2010 (9) TMI 1251 - SC - Indian Laws

Government exemption notification under Section 178(2) upheld for Mohali township land acquisition with 96% landowner acceptance

Amarjit Singh, Mewa Singh & Ors. Versus State of Punjab &Ors.

The SC upheld the government's exemption notification under Section 178(2) of the Punjab Regional and Town Planning and Development Act, 1995, validating ... Acquisition proceedings - Validity of exemption of the land under acquisition from the provisions of Section 14 and Chapters VIII, X and XII of the Punjab Regional and Town Planning and Development Act, 1995 in terms of notification dated 10th February, 2004 issued under Section 178(2) - rehabilitation of the expropriated land owners - Article 300A of the Constitution - doctrine of eminent domain and guarantees a constitutional right against deprivation of property - Meaning of word 'expedient' - HELD THAT:- The notification in our opinion rightly stated that if immediate steps were not taken to develop the outskirts of the township it would lead to large scale unplanned and haphazard mushrooming of housing colonies and commercial establishments in the area. Delay in the finalization of the outline Master Plan, comprehensive master plan and a town planning scheme thus had the potential of frustrating the very purpose underlying the legislation that is aimed at better planning, regulation, development and use of land in the planning areas. The Government was in that view well within its power to evaluate the options available to it, making a choice and taking appropriate action to prevent any such disorganized and haphazard development. In as much as the Government did so and decided to invoke its powers under Section 178(2) of the Act, it committed no illegality. On the contrary, the Government has by taking timely action prevented a situation where the area around the township of Mohali would have on account of tremendous pressure for conversion of land to non-agricultural use developed into a large slum as is the bane of many other cities in the country where statutory authorities charged with duties of urban development have failed to keep pace with the housing needs of the populace. It is noteworthy that the Government had prevented such haphazard and unplanned development even in sectors 76 to 80 by exempting the land falling in the said sectors from the operation of the provisions of the Punjab Regional and Town Planning and Development Act, 1995. The said exemption was assailed by the land owners but upheld not only by the High Court but even by this Court in appeal. That, the power of exemption could be exercised in situations similar to the one in hand thus stands amply established. Once the existence of circumstances that are relevant to the exercise of the power of exemption are found to exist the formation of the opinion by the Government about the expediency of granting an exemption is a matter on which the Court would be slow to interfere unless the decision is shown to be a colourable exercise or vitiated by any extraneous motive or consideration. Power of exemption reserved in favour of Government under Section 178 of the Town Planning and Development Act, 1995 is also intended to relieve hardship arising from the operation of the Act. It is intended to enable the Government to deal with situations in which circumstances independent of the question of hardship render it expedient to do so by granting exemption. A liberal construction has, therefore, to be placed upon the provisions of Section 178(2) so that exercise of power for good and bona fide reasons is not defeated. We need to remember that nearly 96% of the landowners have already accepted the compensation and either accepted the acquisition proceedings or given up the challenge to the validity thereof. So also the fact that allotments in favour of different institutions have already been made cannot be ignored nor can a prestigious project like the one at hand be scuttled at this stage. It is noteworthy that the notification in question was not assailed before the High Court in the writ petitions filed by the appellants. It is not, therefore, open to the petitioner to argue that the notification suffered from any illegality. No factual foundation having been laid in the writ petition we have no hesitation in rejecting the contention that notification was issued without following the procedure prescribed for the purpose and without considering the objections received from different quarters. That view was affirmed by this Court in appeal and the acquisition for extension of Mohali upheld. Article 300A of the Constitution rests on the doctrine of eminent domain and guarantees a constitutional right against deprivation of property save by authority of law. It mandates that to be valid the deprivation of property must be by authority of law. That such deprivation in the present case is by the authority of law was not disputed, for it is common ground that the property owned by the appellants has been acquired in terms of the provisions of the Land Acquisition Act, 1894 which is a validly enacted piece of legislation. It is also not in dispute that the provisions of