Holding

Under the Land Acquisition Act, 1894, the State may acquire a part of a building without acquiring the underlying land, as the definition of “land” is inclusive and s.49 expressly authorises such partial acquisition, which does not contravene Article 300A.

Summary

The State of Maharashtra sought to acquire portions of two high‑rise buildings – the third floor of Reliance Centre and the second floor of the Express Building – where the land beneath the structures was owned by the Government or a Port Trust, but the buildings were owned by private parties. The key issue was whether, under the Land Acquisition Act, 1894, a part of a building could be acquired without acquiring the underlying land. The Supreme Court held that the definition of “land” in s.3(a) is inclusive, covering benefits arising from land and things permanently attached to it, and that s.49 expressly permits acquisition of a part of a house or building when the owner has not insisted on acquiring the whole. Consequently, acquiring only the building portion does not violate Article 300A of the Constitution, and the State may compensate the private owners for the interest acquired. The appeal was allowed, setting aside the High Court’s decision.

Issues considered

Interpretation of the term “land” under s.3(a) of the Land Acquisition Act, 1894.
Whether the word “includes” in the definition expands the meaning of land to cover attached structures.
Whether the State must acquire its own land when acquiring a part of a building situated on that land.
Whether acquisition of a part of a building without the underlying land is permissible under s.49 of the Act.
Whether such acquisition infringes Article 300A of the Constitution.
Method of valuation of a part of a building when land and building are considered a single unit.

Legislation cited

Bombay Land Requisition Act, 1948s. 6(4)(a)
Land Acquisition Act, 1894s. 11, s. 23, s. 3(a), s. 4, s. 49, s. 6, s. 9

Subjects

Land acquisitionSection 49Definition of landEminent domainArticle 300ADual ownershipCompensationStatutory interpretation

Judgment

[2017] 10 S.C.R. 330

A STATE OF MAHARASHTRA & ORS.
v.
RELIANCE INDUSTRIES LTD. & ORS.
(Civil Appeal No. 1699 of2007)
B SEPTEMBER 15, 2017
[ARUN MISHRA AND
MOHAN M. SHANTANAGOUDAR, JJ.J
Land Acquisition Act, 1894:
C ss. 3(a) and 49 - Acquisition of part of building - Without
acquiring land underneath such building - When the ownership of
the land lies with the Government - Permissibility- Held: Definition
of 'land' under s. 3(a) is of wide connotation - The definition includes
benefits arising out of land and things .attached to the earth or
D permanently fastened to anything attached to the earth - Since the
owner of the building is different from the owner of the land, and if
portion of that building is required/or public purpose, it is open to
the State to acquire that portion of building u!s. 49 - Only the interest
belonging to the owner has to be acquired - Government itse(f being
the owner of the land, is not required to acquire the land - It was
E required only to acquire the private interest (in the building) - Such
acquisition would not amount to overreach of the State's power of
eminent domain or violation of Art. 300A of the Constitution -
Constitution of India - Art. 300A.
Interpretation of Statutes:
F Rules of interpretation - Interpretation must depend on the
text and context - A statute is best i11te17Jreted when one knows why
it was enacted - The Act must be looked at as a whole and
discovered, what each Section, each clause, each phrase and each
word was meant and designed to say as to fit into the Scheme of the
G entire Act - No part or word of statute can be construed in isolation.
Words and Phrases:
/iVord 'includes' - Meaning of; in the context of s. 3(a) of
Land Acquisition Act, 1894.

H
330
STATE OF MAHARASHTRA & ORS. v. RELIANCE 331
INDUSTRIES LTD. & ORS.

Allowing the appeal, the Court A
HELD: 1. The definition of land is of wide connotation. It
cannot be construed in narrow sense to render provisions. of the
Land Acquisition Act, 1894 otiose or impracticable. The definition
of "land" u/s. 3(a) of Land Acquisition Act is inclusive and it
includes benefits arising out of land, and things attached to the B
earth or permanently fastened to anything attached to the earth.
Provisions of Section 49 of the Act make it clear besides the
inclusive definition under Section 3(a), that there can be
acquisition of part of b.uilding or house and owner has the option
to express his desire that the whole of it should be acquired and
not the part, as the case may be. The court has the power to c
decide on a question being referred under the second proviso,
whether land proposed to be taken forms part of the house,
manufactory or building. The court has to take into consideration . ·
the question whether land proposed to be taken is reasonably
required for the full and unimpaired use of the house, manufactory D
or building. If the court holds otherwise, obviously the possession
of the land shall not be taken. There can be acl}uisition of the
house or building or manufactory under the provisions of Section
49(1) or acquisition of part. It is not a case where any of the owners
of the building has desired that whole 'or building be acquired. In
case such intention would have been expressed, it would have E
been incumbent to acquire the whole of the building. [Paras 12,
16 and 19] [342-F, G-H; 344-E-G; 349-B]
Municipal Corporation of Greater Bombay & Ors. v.
Indian Oil Corporation Ltd. (1991) Supp. 2 SCC 18:
[1990] 3 Suppl. SCR 365; P. Rami Reddy & Ors. v. F
State of Andhra Pradesh & Ors. (1988) 3 SCC 433:
[1988] 1 Suppl. SCR 443; Mrinalini Roy & Ors. v. State
of West Bengal & Ors. 1975 (1) CLJ 57 - relied on.
2.1 The definition of land in section 3(a) is inclusive. It has
to be seen in the context of each and every provision in the Act G
to find out as to the meaning to be given to the inclusive definition.
By the interpretation given to the word 'land', there is no
question of taking away very meaning of the land but the acquisition
of the right in the land can only be with respect to the right of the
H
332 SUPREME COURT REPORTS [2017] 10 S.C.R.

A owner. Obviously, only the interest belonging to the owner has
to be acquired and as per Section 49 of the Act, there can be
acquisition of the part of the house, building or manufactory. Once
option has not been exercised by the owner by insisting that whole
of the building be acquired, it would be only of the interest which
B is existing in the part of building, house or manufactory. [Paras
20, 25) [349-B-C; 354-E-G]
C.l.T. Andhra Pradesh v. Mis. Taj Mahal Hotel,
Secunderabad (1971) 3 SCC 550; S.K. Gupta & Ors.
v. K.P Jain & Anr. (1979) 3 SCC 54 : (1979] 2 SCR
1184; P Kasilingam & Ors. v. PS.G. College of
c Technology & Ors. (1995) Supp. 2 SCC 348 : [1995] 2
SCR 1061 - relied on.
Jagir Singh v. State of Bihar (1976) 2 SCC 942 : [1976]
2 SCR 809; Reserve Bank of India v. Peerless General
Finance & Tnvestment Co. Ltd. & Ors. (1987) 1 SCC
D 424 : [1987] 2 SCR 1 - held inapplicable.
2.2 Interpretation must depend upon the text and the
context. They are the basis of interpretation. If the text is the
texture, context is what gives the colour. Neither can be ignored.
Both arc important. That interpretation is best which makes the
E textual interpretation match the contextual. A statute is best
interpreted when one knows why it was enacted. If the statute is
looked at, in the context of its enactment, with the glasses of the
statute-maker, provided by such context, its scheme, the sections,
clauses, phrases and words may take colour and appear different
F than the statute is looked at without glasses provided by the
context. The Act must be looked at as a whole and should be
discovered what each section, each clause, each phrase and each
word is meant and designed to say as to fit into the scheme of the
entire Act. No part of a statute or word of a statute can be
construed in isolation. [Para 27] [355-B-D]
G
2.3 The Land Acquisition Act, 1894 was enacted since the
Act of 1870 was found entirely ineffective for the protection either
of the persons interested in lands taken up or of the public purse.
The object of the Land Acquisition Act, 1894 was to amend the
then existing law for acquisition of law for public purpose and to
H determine the adequate amount of compensation to be paid on
STATE OF MAHARASHTRA & ORS. v. RELIANCE 333
INDUSTRIES LTD. & ORS.

account of such acquisition. The word 'includes' has been A
interpreted by looking at the definition as a whole in the scheme
of the entire Land Acquisition Act and by reference to what
preceded the enactment and the reasons for it. (Paras 28, 29]
355-E-F]
2.4 The word 'include' is opposite to the word 'exclude'. If B
the interpretation as suggested by the respondents is accepted,
then the definition of the land could not become an inclusive
definition but the definition of "land" excludes certain factors.
The expression 'land' includes benefits arising out of the land
and things attached to the earth or permanently fastened to
anything attached to the earth. The portion of the building cannot C
survive independent of the building and the building without the
land. The word "land" should be understood having been covered
by the elongated definition since it defines with inclusiveness
that part of the building. (Para 29] [355-F-H]
2.5 In the present case, owner of the land is the State D
whereas the owner of the building is a respondent. Since, building
cannot stand without the land, the building also becomes part of
the land. However, since the owner of the building is different
from the owner of the land, and if a portion of the building is
required for public purpose, it is open for the State to acquire E
that portion of the building by paying adequate compensation in
respect of that portion of the building, as well as, in respect of
proportionate diminution of the user, if any of the land, under·
Section 23 of the Land Acquisition Act, 1894, in accordance with
law. (Para 30] (356-B-C]
F
3. The object of the Act is to compensate the owner
adequately. The purpose of the Act is to make additions for the
public purpose and to award to the owners/ interested persons
compensation in accordance with the provisions of the Act. The
acquisition has been made for the public purpose in the instant
case. When flats can be sold independently, obviously they can G
be acquired also. As all the rights in the floor are being acquired
and the land beneath it need not be acquired more so it belongs
to the Government, there can be valid acquisition of such floors
independently without land in such cases. [Para 33] [360-E-F;
361-A] H
334 SUPREME COURT REPORTS [2017] 10 S.C.R.

A Gimar Traders v. State of Maharashtra, 2011 (3) SCC
1 : [2011) 3 SCR 1; T. L. Prakash Ram Rao v. The
District Collector. Ananthapur & Ors. (1993) 2 AP LJ
421 (HC) - distinguished.
4.1 The instant matters arc of dual ownership. In both the
B cases owners of the building are not the owners of the land. The
land belongs to State of Maharashtra or Port Trust. In such a
situation where the Government is the owner of the site, obviously
Government could not have acquired the land and in the case of
its own ownership, there was no necessity for the acquisition of
C land. [Para 34] [361-C)
Hari Chand & Ors. v. Secretary of State AIR (1939)
PC 235 - relied on.
R. Umraomal & Ors. v. State of Tamil Nadu & Anr. AIR
1986 Mad. 63 - approved.
D 4.2 When the Government was having interest in the land
and acquires a land under the provisions of the Land Acquisition
Act, the Government acquires the sum total of private interests
subsisting in them. If the Government has itself an interest in
the land it is only to acquire other interest outstanding therein,
E the Government interest cannot be acquired under the Act though
an investigation can be made of such interest, bl!t that would not
make the subject of acquisition. [Para 41) [367-E-F]
Collector of Bombay v. Nusserwanji Rattanji Mistri and
Ors. AIR 1955 SC 298 : [1955] SCR 1311; Special
Land Acquisition Officer and Rehabilitation Officer,
F
Sagar v. M.S. Seshagiri Rao & Anr. AIR 1968 SC 1045
- relied on.
Secretaty of State v. Allahabad Bank Ltd. AIR 1939
All, 34; Raja Shyam Chunder Mardrai & Ors. v. The
Secretary of State for India in Council (1907-08) 12
G
CWN 569; Dasarath Sahu & Ors. v. Secy. of State AIR
1916 Pat. 330 (1); Makhan Lal & Ors. v. SeCJ'. of State
AIR 1934 All. 260 - overruled.
5. If the ownership of the land with owner of the building
and owner has required by expressing desire that the whole of
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 335
INDUSTRlES LTD. & ORS.

the building w'ith land be acquired. Only then Section 49 of the A
Act would not empower the acquisition of any building or part
thereof de hors the underlying land. The land upon which the
building is standing need not be acquired and there is no necessity
to acquire it. There can be acquisition of part of the building or
the house or manufactory as the owners have not exercised their B
option to insist for acquisition for whole of the building as such
only the rights which they have in the particular floors are being
acquired. Under proviso to Section 49(1) there can be acquisition
of land beside the part of the building, house or manufactory and
when the land is proposed to be taken, the dispute as to whether
it docs or does not form part of the house, manufactory or building, C
the Collector shall refer · the determination of such question to
the Court. Where part of building that too a multi-storied building
is being acquired, the land need not be acquired more so when
· the owner of building is not the owner of land and his entire
interest in part of building can be acquired. [Paras 44, 49] [373- D
A-D; 382-G)
State of Bihar & Am: v. Kundan Singh & Anr. AIR 1964
SC 350 : (1964) SCR 382; S.P. Jain v. Krishna Mohan
Gupta & Ors. (1987) 1 SCC 191 : [1987] 1 SCR 411-
relicd on.
E
Jagannath Ganeshram Agrawal & Anr. v. State of
Maharashtra & Anr. AIR 1986 Born. 241 - approved.
Saramma Itticheriya v. State of Kera/a & Ors. AIR 2008
Ker 72 - distinguished.
Harsook Das Bal Kishan Das v First Land Acquisition
Collector (1975) 2 SCC 256 : (1975] Suppl. SCR 79 - . F
referred to.
6.1 Article 300A of the Constitution of India interdict taking
of the property for a public purpose without. compensating the
owner for its loss. In case entire ownership of the land does not
lie with the owner, only the right which is capable of being acquired G ·
would be acquired not something Which is non-existent. The
building or part can be acquired and there. is no question of
acquisition of the land in such cases. In adjudication of the
compensation as per the provisions of Section 23, the State is
not depriving the respondents of their property. There is H
336 SUPREME COURT REPORTS [2017] 10 S.C.R.

A acquisition of land by fair procedure along with reasonable
compensation. The action has been taken by the State in
accordance with law. The action is legally justified. Thus, there
1s no question of eminent domain being misused or violation of
provisions of Article 300A. [Para 521 (383-F-Hf
B 6.2 It is also not correct to say that owner of the land is
deprived of his ownership rights over the land when the State
purports to acquire only a building or portion thereof standing on
his land, without acquiring the underlying land. The respondents
arc not the owner of the underlying land. Secondly, the acquisition
of a particular floor as per the provision of section 49 of the Act is
c permissible and the entire interest of owner in a particular portion
has been acquired for that he would be compensated. It is not
the case of partial acquisition of the interest on a particular tloor.
When without selling the land, in a building, a particular floor can
be sold why there could not be acquisition of particular floor for
D public purpose. [Para 53] [384-A-C]
6.3 The owner has the right to use and enjoy a particular
portion but owner cannot set up a plea for acquisition of an interest
when he does not have that particular right or interest or title.
His right to manage it, right to decide, how it shall be used, right
E to income from it has to be in accordance with the law. Right of
individual has to give way to the public purpose on being duly
compensated by way of fair procedure. [Para 54] [384-H; 385-A]
7. The entire interest of the owner has to be acquired and
that has been precisely done in the instant case. When land and
F building once married becomes one unit, neither land nor building
can thereafter be valued separately. But this would not come in
the way of determining the valuation of a particular floor, all the
aspects of the owners interest and the bundle of other rights can
be taken into consideration including support provided by the
land and value of the land in the locality etc. Value of the part of
G the building can also be accordingly assessed. [Paras 57, 58] [386-
F-G; 388-H; 389-A-B]
State of Kera/av. PP. Hassan Kaya AIR 1968 SC 1201 :
(1968] SCR 459 - relied on.

