Sulaiman vs State on 22 February, 2011

[Cites 37, Cited by 0]

Gujarat High Court

Sulaiman vs State on 22 February, 2011

1. The petitioner has, through his son holding his power-of-attorney, invoked Articles 226 and 300-A of the Constitution to challenge as illegal the land acquisition proceedings initiated by the State for respondent No.3 Company (for short, the Company ). He owns and holds lands bearing survey No.26/2(part) and No.29/2(Part), totally admeasuring 2 hectares 4 Are and 6 sq. mtrs, which are included in the proceedings for acquisition of total 9-62-45 hectares of land at village Motikhavdi, district Jamnagar.

2. It is the case of the petitioner in the petition that, earlier by notification dated 09.04.2002, another part of the same land was acquired for the same purpose of extension of housing colony of the Company. That acquisition was challenged by the petitioner in SCA No.514 of 2003 which was rejected by this Court by order dated 23.08.2005. It is averred that that acquisition was also illegal and in excess of the requirement of the Company. Now, notification dated 05.03.2010 under section 4 of the Land Acquisition Act, 1894 (for short, the Act ) is published in the Official Gazette and notice dated 15.03.2010 was issued calling upon the petitioner to file objections, if any, under section 5-A of the Act. He filed his objections on 19.04.2010. The petitioner has made vague averments, serious allegations and innuendos against the management of the Company and their relations with higher officers and politicians, without any specific statement of facts and without joining any person as respondent in his individual capacity. The general refrain of the petition is that the Company already possesses large areas of land, does not need additional land and the government is supporting the Company in acquiring large tracts of land for enriching their estate for luxurious living of its officers at the cost of the petitioner. It is alleged that the Company has misused the already acquired lands by utilizing it for thousands of acres of mango plantation and making luxurious buildings for VIPs and guests and to provide golf course, tennis courts, stadium, playground and five-star buildings. It is contended that the petitioner sought information that called for proper enquiry but his objections were not duly considered; and due to anomalies and lapses in the proceeding, the statutory notifications and the acquisition proceedings violated the provisions of sections 4, 5, 6, 39, 40 and 41 of the Act as also Articles 14 , 19 , 31 and 300-A of the Constitution.

3. In the affidavit-in-reply filed on behalf of respondent No.2, the Deputy Collector, Jamnagar has deposed that he has gone through all the relevant records pertaining to the petition and its annexures and placed true facts before the Court. He has stated that the petitioner has presented an absolutely incorrect and deliberately misleading factual picture before the Court, while the acquisition is not only in conformity with the provisions of the Act but also in the national interest, considering the security threat perspective in a refinery. The Company initially established a refinery with capacity of 9 million metric tones per annum (MMTPA) which is increased thereafter to 27 MMTPA. Considering the fact that any refinery anywhere in the country has a huge security threat potential in view of the recent terrorist activities, the refineries are required to have adjoining housing colony even as the security of both the refinery as well as the housing colony is the responsibility of the Central Industrial Security Force (CISF). When the production capacity was 9 MMTPA, land acquisition proceedings were initiated for acquisition of land for building a housing colony adjacent to the refinery unit. When the production capacity of the Company was increased from 9 MMTPA to 27 MMTPA and thereafter to 33 MMTPA, the Company required more land for expansion of its housing colony and requested the Government to allot government waste land. After allotment of government waste land on payment of price, the question of acquisition of pocket land arose. The State Government has formed an opinion that destruction/obstruction of, or interference with the refinery premises and its housing colony would be useful to the enemies and, therefore, it has issued notification dated 20.10.2010 in exercise of powers conferred under section 2 (8) (d) of the Indian Official Secrets Act, 1923 read with Government of India notification, Ministry of Home Affairs dated 04.05.1963 declaring the lands mentioned therein to be prohibited place for the purpose of the Act. Considering the geographical position of the land in question, which is a pocket land, and considering the boundary of the Company's housing colony, the owners/occupants of the pocket land cannot be given an access to their respective lands in violation of the prohibitory notification.

3.1 It is also averred by the Deputy Collector that there is no mango farm or any other farm in the area comprised in the Company's colony. The refinery portion of the Company is required to earmark separate area for tree plantation to conform with the environment policy and environment laws. Such land could not be permitted to be used for any other purpose and such tree plantation is in the refinery portion of the Company with no geographical or other connection with the lands acquired or being acquired for the purpose of the housing colony of the Company. Considering the substantial increase in the production capacity of the Company, the strength of its personnel has also significantly increased and they have to be housed in the vicinity in view of the sensitive nature of industry in question and the terrorist threat perspective. It is stated that all the relevant materials, i.e. copy of the detailed report under section 40 of the Act read with Rule 4, along with site-plan of the land and Agricultural Officer's report were provided to the petitioner by letter dated 04.05.2010. The report under section 40 of the Act provides details with regard to:-

(i) purpose for which the land was being acquired;

(ii) the company having made full and reasonable efforts to obtain the land from land owners;

(iii) the company having made offer of reasonable price of the land;

(iv) land to be acquired being appropriate for the purpose;

(v) land demanded by the Company being in accordance with the actual requirement, and

(vi) whether any alternate land is available, etc. It is stated that even now many employees are not accommodated and they are staying elsewhere. The contentions contained and the allegations made in the petition are generally and specifically denied on oath by the Deputy Collector and he has relied upon observations of the Apex Court in State of Punjab vs. Gurdial Singh [AIR 1980 SC 319] and in Ramgir Goswami v. State of Gujarat [(1988) 1 SCC 466].

