K. H. NAZARversusMATHEW K. JACOB & ORS.

928                      [2019]REPORTS
               SUPREME COURT    14 S.C.R. 928             [2019] 14 S.C.R.


A                                K. H. NAZAR
                                           v.
                         MATHEW K. JACOB & ORS.
                      (Civil Appeal Nos.7699-7700 of 2019)
B                            SEPTEMBER 30, 2019
           [L. NAGESWARA RAO AND HEMANT GUPTA, JJ.]
             Kerala Land Reforms Act, 1963 – ss.2(5) and 81(1)(q) – Width
      and amplitude of the expression ‘commercial site’ – Appellant
      requested environmental clearance to carry out quarrying
C
      operations on land – Permission was granted – Writ petition was
      filed by Respondent Nos.1 & 2 – Respondents objected that the
      land in question cannot be used for a purpose other than plantation,
      especially for quarrying operations – Single Judge of the High
      Court doubted the correctness of the judgment passed by the
D     Division Bench of the High Court in State of Kerala v. Mohammedali
      Haji, which held that quarry falls within the ambit of ‘commercial
      site’ and it was exempted from the applicability of the Act – Single
      Judge referred the matter to the larger Bench – In the larger Bench,
      the majority opinion was in favour of the Respondent Nos.1 & .2
      and held that land which is used for quarrying is not covered by
E
      the expression ‘commercial site’, therefore, there can be no exemption
      of such land from the Act – On appeal, held: There is a definite
      distinction between the expression ‘lands’ and ‘sites’ in the context
      in which they have been used in the Act – Commercial sites read
      along with the other clauses dealing with sites clearly indicate that
F     land occupied by structure is described as ‘site’ – The expression
      ‘commercial site’ cannot take into its fold vacant lands, including
      lands used for the purpose of quarrying – It has a restrictive meaning
      in comparison to the other categories of ‘land’ in s.81 – Therefore,
      quarry cannot fit into the terms ‘commercial site’ – There is no error
      in the majority opinion of the Full Bench of the High Court – Appeals
G
      dismissed.
            Interpretation of Statutes – Beneficial legislation – Held:
      Provisions of a beneficial legislation have to be construed with a
      purpose-oriented approach – The Act should receive a liberal
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                                   928
         K. H. NAZAR v. MATHEW K. JACOB & ORS.                           929


construction to promote its objects – Also, literal construction of      A
the provisions of a beneficial legislation has to be avoided – It is
the Court’s duty to discern the intention of the legislature in making
the law – Once such an intention is ascertained, the statute should
receive a purposeful or functional interpretation – Exceptions to
beneficial legislation should be narrowly interpreted.
                                                                         B
      Dismissing the appeals, the Court
      HELD: 1. While interpreting a statute, the problem or
mischief that the statute was designed to remedy should first be
identified and then a construction that suppresses the problem
and advances the remedy should be adopted. It is settled law             C
that exemption clauses in beneficial or social welfare legislations
should be given strict construction. [Para 13] [939-F]
      2. There is no dispute that the Kerala Land Reforms Act,
1963 is a beneficial legislation. The extent of land that can be
held is fixed and any land in excess has to be surrendered to the        D
Government, which is distributed in favour of the landless in the
State. The interpretation of the provisions of the Act should be
in a manner which promote the said object. [Para 14] [940-B]
       3. Section 81 exempts among others, lands comprised of
mills, factories or workshops, lands occupied by educational             E
institutions, and lands owned by Universities, religious and
charitable institutions. House sites, sites of temples, churches
and mosques, sites of buildings including warehouses and
commercial sites are also exempted. There is a definite
distinction between the expressions ‘lands’ and ‘sites’ in the
context in which they have been used. Commercial sites read              F
along with the other clauses dealing with sites clearly indicate
that land occupied by structures is described as ‘site’. As stated
above, the other clauses in Section 81 dealing with sites are house
sites, temples, churches and mosques and buildings. As such,
the expression ‘commercial site’ cannot take into its fold vacant        G
lands, including lands used for the purpose of quarrying. It has a
restrictive meaning in comparison to the other categories of ‘land’
in Section 81. Therefore, quarry cannot fit into the terms
‘commercial site’. The Appellant contended that digging the land

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930            SUPREME COURT REPORTS                     [2019] 14 S.C.R.