H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 337
INDUSTRIES LTD. & ORS.

State of Bihar v. Kameshwar Prasad 1952 SCR 889; A
Trisha/a Jain & A11r. v. State of Uttaranchal & Anr.
[2011) 8 SCR 520; Kiran Tandon v. Allahabad
Development Authority (2004) 10 SCC 74- referred to.
Salmond on Jurisprudence, (12"' ed.1966) at pp. 246-
247, 413 - referred to. B
Case Law Reference
(1990) 3 Suppl. SCR 365 relied on Para 17
[1988] 1 Suppl. SCR 443 relied on Para 18
1975 (1) CLJ 57 relied on Para 19
c
(1971) 3 sec 550 relied on Para 20
[1979] 2 SCR 1184 relied on Para 21
[1995] 2 SCR 1061 relied on Para 22
(1976) 2 SCR 809 held inapplicable Para 23
[1987] 2 SCR 1 held inapplicable Para 23 D
[2011) 3 SCR 1 distinguished Para 31
(1993) 2 AP LJ 421 (HC) distinguished Para 32
AIR (1939) PC 235 relied on Para 34
AIR 1986 Mad. 63 . approved Para 35
E
AIR 1939 All. 34 overruled Para 36
(1907-08) 12 CWN 569 overruled Para 37
AIR 1916 Pat. 330 (1) overruled Para 38
AIR 1934 All. 260 overruled Para 39
[1955] SCR 1311 relied on Para 41 F
AIR 1968 SC 1045 relied on Para 42
[1964] SCR 382 relied on Para 45
AIR 1986 Born. 241 approved Para 46
[1987) 1 SCR 411 relied on Para 46
G
[19751 Suppl. SCR 79 referred to Para 47
AIR 2008 Ker 72 distinguished Para 47
[1952] SCR 889 referred to Para 50
[2011] 8 SCR 520 referred to Para 51
H
338 SUPREME COURT REPORTS [2017] IO S.C.R.

A [1968) SCR 459 relied on Para 57
(2004) 10 sec 74 referred to Para 58
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1699
of 2007
B From the Judgment and Order dated 10.03.2006 of the High Court
of Judicature at Bombay in Writ Petition Nos. 1956 of 1994 and W. P.
No.1384ofl997.
Dr. Kylasanatha Pillai, Nishant Ramakantrao Katneshwarkar,
Ms. DeepaKulkarni, Arpit Rai, Ad vs. for the Appellants.
c Basava Prabhu S. Patil, K. V. Vishwanathan, Sr. Advs., Kumar
Anurag Singh, Hasan Mw·taza, Alok Kumar, Kumar Shivam, Rajesh
Kumar, Ms. Amrita Sarkar, Ms. Nidhi Agrawal, Ashok Mathur, Advs.
for the Respondents.
The Judgment of the Court was delivered by
D ARUN MISHRA, J. I. The State of Maharashtra has come up
in appeal against the common judgment dated I 0.3.2006 passed by the
High Court in two writ petitions being W.P. No.1956/1994 filed by
Reliance Industries Ltd. & another and W.P. No.1384/1997 filed by
Express Newspapers and another against State of Maharashtra and
E others. In both the cases, part of the building had been sought to be
acquired under the provisions of the Land Acquisition Act, 1894
(hereinafter referred to as "the Act"). In both the cases the owners of
building do not own the land. In Express Newspapers the land belongs
to the Government and in the case of Reliance Industries, the ownership
of the land is with the Port Trust. The question which arises for
F consideration is whether, under the Act, acquisition of part of the building
can be made without acquiring land underneath to such building. The
High Court has quashed the acquisition, sans the land, as unsustainable.
2. In W.P. No.1956of1994, the premises admeasuring 1478 sq.
mts. on the third floor of the building i.e. "Reliance Centre" at 19,
G Walchand Hirachand Marg, Ballard Estate, Bombay is the premises.
The Controller of Accommodation had requisitioned the said
accommodation under the provisions of section 6(4)(a) of the Bombay
Land Requisition Act, 1948 (hereinafter referred to as "the Requisition
Act"). It had been allotted for use and occupation by Anti Corruption
H Bureau, Prohibition and Intelligence Bureau of the Government of
STATE OF MAHARASHTRA & ORS. v. RELIANCE 339
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

Maharashtra and was also partly occupied by Deputy Controller of A
Rationing, Region-A, Department of Civil Supplies.
3. W.P. No.1679 of 1991 was filed by Reliance Industries Ltd.
challenging the requisition order dated 23.1.1970 in view of the judgment
of this Court, disapproving withholding of requisitioned property for an
unreasonable period of time. B
4. The State Government issued a notification under section 4 of
the Act to acquire the entire third floor premises admeasuring 167 .SO sq.
mtrs. in the building. Notice was issued for the purpose of an inquiry
under section SA on 28.12.1992 that was served on 02.01.1993. ln pending
writ petition an amendment application was filed to incorporate the c
challenge to the land acquisition proceedings. However, on objections
being filed, the writ petition was disposed of with liberty to challenge the
acquisition proceedings independently. Declaration under section 6 was
issued on 23.6.1994. Notice under section 9 of the Act was issued on
29.7.1994 which was served on 2.8.1994. Thereafter, Reliance Industries
Ltd. filed fresh writ application out of which the present appeal arises. D
5. In W.P. No.1384 of 1997, the respondent - Express
Newspapers - is the lessee of the land owned by the Government. The
building is known as "Express Building" at Plot No.18, Block No.I; Back
Bay Reclamation, Bombay. The Governor of Bombay had granted the
registered lease on 13.3.1956. The second floor comprised in 4500 sq.ft. - E
was sought to be acquired.
6. Earlier vide order dated 25.9.1968 the said floor of Express
Newspapers building was requisitioned for use of State Government
and was allotted to the 5t11 appellant, i.e., Controller of Rationing, Food &
Civil Supplies Department. Since the requisitioning continued for an unduly F
long period, Express Newspapers Ltd. filed W.P. No.226911992. During
the pendency of the same, the State Government initiated the acquisition
proceedings by issuing a notification under section 4 with respect to the
second-floor premises admeasuring about 325.15 sq.mtrs. needed for
Food & Civil Supplies Department to accommodate the office of the G
ControllerofRationing, Food & Civil Supplies. Notice under section 9 of
the Act was issued. Thereafter, declaration issued under section 6 of the
Act was withdrawn. Subsequently, a fresh notification under section 4
was issued on 28. 7. 1996 in relation to the vacant premises of second
floor admeasuring 345.18 sq.mtrs. Objections were filed, an inquiry under
H
340 SUPREME COURT REPORTS [2017] 10 S.C.R.

A section SA of the Act was held, followed by a declaration under section
6 which came to be issued on 17.4.1997 and notice under section 9 on
23 .7 .1997. Thereupon, writ petition had been preferred out of which the
appeal arises.
7. The High Court has held that without acquisition of land, part
B of the building could not be acquired. The definition of'building' in section
3(a) of the Act is an inclusive one. The land would include all benefits
arising out ofland for the purpose of acquisition as well as things attached
to the earth or permanently fastened to anything attached to the earth.
In other words, the High Court has held all the structures or the trees or
any material attached or fastened to the land to be acquired, would also
C be the subject matter of acquisition along with such land. But under the
provisions of the Act without the land to which the things are attached or
permanently fastened, such things by themselves and singularly cannot
be the subject matter of acquisition. Though the term 'include' would
suggest the definition of "Land" to be exhaustive and extensive, an
D interpretation of the term has to be in the context of and cannot be in
isolation. The acquisition under the Act cannot be merely of the benefits
out of or the things attached or permanently fastened to the land without
acquiring the land itself. The High Court has further held that a part of
the house or building which can be acquired in the absence of objection
in that regard by the owner, would necessarily include the land underneath
E or appurtenant to such part of the house or building. Merely because
there is dual ownership, it would not mean that acquisition proceedings
under the said Act could be oflimited interest in the land.
8. Against the judgment and order passed by the High Court, the
appeals have been preferred by the State of Maharashtra, this Court
F has directed maintenance of status quo. Application for subsequent
events has also been filed indicating that efforts have been made to get
the pre·mises vacated and to withdraw the acquisition proceedings.
However, acquisition has not been withdrawn so far. In our opinion, it is
of no consequence, as acquisition cannot be withdrawn.
G 9. Learned counsel appearing for the appellants has submitted
that under the Act a part of the building can be acquired without acquiring
the land on which the building has been built. The true pwport and meaning
of the expression 'land' has not been correctly appreciated by the High
Court. It was submitted that part of the building without the land on
H which the building is built, is covered by the expression 'land' as defined
STATE OF MAHARASHTRA & ORS. v. RELIANCE 341
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

under the Act. Learned counsel has further submitted that the definition A
is inclusive definition. It has not been correctly interpreted by the High
Court. Same is of wide amplitude. When the Government or the Port
Trust owns the land and only a part of the building was required, its
acquisition could have been made without acquisition of the land. It was
not necessary for the Government to acquire its own land. Section 49 of B
the Act contemplates the acquisition of not only of a house or building
but also a part of house or building. The concept of dual ownership is
well settled. There is no reason why building itself or part thereof
belonging to an independent owner cannot be acquired. There arc very
many things that can be acquired under the Act without acquiring the
land such as fisheries etc. Government has to acquire what it is capable c
of acquiring and not something more that was required to be acquired.
Under section 16 of the Act, property acquired vests with the Government
free from all encumbrances. The term 'encumbrance' means a claim,
lien or liability attached to the property. The persons who are holders of
such encumbrance arc entitled to compensation.
D
10. It was submitted on behalf of the respondents that definition
of the 'Land' under section 3(a) of the Act, is inclusive but it does not
define the land to mean "benefits to arise out ofland, and things attached
to the earth or permanently fastened to anything attached to the earth".
It was vehemently urged that the inclusive definition couldn '!'take away
the ordinary meaning of 'land'. The definition only provides for what it E
additionally includes. It was further submitted that the object of the Land
Acquisition Act provides the context in which expression 'land' is to be
interpreted. The Act contemplates the acquisition of the land in the
ordinary sense of the term and a mere building without the underlying
land cannot be acquired under the Act. It was· further submitted that F
section 49 of the Act does not empower the acquisition of any building
or a part thereof de hors the underlying land. For that reliance has been
placed upon the second proviso to section 49(1). It was also urged by
learned senior counsel appearing for the respondents that acquisition of
a building or a part thereof without acquiring the underlying land would
be an overreach of State's power of eminent domain. The State has an G
obligation to compensate the owner for his land. This restriction on State's
power is inherent in the doctrine of eminent domain. It was also contended
that owner of the land is deprived of his ownership rights over his land
when the State purports to acquire only a building or part thereof, standing
on his land without acquiring the underlying land. The owner has the H
342 SUPREME COURT REPORTS [2017] I 0 S.C.R.

A right to possess the thing which he owns. He also has a right to use or
enjoy the thing owned. Other's right of ownership also coincides if the
building is compulsorily acquired. No person would want to buy the
underlying land from the owner. Thus, the owner of the land would be
deprived of his right to obtain a fair income or value of the land upon
B alienations. Thus, upon acquisition of a building, State also deprives the
landowner of the right in his land. By not acquiring the land the State
would be avoiding its obligation to compensate the owner for its land.
... Interpretation of section 3(a) of the Act has to be consistent with the
·· 'limitation on the State's power of eminent domain interpreted in Article
300A of the Constitution oflndia.
c 11. Following questions arise for our consideration:
I. Meaning of land under section 3(a) of the Act.
II. Interpretation of term 'includes'.
III. Object and scheme of Act.
D
IV. Whether State to acquire its own land underneath
building or other interest?
V. Acquisition of part of building without land under section
49 of the Act.
E VI. Violation ofArticle 300A by acquisition in part.
VII. Whether valuation method of building mandates acquiring
ofland?
!: In Re : Meaning of land under section 3(a) of the Act
F 12. It is necessary to consider definition of'land'. Section 3(a) of
the Act defines the expression 'land' which is extracted hereunder:
"3. Definitions. - In this Act, unless there is something repugnant
in the subject or context, -
(a) the expression "land" includes benefits to arise out ofland,
G and things attached to the earth or permanently fastened to
anything attached to the earth"
The definition of"land" is inclusive and it includes benefits arising
out of land, and things attached to the earth or permanently fastened to
anything attached to the earth.
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 343
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

13. When we consider the scheme of the Act, section 4 provides A
that no person shall enter into any building or upon any enc.dosed court or
garden attached to a dwelling house without giving notice in writing for
the purpose of preliminary investigation when the land is required for
public purpose.
14. Section 49 of the Act deals with the acquisition of part of B
house or building. The provision is extracted hereunder:
"49. Acquisition of part of house' or building. - (1) The
provisions of this Act shall not be put in force for the purpose of
acquiring a part only of any house, manufactory or other building,
if the owner desires that the whole of such house, manufactory c
or building shall be so acquired:
Provided also that, if any question shall arise as to whether any
land proposed to be taken under this Act does or does not form
part of a house, manufactory or building within the meaning of
this section, the Collector shall refer the determination of such D
question to the Court and shall not be take posses~ion of such
. land until after the question has been determined.
In deciding on such a reference the Court shall have regard to
the question whether the land proposed to be taken, is reasonably
require for the full and unimpaired use of the house, manufactory E
or building.
(2) If, in the case of any claim under section 23, sub-section (1 ),
thirdly, by a person interested, on account of the severing of the
land to be acquired from his other land, the [appropriate
Government] is of opinion that the claim is unreasonable or
F
excessive, it may, at any time before the Collector has made his
award, order the acquisition of the whole of the land of which
.the land first sought to be acquired forms a part.
(3) In the case lasthereinbefore provided for, no fresh declaration
or other proceedings under sections 6 to I0, both inclusive, shall G
be necessary; but the Collector shall without delay furnish a copy
of the order of the [appropriate Government] to the person
interested, and shall thereafter proceed to make his award under
section 11." ,

H
344 SUPREME COURT REPORTS [2017] IO S.C.R.

