{"id":130681,"date":"2009-03-23T00:00:00","date_gmt":"2009-03-22T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/urmila-roy-ors-vs-ms-bengal-peerless-on-23-march-2009"},"modified":"2018-12-28T20:38:56","modified_gmt":"2018-12-28T15:08:56","slug":"urmila-roy-ors-vs-ms-bengal-peerless-on-23-march-2009","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/urmila-roy-ors-vs-ms-bengal-peerless-on-23-march-2009","title":{"rendered":"Urmila Roy & Ors vs M\/S Bengal Peerless … on 23 March, 2009"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Urmila Roy & Ors vs M\/S Bengal Peerless … on 23 March, 2009<\/div>\n
Author: H S Bedi<\/div>\n
Bench: Tarun Chatterjee, Harjit Singh Bedi<\/div>\n
                                                    REPORTABLE\n\n\n\n           IN THE SUPREME COURT OF INDIA\n           CIVIL APPELLATE JURISDICTION\n           CIVIL APPEAL NOS. 1780-1781 OF 2009\n     (Arising out of SLP) Nos.16336-16337 of 2007)\n\n\n\nUrmila Roy & Ors.                        ......Appellants\n\n                      Versus\n\nM\/s. Bengal Peerless Housing Development\nCompany Ltd. & Ors.                   ...... Respondents\n\n\n\n                      JUDGMENT\n<\/pre>\n
HARJIT SINGH BEDI, J.\n<\/p>\n
1.   Leave granted.\n<\/p>\n
2.   This judgment will dispose of civil appeals arising out of<\/p>\n
judgment dated 2nd July, 2007 rendered by a Division Bench<\/p>\n
of the Calcutta High Court.\n<\/p>\n
3.   The facts are as under: Appellant Urmila Roy and others<\/p>\n
in W.P No.1002 (W) of 2002 were the writ petitioners before<\/p>\n
the Single Bench of the Calcutta High Court. As per the facts,<\/p>\n
6.78 acres of land had been purchased by them avowedly for
\n                              2<\/span><\/p>\n
putting up an International School, a cultural centre, an I.T.<\/p>\n
Park and a Housing Complex and for this purpose they had<\/p>\n
been in negotiations with the West Bengal Housing Board<\/p>\n
(hereinafter referred to as “The Housing Board”). It appears,<\/p>\n
however, that before the project could be finalized, the State<\/p>\n
Government issued a Notification under Section 4(1) of the<\/p>\n
Land Acquisition Act, 1894 (hereinafter referred to as “the<\/p>\n
Act”) on 4th December, 2000 seeking to acquire in all 12.67<\/p>\n
acres (including 6.78 acres belonging to the writ petitioners)<\/p>\n
for a housing scheme.       The land owner appellants were<\/p>\n
allegedly given to understand by the Housing Board that in<\/p>\n
the event that they did not object to the acquisition, they too<\/p>\n
would be permitted to participate in the proposed project. It is<\/p>\n
the case of the land owners that on account of this assurance,<\/p>\n
they did not raise any serious objection to the acquisition,<\/p>\n
where after a declaration under Section 6 (1) of the Act dated<\/p>\n
29th November, 2001 has issued and published in the Asian<\/p>\n
Age on 4th December, 2001. It is further the case of the land<\/p>\n
owners that they realized later that they had been cheated as<\/p>\n
the land had been acquired for the development and
\n                                3<\/span><\/p>\n
implementation    of    a   housing   scheme   by   the   Housing<\/p>\n
Development Co. Ltd. (hereinafter referred to as “The Bengal<\/p>\n
Peerless”). The Collector subsequently i.e. on 22nd December,<\/p>\n
2003 passed an Award determining the compensation payable<\/p>\n
and it is the case of the land owners that they first came to<\/p>\n
know of the award on receipt of a notice dated 16th February,<\/p>\n
2004 whereby they were informed that as the ownership of the<\/p>\n
acquired land could not be ascertained, the compensation had<\/p>\n
been deposited with the Reference Court under Section 31(2)<\/p>\n
of the Act. The land owners thereupon filed Writ Petition No.<\/p>\n
10051(W) of 2004 challenging the acquisition proceedings<\/p>\n
pleading inter-alia that the said proceedings had lapsed by<\/p>\n
efflux of time under Section 11-A of the Act as the declaration<\/p>\n
under Section 6 of the Act had been as published on          29th<\/p>\n
November, 2001 and the Award had been made on 22nd<\/p>\n
December, 2003.        It was also pleaded that the declaration<\/p>\n
under Section 6(2) of the Act had not been published in the<\/p>\n
manner provided.       It was further pleaded that the land had<\/p>\n
been acquired under the garb of a public purpose whereas it<\/p>\n
was intended to benefit the Bengal Peerless, a private party
\n                                  4<\/span><\/p>\n
and an attempt had been made to camouflage the identity of<\/p>\n
the beneficiary as it had not been specified in the Notifications<\/p>\n
issued under Sections 4 and 6 of the Act and had been<\/p>\n
brought out for the first time in the Notification under Section<\/p>\n
9 and in this view of the matter, the land owners had been<\/p>\n
deprived   of   their    rights   to   file   appropriate   objections.<\/p>\n
Cumulatively, it was submitted that in view of the facts, the<\/p>\n
acquisition itself was a colourable exercise of power at the<\/p>\n
instance of the State.\n<\/p>\n
4.   These matters were considered by a learned Single Judge<\/p>\n
of the Culcutta High Court, who, by his Judgment dated 16th<\/p>\n
September, 2003 concluded that the Notifications under<\/p>\n
Sections 4 and 6 had been properly published as required by<\/p>\n
law, that the land had been acquired for a public purpose, as<\/p>\n
detailed in the Notification under Section 4 of the Act and that<\/p>\n
the State Government was authorized to entrust the housing<\/p>\n
project to a Joint Sector Company to execute the housing<\/p>\n
scheme with the sanction of the State Government under<\/p>\n
Section 27A of the West Bengal Housing Board Act, 1972<\/p>\n
(hereinafter referred to as “the 1972 Act”).            The Learned
\n                              5<\/span><\/p>\n
Judge, however, observed that the proposal for the housing<\/p>\n
scheme had been initiated by the Bengal Peerless without the<\/p>\n
approval of the State Government and the fact that the<\/p>\n
entrustment to the Bengal Peerless was in public interest had<\/p>\n
not been examined by the State Government, and as the<\/p>\n
scheme itself did not disclose the budget or detail adequately<\/p>\n
the residential accommodation that was to be constructed for<\/p>\n
the low and middle income groups, the scheme itself was<\/p>\n
faulty and finally concluded that it appeared from the record<\/p>\n
that the intention of the Government was to enable Bengal<\/p>\n
Peerless to make huge profits and as such the acquisition was<\/p>\n
not for a public purpose and was, therefore, malafide.     The<\/p>\n
learned Single Judge accordingly allowed the writ petition vide<\/p>\n
judgment dated 18th May, 2004.\n<\/p>\n
5.   The matter was thereafter taken before a Division Bench<\/p>\n
in   FMA   No.   671   of   2004   (Bengal   Peerless   Housing<\/p>\n
Development Co.Ltd. vs.Urmila Roy & Ors. ), FMA 672 of 2004<\/p>\n
(State of West Begal & Ors. Vs.Urmila Roy & three Ors.) and<\/p>\n
FMA 790 of 2006 (Smt. Krishna Majumdar & Ors. Vs. State of<\/p>\n
West Bengal & Ors.) and was argued at length over several
\n                                 6<\/span><\/p>\n
days.     The Division Bench by its judgment dated 2nd July<\/p>\n
2007, accepted the argument of the Advocate General<\/p>\n
appearing for the State appellant based on several judgments<\/p>\n
of this Court that a challenge to an acquisition should not be<\/p>\n
permitted after the award had been rendered, and that in any<\/p>\n
case, the challenge even if permissible, had been made<\/p>\n
