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TaxTMI 
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2014 (5) TMI 1143
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.... 1976 (hereinafter referred to as the 'Act 1976') would be operative for the land other than the land covered by Section 20(2) of the Act 1976, though upheld the validity of Section 40(3)(jj) of the Act 1976. Civil Appeal Nos.1545-50 of 2001 have been preferred by the State of Gujarat against the same judgment raising the grievance to the same extent. Civil Appeal Nos.1551-56 of 2001 have been filed by the Ahmedabad Urban Development Authority (hereinafter referred to as `AUDA') against the same judgment passed in same cases alongwith Special Civil Application Nos.4859, 5934, 7476 of 1998 and 4271 of 2000. Civil Appeal No. 1864 of 2014 has been filed against the impugned judgment and order dated 9.10.2009 passed by the High Court of Gujarat at Ahmedabad in Special Civil Application No.10912 of 2009, wherein the matter stood disposed of in terms of the subject matter in appeals referred to above. In Transferred Case (C) Nos.12-13 of 2010, Writ Petition Nos.2879 and 2880 of 2009 had been filed by the tenure holders/petitioners before the High Court of Gujarat and as the same factual and legal issues are involved therein, the petitions stood transferred to this court. 2. As simil....
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....a scheme, is not an adequate compensation. Further, it was not justified under the town planning scheme or the urban development to permit acquisition of certain percentage of properties of citizens for its disposal in the hands of public authorities for the purpose of raising its fund, even to be used for further development. Under the Act 1976, Section 40(3)(j) as it originally stood, provided for reserving only 10 per cent in the town planning scheme for providing housing accommodation to the members of the weaker sections. Therefore, the amendment by which the said area has been increased from 10% to 15% is not only unwarranted but also illegal. 3. Facts and circumstances giving rise to these matters are as under: A. In 1963, Ahmedabad Municipal Corporation (hereinafter referred to as the 'AMC') prepared and submitted a development plan under the Bombay Town Planning Act, 1964 (hereinafter referred to as "Bombay Act") whereby the lands of the respondents known as the 'green belt' were kept for open space and recreation. On 21.8.1965, the State Government sanctioned the development plan which came into force on 1.10.1965. B. AMC prepared its revised development plan and pub....
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....of the land to the extent of 50% without paying any compensation amounts to expropriation and in all circumstances percentage fixed by the statutory provisions is excessive. 6. On the contrary, learned counsel appearing for the state and statutory authorities have submitted that the judgments impugned have made the scheme unworkable as one tenure holder may get all infrastructure facilities while the adjacent neighbour may not get any facility at all. The area which can be taken away by the authority for sale to the extent of 15% relates to the total area covered by the scheme and not from each and every plot. 7. In order to properly understand the dispute herein, reference has to be made to various provisions of the Act 1976. The Preamble of the Act 1976 indicates that the purpose of the legislation is to consolidate and amend the law relating to the making and execution of development plans and town planning schemes in the State of Gujarat. Section 12 of the Act 1976 provides for proposals and reservations to be made in the development plan for the approval of the State Government. 8. Clause (x) of Section 2 of the Act 1976 defines "development plan" while clause (xxvi) thereo....
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....l be deemed to have lapsed". Section 40(3) (j) & (jj)(a) of the Act reads as under: "(j) the reservation of land to the extent of ten percent; or such percentage as near thereto as possible of the total area covered under the scheme for the purpose of providing housing accommodation to the members of socially and economically backward classes of people. (jj) (a) the allotment of land from the total area covered under the scheme, to the extent of: (i) Fifteen percent for roads; (ii) Five percent for parks, playgrounds, garden and open space (iii) Five percent for social infrastructure such as schools, dispensary, fire brigade, public utility place as earmarked in the Draft Town Planning Scheme. (iv) Fifteen percent for sale by appropriate Authority for residential, commercial or industrial use depending upon the nature of development. Provided that the percentage of the allotment of land specified in paragraphs (i) to (iii) may be altered depending upon the nature of development and for the reasons to be recorded in writing; (b) the proceeds from the Sale of land referred to in para (iv) of sub-clause (a) shall be used for the purpose of providing infrastructural fa....
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....for contribution towards costs of scheme. Section 82 of the Act 1976 reads as under: Compensation in respect of property or right injuriously affected by scheme. The owner of any property or right which is injuriously affected by the making of a town planning scheme shall, if he makes a claim before the Town Planning Officer within the prescribed time, be entitled to be compensated in respect thereof by the appropriate authority or by any person benefited or partly by the appropriate authority and partly by such person as the Town Planning Officer may in each case determine: Provided that the value of such property or rights shall be deemed to be its market value at the date of the declaration of intention to make a scheme or the date of the notification issued by the State Government under sub-section (1) of section 43 without reference to improvements contemplated in the scheme, as the case may be. Section 84 thereof deals with the cases in which amount payable to owners exceeds amount due from him. As per the provisions of Section 84, if the owner of an original plot is not provided with a plot in the preliminary scheme or if the contribution to be levied from him under ....