A 15. The provision contained in section 49 makes it clear that there
can be acquisition of part of house or building but if the owner thereof
desires that whole of his house or manufact01y or building shall be so
acquired, the provisions can not be used for the purpose of acquiring a
part only of any house, manufactory or other building and when a part is
proposed to be acquired, owner has right to object that the whole building
B
or house should be acquired and not the part, and the owner at any time
before the Collector has made his award under section 11, by notice in
writing, withdraw or modify, his expressed desire that the whole of such
house, manufactory or building shall b'e so acquired. Second proviso
makes it clear that if any question arises whether any land proposed to
C be taken under the Act does or does not form part ofa house, manufactory
or building within the meaning of section 49(1 ), the Collector shall refer
the determination of such question to the court and shall not take
possession of it until after the question has been determined, and the
court while deciding such a question whether the land proposed to be
D taken is reasonably required for the full and unimpaired use of the house,
manufact01y or building.
16. In our opinion, provisions of section 49 of the Act make it
clear besides the inclusive definition under section 3(a), that there can
be acquisition of part of building or house and owner has the option to
express his desire that the whole of it should be acquired and not the
E
part, as the case may be. The court has the power to decide on a
question being referred under the second proviso, whether land proposed
to be taken forms part of the house, manufactory or building. The court
has to take into consideration the question whether land proposed to be
taken is reasonably required for the full and unimpaired use of the house,
F manufactory or building. If the court holds otherwise, obviously the
possession of the land shall not be taken. There can be acquisition of the
house or building or manufactory under the provisions of section 49( I)
or acquisition of part. It is not a case where any of the owners of the
building has desired that whole of building be acquired. In case such
intention would have been expressed, it would have been incumbent to
G acquire the whole of the building.
17. In Municipal Corporation of Greater Bombay & Ors. v.
Indian Oil Corporation Ltd. (1991) Supp. 2 SCC 18 this court had
considered the definition of"land'' which is an inclusive definition and
has observed that its accompaniments are land which is being built upon
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE / 345
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]
I

or is built upon or covered with water; benefits to arise out of land; A
things attached to the earth, This Comi has held thus:
"26 The question then is whether it is a land? Indisputably the
definition of 'land' also is of an inclusive definition. Its
accompaniments arc land which is being built upon or is built
upon or covered with water; benefits to arise out ofland: things B
attached to the eaiih or pem1anently fastened to anything attached
to the earth and rights created by legislative enactment over any
street. The question is whether the tank is attached to the ea1ih?
In Stroud's Judicial Dictionary (5th edn. Vol. 1) relied on by the
learned counsel for the appellant, the word 'attached' has been
defined at page 217 thus: C
"This word docs not always mean physically fastened; it may
also mean, superineumbent upon. Thus, in citing the judgment
of Cockburn, C.J., Laing v. Bishopswearmouth, that whatever
is 'attached' to premises has to be estimated for the purpose
of ascertaining its rating value." D
18. The meaning of"land" has also been considered by this Court
in P Rami Reddy & Ors. v. State of'Andhra Pradesh & Ors. ( 1988) 3
SCC 433. This Court has discussed the question that arose in the context
of the meaning of the expression 'land' in paragraph 5(2)(a) of the Fifth
Schedule to the Constitution and section 3( 1) of the Schedule to A.P. E
Scheduled Area Land Transfer Regulation, 1959. This Comi has laid
down thus:
"21 Another argument which did not succeed in the High Court
has been hopefully persisted with in this Court. The expression
"Land" has been used in its restricted sense in para 5(2)(a) of F
the Fifth Schedule and therefore the impugned provisions
prohibiting the transfer oflands along with structures thereon by
employing the expression "immovable property" is not in
accordance with law. Such is the argument. This argument is
devoid of merit for two reasons: Firstly, there is no reason to G
believe that "land" has not been employed in its legal sense. The
expression "land" in its legal sense is a comprehensive expression
which is wide enough to include structures,-if any, raised thereon.
While this proposition hardly needs to be buttressed, support can
be sought from the following sources:
H
346 SUPREME COURT REPORTS [2017] !OS.C.R.

A The Dictionary of English Law [ 1959 edn., Vol. 2, p.l 053 by
Earl Jowitt]
LAND, in its restrained sense, means soil, but in its legal
acceptation it is a generic term, comprehending every species of
ground, soil or earth, whatsoever, as meadows, pastures, woods,
B moors, waters, marshes, furze, and heath; it includes also houses,
mills, castles, and other buildings; for with the conveyance of the
land, the structures upon it pass also. And besides an indefinite
extent upwards, it extends downwards to the globe's centre, hence
the maxim, Cujus est so/um ejus est usque ad cae!um et ad
inf'eros; or, more curtly expressed, Cujus est so/um ejus est
c a/tum (Co. Litt. 4-a).
Words and Phrases Judicially Defined (By Roland Burrows- Vol.
III, 1944 edn., p.206)
The word "land" would be variously understood by different
D persons. To a farmer the word "land" would not mean his farm
buildings; to a lawyer the word would include everything that
was upon the land fixed immovable upon it. Smith v. Richmond
per Lord Halsbury, L.C., at p. 448.
The Law Lexicon
E The word "land" is a comprehensive term, including standing
trees, buildings, fences, stones, and waters, as well as the earth
we stand on. Standing trees must be regarded as part and parcel
of the land in which they are rooted and from which they draw
their support.
F 22. Secondly, to interpret the expression "land" in its narrow
sense is to render the benevolent provisions impotent and
ineffective. In that event the prohibition can be easily
circumvented by just raising a farmhouse or a structure on the
land. The impugned provisions were inserted by the Amending
Regulation precisely to plug such loopholes and make the law
G
really effective. The High Court was perfectly justified in repelling
this meritless plea. It is therefore not possible to accede to this
submission."
(Emphasis supplied)
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 347
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

19. A Division Bench of the High Comi of Calcutta considered in A
Mrina/ini Roy & Ors. v. State of West Bengal & Ors. 1975 (1) CLJ 57
question whether the acquisition of fishery for the purpose ofreclamation
of Southern Salt Lake area was valid or not. It upheld acquisition. The
Court held that fishery is included in the definition of the land. Aforesaid
matter travelled to this Court in Mrinalini Roy Ratna Prova Monda! B
& Ors. v. State of West Bengal & Ors. (1997) 9 SCC 113, this court
considered the expression 'land' under the Act thus;
"2. It is not necessary to narrate all the facts in these cases.
Sut1ice it to state that notification under Section 4(1) of the Land
Acquisition Act; 1894 (for short "the Act") was published on 14-
5-1956 for reclamation of the fisheries in the lands comprising C
caqastral plots enumerated in the notification, of an extent
admeasuring more or less 8760.53 acres. Declaration under
Section 6 was published on 5-1-1971 declaring that the land for
the reclamation of the Southern Salt Lake area was published.
We arc concerned presently to an extent of 1495.93 acres only. D
It was contended in the High Court and also repeated by Dr S.
Ghosh, learned Senior Counsel, that the "land", as defined under
Section 3(a) does not include fisheries; that is made explicit by
the West Bengal Amendment Act, 1981 bringing fishery within
the ambit of the word "land" .~t would indicate thatthe authorities
have llllderstood that the Act does not apply to acquisition of the E
fisheries rights and, therefore, the acquisition was without
authority of law. In support thereof, Dr Ghosh placed reliance
on the judgment of the Division Bench of the Calcutta High Court
in Pasupati Roy v: State of WB. [AIR 1974 Cal 99] and State
of WB. v. Suburban Agriculture Dairy & Fisheries (P) Ltd. F
[1993 Supp (4) SCC 674] (SCC paras 6, 13, 14 and 16) and in
State of WB. v. Shebaits of lswar Sri Saradia Thakurani
[AIR 197 l SC 2097] (AIR at p. 2098, para 3). We find it difficult
to give acceptance to the contentions of the learned counsel.
The expression "land" includes benefits to arise out of land and,
things attached to the earth or permanently fastened to anything G
attached to the earth. Tank fisheries cannot survive independent
of the tank and there cannot be a tank without the land. Therefore,
the expression "land" is required to be understood in that
perspective when the tank fisheries are sought to be acquired.
H
348 SUPREME COURT REPORTS [2017] IOS.C.R.

A Tank fisheries thereby would be a benefit to arise out of the
land. Thereby the word "land" should be understood to have
been covered by the elongated definition since it defines with
inclusiveness that the tank fisheries is a benefit to arise out of
land.
B 4. It is true that a memo was filed on behalf of the Fisheries
Department and it was reiterated in the counter-affidavit filed in
the High Court that the land acquired would be used to rehabilitate
some of the displaced fishermen to eke out the livelihood in
reclamation tank fisheries. The above statement is not
inconsistent with the public purpose which became conclusive
c under Section 6(3 ). As seen, while reclaiming the tank fisheries
for the public purpose, some of the displaced fishermen on the
other lakes are sought to be rehabilitated in the Jake in question
by enabling them to catch the fish to earn livelihood. It would,
therefore, be not inconsistent with the declaration conclusiveness
D of which has been attached by operation of sub-section (3) of
Section 6 which is also consistent with Section l l 4(h) of the
Evidence Act, 1872. It is true that prior to the Amendment Act,
1981 tank fisheries were not expressly brought within the definition
of land. In 1981, with a view to avoid any further litigation on the
interpretation in that behalf, the legislature expressly brought
E within the ambit of the land tank fisheries or fisheries. That docs
not mean that it would not be capable of interpretation to bring
within the ambit ofa benefit to arise out of the land. The Division
Bench judgments of the Calcutta High Court relied upon by Dr
Ghosh have not correctly laid down the law. In Suburban
F Agriculture Dairy (supra) and Saradia Thakurani (supra)
cases that question did not squarely arise. That was a case under
the West Bengal Estates Acquisition Act, 1954 ( l of 1954). The
definition of "land" expressly mentions that the tank fisheries
are included within the definition of "estate" but vis-a-vis the
rights attached therein, option has been given to the intermediary
G within a specified time for its retention. Therefore, the
intermediary, if he had exercised the option after the notification
abolishing the estates concerned within the specified time, then
the tank fisheries stand excluded from vesting. That principle
has no application to the facts in this case. Accordingly, we hold
H that the tank fisheries are the land and the acquisition was for a
STATE OF MAHARASHTRA & ORS. v. RELIANCE 349
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

public purpose. We do not find any illegality warranting A
interference with the Division Bench judgment."
(Emphasis supplied)
The definition ofland is of wide connotation. It cannot be construed
in narrow sense to render provisions of the Act otiose or impracticable.
B
II. In Re : Interpretation of term 'includes'
20. The definitionofland in section 3(a) is inclusive. What meaning
is to be given to term 'include' for that reliance has been placed on
C.I.T, Andhra Pradesh v. Mis. Taj Mahal Hotel, Secunderabad
(1971) 3 SCC 550. The purport of interpretation of the expression C
"includes" has to be in the context of the Act. This Court has held thus:
"6. Now it is well settled that where the definition of a word has
not been given, it must be construed in its popular sense if it is a
word of every day use. Popular sense means "that sense which
people conversant with the subject-matter with which the statute D
is dealing, would attribute to it". In the present case, Section
I0(5) enlarges the definition of the word "plant" by including in it
the words which have already been mentioned before. The very ·
fact that even books have been included shows that the meaning
intended to be given to "plant" is wide. The word "includes" is
often used in interpretation clauses in order to enlarge the meaning E
of the words or phrases occurring in the body of the statute.
When it is so used, those words and phrases must be construed
as comprehending not only such things as they signify according
to their nature and import but also those things which the
interpretation clause declares that they shall include. The word F
"include" is also suspectible of other constructions which it is
unnecessary to go into."
21. The purport of inclusive definition has also been considered
by this Court in S.K. Gupta & Am: v. K.P. Jain & Anr. (1979) 3 SCC
54, thus;
G
. "24. The noticeable feature of this definition is that it is an inclusive
definition and, where in a definition clause, the word "include" is
used, it is so done in order to enlarge the meaning of the words
or phi·ases occurring in the body of the statute and when it is so
used, these words or phrases must be construed as
H
350 SUPREME COURT REPORTS [2017] 10 S.C.R.

A comprehending not only such things which they signify according
to their natural import, but also those things which the
interpretation clause declares that they shall include (see Dilworth
ic Commissioner ofStamps (1899)AC 99). Where in a definition
section of a statute a word is defined to mean a certain thing,
wherever that word is used in that statute, it shall mean what is
B
stated in the definitions unless the context otherwise requires.
But where the definition is an inclusive definition, the word not
only bears its ordinary, popular and natural sense whenever that
would be applicable but it also bears its extended statutory
meaning. At any rate, such expansive definition should be so
c construed as not cutting down the enacting provisions of an Act
unless the phrase is absolutely clear in having opposite effect
(see Jobbins E Middlesex County Council, (1948) 2 All ER
610). Where the definition of an expression in a definition clause
is preceded by the words "unless the context otheiwise requires",
normally the definition given in the section should be applied and
D
given effect to but this normal rule may, however, be departed
from ifthere be something in the context to show that the definition
should not be applied (see Khanna, J., in Indira Nehru Gandhi
v. Rqj Narain, (1975) Supp SCC 1). It would thus appear that
ordinarily one has to adhere to the definition and if it is an
E expansive definition the same should be adhered to. The frame
of any definition more often than not .is capable of being made
flexible but the precision and certainty in law requires that it
should not be made loose and kept tight as far as possible (see
Ka/ya Singh v. Genda Lal, (1976) 1 SCC 304)."
F 22. This Court has considered the purport of inclusive definition
in P. Kasilingam & Ors. v. P.S.G College of Technology & Ors.
( 1995) Supp. 2 SCC 348 thus;
"19. We will first deal with the contention urged by Shri Rao
based on the provisions of the Act and the Rules. It is no doubt
G true that in view of clause (3) of Section 1 the Act applies to all
private colleges. The expression 'college' is, however, not defined
in the Act. The expression "private college" is defined in clause
(8) of Section 2 which can, in the absence of any indication of a
contrary intention, cover all colleges including professional and
technical colleges. An indication about such an intention is,
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 351
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

however, given in the Rules wherein the e;x:pression, 'college' A
has been defined in Rule 2(b) to mean and include Arts and
Science College, Teachers'Training College, Physical Education
College, Oriental College, School oflnstitute of Social Work and
Music College. While enumerating the various types of colleges
in Rule 2(b) the rule-making authority has deliberately refrained
B
from including professionaland technical colleges in the said
definition. It has been urged that in Rule 2(b) the expression
"means and includes" has been used which indicates that the
definition is inclusive in nature and also covers categories which
are not expressly mentioned therein. We are unable to agree. A
particular expression is often defined by the Legislature by using C
the word 'means' or the word 'includes'. Sometimes the words
'means and includes' are used. The use of the word 'means'
indicates that "definition is a hard-and-fast definition, and no other
meaning can be assigned to the expression that is put down in
definition". (See: Gough v. Gough, (1891) 2 QB665; Punjab D
Land Development and Reclamation Corpn. Ltd. v. Presiding
Officer, Labour Court [1990 (3) SCC 682, at p. 717]. The word
'includes' when used, enlarges the meaning of the expression
defined s-o as to comprehend not only such things as they signify -
according to their natural import but also those things which the
clause declares that they shall include. The words "means and E
_includes", on the other hand, indicate "an exhaustive explanation
of the meaning which, for the purposes of the Act, must invariably
be attached to these words or expressions". (See : Dilworth v.
Commissioner of Stamps ( 1899 AC 99 at pp. I 05-106) (Lord
Watson); Mahalakshmi Oil Mills v. State ofA.P. ( 1989 1 SCC
F
164, at p. 169). The use of the words "means and includes" in
Rule 2(b) would, therefore, suggest that the definition of'college'
is intended to be exhaustive and not extensive and would cover
only the educational institutions falling in the categories specified
in Rule 2(b) and other educational institutions are not
comprehended. Insofar as engineering colleges are concerned, G
their exclusion may be for the reason that the opening and running
of the private engineering colleges are controlled through the
Board ofTechnical Education and Training·and the Director of
Technical Education in accordance with the directions issued by
the AICTE from time to time. As noticed earlier the Grants-in-
H
352 SUPREME COURT REPORTS [2017] JO S.C.R.

