9528.04
"10. However, it is not necessary to go into this
larger question whether in such a case the State
Government can withdraw from acquisition without
the consent of the company as the justification given
by the Government is otherwise not sustainable. As
stated earlier the reason given by the Government for
withdrawing from the acquisition is that as no part of
the cost of acquisition was to be borne by the
Government the acquisition could not have been
sustained as for a public purpose. We have already
pointed out that in this case the acquisition was not
for a public purpose but it was an acquisition for a
company under Chapter VII of the Act. In respect of an
acquisition for a company under Chapter VII of the Act
law does not require that the State should also bear
some cost of acquisition to make it an acquisition for
public use. Thus the decision of the Government to
withdraw from acquisition was based upon a
misconception of the correct legal position. Such a
decision has to be regarded as arbitrary and not
bona fide. Particularly in a case where as a result
of a decision taken by the Government the other
party is likely to be prejudicially affected, the
Government has to exercise its power bona fide
and not arbitrarily. Even though Section 48 of the
Act confers upon the State wide discretion it does
not permit it to act in an arbitrary manner. Though
the State cannot be compelled to acquire land
compulsorily for a company its decision to
withdraw from acquisition can be challenged on
the ground that power has been exercised mala
fide or in an arbitrary manner. Therefore, we
cannot accept the submission of the learned
counsel for the State that the discretion of the
State Government in this behalf is absolute and not
justiciable at all."
(emphasis added)
23. Hence, while deciding an application under Sub-Section
(1) of Section 48 of the said Act, the State Government is under an
obligation to record reasons as the said order can be always subjected
ash 23 wp-9525n9528.04
to a challenge on the grounds of misconception of law, arbitrariness,
mala fides. etc. Moreover, before the exercise of the said power, it is
necessary to give an opportunity of being heard to the person who will
be the beneficiaries of the acquisition.
24. We have already held that the impugned orders are based on
the legal misconception and are also based on incorrect reading of the
written submissions/reply of the Petitioner. Therefore, as the impugned
orders are arbitrary, the same deserve to be set aside. Moreover, the
averment in paragraph 8 of the Petition that a copy of the rejoinder of
the Fifth Respondent was not served to the Petitioner is not disputed in
the affidavits on record. In the impugned order, the rejoinder has been
considered. This amounts to breach of the principles of natural justice.
25. As far as the applicability of Sub-Section (2) of Section 24
of the said Act of 2013 is concerned, the Fifth Respondent has filed a
separate Writ Petition which is pending in this Court and, therefore, in
these Petitions filed by the Petitioner, it will not be necessary to consider
the effect of Sub-Section (2) of Section 24 of the said Act of 2013.
26. Though we are setting side the impugned orders, the same
will not preclude the Fifth Respondent from making a fresh Application
under Sub-Section (1) of Section 48 of the Land Acquisition Act
ash 24 wp-9525n9528.04
provided any other ground is available for the exercise of the said
power. The issue of the locus of the said Respondent for filing such
application is kept open.
27. Therefore, the Petitions must succeed and we pass the
following order:
ORDER :
(a)
ig The impugned orders dated 21 st September 2004
(Exhibit-E to both the Petitions) are hereby quashed
and set aside and the Applications made by the Fifth
Respondent on which the impugned orders were
passed stand rejected;
(b) This order will not preclude the Fifth Respondent
from filing fresh Applications under Sub-Section (1)
of Section 48 of the Land Acquisition Act, 1894
provided any other ground is available for the
exercise of the said power. The issue of the locus of
the said Respondent for filing such application is
kept open ;
ash 25 wp-9525n9528.04
(c) The issue of applicability of Sub-Section (2) of
Section 24 of the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation
and Resettlement Act, 2013 to the acquisition of the
lands subject matter of these Petitions is kept open;
(d) The Rule is partly made absolute on above terms;
(e)
ig Civil Application Nos.1611 of 2015, 2397 of 2015
and 2550 of 2014 do not survive and the same are
disposed of. However, no adjudication has been
made on the rights claimed by the Applicants.
( V.L. ACHLIYA, J ) ( A.S. OKA, J )
