Supreme Court of India
RAMESH CHANDRA SHARMA & ORS.versusSTATE OF UTTAR PRADESH & ORS.
- Citation
- 2023 INSC 144
- Decided
- 20 February 2023
- Disposal
- Appeal(s) allowed
- Bench
- KRISHNA MURARI
Holding
The classification of landowners as Pushtaini and Gair‑Pushtaini for differential compensation under the Land Acquisition Act is violative of Article 14 and the Nagpur Improvement Trust precedent and must be struck down, with the remaining compensation provisions upheld.
Summary
The appellants, landholders whose property was acquired by the Greater Noida Authority, challenged the classification of owners as "Pushtaini" and "Gair‑Pushtaini" which resulted in differential compensation. The Supreme Court held that the classification was not authorized by the Land Acquisition Act, 1894 or the Uttar Pradesh Rules and violated Article 14 as it lacked intelligible differentia and a rational nexus to the statutory purpose. The Court applied the reasonable classification, Wednesbury, and proportionality tests, finding the classification arbitrary, discriminatory, and contrary to the Nagpur Improvement Trust precedent. It was held that the mischief lay only in the classification, which could be severed, leaving the remaining compensation provisions valid. Consequently, the High Court's judgment upholding the classification was set aside and the appellants were entitled to uniform compensation.
Issues considered
- Whether the appellants, by signing the compensation agreement, waived their right to seek enhanced compensation.
- Whether the classification of landowners as Pushtaini and Gair‑Pushtaini for payment of compensation at different rates violates Article 14 of the Constitution.
- Whether the classification made by the High Court is in contravention of the law laid down in Nagpur Improvement Trust & Another v. Vithal Rao & Others (1973).
Legislation cited
Subjects
Land acquisitionArticle 14reasonable classificationdiscriminationcompensationex‑gratiaproportionality testWednesbury principleNagpur Improvement TrustPushtainiGair‑Pushtaini
Judgment
422 [2023]
SUPREME COURT 2 S.C.R. 422
REPORTS [2023] 2 S.C.R.
A RAMESH CHANDRA SHARMA & ORS.
v.
STATE OF UTTAR PRADESH & ORS.
(Civil Appeal No. 8819 of 2022)
B FEBRUARY 20, 2023
[KRISHNA MURARI AND S. RAVINDRA BHAT, JJ.]
Land Acquisition Act, 1894– U.P. Land Acquisition
(determination of compensation and declaration of award by
agreement) Rules, 1997 – Payment of compensation – Classification
C
of landholders as Pushtaini or Gair-Pushtaini – Impermissibility of –
Held: Classification made by the GNOIDA authority for the purposes
of awarding differential compensation is bad in law – Land
Acquisition Act does not distinguish between classes of owners, and
uniformly provides compensation to all class of landowners –
D Classification made between Pushtaini landowners and Gair-pushtaini
landowners is violative of the law laid down in the Nagpur Trust
case and Article 14 – Said classification made by the executive
actions is bad in law, and is liable to be set aside – However, since
the mischief lies only within the classification, it can be severed,
and the remaining part of the executive actions that set out to grant
E
compensation for the purpose of rehabilitation remains valid in law
– Impugned judgment passed by the Full Bench of the High Court
set aside – Appellants entitled to the reliefs claimed in the Writ Petition
filed before the High Court – Constitution of India – Art.14.
Constitution of India – Art.14 – Reasonable Classification
F
Test, Wednesbury Principle and Proportionality Test – Discussed –
Administrative Law.
Allowing the appeals, the Court
HELD: 1. Whether the Appellants are bound by the
G compensation as per the agreement under the Land Acquisition
rules, and have waived off their right to seek enhanced
compensation?
The Respondent Authority argued that since the agreement
was consented to, no challenge could exist in the Court. This
H argument in the facts of the case, has been raised only to be
422
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 423
PRADESH
rejected. The issue involved in adjudication is not in respect of A
an agreement entered into by the appellants. Similar agreements
were also entered into with the Authority by such identically
situated landholders who have been granted additional
compensation subsequent to the agreement by carving out a
distinction on the basis of period of residence/occupation of the
B
land which was acquired by creating an artificial classification of
‘Pushtaini’ and ‘Gair-Pushtaini’ landholders. Furthermore, since
the issue of additional compensation by making an artificial
classification of ‘pushtaini’ and ‘Gair-pushtani’ was not in existence
at the time of the agreement, there was no occasion to challenge
the same. Further, specifically in the context of the grant of ex- C
gratia payment, it is to be noted that the said payment granted to
Pushtaini landowners through a separate notification, was
assessed, and given, after the agreement was signed by both,
Pushtaini and Gair-pushtaini Landowners. The Appellants herein,
under those circumstances, could not have challenged the
D
agreement vis a vis the exgratia payment on grounds of violation
of Article 14, when no such violation existed at the time of the
agreement. No man can be expected to predict a future violation
of their rights and file a pre-emptive appeal.The Appellants,
because of their signing of the agreement, have not forfeited their
right to seek revised compensation, because ,the cause of action E
accrued to them much after entering into the agreement. The
issue no. 1 is answered accordingly in the negative and in favour
of the Appellants.[Paras 27-30][448-D-H; 449-A-B,D]
2.1 Whether the classification made by and executive fiat
between Pushtaini Landowners and Gair-pushtaini Landowners F
for payment of compensation at different rates is liable to be struck
down as violative of Article 14 of the Constitution?
REASONABLE CLASSIFICATION TEST
For any classification to survive the test of Article 14, the
classification must be based on intelligible differentia, and it must G
have a rational nexus to the object sought to be achieved by the
law. The object sought to be achieved must also be lawful, and if
the object of the law itself is found to be discriminatory, then
such discrimination must be struck down. [Para 33][451-C-D]
H
424 SUPREME COURT REPORTS [2023] 2 S.C.R.
A 2.2 While prima facie, the classification and the object
sought to be achieved through the said classification seems
reasonable, however, the devil lies in the details. The justification
given by the GNOIDA Authority, and the Full-bench of the High
Court assumes that only Pushtaini landowners permanently reside
in the subject land or that the subject land is the primary source
B
of income only for Pushtaini landowners, and this assumption has
been backed by no empirical data produced by the authority. While
the classification made by Greater Noida has been based on the
object of giving fair compensation, however, such a laudable object
of the classification would stand breached by the effects of such a
C classification, creating a dissonance between the object and its
effect. Many Gair-pushtaini landholders, whose main area of
residence or their main source of income is also the subject land,
would be subject to great discrimination and injustice, if the same
compensation that has been granted to the pushtaini landholders
is not extended to them. [Paras 38, 39][455-F-H; 456-A-B]
D
2.3 WEDNESBURY PRINCIPLE
The classification made by GNOIDA does not find its footing
in the Land Acquisition Act, or the UP-Land Acquisition Rules,
and hence is contrary to law. The said classification also suffers
E from not taking into account relevant considerations. The
Authority, without taking into account any empirical data, or
calculating any possibility of Gair-pushtaini landowners being
rendered landless or without a primary source of income, made
the impugned classification. These relevant factors, by not being
taken into account, can and would cause great injustice to Gair-
F pushtaini landowners. Further, GNOIDA, by arbitrarily classifying
the landowners as Pushtaini and Gair-pushtaini on the basis of a
cut-off date, have taken into account an irrelevant factor. The
cut-off date by itself, without any context of the landowners on
ground, is not indicative of who the most adversely affected
G landowners are. By not complying with these three factors while
making the classification, this Court must strike down such a
classification. [Paras 44, 45][457-F-G; 458-A-B]
2.4 PROPORTIONALITY TEST
The interfering law, i.e. the impugned notification that
H creates the classification, does not have a rational nexus to the
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 425
PRADESH
object sought to be achieved, and thus, violates the first two A
prongs of the proportionality test. Coming to the third and fourth
prong of the proportionality test, i.e whether the classification
created by the Authority was a necessity to achieve the state aim
of compensating those landowners that are either direct residents
46 of the land or the land exists as their primary source of income
B
and whether such measure was proportional to the object sought
to be achieved. For this, it is pertinent to refer to Section 23 of
the Act, which provides for matters to be taken into account while
determining the compensation. A bare perusal of Section 23 would
show that, the grounds for classification as purported by the
GNOIDA authority, have already been covered by Section 23 of C
the Act. The fifth point of the said Section squarely covers the
requirement of compensating for rehabilitation of the affected
landowners. In the presence of an already existing provision in
the act, the classification created by the GNOIDA authority, must
exist in furtherance of the said Section, and not in contrast of.
D
[Paras 52-54][465-B-D; 466-C-D]
2.5 The classification if allowed to exist, can lead to several
Gair-pushtaini landowners who may also need to be rehabilitated,
cannot rehabilitate themselves without compensation for the
same. This circumstance alone besides being discriminatroy pits
the said classification against Section 23 of the Act, causing an E
insubordination to the 1894 Act. Such a mischief, if allowed to
exist, would not only nullify the purpose of the Act, but also violate
the third and fourth principle of the proportionality test, and hence
is liable to be struck down. Further, it is also important to note
that the classification, even if allowed to exist, does not come F
with any safeguards against its potential abuse. As mentioned
above, the said notification by way of its classification creates
disastrous mischief, and the notification does nothing to remedy
such potential abuse. No guidelines for the said classification exist,
nor are there any bars placed. If such classification is left
unchecked, it may lead to bad precedence, and disastrous G
ramifications in the future. This lack of substantive guidelines
also violates the fifth prong of the proportionality test. The
impugned classification is liable to be struck down as violative of
Article 14 of the Constitution of India. [Paras 55-57][466-D-H]
H
426 SUPREME COURT REPORTS [2023] 2 S.C.R.
A State Of West Bengal Vs. Anwar Ali Sarkar (1952) AIR
75 : [1952] SCR 284; Rustom Cavasjee Cooper (Banks
Nationalisation) v. Union of India (1970) 1 SCC 248 :
[1970] 3 SCR 530; Navtej Singh Johar & Ors. Vs.
Union of India Thr. Secretary, Ministry of Law and
Justice (2018) 10 SCC 1 : [2018] 7 SCR 379; K. S.
B
Puttaswamy & Anr. Vs. Union of India & Ors (2017) 10
SCC 1 : [2017] 10 SCR 569 – followed.
Gujarat Mazdoor Sabha & Anr. Vs. State of Gujarat
(2020) 10 SCC 459 – relied on.
C Associated Provincial Picture Houses Limited v.
Wednesbury Corporation [1948] 1 KB 223 – referred
to.
3. Whether the classification made by the Full-Bench of
the High Court between Pushtaini landowners and Gair-pushtaini
D landowners is in contravention to the law laid down by this Hon’ble
Court in the case of Nagpur Improvement Trust and another vs.
Vithal Rao and others (1973) 1 SCC 500?
The classification made by the GNOIDA authority for the
purposes of awarding differential compensation is bad in law, and
E it is precisely this kind of classification that has been barred.
When the purpose of the acquisition of the land is for the benefit
of the public at large, then the nature of the owner of the said
land is inconsequential to the purpose. If such a classification on
the basis of the nature of owner is allowed, then on the same
grounds, there might be a possibility of future classifications where
F powerholding members of the society may get away with a larger
compensation, and the marginalized may get lesser compensation.
