_.,, OFFSHORE HOLDINGS PVT. LTD v. BANGALORE DEVELOPMENT AUTHORITY & Ors.

Judgment

1 S.C.R. 453 .._.,, OFFSHORE HOLDINGS PVT. LTD. v. BANGALORE DEVELOPMENT AUTHORITY & ORS . (Civil Appeal No. 711 of 2011) JANUARY 18, 2011 [S.H. KAPADIA, CJI, DR. MUKUNDAKAM SHARMA, K.S. PANICKER RADHAKRISHNAN, SWATANTER KUMAR AND ANIL R. DAVE, JJ.] Bangalore Development Authority Act, ~976: A B c - ~ .. \ ss. 19(1), 27 and 36-App/icabi/ity of provisions of s.11~ -A of Land Acquisition Act, to BDA Act - HELD: Object of the BOA Act being planned development, acquisition is merely incidental - Acquisition stands on a completely distinct D footing from the scheme formulated which is subject matter of execution under provision of BDA Act - A conjoint reading of ss. 27 and 36 of BDA Act makes it clear that where a scheme lapses, the acquisition may not - Where upon completion of acquisition proceedings, the land has vested in the State Government in terms of s. 16 of the L.A. Act, the acquisition would not lapse as a result of lapsing of the scheme u/s 27 of BDA Act - Neither of the Acts contain any provision in terms of which property vested in the State can ~ be.reverted to the owner - This being the scheme of the E acquisition within the framework of the BOA Act, rlw relevant · F provisions of LA Act, it will not be permissible to bring the · concept of 'lapsing of acquisition' as stated in provisions of s. 11-A of L.A. Act into C~apter IV of BDA Act - Language of s.36 of BDA Act clearly mandates legislation by incorporation and as per the scheme of the two Acts effective and complete G .... ' implementation of State law without any conflict is possible - 1 The provisions of ss. 6 and 11-A of L.A. Act which provide for time frame for compliance and consequences of default : thereof are not applicable to BOA Act - BDA Act is a self- 453 H 454 SUPREME COURT REPORTS [2011) 1 S.C.R. • ~-- 1\\\~ Interpretation of Statutes - Legislation by tontained code - incorporation - Constitution of India, 1950 - Arlicle 246 and 254 - Seventh Schedule - List II - Entries 5 and B - List ff/ - Entry 42. Constitution of India, 1950: A I " B Arlicle 246, Seventh Schedule, List ff/, Entry 42, List II, Entries 5 and B - Acquisition of land under Bangalore Development Authority Act, 1976 - HELD: BDA Act provides for formulation and implementation of schemes relating to c development - Acquisition of land is neither its purpose nor its subject, but is merely an incidental consequence of principal purpose of development of land - The State Legislature is competent to enact such a law and it is referable to power and field contained in Arlicle 246(2) rlw Entries 5 and g 1 B of List II of Seventh Schedule - Entry 42 of list ff/ relates to 'acquisition and requisitioning of property' - D&velopment is not· a subject that finds a place either in the Concurrent List or in the Union List - It cannot be said that Entry 42 of List I/I denudes the State Legislature of the power to the extent that in an enactment within its legislative competence, it cannot incidentally refer/enact in regard to the subject matter falling in Concurrent List. E ' F G . Article 246, Seventh Schedule, Lists I, fl and Ill - Legislative power of the Centre and the States - HELD: It is the essence of a ·Federal Constitution that there should be distribution of legislative powers between the Centre and the Provinces - Entries in the legislative Lists are not the source of power for the legislative constituents, but they merely demarcate the fields of legislation - The power to legislate flows, amongst others, from Arlicle 246 - Land Acquisition Act relates to Entry 42 of List ff/ while BOA Act is relatable to Entries 5 and 18 of List II - Doctrine of separation of powers. Arlicle 254 - Rule of repugnancy - HELD: Repugnancy H would arise only when the provisions of Provincial