GIRDHARILAL AMRATLAL SHODAN Vs. STATE OF GUJARAT

JUDGEMENT

(1.) On August 3, 1960, the Government of Gujarat issued a notification under S. 4 of the Land Acquisition Act, 1894 (hereinafter referred to as the Act) stating that the land measuring about 7,151 sq. yards in Final Plot No. 460 of the Town Planning Scheme No. III of Elis bridge in Ahmedabad taluka city, village Changispur, was likely to be needed for a public purpose, viz., for construction of houses for Shri Krishnakunj Government Servants Co-operative Housing Society, Ltd., Ahmedabad. The land is the subject-matter of a trust of which appellant No. 1 is the trustee and appellants Nos. 2 to 6 are the beneficiaries. An enquiry under S. 5-A of the Act was duly held, and a report under Section 5-A (2) was made to the Government. On July 16, 1961, the State Government issued a notification under S. 6 of the Act stating that the land was needed to be acquired for the aforesaid public purpose at the expense of Shri Krishnakunj Government Servants Co-operative Housing Society Ltd. On September 22, 1961, the appellants filed a writ application in the High Court of Gujarat praying for an order quashing the notification under S. 6, dated July 18, 1961. During the pendency of this application, the Government issued a notification, dated April 28, 1964 cancelling the aforesaid notification, dated July 18, 1961. On August 14, 1964, the Government issued a fresh notification under S. 6 stating that the land was needed to be acquired at the public expense for a public purpose, viz., for the housing scheme undertaken by Shri. Krishnakunj Government Servants Co-operative Housing Society, Ltd., Ahmedabad with the sanction of the Government. The appellants were thereupon allowed to amend the writ petition, and by the amended writ petition, they prayed for an order quashing the notification under S. 6, dated August 14, 1964 as also the notification under S. 4, dated August 3, 1960. On April 2, 1965, the High Court dismissed the application. The appellant now appeal to this Court on a certificate granted by the High Court.

(2.) Counsel for the appellants submitted that the power of the State Government to cancel a notification under S. 6 of the Act implied by S. 21of the General Clauses Act, 1897 is subject to the condition that the Government should withdraw from the acquisition as provided for in S. 48 of the Act, by cancelling the notification under S. 6 dated July 18, 1961 the Government must be taken to have withdrawn from the acquisition and cancelled the notification under S. 4, dated August 3, 1960 also and consequently the Government could not issue the notification under S. 6, dated August 14, 1964 without issuing a fresh notification under S. 4 and making a fresh enquiry under S. 5A Counsel for the respondents disputed the correctness of this submission.

(3.) It is to be noticed that the notification under S. 6, dated July 18, 1961 stated that the land was required for a public purpose at the expense of Shri Krishnakunj Government Servants. Co-operative Housing Society Ltd. The Government had no power to issue this notification. Having regard to the proviso to S. 6 of the Act, a declaration for acquisition of the land for a public purpose could only be made if the compensation to be awarded for it was to be paid wholly or partly out of public revenues or some fund controlled or managed by a local authority. The Government had no power to issue a notification for acquisition for a public purpose where the compensation was to be paid entirely by a company. The notification dated July 18, 1961 was, therefore, invalid and of no effect, see Shyam Behari vs. State of Madhya Pradesh AIR 1965 SC 427. The appellants filed the writ petition challenging the aforesaid notification on this ground. The challenge was justified and the notification was liable to be quashed by the Court. The State Government realised that the notification was invalid, and without waiting for an order of Court, cancelled the notification on April 28, 1964. The cancellation was in recognition of the invalidity of the notification. The Government had no intention of withdrawing from the acquisition. Soon after the cancellation the Government issued a fresh notification under S. 6. Where, as in this case, the notification under S. 6 is incompetent and invalid, the Government may treat it as ineffective and issue a fresh notification under S. 6. This is what, in substance, the Government did in this case. The cancellation on April 28, 1964 was no more than a recognition of the invalidity of the earlier notification. There is nothing in S. 48, which precluded the Government from treating the earlier invalid notification as ineffective and issuing in its place an effective notification under S. 6. Where the notification under S. 6 is lawful and valid, a question may well arise whether the Government can cancel it without withdrawing from the acquisition as provided for under S. 48. But no such question arises in this case, and we express no opinion on it.