This is precisely what this Court in the abovementioned judgment
predicted, and to preempt such arbitrary classification, clarified
the position in law. The Land Acquisition Act does not distinguish
G between classes of owners, and uniformly provides compensation
to all class of landowners. The classification made between
Pushtaini landowners and Gair-pushtaini landowners, on the basis
of the reasoning mentioned above, is violative of the law laid
down in the Nagpur Trust case and Article 14 of the Constitution.
[Para 59, 60][468-B-F]
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 427
PRADESH
Nagpur Improvement Trust and Another Vs. Vithal Rao A
and Ors. (1973) 1 SCC 500 : [1973] 3 SCR 39 – relied
on.
4.1 The classification made by both the executive actions
is bad in law, and is liable to be set aside. The Land Acquisition
Act does not envisage any differential compensation on the basis B
of such classification, and hence, this Court must infer the
compensation to be provided by the executive actions within the
confines of Section 23 of the Act. Section 23 of the Land
Acquisition Act states out the grounds for granting compensation
in cases of acquisition of land under the Act. One such reason for
the grant of compensation is rehabilitation, and it is this need for C
granting compensation for rehabilitation under the Act that is
echoed by the impugned notification. A bare reading of both the
executive actions in consonance with the Act would show that
the need for giving compensation for rehabilitation is valid in law
and is backed by the parent statute. The mischief then, is only D
limited to the arbitrary classification made by such actions. In
such a case, since the mischief lies only within the classification,
it can be severed, and the remaining part of the executive actions
that sets out to grant compensation for the purpose of
rehabilitation remains valid in law. Once the classification is
removed, and the executive actions are read in consonance with E
the parent act, it would be seen that since the Act, and now even
the executive actions do not discriminate in terms of
compensation, the ex gratia payment and the increased base
amount, as enunciated by the executive actions, must be given
to all landowners in the subject area. [Paras 62, 63][468-H; 469- F
A-C]
4.2 Further, in cases of administrative action, even if the
classification has a rational nexus to the objective of the
notification, the classification must also be legitimized by the
parent statute. If the parent statute does not allow for a G
classification, then, even if the classification vis-à-vis the
notification is able to pass the tests of Article 14, it would still be
liable to struck down if the parent statute does not allow for the
same. The impugned judgment passed by the Full Bench of the
High Court is not liable to be sustained and stands set aside. As
H
428 SUPREME COURT REPORTS [2023] 2 S.C.R.
A a consequence, the Writ Petition filed by the appellants before
the High Court stands allowed and the appellants are held entitled
to the reliefs claimed in the said Writ Petition. [Paras 65, 67][469-
F-H; 470-A-B]
Om Kumar & Ors. Vs. Union Of India (2001) 2 SCC
B 386 : [2000] 4 Suppl. SCR 693; Smt. Madhuri
Srivasatava Vs. State of U.P. & Ors. (2016) 6 SCC
OnLine AII 2832; Gajraj Vs. State of U.P (2011) SCC
OnLine AII 1711; Radheyshyam (Dead) through L.Rs
& Ors. Vs. State Of UP & Ors. (2011) 5 SCC 553 :
[2011] 8 SCR 359; Greater Noida Industrial
C Development Authority Vs. Devendra Kumar & Ors.
(2011) 12 SCC 375; Savitri Devi Vs. State of U.P. &
Ors. (2015) 7 SCC 21 : [2015] 7 SCR 512 – referred
to.
Case Law Reference
D [1973] 3 SCR 39 referred to Para 4
[2011] 8 SCR 359 referred to Para 10
[2015] 7 SCR 512 referred to Para 10
[1952] SCR 284 followed Para 34
E [1970] 3 SCR 530 followed Para 35
[2018] 7 SCR 379 followed Para 36
[2000] 4 Suppl. SCR 693 referred to Para 43
[2017] 10 SCR 569 followed Para 48
F
CIVIL APPELLATE JURISDICTION : Civil Appeal No.8819
of 2022.
From the Judgment and Order dated 30.03.2018 of the High Court
of Judicature at Allahabad in WC No.49326 of 2009.
G With
Civil Appeal Nos. 8820 And 8821 of 2022.
Salman Khurshid, S.G. Hasnain, Pradeep Kant, Ravindra Kumar
Raizada, Ravindra Kumar, Sr. Advs., Prashant Kanha, Gaurav Srivastava,
Aftab Ali Khan, Syed Mohd. Fazal, M.Z. Chaudhary, Ms. Azra Rehman,
H Ms. Aadya Mishra, Ms. Saba Baby Khan, Rohit Kumar Singh, Simranjeet
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 429
PRADESH
Singh Rekhi, Harsh Jain, Anuvrat Sharma, Arun Kumar Singh, Ms. Alka A
Sinha, Binay Kumar Das, Ms. Priyanka Das, Ms. Neha Das, Ajai Kumar,
Ms. Kamini Jaiswal, Omanakuttan K. K., Advs. for the appearing parties.
The Judgment of the Court was delivered by
KRISHNA MURARI, J.
1. These appeals are directed against the judgment and order B
dated 30.03.2018 passed by a Full Bench of the High Court of Judicature
at Allahabad (hereinafter referred to as ‘the High Court’), The
reference to Full Bench came to be made under the following
circumstances: -
1.1 Writ Petition No. 61449 of 2009, Smt. Madhuri Srivasatava C
Vs. State of U.P. & Ors.1 along with other connected petitions were
filed by certain landholders whose land was acquired by NOIDA
challenging the decision of the Board of Directors of NOIDA dated
07.01.1998 as also the approval granted to the said resolution by the
State Government dated 02.03.2009 whereby a distinction was carved
out in the matter of payment of compensation by creating a classification D
between “Pushtaini” and “Gair-pushtaini” landholders. The ‘Pushtaini’
landholders whose lands were acquired, were given additional
compensation @ Rs.3 per sq. yard along with 15% as rehabilitation
bonus on the compensation already awarded, as also the 10% area of
the acquired land, whereas those who were declared as ‘Gair-pusht E
xcaini’ were denied this additional benefit. A Division Bench of the High
Court vide Judgment and order dated 10.05.2016 dismissed the Writ
Petition holding the classification to be reasonable having direct nexus
with the object sought to be achieved i.e., rehabilitation of the original
residents who are likely to become landless due to the acquisition of
their land. F
2. Another bunch of Writ Petitions were filed by the present
appellants challenging a similar classification made by the Greater Noida
Authority (hereinafter referred to as ‘G Noida’) in payment of
compensation on the basis of the landholder being ‘Pushtaini’ and ‘Gair-
Pushtaini’. G
3. While considering the Writ Petitions, another Division Bench
disagreed with the views expressed in the case of Smt. Madhuri (Supra)
and vide order dated 07.07.2017 referred the matter to be decided by a
larger Bench.
1
(2016) 6 SCC OnLine AII 2832 H
430 SUPREME COURT REPORTS [2023] 2 S.C.R.
A 4. The Full Bench constituted in pursuance to the reference
framed the following questions for adjudication :-
(i) Whether the law laid down by a Division Bench of this
Court in the case of Smt. Madhuri Srivastava reported in
(2016) 6 ADJ 1 is in conflict to the law laid down by the
B Supreme Court in the case of Nagpur Improvement Trust
and Another Vs. Vithal Rao and Ors.2 and also with the
provisions of the Land Acquisition Act, 1894?
(ii) Whether the classification made under the U.P. Land
Acquisition (determination of compensation and declaration
C of award by agreement) Rules, 1997, the distinction made
among ‘Pushtaini’ and ‘Gair-Pushtaini’ farmers, is a
classification having reasonable nexus with the object sought
to be achieved?
5. Vide impugned judgment and order dated 30.03.2018, the Full
D Bench answered question No. 1 in negative and question No. 2 in
affirmative and upheld the view taken by the Division Bench in the case
of Smt. Madhuri Srivastava (Supra). As a consequence of the answers
to the questions framed, the Full Bench held that nothing remains to be
decided in the Writ Petitions filed by the present appellants and the same
were dismissed.
E
6. Before we enter into the factual matrix of the case, we find it
expedient to first trace out the etymology of the words “Pushtaini” and
“Gair Pushtaini” used in the impugned classification, for language, once
adopted inside the realm of law, materializes itself a much more powerful
being, one which must be understood in the right historical context.
F
7. The word ‘Pushtaini’ is a Persian word and finds its origin from
the word ‘Pusht’, which means ‘back’. The said word has been historically
used in the context of ancestry. Any possession, tale or legend, that has
roots to a particular ancestry, to denote it’s significance to the said
ancestry, the word ‘Pushtaini’ is used. As is obvious, since the word
G ‘Gair’ which finds its origin in Urdu language means ‘other than’, thus,
‘Gair-Pushtaini’ would mean one which is not ‘Pushtaini’.
8. What we find most interesting however, is that ancestry as a
concept, especially before times of modern private property ownership,
2
H (1973) 1 SCC 500
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 431
PRADESH [KRISHNA MURARI, J.]
had remained to be a tool for inclusivity and not exclusion. In such a A
context, the use of the word “Pushtaini” by the Authority, to exclude
compensation might be a historically inaccurate interpretation. While
this is not consequential to the merits of the case, it is in our opinion a
worthwhile observation, for law has to power to legitimize the meaning
of words and can change the context in which a word used, and in turn
B
can change the course of history itself.
Background Facts
9. Since the early 1970s, Liberalization took over India by storm,
and it brought with it the promise of massive economic growth. A huge
amount of money was infused in the Indian Economy with the purpose C
of developing Indian cities into massive global hubs of capital and
business. In line with this, Delhi began its journey of becoming a global
city. This influx of capital into the city also brought with it massive
employment opportunities, and people from all over the country started
migrating to Delhi. To contain such influx of migrants and ensure dignified
living for all who came to the city with the hopes of improving their lives, D
the government of India planned to develop residential and industrial
areas around the capital. For this, Gurgaon was developed across the
border of Haryana, and New Okhla Industrial Development Authority
(NOIDA) was developed by the Uttar Pradesh Government in the
adjoining district of Gautam Budh Nagar. In this period, the city enjoyed E
massive growth, both in terms of influx of capital and migration. This
growth was so unprecedented, that it even exceeded the planning estimates
as envisaged by the authorities. As a measure to accommodate such
growth, the Uttar Pradesh Government, exercising its powers under
Section 3 of the U.P. Industrial Area Development Act, 1976, by
notification dated 28.01.1991 created the township of Greater Noida, in F
an area of 38000 hectare, comprising of 124 villages of Gautam Budh
Nagar.
