Supreme Court of India
STATE OF TAMIL NADU AND ORS.versusANANTHI AMMAL AND ORS.
- Citation
- 1994 INSC 532
- Decided
- 22 November 1994
- Disposal
- Appeal(s) allowed
- Bench
- S VERMA
Holding
The Act is constitutionally valid except for the instalment payment provision in Section 11(1), which is struck down as violative of Article 14.
Summary
The State of Tamil Nadu enacted the Tamil Nadu Acquisition of Land for Harijan Welfare Schemes Act, 1978 to acquire land for Harijan welfare projects. The Act was challenged as unconstitutional, alleging violations of Articles 14, 19 and 300A of the Constitution and lack of protection under Articles 31A and 31C. The Madras High Court struck down the Act, holding it arbitrary and unreasonable. On appeal, the Supreme Court examined the Act's provisions, comparing them with the Land Acquisition Act, 1894, and held that most provisions, including the method of determining market value and the right to appeal, were reasonable and intra vires. However, the Court found the clause in Section 11(1) that mandated payment of compensation in instalments (except for amounts up to Rs. 2,000) to be arbitrary and struck it down as violative of Article 14. The remainder of the Act was upheld, and the High Court's order was set aside in part.
Issues considered
- Whether the Tamil Nadu Acquisition of Land for Harijan Welfare Schemes Act, 1978 violates Article 14 of the Constitution.
- Whether the Act is protected by Articles 31A and 31C.
- Whether the provisions of the Act, particularly Section 11(1) regarding instalment payment of compensation, are arbitrary or unreasonable.
- Whether the Act's procedures for acquisition, compensation, and appeal are consistent with the Land Acquisition Act, 1894.
Legislation cited
- Code of Civil Procedure, 1908
- Constitution of Indias. Article 14, s. Article 19, s. Article 300A, s. Article 31A, s. Article 31C
- Land Acquisition Act, 1894
- Tamil Nadu Acquisition of Land for Harijan Welfare Schemes Act, 1978s. 10, s. 11, s. 12, s. 13, s. 2, s. 20, s. 22, s. 3, s. 4, s. 5, s. 6, s. 7, s. 8, s. 9
Subjects
Constitutional lawArticle 14Land acquisitionCompensationHarijan welfareSection 11 instalment clauseArticle 31AArticle 31CTamil Nadu
Judgment
A STATE OF TAMIL NADU AND ORS.
v.
ANANTHI AMMAL AND ORS.
NOVEMBER 22, 1994
B [J.S. VERMA, S.P. BHARUCHA AND K.S. PARIPOORNAN, JJ.]
Constitution of India-Article 14-Tamil Nadu Acquisition oflandfor
Harijan Welfare Schemes Act, 1978--Constitutional validity-
Cha/lenged-Held, Except for provisions of Section 11 (1) insofar as they
provide for payment of compensation in instalments, the Act is intra vires
c the Constitution-Provisions of section 11 (1) subsequent to words 'in a
lump-sum' struck down.
This appeal was filed by the State against the judgment and order
of the High Court whereby the Tamil Nadu Acquisition of Land for
D Harijan Welfare Schemes Act, 1978, was struck down as being ultra
vires the Constitution of India. The High Court came to the conclusion
that the Act did not enjoy the protection of Articles 31-C or 31-A and
that it was violative of Articles 14, 19 and 300 A of the Constitution.
The appellants submitted that the Act was not violative of Articles
E 14 or 19 or 300-A and that, in any event, it was protect~d by reason of
Article 31A. ·
The· respondents submitted that the Act was violative of Article 14
inasmuch as it was enacted to acquire lands for a purpose which could
as well be served by the provisions of the Land Acquisition Act, 1894,
F and that a comparison of the provisions of the said Act with those of
the Land Acquisition Act showed that the provisions of the said Act
were far harsher insofar as the land owner was concerned. It was
further submitted that the said Act did not enjoy the protection
conferred by Article 31C notwithstanding the declaration in that behalf
G contained in Section 2 thereof.
