Supreme Court of India
NAND KISHORE GUPTA & ORS.versusSTATE OF U.P. & ORS.
- Citation
- 2010 INSC 586
- Decided
- 8 September 2010
- Disposal
- Dismissed
- Bench
- V S SIRPURKAR
Holding
The acquisition was for a genuine public purpose under Part II of the Land Acquisition Act, and the State validly invoked the urgency provision, so the High Court’s orders stand.
Summary
The Supreme Court examined the acquisition of land for the Yamuna Expressway project, where the State of Uttar Pradesh, through YEIDA, acquired over 1,600 hectares for an expressway and 25 million square metres for five industrial parcels. Petitioners argued that the acquisition was not for a public purpose, that it was a colourable exercise of power favouring the private concessionaire (J.P. Infatech Ltd), and that the urgency provision under Sections 17(1) and 17(4) of the Land Acquisition Act, 1894, which dispensed with a Section 5A enquiry, was illegal. The Court held that the project served a genuine public purpose—providing a fast‑moving corridor, reducing traffic congestion and fostering industrial development—and that the acquisition was correctly made under Part II of the Act, not Part VII. It also found that the State had sufficient material to justify invoking the urgency clause and dispensing with the Section 5A enquiry. Consequently, the High Court judgments were affirmed and the appeals dismissed.
Issues considered
- The acquisition was for a public purpose within the meaning of Section 3(f) of the Land Acquisition Act, 1894.
- Whether the acquisition should have been made under Part VII (for a private company) rather than Part II of the Act.
- Whether the compensation being paid largely by the private concessionaire negates the public purpose requirement.
- Whether the State could validly invoke the urgency provision under Sections 17(1) and 17(4) and dispense with a Section 5A enquiry.
Legislation cited
- Land Acquisition Act, 1894s. 17(1), s. 17(4), s. 3(f), s. 40, s. 4(1), s. 41, s. 5A, s. 6(1)
- Land Acquisition (Companies) Rules, 1963
- U.P. Industrial Area Development Act, 1976
Subjects
land acquisitionpublic purposeurgency clauseSection 5A enquiryBOT contractYamuna Expresswaycolourable exercise of powerPart II vs Part VIIcompensationeminent domain
Judgment
[2010] 11 S.C.R. 356
A NANO KISHORE GUPTA & ORS.
v.
STATE OF U.P. & ORS.
(Civil Appeal No. 7468 of 2010)
SEPTEMBER 8, 2010
B
[V.S. SIRPURKAR AND CYRIAC JOSEPH, J.J.]
Land Acquisition Act, 1894- s. 4(1) r!w. ss. 17(1) and (4);
s. 6(1) rlw ss. 17(1) and (4); s. 5A and Parts II and VII -
C Acquisition of land on urgent basis for a project of
development and construction of Expressway- Project granted
to a company - Validity of acquisition under Part II and
validity of invoking urgency provision dispensing with enquiry
uls. 5A - Held: acquisition of the land under Part II was correct
o as the same was for the public purpose and was not for a
private company - In the facts and circumstances of the case,
the acquisition cannot be said to be a colourable exercise of
power - The Government only used the company for
implementing its policy - Invocation of urgency provision ul
E s. 17(1) and (4) and dispensing with enquiry uls. 5A was also
necessary in view of the facts of the case - Constitutionalism
- Colourable exercise of power.
In the year 2001 Taj Expressway Industrial
Development Authority [which was later named as
F Yamuna Expressway Industrial Development Authority
(YEIDA)] was constituted under the U.P. Industrial Area
Development Act, 1976, with intent to develop the eastern
side of the river Yamuna by construction of a 6 lane
Expressway joining Noida and Agra. Tenders were
G issued inviting bids from interested parties desirous of
implementing the project. Respondent No.5-company
(the successful bidder) was given the project work.
Concession Agreement was executed between the
parties in 2003. The project was challenged before High
H 356
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 357
ORS.
Court in Public Interest Litigation. Commission of Enquiry A
was also appointed by the State which submitted its
report. Ultimately, the PIL was dismissed by the High
Court.
Thereafter, the notification was issued by the State 8
Government u/s. 4(1) r/w. ss. 17 (1) and 17 (4) of the Land
• Acquisition Act, 1894 for the purpose of the C()nstruction
of the interchange under the Yamuna Expressway Project
through Yamuna Expressway Industrial Development
Authority. Ultimately, the State issued notification u/s. 6(1) C
r/w. ss. 17(1) and 17(4) of the Act. Writ petitions were filed
challenging the acquisition. The High Court dismissed the
writ petitions.
In the instant appeals, the following were the main
questions which arose for consideration: D
1. The acquisition could not be said to be for the
public purpose:
(a) as the object of the acquisition was not
covered by the definition of 'public purpose' in E
Section 3(f) of the Land Acquisition Act, 1894;
(b) the acquisition must be considered to be
under Part VII of the Act and not under Part II,
since it virtually amounted to acquisition of F
land for a private person i.e. respondent No.5;
(c) as the compensation for the land acquisition
was coming wholly from respondent No. 5 and
not from the Government or from YEIDA, it was G
not an acquisition for public purpose;
(d) the acquisition for the so-called interchange
was not at all necessary and it was actually a
colourable exercise of powers.
H
358 SUPREME COURT REPORTS [2010] 11 S.C.R.
A 2. Sections 17(1) and 17(4) of the Land
Acquisition Act were not applicable and,
therefore, the Government could not have
dispensed with the enquiry u/s. 5A of the Act.
B Dismissing the appeals, the Court
HELD: 1.1. The High Court was right in holding that
the acquisition was made for the public purpose. The
High Court has considered the question of public purpose
keeping in mind the correct principles of law. Therefore,
C it cannot be said that the acquisition was not for the
public purpose. [Para 37) [396-A-C]
1.2. The High Court rightly found that the acquisition
was not for the Company but was for the public purpose.
0 The Expressway is a work of immense public importance.
The State gains advantages from the construction of an
Expressway and so does the general public. Creation of
a corridor for fast moving traffic resulting into curtailing
the traveling time, as also the transport of the goods,
E would be some factors which speak in favour of the
Project being for the public purpose. The creation of the
five zones for industry, residence, amusement etc., would
be complimentary to the creation of the Expressway. The
creation of land parcels would give impetus to the
F industrial development of the State creating more jobs
and helping the economy and thereby helping the general
public. There can be no doubt that the implementation of
the Project would result in coming into existence of five
developed parcels/centers in the State for the use of the
citizens. There shall, thus, be the planned development
G of this otherwise industrially backward area. The creation
of these five parcels would certainly help the maximum
utilization of the Expressway and the existence of an
Expressway for the fast moving traffic would help the
industrial culture created in the five parcels. Thus, both
H
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 359
ORS.
will be complimentary to each other and can be viewed A
as parts of an integral scheme. Therefore, it cannot be
said that it is not a public purpose. [Para 30] [386-C-H;
387-A-B]
1.3. It is also to be seen that this was not a case B
where the exercise of power of eminent domain by the
State was for any of the purposes set down in Section
40 of the Act. Further, it is not as if the power of
acquisition was exercised by the State Government for
the work or Project of the Company. Lastly, it is not a case
where the power of exercise was exercised by the State
c
Government so that the acquired land was to belong or
vest permanently in the Company for its own purpose.
The lease was going to be for 90 years after which the
whole land was going to revert back to the State
Government, so also the whole land acquired and used D
actually for the purpose of the highway would also go
back to the State after the period of 36 years, during
which the Company would have the right to levy and
collect the toll. It is not as if a public purpose is relevant
in Part VII, where under Section 39, the previous consent E
of appropriate Government is required for execution of
an agreement between the Government and the
Company. Section 40 of the Act then puts a specific rider
that the State Government shall not give the consent
unless it is satisfied of any of the contingencies F
described in sub-Sections (a), (aa) and (b) thereof. Thus,
even when the acquisition is meant for a Company, the
concept of public purpose has to be at the back of mind
of the acquiring body like Government. [Para 29) [383-H;
384-A-D; 385-8) G
1.4. In the instant case, there is no question of any
agreement with the Company as the three eventualities
described u/s. 40 of the Act are not available for the
simple reason that the basic idea for the acquisition under
H
360 SUPREME COURT REPORTS [2010) 11 S.C.R.
A Part VII of the Act is the total transfer of the ownership of
the acquiring land in favour of the Company. That is
obviously not present. There is no factual background for
holding that any agreement was contemplated in
between the State Government and the Company or for
B that matter, YEIDA and the Company, as envisaged in
Sections 39, 40 and 41 of the Act. There is absolutely no
evidence to suggest that this is an acquisition for the
Company, basically on account of the fact that the
acquired land is not to vest with the Company. This was
C clearly a Project conceived and justified by the State
Government, while the concessionaire was to be chosen
only to implement the Project. The Project was going to
be implemented on the basis of principles of BOT.
Therefore, after the operating period was over, the assets
D of the Project were to be transferred to the State
Government. There was going to be no vesting of land
as in case that if the acquisition was being effected under
Part VII of the Act. The High Court, has correctly come to
the conclusion that the acquisition was not meant only
E for the Company and on that count, it could not be said
that this is not for the public purpose. [Para 29) [385-8-
H]
1.5. It is not correct to say that the Company has paid
the compensation cost and, therefore, the acquisition is
F clearly covered under Part VII of the Act, and there may
be no public purpose if the acquisition is made for the
Company and it is the Company who has to shell out the
whole compensation. Even if it is accepted that all this
compensation is coming from the Company, it should be
G borne in mind that the Company gets no proprietary or
ownership rights over the Project assets. If it is presumed
that the compensation is coming from the Company, then
it will have to be held that the whole assets would go to
the Company. At least that is envisaged in Part VII of the
H Act. In the instant case, that is not the case. The assets
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 361
ORS.
are to revert back to the acquiring body or, as the case A
may be, the Government. Even the lands which are utilized
for the construction of the Expressway are to go back to
the Government barely after 36 years i.e. after the
Company has utilized its rights to recover the toll on the
Expressway. Secondly, it must be, borne in mind that the B
Concession Agreement has been ·executed in February,
2003, whereas the acquisitio'n process started
somewhere in the month of September, 2007. When the
Concession Agreement was executed, the cost factor was
not known. The acquiring body was only to make c
available the land to the concessionaire to implement the
Project. The State Government was to earn Rs.100/- per
hectare for the total acquired land, which was about 25
million square meters over and above the compensation
to be decided. The mention of the compensation amount 0
in addition to the lease money of Rs.100/- per hectare
would clearly provide that the whole compensation was
not going to be paid by the Company alone. This is apart
from the fact that through this agreement, only the extent
of the compensation payable by the Company to YEIDA E
was decided. However, once all the amounts went to the
coffers of YEIDA, it would lose its independent character
as a premium. When it goes into the coffers of YEIDA, it
is the YEIDA who would make the payments of the
estimated compensation and thereby it would be as if the
compensation is paid not by the Company, but by YEIDA. F
[Para 31] [387-C-H; 388-A-F]
1.6. At the time when the Project conceived in 2001,
the present Company was not in existence. It came in
existence only later on. This is an admitted position also. G
Therefore, it cannot be said that the whole Project was
envisaged keeping this Company in view. Besides, and
the fact that a full-fledged enquiry was got done by the
State by constituting a Commission of Enquiry also
cannot be ignored. The said Commission of Enquiry H
362 SUPREME COURT REPORTS (2010] 11 S.C.R.
A submitted its Report in October, 2006 and it was duly
accepted by both the Houses of the Legislature of the
State of Uttar Pradesh. Again, the aspects of the
transparency have been examined by the Division Bench
of the High Court in a P.1.L., which was dismissed by a
B well-considered judgment, which remained
unchallenged. Nobody has so far argued that any
specific partial treatment was offered to the Company nor
has it been pointed out at any stage that there was
anything amiss with the tendering process or that the
c tender of contract to the Company was a foregone
conclusion. Therefore, it cannot be said that this
acquisition was a colourable exercise of power. There
was a full transparency in the whole process and the
whole process was checked, rechecked and re-
D rechecked, leaving no scope to infer any bias in favour
of the Company. [Para 28] [382-G-H; 383-A-D]
State of Karnataka and Anr. vs. All India Manufacturers
Organizationand Ors. 2006 (4) SCC 683; Sooraram Pratap
Reddy and Ors. vs. District Collector, Ranga Reddy District
E and Ors. etc. etc. 2008 (9) sec 552; Pratibha Nema and Ors.
vs. State of M.P. and Ors. 2003 (10) sec 626, relied on.
