M/s. Delhi Airtech Services Pvt. Ltd. & ANR. Vs. State of U.P. & ANR.
J U D G M E N T
Swatanter Kumar, J.
1. I had the advantage of reading the well-written judgment of my learned brother, A.K. Ganguly, J. Regretfully but respectfully, I am unable to persuade myself to concur with the findings recorded and the exposition of law expressed by my learned brother. In order to discernly state the reasons for my expressing a contrary view and dismissing the appeals of the appellants on merits, it has become necessary for me to state the facts as well as the law in some detail.
It has been necessitated for the reason that complete facts, as they appear from the record and the facts which were brought to the notice of the Court during the course of hearing by the respondents, supported by the official records, duly maintained by them in normal course of their business, have not, in their entirety, and correctly been noticed in the judgment. I am also of the considered view that, in fact, the questions framed (particularly question `D') in the judgment by my learned brother neither so comprehensively arise in the facts and circumstances of the present case nor were argued in that manner and to that extent before the Court.
Be that as it may, I consider it necessary to restate the facts, deal with different legal aspects of the case and then record the conclusions which would even provide answers to the questions framed by my learned brother at the very beginning of his judgment. Before I proceed to do so, let me briefly but, inter alia, state the reasons for my taking a view contrary to the one recorded in the judgment of my learned brother:I. I have already stated that complete and correct facts, in their entirety, as they emerge from the records produced before the Court (including the trial court record) as well as the documents referred to during the course of arguments by the respondents have not been correctly noticed.
The records referred to have been maintained by the authorities in the normal course of their business and their authenticity can hardly be questioned. These documents have been executed inter se various institutions/departments, including the Collector's office, who discharges quasi- judicial functions under the Act. II. The judgment of this court in the case of Satendra Prasad Jain & Ors. v. State of U.P. & Ors. [AIR 1993 SC 2517 = (1993) 4 SCC 369], in my humble view, cannot be ignored and the principle stated therein cannot be avoided on the ground that the judgment was sub silentio. This I say so, for the reason that it is not a decision in which the point was not raised, argued and perceived by the Court. On the contrary, the issue in relation to the consequences of non-payment flowing from Section 17(3A) of the Land Acquisition Act (for short, the `Act') was specifically noticed by the three-Judge Bench in paragraph 11 of the judgment. It was discussed in some detail and a definite finding was recorded thereby bringing the judgment well within the dimensions of good precedent.
Thus, I, with respect, would prefer to follow the larger Bench judgment rather than ignoring the same for the reasons stated by my learned brother in his judgment do not apply in the facts of the present case.III. The ratio decidendi of the judgment of this Court in the case of Satendra Prasad Jain (supra) is squarely applicable to the present case, on facts and law.IV. It has not been correctly noticed in the judgment that 80 per cent of due compensation, which even the appellants did not dispute during the course of hearing, had not been tendered or paid to the claimants, as contemplated under Section 17(3A) of the Act. From the facts recorded hereinafter, it is clear that within the prescribed period, the payments were deposited with the State office of the Collector/competent authority and it was for the State to distribute the money in accordance with the provisions of the Act.
It is not only the scheme of the Act but also an established practice that the amounts are disbursed by the Collector to the claimants and not directly by the beneficiary, for whose benefit the land had been acquired. The beneficiary had discharged its obligation by depositing, in fact, in excess of 80 per cent of due compensation with the competent authority. De hors the approach that one may adopt in regard to the interpretation of Section 17(3A), on facts the notification is incapable of being invalidated for non-compliance of the said Section.V. The doctrine of strict construction does not per se mandate that its application excludes the simultaneous application of all other principles of interpretation.
It is permissible in law to apply the rule of strict construction while reading the provisions of law contextually or even purposively. The golden rule of interpretation is the rule of plain language, while preferring the interpretation which furthers the cause of the Statute rather than that which defeats the objects or purposes of the Act. VI. Non-providing of consequences under Section 17(3A) of the Act, in contradistinction to Sections 6 and 11 of the same Act, in my considered view is largely the determinative test for proper and judicious interpretation of Section 17(3A).VII.
The judgment by my learned brother does not consider the judgments of the Constitution Bench, the larger Bench and even the equi-Bench, which have to some extent a direct bearing on the matters in issue before us. In this regard, reference can be made to the Constitution Bench judgment of this Court in the case of Offshore Holdings Pvt. Ltd. v. Bangalore Development Authority & Ors. [(2011) 3 SCC 139], the three-Judge Bench judgment in the case of Tika Ram & Ors. v. State of U.P. & Ors., [(2009) 10 SCC 689] and particularly the judgment of another equi-Bench of this Court in the case of Banda Development Authority, Banda v. Moti Lal Agarwal & Ors. [2011 (5) SCALE 173], to which my learned brother (Ganguly, J.) was a member.
The latter case, inter alia, dealt with a question of lapsing of proceedings under Section 11A on the ground that the possession of the property had not been taken as required under that provision. While rejecting such a contention in that case, the Court observed that if the beneficiary of the acquisition is an agency or instrumentality of the State 80 per cent of the total compensation is deposited in terms of Section 17(3A) and substantial portion of the acquired land has been utilized in furtherance of the particular public purpose, it could reasonably be presumed that the possession of the acquired land had been irrevocably taken. The Court then held that relief to the appellants (like the appellants in the present case) of invalidating the acquisition proceedings and restoring the land could not be granted. VIII.