10. For its planned development, the Respondent- G. Noida started
acquisition of land within its territorial area of operation under the
provisions of Land Acquisition Act (hereinafter referred to as ‘1894 G
Act’). In the same connection, notifications dated 03.10.2005 and
05.01.2006 were issued under Sections 4(1) and Section 6(1) of 1894
Act for acquisition of total area of 580.1734 hectares of the land for plan
development situate in different villages falling within the jurisdiction of
G. Noida. The said notifications, which also included the land of the H
432 SUPREME COURT REPORTS [2023] 2 S.C.R.
A present appellants, were subject matter of challenge before the High
Court in a bunch of Writ Petitions challenging the acquisition proceedings
mainly on the ground of arbitrarily invoking urgency clause under Sections
17(1) read with Section 17 (4) of the 1894 Act. The bunch of the said
Writ Petitions came to be decided by the another Full Bench of the High
Court titled as Gajraj Vs. State of U.P3. The High Court concluded that
B
the urgency clause was wrongly invoked, but saved the acquisition for
the reason that much development had already taken place over the said
land and the nature of land stands completely changed. The Full Bench
further in order to compensate the landholders directed an additional
compensation to be paid to the landholders at the rate of 64.70% of the
C already paid compensation and a further direction was issued to allot
developed Abadi land to the extent of 10% of their acquired land, subject
to a cap of Rs.2,500/- square meter. The Full Bench never made any
distinction between ‘Pushtaini’ and ‘Gair-Pushtaini’ farmers for payment
of the additional compensation or allotment of land. The Full Bench also
relying upon the decisions rendered in the case of Radheyshyam (Dead)
D
through L.Rs & Ors. Vs. State Of UP & Ors. 4, Greater Noida
Industrial Development Authority Vs. Devendra Kumar & Ors.5,
further held that merely because the farmers had received compensation
under an agreement, it cannot be said that they have waived off the right
to challenge the same. The Full Bench judgment in Gajraj (Supra)
E came to be affirmed by this Court in Savitri Devi Vs. State of U.P. &
Ors. 6
11. The present appellants had also filed a Writ Petition being
Writ Petition No. 62056 of 2011 challenged the notification issued under
Sections 4 and 6 read with Section 17 of the Act. The said Writ Petition
F came to be disposed of in terms of the directions issued by the Full
Bench in the case of Gajraj (Supra) vide judgment and order dated
01.11.2011.
12. It is also pertinent to mention at this stage that even before the
land acquisition proceedings were initiated and notification under Sections
G 4 and 6 of the 1894 Act, were issued, the Respondent-Greater Noida in
its 26 th Board meeting dated 28.10.1997 decided to classify the
landholders for the purposes of payment of compensation for acquisition
3
(2011) SCC OnLine AII 1711
4
(2011) 5 SCC 553
5
(2011) 12 SCC 375
6
H (2015) 7 SCC 21
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 433
PRADESH [KRISHNA MURARI, J.]
of their land as ‘Pushtaini’, namely, those landholders who had purchased A
the land prior to the date of establishment of authority i.e., 28.01.1991 or
thereafter got the land by partition or family settlement and ‘Gair-
Pushtaini’ being those persons who purchased the land after its
establishment. Thus, two classes of landholders were carved out for
payment of compensation and those who were classified as ‘Pushtaini’
B
landholders, a higher amount of compensation was decided to be awarded
to them in the name of their rehabilitation.
13. Subsequently, on 15.07.2006, an agreement was entered into
between Greater Noida and the appellants and other landholders under
Rule 4(2) of the Land Acquisition Rules, 1997 (hereinafter referred to
as ‘1997 Rules’) and in accordance with the resolution passed by Greater C
Noida in its 26th Meeting, the ‘Pushtaini’ landholders were paid
compensation @ Rs. 322 per sq. yard and the ‘Gair-Pushtaini’ landholders
including the appellants herein were paid a lesser amount of compensation
@ Rs.280 per sq. yard.
14. The landholders continued with their agitation making demand D
of further compensation at the enhanced rate which resulted in
constituting a Committee to consider the demand of enhanced rate of
compensation in the form of bonus/ex-gratia compensation. The
Committee submitted its report after making a recommendation for
payment of the amount @ Rs.310 per square metre on account of Ex- E
gratia to the Ancestral Agriculturists of the land situate in 8 Villages.
15. The report of the Committee dated 25.10.2008 is being
reproduced hereunder for a ready reference :-
“ ANNEXURE P-4
25.10.2008 F
Recommendation of the Committee constituted in connection
with making consideration on the demands of bonus/ex- gratia/
compensation enhancement at the enhanced rate in
connection with the land of Village Ghodi Bachheda and other
Villages as per Order No.4/4/1/2008 -C.X. (1) Lucknow dated G
4.09.2008 of the Government of Uttar Pradesh
Following Committee has been constituted in connection with
making consideration on these types of demands and bonus /
ex-gratia /compensation enhancement at the enhanced rate
in connection with the land of Village Ghodi Bachheda and H
434 SUPREME COURT REPORTS [2023] 2 S.C.R.
A other Villages vide Order No.4/4/1/2008 C.X. (1) Lucknow
dated 4.09.2008 of the Government of Uttar Pradesh:-
1. Shri Thakur Jaibir Singh, Hon’ble Minister, Rural
Engineering Service, Agricultural Foreign Trade and
Agriculture Export Chairman
B
2. Chief Executive Officer, Greater Noida - Member
3. District Magistrate, Gautam Buddh Nagar - Member
Coordinator Examined and perused the records made
available in evidence of the Memos submitted by the
representatives of agriculture is organizations / Agriculturists
C
and perused the background of the and its different aspects
by the Committee and while convening Committee Meeting of
the Committee of Villages / their representatives, even
consideration was made in respect of the above matter,
particulars of which is given below:-
D
1. Background- this decision was taken in the 26th meeting
dated 28.10.1997 of the Greater Noida Authority Board that
the rate of compensation be assessed on the basis of agreement
by the Authority for each financial year and those
Agriculturists, who are agreed for executing the consent at
E the rates of the questioned Financial Years, they while
executing the agreement/consent, may receive compensation
under contract/consent regulation and those Agriculturists,
who are not agreed with the prescribed rate, the compensation
will be payable to them at the rate prescribed by the learned
District Magistrate under provisions of Section 23 of the Land
F
Acquisition Act 1994. On the basis of above sequence, for
the year of 1997-98, the rate of compensation was assessed
@ Rs.110 per square and in future, it will be enhanced in
accordance with cost inflation index in each financial year.
Vide Order No.902/778 3-0 7-1 43 N/04. of the Government
G of Uttar Pradesh, a High Level Committee under
Chairmanship of the Commissioner, Meerut Division, Meerut
was constituted. Committee has recommended its compensation
value @ Rs.800-850 per square metre, in sequence thereto,
in the meeting of Greater Noida Authority Board held on
5.01.2008, while assessing the compensation @ Rs.850 per
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 435
PRADESH [KRISHNA MURARI, J.]
square metre, decision was taken to enforce this rate with A
effect from 1.04.2007.
Even the particulars of these types of Memos are also
mentioned in the recommendation dated 4.01.2008 of the
Committee constituted under chairmanship of the
Commissioner, Meerut Division, Meerut vide Order dated B
31.12.2007 of the Government issued previously, whereby it
is clear that at that time also, The Villagers of the above
Villages were making demand for enhancement in
compensation. The certain Memos of the Villagers were
forwarded to the Government for appropriate guidelines/
C
directions while enclosing them as per Authority letter No.931
/ land-record / L.P./2008 dated 7.03.2008/ 903/ land-record /
LP/2008 dated 10.03.2008, Land Record/1 a/2008 dated
13.03.20081038/land-record/L.A./2008 dated 29.04.2008,
1055/ land-record/ LA / 2008 dated 5.05.2008/ 1069/land-
record/ LA/2008 dated 9.05.2008, 1113, 1115/land-record/L D
A/2008 dated 06.06.08. Thereafter, by Order dated
10.05.2008 of the Chairman and Chief Executive Officer,
Greater Noida, for examination of the demand of
compensation enhancement raised by the Agriculturists, a
Committee of District Magistrate, Gautam Buddha Nagar,
E
Chief Executive Officer, Deputy Chief Executive Officer,
Greater Noida was constituted and in its report dated
21.07.2008, recommendation was made to make consideration
for additional amount @ Rs. 175 -200 square metre to the
Agriculturists of the land acquired in the Financial Years
2006-2007 of the Village Ghodi Bachheda including other F
Villages. Such directions were given while making perusal of
the Recommendation of the Committee in the 72nd Meeting
dated 11.08.2008 of the Authority Board, that while making
calculation of the situation of its financial source and its
management, the case be referred to the Government. Vide
G
Order No.4/4/1/2008 -C.X. (1) Lucknow dated 4.09.2008 of
the Government of Uttar Pradesh, the above Committee was
constituted for giving recommendation in connection with
making consideration on the demands of bonus / ex-gratia/
enhancement of compensation and etc. at the enhanced rate
in connection with the Village Ghodi Bachheda and other H
436 SUPREME COURT REPORTS [2023] 2 S.C.R.
A Villages.
2. Meetings of the Committee - That first meeting of the
Committee was convened on 15.09.2008 in the conference
room of Uttar Pradesh Sadan, New Delhi, in addition to the
Chairman of Committee, following officers have taken part-
B
1. Shri Pankaj Agarwal, Chief Executive Officer, Greater
Noida
2. Shri Shravan Kumar Sharma, District officer, Gautam
Buddha Nagar
C In addition to above, following officers of the Greater Noida
Authority were appeared in the above meeting-
1. Shri Shailendra Chaudhary, Deputy Chief Executive
Officer, Greater Noida.
2. Shri Shishir, Special Executive Officer, Greater Noida
D
Consideration and consultation was made in connection with
the work area, operation and process of the constitution of
the Committee in the meeting land this decision was taken
that while convening a meeting with the Agriculturists and
their representatives affected with the acquisition, their
E opinions and demands may be known by way of receiving
representations from them and discussion may be made from
them in this regard.
In sequence of above, the meeting of Committee was convened
on 22.09.2008 and 11.10.2008 respectively in the Conference
F Room of the Greater Noida Authority, wherein, while receiving
the memo from the Agriculturists of Village and their
representatives, the matter was discussed and consulted in
detail, wherein, mainly, following people have taken part-
1. Ramesh Singh Rawal,
G 2. Yogendra Singh Rawal,
3. Subedar Ramchandra,
4. Omprakash,
5. Mahi Singh Bhati,
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 437
PRADESH [KRISHNA MURARI, J.]
6. Lokesh Bhati, A
7. Maha Singh Bhati,
8. Pratap Singh Bhati,
9. Pratap Singh Sarpanch,
10. Prem Mukhiya, B
11. Inder Singh (Advocate),
12. Ajit Singh Nagar,
13. Kamal Bhati,
C
14. Mange Ram Bharti
15. Bhule Singh,
16. Rakesh
17. Braham Singh,
D
18. Atmender,
19. Maharaj Singh,
20. Mehndi Hassan,
21. Umesh,
E
22. Vikram Singh,
23. Satbir Pradhan,
24. Naresh Upadhyay,
25. Ajith Mukhiya, F
26. Rampal Havaldar,
27. Nemvir, Pradhan, Garba
and etc. etc.
3. Grounds of the demand and memo submitted by the G
Agriculturist - There records were received in support of
detailed Memos and particulars in connection with the
demands from the Villages in their meeting by the Committee.
The agriculturist of the land acquired in the year of 2006-
2007 of Village Ghodi Bachheda and including other Villages
H
438 SUPREME COURT REPORTS [2023] 2 S.C.R.
A have collectively produced detailed and factual Memos
including necessary records before the Committee and even
grounds were also raised by the Agriculturists orally in
support of their demand, wherein, main grounds are included,
which are as under:-
B 1. The farmers of questioned Villages have given value
enhancement Memo on 2.04.2006, whereon, the Greater
Noida Development Authority gave Assurance letter in written
on 5.01.2007 after 10 days, that, after calling the rates of
Tronica City and etc. in the GDA, till the last week of the
February 2007, decision will be taken in connection with
C enhancing the compensation. In support of their statements
copy of letter dated 5.01.2007 of the Deputy Chief Executive
Officer, Greater Noida addressed to Ashok Pradhan,
respected member, Lok Sabha and Sri Nawab Singh Nagar, is
enclosed.