It was further submitted that no enquiry required by Section 5 of
the Land Acquisition Act was contemplated by the said Act. Whereas it
was the Government which was required to consider objections and the
need for acquisition and make a declaration thereafter that the land
H was required for a publi.c purpose under .the Land Acquisition Act, it
666
__J
STATE v. ANANTHI AMMAL 667
was, under the said Act, left to the District Collector to be satisfied that A
the land was required for the purpose of a Harijan Welfare Scheme. No
enquiry into the value of the land was contemplated under the said Act
inasmuch as a provision equivalent to section 11 of the Land
Acquisition Act was not to be found in the said Act. Whereas the Land
Acquisition Act set out the matter:; that were required to be considered
for the purposes of award of compensation there was no such provision B
in the said Act. The said Act did not provide for a reference to the court
in regard to a claim for enhancement of compensation in the manner of
section 18 of the Land Acquisition Act; it provided only for an appeal
to the court and, having regard to the terms of Section 9, that appeal
was restricted to the amount of solatium payable under section 7(2) of C
the said Act. Section 11 of the said Act provided for the payment of the
compensation amount in instalments in the event that the amount
thereof exceeded Rs. 2,000. Section 13 of the said Act provided for a
second appeal to the High Court only if the amount as determined by
the prescribed authority exceeded such sum as might be prescribed.
This sum was at the relevant time Rs. 50,000 which was the amount D
prescribed for the purposes of all second appeals to the High Court -
under the rules for the purpose.
Allowing the appeal, this Court ·
HELD : 1.1. When a statute is impugned under Article 14 of the E
Constitution of India what the court has to decide is whether the statute
is so arbitrary or unreasonable that it must be struck down. At best, a
statute upon a similar subject which derives its authority from another
source can be referred to, if its provisions have been said held to be
reasonable or have stood the test of time, only for the purpose of
indicating what may be said to be reasonable in the context. (674 D) F
State ofMP. v. G.C. Mandewar, [1955) 1SCR599.
- Sant Lal Bharti v. State of Punjab, [1988) 2 SCR 107, relied on.
1.2. The provisions of section 4 of the Tamil Nadu Acquisition of G
Land for Harijan Welfare Schemes Act, 1978 substantially encapsulate
the provisions of sections 4 to 6 of the Land Acquisition Act, the only
major difference being that, under the said Act, it is the District
Collector an~ not the State Government who must be satisfied that the
land is required to be acquired. This provision is not unreasonable or
arbitrary. (675 B) H
668 SUPREME COURT REPORTS [1994] SUPP. 5 S.C.R.
A 1.3. What is payable as compensation is the market value of the
land and it is to be determined as on the date on which the notice under
section ~(1) is published. To that extent the pro.visions of the said Act
are more favourable than those of the Land Acquisition Act for, under
that statute, market value as on the date of Section 4 notification is
payable, not on the date of the Section 6 notification. (675 D, E)
B
It is true that the said Act provides for matters which are to be
ignored in determining the amount under section 8 but does not make
provision, as the Land Acquisition Act does, in respect of matters which
are to be taken into account in determining the amount. It has,
however, to be realised that the concept of market value and how it is
C to be determined is well established. (675 F)
It is, therefore, of no great consequence that the said Act does not
go on to specify what is to be taken into account in determining the
amount payable as compensation for land that is acquired thereunder.
(675 H, 676 A)
D 1.4. That no reference as in Section 18 of the Land Acquisition Act
in regard to the amount of compensation for land that is acquired is
provided for, does not make the said Act unreasonable. Under the
provisions of the Land Acquisition Act the award is no more than an
offer. If the land owner or other person interested in the land does not
accept the offer, section 18 gives him the right of having the
E compensation amount decided by the court. The market value is
required to be determined, by reason of sub-section (3) of section 7,
upon an enquiry. The land owner or other person interested in the land
has, therefore, the opportunity to establish its market vafoe before the
prescribed authority. Such evidence as he places before the prescribed
authority becomes a part of the record of the court in appeal under
F section 9. The court in appeal under section 9 would also, in
appropriate cases, have the right to call for additional evidence.
(676 H, 677 A, C)
Raja Harishchandra Raj Singh v. Dy. Land Acquisition Officer, (1962)
1 SCR 676 and Periyar and Parsskanni Rubbers Ltd.. v. State of Kera/a
G (1991) 1sec495, relied on.