4. Vice President (Legal) of the Company has also filed an affidavit-in-reply to, inter alia, state that the purpose of extension of residential colony of the employees of the Company amounted to a public purpose under section 4 of the Act; that the Government has sole and absolute discretion in the matter of deciding 'public purpose' and the lands in question were required to be acquired in order to ensure efficiency of its employees and increase productivity of the Company; and publication of declaration under section 6 of the Act is conclusive evidence of public purpose. It is stated that Industries Commissioner, Government of Gujarat, has clearly stated in letter dated 31.03.2003 that the proposal of the Company to acquire 128.58 hectares of land was considered to be reasonable, which implied that the lands acquired earlier were appropriately utilized. It is stated that the land of the petitioner is a pocket land surrounded by the land possessed by the Company. If it is not acquired, it would raise certain security concerns for the Company and declaration of the land in question as a 'prohibited place' reflects significance of the location of the land. It is further averred that in the relevant Land Acquisition Case No.1 of 2010, the Company has requested for acquisition of lands of survey No.25/P(2)/P(1) admeasuring 1-20-00 H-A-Sq.m.; 26/P(2) admeasuering 0-04-06 H-A-Sq.m.; 29/P(2) admeasuring 2-0-H-A; 228 admeasuring 2-60-01 H-A-Sq.m. and 229 admeasuring 2-78-38 H-A-Aq.m of village Motikhavdi. The total land under acquisition is admeasuring 09-62-45 H-A-Sq.m. held by four land owners, out of whom three have given their land with their consent under section 11 (2) of the Act and two consent awards have been declared on 15.10.2010 and 20.11.2010. This deponent has also generally and specifically denied the allegations of the petitioner. It is further stated that the Ministry of Environment and Forests, Government of India, has, vide office order dated 15.09.1995, stated that environmental clearance has been granted to the Company for the refinery complex at Jamnager subject to certain conditions, including that a green-belt plan with adequate density all around the refinery has to be developed and the norm of about 1500-2000 plants per hectare may be adopted. That plantation has been developed by the Company around the petroleum refinery in accordance with the said order dated 15.9.1995. The Company employs thousands of employees/officers for carrying on its manufacturing activities which also earn valuable and sizeable foreign exchange for the country and construction of residential colony for providing decent accommodation to its employees could be said to be a valid purpose under the Act. It is denied that the satisfaction arrived at by the State Government for acquiring the land is arbitrary, illegal, without application of mind or mala fide or in violation of sections 40 and 41 of the Act, as alleged. It is denied that the lands acquired under 2001 acquisition are yet not fully utilized. It is stated that there is a phase-wise planned expansion of the housing colony and the land acquired will be utilized completely and solely for the purpose for which it is acquired. It is further stated that walls have been constructed around the land possessed by the Company apparently in view of the security concerns. The existing compound wall covers only a part of the housing colony and the compound wall cannot be constructed due to the pocket land which creates security concerns for the Company.

4.1 The following statement made on oath on behalf of the Company needs to be quoted verbatim:

It is pertinent to note that the respondent Company has also requested respondent No.2 to grant the government waste land admeasuring 130-60-36 (H-A-Sqm.). On the basis of company's application, the Chief Industrial Advisor from the office of the Industries Commissioner, Government of Gujarat, Gandhinagar visited the site, verified the earlier construction of the residential township/colony and thereafter checking and verifying the records of the company in connection with the construction of the residential accommodation, connecting allied facility and land use pattern as per various rules and regulations of Urban Development Authority, Town Planning Office, Urban Development Regulations etc. Subsequently he had recommended to the Government of Gujarat to grant the government waste land admeasuring 128-58-00 (H-A-Sqm.) of government waste land for the development/extension of housing colony. This itself shows that the petitioner had made a vague allegation that land has not been utilized and it has been utilized by the company for the mango plantation in the housing colony/township.

5. By filing an affidavit-in-rejoinder, the petitioner has, inter alia, stated that the impugned notification did not speak about the alleged threat and terrorist activity and the facts pleaded by the respondent were extraneous, irrelevant and an after-thought only with a view to support the acquisition which is not warranted. It is contended that notification dated 25.11.2010 under the provisions of the Indian Official Secrets Act, 1923 is ultra vires and violative of Articles 14 , 19 , 31-A and 300-A of the Constitution. A major part of the rejoinder is devoted to other contentions and arguments rather than any statement of fact.

6. It may be pertinent to note here that by filing an application herein, the petitioner had sought to amend the petition so as to challenge the legality of notification dated 20.10.2010 published on 25.11.2010, during pendency of the petition, under the Indian Official Secrets Act, 1923. And, that application is dismissed on 20.01.2011, with liberty to the petitioner to file a separate substantive petition, if so advised, for challenging the notification dated 20.10.2010.

7. Since most of the issues sought to be raised in the present proceeding have been raised and decided in the previous SCA No.514 of 2003 by Division Bench of this Court [Coram: J.M.Panchal, J., as His Lordship then was, and H.B.Antani, J.] it would be relevant and necessary to advert to that decision as a direct precedent between the same parties. In that proceeding, notification dated 14.05.2001 under section 4 and declaration dated 09.042002 under section 6 of the Act for acquiring the petitioner's land bearing survey No.29 (P) were challenged as unconstitutional, illegal, against mandatory rules and bad in law. At that time, production capacity of the Company was increased from 9 MMTPA to 27 MMTPA and negotiations for direct purchase of land had failed. Deputy Collector had, after hearing other land owners, submitted his report to Collector on 12.4.2001 who, in turn, submitted his report to the Government on 08.05.2001. The petitioner had filed his objections and after making enquiry, Land Acquisition Officer had forwarded the report under section 5-A (2) of the Act to the Government, who issued declaration under section 6 of the Act on 09.04.2002; and that declaration was the subject-matter of challenge.