D 2. They had also revealed their demand in connection with
compensation enhancement in the meeting of committee
constituted under chairmanship of the Commissioner, Meerut
Division, Meerut, but nothing benefit has been given to the
Agriculturists of the acquired land in the financial year 2006-
E 2007.
3. The Villagers have produced their demand, while disclosing
detailed grounds before the Committee constituted under
chairmanship of the learned District Magistrate vide Order
dated 10.06.2008 of the Chairman and Chief Executive
F Officer, Greater Noida but, even then, the Committee, without
making intensive consideration thereon, has given
recommendation for enhancement @ Rs. 175- 200 per square
metre, which is not in practical and it is against the principle
of natural justice and that this enhancement is insufficient.
G 4. Analysis - The Notification was issued on 5.01.2006 under
Section 6/17 of the Land Acquisition Act, 1894 in the proposal
of acquisition of 580.1730 hectare land of Village Gonda
Bachheda and that the possession of the acquired land was
handed over to the Greater Noida Authority on 14.05.2006
by the Additional Collector (L A). After approving the value
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 439
PRADESH [KRISHNA MURARI, J.]
of compensation @ Rs.385 per square metre on 28.06.2006 A
from the Divisional Commissioner, Meerut, the compensation
amount was distributed @ Rs.385 per square metre to the
Ancestral Agriculturists and @ Rs.334.78 per square metre
to the ancestral Agriculturists. That the land of the following
Villages were acquired for well-planned development of the
B
Greater Noida in the Financial Years 2006-2007 including
Village Gonda, Bachada and other Villages and that the
possession of the above land was taken after 01.04.2006 and
the Agriculturists of the above land are making demand for
enhancement of compensation.
C
D
Agriculturist organization, Agriculturists of these Villagers
have also given a number of Memos for demanding
enhancement of compensation at the time of constitution of E
the Committee under chairmanship of the Divisional
Commissioner, Meerut vide Order dated 31.12.2007 of the
Government and even prior to it.
The copy of consent letter dated 5.01.2007 signed by the then
Deputy Chief Executive Officer, Greater Noida and F
consideration and consultation made on the Memos submitted
on 5.01.2007 in the matter by the Villagers with Member of
Parliament Shri Ashok Pradhan and the then MLA Shri
Nawab Singh Nagar was also provided to the agriculturists,
wherein, it is mentioned that this decision has been taken in
connection with enhancing the compensation of the acquired G
land that after calling the rates of compensation of the land
being acquired by the Ghaziabad Development Authority and
the land of Tronica City of Housing Development Board, till
the last week of February, decision will be taken in connection
H
440 SUPREME COURT REPORTS [2023] 2 S.C.R.
A with enhancing the compensation. It is clear by it that the
Agriculturists were raising demand of enhancing the
compensation even in the month of February 2007, whereon,
the Assurance was given at the Competent Level of Authority.
The Committee constituted under chairmanship of the learned
B District Magistrate has revealed the facts in detail in its report
dated 31.07.2008 on the above overall points raised by the
Agriculturists. The Committee has perused the recommendation
dated 21.07.2008 of the Committee constituted under the
chairmanship of the learned District Magistrate, Gautam
Buddha Nagar. Such finding has been concluded in its report
C dated 21.07.2008 that it is not possible to make any change
in the rate of compensation in accordance with law, because
of receiving the compensation after fulfillment of the
agreement under the Agreement Regulation after acquisition
of the land by the concerned Agriculturists, but, the Committee
D has recommended in its report dated 21.07.2008 to award
certain amount in the detailed circumstances on account of
ex-gratia.
5. Recommendation - As per the information provided by the
Special Executive Officer (L A), Greater Noida, most of the
E Agriculturist of the acquired land in the financial year 2006
2007 of Village Ghodi Bachheda, including other Villages,
as per the Government Order dated 29.09.2001, under the
provisions of Uttar Pradesh Land Acquisition (Determination
of Compensation and Declaration of Award by Agreement)
Rules, 1997, have received Compensation. Therefore, it would
F not be possible under the rule to make any enhancement/
change in the compensation rates of the award to be declared.
Accordingly, it would be appropriated only to give additional
amount on account of Ex gratia to be awarded as relief to the
Agriculturists of these Villages. In the report dated 21.07.2008
G of the Committee constituted under the chairmanship of the
learned District Magistrate, recommendation has been given
to award additional amount @ Rs.175-200 per square metre.
But, in opinion of the Committee, there is justification to make
partial enhancement in above amount.
Therefore, in view of the above detailed factual analysis,
H consultation, discussion, consideration made from the
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 441
PRADESH [KRISHNA MURARI, J.]
Agriculturists and assurance given at the level of Authority, A
this Committee is hereby made recommendation to make
payment of the amount @ Rs.310 per square metre on account
of Ex gratia to the ancestral Agriculturists of the questioned
land of 8 Villages detailed in Para No.4 possession of which
has been received in the financial year 2006-2007 and the
B
Committee is hereby further recommended to submit the
recommendation before the Greater Noida Authority Board
for necessary proceedings.
Sd/-,
Shravan Kumar Sharma, C
District Magistrate,
Gautam Buddha Nagar
Sd/-
(Pankaj Agarwal), D
Chief Executive Officer, Greater Noida
Sd/-
(Thakur Jaiveer Singh), E
Hon’ble Minister Rural Engineering Service
Agriculture Foreign Trade and
Agriculture Export, Uttar Pradesh”
F
16. Based on the aforesaid report, a decision was taken in the
74 th Board Meeting of Greater Noida for payment of additional
compensation/ex-gratia @ Rs.310 per square metre only to the ‘Pushtaini’
farmers of 8 villages.
17. The Minutes of the 74th Board Meeting of the Greater Noida
Authority dated 03.11.2008 are being reproduced hereunder :- G
“ ANNEXURE P-5
S. No.1 - For approval of minutes of 74th Board Meeting of
the authority
74th Board meeting of Authority was held on 03.11.2008. H
442 SUPREME COURT REPORTS [2023] 2 S.C.R.
A Minutes of this meeting (enclosure), has been sent to the
members of authority vide semi Government letter No.UMC/
74th Board Meeting/ 2008 / 265 dated 3.11.2008. Minutes of
the above meeting is being submitted herewith for approval
of the Authority Board.
B S.No. 9- In connection with demand of bonus/ex-gratia/
compensation enhancement of the Agriculturists of the land
of Village Ghodi Bachheda and Other Villagers acquired in
the Financial Year 2006 2007 by Greater Noida The
Agriculturists of the land of following Villagers, whose land
was acquired in the financial year 2006 -2007 by the Greater
C Noida, have submitted a lots of Memos, while making demand
of compensation enhancement-
D
E
Which have been submitted to the Government from time to
time for appropriate directions and guidelines. For
examination of the demand of compensation and management
of Agriculturist, following a Committee of District Magistrate,
F Gautam Buddha Nagar, Additional Chief Executive Officer,
Deputy Chief Executive Officer, Greater Noida was
constituted vide Order dated 10.06.2008 of the Chairman,
Greater Noida, and the above committee has recommended
to make consideration on awarding additional amount @
Rs.175- 200 per square metre to the cultivators, whose land
G was acquired in the financial year 2006, 2007, in Village
Ghodi Bachheda including other Villages, in its report dated
21.07.2008. In the 72nd meeting of the Board held on
11.08.2008, while using the Recommendation of the
Committee, this direction was given that, while making
calculation of the situation of the financial sources and its
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 443
PRADESH [KRISHNA MURARI, J.]
management, the matter may be referred to the Government, A
as per Government Order No.4/4/1/2008 - C.X. (1) Lucknow
dated 4.09.2008 of the Government of Uttar Pradesh, the
committee was constituted in connection with making
consideration on the demands of the Agriculturists in
connection with bonus / Ex gratia / compensation enhancement
B
of the enhanced rates in connection with the land of Village
Ghodi Bachheda and other Villages.
1. Sri Thakur Jaiveer Singh Hon’ble Minister, Rural
Engineering Service, Agriculture Foreign Trade and
Agriculture export -Chairman
C
2. Chief Executive Officer, Greater Noida member
3. District Magistrate, Gautam Buddha Nagar -Member
Coordinator
The committee has submitted its recommendation on
25.10.2008, wherein, the recommendation has been made to D
make payment on account of ex-gratia @ Rs.310 square metre
to the ancestral agricultural of the land whose possession
has been received in the Financial Year 2006-2007 of
1.04.2006 by the Greater Noida in respect of the land of Village
Ghodi Bachheda and recommendation has been made to E
submit the matter with recommendation of the Committee
before the Greater Noida Authority Board for necessary
proceedings. The report dated 25.10.2008 of the Committee
is enclosed and that it is a part of agenda.
Overall Compensation Amount of Rs.5522134695.00 (Rupees F
Five Arab fifty two crores twenty one lakhs thirty four thousand
six hundred ninety five only), calculated @ Rs.385 per square
metre. applied at that time against the land measuring
1434.3207 of the above Villages acquired in the financial
year 2006-2007, has already been sent to the learned
Additional District Magistrate (L.A.). And as per letter No.527/ G
8 -VK BHL a dated 23.06.2008 received from the land
acquisition officer, the amount of Rs.5,27,56,68,568 (Five
Arab Twenty seven crores, fifty six lakhs sixty eight thousand
five hundred sixty eight only), which is 95.54%, has already
been distributed among the concerned Agriculturists. As per
H
444 SUPREME COURT REPORTS [2023] 2 S.C.R.
A the information received vide letter No.833/Eight- A.D.O. (L
A) /08 dated 21.10.2008 of the Additional Collector (L.A. ),
out of the questioned acquired land of the above Villages,
the area measuring 1392.9586 hectare, is ancestral area. So,
in case of making payment at the enhanced rates to the
ancestral Agriculturist, that is, on making payment @ Rs.310
B
per square metre as recommended by the Committee, then,
their shall financial burden of Rs.4318171660 (Rupees four
Arab twenty one crores eighty one lakhs seventy one thousand
six hundred and sixty only).
The report of the Committee is submitted for consideration of
C the Authority Board.”
18. Vide order dated 15.01.2009, the State Government granted
its approval for payment of enhanced compensation/ex-gratia/bonus to
the ‘Pushtaini’ landholders.
D 19. For the sake of convenience, the break-up of compensation
granted to both the categories of landowners is being produced
hereunder:-
E
F
G
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 445
PRADESH [KRISHNA MURARI, J.]
ARGUMENTS ADVANCED BY THE APPELLANTS A
20. The learned Counsel for the Appellants Contended that:-
I. Section 23 of the Land Acquisition Act does not allow for a
discrimination between Pushtaini and Gair-pushtaini
landowners in determination of compensation under the Land
Acquisition Act. B
I. In light of the law laid down by this Court in the Nagpur
Improvement Trust Case (Supra), no distinction between
the abovementioned two sets of classes of landowners can
be made on the basis of the date of purchase of the land
and the date of establishment of G NOIDA. The Ld. C
Counsel argued that all the landowners whose land was
acquired should stand on the same pedestal.
II. The Land of both the classes of landowners have been
acquired under the same procedure, for the same public
purpose and having the same market value, and hence, any D
difference in the rate of compensation provided to any party
is highly discriminatory and is violative of Article 14.
III. Further, it has also been argued that merely by signing the
agreement, the Appellants herein cannot be said to have
waived their right to Appeal the compensation, especially E
since the fact that the ex-gratia payment granted to the
Pushtaini landowners was awarded after the agreement
was signed.