Smt. Somavanti and Ors. vs. The State of Punjab and
Ors. AIR 1963 SC 151, distinguished.
Naihati Municipality and Ors. vs. Chinmoyee Mukherjee
and Ors. 1996 (10) SCC 632; Dhampur Sugar (Kashipur) Ltd.
vs. State of Uttaranchal and Ors. 2007 (8) SCC 418; Babu
Barkya Thakur vs. State of Bombay AIR 1960 SC 1203;
Pandit Jhandu Lal vs. State of Punjab AIR 1961 SC 343;
G Devinder Singh and Ors. vs. State of Punjab and Ors. 2008(1)
SCC 728; Jage Ram and Ors. vs. State of Haryana and Ors.
1971 (1) SCC 671; Shyam Behari and Ors.vs. State of
Madhya Pradesh and Ors. AIR 1965SC 427, referred to.
·H 2.1. The challenge by the appellants on the ground
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 363
ORS.
that there was no urgency and, therefore, the enquiry ul A
s. 5-A of the Act should not have been dispensed with,
cannot be accepted. The High Court has taken meticulous
care in examining as to whether there was material
before the State Government to dispense with the enquiry
uls. 5A of the Act. In the instant Project, considering the B
various reasons like enormousness of the Project,
likelihood of the encroachments, number of appellants
who would have required to be heard and the time taken
for that purpose, and the fact that the Project had lingered
already from 2001 till 2008, there was necessity to c
dispense with the enquiry uls. 5A of the Act. There is no
reason to take a different view than what is taken by the
High Court. [Paras 39 and 41] [401-F-H; 402-A-D; 403-C]
Tika Ram and Ors. etc. etc. vs. State of UP. and Ors.
D
etc. etc 2009 (10) sec 689, relied on.
Sheikhar Hotels Gulmohar Enclave and Anr. vs. State of
UttarPradesh and Ors. 2008 (14) SCC 716; First Land
Acquisition Collector and Ors. vs. Nirodhi Prakash Gangoli
and Anr. 2002 (4) SCC 160; State of Punjab and Anr. vs. E
Gurdial Singh and Ors. 1980 (2) SCC 471; Om Prakash and
Anr. vs. State of U.P. and Ors. 1998 (6) SCC 1; Babu Ram
and Anr. vs. Sate of Haryana and Anr. 2009 (10) SCC 115;
Manju Lata Agrawal vs. State of UP. and Ors. 2007(9) ADJ
447 (DB); Sudhir Chandra Agrawal vs. State of UP. 2 0 0 8 F
(3) ADJ 289 (DB); Munshi Singh vs. State of UP. 2009 (8)
ADJ 360 (DB); Essco Fabs Pvt. Ltd. and Anr. vs. State of
Haryana and Anr. etc. etc. 2009 (2) SCC 377; Mahender Pal
and Ors. vs. Stateof Haryana and Ors.2009 (14) SCC 281 -
referred to. G
2.2. It is not correct to say that the encroachment
issue was not a relevant factor for dispensing with
enquiry uls. 5A of the Act. In the instant case, the area to
be acquired for the Expressway alone was more than
H
364 SUPREME COURT REPORTS (201 OJ 11 S.C.R.
A 1,600 hectares. This is apart from the 25 million square
meters of land which was liable to be acquired for the
purposes of development of 5 land parcels. There was
interlinking between the acquisition of land for the
highway and the acquisition of land for establishing the
B 5 townships. However, this was not the only factor
considered by the State Government and even the High
Court has not held the same to be the only factor for
dispensing with the enquiry. [Para 40) [402-F-H; 403-A-B]
Om Prakash and Anr. vs. State of UP. and Ors. 1998 (6)
c sec 1, distinguished
Case Law Reference:
2003 (1 O) sec 626 Referred to. Para 31
D 1996 (1 O) sec 632 Referred to. Para 31
2006 (4) sec 683 Relied on. Para 33
2008 (9) sec 552 Relied on. Para 34
2001 (8) sec 418 Referred to. Para 34
E
AIR 1960 SC 1203 Referred to. Para 34
AIR 1961 SC 343 Referred to. Para 35
AIR 1963 SC 151 Distinguished. Para 37
F
2003 (1 O) sec 626 Referred to. Para 37
2008(1 > sec 728 Referred to. Para 37
1911 (1) sec 671 Referred to. Para 37
G AIR 1965SC 427 Referred to. Para 37
2008 (14) sec 716 Referred to. Para 39
2002 (4) sec 160 Referred to. Para 39
H
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 365
ORS.
1980 (2) sec 471 Referred to. Para 39 A
1998 (6) sec 1 Referred to. Para 39
2009 (10) sec 11s Referred to. Para 39
2007(9) ADJ 447 (DB) Referred to. Para 39 8
2008 (3) ADJ 289 (DB) Referred to. Para 39
2009 (8) ADJ 360 (DB) Referred to. Para 39
2009 (2) sec 377 Referred to. Para 39
c
2009 (14) sec 281 Referred to. Para 39
2009 (1 O) sec 689 Relied on. Para 39
1998 (6) sec 1 Distinguished. Para 40
D
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
7468 of 2010.
From the Judgment & Order dated 30.11.2009 of the High
Court of Judicature at Allahabad in Civil Misc. Writ Petition No.
31314 of 2009. E
WITH
C.A. Nos. 7469-7470 of 2010.
Ranjit Kumar, Ratnakar Dash, S.8. Upadhyay, Altaf F
Ahmad, Anurag Sharma, Parshant Kumar, (for AP & J
Chambers, Meenakshi Arora, Poli Kataki, Mohit T.N. Singh,
S.K. Dwivedi, Rajeev K. Dubey, Kamlendra Mishra, Pawan
Upadhyay, Param mishra (for Sharmila Upadhyay), Ravindra
Kumar for the appearing parties. G
The Judgment of the Court was delivered by
V.S. SIRPURKAR, J. 1. This judgment will govern Special
Leave Petition (Civil) Nos. 33194 of 2009, 33958 of 2009 and
35336 of 2009. H
366 SUPREME COURT REPORTS [201 OJ 11 S.C.R.
A 2. Leave granted in all the Special Leave Petitions.
3. In the first two Special Leave Petitions, judgment passed
by the High Court of Judicature at Allahabad dated 30.11.2009,
is in challenge while in the third Special Leave Petition,
B judgment dated 5.10.2009 on the same subject is impugned.
By the impugned judgments, the Writ Petitions filed by the land
owners challenging the notification under Sections 4 and 6 of
the Land Acquisition Act, 1894 (hereinafter called 'the Act' for
short) relating to Yamuna Expressway Project, were dismissed
C by the High Court. In the Writ Petitions, directions were sought,
firstly not to give effect to the notifications issued and further
not to dispossess the landholders/ petitioners after demolishing
their constructions on the lands. which were proposed to be
acquired. All the challenges were repelled by the High Court.
The High Court, in the judgment dated 30.11.2009 passed in
D Civil Misc. Writ Petition No.31314 of 2009 (Nand Kishore
Gupta & Ors. Vs. State of U.P. & Ors.), basically pointed out
that out of 12,282 land owners, 11,397 had already received
their compensation under the agreement and the challenge
related only to 21.03 hectares out of 1,604 hectares of land.
E The High Court also took the view that the scales of justice must
tilt towards the right to development of the millions who will be
benefited from the road and the development of the area, as
against the human rights of 35 petitioners therein, whose main
complaint was that they were not heard before the declaration
F under Section 6 of the Act. The High Court also declined to give
any direction to the State Government to consider to exempt
21.03 hectares of land relating to the 35 petitioners therein on
account of the fact that the construction of the road had to be-
made in an alignment and that alignment could not be changed.
G Identical view was taken in another Writ Petition filed by one
Balbir Singh. The High Court also expressed its concerns that
any direction to exempt the land covered by the construction
might seriously jeopardize the Project. The High Court also
reiterated that the acquisition of the land for interchange of the.
H road was the essential part of the Project, as also the
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 367
ORS. [V.S. SIRPURKAR, J.]
construction of bridges, culverts and interchanges, which were A
essential for the fast moving six lane Expressway.
4. Before we approach the arguments, it would be
interesting to see some facts of this litigation.
5. A notification dated 20.2.2009 was issued by the B
Government of Uttar Pradesh under Section 4(1) read with
Sections 17(1) and 17(4) of the Act. Thereunder, the lands
described in the schedules appended thereto in District Agra,
Pargana Etmadpur, Tehsil Etmadpur, Village Kuberpur were
covered for a public purpose, namely, the construction of the C
interchange under the Yamuna Expressway Project in District
Agra through Yamuna Expressway Industrial Development
Authority (hereinafter called 'YEIDA' for short). In fact, in the year
2001 itself, the State Government had taken a decision for the
construction of Yamuna Expressway which sometimes earlier D
was named as Taj Expressway, which was to proceed from
Greater Neida to Agra. This was to be done on Build, Operate
and Transfer (BOT) basis and the builder was to get the rights
to collect the tolls for a period of 36 years from the date of
commencement of commercial operations. On account of the E
public outcry, the State Government appointed a Commission
of Enquiry under the Chairmanship of Mr. Justice Siddheshwar
Narain (Retd.). A Public Interest Litigation was also filed. The
Project was cleared in the enquiry and the Public Interest
Litigation also ended in favour of the Government of U.P. It is F
on the backdrop of this that the State Government came up with
/a notification dated 20.2.2009, i.e. only after its way was
cleared, which itself took about 8 years. This was the reason
given for making applicable the urgency clause under Sections .