A Aid Code contains provisions which, in many respects, cover
the same field as is covered by the Act and the Rules. The Director
of Technical Education has been entrusted with the functions of
proper implementation of those provisions. There is nothing to
show that the said arrangement was not working satisfactorily
so as to be replaced by the system sought to be introduced by
B
the Act and the Rules. Rule 2(d), on the other hand, gives an
indication that there was no intention to disturb the existing
arrangement regarding private engineering colleges because in
that rule the expression 'Director' is defined to mean the Director
of Collegiate Education. The Director of Technical Education is
c not included in the said definition indicating that the institutions
which are under the control of Directorate of College Education
only are to be covered by the Act and the Rules and technical
educational institutions in the State of Tamil Nadu which are
controlled by the Director of Technical Education are not so
covered.
D
20. The Rules have been made in exercise of the power conferred
by Section 53 of the Act. Under Section 54(2) of the Act every
rule made under the Act is required to be placed on the table of
both Houses of the Legislature as soon as possible after it is
made. It is accepted principle of statutory construction that "rules
E made under a statute arc a legitimate aid to construction of the
statute as contemporanea expositio" (See : Craies on Statute
Law, 7th Edn., pp. 157-158; Tata Engineering and Locomotive
Co. Ltd. v. Gram Panchayat, Pimpri Waghere 1977 (1) SCR
306, at p. 317). Rule 2(b) and Rule 2(d) defining the expression
F 'College' and 'Director' can, therefore, be taken into consideration
as Contemporanea Expositio for construing the expression
"private college" in Section 2(8) of the Act. Moreover, the Act
and the Rules form part of a composite scheme. Many of the
provisions of the Act can be put into operation only after the
relevant provision or fonn is prescribed in the Rules. In the
G absence of the Rules the Act cannot be enforced. If it is held
that Rules do not apply to technical educational institutions the
provisions of the Act cannot be enforced in respect of such
institutions. There is, therefore, no escape from the conclusion
that professional and technical educational institutions are
H excluded from the ambit of the Act and the High Court has rightly
STATE OF MAHARASHTRA & ORS. v." RELIANCE 353
INDUSTRIES LTD. & ORS. [ARUN ¥1SHRA, J:]

taken the said view. Since we agree with the view of the High A
Court that professional and technical educational institutions are
not covered by the Act and the Rules, we do not consider it
necessary to go into the question whether the provisions of the
Act fall within the ambi~ of Entry 25 of List III and do not relate
to Entry 66 of List I."
B
23. It was also submitted that definition ofland means land in the
ordinary sense. Therefore, the definition only provides for what it
additionally includes. Learned Counsel for the respondent has relied upon
Jagir Singh v. State ofBihar (1976) 2 SCC 942, thus:
"21. The definition of the term "owner" is exhaustive and intended c
to extend the meaning of the term by including within its sweep
bailee of a public carrier vehicle or any manager acting on behalf
of the owner. The intention of the legislature to extend the
meaning of the term by the definition given by it will be frnstrated
if what is intended to be inclusive is interpreted to exclude the
actual owner. D
b. Black Diamond Beverages v. C10, (1998) l SCC 458 at
page 461
7. It is clear that the definition of "sale price" in Section 2(d)
uses the words "means" and "includes". The first pa1t of the E
sl_e_(\giti_911_.Qg_fin_gs tl1e tl}Q.i!Ding_9f th.Q.'N2I\!.''salg_m!c;.ti~nmtmu1'J,
in our view. be given its ordinmy popular or natural meaning.
The interpretation thereofis in no way controlled or affected by
the second part which "includes" certain other things in the
definition. This is a well-settled principle of construction. Craics
on Statute Law 7th Edn. I .214) savs: F
"An interpretation clause which extcncL5 the meaning of a word
does not take away its ordinary meaning .... Lord Se I borne
said in Robinson v. Baiton-Eccles Local Board [( 1883) 8 AC
798: 53 LJ Ch 226JAC atp. 801:
G
'An interpretation clause of this kind is not meant to prevent
the word receiving its ordiniuy, popular and natural sense
whenever that would be properly applicable but to enable the
word as used in the Act ... to be applied to something to which
it would not ordinarily be an applicable."'
(Emphasis supplied) H
354 SUPREME COURT REPORTS [2017] IO S.C.R.

A Reliance has also been placed in this regard on Reserve Bank of
India v. Peerless General Finance & Investment Co. Ltd. & Ors.
( 1987) 1 sec 424.
24. In Jagir Singh v. State of Bihar (supra) this Court has
considered the definition of owner. This Court has observed that the
B legislative intent to be frustrated if interpreted to exclude the intent of
the actual owner. There is no dispute with the aforesaid proposition,
however, the definition of the land is inclusive and does not exclude
actual owner. In case the State is found to be the owner of the land, it
cannot be deprived ofacquisition of the structure sta1idingthereon. That
the interpretation made by us is notto exclude the owner but the purposive
c interpretation fulfils and recognizes concept of the dual ownership which
has become common in the present day context. Moreover, the interest
in part of the entire house, building or manufaetory can be acquired.
The building ultimately forms part ofthc land and things attached to the
earth and permanently fastened to anything attached to the earth and
D the benefits to arise out of the land.
25. In Reserve Bank of India (supra) this court has laid down
that when legislatures'fesort to inclusive definition i.e. to enlarge the
meaning of words or phrases so as to take in the ordinary, popular and
natural sense of the words depending on the context by process of
E enlarging the definition may even become exhaustive. In our opinion, it
has to be seen in the context of each and every provision in the Act to
find out as to the meaning to be given to the inclusive definition. There
is no dispute with the proposition laid down in the aforesaid decisions.
By the interpretation made by us, there is no question of taking away
very meaning of the land but the acquisition of the right in the land can
F only be with respect to the right of the owner. Obviously, only the interest
belonging to the owner bas to be acquired and as per Section 49 of the
Act, there can be acquisition of the part of the house, building or
manufactory. Once option has not been exercised by the owner by
insisting that whole of the building be acquired, it would be only of the
G interest which is existing in the part ofbuilding, house or manufactory.
The decision in Reserve Bank of India (supra) also fails to sub-serve
the cause espoused by the respondents.
26. In Reserve Bank of India (supra), this Court has clarified
that the Legislatures resort to include the definitions (a) to enlarge the
H meaning of words or phrases so as to take in the ordinary, popular and
STATE OF MAHARASHTRA & ORS. v. RELIANCE 355
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

natural sense of the words and also the sense which the statute wishes A
to attribute to it, (b) to include meanings about which there may be some
dispute, or (c) to bring under one nomenclature all transactions possessing
ce11ain similar features but going under different names. Depending upon
the context, in the process of enlarging, the definition may even become
exhaustive.
B
27. Interpretation must depend upon the text and the context. They
are the basis of interpretation. One may well say ifthe text is the texture,
context is what gives the colour. Neither can be ignored. Both are
important. That interpretation is best which makes the textual
interpretation match the contextual. A statute is best interpreted when
we know why it was enacted. If the statute is looked at, in the context of C
its enactment, with the glasses of the statute-maker, provided by such
context, its scheme, the sections, clauses, phrases and words may take
colour and appear different than the statute is looked at without glasses
provided by the context. We must look at the Act as a whole and discover
what each section, each clause, each phrase and each word is meant D
and designed to say as to fit into the scheme of the entire act. No part of
a statute or word of a statute can be construed in isolation.
28. The Land Acquisition Act, 1894 was enacted since the Act of
1870 was found entirely ineffective for the protection either of the persons
interested in lands taken up or of the public purse. The object of the E
Land Acquisition Act, 1894 was to amend the then existing law for
acquisition of law for public purpose and to determine the adequate
amount of compensation to be paid on account of such acquisition.
29. By looking at the definition as a whole in the scheme of the
entire Land Acquisition Act and by reference to what preceded the F
enactment and the reasons for it, we have interpreted the word 'includes'.
The word 'include' is opposite to the word 'exclude'. If the interpretation
as suggested by the learned counsel for the respondents is accepted,
then the definition of the land could not become an inclusive definition
but the definition of "land" excludes certain factors. The expression
'land' includes benefits arising out of the land and things attached to the G
earth or permanently fastened to anything attached to the earth. The
portion of the building cannot survive independent of the building and the
building without the land. The word "land" should be understood having
been covered by the elongated definition since it defines with
inclusiveness that part of the building. H
356 SUPREME COURT REPORTS [2017] JO S.C.R.

A 30. Having regard to the true intent of the meaning of the word
'land', the only interpretation possible in the context is the interpretation
as made by us, inasmuch as such interpretation will not take away the
very meaning of the land. In the matter on hand, owner of the land is the
State whereas the owner of the building is a respondent. Since, building
cannot stand without the land, the building also becomes part of the land.
B
However, since the owner of the building is different from the owner of
the land, and if a portion of the building is required for public purpose, it
is open for the State to· acquire that portion of the building by paying
adequate compensation in respect of that portion of the building, as well
as, in respect of proportionate diminution of the user if any of the land
c under Section 23 of the LandAcquisition Act, 1894, in accordance with
law.
III. In Re : Object and Scheme of the Act
31. It was further submitted on behalf of the respondents that to
consider the context of definition of land the object and scheme of the
D Act has to be taken into consideration. Reliance has been placed on
Gimar Traders v. State of Maharashtra, 2011 (3) SCC I.
"55. The LandAcquisitionAct was enacted as it was considered
expedient to amend the law for acquisition of land needed for
public purposes and for companies and paiiieularly for payment
E and determination of the amount of compensation to be paid on
account of such acquisition. The Land AcquisitionAct. 1870 made
it obligat01y for the Collector, to refer the matter to civil courts
for a decision in cases of difference of opinion with interested
person(s) as to value of the land as well as cases in which one of
F the claimants was absent, was the Collector was not empowered
to make an award ex-parte even afrer notice. This requirement
resulted in a lot of litigation, delay and expenses. According to
the Statement of Objects and Reasons of the Land Acquisition
Act the Act of 1870 had not, in practice, been found entirely
effective for the protection either of the persons interested in
G lands taken up or of the public purpose. Thus, the law was
amended by making the Collector's award final unless altered
by a decree. The persons interested in the land thus still have the
opportunity, if they desire, to prefer to an authority, quite
independent of the Collector, their claims for more substantial
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 357
INDUSTRIES LTD. & ORS. [ARUN MISHRA,.J.]

compensation than ·what the Collector has awarded. Procedure A
for determining the valuation of l<!nd was also proposed to be
suitably changed.
56. Major amendments were proposed by Central Act 68of1984
to the Land Acquisition Act. The Statement of Objects and
Reasons for this amending Bill posited that due to enonnous B
expansion of the State's role in promoting public welfare and
economic development since independence, acquisition ofland
for public purposes, industrialisation, building of institutions, etc.
has become far more numerous than ever before. Acquisition of
land for private enterprises ought not to be placed on the same
footing as acquisition for the State or for an enterprise under it. c
The individuals and institutions who are unavoidably to be deprived
of their property rights in land need to be adequately compensated
for the loss keeping in view the sacrifice they have to make for
larger interest of the community. The pendency of acquisition
proceedings for long periods ofien caused hardship to the ailected D
parties and rendered unrealistic, the scale of compensation
offered to them.
57. With this background the legislature felt that it was necessmy
to restructure the legislative framework for acquisition ofland
·.so that it is more adequately governed by the objective of serving E
the interests of the community in harmony with the rights of the
individuals. Recommendations on similar lines were also made
by the Law Commission and while considering these proposals
for amendment, the legislature carried out various amendments
of significance in the existing Land Acquisition Act.
F
58. Besides enlarging the definition of"public purpose", provision
was also made for acquisition of land for non-governmental
companies. Fmther, it provided the time-limit for completion of
all formalities between issue of preliminary notification under
Section 4(1) and declaration under Section 6(1) of the Land
Acquisition Act. Section 11-A of the Land Acquisition Act was G
introduced which provided for time-limit of two years, from the
date of publication of declaration under Section 6 of the Central
Act, within which the Collector should make its award under
that Act. Provision was also made for taking of possession of
H
358 SUPREME COURT REPORTS [2017) IO S.C.R.

A land by the Collector before the award is made in urgent cases.
59. From the objects <md reasons of the Land Acquisition Act it
is clear that the primary object of this Act is acquisition ofland
for a public purpose which may be "planned development" or
even otherwise. In fact the provisions of the Land Acquisition
B Act do not deal with the concept of development as is intended
under the specific statutes like the MRTP Act, the Delhi
Development Act 1957, the Bangalore Development Authority
Act, 1976 (for short "the Bangalore Act"), etc. The primary
purpose of the LandAcquisitionAct is to acquire land for public
purpose and for companies as well as to award compensation to
c the owners/interested persons in accordance with the provisions
of this Act.
60. The acquisition proceedings commence with issuance of a
notification under Section 4 of the Land Acquisition Act against
which the interested persons arc entitled to file objections which
D will be heard by the competent authority in accordance with the
provisions of Section 5-A leading to issuance of declaration under
Section 6 of the Land Acquisition Act. After complying with the
requirements of Section 9 of the Land Acquisition Act, the
Collector is expected to make an award under Section 11 of the
E Central Act and interms of Section 11-A of the Land Acquisition
Act. if the award is not made within two years from the date of
publication of the declaration the acquisition proceedings shall
lapse.
64. As is evident from the afore-narrated provisions the primary
F purpose and the only object of the Land Acquisition Act is
acquisition of land and payment of compensation for such
acquisition. It is not an Act dealing in extenso or otherwise with
development and planning. The scheme of this Act is very simple.
Despite the fact that it is compulsory acquisition which is in
exercise of the State's power of eminent domain the legislature
G has still attempted to create a balance between compulsory
acquisition on the one hand and rights of owner/interested person
in land on the other. The acquisition proceedings are commenced
with issuance of a notification under Section 4 of the Land

H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 359
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]
,,c.

