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1989 DIGILAW 143 (KER)

Greater Cochin Development Authority v. Mathew

1989-03-20

PARIPOORNAN

body1989
Judgment :- 1. The Greater Cochin Development Authority is the petitioner herein. The prayer in this Original Petition is to quash Exts.P9 and P10 orders (Proceedings) of the Special Tahsildar (LA), GCDA, Cochin (2nd respondent) in L.A.C.No.46/82 dated 26-3-1988 and L.A.C.No.22/80 dated 28-3-1988. The petitioner is having many schemes for the development of areas in Cochin and its suburbs. Elamkulam West Town Planning Scheme is one such scheme. The petitioner approached the third respondent Government of Kerala - for acquisition of land lying within the scheme area. It was sanctioned by the Government. The second respondent issued Sec.3(1) notification under the Kerala Land Acquisition Act in the Gazette dated 21-11-1978. The lands belonging to many persons were included therein. The land belonging to the first respondent herein was also included in the acquisition. In this Original Petition, the dispute is regarding 71 cents in Sy.No.1013/ 1&5, belonging to the first respondent, which was also the subject matter of acquisition. We are not concerned with the other lands acquired in the said scheme belonging either to the first respondent or others. So far as the above 71 cents of land is concerned, the petitioner and the first respondent entered into an agreement on 20-2-1979. The amount of compensation to be paid to the first respondent for the above 71 cents of land was fixed in the said agreement. It was also agreed that the first respondent will not dispute the adequacy of compensation awarded in respect of the properties. The amounts have to be paid to the first respondent as per the conditions stated in the said agreement. It is stated that the petitioner took possession of the land on 21-4-1979 and the amounts due to the first respondent were paid at varying dates from 6-4-1979 to 24-3-1983. The second respondent passed the award in L.A. C.46/ 82andL.A. C.28/ 83onll-3-1983. It is the petitioner's definite plea that the said agreement was entered into between the petitioner and the first respondent voluntarily and the first respondent accepted the amount fixed as compensation without protest and he was paid the amounts due. The second respondent passed the award in L.A. C.46/ 82andL.A. C.28/ 83onll-3-1983. It is the petitioner's definite plea that the said agreement was entered into between the petitioner and the first respondent voluntarily and the first respondent accepted the amount fixed as compensation without protest and he was paid the amounts due. But, the petitioner complains that nearly five years after the award was passed and the amounts were paid to the first respondent, he filed Ext.P7 application on 25-1-1988 before the second respondent under S.28A of the Land Acquisition Act, 1894, on the strength of a decree in L.A.R.No.176 of 1984, Sub Court, Ernakulam. L.A.R. No. 176 of 1984 is an award passed for the adjacent property. According to the first respondent, the said property is also covered by the same notification. Alleging that Ext.P7 was not disposed of, the first respondent filed O.P.No.1686 of 1988 in this court. This Court directed the second respondent to consider as to whether the first respondent is entitled to ask for enhanced compensation under S.28A of the Act in the light of the agreement dated 20-2-1979 and dispose of the matter on the merits in accordance with law. The judgment in the O.P. was delivered on 16-3-1988. The O.P. was disposed of at the admission stage. The petitioner herein was not heard by this Court at that time. Purporting to act on the basis of the directions contained in the judgment in O.P.No.1686 of 1988 dated 16-3-1988 (Exct.P8), the second respondent passed Exts.P9 and P10 orders on 26-3-1988 and 28-3-1988. The petitioner complains that as against a total compensation of Rs.86,981/-, which was fixed as the compensation by mutual agreement entered into between the parties, the second respondent awarded a sum of Rs. 10,33,392 and Rs. 1,20,379/-. The grievance of the petitioner is that in passing Exts.P9 and P10 orders, under S.28A of the Land Acquisition Act, the second respondent acted without bona fide, arbitrarily, illegally and even without notice to the petitioner. So, Exts.P9 and P10 deserve to be quashed. 