17(1) and 17(4) of the Act. Legal notices were served by those G
who were affected, but ultimately the State came out with a
notification dated 15.6.2009 under Section 6(1) read with
Sections 17(1) and 17(4) of the Act. It is mainly the complaint
of the appellants that they had purchased the land long time
back and their names were duly mutated in the Revenue records
H
368 SUPREME COURT REPORTS [2010] 11 S.C.R.
A and they had thereafter raised constructions over the land in
question, and in those constructions, they were running their
business like shops, cold-storage etc. The appellants also
complained that the area which was proposed to be cleared
for the interchange, if acquired, the appellants would suffer
B immensely. The appellants very seriously challenged the
application of urgency under Sections 17(1) and 17(4) of the
Act to these acquisitions, thereby depriving the appellant& of
an opportunity to be heard under Section 5A of the Act. Even
before us, that is the main thrust of the arguments on behalf of
c the appellants.
6. The other major challenge opposing the acquisition
related to the concept of 'public purpose'. It was tried to be
suggested that this was in fact an acquisition without any public
purpose for the Company-J.P. lnfratech Ltd.-respondent No.5
D and would be covered under Part VII of the Act. In that, the
learned Counsel appearing on behalf of the appellants urged
that there could be no dispensation with enquiry under Section
5A of the Act. It was pointed out that the compensation was
payable by the private party under the scheme and, therefore
E also, this could not be viewed as a public purpose. It was also
suggested that this was virtually a perpetual lease in favour of
the Company and, therefore, the Company was getting deemed
proprietary rights.
F 7. In the two impugned judgments, the Allahabad High
Court has repelled all the challenges. In fact in the earlier round
of litigation that is in the Public Interest Litigation itself the
Division Bench of the Allahabad High Court repelled the
challenges to this Project which was then known as Taj
G Expressway Project and the land acquisition made therefor.
8. Before we approach the questions argued, it will be
better to refer to the judgment of the Allahabad High Court in
the Public Interest Litigation, which, in itself, refers the enquiry
held by Mr. Justice Sidheshwar Narain (Retd.). In fact one of
H the prayers in the Public Interest Litigation was for production
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. &369
ORS. [V.S. SIRPURKAR, J.]
of the Report dated 12.10.2006 of the Commission headed by A
Mr. Justice Narain. The other prayers were to initiate de novo
judicial enquiry by a sitting High Court Judge and further to issue
a Writ of Mandamus declaring the alleged Enquiry Report as
illegal, invalid and ineffective and not enforceable in the eyes
of law and lastly to pass any other Writ, order or direction. This B
Writ Petition- was then amended and the Concession
Agreement dated 7 .2.2003 entered between the Taj
Expressway Authority and the Jaiprakash Industries (hereinafter
called 'the Company' for short) also came to be challenged.
This Taj Expressway Authority was constituted under Section c
3 of the U.P. Industrial Area Development Act, 1996 which later
on was named as Yamuna Expressway Industrial Development
Authority (YEIDA). The petitioners prayed for a declaration that
this agreement was null and void.
9. Another prayer added by way of an amendment was for D
investigation by the special investigation team into the entire
deal of Taj Expressway Project. The High Court in its well
considered judgment, took note of the three challenges by the
petitioners to the said Commission of Enquiry Report. The said
challenges were: E
(1) that the award of contract to the Company was
activated by ma/a fides;
. (2) that the tender process itself was faulty; and
F
(3) that the terms of contract were unconscionable and
against the public interest.
10. All the three challenges were refuted by the Division
Bench of the High Court by referring to the, Report itself which G
was filed before it at the instance of the State Government. It
recorded a finding that there was no ma/a fide on the part of
anybody. The Commission had also come to the conclusion
that the Agreement with the Company was arFived at after
proper scrutiny on the part of the Government Officers and there H
370 SUPREME COURT REPORTS [2010] 11 S.C.R.
A was no ma/a fide on the alleged connection of one Shri Anup
Mishra or his father with the Company. The Division Bench
affirmed this finding. The Division Bench also recorded a
finding that the petitioner therein was not able to place any other
material on record to show that the process itself was faulty or
B that the terms of contract were unconscionable and against the
public interest. While considering the amendment made by the
petitioner to the Writ Petition by which fresh challenges were
thrown against the Agreement dated 7.2.2003, the Division
Bench came to the conclusion that there was no procedural
C infirmity in the contract having been awarded to the Company.
The Division Bench then considered the other challenges
namely:
(1) huge chunks of lands had been given to respondent
No.2 on lease for 90 years at a very nominal lease
D rent.
(2) Exemption of stamp duty has been given to
respondent No.2 causing loss of revenue to the
State exchequer.
E
11. The Division Bench in detail considered the nature of
lease and the nature of the transaction. For that it went on to
analyze the whole Project which had the three objectives,
namely:
F (1) provide a fast moving corridor to minimize travel
time
(2) to connect the main township/ commercial centres
on the Eastern side of Yamuna
G (3) to relieve the National Highway No.2 which was
already congested and ran through the heart of
cities like Faridabad, Ballabhgarh and Palwal."
12. The High Court then discussed the financial
H ramifications resulting out of the Agreement and then after
NAND KISHORE GUPTA & ORS. v. STATE OF U.P. & 371
ORS. [V.S. SIRPURKAR, J.]
referring various judgments of this Court, went on to decide the A
question whether before finalizing the contract in favour of
respondent No. 2 Company, the State Government or the Taj
Expressway Authority had· undertaken the requisite research.
It went on to record a finding as found in the Commission of
Enquiry that the authorities had examined all the aspects of the B
matter before issuing the bid document inviting offers. It also
recorded that there was proper publication of the Notice Inviting
Tender (NIT) in various national Dailies and that 19 parties had
responded to the NITs. The High Court, therefore, recorded a
finding that there was nothing shady and the entire process was c
transparent. The High Court also registered a finding that it
could not be1 said that undue concessions were given to the
Company in view of the fact that all such concessions had
already been spelt out in the bid document. Thus, the High Court
approved of the findings reached in the Commission of Enquiry
0
by Mr. Justice Siddheshwar Narain (Retd.). Ultimately, the High
Court dismissed the Public Interest Litigation.
13. It is on this backdrop that number of Writ Petitions
came to be filed again giving rise to the two impugned
judgments. E
Basically two questions emerge from the arguments made
at the Bar before us. They are:-
The acquisition itself cannot be said to be for the public F
purpose:
(a) as the object of this acquisition is not covered by
the definition of 'public purpose' in Section 3 (f) of
the Land Acquisition Act.
G
(b) it cannot be said that this acquisition would come
under Part II of the Land Acquisition Act and in fact
it must be considered to be under Part VII of the
Act since it virtually amounts to acquisition of land
for J.P. lnfratech-a company(respondent No.5).
H
372 SUPREME COURT REPORTS (2010) 11 S.C.R.
A (c) the compensation for the land acquisition is coming
wholly from the Jaypee Industries and not from the
Government or from YEIDA and, therefore, it is not
an acquisition for public purpose.
(d) the acquisition for so-called interchange is not at all
B
necessary and it is actually a colourable ·exercise
of powers.
2. The application of Sections 17 (1) and 17 (4) of the
Land Acquisition Act was wholly unnecessary and,
c th~refore, illegal,
(a) and, therefore, the Government could not have
dispensed with the enquiry under Section 5 A of the
Aci. .
D 14. Learned Counsel appearing on behalf of the appellants
argued in support of the above two main and the ancillary
questions.
15. As against this, learned Counsel appearing for the
E State as also for the Company and YEIDA supported the
acquisition and contended that it was futile to oppose the
acquisition, particularly, when the acquisition was virtually
accepted by all except a few, inasmuch as the learned Counsel
contended that majority of the landlords have ae!'cepted the
F compensation also and have not challenged th~ acquisition in
any manner. It is only a few extremely insignificant pockets
which are now caught in this litigation. The learned Counsel
have specifically averred that the whole process was extremely
transparent and that there was necessity of this land considering
G the public purpose involved and that all care was taken to
safeguard the interests of the farmers and that the creation of
this Expressway and creation of five townships would
immensely help the general public residing on the Eastern Bank
of Yamuna particularly, and the residents of UP generally. It is
H on these rival contentions that we have to proceed now.
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 373
ORS. [V.S. SIRPURKAR, J.]
16. Since the land acquisition exercise is for the Yamuna A
Expressway Project, it would be worthwhile to see some factual
background thereof. U.P. Industrial Area Development Act,
1976 came into force on 1.4.1976. Section 3 thereof provides
for constituting an authority by a notification. The object of this'
legislation is planned development of certain notified areas in B
the State by building up integrated industrial townships. The
State Government is empowered thereunder to declare the
industrial development area and this Act empowers the
authority to acquire the land by direct purchase or through State
(under the provisions of the Land Acquisition Act, 1894). It also c
requires preparing a Master Plan, to demarcate the sites into
industrial, commercial, institutional, residential and other land
use in accordance with the Master Plan. Under Section 7 of
the said Act, the authority is empowered to allot its properties,
by way of lease br otherwise, on such terms and conditions as
0
it may deem flt. An authority called Taj Expressway Industrial
Development Authority came to be constituted under this Act
by a Notification dated 24.4.2001. This Authority changed its
nomenclature and became Yamuna Expressway Industrial
Development Authority ('YEIDA' for short) vide Notification
dated 11.7.2008. This was with intent to develop the Eastern
E
Side of the river Yamuna by construction of a 6 lane
Expressway joining Noida to Agra and also for development
of five regions along the said Expressway into a planned
industrial development area for residential, industrial,
institutional or recreational purposes. The industrial F
development area was also notified on 24.4.2001, which then
comprised of 8 villages. Later on, vide notification dated
22.8.2001, as many as 63 No. of villages including the village
of some of the appellants were also included. By further
notifications, some more villages were also notified as part of G
industrial development area. The area was in 4 districts,
namely, Gautam Budh Nagar, Agra, Mathura and Aligarh.