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....d amount of the increment under Section 78 (iv) Amount of incremental contribution under Section 79 (v) The compensation under Section 82 (vi) Net amount of contribution (vii) Net amount payable to you" 12. The aforesaid provisions read conjointly gives a clear picture that the scheme is just like the consolidation proceedings as the land, belonging to various persons, covered by the scheme first be put into a pool and then the land be allocated for different purposes and, in such a way, after having all deductions for the purpose of either by way of acquisition of land under the Land Acquisition Act 1894 (hereinafter referred to as `Act 1894') or the land taken under the provisions of Section 40(3)(jj)(a) of the Act 1976, the loss and profit of individual tenure holder is to be calculated. After assessing the market value on the date of declaration of the intention to frame a scheme and the value of the property after making all these deductions, adjustments, improvements etc. and, therefore, if a person has suffered any loss, his loss is to be made good from the funds of the scheme and if a person has gained an amount equivalent to net gain, is to be recovered from him. ....
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....nded by the respondents. The current provision now only specifies specific percentage of the land to be set aside for the specified purpose which was already provided for in the Act 1976 and there is no further reservation that is provided. II) Entry 18 of List II of the Constitution provides for legislative competence with respect to land i.e. rights in or over the land including land improvement. Entry 20 of Concurrent List of the Constitution deals with economic and social planning. Therefore, the State Legislature was well within its competence to specify the percentage of areas to be demarcated/used for the specified purpose. Further, a mere increase of percentage of land to be demarcated for a specific purpose can in no way said to be an excessive legislation. Section 91 of the Act 1976 provides for establishment of funds for utilization by the appropriate authority in order to meet expenditures for the development of land, administration of the Act and such other purpose as the State Government may direct. With the increase in cost of construction, the requisite funds for development would naturally increase and therefore, there does not seem to be any impediment in prescr....
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.... v. State of Rajasthan & Ors., AIR 2002 SC 1533, this Court held: "There must be proper pleadings and averments in the substantive petition before the question of denial of equal protection of infringement of fundamental right can be decided. There is always a presumption in favour of the constitutionality of enactment and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles. The presumption of constitutionality stems from the wide power of classification which the legislature must, of necessity possess in making laws operating differently as regards different groups of persons in order to give effect to policies. It must be presumed that the legislature understands and correctly appreciates the need of its own people, that its laws are directed to problems made manifest by experience." 18. In Prakash Amichand Shah v. State of Gujarat & Ors., AIR 1986 SC 468, this Court relied upon the judgment of this Court in Zandu Pharmaceutical Works Ltd. v. G.J. Desai, Civil Appeal No. 1034 of 1967 decided on August 28, 1969 dealing with the very provisions of the Act, wherein this Court had observed : "When the Town Plan....
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....f reconstituted plots to persons from whom original plots are taken, it is difficult to apply the provisions of the Land Acquisition Act, 1894. The provisions of Section 32 and the other financial provisions of the Act provide for the determination of the cost of the scheme, the development charges to be levied and contribution to be made by the local authority etc. It is only after all that exercise is done the money will be paid to or demanded from the owners of the original plots depending on the circumstances governing each case. If in the above context the Act has made special provisions under Sections 67 to 71 of the Act for determining compensation payable to the owners of original plots who do not get the reconstituted plots it cannot be said that there has been any violation of Article 14 of the Constitution. It is seen that even there the market value of the land taken is not lost sight of. The effect of the provisions in Sections 67 to 71 of the Act has been explained by this Court in Maneklal Chhotalal v. M.G. Makwana, AIR 1967 SC 1373, and in State of Gujarat v. Shantilal Mangaldas, AIR 1969 SC 634. Thus it is seen that all the arguments based on Article 14 and Artic....
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.... held: "37. The words "so far as may be" indicate the intention of the Legislature to the effect that by providing revision of final development plan from time to time and at least once in ten years, only the procedure or preparation thereof as provided therein, is required to be followed. Such procedural requirements must be followed so far as it is reasonably possible. Section 21 of the Act, in our opinion, does not and cannot mean that the substantial right conferred upon the owner of the land or the person interested therein shall be taken away. It is not and cannot be the intention of the Legislature that which is given by one hand should be taken away by the other. 38. Section 21 does not envisage that despite the fact that in terms of sub-section (2) of S. 20, the designation of land shall lapse, the same, only because a draft revised plan is made, would automatically give rise to revival thereof. Section 20 does not manifest a legislative intent to curtail or take away the right acquired by a land owner under S. 22 of getting the land defreezed. In the event the submission of the learned Solicitor General is accepted the same would completely render the provisions of S.....
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....h Section 81 of the Act 1976. By re-constitution of the plots, if anybody suffers injury, the statutory provisions provide for compensation under Section 67(b) read with Section 80 of the Act 1976. By this re-constitution and readjustment of plots, there is no vesting of land in the local authority and therefore, the Act provides for payment of non-monetary compensation and such a mode has been approved by the Constitution Bench of this Court in Shantilal Mangaldas (supra), wherein this Court has held that when the scheme comes into force all rights in the original plots are extinguished, and simultaneously therewith ownership springs in the re-constituted plots. It does not predicate ownership of the plots in the local authority, and no process - actual or notional - of transfer is contemplated in that appropriation. Under clause (a) of Section 53, vesting of land in local authority takes place only on commencement of scheme into force. The concept that lands vest in a local authority when the intention to make a scheme is notified, is against the plain intendment of the Act. Even steps taken by the State do not involve application of the doctrine of eminent domain. 24. In Manekl....
