Holding

Mere absence of a corrective machinery does not, by itself, render a statutory power unreasonable or unconstitutional; the provision under s.54 of the Bombay Town Planning Act, read with Rule 27, is valid.

Summary

The State of Gujarat issued notices under section 54 of the Bombay Town Planning Act, 1954 and Rule 27 of the Bombay Town Planning Rules, 1955 demanding that lands occupied by Babubhai & Co. be handed over to the Municipal Corporation of Ahmedabad, as the lands had vested in the corporation under section 53(a) for public purposes. The appellants challenged the constitutional validity of the statutory provisions on the grounds that they violated Article 14 by granting unfettered discretion, denied a hearing in breach of natural justice, and lacked any appellate or revisional remedy. The Gujarat High Court upheld the validity of the provisions, holding that the power was quasi‑judicial and required a hearing, and that the provisions were not ultra vires. On appeal, the Supreme Court held that the mere absence of a corrective machinery does not, by itself, render a statutory power unreasonable or unconstitutional; the validity must be assessed by considering the nature of the power, the authority exercising it, and the scheme of the enactment. Since the power under section 54 is exercised by a high‑level local authority in a quasi‑judicial manner and is subject to natural‑justice requirements, the provisions were held valid and the appeals were dismissed.

Issues considered

The absence of an appeal or revision mechanism for orders under s.54/Rule 27 makes the provision unreasonable and violative of Art.14.
Whether s.54 confers absolute discretion that violates the principle of equality (Art.14).
Whether s.54 and Rule 27 breach principles of natural justice by not providing a hearing to affected occupants.
Whether the power under s.54 is a quasi‑judicial power requiring a speaking order and observance of natural justice.

Legislation cited

Bombay Town Planning Act, 1954s. 53(a), s. 54
Bombay Town Planning Rules, 1955s. Rule 27
Employees' Provident Fund and Miscellaneous Provisions Act, 1952s. 14B

Subjects

constitutional validityArticle 14natural justicesummary evictioncorrective machineryappealrevisionquasi‑judicial powertown planningBombay Town Planning Act

Judgment

614

A

BABUBHAI & CO. & ORS.
B
v,

STATE OF GUJARAT & ORS

April 9, 1985
c
[V. D. TULZAPURKAR AND V. KHALID, JJ.]

Bo1nbay Town Planning Act 1954, ~· 54 read with Rule 27 of Bon1bay Town
Planning Rules 1955-Provision for s111nm.~ry e~iction of lands required for
public purpose-Absence of a cOrrective 1nachinery by way of appeal or revision-
validity of.
D
The respondent-State issued notice u/s. 54 of the Bombay Town Planning
Act 1954 (for short the Act) read with Rule 27 of the Bombay Town Planning
Rules 1955 (for ~hort the Rules) to the appellants to hand over possession of
their lands lying within the limits of .Borough Municipality (.t Ahmedabad to
the Municipal Corporation of Ahmedabad as the same had vested absolutely
E in the Municipal Corporation free from all encumbrance u/s. :53 (a) of the Act
and were required for construction of roads and other public purposes. The
appeallants challenged before the High Courf under Art. 226 tbe constitutional
validity of s. 54 of the Act and Rule 27 of the Rules. The High Court
dismissed the writ petitions holding ; (i) that the rights of tht~ local authority
(to own and obtain po5session of such lands~ wi.th the corn:sponding liability
of the occupants to suffer eviction therefrom did not exist under the general
F law prior to the making of the Final Scheme, that such rights and liabilities
were created for the first time by the Final Scheme which is te> be read as part
of the Act and since the Act while creating these new ri!!:hts and liabilities
provided for a special and particular remedy for enforcing them under s. 54,
the remedy of summary eviction must· be held to be an exclusive remedy and
the liability to eviction arising under s. 53 (a) or (b) cannot be enforced by ·the
ordinary remedy of a suit ; (ii) that s. 54 conferred upon the local
G authority a quasi-judicial power andnot administrative power and as
such it was bound, in conformity with the principh:s of natural justice,
to give an opportunity of hearing to the occupants before taking
the threatened action of summary eviction and therefore no question of
section being bad in law arose ; and (iii) that since Rule 27 did not contain
any express exclusion of such hearing and since s. f54 iimpliedly required the
observance of principles of natural justice on the part of 1the local authority
H
llABtlBHAI & CO. v. GtJJAR.At 6tS
while exerc1s1ng the power of summary eviction. the said requirement must
also be read in Rule 27 and so read the Rule could not be regarded as
ultra vires the section. A