The 44th Constitutional Amendment, on the one hand, omitted Article 19(1)(f) and Article 31 while introducing Articles 31A and 300A to the Constitution of India on the other. Right to property was deleted as a fundamental right in the Constitution. Thus, this right cannot be placed on equi terms, interpretatively or otherwise, to the pre-constitutional amendments. The right to eminent domain would operate on a different sphere, interpretation and effect, pre and post constitutional repealments of these Articles and introduction of Article 300A of the Constitution. Even on this aspect, I respectfully disagree with the conclusions recorded by my learned brother (Ganguly, J.).FACTS:
2. Appellant No.1 is a company duly incorporated under the provisions of the Indian Companies Act, 1956 and is alleged to be the owner of the land sought to be acquired by the respondents. The land of the appellant, admeasuring about 2-06-1/3-0 Bighas situated in Village Haldauni, Tehsil and Pargana Dadri, District Gautam Budh Nagar, which is an abadi land, was sought to be acquired by the appropriate Government under a notification dated 17th April, 2002 issued under Section 4(1) read with Sections 17(1) and 17(4) of the Act. This land was acquired for the planned industrial development in District Gautam Budh Nagar through the New Okhla Industrial Development Authority (NOIDA).
The notification also stated that the provisions of Section 5A of the Act shall not apply. In pursuance to the said notification, a declaration under Section 6 of the Act was published on 22nd August, 2002, declaring the area which was required by the Government. It also stated that after expiry of 15 days from the date of the publication of the notification possession of the acquired land shall be taken under sub-section (1) of Section 9 of the Act.
The appellants have alleged that they did not receive any notice under Section 9(1) of the Act but possession of the land was nevertheless taken on 4th February, 2003. According to the appellants, even after lapse of more than three and a half years after publication of declaration under Section 6 of the Act, the award had not been made and published. The appellants also alleged in the petition that, despite inordinate delay, they were neither paid 80 per cent of the estimated compensation in terms of Section 17(3A) of the Act at the time of taking of possession, nor had the Collector passed an award within two years of making the declaration under Section 17(1), as required by Section 11A of the Act.
It was the case of the appellants in the writ petition that this has the effect of vitiating the entire acquisition proceedings. Non-payment of the compensation and conduct of the Government compelled the petitioners to file a writ petition in the High Court of Allahabad praying for issuance of an order or direction in the nature of certiorari or any other writ, not to create any encumbrance or interest on the land of the petitioners. Further, they prayed that the acquisition proceedings, in so far as they relate to the land of the petitioner, be declared void ab initio and that the respondents be directed to return the land from the possession of the Government to the owners. Lastly, the petitioners prayed that the respondents /Government be directed to pay damages for use and occupation of the land.
To this writ petition, the respondents had filed a counter affidavit in the High Court, denying that the acquired land was in fact a part of the abadi land. The respondent-authority has also stated that 80 per cent compensation in terms of Section 17(3A) of the Act had been deposited with the authorities. The land had been acquired for planned development of NOIDA and was in the physical possession of the said authority. Possession of the land had been taken on 4th February, 2003 and no right had survived in favour of the petitioners as the land vested in the Government.
The High Court, vide its judgment dated 28th August, 2006, dismissed the writ petition. The High Court relied upon 12the judgment of this Court in the case of Satendra Prasad Jain (supra) and dismissed the petition holding that the provisions of Section 11A of the Act are not attracted to proceedings for acquisition taken by the Government under Section 17 of the Act. However, liberty was granted to the petitioners to pray for grant of appropriate compensation in accordance with law before the competent forum. Aggrieved by the said order of the High Court, the appellants have filed the present appeal impugning the judgment dated 28th August, 2006. In the counter affidavit filed by respondent No.2 before this Court, the submissions made before the High Court have been reiterated with an additional fact that the sector in question was designated as industrial area and after the development activity was completed, allotment has been made and possession of these industrial plots has also been handed over to such entrepreneurs/allottees. This land falls under Sector 88 of the NOIDA City.
The rest of the allegations made 13in the writ petition, except the dates in question, have been disputed. It has also been stated at the Bar, on the basis of the record maintained in regular course of its business by the respondent-authority, that 10 per cent of the estimated compensation was deposited by the Authority with the State Government even prior to the date of the notification under Section 4(1) read with Section 17(4) of the Act, issued by the Government, i.e., 17th April, 2002. The remaining 70 per cent of the estimated compensation had allegedly been deposited vide cheque dated 8/14th July, 2002 amounting to approximately `6,66,00,000/-. As such, there is complete compliance with the provisions of Section 17(3A) of the Act by the authority concerned.
The Award was made on 9th June, 2008, which has been accepted by a large number of owners, i.e., 97.6 per cent of all owners. Some of these facts have also been averred in the counter affidavit filed before the High Court. 14 From the above pleadings of the parties, the admitted facts that emerge from the record can be usefully recapitulated. The Governor of the State of Uttar Pradesh on 17th April, 2002, issued a notification under Section 4(1) of the Act, expressing the intention of the Government to acquire the land stated in the said Notification for a public purpose, namely, for the planned industrial development in District Gautam Budha Nagar through NOIDA. Vide the same notification the emergent provisions contained in Section 17 of the Act, specifically Section 17(4), were also invoked, intimating the public at large that the provisions of Section 5A of the Act shall not be applicable.
After issuance of the declaration under Section 6 of the Act, admittedly the possession of the land in question was taken on 4th February, 2003. However, it remains a matter of some dispute before the Court as to whether 80 per cent compensation, which is deposited by the beneficiary with the State, had actually been received by the land owners/claimants, if so, to what extent and by how many. 15 The Collector had not made or published the award even at the time of pronouncement of the judgment of the High Court, in Writ Petition No. 22251 of 2006, on 28th August, 2006.