A     for extracting stones is for a commercial purpose of making profit
      and hence quarry is a commercial site. This Court does not agree.
      A commercial site is a land on which there is a structure being
      utilized for an industrial or commercial purpose. Extension of
      the words ‘commercial site’ to quarries would result in defeating
      the purpose of the Act. [Para 15] [940-C-F]
B
            4. This Court upheld the view of the majority of the full
      Bench of the High Court that exemption of quarries by the
      Government under Section 81 (3) would not arise if quarries are
      covered by Section 81 (1) (q) of the Act. In other words, if quarries
      are commercial sites, the need for their exemption in public
C     interest does not arise. Section 81(3) of the Act empowers the
      Government to exempt lands for commercial purposes in public
      interest. The overriding power conferred on the Government to
      exempt lands from the applicability of the Act cannot be utilized
      for the purpose of interpretation of Section 81 (1) (q) which
D     exempts commercial sites from the purview of the Act. Section
      81 (1) (k) exempts unused lands of industrial or commercial
      undertakings at the time of commencement of the Act. The
      provision presupposes that an industrial or commercial
      undertaking was existing on the date of the commencement of
      the Act and there was some land set apart for the use of the
E     undertaking in future. The said land is exempted only if the land
      is used for the industrial or commercial purposes of the
      undertaking within the time to be fixed by the authority. If the
      land is not used for the purpose for which it was set apart, the
      exemption ceases to operate. It is clear from the above that
F     Section 81(1) (k) deals with a completely different type of land
      belonging to an industrial or commercial undertaking set apart
      for use of the said undertaking. Therefore, this Court is not in
      agreement with the support sought by the dissenting Judge from
      Section 81 (1) (k) to interpret the expression ‘commercial site’
      in Section 81 (1) (q). [Para 17] [941-A-D]
G
            Regional Executive, Kerala Fishermen’ Welfare Fund
            Board v. Fancy Food (1995) 4 SCC 34 ; Bombay Anand
            Bhavan Restaurant v. ESI Corporation (2009) 9 SCC
            61; Union of India v. Prabhakaran Vijay Kumar (2008)
            9 SCC 527 : [2008] 7 SCR 673 ; Workmen v. American
H
         K. H. NAZAR v. MATHEW K. JACOB & ORS.                         931


      Express International Banking Corpn. (1985) 4 SCC                A
      71 ; Bharat Singh v. Management of New Delhi
      Tuberculosis Centre (1986) 2 SCC 614 : [1986] 2 SCR
      169 ; Rajasthan SEB v. Associated Stone Industries
      (2006) 6 SCC 141 – relied on.
      State of Kerala v. K. A. Gangadharan (1977) 1 SCC                B
      208 : [1977] 1 SCR 960 ; Indian Performing Rights
      Society v. Sanjay Dalia (2015) 10 SCC 161 : [ 2015] 8
      SCR 210 ; Shivram A. Shiroor v. Radhabai Shantram
      Kowshik (1984) 1 SCC 588 ; Minister Administering
      the Crown Lands Act v. NSW Aboriginal Land Council
      [2008] HCA 48 – referred to.                                     C

      K. Krishnankutty v. State of Kerala and Others.
      CRP No.1245/1975 ; State of Kerala v. Mohammedali
      Haji (1996) 1 KLT 584(DB) ; One Earth One Life &
      Ors. v. State of Kerala WP (C) No. 28496 of 2016 –
      referred to.                                                     D

                       Case Law Reference
       [1977] 1 SCR 960           referred to         Para 10
       (1995) 4 SCC 34            relied on           Para 11
                                                                       E
       (2009) 9 SCC 61            relied on           Para 11
       [2008] 7 SCR 673           relied on           Para 11
       [1986] 2 SCR 169           relied on           Para 11
       (1985) 4 SCC 71            relied on           Para 12
                                                                       F
       [2015] 8 SCR 210           referred to         Para 13
       (1984) 1 SCC 588           referred to         Para 13
       (2006) 6 SCC 141           relied on           Para 18
      CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 7699-
                                                                       G
7700 of 2019
      From the Judgment and Order dated 16.11.2018 of the High Court
of Kerala at Ernakulam in Writ Petition No. (C) 17384/2017 and
Writ Petition No. (C) 18246/2017
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932                SUPREME COURT REPORTS                             [2019] 14 S.C.R.