law and -,- i y • ....._ • • OFFSHORE HOLDINGS PVT. LTD. v. BANGALORE DEVELOPMENT AUTHORITY 455 those of Central legislation both are in respect of the matter A enumerated in concurrent list, and they are repugnant to each other - To examine the repugnancy the doctrine of pith and substance is to be applied - Doctrine of pith and substance, overlapping and incidental encroachments, are in fact species of the same law - Repugnancy would arise in the cases where B both the pieces of legislation deal with the same matter but not where they deal with separate and distinct matters, though of a cognate and allied character - To the doctrine of occupied field resulting in repugnancy, the principle of incidental encroachment would be an exception - On due c application of the principle, BOA Act is actually referable to Entry 5, List II of the Seventh Schedule - Even if s.36 of BOA Act is said to be traceable to Entry 42 of List /ff, in that event this reference would have to be suppressed to give weightage to provisions aimed at development referable to Entries 5 and 0 18 of List If - Doctrine of pith and substance, overlapping, and incidental encroachment, doctrine of ancillariness, Concept of fragmentation (disintegration), doctrine of severability - Discussed - Interpretation of Constitution - Legislative entries. - Interpretation of Statutes - Precedent. E The Bangalore Development Authority, on 3.1.1977, issued a preliminary notification in terms of the Bangalore Development Authority Act, 1976 (BOA Act) for acquisition of certain lands of which the land in question (2 acres and 34 guntas located in Survey No. I 9/20) was F a part. The final notification was issued on 2.8.1978. However, non-finalisE1tion of the acquisition proceedings led to filing of a writ petition before the High Court. The Authority by Resolution No. 1084 dated 28.6.1988 de notified 1 acre and 2 guntas of the land in question. The G writ petition was withdrawn. The appellant purchased the said land. Subsequently, by a letter dated 30.8.2001, the appellant was informed that the de-notification Resolution No. 1084 had been withdrawn by Resolution No. 325/97 dated 31.12.1997. The appellant filed a writ H 456 SUPREME COURT REPORTS [2011) 1 S.C.R. A petition before the High Court seeking to quash the preliminary and the final notifications dated 3.1.1977 and 2.8.1978, respectively. It was contended that the provisions of s. 11-A of the Land Acquisition Act, 1894 were ·applicable to the BOA Act and the award having B been made after a period of more than two years from the date of declaration u/s 6 of the 1894 Act, the acquisition proceedings had lapsed. The writ petition and the writ appeals of the purchaser-appellant having been r dismissed by the Single Judge and the Division Bench· c of the High Court respectively, it filed the instant appeal. A two Judge Bench of the Supreme ·court in Gimar Traders' case 1 considered the question of reading the provisions of the Land Acquisition Act, 1894, as amended by Central Act of 1984, into the provisions under Chapter D VII of the Maharashtra Regional and Town Planning Act, 1966 for acquisition of land thereunder and feeling difficulty to agree with the observations made in Sant Joginder Singh's2 case, referred the matter to a larger Bench. When the case came up before a three Judge. E Bench, even it was of the opinion (Girnar Traders //)3 that· the question of reading the provisions of s. 11-A of the 1894 Act into the provisions of the MRTP Act required consideration by a larger Bench and, as such, the matters ', were referred to the Constitution Bench. A number of 1 F other matters including the instant appeal were tagged with the case of Girnar Traders(//), which was decided by the Constitution Bench on January 11, 2011 [Girnar Traders(///)]'. - Answering the reference, the Court iG