Land Acquisition Act invoked by the State for the acquisition under challenge provides for payment of compensation equivalent to the market value of the property as on the date of the preliminary notification apart from other benefits like solatium for the compulsory nature of the acquisition, additional compensation and interest etc. The sum total of all these amounts undoubtedly constitutes a reasonable compensation for the land acquired from the expropriated owners. Neither Article 300A of the Constitution nor the Land Acquisition Act make any measures for rehabilitation of the expropriated owners a condition precedent for compulsory acquisition of land. In the completed acquisitions no provision regarding allocation to be made to the owners has been made. It is also not, in our opinion, feasible at this point of time to super impose the Land Pooling Scheme on the acquisition under challenge and make a provision for allocation to the owners in the sectors that are under development or those that have already been developed. The extent of area available in other sectors for such allotment and allocation is itself a matter regarding which there is no material before us. Conclusion - We upheld the exemption notification, validated the land acquisition process, and rejected the argument for mandatory rehabilitation measures. We direct that if the appellants make applications under Section 18 of the Land Acquisition Act for reference of their claims for higher compensation before the concerned Collector Land Acquisition within a period of six weeks from today the Collector shall make a reference to the competent civil Court for determination of the compensation payable to the appellants. Issues Involved:1. Validity of the exemption of land from certain provisions of the Punjab Regional and Town Planning and Development Act, 1995.2. Impact of the exemption on the legality of the land acquisition process.3. Requirement of rehabilitation measures for expropriated landowners and applicability of the 'Land Pooling Scheme'.Issue-wise Detailed Analysis:1. Validity of the Exemption Notification:The appellants did not challenge the notification dated 10th February 2004 granting exemption in their writ petitions. The High Court noted that without challenging the exemption notification, the appellants could not argue the acquisition violated the 1995 Act. Despite this procedural lapse, the court examined the merits. Section 178(2) of the Punjab Regional and Town Planning and Development Act, 1995 allows the State Government to exempt areas from the Act's provisions if it causes undue hardship or if circumstances render it expedient. The court found that the exemption was justified due to the rapid growth of Mohali and the need for planned development to avoid haphazard construction. The exemption was not just based on the cumbersome process of formulating master plans but on a realistic assessment of urgent needs. The court concluded that the exemption was legally valid, as the government had exercised its power appropriately to prevent unplanned development.2. Impact on Legality of Land Acquisition:Since the exemption was upheld, the question of the acquisition being invalid due to non-compliance with the 1995 Act did not arise. The appellants did not challenge the acquisition process under the Land Acquisition Act itself. The court distinguished the present case from Sanjeet Singh's case, noting that the acquisition was for the expansion of an existing township (Mohali) and not for establishing a new city. The land was already declared a local planning area under Section 56(5) of the 1995 Act. The court rejected the appellants' contention that the notification was issued without following due procedure, as no such challenge was raised in the writ petitions. Thus, the acquisition process was upheld as valid.3. Requirement of Rehabilitation Measures:Article 300A of the Constitution and the Land Acquisition Act do not mandate rehabilitation measures as a precondition for land acquisition. The court noted that while rehabilitation is not a legal requirement, it is a matter of fairness and equity. The appellants argued for the applicability of the Land Pooling Scheme formulated by the State Government in 2008. However, the court found that the scheme was prospective and could not be applied retrospectively to completed acquisitions. The court also noted that applying the scheme retrospectively would create confusion and potential litigation. The court acknowledged the State Government's offer to allow the appellants to seek higher compensation through a reference to the civil court, despite the lapse of the statutory period for such applications. The court directed that if the appellants file applications within six weeks, the Collector should refer the claims to the civil court for determination of compensation.Conclusion:The Supreme Court upheld the exemption notification, validated the land acquisition process, and rejected the argument for mandatory rehabilitation measures. However, it provided relief to the appellants by allowing them to seek higher compensation through the civil court. The appeals were dismissed with no costs.