belatedly. The Division Bench then went on to the facts of the<\/p>\n
case and observed that the conclusion of the learned Single<\/p>\n
Judge that the whole process of acquisition was malafide, was<\/p>\n
based on a misconception, more particularly as several<\/p>\n
documents which were relevant had been ignored, that in the<\/p>\n
face of these documents, the finding of the learned Single<\/p>\n
Judge that the housing scheme had not been prepared with<\/p>\n
the approval of the State Government was erroneous, and that<\/p>\n
the     evidence   revealed   that   a   substantial   part   of   the<\/p>\n
compensation for the acquired land had been paid by the<\/p>\n
Government or its agencies.          The Division Bench further<\/p>\n
observed that from a perusal of the record that the acquisition<\/p>\n
proceedings themselves were transparent in nature and<\/p>\n
merely because the name of Bengal Peerless as the ultimate
\n                                 7<\/span><\/p>\n
beneficiary had come up for the first time in the Notification<\/p>\n
under Section 9 of the Act could not lead to the conclusion<\/p>\n
that the acquisition proceedings were a colourable exercise of<\/p>\n
power. The Court then examined the purpose behind the<\/p>\n
enactment of the 1972 Act and opined that the Housing Board<\/p>\n
had been established under governmental control with a view<\/p>\n
to alleviating the shortage of housing and in particular<\/p>\n
referred to Sections 17 to 21 to highlight that all its members<\/p>\n
were appointed by the State Government and the Chairman<\/p>\n
was, in fact, the Minister of In-charge of the Housing in the<\/p>\n
State Government. The Division Bench also held that Section<\/p>\n
27A which had been inserted in the parent act by an<\/p>\n
amendment      of   1993   was       for   the   specific   purpose   of<\/p>\n
authorizing the Housing Board to entrust the execution of a<\/p>\n
housing scheme to a joint sector company if it was felt that it<\/p>\n
was unable to perform its duties on account of financial<\/p>\n
limitations.    The Division Bench then observed that a<\/p>\n
Memorandum of Understanding had been signed on 2nd May<\/p>\n
1994 providing that the Housing Board and the Bengal<\/p>\n
Peerless would have an equal share capital of 49.5% each and
\n                             8<\/span><\/p>\n
the balance   1% would be held by the public and that the<\/p>\n
company would be run by a nine member independent Board<\/p>\n
of Directors of whom five, including the Chairman, were to be<\/p>\n
nominated by the State Government with the result that the<\/p>\n
State Government was, in effect, in complete control of the<\/p>\n
management of Bengal Peerless. It was finally concluded that<\/p>\n
in view of this feature and the fact that as per record a<\/p>\n
substantial part of the compensation had been paid out of<\/p>\n
public funds by the Housing Board, a State Government<\/p>\n
undertaking, it was not open to the land owners to argue that<\/p>\n
the land had been acquired to benefit a purely private<\/p>\n
company. The Division Bench also relied upon the judgment<\/p>\n
in State of Gujarat & Anr vs. Sankalchand Khodidas Patel<\/p>\n
(D)<\/a> (1977) 4 SCC 590 and Pratibha Nema & Ors. Vs. State<\/p>\n
of M.P. & Ors. (2003) 10 SCC 626 to draw a distinction<\/p>\n
between acquisition for a public purpose and acquisition for a<\/p>\n
company and observed that as some part of the compensation<\/p>\n
had been paid by the Housing Board, the fact that the<\/p>\n
procedure for acquisition for a public purpose had been<\/p>\n
adopted was justified on the facts of the case and relying
\n                                9<\/span><\/p>\n
further on Manubhai Jehtalal Patel vs. State of Gujarat<\/a><\/p>\n
(1983) 4 SCC 553 further held that even a contribution of<\/p>\n
Re.1\/-     from   the   State   Revenues   could,    in   certain<\/p>\n
circumstances, be held adequate to hold that the acquisition<\/p>\n
was for a public purpose. The Division Bench finally observed<\/p>\n
thus:\n<\/p>\n
                   “From the above it becomes crystal
\n        clear that the contribution to be made by the
\n        State need not be substantial and even a token
\n        contribution of Rs.100 would satisfy the
\n        requirement that the compensation has been
\n        paid out of public funds.”\n<\/p><\/blockquote>\n
6.      The Division Bench thereafter examined the issue as to<\/p>\n
whether     the   housing   scheme   had   been     prepared   in<\/p>\n
accordance with the provisions of the 1972 Act and once again<\/p>\n
differed from the findings of the learned Single Judge that the<\/p>\n
provisions had been ignored, as a perusal of the record<\/p>\n
revealed that the scheme had been framed by the State<\/p>\n
Government pursuant to a meeting held on 17th May 2000 in<\/p>\n
the Office of the Secretary Housing in the presence of the<\/p>\n
Commissioner and the Land Acquisition Officer of the Housing<\/p>\n
Board and the agenda circulated for the meeting established
\n                              10<\/span><\/p>\n
that it had been called to discuss the suitability of the scheme<\/p>\n
which had been designed to benefit the weaker sections of<\/p>\n
society and others with modest means, as it envisaged the<\/p>\n
construction of about 1800 dwelling units of three categories,<\/p>\n
namely the low, the middle and the higher income groups and<\/p>\n
that at least 50% of the aforesaid units were to be reserved for<\/p>\n
the first two groups with the price for the former category<\/p>\n
being substantially subsidized and the flats for the middle<\/p>\n
income group to be provided on “no profit no loss basis” and,<\/p>\n
significantly, it was specified that the price once determined<\/p>\n
by the Housing Board before the start of the project would<\/p>\n
remain firm and that no escalation on any account was to be<\/p>\n
made for any of the dwelling units of any category.         The<\/p>\n
aforesaid information led the Division Bench to conclude that<\/p>\n
the non-escalation Clause in particular, indicated that the<\/p>\n
scheme was not motivated by profiteering alone but was in<\/p>\n
fact for the benefit of poorer sections, and that if any further<\/p>\n
evidence was required to prove the bonafides of Bengal<\/p>\n
Peerless, the scheme also provided that distribution of plots<\/p>\n
was subject to the reservation of plots as per the policy of the
\n                             11<\/span><\/p>\n
Housing Board and allotments were to be made by a lottery<\/p>\n
system and that scheme was to be completed within 5 years<\/p>\n
from the date of the commencement of the work. Finally, the<\/p>\n
Division Bench observed as under:\n<\/p>\n
              “In our opinion, these observations of
\n         the Supreme Court are fully applicable to
\n         the facts and circumstances of the present
\n         case. The facts narrated above make it
\n         abundantly clear that Housing Scheme has
\n         been prepared by the Government, after
\n         due consideration and it could not be said
\n         to have been initiated at the instance of the
\n         Bengal Peerless. Therefore, the learned
\n         Single Judge has erroneously held that the
\n         acquisition proceedings were null and void.”\n<\/p><\/blockquote>\n
7.   The Division Bench also repelled the argument raised on<\/p>\n
behalf of the land owners that as they too were in the process<\/p>\n
of setting up a global village in the land the acquisition was<\/p>\n
untenable by observing that the letter dated 8th May 2001<\/p>\n