The High Court, in the impugned judgment, has directed the respondent No.1 to ensure that the Award is made as early as possible, preferably within a period of three months from the date of production of the certified copy of that order. In the counter affidavit filed before this Court, it has been stated by the State of Uttar Pradesh that the Award was finally made and published on 9th June, 2008. According to the appellant, given the fact that the declaration under Section 6 of the Act was dated 22nd August, 2002, then in terms of Section 11A of the Act, the acquisition proceedings had lapsed as the award ought to have been pronounced on or before 21st August, 2004.
Discussion on objects and reasons of the Act With the enormous expansion of the State's role in promoting public welfare and economic development since independence, the acquisition of land for public purposes, like industrialization, building of institutions, etc., has become far more numerous than ever before. This not only led to an increase in exercise of executive powers, but also to various legislative amendments to the Act. The 1870 Act abolished the system of uncontrolled direction by arbitrators and in lieu thereof, required the Collector, when unable to come to terms with the persons interested in the land which it desired to acquire, to refer these differences to the Civil Courts.
It was also felt necessary by the framers, to restructure the legislative framework for acquisition of land so that it is more adequately informed by this objective of servicing the interests of the community in harmony with the rights of the individual. Various amendments were made and certain new provisions added to the Act by Amendment Act, 68 of 1984, which took effect from 24th September, 1984. Amongst others, Sections 11A and 17(3A) of the Act were new provisions added by this enactment. The objects and reasons for amending the Act were to bring a greater degree of harmony between the interests of the owners of the land, on the one hand, and the acquiring authority on the other.
In its recommendations, the 17Law Commission also expressed a view that individuals and institutions, who are unavoidably deprived of their property rights, need to be adequately compensated for their loss keeping in view the sacrifice they have had to make in the larger interests of the community. The pendency of acquisition proceedings for long periods causes hardship to the affected parties; so steps were required to be taken to truncate the procedural aspect of acquisition proceedings on the one hand, and to pay adequate compensation to the owners of the land on the other. By introducing the provisions of Section 11A of the Act to the normal course of acquisition proceedings, greater responsibility was intended to be fastened upon the concerned authorities, whereby they were obliged to make an award within two years of the declaration made under Section 6 of the Act.
The other obvious purpose of the amendment was that before emergency provisions are invoked by the State and possession is taken in terms of Section 17(1) of the Act, as opposed to the normal procedure of acquisition of land where possession is taken after the making of an award, it was to be obligatory upon the authorities concerned to pay 80 per cent 18of the estimated compensation to the land owners, prior to taking possession of the land in terms of Section 17(3A) of the Act. Despite the fact that Right to Property in terms of Article 19(1)(f) of the Constitution stood deleted from Chapter III of the Constitution, vide 44th Constitutional Amendment, 1978, Article 300A of the Constitution was added by the same Constitutional Amendment, mandating that `no person shall be deprived of his property save by authority of law'.
This indicates that the Constitution still mandates two aspects in relation to acquisition of land by the exercise of power of eminent domain vested in the State. Firstly, such acquisition has to be by the authority of law; in other words, it has to be in accordance with the law enacted by the competent legislature and not by mere executive action. Secondly, there has to be a public purpose for acquisition of land and the person interested in such land would be entitled to compensation.
The objects and reasons for introducing the Bill leading to the Amendment Act 68 of 1984, have explained the 19amendments made to the Act. It is not necessary for us to dwell upon all the amendments carried out in the Act. Suffice it to refer to the amendment made in the definition of `public purpose' under Section 3(f) of the Act and to the provisions of Sections 11A and 17(3A), with which this Court is primarily concerned in the present case. If I may put it in rather simple language, the object of the legislation was to create greater balance between the exercise of power of eminent domain by the State and the owner's deprivation of his property by way of compulsory acquisition and the greater acceptability of acquisition proceedings amongst land owners.
This balance is sought to be created by introducing higher responsibility and statutory obligations upon the acquiring authority. Expeditious and proper payment of fair market value for the acquired land to the claimants is required in the light of sacrifice made by them in the larger public interest. In the case of Devinder Singh & Others v. State of Punjab and Others [(2008)1 SCC 728], a Bench of this Court took the view that the provisions of the Act should be strictly 20construed. Referring to the provisions of the Act, it spelt out the ingredients of valid acquisition to be, (a) the existence of a public purpose; and (b) the payment of requisite compensation. In cases of acquisition of land for a private company, the existence of a public purpose is not necessary but all other statutory requirements were held to remain imperative in character, requiring strict compliance.
Whether the provisions of Sections 17(3A) and 11A of the Act are mandatory or directory and to what effect? Let us first examine the general principles that could help the Court in determining whether a particular provision of a statute is mandatory or directory. In `Principles of Statutory Interpretation', 12th Edition, 2010, Justice G.P. Singh, at page 389 states as follows: "As approved by the Supreme Court: "The question as to whether a statute is mandatory of directory depends upon the intent of the Legislature and not upon the language in which the intent is clothed. The meaning and intention of the legislation must govern, and these are to be ascertained not only from the phraseology of the provision, but also by considering its nature, its design and the consequences which would follow from construing it the one way or the other"
"For ascertaining the real intention of the Legislature", points out Subbarao, J, "the court may consider inter alia, the nature and design of the statute, and the consequences which would follow from construing it the one way or the other; the impact of the other provisions whereby the necessity of complying with the provisions in question is avoided; the circumstances, namely, that the statute provides for a contingency of the non-compliance with the provisions; the fact that the non-compliance with the provisions is or is not visited by some penalty; the serious or the trivial consequences, that flow therefrom; and above all, whether the object of the legislation will be defeated or furthered".
