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2. The facts of the case are not in dispute. The State of Punjab issued Notifications Exhibits P-1 to P-29 dated March 13, 2000 under Section 4 of the Land Acquisition Act, 1894 (hereinafter referred to as 'the Act') for acquisition of about 9354 acres of land in 29 villages of the district of Ropar. The acquisition was proposed to be made for "a public purpose namely for setting up of new town, Anandgarh". Objections were invited against the proposed acquisition. Several writ petitions were filed before the High Court challenging the aforesaid Notifications alleging that the Notifications had been issued in derogation of the provisions of the Punjab Regional and Town Planning and Development Act, 1995 (hereinafter referred to as 'the Act of 1995'). It was stated that to set up a new town, the site had first to be selected by the Board constituted under the Act of 1995. The Board was thereafter required to designate a planning agency. This was not done. The provisions of Sections 56, 57, 58 and 59 of the Act of 1995 were completely ignored. Though the New Town Planning and Development Authority for Anandgarh was constituted by the Government on May 20, 1999 under Section 31 of the Act of 1995, in the absence of a decision of the Board under Sections 56 and 57 of the Act of 1995, the aforesaid Special Town Planning Authority for Anandgarh could not take up the planning and development of the new township. It was alleged that a large number of influential persons including senior bureaucrats had bought land in the area with a view to earn profit since the Government had announced compensation at an exorbitant rate. It was also submitted that the provisions of the Punjab New Capital (Periphery) Control Act, 1952 (hereinafter referred to as 'the Periphery Act') and the rules framed thereunder have been violated. Apart from these legal submissions it was also urged that the site was not suitable for a new town.

3. The appellants (respondents in the writ petitions) contested the writ petitions and submitted that the State Government having taken a decision to set up a new township Anandgarh, and having appointed a Special Planning Authority under Section 31 of the Act, the Board had no role to play in the matter and it was not necessary that the Board should have first selected a site and designated a planning agency before the Special Planning Authority could take any action for planning and development of the new township. It was also submitted that the Periphery Act did not inhibit the State of Punjab from acquiring land in the controlled area under the Periphery Act for the purpose of setting up a township.

7. Accordingly, the High Court held that the State action did not conform to the requirements of the Act of 1995 and thus could not be sustained.

8. The High Court held that the provisions of the Periphery Act, 1952 had also been violated. It concluded that though Section 10 did not affect the power of the Government or any other authority to acquire land in the controlled area under any other law for the time being in force, yet the bar contained in Section 5 prohibited the erection or buildings or making of roads even under the garb of establishing a new town without permission of the competent authority under the Periphery Act. No such permission had been taken by the Government and yet the land was sought to be acquired for the purpose of setting up a new town. On the question of mala fide the High Court did not record a categoric finding and gave to the State the benefit of doubt.

13. Shri Sanjiv Sharma, learned Additional Advocate General, in his supplementing arguments submitted that since the functions of PUDA under Section 28 of the Act could be entrusted to the Special Urban Planning and Development Authority constituted under Section 29 and the New Town Planning and Development Authority under Section 31 of the Act of 1995, the Board constituted under Section 3 of the Act did not come into the picture at all. He also emphasized the fact that the challenge was to the Notifications issued under Section 4 of the Land Acquisition Act asking not for a writ of mandamus but for quashing the Notifications on the ground that there existed no valid and legal public purpose for which the acquisition was purported to be made. According to him the scheme of the Act left no room for doubt that the powers of the State Government were wide enough to include selection of the site for a new town. Indeed the Board had no mechanism for selecting an appropriate site for a new town and, therefore, the State Government followed the route of Sections 28, 38 and 42 of the Act of 1995 i.e. by conferring on the New Town Planning and Development Authority constituted under Section 31 of the Act the powers and functions of PUDA under section 28 of the Act, and then acquiring the land on the recommendation of the New Town Planning and Development Authority under Section 42 of the Act of 1995. He further submitted that if the High Court was right in its opinion the State would be compelled to first move the Board for the purpose of selection of site. This was wholly unnecessary because in all cases the sanctioning authority being the State, its powers and authority must be interpreted in that larger perspective. He also submitted that there was no requirement in law that a detailed plan complete in all respects must precede the acquisition under the Land Acquisition Act. He also emphasized the provisions of Section 10 of the Perphiery Act and submitted that the State was not inhibited from acquiring lands which came within the controlled area under the Periphery Act, and this was made explicit by Section 10 of the Periphery Act.