A           K.V. Vishwanathan, Bechu Kurian Thomas, Sr. Advs., P. Vinay
      Kumar, Mukunda Rao, Martin Chacko and Enoch David, Advs. for the
      Appellant.
            Pallav Shishodia, Sr. Adv, Romy Chacko, Prashant Kumar, Shakti
      Chand Jaidwal, G. Prakash, Jishnu M.L., Mrs. Priyanka Prakash,
B     Mrs. Beena Prakash, Advs. for the Respondents.
                The Judgment of the Court was delivered by
                L. NAGESWARA RAO, J.
                Leave granted.
C            1. The width and amplitude of the expression ‘commercial site’ in
      Section 2 (5) and Section 81 (1) (q) of the Kerala Land Reforms Act,
      1963 (for short, “the Act”), falls for our consideration in these Appeals.
      Commercial sites are exempted from the purview of the Act. The question
      whether a rocky land which is used for quarrying purposes can be treated
D     as a ‘commercial site’ and thereby excluded from the applicability of the
      Act was answered by a learned Single Judge of the Kerala High Court
      by holding that mere blasting of rocks and conversion into metals does
      not render the area a ‘commercial site’.1 Twenty years after the said
      judgment, a Division Bench of the Kerala High Court took a different
      view. Quarrying was held to be a commercial operation involving the
E     process of manufacture. Hence, it was held that a quarry falls within the
      ambit of ‘commercial site’ and is exempted from the applicability of the
      Act. 2
             2. The Appellant requested environmental clearance for his quarry
      which was recommended in his favour by the District Expert Appraisal
F     Committee (DEAC) on 25.04.2017. Respondents No.1 and 2 filed a
      Writ Petition aggrieved by the said recommendation to permit quarry on
      land which was a plantation site. It is relevant to note that the Appellant’s
      land was exempted from the realm of the Act as it was a plantation.
      The objection of Respondent No.1 and 2 was that the Appellant cannot
      be permitted to use the land for a purpose other than plantation, especially
G
      for quarrying operations. After examining the judgments of the High
      Court in K. Krishnankutty v. State of Kerala and Others (supra) and
      State of Kerala v. Mohammedali Haji (supra), a learned Single Judge

      1
          K. Krishnankutty v. State of Kerala and Others. CRP No.1245/1975
H     2
          State of Kerala v. Mohammedali Haji. (1996) 1 KLT 584 (DB)
          K. H. NAZAR v. MATHEW K. JACOB & ORS.                               933
                  [L. NAGESWARA RAO, J.]

of the High Court of Kerala doubted the correctness of the latter judgment    A
in State of Kerala v. Mohammedali Haji (supra) and referred the
matter to a larger Bench.
       3. The Writ Petition filed by Respondent No.1 and 2 was heard
by a Full Bench of the Kerala High Court comprising three Judges.
The majority opinion was in favour of Respondent No.1 and 2. It was           B
held by the majority that the land which is used for quarrying is not
covered by the expression ‘commercial site’. Therefore, there can be
no exemption of such land from the applicability of the Act. The Appellant
is aggrieved by the said judgment of the Full Bench of the High Court.
       4. Mr. K. V. Vishwanathan, learned Senior Counsel for the              C
Appellant took us through the provisions of the Act including Sections
2(5), 81 and 83 to argue that a quarry is a commercial site, which is
exempted under Section 81 (1) (q) of the Act. He alluded to the statement
of objects and reasons to submit that the legislation was made to protect
the interests of all stake-holders. He referred to the meaning of the
words ‘commercial activities’ and ‘business’ to submit that the activity      D
of quarrying is done for profit. Hence, quarrying is a commercial activity.
According to him, there can be no distinction between activities done
above and below the surface of land for the purpose of deciding whether
land is a commercial site or not. He criticized the plurality opinion for
erroneously invoking the mischief rule. He commended the judgment             E
of the dissenting Judge for our acceptance. He emphasized that
environmental issues are not germane for interpretation of Sections 2
(5) and 81 (1) (q) of the Act.
       5. Mr. Pallav Shishodia, learned Senior Counsel appearing for
the State of Kerala resisted the submissions made on behalf of the            F
Appellant by submitting that the expression ‘commercial site’ is a term
of art and has to be interpreted on the basis of the context in which it is
used.
       6. Mr. Romy Chacko, learned counsel for the Respondent No.1
and 2 asserted that the Act is a beneficial legislation. When there is a      G
doubt about the meaning of expressions used in such a statute, literal
interpretation should be avoided and Courts should adopt the principles
of purposive construction. He submitted that the exemption provision
should be narrowly construed.