IV. It has also been contended that the ex-gratia payment as a
form of compensation does not exist in the Land Acquisition F
Act, and can only be interpreted as one of the reasons for
payment within Section 23 of the Land Acquisition Act, and
in such a scenario, the payment must be universally made
to all parties.
ARGUMENTS ADVANCED BY THE RESPONDENTS G
21. The Ld. Counsel for the Respondents Contended that:
I. The UP Land Acquisition Rules have been formed under
the Land Acquisition Act,1894. These rules prescribe for
method of compensation between the acquirer and the
H
446 SUPREME COURT REPORTS [2023] 2 S.C.R.
A acquiree through an agreement. The Appellants, by way of
an agreement, voluntarily accepted the compensation being
granted to them. Further, while accepting the compensation,
the Appellants herein also submitted an Affidavit stating
that the compensation is agreed upon and accepted by the
parties. It was only three years later that the Appellants
B
decided to file a writ challenging the compensation, after
entering into the agreement and explicitly agreeing to the
compensation amount.
II. The Appellants had entered into an agreement as per the
law of the land and had accepted the compensation granted
C to them. In such a scenario, there exists no legal remedy of
the Appellants to re-open the agreement on grounds of a
subsequent increase in compensation to a different party.
There is no remedy to re-open the agreement by way of
approaching the Court in the statue.
D III. The distinction created between the two classes of land
owners has been done on the basis of their residence. The
base compensation given to both the classes is the same,
and only an additional 15% extra amount is given to
Pushtaini landowners as rehabilitation bonus, which is not
E a necessity for the Gair-pushtaini landowners as they do
not reside in the concerned land and are not sons of the
soil.
IV. As regards to the ex-gratia payment given to the Pushtaini
landowners, the same is merely an additional compensation
F based on the classification between sons of the soils and
mere investors in the land. The payment is based on
reasonable classification and is not violative of Article 14.
Issues
22. In the aftermath of the aforesaid litigations in the High Court,
G the following three questions arise for adjudication in these Appeals :-
I. Whether the Appellants, by signing the agreement,have
waived their right to seek for revised compensation?
II. Whether the classification made under the Land Acquisition
Act, and the UP Land Acquisition Rules,1997 between
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 447
PRADESH [KRISHNA MURARI, J.]
Pushtaini Landowners and Gair-pushtaini Landowners for A
the payment of compensation at different rates is liable to
be struck down as violative of Article 14 of the Constitution?
III. Whether the classification made by the Full-Bench of the
High Court between Pushtaini landowners and Gair-pushtaini
landowners is in contravention to the law laid down by this B
Hon’ble Court in the case of Nagpur Improvement Trust
and Another vs. Vithal Rao and Others (1973) 1 SCC 500?
23. We have heard, Shri Pradeep Kant, Learned Senior Counsel
for the appellants, Shri. Ravindra Kumar, learned Senior Counsel
appearing for the Greater Noida and Shri Ravindra Kumar Raizada, C
learned counsel for the State of U.P./A.A.G., at great length.
24. At the outset, we would like to clarify that in the present appeals,
we are only concerned with the legality and validity of action of G. Noida
paying an enhanced compensation to the landholders by carving out an
artificial class of ‘Pushtaini’ landholders from among the same class of D
landholders whose land was acquired by the same notification for the
same purpose. There is no challenge to the validity of the acquisition
itself as the same stands finally settled by this Court.
Analysis
E
Whether the Appellants are bound by the compensation as
per the agreement under the Land Acquisition rules, and
have waived off their right to seek enhanced compensation?
25. It has been vehemently submitted on behalf of Greater Noida
that the appellants herein did not exhaust their remedy under Section 18 F
of the Land Acquisition Act and approach the High Court, and has
sidestepped a procedural requirement. Section 18 of the 1894 Act reads
as under :-
“Reference to Court.- (1) Any person interested who has not
accepted the award may, by written application to the Collector, G
require that the matter be referred by the Collector for the
determination of the Court, whether his objection be to the
measurement of the land, the amount of the compensation,
the persons to whom it is payable, or the apportionment of
the compensation among the persons interested.
H
448 SUPREME COURT REPORTS [2023] 2 S.C.R.
A (2) The application shall state the grounds on which objection
to the award is taken: Provided that every such application
shall be made,
(a) if the person making it was present or represented before
the Collector at the time when he made his award, within six
B weeks from the date of the Collector’s award;
(b) in other cases, within six weeks of the receipt of the notice
from the Collector under section 12, sub-section (2), or within
six months from the date of the Collector’s award, whichever
period shall first expire.”
C 26. The first and foremost thing to be taken note of is that the
nature of the challenge in the Writ Petition filed by the appellants before
the High Court was based on violation of Article 14, which is a fundamental
right enshrined in the Constitution. Such a challenge, irrespective of the
existence of any alternative remedy under a statute cannot put a bar on
D the jurisdiction of the Constitutional Courts.
27. The Respondent Authority argued that since the agreement
was consented to, no challenge could exist in the Court. This argument
in the facts of the case, has been raised only to be rejected. The issue
involved in adjudication is not in respect of an agreement entered into by
E the appellants. Similar agreements were also entered into with the
Authority by such identically situated landholders who have been granted
additional compensation subsequent to the agreement by carving out a
distinction on the basis of period of residence/occupation of the land
which was acquired by creating an artificial classification of ‘Pushtaini’
and ‘Gair-Pushtaini’ landholders.
F
28. Furthermore, since the issue of additional compensation by
making an artificial classification of ‘pushtaini’ and ‘Gair-pushtani’ was
not in existence at the time of the agreement, there was no occasion to
challenge the same.
29. Further, specifically in the context of the grant of ex-gratia
G
payment, it is to be noted that the said payment granted to Pushtaini
landowners through a separate notification, was assessed, and given,
after the agreement was signed by both, Pushtaini and Gair-pushtaini
Landowners. The Appellants herein, under those circumstances, could
not have challenged the agreement vis a vis the ex-gratia payment on
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 449
PRADESH [KRISHNA MURARI, J.]
grounds of violation of Article 14, when no such violation existed at the A
time of the agreement. No man can be expected to predict a future
violation of their rights and file a pre-emptive appeal. This Court is
reminded of the words of Francis Bacon, who in the 17th century wrote
about the link between legal certainty and justice:
“For if the trumpet give an uncertain sound, who shall prepare B
himself to the battle? So if the law give an uncertain sound,
who shall prepare to obey it? It ought therefore to warn before
it strikes... Let there be no authority to shed blood; nor let
sentence be pronounced in any Court upon cases, except
according to a known and certain law Nor should a man be
deprived of his life, who did not first know that he was risking C
it.’ (Quoted in Coquillette, Francis Bacon pp 244 and 248,
from Aphorism 8 and Aphorism 39? A Treatise on Universal
Justice).”
30. On the basis of the above-mentioned reasons, we are of the
considered opinion that the Appellants, because of their signing of the D
agreement, have not forfeited their right to seek revised compensation,
because ,the cause of action accrued to them much after entering into
the agreement. The issue no. 1 is answered accordingly in the negative
and in favour of the Appellants.
Whether the classification made by and executive fiat E
between Pushtaini Landowners and Gair-pushtaini
Landowners for payment of compensation at different rates
is liable to be struck down as violative of Article 14 of the
Constitution?
31. The High Court, while upholding the classification between F
‘Pushtaini’ and ‘Gair-pushtaini’ landowners, stated that there is no
discrimination being caused to similarly situated parties, and the judgment
rendered by the Division Bench in the case of Smt. Madhuri Srivastava
(Supra) lays down the correct law. Thus, the Full Bench upheld the
classification and negated the challenge made to the said classification. G
The relevant paragraphs of the impugned judgment are reproduced
hereunder :-
“Before coming on merits of the case, it would be appropriate
to state that sovereign power of state to acquire private
property for public purpose is based upon maxim “salus
H
450 SUPREME COURT REPORTS [2023] 2 S.C.R.
A populi est suprema lax” means welfare of the public is
paramount law and maxim “necessita publica major est quam
privata” means public necessity is greater than private. The
maxim “eminent domain” (sabai bhumi Govind Ki) means state
is supreme owner of the land. Constitution of India
incorporates these maxims. Acquisition of private property
B
can be made by legislation, exercising powers under Articles
245 and 246 of the Constitution. Subject “acquisition and
requisition of property for the purposes of the Union” was
mentioned as Entry No. 33 of List-I and “acquisition and
requisition of property except for the purposes of the Union”
C was mentioned as Entry No. 36 of List-II of the Seventh
Schedule of Constitution. By Section 26 of Constitution
(Seventh Amendment) Act, 1956, Entry No. 33 of List-I and
Entry No. 36 of List-II were deleted and Entry No. 42 of List-
III of Seventh Schedule of the Constitution was amended as
“acquisition and requisition of property”. Acquisition of
D
private parties can be made by exercise of executive power
under Article 298 of Constitution. Union of India and State
Governments can acquire private property, exercising
legislative or executive powers.
While dealing with an issue pertaining to classification and
E its reasonability, we must also keep in mind that the governance
is not a simple thing. It encounters and deals with the problems
which come from persons in an infinite variety of relations.
Classification is the recognition of those relations, and, in
making it a wide latitude of discretion and judgment must be
F given.
Having considered all aspects of the matter by keeping in
mind the Constitutional provisions discussed above and also
the intent of the Act, 1894 especially the provisions of Sections
23 and 24 of the Act, 1894, we are of considered opinion that
G the classification introduced among the Pushtaini and Gair-
pushtaini farmers is reasonable with intelligible differentia
and that in no manner causes any discrimination among the
similarly situated person. The law laid down in the case of
Smt. Madhuri Srivastava (supra) has taken adequate care of
all these provisions while concluding that the Pushtaini and
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 451
PRADESH [KRISHNA MURARI, J.]
Gairpushtaini farmers are two different classes and the A
resolution to award additional compensation on different rates
is not at all discriminatory.”
32. To assess the validity of the impugned classification, we must
put it through the rigours of Article 14 and see whether it survives the
baptism. It is a well established principle of law, that the state, as per B
Article 14, cannot deny equality before law and equal protection of the
law.