written by Urmila Roy respondent on which primary reliance<\/p>\n
had been made by the land owners          with respect to the<\/p>\n
aforesaid plea was not acceptable at this belated stage as the<\/p>\n
land owners had not raised any objection to the acquisition of<\/p>\n
the land by the State Government, and further that no such
\n                              12<\/span><\/p>\n
plea had not been raised in the writ petition.   The Court then<\/p>\n
observed that Writ Petition No.10002 (W) of 2002 filed by some<\/p>\n
other land owners seeking to challenge the same acquisition<\/p>\n
had been dismissed by Justice Chattopadhyay on 16th<\/p>\n
September 2003 and the issues raised in the present appeal<\/p>\n
had also been raised before the said Judge and had been<\/p>\n
repelled and it had been specifically observed that the land<\/p>\n
had, indeed, been acquired for a public purpose and not for a<\/p>\n
private company, as alleged. The Division Bench, accordingly,<\/p>\n
allowed the appeal leading to the present matters before this<\/p>\n
Court.\n<\/p>\n
8.   The learned counsel for the appellants has raised several<\/p>\n
issues before us. It has been submitted that the Bengal<\/p>\n
Peerless was not a Corporation within the meaning of Section<\/p>\n
3 (cc) of the Act, inasmuch as 51% of the share capital in the<\/p>\n
said company was not held by the State Government or any<\/p>\n
Central Government or State Government Undertaking as only<\/p>\n
49.5% of the shareholding was held by the Housing Board. It<\/p>\n
has been submitted that Bengal Peerless was also not a<\/p>\n
company within the meaning of section 617 of the Companies
\n                             13<\/span><\/p>\n
Act, 1956 and was therefore a company within the meaning of<\/p>\n
Section 3(e) of the Land Acquisition Act, and as such Part VII<\/p>\n
of the Act was applicable and not Part II thereof. It has also<\/p>\n
been submitted that the housing scheme Annexure P3 was<\/p>\n
not a housing scheme, as envisaged under the 1972 Act but<\/p>\n
was merely a proposal that too an incomplete one. Reliance<\/p>\n
for this submission has been placed on Sections 17,18,19,23<\/p>\n
27 and 27(A) of the 1972 Act. As a corollary, it has been<\/p>\n
argued that the finding that Bengal Peerless had been<\/p>\n
entrusted with the execution of the housing scheme was<\/p>\n
incorrect, as no terms and conditions of such entrustment<\/p>\n
had been agreed upon as was a pre-requisite for the execution<\/p>\n
of a housing project by a Joint Sector Company under section<\/p>\n
27-A of the 1972 Act. It has also been urged that the entire<\/p>\n
amount of the acquisition money deposited prior to the<\/p>\n
publication of the declaration under Section 6 of the Land<\/p>\n
Acquisition Act had been paid by Bengal Peerless and no part<\/p>\n
thereof had been paid by the Government of West Bengal or<\/p>\n
the Housing Board, and further the finding of the Single<\/p>\n
Bench as also of the Division Bench of the High Court to the
\n                                 14<\/span><\/p>\n
effect that the acquisition proceedings had been set in motion<\/p>\n
after the scheme had been duly prepared was incorrect. It has<\/p>\n
accordingly been argued that the observation of the Division<\/p>\n
Bench in the State of Tamil Nadu vs.L.Krishnan (1996) 1<\/p>\n
SCC 250 were not applicable to the facts of the case and that<\/p>\n
in   any   event   the   Tamil   Nadu   Act   which   was   under<\/p>\n
consideration in that matter did not contain a provision<\/p>\n
analogous to Section 27A of the 1972 Act and as a necessary<\/p>\n
consequence, even assuming for a moment that a housing<\/p>\n
scheme was in fact in existence when the Notification under<\/p>\n
Section 4 of the Land Acquisition Act has been issued, the<\/p>\n
said scheme had not been formalized in terms of Section 27-A<\/p>\n
of the 1972 Act.    It has been submitted that from the facts<\/p>\n
writ large that the purpose of the acquisition and the<\/p>\n
entrustment to the Bengal Peerless of the development of the<\/p>\n
project was with the intention of giving huge financial benefits<\/p>\n
to the Bengal Peerless which was not a public purpose and<\/p>\n
was in any case unacceptable in terms of the purpose of a<\/p>\n
housing scheme envisaged under the 1972 Act.
\n                             15<\/span><\/p>\n
9.   The arguments of the learned counsel for the appellants<\/p>\n
have been controverted by the respondent State of West<\/p>\n
Bengal. It has been pointed out that the housing scheme had<\/p>\n
been designed in terms of the 1972 Act and all the relevant<\/p>\n
provisions had been complied with and that in any case by<\/p>\n
virtue of sub-section (2) of Section 17 thereof it was open to<\/p>\n
the State Government to entrust the framing and execution of<\/p>\n
a Housing scheme to the Housing Board on such terms and<\/p>\n
conditions as it think fit, and that the scope of a similar<\/p>\n
provision, Section 35 of the Tamil Nadu State Housing Board<\/p>\n
Act 1961 had been examined by this Court in L.Krishnan’s<\/p>\n
case (supra). It has also been argued that acquisition of the<\/p>\n
land for the purpose of the execution of the housing scheme<\/p>\n
was a public purpose with little or no element of profiteering<\/p>\n
as the bare reading of the scheme would show, and that, in<\/p>\n
any case, the middle and lower income groups were to have<\/p>\n
subsidized housing on “no profit no loss” basis and to ensure<\/p>\n
that the conditions of the scheme were scrupulously observed<\/p>\n
the State Government had retained complete control over the<\/p>\n
activities of Bengal Peerless. It has also been submitted that
\n                              16<\/span><\/p>\n
as the appellants land owners had not filed objections under<\/p>\n
Section 5-A of the Land Acquisition Act, they were precluded<\/p>\n
from challenging the acquisition, more particularly after the<\/p>\n
award had been rendered.\n<\/p>\n
10.   We have heard the learned counsel for the parties and<\/p>\n
gone through the record very carefully.     We find that three<\/p>\n
basic issues arise for consideration in this matter. They are, i)<\/p>\n
as to whether Part II or Part VII of the Act is applicable to the<\/p>\n
present acquisition proceedings, ii) whether the Housing<\/p>\n
Scheme was one that satisfied the requirement of Section 27A<\/p>\n
of the 1972 Act and, iii) whether the acquisition and the<\/p>\n
Scheme were a colourable exercise of power so as to give<\/p>\n
undue benefit to Bengal Peerless. We now take up the three<\/p>\n
issues cumulatively.\n<\/p>\n
11.   It has been submitted at the very outset that Bengal<\/p>\n
Peerless was not a Government Company, as understood by<\/p>\n
Section 3(cc) of the Act as the Government did not hold 51% of<\/p>\n
the paid-up share of the capital. We find, however, that<\/p>\n
Section 3(cc) is to be read along with Section 6 more
\n                             17<\/span><\/p>\n
particularly Explanation 2 appended therewith. The aforesaid<\/p>\n
provisions are reproduced hereunder:<\/p>\n
               “3(cc).the  expression    “corporation
\n        owned or controlled by the State” means
\n        anybody corporation established by or
\n        under a Central, Provincial or State Act,
\n        and includes a Government company as
\n        defined       in  Section    617     of    the
\n        CompaniesAct,1956 (1 of 1956), a society
\n        registered under the Societies Registration
\n        Act,1860 (21 of 1860), or under any
\n        corresponding law for the time being in
\n        force in a State, being a society established