The petitioner had raised similar objections and made similar averments to challenge the proceeding and the respondent had taken similar defences. It was contended for the Company that whether the need was genuine or acquisition was excessive were matters for satisfaction of the State Government and once declaration under section 6 was made, it was conclusive proof of the fact that land was needed by the company and the acquisition was not excessive and the Court should not go into those matters as if sitting in appeal. It was also contended that even future need deserved to be taken into consideration and the acquisition was not for profits of the company inasmuch as the lands acquired for the company cannot be sold and/or alienated without previous sanction of the Government. Having noticed the relevant provisions and the scheme of the Act, the Court found that an inquiry under Rule 4 of the Rules was conducted and once it was found to have been made, strictly speaking, it was held to be not necessary for the Court to examine further question whether principles of natural justice were complied with while making the inquiry under Rule 4 of the Rules. However, the Court perused the documents on record and found no substance in the grievance of the petitioner. The Court relied upon the ratio in several judgments of the Apex Court to affirm that even in a case where deviation takes place as regards compliance with principles of natural justice, the Court may insist upon proof of prejudice before setting aside the order impugned before it. The Court held that the word workmen used in section 40 (1) (a) of the Act is both general and comprehensive and, therefore, it should receive its full and natural meaning. Therefore, in the context of section 40 of the Act, the word workmen would mean all those who were employed by the company. Similarly, the plea that the acquisition proceedings were not initiated for genuine need of the company was negatived on the basis that 2000 employees of the company were staying in rented premises located in Jamnagar City and Motikhavdi; and hence it was difficult to conclude that the need to acquire the land was not genuine. The delay caused in filing of the petition was held to have not been explained by the petitioner at all. The petitioner was found to have not been able to substantiate any of the contentions raised by him and the only purpose of filing the petition appeared to the court to be seeking higher amount of compensation from the company. Accordingly, that petition of the same petitioner was dismissed by an elaborate judgment.

8. In order to appropriately consider the contentions of the petitioner, it would be advantageous to quote, as under, the material part of relevant documents and applicable provisions of law, as obtaining in Gujarat.

(a) Notification dated 05.03.2010 under section 4 of the Act:

Whereas it appears to the Government of Gujarat that the lands specified in the Schedule hereto are likely to be needed for company i.e. Reliance Industries Limited, Jamnagar, for public purpose of expansion of employees' existing housing colony and for providing amenities connected therewith. It is hereby notified under the provision of section 4 of the Land Acquisition Act, 1894 (1 of 1894) that the lands are likely to be needed for the purpose specified above.

.... .... ....

If the Government of Gujarat is satisfied that the said lands are needed for the aforesaid purpose, a final notification to that effect under section 6 of the said Act will be published in the Gujarat Government Gazette, in the due course. If the acquisition is in part or wholly abandoned, the fact will be duly notified in the Gujarat Government Gazette.

SCHEDULE.........

  ....	    ....	    .... 
 


 


 


(b)	 Notification

dated 13.08.2010 under section 6 of the Act:

   ....     ....	     ....		
 


	 And

whereas the Government of Gujarat is satisfied after considering the report of the Deputy Collector, Jamnagar Division, Jamnagar under sub-section (2) of section 5-A of the Land Acquisition Act, 1894 (1 of 1894) that the said lands are needed to be acquired at the company's expenses for the purpose specified in column 4 of the Schedule hereto.

It is hereby declared under the provision of section -6 of the said Act that the said lands are required for the purpose specified in column 4 of the Schedule hereto.

SCHEDULE District:

Jamnagar Taluka: Jamnagar Village: Moti Khavdi District, Taluka and Survey Apprx.area Purpose for which Village in which the No of the land/ the lands are land is/lands are lands needed situated required Ha-Are-Sqmt Dist.Jamnagar 25/P2/P1 01-20-00 Expansion of 26/P2 00-04-06 Employees' existing Taluka:Jamnagar 29/P2 02-00-00 Housing Colony and Village:Moti Khavdi 228 02-60-61 providing amenities 229 03-78-38 connected therewith __________ Reliance Industries 09-62-45 Ltd.,Jamnagar.

LAND ACQUISITION ACT, 1894:

PART II ACQUISITION Preliminary Investigation

4. Publication of preliminary notification and power of officers thereupon.-

(1)

Whenever it appears to the appropriate Government that land in any locality is needed or is likely to be needed for any public purpose or for a company, a notification to that effect shall be published in the Official Gazette and in two daily newspapers circulating in that locality of which at least one shall be in the regional language, and the Collector shall cause public notice of the substance of such notification to be given at convenient places in the said locality (the last of the dates of such publication and the giving of such public notice, being hereinafter referred to as the date of the publication of the notification).

(2) .... .... ....

5A.

Hearing of objections.-

(1)

Any person interested in any land which has been notified under section 4, sub-section (1), as being needed or likely to be needed for a public purpose or for a Company may, within thirty days from the date of the publication of the notification, object to the acquisition of the land or of any land in the locality, as the case may be.

(2) Every objection under sub-section (1) shall be made to the Collector in writing, and the Collector shall give the objector an opportunity of being heard in person or by any person authorized by him in this behalf or by pleader and shall, after hearing all such objections and after making such further inquiry, if any, as he thinks necessary, either make a report in respect of the land which has been notified under section 4, sub-section (1), or make different reports in respect of different parcels of such land, to the appropriate Government, containing his recommendations on the objections, together with the record of the proceedings held by him, for the decision of that Government. The decision of the appropriate Government on the objections shall be final.

(3) .... .... ....

6. Declaration that land is required for a public purpose.-

(1) Subject to the provision of Part VII of this Act, when the appropriate Government is satisfied, after considering the report, if any, made under section 5A, sub-section (2), that any particular land is needed for a public purpose, or for a Company, a declaration shall be made to that effect under the signature of a Secretary to such Government or of some officer duly authorized to certify its orders and different declarations may be made from time to time in respect of different parcels of any land covered by the same notification under section 4, sub-section (I) irrespective of whether one report or different reports has or have been made (wherever required) under section 5A, sub-section (2);

Provided that ..... ..... ....

Provided further that no such declaration shall be made unless the compensation to be awarded for such property is to be paid by a Company, or wholly or partly out of public revenues or some fund controlled or managed by a local authority.

Explanation

..... ..... .....