17. After the constitution of the Authority (YEIDA), public
notices for global tenders were issued in 2001 inviting bids from H
374 SUPREME COURT REPORTS [2010] 11 S.C.R.
A interested parties desirous of implementing the Project of the
said 6 lane Expressway and the building of the townships on
Build, Operate and Transfer model. This Project, however, did
not proceed, as there was no eligible bidder and ultimately, the
selection process was dropped. Subsequently, in November,
B 2002, fresh bids were invited on the same principles, but with
an option either to enter into a joint venture (JV) with the YEIDA
or to implement the said Project without any equity partition of
the said Authority. In the Bid Document, the necessity of the
major highway connecting New Delhi with Mathura and Agra
c was reiterated with the objectives {i) to provide a fast moving
corridor to minimize the travel time, (ii) to connect the main
townships/commercial centres on the Eastern Side of Yamuna,
and (iii) to relieve NH-2 which was already congested and ran
through the heart of cities like Faridabad, Ballabhgarh and
D Palwal. It was informed to the interested parties that the
proposed Expressway was to be about 160 Kms. in length
shortening the distance between Noida and Agra with an
estimated cost of US $ 350 million. It was also informed that
the Expressway was to pass through virgin area along the river
Yamuna and that a band of 500 meters width of land at five or
E more locations, of which one location was to be in Noida or
Greater Noida area along the Expressway, would be offered
on acquisition cost along the corridor as an integral part of the
Project. It was further informed that in addition to the land for
Expressway, 25 million square meters land along the same
F would be given at acquisition cost for development of the same
for commercial, amusement, industrial, institutional and
residential purpose. Bids were invited from all the interested
parties having experience in the construction/development of
infrastructure Projects including real estate development and
G it was informed that the selected developer would be offered
25 millions square meters of land for development on
acquisition cost on lease for a period of 90 years. It was also
informed that the concession period would be for 7 years from
the date of signing of the Concession Agreement and all the
H assets related to the Expressway were to stand transferred on
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 375
ORS. [V.S. SIRPURKAR, J.]
the date of signing of the Concession Agreement in favour of A
such a successful bidder. The Bid Document also provided that
the successful bidder would have the right to levy, collect and
retain toll from the public using the Expressway during the
concession period. Tender of Jaiprakash Industries Ltd. was
accepted and thus they became the successful bidder as they B
had claimed the lowest concession period of 36 years.
18. The Concession Agreement dated 7.2.2003 also came
to be executed between the parties. However, before the work
could start, the whole Project got stuck up in the litigation, upon C
which the Enquiry Commission was appointed by the State
Government under the Chairmanship of Mr. Justice
Siddheshwar Narain (Retd.). Before that, two Commissions of
sub enquiries were constituted. While the Report of the first
Commission was quashed by the Allahabad High Court, the
second Commission of Enquiry could not proceed at all, as the D
Members had resigned. Ultimately, Mr. Justice Siddheshwar
Narain (Retd.) completed the enquiry and submitted his Report
in October, 2006. Thereafter, as has already been pointed out
earlier, a Public Interest Litigation came to be filed by way of a
Writ Petition before the Allahabad High Court, which was E
dismissed by the Allahabad High Court. It was thereafter that
the process of land acquisition commenced in September,
2007. In the first phase, land for Expressway was acquired.
Subsequently, the acquisition process started for the land for
development. The first Writ Petition being Civil Misc. Writ F
Petition No. 48978 of 2008 came to be filed by one Balbir
Singh, challenging the Notification dated 15.10.2007 issued
under Section 4 of the Act, as also the Notification dated
4.1.2008 issued under Section 6 of the Act. Status quo order
was passed on the said Writ Petition. On its heels, other Writ G
Petitions were filed, the main Writ Petition being Civil Misc. Writ
Petition No. 31314 of 2009 filed by one Nand Kishore Gupta.
The status quo orders were passed even in that Writ Petition.
Ultimately, the Writ Petition of Balbir Singh was dismissed by
a judgment dated 5.10.2009 and that of others including Nand H
376 SUPREME COURT REPORTS [2010] 11 S.C.R.
A Kishore's came to be dismissed on 30.11.2009. It is on this
historical backdrop that we have now to consider the
correctness or otherwise of these two judgments, which pertain
to, more or the less, same subject, but with slight variation.
19. The Writ Petition filed by Balbir Singh proceeded, inter
8
alia, on the grounds that acquisition was a colourable exercise
of power and was one which should have been accomplished
by complying with the provisions of Part VII of the Act as this
was an acquisition for company. By the judgment dated
C 5.10.2009, the High Court dismissed the Writ Petition holding
that (a) the entire process of acquisition was in accordance
with the provisions of the Act and this was not a colourable
exercise of powers, {b) the land in instant case was indeed
acquired for public purpose, namely, construction of Yamuna
Expressway Project, (c) the land was not acquired for company
D and as such the procedure under Chapter VII was not
applicable.
It was also urged in that case that the entire cost of the
acquisition was to be borne by the Company and the Company
E had to pay the entire dues towards acquisition cost and,
therefore, there was no public purpose in this acquisition and
the so-called public purpose appearing in the Notification was
a camouflage. It was further urged that since even a part of
compensation was not coming from the Government out of the
F public revenue or some fund controlled by the local authority,
this acquisition was not for the public purpose. In Balbir Singh's
case, all these objections were dismissed.
20. More or the less, same contentions with some
difference were raised in Nand Kishore's case also, the
G judgment which also disposed of the Civil Misc. Writ Petition
No. 50474 of 2009 (Raja Devi & Ors. Vs. State of U.P. & Ors.),
Civil Misc. Writ Petition No. 35090 of 2009 (J.S. Horticulture
Pvt. Ltd. Vs. State of U.P. & Ors.), Civil Misc. Writ Petition No.
51537 of 2009 (Bhupendra Singh & Ors. Vs. State of U.P. &
H Ors.), Civil Misc. Writ Petition No. 51543 of 2009 (Mukesh
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 377
ORS. [V.S. SIRPURKAR, J.]
Singh Vs. State of U.P. & Ors.), Civil Misc. Writ Petition No. A
51546 of 2009 (Vijay Singh & Anr. Vs. State of U.P. & Ors.),
Civil Misc. Writ Petition No. 51551 of 2009 (Jagvir Singh &
Ors. Vs. State of U.P. & Ors.), Civil Misc. Writ Petition No.
60587 of 2009 (Kadival Infrastructure Pvt. Ltd. & Anr. Vs.
State of U.P. & Ors.) alongwith the main Writ Petition being B
Civil Misc. Writ Petition No.31314 of 2009 (Nand Kishore
Gupta & Ors. Vs. State of U.P. & Ors.). The individual
grievances raised in all these Writ Petitions were dealt with and
the challenges were rejected. The two main points, as culled
out by us, were dealt with as in Balbir Singh's case.
c
21. Insofar as the individual grievances are concerned, they
were mostly in the nature of plea regarding the constructions
having been there in this land required for interchange. For
example, in Nand Kishore Gupta's case, it was claimed that
there was cold storage of the petitioner No. 1 therein and shops D
in cold storage, a temple in plot No. 139, a weigh bridge
(Dharm Kanta) on plot No. 122 and some of the plots were
owned by Trishul Awas Sahkari Awas Samiti. It was stated in
Civil Misc. Writ Petition No. 50474 of 2009 (Rajo Devi & Ors.
Vs. State of U.P. & Ors.) that the petitioners had a house and E
a boundary wall on some Khasras and some constructions on
the others. In Civil Misc. Writ Petition No. 35090 of 2009 (J.S.
Horticulture Pvt. Ltd. Vs. State of U.P. & Ors.), it was urged that
there was a 1O'X11' high boundary wall and constructed rooms
inside a 'Goshala' and 3 tube wells with several trees. In Civil F
Misc. Writ Petition No. 51537 of 2009 (Bhupendra Singh & Ors.
Vs. State of U.P. & Ors.), it was urged that this was an
agricultural land and the petitioners therein depended on the
same for their livelihood. In still other Writ Petitions being Civil
Misc. Writ Petition No. 51543 of 2009 (Mukesh Singh Vs. State G
of U.P. & Ors.), Civil Misc. Writ Petition No. 51546 of 2009
(Vijay Singh & Anr. Vs. State of U.P. & Ors.) and Civil Misc.
Writ Petition No. 51551 of 2009 (Jagvir Singh & Ors. Vs. State
of U.P. & Ors.), the same plea of cultivation was raised. In Civil
Misc. Writ Petition No. 60587 of 2009 (Kadival Infrastructure H
i
378 SUPREME COURT REPORTS [201 OJ 11 S.C.R.
A Pvt. Ltd. & Anr. Vs. State of U.P. & Ors.), the petitioners
claimed that they had purchased 7 plots with the total area of
24060 sq. meters and they were plots for industrial purposes
and that the plot of Yashoda Devi was a fertile land.
22. The High Court has refuted all these contentions by
8 giving good reasons. We will not go into these individual cases
once the High Court has decided not to entertain these plea
and, in our opinion, correctly. After all, this was an acquisition
for building up a highway and the abovementioned Writ
Petitions pertained to the land required for interchange. It is
C obvious that the alignment of the highway cannot be changed,
as its design has been prepared after consideration of so
many factors by the experts in building the road. Its direction
or alignment, therefore, cannot be changed, with the result, the
area which is required for interchange, also cannot be changed.
D This is a typical example of the individual having to sacrifice
his land for the public good. There can be no dispute that this
road would add to the betterment of the citizens of the East
Yamuna area in particular and Uttar Pradesh in general. This
is apart from the fact that the majority of the persons whose
E lands have been acquired, have either not objected to it or have
accepted the compensation without any demur. It will, therefore,
not be possible for us to go into these individual grievances,
which have been rightly rejected by the High Court. In fact, in
Balbir Singh's case, it was pointed out that out of the 12,315
F affected farmers in 133 villages over the total area of 1,638
hectares of the Expressway, 11387 have already received
compensation and only 142 farmers have raised the issues.
The High Court has rightly held that the private interest is always
affected to some extent in such large schemes requiring the
G acquisition of land. The High Court has rightly held that a holistic
view had to be taken to look for an all round development
without forgetting about our heritage, culture and traditions. We
also, therefore, would not entertain the objections, feebly raised
before us, individually.
H
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 379
ORS. [V.S. SIRPURKAR, J.]
23. We have now to see as to whether the challenge posed A
by the appellants herein about this acquisition not being for
public purpose is justified or not. Shri Ranjit Kumar, Shri Debol
Banerjee, learned Senior Counsel and Ms. Meenakshi Arora,
learned Counsel appearing on behalf of the appellants,
vehemently urged that this acquisition, in the first place, is B
colourable exercise of power. All the learned Counsel urged that
the very nature the whole transaction showed was that the whole
acquisition was tailor made for the respondent Company. The
learned Counsel further urged that it was meant only for the
benefit of the Company, inasmuch as, though the acquisition c
should have been made under the provisions of Part VII of the
Act, it was carried out in terms of the provisions of the Part II of
the Act, citing this to be an acquisition for public purpose.
According to the learned Counsel, there already existed a road
which was a functional road and Yamuna Expressway is only
0
an excuse to develop the feeder road to connect the five
proposed townships. The learned Counsel urged that the huge
land of 25 million square meters has virtually been handed over
to the respondent Company on a platter and, therefore, all this
exercise was clearly not for the public purpose. It was further E
urged that the so-called Concession Agreement dated 7.2.2003
was one-sided, inasmuch as, even if it was terminated, the land
which was given to the Company for development, would have
remained unaffected. It was further urged that considering the
length of the lease period of 90 years, the land was virtually
given to the Company for ever, and it was nothing but F
transferring the same in favour of the Company. It was then
pointed out that it was only the Expressway which would revert
back to the Government -after 36 years, but not the land
measuring about 25 million square meters, which would be
wholly managed by the Company. In fact, the learned Counsel G
argued that this cannot be said to be an integrated Project, as
the land for Expressway and the land for development have
been treated on an entirely different and unequal footing. It was
also pointed out that the present purpose was not a public
purpose as envisaged in Section 3(f) of the Act. The learned H
380 SUPREME COURT REPORTS [2010] 11 S.C.R.
A Counsel pointed out that from the Agreement itself, it is clear
that the entire cost of the acquisition is going to be borne by
the Company and, therefore, there can be no doubt that the
acquisition is for the Company and not for the public purpose.