\n        or administered by Government and a co-
\n        operative society within the meaning of any
\n        law relating to co-operative societies for the
\n        time being in force in any State, being a co-
\n        operative society in which not less than
\n        fifty-one per centum of the paid-up share
\n        capital is held by the Central Government,
\n        or     by     any  State   Government       or
\n        Governments, or partly by the Central
\n        Government and partly by one or more
\n        State Governments.”\n<\/p><\/blockquote>\n
        Section 6 –       Declaration that land is
\n        required for a public purpose.- (1) Subject
\n        to the provisions of Part VII of this Act,
\n        when the Appropriate Government is
\n        satisfied after considering the report, if any,
\n        made under section 5 A, sub-section (2),
\n        that any particular land is needed for a
\n        public purpose, or for a company, a
\n        declaration shall be made to that effect
\n        under the signature of a Secretary to such
\n        Government or of some officer duly
\n        authorized to certify its orders and different
\n                          18<\/span><\/p>\n
       declarations may be made from time to time
\n       in respect of different parcels of any land
\n       covered by the same notification under
\n       section 4, sub-section (1), irrespective of
\n       whether one report or different reports has
\n       or have been made (wherever required)
\n       under section 5-A, sub-section (2):\n<\/p><\/blockquote>\n
             [Provided that no declaration in
\n       respect of any particular land covered by a
\n       notification under section 4, sub-section
\n       (1),-\n<\/p><\/blockquote>\n
(i)    published after the commencement of the
\n       Land     Acquisition     (Amendment     and
\n       Validation) Ordinance, 1967 but before the
\n       commencement of the Land Acquisition
\n       (Amendment) Act,1984 shall be made after
\n       the expiry of three years from the date of
\n       the publication of the notification; or<\/p>\n
(ii)   published after the commencement of the
\n       Land Acquisition (Amendment) Act, 1984
\n       shall be made after the expiry of one year
\n       from the date of the publication of the
\n       notification :\n<\/p>\n
       Provided further that no such declaration
\n       shall be made unless the compensation to
\n       be awarded for such property is to be paid
\n       by a company, or wholly or partly out of
\n       public revenues or some fund controlled or
\n       managed by a local authority.\n<\/p>\n
                     19<\/span><\/p>\n
      [Explanation 1. – In computing any of
\nthe periods referred to in the first proviso,
\nthe period during which any action or
\nproceeding to be taken in pursuance of the
\nnotification issued under Section 4, sub-
\nsection (1),is stayed by an order of a Court
\nshall be excluded.\n<\/p>\n
      Explanation      2.-    Where       the
\ncompensation to be awarded for such
\nproperty is to be paid out of the funds of a
\ncorporation owned or controlled by the
\nState, such compensation shall be deemed
\nto be compensation paid out of public
\nrevenues].\n<\/p>\n<\/p>\n
      (2)   Every   declaration     shall   be
\npublished in the Official Gazette, [and in
\ntwo daily newspapers circulating in the
\nlocality in which the land is situate of which
\nat least one shall be in the regional
\nlanguage, and the Collector shall cause
\npublic notice of the substance of such
\ndeclaration to be given at convenient places
\nin the said locality (the last of the date of
\nsuch publication and the giving of such
\npublic notice, being hereinafter referred to
\nas the date of publication of the
\ndeclaration), and such declaration shall
\nstate], the district or other territorial
\ndivision in which the land is situate, the
\npurpose for which it is needed, its
\napproximate area, and where a plan shall
\nhave been made of the land, the place
\nwhere such plan may be inspected.\n<\/p>\n
                                 20<\/span><\/p>\n
                (3) The said declaration shall be
\n           conclusive evidence that the land is needed
\n           for a public purpose or for a company, as
\n           the case may be; and, after making such
\n           declaration the Appropriate Government
\n           may acquire the land in a manner
\n           hereinafter appearing.\n<\/p>\n<\/p>\n
12.         A perusal of the Second proviso and Explanation 2<\/p>\n
in particular reveals that if the compensation awarded for the<\/p>\n
property    is   paid   substantially   out    of   the   funds    of   a<\/p>\n
Corporation      owned    or   controlled     by    the   State,   such<\/p>\n
compensation will be deemed to be paid out of public funds<\/p>\n
and as such would satisfy the test of acquisition for a public<\/p>\n
purpose.\n<\/p>\n
13.         We see from the record that as per letter issued by<\/p>\n
the Land Acquisition Collector on 13th November 2001 to the<\/p>\n
Housing Ministry of the State Government, a request had been<\/p>\n
made that a sum of Rs.3.00 Crores which represented about<\/p>\n
50% of the compensation of the acquired land be deposited.<\/p>\n
This memo had been forwarded by the State Government to<\/p>\n
the Housing Board and on 23rd November 2001 a sum of
\n                              21<\/span><\/p>\n
Rs.1.70 crores towards compensation had been sent by<\/p>\n
Bengal Peerless to the Land Acquisition Collector through the<\/p>\n
Housing Board. It appears that on 30th October 2003 the State<\/p>\n
Government had requested the Housing Board to make<\/p>\n
arrangements for the balance payment of compensation of<\/p>\n
about Rs.82,04,138 and by a memorandum of 31st October<\/p>\n
2003 the Government of West Bengal had directed the<\/p>\n
Housing Board to pay the additional balance compensation<\/p>\n
which too was defrayed by an account payee cheque dated<\/p>\n
03rd November 2003 drawn on the Bank of Maharashtra. The<\/p>\n
account statement of the Bank of Maharashtra was produced<\/p>\n
before us for perusal and this statement supports the<\/p>\n
argument that the aforesaid amount had, indeed, been paid<\/p>\n
from the funds of the Housing Board which is completely<\/p>\n
owned and controlled by the State Government.           In their<\/p>\n
written submissions the appellants have doubted the accuracy<\/p>\n
of this statement, by asserting that they had not been able to<\/p>\n
verify its contents as it had been produced for the first time in<\/p>\n
this Court. We find that even if this objection is accepted and<\/p>\n
the statement ruled out of consideration, the other evidence
\n                             22<\/span><\/p>\n
on record does indicate that a substantial part of the<\/p>\n
compensation had been paid from Government funds.       In<\/p>\n
Pratibha Nema case (supra), that is what this Court had to<\/p>\n
say:\n<\/p>\n<\/p>\n
            We may now advert to Section 6. It
\n         provides for a declaration to be made by
\n         the Government or its duly authorized
\n         officer that a particular land is needed for
\n         a public purpose or for a company when
\n         the Government is satisfied after
\n         considering the report, if any, made
\n         under Section 5-A(2). It is explicitly made
\n         clear that such declaration shall be
\n         subject to the provisions of Part VII of the
\n         Act which bears the chapter heading
\n         “Acquisition of Land for Companies”.
