ORDER
1. Heard the learned Counsel on both sides.
2. In this writ petition the petitioners challenge the legality and validity of the notification under Section 4(1) and the declaration under Section 6 of the Land Acquisition Act and the consequent
proceedings initiated by the respondents for the acquisition of an extent of Acs.15.02 guntas of land belonging to the petitioners for the purpose of construction of a cement factory and colony by M/s. Visakha Cement Industries Ltd., Secunderabad, a company incorporated under the provisions of the Indian Companies Act, 1956. Section 4(1) notification in this behalf was published in the A.P. Gazette on 3-7-1997 proposing to acquire the extent of Acs.15.02 guntas in Survey No.56 belonging to the petitioners herein and also a further extent of Acs. 18.26 guntas in Survey No.60 belonging to others totalling Acs.33.2S gts. for the said purpose. The substance of the notification was published in the locality on 16-7-1997 and it is also published in two newspapers, namely, A.P. Times and Andhra Jyothi on 16-7-1997 and 17-7-1997 respectively. Invoking the urgency clause under Section 17(4) of the Act, the enquiry under Section 5-A of the Act was dispensed with and declaration under Section 6 was published in the A.P. Gazette on 10-7-1997. The same was published in the newspapers Andhra Jyothi and A.P, Times dated 23-7-1997. Notices under Section 9(1) and 10 were issued on 30-7-1997 proposing to hold an enquiry on 19-8-1997, The petitioners filed the present writ petition on 7-8-1997. By an interim order granted on 8-8-1997, this Court directed the respondents not to dispossess the petitioners from the lauds in question until further orders. The owners of the other extent of Acs. 18.26 gts. filed a separate writ petition being WP No. 19413 of 1997. On 18-8-1997, the petitioners are stated to have put in appearance through their Counsel before the Land Acquisition Officer. On 9-6-1998 notices under Section 9(3) and 10 of the L.A. Act were issued and served on the petitioners on 15-6-1998 requiring them to put in their statement showing the nature of their interest in the lands. Thereafter the Land Acquisition Officer passed an award on 21-8-1998 with regard to the entire extent of Acs.33.28 gts. After the award was passed, the other writ peiilion i.e., WP No.19413 of 1997 was dismissed as withdrawn on
26-10-1998 as the petitioners therein wanted to pursue their remedies by seeking reference under Section 18 of the Act. So far as the present writ petitioners are concerned, they filed objections before the Land Acquisition Officer on 8-9-1998 contending, inter alia, that in view of the stay orders granted by this Court, the award passed by the Land Acquisition Officer is illegal and without jurisdiction. However, subsequently without prejudice to their contentions in this writ petition, the petitioners filed an application before the Land Acquisition Officer on 2-10-1998 seeking reference to the civil Court under Section 18 of the Act claiming compensation at the rate of Rs.3,00,000/- per acre as against Rs.60,000/- awarded by the Land Acquisition Officer. After the dismissal of WP No.19413 of 1997, possession of the extent of Acs.18.26 gts. covered by the said writ petition is stated to have been taken over.
3. In this writ petition the land acquisition proceedings are sought to be challenged on various grounds. It is mainly contended that as the acquisition is for the purpose of a company, the procedure under Part VII of the Act has to be followed and the entire proceedings are illegal and void inasmuch as the said procedure has not been followed. It is further contended that the Visakha Cement Industries Ltd., has already acquired an extent of Acs.580.00 by private negotiation and resort to these instant proceedings through the instrumentality of the A.P. Industrial Infrastructure Corporation (APIIC) is nothing but a colourable exercise of power. It is also contended that Visakha Cement Industries Ltd., is no longer in existence now as it has been taken over by M/s. Indian Cements Ltd., and as such the avowed purpose for which the acquisition is sought to be made no longer survives. It is finally contended that the petitioners are small farmers and they do not possess any other land except this land and as each of the three petitioners owns only Acs.5.00 of land, they will be deprived of their livelihood if this land is acquired compulsorily.