Explanation

2.- .... .... ....

(2) .... .... ....

(3) The said declaration shall be conclusive evidence that the land is needed for a public purpose or for a company, as the case may be; and, after making such declaration, the appropriate Government may acquire the land in manner hereinafter appearing.

PART VII ACQUISITION OF LAND FOR COMPANIES

39. Previous consent of appropriate Government and execution of agreement necessary.-

The provisions of sections 4 to 16 (both inclusive) and sections 18 to 37 (both inclusive) shall not be put in force in order to acquire land for any company under this Part, unless with the previous consent of the appropriate Government, nor unless the Company shall have executed the agreement hereinafter mentioned.

40. Previous enquiry.-

(1) Such consent shall not be given unless the appropriate Government be satisfied. either on the report of the Collector under section 5A, sub-section (2), or by an enquiry held as hereinafter provided, -

(a) that the purpose of the acquisition is to obtain land for the erection of dwelling houses for workmen employed by the Company or for the provision of amenities directly connected therewith, or (aa) ... ... ...

(b) ... ... ...

(2) Such enquiry shall be held by such officer and at such time and place as the appropriate Government shall appoint.

(3) Such officer may summon and enforce the attendance of witnesses and compel the production of documents by the same means and, as far as possible, in the same manner as is provided by the Code of Civil Procedure, 1908 (5 of 1908) in the case of a Civil Court.

41. Agreement with appropriate Government.-

If the appropriate Government is satisfied after considering the report, if any, of the Collector under section 5A, sub-section (2), or on the report of the officer making an inquiry under section 40 that the proposed acquisition is for any of the purposes referred to in clause (a) or clause (aa) or clause (b) of sub-section (1) of section 40, it shall require the Company to enter into an agreement with the appropriate Government, providing to the satisfaction of the appropriate Government for the following matters, namely :-

(1) the

- payment to the appropriate Government of the cost of the acquisition;

(2)

the transfer, on such payment, of the land to the Company.

(3) the terms on which the land shall be held by the Company, (4) where the acquisition is for the purpose of erecting dwelling houses or the provision of amenities connected therewith, the time within which, the conditions on which and the manner in which the dwelling houses or amenities shall be erected or provided;

(4A) ... ... ...

(5) ... ... ...

LAND ACQUISITION (COMPANIES) RULES, 1963

2. Definitions.-

In these rules, 
 

         (i)      
....            .....         ....
 

(ii)

Committee means the Land Acquisition Committee constituted under rule 3.

3. Land Acquisition Committee ........

4. Appropriate Government to be satisfied with regard to certain matters before initiating acquisition proceedings.-

(1) Whenever a company makes an application to the appropriate Government for acquisition of any land, that Government shall direct the Collector to submit a report to it on the following matters, namely :

(i) that the company has made its best endeavour to find out lands in the locality suitable for the purpose of the acquisition;

(ii) that the company has made all reasonable efforts to get such lands by negotiation with the person interested therein on payment of reasonable price and such efforts have failed;

(iii) that the land proposed to be acquired is suitable for the purpose;

(iv) that the area of land proposed to be acquired is not excessive;

(v) that the company is in a position to utilise the land expeditiously; and

(v) where the land proposed to be acquired is good agricultural land, that no alternative suitable site can be found so as to avoid acquisition of that land.

(2) The Collector shall, after giving the company a reasonable opportunity, to make any representation in this behalf, hold an enquiry into the matters referred to in sub-rule (1) and while holding such enquiry he shall :

(I) in any case where the land proposed to be acquired is agricultural land, consult the Senior Agricultural Officer of the district whether or not such land is good agricultural land;

(ii) determine, having regard to the provisions of sections 23 and 24 of the Act, the approximate amount of compensation likely to be payable in respect of the land, which, in the opinion of the Collector, should be acquired for the company; and

(iii) ascertain whether the company offered a reasonable price (not being less than the compensation so determined), to the persons interested in the land proposed to be acquired.

Explanation.

For the purpose of this rule good agricultural land means any land which, considering the level of agricultural production and the crop pattern of the area in which it is situated, is of average or above average productivity and includes a garden or grove land.

(3) As soon as may be after holding the enquiry under sub-rule (2), the Collector shall submit a report to the appropriate Government and a copy of the same be forwarded by that Government to the Committee.

(4)

No declaration shall be made by the appropriate Government under section 6 of the Act unless

(i) the appropriate Government has consulted the Committee and has considered the report submitted under this rule and the report, if any, submitted under section 5A of the Act; and

(ii) the agreement under section 41 of the Act has been executed by the company.

8.1 The petitioner has, in his objection during the enquiry under Section 5A of the Act, in his representations, in the petition and in the written submissions reiterated the following main objections against acquisition.

(1) That many of even existing housing units have not been occupied in the existing housing colony of the company.

(2) That the company has not specified as to how much expansion of the housing colony is really required.

(3) That thousands of acres of land acquired earlier is lying vacant and not used; and (4) That the lands in question are not pocket lands in the existing housing colony but they are outside the existing colony which is surrounded by a boundary wall.

9. Against the above backdrop of facts and record, it was vehemently argued that in absence of consideration of aforesaid issues raised by the petitioner, notifications issued under Sections 4 and 6 of the Act were arbitrary and in colourable exercise of power, which vitiated the whole acquisition proceeding. It was further submitted that there was obvious anomaly in the purpose of acquisition as shown in declaration under Section 6 of the Act insofar as the acquisition for public purpose stood converted to the purpose of expansion of employees' existing housing colony and providing amenities connected therewith by the company. By agreement dated 6.5.2010, the purpose was made exclusively for company and no public purpose could survive as stated in earlier notification, particularly when no part of the compensation was to be contributed from the public exchequer, according to the submission. Learned senior counsel, Mr.Nanavati, strongly urged that security concerns expressed by the respondent in their affidavits cannot provide a public purpose and the ex post facto declaration of the area to be prohibited place by notification dated 20th October 2010 under the Indian Official Secrets Act, 1923 was a clear evidence of mala fide and colourable exercise of power by the respondent. He submitted that the petitioner had, in paragraph 13 of his reply to notice dated 15.3.2010, after notification under Section 4, clearly called for relevant information, which were not only not supplied but the issues arising from those queries were nowhere addressed and considered by the respondent before proceeding further.

