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25. The impugned enactment has its genesis in the resolutions passed by eleven sponsoring States under Article 252(1) of the Constitution. The State Legislatures of Andhra Pradesh, Gujarat, Haryana, Himachal Pradesh, Karnataka, Maharashtra, Orissa, Punjab, Tripura, Uttar Pradesh and West Bengal considered it desirable to have an uniform legislation enacted by Parliament for the imposition of ceiling on urban property for the country as a whole and as required by the first part of Article 252(1) of the Constitution passed a resolution to that effect. Parliament accordingly enacted the Urban Land (Ceiling and Regulation) Act, 1976. It received the assent of the President on February 17, 1976 and, in the first instance, it came into force on that day in all the Union Territories and the 11 States which had passed the requisite resolution under the first part of Article 252(1). Subsequently, the Act' was adopted, by passing resolutions under the second part of Article 252(1) by the State Legislatures of Rajasthan on March 9, 1976, Manipur on March 12, 1976, Assam on March 25, 1976, Bihar on April 1, 1976, Meghalaya on April 7, 1976 and Madhya Pradesh on September 9, 1976. Thus, the enactment is in force in 17 States and all the Union Territories in the country. It seeks to impose ceiling on vacant lands in urban agglomerations having a population of two lakhs or more and for that purpose classifies such urban agglomerations in various cities and towns in all the States and Union Territories into four categories and fixes the ceiling limit for each of the categories thus : Ceiling limit on vacant land is fixed at 500 sq. metres for the urban agglomerations of the metropolitan areas of Delhi, Bombay, Calcutta and Madras having a population exceeding ten lakhs falling under category 'A', at 1,000 sq. metres for urban agglomerations with a population of ten lakhs and above, excluding the four metropolitan areas, falling under category 'B, at 1,500 sq. metres for urban agglomerations with a population between three lakhs and ten lakhs falling under category 'C and at 2,000 sq. metres for urban agglomerations with a population between two lakhs and three lakhs falling under category 'D' : vide Section 4 read with Schedule I of the Act The said Schedule does not mention the urban agglomerations having a population of one lakh and above but if a particular State which passed a resolution under Article 252(1) (first part) or if a State which subsequently adopts the Act by passing a resolution under Article 252(1) (second part) wants to extend the Act to such areas, it could do so by a Notification under Section 2(n)(A)(ii) or Section 2(n)(B), as the case may be, after obtaining the previous approval of the Central Government. Chapter III, being the main Chapter, comprising Sections 3 to 24, deals principally with imposition and limits of ceiling on vacant land, acquisition and vesting in the State Government of vacant land in excess of the ceiling limits, payment to be made to the holders for such acquisition, disposal of excess vacant land so acquired and exemptions from the applicability of this Chapter. Chap. IV comprising Sections 25 to 30 deals with regulation of transfer and the use of urban property; while Chapter V which inclules Sections 31 to 47, deals with appeals, revisions, offences and punishments and other miscellaneous matters.

42. The next provision challenged by the petitioners as being violative of their fundamental rights is Section 11(6) which puts the maximum limit of Rs. two lakhs on compensation (called 'amount') payable to the holder of excess vacant land irrespective of the extent of such excess vacant land. For the purpose of determining the quantum of compensation Section 11(1) divides vacant land in urban agglomerations into two categories-(i) vacant land from which income is derived and (ii) vacant land from which no income is derived and in regard to the former category Clause (a) of Sub-section (1) fixes the quantum payable at an amount equal to eight and one third times the net average annual income actually derived from such land during the period of five consecutive years immediately preceding the date of publication of the notification issued under Section 10(1) and the net average annual income is to be calculated in the manner and in accordance with the principles set out in Schedule II; while in respect of the latter category, Clause (b) of Sub-section (1) fixes the quantum payable at an amount calculated at a rate not exceeding-(i) Rs. 10/- pep-sq. metre in the case of vacant land situated in urban agglomerations falling with categories A and B and (ii) Rs. 5/- per sq. metre in the case of vacant land situated in urban agglomerations falling within categories C and D. In other words, for vacant land yielding income the method of capitalisation or the income for certain number of years is adopted while for vacant land yielding no income maximum rates of compensation for A and B categories at Rs. 10/-per sq. metre and for C and D categories at Rs. 5/- per Sq. metre have been fixed. Compensation (called 'amount') once determined is payable to the holder under Section 14(2) in a certain manner, namely, 25% thereof will be paid in cash and the balance 75 per cent in negotiable bonds redeemable after expiry of 20 years carrying interest at 5% per annum. Section 11(6) which puts the maximum limit of two lakhs on the quantum payable in respect of excess vacant land acquired under the Act runs thus:

54. The legislative competence of Parliament to enact the Urban Land (Ceiling and Regulation) Act, 1976 having been upheld by this Court in Union of India v. Valluri Basavaiah Chaudhary there remains the question of its constitutional validity.

55. Schedule I to the Act list out all States, irrespective of whether or not they have passed a resolution under Article 252(1) authorizing the Parliament to enact a law imposing a ceiling on urban immovable property, and the 'urban agglomerations in them having a population of two lacs or more. The ceiling limit of vacant land of metropolitan areas of Delhi, Bombay, Calcutta and Madras having a population exceeding ten lacs falling under category 'A' is 500 sq. metres; urban agglomerations with a population of ten lacs and above, excluding the four metropolitan areas falling under category 'B' is 1000 sq. metres; urban agglomerations with a population between three lacs and ten lacs falling under category 'C is 1500 sq. metres and urban agglomerations with a population between two lacs and three lacs falling under category 'd' is 2000 sq. metres. The schedule does not mention the urban agglomerations having a population of one lac and above; but if a particular State which passed a resolution under Article 252(1), or if a State which subsequently adopts the Act, wants to extend the Act to such areas, it, could do so by a notification under Section 2(n)(B) or Section 2(n)(A)(ii), as the case may be, after obtaining the previous approval of the Central Government.

70. Although the impugned Act is enacted with a laudable object, to sub-serve the common good, In furtherance of the Directive Principles of State Policy under Article 89(b) and (c), it appears from the terms of Sub-sections (1), (2) and (3) of Section 23 that it would be permissible to acquire vacant land in urban agglomerations and divert it for private purposes. The whole emphasis is on industrialisation. The opening words in Section 23(4) "subject to the provisions or Sub-sections (1), (2) and (3) make the provisions of Section 28(4) subservient to Section 28(1) which enables the Government to allot vacant land in an urban agglomeration to any person for any purpose relating to, or in connection with, any industry or for providing residential accommodation of such type as may be approved by the State Government to the employees of any industry. It further makes it lawful for the allottee, that is, the industrialist, to hold such land in excess of the ceiling limit. The definition of the word 'industry' in Explanation (b) to Section 23(1) is -wide enough to include any business, profession, trade, undertaking or manufacture and necessarily includes the private sector. The proviso to Section 23(2) fortifies that construction of mine. It is incomprehensible that vacant lands in all urban agglomerations throughout the country should be acquired for the purpose of setting up industries. More so, as it is permissible to allow setting up of industries for private gain. There is no material placed before us showing that the Government has prepared any blueprint for industrialisation of all the urban aggloaierations in India in the public sector.