4. The stand taken in the counter-affidavit is that in order to develop industries in the State, the APIIC is acquiring lands through Land Acquisition Act as per the orders issued by the State Government in G.O. Ms. No.235 Revenue (K) Department dated 10-3-1987 whereby the Government had delegated the powers of the Government to the Collectors in the Slate for the approval of the draft notification and draft declaration in the land acquisition cases of APIIC, that in Government memo dated 29-7-1989 the Government have dispensed with the screening committee approval for acquisition of lands by APIIC and that in Government memo dated 23-1 -1989, the Government have issued instructions for placing the funds before the Land Acquisition Officer after publication of the draft declaration in cases where the urgency clause is invoked. In the instant case, the APIIC sent a requisition to the District Collector, Rangareddy District on 4-2-1987 stating that the aforesaid extent of Acs.33.28 gts. of land is required for establishment/expansion of industrial estate and industrial development areas for allotment to M/s. Visakha Cement Industries Ltd., for cement factory and colony and that acting on the same, the District Collector, in exercise of the powers delegated to him in G.O. Ms. No.235 Revenue (K) Department dated 10-3-1987, issued the notification under Section 4(1) and also declaration under Section 6 after dispensing with the enquiry under Section 5-A. It is, therefore, contended by the respondents that as the acquisition proceedings are initiated on the request made by the APIIC for the purpose of industrial development, the acquisition is for a public purpose and as such the provisions of Part VII need not be followed. It is also stated that the entire compensation for the required land amounting to Rs.26,58,600/-vvas deposited by the APIIC Ltd., with the Land Acquisition Officer by means of a cheque on 31-7-1998 itself and there is no illegality whatsoever in the proceedings. It is also contended by the learned Government Pleader appearing for the respondents that
inasmuch as the award has already been passed on 21-8-1998, it is not permissible to challenge the notification under Section 4 and declaration under Section 6 and the remedy of the petitioners is only to seek a reference under Section 18 of the Act.
5. The learned Counsel for both parties have cited several judgments in support of their respective contentions.
6. The main question which arises for consideration is whether the instant acquisition is for a public purpose falling under Part II of the Land Acquisition Act or it is for the purpose of a company falling under Part VII of the Act.
7. As held by the Supreme Court in Babu Barkaya Thakur v. Stale of Bombay, , the Land Acquisition Act deals with two kinds of acquisitions: (1) for a public purpose at the cost of the Government, and (2) for a purpose akin to such a purpose at the cost of a company. To the latter clause of acquisition, the provisions of Part VII are attracted. It was further held in that case that acquisition of a site for building residential houses for industrial labour was a public purpose. In Jhandu Lal v. State of Punjab, a Constitution Bench of the Supreme Court held that essential condition for acquisilion for a public purpose is that the cost of the acquisition should be borne wholly or in part out of public funds. The Constitution Bench further held that an acquisition for a company may also be made for a public purpose within the meaning of the Act if a part or the whole of the cost of acquisition is met by public funds. In such a case, it is not necessary to go through the procedure prescribed by Part VII. If, on the other hand, the acquisition for a company is to be made at the cost entirely of the company itself, such an acquisition comes under the provisions of Part VII.
8. In Somavanti (Smt.) v. State of Punjab, , the facts were
that the Government of Punjab issued a notification under Section 4(1) acquiring the petitioners’ land for a private company to set up a factory to manufacture various ranges of refrigeration compressors and ancillary equipment. The Government contributed Rs.100/- from public exchequer. When it was questioned by a petitioner under Article 32, the Supreme Court held that it is for the State Government to decide about a public purpose. If the purpose is within the legislative competence, the declaration of the Government in that behalf will Be final, however, subject to one exception, being that if there is a colourable exercise of power, the declaration will be open to challenge at the instance of the aggrieved party. It was contended that when the Government contributed a token money and when the entire compensation of the land was to be met by a company, declaration under Section 6 would be a colourable exercise of the power and thereby the acquisition was mala fide and invalid. The Court held that whether such contribution meets the requirement of law would depend on the facts of every case. ‘Part’ does not necessarily mean a substantial part, and that it would be open to the Court in every case which comes before it to examine whether the contribution made by the State satisfies the requirement of law. In that case it was found that the company was to manufacture refrigeration equipment and its accessories which would save substantial part of foreign exchange and construction of the quarters for workmen would also be a public purpose. Accordingly it was held that though the company was a private company, acquisition was not a colourable device to avoid the rigour of Part VII.
9. In Manubhai Jethalal v. State of Gujarat, , the notification issued under Section 4(1) for acquiring the land for the Road Transport Corporation with a contribution of Re. 1/- from the State revenue was held to be for a public purpose with the State fund and it was not illusory so as to invalidate the acquisition.