1.5. By reason of sub-section (1) Section 11 payment of the
compensation amount can be made in a lump sum only where it does
not exceed Rs. 2000. In all other cases it must be made in equal annual
instalments not exceeding five, but so that the amount of such annual
H instalment is not less then Rs. 2,000. The provision in regard to the
STATE v. ANANTHI AMMAL [BHARCUHA, J.] 669
payment of the compensation amount by instalments in this manner'ls A
wholly unreasonable. The owner of the land or another person
interested therein would require compensation in lieu of the land
forthwith to re-establish himself, whether in a new residence or an
another piece of agricultural land or otherwise. The provisions of the
section in this behalf are clearly severable. The said Act can stand even
when the provisions in regard to the payment of the compensation B
amount by instalments are excised. To the extent that section 11
provides for payment of compensation by instalments it is ultra vires
Article 14. The provisions of section 11(1) subsequent to the words "in
a lump-sum" must, therefore, be struck down. (677 F-H, 678 A)
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3322of1981 C
etc. etc.
From the Judgment and Order dated 9.9.81 of the Madras High Court
in W.P. No. 797of1980.
K.N. Bhatt, R. Sundaravaradhan, S.Siva Subramaniam, A.
Mariarputham, Mrs. Aruna Mathur, Dr. A. Francis Julian, S. Balakrishnan, D
S. Prasad, Ramesh Keshwani, M.K.D. Namboodiri, S.P. Shanna, R. Ayam
Perumal, R. Nedumaran, Sri Narayan, for Intervenor, Ms Hemantika Wahi,
Ambrish Kumar, Pravir Choudhary, V. Balachandran, A.T.M. Sampath, S.
Srinivasan, B. Kanta Rao, R.N. Keshwani, M.A. Krishnamurthy and K.R.
Chowdhary for the appearing parties.
E
The Judgment of the Court was delivered by
BHARCUHA, J. Civil Appeal No. 3312of1981.
This appeal by special leave is filed by the State of Tamil Nadu against
the judgment and order of the High Court of Madras dated 9th September, F
1981, whereby the Tamil Nadu Acquisition of Land for Harijan Welfare
Schemes Act, 1978, was struck down as being ultra-vires the Constitution
of India. The High Court came to the conclusion that the said Act did not
enjoy the protection of Articles 31-C or 31-A and that it was violative of
Articles 14, 19 and 300A of the Constitution.
G
Learned counsel for the appellants submitted that the said Act was not
violative of Articles 14 or 19 or 300A and that, in any event, it was
protected by reason of Article 31-A. Learned counsel for the respondents
submitted that the said Act was violative of Article 14 inasmuch as it was
enacted to acquire lands for a purpose which could as well be served by the
provisions of the Land Acquisition Act, 1894, and that a comparison of the H
670 SUPREME COURT REPORTS [1994) SUPP. 5 S.C.R
provisions of the said Act with those of the Land Acquisition Act showed
that the provisions of the said Act were for harsher insofar as the land
owner was concerned. Learned counsel for the respondents also submitted
that the said Act did not enjoy the protection conferred by Article 31 C
notwithstanding the declaration in that behalf contained in Section 2
thereof.
B ~
The said Act contains in section 2 the declaration aforementioned,
namely, that it is enacted to give effect to the policy of the State towards
securing the principles laid down in Part IV and, in particular, Article 46 of
the Constitution. It is enacted to provide for acquisition of land for Harijan
Welfare Schemes.
c
Section 3 of the said Act is the definition section. It defines Court to
mean, in the City of Madras, the Madras City Civil Court and els~where,
the Subordinate Judge's Court having jurisdiction, and if there is no such
Subordinate Judge's Court, the District Court having jurisdiction. A
"Harijan Welfare Scheme" is defined to mean any scheme for provision of
D house sites for Harijans, for constructing, extending or improving any
dwelling house for Harijans; for providing any burial or burning ground for
Harijans, for providing any pathway leading to such dwelling house, burial
or burning ground or for providing any other amenity for the benefit of
Harijans. Sections 4, 5, 6 and 7 of the said Act read thus :
E "4. Power to acquire land - (1) Where the District Collector is
satisfied that for the purpose of any Harijan Welfare
S!=heme, it is necessary to acquire any land, he may acquire
the land by publishing in the District Gazette a notice to the
effect that he has decided to acquire the land in pursuance
of this section.
F
(2) Before publishing a notice under sub-section {I), the
District Collector or any officer authorised by the District
Collector in this behalf, shall call upon the owner ot any
other person, who in the opinion of the District Collector or
G the officer so authorised may be interested in such land, to
show cause why it should not be acquired.
