The Supreme Court on 1st March,2021 comprising of a bench of Justices R.F. Nariman & B.R. Gavai took a very grim view of a West Bengal government body retaining unlawful possession of a property in Kolkata for the last 22 years without "paying a single amount towards compensation" (Punalur Paper Mills Limited v. West Bengal Mineral Development and Trading Corporation).
The SC stated that "A very disturbing feature of these appeals is the fact that WBMDTCL, which is “State” within the meaning of Article 12 of the Constitution of India, has continued in unlawful possession of the Premises since 15.08.1998 without paying a single pice towards compensation till date."
Facts of the case
The property admeasuring 7,500 sq. ft. at kool-aid was requisitioned under the west Bengal Premises Requisition And Control(Temporary Provisions) Acts, 1947 (Act) in August 1973 to the respondents.
In March 1987, Section 10B was inserted in the Act. According to the said provision, any property requisitioned under the act had to be released by the state Government on or before the expiry of a period of 25years from the date of requisition. The said period had expired in August 1998, obligating the State to release the premises.
However, the respondent did not vacate the said premises and it was in unlawful possession of the same occupying it as permanent office accommodation. This was south be done by issuing a notification under section 4 of the Land Acquisition Act, 1894.
The said notification was challenged in Calcutta High Court(HC). The HC ordered the respondents to vacant possession of the premises and to hand over it within three months.
The petition was kept alive to determine compensation;in the meanwhile, the same order was vacated as the state issued another notification concerning the same property, by invoking the urgency provision under Section 17(4).
In 2017, a single-judge of the HC struck down all those notifications and ordered that vacant possession be handed over to the owner in three months.
An appeal was filed before the Division Bench of the HC which directed that the property should be vacated and possession should be handed over to punalur paper Mills within three months.
An appeal was filed before the SC against the aforesaid order of the Division Bench of the High Court.
Contention of the parties
Ms. Liz Mathew, the advocate appearing on behalf of the State of West Bengal, assailed the impugned judgment of the Division Bench by arguing that the order of the Single Judge dated 22.06.2000 had made it clear that the State could take appropriate steps to initiate land acquisition proceedings, which were then done pursuant to such order on 04.08.2000. Taking shelter under this order, she therefore argued that it would not be possible to strike down the notification under section 4 read with section 17 of the Land Acquisition Act, since this was done pursuant to the order dated 22.06.2000. For this purpose, she relied upon the judgments of this Court in State of U.P. v. Keshav Prasad Singh, (1995) 5 SCC 587 and State of A.P. v. Goverdhanlal Pitti, (2003) 4 SCC 739.
Shri Mukul Rohatgi, the advocate appearing on behalf of the Appellant, stoutly refuted these arguments and relied upon certain judgments of this Court which covered the issue in the Appellant’s favour. In any case, he also argued that given the conduct of the parties in not vacating the Premises by 15.08.1998 and continuing to be in unauthorised possession till date, as well as not paying a singlepaisa towards compensation, this Court ought not to entertain the State’s appeals under Article 136 of the Constitution of India.
Court's Observation and judgment
The SC held that West Bengal Govt. was on notice from 31 March 1987, when section 10B was inserted in the Act and it further stated that the said premises would have to be vacated on or before August 1998.
The SC held that " The Division Bench held that st best this order could possibly refer to the acquisition proceedings that had already been initiated by the notification of 12.08.1999 under setion 4 of the land acquisition Act. In any case, this order could not and did not wash away the lethargy of the state in initiating acquisition proceedings, which ought tohave been done before the 25-year period elapsed."
Disappointed with the respondents the Apex Court noted that the disturbing feature of the appeals was that a government body that fell within the definition of the state was retaining unlawful possession of a property for the last 22year without paying any money.
The bench appointed former Calcutta HC judge, Justice Sumatra Pal to act as an arbitrator and to decide the amount of compensation that is payable to the appellants by the respondents.
The court further directed in its order that "A written authority to appoint such arbitrator is to be furnished to us immediately, i.e withina week from 23.02.2021. If not so furnished, WBMDTCL will be liable to pay a sum of Rs. 100per Sq. Ft., per month for the entire period of illegal occupation of the premises within four months from the date of this judgment. "
The SC asked the respondent to hand over the possession of the premises to the appellant with four months.
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