9.1 Constitution Bench of the Apex Court in Smt. Somwanti and Others etc. v. State of Punjab and Others [AIR 1963, SC 151] has observed that if there is a colourable exercise of power, the declaration would be open to challenge at the instance of the aggrieved party. If it appears that what the government is satisfied about is not a public purpose but a private purpose or no purpose at all, the action of the government would be colourable as not being relatable to the power conferred upon it by the Act and its declaration will be a nullity. Subject to this exception the declaration of the government will be final. Though the courts are not entitled to go behind the declaration of the government to the effect that a particular purpose for which the land is being acquired is a public purpose, it must be emphasized that the declaration of the government must be relatable to a public purpose as distinct from a purely private purpose. The acquisition for a company contemplated by part VII is confined only to cases where the government is satisfied that the purpose of obtaining a land is erection of dwelling houses for workmen employed by the company or for providing the amenities directly connected therewith or for construction of some public utility which is directly useful to the public. It is also observed in the same judgment that the inclusive definition of public purpose in Section 2 (f) of the Act, not being compendious, is not useful in ascertaining ambit of that expression. Public purpose is bound to vary with the times and the prevailing conditions in a given locality and, therefore, it would not be a practical proposition even to attempt a comprehensive definition of it. It is because of this that the legislature has left it to the government to say what is a public purpose and also to declare the need of a given land for a public purpose.

9.2 In light of the above dicta, it was submitted for the petitioner that when the information sought and the issues raised by the petitioner during enquiry under Section 5A of the Act were not duly considered, after collecting necessary information from the company, satisfaction recorded by the government in the declaration under Section 6 of the Act, that the lands were needed to be acquired at the company's expenses for the purpose of expansion of housing colony, was vitiated and proved the case of the petitioner that the acquisition was in colourable exercise of power. It may be noted here that all these arguments were based upon the ill-founded assumption and vague allegations that the company had not fully utilized the lands which were already acquired and that the land in question was not pocket land .

9.3 Devinder Singh and Others v. State of Punjab and Others [(2008) 1 SCC 728] was relied upon for the proposition that no land should be acquired except for the purpose contained in Clause (a) of sub-section (1) of Section 40 of the Act for a private company which is not a government company and when an order is passed without jurisdiction, it amounts to colourable exercise of power. A statutory authority is bound by the procedure laid down in the statute and must act within the four corners thereof. It is observed therein that expropriatory legislation must be strictly construed. When the properties of a citizen are being compulsory acquired by a State in exercise of its power of eminent domain, the essential ingredients thereof, existence of public purpose and payment of compensation are principal requisites therefor. In the case of acquisition of land for a company, existence of public purpose being not a requisite criterion, other statutory requirement call for strict compliance, being imperative in character.

9.4 Constitution Bench decision of the Supreme Court in State of Bombay v. Purushottam Jog Naik [AIR 1952 SC 317] was relied upon to highlight the absence of affidavit about satisfaction of the government by the secretary or the minister concerned; and it was submitted that the respondent had failed to prove that declaration about requirement of the land in question was bona fide.

10. Learned senior advocate, Mr.Mihir Joshi, appearing for the company submitted that apparently the whole petition was based upon absolutely vague and sweeping allegations against the officers of the company and the State Government, without naming or joining them as parties and without attributing to them any particular act with any details thereof. Such allegations are specifically denied by the respondents. Learned counsel relied upon following observations of Justice Krishna Iyer in Gulam Mustufa and Others v. The Sate of Maharshtra and Others [AIR 1977 SC 448]:

2. Striking down any act for mala fide exercise of power is a judicial reserve power exercised lethally, but rarely. The charge of mala fides against public bodies and authorities is more easily made than made out. It is the last refuge of a losing litigant. ...............

4. ..............

It is not for the Court to investigate into the area necessary for running a market. Moreover, there is no mala fides emerging from the circumstance. ..........

5. ................. original acquisition is valid and title has vested in the Municipality, how it uses the excess land is no concern of the original owner and cannot be basis for invalidating the acquisition.

10.1 He submitted that by virtue of the clear provision contained in Section 6 (3), no further enquiry into the aspect of requirement of the land for public purpose was permissible.

10.2 As held by Constitution Bench of the Apex Court in Babu Barakya Thakur v. State of Bombay and Others [AIR 1960 SC 1203], the acquisition of land for a company is in substance for a public purpose inasmuch as constructing dwelling houses and providing amenities for the benefit of the workmen employed by it and construction of some work of public utility serve a public purpose. The purpose of notification under Section 4 is to carry on preliminary investigation with a view to finding out after necessary survey and taking of levels, and, if necessary, digging or boring into the subsoil whether land was adapted for the purpose for which it was sought to be acquired. It is only under Section 6 that a firm declaration has to be made by the government that land, with proper description and area so as to be identifiable, is needed for a public purpose or for a company. What was a mere proposal under Section 4 becomes the subject matter of acquisition under the Act. Hence, defect in the notification under Section 4 is not fatal to the validity of the proceedings, particularly when the acquisition is for a company and the purpose has to be investigated under Section 5A or Section 40, necessarily after notification under Section 4. The requirement contained in part VII indicate that the acquisition for a company also is, in substance, for a public purpose inasmuch as it cannot be seriously contended that constructing dwelling houses and providing amenities for the benefit of the workmen employed by it and construction of some work of public utility do not serve public purpose.