(3) (a) The District Collector may, where he has himself called
upon the owner or other person to show cause under sub-
section (2), pass such orders as he may deem fit on the
H cause so shown;
STATE v. ANANTHI AMMAL [BHARCUHA, J.] 671
(b) Where any officer authorised by the District Collector has A
called upon the owner or other person to show cause under
sub-section (2), the officer so authorised shall make a report
to the District Collector containing his recommendations on
the cause so shown for the decision of the District Collector.
After considering such report the District Collector may
pass such orders as he may deem fit. B
5. Land acquired to vest in Government free from all
encumbrances - When a notice under sub-section (1) of
section 4 is published in the District Gazette, the land to
which the said notice relates shall, on and from the date on
which the notice is so published vest absolutely in the C
Government free from all encumbrances.
6. Right to receive amount - Every person having any interest
in any land acquired under this Act shall be entitled to
receive and be paid an amount as hereinafter provided.
D
7. Determination of amount - (1) The amount payable in
respect of any land acquired under this Act shall be the
market value of such land on the date of publication of the
notice under sub-section (1) of section 4.
Section 8 sets out the matters that are to be ignored in determining the E
amount under section 7. Section 9 entitles any person who does not agree
with the amount determined by the prescribed authority under sec!ion 7(2)
to prefer an appeal to the "Court" within such period as may be prescribed.
Sub-section (1) of the section l 0 requires the prescribed authority to
de~ermine who, in his opinion, are entitled to receive the amount where
several persons claim to be interested therein and what is payable to each of F
them. Sub-section (2) states that where a dispute arises in this behalf the
prescribed authority may refer it for the decision of the court and the court
must, in deciding such dispute, follow the provisions of Part III of the Land
Acquisition Act. Section 11 reads thus:
"l l. Payment of amount - ( l) After the amount has been G
determined, the prescribed authority shall tender payment
of the amount to the persons entitled thereto and shall pay it
to them-
(i) in a lump-sum in a case where it does not exceed two
thousand rupees, and H
672 SUPREME COURT REPORTS [1994] SUPP. 5 S.C.R
A (ii) in all other cases, in such number of equal annual
instalments not exceeding five as may be determined by the
prescribed authority and. the amount of each such annual
instalment shall not be less then two thousand rupees;
Provided that where the balance of the amount due in any
B ·instalme~t is less than two thousand rupees, only the actual
amount so due shall be paid.
(2) If the persons entitled to the amount do not consent to
receive it or if there be no person competent to alienate the
land, or if there by any dispute as to the title to receive the
c amount, or as to the apportionment of it, the prescribed
authority shall deposit the amount in the Court, and the
Court shall deal with the amount so deposited in the manner
laid down in sections 32 and 33 of the Land Acquisition
Act, 1894 (Central Act I of 1894)."
D Section 12 provides for payment of interest. It says that when the
compensation amount is not paid or deposited on or before taking
possession of the land, the prescribed authority shall pay it with interest at
the rate of 6% per annum from the time of taking possession until payment.
Section 13 reads thus :
E "13. Appeal to High Court - Subject to the provisions of the
Code of Civil Procedure, 1908 (Central Act V of 1908)
applicable to appeals from original decrees, and
notwithstanding anything to the contrary in any enactment
for the time being in force, a second appeal shall lie to the
High Court from any decision of the Court under this Act, if
F the amount as determined by the prescribed authority
exceeds such sum as may be prescribed."
Section 20 states that the provisions of the Land A~quisition Act, 1894,
save as provided in the said Act, shall cease to apply to any land which is
required for the purpose specified in section 4(1) and such land shall be
G acquired only in accordance with the provisions of the said Act. Section 22
reads thus:
''22. Application of the Act to certain pending cases of
acquisition - ( 1) The provisions of this Act shall apply also
to any case or cases in which proceedings have been started
H before the commencement of this Act for the acquisition of
STATE v. ANANTHI AMMAL [BHARCUHA, J.] 673
any land for the Harijan Welfare Scheme under the Land A
Acquisition Act, 1894 (Central Act I of 1894) (hereinafter
in this sectfon referred to as the said Act, but no award has
been made by the Collector under section 11 of the said Act
before such commencement, as if-
(i) the notification published under sub-section ( l) of section 4 B
of the said Act, or
(ii) the declaration made under section 6 of the said Act, or
(iii) the notice given under sub-section (1) of section 9 of the
said Act,
c
were a notice to show-cause against the acquisition of the
land served under sub-section (2) of section 4 of this Act.