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934            SUPREME COURT REPORTS                        [2019] 14 S.C.R.


A            7. Before we consider the submissions made by the learned
      counsel, it is necessary to examine the provisions of the Act. Section 83
      of the Act provides that no person shall be entitled to own or hold or
      possess under a mortgage, lands in the aggregate in excess of the ceiling
      area with effect from the date notified by the Government of Kerala in
      the Gazette. The ceiling area of land is specified in Section 82 of the
B
      Act. Lands exempted under Section 81 shall be excluded from
      computation of the ceiling area as per Section 82 (6) of the Act. Section
      81 of the Act is as follows:
            81. Exemptions: - (1) the provisions of this Chapter shall not
            apply to-
C
            a) Lands owned or held by the Government of Kerala or the
            Government of any other State in India or the Government of
            India or a local authority [or the Cochin Port Trust] or any
            other authority which the Government may, in public interest,
            exempt, by notification in the Gazette, from the provisions of
D           this Chapter.
            [Provided that the exemption under this clause shall not apply
            to lands owned by the Government of Kerala and held by
            any person under lease whether current or time expired or
            otherwise.]
E
            Explanation I. – “Lands owned by the Government of Kerala”
            shall, for the purposes of this clause, have the same meaning
            as “Government lands” under sub-section (1) of Section 2 of
            the Kerala Government land Assignment Act, 1960 [but lands
            escheated to the Government and held by tenants entitled to
F           fixity of tenure under Section 13 shall not be deemed to be
            lands owned by the Government of Kerala;]
            Explanation II – Lands, the right, title and interest in respect
            of which have vested in the Government under sub-section
            (9) of Section 66 or Section 72, shall not be deemed to be
G           “lands owned by the Government of Kerala” for the purposes
            of this clause;]
            Explanation III - For the purposes of this clause, “other
            authority” shall include a corporation owned or controlled

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     K. H. NAZAR v. MATHEW K. JACOB & ORS.                         935
             [L. NAGESWARA RAO, J.]

by the Government of Kerala or the Government of any other         A
State in India or the Government of India;]
b) Lands taken under the management of the Court of Wards;
Provided that the exemption under this clause shall cease to
apply at the end of three years from the commencement of
this Act;                                                          B

c) Lands comprised of mills, factories or workshops and which
are necessary for the use of such mills, factories or workshops;
d)       Private forests;
e)       Plantations;                                              C
f)       x x x x
g)       x x x x
h) lands mortgaged to the Government, or to a co-operative
society (including a co-operative land mortgage bank)              D
registered or deemed to be registered under the Co-operative
Societies Act for the time being in force, or to the Kerala
Financial Corporation, or to the Kerala Industrial
Development Corporation, or to the State Small Industries
Corporation, as security for any loan advanced by the
Government or by such society or Corporation, so long as           E
the mortgage subsists:
provided that the exemption under this clause shall cease to
apply at the end of three years from the commencement of
this Act;
                                                                   F
i) lands purchased by the Kerala Co-operative Central Land
Mortgage Bank or a Primary Mortgage Bank under Section
18 of the Kerala Co-operative Land Mortgage Banks Act,
1960 [or by the Kerala State Co-operative Bank Ltd., or by a
primary agricultural credit co-operative society or by a
scheduled bank as defined in the Reserve Bank of India Act,        G
1934] so long as such lands continue in the possession of the
bank;
j) Lands purchased by the Kerala Financial Corporation or
lands the management of which has been taken over by that
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936     SUPREME COURT REPORTS                        [2019] 14 S.C.R.