Jn appeals to this Court, the appellants contended that even proceeding
on the basis that s. 54 impliedly required a hearing to be given and consequen-
tly such a requircn1ent could be read into Rule 27 which was a subordinate B
piece of legislation, there was no c6rrective machinery provided for by way
of an appeal or revision to any superior authority against an adverse order
that may be passed by the local authority acting under Rule 27 and in the
absence of any such corrective machinery the entire provision must be held
to be bad in l~w and therefore the impugned notices served on the appellants
sould be quashed.
c
Dismissing the appeals,

HELD : (1) Mere absence of a corrective machinery by way 'of appeal
or revision by itself would not make the Power unreasonable or arbitrary,
much less would render the provision invalid. Regard will have to be had to
several factors, such as, on whom the power is conferred whether on a high
official or a petty officer, what is the nature of the power.whether .the exercise
thereof depends upon the subjective satisfaction of the authority or body on D
whom it is conferred or is it to be exercised objectively by reference to some
existing facts or tests, whether or not it is a quasi-judicial power requiring
that authority or body to observe principles of natural justice and make a
speaking order etc. ; the last mentioned factor particularly .ensures application
of mind on the part of the authority or body only to pertinet or germane mate-
rial on the record excluding the extreneous and irrelevant and also subjects the F
order of the authority or body to a judicial review under the writ jurisdiction o-f
the Court on grounds of perversity, extraneous influence, malafides and other
blatant infirmities. Moreover all these facts will have to be considered in the
light of the scheme of the enactment and the purpose intended to be achieved
by the concerned provision. If on an examination of the scheme of the enact-
ment as also the purpose of the concerned provision it is found that the power
to decide or do a particular thing is conferred on a very minor or petty officer, E
that the exercise thereof by him depends on his subjective satisfaction, that he
is expected to exercise the power administratively without any obligation to
make a speaking order then, of courtse, the absence of a corrective machinery
will render the provision conferring such absolute and unfettered power
invalid. But it is the cumulative effect of all these factors that will render
the provision unreasonable or arbitrary and liable to be struck down.
[619F-H; 620A-D] G
(2) In the in"itant case, it is at the stage·of-execution of a town planning
scheme that the power of sumn1ary eviction of occupants who have ceased to
be entitled to occupy the plots in their occupation has been conferred upon
the Local Authority itself - a highly responsible body, and that the power is
required to be exercised by it ln objective manner (it is to be found by reference
to the Final Scheme and its interpretation Whether the occupants are occupying H
616 SUPREME COURT REPORTS [1985) 3 S.C.R.
A
lands which they are not entitled to occupy.) Further, as aJre<idy held by the
High Court, the pG~er conferred upon the iocal Authority i:i .a quasi-judicial
power which implies that the same has to be exercised after observing the
principles of natural justice, and that too by passing a speaking order which
implies giving of reasons and that ensures the application of mind to only
germane or relevant material on the record eschewing extraneous and irrelevant,
II' Moreover any order of summary eviction based on any extraneous, non-
gcrmanC, irrelevant or malafide consideration!. would be subject to the writ
jurisdiction of Court. [625E-H; 622A]

C.R. H. Readymoney Ltd. case in AIR 1956 Bombay 304, Chandrakant
Krishnarao's case, in [1962] 3 SCR 108, Lala Hari Chand Sarda's case, [1967]
I SCR 1012 ond Excel Wear's case in [1979] I SCR 1009, referred to

Organo Che1nical Industries & Another v. Union India and Others, relied
upon.