The learned Counsel argued that merely because the Company
B has paid the entire cost of acquisition alongwith Rs.100/- per
hectare per year by way of premium, it cannot be denied that
it is only the private respondent who is bearing the entire cost
of the acquisition and the State Govemment/YEIDA has not
contributed anything. Heavily relying on the decision in Pratibha
c Nema & Ors. Vs. State of M.P. & Ors. [2003 (10) SCC 626],
the learned Counsel argued that this issue needs to be
addressed by this Court on the backdrop of this case.
24. As against this, the learned Counsel appearing on
behalf of the State, as also for the Company and YEIDA, pointed
D out that this cannot be said to be a colourable exercise of power.
They also pointed out that there cannot be any dispute about
the utility of this Project and its benefits to the public. They
further pointed out that the whole process has been extremely
transparent. They also pointed out that this acquisition cannot,
E under any circumstances, come within Part VII of the Act. The
learned Counsel further pointed out that the five developed
parcels of the land were going to revert to the acquiring body
after 90 years, and the period of 90 years cannot provide a
permanency to the whole transaction. The learned Counsel
F urged that the State ultimately was going to receive a 6 lane
Expressway which was 160 Kilometers long alongwith five
developed parcels of land on the Eastern Side of Yamuna river.
The learned Counsel also pointed out that all this was going to
help the industrialization and the overall development of that
G area in particular and the State in general, apart from the fact
that this highway would reduce the traffic congestion presently
felt on N.H.-2. The learned Counsel pointed out that it will also
release the congestion, as it exists in the cities and would help
smooth movement of people, goods and material.
H
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 381
ORS. [V.S. SIRPURKAR, J.]
25. The learned Counsel also urged that the creation of A
five planned parcels of land under the Scheme would immensely
help the trading activities in the State and would be extremely
useful for the citizens. The learned Counsel further pointed out
that the land would be put to the industrial, commercial,
residential, amusement or institutional purposes which would B
ultimately serve the public purpose. Lastly, on this question, the
learned Counsel urged that it was a misnomer to say that the
compensation was coming only from the private coffers of the
Company. The learned Counsel also referred to the nature of
the agreement i.e. the BOT contract. The contention raised was c
that a BOT contract, by its nature cannot be equated to or with
an acquisition for a Company. According to the learned
Counsel, all that the Government was doing was merely
choosing a third party agency to implement the work of building,
designing, financing or running the Project, and that the
0
Government was utilizing the expertise and enterprise of a third
party.
26. Our attention was also invited to two decisions of this
Court concerning the BOT contracts and the allegations made
relating to them. The decisions were State of Kamataka & Anr. E
Vs. All India Manufacturers Organization & Ors. [2006 (4)
SCC 683] and Sooraram Pratap Reddy & Ors. Vs. District
Cof/ector, Ranga Reddy District & Ors. etc. etc. [2008 (9) SCC
552].
F
27. The first and foremost thing which we must keep in
mind while deciding these matters is that at least in the present
two matters (Balbir Sing h's case decided on 5.10.2009 and
Nand Kishore's case decided on 30.11.2009), the subject
related only to the acquisition of few hectares of land as G
compared to the acquisition of large chunk which has not been
challenged. Further, it is an admitted position that majority of
the acquisition proceedings are over. In Balbir Singh's case
also, the persons who challenged the Project, were 9 in
number, owning about 7.09 hectares of land i.e. about 0.42%
H
382 SUPREME COURT REPORTS [201 OJ 11 S.C.R.
A of the total land. It has been strongly argued on behalf of the
State, the Company and YEIDA that the major activity of land
acquisition process is over. It has been noted in Balbir Singh's
case that out of the 12,315 affected farmers in 133 villages over
the total area of 1,638 hectares of the Expressway, 11387 have
B already received compensation and only 142 farmers out of
such a large number of villages have raised the issues, leaving
139 farmers who had not taken the compensation. This is apart
from the fact that only 9 Writ Petitioners came in that \Nrit
Petition. The story in Nand Kishore's Writ Petition which was
c disposed of by the High Court alongwith other Writ Petitions is
no different. The learned Counsel appearing on behalf of the
appellants could not deny the fact that the total number of
petitioners concerned in these acquisition proceedings, coming
up before the High Court, was extremely insignificant as
compared to those who had accepted the compensation. Of
0
course, that by itself may not be the only reason to hold against
the appellants (petitioners), however, that fact will have to be
kept in mind while deciding the issues which cover the whole
acquisition process, which acquisition is for the purpose of
development of 25 million square meters of land. The High
E Court has also noticed this aspect. We have mentioned this
aspect only with a limited objective of showing that the criticism
against the whole scheme which would invalidate the
acquisition would be difficult to be accepted, particularly in this
case, in view of the fact that majority of the land owners have
F parted with possession, taken the compensation and thus, the
whole scheme has progressed to a substantial level, wherefrom
it will be extremely difficult now to turn back to square one.
28. We must point out that at the time when the Project
G conceived in 2001, the present Company was not in existence.
It came in existence only later on. This is an admitted position
also. Therefore, it cannot be said that the whole Project was
envisaged keeping this Company in view. That would be the
first reason to reject the argument that the whole scheme was
H a result of colourable exercise of power. We also cannot ignore
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 383
ORS. [V.S. SIRPURKAR, J.]
the fact that a full-fledged enquiry was got done by the State A
by constituting a Commission of Enquiry under the
Chairmanship of Mr. Justice Sidheshwar Narain. The said
Commission of Enquiry submitted its Report in October, 2006
and it was duly accepted by both the Houses of the Legislature
of the State of Uttar Pradesh. Again, we also cannot ignore B
that the aspects of the transparency have been examined by
the Division Bench of the Allahabad High Court in a P.l.L., which
was dismissed by a well-considered judgment, which remained
unchallenged. We have already made reference to that
judgment. Nobody has so far argued that any specific partial c
treatment was offered to the Company nor has it been pointed
out at any stage that there was anything amiss with the
tendering process or that the tender of contract to the Company
herein was a foregone conclusion. We, therefore, cannot
subscribe to the contention that this acquisition was a
D
colourable exercise of power. We must say that there was a
full transparency in the whole process and the whole process
was checked, rechecked and re-rechecked, leaving no scope
to infer any bias in favour of the Company.
29. It was pointed out that initially the award was preceded E
by issuance of an advertisement in the leading newspapers
throughout the country. It was also pointed out that the offers
were invited on the basis of a global tender and as many as
19 parties entered the fray, and that it is only thereafter that
the present respondent Company was chosen for the award F
of the tender. Again, the essential features of the transaction
appear to be that (i) Project was to be implemented on the
Build Operate and Transfer model, (ii) Project conceived of the
construction of the Expressway as well as development of land
parcels at five different locations and (iii) the land for G
development was to be provided to· the selected bidder on a
lease of 90 years upon payment of acquisition cost and
necessary lease rentals. There was, thus, a complete
transparency in the whole affair. It is also to be seen that this
was not a case where the exercise of power of eminent H
384 SUPREME COURT REPORTS [2010] 11 S.C.R.
A domain by the State was for any of the purposes set down in
Section 40 of the Act. Further, it is not as if the power of
acquisition was exercised by the State Government for the work
or Project of the Company. Lastly, it is not a case where the
power of exercise was exercised by the State Government so
B that the acquired land was to belong or vest permanently in the
Company for its own purpose. It was pointed out that the lease
is going to be for 90 years after which the whole land is going
to revert back to the State Government, so also the whole land
acquired and used actually for the purpose of the highway
c would also go back to the State after the period of 36 years,
during which the Company would have the right to levy and
collect the toll. It is not as if a public purpose is relevant in Part
VII, where under Section 39, the previous consent of
appropriate Government is required for execution of an
agreemert between the Government and the Company.
0
Section 40 of the Act then puts a specific rider that the State
Government shall not give the consent unless it is satisfied of
any of the contingencies described in sub-Sections (a), (aa)
and (b) thereof, which are as under:-
E 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,-
F
(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
G (aa) that such acquisition is needed for the construction
of some building or work for a Company which is
engaged or is taking steps for engaging itself in any
industry or work which is for a public purpose, or
H (b) that such acquisition is needed for the construction
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 385
ORS. [V.S. SIRPURKAR, J.]
of some work, and that such work is likely to prove ~
useful to the public.
This would suggest that even when the acquisition is meant
for the Company, the concept of public purpose has to be at
the back of mind of the acquiring body like Government. Here, B
of course, there is no question of any agreement with the
Company as the three eventualities described under Section
40 of the Act are not available for the simple reason that the
basic idea for the acquisition under Part VII 01· the Act is the
total transfer of the ownership of the acquiring land in favour of C
the Company. That is obviously not present here. We do not
see any factual background for holding that any agreement was
contemplated in between the State Government and the
Company or for that matter, YEIDA and the Company, as
envisaged in Sections 39, 40 and 41 of the Act. It was tried to
be canvassed before us that there would be a difference in D
concepts of a public purpose and the work useful to the public.
We are not much impressed by this argument in view of the
fact that there is absolutely no evidence to suggest that this is
an acquisition for the Company, basically on account of the fact
that the acquired land is not to vest with the Company. This was E
clearly a Project conceived and justified by the State
Government, while the concessionaire was to be chosen only
to implement the Project. The Project was going to be
implemented on the basis of principles of BOT. Therefore, after
the operating period is over, the assets of the Project were to F
be transferred to the State Government. There was going to be
no vesting of land as in case that if the acquisition was being
effected under Part VII of the Act. We, therefore, do not accept
the argument that this was either a colourable exercise of power
or was meant for the Company. We are not impressed by the G
argument that this was an acquisition for the Company. The
High Court, in Balbir Singh's judgment, has correctly come to
the conclusion that this acquisition was not meant only for the
Company and on that count, it could not be said that this is not
for the public purpose. The learned Counsel, however, H
386 SUPREME COURT REPORTS [2010] 11 S.C.R.
A vehemently argued that the whole compensation had come
from the Company and, therefore, this acquisition cannot be
said to be for a public purpose. We shall tackle this point a little
later. However, before we proceed to do that, we must express
on the utility of the Expressway, which was conceived, as also
s the development of five parcels of land.
30. During the debate, our attention was invited to Section
3(f) of the Act, which contains a definition for 'public purpose'.