(2) Nothing contained in sub-section (l) shall apply in relation
to any land unless and until after the District Collector has
published a notice in the District Gazette to the effect that
D
the said land is required for the purpose specified in sub-
section ( l) of section 4 of this Act.
It was submitted by learned counsel for the respondents that no enquiry
as required by section 5 of the Land Acquisition Act was contemplated by E
the said Act. Whereas it was the Government which was required to
consider objections and the need for acquisition and make a declaration
thereafter that the land was required for a public purpose under the Land
Acquisition Act, it was, under the said Act, left to the District Collector to
be satisfied that the land was required for the purpose of a Harijan Welfare
Scheme. No enquiry into the value of the land was contemplated under the F
said Act inasmuch as a provision equivalent to section 11 of the Land
Acquisition Act was not to be found in the said Act. Whereas the Land
Acquisition Act set out the matters that were required to be considered for
the purposes of award of compensation there was no such provision in the
said Act. The said Act did not provide for a reference to the court in regard
to a claim for enhancement of compensation in the manner of section is of G
the Land Acquisition Act; it provided only for an appeal to the court and,
having regard to the terms of section 9, that appeal was restricted to the
amount of solatium payable under section 7(2) of the said Act. Section 11
of the said Act provided for the payment of the compensation amount in
instalments in the event that the amount thereof exceeded Rs. 2,000.
Section 13 of the said Act provided for a second appeal to the High Court H
674 SUPREME COURT REPORTS [1994] SUPP. 5 S.C.R
A only if the amount as detennined by the prescribed authority exceeded such
sum as might be prescribed. This sum, it may be mentioned, was at the
relevant time Rs. 50,000, which was the amount prescribed for ~e purposes
of all second appeals to the High Court under the rules for the purpose.
In The State of Madhya Pradesh v. G.C. Mandawar, (1955] I S.C.R.
B 599, a Constitution Bench held that Article 14 does not authorise the
striking down of the law of one State on the ground that, in contrast with
the law of another State on the same subject, its provisions are
discriminatory, nor does it contemplate the law of the Centre or of a State
dealuig with similar subjects being held to be unconstitutional by a process
of comparative study of the provisions of the two. The sources·ofauthority
c for the two being different, Article 14 can have no application. In Sant Lal
Bharti v. State ofPunjab, [ 1988] 2 S.C.R. 107, this was reiterated.
When a statute is impugned under Article 14 what the court has to
decide is whether the statute is so arbitrary or unreasonable that it must be
struck down. At best, a statute upon a similar subject which derives its
D authority from another source can be referred to, if its provisions have been
held to be reasonable or have stood the test of time, only for the purpose of
indicating what may be said to be reasonable in the context. We proceed to
examine the provisions of the said Act ufx>n this basis.
Sub-section (1) of section 4 empowers the District Collector, if he is
E satisfied that it is necessary to acquire some land for the purpose of an
Harijan Welfare Scheme, to acquire that land by publishing in the District
Gazette a notice to the effect that he has decided to acquire it in pursuance
of section 4. Sub-section (2) of section 4 obliges the District Collector or
any officer authorised by him in tl!is behalf to call upon the owner or any
other person who, in the opinion of the District Collector or the officer so
F authorised, is interested in such land to show cause why it should not be
acquired. Where the District Collector has called upon the owner or other
person to show cause under sub-section (2), clause (a)" of sub-section (3)
requires him to pass orders on the cause so shown, where an officer
authorised by the District Collector has called upon the owner or other
person to show cause under sub-section (2), clause (b) of section 3 requires
G
that officer to report to the District Collector his recommendations on the
cause so shown and the District Collector is required to pass such orders as
he may deem fit after considering the report. Sub-section (2) of section 4,
therefore, obliges the acquiring authority to serve notice upon the land
owner and other persons interested in the land to show cause why it should
H not be acquired. By reason of sub-section (3) of section 4, s~ch cause has to
STATE v. ANANTHI AMMAL [BHARCUHA, J.] 675
be taken ·into account and orders passed in respect thereof. It is only A
thereafter that the acquiring authority can arrive at the satisfaction that it is
necessary to acquire the land. The provisions of section 4, substantially
encapsulate the provisions of sections 4 to 6 of the Land Acquisition Act,
the only major difference being that, under the said Act, it is the District
Collector and not the State Government who must be satisfied that the land
is required to be acquired. It does not appear to us that this is a provision B
which is unreasonable or arbitrary.
