TMI Blog1967 (9) TMI 145X X X X Extracts X X X X X X X X Extracts X X X X ..... poses. It is common case that this plot of land was acquired for the construction of a road leading to a military aerodrome at Juhu during the last war. The land originally belonged to the husband of the first respondent who claims to have succeeded to it by virtue of a will. The owner of the plot was receiving compensation for the requisition until December 29, 1952 when a notification was issued under s. 7(1) of the Requisitioning and Acquisition of Immovable Property Act enacted on March 14, 1952, hereinafter referred to as the Act. The notification was to the effect that the land was being acquired I by the Government of India, Ministry of Works, Housing and Supply, that it would vest in the Government from the date of the notification and there was a declaration of vesting in the notification itself. As a result of the notification. the owner of the land became entitled to claim compensation. The second respondent, hereinafter referred to as the Collector of Bombay, offered compensation at the rate of ₹ 11 per sq. yard on February 20, 1961. The petitioner, the first respondent herein, claimed at the rate of ₹ 100 per sq. yard plus the usual 15 % solatium for compul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acted. it was to remain in force for a period of twelve years from the date of its institution, but subsequently its life has been prolonged till the 14th of March 1970. S. 24 of the Act repealed several enactments therein mentioned, but any property which immediately before such repeal J(N)6 SCT-4 was subject to requisition under the provision of any of the said Acts was to be deemed to be property requisitioned under s. 3 of the Act and all the provisions of the Act were to apply accordingly. It is agreed between the parties that the property which was originally requisitioned in 1942 was to be treated as requisitioned under s. 3 of the Act. Under s. 7(1) it became competent to the Central Government, if it was of opinion that it was necessary to acquire the property already subjected to requisition for a public purpose, to acquire the same by publishing in the Official Gazette a notice to the effect that the Central Government had decided to acquire the property in pursuance of the section. The proviso to this sub-section is to the effect that before such a notice is issued the Central Government must call upon the owner or other persons interested in the property to show cause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consist of (a) a recurring payment, in respect of the period of requisition, of a sum equal to the rent which would have been payable for the use and occupation of the property if it had been taken on lease for that period: and (b) such sum or sums. if any, as may be found necessary to compensate the person interested for all or any of the following matters. namely: (i) pecuniary loss due to requisitioning; (ii) expenses on account of vacating the requisitioned premises; (iii) expenses on account of reoccupying the premises upon release from requisition; and (iv) damages (other than normal wear and tear) caused to the property during the period of requisition, including the expenses that may have to be incurred for restoring the property to the condition in which it was at the time of requisition'. (3) The compensation payable for the acquisition of any property under section 7 shall be (a) the price which the requisitioned property would have fetched in the open market. if it had remained in the same condition as it was at the time of requisitioning and been sold on the date of acquisition, or (b) twice the price which the requisitioned property woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p the true value of the property appropriated and exclude matters which are to be neglected, is a justiciable issue to be adjudicated by the court. The Court held that the fixing of the market value on December 31, 1946, as the ceiling on compensation, without reference to the value of the land at the time of the acquisition was arbitrary and not in compliance with the requirements of Art. 31(2). The learned Chief Justice went on to add: The fixing of an anterior date for the ascertainment of value may not, in certain circumstances, be a violation of the constitutional requirement as, for instance, when the proposed scheme of acquisitio n becomes known before it is launched and prices rise sharply in anticipation of the benefits to be derived under it, but the fixing of an anterior date, which might have no relation to the value of the land when it is acquired, may be, many years later, cannot but be regarded as arbitrary.................. Any principle for determining compensation which denies to the owner this increment in value cannot result in the ascertainment of the true equivalent of the land appropriated. In State of Madras v. D. Namasivaya Mudaliar([1964] 6 S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ust indemnification of the expropriated owner so as to be immune from attack, does not call for comment in this case. But any principle for determination of compensation denying to the owner all increments in value between a fixed date and the date of issue of the notification under s. 4(1), must prima facie, be regarded as denying to him the true equivalent of the land which is expropriated and it is for the State to show that fixation of compensation on the market value on an anterior date does not amount to a violation of the Constitutional guarantee. After noting that it was a matter of common knowledge that land values had risen steeply after the last world war, the judgment proceeded : To deny to the owner of the land compensation at rates which justly indemnify him for his loss by awarding him compensation at rates prevailing ten years before the date on which the notification under S. 4(1) was issued amounts in the circumstances to a flagrant infringement of the fundamental right of the owner of the land under Art. 31(2) as it stood when the Act was enacted. On October 5, 1964 judgments were delivered in two cases where the law on the subject came to be examined ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the award, he shall have regard to the circumstances of each case and the provisions of subsections (2) and (3). so far as they are applicable; was merely directory. It was said that the use of the expression shall have regard to so far as sub-ss. (2) and (3) were concerned ,only indicated that the arbitrator was to keep the said provisions .in mind but he was not bound to guide himself strictly thereby. According to the shorter Oxford Dictionary the phrase have regard to is used when 'reference to a person or thing' is' intended. The exact significance of this phrase will depend on the context and the setting in which it is used. The phrase finds a place in numerous sections of the Madras Estates Land Act discussed -elaborately in Ryots of Garabandho v. Zemindar of Parlakimedi(2) There it was observed by the Judicial Committee of the Privy Council that the expression have regard to or expressions very close to this were scattered throughout this Act, but the exact force of each phrase must be considered in relation to its context :and to its own subject matter. Consequently in considering the matters to which the arbitrator appointed under s. 8 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Madras v. D. Namasivaya Mudaliar([1964] 6 S.C.R. 936), Vajrevalu Mudaliar v. Special Deputy Collector([1965] 1 S.C.R. 614) and Jeejeebhoy v. Assistant Collector([1965] 1 S.C.R. 636 ), the date for the assessment of compensation was mentioned in the Act itself. In this case it is not so mentioned but such date is dependent on the original requisition. In any case it does not give the person to be compensated a just equivalent of the property he was losing at the date of acquisition. In this case too, it can be said that the just equivalent was frozen at the minimum of twice its value on, the date of requisition. It is common knowledge that all over India there has been a spiralling of land prices after the conclusion of the last world war although the inflation has been greater in urban areas, specially round about the big cities. than in the mofussil. .Land values in post-war India are many times the corresponding values before the conclusion of the last war. In assessing the just equivalent of the value of the property at twice the price which the requisitioned property would have fetched in the open market if it had been sold on the date of requisition, the arbitrator would b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n payable to a licensee on whom an order had been served under s. 4 or whose undertaking had been taken over before the commencement of the Act, would be determined under any of the Bases A, B and C specified by the section as might be chosen under s. 8. Then followed detailed provisions about these three Bases. The Court found that in none of the three bases does the Legislature refer to the market value of the undertaking. But according to the ,Court that itself cannot justify the argument that what is intended to be paid by way of compensation must necessarily mean much less than the market value. The failure ;of the legislature to refer to the fair market value cannot, in our opinion, be regarded as conclusive or even presumptive evidence of the fact that what is intended to be paid under S. 5 does not amount to a just equivalent ;Of the undertaking taken over. After all, in considering the question as to whether compensation payable under one or the other of the Bases amounts to just equivalent, we must try to assess what would be payable under the ,,said basis. The argument on behalf of the appellant that tile basis did not provide for the payment of just equivalent co ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