Acquisition Act for a public purpose and would end with the A
payment of compensation for such acquired land. The
mechanism provided under this Act is entirely rclatable to the .
process of acquisition of land and payment of compensation.
66. The LandAcquisitionAct itself is a self-contained code within
the framework of its limited purpose i.e. acquisition of land. It· B
provides for complete machine for acquisition ofland including
the process of execution, payment of compensation as well as
legal remedies in case of any grievances."
32. The respondents for the proposition that acquisition ofland is
dominant purpose of Act as such land has to be necessarily acquired c
under the Act have relied upon T.L. Prakash Ram Rao v. The District
Collector, Ananthapur & Ors., ( 1993) 2 AP LJ 421 (HC) at page 422
in which the Andhra Pradesh High Court has laid down thus:
"2 ..... Under the provisions of the Land Acquisition Act the
dominant purpose is acquisition of land and that land may be D
vacant may contain structures may contain trees and may.also
contain wells. The Act never contemplates of acquisition of a
well for the purpose of drawing water as a dominant purpose.
To say that in acquiring the water sow·ce land also is involved,
.and as such the Act is applicable will be simply misreading the
provisions of the Act and particularly the definition of 'land' E
thereunder. Section 3(a) of the Act defines 'land' as including
benefits arise out of land and things attached to the earth or
permanent fastened to anything attached to the earth. The
definition ofland employed therein is similar to that of the words
'immovable property' in the General Clauses Act 1897. May be F
that the definition of land is not exhaustive but is inclusive
definition but by stretching any far it cannot be deduced that the
dominant purpose need not be acquisition ofland. Stretching the
definition ofland to an extent what is inevitable is the acquisition.
of land that should be a dominant purpose and consequentially
the things attached to the said land be it buildings trees crops or G
wells can also be pai1 of acquisition. But if the dominant purpose
is only to acquire a water source and then to notify the land
involving the same the said acquisition docs not amount to
acquisition of land and the Act is not at all applicable. It is clear
H
360 SUPREME COURT REPORTS [2017] lOS.C.R.

A from the stand taken by Navodaya School -the 3rd respondent
herein, which is beneficiary of the acquisition in the affidavit
filed by it in support of the implead petition that the land is sought
to be acquired for providing water source to the Navodaya School.
The public purpose under the Act can be for providing land, be it
vacant or with structures. trees or borewells, for certainly not to
B
the extent of grabbing somebody's water source and for that
purpose mention the land surrounding the said borcwcll as a
necessary consequence. Indisputably. the rcqu.isitioning authority
docs not require the land for any public purpose; but they need
water to cater to the needs of the students. staff and other
c workers ofNavodaya School and as the water did not strike in
the premises of the Navodaya School and rich water struck in
the land of the petitioner, the said water source is sought to be
acquired. As the Land Acquisition Act does not permit this kind
of acquisition the petitioner cannot be deprived of his property
and if it is done the same will be in infraction of constitutional
D
guarantee under Article 300-A of the Constitution oflndia.''
33. In our opinion, the submission with respect to object and scheme
as discussed in Gimar Traders (supra) and T. L. Prakash Ram Rao
(supra) docs not come in the way of acquisition. The object is to
compensate the owner adequately. There is no doubt that pendency of
E acquisition proceedings are not to cause hardship to the affected parties.
The purpose of the Act is to make additions for the public purpose and to
award to the owners/ interested persons compensation in accordance
with the provisions of the Act. The acquisition has been made for the
public purpose in the instant case. The decision in the case of T.L.
F Prakash Ram Rao (supra) does not come in the way of acquisition.
The court has observed that definition of the land is not exhaustive, but
is inclusive definition; but by stretching any far it cannot be deduced that
the dominant purpose need not be acquisition of land and the things
~ttached to the said land can also be pai1 of the acquisition. But if the
dominant purpose is only to acquire a water source and then to notify
G the land involving the same, the said acquisition does not amount to
acquisition ofland and the Act is not at all applicable. That situation was
totally different from the instant case as the entire floors are being
acquired for the purpose of housing of the offices and there is acute
paucity of such spaces particularly in Mumbai and nearby places. When
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 361 .
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.)

flats can be sold independently, obviously they can be acquired also. As A
all the rights in the floor are being acquired and the land beneath it need
not be acquired more so it belongs to the Government there can be valid
acquisition of such floors independently without land in such cases.
IV. In Re : Whether State to acquire its own land underneath
the buildings or other interest ? B
34. The instant matters are of dual ownership. In both the cases
owners of the building are not the owners of the land. The land belorigs
to State of Maharashtra or Port Trust. In such a situation where the
Government is the owner of the site, obviously Government could not
have acquired the land and in the case of its own ownership, there was c
no necessity for the acquisition ofland. The Privy Council has considered
the precise question in Hari Chand & Ors. v. Secretary of State AIR
(1939) PC 235 at page 236. In the said case a notification was issued
which was served upon the proprietors of bungalows in which it was set
out that the Government claimed to be the owner of the land upon which
various btmgalows and outhouses were erected. They were desirous of · D
acquiring the building thereon under the Act. An objection was raised
that the notification was bad because it was not a notific~ition for
acquisition ofland but a notification with intention for acquiring building
on the land. As such the proceedings under the Land Acquisition Act
were fundamentally bad because the notification upon which the E
proceedings started was invalid. The Privy Council has held that when
the Government was the owner of the site, building on the land could
have been acquired. The Privy Council in Hari Chand (supra) considered
the submissions urged during the compensation proceedings with respect
to acquisition of building and not the land. It observed:
F
" ...... Accordingly a notification was served on ·each of the
proprietors of the bungalows, and in the recital of each notification
it is set out that the Government claimed to be the owners of the
land upon which the various bungalows and outhouses had been
erected. That is set out as a matter of narrative in the notification.
Then it proceeds to state that the Government have given notice G
that the land has been resumed by them and that they are desirous ·
now of acquiring the buildings thereon and ant_other outstanding
interest therein, and for that purpose they invoke the provisions
of the Land Acquisition Act of 1894.
H
362 SUPREME COURT REPORTS [2017] JO S.C.R.

A The first point taken here has been that the notification was bad
because it was not a notification for the acquisition of the land,
but a notification of an intention to acquire only buildings on the
land. It was said that the Land Acquisition Act only authorized
notification of an intention to acquire land and therefore that the
whole proceedings under the Land Acquisition Act were
B
fundamentally bad because the notification upon which the
proceedings started was invalid. It has to be noticed however
that in the Land Acquisition Act the expression 'land' includes
benefits to arise out of land, and things attached to the earth or
permanently fastened to anything attached to the earth.
c In the present case the Government's position being that
they were the owners of the site, it.would have been manifestly
idle for them to have proposed to acquire what was already their
own, and therefore when they sought to put in force the provisions
of the Land Acquisition Act they naturally requisitioned what
D was not their own but what they desired to acquire, namely the
buildings on the land. It appears to their Lordships that in any
event this objection to the notification comes too late, because
the parties proceeded under the Land Acquisition Act to follow
forth all the procedure which that statute lays down right up to
and including the final determination of compensation. The Court
E that dealt with the matter was really a compensation Court, and
if it had been intended to attack the whole proceedings as initially
invalid this would more properly have been done before some
other tribunal. The Court did however incidentally consider the
question of the validity of the notice, and their Lordships agree
F with the view takenthat the notification is not open to objection.
Junior counsel for the appellants sought to satisfy their Lordships
that the statement in the recital, namely that the site belonged to
the Government, was in fact, inaccurate and that the claimants
were entitled to the sites upon which the various bungalows were
erected. One thing is quite clear from the legal point of view and
G that is that a claimant who desires to obtain compensation must
establish his title, and in the ease to which we were referred, the
recent case in Secretary of State v. Satish Chandra Sen ( 1931)
18 AIR P. C I where the question of Cantonment tenure in Bengal
was under consideration, it was made clear that al claimant must
H establish his title affirmatively. In the present case it may be that
STATE OF MAHARASHTRA & ORS. v. RELIANCE 363
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.)

there might be some question as to the Government's title, but it A
was for the claimants themselves to establish affirmatively their
title to the sites. The Courts below ~hich had the advantage of
having documents before them which have not been before their
Lordships, went very fully into the matter and satisfied themselves
that the claimants here had not established their title to the sites.
B
Their Lordships see no reason to differ from this conclusion." .
35. In R. Umraomal & Ors. v. State of Tamil Nadu & Anr. AIR
- 1986 Mad. 63, a Division Bench of the High Court of Madras has laid
down that !~e Act does not contemplate or provide for acquisition of any
interest in land belonging tb Government which is being acquired under
·the Act and the Government is the owner of the land which need not C
acquire the land. Because no question of Government acquiring what is
its own. The court observed;
"4. The notification in G.O. Ms. No 2753 Revenue, dated 15-
12-1980 shows that the Government of Tamil Nadu intended to
acquire 'the superstructures on the land in R. S. No. 80 and 882/ D
2 in Tondiarpet village, Tondiarpet taluk, Madras Dt, for the purpose
of assigning the lands and the superstructures thereon to provide
for' shopping facilities to small trnders and self-employed persons'.
The impugned declaration under S. 6 of the Land Acquisition Act
1894, reads that the superstructures on the lands specified in the E
schedules are needed for a public purpose, to wit, for the purpose
of assigning the lands and the superstructures thereon to provide
for shopping facilities to small trnders and self-employed persons.
The contention of the learned counsel Mr. Dolia, for the appellants,·~~
is that the Government should have resorted to the Tamil Nadu
Requisitioning and Acquisition oflmmovable Property Act 1956 F
as that is the special enactment for acquisition of buildings and
should not have resorted to the LandAcquisitionAct 1894, which
is a Central enactment which provides for acquisition ofland for
public purposes and for companies, and in fact in one of the grounds
in the memorandum of appeal, it has been pointed out that the G
notification under the provisions of the Land Acquisition Act is
void and without jurisdiction. This contention, in our view, is not
well-founded for the simple reason that under S. 3 of the Land
Acquisition Act (Act 1 of 1894) the expression 'land' includes
things attached to the earth or things permanently fastened to
H
364 · SUPREME COURT REPORTS (2017] 10 S.C.R.

A anything attached to the earth. Secondly, it must be noted that the
lands in question belong to Government and the appellants are
lessees of the land. It is therefore clear that the Government did
not propose to acquire what was already their own, but only the
superstructures built upon their lands. In Deputy Collectm;
Calicuf'Dn. v. Aiyavu, (1911) 9 Ind Cas 34 l, Wallis J. as he then
B
was, observed-
"It is, in my opinion, clear that the Act does not contemplate or
provide for the acquisition of any interest which already belongs
to Government in land which is being acquired under the Act,
but only for the acquisition of such interests in the land as do
c not already, belong to the Government."
It is, therefore, manifest that when the Government is the owner
of the land, it need not acquire the land, because there can be no
question of Government acquiring what is its own. It has therefore
to acquire only the superstructures which stood on the land
D belonging to it and such an application (acquisition?) can be made
under the Land Acquisition Act (Act 1of 1894). We are, therefore,
of the view that the Government was not wrong in resorting to
Act I of 1894. That disposes of one of the challenges made to the
impugned notification."
E 36. A Division Bench of the High Court ofAllahabad in Secretmy
of State v. Allahabad Bank Ltd. AIR 1939 All. 34 observed that it is
open to the Government to deny that the owners have any interest in the
land as opposed to the buildings. What has been emphasized is that the
Government would have to make a claim to all the interests of the owners
F of the buildings, whatever that might be. It was held that the reference
under section 18 could not have been refused on the ground that
Government have in effect acquired the buildings and not the lands forming
site of the buildings. In the said case, court observed:
"5. From the above it is clear that the view of the Full Bench was
G that in order that proceedings under the Act should be taken the
Government were bound to acquire the land, that is to say, they
could not claim to acquire buildings only, they were bound to claim
the acquisition of the whole interest of the ownerofthe buildings.
It was open to the Government to deny that the owner had any
interest in the land as opposed to buildings, but in order to bring
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 365
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.)

the proceedings within the Act the Government would have to A
make a claim to all the interest of the owner of the buildings ,
whatever that might be."
37. It was submitted on behalf of the respondents that definition
of land under section 3(a) ofthc Actincludes "benefits to arise out of
land and things attached to the earth or permanently fastened to anything B
attached to the earth" but docs not define land as meaning "benefits to
arise out ofland, and things attached to the earth or permanently fastened
to anything attached to the earth". Thus, there cannot be an acquisition
of only a portion of a building without acquiring the underlying land. The
submission is based upon Raja Shyam Chunder Mardraj & Ors. v.
The Secretary of State for India in Council (1907-08) 12 CWN 569 ·c
at page 572. Following is the relevant discussion made by the Calcutta
High Court:
"The first matter which strikes us in connection with, and which
seems to be a fatal objection to these proceedings is that the
rights of fishery which have now been acquired were previously D
acquired by Government in 1896. The Government then took up
the foreshore over which the fishery rights now to be acquired
are exercised, and consequently acquired the foreshore and all
rights existing in connection with it and exercised over it. The
Government cannot therefore take them up again. The second E
objection to these proceedings is that the Government is now
taking up fishery rights, that is incorporeal rights without taking
up the land over which they are exercised and which, as already
pointed out Government has already taken up, and which is it.s
own property. Government cannot in our opinion do this under
the LandAcquisitionAct. Land is defined in the Act as including F
benefits arising out ofland, etc. But land is not defined as meaning
benefits arising out ofland. Therefore, fishe1y rights are not land,
and it is only land, including the rights arising out of it, but not the
rights detached from the land, that can be acquired under the
Act. The Government pleader calls our attention to the definition G
of "persons interested," in which it is said that a person shall be
deemed to be interested in land, if he is interested in an casement
affecting the land." This is no doubt correct, but it does not follow
that because a person interested in an easement affecting the
land may be entitled to share in the compensation awarded for
H
366 SUPREME COURT REPORTS [2017] JO S.C.R.

