Compensation for Acquisition under the Land Acquisition Act : The Law

Justice Raveendran

The Supreme Court in Anjani Molu Dessai Vs. State of Goa has examined the legal position with regard to the payment of compensation for acquisition of land under the Land Acquisition Act. One of the main grievance raised by owners of such lands, is that the compesation provided is a meagre amount as compared to the real market price. The Supreme Court has examined the aforesaid legal proposition and held as under;

13. The legal position is that even where there are several exemplars with reference to similar lands, usually the highest of the exemplars, which is a bona fide transaction, will be considered. Where however there are several sales of similar lands whose prices range in a narrow bandwidth, the average thereof can be taken, as representing the market price. But where the values disclosed in respect of two sales are markedly different, it can only lead to an inference that they are with reference to dissimilar lands or that the lower value sale is on account of under-valuation or other price depressing reasons. Consequently averaging can not be resorted to. We may refer to two decisions of this Court in this behalf. 

13.1 In Sri Rani M. Vijayalakshmanna Rao Bahadur, Ranee of Vuyyur Vs. The Collector of Madras, 1969 (1) MLJ 45, a three Judge Bench of this Court observed that the proper method for evaluation of market value is by taking the highest of the exemplars and not by averaging of different types of sale transactions. This Court held: 

"It seems to us that there is substance in the first contention of Mr. Ram Reddy. After all, when the land is being compulsorily taken away from a person, he is entitled to say that he should be given the highest value which similar land in the locality is shown to have fetched in a bona fide transaction entered into between a willing purchaser and a willing seller near about the time of the acquisition. It is not disputed that the transaction represented by Exhibit R-19 was a few months prior to the notification under section 4, that it was a bona fide transaction and that it was entered into between a willing purchaser and a willing seller. The land comprised in the sale deed is 11 grounds and was sold at Rs.1,961 per ground. The land covered by Exhibit-27 was also sold before the notification, but after the land comprised in Exhibit R-19 was sold. It is true that this land was sold at Rs.1,096/- per ground. This, however, is apparently because of two circumstances. One is that betterment levy at Rs.500 per ground had to be paid by the vendee and the other that the land comprised in it is very much more extensive, that is about 93 grounds or so. Whatever that may be, it seems to us to be only fair that where sale deed, pertaining to different transactions are relied on behalf of the Government, that representing the highest value should be preferred to the rest unless there are strong circumstances justifying a different course. In any case we see no reason why an average of two sale deeds should have been taken in this case." 

13.2 In State of Punjab Vs. Hans Raj (1994) 5 SCC 734, this court held: 

"Having given our anxious consideration to the respective contentions, we are of the considered view that the learned single Judge of the High Court committed a grave error in working out average price paid under the sale transactions to determine the market value of the acquired land on that basis. As the method of averaging the prices fetched by sales of different lands of different kinds at different times, for fixing the market value of the acquired land, if followed, could bring about a figure of price which may not at all be regarded as the price to be fetched by sale of acquired land. One should not have, ordinarily recourse to such method. It is well settled that genuine and bona fide sale transactions in respect of the land under acquisition or in its absence the bona fide sale transactions proximate to the point of acquisition of the lands situated in the neighbourhood of the acquired lands possessing similar value or utility taken place between a willing vendee and the willing vendor which could be expected to reflect the true value, as agreed between reasonable prudent persons acting in the normal market conditions are the real basis to determine the market value."

Exemption from Personal Appearance of Accused : The Law

Justice D.K. Jain

The Supreme Court, in a recent decision in TGN Kumar vs State Of Kerala & Ors., has examined the provisions of Section 205 of the Code of Criminal Procedure, relating to the dispensation of personal appearance of an accused before a Criminal Court. The Supreme Court held as under;

"One of the questions which arises for consideration in this special leave petition is as to whether the High court in exercise of its jurisdiction under Sections 482 and 483 of the Code of the Criminal Procedure and/or under Article 227 of the Constitution of India could issue guidelines directing all courts taking cognizance of offences under section 138 of the Negotiable Instruments Act inter alia to invoke the discretion under Section 205 of the Code of Criminal Procedure and only with a further direction that summons under Section 205 shall be issued at the first instance. Keeping in view importance of the question involved as also the various decisions of this Court upon which the learned Judge of the High Court has placed reliance, in our opinion, we think that this is a matter which should be heard by a larger Bench. It is directed accordingly." This is how the present appeal has been placed before this Bench.

5. Having heard learned counsel for the parties, we are convinced that impugned order is unsustainable.

6. Section 205 of the Code, which clothes the Magistrate with the to dispense with the personal appearance of the accused, reads as follows:

"205. Magistrate may dispense with personal attendance of accused.--(1) Whenever a Magistrate issues a summons, he may, if he sees reason so to do, dispense with the personal attendance of' the accused and permit him to appear by his pleader.

