Smt. Somavanti And Others vs The State Of Punjab And Others

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Petitions Nos. 246 to 248 of 1961

Decision Date: 2 May 1962

Coram: J.R. Mudholkar, Bhuvneshwar P. Sinha, N. Rajagopala Ayyangar

The case was styled Smt Somavanti and others versus The State of Punjab and others, and the judgment was delivered on 2 May 1962 by the Supreme Court of India. The opinion was authored by Justice J R Mudholkar, who was joined by Justices Bhuvneshwar P Sinha and N Rajagopala Ayyangar. The bench composition is recorded as Justice J R Mudholkar, Justice Ayyar, Justice T L Venkatarama Sinha, Chief Justice Bhuvneshwar P, Justice Subbarao K Ayyangar, and Justice N Rajagopala. The decision appears in the law reports as 1963 AIR 151 and 1963 SCR (3) 774. The judgment has been subsequently referenced in many reports, including 1963 SC 1890 (5), 1965 SC 646 (9), 1966 SC 1788 (19A, 21), 1967 SC 1074 (9), 1967 SC 1081 (3), 1968 SC 432 (15), 1970 SC 984 (7), 1971 SC 306 (10), 1971 SC 1033 (8‑9), 1973 SC 974 (10), 1973 SC 1461 (1071), 1975 SC 1182 (3), 1977 SC 183 (6), 1978 SC 515 (3‑4‑6), 1979 SC 1713 (5), 1980 SC 214 (20), 1980 SC 1678 (4), 1984 SC 120 (4), 1985 SC 1622 (13), 1988 SC 501 (5), 1988 SC 686 (18), 1988 SC 1353 (18), 1989 SC 682 (4‑7), 1989 SC 2105 (6), and 1992 SC 1456 (30). The matters discussed involve the Land Acquisition Act of 1894, particularly sections 4, 5A and 6, the Indian Evidence Act of 1872, sections 3 and 4, the Constitution of India article 14, and the principles of public purpose, conclusive evidence, and compensation.

In February 1961 the petitioners purchased more than six acres of land situated in the State of Punjab for a total consideration of Rs 4,50,000, asserting that the acquisition was intended to establish a paper mill. Meanwhile, a private limited company that later became the sixth respondent held a licence from the Government of India to set up a factory for manufacturing a wide range of refrigeration compressors and ancillary equipment. That company applied to the State of Punjab for allocation of a suitable site for its proposed factory. On 18 August 1961 the Governor of Punjab issued a notification under section 4 of the Land Acquisition Act, 1894, declaring that the land owned by the petitioners was likely to be required by the Government for a public purpose, specifically the establishment of the refrigeration‑compressor factory. The notification further directed that action under section 17 of the Act be taken because of urgency, and it stipulated that the provisions of section 5A would not apply to this acquisition. A subsequent notification published in the official Gazette on 19 August 1961, made under section 6 of the Act, stated that the Governor was satisfied that the land was needed by the Government at public expense for the stated purpose, and it authorized the immediate taking of possession of the property.

In the matter before the Court, the Government of Punjab, on 29 September 1961, authorized an outlay of one hundred rupees for the purpose of acquiring certain land. The land in question had previously been the subject of notifications issued under sections 4 and 6 of the Land Acquisition Act, 1894, which declared that the land would be required by the Government at public expense for establishing a factory that would manufacture various ranges of refrigeration compressors and ancillary equipment. The petitioners subsequently filed an application under article 32 of the Constitution of India, contesting the legality of the Government’s action. Their challenge was based on several grounds. First, they asserted that the acquisition did not satisfy the requirement of a public purpose under either section 4 or section 6 of the Land Acquisition Act. Second, they alleged that the land was actually being taken for the benefit of the sixth respondent, thereby constituting discrimination against the petitioners and violating article 14 of the Constitution. Third, they contended that the nominal contribution of one hundred rupees by the Government was a colourable exercise of power, because the sum was negligible compared with the value of the property and could not demonstrate genuine Government participation in the proposed activity. Finally, they argued that the notifications made under sections 4 and 6 could not be issued simultaneously and therefore lacked legal effect.

The Court, speaking through its judges, held that the declaration made by the Government in the notification under section 6(1) of the Land Acquisition Act, 1894, that the land was required for a public purpose, was conclusive under subsection 3 of section 6. Accordingly, the Court stated that it was not within its jurisdiction to look behind the declaration and determine whether the acquisition truly served a public purpose. The determination of whether a particular purpose qualified as a public purpose was left to the satisfaction of the Government, and such a declaration would remain final except in the limited circumstance where the power was exercised in a colourable manner, in which case it could be challenged by the aggrieved party. The Court distinguished earlier decisions such as Hamabai Framjee Petit v. Secretary of State for India and R. L. Arora v. The State of Uttar Pradesh, while approving the reasoning in Vedlapatla Suryanarayana v. The Province of Madras. The Court further observed that there was no substantive difference between the terms “conclusive evidence” in section 6(3) and “conclusive proof,” as both aimed to give finality to the establishment of a fact based on proof of another fact. Moreover, the Court emphasized that the conclusiveness attached to section 6(3) applied not only to the existence of a “need” but also to the question of whether the purpose for which the land was needed qualified as a public purpose; a “need” could not exist in the abstract without such a qualification. Consequently, the provisions of the Act that rendered the State’s declaration that a particular land was needed for a public purpose as conclusive evidence of that fact did not contravene the Constitution.

The Court observed that the declaration that the land was needed for a public purpose did not violate any provision of the Constitution. The Court relied on the earlier decisions of State of Bihar v. Maharajadhiraja Sir Kameshwar Singh of Darbhanga & Ors., [1952] S. C. R. 889, Babu Barkya Thakur v. State of Bombay & Ors., [1961] 1 S. C. R. 128, and State of Bombay v. Bhanji Munji & Anr., [1955] 1 S. C. R. 777. The Court further held that it was within the authority of the State to decide which particular industry could be regarded as beneficial to the public and to determine that the establishment of such an industry would serve a public purpose. Because this determination was a legislative judgment, the Court concluded that no question of discrimination arose merely because the Government had declared the establishment of the particular industry to be a public purpose. Consequently, the notifications under consideration did not offend Article 14 of the Constitution.

The Court also considered the procedural aspect of the notifications. It noted that, with Section 5A removed from consideration, the publication of both notifications – the one dated 18 August 1961 and the one dated 19 August 1961 – in the Gazette was regular and not irregular. In a dissenting opinion, Justice Subba Rao stated that the notification dated 19 August 1961, made under Section 6 of the Land Acquisition Act, 1894, could not be declared invalid simply because the amount contributed by the State toward the cost of acquisition – Rs 777 – was only nominal in relation to the overall value of the land. The phrase “party out of public revenues” in the proviso to Section 6(1) of the Act, Justice Subba Rao explained, did not require the State’s contribution to be substantial; rather, whether a token contribution satisfied the statutory requirement depended on the facts of each case and was a matter for the court to determine in every instance. The Court cited Sanja Naicken v. Secretary of State, (1926) I. L. R. 50 Mad. 308 and Vadlapatla Suryanarayana v. The Province of Madras, 1 L. R. [1946] Mad. 153 as authorities approving this approach, while disapproving Ponnaiah v. Secretary of State, A. I. R. 1926 Mad. 1099. The cases of Chatterton v. Cave, (1878) 3 App. Cas. 483 and Maharajah Lachmeswar Singh v. Chairman of the Darbhanga Municipality, (1890) L. R. 17 I. A. 90 were held to be inapplicable. In interpreting the proviso to Section 6(1), Justice Subba Rao held that the expression “wholly or partly” should be given a reasonable meaning, requiring that any part of the compensation paid by the State have a rational relation to the total compensation payable for a public‑purpose acquisition. Accordingly, the term “part” could be understood only as a substantial part of the estimated compensation, and what constituted a substantial part would vary with the facts of each case. Applying this principle to the present matter, the Court found it impossible to regard a contribution of Rs 100 out of an estimated compensation that could exceed Rs 4,00,000 as a substantial part of the compensation. The Government had therefore breached the statutory condition, and, as a result, the Court concluded that the State lacked jurisdiction to issue the declaration under Section 6 of the Act.

The Court observed that because the Government had broken the condition mentioned earlier, it possessed no authority to make the declaration contemplated by section six of the 1894 Land Acquisition Act. The matter was placed before the original jurisdiction of the Supreme Court under petitions numbered 246 to 248 of 1961. These petitions were filed under article thirty‑two of the Constitution of India for the enforcement of fundamental rights. Counsel for the petitioners appeared on behalf of the petitioners in petition number 246, while the same counsel also represented the petitioners in petitions numbers 247 and 248. Counsel for the State of Punjab, who was the Advocate‑General, appeared for respondent number one in all the petitions. Counsel for respondent number six was present in all the petitions, and the Additional Solicitor‑General of India, together with counsel for the intervenor State of Gujarat, also participated in each petition. The judgment was delivered on 2 May 1962, and the opinions of Chief Justice Sinha, Justice Rajagopala Ayyangar, Justice Madholkar and Justice Venkatarama Aiyar were read out by Justice Mudholkar.

The petitioners had purchased more than six acres of land in February 1961 for a total consideration of rupees four lakh fifty thousand nine by executing five sale deeds and one lease deed. Their intention was to establish a paper mill in collaboration with the firm R. S. Madhoram and Sons, which already held a licence for a paper plant at Ghaziabad in Uttar Pradesh. The land in question lay in the village of Meola Maharajpur, tehsil Ballabhgarh, district Gurgaon, adjacent to the Mathura Road and situated roughly ten to twelve miles from New Delhi. Respondent number six, Air Conditioning Corporation (P) Ltd., is a private limited company that possesses a licence from the Government of India to set up a factory for manufacturing various types of refrigeration compressors and related equipment. Initially, the project had been allocated to the State of West Bengal, but at the request of the State of Punjab the location was shifted to Punjab, and respondent number six subsequently sought from the State of Punjab an appropriate site for its factory. The petitioners claim that respondent number six, interested in acquiring land in Meola Maharajpur, approached the State of Punjab in or about March 1961 to acquire land for its factory under the 1894 Act. Upon learning of this, one petitioner filed an application on 23 March 1961 with the Deputy Commissioner of Gurgaon, asking that none of the land bought by the petitioners be taken for the benefit of respondent number six. Adjacent landowners—Mr Om Prakash, Mr Ram Raghbir, Mr Atmaram Chaddha and Mr Hari Kishen, who are petitioners in writ petitions 247 and 248 of 1961—made similar requests, and the petitioners allege that the Deputy Commissioner gave them assurance that their lands would not be acquired for the benefit of respondent number six.