REASONABLE CLASSIFICATION TEST
33. For any classification to survive the test of Article 14, the
classification must be based on intelligible differentia, and it must have a C
rational nexus to the object sought to be achieved by the law. At this
stage, it is important to note that the object sought to be achieved must
also be lawful, and if the object of the law itself is found to be
discriminatory, then such discrimination must be struck down. This has
been held in a catena of judgments. D
34. The reasonable classification test was first introduced to Indian
Jurisprudence in the case of State Of West Bengal Vs. Anwar Ali
Sarkar7 . The issue raised therein was against the Bengal Special Courts
Act which was enacted for the purpose of speedier trial of certain
offences. This Act was challenged on the touchstone of Article 14 on E
grounds of the Act giving arbitrary powers to the state government. The
Court, while dismissing the appeal of the state held that:-
“It can be taken to be well settled that the principle underlying
the guarantee in Article 14 is not that the same rules of law
should be applicable to all persons within the Indian territory F
or that the same remedies should be made available to them
irrespective of differences of circumstances [Charanjit Lal
Chowdhury v. Union of India, 1950 SCR 869 : 1950 SCC
833] . It only means that all persons similarly circumstanced
shall be treated alike both in privileges conferred and
liabilities imposed [Old Dearborn Distributing Co. v. Seagram G
Distillers Corpn., 81 L Ed 109 : 299 US 183 (1936) : 1936
SCC OnLine US SC 145] . Equal laws would have to be applied
to all in the same situation, and there should be no
discrimination between one person and another if as regards
7
(1952) AIR 75 H
452 SUPREME COURT REPORTS [2023] 2 S.C.R.
A the subjectmatter of the legislation their position is
substantially the same. This brings in the question of
classification. As there is no infringement of the equal
protection rule, if the law deals alike with all of a certain
class, the legislature has the undoubted right of classifying
persons and placing those whose conditions are substantially
B
similar under the same rule of law, while applying different
rules to persons differently situated. It is said that the entire
problem under the equal protection clause is one of
classification or of drawing lines [ Dowling : Cases on
Constitutional Law, 4th Edn. 1139.] . In making the
C classification the legislature cannot certainly be expected to
provide “abstract symmetry”. It can make and set apart the
classes according to the needs and exigencies of the society
and as suggested by experience. It can recognise even
“degrees of evil” [Skinner v. Oklahoma, 86 L Ed 1655 : 316
US 535 at p. 540 (1942) : 1942 SCC OnLine US SC 125] ,
D
but the classification should never be arbitrary, artificial or
evasive. It must rest always upon real and substantial
distinction bearing a reasonable and just relation to the thing
in respect to which the classification is made; and
classification made without any reasonable basis should be
E regarded as invalid [Southern Railway Co. v. Greene, 54 L
Ed 536 : 216 US 400 at p. 412 (1910) : 1910 SCC OnLine
US SC 59] . These propositions have not been controverted
before us and it is not disputed also on behalf of the
respondents that the presumption is always in favour of the
constitutionality of an enactment and the burden is upon him
F
who attacks it, to show that there has been transgression of
constitutional principles.
I am not at all impressed by the argument of the learned
Attorney General that to enable the respondents to invoke
the protection of Article 14 of the Constitution it has got to be
G shown that the legislation complained of is a piece of “hostile”
legislation. The expressions “discriminatory” and “hostile”
are found to be used by American Judges often simultaneously
and almost as synonymous expressions in connection with
discussions on the equal protection clause. If a legislation is
H discriminatory and discriminates one person or class of
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 453
PRADESH [KRISHNA MURARI, J.]
persons against others similarly situated and denies to the A
former the privileges that are enjoyed by the latter, it cannot
but be regarded as “hostile” in the sense that it affects
injuriously the interests of that person or class. Of course, if
one’s interests are not at all affected by a particular piece of
legislation, he may have no right to complain. But if it is
B
established that the person complaining has been
discriminated against as a result of legislation and denied
equal privileges with others occupying the same position, I
do not think that it is incumbent upon him, before he can
claim relief on the basis of his fundamental rights, to assert
and prove that in making the law, the legislature was actuated C
by a hostile or inimical intention against a particular person
or class. For the same reason I cannot agree with the learned
Attorney General that in cases like these, we should enquire
as to what was the dominant intention of the legislature in
enacting the law and that the operation of Article 14 would
D
be excluded if it is proved that the legislature had no intention
to discriminate, though discrimination was the necessary
consequence of the Act. When discrimination is alleged against
officials in carrying out the law, a question of intention may
be material in ascertaining whether the officer acted mala
fide or not [Sunday Lake Iron Co. v. Wakefield, 62 L Ed 1154 E
: 247 US 350 (1918) : 1918 SCC OnLine US SC 148] ; but
no question of intention can arise when discrimination follows
or arises on the express terms of the law itself .”
35. In the case of Rustom Cavasjee Cooper (Banks
Nationalisation) v. Union of India8, R.C.Cooper, who was the director F
of Central Bank of India filed a petition against the Union of India
challenging the provisions of The Banking Companies (Acquisition and
Transfer of Undertakings) Ordinance, 1969. The Court while deciding
this case held that it cannot overlook the violation of fundamental rights
of the citizens on mere technicalities. It then further went on to state
that the Courts won’t look into the objects of the impugned act and G
rather they will look into the effect of the impugned act. The Court
found the said Act in clear violation of Article 14 since only 14 banks
were restrained from conducting banking business in the future while
8
(1970) 1 SCC 248
H
454 SUPREME COURT REPORTS [2023] 2 S.C.R.
A other banks including foreign banks were allowed to continue Banking
in India. It has been observed in the said case as under :-
“By article 14 of the Constitution the State is enjoined not to
deny to any person equality before the law or the equal
protection of the laws within the territory of India. The Article
B forbids class legislation, but not reasonable classification in
making laws. The test of permissible classification under an
Act lies in two cumulative conditions: (1) classification under
the Act must be founded on an intelligible differentia
distinguishing persons, transactions or things grouped
together from others left out of the group; (ii) the differential
C has a rational relation to the object sought to be achieved by
the Act: there must be a nexus between the basis of
classification and the object of the Act.
The legislative policy as to the necessity is a matter of
legislative judgment and the Court will not examine the
D propriety of it. The legislation need not be all embracing and
it is for the Legislature to determine what categories will be
embraced. In Dalmia case (Ram Krishna Dalmia v. S.R.
Tendolkar, 1959 SCR 279) it was said that the two tests of
classification were first that there should be an intelligible
E differentia which distinguished persons or things grouped
from others left out and secondly the differentia must have a
rational relation to the object sought to be achieved by the
statute”
36. Most recently, a Constitution Bench of this Court in the case
F of Navtej Singh Johar & Ors. Vs. Union of India Thr. Secretary,
Ministry of Law and Justice9, while considering the question of
scrapping Section 377, IPC as violative of Article 14 has detailed out the
test of reasonable classification under Article 14 as under :-
“We, first, must test the validity of Section 377 IPC on the
G anvil of Article 14 of the Constitution. What Article 14
propounds is that “all like should be treated alike”. In other
words, it implies equal treatment for all equals. Though the
legislature is fully empowered to enact laws applicable to a
particular class, as in the case at hand in which Section 377
9
H (2018) 10 SCC 1
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 455
PRADESH [KRISHNA MURARI, J.]
applies to citizens who indulge in carnal intercourse, yet the A
classification, including the one made under Section 377 IPC,
has to satisfy the twin conditions to the effect that the
classification must be founded on an intelligible differentia
and the said differentia must have a rational nexus with the
object sought to be achieved by the provision, that is, Section
B
377 IPC.
Section 377 has consigned a group of citizens to the margins. It
has been destructive of their identities. By imposing the sanctions
of the law on consenting adults involved in a sexual relationship, it
has lent the authority of the State to perpetuate social stereotypes
and encourage discrimination. Gays, lesbians, bisexuals and C
transgenders have been relegated to the anguish of closeted
identities. Sexual orientation has become a target for
exploitation, if not blackmail, in a networked and digital age.
The impact of Section 377 has travelled far beyond the
punishment of an offence. It has been destructive of an identity D
which is crucial to a dignified existence”
37. In the case at hand, it has been held by the Full Bench of the
High Court that the classification between Pushtaini and Gair-pushtaini
Landowners is based on one class of landowners being sons of the soil,
while the other class being mere landowners, who are not directly E
attached to the land. Further, the object of this classification, as stated
by the full bench of the High Court, is to rehabilitate the original residents,
i.e the sons of the soil, who are likely to become landless due to the
acquisition of their land.
38. While prima facie, the classification and the object sought to F
be achieved through the said classification seems reasonable, however,
the devil lies in the details. The justification given by the GNOIDA
Authority, and the Full-bench of the High Court assumes that only
Pushtaini landowners permanently reside in the subject land or that the
subject land is the primary source of income only for Pushtaini
landowners, and this assumption has been backed by no empirical data G
produced by the authority.
39.While the classification made by Greater Noida has been based
on the object of giving fair compensation, however, such a laudable object
of the classification would stand breached by the effects of such a
classification, creating a dissonance between the object and its effect. H
456 SUPREME COURT REPORTS [2023] 2 S.C.R.
A Many Gair-pushtaini landholders, whose main area of residence or their
main source of income is also the subject land, would be subject to great
discrimination and injustice, if the same compensation that has been
granted to the pushtaini landholders is not extended to them.
40. Further, it is also to be noted that this Court at this stage cannot
B enter into a fact finding mission to verify the claims of the respondent
authority. To justify such a classification, the respondent authority should
have discharged their burden of proof to back their claim. Mere statements
without any evidence cannot be accepted by us as justification for the
said classification, which can have a debilitating effect on those who are
at the losing side of the classification.
C 41. To survive the rigors of Article 14, the impugned classification
must not only make it through the abovementioned test, but also clear
the Wednesbury Principle, and by extension the Proportionality test.
WEDNESBURY PRINCIPLE
42. In the case of Associated Provincial Picture Houses Limited
D v. Wednesbury Corporation10, the King’s Bench Division was tasked
with the question of under what circumstances can the Court interfere
in cases of administrative law making. While dealing with this, the Court
held that interference in administrative decisions was permissible, only if
(i) the order was contrary to law (ii) or relevant factors were not
E considered, or (iii) irrelevant factors were considered or, (iv) or the
decision was such that no other authority under similar circumstances
would have come to this conclusion. The relevant paragraph of the
judgment are reproduced herein:
“In the result, this appeal must be dismissed. I do not wish to
repeat myself but I will summarize once again the principle
F
applicable. The Court is entitled to investigate the action of
the local authority with a view to seeing whether they have
taken into account matters which they ought not to take into
account, or, conversely, have refused to take into account or
neglected to take into account matters which they ought to
G take into account. Once that question is answered in favour
of the local authority, it may be still possible to say that,
although the local authority have kept within the four corners
of the matters which they ought to consider, they have
nevertheless come to a conclusion so unreasonable that no
10
H [1948] 1 KB 223
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 457
PRADESH [KRISHNA MURARI, J.]
reasonable authority could ever have come to it. In such a A
case, again, I think the Court can interfere.
The power of the Court to interfere in each case is not as an
appellate authority to override a decision of the local
authority, but as a judicial authority which is concerned, and
concerned only, to see whether the local authority have B
contravened the law by acting in excess of the powers which
Parliament has confided in them. The appeal must be dismissed
with costs.”
43. The Wednesbury principle was first introduced to Indian
Jurisprudence in the case of Om Kumar & Ors. Vs. Union Of India11. C
Here, again, a similar question was posed before the Supreme Court, as
to when can the Court exercise its power of judicial review in cases of
executive law making. This Court, reiterated the same principles laid
down in the Wednesbury case. The relevant extracts from the said
judgment is reproduced hereunder:-
D
“Lord Greene said in 1948 in the Wednesbury case [(1948) 1
KB 223 : (1947) 2 All ER 680 (CA)] that when a statute gave
discretion to an administrator to take a decision, the scope of
judicial review would remain limited. He said that interference
was not permissible unless one or the other of the following
conditions was satisfied, namely the order was contrary to E
law, or relevant factors were not considered, or irrelevant
factors were considered; or the decision was one which no
reasonable person could have taken. These principles were
consistently followed in the UK and in India to judge the
validity of administrative action.” F
44. The classification made by GNOIDA does not find its footing
in the Land Acquisition Act, or the UP-Land Acquisition Rules, and hence
is contrary to law. The said classification also suffers from not taking
into account relevant considerations. The Authority, without taking into
account any empirical data, or calculating any possibility of Gair-
G
pushtaini landowners being rendered landless or without a primary
source of income, made the impugned classification. These relevant
factors, by not being taken into account, can and would cause great
injustice to Gair-pushtaini landowners.