If object of the enactment will be defeated by holding the same directory, it will be construed as mandatory, whereas if by holding it mandatory, serious general inconvenience will be created to innocent persons without very much furthering the object of enactment, the same will be construed as directory. But all this does not mean that the language used is to be ignored, but only that the prima facie inference of the intention of the Legislature arising from the words used may be displaced by considering the nature of the enactment, its design and the consequences flowing from alternative construction. Thus, the use of the words `as nearly as may be' in contrast to the words `at least' will prima facie indicate a 22 directory requirement, negative words a mandatory requirement `may' a directory requirement and `shall' a mandatory requirement." Maxwell, in Chapter 13 of his 12th Edition of
`The Interpretation of Statutes', used the word `imperative' as synonymous with `mandatory' and drew a distinction between imperative and directory enactments, at pages 314-315, as follows: "Passing from the interpretation of the language of statutes, it remains to consider what intentions are to be attributed to the legislature on questions necessarily arising out of its enactments and on which it has remained silent." The first such question is: when a statute requires that something shall be done, or done in a particular manner or form, without expressly declaring what shall be the consequence of non-compliance, is the requirement to be regarded as imperative (or mandatory) or forms prescribed by the statute have been regarded as essential to the act or thing regulated by it, and their omission has been held fatal to its validity.
In others, such prescriptions have been considered as merely directory, the neglect of them involving nothing more than liability to a penalty, if any were imposed, for breach 23 of the enactment. "An absolute enactment must be obeyed or fulfilled exactly, but it is sufficient if a directory enactment be obeyed or fulfilled substantially". It is impossible to lay down any general rule for determining whether a provision is imperative or directory. "No universal rule," said Lord Campbell L.C., "can be laid down for the construction of statutes, as to whether mandatory enactments shall be considered directory only or obligatory with an implied nullification for disobedience.
It is the duty of Courts of Justice to try to get at the real intention of the Legislature by carefully attending to the whole scope of the statute to be construed." And Lord Penzance said: "I believe, as far as any rule is concerned, you cannot safely go further than that in each case you must look to the subject matter; consider the importance of the provision that has been disregarded, and the relation of that provision to the general object intended to be secured by the Act; and upon a review of the case in that aspect decide whether the matter is what is called imperative or only directory."
In a recent judgment of this Court, May George v. Special Tehsildar and Ors. [(2010) 13 SCC 98], the Court stated the precepts, which can be summed up and usefully applied by this Court, as follows:
(a) While determining whether a provision is mandatory or directory, somewhat on similar lines as afore-noticed, the Court has to examine the context in which the provision is used and the purpose it seeks to achieve;
(b) To find out the intent of the legislature, it may also be necessary to examine serious general inconveniences or injustices which may be caused to persons affected by the application of such provision;
(c) Whether the provisions are enabling the State to do some things and/or whether they prescribe the methodology or formalities for doing certain things;
(d) As a factor to determine legislative intent, the court may also consider, inter alia, the nature and design of the statute and the consequences which would flow from construing it, one way or the other;
(e) It is also permissible to examine the impact of other provisions in the same statute and the consequences of non-compliance of such provisions;
(f) Physiology of the provisions is not by itself a determinative factor. The use of the words `shall' or `may', respectively would ordinarily indicate imperative or directory character, but not always.
(g) The test to be applied is whether non-compliance with the provision would render the entire proceedings invalid or not.
(h) The Court has to give due weightage to whether the interpretation intended to be given by the Court would further the purpose of law or if this purpose could be defeated by terming it mandatory or otherwise. Reference can be made to the following paragraphs of May George (supra) : "
In Dattatraya Moreshwar v. The State of Bombay and Ors. [AIR 1952 SC 181], this Court observed that law which creates public duties is directory but if it confers private rights it is mandatory. Relevant passage from this judgment is quoted below: `7........It is well settled that generally speaking the provisions of 26 the statute creating public duties are directory and those conferring private rights are imperative. When the provisions of a statute relate to the performance of a public duty and the case is such that to hold null and void acts done in neglect of this duty would work serious general inconvenience or injustice to persons who have no control over those entrusted with the duty and at the same time would not promote the main object of legislature, it has been the practice of the Courts to hold such provisions to be directory only, the neglect of them not affecting the validity of the acts done.'
A Constitution Bench of this Court in State of U.P. and Ors. v. Babu Ram Upadhya [AIR 1961 SC 751] decided the issue observing: `29.....For ascertaining the real intention of the Legislature, the Court may consider, inter alia, the nature and the design of the statute, and the consequences which would follow from construing it the one way or the other, the impact of other provisions whereby the necessity of complying with the provisions in question is avoided, the circumstance, namely, that the statute provides for a contingency of the non-compliance with the provisions, the fact that the non- compliance with the provisions is or 27 is not visited by some penalty, the serious or trivial consequences that flow therefrom, and, above all, whether the object of the legislation will be defeated or furthered.'22.