\n         Thus, Section 6 reiterates the apparent
\n         distinction between acquisition for a
\n         public purpose and acquisition for a
\n         company. There is an important and
\n         crucial proviso to Section 6 which has a
\n         bearing on the question whether the
\n         acquisition is for a public purpose or for
\n         a company. The second proviso lays
\n         down that”no such declaration shall be
\n         made unless the compensation to be
\n         awarded for such property is to be paid
\n         by a company, or wholly or partly out of
\n         public revenues or some fund controlled
\n         or managed by a local authority”.\n<\/p><\/blockquote>\n
                      23<\/span><\/p>\n
Explanation 2 then makes it clear that
\nwhere the compensation to be awarded is to
\nbe paid out of the funds of a corporation
\nowned or controlled by the State, such
\ncompensation shall be deemed to be
\ncompensation paid out of public revenues.\n<\/p>\n
Thus,     a   provision   for payment       of
\ncompensation, wholly or partly, out of
\npublic revenues or some fund controlled or
\nmanaged by a local authority is sine qua
\nnon for making a declaration to the effect
\nthat a particular land is needed for a public
\npurpose. Even if a public purpose is behind
\nthe acquisition for a company, it shall not
\nbe deemed to be an acquisition for a public
\npurpose unless at least part of the
\ncompensation is payable out of public
\nrevenues which includes the fund of a local
\nauthority or the funds of a corporation
\nowned or controlled by the State. However,
\nit was laid down in Somawanti case that the
\nnotification under Section 6(1) need not
\nexplicitly set out the fact that the
\nGovernment had decided to pay a part of
\nthe expenses of the acquisition or even to
\nstate that the Government is prepared to
\nmake a part of contribution to the cost of
\nacquisition. It was further clarified that the
\nabsence of a provision in the budget in
\nrespect of the cost of acquisition, whole or
\npart, cannot affect the validity of the
\ndeclaration. The majority Judges of the
\nConstitution Bench also clarified that a
\ncontribution to be made by the State need
\nnot be substantial and even the token
\ncontribution of Rs 100 which was made
\nin that case satisfied the requirements of
\nthe proviso to Section 6(1). The contribution
\nof a small fraction of the total probable cost
\n                               24<\/span><\/p>\n
        of the acquisition does not necessarily
\n        vitiate the declaration on the ground of
\n        colourable exercise of power, according to
\n        the ruling in the said case. Following
\n        Somawanti, the same approach was adopted
\n        in Jage Ram v. State of Haryana. The<\/a>
\n        question, whether the contribution of a
\n        nominal amount from the public exchequer
\n        would meet the requirements of the proviso
\n        to Section 6, had again come up for
\n        consideration in Manubhai Jehtalal Patel v.
\n        State of Gujarat. D.A. Desai, J.<\/a> after
\n        referring to Somawanti, speaking for the
\n        three-Judge Bench observed thus: (SCC p.\n<\/p>\n
              555, para 4)
\n           “It is not correct to determine the validity
\n        of acquisition keeping in view the amount of
\n        contribution but the motivation for making
\n        the contribution would help in determining
\n        the bona fides of acquisition. Further in
\n        Malimabu case contribution of Re 1 from the
\n        State revenue was held adequate to hold
\n        that acquisition was for public purpose with
\n        State fund. Therefore, the contribution of Re
\n        1 from public exchequer cannot be dubbed
\n        as illusory so as to invalidate the
\n        acquisition.”\n<\/p>\n<\/p>\n
14.   In Inderjeet Parekh Vs State of Gujarat         in which a<\/p>\n
somewhat restricted meaning has been given to the extremely<\/p>\n
broad parameters laid down in Pratibha Nema’s case (Supra),<\/p>\n
but it has nonetheless been observed that if a reasonable
\n                                25<\/span><\/p>\n
amount of compensation had been drawn out Government<\/p>\n
funds, it would satisfy the requirement of a public purpose as<\/p>\n
per the Act. In the present case, as already mentioned above,<\/p>\n
we find that a substantial part of the compensation has,<\/p>\n
indeed, been paid by the State Government or by the Housing<\/p>\n
Board which clearly satisfies the test of public purpose.    In<\/p>\n
this background, we endorse the finding of the Division Bench<\/p>\n
that the procedure envisaged in Part II and not in Part VII of<\/p>\n
the Act would be applicable. This is precisely what has been<\/p>\n
done.\n<\/p>\n
15.   The   learned   Counsel   for the   Appellants   has also<\/p>\n
contended that as the housing scheme had not been prepared<\/p>\n
in terms of the 1972 Act it had no valid sanction. It has been<\/p>\n
highlighted that the entire scheme had been designed to help<\/p>\n
Bengal Peerless to make undue profits and the very purpose of<\/p>\n
1972 Act had, thus, been frustrated.\n<\/p>\n
16.     The learned counsel for the respondent has on the<\/p>\n
contrary referred us to Sections 17, 18 and 27A of the 1972<\/p>\n
Act to submit that the said Act specifically provided for the<\/p>\n
transfer of the acquired land to a Joint Sector Company for
\n                             26<\/span><\/p>\n
the purpose of the execution of the Housing Scheme with the<\/p>\n
previous approval of the State Government and that the<\/p>\n
scheme had indeed been framed under Sections 17 and 18<\/p>\n
and thereafter entrusted for execution to the Bengal Peerless.<\/p>\n
It has been submitted that though Bengal Peerless had been<\/p>\n
entrusted with the execution of the scheme the overall control<\/p>\n
remained with the Housing Board which was, in fact, an<\/p>\n
extension of the State Government itself and the State<\/p>\n
Government a fortiori retained overall control in the execution<\/p>\n
of the scheme. We find merit in this submission. The record<\/p>\n
indicates that as a consequence of a Memorandum of<\/p>\n
Understanding dated 13th September 1993 a Joint Sector<\/p>\n
Company for the execution of the housing scheme had been<\/p>\n
created on 20th May 1994 and it was provided that 49.5% of<\/p>\n
the shares capital would be held by each of the two i.e. the<\/p>\n
Housing Board and Bengal Peerless and the balance 1% would<\/p>\n
be held by the public and the company would be run<\/p>\n
independently by nine Directors, of whom five including the<\/p>\n
Chairman were to be nominated by the State Government. It<\/p>\n
is also relevant that the scheme had, in fact, been prepared by
\n                              27<\/span><\/p>\n
the State Government after due deliberation and had been<\/p>\n
initiated as per the provisions of the 1972 Act by virtue of a<\/p>\n
meeting held on 17th May 2000 in the Office of the Secretary,<\/p>\n
Housing Department, the Commissioner of the Housing<\/p>\n
Board, the Land Acquisition Collector and several other senior<\/p>\n
officials and the proposal had been mooted for the acquisition<\/p>\n
of the land for the purpose of a scheme for weaker sections of<\/p>\n
society and others with modest incomes. The scheme also<\/p>\n
provided for the construction of 1800 dwelling units of various<\/p>\n
categories with at least 50% to be earmarked for the lower and<\/p>\n
middle income groups with the price subsidized for the former<\/p>\n
and all flats for the middle income group to be provided on “no<\/p>\n
profit no loss” basis, and for facilities for schools, roads etc.<\/p>\n
for the benefit of those who were ultimately to reside in the<\/p>\n
dwelling units.   Significantly also, the scheme provided that<\/p>\n
there would be no escalation on account of any reason<\/p>\n
whatsoever for the price charged for the dwelling units and<\/p>\n
that the allotment of the dwelling units would be on the basis<\/p>\n