It was pointed out that where the acquisition is for the Company,
it cannot amount to a public purpose. There can be no dispute
C about this proposition that where the acquisition of land is for
the companies, it cannot amount to a public purpose. It was,
therefore, our endeavour to find out whether this land was for
the Company and we are quite satisfied with a finding recorded
by the High Court that this acquisition was not for the Company
D but was for the public purpose. The Expressway is a work of
immense public importance. The State gains advantages from
the construction of an Expressway and so does the general
public. Creation of a corridor for fast moving traffic resulting into
curtailing the traveli.ng time, as also the transport of the goods,
E would be some factors which speak in favour of the Project
being for the public purpose. Much was stated about the 25
million square meters of land being acquired for the five parcels
of land. In fact, in our opinion, as has rightly been commented
upon by the High Court, the creation of the five zones for
F industry, residence, amusement etc., would be complimentary
to the creation of the Expressway. It cannot be forgotten that
the creation of land parcels would give impetus to the industrial
development of the State creating more jobs and helping the
economy and thereby helping the general public. There can be
G no doubt that the implementation of the Project would result in
coming into existence of five developed parcels/centers in the
State for the use of the citizens. There shall, thus, be the planned
development of this otherwise industrially backward area. The
creation of these five parcels will certainly help the maximum
H utilization of the Expressway and the existence of an
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 387
ORS. {V.S. SIRPURKAR, J.]
Expressway for the fast moving traffic would help the industrial A
culture created in the five parcels. Thus, both will be
complimentary to each other and can be viewed as parts of an
integral scheme. Therefore, it cannot be said that it is not a
public purpose.
B
31. We must, at this stage, take into account the argument
that the whole compensation is coming wholly from the
Company and not from the Government or from YEIDA. The
appellants invited our attention to Clause 4.1 (d) of the
Concession Agreement. On that basis, it was argued that the C
Company has paid the compensation cost and, therefore, the
acquisition is clearly covered under Part VII of the Act, and
there may be no public purpose if the acquisition is made for
the Company and it is the Company who has to shell out the
whole compensation. Now, this argument is clearly incorrect.
Even if we accept for the sake of argument that all this D
compensation is coming from the Company, we must firstly
bear it in mind that the Company gets no proprietary or
ownership rights over the Project assets. Now, if it is presumed
that the compensation is coming from the Company, then it will
have to be held that the whole assets would go to the Company. E
At least that is envisaged in Part VII of the Act. Here, that is
not the case. The assets are to revert back to the acquiring body
or, as the case may be, the Government. Even the lands which
are utilized for the construction of the Expressway are to go
back to the Government barely after 36 years i.e. after the F
Company has utilized its rights to recover the toll on the
Expressway. Secondly, it must be borne in mind that the
Concession Agreement has been executed in February, 2003,
whereas the acquisition process started somewhere in the
month of September, 2007. When the Concession Agreement G
was executed, the cost factor was not known. The acquiring
body was only to make available the land to the concessionaire
to implement the Project. There would be number of difficulties
arising, as for example, it would be clearly not contemplated
that the land would be made available without any value or that H
388 SUPREME COURT REPORTS [2010] 11 S.C.R.
A there would no scheme for the State Government for recovering
the expenses that it would incur in obtaining the land. The
learned Counsel appearing for the State as also for the
Company and YEIDA argued that in order to overcome and iron
out such difficulties, the Agreement provides that the land would
B be leased on a premium equivalent to the acquisition cost. This
argument proceeds on the basis of Clause 4.3 C of the
Concession Agreement. It is to be noted then that the premium
of the land was not going to be just the acquisition cost, but
also the lease rent of Rs.100/- per hectare. Therefore, the State
c Government was to earn Rs.100/- per hec~are for the total
acquired land, which was about 25 million square meters over
and above the compensation to be decided. The mention of
the compensation amount in addition to the lease money of
Rs.100/- per hectare would clearly provide that the whole
compensation was not going to be paid by the Company alone.
0
This is apart from the fact that through this agreement, only the
extent of the compensation payable by the Company to YEIDA
was decided. However, once all the amounts went to the coffers
of YEIDA, it would lose its independent character as a
premium. When it goes into the coffers of YEIDA, it is the YEIDA
E who would make the payments of the estimated compensation
and thereby it would be as if the compensation is paid not by
the Company, but by YEIDA. The respondents have relied on
the law laid down in Pratibha Nema's Case [cited supra], more
particularly, paragraphs 24 and 25 therein. The respondents
F also argued relying upon the decision in Naihati Municipality
& Ors. Vs. Chinmoyee Mukherjee & Ors. [1996 (10) SCC
632]. The respondents argued that the law laid down in Pratibha
Nema's Case (cited supra) emanates from the judgment in
Naihati Municipality & Ors. Vs. Chinmoyee Mukherjee & Ors.
G (cited supra).
32. Two judgments in State of Karnataka & Ors. Vs. All
India Manufacturers Organization & Ors. [cited supra] and
Sooraram Pratap Reddy & Ors. Vs. District Collector, Ranga
H
NANO KISHORE GUPTA & .ORS. v. STATE OF U.P. & 389
ORS. [V.S. SIRPURKAR, J.]
Reddy District & Ors. etc. etc. (cited .supra) were pressed in A
service by the respondents.
33. The first judgment in State of Kamataka & Ors. Vs. All
India Manufacturers OrganizatiQn & Ors. (cited supra) pertain
to Bangalore-Mysore Infrastructure. Corridor Project). While B
considering what the public purpose was, this Court in
.paragraphs 76, 77, 78 and 79 took stock of the contention,
whereby it was suggested that land far away from the actual
alignment of the road and periphery had been acquired and,
therefore, even ifthe implementation.of the highway Project was c
assumed to be for the public purpose, the acquisition of the land
far away therefrom would not amount to ,a publfc purpose nor
would it be covered by the.provisions of the Kamataka Industrial
Areas Development Act, 1966 (KIAD Act). In the present case
also, it was argued that the lands which are being acquired for
0
the interchange would not at all be necessary. Further, it was
argued that the five parcels of land which is being acquired for
the development of five industrial townships, could n0t be said
for the public purpose nor could it be .said to be .a part of the
present integrated scheme. This Court had refuted this E
argument holding that even in case of Bangalore-Mysore
highway Project, the lands even little away from the main
alignment of the road, had to be a part of this Project and the
Project was an integrated infrastructure development Project
and not merely a highway Project. It was conceived originally
as the Bangalore-Mysore Infrastructure Corridor Project, which F
conceived of the development of roads between Bangalore and
Mysore, for which there were several interchanges in and
around the periphery of the city of Bangalore, together with
numerous developmental infrastructure activities alongwith the
highway at several points. The situation is no different in the G
present case. Therefore, the contention that this acquisition was
not for public purpose, is rejected.
34. In Sooraram Pratap Reddy & Ors. Vs. District
Collector, Ranga Reddy District & Ors. etc. etc. (cited supra), H
390 SUPREME COURT REPORTS [201 OJ 11 S.C.R.
A same question cropped up which has been mentioned in
Paragraphs 9, 1O and 11 of the judgment suggesting that there
was no public purpose and in fact, it was an acquisition for a
private Company under Part VII of the Act and, therefore, the
power of eminent domain would have no application to such
B case. The contentions raised in that judgment in paragraphs
16, 17 and 18 are almost similar to the contentions raised
herein. The Court has extensively dealt with the question of
public purpose in paragraph 66 and has taken stock of
practically all the cases till paragraph 109 therein. It will not be
c necessary for us to repeat all the case law and the questions
raised and considered in these paragraphs, such as industrial
policy of the State, acquisition for Company etc. In fact, while
considering the contention regarding the industrial policy of the
State, the Court has taken into consideration the oft-quoted
case of Dhampur Sugar (Kashipur) Ltd. Vs. State of
0
Uttaranchal & Ors. [2007 (8) SCC 418], where this Court has
come to the conclusion that in the absence of illegality or
violation of law, a Court of law will not interfere in the policy
matters. Similar is the case here, where the development of the
industrial infrastructure along the Expressway for the overall
E betterment of the region and further for the industrialization of
the otherwise backward region of Uttar Pradesh, was
considered as a policy. In this judgment again, the Court has
extensively considered the question as to whether and under
what circumstances, the acquisition could be said to be the
F acquisition for the Company. In that, the Court has also
considered the decision in Babu Barkya Thakur Vs. State of
Bombay [AIR 1960 SC 1203]. The Court quoted the
observations in the aforementioned decision in Babu Barkya
Thakur Vs. State of Bombay (cited supra) to the following
G effect:-
"These requirements indicate that the acquisition for a
Company also is in substance for a public purpose
inasmuch as it cannot be seriously contended that
H constructing dwelling houses, and providing amenities for
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 391
ORS. [V.S. SIRPURKAR, J.]
A
the benefit of the workmen employed by it and construction
of some work of public utility do not serve a public
purpose."
We have already considered this question that in the
present case, there is nothing to indicate that the acquisition B
is for the Company i.e. for Jaiprakash Industries Ltd. It is only,
therefore, that we are at pains to point out that the Government
was only using the Company for implementing its policy.
35. In the aforementioned judgment of Sooraram Pratap C
Reddy & Ors. Vs. District Collector, Ranga Reddy District &
Ors. etc. etc. (cited supra), Hon'ble Thakker, J. has also referred
to the decision in Pandit Jhandu Lal Vs. State of Punjab [AIR
1961 SC 343], where the acquisition was for coristruction of
houses by members of Thapar Industries Cooperative Housing
Society Ltd., Yamuna Nagar. The challenge was that there was D
non-compliance of the provisions of Part VII of the Act, though
the acquisition was for the Company under Part VII of the Act.