By reason of section 5, the land in respect of which notice under
section 4 (I) is published vests absolutely in the State Government on and
from the date of such publication. Every person having an interest in such
land is, by reason of section 6, entitled to receive compensation. Section 12 C
says that whe.-e the amount thereof is not paid or deposited on or before the
taking of possession of the land, interest thereon is payable at the rate of 6%
per annum from the time of taking of possession until payment or deposit.
Section 7 states that the amount payable in respect of land that is
acquired under the said Act "shall be the market value of such land on the D
date of publication of the notice under sub-section (I) of section 4". What is
payable as compensation is the market value of the land and it is to be
determined as on the date on which the notice under section 4( I) is
published. To that extent the provisions of the said Act are more favourable
than those of the Land Acquisition Act for, under that statute, market value E
as on the date of the Section 4 notification is payable, not on the date of the
Section 6 notification.
It i.s true that the said Act provides for matters which are to be ignored
in determining the amount under section 6 but does not make provision, as
the Land Acquisition Act does, in respect of matters which are to be taken F
into account in determining the amount. It has, however, to be realised that
the concept of market value and how it is to be determined is well
established. In State o/Gujarat v. Shanti/a/ Mangaldas and Ors., [1969] 3
S.C.R. 341, this Court said, "Specification of principles [within the
meaning of Article 31(2) as it then read] means laying down general
guiding rules applicable to all persons or transactions governed thereby. G
Under the Land Acquisition Act compensation is determined on the basis of
"market value" of the land on the date of the notification under section 4( l)
of the Act. That is a specification of principle. Compensation determined on
the basis of market value prevailing on a date anterior to the date of
extinction of interest is still determined on a principle specified." It is,
therefore, of no great consequence that the said Act does not go on to H
676 SUPREME COURT REPORTS [1994] SUPP. 5 S.C.R
A specify what is to be taken into account in determining the amount payable .
as compensation for land that is acquired thereunder.
Sub-section (1) of section 7, as aforesaid, states that the amount
payable in respect of the land that is acquired under the said Act shall be its
market value on the date of publication of the notice under section 4(1).
B Sub-section (2) of section 7 states that, in addition ·to the market value of
the land, the prescribed authority shall in every case award a sum of 15 per
centum on such ·market value as solatium in consideration of the
compulsory nature of the acquisition. Sub-section (3) of section 7 states that
the prescribed authority shall, after holding an inquiry in the prescribed
manner, determine by order the amount payable under sub-section (1) and a
c copy of the said order shall be communicated to the owner of such land and
every person interested therein. The purport of section 7, read as a whole, is
that the market value of the land is payable as compensation and sub-
section (3) states that the market value shall be determined after holding an
inquiry in the prescribed manner. Necessarily, that enquiry contemplates
notice to the owner and other persons interested in the land and
D consideration of their claims for compensation and the basis thereof,
namely, the evidence they adduce. Upon determination of the market value
of the land after inquiry, the prescribed authority is obliged under sub-
section (2) of section 7 to award as compensation for the acquisition the
market value and an additional 15% as solatium.
E An appeal is prescribed under section 9 to the court by any person, who
does not agree with the amount ·determined by the prescribed authority
"under sub-section (2) of section 7". It was argued that the appeal was
limited to the award of solatium and that, therefore, there was no appeal
against the determination of market value and no reference to the court in
that behalf in the manner of section 18 of the Land Acquisition Act. We do
F not think that sections 7 and 9 may be so read as to render section 9 an
. absurdity. As aforesa:d, it is the obligation of the prescribed authority under
sub-section (2) of section 7 to award the market value of the land plus 15%
as solatium. The appeal contemplated by section 9 is, therefore, in respect
of the award in respect of ·the land which comprises its market value ancl
G solatium.
That no reference as in Section 18 of the Land Acquisition Act in
regard to the amount of compensation for land that is acquired is provided
for does not, in our view, make the said Act unreasonable. Under the
provisions of the Land Acquisition Act the award is not more than an offer.