10.3 As held in Motibhai Vithalbhai Patel and Another v. State of Gujarat [AIR 1961 Gujarat 93] by Division Bench of this Court (Coram:S.T.Desai, C.J. and Bhagwati, J., as Their Lordships then were), Section 4 is an introductory measure and it is tentative in its nature and there is no finality or immutability about it. It is of an exploratory character and it does not proprio motu result in acquisition. The contention that simply in absence of the word 'public purpose' in the first notification it becomes invalid, therefore, was negatived. Therefore, any supposed or alleged anomaly between the purpose of acquisition expressed in notification under Section 4 and declaration under Section 6 have to be ignored, according to the submission.

10.4 A three Judge Bench of this Court in Patel Mangalbhai Nathabhai and Others v. State of Gujarat [AIR 1964 Gujarat 82] held:

It cannot be said that an acquisition for a company cannot be supported as an acquisition for a public purpose as required by Article 21 (2) of the Constitution, unless part of the cost of such acquisition comes out of the public funds. Essential condition for acquisition for a State as distinguished from acquisition for a company, is that cost of acquisition should be borne either wholly or in part out of public funds. Hence, acquisition for a company may also be made for a public purpose if a part or whole of the costs of acquisition is met by the public funds. If, on the other hand, acquisition is to be made at the cost of such a company, such an acquisition would fall under Part VII. Thus, there must exist a public purpose for acquisition, whether it is for the State or for a company, the distinction between the two being that in the first case the cost is met from public funds either wholly or in part and in the latter case it is met wholly by the company.

10.5 It was pointed out from the record by learned senior advocate, Mr.Mihir Joshi, that as early as on 17.8.2009 specific notice was issued to the petitioner inviting him to voice his objections and claims in respect of his lands which were proposed to be acquired, for making report under Rule 4 of the Land Acquisition (Companies) Rules and Section 40 of the Act; and the petitioner had submitted his objections. Thereafter, the Deputy Collector had submitted his detailed report on 10.9.2009 wherein the objections of the petitioner were duly stated and considered. It was recorded therein that the lands in question were private pocket lands in the midst of township to be made by the company and without acquisition of such lands the township cannot be made into one contiguous block. It was reported, even before publication of notification under Section 4, that in order to properly fence and for the purpose of security of whole township, the lands in question had to be acquired. It could not be disputed that the petitioner had joined the process of enquiry and making of the report and had actively participated in the process at the end of which report dated 10.9.2009 was submitted by Deputy Collector to Collector, Jamnagar.

10.6 In the above facts, as held by the Apex Court in Land Acquisition Collector and Another v. Durga Pada Mukherjee and Others [(1980) 4 SCC 271], the onus of proving that the declaration fell within the exception of mala fide or colourable exercise of power, will be on the party claiming the benefit of the exception. The onus is very heavy indeed and cannot be said to have been discharged by mere allegation in that behalf which has been denied by the State. The person challenging declaration must provide material to show that the assertion about public purpose as stated in the declaration was incorrect for the reason that the acquired land was not suitable for any industry or that no industrial activity except that by the company, for which the land is sought to be acquired, had been undertaken in the neighbourhood of the acquired area. In absence of any such material and presence of clear averment to the contrary by the State supported by uncontroverted affidavit, it cuts at the root of the plea of mala fide or colourable exercise of power.

10.7 As held in Chandra Prakash Singh and Others v. Chairman, Purvanchal Gramin Bank and Others [(2008) 12 SCC 292] the presumption under law is in favour of the bona fides of the order unless contradicted by acceptable material. As held in several earlier judgments, burden of establishing mala fides is very heavy on the person who alleges it. The Court would, therefore, be slow to draw dubious inferences from incomplete facts placed before it by a party, particularly when the imputations are grave and they are made against the holder of an office which has a high responsibility in administration. Such is the judicial perspective in evaluating charges of unworthy conduct against ministers and others, not because of any special status, but because otherwise, functioning effectively would become difficult in democracy. The Court may draw reasonable inference of mala fide from the facts pleaded and established. Such inference must be based on factual matrix and such factual matrix cannot remain in the realm of insinuation, surmise or conjecture.

10.8 Delhi Administration v. Gurdip Singh Uban and Others [AIR 2000 SC 3737] was relied upon for the company for the proposition that if the satisfaction was challenged, it would be sufficient if such satisfaction is proved by producing the record on the basis of which Section 6 declaration was issued. In Ratilal Shankarbhai v. State of Gujarat [1972 SCC 264] the plea that the government had not applied its mind was rejected with the observation that before issuing notification under Section 6 there was an enquiry under Section 5A. The government had issued notification after examining the report submitted by the concerned officer and there was no material on record from which it could be reasonably concluded that the government had acted blindly in issuing notification. If the satisfaction were challenged in the Court, the government can show that record upon which the government acted and justify satisfaction expressed in Section 6 declaration.

10.9 Recent decision of the Apex Court in Sooraram Pratap Reddy and Others v. District Collector, Ranga Reddy District and Others [(2008) 9 SCC 552] was relied upon for the respondent for general guidelines and to delineate parameters of judicial review in case of allegations of colourable exercise of power in matters of land acquisition. The Supreme Court has referred to no less than 44 earlier decisions, including the judgment of this Court in Motibhai Vithalbhai Patel (supra), and finally held that, in deciding whether acquisition is for public purpose or not, prima facie, government is the best judge. Normally, in such matters, a writ court will not interfere by substituting its judgment for the judgment of the government.