The High Court, in that case, held that the acquisition was for
a public purpose and there was no need to comply with the
provisions of Part VII of the Act. In fact, practically all the E
decisions on the subject of acquisition for the Company and
public purpose have been considered in this judgment of
Sooraram Pratap Reddy & Ors. Vs. District Collector, Ranga
Reddy District & Ors. etc. etc. (cited supra), which itself is a
locus classicus. Ultimately, this Court came to the conclusion F
that the acquisition made by the State of Andhra Pradesh could
not be faulted, as it was in pursuance of policy decision for
development of the city of Hyderabad and in pursuance of that
policy, an integrated Project was taken up for development of
the city of Hyderabad into a business-cum-leisure tourism G
infrastructure centre. The Court also came to the conclusion
that the Andhra Pradesh Infrastructure and Investment
Corporation (APllC) in the reported decision was a nodal
agency like YEIDA in the present case which was to generate
the revenue and help the development of infrastructure for H
392 SUPREME COURT REPORTS [201 OJ 11 S.C.R.
A industrialization of the area. The Court also recognized that
such instrumentality of State would have the power of eminent
domain. Like the present case, the Court held the Project to
be an integrated and indivisible Project. We have no doubt that
in the present case also, the Expressway as well as the five
a parcels which are to be developed are part of an integrated
and indivisible Project. In the reported judgment of Sooraram
Pratap Reddy & Ors. Vs. District Collector, Ranga Reddy
District & Ors. etc. etc. (cited supra), it has also been found
that the entire amoont of the compensation was to be paid by
C the State agency APllC, just like in the present case, where the
entire amount is to be paid by YEIDA, which agency is working
as a nodal agency for the execution of the Project. The Court
has also found that where the power of eminent domain is
exercised ma/a fide or for collateral purposes and de hors the
Act or in an irrational or unreasonable manner or when the
D
purpose is 'no public purpose' and the fraud on statute is
apparent, a Writ Court can undoubtedly interfere. It has been
found very specifically here that the present matter is not
suffering from the above defects. In this judgment, the subject
of eminent domain has been discussed and considered with
E thoroughness and all the ramifications of the principle of
eminent domain have been discussed. We have already culled
out the principles emanating from this decision in the earlier
part of this judgment and even at the cost of repetition, we may
say that this judgment is practically, the law setter on the subject
F of eminent domain, as also on the other allied subjects of
acquisition. The judgment has also explained the concept of
'public purpose', which has been held to be wider than 'public
necessity'. The judgment proceeds on a basis that merely
because the benefit goes to a particular section of the society,
G the acquisition does not cease to be for the public purpose. It
has been specifically held that where the State is satisfied
about the existence of a public purpose, the acquisition would
be governed by Part II of the Act, as has happened in the
present matter. The judgment in Sooraram Pratap Reddy &
H Ors. Vs. District Collector, Ranga Reddy District & Ors. etc.
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 393
ORS. [V.S. SIRPURKAR, J.]
etc. (cited supra) is an authoritative pronouncement on the A
mode of payment, as also on the construction of Sections 40
and 41 of the Act. In fact, this judgment is a complete answer
to the argument of the appellants that this acquisition is not for
public purpose.
B
36. The respondents then fall back upon the nature of the
transaction, saying that since the whole transaction is on the
BOT basis, the Government has merely chosen a third party
agency to implement the Project instead of taking up itself the
task of building, designing, financing or running the Project. It C
was pointed out that in such contracts, the assets did not go to
the private enterprise which was chosen by the Government.
On the other hand, the assets revert to the Government and,
therefore, the BOT Project can never be akin to the acquisition
of land for a Company under Part VII of the Act, where the land
and the assets vest and belong to the Company. The D
respondents argued that when a BOT contract is tested in the
light of the provisions of Part VII of the Act, as also the Land
Acquisition (Companies) Rules, 1963, it would come out that
there has to be an agreement between the State and the
Company, which necessarily provides for the payment of cost E
of acquisition to the Government. It must entail the transfer of
such land to the Company. SimilaFly, under Rule 5 of the Rules
of 1963, the agreement must itself make provision that the land
will be utilized only for the purposes for which it was acquired
and if the Company commits breach of any condition of the F
agreement, the Government would be entitled to declare the
transfer of land to it to be null and void, so also if the Company
fails to utilize the entire land acquired, the unutilized portion
would revert to the Government. The respondents argued that
in a BOT contract, the land is only leased to a third party agency G
for the purposes of implementation of the Project. There is no
occasion for declaring the transfer of land to be null and void.
There would also be no occasion for reversion of the utilized
land of the State Government. The respondents, therefore,
H
394 SUPREME COURT REPORTS [2010] 11 S.C.R.
A argued that a BOT contract can never be contemplated as
falling under Part VII of the Act.
37. Some other decisions which were pressed in seNice
by the appellants are Smt. Somavanti & Ors. Vs. The State of
B Punjab & Ors. [AIR 1963 SC 151], more particularly, the
observations in paragraph 40 therein, where the Constitution
Bench of this Court observed that if the purpose of acquisition
is not related to a public purpose, then a question may well
arise whether in making the declaration there has been on the
part of the Government, a fraud on the power conferred on it
C by the Act. We have already discussed the factual situation
here for pointing out that this acquisition was indeed for the
public purpose and cannot be held to be for respondent
Company. In that view, the criticism is not justified. The decision
in Pandit Jhandu Lal Vs. State of Punjab (cited supra) was
D also referred to and, more particularly, the observations in
Paragraph 8 therein. There can be no dispute about the
principles laid down; however, as we have already pointed out,
this case has been thoroughly considered in Sooraram Pratap
Reddy & Ors. Vs. District Collector, Ranga Reddy District &
E Ors. etc. etc. (cited supra). We have already returned a finding
that the compensation in this case does not come from the
respondent Company alone. We approve of the finding returned
by the High Court in that behalf. During the debate, the decision
in Devinder Singh & Ors. Vs. State of Punjab & Ors. [2008(1)
F sec 728] was also referred to. It was urged that there was a
conflict in this decision and the decision in Pratibha Nema's
Case (cited supra). This was a case where the petitioners who
were the owner of the agricultural lands, had challenged the
acquisition of lands for Mis. International Tractors Ltd. It was
G claimed that the land was being acquired for public purpose
i.e. setting up the Ganesha Project of Mis. International Tractors
Ltd. at various villages. The High Court had held that the land
acquisition was for public purpose. This Court explained the
public purpose as defined in Section 3(f) of the Act and noted
H that the aforementioned Ganesha Project was not a Project of
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 395
. ORS. [V.S. SIRPURKAR, J.]
the State, but the one undertaken by the Company Mis. A
International Tractors Ltd. The Court then went on to consider
Sections 40 and 41 of the Act alongwith Rule 4 of the Land
Acquisition (Companies) Rules, 1963 and came to the
conclusion that the same could not be a public purpose as the
whole compensation was coming from the coffers of the B
Company. In that view, the Court further came to the conclusion
that the State not having followed the provisions of Sections 40
and 41 of the Act, the whole process had suffered illegality. The
Court also considered the decision in Pratibha Nema's Case
(cited supra) and distinguished the same by making a comment C
to the following effect:-
"But we must hasten to add that the Bench did not have
any occasion to consider the question as to whether the
State is entitled to take recourse to the provisions of both 0
Part II and Part VII of the Act simultaneously."
The Court, however, refused to go into the nicety of the
question and observed that in a case of acquisition for a public
Company, public purpose is not to be assumed and the point
of distinction between acquisition of lands under Part II and Part E
VI I of the Act would be the source of funds to cover the cost of
acquisition. The Court also considered the judgment of this
Court in Smt. Somavanti & Ors. Vs. The State of Punjab &
Ors. (cited supra), Jage Ram & Ors. Vs. State of Haryana &
Ors. [1971 (1) SCC 671] and Shyam Behari & Ors. Vs. State F
of Madhya Pradesh & Ors. [AIR 1965 SC 427]. Ultimately, the
Court came to the conclusion that the necessary provisions not
having been found, the view of the High Court was not correct,
whereby it had upheld the land acquisition, holding it to be for
the public purpose. We have closely seen the judgment; G
however, the factual situation in the judgment is quite different.
In our opinion, the judgment will not help the appellants to
contend that the present land acquisition is not for public
purpose. We also do not think that there is any serious conflict
between the decision in Pratibha Nema's Case (cited supra) H
•
396 SUPREME COURT REPORTS {2010] 11 S.C.R.
A and the decision in Devinder Singh & Ors. Vs. State of Punjab
& Ors. (cited supra), so as to require a reference to the larger
Bench. In our opinion, the decision in Pratibha Nema's Case
(cited supra) applies to the fact situation in this case. Therefore,
considering the overall factual situation, we are of the opinion
B that the High Court was right in holding that the acquisition was
made for the public purpose. We find from the order of the High
Court that the High Court has considered the question of public
purpose keeping in mind the correct principles of law. We are,
therefore, of the opinion that the contention raised by the
C learned Counsel for the appellants that this acquisition was not
for the public purpose for various reasons which we have
discussed, is not correct.
38. This takes us to the next point pertaining to the
application of Sections 17(1) and 17(4) of the Act. The learned
D Counsel for the appellants have vociferously u~ged that there
was no necessity whatsoever to apply the urgency clause to
these acquisitions and further to avoid the enquiry under Section
5A of the Act. According to the learned Counsel, this
dispensation of Section 5A enquiry was not only unjust, but
E added to the sufferings of the appellants who had lost their fertile
land. It was pointed out that this Project was slumbering since
2001 and it was in order to infuse fictitious urgency that a
reference to the Commonwealth Games was made. According
to the appellants, Right to be heard was akin to the
F Fundamental Rights and its breach has rendered the whole
acquisition exercise illegal. Numbers of authorities were relied
upon by the appellants. The respondents, on the other hand,
argued that there was material available before the
Government justifying the invocation of the urgency clause. The
G respondents argued that, in fact, the High Court has returned
the finding that there was material before the State Government
for dispensing with the enquiry under Section 5A of the Act and
that finding was based on the examination by the High Court
of the records of the State Government. It was pointed out that
H going through the ordinary procedure for acquisition of land
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 397
ORS. [V.S. SIRPURKAR, J.)
would have taken years for disposal of the objections while land A
was urgently required for public purpose, in this case, the
construction of interchange under the Yamuna Expressway
Project, which was absolutely essential for the purposes of
running the highway. It was also pointed out by the respondents
that because of the unnecessary litigation in the enquiries, the B
Project was hopelessly delayed and the cost had gone up from
Rs.1, 700 crores to whopping Rs.9, 700 crores. It was also
further pointed out that any waste of time would have invited
the encroachments on the land, which would have added to the
further trouble. The enormousness of the Project which required C
acquisition of 1,604 hectares of land involving 12,283 farmers,
would have taken years if the enquiry under Section 5A was
permitted and thereby, the cost would have still further soared
up. Numbers of authorities were relied upon by the parties.
D
39. Before considering the issue, we must take stock of
the finding returned by the High Court. In the judgment in Nand
Kishore Gupta & Ors. Vs. State of U.P. & Ors. (Civil Misc. Writ
Petition No.31314 of 2009), the High Court took stock of the
allegations regarding malafides and dispensing with the enquiry E
under Section 5A of the Act by referring to Paragraph Nos .. 20,
21, 28, 29, 30, 31 and 32 of the Reply filed on behalf of the
State Government through an affidavit of one Shri Vinod Kumar
Singh, ADM, Land Acquisition, Agra, wherein it was pointed
out that the Project was on the mammoth scale and there was
a great deal of possibility of encroachments if the Project was F
allowed to linger. The High Court took note of the contention
that YEIDA deposited 70% of the estimated compensation on
29.5.2009 itself, since 10% of the. estimated compensation
was already deposited by the acquiring body (YEIDA). The High
Court then referred to the various clauses of the Concession G
Agreement like Clause Nos. 2.1, 2. 2, 3.1, 3.2, 3.6 and 4.1 (a),
(b), (c) & (d) to know about the exact nature of the job which
was required to be done for building the Expressway. It was
after this that the High Court had recorded a finding that the
integrated Project was to cover a large area of land and the H
398 SUPREME COURT REPORTS [201 O] 11 S.C.R.
A requirement was of 25 million square meters of land to be
acquired. The High Court, therefore, noted the plea raised to
the effect that the State Government took correct decision to
invoke the urgency clause, as on an enquiry into disposal of
individual objections as contemplated under Section 5A of the
B Act, the Project itself would have lost all value and efficacy. The
High Court also noted the plea raised by YEIDA and the State
Government about the likelihood of encroachment. The High
Court then referred to the two decisions of this Court in
Sheikhar Hotels Gulmohar Enclave & Anr. Vs. State of Uttar
c Pradesh & Ors. [2008(14) SCC 716] and First Land
Acquisition Collector & Ors. Vs. Nirodhi Prakash Gangoli &
Anr. [2002 (4) SCC 160]. The High Court also referred to the
counter "ffidavit of one Shri V.C. Srivastava, Addi. General
Manager, Jaypee lnfratech Ltd. (owned by Jaiprakash
D Industries Ltd.). The High Court then took stock of the plea
raised on behalf of the respondents on the basis·of more than
25 judgments of this Court. The High Court then referred to the
decision of this Court in State of Punjab & Anr. Vs. Gurdial
Singh & Ors. [1980 (2) SCC 471] and Om Prakash & Anr. Vs.