A     Corporation, under Section 32 of the State Financial
      Corporations Act, 1951, so long as such lands remain in the
      ownership, or continue under the management, as the case
      may be, of the said Corporation:
      [provided that the exemption under this clause shall not apply
B     in the case of lands the management of which has been taken
      over by the Corporation on or after the 1st day of April, 1964;]
      k) lands belonging to or held by an industrial or commercial
      undertaking at the commencement of this Act, and set apart
      for use for the industrial or commercial purpose of the
C     undertaking:
      Provided that the exemption under this clause shall cease to
      apply if such land is not actually used for the purpose for
      which it has been set apart, within such time as the District
      Collector may, by notice to the undertaking, specify, in that
D     behalf;
      l) x x x x
      m) house sites, that is to say, sites occupied by dwelling houses
      and lands, wells, tanks and other structures necessary for
      the convenient employment of the dwelling houses.
E
      Explanation.- For the avoidance of doubt, it is hereby
      declared that a compound wall shall not be deemed to be a
      structure necessary for the convenient enjoyment of a dwelling
      house, if the land on which the dwelling house is situated
      and enclosed by the compound wall is more than the land
F     necessary for the convenient enjoyment of the dwelling house.
      n) x x x x
      o) sites of temples, churches, mosques and cemeteries and
      burial and burning grounds:
G     p) sites of buildings and including warehouses;
      q) commercial sites;
      r) land occupied by educational institutions including land
      necessary for the convenient use of the institutions and
      playgrounds attached to such institutions;
H
         K. H. NAZAR v. MATHEW K. JACOB & ORS.                             937
                 [L. NAGESWARA RAO, J.]

      s) lands vested in the Bhoodan Yagna Committee;                      A
      t)lands owned or held by-
      i. a University establishment by law; or
      ii a religious, charitable or educational institutions of a public
      nature; or                                                           B
      iii. a public trust which expression shall include a wakf;
      Provided that-
      (i) the entire income of such lands is appropriated for the
      University, institution or trust concerned, and
                                                                           C
      (ii) where the University, institution or trust come to hold the
      said lands after the commencement of this Act, the Government
      have certified previously that such lands are bona fide
      required for the purposes of the University, institution or trust,
      as the case may be; and
                                                                           D
      u) lands granted to defence personnel for gallantry.
      (2) [xxx]
      (3) The Government may if they are satisfied that it is necessary
      to do so in the public interest-
      (a) on account of any special use to which any land is put; or       E

      (b) on account of any land being bona fide required for the
      purpose of conversion into plantation or for the extension or
      preservation of an existing plantation or for any commercial,
      industrial, educational or charitable purpose, by notification
      in the Gazette, exempt such land from the provisions of this         F
      Chapter, subject to such restrictions and conditions as they
      may deem fit to impose:
      Provided that the land referred to in clause (b) shall be used
      for the purpose for which it is intended within such time as
      the Government may specify in that behalf; and, where the            G
      land is not so used within the time specified, the exemption
      shall cease to be in force.]
     8. In the present case, the Appellant is claiming exemption on the
ground that a quarry would fall within the sweep of ‘commercial site’ as
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938             SUPREME COURT REPORTS                             [2019] 14 S.C.R.


A     stated in Section 81 (1) (q). Commercial site is defined in Section 2 (5)
      as follows:
             ‘‘2(5) “commercial site” means any land (not being a
             kudiyiruppu or a kudikidappu or karaima) which is used
             principally for the purposes of any trade, commerce, industry,
B            manufacture or business;’’
              9. The Appellant contended that the definition of ‘commercial
      site’ is very wide and any land which is principally used for the purpose
      of trade, commerce, industry, manufacture or business is a commercial
      site. According to the Appellant, breaking of rock is a manufacturing
C     activity. Quarrying operations involve digging land and breaking of rocks
      into metal pieces. It was submitted that digging of land and breaking of
      rock is for a commercial activity and the sale of stones is for the purpose
      of trade and business. We are afraid that we cannot agree.
             10. The dominant legislative intent of the Act is the imposition of
D     ceiling on land holdings and distribution of excess land among landless
      people.3 Large number of people have no place of abode in the State of
      Kerala, which is known as God’s own country. To provide land to such
      landless people by taking it from those who possess in excess is the
      major objective of the Act.4