11
(2001) 2 SCC 386
H
458 SUPREME COURT REPORTS [2023] 2 S.C.R.
A 45. Further, GNOIDA, by arbitrarily classifying the landowners
as Pushtaini and Gair-pushtaini on the basis of a cut-off date, have
taken into account an irrelevant factor. The cut-off date by itself, without
any context of the landowners on ground, is not indicative of who the
most adversely affected landowners are. By not complying with these
three factors while making the classification, this Court must strike down
B
such a classification.
46. While the Wednesbury principle has been used as a guiding
principle of interpretation, the Indian Court have now adopted a much
more rigorous test, i.e., is proportionality test, to see whether an
C administrative action can survive the rigours of Article 14.
PROPORTIONALITY TEST
47. In the case of Om Kumar (Supra), this Court held that the
administrative measure must not be more drastic than is necessary for
D attaining the desired result. This was the first formal introduction of the
Proportionality test to Indian Jurisprudence, however the Court pointed
out that the proportionality test has been used by the Indian Courts even
before this judgment. The relevant paragraphs from the said report reads
as under :-
E “27.The principle originated in Prussia in the nineteenth
century and has since been adopted in Germany, France and
other European countries. The European Court of Justice at
Luxembourg and the European Court of Human Rights at
Strasbourg have applied the principle while judging the
validity of administrative action. But even long before that,
F the Indian Supreme Court has applied the principle of
“proportionality” to legislative action since 1950, as stated
in detail below.
28. By “proportionality”, we mean the question whether, while
G regulating exercise of fundamental rights, the appropriate or
least-restrictive choice of measures has been made by the
legislature or the administrator so as to achieve the object of
the legislation or the purpose of the administrative order, as
the case may be. Under the principle, the Court will see that
the legislature and the administrative authority “maintain a
H proper balance between the adverse effects which the
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 459
PRADESH [KRISHNA MURARI, J.]
legislation or the administrative order may have on the rights, A
liberties or interests of persons keeping in mind the purpose
which they were intended to serve”. The legislature and the
administrative authority are, however, given an area of
discretion or a range of choices but as to whether the choice
made infringes the rights excessively or not is for the Court.
B
That is what is meant by proportionality.
29.The above principle of proportionality has been applied
by the European Court to protect the rights guaranteed under
the European Convention for the Protection of Human Rights
and Fundamental Freedoms, 1950 and in particular, for C
considering whether restrictions imposed were restrictions
which were “necessary” — within Articles 8 to 11 of the said
Convention [corresponding to our Article 19(1)] and to find
out whether the restrictions imposed on fundamental freedoms
were more excessive than required. (Handyside v. UK [(1976)
1 EHR 737] ). Articles 2 and 5 of the Convention contain D
provisions similar to Article 21 of our Constitution relating to
life and liberty. The European Court has applied the principle
of proportionality also to questions of discrimination under
Article 14 of the Convention (corresponding to Article 14 of
our Constitution). (See European Administrative Law by J. E
Schwarze, 1992, pp. 677-866).
30. On account of a Chapter on Fundamental Rights in Part
III of our Constitution right from 1950, Indian Courts did not
suffer from the disability similar to the one experienced by
English Courts for declaring as unconstitutional legislation F
on the principle of proportionality or reading them in a manner
consistent with the charter of rights. Ever since 1950, the
principle of “proportionality” has indeed been applied
vigorously to legislative (and administrative) action in India.
While dealing with the validity of legislation infringing G
fundamental freedoms enumerated in Article 19(1) of the
Constitution of India — such as freedom of speech and
expression, freedom to assemble peaceably, freedom to form
associations and unions, freedom to move freely throughout
the territory of India, freedom to reside and settle in any part
H
460 SUPREME COURT REPORTS [2023] 2 S.C.R.
A of India, — this Court has occasion to consider whether the
restrictions imposed by legislation were disproportionate to
the situation and were not the least restrictive of the choices.
The burden of proof to show that the restriction was
reasonable lay on the State. “Reasonable restrictions” under
Articles 19(2) to (6) could be imposed on these freedoms only
B
by legislation and Courts had occasion throughout to consider
the proportionality of the restrictions. In numerous judgments
of this Court, the extent to which “reasonable restrictions”
could be imposed was considered. In Chintamanrao v. State
of M.P. [1950 SCC 695 : AIR 1951 SC 118 : 1950 SCR 759]
C Mahajan, J. (as he then was) observed that “reasonable
restrictions” which the State could impose on the fundamental
rights “should not be arbitrary or of an excessive nature,
beyond what is required in the interests of the public”.
31. “Reasonable” implied intelligent care and deliberations,
D that is, the choice of a course which reason dictated.
Legislation which arbitrarily or excessively invaded the right
could not be said to contain the quality of reasonableness
unless it struck a proper balance between the rights
guaranteed and the control permissible under Articles 19(2)
E to (6). Otherwise, it must be held to be wanting in that quality.
Patanjali Sastri, C.J. in State of Madras v. V.G. Row [(1952)
1 SCC 410 : AIR 1952 SC 196 : 1952 SCR 597 : 1952 Cri LJ
966] , observed that the Court must keep in mind the “nature
of the right alleged to have been infringed, the underlying
purpose of the restrictions imposed, the extent and urgency
F
of the evil sought to be remedied thereby, the disproportion
of the imposition, the prevailing conditions at the time”. This
principle of proportionality vis-àvis legislation was referred
to by Jeevan Reddy, J. in State of A.P. v. McDowell & Co.
[(1996) 3 SCC 709] recently. This level of scrutiny has been
G a common feature in the High Court and the Supreme Court
in the last fifty years. Decided cases run into thousands.
32. So far as Article 14 is concerned, the Courts in India
examined whether the classification was based on intelligible
differentia and whether the differentia had a reasonable nexus
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 461
PRADESH [KRISHNA MURARI, J.]
with the object of the legislation. Obviously, when the Courts A
considered the question whether the classification was based
on intelligible differentia, the Courts were examining the
validity of the differences and the adequacy of the differences.
This is again nothing but the principle of proportionality.
There are also cases where legislation or rules have been B
struck down as being arbitrary in the sense of being
unreasonable [see Air India v. Nergesh Meerza [(1981) 4 SCC
335 : 1981 SCC (L&S) 599] (SCC at pp. 372-373)]. But this
latter aspect of striking down legislation only on the basis of
“arbitrariness” has been doubted in State of A.P. v. McDowell
C
and Co. [(1996) 3 SCC 709] .
33. In Australia and Canada, the principle of proportionality
has been applied to test the validity of statutes [see Cunliffe
v. Commonwealth [(1994) 58 Aust LJ 791] Aust LJ (at 827,
839) (799, 810, 821)]. In R. v. Oakes [(1986) 26 DLR (4th) D
200] Dickson, C.J. of the Canadian Supreme Court has
observed that there are three important components of the
proportionality test. First, the measures adopted must be
carefully designed to achieve the objective in question. They
must not be arbitrary, unfair or based on irrational
E
considerations. In short, they must be rationally connected
to the objective. Secondly, the means, must not only be
rationally connected to the objective in the first sense, but
should impair as little as possible the right to freedom in
question. Thirdly, there must be “proportionality” between
the effects of the measures and the objective. See also Ross v. F
Brunswick School Dishut No. 15 [(1996) 1 SCR 825] (SCR
at p. 872) referring to proportionality. English Courts had no
occasion to apply this principle to legislation. The aggrieved
parties had to go to the European Court at Strasbourg for a
declaration. G
34. In U.S.A., in City of Boerne v. Flores [(1997) 521 US
507] the principle of proportionality has been applied to
legislation by stating that “there must be congruence and
proportionality between the injury to be prevented or remedied
and the means adopted to that end”. H
462 SUPREME COURT REPORTS [2023] 2 S.C.R.
A 35. Thus, the principle that legislation relating to restrictions
on fundamental freedoms could be tested on the anvil of
“proportionality” has never been doubted in India. This is
called “primary” review by the Courts of the validity of
legislation which offended fundamental freedoms.
B xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
45. Under Article 3(1) of the Human Rights Act, 1998 the
English Court can now declare the legislative action as
incompatible with the rights and freedoms referred to in the
schedule. The Minister is then to move Parliament for
C
necessary amendment to remove the incompatibility. While
doing so, the English Court, can now apply strict scrutiny or
proportionality to legislative and administrative action. The
principle is now treated as central to English law (See Human
Rights Law and Practice by Lord Lester of Herne Hill, Q.C.
D & David Pannick QC, 1999, para 3.16). The more the
threshold of Wednesbury irrationality is lowered when
fundamental human rights are on play, the easier it will become
to establish judicial review as an effective remedy with Article
13 of the 1998 Act (see, ibid, Supplement August, 2000, para
4.13.12).
E
48. This test of proportionality has been developed by the Indian
Courts throughout the years and has now attained the form of a five-
pronged test, as stated in the K. S. Puttaswamy & Anr. Vs. Union of
India & Ors.12 judgment, and more recently, in the Gujarat Mazdoor
F Sabha & Anr. Vs. State of Gujarat13.
49. In K.S.Puttaswamy (Supra), a nine-Judge Bench of this Court
while deciding the question as to whether the Constitution of India
guarantees to each individual a fundamental right to privacy, expounded
the ‘principle of proportionality and legitimacy’ in relation to infringement
G of rights as a result of State measures. It was held that proportionality is
essential for protection from arbitrary State action as it ensures that the
nature and quality of the encroachment on the right is in proportion to
12
(2017) 10 SCC 1
13
(2020) 10 SCC 459
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 463
PRADESH [KRISHNA MURARI, J.]
the purpose of law. While summarizing the aforementioned principle A
into a four-pronged test, the Bench held:
“…The action must be sanctioned by law;
The proposed action must be necessary in a democratic society
for a legitimate aim; B
The extent of such interference must be proportionate to the
need for such interference;
There must be procedural guarantees against abuse of such
interference.” C
50. In the case of Gujrat Mazdoor Sabha (Supra) during covid-
19, the Central Government had passed a notification severely affecting
the pay of unskilled workers, on the grounds of national emergency.
This notification was challenged on grounds of violation of Article 14,
specifically in violation of the principle of proportionality. The Court held D
that, in order to determine the validity of state action that could infringe
on fundamental rights, it must pass the following conditions, namely, (i)
The interfering with the fundamental rights must have a state purpose,
(ii) the said rights infringing measure must be based on a rational nexus
between the interference and the state aim,(iii) the measures bust be
E
necessary to achieve the state aim,(iv) the restrictions must be necessary
to protect the legitimate objective and (v) The state should provide
sufficient safeguards for the possibility of an abuse of such rights infringing
interference. On the basis of these conditions of proportionality, this Court
struck down the notification.