State of UP. & Ors. [1998 (6) SCC 1], as also Babu Ram &
E Anr. Vs. State of Haryana & Anr. [2009 (10) SCC 115]. The
High Court also referred to the decision in Manju Lala Agrawal
Vs. State of UP. & Ors. [2007(9) ADJ 447 (DB)], Sudhir
Chandra Agrawal Vs. State of UP. [2008 (3) ADJ 289 (DB)]
and Munshi Singh Vs. State of UP. [2009 (8)' ADJ 360 (DB)],
F which all were the decisions of the Allahabad High Court itself.
The Court then referred to the delay on account of the litigations
from 2001 till 2008 and referred to the contention raised on
behalf of the appellants relying on the judgment in Essco Fabs
Pvt. Ltd. & Anr. Vs. State of Haryana & Anr. etc. etc. [2009
G (2) SCC 377], Mahender Pal & Ors. Vs. State of Haryana & .
Ors. [2009 (14) SCC 281] and Babu Ram & Anr. Vs. State of
Haryana & Anr. (cited supra). It then recorded a finding in the
following words:-
H "In order to verify whether there was any material with the
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 399
ORS. [V.S. SIRPURKAR, J.]
State Government to form an opinion and to exercise its A
powers under Section 17(1) and Section 17(4) of the Act,
dispensing with enquiry under Section 5A of the Act, and
that the State Government had applied its mind on such
material, we summoned the records of the three concerned
notifications. Shri Satish Chaturvedi, Addi. Advocate s·
General assisted by Shri M.C. Tripathi, Addi. Chief
Standing Counsel has produced the records alongwith the
material collected by the Collectors/District Magistrate and
placed before the State Government for forming an opinion.
He has taken us through the various documents and forms c·
on which the Collectors have recommended on Forms X
alongwith justification of their recommendations as well as
its summary given in the office note placed before the State
Government. The three files produced before us relate to
village Kuberpur, district Agra, village Malupur Pargana
D
Atmadpur, district Agra and village Tappal district Aligarh
for construction of interchange.
The notification under Section 4(1 )/17 of the Act for
proposing acquisition of land of village Kuberpur was
made on 20.2.2009 and was published in two newspapers · E
'Amar Ujala' and 'Dainik Jagran' on 27.7.2009. The
munadi was made on 7.3.2009. The notification under
Section 6(1 )/17 was issued on 15.6.2009 and was
published in the two newspapers on 18.6.2009. The notice
under Section 9 was sent on 20.6.2009 and possession F
was taken on 8.7.2009. In the recommendation sent by the
District Magistrate, considered by the State Government
on 11.2.2009 before publication of notification under
Section 4, the District Magistrate had after giving details
of land proposed to be acquired, had forwarded the Form- G
X alongwith justification referred to in para 3 of the noting
of the State Government. The Collector, Agra
recommended that in order to acquire the land for
Y.E.l.D.A. established under the U.P. Industrial Area
Development Act, 1976 the preparation of plan, H
400 SUPREME COURT REPORTS [2010) 11 S.C.R.
A identification of land for units for industrial development,
infrastructural facilities, the lease or sale of the land, the
construction of building and for industrial units. Y.E.l.D.A.
has been given the regulating powers. The village Kuberpur
is in the notified area of Y.E.l.D.A. and which urgently
B requires the proposed land for construction of interchange'
for Y.E.l.D:A. In case of any delay there is a strong
possibility of encroachment on the land, which will affect
the Project of Y.E.l.D.A. in public interest. In para 4 it was
stated that hearing of oral and written objections will take
several years causing indefinite delay in construction of
c interchange. The proposal was forwarded with
recommendation signed by the Under Secretary, Industrial
Development, Government of U.P., Special Secretary,
Industrial Development ; Shri Arun Kumar Sinha,
Secretary, Rehabilitation and Industrial Development
0 Department; Government of U.P.; Shri V.N. Garg, Principal
Secretary, Rehabilitation and Development, Government
of U.P. on 12.2.2009 and by Shri Shailesh Krishna, the
Principal Secretary to Chief Minister on 18.2.2009.
E As regard the acquisition of land for Y.E.l.D.A. for
interchange in village Malupur for construction of Yamuna
Expressway, Pargana Atmadpur, district Agra for
acquisition of 4.5322 hects. of land the proposal with
recommendation of District Magistrate, Agra on Form-X
F and the justification similar to and in the same language
as in the case of village Kuberpur, district Agra was placed
before the State Government alongwith the notings. The
proposal bears recommendations and signature of Under
Secretary, Industrial Development Department,
G Government of U.P. on 23.10.2008 ; Special Secretary,
Industrial Development, Government of U.P. on
24.10.2008; Principal Secretary, Industrial Development
and Commissioner on 30.11.2008 ; Special Secretary,
Industrial Development on 10.12.2008 and the Secretary
to Chief Minister on 15.12.2008.
H
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 401
ORS. [V.S. SIRPURKAR, J.]
A
For village Tappal in Tehsil Khair, district Aligarh proposal
for acquisition of 48.S72 hect. of land for Y.E.l.D.A. for
construction of Yamuna Expressway with the
recommendation of the District Magistrate and justification
for invoking urgency clause was placed before the State
Government arid was recommended and signed by the B
Under Secretary and Special Secretary, Industrial
• Development Department on 16.1.2009 ; Secretary,
~
.Rehabilitation and Industrial Development, Department of
Government of U. P. on 16.1.2009 ; Principal Secretary,
Industrial Development on 16.1.2009 and by the Secretary C
to the Chief Minister on the same day on 16.1.2009. The
proposals were accepted by the State Government for
acquisition and for invoking urgency clause for construction
ofYamuna Expressway by Y.E.l.D.A."
D
Ultimately, the High Court wrote a finding in the following
words:-
"The record produced before us by the State Government
enclosing the material of invoking urgency clause and the
satisfaction of the State Government on the said material, E
has satisfied us that the State Government had sufficient
material and had applied its mind to record its opinion that
there was urgency to acquire the land to dispense with the
enquiry under Section SA of the Act."
F
We have deliberately quoted the above part of the High
Court judgment only to show the meticulous care taken by the
High Court in examining as to whether there was material
before the State Government to dispense with the enquiry under
Section SA of the Act. We are completely convinced that there G
was necessity in this Project considering the various reasons
like enormousness of the Project, likelihood of the
encroachments, number of appellants who would have required
to be heard and the time taken for that purpose, and the fact
that the Project had lingered already from 2001 till 2008. We
H
402 SUPREME COURT REPORTS [201 O] 11 S.C.R.
A do not see any reason why we should take a different view than
what is taken by the High Court. The law on this subject was
thoroughly discussed in Tika Ram & Ors. etc. etc. Vs. State of
UP. & Ors. etc. etc. [2009 (10) sec 689], to which one of us
(V.S. Sirpurkar) was a party. In that decision also, we had
B reiterated that the satisfaction required on the part of Executive
in dispensing with the enquiry under Section 5A is a matter
subject to satisfaction and can be assailed only on the ground
that there was no sufficient material to dispense with the en<Jliry
or that the order suffered from malice. It was also found on facts
c in Tika Ram & Ors. etc. etc. Vs. State of UP. & Ors. etc. etc.
(cited supra) that there was no charge of malafide levelled
against the exercise of power and there was material available
in support of the satisfaction on the part of the Executive
justifying the invocation of the.provisions of Section 17. The
position is no different in the present case. The High Court in
0
the present matter went a step ahead and examined the bulky
original record itself to find that there was full material available.
40. We are not impressed by the argument that the
encroachment issue was not a relevant factor. This argument
E was based on the reported decision in Om Prakash & Anr. Vs.
State of UP. & Ors. (cited supra). It must be said that the actual
scenario in that case was different. In that case, the Court was
considering the acquisition of area of about 500 acres
comprising of 437 plots, whereas, in the present case, the area
F to be acquired for the Expressway alone was more than 1,600
hectares. This is apart from the 25 million square meters of land
which was liable to be acquired for the purposes of
development of 5 land parcels. There was interlinking between
the acquisition of land for the highway and the acquisition of
G land for establishing the 5 townships. In Om Prakash & Anr.
Vs. State of UP.. & Ors. (cited supra), there was unexplained
delay after issuance of Section 4 notification, which is not the
case here. Therefore, we do not think that what has been said
in Om Prakash & Anr. Vs. State of UP. & Ors. (cited supra)
H would be apposite here. Every case has to be decided on its
NANO KISHORE GUPTA & ORS. v. STATE OF U.P. & 403
ORS. [V.S. SIRPURKAR, J.]
own facts. This is apart from the fact that it is not specifically A
laid down in Om Prakash & Anr. Vs. State of UP. & Ors.
(cited supra) that the encroachment was never a relevant factor
for dispensing with the enquiry under Section 5A. Again we
hasten to add that this was not the only factor considered by
the State Government and even the High Court has not held B
the same to be the only factor for dispensing with the enquiry.
41. In view of the law laid down in the last judgment on this
issue i.e. Tika Ram & Ors. etc. etc. Vs. State of UP. & Ors.
etc. etc. (cited supra), we are of the clear opinion that the C
challenge by the appellants on the ground that there was no
urgency and, therefore, the enquiry under Section 5-A of the Act
should not have been dispensed with, cannot be accepted. We
hold accordingly.
42. No other point was canvassed before us. D
43. There is no merit in the appeals. They are dismissed.
The two impugned judgments of the High Court i.e. Civil Misc.
Writ Petition No. 48978 of 2008 (Balbir Singh & Anr. Vs. State
of UP. & Ors.) decided on 5.10.2009 and Civil Misc. Writ E
Petition No. 31314 of 2009 (Nand Kishore Gupta & Ors. Vs.
State of UP. & Ors.) decided on 30.11.2009 are confirmed.
There shall be no costs.
K.K.T Appeals dismissed.
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