In B.S. Khurana and Ors. v. Municipal Corporation of Delhi and Ors. [(2000) 7 SCC 679], this Court considered the provisions of the Delhi Municipal Corporation Act, 1957, particularly those dealing with transfer of immovable property owned by the Municipal Corporation. After considering the scheme of the Act for the purpose of transferring the property belonging to the Corporation, the Court held that the Commissioner could alienate the property only on obtaining the prior sanction of the Corporation and this condition was held to be mandatory for the reason that the effect of non-observance of the statutory prescription would vitiate the transfer though no specific power had been conferred upon the Corporation to transfer the property.
23. In State of Haryana and Anr. v. Raghubir Dayal [(1995) 1 SCC 133], this Court has observed as under: `5. The use of the word `shall' is ordinarily mandatory but it is sometimes not so interpreted if the scope of the enactment, or consequences to flow from such construction would not so demand. Normally, the word `shall' prima facie ought to be considered 28 mandatory but it is the function of the Court to ascertain the real intention of the legislature by a careful examination of the whole scope of the statute, the purpose it seeks to serve and the consequences that would flow from the construction to be placed thereon. The word `shall', therefore, ought to be construed not according to the language with which it is clothed but in the context in which it is used and the purpose it seeks to serve.
The meaning has to be described to the word `shall; as mandatory or as directory accordingly. Equally, it is settled law that when a statute is passed for the purpose of enabling the doing of something and prescribes the formalities which are to be attended for the purpose, those prescribed formalities which are essential to the validity of such thing, would be mandatory. However, if by holding them to be mandatory, serious general inconvenience is caused to innocent persons or general public, without very much furthering the object of the Act, the same would be construed as directory.'
" The Legislature in Sections 11A and 17(3A) of the Act has used the word `shall' in contradistinction to the word `may' used in some other provisions of the Act. This also is a 29relevant consideration to bear in mind while interpreting a provision. The distinction between mandatory and directory provisions is a well accepted norm of interpretation. The general rule of interpretation would require the word to be given its own meaning and the word `shall' would be read as `must' unless it was essential to read it as `may' to achieve the ends of legislative intent and understand the language of the provisions.
It is difficult to lay down any universal rule, but wherever the word `shall' is used in a substantive statute, it normally would indicate mandatory intent of the legislature. Crawford on `Statutory Construction' has specifically stated that language of the provision is not the sole criteria; but the Courts should consider its nature, design and the consequences which could flow from construing it one way or the other. Thus, the word `shall' would normally be mandatory while the word `may' would be directory. Consequences of non-compliance would also be a relevant consideration.
The word 30`shall' raises a presumption that the particular provision is imperative but this prima facie inference may be rebutted by other considerations such as object and scope of the enactment and the consequences flowing from such construction. Where a statute imposes a public duty and proceeds to lay down the manner and timeframe within which the duty shall be performed, the injustice or inconvenience resulting from a rigid adherence to the statutory prescriptions may not be a relevant factor in holding such prescription to be only directory. For example, when dealing with the provisions relating to criminal law, legislative purpose is to be borne in mind for its proper interpretation. It is said that the purpose of criminal law is to permit everyone to go about their daily lives without fear of harm to person or property and it is in the interests of everyone that serious crime be effectively investigated and prosecuted.
There must be fairness to all sides. (Attorney General's Reference (No. 3 of 1999) (2001) 1 All ER 577 Reference : Justice G.P. Singh on `Principles of Statutory Interpretation', 11th Edition 2008). In a criminal case, the court is required to consider the triangulation of 31interests taking into consideration the position of the accused, the victim and his or her family and the public. The basic purpose of interpretation of statutes is further to aid in determining either the general object of the legislation or the meaning of the language in any particular provision. It is obvious that the intention which appears to be most in accordance with convenience, reason, justice and legal principles should, in all cases of doubtful interpretation, be presumed to be the true one.
The intention to produce an unreasonable result is not to be imputed to a statute. On the other hand, it is not impermissible, but rather is acceptable, to adopt a more reasonable construction and avoid anomalous or unreasonable construction. A sense of the possible injustice of an interpretation ought not to induce Judges to do violence to the well settled rules of construction, but it may properly lead to the selection of one, rather than the other, of the two reasonable interpretations. In earlier times, statutes imposing criminal or other penalties were required to be construed narrowly in favour of the person proceeded against and were 32more rigorously applied.
The Courts were to see whether there appeared any reasonable doubt or ambiguity in construing the relevant provisions. Right from the case of R. v. Jones, ex p. Daunton [1963(1) WLR 270], the basic principles state that even statutes dealing with jurisdiction and procedural law are, if they relate to infliction of penalties, to be strictly construed; compliance with the procedures will be stringently exacted from those proceedings against the person liable to be penalized and if there is any ambiguity or doubt, it will be resolved in favour of the accused/such person. These principles have been applied with approval by different courts even in India. Enactments relating to procedure in courts are usually construed as imperative. A kind of duty is imposed on court or a public officer when no general inconvenience or injustice is caused from different construction.
A provision of a statute may impose an absolute or qualified duty upon a public officer which itself may be a relevant consideration while understanding the provision itself. (See `Maxwell on The Interpretation of Statutes', 12th Edition by P. St. J. Langan and R. v. Bullock, [(1964)1 QB 481]) 33 One school of thought has accepted that the word `shall' raises a presumption that the particular provision is imperative, while the other school of thought believes that such presumption is merely prima facie, subject to rebuttal by the other considerations mentioned above. For example, in M/s. Sainik Motors, Jodhpur & Others v. The State of Rajasthan [AIR 1961 SC 1480], the word `shall' has been held to be merely directory. G.P. Singh in the same edition of the above-mentioned book, at page 409, stated that the use of the word `shall' with respect to one matter and use of word `may' with respect to another matter in the same section of a statute will normally lead to the conclusion that the word `shall' imposes an obligation, whereas the word `may' confers a discretionary power.