CIVIL APPELLATE JURISDICIION Civil Appeals Nos. 2084·
2089 (N) of 1972
CI From the Judgment dated 24.12.1971 of the High Court of
Gujarat in Special Civil Applications Nos. 650/71, 652-654/71, 81/71
and 64/71

Soli J. Sora'Jiee, Kamal Mehta, 4ditya Narayan and Mrs. A.K.
Verma for the Appellants

M.N. Phadke and R.N. Poddar for the Respondents.

S.T. Desai and H.S.Parihar for Respondent Nos. 2 & 3.

The Judgment of the Court was deliver,ed by
il
TULZAPURKAR, J. There is no substance in these appeals.
preferred by the appellants aginst a common judgment rendered in
a batch of writ petitions by the High Court on 24th December
1971 wherein the High Court has upheld the constitutic•nal validity
of s. 54 of the Bombay Town Planning Act 1954 (for short the
Act) and Rule 27 of the Bombay Town Planning Rules 1955 (for
short the Rules).

By a notification dated 21st July, 1965 the State Government
of Gujarat sanctioned the Final Town Planning Scheme in respect
H
BABUBHAI & C•). v. GUJARAT (Tulzapurkar, J.) 617

of certain areas lying within the limits of Borough Municipality of A
Ahmedabad and directed that the said Final Scheme shall come
into force on 1st September, 1965. The lands in the possession
of the appellants were allotted or reserved for construction of roads
and other public purposes in that Scheme and therefore, being·
lands required by the Municipal Corporation they vested absolutely
in Municipal Corporation (local authority) free from all encumbran- B
ces under s. 53 (a) of the Act. Thereafter by notices issued under
s.54 read with Rule 27 the Municipal Corportion called upon the·
appellants to hand over possession of the lands in their occupation,
which, since such vesting, they were not entitled to occupy ; in
other words, the procedure or the remedy for summary eviction of
1t--- the appellants was resorted to by the Municipal Corporation. c
'
By writ petitions filed under s. 226 of the Constitution the
appellants challenged the validity of these notices on two grounds :

(a) that s. 54 confers absolute discretion upon the local
authority to adopt for evicting the occupants of such D
lands either the normal remedy of a civil suit or the
drastic remedy of summary eviction under it without
any guide-lines being prescribed or indicated for the
exercise of such discretion and therefore the section
was violative of Art. 14 inasmuch as the local autho-
E
rity could pick and choose at its sweot will some of
such occupants for subjecting them to the more
drastic remedy;

(b) that s. 54 which provides for summary eviction by
service of notice contemplated thereunder was opposed F
to principles of natural justice inasmuch as no oppor-
tunity was contemplated to be afforded to the occu-
pants of such lands to show cause against the proposed
eviction and as such was bad in law ; and in any event
even ifs. 54 was, on proper construction held to 'in-
clude the affording of such opportunity Rule 27 was G
ultra vires the said section inasmuch as it laid down
the procedure which did not conform to principles
of natural justice.

The Hi!lh Court has negatived both the 11rounds of challenge. As · H
618 SUPREME COURT REPORTS ]1985] 3 S.C.R.

A regards ground (a), relying upon thedccisiou in Wolm-hampto;z New
Water Works case reported in (1859) 6 C.B. (N.S.l 336 and obser-
vations of .Willes J. therein (app~aring at page 356 of the Report)
the High Court took the view that the rights of the local authority
(to own and obtain possession of such lands) with the correspond-
B ing liability of the occupants to suffer eviction therefrom did not
exist under the law perior to the making of the Final Scheme, that
such rights and liabilities were created for the first time by the Final
Scheme which is to be read as part of the Act and since the Act
creating these new rights and liabilities provided for a special and
particular remedy for enforcing them under s. 54 the remedy of
c summary eviction must be held to be an exclusive re,medy and the
liability to eviction arising under s. 53 (a) or (b) cannot be enforced
by the ordinary remedy of a suit ; in other words, the remedy of
summary eviction under s. 54 having been held to be an exclusive
remedy the entire ground of challenge· disappeared. As regards
ground (b) the High Court took the view that s. 54 conferred
D upon the local authority a quasi-judicial power and not adminis-
trative power and as such it was bound, conformity with the princi-
ples of natural justice, to give an oppotunity of hearing to the
occupants before taking the threatened action of summary eviction
and therefore no question of section being bad in :taw arose ; as
regrds Rule 27 the High Court held that since the s.aid Rule did
E not contain any express exclusion of such hearing and since s. 54
impliedly required the observance of principles of natural justice
on the part of the local authority while exercising the power of
summary ·eviction, the said requirement must also be read in Rule
27 and so read the Rule could not be regarded as ultra vires the
section. The High Court also proceeded to indicate in what way>
F such hearing could be afforded by the local authority while acting
under the said Rtile. This is how the High Court upheld the
constitutional validity of s. 54 of the Act and Rule 27 or the Rules.