A the land that an easement comes within the definition of land.
and can be acquired under the Act detached from the land
affected by it."
38. In order to buttress the aforesaid submission, reliance has also
been placed on Dasarath Sahu & Ors. v. Secy. of State, AIR 1916
B Pat. 330(1) in which the Comt has laid down thus:
"2. The proceedings appear to have been misconceived from
the outset. No doubt the definition in Section 3(a) of the Act
includes in the word "land" things attached to the earth, but the
Act does not contemplate the acquisition of things attached to
c the land without the land itself. The law upon this point has been
clearly laid down in Shyam Chunder Mardraj v.Secy. of State
[(1908) 35 Cal 525.], where it was held that Government could
not use the Land Acquisition Act for the purpose of acquiring
fishery rights over land which was already the property of
Government. It was pointed out that it is only the land including
D the rights which arise out of it, and not merely some subsidiary
right. which is capable of acquisition under the Act."
39. The respondents have also relied upon the decision of
Allahabad High Court in Makhan Lal & Ors. v. Se(JI. of State, AIR
1934 AIL 260 as to their 'land'. Following is the relevant po1tion of the
E decision:
"22 ..... In Dasarath Sahu v. Secy, o.fState [(1916) 35 IC 97.)
, the Patna High Court held that the term "land" in Section 3(a)
of the LandAcquisitionAct, included things attached to the earth,
and the Act did not contemplate the acquisition of only things
F attached to the land without the land itself.
23. In the case before the Patna High Court an attempt had
been made to acquire things standing on the land apart from the
land itself, and the High Court held that the proceedings were
without jurisdiction. On behalf of the Secretary of State it has
G been argued that in this particular case what was sought to be
acquired was not the site namely the land but only the buildings
thereon. In our opinion this argument is not correct. Firstly, it
would not be open to the Local Government to acquire anything
apart from the land and, secondly, as a matter of fact, the
Notification indicates that what was sought to be acquired was
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 367
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

land. We have quoted the Notification and we may point out that A
the word "land" clearly appears on the face ofit. The Notification
begins with these words: "The land designated below," and under
this Notification appears a specification of the land."
40. In Raja Shyam Chunder Mardraj v. Secretary of State for
India Council (supra), it has been observed that the Government was B
taking up fishing rights without taking up the land over which they are
exercised. It was observed that Government could not have taken up
the fishery rights. It was held that fishery rights are not land, and it is
only land, including the rights arising out ofit, but not the rights detached
from the land can be acquired under the Act. In Dasarath Sahu (supra)
it has also observed that Section 3(a) includes with the word "land" C
things attached to the earth, but the Act does not contemplate the
acquisition of things attached to the land without the land itself. Reliance
was placed on Raja Shyam Chunder Mardraj (supra). In Makhan
Lal v. Secy. of State (supra) and Secretary of State v. Allahabad Bank
Ltd. (supra) the decision in Dashrath Sahu (supra), which has been D
followed.
41. However, this Court in Collector o.f Bombay v. Nusserwanji
Rattanji Mistri andOrs., AIR l 955 SC 298 has considered the question
that when the Government was having interest in the land and acquires
a land under the provisions of the LandAcquisition Act, the Government E
acquires the sum total of private interests subsisting in them. If the
Government has itself an interest in the land it is only to acquire other
interest outstanding therein, the Government interest cannot be acquired
under the Act though an investigation can be made of such interest, but
that would not make the subject of acquisition. This Court observed
thus; F

"(12) We are unable to accept his contention. When the
Government acquires lands under the provisions of the Land
Acquisition Act, it must be for a public purpose, and with a view
to put them to that purpose, the Government acquires the sum
total of all private interests subsisting in them. Ifthe Government G
has itself an interest in the land, it has only to acquire the other
interests outstanding therein, so that it might be in a position to
pass it on absolutely for public user. In In the Matter of the Land
Acquisition Act: The Government ofBombay v. Esupali Salebhai
I.LR [ 1909] Born, 618 Batchelor, J. observed : H
368 SUPREME COURT REPORTS [2017] 10 S.C.R.

A '.1n__QHlt;:L~-9!4B_Qp_y~r.m:J:IJ:.!1L1~~-J. Lscc_l!lli_!Q_fil9~_m_~L!.1.9!
debarred from acquiring and paying for the onlv outstanding
interests merely because the Act, which primarily contemplates
all interests as held outside Government, directs that the entire
compensation based upon the market value of the whole land.
must be distributed among the claimants".
B
There, the Government claimed ownership of the land on which
there stood buildings belonging to the claimants, and it was held
that the Government was bound to acquire and pay only for the
superstructure, as it was already the owner of the site. Similarly
in Deputy Collector, Calicut Division v. Ai ya vu Pillay [1911] 9
c LC. 341, Wallis, .J. (as he then was) observed:
"It is. in my opinion, clear that the Act does not contemplate or
provide for the acquisition ofany interest which already belongs
to Government in land which is being acquired under the Act.
but only for the acquisition of such interests in the land as do
D not already belong to the Government".
:\:_Vith these observations, we arc in entire agreement. When
Government possesses an interest in land which is the subiect of
~1fsmi~iJi..Q.!!. !J!l..Q~r_ll:!g_Ag!,..J..!.rn.U!.1 ter£.§Li.:?_J!~_dLoJ!lliiilf slt.~11
acquisition, because there can be no question of Government
E acquiring what is its own. An investigation into the nature and
value of that interest will no doubt be necessary for determining
the compensation payable for the interest outstanding in the
claimants, but that would not make it the subject of acquisition.
The language of section VIII of Act No. VI of l 857 also supports
F this construction.
Under that section, the lands vest in the Government "free
from all other estates, rights, titles and interests", which must
clearly mean other than those possessed by the Government. It
is on this understanding of the section that the award, Exhibit P,
Ci is framed. The scheme of it is that the interests of the occupants
arc ascertained and valued, and the Government is directed to
pay the compensation fixc.d for them. There is no valuation of
the right of the Government to levy assessment on the lands, and
there is no award of compensation therefore.

H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 369
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

(13) We have so far assumed with the respondents that the right A
of the Government to levy assessment is an interest in land within
the meaning of section VIII of Act VI of 1857. But is this
assumption well-founded? We think not. In its normal acceptation,
"interest" means one or more of those rights which go to make
up "ownership". It will include for example, mortgage, lease,
B
charge, casement and the like, but the right to impose a tax on
land is a prerogative right of the Crown, paramount to the
ownership over the land and outside it. Ui1der the scheme of the
Land Acquisition Act, what is acquired is only the ownership
over the lands, or the inferior rights comprised therein. Section
3(b) of the Land Acquisition Act No. I ofl 894 defines a "person c
interested" as including
"all persons claiming an interest in compensation to be made
on account of the acquisition of land under this Act, and a
person shall be deemed to be interested in land if he is interested
in an easement affecting the land". D
Section 9 requires that notices should be given to all persons
who are interested in the land. Under section 11, the Collector
has to value the land, and app011ion the coinpcnsation among the
claimants according to their interest in the land. Under section
16, when the Collector make an award "he may take possession E
of the land which shall thereupon vest absolutely in the
Government free from all encumbrance". The word
"encumbrance" in this section can onlv mean interests in respect
of which a compensation was made under section 11,. or could
have been claimed. It cannot include the right of the Government
to levy assessment on the lands. The Government is not a "person F
interested" within the definition in section 3(b). and, as already
stated, the Act does not contemplate its interest being valued or
compensation being awarded therefore.
(14) It is true that there is in Act No. VI of 1857 nothing
corresponding to section 3(b) of Act No. I of 1984, but an G
examination of the provisions of Act No. VI of 1857 clearly,
shows that the subject-matter of acquisition under that .Act was
only ownership over the lands or its constituent rights and not
the right of the Government to levy assessment. The provisions
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370 SUPREME COURT REPORTS [2017] lOS.C.R.

A relating to the issue of notices to persons interested and the
apportionment of compensation among them are substantially
the same.''
(Emphasis supplied)
42. In Special Land Acquisition Officer and Rehabilitation
B Officer, Sagar v. MS. Seshagiri Rao & Am: AIR 1968 SC l 045 the
high court has observed that the Government had failed to exercise the
right that it had under the terms of the grant and had adopted the procedure
prescribed by the Land Acquisition Act. In the said factual matrix this
court has laid down that the Act is silent as to the acquisition of partial
c interests in the land but it cannot be inferred therefrom that interest in
the land is restricted because of the existence of rights of the State in
the land cannot be acquired. Where the interest of the owner is clogged
by the right of the State, the compensation payable is only the market
value of that interest subject to the clog. This Court has further observed
that State in a proceeding for acquisition does not acquire its own interest
D in the land, thus

"(4) The High Court also placed reliance upon the judgment of
the Madras High Court in The State of Madras v. A. Y. S.
Parisutha Nadar [1961] 2 M.L.J. 285. In that ease the main
question decided was whether it was open to a claimant to
E compensation for land under acquisition to assert title to the land
notified for acquisition as against the State Government when
the land had become vested in the Government by the operation
of the Madras Estates (Abolition and Conversion into Ryotwari)
Act 26 of 1948. On behalf of the State it was contended that
F once an estate is taken over by the State in exercise of its powers
under the Estates Abolition Act, the entire land in the estate so
taken over vested in the State in absolute ownership, and that no
other claim of ownership in respect of any parcel of the land in
the estate could be put forward by any other person as against
the State Government without obtaining a ryotwari patta under
G the machinery oftheAct. The High Court rejected that contention
observing that the Government availing itself of the machinery
under the Land Acquisition Act for compulsory acquisition and
treating the subject-matter of the acquisition as not belonging to
itself but to others. is under an obligation to pay compensation as
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 371
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

provided in the Act, and that the Government was incompetent A
in the proceeding under the Land Acquisition. Act to put forward
its own title to the property sought to be acquired so as to defeat
the rights of persons entitled to the compensation. The propositions
so broadly stated are, in our judgment, not accurate. The Act
contemplates acquisition of land for a public purpose. By B
acquisition of land is intended the purchase of such interest
outstanding in others as clog the right of the Government to use
the land for the public purpose. Where the land is owned by a
single person. the entire market value payable for deprivation of
the ownership is payable to that person: if the interest is divided,
for instance. where it belongs to several persons, or where there C
is a mortgage or a lease outstanding on the land, or the land
belongs to one and a house thereon to another, or limited interests
in the land are vested in different persons, apportionment of
compensation is contemplated. The Act is. it is true. silent as to
the acquisition of partial interests in the land, but it cannot be
inforred therefrom that interest in land restricted because of the D
existence of rights of the State in the land cannot be acquired.
When land is notified for acquisition for a public purpose and the
State has no interest therein, market value of the land must be
determined and apportioned among the persons entitled to the
land. Where the interest of the owner is clogged by the right of E
the State, the compensation payable is only the market value of
that interest, subject to the clog. .,
( 5) We arc unable to agree with the High Court of Madras that
when land is notified for acquisition, and in the land the State has
an interest, or the ownership of the land is subject to a restrictive F
covenant in favour of the State, the State is topped from setting
up its interest or right in the proceedings for acquisition. The
State in a proceeding for acquisition docs not acquire it§ own
interest in the land. and the Collector offers and the Civil Court
assesses compensation for acquisition of the interest ofthe private
persons which gets extinguished by compulsory acquisition and G
pays compensation equivalent to the market value of that interest.
There is nothing in the Act which prevents the State from claiming
in the proceeding for acquisition ofland notified for acquisition
that the interest proposed to be acquired is a restrictive interest.
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372 SUPREME COURT REPORTS [2017] 10 S.C.R.

A (6) We agree with the observations made by Batchelor, J .• in
Government of Bombay v. Esufali Salebhai I.LR. 34 Born. 618:
"The procedure laid down in the Act is so laid down as being
appropriate to the special case which is considered in the Act,
i.e., the case where the complete interests arc owned privately.
B But that special case is, as I understand it, singled out by the
legislature as the norm or type with the intent that in other cases
which only paitially confrmn to the type the procedure should be
followed in so far as it is appropriate, nor that such cases should
be excluded from the Act because they do not wholly conform
to the type. In other words. Government. .. arc not debarred
c from acquiring and paying for the only outstanding interests mere Iv
because the Act. which primarilv contemplates all interests as
held outside Government, directs that the entire compensation
based upon the market value of the whole land. must be distributed
among the claimants. In such circumstances. as it appears to
D me, there is no insuperable objection to adapting the procedure
to the case on the footing that the outstanding interests, which
arc the only things to be acquired. are the only things to be paid
for."
The principle of Esu(ali Salebhai's case l.L.R. 34 Born. 618
E was it mav be observed. approved by this Court in The Collector
o(Bombav v. Nussenvanji Rattanii Mistri & Others 1955 SCR
I311 =(AIR 1955 SC 298)."
(Emphasis supplied)
43. In view of the authoritative pronouncement made by this Court
F in Special Land Acquisition Officer and Rehabilitation Office1;
Sagar v. MS. Seshagiri Rao & Anr: (supra), Collector of Bombay v.
Nusserwanji Ratt(//?ii Mistri and Ors. (supra), the decision in Raja
Shyam Chunder Mardraj v. Secretary of State for India Council
(supra) of Calcutta High Court, Dasarath Sahu v. Secy. ofState (supra)
G by Patna High Court (supra), Mak/um Lal v. Secy of State (supra) of
Allahabad High Comt which was followed in Dasarath Sahu (supra)
and also the decision of Secretary of State v. Allahabad Bank Ltd.
(supra) of the same High Comt following Dasarath Sahu (supra) can
no longer be said to be laying down a good law and are hereby overruled.

H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 373
INDUSTRIES LTD. & ORS. (ARUN MISHRA, J.]

VIII. In Re : Acquisition of part of building without land under A
section 49 of the Act.
44. It was further submitted that Section 49 of the Act does not
empower the acquisition of any building or part thereorde hors the
underlying land. The submission to that effect to be accepted would
require ownership of the land with owner of the building and owner has B
required by expressing desire that the whole of the building with land be
acquired is not the factual scenario in the instant ease. The land upon
which the building is standing need not be acquired and there is no
necessity to acquire it. There can be acquisition of part of the building
or the house or manufactory as the owners have not exercised their
option to insist for acquisition for whole of the building as such only the C
rights which they have in the particular floors are being acquired. No
doubt about it that under proviso to Section 49(1) there can be acquisition
ofland beside the part of the building, house or manufactory and when
the land is proposed to be taken, the dispute as to whether it does or
does not form part of the house, manufactory or building, the Collector D
shall refer the determination of such question to the Court.
45. In State ofBihar & Am: v. Kundan Singh & Anr. AIR 1964
SC 350, this Court had considered the provision of section 49 and has
observed thus;
"10 ....... The provisions of s. 49( l) prescribe, inter alia, a definite E
prohibition against putting in force any of the provisions of the
Act for the purpose of acquiring a part only of any house, if the
owner desires that the whole of such house shall be acquired.
This prohibition unambiguously indicates that if the owner
expresses his desire that the whole 6f the house should be F
acquired, no action can be taken in respect ofa part ofthc house
under any provision of the Act, and this suggests that where a
part of the house is proposed to be acquired and a notification is
issued in that behalf, the owner must make up his mind as to
whether he wants to allow the acquisition of a part of his house
or not. Ifhc wants to allow the partial acquisition, proceedings G
would be taken under the relevant provisions of the Act and an
award directing the payment of adequate compensation would
be made and would be followed by the taking of possession of
the property acquired. If, on the other hand, the owner desires
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374 SUPREME COURT REPORTS [2017] 10 S.C.R.