11. Learned Additional Advocate General Mr.Tushar Mehta, appearing for the State, supported the submissions of the Company with the argument that there was no variance between the 'public purpose' as stated in the notification under section 4 and section 6 of the Act. He further submitted that all the relevant statutory provisions and the prescribed procedure were duly followed in the process of acquiring the lands in question; and the pleas of mala fide, arbitrariness or colourable exercise of power were not established or substantiated by any material on record. The purpose of acquisition was made clear to the petitioner even before publication of the notification under section 4 of the Act. There is no dispute about the fact that refining capacity of the Company was increased from 9 MMTPA to 33 MMTPA which necessarily involved expansion of infrastructure and increase of staff with additional requirement of housing which has to be adjacent to the refinery. He pointed out from the record that right from notice dated 17.08.2009 to the petitioner for making report under Rule 4 of the Land Acquisition (Companies) Rules, 1963 (for short, the Rules ), opportunities of hearing were given individually to the petitioner. The collector concerned had sought report from the Deputy Collector and report was submitted by the Deputy Collector wherein the objections raised by the petitioner were considered. The petitioner had, in his written representation, raised four objections viz. (1) he is unwilling to part with the land under acquisition under any circumstances, (2) as, upon acquisition, he seizes to be an agriculturist, his inherited right would be taken away, (3) the Company is not required to obtain land of agriculturists for township and (4) he would not be able to buy alternative land from the amount of compensation. As recorded in the report, efforts were made to fix the amount of compensation by negotiations, but the demand of some of the objectors was 15 times the reasonable amount offered by the Company. It is reported that the lands in question were pocket land and there was no alternative to acquiring such land. Thus, in short, satisfaction in respect of all the matters mentioned in Rule 4 was reported and after consideration of the report, the Collector had made his submission on 25.9.2009 to the Deputy Secretary of Revenue Department of the State Government.

There was clearly an objective assessment of facts and fair and bona fide application of mind by the State Government, according to the submission.

11.1 Mr.Mehta also submitted that, as against strict compliance of the provisions of law by the respondents, the petitioner has resorted to vague allegations of mala fide and colourable exercise of power and sought to canvass the security concerns of the Company and the State Government as evidence of mala fide. He submitted that the notification dated 20.10.2010 under the Indian Official Secrets Act, 1923 declared not only the lands in question but lands admeasuring 17660.20 acres spread over 2238 survey numbers of ten villages to be prohibited places . Therefore, the submission of the petitioner about the State authorities directing their actions against the petitioner for pressurizing him into leaving the land had no substance. He further submitted that the entire record of the relevant proceeding was made available for scrutiny and for satisfying the conscience of the Court. Out of that record, when learned counsel for the petitioner wanted to inspect minutes of the Committee constituted under Rule 3 of the Rules, copies thereof are supplied to him and the Court. That Committee has briefly but clearly taken into consideration the objections of the petitioner and taken a conscious decision to reject the objections.

11.2 Learned counsel relied upon the following observations of the Apex Court in Girias Investment Pvt. Ltd. v. State of Karnataka. [(2008) 7 SCC 53]...

14. It is obvious from a reading of the pleadings quoted above that only vague allegations of mala fides have been levelled and that too without any basis. There can be two ways by which a case of mala fides can be made out; one that the action which is impugned has been taken with the specific object of damaging the interest of the party and, secondly, such action is aimed at helping some party which results in damage to the party alleging mala fides........

23. As observed above, the appellants have not identified any person who had been instrumental in harming their cause. We would, therefore, even be precluded from going into the question of mala fides although we have nevertheless examined the matter in extenso.

11.3 He referred to and relied upon the observations, as under, of Justice Krishna Iyer in the State of Punjab v.

V.Gurdial Singh [AIR 1980 SC 319) :

1. .........

When thousands of humble litigants are waiting in the queue hungry for justice and the docket-logged court is desperately wading through the rising flood, every 'lawless' cause brought recklessly before it is a dubious gamble which blocks the better ones from getting speedy remedy. Here is an instance.

.... ... ...

9. The question then, is what is mala fides in the jurisprudence of power? Legal malice is gibberish unless juristic clarity keeps it separate from the popular concept of personal vice. Pithily put, bad faith which invalidates the exercise of power - sometimes called colourable exercise or fraud on power and oftentimes overlaps motives, passions and satisfaction - is the attainment of ends beyond the sanctioned purposes of power by simulation or pretension of gaining a legitimate goal. If the use of the power is for the fulfilment of a legitimate object the actuation or catalysation by malice is not legicidal. The action is bad where the true object is to reach an end different from the one for which the power is entrusted, goaded by extraneous considerations, good or bad, but irrelevant to the entrustment. ...........

10. By these canons it is easy to hold that where one of the requisites of S. 4 or 6, viz., that the particular land is needed for the public purpose in view, is shown to be not the goal pursued but the private satisfaction of wreaking vengeance if the moving consideration in the selection of the land is an extraneous one, the law is derailed and the exercise is bad. Not that this land is needed for the mandi, in the judgment of Government, but that the mandi need is hijacked to reach the private destination of depriving an enemy of his land through back-seat driving of the statutory engine. To reach this conclusion, there is a big if to be proved - if the real object is the illegitimate one of taking away the lands of the respondents 1 to 21 to vent the hostility of respondent 22, under the mask of acquisition for the mandi.

12. It is quite clear from the facts on record and the submissions for the parties that since the first notice dated 17.08.2009 to the petitioner under Rule 4 of the Rules, the petitioner has objected to acquisition of his remaining land and expressed his unwillingness to part with the land at any price. It is undisputable that a major portion of the agricultural land of the petitioner is already acquired in the previous proceeding initiated in the year 2000 and the challenge to that acquisition has failed by virtue of the decision dated 22/23.8.2005 of Division Bench of this Court. It is also undisputable that large areas of land surrounding the lands in question are already acquired by the Company for expansion of its housing colony and provision of amenities connected with such colony. Therefore, the contention that the lands in question are not pocket land within the existing housing colony of the Company is incorrect and misleading insofar as the proposed expansion of housing colony for which lands are already acquired cannot be ignored. There is no serious challenge to compliance with the procedural aspect as prescribed in the provisions of the Act and the Rules. As for the requirement of the Company, there is no dispute about the increase in its refining capacity and consequent requirement of larger area of land for housing its staff. It must be noted that requirement of section 4 of the Act includes a tentative opinion of the appropriate Government that land in any locality is needed or is likely to be needed for any public purpose or for a company. Therefore, and in the nature of things, the land sought to be acquired has to be needed for use immediately or in the near future. In absence of any material suggesting otherwise, there cannot be a presumption that land would be acquired entirely at the cost of the Company without any utility or purpose. Provisions of section 41 of the Act provide for setting the time-limit within which dwelling houses and the amenities connected therewith should be erected. The agreement in which several conditions are statutorily required to be incorporated under section 41 of the Act is also required to be published in the Gazette under section 42 of the Act. Transfer of such land is also restricted by the provisions of section 44-A of the Act. Therefore, it is not easy to conclude, merely on the basis of vague allegations, that the Company would acquire large tracts of land at the cost higher than the market price for any extraneous reasons and not utilize it for the stated purpose.