The Deputy Commissioner of Gurgaon had assured the petitioners that their lands would not be taken for the benefit of respondent No 6. Nevertheless, respondent No 6 acquired, by private treaty, a plot of land measuring roughly 70,000 square yards that lay contiguous to the petitioners’ property on or about 21 April 1961. The petitioners complained that, despite the earlier assurances, the Governor of Punjab issued a notification dated 25 August 1961 under section 4 of the Land Acquisition Act, 1894, declaring that the lands owned by the petitioners in the present petition, as well as those owned by the petitioners in two other writ petitions, were likely to be required by the Government at public expense for a public purpose. The specified public purpose was the establishment of a factory for manufacturing various ranges of refrigeration compressors and ancillary equipment. The notification further stated that the land situated in the described locality was required for that purpose and authorised the Sub‑Divisional Officer and the Land Acquisition Officer at Palwal to enter upon and survey the land and to perform all other acts permitted by section 4 of the Act. Because of urgency, the notification directed that action be taken under section 17 of the Act and expressly excluded the application of the provisions of section 5A.

Subsequently, on 19 August, the Governor of Punjab issued another notification under section 6 of the Act, declaring that he was satisfied that the land specified in the earlier notification was required by the Government at public expense for the same public purpose of setting up a refrigeration‑compressor factory and ancillary equipment. This declaration, addressed “to all whom it may concern,” instructed the Sub‑Divisional Officer of Palwal to take all necessary steps for acquiring the land and provided for the immediate taking of possession of the land under clause (c) of section 17(2). Both the section 4 notification and the section 6 declaration were published in the Punjab Government Gazette on 25 August 1961.

The petitioners contend that these notifications and the consequent land‑acquisition proceedings violate their fundamental rights under Article 19(1)(f) and (g) of the Constitution, which guarantee the right to possess property and to carry on any occupation, trade or business. Accordingly, they seek the quashing of the acquisition. The petitioners maintain that they purchased the land in good faith for industrial purposes, noting that surrounding land was being acquired by industrialists for various projects. They assert that their intended use is to establish a paper‑manufacturing plant, having entered into an arrangement with Messrs R S Madho Ram & Sons, holders of industrial licence No L/2‑1/2 (1)/N‑60/62. The proposed enterprise is projected to employ about two hundred persons and, in their view, represents a new industry, whereas respondent No 6 is already engaged in the refrigeration‑equipment business and has an existing plant at Hyderabad in the State of Andhra Pradesh.

The petitioners were informed that respondent No. 6 was already operating in the refrigeration industry and, according to their knowledge, had established a factory for manufacturing refrigeration equipment at Hyderabad in the State of Andhra Pradesh. The petitioners further noted that, after the acquisition notification was published, the Government of Punjab on 29 September 1961 authorised an expenditure of one hundred rupees for the purpose of acquiring the disputed land. The petitioners characterised this expenditure as a token amount and an after‑thought, asserting that such a small contribution could not demonstrate that the acquisition was being made, even partly, at public expense.

The petition for acquisition was opposed not only by respondent No. 6 but also by the State of Punjab, which was respondent No. 1. Respondent No. 1 denied that the petitioners had purchased the land for a genuine industrial purpose and maintained that the petitioners would not actually use the land for such a purpose. It also rejected any claim that the petitioners had been given an assurance that their lands would not be acquired. However, respondent No. 1 admitted that respondent No. 6 had made an application in December 1960 for land to set up its factory and that the Punjab Government had agreed to take the necessary steps.

According to respondent No. 1, the acquisition proceedings were undertaken for a public purpose and at public expense, as stated in the notification, and that the State Government would contribute part of the compensation out of public revenues. It argued that the State’s action was lawful because it complied with sections 4 and 6 of the Land Acquisition Act, was undertaken in good faith, and that the declaration made by the Government served as conclusive evidence under sub‑section (3) of section 6 that the land was needed for a public purpose. The respondent further contended that, although the two notifications were issued on different dates, both were published in the same Gazette issue and were therefore perfectly valid.

Respondent No. 1 asserted that the land was not being acquired for a private company but for a public purpose, rendering the provisions of Part VII of the Act inapplicable. It observed that the lands were vacant, their owners would receive compensation determined by the Land Acquisition Officer, and that no deprivation of the petitioners’ fundamental rights under article 19(1)(f) and (g) or violation of article 14 arose. Consequently, the respondent maintained that the petitioners were not entitled to any relief beyond the compensation payable for the loss incurred by the acquisition.

Finally, respondent No. 1 stated that the land acquired by respondent No. 6 through private negotiation lacked access to the main road and was insufficient to meet the minimum essential requirements, making the acquisition of the lands in question necessary.

The respondent No 6 explained that the land in question did not have direct access to the main road and was too small to satisfy the minimum essential requirements for its intended use, making acquisition of the said parcels necessary. It was further submitted that a factory of the type contemplated by the respondent was urgently needed in India because the manufacturing of compressors and the components for large and small air‑conditioners, refrigerators, water coolers and cold‑storage cabinets had not been undertaken anywhere in the country up to that time. The respondent argued that imports of these items consumed a considerable amount of foreign exchange, and that establishing domestic production would not only conserve foreign exchange but also eventually generate foreign earnings through export of the manufactured goods. Accordingly, the respondent maintained that the purpose of setting up the factory should be regarded as a public purpose, since the manufacture of those articles was intended, inter alia, to meet the needs of the public at large. In view of these considerations, the Government of India, acting on the recommendation of the licensing committee formed under the Industries Development and Regulation Act, 1951, had granted a licence to the respondent on 8 April 1951. The respondent further pointed out that it had secured the collaboration of a well‑known American firm, Borg‑Warner International Corporation of Chicago, which was the world’s largest manufacturer of air‑conditioning plants and equipment, and that this collaboration agreement had received approval from the Ministry of Commerce, Government of India. The respondent’s grievance was that the collaboration had not yet been implemented because it had been unable to obtain land on which to construct the building required to house the necessary machinery and implements. The respondent also stated that the original licence had been issued for establishing a factory in the State of West Bengal, but that, at the request of the Government of Punjab, the Central Government had allowed the location of the factory to be shifted from West Bengal to Punjab. The respondent projected that, once operational, the factory would likely employ at least 1,000 workers. The Court noted that it was not necessary to refer to the other affidavits and rejoinder affidavits except for certain portions of an additional affidavit filed by Mr. M. B. Bhagat, Under Secretary, on behalf of respondent No 1, and that only those portions which had been relied upon during the arguments before the Court were relevant. In that affidavit, respondent No 1 denied that any licence had been granted to Messrs. R. S. Madho Ram & Sons for establishing a paper plant in Punjab. Respondent No 1 further contended that Messrs. R. S. Madho Ram & Sons had been granted a licence on 17 August 1960 for setting up an industrial undertaking in Ghaziabad, Uttar Pradesh, for the manufacture of writing and printing paper and pulp.

It was further explained that the licence referred to earlier had been cancelled by the Government of India through a letter dated 31 January 1962 because the licence holder had failed to take any effective steps to establish the undertaking. The statement then described that the Air Conditioning Corporation, which had originally been incorporated as a private limited company, had, with the permission of the Central Government, been converted into a public limited company named “York India Ltd.” and that this company had obtained a licence from the Industrial Licensing Committee to manufacture refrigeration equipment. An agreement was said to exist between York India Ltd. and Messrs. York Corporation, U.S.A., a subsidiary of Borg Warner of the United States, under which the latter party had undertaken to provide all technical assistance and technical training to Indian personnel and to contribute fifty per cent of the initial investment in the project. Respondent No. 6 projected that it would manufacture seventy per cent of the equipment in the very first year and would increase that share to one hundred per cent by the end of 1966. The statement added that the foreign collaborators had also agreed to sell the firm’s products outside India on prices, terms and conditions most favourable to the Indian company, thereby enabling it to gain access to foreign markets. The foreign collaborator would make available to Indian personnel the necessary technical know‑how and other information required for the manufacture of refrigeration materials, and such assistance was described as being of considerable value. Respondent No. 6 denied that it had established any factory comparable to the one now proposed to be set up in Hyderabad, a contention raised by the petitioners. It was admitted, however, that licences had been granted to two other Indian concerns for the manufacture of similar equipment, but neither of those licencees had actually commenced production up to the present time; consequently, it was asserted that it would be inaccurate to claim that similar equipment was already being manufactured in India. The statement further quoted that the products which the respondent intended to manufacture had until then been imported into India, amounting to approximately Rs 3,83,70,000 in 1960 and, for the first ten months of 1961, about Rs 3,56,50,000 imported by various licence‑holders holding import licences. It also mentioned that respondent No. 6 had originally been granted a licence to establish a factory in West Bengal, but because no licence for such a factory had been granted in Punjab, the licence was transferred to Punjab. The proposed factory was said to create a large number of jobs and thereby help to alleviate, to some extent, the existing problem of unemployment in Punjab. Finally, it was contended that the establishment of the factory would further the industrial development of the State of Punjab and, therefore, would constitute a public purpose. On behalf of the petitioners, counsel raised five specific contentions, the first of which was that the acquisition was not for a public purpose within sections 4 or 6 of the Land Acquisition Act, nor for a purpose useful to the public as contemplated in section 41, and that the Government’s action amounted to acquiring property from one person and transferring it to another.

The petitioners advanced five separate pleas. First, they argued that the acquisition did not fall within a public purpose as defined in section 4 or section 6 of the Acquisition Act, nor did it serve any purpose useful to the public contemplated in section 41; consequently, they claimed that the Government’s action amounted merely to taking property from one individual and handing it over to another. Second, they contended that the Government’s nominal contribution of one hundred rupees was a colourable exercise of power; they pointed out that no intention to contribute was mentioned before the notification and that the amount of one hundred rupees was so trivial compared with the market value of the land that it could not support any inference of genuine Government participation in the proposed scheme. Third, they maintained that the land was in truth being acquired for a private company, and that because the provisions of Part VII of the Acquisition Act were not observed, the acquisition was void. Fourth, they asserted that the petitioners’ own proposal to establish a paper mill would be as competent an industrial undertaking as the factory intended for respondent No 6, and that the Government’s choice to favour the latter over the former breached the guarantee of equal protection of the law under article 14 of the Constitution. Fifth, they argued that the notification made under sections 4 and 6 could not be issued at the same time and therefore was legally ineffective.