A that the whole of the house should be acquired, he should indicate
his desire to the Land Acquisition officer and all further
proceedings under the relevant provisions of the Act must stop.
This provision thus seems to suggest that ifan objection is intended
to be raised to the acquisition of a part of the house, it must be
made before an award is made under s. 11. In fact, it should be
B
made soon after the initial notification is published under s. 4;
otherwise, if the proceedings under the relevant provisions of
the Act arc allowed to be taken and an award is made, it would
create unnecessary confusion and complications if the owner at
that stage indicates that he objects to the acquisition of a part of
c his house; at that stage, it would no doubt be open to him to claim
adequate compensation in the light of the material provisions of
s. 23 of the Act, but that is another matter."
This Court has further laid down in Kundan Singh (supra) that
the reference to be made under the second proviso to section 49( 1)
D cannot be mixed up with a claim which can be made in reference
proceedings sent to the court under section 18 by the Collector thus;
"11. The first proviso to s. 49( l) also leads to the same conclusion.
If the owner has made his objection to the acquisition of a pa1t
of his house, it is open to him to withdraw or modify his objection
E before an award is made under s. 11; and if he withdraws his
objection, fu1ther proceedings will follow and ifhe modifies his
objection, steps will have to be taken as indicated in the other
provisions of s. 49. This proviso therefore, suggests that the
objection of the owner to acquisition of a part of his house has to
be considered and dealt with before an award is made under s.
F I I.
12. It would be noticed that ifan objection is made by the owner
under s. 49(1), the Collector may decide to accept the objection
and accede to the desire of the owner to acquire the whole of
the house. In that case, further proceedings will be taken on the
G basis that the whole of the house is being acquired. In some
cases, the Collector may decide to withdraw acquisition
proceedings altogether, because it may be thought not worthwhile
to acquire the whole of the house; in that case again, nothing
further remains to be done and the notification issued has merely
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 375
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

to be withdrawn or cancelled. But cases may arise where the A
Collector may not accept the claim of the owner that what is
being acquired is a pmi of the house; in that case, the matter in
dispute has to be judicially determined, and that is provided for
by the second proviso to s. 49(1). Under this proviso, the Collector
is under an obligation to refer the matter to the Court and he B
shall not take possession of the land under acquisition until the
question is determined by the Court. In dealing with this matter,
the Comi has to have regard to the question as to whether the
land proposed to be taken is reasonably required for the full and
unimpaired use of the house.
13. Sub-s. (2) of s. 49 seems to contemplate that where land is c
acquired and it is shown to form part of a house, it would be
open to award to the owner of the house additional compensation
under the third clause of s. 23, and so, this sub-section deals with
cases where the claim made by the owner of the house under
the third clause of s. 23 is excessive or unreasonable, and provides D
that the appropriate Government may decide to acquire the whole
of the land of which the land first sought to be acquired forms a
. part_~a.t.h;.r than agree to pay-an unreasonable or excessive
amount of compensation as claimed by the owner. This provision
also emphasises the fact that where land is acquired and it results
in the acquisition of a part of the house connected with the land, E
the owner can make a claim for additional compensation under
s. 23, or he may require, before the acquisition has taken place,
that the whole of the house should be acquired. These are two
alternative remedies available to the owner; ifhe wants to avail
himself of the first remedy unders. 23, he may make a claim for F
additional compensation in that behalf and such a claim would
form the subject-matter of an enquiry under s. 18; if, on the
other hand, he claims the other alternative remedy provided by
s. 49(1 ), that must form the subject-matter ofanother proceeding
which has to be dealt with under s. 49 itself. It is true that in
cases of dispute, this matter also goes to the same Court for its G
decision on a reference by the Collector; but though the Court is
the same the proceedings taken are different and separate and
must be adopted as such. A claim under s. 49 which can be
properly tried by the Court on a reference made to it by the
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376 SUPREME COURT REPORTS [2017] 10 S.C.R.

A Collector under the second proviso to s. 49(1 ), cannot be mixed
up with a claim which can be made in reference proceedings
sent to the Court under s. 18 by the Collector.
14. Section 49(3) merely dispenses with the necessity of issuing
a further fresh declaration or adopting other proceedings under
B sections 6 to I0 in regard to cases falling und~r s. 49(2).
15. Thus, it would be seen that the scheme of s. 49 is that the
owner has to express his desire that the whole of his house should
be acquired before the award is made, and once such a desire is
expressed, the procedure prescribed bys. 49 has to be followed.
c This procedure is distinct and separate from the procedure which
has to be followed in making a reference under s. 18 of the Act.
In the present case, the respondents have taken no steps to
express their desire that the whole of their house should be
acq~ired, and so, it was not open to the High Co mi to allow them
to raise this point in appeal which arose from the order passed
D by the District Judge on a reference under s. 18. That being our
view, we do not think necessary to consider the respondents'
contention that what is acquired in the present proceedings
attracts the provisions of s. 49(1 )."
46. In Jagannath Ganeshram Agrawal & Anr. v. State of
E Maharashtra & Anr. AIR 1986 Born. 241, it was observed that the
requisition cannot continue for long. The authority must make up their
mind to acquire the property. It was held that a part of the building can
also be acquired and there is no restrictiori that such part cannot be
acquired under the Act. The only embargo is that when it initiates
F proceedings to acquire a part of the building, the owner may insist upon
the entire building to be acquired. The High Court has taken note of the
shortage of accommodation at Jalgaon and in many towns ofMaharashtra,
it observed;
"4. .. .... Section 49(1) postulates that the land acquisition
G authority can acquire a part of the building that the only embargo
is that when it initiates proceedings to acquire a part of the
building, the owner of that building may insist upon the entire
building being acquired. Under sub-s. (2) such owner is given
the further option to go back upon his instance under sub-sec. (i)
to acquire the entire building and allow the authorities to acquire
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 377
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

a part of the building. S. 49 far from declaring that a part of the A
building cannot be acquired, clearly postulates that such power
vests in the land acquisition authority. There is, therefore no
impediment in the Government acquiring block No. 10 or any
portion of the said building. In view of shortage of
accommodation at Jalgaon and in many towns in Maharashtra, B
judical notice could be taken of the fact that buildings requisitioned
for public purpose to accommodate public servants posted at
'
such places for discharging their official duties is a continuing
necessity. With the present allocation of funds for construction
of buildings, it is doubtful whether this need would ever be fully
met in the foreseeable future in the State of Maharashtra. the C
need to requisition accommodation is a continuing need. But then,
if the need is perpetual or of a permanent character, even as laid
down in both the decisions of the Supreme Court referred to
above, power to requisition cannot be resorted to. The authorities
must make up their mind to acquire the building or a portion of D
the building, as the case may be. In the case of Collector of
Ako/a v. Ramchandra, AIR 1968 SC 244 under the amended
S. 49( I) of the West Bengal Premises Requisition and Control
(Temporary Provision) Act, the Court granted three years' time
to the Government to acquire the property as the government
wanted that property. So too .in this case, we find that the E
government undoubtedly requisitioned the property for a valid
public purpose to wit, to accommodate the employees of the
State of Maharashtra. There is no gainsaying that acute dearth
of accommodation continues to persist. Providing accommodation
for the officers is urgently necessary in the public interest. As
F
the initial requisition of the premises was in public interest, that
order is unassailable inasmuch as that need continued to exist all
these 30 years and even now. But nothing apparently has been
done to meet the need. The requirement of the government
appears to be of a permanent character, and consequently the
requisition which as observed by the Supreme Court, can only G
be to satisfy a temporary need cannot be reso11ed to or having
been resorted to continue indefinitely. That practically amounts
to acquiring the property without following the procedure laid
down under the Land Acquisition Act and paying the full market
value of the property. However under the Land Acquisition Act
H
378 SUPREME COURT REPORTS [2017] IO S.C.R.

A the Government undoubtedly has power to acquire. As the need
appears to be of a permanent nature, while the requisition cannot
be continued for any length of time because the Government
would be very well within its right to acquire it, any order quashing
the requisition would not be in the interests of justice provided
the government considers the question of acquiring this property
B
within a reasonable time. In the circumstances of the present
case, we think, the government should be able to make up its
mind in this regard within a period of 18 months from today.
Already the petitioners have been deprived of this property for
the last almost 30 years and these writ petitions have been pending
c now for over I 0 months. We are, therefore, not inclined to accede
to the submission of the learned Government Pleader that further
three years time should be given to the government in these
petitions, as was done by the Supreme Court in the case of Jiwani
Kumar Paraki v. First Land Acquisition Collector, Calcutta,
AIR 1984 SC 1707 for deciding upon acquiring the property."
D
(Emphasis supplied)

We approve the interpretation made by the High Court of Bombay
in view of decision in S.P. Jain v. Krishna Mohan Gupta & Ors. (1987)
E l SCC 191, in which this Court has held that law to take a pragmatic
view and also take cognizance of the current capabilities of technology
and lifestyle of the community, this Court has laid down thus:
"18. We are of the opinion that law should take pragmatic view
of the matter and respond to the pw·pose for which it was made
F and also take cognizance of the current capabilities of technology
and life style of the community. It is well settled that the purpose
oflaw provides a good guide to the interpretation of the meaning
of the j\ct. We agree with the views of Justice Krishna Iyer in
Busching Schmitz Private Ltd. case (1977) 2 SCC 835 that
G legislative futility is to be ruled out so long as interpretative
possibility permits. Rcsidcntiality depends for its sense on the
context and purpose of the statute of the project promoted."
47. The respondents have relied on Harsook Das Bal Kishan Das v
First Land Acquisition Collector (1975) 2 SCC 256 in which this Court
has observed:
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 379
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

"6. "Land is defined in Section 3(a) ofthc Act to include benefits A
to arise out of the land and things attached to the earth or
permanently fastened to anything attached to the earth.
Therefore, land contemplated in Section 49(2) of the Act may
be land or land including building or part of a building."
The decision in Harsook Das Bal Krishan Das (supra) does not B
at all help the respondents. In the said ease it has been laid down that
there can be acquisition ofland or part of building, In our opinion, when
State is the owner then it is not necessary to acquire such an interest in
the land.
48. Reliance has also been placed on Saramma Ittichen)'a v. c
State of Kera/a & Ors., AIR 2008 Ker 72 wherein interpretation of
Section 49 ( 1) of the Act has been made. The High Court has held that
Section 49 (1) gives power to the owner who expresses his desire to
acquire the entire building. The owner has a right to withdraw the option
exercised before the award is passed. The words "whole of such house
or manufactory or building" includes land in which it is situated. It was D
not a case of owner not having title in land or that of dual ownership.
The State was not the owner of the land. Ownership of the land was not
in issue in the said case. So the decision is of no help to the cause
espoused by the respondents. In said case it was observed:
"7. Next question is what is meant by acquisition of the whole of E
such house or manufactory or building as mentioned under Section
49(1 ). When the Collector accepts the option to acquire the entire
building, not only the building materials are to be acquired, but
the entire building including the land where the building is situated
need be acquired. In Shaji C. Varkey's case (supra), the Division F
Bench rightly held that the landlord cannot exercise an option to
acquire the bl1ilding materials alone. His right is to exercise the
option to acquire the entire building. 'Entire building' means the
land where the building is situated. There is no provision under
Section 49( I) enabling the land owner to compel the Collector to
acquire the building materials alone and return the land where G
the building is situated. When landlord exercises the option w1der
Section 49(1 ), State can acquire the entire building and decide
either to demolish that part of the building or use it with or without
necessary modifications. The decision of Harsook Das Bal
Kishan Das's case (supra) is also that the land including the H
380 SUPREME COURT REPORTS [2017] 10 S.C.R.

A building has to be acquired once the landlord expresses desire to
acquire the whole building in Rajalak.~hmy v. Assistant Engineer
AIR l 980 Kcrala 68 (FB ), majority of the J udgcs held that when
building alone is acquired, an order can be passed by the Court
for urgent removal of the building makrials by the Government.
But, in that case, Government acquired only the building materials
B
and the building was demolished. But, building materials were
not removed and owner of the building approached the Court for
a direction to remove the building materials. The question when
the building is acquired, whether the land on which building is
situated also to be acquired was not considered.... .A constitution
c Bench of the Supreme Court in D.G. Gose and Co. Pvt. Ltd. v.
State ofKerala, (1980) 2 SCC 410 considered the meaning of
the word 'building' in the context ofKcrala Building Tax Act.
Before considering the definition of 'building' under that Act
natural and ordinary meaning was considered as follows:
D "21. The word 'building' has been defined in the Oxford English
Dictionary as follows:
'That which is built; a structure. edifice: now a structure of the
nature of a house built where it is to stand.'
Entiy 49 therefore inc.ludes the site of the building as its
E component pait. That, if we may say so, inheres in the concept
or the ordinary meaning of the expression building'.
22. A somewhat similar point arose for consideration in
Corporation of the Ci~v of Victoria v. Bishop of Vimcouver
island (AIR 1921 PC 240) with reference to the meaning of
F the word 'building' occurring in Section 197( 1) of the Statutes
of British Columbia, 1914. It was held that the word must
receive its natural and ordinary meaning as' including the fabric
of which it is composed, the ground upon which its walls stand
and the ground embraced within those walls'. That appears to
us to be the con-cct meaning of 'building'."
G
The above decision was followed by the Apex Court in T
Lakshmipathi i: P. Nithyananda Reddy (2003) 5 SCC 150:
AIR 2003 SC 2427 it was observed as follows at paragraph 23:
"23. In D.G Gose Co. (Agents) (L) Ltd v. State (~f' Kera/a
H ( 1980) 2 SCC 410: AIR 1980 SC 271 while dealing with Entiy
STATE OF MAHARASHTRA & ORS. v. RELIANCE 381
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

49 of List II of the Seventh Schedule of the Constitution, making A
a reforence to Oxford English Dictiomuy, this Cow't has held
that the site of the building is a component pa11 of the building
and therefore inheres in it the concept or ordinary meaning of
the expression 'building'. Referring to Corpn. of the City <d'
Victoria v. Bishop of Vancouver Island (AIR 1921 PC 240)
B
it was held (at sec p. 425, para 22) that the word 'building'
must receive its natural and ordinary meaning as 'including the
fabric of which it is composed, the ground upon which its walls
stand and the ground embraced within those walls."
The meaning of Section 49( 1) is made very clear by the decision
of the Supreme Court in Deep Chand v. Land Acquisition C
Officer (AIR 1994 SC 1901 ). The Apex Court after quoting the
section held as follows:
"A reading of the above section shows that a right has been
given to the owner of the land to object to the putting of the
Act into force when only a part of any house, manufactory or D
other building is sought to be acquired and call upon the State
to acquire whole of such house, manufaetory or building.
Therefore, what has been given is a right to object only to
acquisition of part ofthe building, etc. without acquiring the
whole of the house, manufactofy building. In determining the E
question whether the land proposed to be taken was reasonably
required for the full and unimpaired use of the house,
manufactory or building left out of acquisition all that the Court
has to examine is whether the objection is sustainable requiring
the whole of the prope11y, including the house, manufactory or
other building, should be acquired or portion of the property. F
proposed for acquisition should be left out of acquisition for
full and unimpaired use of the house, manufactory or building,
of the property proposed. for acquisition. It is one of
determination of the convenient use and enjoyment of the
unacquired portion of the land or a building, manufacto1y or G
the other house. If the answer is in favour of the land owneF· ·
the only choice left to the Government is either to acquire the
whole property or drop the proposed acquisition: It brings about
no other consequence. In other words the law says --- acquire
the whole prope.rty or leave it. But for the acquisition the owner
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382 SUPREME COURT REPORTS [2017] IO S.C.R.