F
51. Although the fifth prong, as mentioned in the Gujarat Mazdoor
Sabha (Supra) has not been expressly mentioned in Puttaswamy,
Chandrachud J (as His Lordship then was), in our view, rightly has read
that in in the Gujarat Mazdoor Sabha case (supra) to complete the
test. State action that leaves sufficient room for abuse, thereby acting as
a threat against free exercise of fundamental rights, ought to necessarily G
be factored in in the delicate balancing act that the judiciary is called
upon to do in determining the constitutionality of such state action -
whether legislative, executive, administrative or otherwise. The relevant
paragraph of the judgment has been mentioned herein:
H
464 SUPREME COURT REPORTS [2023] 2 S.C.R.
A “The principle of proportionality has been recognized in a
slew of cases by this Court, most notably in the seven-judge
bench decision in K S Puttaswamy vs. Union of India. The
principle of proportionality envisages an analysis of the
following conditions in order to determine the validity of state
B action that could impinge on fundamental rights:
(i) A law interfering with fundamental rights must be in
pursuance of a legitimate state aim;
(ii) The justification for rights-infringing measures that
interfere with or limit the exercise of fundamental rights and
C
liberties must be based on the existence of a rational
connection between those measures, the situation in fact and
the object sought to be achieved;
(iii) The measures must be necessary to achieve the object
D and must not infringe rights to an extent greater than is
necessary to fulfil the aim;
(iv) Restrictions must not only serve legitimate purposes; they
must also be necessary to protect them; and
E (v) The State should provide sufficient safeguards against the
abuse of such interference.
We are unable to find force in the arguments of the learned
counsel for the Respondent. The impugned notifications do
not serve any purpose, apart from reducing the overhead costs
F of all factories in the State, without regard to the nature of
their manufactured products. It would be fathomable, and
within the PART G 30 realm of reasonable possibility during
a pandemic, if the factories producing medical equipment such
as life-saving drugs, personal protective equipment or
G sanitisers, would be exempted by way of Section 65(2), while
justly compensating the workers for supplying their valuable
labour in a time of urgent need. However, a blanket
notification of exemption to all factories, irrespective of the
manufactured product, while denying overtime to the workers,
is indicative of the intention to capitalize on the pandemic to
H
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 465
PRADESH [KRISHNA MURARI, J.]
force an already worndown class of society, into the chains A
of servitude.”
52. We have already in the discussion for the reasonable
classification test held that the interfering law, i.e. the impugned notification
that creates the classification, does not have a rational nexus to the
object sought to be achieved, and thus, violates the first two prongs of B
the proportionality test.
53. We then come to the third and fourth prong of the proportionality
test, i.e whether the classification created by the Authority was a
necessity to achieve the state aim of compensating those landowners
C
that are either direct residents of the land or the land exists as their
primary source of income and whether such measure was proportional
to the object sought to be achieved. For this, it is pertinent to refer to
Section 23 of the Act, which provides for matters to be taken into account
while determining the compensation. The said Section reads as under : -
D
“23. Matters to be considered in determining compensation.
-
(1) In determining the amount of compensation to be awarded
for land acquired under this Act, the Court shall take into
consideration E
first, the market value of the land at the date of the publication
of the [notification under section 4, sub-section (1)];
secondly, the damage sustained by the person interested, by
reason of the taking of any standing crops trees which may F
be on the land at the time of the Collector’s taking possession
thereof;
thirdly, the damage (if any) sustained by the person interested,
at the time of the Collector’s taking possession of the land,
by reason of serving such land from his other land; G
fourthly, the damage (if any) sustained by the person
interested, at the time of the Collector’s taking possession of
the land, by reason of the acquisition injuriously affecting
his other property, movable or immovable, in any other manner,
or his earnings; H
466 SUPREME COURT REPORTS [2023] 2 S.C.R.
A fifthly, in consequence of the acquisition of the land by the
Collector, the person interested is compelled to change his
residence or place of business, the reasonable expenses (if
any) incidental to such change, and
sixthly, the damage (if any) bona fide resulting from diminution
B of the profits of the land between the time of the publication
of the declaration under section 6 and the time of the
Collector’s taking possession of the land.”
54. A bare perusal of Section 23 would show that, the grounds for
classification as purported by the GNOIDA authority, have already been
C
covered by Section 23 of the Act. The fifth point of the said Section
squarely covers the requirement of compensating for rehabilitation of
the affected landowners. In the presence of an already existing provision
in the act, the classification created by the GNOIDA authority, must
exist in furtherance of the said Section, and not in contrast of.
D
55. The classification, as discussed above, if allowed to exist, can
lead to several Gair-pushtaini landowners who may also need to be
rehabilitated, cannot rehabilitate themselves without compensation for
the same. This circumstance alone besides being discriminatroy pits the
said classification against Section 23 of the Act, causing an insubordination
E to the 1894 Act. Such a mischief, if allowed to exist, would not only
nullify the purpose of the Act, but also violate the third and fourth principle
of the proportionality test, and hence is liable to be struck down.
56. Further, it is also important to note that the classification, even
if allowed to exist, does not come with any safeguards against its potential
F abuse. As mentioned above, the said notification by way of its
classification creates disastrous mischief, and the notification does nothing
to remedy such potential abuse. No guidelines for the said classification
exist, nor are there any bars placed. If such classification is left unchecked,
it may lead to bad precedence, and disastrous ramifications in the
G future.This lack of substantive guidelines also violates the fifth prong of
the proportionality test.
57. On the basis of the abovementioned discussions emerging
from the settled principles, Issue no. 2 is answered in affirmative and in
favour of the Appellants herein, and the impugned classification is liable
H to be struck down as violative of Article 14 of the Constitution of India.
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 467
PRADESH [KRISHNA MURARI, J.]
Whether the classification made by the Full-Bench of the High A
Court betweenPushtaini landowners and Gair-pushtaini landowners
is in contravention to thelaw laid down by this Hon’ble Court in the
case of Nagpur Improvement Trustand another vs. Vithal Rao and
others (1973) 1 SCC 500?
58. In the case of Nagpur Improvement Trust (Supra) this B
Hon’ble Court was tasked to deal with the question of whether certain
provisions the Nagpur Improvement Trust Act, 1936 were in violation of
Article 14. Here, the impugned provisions of the said Act allowed the
acquisition of lands at rates lower than the rates as prescribed in the
Land Acquisition Act. What is relevant to our case, is that the Court, C
while deciding this matter, held that the authority, while acquiring land,
cannot distinguish between types of owners, as the object of achieving
land for public purposes is met with, irrespective of the type of owner
whose land is being acquired. The relevant paragraphs from the judgment
reads as under:-
D
“It is now well-settled that the State can make a reasonable
classification for the purpose of legislation. It is equally well-
settled that the classification in order to be reasonable must
satisfy two tests: (i) the classification must be founded on
intelligible differentia and (ii) the differentia must have a
E
rational relation with the object sought to be achieved by the
legislation in question.
In this connection it must be borne in mind that the object
itself should be lawful. The object itself cannot be
discriminatory, for otherwise, for instance, if the object is to F
discriminate against one section of the minority the
discrimination cannot be justified on the ground that there is
a reasonable classification because it has rational relation
to the object sought to be achieved.
What can be reasonable classification for the purpose of G
determining compensation if the object of the legislation is to
compulsorily acquire land for public purposes?
It would not be disputed that different principles of
compensation cannot be formulated for lands acquired on
the basis that the owner is old or young, healthy or ill, tall or H
468 SUPREME COURT REPORTS [2023] 2 S.C.R.
A short, or whether the owner has inherited the property or
built it with his own efforts, or whether the owner is politician
or an advocate. Why is this sort of classification not
sustainable? Because the object being to compulsorily acquire
for a public purpose, the object is equally achieved whether
the land belongs to one type of owner or another type.”
B
59. In our opinion, a bare reading of the abovementioned judgment
makes it amply clear that the classification made by the GNOIDA
authority for the purposes of awarding differential compensation is bad
in law, and it is precisely this kind of classification that has been barred.
C When the purpose of the acquisition of the land is for the benefit of the
public at large, then the nature of the owner of the said land is
inconsequential to the purpose. If such a classification on the basis of
the nature of owner is allowed, then on the same grounds, there might
be a possibility of future classifications where powerholding members
of the society may get away with a larger compensation, and the
D marginalized may get lesser compensation. This is precisely what this
Court in the abovementioned judgment predicted,and to pre-empt such
arbitrary classification, clarified the position in law.
60. The Land Acquisition Act does not distinguish between classes
of owners, and uniformly provides compensation to all class of
E
landowners. The classification made between Pushtaini landowners and
Gair-pushtaini landowners, on the basis of the reasoning mentioned above,
is violative of the law laid down in the Nagpur Trust case (Supra) and
Article 14 of the Constitution.
F Conclusion
61. In light of the above-mentioned reasoning, we are of the opinion
that the classification made by both the executive actions is bad in law,
and is liable to be set aside. The Land Acquisition Act does not envisage
any differential compensation on the basis of such classification, and
G hence, this Court must infer the compensation to be provided by the
executive actions within the confines of Section 23 of the Act.
62. Section 23 of the Land Acquisition Act states out the grounds
for granting compensation in cases of acquisition of land under the Act.
One such reason for the grant of compensation is rehabilitation, and it is
H this need for granting compensation for rehabilitation under the Act that
RAMESH CHANDRA SHARMA v. STATE OF UTTAR 469
PRADESH [KRISHNA MURARI, J.]
is echoed by the impugned notification. A bare reading of both the A
executive actions in consonance with the Act would show that the need
for giving compensation for rehabilitation is valid in law and is backed by
the parent statute. The mischief then, is only limited to the arbitrary
classification made by such actions. In such a case, we are of the opinion
that since the mischief lies only within the classification, it can be severed,
B
and the remaining part of the executive actions that sets out to grant
compensation for the purpose of rehabilitation remains valid in law.
63. Once the classification is removed, and the executive actions
are read in consonance with the parent act, we would see that since the
Act, and now even the executive actions do not discriminate in terms of C
compensation, the ex-gratia payment and the increased base amount, as
enunciated by the executive actions, must be given to all landowners in
the subject area.
64. At this stage, we would like to state that while the objective of
the said classification might have been noble, however, such classification D
only on the basis of conjectures and surmises cannot be sustained. If a
claim is being made to differentiate between class of persons, such claim
must be backed by empirical data. While this Court is not a fact-finding
Court and is a Court of law, however, the law must also not be understood
in isolation, but in the context in which it exists, as the law does not exist
E
like an object within the statutes, but lives and evolves with the people it
governs.
65. Further, in cases of administrative action, even if the
classification has a rational nexus to the objective of the notification, the
classification must also be legitimized by the parent statute. If the parent F
statute does not allow for a classification, then, even if the classification
vis-à-vis the notification is able to pass the tests of Article 14, it would
still be liable to struck down if the parent statute does not allow for the
same.
66. The establishment of Greater Noida, as discussed above, G
was done for a noble purpose, i.e., to accommodate in the city all those
who came travelling from every corner of the country in search of a
better life. While doing so however, as can be seen in the present case,
some residents whose land was subject to acquisition in the pursuit of
the said aim, were faced with discrimination. In such circumstance, it
H
470 SUPREME COURT REPORTS [2023] 2 S.C.R.
A becomes the duty of this Court to dispense justice, and rectify the harm
caused to those at the receiving end of the discrimination.
67. In view of the above discussions, the impugned judgment passed
by the Full Bench of the High Court is not liable to be sustained and
stands set aside. As a consequence, the Writ Petition filed by the
B appellants before the High Court stands allowed and the appellants are
held entitled to the reliefs claimed in the said Writ Petition.
68. Accordingly, the appeals stand allowed.
69. In the facts and circumstances, we do not make any order as
C to costs.
Divya Pandey Appeals allowed.
(Assisted by : Rakhi, LCRA)
D
E
F
G
H
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