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.... no fundamental right to hold property. But the right to compensation on compulsory acquisition is still available under the second proviso to Article 31A subject to the limitation as specified therein. However, we need not elaborate the same as the said averment is not argued before us. 28. Article 300-A of the Constitution though creates a human right being a constitutional provision, but is not a fundamental right. Article 300-A provides that no person can be deprived of his property except by authority of law. The Town Planning Act is definitely an authority of law by which a person is deprived of his property if we assume that the town planning scheme deprives a person of his property, though it is not so in view of the judgments of this Court in Shantilal Mangaldas (supra) and Prakash Amichand Shah (supra). 29. So far as the question that upon lapsing of designation under the development plan under Section 20 there cannot be any reservation/designation under a town planning scheme for the same land, is to be understood reading the provisions of the Act 1976 cogently. The development plan is prepared under Chapter II and town planning scheme is made under Chapter V. Therefor....
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....heme and not in respect of every plot of land. In order to generate financial resources for the development of infrastructure, the saleable plot for residential, commercial and industrial use are allotted by the appropriate authority. Similarly, while re-constituting the plots, final plot is offered to the original owner for its beneficial use. 31. The High Court has committed an error interpreting the provisions under challenge as it failed to appreciate that the provisions of the Town Planning Scheme in Chapter-V, no where indicate that the lands under Section 20 cannot be subject matter of the Town Planning Scheme. The interpretation given by the High Court tantamounts to rewriting the provisions of the Act 1976 as the High Court has held that the land under Section 20 cannot be the subject of Section 40(3)(jj). Section 40(3)(jj)(a) only illustrates and provides the guidance to the authority. 32. So far as the observation made by this Court in Bhavnagar University (supra) is concerned, the court held that the land which has been de-reserved under Section 20 cannot be subject matter of revised development plan under Section 20(1). However, the issue involved in that case was in....
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....is Court examined the scheme under the Act 1954 which was applicable earlier to the State of Gujarat wherein with respect of the land situated therein, the Borough Municipality of Ahmedabad declared its intention of making a town planning scheme vide resolution dated 18.4.1927 under the Bombay Town Planning Act, 1915, wherein the High Court of Gujarat had allowed the writ petition filed by the tenure-holders. This Court reversed the said judgment observing as under: "22. The following principles emerge from an analysis of Clauses (2) and (2A): compulsory acquisition or requisition may be made for a public purpose alone, and must be made by authority of law. Law which deprives a person of property but does not transfer ownership of the property or right to possession of the property to the State or a corporation owned or controlled by the State is not a law for compulsory acquisition or requisition. The law, under the authority of which property is compulsorily acquired or requisitioned, must either fix the amount of compensation or specify the principles on which, and the manner in which, the compensation is to be determined and given. If these conditions are fulfilled the validi....
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.... date of extinction of interest of the owner, but on the footing of the value prevailing at the date of the declaration of the intention to make a scheme, is not a provision for payment of compensation............... ...............The method of determining compensation in respect of lands which are subject to the townplanning schemes is prescribed in the Town Planning Act. There is no option under that Act to acquire the land either under the Land Acquisition Act or under the Town Planning Act. Once the draft town-planning scheme is sanctioned, the land becomes subject to the provisions of the Town Planning Act, and the final town-planning scheme being sanctioned, by statutory operation the title of the various owners is readjusted and the lands needed for a public purpose vest in the local authority. Land required for any of the purposes of a townplanning scheme cannot be acquired otherwise than under the Act, for it is settled rule of interpretation of statutes that when power is given under a statute to do a certain thing in a certain way the thing must be done in that way or not at all.................." (Emphasis added) 35. Thus, we do not find any force in the submissions....
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....gh Court to that extent is not sustainable in the eyes of law. 40. In the transferred cases, the resolution dated 16.5.2008 providing the extent of taking over the land to 50% has been challenged on the ground that in other similar schemes in Vadodara, the maximum land taken by the State/Authority had been only upto 30%. Therefore, the deduction to the extent of 50% of the total land of a tenure-holder is illegal acquisition or amounts to expropriation and not acquisition. It is further submitted by Shri Huzefa Ahmadi, learned senior counsel appearing for the petitioners in transferred cases that in case of non-agricultural land, the deduction may be upto 20% and for agricultural land it may be upto 30%. Shri Ahmadi has placed a very heavy reliance on a chart filed by him showing that in other similar cases, a very lesser area had been deducted by the State/Authority and in the instant case 15% area had been proposed for sale without drawing the balance sheet. In such a fact-situation, the cases have to be allowed. 41. On the contrary, Shri Preetesh Kapur appearing for the respondents has submitted that it is pre-mature to challenge the resolution dated 16.5.2008 as it is a first....