#1. Gimar Traders v. State of Maharashtra 2004 (5) Suppl. SCR 490.

#2. State of Maharashtra v. Sant Joginder Singh 1995 (2) SCR 242.

#3. Gimar Traders v. State of Maharashtra 2007 (9) SCR 383. H 4. Gimar Tfaders v. State.of Maharashtra 2011 (3) SCC 1. ..... OFFSHORE HOLDINGS PVT. LTD. v. BANGALORE DEVELOPMENT AUTHORITY 457 HELD: A

#1. Though the object of the Bangalore Development Authority Act, 1976 (BOA) Act may be pari materia to the Maharashtra Regional and Town Planning Act, 1966 (MRTP Act), there are certain stark distinctions between B some of the provisions of the respective Acts, particularly, where they relate to functions·and powers of the Authority in preparation of plans as well as with respect to acquisition of the land. The instant appeal relates to the BOA Act. [para 10) [489-E-F] c

2.1 The respondent-Bangalore Development Authority (the Authority) came to be constituted in terms of s.3 of the BOA Act. The object of the Authority has been spelt out ins. 14 of the BOA Act which states that the Authority, Inter alia, shall promote and secure the D development of the Bangalore Metropolitan Area and for that purpose, the Authority shall have the power to acquire, hold, manage and dispose of moveable and immoveable property, whether within or outside the area under its jurisdiction, to carry out building, engineering and other operations and generally to do 'all things necessary or expedient for the purpose of such development and for purposes incidental thereto. Thus, the primary object of the BOA Act was to provide for establishment of the development authority, for F . development of the city of Bangalore. and areas adjacent thereto and for the matters connected therewith; and other matters are incidental thereto. The acquisition of : immoveable property is, therefore, for the said purpose E alone. The development scheme has to provide for every G detail in relation to development of the area under the scheme as well as acquisition of land, if any, required. Upon sanction of the scheme, the Government shall publish, in the Official Gazette, a declaration stating the fact of such sanction and that the land proposed to be H - 458 SUPREME COURT REPORTS [2011] 1 S.C.R. A acquired by the Authority for the purposes of the scheme is required for a public purpose. [para 11 and 13) [487-B E; 486-B-C; 487-F-H; 489-C-O] 8 C

2.2 A very important aspect which, unlike the MRTP Act, is specified in the BOA Act is that once the land is acquired and it vests in the State Government in terms of s.16 of the Land Acquisition Act, then the Government upon (a) payment of the cost of acquisition and (b) the Authority agreeing to pay any further cost, which may be incurred on account of acquisition, shall transfer the land to the Authority whereupon, it shall vest in the Authority. The Government is further vested with the power to transfer the land to the Authority belonging to it or to the Corporation as per s. 37 of the BOA Act. [para 16) [492- D B-0) E F

2.3 The provisions of s. 27 of the BOA Act mandate the Authority to execute the scheme, substantially, within five years from the date of publication of the declaration under sub-s. (1) of s. 19. If the Authority fails to do so, then the scheme shall lapse and provisions of s. 36 of the BOA Act will become inoperative. The provisions of s.27 which have a direct nexus with the provisions of s.36, provide that the provisions of the Land Acquisition Act, so far as they are applicable to the State Act, shall govern the cases of acquisition otherwise than by agreement. Acquisition stands on a completely distinct footing from the scheme formulated which is the subject matter of execution under the provisions of the BOA Act. {para 18) [494-E-H] G

2.4 On a conjunct reading of the provisions of ss. 27 and 36 of the State Act, it is clear that where a scheme lapses, the acquisition may not. This, of course, will depend ~pon the facts and circumstances of a given case. Where, upon completion of the acquisition H proceedings, the land has vested in the State· .... - .. ___.., --. ~ + . "" --- ..... OFFSHORE HOLDINGS PVT. LTD. v. BANGALORE DEVELOPMENT AUTHORITY 459 Government in terms of s. 16 of the Land Acquisition Act, A the acquisition would not lapse or terminate as a result of lapsing of the scheme u/s 27 of the BOA Act. On vesting, the land stands transferred and vested in the State/Authority free from all encumbrances and suctl status of the property is incapable of being altered by B fiction of law either by the State Act or by the Central Act. · Both these Acts do not contain any provision in terms of which property, once and absolutely, vested in the State can be reverted to the owner on any condition. There is no reversal of the title and possession of the State. c However, this may not be true in cases where acquisition proceedings are still pending and land has not been vested in the Government in terms of s.16 of the Land Acquisition Act. [para 18) [494-H; 495-A-O]

2.5 What is meant by the language of s.27 of the BOA 0 Act, i.e. "provisions of s. 36 shall become inoperative", is .that if the acquisition proceedings are pending and where the scheme has lapsed, rurther proceedings in terms of s.36(3) of the BOA Act, i.e. with reference to proceedings under the Land Acquisition Act shall E become inoperative. Once the land which, upon its acquisition, has vested in the State and thereafter vested in the Authority in terms of s. 36(3); such vesting is incapable of being disturbed except in the case where the Government issues a notification for re-vesting the land F in itself, or a Corporation, or a local Authority in cases where the land is not required by the Authority under the provisions of s.37(3) of the BOA Act. This being the scheme of the acquisition within the framework of the State Act, read with the relevant provisions of the Central G Act, it will not be permissible to bring the concept of 'lapsing of acquisition' as stated in the provisions of s. 11 A of the Land Acquisition Act into Chapter IV of the BOA Act. [para 18] [496-0-G] H ' 460 SUPREME COURT REPORTS [2011] 1 S.C.R. A