• Counsel for the appellants fairly conceded the validity of the
High Court's view on the first ground of challenge to '" 54. It was
G only in regard to the second ground or challenge that he pressed
one more aspect before us on the basis of which he contended that
s. 54 read with Rule 27 may have to be struckdown. He urged that
even proceeding on the basis that s. 54 impliedly required a hearing
to be given and consequently such a requirement could be read into
Rule 27 which was a subordinate piece of letiislation, there was nQ
H
BABUBHAI & co. v. GUJARAT (Tu/zapurkar, J.) 619

corrective machinery provided for by way of an appeal or revision A
to any superior authority against an adverse order that may be
passed by the local authority acting under Rule 27 and in the
absence of any such corrective machinery the entire provision must
be held to be bad in law and therefore the impugned notices served
on the appellants should be quashed. In _support of this contention
B
counsd relied upon three or four decisions in C. R.H. Readymoney
Ltd. case( 1) Chandrakant Krishnarao's case,(2) La/a Hari Chand
Sarda's case{3 J and Excel Wear' scase( 4 ) where a view has been
taken that in the absence of a provision for corrective machinery
by way of appeal or revision, the provision conferring a power to
decide or do a particular thing may have to be regarded as unreason- c
~·· able and or un-guided, .un-controlled and arbitrary and hence
violative of Article 14 of the Constitution. It is not possible to
accept the contention.

It cannot be disputed that the absence of a provision for a
corrective machinery by way of appeal or revision to a superior D
authority to rectify an adverse order passed by an authority or body
on whom the power is conferred may indicate that the power so
conferred is unreasonable or arbitrary but it is obvious that provid-
ing such corrective machinery is only one of the several ways in
which the power could be checked or controlled and its absence
E
will be one of the factors to be considered along with several others,
before coming to the conclusion that the power so conferred is
unreasonable or arbitrary ; in other words mere absence of a
corrective machinery by way of appeal or revision by itself would
not make the power unr.easonable or arbitrary, much less would
render the provison invalid. Regard will have to be had to several F
factor., such as, on whom\ the power is conferred-whether on a
high official or a petty officer, what is the nature of the power-
whether the exercise thereof depends upon the subjective satisfaction
of the authority or body on whom it is conferred or is it to be
exercised objectively· by reference to some existing facts or tests
whether or not it is a quasi-judicial power requiring that autl10rit; G
or body to observe principles of natural justice and make a

(I) A.LR. 1956 Born. 304
(2) [1962] 3 S C.R. 108
(3) (1967] I S.C.R.1012
(4) [1979] 1 S.C.R. 1009
620 SUPREME. COURT REPORTS (1985] 3 S,C.R.
A speaking order etc ; the last mentioned factor particularly ensures
application of mind on the part of the authority or body only to
pertinent or germane material on the record excluding the extra-
neous and irrelevant and also subjects the order of the authority or
body to a judicial review under the writ jurisdiction of the Court on·
grounds of perversity, extraneous influence, malafides and other
blatant infirmities. Moreover all these factors will have to be con-
sidered in the light of the scheme of tbc enactment and the purpose ••
intended to be achieved by the concerned provision. If on an