2. The first respondent has filed a detailed counter-affidavit, dated 6th June, 1988, justifying Exts.P9 and P10. It is also stated that there is a violation of the agreement dated 20-2-1979 by the petitioner and so it was voidable at the instance of the first respondent and in this view he was entitled to and did press for an enhanced compensation. The first respondent has filed a detailed counter-affidavit, dated 6th June, 1988, justifying Exts.P9 and P10. It is also stated that there is a violation of the agreement dated 20-2-1979 by the petitioner and so it was voidable at the instance of the first respondent and in this view he was entitled to and did press for an enhanced compensation. According to the first respondent, the property is a very valuable one than the adjacent property, which was the subject matter of L.AR.No.176 of 1984. He would also contend that no notice is necessary to the petitioner before passing orders on Ext.P7 under S.28A of the Land Acquisition Act. It is stated that the petitioner is not "a person interested" in the matter and so Exts.P9 and P10 orders, without notice to the petitioner, are not open to any challenge. 3. The third respondent has filed a detailed counter-affidavit dated 19-9-1988. After stating about the acquisition of 71 cents of land in Sy.No.1013/1 & 5, the payment of compensation on various dates to the first respondent in the sum of Rs.85,000/- and the passing of the award on 11-3-1983, it is the third respondent's case that on motion by the first respondent the second respondent passed Exts.P9 and P10, which are illegal and unauthorised, and passed without adverting to the agreement entered into by the parties. The third respondent has categorically pointed out that the enhancement of compensation allowed is not in order and S.28A of the Land Acquisition Act is not applicable in the particular case, as the award was passed on the basis of the agreement and the agreement is still in force. 4. The petitioner has filed C.M.P.No.31967 of 1988 and has sought permission to produce Exts.P14 and P15, Awards passed in L.A.C.No.22/80 and L.A.C.No.46/82 dated 20-5-1982 and 11-3-1983. Along with Exts.P14 and P15, the note to the award a fairly long note - of the Special Tahsildar (LA), GCDA dated 11-3-1983 is also filed. It is stated in Para.5 of the note, dealing with 71 cents of land in Sy.No.1013/1 & 5 belonging to the petitioner, that Sri.Mathew (first respondent herein) negotiated the land value with the requisitioning authority and agreed to sell the property at Rs. 1792 per acre for wet land and Rs.3721/-per acre for dry land, inclusive of improvements and solatium. It is stated in Para.5 of the note, dealing with 71 cents of land in Sy.No.1013/1 & 5 belonging to the petitioner, that Sri.Mathew (first respondent herein) negotiated the land value with the requisitioning authority and agreed to sell the property at Rs. 1792 per acre for wet land and Rs.3721/-per acre for dry land, inclusive of improvements and solatium. He also entered into an agreement with the requisitioning authority (G.C.D.A) and agreed that he would not dispute the adequacy of compensation. The land was handed over possession on 6-4-1979. The first respondent also received advance payments. 5. I heard counsel for the petitioner, Mr.M.V.Joseph, counsel for the first respondent, Sri.Sreekumar and the learned Government Pleader, who appeared for the third respondent-State of Kerala. The crucial point that was argued before me, was that Exts.P9 and P10 were passed without notice and hearing the petitioner and is against the mandate of S.28A of the Land Acquisition Act. It was argued, that in the light of this fundamental or indelible infirmity, the other aspects on the merits need not be gone into, at this stage. It appears to be so. The sole question that arises, at this stage, is whether Exts.P9 and P10 orders passed by the second respondent are illegal and unauthorised and violative of the principles of natural justice. 6. S.28A of the Land Acquisition Act reads as follows: "28-A Re-determination of the amount of compensation on the basis of the award of the Court. The sole question that arises, at this stage, is whether Exts.P9 and P10 orders passed by the second respondent are illegal and unauthorised and violative of the principles of natural justice. 6. S.28A of the Land Acquisition Act reads as follows: "28-A Re-determination of the amount of compensation on the basis of the award of the Court. - (1) Where in an award under this Part, the Court allows to the applicant any amount of compensation in excess of the amount awarded by the Collector under S.11, the persons interested in all the other land covered by the same notification under S.4, sub-section (1) and who are also aggrieved by the award of the Collector may, notwithstanding that they had not made an application to the Collector under S.18, by written application to the Collector within three months from the date of the award of the Court require that the amount of compensation payable to them may be re-determined on the basts of the amount of compensation awarded by the Court: Provided that in computing the period of three months within which an application to the Collector shall be made under this sub-section, the day on which the award was pronounced