E            11. Provisions of a beneficial legislation have to be construed with
      a purpose-oriented approach. 5 The Act should receive a liberal
      construction to promote its objects.6 Also, literal construction of the
      provisions of a beneficial legislation has to be avoided. It is the Court’s
      duty to discern the intention of the legislature in making the law. Once
      such an intention is ascertained, the statute should receive a purposeful
F     or functional interpretation7.
             12. In the words of O. Chinnappa Reddy, J.8, the principles of
      statutory construction of beneficial legislation are as follows:
      3
        State of Kerala v. K. A. Gangadharan (1977) 1 SCC 208
      4
        One Earth One Life & Ors. v. State of Kerala, WP (C) No.28496 of 2016
G     5
        Regional Executive, Kerala Fishermen’ Welfare Fund Board v. Fancy Food, (1995)
      4 SCC 34
      6
        Bombay Anand Bhavan Restaurant v. ESI Corporation, (2009) 9 SCC 61 and Union
      of India v. Prabhakaran Vijay Kumar, (2008) 9 SCC 527
      7
        Bharat Singh v. Management of New Delhi Tuberculosis Centre, (1986) 2 SCC 614.
      8
        Workmen v. American Express International Banking Corpn. (1985) 4 SCC 71
H
           K. H. NAZAR v. MATHEW K. JACOB & ORS.                               939
                   [L. NAGESWARA RAO, J.]

       4. The principles of statutory construction are well settled.           A
       Words occurring in statutes of liberal import such as social
       welfare legislation and human rights’ legislation are not to
       be put in Procrustean beds or shrunk to Liliputian dimensions.
       In construing these legislations the imposture of literal
       construction must be avoided and the prodigality of its
                                                                               B
       misapplication must be recognised and reduced. Judges ought
       to be more concerned with the “colour”, the “content” and
       the “context” of such statutes (we have borrowed the words
       from Lord Wilberforce’s opinion in Prenn v. Simmonds [(1971)
       3 All ER 237] ). In the same opinion Lord Wilberforce pointed
       out that law is not to be left behind in some island of literal         C
       interpretation but is to enquire beyond the language,
       unisolated from the matrix of facts in which they are set; the
       law is not to be interpreted purely on internal linguistic
       considerations. In one of the cases cited before us, that is,
       Surendra Kumar Verma v. Central Government Industrial
                                                                               D
       Tribunal-cum-Labour Court [(1980) 4 SCC 443], we had
       occasion to say,
        “Semantic luxuries are misplaced in the interpretation of
       ‘bread and butter’ statutes. Welfare statutes must, of necessity,
       receive a broad interpretation. Where legislation is designed
       to give relief against certain kinds of mischief, the Court is          E
       not to make inroads by making etymological excursions.”
       13. While interpreting a statute, the problem or mischief that the
statute was designed to remedy should first be identified and then a
construction that suppresses the problem and advances the remedy should
be adopted.9 It is settled law that exemption clauses in beneficial or         F
social welfare legislations should be given strict construction10. It was
observed in Shivram A. Shiroor v. Radhabai Shantram Kowshik
(supra) that the exclusionary provisions in a beneficial legislation should
be construed strictly so as to give a wide amplitude to the principal object
of the legislation and to prevent its evasion on deceptive grounds.            G
Similarly, in Minister Administering the Crown Lands Act v. NSW
Aboriginal Land Council11, Kirby, J. held that the principle of providing
9
  Indian Performing Rights Society v. Sanjay Dalia, (2015) 10 SCC 161
10
   Shivram A. Shiroor v. Radhabai Shantram Kowshik, (1984) 1 SCC 588
11
    [2008] HCA 48                                                              H
940             SUPREME COURT REPORTS                          [2019] 14 S.C.R.


