TaxTMI 
TaxTMI 
2017 (11) TMI 1938
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....r. Sachin Gupta, Ms. Rachana Srivastava, Ms. Monika, Mr. Sukrit R. Kapoor, Ms. Nitya Madhusoodhanan, Mr. Muhammad Khan, Mr. R.V. Prabhat, Mr. Umar Hoda, Mr. Gaurav Goel, Mr. Siddhartha Chowdhury, Mr. Vishaal Maan, Mr. Satyawan Rathee, Mr. Abhishek Gupta, Mr. Keshav Ranjan, Mr. B.V. Balaram Das, ORDER 1. Leave granted. 2. The only issue involved in the present case is whether the provision of Section 24(1)(b) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (hereinafter referred to as 'the Act of 2013') is governed by the proviso to Sub-section (2) of Section 24 of the said Act or it has to be read as part of section 24(2). 3. For the purpose of Delhi Metro Railways, land acquisition was initiated by issuing a Notification on 04.06.2009 under Section 4 read with Section 17(1) and (4) of the Land Acquisition Act, 1894 (hereinafter referred to as 'the Act of 1894'). 4. As per letter dated 16.6.2009, written by the appellant-Delhi Metro Rail Corporation Ltd. ('DMRC', for short) to the Land & Building Department of the Delhi Government, 80% of the land compensation amounting to Rs. 3,28,56,687.49p. (Rupe....
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....as, thus, erred in holding that the compensation is required to be paid under the Act of 2013. 6. On the other hand, learned counsel appearing on behalf of the landowners contended that the proviso to Section 24(2) has to be read as part of Section 24(1)(b) of the Act of 2013, and it cannot be read as part of Sub-Section (2) of Section 24, as legislature have carved out a different independent provision which would be applicable to an Award passed, as contemplated under Section 24(1)(b), and since in the instant case, the amount has not been deposited with respect to the majority of the land holdings in the account of the beneficiaries, the compensation becomes payable to all the beneficiaries under the Act of 2013. Reliance has been placed on the decision of this Court in Delhi Development Authority Vs. Sukhbir Singh & Ors., (2016) 16 SCC 258. 7. Section 24 of the Act of 2013 is extracted hereunder: "24.(1) Notwithstanding anything contained in this Act, in any case of land acquisition proceedings initiated under the Land Acquisition Act, 1894, - (a) Where no award under section 11 of the said Land Acquisition Act has been made, then, all provisions of this....
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....o occur in it, you cannot derive these provisions by implication from a proviso. When one regards the natural history and object of provisos, and the manner in which they find their way into Acts of Parliament, I think your Lordships would be adopting a very dangerous and certainly unusual course if you were to import legislation from a proviso wholesale into the body of the statute, although I perfectly admit that there may be and are many cases in which the terms of an intelligible proviso may throw considerable light on the ambiguous import of the statutory words." And Lord Herschell in the same case said : "I decline to read into any enactment words which are not to be found there and which would alter its operative effect because of provisions to be found in any proviso," though he admitted that a proviso may be a useful guide in the selection of one or other of two possible constructions of words in the enactment or to show the scope of the latter in a doubtful case. In R. v. Dibdin [1910] P.57, 125 Moulton L.J. said: "The fallacy of the proposed method of interpretation is not far to seek. It sins against the fundamental rule of construction that a....
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....not be included in the total income. The proviso also throws light on the construction of the substantive part of clause (i) as the exception can be invoked only upon the application of the income to the said purposes outside the taxable territories. The application of the income in praesenti or in futuro for purposes in or outside the taxable territories, as the case may be, is the necessary condition for invoking either the substantive part of the clause or the proviso thereto." (c) In Kedarnath Jute Manufacturing Co. Ltd. v. The Commercial Tax Officer & Ors., AIR 1966 SC 12, this Court has discussed the purpose of the proviso thus : "8. Section 5(2)(a)(ii) of the Act in effect exempts a specified turnover of a dealer from sales tax. The provision prescribing the exemption shall, therefore, be strictly construed. The substantive clause gives the exemption and the proviso qualifies the substantive clause. In effect, the proviso says that part of the turnover of the selling dealer covered by the terms of sub-cl. (ii) will be exempted provided a declaration in the form prescribed is furnished. To put it in other words, a dealer cannot get the exemption unless he fu....
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....hat it was intended that the enacting part of the section would have included the subject-matter of the proviso. But the question is one of interpretation of the proviso and there is no rule that the proviso must always be restricted to the ambit of the main enactment. Occasionally in a statute, a proviso is unrelated to the subject-matter of the preceding section, of contains matters extraneous to that section, and it may have then to be interpreted as a substantive provision, dealing independently with the matter specified therein, and not as qualifying the main or the preceding section." (e) In Shah Bhojraj Kuverji Oil Mills & Ginning Factory v. Subhash Chandra Yograj Sinha, AIR 1961 SC 1596, this Court has discussed the object of the proviso and how it is to be interpreted thus: "9. The law with regard to provisos is well-settled and well-understood. As a general rule, a proviso is added to an enactment to qualify or create an exception to what is in the enactment, and ordinarily, a proviso is not interpreted as stating a general rule. But, provisos are often added not as exceptions or qualifications to the main enactment but as savings clauses, in which cases....