The Court indicated that it would first address the third plea raised by counsel for the petitioners, namely the alleged failure to comply with the requirements of Part VII. The Court observed that there was unanimous agreement that those statutory requirements had indeed not been satisfied. The respondents explained that the acquisition was not intended for a private company but for a public purpose, to be carried out partly at public expense. Because the respondents never invoked the provisions of Part VII in support of their case, the Court identified the central issue as whether the acquisition truly served a public purpose and was partially funded by the public. The Court noted that if the acquisition were found to be for a public purpose and partially at public expense, the petitioners’ challenge would fail. Consequently, the Court determined that the first two contentions—the lack of a public purpose under sections 4, 6 and 41, and the insignificance of the one‑hundred‑rupee contribution—required primary consideration.

Turning to the evidence, the Court examined the affidavits submitted on behalf of the State and of respondent No 6. Those affidavits, according to counsel for the petitioners, clearly indicated that the land was being taken to enable respondent No 6 to secure access to a main road and to satisfy the minimum requirements for establishing its factory. The affidavits further specified that the compensation for the entire tract of land would be borne not by the State Government but by respondent No 6 itself. While the Government had announced a sanction of one hundred rupees toward compensation, the Court observed that this amount represented an insignificant fraction of the total compensation likely to be payable. In contrast, the petitioners had already paid four hundred and fifty thousand rupees to the individuals from whom they had acquired the land, underscoring the disparity between the Government’s token contribution and the actual financial implications of the acquisition.

In the arguments presented on behalf of the respondents, the Advocate‑General for Punjab asserted that the government’s declaration in the notification that the land is required for a public purpose is conclusive under sub‑section 3 of section 6 of the Act, and therefore the Court is not entitled to look beyond that declaration to determine whether the acquisition truly serves a public purpose. He further argued that, even if the Court were to examine the purpose, the acquisition should be regarded as for a public purpose because its objective is to establish a new industry that will eliminate imports of refrigeration equipment, provide technical education to Indian personnel in a new field, and generate foreign‑exchange savings as well as earnings from the export of goods manufactured at the proposed factory. He emphasized that the new industry is of considerable economic importance because it will enable the preservation of food that would otherwise be lost, and because refrigeration equipment is essential for maintaining health by allowing the storage of medicines such as antibiotics that would decompose at ordinary temperatures prevailing in the country. The Advocate‑General also highlighted that the proposed industry will create a new source of employment, reduce unemployment, and generally promote industrial development. In addition, a portion of the land is required for constructing houses and quarters for factory workers and for providing them with necessary amenities, all of which he described as public purposes. To support these assertions, he referred to volume 19 of the Encyclopaedia Britannica, pages 49‑57, which outlines the many applications of refrigeration in various industries and activities, and to volume 18, page 745, where refrigeration facilities are grouped under the heading “Public utility.” He also quoted a passage stating that every public utility must possess natural resources on which the industry is based, that strategic locations are required, and that limitations in site choice increase acquisition costs; consequently, utilities are granted the governmental power of eminent domain to permit the compulsory sale of private property. Relying on the affidavit of Mr Bhagat, which had been previously referenced, the Advocate‑General reiterated that the government’s purpose in acquiring the land is to enable a new industry to be established not only for saving foreign exchange and earning foreign exchange but also for securing industrial advancement, providing technical education, and alleviating unemployment.

The learned Advocate‑General maintained that, even though the majority of the compensation for the acquisition would be paid by respondent No 6, the acquisition should be treated as being for a public purpose because it would relieve unemployment pressure and achieve other societal benefits. The Court observed that the issue of whether any of those objectives qualifies as a public purpose would arise for judicial consideration only in the event that the Government’s declaration were not decisive or if the Government’s action were a colourable exercise of power. The Court further noted that, if, as the Advocate‑General contended, subsection 3 of section 6 settles the matter, and provided that the validity of that provision is not challenged and the Government’s action is not colourable, then no separate enquiry into the public‑purpose question would be necessary.

The petitioners strongly argued that subsection 3 of section 6 does not prevent the Court from examining whether the intended acquisition is for a public purpose. They asserted that the provision merely renders the Government’s declaration “conclusive evidence” rather than “conclusive proof,” and that the declaration is conclusive evidence only of a need, not of any further purpose. The petitioners sought to draw a distinction between “conclusive proof” and “conclusive evidence.” They explained that when a statute declares that one fact is conclusive proof of another, the Court is barred from considering any additional evidence once that fact is established; the fact is then deemed proved and the Court must proceed on that basis. Conversely, they argued, where a statute stops short of making a fact conclusive proof and instead labels it merely “conclusive evidence” of another fact, other evidence relating to the existence of the second fact is not excluded.

To support this line of reasoning, the petitioners relied upon section 4 of the Indian Evidence Act, whose third paragraph defines “conclusive proof” as follows: “When one fact is declared by this Act to be conclusive proof of another, the Court shall, on proof of the one fact, regard the other as proved, and shall not allow evidence to be given for the purpose of disproving it.” They pointed out that this provision bars further evidence only when the Evidence Act itself makes a fact conclusive proof of another, and that it says nothing about the effect of other statutes that may use the language “conclusive evidence.” The petitioners cited several statutes that describe certain facts as conclusive evidence of other facts, including section 132 of the Companies Act 1956, section 381 of the Indian Succession Act 1925, section 61 of the Christian Marriages Act 1872, section 38 of the Madras Revenue Act 1869, and section 11 of the Oaths Act 1873. They asked whether such provisions also exclude the admission of additional evidence after the conclusive‑evidence fact has been produced. Finally, they emphasized that the purpose of presenting evidence is to prove a fact, and that the Indian Evidence Act deals with the question of what kinds of evidence may be adduced for that purpose.

The Court examined the provisions governing the admissibility of evidence and the meaning of proof under section 3 of the Indian Evidence Act. Section 3 defined “evidence” to include: (i) all oral statements that the court permits or requires from witnesses in relation to matters of fact under inquiry, referred to as oral evidence; and (ii) all documents produced for the court’s inspection, referred to as documentary evidence. The section further explained that a fact was said to be proved when, after considering the matters before it, the Court either believed the fact to exist or regarded its existence as so probable that a prudent person, under the circumstances of the particular case, ought to act on the supposition that it existed. From this definition, the Court inferred that when legislation designates a particular kind of evidence as “conclusive” as to the existence of a fact, that fact may be proved either by that conclusive evidence or by other evidence that the Court permits or requires. If other evidence is presented, the Court remains free to assess whether, on the basis of that evidence, the fact exists. Conversely, when evidence expressly declared conclusive is adduced, the Court has no discretion but to accept that the fact exists; otherwise the label “conclusive evidence” would be meaningless. Accordingly, once the law declares certain evidence conclusive, it excludes any additional evidence that could undermine its conclusiveness. The Court therefore held that there is no substantive distinction between “conclusive evidence” and “conclusive proof.” While statutes may employ the term “conclusive proof” to render a fact non‑justiciable, legislatures may use “conclusive evidence” to achieve the same effect. In both instances, the purpose is to give finality to the establishment of a fact on the basis of another proved fact.

Counsel for a party argued that the Court could examine whether an executive action, even without an allegation of mal‑feasance, related to the statutory provision and whether the acquisition served a public purpose. To support this position, counsel relied on the decision in State of Bihar v. Maharajadhiraja Sir Kameswarsingh of Darbhanga, reported as 1 [1952] S.C.R. 889 935. In that case, Mahajan J, as he then was, expressed the view that the power of compulsory acquisition was conditional upon the existence of a public purpose and that this condition, although not expressly stated in Article 31(2) of the Constitution, was inherent in the very content of the power itself. The Court noted, however, that this perspective was not shared by the other judges who constituted that bench, indicating a divergence of opinion on whether the declaration of public purpose by the Government is justiciable. The present argument therefore placed emphasis on interpreting the statutory language in light of this earlier authority, seeking to determine whether the legislative intent required judicial scrutiny of the public‑purpose requirement.

The Court observed that other learned judges who formed the Bench also held that a public purpose is an implied condition of Article 31(2). In particular, Mukherjea, J., when he served as a judge, expressed that the requirement of a public purpose is contained implicitly in Article 31(2), referring to pages 957 and 958 of the report. Das, J., in his earlier capacity, concurred with the same view, as recorded on pages 986‑988. Likewise, Chief Justice Patanjali Sastri held that the existence of a public purpose constitutes an express condition of clause 2 of Article 31. The Constitution, therefore, authorises the State to acquire private property only when such acquisition is needed for a public purpose.

The Court then considered whether a statute must be interpreted so that a governmental declaration of public purpose becomes subject to judicial review. The matter before the Court did not involve a post‑Constitution enactment but a pre‑Constitution law that has been in operation since 1894. The validity of that Act was challenged in Babu Barkya Thakur v. State of Bombay, on the ground that it infringed Articles 31(2) and 19(1)(f) of the Constitution. The Court held that, because the Act predates the Constitution, it is shielded from the operation of Article 31(2) by virtue of Article 31(5)(a). The Court also relied on the decisions in State of Bombay v. Bhanji Munji and Lilavati Bai v. State of Bombay, concluding that a challenge based on Article 19(1)(f) was futile.

The Court noted that the protection afforded by Article 31(5)(a) applies only to the extent that the Act cannot be attacked on the ground of inconsistency with Article 31(2). That protection does not extend to other provisions of Part III, such as Article 19(1)(f). According to the judgment in Bhanji Munji’s case, a person can invoke the right to property under Article 19(1)(f) only if he possesses the property about which he claims the right. If possession is taken away by a law protected under Article 31(5)(a), the right under Article 19(1)(f) does not arise. This principle has been consistently followed in two subsequent cases, and all those decisions are binding on the present Court.

The petitioner argued that none of the cited decisions examined the proposition that a law, while protected from attack under Article 31(2), might still be invalid under Article 13(2) if the restriction on property rights is unreasonable. In other words, for the present law to be regarded as valid, it must also satisfy the requirements of Article 19(5).

The Court explained that a person’s property could be removed only after the State had made a formal declaration that the land was required for a public purpose. It noted that, although the Court had not expressly ruled on this precise aspect, it remained bound by earlier judgments that categorically rejected any challenge grounded on the right secured by Article 19(1)(f). The Court further clarified that the binding force of a precedent did not hinge on whether a specific argument had been considered in that case, so long as the issue to which the argument later related had been actually decided. That precise issue, the Court observed, had been expressly resolved in the three decisions previously cited. Consequently, the Court held that, because the Act stipulated that a State declaration that a particular piece of land was needed for a public purpose constituted conclusive evidence of such a need, the Constitution was not infringed by that declaration.

To determine the extent to which the State’s determination was conclusive, the Court found it appropriate to examine the relevant provisions of the Act. The preamble of the Act declared that its purpose was the acquisition of land needed for public purposes, for companies, and for incidental matters connected therewith. Section 2(f) defined “public purpose” as follows: “the expression ‘public purpose’ includes the provision of village sites in districts in which the appropriate Government shall have declared by notification in the Official Gazette that it is customary for the Government to make such provision.” The Court described this definition as inclusive rather than exhaustive, noting that it did not substantially aid in delineating the precise scope of the term “public purpose.” Nonetheless, the Court explained that, in a broad sense, a public purpose would encompass any purpose in which the general interest of the community, as opposed to the private interest of individuals, was directly and essentially concerned.