A is entitled to use the property in any manner he intends to make
use or enjoy it. Obviously the decision by the Civil Court only
hinges upon the convenient or unimpaired use and enjoyment
of the house, manufactory or building with the residue of the
land lefr over after acquiring the other property."
B Therefore, the landlord has to express his desire to acquire the
whole of the building. Once such a desire is expressed before
award is passed, the Land Acquisition Officer has no option, but
to acquire the entire building including the land in which the
building is situated or withdraw from the acquisition and the
building includes the property in which the building is situated
c and if there is any dispute as to whL·ther any land proposed to be
taken docs or does not form part of a house or building within
the meaning of the section, the Collector has to refer the matter
to the civil Court and await the decision of the civil Court for
taking possession of the land.
D From the foregoing discussion, we hold as follows:

(8) The words 'whole of such house or manufactory or building'
includes land in which it is situated. In other words, when entire
·E building is acquired the land in which the building is situated also
has to be acquired by the Government;
(9) If the owner, expresses his opinion only to acquire the building
materials excluding the land in which it is situated, it is not an
option exercised under Section 49( l ):
F
We answer the reference accordingly."
49. There is no dispute with aforesaid proposition but where part
of building that too a multi-storied building is being acquired, the land
need not be acquired more so when the owner of building is not the
G owner of land and his entire interest in part of building can be acquired.
IX. Violation of Article 300A by acquisition in part
50. It was further submitted that without acquisition of the
underlying land, the acquisition ofbnilding or portion thereof amount to
H overreach of the State's power to eminent domain. Reliance has been
STATE OF MAHARASHTRA & ORS. v. RELIANCE 383
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

placed on State ofBihar v. Kameshwar Prasad 1952 SCR 889 in which A
this Court observed:
"It is true. that under the common law of eminent domain as
recognized in the jurisprudence of all civilized countries, the State
cannot take the property of its subject unless such property is
required for a public purpose and without compensating the owner B
for its loss."·
51. Reliance has also been placed by this Court in Trisha/a Jain
& Am: v. State of Uttaranchal & Anr. ·Civil Appeal No.7496-7497 of
· 2005, decided on 5.5.2011, in which this Court observed:
"26. Acquisition ofland is an act falling in the purview of eminent C
domain of the State. It is essentially relates to the eoneeprof
eo1npulsory acquisition as opposed to voluntary sale. It is trite
that no person can be deprived of his property save by authority
ofiaw in terms ofArticle 300A of the Constitution ofindia. The
provisions of the Act provide a complete mechanism for D
'deprivation of property in accordance with the law' as stated
under the Act.Justifiability and fairness of such compensation is
subject to judicial review within the confines of the four corners
of the Act. Once the lands arc acquired under the Act, the
persons interested therein arc entitled to compensation as per
the provisions of the Act." -- E
52. The aforesaid submission is simply to be rejected. In case the
building or portion is acquired without acquiring the underlying land there.
is no question of overreach of the State's power to the eminent doi;nain.
Article 300A interdict taking of the property for a public purpose without
compensating the owner ±:or its loss. In case entire ownership of the F
land does not lie with the owner only the right which is capable ofbeing
acquired would be acquired not something which is non-existent. The
building or part can be acquired and there is no question ofacquisition of
the land in such cases. In adjudication of the compensation as per the
provisions of Section 23, the State is not depriving the respondents of G
their property. There is acquisition ofland by fair procedure along with
reasonable compensation. The action has been taken by the State in
accordance with law. The action is legally justified. Thus, there is no
question of eminent domain being misused or violation of provisions of
Article 300A of the Constitution oflndia.
H
384 SUPREME COURT REPORTS [2017] 10 S.C.R.

A 53. It was also submitted that owner of the land is deprived of his
ownership rights over the land when the State purports to acquire only a
building or portion thereof standing on his land, without acquiring the
underlying land. The submission cannot be accepted as the respondents
are not the owner of the underlying land. Secondly, the acquisition of a
particular floor as per the provision of section 49 of the act is permissible
B
and the entire interest of owner in a particular portion has been acquired
for that he would be compensated. It is not the case of partial acquisition
of the interest on a particular floor. When without selling the land, in a
building, a particular floor can be sold why there could not be acquisition
of particular floor for public purpose.
c 54. With respect to concept of ownership, reliance has also been
placed upon Salmond on Jurisprudence, (J 21h ed. 1966) at pp. 246-24 7,
413, and it was observed:
"According to Sir John Salmond the owner ofa material object
is he who owns a right to the aggregate of its use. Ownership
D denotes the relation between a person and an object forming the
subject-matter of his ownership. It consists in a complex of
rights, all of which arc rights in rem, being good against all the
world and not merely against specific persons. The normal case
ofowncrship can be expected to exhibit the following im:idents:
E a. The owner will have a right to possess the thing which he
owns.
b. The owner normally has the right to use and enjoy the thing
owned: the right to manage it, i.e., the right to decide how it
shall be used: and the right to the income from it.
F
c. The owner has the right to consume, destroy or alienate
the thing.
d. Ownership has the characteristic of being indeterminate in
duration.
G e. Ownership has a residuary character.. ,
There is no dispute that in the aforesaid proposition. The owner
has the right to use and enjoy a particular portion but owner cannot set
up a plea for acquisition of an interest when he does not have that
particular right or interest or title. His right to manage it, right to decide,
H how it shall be used, right to income from it has to be in accordance with
STATE OF MAHARASHTRA & ORS. v. RELIANCE 385
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

the law. Right of individual has to give way to the public purpose on A
being duly compensated by way of fair procedure.
55. It was also contended on behalf ofrcspondcnts that when the
State acquires building or portion thereof without acquiring the underlying
land, the State is depriving the owner not only of his property in the
building but also its property in the underlying land. The owner of the B
land will not be able to exercise his right to use the land to the extent the
building on which it is acquired. Further, if the building has been
compulsorily acquired, the underlying land will be rendered valueless, as
no person would want to buy the underlying land from the owner. Thus,
the owner of the land will be deprived of his right to obtain a fair value or
income from the land upon its alienation ortrnnsfer. Thus, upon acquisition C
of a building, the State also deprives the land owner of his rights in the
land. However, by not acquiring the underlying land, the State is seeking
to evade its obligation to compensate the owner ofland for his loss. The
provisions would become confiscatory.
56. We find no merit in the aforesaid submission. Firstly, it D
presupposes ownership ofland also is with owner of building, ifthat be
so, the owner can exercise the option for acquisition of the entire building
and land which is available under Section 49 of the Act and bes.ides that
the owner can be compensated also in case he is having any interest in
the land and in case his land is rendered of!ess utility obviously he can E
claim compensation under the provisions of the LandAcquisitionAct. If
the land is rendered value less then also ·adequate compensation can be
claimed under the provisions of Section 23 in accordance with law. In
case right is affected in land which is not acquired by severance, for that
also compensation can be claimed. Thus, the submission so placed is
factually incorrect and legally unsustainable. F

IX. Whether valuation method of building mandates acquiring of
'land? ·
57. It was also urged that land and building constitute a single unit
and there cannot be a break-up in valuation of land and building separately G
as such land is necessary to be acquired with building. Reliance has
been placed on decision in State of Kerala v. P.P. Hassan Koya, AIR
1968 SC 120.1 in which this Court observed;
"4. Two questions were urged in support of the appeal:
(1) that the Receiver having accepted the award of the Land H
386 SUPREME COURT REPORTS [2017] 10 S.C.R.

A Acquisition Officer, the respondent could claim compensation
only for the right which he had in the land and the buildings and
the method adopted by the Land Acquisition Officer was in the
circumstances the only appropriate method: and
(2) that the rate of capitalization was unduly high.
B In our judgment, there is no force in either of the contentions.
When land which expression includes by Section 3(a) ofthcAct
benefits to arise out of land and things attached to the earth or
fastened to anything attached to the earth --- is notified for
acquisition, it is notified as a single unit whatever may be the
c interests which the owners thereof may have therein. The pwpose
of acquisition is to acquire all interests which clog
the right of the Government to full ownership of the land. i.e.
when land is notified for acquisition the Government expresses
its desire to acquire all outstanding interests collecfr1ely. That is
clear from the scheme of the Land Acquisition Act.''
D
(Emphasis supplied)
In the aforesaid case there was notification under section 4 of the
Act for acquisition of seven units of land with buildings. The buildings
constructed on the land belonged to the respondent and were let out to
E tenants on rent. This Court has held that when notification is of a single
unit whatever may be the interest of the owners thereof may have therein
the purpose of acquisition is to acquire all interest which clog the right of
the Government to full ownership of the land. In the instant eases, as
the ownership of the land does not lie with the respondents, thus, it was
not necessary to acquire the land. The fact in the said case does not
F help at all. It has been laid down that acquisition of entire interest in the
part is required and there cannot be acquisition of the part of interest in
part of the building, house or manufactory. The entire interest of the
owner has to be acquired and that has been precisely done in the instant
case.
G 58. Reliance has also been placed on the decision of this Court in
Kiran Tandon v. Allahabad Development Authority, (2004) I 0 SCC
74 thus:
"I .I. A question which arises here is as to what method for
determining the value of the property should be adopted when
H
STATE OF MAHARASHTRA & ORS. v. RELIANCE 387
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

the land is comprised ofbuildings, trees or some other additions A
oflike nature. In Parks, J.A.: Principles & Practice (>/'Valuation
(published by Eastern Law House, 1998 fain.) the following
paragraph on p. 332 illustrates the different aspects of the
problem:
"Land with buildings is viewed in a different perspective than B
bare laiid as such. Land and buildings once married become one
unit, and neither land nor building can thereafter be valued
·separately. A building once erected on or married to the site, as
·it is technicallv often termed takes unto itself a value which may
be either greater or less than the cost of erection depending
upon the market situation. If the building properly and. C
economically develops the land, the total value ofthe complete
entity may be worth more than the sum of the Individual valuer.
In such cases, the excess of the composite value over the sum
of the individual values is ascribable as the builder's profit. But
there may also be inst_anccs to the contrary. It is generally D
impossible to arrive at the tme value of the whole by addition of
the parts." ·
12. In Abdullah Jan Mohd. Ganjee v. State ofBihar [(1967) I
SCWR 214] it was observed that a-building standing on the frmd
and the land on which it stands may not for the purposes of the E
Land Acquisition Act ordinarily be regarded as separate units
capable of being separately value(l and the Reference Court in
the normal course should have valued the land and building as
composite property by the evidence furnished by the value of
similar and comparable properties in the neighborhood by
capitalisation of rent or other income received out of the property. F
13. This principle was reiterated in State ofKerala v. P.P. Hassan
Koya [AIR 1968 SC 1201] wherein it was held as under: (AIR
p. 1202, para 5)
"In determining compensation payable in respect of land with G
buildings, compensation cannot be determined by ascertaining
the value of the land and the 'break-up value' of the building
separately. The land and the building constitute one unit, and tiie
value ofthe entire unit must be determined with all its advantages
and its potentialities."
H
388 SUPREME COURT REPORTS [2017] 10 S.C.R.

A 14. In 0. Janardhan Reddy v. Spl. Dy. Collector [( 1994) 6 SCC
456] it was held that where there are irrigation wells in the land,
estimated construction cost of the wells cannot be separately
assessed apart from assessment of market value of the.land and
the value of the land has to be assessed having regard to the
availability of irrigation facility on the land as a prime factor.
B
This view has been reiterated in State of Bihar v, Madheshwar
Prasad [(1996) 6 SCC 197] and State of Bihar v. Ratan Lal.
Sahu [(1996) I 0 SCC 635]. But there is no hard-and-fast rule
that land and building must be valued as one unit. They can be
separately assessed if the large portion of the land is lying vacant
c and is capable of better use as stated by Venkatachaliah J. as
His Lordship then was in Administrntor General of W.B v.
Collector, Varanasi [(1988) 2 SCC 150: AIR 1988 SC 943] and
it will be useful to extract the relevant part of AIR para 8 of the
Report: (SCC pp. 159-60, para 17)
D "Usually. land and building thereon constitute one unit. Land is
one kind of property; land and building together constitute an
altogether different kind of property. They must be valued as
one unit. But when: however the property comprises extensive
land and the structures thereon do not indicate a realisation of
the full developmental potential of the land it might not be
E impermissible to value the prope1iy estimating separately the
market value of the land with reference to the date of the
preliminaty notification and to add to it the value of the structures
as at that time. In this method, building value is estimated on the
basis of the prime cost or replacement cost less depreciation.
F The rate of depreciation is, generally, arrived at by dividing the
cost of construction (less the salvage value at the end of the
period ofutility) by the numberofyears ofutility of the building.
The factors that prolong the life and utility of the building, such
as good maintenance, necessarily influence and bring down the
rate of depreciation."
G
(Emphasis supplied)
The question in the above matter was as to the method for
determining the value of prop~rty that has to be adopted in the facts of
each case. No doubt about it when land and building once married
H becomes one unit, neither land nor building can thereafter be valued
STATE OF MAHARASHTRA & ORS. v. RELIANCE 389
INDUSTRIES LTD. & ORS. [ARUN MISHRA, J.]

separately. But this would not come in the way of determining the A
valuation of a particular floor, all the a~pects of the owners interest and
the bundle of other rights can be taken into consideration including support
provided by the land and value of the land in the locality etc. Value of the
part of the building can also be accordingly assessed.
X. Conclusion : B
59. Thus, we find that the acquisition process to be legal and valid
and the notifications in question are valid and let it be taken to a logical
end. Since there was interim stay by the High Court and thereafter a
status quo order by this Court we direct that the acquisition be completed
as expeditiously as possible. There is no merit in the prayer to drop it. c
60. Accordingly, the appeal is allowed and the impugned judgment
and order passed by the High Court is set aside.

Kalpana K. Tripathy Appeal allowed.