of a lottery. Section 18 of the 1972 Act which deals with the
\n                             28<\/span><\/p>\n
matters to be provided for by housing schemes is reproduced<\/p>\n
below:\n<\/p>\n
              “Sec.18. Matters to be provided for
\n         by housing schemes. – Notwithstanding
\n         anything contained in any other law for the
\n         time being in force, a housing scheme may
\n         provide for all or any of the following
\n         matters, namely :-\n<\/p><\/blockquote>\n
              (a) the acquisition by purchase,
\n         exchange or otherwise of any property
\n         necessary for the scheme;\n<\/p><\/blockquote>\n
              (b)     the       construction and
\n         reconstruction of buildings;\n<\/p><\/blockquote>\n
              (c) the sale, letting out or exchange of
\n         any property included in the scheme;\n<\/p><\/blockquote>\n
               (d) roads, drainage, water-supply,
\n         lighting,
\n         schools,hospitals,dispensaries,marketplace
\n         s,parks,playgrounds and open spaces
\n         within a housing scheme;\n<\/p><\/blockquote>\n
               (e) the reclamation or reservation of
\n         lands     for   markets,   gardens,schools,
\n         dispensaries, hospitals and other amenities
\n         in a housing scheme;\n<\/p><\/blockquote>\n
                             29<\/span><\/p>\n
              (f) the letting out,management and
\n         use, of the Board premises;\n<\/p><\/blockquote>\n
              (g) accommodation for any class of
\n         inhabitants;\n<\/p><\/blockquote>\n
             (h) the advancing of money for the
\n         purpose of the scheme;\n<\/p><\/blockquote>\n
              (i) the collection of such information
\n         and statistics as may be necessary for
\n         successful implementation of the scheme;\n<\/p><\/blockquote>\n
               (ia) development of any urban or rural
\n         area for successful implementation of
\n         housing schemes and for purposes ancillary
\n         or incidental thereto;\n<\/p><\/blockquote>\n
              (j) any other matter for which, in the
\n         opinion of the Board or the State
\n         Government, it is expedient to make
\n         provision with a view to providing housing
\n         accommodation and to improving or
\n         developing of any area included in a
\n         housing scheme.”\n<\/p><\/blockquote>\n
17.   We find that the scheme as laid fully satisfies the tests<\/p>\n
laid down in this provision. Sections 17, 27A and 28 of the<\/p>\n
1972 Act read as under:\n<\/p>\n
                    30<\/span><\/p>\n
    ” 17. Powers and duties of Board to
\nundertake housing schemes.-\n<\/p>\n
(i) Subject to the provisions of this Act the
\nBoard may, from time to time, incur
\nexpenditure and undertake works for the
\nframing and execution of such housing
\nschemes as it may consider necessary and
\nsuch housing schemes may include housing
\nschemes in relation to lands and buildings
\nvested in or in the possession of the State
\nGovernment.\n<\/p>\n
(2) The State Government may, on such
\nterms and conditions as it may think fit to
\nimpose, entrust to the Board the framing
\nand execution of any housing scheme
\n[,whether provided for by this Act or not,]
\nand the Board shall thereupon undertake
\nthe framing and execution of such scheme.<\/p>\n
(3) The Board may, on such terms and
\nconditions as may be agreed upon and with
\nthe previous approval of the State
\nGovernment, take over for execution any
\nhousing scheme, on behalf of a local
\nauthority or co-operative society, or on
\nbehalf of an employer, for building houses
\nmainly for the residence of the employees of
\nsuch local authority, co-operative society or
\nemployer, as the case may be [or for the
\nresidence of the members of such co-\n<\/p>\n
operative society].\n<\/p>\n
                     31<\/span><\/p>\n
27A. Power to entrust existing, or new,
\njoint sector company with housing
\nscheme.-        Notwithstanding      anything
\ncontained in this Act, the Board may, if it
\nconsiders it necessary so to do in the public
\ninterest and is satisfied that an existing, or
\nnew, joint sector company is willing to
\ncomply, or has complied, with such terms
\nand conditions as the State Government
\nmay think fit to impose,entrust, with the
\nprevious      approval     of    the     State
\nGovernment,any existing, or new, joint
\nsector company with any housing scheme
\nfor execution, and different existing, or new,
\njoint sector companies may be so entrusted
\nwith    different   housing    schemes      for
\nexecution.\n<\/p>\n
28. Power to acquire.- (1) Where any land
\nis needed for the purpose of a housing
\nscheme or for performing any other duties
\nor functions of the Board, the Board may
\nenter into an agreement with any person for
\nthe acquisition by purchase, lease or
\nexchange, of his rights and interests in
\nsuch land either wholly or in part, on
\npayment of an amount proportionate to the
\nloss or deprivation caused to the enjoyment
\nof the land.\n<\/p>\n
(2) The Board may also take steps for the
\ncompulsory acquisition of any land or any
\ninterest therein required for the execution of
\na housing scheme or for performing any
\nother duties or functions of the Board and
\nsuch acquisition of any land or any interest
\ntherein shall be deemed to be acquisition
\nfor a public purpose within the meaning of
\nthe Land Acquisition Act. ”\n<\/p>\n
                             32<\/span><\/p>\n
18.   We observe that Section 27-A specifically authorizes the<\/p>\n
Housing Board in public interest to entrust a housing scheme<\/p>\n
to a Joint Sector Company with the previous approval of the<\/p>\n
State Government.    We find that there is no warrant for the<\/p>\n
proposition that unless a budgetary provision is made by the<\/p>\n
Housing Board or that a final scheme is prepared in<\/p>\n
accordance with Section 23 of the 1972 Act, no land can be<\/p>\n
acquired for the purpose of execution of a housing scheme. It<\/p>\n
is significant that Section 17 of the 1972 Act itself gives the<\/p>\n
power to the Housing Board to make a scheme and that<\/p>\n
Section 27A further authorizes the Board in public interest to<\/p>\n
entrust a housing scheme to a Joint Sector Company for<\/p>\n
execution and for that purpose Section 28(2) of the Act further<\/p>\n
authorizes the Housing Board to take steps for compulsory<\/p>\n
acquisition of any land required for the purpose of a housing<\/p>\n
scheme.    While dealing with Section 35 of the Tamil Nadu<\/p>\n
Housing Board Act, 1961 which is akin to Section 17 of the<\/p>\n
1972 Act, this is what this Court had to say in L. Krishanan<\/p>\n
Case (supra):\n<\/p>\n
                    33<\/span><\/p>\n
      “……The Housing Board is under an
\nobligation to carry out certain other
\nschemes also as are provided in these
\nsections. Sub-section (2) of Section 35
\nstates that the Government may on such
\nterms and conditions as they may think fit
\nto impose, transfer to the Board the
\nexecution of any housing or improvement
\nscheme not provided for by the Act. On
\nsuch transfer, the Board is under obligation
\nto undertake the execution of such scheme
\nas if such scheme has been provided for by
\nthe Housing Board Act.”\n<\/p>\n<\/p>\n
      Para 15. These provisions make it
\nabundantly clear that the duty of the
\nHousing Board is not merely the execution
\nof the housing or improvement scheme
\nprepared and published by it under the Act
\nbut extends to executing other schemes as
\nwell, as are made over to it or agreed to be
\nundertaken by it. Now, when Section 35(2)
\nspeaks of transfer to the Board the
\nexecution of any housing or improvement
\nscheme not provided for by this Act, it
\ncertainly cannot mean a scheme prepared
\nin accordance with the provisions of the
\nHousing Board Act. Moreover, while
\ntransferring the scheme to the Housing or
\nimprovement       scheme     prepared     in
\naccordance with the Housing Board Act.