2.6 Under the scheme of the BOA Act, there are two situations, amongst others, where the rights of a common person are affected - one relates to levy of betterment tax u/s 20 and property tax u/s 28B of the BOA Act while the other relates to considering the _ B representation made upon drawing up of a notification in terms of s.17(1) of the said Act in regard to acquisition of building or land and the recovery of betterment tax. For determination of the rights and claims in this regard, a complete ... adjudicatory mechanism has been provided c under the State Act itself[ss.18(1 ), 21, 28-B]. There is a provision of appeal [s.62A]. Further, the Government and the Authority are vested with revisional powers [s.63]. All these provisions show that the BOA Act has provided for a complete adjudicatory process for determination of rights and claims. Only in regard to the matters which are not specifically dealt with in the BOA Act, reference to Land Acquisition Act, in terms of s.36, has been made, for example acquisition of land and payment of compensation. This also is a pointer to the BOA Act being 0 E a self-contained Act. [para 19] [495-H; 496-A-G]

2.7 The provisions of the Land Acquisition Act, which provide for timeframe for compliance and the consequences of default thereof, are not applicable to acquisition under the BOA Act. They are ss. 6 and 11A F1 of the Land Acquisition Act. As per s. 11A, if the award is •. not made within a period of two years from the date of declaration u/s 6, the acquisition proceedings will lapse. Similarly, where declaration u/s 6 of this Act is not issued within three years from the date of publication of G notification u/s 4 of the Land Acquisition [such notification being issued after the commencement of the Land Acquistion (Amendment and Validation) Ordinance, 1967 but before the commencement of Central Act 68 of 1984] or within one year where s. 4 notification was H published subsequent to the passing of Central ~ct 68 OFFSHORE HOLDINGS PVT. LTD. v. BANGALORE DEVELOPMENT AUTHORITY 461 of 1984, no such declaration u/s 6 of the Land Acquisition A Act can be issued. [para 17] [492-G-H; 493-A-B] Bondu Ramaswamy v. Bangalore Development Authority 2010 (6) SCR 29 = (2010) 7 sec 129 - relied on.

2.8 One of the apparent and unavoidable 8 consequences of reading the provisions of s.11A of the Central Act into the State Act would be that it is bound to adversely affect the 'development scheme' under the State Act and may even frustrate the same. It is a self defeati ng argument that the Government can always C issue fresh declaration and the acquisition in all cases should lapse in terms of s.11A of the Central Act. The argument also does not stand when tested on the touchstone of the principles, 'test of unworkability', 'test of intention' and 'test of frustration of the object of the D principal legislation'. As per the scheme of the two Acts, the conclusion has to be that they can be construed and applied harmoniously to achieve the object of the State Act and it is not the requirement of the same that provisions of s.11A of the Central Act should be read into E the State Act. The obvious animus, is that the provisions providing time-frames, defaults and consequences thereof, which are likely to have adverse effect on the development schemes, were intended to be excluded. [para 20-22] [496-G-H; 497-A-B; F-H; 498-A-B] F Gimar Traders V. State of Maharashtra, 2011 (3) sec 1 - relied on ... ..._ _,,,. Land Acquisition Officer, City Improvement Trust Board v. H. Narayanaiah 1977 (1) SCR 178 = (1976) 4 SCC 9 - G referred to.

2.9 Thus, it will be clear that the provisions relating to acquisition like passing of an award, payment of compensation and the legal remedies available under the H 462 SUPREME COURT REPORTS [2011) 1 S.C.R. A Central Act would have to be applied to the acquisitions under the State Act but the bar contained in ss. 6 and 11A of the Central Act cannot be made an integral part ot'the State Act as the State Act itself has provided specific time-frames under its various provisions as well as B consequences of default thereto. The scheme, thus, does not admit such incorporation. [para 24) [499-B-C]