The Court then turned to Section 4, which empowered the State to issue a preliminary notification whenever it appeared that land in any locality was needed or was likely to be needed for a public purpose. The Court observed that the remaining provisions of that section were irrelevant to the matter before it and therefore required no further discussion. Section 5A, the Court noted, granted any person having an interest in land that had been notified as needed or likely to be needed for a public purpose—or for a company—the right to object to the acquisition of that land. Such objections had to be heard by the Collector, who could, after conducting any further inquiries he deemed necessary, forward the record along with his report and recommendations to the appropriate Government. Subsection (2) of Section 5A rendered the Government’s decision on those objections final. Finally, Section 6(1) required that when the Government was satisfied that a particular piece of land was needed for a public purpose or for a company, it should issue a declaration to that effect and publish that declaration in the Official Gazette.

Section 6 of the Act requires that a declaration be published in the Gazette, and Sub‑section (2) mandates that the declaration set out the specific purpose for which the land is required. Sub‑section (3) then makes that declaration conclusive evidence that the land is needed either for a public purpose or for a company, as the situation demands. Section 17 of the Act grants the Government special powers that may be exercised in emergencies. Sub‑section (4) of that section provides that, in cases falling under Sub‑section (1) or Sub‑section (2), the appropriate Government may order that the provisions of Section 5A shall not apply, and may also make a declaration under Section 6 with respect to the land to be acquired at any time after the notification issued under Sub‑section (1) of Section 4 has been published. These provisions are the ones that bear directly on the point before the Court. The language of the statute shows that the purpose of the law is to empower the Government to acquire land only when it is needed for a public purpose or for a company, and that, when the acquisition is for a company, the process must follow the requirements of Part VII. The Court, referring to the decision in R L Arora v State of Uttar Pradesh (1) (1962) Supp. 2 S.C.R. 149, noted that the acquisition for a company contemplated by Part VII is limited to situations where the Government is satisfied that the land is required for erecting dwelling houses for workmen employed by the company, for providing amenities directly connected with such housing, or for constructing a work that will be directly useful to the public.

After a notification under Sub‑section (1) of Section 4 is published, any person who has an interest in the land may object to the acquisition. Such an objection may be based on any ground, for example, that the land is not actually needed for any purpose, that it is unsuitable for the purpose claimed, that the purpose is not a public purpose, or that the entity alleged to be a company is not a company at all. The decision of the Government on these objections is final, and Section 6 allows the Government to make a declaration only when it is satisfied that the land is needed for a public purpose or for a company. While the State Government, in an emergency, may invoke its powers under Sub‑section (4) of Section 17 to declare that the provisions of Section 5A shall not apply, it is still necessary to interpret Section 6 in light of the overall scheme of the Act, which normally requires compliance with Section 5A. When objections are lodged pursuant to those provisions, the objections must be considered, and the Government’s decision will be based on the material placed before it by the Collector. Thus, the declaration that a particular land is needed for a public purpose or for a company cannot be made arbitrarily; it must rest on the evidence and findings presented through the Collector’s proceedings, and the declaration serves as conclusive evidence that the land is indeed needed for the stated purpose.

Objections to the acquisition of land were required to be resolved by the Government after it had considered the proceedings initiated by the Collector. The Court explained that a declaration stating that a particular parcel of land was needed for a public purpose or for a company could not be issued by the Government on an arbitrary basis. Instead, the Government had to rely on the material and evidence that the Collector placed before it. Under subsection 2 of section 5A, the decision taken by the Government on those objections became final. Subsection 1 of section 6 furnished the Government with the power to form the necessary satisfaction that the land was required for a public purpose or for a company. Moreover, subsection 3 of section 6 stipulated that once the Government made such a declaration, that declaration served as conclusive evidence that the land was indeed needed for a public purpose or for a company.

Counsel for the respondents argued that the finality attached to the Government’s declaration pertained only to the fact that the land was “needed” and did not extend to determining whether the purpose for which the land was needed truly qualified as a public purpose or as a company. The Court rejected this view, holding that subsection 1 of section 6 did not create a separation between “need” and “public purpose or a company.” Introducing such a dichotomy would distort the language of the provision and defeat the purpose of the legislation. The expression “needed for a public purpose or a company” had to be read as a single, indivisible concept, and the declaration was to be understood as covering both elements jointly. Consequently, the Government was required to be satisfied about both the existence of a need and the nature of the purpose—whether it was a public purpose or a bona‑fide company—before it could issue a declaration. Once the declaration was made, subsection 3 conferred conclusive effect not merely on the Government’s satisfaction, but also on the determination that the land was needed for a public purpose or for a company. The Court emphasized that “need” could not exist in the abstract; it had to be a need directed toward a public purpose or a company. Since the Act permitted acquisition only when such a purpose existed, it would be unreasonable to limit the conclusiveness of the declaration to the mere existence of a need without regard to the character of that purpose. No acquisition could proceed under the Act unless the need fell within one of those two categories, making it futile to attach conclusiveness only to the abstract notion of need.

The Court explained that the notion of a mere “need” cannot be considered apart from the inquiry as to whether that need serves a public purpose or the purpose of a company. In view of the plain language of the relevant statutory provisions, the Court found that it could not accept the contention advanced by learned counsel. Learned counsel framed the issue slightly differently, asserting that section 6(3) presupposes the existence of a jurisdictional fact – namely, that a public purpose or a company purpose underlies the acquisition – and therefore the existence of such a purpose is a justiciable question. The Court observed, however, that the Act empowers the Government to determine whether land is needed for a public purpose or for a company, and that the jurisdiction granted to the Government to make this determination is not conditioned on any collateral or extraneous fact. It is the existence of the need for a public purpose that confers jurisdiction on the Government to issue a declaration under section 6(1), and it makes the Government the sole judge of whether a genuine need exists and whether the purpose for which that need arises qualifies as a public purpose. The provisions of sub‑section (3) therefore bar a court from ascertaining whether either of these essential elements of the declaration is present. The Court added, however, that this limitation does not imply that courts have no authority to interpret the expression “public purpose.” In support of this point, the Court referred to the Privy Council’s decision in Hamabai Framjee Petit v. Secretary of State for India (1). In that case, certain land on Malabar Hill in Bombay was being acquired by the Government of Bombay for the construction of residences for Government officers, and the lessee objected on the ground that the land was not being taken or made available to the public at large, and therefore the acquisition was not for a public purpose. When the matter came before the High Court, Batchelor, J. observed: “General definitions are, I think, rather to be avoided where the avoidance is possible, and I make no attempt to define precisely the extent of the phrase ‘public purposes’ in the lease; it is enough to say that, in my opinion, the phrase, whatever else it may mean, must include a purpose, that is, an object or aim, in which the general interest of the community, as opposed to the particular interest of individuals, is directly and vitally concerned.” The Court noted that the issue in that case concerned a re‑entry clause in a lease deed rather than the provisions of the Land Acquisition Act. The clause gave absolute discretion to the lessor, the East India Company, to decide whether possession should be resumed if the land was required for a public purpose. It was in that context that the question of whether the land was needed for a public purpose was examined. The argument before the Privy Council

The Privy Council rejected the argument that land could not be taken for a public purpose unless the land, once taken, was made available to the public at large. Instead, the Council endorsed the view expressed by Batchelor, J., observing that the remaining issue was to determine whether the purpose involved the general interest of the community. The Council held that, prima facie, the Government were competent judges of that interest, though they were not absolute judges and could not simply say “sic volo sic jebeo.” Nevertheless, a Court would not readily find the Government wrong. The Council further noted that the learned judges, who were thoroughly acquainted with the conditions of Indian life, were satisfied that the scheme would redound to public benefit by assisting the Government in maintaining the efficiency of its servants. From that conclusion, the Council said it would be slow to differ, and that the statement itself invited judicial appreciation. Counsel for the petitioner, Mr. Pathak, relied heavily on these observations and contended that the Privy Council had held the matter to be justiciable. He argued that, because the present case did not arise under the Land Acquisition Act, the satisfaction of the Government that a particular purpose fell within the concept of public purpose could not be deemed conclusive. Mr. Pathak further maintained that the meaning to be given to the phrase “public purpose” was not rendered conclusive by sub‑section (3) of section 6. According to his submission, sub‑section (3) merely declared that the Government’s declaration that a particular land was needed for a public purpose, or that a company required it, was conclusive; it did not empower the Government to define what a public purpose was and then assert that the particular purpose fit that definition. He observed that the Act made no attempt to define public purpose in a comprehensive manner, noting that the notion of public purpose varied with time and with the prevailing conditions in a locality, making a comprehensive definition impractical. Consequently, the legislature had left it to the Government to state what constituted a public purpose and to declare the need for a particular land for that purpose. Mr. Pathak also argued, relying on the Court’s decision in R. L. Arora v. State of U. P. (1962) Supp. 2 S.C.R. 149, that the Courts possessed the power to examine whether the purpose for which land was being acquired qualified as a public purpose. In that case, land was being acquired for a company, and the key question was the meaning to be attached to the words “useful to the public.”

In this case the Court examined clause (b) of sub‑section (1) of section 40 of the Act, which deals with land acquisition for a company. The land in question was needed by the company to set up its manufacturing works, and it was submitted before the Court that the products to be manufactured by the company, as reported in the 1962 Supplement to the Supreme Court Reports at page 149, would be useful to the public in general. On that basis, the petitioners claimed that the acquisition fell within the scope of clause (b) of sub‑section (1) of section 40. Justice Wanchoo, speaking for the Court, rejected that contention. He observed that while it is the Government’s responsibility to be satisfied that the work to be constructed will be useful to the public, the Government does not possess the authority to interpret the wording used in section 40(1)(b). The Court explained that it is the Court’s function to interpret those words, and only after such interpretation can the Government proceed to implement the purposes of sections 40 and 41 to its satisfaction.

The Court further held that the Government could not simultaneously define the meaning of the statutory words and then declare itself satisfied with that self‑crafted meaning. The proper meaning must be supplied by the Court, after which the Government’s satisfaction may be assessed without being open to further challenge. The Court noted that it had already indicated the meaning of the relevant words, and that if the Government claimed satisfaction based on an alternative interpretation, that satisfaction would be meaningless because the Government would not be satisfied about the matter it was required to be satisfied about. In the present matter, the Court found that the Government had adopted an erroneous view, assuming that it was sufficient that the product of the works was useful to the public and that the public could access the works for business purposes. The Court stressed that such a narrow approach did not satisfy the requirements of the wording in sections 40 and 41.