and the time requisite for obtaining a copy of the award shall be excluded. (2) The Collector shall, on receipt of an application under sub-section (1), conduct an inquiry after giving notice to all the persons interested and giving them a reasonable opportunity of being heard and make an award determining the amount of compensation payable to the applicants. (3) Any person who has not accepted the award under sub-section (2) may, by written application to the Collector, require that the matter be referred by the Collector for the determination of the Court and the provisions of S.18 to 28 shall, so far as may be, apply to such reference as they apply to a reference under S.18 The import of the crucial words occurring in S.28-A(1), to the effect "the amount of compensation payable to them may be "re-determined", after "giving notice to all persons interested and giving them a reasonable opportunity of being heard" in Sec.28-A(2), fall for consideration, in this case. Construing the words "amount of compensation, payable to them" occurring in S.28-A(1) of the Act, Sri. Construing the words "amount of compensation, payable to them" occurring in S.28-A(1) of the Act, Sri. V.G.Ramachandran in the book "Law of Land Acquisition and Compensation" 7th Edition (1986) Vol.I, ate page 857, states as follows: "The "expression payable to them" in new S.28-A may require scrutiny. If the award-amount is already received without protest can a claimant still press into service S.28-A? The answer seems to be in the negative for three persons. First, the person seeking to invoke S.28-A need be aggrieved by the award. But one already receiving the award-amount as offered by the Collector cannot be said to be aggrieved. Secondly, the amount sought to be redetermined should be payable but not paid. Thirdly, the second proviso to S.31(2) of the Act would stand in the way of his invoking S.28-A read with S.18, he having received the amount without protest." In this case, it is common ground that an agreement was entered into between the petitioner and the first respondent on 20-2-1979, regarding the compensation payable. It is further seen from the notes to the award (Appendix to Ext.P15) that the first respondent had agreed that he would not dispute the adequacy of compensation. On the basis of these records, prima facie, it appears that the first respondent cannot claim for re-determination of the amount of compensation; since the award is passed on consent and the amount due under the award was paid to the first respondent on varying dates from 6-4-1979 to 24-3-1983. What is contemplated by S.28-A(1) is redetermination of "the amount payable". There is no material to show that the first respondent received the amount awarded under protest, though such a plea is raised by the first respondent. According to him the petitioner did not comply with the terms of the agreement and so it is "voidable" and he received the amount only under protest. In the nature of the rival pleas of the parties, it requires adjudication on the basis of materials. The adjudication cannot be made without notice to the petitioner, who is to pay the compensation. The second respondent, in Exts.P9 and P10, has proceeded on the basis that the agreement became invalid and unenforceable. Such an adjudication can be made only after hearing the petitioner. It is a further moot question, whether it is open to the second respondent to adjudicate the said question. The second respondent, in Exts.P9 and P10, has proceeded on the basis that the agreement became invalid and unenforceable. Such an adjudication can be made only after hearing the petitioner. It is a further moot question, whether it is open to the second respondent to adjudicate the said question. It is for a competent Court to set aside or nullify a valid agreement entered in to between the parties. That has not been done. In the above background, the question as to whether Ext.P7 filed by the first respondent, under S.28-A of the Land Acquisition Act, on 25-1-1988, itself, is maintainable and calls for adjudication and involves important question of fact and law. 7. Highlighting the above aspects, petitioner's counsel submitted that the second respondent acted illegally and unauthorisedly in proceeding to redetermine the compensation under S.28-A of the Land Acquisition Act, without notice to the petitioner. It was argued that before reopening an award or re-determining the compensation, which has great civil consequences on the petitioner, the petitioner was entitled to be heard. It cannot admit of any doubt that an adjudication under S.28-A of the Act is fraught with great civil consequences on the petitioner. It is the petitioner who has to pay the compensation. It is open to the petitioner to contend and show that the application under Sec.28-A itself is not maintainable.It