But that by itself is not decisive and the Court may, having regard to the context and consequences, come to the conclusion that the part of the statute using `shall' is also directory. It is primarily the context in which the words are 34used which will be of significance and relevance for deciding this issue. Statutes which encroach upon rights, whether as regards person or property, are subject to strict construction in the same way as penal Acts. It is a recognized rule that they should be interpreted, if possible, so as to respect such rights and if there is any ambiguity, the construction which is in favour of the freedom of the individual should be adopted. (See `Maxwell on The Interpretation of Statutes', 12th Edition by P. St. J. Langan) This Court in the case of Devinder Singh (supra) held that the Land Acquisition Act is an expropriatory legislation and followed the case of Hindustan Petroleum Corporation v. Darius Shapur Chennai and Ors. [(2005) 7 SCC 627].
Therefore, it should be construed strictly. The Court has also taken the view that even in cases of directory requirements, substantial compliance with such provision would be necessary. 35 If I analyze the above principles and the various judgments of this Court, it is clear that it may not be possible to lay down any straitjacket formula, which could unanimously be applied to all cases, irrespective of considering the facts, legislation in question, object of such legislation, intendment of the legislature and substance of the enactment. In my view, it will always depend upon all these factors as stated by me above. Still, these precepts are not exhaustive and are merely negative.
There could be cases where the word `shall' has been used to indicate the legislative intent that the provisions should be mandatory, but when examined in light of the scheme of the Act, language of the provisions, legislative intendment and the objects sought to be achieved, such an interpretation may defeat the very purpose of the Act and, thus, such interpretation may not be acceptable in law and in public interest. Keeping in mind the language of the provision, the Court has to examine whether the provision is intended to regulate certain procedure or whether it vests private individuals with certain rights and levies a corresponding duty on the officers concerned.
The Court will still have to examine another aspect, even after holding that a particular provision is mandatory or directory, as the case may be, i.e., whether the effect or impact of such non-compliance would invalidate or render the proceedings void ab initio or it would result in imposition of smaller penalties or in issuance of directions to further protect and safeguard the interests of the individual against the power of the State. The language of the statute, intention of the legislature and other factors stated above decide the results and impacts of non-compliance in the facts and circumstances of a given case, before the Court can declare a provision capable of such strict construction, to term it as absolutely mandatory or directory. Having analysed the principles of statutory interpretation,
I will now refer to the provisions of Section 17(3A) of the Act. Section 17 of the Act vests the appropriate Government with special powers to be exercised in cases of urgency. This provision falls within Part II of the Act. Part II of the Act deals with the entire scheme of acquisition of land 37by the State, right from the stage of issuance of a notification under Section 4 of the Act till making of an award taking possession of acquired land and its consequential vesting in the State. However, to some extent, the provisions of Section 17 of the Act are an exception to the provisions under Sections 4 to 16 of the Act.
The distinguishing features of normal acquisition are that after the issuance of notification under Section 4 of the Act, the State must provide an opportunity to the owners of the land to object to the acquisition in terms of Section 5A of the Act, issue a declaration under Section 6 of the Act, issue notice under Section 9 of the Act and determine compensation by making an award under Section 11 of the Act. However, under the scheme of Section 17 of the Act, the Government can take possession of the property on the expiration of 15 days from publication of notice mentioned in Section 9(1) of the Act.
Furthermore, the provisions of Section 5 of the Act, i.e., the right of the owner to file objection can be declared to be inapplicable. Besides these two significant distinctions, another important aspect that the land vests in the Government under Section 16 of the Act only after the 38award is made and possession of the land is taken, while under Section 17(1), at the threshold of the acquisition itself, the land could vest absolutely in the Government free from all encumbrances. The possession of the acquired property has to be taken by the Collector in terms of Sections 17(2) and 17(3) of the Act. Section 17(3A) of the Act, as already noticed, was introduced by the Amendment Act 68 of 1984 for the purposes of safeguarding the interests of the claimants and required the payment of 80 per cent of the estimated compensation before taking possession.
At this stage itself, it will be useful to refer to the relevant provisions of Section 17 of the Act. Section 17 reads as under: "17. Special powers in case of urgency. - (1) In cases of urgency whenever the appropriate Government, so directs, the Collector, though no such award has been made, may, on the expiration of fifteen days from the publication of the notice mentioned in section 9, sub- section (1) take possession of any land needed for a public purpose.