It was also argued before the Court that the declaration made by the Government under section 6(1) of the Act, which stated that the land was needed for a company, was conclusive and therefore rendered the question of the actual purpose of the acquisition non‑justiciable. The Court examined this argument and pointed out that section 6(3) renders a declaration made under section 6(1) conclusive evidence that the land is required for a public purpose or for a company. Since the declaration in this case expressly stated that the land was needed for a company and this fact was not contested by any party, the provisions of section 6(3) offered no assistance in resolving the dispute. The Court further noted that, according to the earlier decision, the conclusiveness attached to a declaration that the land is...

The Court explained that a declaration stating that land is required for a public purpose actually aids the respondents rather than the petitioners. It observed that when acquisition is sought for a company, Part VII of the Land Acquisition Act obliges the Government to be satisfied that the land is needed for one of the two purposes listed in section 40(1) before it can issue a declaration under section 6(1). The Government may give its consent to such a declaration after it has become satisfied, under section 41, that the land is necessary for a company for the purposes specified in paragraphs (a) and (b) of that same section. However, the declaration that follows is limited to a single statement: that the land is required for a company. It does not address whether the company actually needs the land for the purposes described in paragraphs (a) and (b) of section 40(1). The Court noted that the question of whether the land is truly required by the company for those statutory purposes is not relevant to the declaration itself. While recognising that the Government’s power to make a declaration in the case of an acquisition for a company is narrowly defined and must be exercised with due regard to its limitations, the Court rejected the argument that subsection 3 of section 6 makes the declaration conclusive evidence not only of the fact that the land is needed for a company but also that the land is needed for a purpose enumerated in section 40(1). Consequently, the observations of Justice Wanchoo do not provide any advantage to the petitioners.

The petitioners then relied on two earlier decisions of this Court to interpret the expression “public purpose.” The first case, Babu Barkya Thakur v. State of Bombay, held that the term “public purpose” is used in its generic sense to include any purpose that may interest even a fraction of the community or benefit it. That judgment further explained that when a large section of the community is affected, its welfare constitutes a matter of public concern. The second case, Pandit Jhandu Lal v. State of Punjab, observed that the notion of public utility mentioned in sections 40 and 41 is akin to the concept of public purpose. While these decisions broadly defined “public purpose,” neither case addressed the question of whether the meaning of the expression is justiciable. The Court therefore clarified that it is for the State Government to be satisfied that, in a particular acquisition, the purpose for which the land is required falls within the ambit of a public purpose as defined by the statute. If the purpose for which the State seeks the land lies within its legislative competence, the Government’s satisfaction on this point is decisive.

The Court observed that, save for a single exception, the declaration made by the Government under the relevant Act was deemed final. The cited authority for this proposition included the reports of the Supreme Court in 1961 at pages 126 and 459 of the Supreme Court Reports. The sole exception, according to the Court, arose when the Government’s exercise of power was merely colourable; in such a situation the declaration could be challenged by the party who was aggrieved by the purported acquisition.

The Court explained that the power conferred on the Government by the statute was a limited power. It could be exercised only in cases where the acquisition of land served a genuine public purpose. The Court set aside, for the moment, any purpose that might be claimed by a private company. If, upon examination, it appeared that the Government was satisfied that the land was needed for a private purpose, or that there was no discernible purpose at all, then the Government’s action would be characterised as colourable. In that circumstance the action would not be connected to the authority granted by the Act, and the Government’s declaration would be treated as a nullity. Apart from this narrow exception, the Court held that the Government’s declaration remained final.

The Court noted that the learned Advocate‑General had cited a number of decisions to support the view that the Government’s declaration was final. One of the leading authorities mentioned was the case of Wijeyesekera v. Festing. That case concerned the Ceylon Ordinance No. 3 of 1876 (the Acquisition of Land Ordinance, Ceylon, 1876), which incidentally did not contain a provision analogous to sub‑section (3) of section 6 of the present Act. The Privy Council, speaking through the Lordships, observed that the overall scheme of the ordinance showed that the District Court’s jurisdiction was confined to assessing compensation. The Lordships, however, refrained from stating categorically that the Governor’s decision was final merely because of the forum in which the question was raised. They concluded that the Governor’s decision that the land was required for public purposes was intended to be final and could not be questioned in any court.

The Court explained that in the Wijeyesekera case the land in question was required for the construction of a road. The petitioners argued that the Government had failed to obtain the Surveyor General’s opinion regarding the fitness of the land for that purpose, as recorded in the 1919 Atlantic Cases report (citation [1919] A.C. 646). On that basis, the petitioners sought to challenge the Governor’s declaration. The Privy Council rejected that challenge, holding that the declaration could not be questioned.

Following the Wijeyesekera decision, the Court referred to the case of Vadlapatla Suryanarayana v. The Province of Madras. In that matter a Full Bench of the Madras High Court held that a declaration made by the Provincial Government under section 6(1) of the Act, stating that certain lands were required for a public purpose, was final. The High Court further held that, provided there was no allegation that the Provincial Government had acted fraudulently or beyond its jurisdiction, the direction to acquire the land could not be contested in a court of law.

The Court listed several other decisions that endorsed the same principle. These included Samruddin Sheikh v. Sub‑Divisional Officer, V. Gopalakrishna v. The Secretary, Board of Revenue, Madras, S. Jagannadha Rao v. The State of Andhra Pradesh, and Secretary of State for India in Council v. Akbar Ali. The Court noted that a number of additional post‑Constitution judgments had also adopted the view that, subject to the exception of a colourable exercise of power, a Government declaration under the Act was final.

The learned Advocate‑General referred to additional authorities that adopt the same view expressed in the earlier decisions. No authority was placed before the Court in which it was held that, even in the absence of a colourable exercise of power, the question of what constitutes a public purpose or whether a public purpose exists may be examined by the Courts because sub‑section (3) of section 6 has become void under article 13 (2) of the Constitution. The petitioners further argued that sub‑section (3) of section 6 should not impede a proceeding under article 226 or under article 32 of the Constitution, and they relied upon the judgments in Chudalmuthu Pillai v. State, Maharaja Luchmeshwar Singh v. Chairman of the Darbhanga Municipality, Rajindra Kumar Ruia v. Government of West Bengal, and Major S. Arjan Singh v. State of Punjab. In the first of those cases the petitioners claimed that the order was motivated by mala fides and that various procedural irregularities existed; the Court observed that if a declaration is vitiated by fraud, the declaration itself is defective and cannot be protected by sub‑section (3) of section 6. The second case involved the Court of Wards handing over a ward’s lands for a nominal consideration for a public purpose; the challenge to that act was upheld by the Privy Council on the ground that the State may acquire possession only in strict compliance with the Land Acquisition Act, and the issue of whether the purpose was public did not arise for consideration. In the remaining two cases the declaration was contested under article 226, and in both instances the challenges failed – the first because no fraud was established and the second because sub‑section (3) of section 6 barred the court from questioning the validity of the declaration. Consequently, none of those authorities support the petitioners’ contention. Moreover, the present discussion concerns the jurisdiction of the High Court under article 226, not that of this Court. The petitioners nevertheless maintain that the bar created by section 6 (3) would not restrain this Court when dealing with a petition under article 32, and therefore it is open to the Court to determine whether an acquisition is for a public purpose. While it is true that the Court’s powers cannot be withdrawn by any subsequent law unless the Constitution itself is amended, the Court is presently seized of a pre‑Constitutional provision protected by article 31 (5) (a), and a challenge to its validity on the ground that it infringes the right guaranteed by article 19 (1) (f) has failed. Accordingly, the provision remains valid and the restriction it imposes on the Court’s powers under article 32 must operate. The Court is of the opinion that the judiciary is not entitled to look behind the Government’s declaration to decide whether the purpose asserted is a public purpose, but it emphasizes that the declared purpose must be relatable to a public purpose and not merely a private one; otherwise a question may arise as to whether the Government has committed fraud on its power.

In the present matter the Court was confronted with a statutory provision that pre‑dated the Constitution and that had been upheld in earlier reports, namely (1) A.I.R. 1952 Cal 573 and (2) I.L.R. 1958 Punjab 1451. The provision was protected to the extent specified in Article 31(5)(a) of the Constitution, and an attempt to challenge its validity on the ground that it violated the right guaranteed by Article 19(1)(f) had been unsuccessful. Consequently, the Court regarded the provision as a valid and operative law, and therefore the limitation it imposed on the powers of this Court under Article 32 was required to be respected. The Court expressed the view that the judiciary cannot question the Government’s declaration that a particular purpose for which land is being acquired constitutes a public purpose; however, the Court emphasized that such a declaration must be linked to a public purpose and cannot be based on a purely private purpose. If the purpose for which the acquisition is made is not connected to a public purpose, a question may arise as to whether the Government, in making the declaration, committed a fraud on the power conferred on it by the Act. In other words, the issue would be whether the declaration was merely a colourable exercise of the statutory power, and consequently, whether the aggrieved party could challenge that declaration. The protection afforded by section 6(3) of the Act would not extend to a declaration that is found to be fraudulent, because the question of whether a particular action resulted from fraud is always justiciable, notwithstanding the provisions of section 6(3). The Court noted that the learned Advocate General had drawn its attention to a recent decision of the House of Lords in Smith v. East Elloe Rural District Council, a case to which the Advocate General had referred. In that case the Lords were examining the Acquisition of Land (Authorisation of Procedure) Act, 1946 (9 and 10 Geo. VI, c. 49), Schedule 1, Part IV, paragraphs 15 and 16. Paragraph 15(1) of Part IV, Schedule 1 provides: “If any person aggrieved by a compulsory purchase desires to question the validity thereof on the ground that the authorisation of compulsory purchase thereby granted is not empowered to be granted under this Act, he may, within six weeks from the date on which notice of the confirmation or making of the order is first published, make an application to the High Court.” Paragraph 16 states: “Subject to the provisions of the last foregoing paragraph, a compulsory purchase order shall not be questioned in any legal proceedings whatsoever.” After the land had been subject to compulsory purchase, the owner instituted litigation in which, among other allegations, a declaration was made that the order had been made and confirmed wrongfully and in bad faith, and that the clerk had acted wrongfully and in bad faith in procuring the order and its confirmation. The House of Lords, by majority, held that the action could proceed only against the clerk for damages because the express prohibition in paragraph 16 barred the Court from challenging the validity of the order, and that paragraph 15 did not provide a mechanism for a person aggrieved to challenge the order on the ground of bad faith.