is a jurisdictional fact. The petitioner can show that this is not a case where the crucial words occurring in S.28-A(1)of the Act, "the amount of compensation payable to them" is to be re-determined. Without an opportunity in that behalf, any pronouncement deciding those jurisdictional aspects, will only be unauthorised, unilateral and not binding on the petitioner. So, it was argued that under ordinary principles of law, in order to comply with the principles of natural justice, the second respondent should have served notice on the petitioner before disposing of Ext.P7 application filed under S.28-A of the Land Acquisition Act. It was also argued that under S.28-A of the Act, the second respondent was bound to conduct "an enquiry" in the matter and that enquiry should be conducted only after "notice to all persons interested" and after giving them a reasonable opportunity of being heard. This was not complied with in the instant case and so Exts.P9 and P10 are infirm and invalid. 9. This was not complied with in the instant case and so Exts.P9 and P10 are infirm and invalid. 9. On the above rival contentions of the parties, I am of the opinion, that even de hors S.28-A(2) of the Act, the second respondent was obliged to serve a notice on the petitioner before adjudicating Ext.P7 application filed by the first respondent under S.28-A of the Land Acquisition Act. It is the petitioner who is primarily and solely concerned with the disbursement of the compensation amount. It is the petitioner alone who can show that the application under Sec.28-A of the Act itself will not lie. The facts and the necessary plea to show that it is not a case where re-determination of the compensation is called for, can only be done by the petitioner. That is a jurisdictional fact. The facts will be fairly within the knowledge of the petitioner. Long lapse of time since the award is passed, the subsequent events, which may have its impact, the scope of the agreement entered into between the petitioner and the first respondent, dated 20-2-1979, as to whether it is voidable, as to whether the first respondent received the award-amount under protest, as to whether it is open to the second respondent to adjudicate that the agreement dated 20-2-1979 is no longer in force etc., are all basic or vital or jurisdictional facts which may require adjudication by a court. The solemn agreement entered into between the parties should normally be given effect to until it is set aside in appropriate forum. These aspects require appraisal and evaluation. In the circumstances, it is the petitioner who can alone urge and substantiate the above aspects. It appears that on these highlights even de hors Sec.28-A(2) of the Act, the petitioner is entitled to notice and hearing before the application filed, under Sec.28-A of the Act, by the first respondent, is disposed of on the merits.(See Binapani's case- AIR 1967 S.C.1269). 10. Next I shall deal with S.28-A(2) of the Act. S.28-A(2) of the Act postulates an enquiry in the matter. It can be done only after giving notice to all the persons interested. A reasonable opportunity of being heard should also be afforded to the persons interested. It cannot be denied that once the matter is disposed of, the parties can assume that a finality has been reached in the matter. It can be done only after giving notice to all the persons interested. A reasonable opportunity of being heard should also be afforded to the persons interested. It cannot be denied that once the matter is disposed of, the parties can assume that a finality has been reached in the matter. It was so in this case when the award was passed on 11-3-1983. It also appears that the compensation amount was fully paid on varying dates from 6-4-1979 to 24-3-1983. The petitioner took possession of the land as early as 21-3-1979. The attempt by filing the application under Sec.28-A of the Act is to re-open the award. It is a proceeding to re-do the entire matter. It unsettles the finality reached by the award already passed. In such circumstances, where an enquiry is contemplated for the application filed under S.28-A of the Act, normally and naturally the "persons interested" in the matter, will certainly take in, the person who has to pay the compensation award. That is the very purpose for which S.28-A(1) is invoked. So, the crucial words in S.28-A(2) "all the persons interested", in the background of the legislation and in the context, will certainly take in the party who is to pay the compensation awarded or determined by the appropriate authority. I am of the view that the words occurring in S.28-A(2) of the Act are clear and unambiguous. Notice to all the persons interested will take in the person or authority who is bound to pay the compensation in the particular land acquisition matter. 