THE STATE OF MADRAS, REPRESENTED BY THE COLLECTOR OF CHINGLEPUT DISTRICT Vs. W.V.A. GOVINDARAJA CHETTIAR

JUDGEMENT

(1.) THE point that arises in this appeal is a very simple one. It is whether the State of Madras, acting through its officers, agreed to purchase certain pieces of machinery from the respondent and whether any such agreement operates as a binding contract. The contention of the State of Madras, which is the appellant, before the Court below was that whatever might have been the position during the earlier stages of the negotiation, there was no concluded contract for the purchase and that the claim made by the respondent plaintiff to recover any sum as the value of the machinery is not maintainable. The following facts are necessary to clarify the stand taken by either party.

(2.) THE respondent was the owner of an extent of over 17 acres of land which he was running as a farm. He had fitted up an oil engine, electric motors, pump lines and masonry channels to carry on water as part of the equipment of the farm. It is not in dispute that originally the property was taken on lease by the Government for a period of six months on 21st August, 1957, the lease to be effective from 1st October, 1957 to 31st March, 1958. Even during the currency of the lease, proceedings were started under the Madras Requisitioning and Acquisition of Immovable Property Act, (Madras Act XLII of 1956), and a notice under Section 3(1) of the Act was issued on 5th January, 1958 by the Collector of Chingleput District. This notice stated that, as in the opinion of the competent authority, the property was needed for a public purpose, viz., for the establishment of a State Seed Farm, it was proposed)to requisition the property under the provisions of that Act and the owner, the respondent, was called upon to show cause why such requisition should not be made. The notice also prevented the owner to dispose of or structurally alter the said property or let it out to a tenant for a period of two months from the date of the notice. From the evidence on record, it transpires that the move for the requisition of the property proceeded from the Department of Agriculture, though certain relevant documents in the chain have not been produced. In pursuance of this notice, the Special Tahsildar, presumably acting under the directions of the Collector, recorded a statement from the respondent. The respondent expressed himself as agreeable to the proposal. In this statement, it was pointed out that the lands together with the wells, pumpset and brick -built buildings thereon had been in the possession of the Department from 1st October, 1957, and it further stated, "the wells, pumpsets and the buildings situate on the lands to be acquired by the Government belong to me alone". A detailed description of the property together with the value set upon it by the owner finds place in this statement, Exhibit B -2, and the owner valued the entire property, including the irrigation facilities thereon, which consisted of the wells, electric machine, oil engine, etc., at Rs. 30,000 and the statement' ended by saying that the owner agreed to give over the entire property, inclusive of these machinery to the Government. In due course, this was followed by an order under Sections 3(2) and 4 of the Act, requisitioning the property and directing surrender and delivery of possession thereof. The latter part of this order is "obviously a formality, for the Department of Agriculture was on that date in possession of the property by virtue of the lease that had been entered into.

(3.) ON the same day as. the order of requisition, the competent authority proceeded to take proceedings to acquire the property under Section 7 of the Act. It is clear from the proceedings that the acquisition of the property must have been in the minds of the appropriate authorities from the beginning, but they purported to follow a somewhat devious course, firstly, by taking on lease and thereafter proceeding to apply the Madras Requisitioning and Acquisition of Immovable Property Act, rather than the Land Acquisition Act. Whatever that may be, the acquisition was not objected to and for the purpose of working out the compensation payable the parties entered into an agreement. This agreement is Exhibit B -6. It is common ground that originally it was intended to value the pumpsets, etc., for the purpose of computing the compensation, but in the final agreement that was reached with regard to the compensation, those items were left out, while this feature is depended upon by the appellant as indicating that there was no intention at all to acquire these pieces of machinery, on behalf of the respondent it is pointed out that there was in fact a valuation of these pieces of machinery independently of the valuation of the land, permanent structures thereon, the wells and the trees, and the reason why the pieces of machinery were left out was the view taken by the Collector that they did not form part of the immovable property, which alone could be acquired under the relevant Act, a view which seems to us to be entirely erroneous. But we shall deal with that later. The respondent was paid a compensation of Rs. 29,000 and odd which included the value of the lands, trees, wells, buildings, sheds, etc., and which admittedly excluded the value of the machinery constituting the pumping installation. The compensation was paid in pursuance of Exhibit B -7, the proceedings of the Collector of Chingleput, dated 31st March, 1958, and right from that date, the Department continued to be in possession of the entire premises including the pumping installation.