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....-295 has collected the following principles in regard to a proviso: (a) When one finds a proviso to a sectionthe natural presumption is that, but for the proviso, the enacting part of the section would have included the subjectmatter of the proviso. (b) A proviso must be construed withreference to the preceding parts of the clause to which it is appended. (c) Where the proviso is directlyrepugnant to a section, the proviso shall stand and be held a repeal of the section as the proviso speaks the latter intention of the makers. (d) Where the section is doubtful, aproviso may be used as a guide to its interpretation: but when it is clear, a proviso cannot imply the existence of words of which there is no trace in the section. (e) The proviso is subordinate to the mainsection. (f) A proviso does not enlarge anenactment except for compelling reasons. (g) Sometimes an unnecessary proviso is inserted by way of abundant caution. (h) A construction placed upon a proviso which brings it into general harmony with the terms of section should prevail. (i) When a proviso is repugnant to the enacting part, the provi....
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....e a fresh enactment adding to and not merely excepting something out of or qualifying what goes before. To the same effect is a later decision of the same Court in Jennings v. Kelly 1940 AC 206, where it was observed thus: "We must now come to the proviso, for there is, I think, no doubt that, in the construction of the section, the whole of it must be read, and a consistent meaning, if possible, given to every part of it. The words are:... 'provided that such licence shall be granted only for premises situate in the ward or district electoral division in which such increase in population has taken place...' There seems to be no doubt that the words "such increase in population" refer to the increase of not less than 25 percent of the population mentioned in the opening words of the section." 36. While interpreting a proviso care mustbe taken that it is used to remove special cases from the general enactment and provide for them separately. 37. In short, generally speaking, aproviso is intended to limit the enacted provision so as to except something which would have otherwise been within it or in some measure to modify the enacting clause. Sometimes ....
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.... each other and result in a harmonious construction." 42. In Hiralal Rattanlal v. State of U.P.(1973) 1 SCC 216, this Court made the following observations: [SCC para 22, p. 224: SCC (Tax) p. 315] "Ordinarily a proviso to a section is intended to take out a part of the main section for special treatment. It is not expected to enlarge the scope of the main section. But cases have arisen in which this Court has held that despite the fact that a provision is called proviso, it is really a separate provision and the socalled proviso has substantially altered the main section." 43. We need not multiply authorities afterauthorities on this point because the legal position seems to be clearly and manifestly well established. To sum up, a proviso may serve four different purposes: (1) qualifying or excepting certainprovisions from the main enactment: (2) it may entirely change the veryconcept of the intendment of the enactment by insisting on certain mandatory conditions to be fulfilled in order to make the enactment workable: (3) it may be so embedded in the Actitself as to become an integral part of the enactment and thus acquire the ....
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.... "32. Under Sub-section (1) of Section 21, a landlord can apply for eviction of a tenant on the ground that the building was bona fide required either in its existing form or after demolition and new construction by the landlord for occupation by himself or any member of his family either for residential purposes or for purposes of any profession, trade or calling or on the ground that the building which was in a dilapidated condition was required for purposes of demolition and new construction. The second Proviso to Sub-section (2) however provides that "AN APPLICATION UNDER CLAUSE (a) SHALL NOT BE ENTERTAINED IN THE CASE OF ANY RESIDENTIAL BUILDING FOR OCCUPATION FOR BUSINESS PURPOSES." Thus, if an application is made by the landlord for eviction of the tenant on the ground that the building in occupation of that tenant which was used exclusively for residential purposes was required for business purposes or for any other commercial activity, it would not be a ground within the meaning of Section 21(1) of the new Act for the eviction of the tenant and the application will not be entertained. This we say because the normal function of a PROVISO is to except something out of....
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....isions which are said to occur in it you cannot derive these provisions by implication from a proviso," said Lord Watson in West Derby Union v. Metropolitan Life Assurance Co., 1987 AC 647. Normally, a proviso does not travel beyond the provision to which it is a proviso. It carves out an exception to the main provision to which it has been enacted as a proviso and to no other. [See A.N. Sehgal v. Raje Ram Sheoran, 1992 SUPP 1 SCC 304, Tribhovandas Haribhai Tamboli v. Gujarat Revenue Tribunal (1991) 3 SCC 442 and Kerala State Housing Board v. Ramapriya Hotels (P) Ltd., (1994) 5 SCC 672] "This word (proviso) hath diverse operations. Sometime it worketh a qualification or limitation; sometime a condition; and sometime a covenant." (Coke upon Littleton, 18th Edn., p. 146.) "If in a deed an earlier clause is followed by a later clause which destroys altogether the obligation created by the earlier clause, the later clause is to be rejected as repugnant, and the earlier clause prevails.... But if the later clause does not destroy but only qualifies the earlier, then the two are to be read together and effect is to be given to the intention of the parties as disclosed b....