The Court observed that the action could proceed only against the clerk for damages, because paragraph sixteen expressly barred any challenge to the validity of the order, thereby preventing the Court from questioning the order’s lawfulness. The Court also noted that paragraph fifteen did not provide a person who felt aggrieved with any right to contest the validity of a compulsory purchase order on the ground that the order had been made or confirmed in bad faith. The Court reiterated that, as previously explained, the State Government may exercise its acquisition power only when a public purpose, or the purpose of a company, exists. If the Government were to make a declaration under section six, paragraph one, in a manner that fraudulently exceeds the powers granted by that section, the basis of the declaration would not relate to a matter that the statute requires the Government to be satisfied about; consequently, such a declaration could be challenged as having no legal effect. The Court stated that it would not follow the House of Lords to the same extent as in the earlier case. Turning to the second argument presented by the petitioners, counsel for the petitioners asserted that an acquisition cannot be justified for a public purpose unless the Government has decided to contribute to the acquisition out of public funds. According to that argument, the acquisition in the present case was intended solely for the benefit of a private company, and the Government’s action represented only a colourable exercise of the statutory power to acquire land for a public purpose. The contention further claimed that, before issuing a declaration under subsection one of section six, the Government should have resolved to make a contribution toward the acquisition. In the facts before the Court, no such decision had been taken by the Government up to 29 September 1961, which was merely one day after this writ petition had been admitted and a stay order had been issued by the Court. It was then argued that the Government’s contribution to the cost of acquisition was a very small fraction of the total estimated cost, leading to the inference that the acquisition was not even partially financed at public expense, and therefore the declaration amounted to a colourable exercise of the statutory power. Further, it was submitted that the declaration failed to specify that the State’s contribution to the acquisition cost would be only Rs 100, and also omitted to state that the Government intended to bear only a part, not the whole, of the acquisition cost. Consequently, the notification was described as misleading, creating the impression that the entire cost of acquisition would be met from the public exchequer. Finally, counsel contended that the establishment of a private industry for manufacturing refrigeration equipment could not fall within the meaning of “public purpose.” The Court acknowledged that a financial sanction for the contribution had indeed been granted, but it did not accept the argument that this alone rendered the declaration colourable.

The Finance Department had accorded a contribution of one hundred rupees toward the expenses of acquisition on 29 September 1961. It was also recorded that, one day before the sanction was granted, the petition had been admitted by the Court and a stay order had been issued. The Court observed that, although these two facts were true, they did not justify the conclusion that the Government’s declaration was a colourable exercise of its power. The provisions of subsection 1 of Article 6 did not require a notification to specify that the Government had decided to pay a portion of the acquisition expenses, nor did they obligate the notification to disclose the exact amount of any partial contribution. The petitioners further argued that any expenditure of public money for land acquisition required a prior budgetary provision and that the absence of such a provision should be relevant to the decision. The Court held that the lack of a specific budgetary line for the acquisition, whether for the whole cost or a part thereof, could not by itself invalidate the declaration. At most, an expenditure without a budgetary allocation might give the Accountant General grounds to raise an audit objection or enable the State Legislature’s Public Accounts Committee to criticize the Government’s action. However, such administrative objections did not amount to proof that the declaration was colourable. The Court also noted that, where the amount involved was as small as one hundred rupees, the Government could legitimately draw the sum from contingency reserves, thereby avoiding the said objections. Consequently, these circumstances were insufficient to establish that the declaration was a pretense.

The Advocate‑General, appearing for the State, testified that the entire plan to establish a refrigeration factory in Punjab had been examined at multiple stages, by various levels of Government and by different ministries, and that a decision had been taken to make a partial contribution from public funds toward the cost of acquisition. In accordance with the Financial Rules, the consent of the Finance Department was required for such a contribution, and obtaining that consent had taken considerable time, which explained the delay in granting the sanction. The petitioners did not challenge the Advocate‑General’s statement. Moreover, the declaration made under subsection 1 of Section 6 clearly indicated that the land was being acquired at public expense. Subsection 3 of the same article barred a Court from questioning the declaration unless it could be shown that the Government had, in fact, decided not to contribute any public revenue for the acquisition. The Court emphasized that only if such a decision existed could the exercise of acquisition power be attacked on the ground of colourability. Since no evidence demonstrated that the Government had refused to make any contribution, the declaration remained valid and was not deemed colourable.

In the present matter it was argued that the State’s contribution toward the cost of acquisition must be appreciable and cannot be merely nominal or token, as was alleged in the instant case. The argument relied on the principle that, although the law permits an acquisition for a public purpose to be effected by the State contributing only a portion of the acquisition cost, that portion must not be an insignificant particle. To support this proposition, the petitioners invoked the decision in Chatterton v. Cave (1) and its subsequent application in Ponnaia v. Secretary of State (2). In the Madras High Court decision cited, the Court observed that when the Legislature provided that a part of the compensation should be paid from public revenue, it did not intend that the condition could be satisfied by an immaterial particle such as “one anna in Rs. 5,985.” The case concerned land acquisition for a road connecting two villages in the Ramnad District, where the total amount required was Rs. 5,985, but the Government had agreed to contribute only one anna, asserting that this fulfil‑ ment satisfied the requirements of section 6 of the Act. The Government also contended that the declaration made under sub‑section (1) of section 6 could not be challenged because of the protection offered by sub‑section (3) of the same section, and it relied on the earlier judgment in Wijeyesekara v. Festing (1). The Madras High Court, however, held that a governmental share amounting to one‑ninety‑thousandth of the total cost did not constitute a genuine and bona‑fide compliance with the statutory provision, and that such a token contribution indicated an illusory purpose behind the use of the Act. The Court further referred to Chatterton’s case, noting that the House of Lords was reluctant to interpret the words “or part thereof” in the Dramatic Copyright Act so as to permit a “part” to mean a trivial particle. It also cited the decision in Maharaja Luchmemar Singh’s case, concluding that the acquisition was a colourable exercise of the power conferred by the Act. That line of authority was not followed in Senja Naicken v. Secretary of State (4), where the Court held that a State contribution of one anna out of Rs. 926‑8‑6 for acquiring land for a road, with the remaining Rs. 926‑7‑6 contributed by the cultivators, satisfied the requirements of section 6(1) of the Act. Both of these decisions were later reconsidered in Vadlapatla Suryanarayan’s case (5), where the earlier Ponnaia decision was overruled and the view expressed in Senja Naicken’s case was endorsed.

In the decision reported at page 483, with subsequent references on pages 491 and 492, the Court cited several authorities, namely the third report (3) (1890) L.R. 17 I.A. 90, the fourth report (4) (1926) 1 L.R. 60 Mad. 308, the fifth report (5) I.L.R. [1946] Mad. 153, and the sixth report (6) A. 1. R. 1926 Mad. 1099. The case identified as Chatterton’s case (1) involved an allegation of copyright infringement wherein two dramatic works had been derived from a common source by the opposing parties. The Court noted that, in that proceeding, it was uncontested that the Dramatic Copyright Act extended protection to “parts” of a dramatic work and prohibited any use of those parts by persons other than the copyright holder. By contrast, the Court observed that the ordinary copyright statute governing published works protected only the whole work and did not extend protection to individual portions of the work.

The Court further explained that the Dramatic Copyright Act contained a specific provision authorising damages of no less than forty shillings to be awarded to the proprietor in the event of infringement. It was argued before the Court that these distinctions reflected a legislative intent to safeguard dramatic works irrespective of the size or material significance of the portion of dialogue or incident that might have been copied by another. Addressing this argument, Lord Hatherley remarked that the contention went “much too far.” He quoted counsel for the respondent, who suggested that the appellant wished to interpret the word “part” in the Act as “particle,” thereby allowing even the crowing of the cook in Hamlet or the insertion of a single line of dialogue to constitute an infringement liable for statutory damages and, consequently, to justify the costs of the action under the statute of 3 & 4 William IV.

Lord Hatherley then distinguished the situation in ordinary copyright of published works, where a fair use by another party would not constitute a legal wrong warranting an action. He emphasized that dramatic performances were not intended to be reproduced in the same manner as books, yet the principle of “de minimis non curat lex” applied equally to alleged infringements involving a part of a dramatic work as it did to an excerpt from a book. He concluded that the portions taken in the present case were neither substantial nor material, and that it was impossible to demonstrate that any damage had been suffered by the plaintiff as a result of such taking; consequently, the plaintiff’s claim must fail.

Lord O’Hagan added that the term “part” should not be conflated with “particle,” observing that a taking could be so minute in extent and so trifling in nature as to escape the statutory liability imposed by the Act. The Court therefore held that the analogy drawn from Chatterton’s case could not be applied to a matter governed by the present statute. This conclusion was reached after a thorough analysis of the statutory language and the relevant case law, reaffirming that only a material and substantial portion of a dramatic work, when taken, would give rise to liability under the Dramatic Copyright Act.

In the matter known as Senja Naicken’s case (2) the Court quoted that both parties had derived their works from a common source. It observed that before a person could be ordered to pay damages for alleged theft of another’s intellectual effort, it must be shown that the resemblance between the two works is not accidental but constitutes a deliberate appropriation of the original creator’s labour and thought. The Court warned that without such proof it would be absurd to prohibit a person from using the same words, even if they appear in a different arrangement, as illustrated by the earlier authorities (1) (1878) 3 App Cas. 483, 491‑492 and (2) (1826) I.L.R. 50 Mad. The Court affirmed these observations and indicated agreement with the reasoning expressed in that earlier decision.

Turning to Maharaja Luchmeswar Singh’s case (1), the Court recounted the factual background. The plaintiff’s land had been placed under the control of the Court of Wards while he was a minor. Under section 6(1) of the Land Acquisition Act, 1870, a notification was issued that the Government intended to acquire certain lands belonging to the plaintiff for a public purpose, namely the construction of a public ghat in Darbhanga, and that the cost would be borne by the Darbhanga Municipality. Instead of following the procedures prescribed by the Act, including valuation of the land, the Collector—who also served as Chairman of the Municipality and as a representative of the Court of Wards—took possession of the land and transferred it to the municipality. The plaintiff received a compensation of Re. 1/‑, an amount that the Manager had consented to. After attaining majority, the plaintiff instituted suit for possession of the land and for mesne profits. The lower courts dismissed the suit, and the plaintiff appealed to the Judicial Committee of the Privy Council. The Privy Council allowed the appeal and observed that “the offer and acceptance of the rupee was a colourable attempt to obtain a title under the Land Acquisition Act without paying for the land.” The Court noted that this case bore no relevance to the issue under consideration in Ponnaia’s case and that it had been cited by the petitioners without any connection to the question of the State’s contribution toward acquisition costs. The cited authorities were (1) (1890) L.R. 17 I.A. 90 and (2) A.I.R. 1926 Mad. 1099. The Court then added that the principle articulated in Senja Naicken’s case (1) had been adopted by several High Courts throughout India. On the basis of that principle, State Governments have been acquiring private property nationwide by contributing only token amounts toward the acquisition cost. If the Court were to reinterpret “partly at public expense” as meaning “substantially at public expense,” the titles of many such properties would become uncertain. Accordingly, the Court affirmed the continuing application of the principle as set out in Senja Naicken’s case.

