1967 (9) TMI 145 - SC - Indian Laws

Supreme Court declares Section 8(3)(b) unconstitutional, emphasizes fundamental rights protection

Union of India Versus Kamlabhai Harjiwandas Parekh and others

The Supreme Court held that Section 8(3)(b) of the Requisitioning and Acquisition of Immovable Property Act, 1952, was unconstitutional as it failed to ... - Issues Involved:1. Constitutionality of Section 8(3)(b) of the Requisitioning and Acquisition of Immovable Property Act, 1952.2. Delay in filing the petition under Article 226 of the Constitution.Issue-Wise Detailed Analysis:1. Constitutionality of Section 8(3)(b) of the Requisitioning and Acquisition of Immovable Property Act, 1952:The Supreme Court examined the constitutionality of Section 8(3)(b) of the Requisitioning and Acquisition of Immovable Property Act, 1952, which stipulates that compensation for acquired property should be the lesser of either the price the requisitioned property would have fetched in the open market if sold on the date of acquisition or twice the price it would have fetched if sold on the date of requisition.The Court referred to the preamble and various sections of the Act, noting that the Act was designed to provide for the requisitioning and acquisition of immovable property for the Union. The Court emphasized that the Act must be analyzed in the context of the Constitution as it stood before the Fourth Amendment Act of 1955.Several precedents were cited, including:- The State of West Bengal v. Mrs. Bela Banerjee and others ([1954] S.C.R. 558): The Court held that compensation under Article 31(2) must be a 'just equivalent' of the property acquired and that fixing an anterior date for valuation without reference to the acquisition date was arbitrary.- State of Madras v. D. Namasivaya Mudaliar ([1964] 6 S.C.R. 936): The Court ruled that fixing compensation based on an outdated market value was arbitrary and inconsistent with Article 31(2) as it stood before the Fourth Amendment.- P. Vajravelu Mudaliar v. Special Deputy Collector ([1965] 1 S.C.R. 614): Reaffirmed that compensation must be a 'just equivalent' of the property.The Court concluded that Section 8(3)(b) was arbitrary as it mandated compensation based on the lesser of two valuations, one of which (twice the price on the date of requisition) had no rational basis. This method did not provide a just equivalent of the property at the time of acquisition, thus violating Article 31(2). The Court stated, 'Clause (b) of sub-s. (3) of s. 8 leaves the arbitrator no choice of assessing the value in terms of cl. (a) even if he was of opinion that the mode fixed thereunder afforded a just equivalent of the property to its owner.'2. Delay in Filing the Petition under Article 226 of the Constitution:The Union of India argued that the petition should be dismissed due to the delay in its filing. The High Court had rejected this argument, noting that while the original acquisition occurred on April 4, 1953, the arbitrator was appointed on June 21, 1961, and the petitioner approached the Court on September 18, 1962.The Supreme Court upheld the High Court's decision, stating that in cases of fundamental rights infringement, mere delay does not affect the maintainability of the petition. The Court emphasized, 'In appeal, we do not feel disposed to take a different view. If the High Court had any discretion in the matter-and it is not suggested that it had not-the exercise of such discretion ought not to be over-ruled by us unless we are satisfied that the High Court had 'acted on some wrong principle or committed some error of law or failed to consider matters which demand consideration.''Conclusion:The Supreme Court dismissed the appeal, affirming the High Court's judgment that Section 8(3)(b) of the Requisitioning and Acquisition of Immovable Property Act, 1952, was ultra vires Article 31(2) of the Constitution. The Court also upheld the High Court's decision to condone the delay in filing the petition, emphasizing the importance of addressing fundamental rights violations. The appeal was dismissed with costs.