C:;
examination of the scheme of the enactment as -also the purpose of
the concerned provision it is found that the power to decide or .do
a particular thing is conferred on a very minor or petty officer, that
the exercise thereof by him depends on his subjective satisfaction,
that he is expected to exercisethe power administratively without
_,
'
any obligation to make ·a speaking order then, of course, the
absence of a corrective machinery will render the provision con·
ferring such absolute and unfettered.power invalid. But it is the·
cumulative effect of all these factors that will render the provision
unreasonable or arbitrary and liable to be struck down. In three
of the decisions referred to by counsel where the concerned pro-
vision was struck down the 'Cumulative effect of several factors that
were present· in each was taken into consideration by the Court,
while in C.R.H. Readymoncy's case the provision was held to be
valid.
E
In this behalf we' might mcfully ·refer to a decision of this
Court in Organo Chemical fndu•tries Another v. Union of llldia and
Others.(') In this cases. l4B of the Employees Provident Fund and
Miscellaneous Provisions Act 1952 which conferred power upon the
Central Provident Fund Commissioner to levy and recover punitive
F damages from a defaulting employer was challenged on the ground
that within the limit of 100% of the defaulted amount it conferred
naked and unguided power on the Commissioner to impose any
quantum of damages as he fancied that no reasons were required
to be given by him for such ·imposition and that no appellate or
revisional review was prescribed against any adverse order that may ·
G be made by him and as such the section was violative of Art. 14 of
the Constitution. Negativing the contention this Court took the

(1) r19so11 s.c.R. 61.
R,
~ ....
,:')
'.r'"
BADtJBHAI & co. v. GUJARAT (Tulzapurkar, J.~ ' 621
A
view that the power 'rnder the section had been conferred upon one
of the highest officials of the Government, that the power to impose
damages on a party after hearing him wa< .a quasi-judicial one that
observance of requirements of natural justice was implicit in•such
jurisdiction that one desideratum thereof was spelling out of the
reasons for the order to be made, th at giving of reasons ensured B
rational action on the part of the Officer· because reasons implied
relevant reasons necessitating the application of mind on the part
of the ·officer only to pertinent and germane material on record and
that once rea1ons were set out the order readily exposed itself to
the writ jurisdiction of the Court so that perversity, illiteracy,
extraneous influence, malafides and other blatant infirmities got c
caught and corre.cted. Under such circumstances this Court held
that the needs of the factual situation and the legal milieu were
such that the absenc·e of appellate review in no way militated
against the justice and reasonableness of the provision and that the
argument of arbitrariness on this score was untenable. f)

In the instant case on an examination of the Scheme of the
Act as also the purpose sought to be achieved by s. 54 it will appear
clear that the topic of making of town planning schemes is dealt
with in ss. 21 to 53 while s. 54 (and some of the following sections
like 55 and 71 to 78) deal with the aspect of the execution of town E
-planning schemes and it is at the stage of execution of a town
planning scheme that the· power of summary eviction of occupants
who have ceased to be entitled to occupy the plots in their occupa-
tion has been conferred upon the Local Authority itself-a .highly
responsible bo·dy, and that the power is required to be exercised by
F
it in objective manner (it is to be found by .reference to the Final
Scheme and its interpretation whether the occupants are occupying
lands which ·they are not entitled to occupy). Further we are in
agreement with the High Court that the power conferred upon the
Local Authority is a quasi-judicial power which implies that the
same has to be exercised after observing the principles of natural
justice, that is to say, the decision that the occupants are not G
entitled to occupy the plots in their occupation has to be arrived at
after hearing such occup.ants and that too by passing a speaking
order which implies giving of reasons and that ensures the appli-
cation of mind to only germane or relevant material on the record

.H
622 SUPREME COURT REPORTS [1985] 3 S.C.R.

A eschewing cxtranecus and irrelevant. Moreover any order of
summary eviction based on an.Y extraneous, non-germane, irrelevant
or malafide considerations would be subject to the writ jurisdiction
of Court. Having regard to these aspects, mere absence of
corrective machinery by way of appeal or review would not in
our view render the provision invalid.
B
In the result the appeals are dismissed with no order as to
costs.

c M.L.A. Appeals dismissed.

y-

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