The Court observed that the policy adopted in Senja Naicken’s case (1) should remain undisturbed, but it cautioned that this should not be read to mean that a token contribution by the State toward the cost of acquisition automatically fulfills the legal requirement in every circumstance. The Court held that the adequacy of such contribution must be assessed according to the facts of each individual case. It further noted that a nominal contribution by the State could, in certain situations, suggest a colourable exercise of power. According to the Court, the expression “part” does not necessarily denote a substantial part, and the judiciary retains the authority to examine, in each matter, whether the State’s contribution satisfies the statutory mandate. In the present matter, the Court was satisfied that the contribution made by the State met the legal requirement. The next issue before the Court was whether the acquisition was effectively for a private company because the compensation was to be borne almost entirely by that company, thereby rendering the purpose private rather than public. In other words, the Court examined whether the Government’s action amounted to a colourable use of its power. The Court explained that the establishment of a factory for manufacturing refrigeration equipment constitutes an ordinary commercial venture and, by no stretch of imagination, falls within the well‑accepted meaning of “public purpose”. Even if such a venture were to be considered a public purpose, the Court observed that the factory was to be set up not by the Government nor with Government participation, but solely by respondent No. 6, a public limited company. Consequently, the company could acquire land for that purpose only after complying with the provisions of Part VII, and the reliance on the provisions of s. 6(1) was, in the Court’s view, a colourable device to enable respondent No. 6 to do something that s. 6(1) does not permit. The Court recalled its earlier definition of “public purpose” in Babu Barkaya Thakur’s case (1) (1961) 1 S.C.R. 128, describing it as a purpose beneficial to the community, while noting that the determination of whether a particular purpose is beneficial is primarily a matter for the State Government’s satisfaction. The notification issued under s. 6(1) declared that the land was being acquired for a public purpose, namely the setting up of a factory for manufacturing various ranges of refrigeration compressors and ancillary equipment. It was strongly argued before the Court that the manufacture of refrigeration equipment could not be regarded as genuinely beneficial to the community, asserting that such equipment would at most facilitate the production of luxury articles. The State Government, however, maintained that the manufacture of these articles served the community’s interest. The Court found that no material had been placed before it to show that the Government’s view was perverse or that its action based on that view constituted a fraud on its power or a colourable exercise of such power.

The Court observed that nothing in the material before it permitted an inference that the Government’s view was perverse, nor that the Government’s action amounted to a fraud on its power to acquire land or to a colourable exercise of that power. The notification itself clearly specified the purpose for which the land was being acquired, namely the establishment of a factory for manufacturing refrigeration compressors and ancillary equipment, as previously noted. The Court referred to the affidavit filed by the respondent, which set out the importance of such an undertaking to a State like Punjab that possessed a surplus of fruit, dairy products and other commodities. The affidavit explained that the proposed factory would positively affect foreign‑exchange earnings, promote education, and relieve unemployment pressure. Since none of the affidavits had been contested, the Court expressed no hesitation in relying upon them. On the face of the evidence, the Court held that creating a factory of this nature served a purpose beneficial to the public even though the enterprise was privately owned. The Court further noted that modern refrigeration facilities are treated as public utilities, and consequently a factory producing essential equipment for such utilities must be regarded as carrying out a public purpose. Citing established practice in the United States of America, the Court pointed out that eminent‑domain power may be exercised to establish public utilities, and therefore it may also be exercised to set up a factory that manufactures equipment on which a public utility depends. Accordingly, the Court concluded that, apart from the provisions of sub‑section (3) of section 6, the notification issued under section 6 could not be successfully challenged on the ground that the acquisition did not pursue a public purpose. The Court therefore rejected the petitioner’s contention that the Government’s notification under sub‑section (1) of section 6 represented a colourable exercise of the statutory power.

The Court then turned to the petitioners’ allegation of discrimination. The petitioners claimed that, because they intended to establish a paper‑manufacturing factory—a venture also useful to the community—they were an industrial concern comparable to respondent No. 6, and that the State’s decision to acquire land from them and allocate it to respondent No. 6 amounted to discrimination. The Court noted that the respondents denied that the petitioners were in the process of setting up a paper factory. It was accepted that a new factory could not be established without first obtaining a licence from the appropriate authority under the Industries Development and Regulation Act, 1951, and that the petitioners did not possess such a licence. Although the petitioners asserted that they had entered into an agreement with a firm for establishing the paper factory, the Court found that no licence had been obtained and therefore the alleged venture could not be treated as a comparable industrial undertaking for the purposes of the acquisition.

The petitioners contended that they had entered into an agreement with the firm of Messrs. R. S. Madhoram & Sons for the purpose of establishing a paper factory, and that in collaboration with that firm they intended to set up the factory on the land which was then being acquired. It was acknowledged that a licence for erecting a paper factory had indeed been granted to Messrs. R. S. Madhoram & Sons; however, the licence expressly stipulated that the factory was to be situated in Uttar Pradesh and not in the State of Punjab. Consequently, without obtaining the approval of the appropriate authority, the location of the factory could not be transferred to the land in question, which, as already noted, lay within the territory of Punjab. In addition, the licence had subsequently been cancelled on the ground that Messrs. R. S. Madhoram & Sons had taken no steps toward actually establishing the paper factory. The petitioners alleged that the cancellation had been procured by the respondents with the intention of obstructing the petitioners’ own plans. The Court, however, held that it need not entertain that allegation because, as the licence stood on the date of the petitions, it did riot entitle Messrs. R. S. Madhoram & Sons to establish a factory in the State of Punjab. Beyond this specific question, the Court observed that the State is always free to set priorities among various public utilities, taking into account the needs of the State, existing facilities, and other relevant factors. In Punjab, for example, there is a substantial surplus of fruit and dairy products that require preservation, and a number of cold‑storage facilities already exist in the State. Accordingly, the Government would be acting reasonably in giving priority to a factory that manufactures refrigeration equipment, which could be used to upgrade existing cold storages and equip new ones. Moreover, it is within the State Government’s discretion to determine which particular industry may be regarded as beneficial to the public and to decide that its establishment serves a public purpose. Therefore, no question of discrimination arises merely because the Government has declared that the establishment of a particular industry constitutes a public purpose. Accordingly, the Court concluded that the challenge to the notification on the basis of Article 14 of the Constitution must fail. The petitioners also made a final contention that the notifications issued under sections 4 and 6 of the Act could not be made simultaneously and that, because both notifications were published in the Gazette on the same date—August 25, 1961—the statutory provisions had not been complied with. They argued that the Act deprives a person of his inherent right to hold and enjoy property, and therefore the State’s exercise of statutory power to acquire such property for a public purpose, even with compensation, must be subject to meticulous observance of every legal requirement governing acquisition.

It was observed that, according to the first sub‑section, a particular piece of land may be described as “likely to be needed for a public purpose.” Subsequently, under section 5A, any person who has an interest in that land acquires the right to object to the proposed acquisition, and the entire matter must be finally considered and decided by the Government after hearing the objecting person. Only after that hearing, in a normal situation, may the Government issue a notification under sub‑section (1) of section 6, declaring that it is satisfied, “after considering the report, if any, made under section 5A, sub‑section (2),” that the land is required for a public purpose. This order of steps constitutes the required sequence for making the notifications.

The rationale for adhering to this sequence is to demonstrate that the Government has carefully examined all relevant facts before arriving at a decision or reaching satisfaction, even in cases where the provisions of section 5A do not have to be complied with. Undisputedly, the law mandates that a notification under sub‑section (1) of section 6 may be issued only after the Government is satisfied that the specific land is needed for a public purpose. Likewise, if the Government has not, under sub‑section (4) of section 17, directed that the requirements of section 5A be waived, then the two notifications—those under sub‑section (1) of section 4 and under sub‑section (1) of section 6—cannot be issued simultaneously.

However, the Court held that when an emergency exists such that the State Government, invoking sub‑section (4) of section 17 of the Act, directs that the provisions of section 5A need not be complied with, the fundamental issue—whether the land is genuinely required for a public purpose—must already have been examined at the earliest stage, namely at the moment it is decided to dispense with the requirements of section 5A. Consequently, the Court found no reason why, in such an emergency, the two notifications could not be issued at the same time. A notification under sub‑section (1) of section 4 is a condition precedent to the issuance of a notification under sub‑section (1) of section 6. If the Government first decides to make the initial notification and then subsequently decides both to waive compliance with section 5A and to declare that the land covered by the notification is indeed required for a public purpose, there is no violation of any statutory provision, even though both notifications are published on the same day.

In the case presently before the Court, the preliminary declaration under section 4(1) was made on 18 August 1961, and the subsequent declaration confirming the Government’s satisfaction was made on 19 August 1961, although both were published in the Gazette dated 25 August 1961. The law requires that both the preliminary declaration and the subsequent declaration be published in the official Gazette.

The Court observed that the requirement to publish a notification in the official Gazette does not, under the statute, impose a condition that a notification issued pursuant to sub‑section (1) of section 4 must be published before a notification issued under sub‑section (1) of section 6. In cases where the acquisition follows the ordinary procedural sequence, the notification required by section 6 will inevitably appear after the notification required by section 4 because the procedural steps mandated by section 5A intervene between the two publications. However, the Court noted that when section 5A is not applicable, there is no statutory defect in publishing both notifications on the same day. The Gazette entries in question bore the serial numbers No. 5809/41 B(1)/61/18755 dated 18 August 1961 and No. 5809‑4 IB(1)/61/18760 dated 19 August 1961, and the numbering indicated that the preliminary notification indeed preceded the final declaration. The Court recorded that these were the sole objections presented before it and, having found each objection unsubstantiated, ordered that the petitions be dismissed with costs. Since all petitions had been heard together, the Court further directed that only a single hearing fee would be payable.