10. The sheet-anchor of the arguments of the learned Counsel appearing for the petitioners is the decision of the Supreme Court in Srinivasa Co-operative House building Society Ltd. v. Madam Gurumurthy Sastry, . In that case the lands were sought to be acquired for the purpose of a Co-operative House Building Society and for transfer of the acquired land to the members of the society who are advocates, chartered-accountants, businessmen. It was held that it was not a public purpose and that the compulsory acquisition was vitiated by colourable exercise of power. I think that the said case is clearly distinguishable on facts and it is of no assistance to the petitioners in the present case. Even in that case it was held that whether the action was in colourable exercise of power or not would depend upon the facts and circumstances of each case. In the instant case, the APIIC Ltd., which is a corporation wholly owned and controlled by the Government, in order to develop industries in the State and to provide infrastructural facilities, is acquiring the lands through the Land Acquisition Act as per the Government orders and allotting the same to companies for utilisation of the same for a public purpose. As a part of the said scheme, the APIIC Ltd., sent a requisition for acquisition of these lands for allotment to Visakha Cement Industries Ltd., for the purpose of construction of the cement factory and colony for its workers. Industrial development is certainly a public purpose. Further the cost of acquisition is borne by the APIIC Ltd. It is, of course, not known whether the amount will be ultimately recovered from the company. In the judgment in WP No.20461 of 1998 dated 13-11-1998,1 had an occasion to consider the question whether the acquisition for the purpose of expansion of export promotional industrial park by the A.P. Industrial Infrastructure Corporation (APIIC), which is established for the purpose of setting up export-oriented industries, is for a public purpose. It was held that it is a public purpose.
11. For the aforesaid reasons I am satisfied that the provisions of Part VII of the Land Acquisition Act are not attracted to the instant case and the exercise of power cannot be characterised as a colourable exercise of power.
12. So tar as the contention that Visakha Cement Industries Ltd., is no longer in existence and it has been taken over by the M/s. India Cements Ltd. and as such the avowed purpose for which the acquisition is sought to be made no longer survives is concerned, it is stated to be a subsequent development after the filing of the writ petition which is mentioned by the petitioners for the first time in the reply-affidavit filed by them to the counter filed on behalf of the respondents. There is, however, nothing on record to show that the proposed construction of a factor in the acquired land is shelved or given up. Merely because there is change of management, it does not follow that the purpose of acquisition has disappeared altogether. I do not, therefore, find any substance in this contention.
13. As regards the contention that the petitioners are small farmers and as such their lands should not be acquired, when the acquisition is needed for a public purpose and it is inevitable, the same cannot be avoided or invalidated on the ground of hardship to the petitioners. The petitioners have an effective alternative remedy by way of reference under Section 18 of She Land Acquisition Act to claim appropriate compensation for the land. The petitioners have, in fact, filed an application in this behalf before the Land Acquisition Officer though without prejudice to their contentions in this writ petition.
14. It is finally submitted by the learned Counsel for the petitioners that in view of the slay order granted by the Court, the award passed by the Land Acquisition Officer during the pendency of this writ petition is illegal and without jurisdiction. In support of this
contention, reliance is sought to be placed on the judgment of the Supreme Court in Municipal Corporation, Delhi v. Lichho Devi, . In that case a contention was raised that the entire land acquisition proceedings lapsed as no award was passed within the time prescribed in Section 11-A and the order passed by the High Court staying dispossession of the land-owners did not preclude the passing of award within the time by the Land Acquisition Officer. The Supreme Court repelled the said contention observing that the stay order of the type granted by the High Court tantamounts to stay of further proceedings being taken and therefore, the entire period during which the stay order was in operation shall be excluded while computing the period of two years prescribed for making an award under Section 11-A of the Act. These observations of the Supreme Court, in my view, cannot be held to be laying down as a proposition that any award passed in the face of such an order of a limited stay of dispossession will be illegal and without jurisdiction. I do not, therefore, find any force in this submission of the learned Counsel for the petitioners.
15. For all the aforesaid reasons, the writ petition is disposed of with a direction to the Land Acquisition Officer to make a reference under Section 18 of the Land Acquisition Act with regard to the proper compensation payable to the petitioners in respect of the land which is acquired without being inhibited by the question of limitation inasmuch as the petitioners have already filed an application in this behalf before the Land Acquisition Officer on 2-10-1998 itself. The Land Acquisition Officer shall make the reference within one month, from the date of receipt of this order.
There will be no order as to costs.
Writ Petition No. 18720 of 1997
ORDER
1. On the matter being mentioned before me to-day, the learned Counsel for the petitioners has stated that
there is now standing red gram crop in the lands, raised by the petitioners and if they were to be dispossessed from the lands before the crop is harvested, they will be put to great hardship and loss and it lakes some time before the crop will be ripe for harvest.
2. Under these circumstances, the petitioner is permitted to make a representation in this behalf to the Special Deputy Collector-Land Acquisition Officer. If any such representation is made by the petitioners, the Land Acquisition Officer shall consider the same and allow the petitioners to harvest the standing crop, if any, on the land at the appropriate time, on the petitioners furnishing an undertaking to the Land Acquisition Officer that they will vacate the land immediately after harvesting the crop. This order, however may not be construed as taking away the right of the petitioners to prefer an appeal, if they so choose, against the order passed in this writ petition.