H If the land owner or other person interested in the land does not accept the
STATE v. ANANTHI AMMAL [BHARCUHA, J.] 677
offer, section 18 gives him the right of having the compensation amount A
decided by the court. (See Raja Harish Chandra Raj Singh v. The Deputy
Land Acquisition Officer, [1962] l S.C.R. 676). In the reference court
compensation has to be established. (See Periyar and Parsskanni Rubbers
Ltd, v. State of Kera/a, [1991] 4 S.C.C. 195.) The record before the
Collector does not ipso facto become the record of the reference court. In
the case of the said Act an appeal is provided under section 9 from the B
award, that is, the market value of the land and solatium, under section 7.
The market value is required to be detennined, by reason of sub-section (3)
of section 7, upon an enquiry as hereinabove explained. The land owner or
other person interested in the land has, therefore, the opportunity to
establish its market value before the prescribed authority. Such evidence as
he places before the prescribed authority becomes a part of the record of the C
court in appeal under section 9. The court in appeal under section 9 would
also, in appropriate cases, have the right to call for additional evidence.
The provisions of section 13 of the Act provide for a second appeal to
the High Court. The second appeal lies only if the amount as detennined by
the prescribed authority exceeds such sum as may be prescribed. The sum D
prescribed appears to be the sum which is otherwise prescribed in regard to
all second appeals. There is no obligation to provide for a second appeal in
all cases and there is, therefore, no unreasonableness in this behalf.
In the event that the court in appeal under section 9 or the High Court E
in second appeal under section 13 enhances the compensation amount the
power to award interest as prescribed in section 12 is implicit.
Section 11 has already been quoted. By reason of sub-section (l)
thereof, payment of the compensation amount can be made in a lump sum
only where it does not exceed Rs. 2000. In all other cases it must be made F
in equal annual instalments not exceeding five, but so that the amount of
each annual instalment is not less than Rs. 2,000. In our view, the provision
in regard to the payment of the compensation amount by instalments in this
manner is wholly unreasonable. The owner of the land or another person
interested therein would require compensation in lieu of the land forthwith
to re-establish himself, whether in a new residence or an another piece of G
agricultural land or otherwise. The provisions of the section in this behalf
are clearly severable. The said Act can stand even when the provisions in
regard to the payment of the compensation amount by instalments are
excised. To the extent that section 11 provides for payment of
compensation by instalments it is ultra vires Article 14. The provisions of H
678 SUPREME COURT REPORTS [1994] SUPP. 5 S.C:R ·
A section 11(1) subsequent to the words "in a lump-sum" must, therefore, be
struck down.
Section 20 of the said Act states that the provisions of the Land
Acquisition Act, save as expressly provided in the said Act, shall cease to
apply to any land which is required for the purpose specified in section 4(1)
B and such land shall be acquired only in accordance with the provisions of
the said Act. Consequently, section 22 makes the provisions of the said Act
applicable also to cases in which proceedings have been started before the
commencement of the said Act under the Land Acquisition Act for the
purposes of Harijan W~lfare Scheme, provided that no awards have been
under the Land Acquisition Act. We see no unreasonableness in this
c provision, particularly having regard to the terms of section 20. We must,
however take account the fact that the judgment under appeal striking down
the said Act was delivered as far as back as September, 1981, and no stay
thereof was obtained from this court. It is likely, therefore, that in cases
where proceedings under the Land Acquisition Act had already been started
D to acquire lands for Harijan Welfare Schemes, they might have been
revived and completed in the interregnum. We, therefore, make it clear that
the provisions of section 22 shall have no effect in such cases where awards
have been made.
In the result, we do not find the provisions of the said Act, except for
E the provision as to instalments in section 11, violative of the provisions of
Article 14 of the Constitution of India. It is, therefore, unnecessary to
consider whether or not the said Act has the protection of Article 31- C of
the Constitution.
The appeal is allowed in part. The judgment and order under appeal is
F set aside. Except for the provisions of section 11 (I) of the said Act insofar
as they provide for payment of the compensation amount in instalments, the
said Act is intra vires the Constitution. Section 11(1) is valid only to this
extent:
"11. Payment of amount - (1) After the amount has been
G determined, the prescribed authority shall tender payment
of the amount to the persons entitled thereto and shall pay it
to them-
(i) in a lump-sum."
H The rest of Section 11 ( 1) is ultra vires the Constitution.
STATE v. ANANTHI AMMAL [BHARCUHA, J.] 679
CIVIL APPEALS 4461 OF 1984, 3978-4302 OF 1990 and 2114 OF A
1991.