Justice Subba Rao, after reviewing the judgment drafted by his colleague Justice Mudholkar, respectfully expressed disagreement. He stated that the material facts had already been fully set out by his colleague and need not be repeated except where they were directly relevant to the specific issue he intended to address. Justice Subba Rao recounted that the petitioners had purchased approximately six acres of land in the village of Meola Maharajpur, Tehsil Balabhgarh, District Gargaon, paying Rs 4,60,000 for the purchase in February 1961, as reflected in Writ Petition No. 246 of 1961. He explained that on 25 August 1961 the Governor of Punjab issued a notification, dated 18 August 1961 and published in the Official Gazette under section 4 of the Land Acquisition Act, 1894, indicating that the land was likely to be required by the Government for public purposes, specifically for establishing a factory to manufacture a range of refrigeration compressors and related equipment. Pursuant to section 17 of the Act, the appropriate Government directed that the provisions of section 5A would not apply to this acquisition. On the same day, a second notification dated 19 August 1961 was published under section 6, stating that the Governor of Punjab was satisfied that the land described was indeed required for the public‑purpose project. He further noted that on 29 September 1961 the Government of Punjab sanctioned an expenditure of Rs 100 to facilitate the acquisition of the land. While the validity of the notifications was challenged on various grounds, Justice Subba Rao clarified that, siding with the petitioners on the interpretation of the proviso to section 6, he would not express an opinion on any other issues raised in the case. He concluded by quoting the operative portion of section 6(1) of the Act, which provides that “Subject to the provisions of Part VII of this Act, when the appropriate Government is satisfied, after considering the report, if …”.

In the provision under section 5A, sub‑section (2), the law requires that when a government is satisfied that a particular parcel of land is needed either for a public purpose or for a company, a formal declaration must be issued under the signature of the Secretary to the government or of an officer duly authorised to certify the order. However, the provision contains a proviso that imposes a condition on the issuance of such a declaration. The condition states that no declaration may be made unless the compensation for the land is to be paid either by the company that will acquire the land or, wholly or partly, out of public revenues or from a fund that is controlled or managed by a local authority. Accordingly, the Government may announce that a specific land is required for a public purpose or for a company, but the declaration can be issued only if the compensation for that land will be funded in the manner described in the proviso. The requirement is that the compensation must be paid by the company when the acquisition is for a company, or, in the case of an acquisition for a public purpose, the compensation must be borne either entirely or at least substantially by public funds. The purpose of this provision is plainly to provide a safeguard against the misuse of acquisition power. A substantial contribution from the public treasury ordinarily serves as a guarantee that the acquisition truly serves a public purpose. Some arguments, however, suggest that the statutory terms would be satisfied even if the government contributed only a nominal amount—sometimes described figuratively as a “pie”—while the total compensation might be many lakhs. Such an interpretation would produce absurd results. For example, the Government could acquire the land of a person named A for the benefit of B under a declared public purpose, and contribute only a trivial amount toward an estimated compensation of, say, one lakh rupees. If the legislature had intended such a token contribution to fulfil the statutory condition, it would not have imposed a requirement that part of the compensation be paid, because that provision would then fail to achieve its intended protective purpose. Therefore, a reasonable construction must be given to the phrase “wholly or partly”. The proviso indicates that the compensation shall be paid either by the company or, wholly or partly, out of public revenues. The contrast between these two modes of payment signals that in one situation the entire compensation must come from the company’s resources, while in the other situation a whole or a reasonable portion of the compensation must be provided from public funds. This interpretation rejects the notion that the public contribution could be negligible. The juxtaposition of the words “wholly or partly” and the disjunctive phrasing reinforce the same concept. It would be incongruous to claim that public revenue would contribute either the full amount of one lakh rupees or merely a symbolic “pie”. The payment of a part of the compensation must therefore have a rational relationship to the total compensation payable, and the part contributed by the government must be substantial rather than illusory.

In interpreting the phrase “part” within the provision that compensation may be paid wholly or partly out of public revenues, the Court explained that “part” must be understood to mean a substantial portion of the compensation that is estimated for the acquisition of land for a public purpose. The Court noted that the term does not admit an exhaustive definition, because what constitutes a substantial part varies with the facts of each case, the amount of compensation assessed, and other relevant circumstances. While a court will not engage in a minute balancing exercise between a part and the whole, it is required to determine, in a broad sense, whether the government’s contribution in a particular case is so insignificant that it cannot reasonably be described as a substantial part of the consideration. The Court acknowledged that there exists some divergent authority on this point. It referred to the House of Lords decision in Chatterton v. Cave (1878) 3 App.Cas. 483, 498, where the statutory language involved “production or any part thereof.” In that case the plaintiffs owned a drama titled “The Wandering Jew,” and the defendant’s work was found to copy only two scenes. Lord O’Hagan observed that “part” is not identical to “particle” and that a taking so minute and trifling in nature would not attract statutory liability. Although that decision concerned a different statute, the Court held that the construction of “part” as a real, substantial part is of general application and reflects the legislature’s intention that the words “any part” denote a meaningful portion.

The Court then examined Indian authorities on the same issue. It cited a division bench of the Madras High Court, comprising Spencer and Ramesam JJ., in Ponnaia v. Secretary of State (A.I.R. 1426 Mad. 1099). In that case the total compensation required for the acquisition of the appellant’s property was Rs 5,985, while the government contributed merely one anna from provincial revenues. The learned judges held that such a negligible contribution revealed the illusory character of the provision’s purpose. Referring to the argument that any small governmental contribution would satisfy section 6 of the Act, Justice Ramesam, at page 1100, observed that the legislature, when enacting the Land Acquisition Act, did not intend to allow private persons to deprive owners of their property through a mere device for private ends, spite, or malice. The Court emphasized that these observations, made by a judge of considerable experience who had also served as Government Pleader before his elevation, underscore the statutory object of requiring a substantial public‑revenue contribution, thereby limiting the potential abuse of power under the Act.

The Court noted that the earlier observation, made by a judge who later served on the Madras High Court, highlighted the statutory purpose of requiring a substantial contribution from public revenues, reasoning that a strict insistence on such a contribution would largely prevent abuse of power under the Act. However, the Court observed that another division bench of the same High Court, comprising judges Odgers and Madhavan Nair, had not accepted that earlier decision in the case of Senja Naicken v. Secretary State for India (1). After a careful review of the judgment in that case, the Court expressed great respect for the learned judges but found no satisfactory reason to depart from the earlier view of the same court. Judge Odgers focused his criticism mainly on the earlier bench’s reliance on a decision of the House of Lords rather than on the intrinsic merits of the earlier decision itself. While it was true that the earlier judges had cited the observations of the House of Lords, they did so only to support the conclusion that the expression “part” should not be interpreted as “particle”. Their principal reason, the Court recorded, was that, considering the object of the proviso, the Legislature could have intended the word “part” to denote a substantial portion; otherwise the purpose of the provision would be defeated and the very abuse of power that the legislation sought to prevent could be perpetrated under the guise of the Act.

The Court further explained that Judge Odgers gave a second reason at page 314, inviting the learned advocate for the appellant to indicate where the word “particle” would end and “part” would begin in the sum of Rs 600. The Court acknowledged that an anna represented a very small part of Rs 600, yet it remained a part. By adhering strictly to the literal wording and disregarding the spirit of the section, the Court held, the purpose of the legislation was inevitably frustrated. The Court emphasized that the term “partly” in the proviso must be construed in the context in which it appears, not in isolation as the learned judge had attempted. A third reason advanced by Judge Odgers, cited at page 315, suggested that if compensation were enhanced on appeal, the Government would inevitably have to meet the additional amount from public revenues and, having once undertaken the acquisition, could not again call upon the constituents. The Court considered this observation misplaced, stating that the Government was not required to fix a precise figure. Instead, the Government could agree to bear a definite proportion of whatever compensation might ultimately be awarded, and any subsequent variation by tribunals would not create difficulty because the agreed proportion would adjust with the varying amounts. Moreover, the Court observed that the contribution need not be a specific fraction of the final compensation awarded.

In the matter before the Court, it was observed that the Government must agree to contribute a substantial portion of the estimated compensation in order to satisfy the requirement imposed by the statutory section. The other learned judge, Madhavan Nair, J., essentially concurred with the judgment of Odgers, J., and offered no additional reasons that would distinguish his view from that of the earlier bench. The Court expressed the view that the decision reported in Senja Naicken v. Secretary of State (1) was erroneous. That decision, together with another, had been examined by a full bench of the Madras High Court in Suryanarayana v. Province of Madras (2). In that hearing, Sir Lionel Leach, C.J., delivering the judgment of the full bench, referred to the division‑bench judgment in Ponnaia v. Secretary of State (3) and noted the criticism that had been levelled against the later division‑bench decision in Senja Naicken v. Secretary of State (1). He stated, “We are in entire agreement with this criticism.” The learned chief justice then observed that, for the purpose of interpreting the proviso, only the words used could be considered, and that it was sufficient to comply with the proviso if any part of the compensation was paid out of public funds. He explained that even a very small amount, such as one anna, constituted a part of the compensation, and although it was a minor part, it was nevertheless a part. The Court held that this literal construction of the word “part,” divorced from the context in which the word appears in the section, rendered the condition attached to the Government’s exercise of jurisdiction ineffective and gave the Legislature an intention to impose a futile formality. The Court cited the authorities (1) (1926) I.L.R. 50 Mad. 308, (2) I.L.R. (1946) Mad. 153,158, and (3) A.I.R. 1926 Mad. 1099 in support of this conclusion and declared that, for the reasons already set out, the earlier judgment could not be sustained.

The Court therefore held that unless the Government agrees to contribute a substantial portion of the compensation, taking into account the circumstances of each case, the condition imposed by the proviso on the appropriate Government’s jurisdiction is not fulfilled. In the present case, it was held that a contribution of Rs 100 out of an estimated compensation that could exceed Rs 4,00,000 could not be characterized as a substantial part of that compensation. Consequently, the Government had breached the condition and, as a result, possessed no jurisdiction to issue a declaration under section 6 of the Act. The Court stated that there was no need to express an opinion on the remaining issues raised in the case. Accordingly, the notification in question was quashed, and respondents 1 to 5 were prohibited from giving effect to that notification or instituting any proceedings under it. The Court also noted that the order made in Writ Petition No. 246 of 1961 would govern Writ Petitions Nos. 247 and 248 of 1961, and that similar orders would be issued in those petitions. Finally, the respondents were ordered to pay the costs of the petitioners in all the petitions. In view of the majority opinion, the writ petitions were dismissed with costs.

After hearing the matters fully, the Court reached the conclusion that the writ petitions that had been presented before it must be dismissed. In its order the Court specified that the dismissal would be accompanied by an award of costs, meaning that the party incurring the expense of the proceedings would be entitled to recover those costs. The Court additionally directed that only one set of hearing fees should be payable in respect of the entire hearing, thereby limiting the fee liability to a single charge rather than multiple assessments. By affirming the dismissal and the associated financial directions, the Court completed its disposition of the petitions, confirming that the writ petitions were dismissed and that the cost and fee orders would apply as stated.