\nHere again, the taking over the scheme by
\nthe Housing Board is subject to such terms
\nand conditions as may be agreed upon by
\nboth. Section 36 indeed discloses that what
\nis entrusted to the Housing Board is the job
\nof clearance or improvement of any slum
\n                    34<\/span><\/p>\n
area. The Government while directing the
\nBoard to undertake the clearance or
\nimprovement of a particular area can also
\ndirect the Board to frame and execute “such
\nhousing or improvement scheme under this
\nAct as the Government may specify” and the
\nBoard is obliged to execute such scheme as
\nif such scheme is prepared by the Act.”<\/p>\n
      Para 16. In such circumstances, it
\nwould not be right to contend that unless a
\nfinal and effective scheme prepared in
\naccordance with the provisions of Chapter
\nVII of the Housing Board Act is in existence,
\nthe Government cannot issue a notification
\nunder section 4 of the Land Acquisition Act
\nfor acquiring the land required for execution
\nof the schemes by the Housing Board. To
\nrepeat, the Housing Board is obliged to
\nexecute     not   only   the    housing    or
\nimprovement schemes prepared under the
\nsaid Chapter but also certain other schemes
\nreferred to in Sections 35 and 36. For
\nexample the Government may conceive a
\nparticular scheme and ask the Housing
\nBoard to execute on such terms and
\nconditions as the Government may specify.
\nIn such a situation, there is no question of
\npreparing a housing or improvement
\nscheme by the Housing Board in
\naccordance with the provisions of Housing
\nBoard over again. So far as the scheme
\nframed by the Government is concerned,
\nthere is no enactment governing it. It can,
\ntherefore, be a scheme as ordinarily
\nunderstood.     Similar would be the case
\nwhere the scheme undertaken by a local
\n                              35<\/span><\/p>\n
         authority is made over the Housing Board
\n         by mutual agreement.”\n<\/p>\n<\/p>\n
19.   In West Bengal Housing Board & Ors. vs. Brijendra<\/p>\n
Prasad Gupta & Ors.<\/a> (1997) 6 SCC 207 while taking an<\/p>\n
overall view of the entire matter and also dealing with the<\/p>\n
submission that some profit motive could be involved in<\/p>\n
favour of a Joint Sector Company executing a housing<\/p>\n
scheme, this is what this Court had to say:<\/p>\n
            “Para 19. In this background it is difficult
\n         for us to accept the submissions of the Writ
\n         Petitioners that the purpose for which the
\n         requisition had been made was not a public
\n         purpose within the meaning of the Act or
\n         that the circumstances of the cases did not
\n         justify the invocation of the provisions of
\n         the Act or that the exercise of powers under
\n         that Act was colourable exercise of power.<\/p><\/blockquote>\n
            Para 25. It is a matter of common
\n         knowledge that there is acute shortage of
\n         housing accommodation both in rural and
\n         urban areas of the country. Since late the
\n         prices of the real estate have sky-rocketed
\n         making it beyond the reach of low income
\n         and middle income people. The State has
\n         duty to perform to give shelter to homeless
\n         people specially to people in the income
\n         group. In the present case the State was
\n         unable to meet this gigantic task. In the
\n         background of shortage of resources which
\n         the State has the legislative enacted the
\n                     36<\/span><\/p>\n
Housing Board Act and constituted the
\nHousing Board to meet this challenge of
\nproviding houses to the people falling in the
\nlow income group and to others. Again the
\nHousing Board was unable to meet the
\nchallenge.    The Housing Board Act was
\namended to bring in the concept of joint
\nventure in order to tap the resources of the
\nprivate sector. Thus a joint venture came
\ninto    being     as     disclosed  in    the
\nsupplementary affidavit of the State as to
\nhow the process of starting of joint venture
\nhad been gone into and how the Board of
\nDirectors of the joint sector company has
\nbeen constituted and how the State and
\nHousing Board exercise control over this
\njoint sector enterprise.\n<\/p>\n<\/p>\n
    26. Simply because there is an element of
\nprofit, it could not make the whole scheme
\nillegal. A private entrepreneur will certainly
\nlook to some profit but to see that the profit
\nmotive does not lead to exploitation even of
\nthe rich and that the houses are available to
\nthe poor people and to middle class people
\nat nominal or affordable prices, or even on
\nno-profit-no-loss basis, the Housing Board
\nexercises the necessary control. It is
\ncertainly a public purpose to provide
\nhouses to the community especially to poor
\npeople for whom the prices are beyond their
\nmeans and they would otherwise never be
\nable to acquire a house.\n<\/p>\n
                     37<\/span><\/p>\n
   27. What has been done in the present
\ncase is that the profit earned on sale of flats
\nof HIG have been pumped in to subsidize
\nthe prices of the houses falling in LIG and
\nin this there would certainly be an element
\nof profit both for the Housing Board as well
\nas the private company in the joint venture
\nfor selling flats of HIG. We fail to see how
\npublic purpose is not being served in the
\npresent case.\n<\/p>\n<\/p>\n
   28. The Court must shake off its myth
\nthat public purpose is served only if the
\nState or the Housing Board or the joint
\nsector company does not earn any profit.
\nThere cannot be any better authority than
\nthe State or the statutory corporation to
\nsupervise or monitor the functions of the
\njoint venture company. Courts will certainly
\nstep in if the public purpose is sought to be
\nfrustrated.\n<\/p>\n<\/p>\n
   29. In the present case Directors
\nappointed by the Housing Board\/State on
\nthe Board of Directors of the joint venture
\ncompany would certainly see that no
\nrunaway profit is earned and that sale price
\nof HIG houses is guided by market forces
\nbut there is no exploitation. Every section of
\nthe    society    needs    protection    from
\nexploitation. It is however not possible nor
\ndesirable to lay down any principle as to
\nhow this is to be done.\n<\/p>\n
                     38<\/span><\/p>\n
   33. We find in the present backdrop the
\ninability of the State Government and the
\nHousing Board to meet the challenge to
\nachieve the target of even constructing
\n50,000dwelling units in urban areas to
\ntackle the acute problem of homelessness
\nfor different categories of people particularly
\nthose falling in Lower Income Group (LIG)
\nand Middle Income Group (MIG); the State
\nLegislature amending the Housing Board
\nAct and providing for incorporation of a
\njoint sector company for executing the
\nhousing scheme on the terms and
\nconditions to be approved by the
\nGovernment; selection of the private
\nentrepreneur for incorporation of the joint
\nsector company with the Housing Board;
\nthe constitution of the Board of Directors of
\nthe joint sector company; the control of the
\nHousing Board and the State Government
\nover the joint sector company to execute the
\nscheme of the housing project; control on
\nthe fixation of prices of the flats to be
\nconstructed by the joint sector company;
\nrelevant factors taken into consideration for
\nexecution of the housing project and all
\nthese to tackle the urgent and growing need
\nof providing shelter to the LIG and MIG
\npeople when it is not possible for those
\npeople to acquire a house of their own with
\nescalating real estate prices; it cannot be
\nsaid that the public purpose is not being
\nserved or the incorporation of the joint
\nsector     company,viz.     Bengal    Peerless
\nHousing Development Co.Ltd. and the
\nexecution of the housing project “Anupama”
\nby this joint sector company, in the given
\ncircumstances, on the land in question