These civil appeals arise out of orders of the Madras High Court that,
fo!Iowing the judgment dated 9th September, 1981, aforementioned, struck
down the said Act. Having regard to the discussion set out above, we have
held the said Act to be valid legislation, except in so far as the provisions of B
Section 11 (I) thereof require the payment of the compensation amount in
instalments. For the same reasons, these appeals are allowed and the orders
under appeal are set aside. Except for the provisions of Section 11 (I) of the
said Act in so far as they provide for payment of the compensation amount
in instalments, the said Act is intra vires the Constitution. Section 11 (I) is C
valid only to this extent:
" 11. Payment of amount - ( 1) After the amount has been
detennined, the prescribed authority shall tender payment
of the amount to the persons entitled thereto and shall pay it
to them- D
(i) in a lump-sum."
The rest· of Section 11 ( l) is intra vires the Constitution.
CIVIL APPEAL (NOS.) 7886-7891OF1994 (Arising out of S.L.P. (C) E
Nos. 16729 - 34of1983).
Leave granted.
The judgment and order of the Madras High Court under appeal in
these civil appeals, following the aforementioned judgment dated 9th F
September, 1981, struck down the provisions of Chapter VI of the Tamil
Nadu Slum Areas (Improvement and Clearance) Act, 1971. The provisions
of Chapter VI deal with the acquisition of land for the purposes of slum
clearance. The provisions of Chapter VI are substantially similar to the
provisions of the said Act, that is to say, the Tamil Nadu Acquisition of G
Land for Harijan Welfare Scheme Act, 1978, except that, by reason of
Section 21, no solatium is payable to the land owner whose land is
acquired. The Madras High Court, relying on the judgment dated 9th
September, 1981, in relation to the said Act, found the provisions of
Chapter VI to be violative of Article 14 of the Constitution and struck them
down. H
680 SUPREME COURT REPORTS (1994] SUPP. 5 S.C.R
A We have held the provision of the said Act to be intra vires the
Constitution, except in regard to the provision for payment of the
compensation amount in instalments. The Slum Clearance Act does not
provide for payment of the compensation amount in instalments.
That no solatium is payable under the Slum Cle~ance Act does not, in
B our view, make any substantial differences. In Prakash Amichand Shah v.
&ate of Gujarat and Ors., [1983] Suppl. 3 SCR 1025, a Constitution Bench
held that it could not be said as a rule that the State, which has to supply
and maintain large public services at great cost, should always pay, in
addition to reasonable compensation for acquired land, some amount by
c way of solatium; the interest of the public was equally important. It is, to
our mind, not unreasonable that the State should not have to pay solatium in
consideration of the compulsory nature of the acquisition of land that is
slum land.
In the result, the appeals are allowed and the provisions of Chapter VI
D of the Slum Clearance Act are held to be intra vires the Constitution.
CIVIL APPEAL NO. 7885 OF 1994 (Arising out of S.L.P. (C) No.
16986of1991).
Leave granted.
E
This is an appeal by the owner of land whose land was sought to be
acquired under the provisions of the Land Acquisition Act for the purposes
of a Harijan Welfare Scheme after the coming into force of the said Act,
that is, the Tamil Nadu Acquisition of Lands for Harijan Welfare Scheme
Act, 1978. The appellant filed a writ petition in the Madras High Court for
F a direction to the State to forbear from continuing with the proceedings
under the Land Acquisition Act having regard to the provisions of Section
20 of the said Act which required that for such purpose land could be
acquired only in accordance with the provisions of the said Act. The
learned single Judge dismissed the writ petition and the Division Bench the
appeal filed therefrom, both on the ground that the said Act had been struck
G
down as unconstitutional. Hence this appeal.
We have held the provisions of the said Act to be valid legislation,
except in so far .as they provide for payment of the compensation amount in
instalments. The said Act being valid legislation, its provisions preclude the
H State from acquilrh1g land for the purposes of a Harijan Welfare Scheme
l
STATE v. ANANTHI AMMAL [BHARCUHA, J.] 681
under the Land Acquisition Act. The appeal is allowed and the proceedings A
under the Land Acquisition Act to acquire the appellant's land for the
purposes of a Harijan Welfare Scheme are, therefore, quashed and set aside.
In all these civil appeals each party shall bear and pay its own costs.
A.G. Appeal allowed. B
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