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....1 SCC 304, Tribhovandas Haribhai Tamboli v. Gujarat Revenue Tribunal (1991) 3 SCC 442 and Kerala State Housing Board v. Ramapriya Hotels (P) Ltd., (1994) 5 SCC 672]. "This word (proviso) hath diverse operations. Sometime it worketh a qualification or limitation; sometime a condition; and sometime a covenant." (Coke upon Littleton, 18th Edn., p. 146.)" "If in a deed an earlier clause is followed by a later clause which destroys altogether the obligation created by the earlier clause, the later clause is to be rejected as repugnant, and the earlier clause prevails.... But if the later clause does not destroy but only qualifies the earlier, then the two are to be read together and effect is to be given to the intention of the parties as disclosed by the deed as a whole." (per Lord Wrenbury in Forbes v. Git, (1922) 1 AC 256). 11. A statutory proviso 'is somethingengrafted on a preceding enactment' (R. v. Taunton St James, (1829) 9 B&C 831 ER p. 311). 'The ordinary and proper function of a proviso coming after a general enactment is to limit that general enactment in certain instances.' (Per Lord Esher in Barker, Re.., (1890) 25 QBD 285). 12.....
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....e main proviso to which it stands as a proviso. This Court held: "13. It is a fundamental rule of construction that a proviso must be considered in relation to the main provision to which it stands as a proviso, particularly, in such penal provisions. Whether there exist any "special and adequate reason" would depend upon a variety of factors and the peculiar facts and circumstances of each case. This Court, in various judgments, has reached the consensus that no hard-and-fast rule can be laid down in that behalf for universal application." 9. What follows from aforesaid enunciation thateffect of a proviso is to except all preceding portion of the enactment. It is only occasionally that proviso is unrelated to subject matter of preceding section, it may have to be interpreted as a substantive provision. Ordinarily, a proviso is not interpreted as stating a general rule. Provisos are often added as saving clauses. A proviso must be construed with reference to the preceding parts of the clause to which it is appended. The proviso is ordinarily subordinate to the main section. A construction placed on proviso which brings general harmony to the terms of the section should ....
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....tion which creates inconsistency or repugnancy has to be avoided and proviso has to be part of Section 24(2) as enacted. As per fundamental rule of its construction, no contrary intention is available in the provisions so as not to read it as part of Section 24(2). As section 24(1)(b) provides, in case award has been passed under Act of 1894, the proceedings shall continue of the said Act as if it has not been replaced whereas Section 24 (2) provides deemed lapse in case award is passed 5 years or more before commencement of Act of 2013 and possession has not been taken or compensation has not been paid and as per the proviso with respect to majority of holding compensation has not been deposited in account of land owners. In case award has been passed few days before commencement of the Act of 2013, then deposit of compensation with respect to majority of holding is bound to take time, that is why legislature has made difference of consequences based upon time gap in passing of award as requisite steps to be taken are bound to consume some time by providing proceedings to continue under the Act of 1894. 12. Section 24(1) begins with non-obstante clause. The Parliament has given....
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.... are not paid. Thus we are of the considered opinion that the proviso to Section 24(2) cannot be lifted and made part of Section 24(1)(b). At the cost of repetition, we observe that reading of Sections 24(1) and 24(2) conjointly & homogenously makes it abundantly clear that they operate in two different fields. Section 24(1)(b) unequivocally indicates that in case the award has been passed under the Act of 1894, all the proceedings shall continue as if the Act of 1894 has not been repealed. Section 24(1)(a) makes the provision of Act of 2013 applicable only in case where the award has not been passed. In other words, it gives a clue that when an award has been passed, obviously further proceedings have to be undertaken under the Act of 1894, to that extent proceedings under the said Act is saved, and the Act of 2013 will not apply. In such cases, there is no necessity of initiation of acquisition proceedings afresh except in cases as provided under Section 24(2). Whereas Section 24(2) would be applicable if the Award under Section 11 of the old Act has been made five years or more prior to commencement of 1894 but physical possession of the land has not been taken or the compens....
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.... of Act of 2013. 14. Reliance has been placed on the decision of this Court in Delhi Development Authority Vs. Sukhbir Singh (supra). The facts of the said case reflect that Notification under Section 4 was issued on 24.10.1961; Award was passed by the Land Acquisition Collector, New Delhi, on 12.12.1997; and possession was taken on 27.1.2000. It was not a case under Section 24(1)(b). It was clearly a case covered by provisions contained in Section 24(2) of the Act of 2013, as Award had been passed 5 years before the commencement of the Act of 2013. In that context, this Court has discussed the matter and observed as follows: "11. Section 24(1) begins with a nonobstante clause and covers situations where either no award has been made under the Land Acquisition Act, in which case the more beneficial provisions of the 2013 Act relating to determination of compensation shall apply, or where an award has been made under Section 11, land acquisition proceedings shall continue under the provisions of the Land Acquisition Act as if the said Act had not been repealed. 12. To Section 24(1)(b) an important exception is carved out by Section 24(2). The necessary ingredien....