11. Counsel for the first respondent relied on the proviso to S.50(2) of the Act and wanted to emphasize that on a harmonious interpretation of S.18, 28-A(3) and 50(2) of the Act, the petitioner cannot be said to be an interested person as envisaged in S.28-A(2) of the Act. It may be that normally the petitioner may not be entitled to demand a reference under S.18 of the Act. But, that cannot be a circumstance to construe that the petitioner is not a person interested within the meaning of S.28-A(2)of the Act which deals with a different situation. It may be that normally the petitioner may not be entitled to demand a reference under S.18 of the Act. But, that cannot be a circumstance to construe that the petitioner is not a person interested within the meaning of S.28-A(2)of the Act which deals with a different situation. I have already indicated that even in the absence of a specific provision in S.28-A(2) of the Act, before an award already passed is sought to be re-opened, the person or authority, who is to pay the compensation, is entitled to notice and hearing. That apart, as observed by the Supreme Court in Santosh Kumar v. Central Warehousing Corporation (AIR 1986 S.C.1164), under the scheme of the Land Acquisition Act, the Government or the Company or the Local Authority, at whose instance the acquisition is made, can question the amount of compensation awarded, where it is vitiated by fraud, corruption or collusion. (Para.4 of the judgment). I am of the view that the above three categories of cases, wherein it is open to the Government or the Company or the Local Authority, at whose instance the acquisition is made, to question the amount of compensation awarded by the Collector is not exhaustive, but only illustrative. The emphasis was only on the very grave or vital infirmities or illegalities. Other serious infirmities can be easily visualised, Eg. where the award is passed mala fide. Every statutory authority is obliged to act bona fide and honestly, and should apply his mind, in the discharge of the duties imposed on him by the statute. Statutory powers must be exercised bona fide, reasonably and without negligence and for the purpose for which they are conferred. (Halbur's Laws of England Third Edition, Volume 30, page 688). This is a vital and fundamental factor. Apart from the three categories mentioned by the Supreme Court (fraud, corruption or collusion) in cases where the amount of compensation awarded is tainted by mala fides - (a kindred infirmity to the three categories pointed by the Supreme Court) it is open to the Government or the Company or the Local Authority, at whose instance the acquisition is made, to question the quantum of compensation. I should say that if the land acquisition authority reopens a concluded award or redetermines the amount of compensation without giving notice to the person who is to pay the compensation amount, it is so done without "due care and attention" and shows a non-application of the mind and so mala fide. (See Ambujam N.Menon v. State of Kerala -1966 K.L.T. 321 (D.B) and also Mammu's case -1965 K.L.T. 1021). On this reasoning, it could be said that the petitioner is entitled to question the amount of compensation awarded by the second respondent. 12. As a result of the above discussion, I hold that the second respondent acted illegally and unauthorisedly in passing Exts.P9 and P10 proceedings without notice and hearing the petitioner. Exts.P9 and P10 violate the principles of natural justice. They are arbitrary and unfair. Exts.P9 and P10 are also against the mandate of Sec.28-A(2) of the Land Acquisition Act, in that, Exts.P9and P10 were passed without notice to the persons interested. I quash Exts.P9 and P10 proceedings. The second respondent is at liberty to dispose of Ext.P7 afresh in accordance with law. 13. The Original Petition is allowed. The petitioner shall be entitled to its costs, including advocate's fee of Rs.1000/-, payable by the first respondent. 14. It was brought to my notice that Exts.P9 and P10 were passed on 26-3-1988 and 28-3-1988, in undue haste by the person who was occupying the office of the second respondent, at that time, and immediately after passing the orders, the incumbent retired from service on 1-4-1988. Counsel for the petitioner suggested that the entire matter is shrouded in suspicion, especially taking into account the fantastic and arbitrary fixation of the compensation amount. This is a very serious allegation and it is a matter which should be probed into by the third respondent, with all seriousness. I dare say that the third respondent will conduct an appropriate enquiry in the matter and do the needful. A copy of this judgment shall be sent, by the Registrar of this Court, to the Chief Secretary to Government (third respondent herein) for appropriate follow-up action in this regard. Allowed.