A     purposive construction to beneficial legislations mandates that exceptions
      in such legislations should be construed narrowly.
            14. There is no dispute that the Act is a beneficial legislation. The
      extent of land that can be held is fixed and any land in excess has to be
      surrendered to the Government, which is distributed in favour of the
B     landless people in the State. The interpretation of the provisions of the
      Act should be in a manner which promote the said object.
              15. Section 81 exempts among others, lands comprised of mills,
      factories or workshops, lands occupied by educational institutions, and
      lands owned by Universities, religious and charitable institutions. House
C     sites, sites of temples, churches and mosques, sites of buildings including
      warehouses and commercial sites are also exempted. There is a definite
      distinction between the expressions ‘lands’ and ‘sites’ in the context in
      which they have been used. Commercial sites read along with the other
      clauses dealing with sites clearly indicate that land occupied by structures
      is described as ‘site’. As stated above, the other clauses in Section 81
D     dealing with sites are house sites, temples, churches and mosques and
      buildings. As such, the expression ‘commercial site’ cannot take into its
      fold vacant lands, including lands used for the purpose of quarrying. It
      has a restrictive meaning in comparison to the other categories of ‘land’
      in Section 81. Therefore, quarry cannot fit into the terms ‘commercial
E     site’. Mr. Bechu Kurian, leaned Senior Counsel argued on behalf of the
      Appellant that digging the land for extracting stones is for a commercial
      purpose of making profit and hence quarry is a commercial site. We do
      not agree. A commercial site is a land on which there is a structure
      being utilized for an industrial or commercial purpose. Extension of the
      words ‘commercial site’ to quarries would result in defeating the purpose
F     of the Act.
             16. We disagree with the opinion of the dissenting Judge that the
      expression ‘commercial site’ should be attributed its natural and original
      meaning. On the basis of the statement made by the learned Additional
      Advocate General, the dissenting Judge held that if lands used for
G     quarrying operations prior to the Act coming into force stood exempted
      under Section 81 (1) (k), a quarry should be considered as commercial
      site. Further, it was observed that if a quarry can be exempted under
      Section 81 (3) by the Government in public interest, then quarrying is a
      commercial activity falling within the sweep of Section 81 (1) (q) of the
H     Act.
              K. H. NAZAR v. MATHEW K. JACOB & ORS.                              941
                      [L. NAGESWARA RAO, J.]

       17. We uphold the view of the majority that exemption of quarries         A
by the Government under Section 81 (3) would not arise if quarries are
covered by Section 81 (1) (q) of the Act. In other words, if quarries are
commercial sites, the need for their exemption in public interest does not
arise. Section 81(3) of the Act empowers the Government to exempt
lands for commercial purposes in public interest. The overriding power
                                                                                 B
conferred on the Government to exempt lands from the applicability of
the Act cannot be utilized for the purpose of interpretation of Section 81
(1) (q) which exempts commercial sites from the purview of the Act.
Section 81 (1) (k) exempts unused lands of industrial or commercial
undertakings at the time of commencement of the Act. The provision
presupposes that an industrial or commercial undertaking was existing            C
on the date of the commencement of the Act and there was some land
set apart for the use of the undertaking in future. The said land is exempted
only if the land is used for the industrial or commercial purposes of the
undertaking within the time to be fixed by the authority. If the land is not
used for the purpose for which it was set apart, the exemption ceases to
                                                                                 D
operate. It is clear from the above that Section 81(1) (k) deals with a
completely different type of land belonging to an industrial or commercial
undertaking set apart for use of the said undertaking. Therefore, we are
not in agreement with the support sought by the dissenting Judge from
Section 81 (1) (k) to interpret the expression ‘commercial site’ in Section
81 (1) (q).                                                                      E
        18. Another submission of the Appellant that quarrying includes a
manufacturing activity does not appeal to us. Breaking of rock into
small pieces of stone, according to us, is not a manufacturing activity.
For this view, we seek support from a judgment of this Court in Rajasthan
SEB v. Associated Stone Industries12. It was held in the said judgment           F
that cutting and polishing stones into slabs is not a process of manufacture
for the obvious and simple reason that no new and distinct commercial
product came into existence as the end product still remained stone and
thus its original identity continued.
       19. The findings recorded in the majority opinion on the issue            G
pertaining to the environment is not relevant for the decision of the dispute.
The concern of the Court should have been restricted to the gamut of
the expression ‘commercial site’. The interpretation of Section 81 which
exempts certain lands and sites should be interpreted in a manner, which
promotes the object of the Act and restricts concentration of large
12
     (2006) 6 SCC 141                                                            H
942                SUPREME COURT REPORTS                    [2019] 14 S.C.R.


A     swathes of land in favour of a few individuals. Wider construction of
      the words ‘commercial site’ would defeat the laudable object of the Act.
            20. The upshot of the above discussion is that there is no error in
      the majority opinion of the Full Bench in the impugned judgment which
      requires to be upheld.
B           21. The Appeals are dismissed, accordingly.


      Ankit Gyan                                               Appeals dismissed.



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