Such land shall thereupon vest absolutely in the Government, free from all encumbrances. (2) xxxxxx(3) xxxxxx(3A) Before taking possession of any land under sub-section (1) or sub-section (2), the Collector shall, without prejudice to the provisions of sub-section (3)(a) tender payment of eighty per centum of the compensation for such land as estimated by him to the person interested entitled thereto, and (b) pay it to them, unless prevented by some one or more of the contingencies mentioned in section 31, sub-section (2),and where the Collector is so prevented, the provisions of section 31, sub-section (2), (except the second proviso thereto), shall apply as they apply to the payment of compensation under that section.(3B)
The amount paid or deposited under section (3A), shall be taken into account for determining the amount of compensation required to be tendered under section 31, and where the amount so paid or deposited exceeds the compensation awarded by the Collector under section 11, the excess may, unless refunded within three months from the date of Collector's award, be recovered as an arrear of land revenue.(4) In the case of any land to which, in the opinion of the appropriate Government, the provisions of sub-section (1) or sub-section (2) are applicable, the appropriate
Government 40 may direct that the provisions of section 5A shall not apply, and, if it does so direct, a declaration may be made under section 6 in respect of the land at any time after the date of the publication of the notification under section 4, sub- section (1)." Section 17(3A) of the Act makes it obligatory on the part of the authority concerned to tender/pay 80 per cent of the compensation for the acquired land, as estimated by the Collector, to the persons interested and entitled thereto; unless prevented by any of the contingencies mentioned under Section 31(2) of the Act. The use of the word `shall' in Section 17(3A) indicates that the enactors of law desired that the above mentioned procedure should be complied with by the authority concerned prior to taking of possession. That is why the legislature has even taken care to make a provision for deposit of due compensation in court in terms of Section 31(2) of the Act, where an authority is prevented from tendering the amount to the claimants for reasons stated in Section 31(1) of the Act. 80 per cent of the estimated compensation is to be deposited in the Court to which 41reference under Section 18 of the Act would lie.
This clearly shows that there is statutory obligation upon the authorities concerned to tender to the interested persons, compensation in accordance with law. Deposit of money, certainly, is the condition precedent to taking of possession as is amply clear from the language `before taking possession of any land'. The amount so deposited or paid in terms of Section 17(3A) of the Act will be taken into account for determining the amount of compensation required to be tendered under Section 31 of the Act and provides for the recovery of amounts if it exceeds the awarded amount. Section 17(3A) unambiguously provides a complete mechanism of taking possession and the requirement of payment of 80 per cent of estimated compensation to the claimants. Now,
I would examine WHAT ARE THE CONSEQUENCES of default in compliance to the provisions of Section 17(3A) of the Act. The said Section is completely silent on such consequences. Where the Legislature has, in specific terms, provided for the extent of payment, mode of payment 42and even the difficulties which are likely to arise, i.e, where a person may not be entitled to receive the compensation or in any other eventuality such as where the compensation cannot be paid for the reasons stated in Section 31(1) of the Act, there the Legislature in its wisdom has provided no contingencies and/or consequences of non-deposit of this money. This is in complete contradistinction to the provisions contained in Sections 6 and 11A of the Act. Section 6 provides that no declaration shall be issued where the period specified in the first proviso to Section 6(1) of the Act has expired.
In other words, it spells out the consequences of failure to do an act within the stipulated period. Similarly, Section 11A of the Act provides that the acquisition proceedings shall lapse where the Collector fails to make an award within a period of two years from the date of publication of declaration under Section 6 of the Act. Thus, the legislative intent is very clear. Keeping the objects and reasons for amendment in mind, the Act strives for a fair balance between the rights of private individuals and 43the power of eminent domain of the State and also attempts to ensure expeditious disbursement of compensation, as determined in accordance with law, to the claimants.
The legislature has provided for every contingency for tendering payment, while remaining silent about consequences flowing from default under some other provisions. Sections 11A and 17(3A) of the Act are clear illustrations of clarity and purpose in legislative intent. When the framers of law have not provided for any penal consequences for default in compliance to Section 17(3A), then it will be uncalled for to provide such consequences by judicial interpretation. While interpreting the provisions for compensation, the Court can provide such interpretation as would help to bridge the gaps left by the Legislature, if any, in implementation of the provisions of the Act. But it will hardly be permissible for the Court to introduce such consequences by way of judicial dicta, like requiring lapse of acquisition proceedings. This is not a matter covered by the principles of judicial interpretation.
It is a well settled canon of statutory interpretation that the courts would neither add nor subtract from the plain language of the statutory provision. In the present case also, there is hardly any justification for the courts to take any contrary view. Once the land has vested in the State and there being no provision for re-vesting the land in the original owners under the provisions of the Act, then it will be in consonance with the scheme of the Act and legislative intent to give an interpretation that would allow provisions of Section 17(1) to operate without undue impediment and keep the vesting of land in the State intact. Otherwise, in some cases the purpose for which such lands were acquired might stand frustrated, while in other cases the purpose of acquisition might have already been achieved and, therefore, divesting State of its title and possession in the acquired land will be incapable of performance.
Under such circumstances, then, to interpret Section 17(3A) of the Act to be so mandatory in its absolute terms that the non-payment of money would result in vitiating or lapsing entire acquisition proceedings, can hardly be justified on the strength of any known principle of 45interpretation of statutes. This question arises more often, as the provisions of Section 17 of the Act are being invoked by the Union of India and State Governments very frequently, so, the consequences of this default, within the framework of law and anything short of invalidation of the acquisition proceedings should be stated by the court with reference to the facts and circumstances of each case.
It is a complete safeguard provided to the land owner inasmuch as the compensation stipulated under Section 17(3A) of the Act should be paid in terms of the provisions of the Act so that the owner is not made to suffer on both counts i.e. he is deprived of his land as well as compensation. It will be unfair for the authorities concerned not to pay the compensation as contemplated under the provisions of the Act. It would be just and fair to read into the provisions of the Section 17(3A) as imposing an obligation on the part of the authorities concerned/the Collector to pay the compensation within the time specified under Section 17(3A). Of course, no specific time, within which the payment has to be made in terms of Section 17(1) has been stated in the provision.