13. However, in above context the petitioner has alleged, not in the averments on oath in the petition, but in Ground-C which is not on oath, that:

.....the areas acquired under 2001 acquisition are yet not fully constructed......the disputed lands are outside the compound wall of respondent No.3 and is surrounded by other vacant plots of land not belonging to the respondent No.3 and not the housing colony complex. The said vacant plots of land do not form part of residential colony of respondent No.3, nor do they belong to respondent No.3 .

Similarly, following allegations are made in Ground- D of the petition:

.......The petitioner says that Mr.Parimal Nathwani belongs to Jamnagar district and he, Ambani family have influenced the Government having regard to the high position he is occupying and that the acquisition proceedings are initiated without any bona fide need or requirement by respondent No.3. In private officials in the office of Collector say that this has been done by orders of higher ups. .......The petitioner says that respondent No.3 has already acquired lakhs of acres of land under the Land Acquisition Act and thus deprived poor agriculturist of his lands and such acquired lands are used by respondent No.3 for luxurious living of officers of respondent No.3 and is also used for sports and playgrounds and other higher class of amenities. The petitioner says that large area of land in thousands of acres is still lying vacant and is not used and that in 1000 acres of land mango plantation has been made which is not the purpose of respondent No.3. Respondent No.3 is not utilizing the land which is already acquired for the purpose for which acquisition was made in the past. The petitioner says that 1000 of residential quarters of respondent No.3 are lying vacant and the respondent has misused the land by utilizing 1000 acres for mango plantation and making luxurious buildings for VIPs and guests and also providing golf course, tennis, stadium and playground and five-star buildings. ......

These and such other allegations appeared to have been made with complete impunity and irresponsibility, inasmuch as they are made in paragraph 11 under the heading of Grounds in the petition and those statements are not made on oath. Although all these allegations and averments are denied generally by the respondent, the petitioner has lost the opportunity of eliciting full and true facts simply by skillful drafting of his own petition, and not making material assertions on oath. Such pleadings only cast doubts on the bona fides of the petitioner himself. In short, the averments and allegations made by the petitioner are insufficient and unreliable for proving mala fide or colourable exercise of power or for shifting the burden of proof on to the respondent.

14. As seen from the voluminous record of the acquisition proceeding in question, it is undisputable that the lands in question are contiguous to the area of existing housing colony of the Company and they are completely surrounded by the lands already acquired by the Company for the purpose of expansion of the housing colony and amenities connected therewith. Even completely disregarding the recent notification dated 20.10.2010 declaring large areas of surrounding lands to be prohibited places , the lands in question being located in the middle of other lands held by the Company, the security concerns of the respondents are completely justified. While making report dated 10.09.2009 (Annexure-R6), the Collector has taken into consideration the relevant aspects and the objections of the petitioner and specifically mentioned requirement of land for safety and security and for making a contiguous block of land for the township. The subsequent proceedings, including consideration by the Committee comprising of high level ex-officio members, clearly reveal application of mind to the requirement of lands as well as objections of the petitioner. Under such circumstances, the allegations of the petitioner, lacking in substance and bona fide, are found to be ineffective for overturning the declaration under section 6 of the Act which is statutorily mandated to be conclusive evidence that the land is needed for the Company, as provided in section 6 (3) of the Act. Therefore, even as it had appeared to the Division Bench in the earlier case that the petition was an attempt to seek higher amount of compensation, it has to be again recorded that the petitioner has made a repeated attempt towards the same end and that attempt is far from bona fide. The argument that no sooner the petitioner sought necessary information in respect of use of the lands already acquired by the Company it was incumbent upon the Government to enquire into the aspect of actual use of such land, has to be stated to be rejected and no adverse inference could be drawn against the respondent in absence of any serious and substantial allegation on oath. The grounds and arguments agitated for the petitioner are not only addressed in submissions made for the respondent, but they are directly covered by decisions of the Apex Court as enumerated in paragraph 10 herein; and repetition thereof will be redundant. Suffice it to observe that while protective provisions of the expropriatory legislation must be strictly construed, Court cannot easily jump to the conclusion of mala fide or colourable exercise of power where the acquisition of land for the company is found to be imbued with public purpose and larger interest of society. Neither the satisfaction nor the impugned decision of the Government, nor the decision making process culminating into acquisition of land of the petitioner could be shown to be so vulnerable as to justify interference in exercise of the extraordinary writ jurisdiction of this Court.

15. Therefore, in the facts and for the reasons discussed hereinabove, the petition is found to be wholly devoid of any substance or merit and it is accordingly dismissed. Notice is discharged and ad-interim order to maintain status quo in respect of the acquisition proceeding and possession of the land in question is vacated, with no order as to costs.

Sd/-

( D.H.Waghela, J.) Sd/-

( K.A.Puj, J.) Upon pronouncement of the above judgment, learned counsel Mr.B.P.Munshi has prayed for continuation of ad-interim relief for a further period of four weeks. Since there is no justification for granting such relief, the request is rejected.

Sd/-

( D.H.Waghela, J.) Sd/-

( K.A.Puj, J.) (KMG Thilake) Top

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