\nwhich is part of the bigger piece of land is
\n                              39<\/span><\/p>\n
         not in public interest. The Housing Board
\n         acts as regulatory body and the State
\n         Government oversees the housing project
\n         and has also imposed certain terms and
\n         conditions. No ulterior purpose has been
\n         alleged and it cannot be said that the power
\n         exercised by the State authorities are in any
\n         way arbitrary or irrational or there is any
\n         abuse    of    power.   Rather    the    legal
\n         compulsion of the State and the Housing
\n         Board to get the housing project executed
\n         through a joint sector company is quite
\n         understandable. We also find the impugned
\n         action is within the purview of law and is
\n         valid.”\n<\/p>\n<\/p>\n
20.   In view of what has been observed above, and in the<\/p>\n
background of the present case, it becomes crystal clear that<\/p>\n
though the execution of the housing scheme has been<\/p>\n
entrusted to a Joint Sector Company, the overall control over<\/p>\n
the project has been retained by the Government controlled<\/p>\n
Board of Directors, full    details of the scheme have been<\/p>\n
provided with large provisions for the benefit of the poorer<\/p>\n
sections of society, with the allotment of tenements either on a<\/p>\n
subsidized price or on “no profit no loss” basis for the low and<\/p>\n
middle income groups respectively, allotment by draw of lots<\/p>\n
to avoid any arbitrariness and a complete freeze on the price
\n                               40<\/span><\/p>\n
of residential accommodation with no escalation whatsoever<\/p>\n
for whatever reason and the provision of facilities for effective<\/p>\n
and comfortable living such as schools, roads, sewage etc. We<\/p>\n
are, therefore, of the opinion that the housing scheme fully<\/p>\n
satisfies the tests laid down by the Supreme Court in the two<\/p>\n
cases cited immediately above.\n<\/p>\n
21.   There is yet another aspect which needs to be dealt with.<\/p>\n
It appears from the record, and it was so pointed out during<\/p>\n
the course of arguments, that the appellants had not filed any<\/p>\n
objection to the acquisition on the plea that some assurance<\/p>\n
had been held out that they too would be allowed to<\/p>\n
participate in the housing scheme. This fact has been denied<\/p>\n
by the respondents and it has been emphasized that as per<\/p>\n
letter dated 8th March 2001 the land-owners had, in fact,<\/p>\n
waived their right to challenge the acquisition. This letter is<\/p>\n
reproduced hereunder in extenso:\n<\/p>\n<\/p>\n
      “To                             Date:8th March 2001<\/p>\n
            The Special Land Acquisition Officer,
\n                          41<\/span><\/p>\n
       South 24 – Parganas, 5th Floor,
\n       New Treasury Buildings,<\/p>\n
       Alipore,Kolkata – 700027.\n<\/p>\n
Sir,<\/p>\n
       Re: Barakhola Mouza J.L.No.21 P.S.Kasba<\/p>\n
            This    has   reference   to  your
\n       acquisition notice dated 12.1.2001 for
\n       12.67 acres land in Plot No.125 & 126 of
\n       the subject mouza.\n<\/p>\n
             In this connection, I would like to
\n       submit that I am the Power of Attorney
\n       (Registered) holder of the successors of
\n       late Abhay Pada Pain who was the owner
\n       of the aforesaid plots as evident from the
\n       ROR. A copy of the P\/A is enclosed for
\n       your kind perusal. Incidentally Plot
\n       No.126 was duly demarcated showing the
\n       vested portions and the retained portions
\n       by the District Authorities as per copy of
\n       the Map enclosed along with a copy of the
\n       Minutes of the meetings held in Chamber
\n       of the then ADM & L.R.O.South 24 –\n<\/p>\n
       Parganas on 20.3.1996.\n<\/p>\n<\/p>\n
             Subsequently 13.56 acres of land
\n       was sold to the following parties and
\n       registered under section 41 on 25.6.1999
\n       of which deed copies are enclosed. Since
\n       the tax has not been assessed, as yet for
\n       value to ascertain additional stamp duty,
\n                      42<\/span><\/p>\n
  the same have not been paid so far.\n<\/p>\n
  However, enquiries are under way, but in
\n  the meantime Khazna has been paid up –\n<\/p>\n
  to – date as per copies of receipts
\n  dt.18.1.2001 enclosed herewith.\n<\/p>\n
  The   transfers are:-\n<\/p>\n
  a)     Sri Debabrata Choudhary             :\n  b)     Sri Shreekanta Ray            : 6.00 acres\n  c)     M\/s. Anarean Estate Co.Ltd. :\n  d)     Sri Swadesh Ghosh             :\n  e)     Sri Swapan Dey                :\n  f)     Smt.Ila Dey                   : 6.58 acres\n  g)     Sri Saptashi Dey            :\n  h)     Smt.Basanti Ghosh             :\n\n\n\n        The aforesaid     transferees did not\n<\/pre>\n
  raise any objection to govt. acquiring. The
\n  land for housing, in face, I had moved an
\n  idea to West Bengal Housing Board and
\n  willing to negotiate along with the
\n  transferees’ price for your acquisition.<\/p>\n
       Please do let me known for any
\n  further information and clarification \/
\n  assistance, a may be required.\n<\/p>\n
Thanking you, I am
\n                                  Yours faithfully<\/p>\n
                                Sd\/-Urmila Ray
\n                               Constituted Attorney of
\n                                 Smt. Lily Paul
\n                              43<\/span><\/p>\n
                                          Smt. Dolly Paul<\/p>\n
                                          Smt.     Mira     Rani
\nBasu
\nEnclosed<\/p>\n
a)    Copies of 8 nos.deed\n<\/p>\n
b)    Copy of power of attorney\n<\/p>\n
c)    Copy of witness by ADM,DL,LRO\n<\/p>\n
d)    Copy of Minutes of meeting dt.<\/p>\n
      26.3.96\n<\/p>\n
e)    Copy of Khana receipts<\/p>\n
C 735407 dt.Rs.32,277\/-\n<\/p>\n
C 735408 dt.18.1.01 for Rs.2709″\n<\/p>\n<\/p>\n
22.   It is significant that this letter written by the Attorney<\/p>\n
Urmila Roy, on behalf of all the land owners spells out that the<\/p>\n
owners had in fact been willing to negotiate the price for the<\/p>\n
land at the time when the acquisition were still incomplete as<\/p>\n
only the Notification under Section 4 of the Act had, at that<\/p>\n
stage, been issued (4th December 2000). It is also significant<\/p>\n
that the declaration under Section 6 had been issued on 29th<\/p>\n
November 2001 and the award rendered on 27th December<\/p>\n
2003.   It is, therefore, evident that the land owners had, in
\n                              44<\/span><\/p>\n
fact, acquiesced to the acquisition and cannot now turn<\/p>\n
around to say that the acquisition was bad in law.<\/p>\n
23.   In view of the above findings, we are of the opinion that<\/p>\n
no further discussion on the other marginal issues that have<\/p>\n
been raised, needs to be made. The appeals are, accordingly,<\/p>\n
dismissed.\n<\/p>\n<\/p>\n
                               ………………………………J.
\n                               (TARUN CHATTERJEE)<\/p>\n
                               ……………………………….J.
\n                               ( HARJIT SINGH BEDI )
\nNew Delhi,
\nDated: March 23, 2009<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Urmila Roy & Ors vs M\/S Bengal Peerless … on 23 March, 2009 Author: H S Bedi Bench: Tarun Chatterjee, Harjit Singh Bedi REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NOS. 1780-1781 OF 2009 (Arising out of SLP) Nos.16336-16337 of 2007) Urmila Roy & Ors. ……Appellants […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-130681","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nUrmila Roy & Ors vs M\/S Bengal Peerless ... on 23 March, 2009 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/urmila-roy-ors-vs-ms-bengal-peerless-on-23-march-2009\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Urmila Roy & Ors vs M\/S Bengal Peerless ... on 23 March, 2009 - 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