But, it is a settled principle 46of law that wherever specific limitations are not stated, the concept of `reasonable time' would become applicable. So, even if it is argued that there is no specific time contemplated for payment/deposit of 80 per cent of the estimated compensation, even then the claimants would be entitled to receive the amount expeditiously and in any case within very reasonable time. If the authorities are permitted to take possession of the land without payment of the amounts contemplated under Section 17(3A) of the Act, then it would certainly amount to abuse of power of eminent domain within its known legal limitations. The authorities should discern the distinction spelt out under Section 16 of the Act on the one hand and Section 17(1) read with Section 17(3A) of the Act on the other.
Let me examine the judgment of this Court dealing with the provisions of Section 17(3A) of the Act. The judgments of different High Courts have been brought to the notice of this Court, taking divergent views on the question whether the provisions of Section 17(3A) are mandatory or directory. Some 47of these judgments, I would shortly refer to, if necessary.
However, I may notice that none of these judgments have specifically discussed the consequences of non-adherence to the provisions of Section 17(3A) of the Act. A Bench of Delhi High Court in the case of Banwari Lal & Sons Pvt. Ltd. vs. Union of India & Ors., [1991 (1) DRJ (Suppl.) 317 (Delhi Reported Journal)], whilst quashing the notification issued under Section 4 read with Section 17(1) of the Act on the ground of factual lack of urgency for acquisition, held that there was non-compliance to the provisions of Section 17(3A) of the Act. Of course, the High Court took the view that the notification issued under Section 4 read with Section 17(1) of the Act was not maintainable and while quashing the said notification, it also held that there was violation of provisions of Section 5A of the Act and, in fact, no urgency existed.
There was no direct discussion as to whether the provisions of Section 17(3A) of the Act are mandatory or directory. However, this judgment neither provides any reasoning nor actually states the consequences of non-compliance with the provisions of Section 17(3A). For these reasons, this judgment is of no 48help to the parties appearing in the present appeal. Against the judgment of Delhi High Court in Banwari Lal (supra), the Special Leave Petition preferred before this Court was dismissed at the admission stage itself. In the case of Union of India & Ors. v. Krishan Lal Arneja & Ors., [(2004) 8 SCC 453], a part of the acquisition was challenged and writ petitions had been filed for quashing the notification dated 6th March, 1987 issued under Section 4 and Section 17(1) of the Act by Banwari Lal and other owners of the acquired lands.
These writ petitions were allowed by a learned Single Judge of the High Court, appeal against which was dismissed by the Division Bench of the High Court. While considering the appeal against the order of the Division Bench, this Court also dismissed the same. In the appeal, arguments had also been advanced that since the Government before this Court had not made the payment of 80 per cent of estimated compensation in terms of Section 17(3A) of the Act, the acquisition had lapsed. However, in paragraph 36 of that judgment, this Court declined to deal with these contentions as it had dismissed the appeal on other grounds.
The Court incidentally observed that it was not a fair stand to be taken by the State before the Court to argue that it could de-notify the acquired land on the plea that it had failed to comply with the statutory provisions of the Act. In short, the question in controversy in the present case was not actually pronounced upon by the Court in that case.
The question of the provisions of Section 17(3A) of the Act being mandatory or directory again fell for consideration before this Court in the case of Tika Ram & Ors. v. State of U.P. & Ors. [(2009) 10 SCC 689]. In this case, challenge to the constitutional validity of the provisions of Section 17 was also made. The Court, while holding that the said provisions are constitutional, also declared that the provisions of Section 17(3A) were not mandatory and their non-compliance would not vitiate the whole acquisition proceedings. The following paragraphs of the judgment are relevant:
"However, the question is as to what happens when such payment is not made 50and the possession is taken. Can the whole acquisition be set at naught?92. In our opinion, this contention on the part of the appellants is also incorrect. If we find fault with the whole acquisition process on account of the non-payment of 80% of the compensation, then the further question would be as to whether the estimation of 80% of compensation is correct or not.
A further controversy can then be raised by the landlords that what was paid was not 80% and was short of 80% and therefore, the acquisition should be set at naught. Such extreme interpretation cannot be afforded because indeed under Section 17 itself, the basic idea of avoiding the enquiry under Section 5-A is in view of the urgent need on the part of the State Government for the land to be acquired for any eventuality discovered by either sub-section (1) or sub-section (2) of Section 17 of the Act.93.The only question that would remain is that of the estimation of the compensation. In our considered view, even if the compensation is not paid or is short of 80%, the acquisition would not suffer. One could imagine the unreasonableness of the situation. Now suppose, there is state of emergency as contemplated in Section 17(2) of the Act and the compensation is not given, couldthe whole acquisition come to a naught? It would entail serious consequences.
4.This situation was considered, firstly, in Satendra Prasad Jain v. State of U.P. It was held therein that once the possession is taken as a matter of fact, then the owner is divested of the title to the land. The Court held that there was then no question of application of even Section 11-A. Commenting upon Section 11-A, it was held that that the Section could not be so construed as to leave the Government holding title or the land without an obligation to determine the compensation, make an award and pay to the owner the difference between the amount of the award and the amount of the 80% of the estimated compensation. The three-Judge Bench of the Court took the view that even where 80% of the estimated compensation was not paid to the landowners, it did not mean that the possession was taken illegally or that the land did not vest in the Government.
In short, this Court held that the proceedings of acquisition are not affected by the nonpayment of compensation. In that case, the Krishi Utpadan Mandi Samiti, for which the possession was made, sought to escape from the liability to make the payment. That was not allowed. The Court, in para 17, held as under : (Satendra Prasad Jain case, SCC p. 375, para 17) "17. In the insta