(2) But the Magistrate inquiring into or trying the case may, in his discretion, at any stage of' the proceedings, direct the personal attendance of the accused, and, if necessary, enforce such attendance in the manner hereinbefore provided."

7. The Section confers a discretion on the court to exempt an accused personal appearance till such time his appearance is considered by court to be not necessary during the trial. It is manifest from a reading of the provision that while considering an application Section 205 of the Code, the Magistrate has to bear in mind the nature the case as also the conduct of the person summoned. He shall whether any useful purpose would be served by requiring the attendance of the accused or whether the progress of the trial is likely to be hampered on account of his absence. (See: S.V. Muzumdar & Ors. Vs. Gujarat State Fertilizer Co. Ltd. & Anr.) . Therefore, the satisfaction whether or not an accused deserves to be exempted from personal attendance has to be of the Magistrate, who is the master of the court in so far as the progress of the trial is concerned and none else.

8. In Bhaskar Industries Ltd. (supra), this Court had laid down the following guidelines, which are to be borne in mind while dealing with an application seeking dispensation with the personal appearance of an accused in a case under Section 138 of the N.I. Act:

"19. ...it is within the powers of a Magistrate and in his judicial discretion to dispense with the personal appearance of an accused either throughout or at any particular stage of such proceedings in a summons case, if the Magistrate finds that insistence of his personal presence would itself inflict enormous suffering or tribulations on him, and the comparative advantage would be less. Such discretion need be exercised only in rare instances where due to the far distance at which the accused resides or carries on business or on account of any physical or other good reasons the Magistrate feels that dispensing with the personal attendance of the accused would only be in the interests of justice. However, the Magistrate who grants such benefit to the accused must take the precautions enumerated above, as a matter of course."

We respectfully concur with the above guidelines and while re-affirming the same, we would add that the order of the Magistrate should be such which does not result in unnecessary harassment to the accused and at the same time does not cause any prejudice to the complainant. The Court must ensure that the exemption from personal appearance granted to an accused is not abused to delay the trial.

9. In light of the afore-extracted legal principles, the impugned order is clearly erroneous in as much as the discretion of the Magistrate under Section 205 of the Code cannot be circumscribed by laying down any general directions in that behalf. In Manoj Narain Agrawal Vs. Shashi Agrawal & Ors., this Court, while observing that the High Court cannot lay down directions for the exercise of discretion by the Magistrate under Section 205 of the Code, had echoed the following views:

"Similarly, the High Court should not have, for all intent and purport, issued the direction for grant of exemption from personal appearance. Such a matter undoubtedly shall be left for the consideration before the learned Magistrate. We are sure that the Magistrate would exercise his jurisdiction in a fair and judicious manner."

10. It is equally trite that the inherent powers of the High Court under Section 482 of the Code have to be exercised sparingly with circumspection, and in rare cases to correct patent illegalities or to prevent miscarriage of justice. In Madhu Limaye Vs. The State of Maharashtra, a Bench of three learned Judges of this Court had observed that:

"...the following principles may be noticed in relation to the exercise of the inherent power of the High Court....: -

(1) That the power is not to be resorted to if there is a specific provision in the Code for the redress of the grievance of the aggrieved party;

(2) That it should be exercised very sparingly to prevent abuse of process of any Court or otherwise to secure the ends of justice;

(3) That it should not be exercised as against the express bar of law engrafted in any other provision of the Code."

11. Similarly, while it is true that the power of superintendence conferred on the High Court under Article 227 of the Constitution of India is both administrative and judicial, but such power is to be exercised sparingly and only in appropriate cases in order to keep the subordinate courts within the bounds of their authority. In any event, the power of superintendence cannot be exercised to influence the subordinate judiciary to pass any order or judgment in a particular manner. In Jasbir Singh Vs. State of Punjab, this Court observed that:

"So, even while invoking the provisions of Article 227 of the Constitution, it is provided that the High Court would exercise such powers most sparingly and only in appropriate cases in order to keep the subordinate courts within the bounds of their authority. The power of superintendence exercised over the subordinate courts and tribunals does not imply that the High Court can intervene in the judicial functions of the lower judiciary. The independence of the subordinate courts in the discharge of their judicial functions is of paramount importance, just as the independence of the superior courts in the discharge of their judicial functions. It is the members of the subordinate judiciary who directly interact with the parties in the course of proceedings of the case and therefore, it is no less important that their independence should be protected effectively to the satisfaction of the litigants." (See also: Trimbak Gangadhar Telang & Anr. Vs. Ramchandra Ganesh Bhide & Ors.; Mohd. Yunus Vs. Mohd. Mustaqim & Ors. and State, New Delhi Vs. Navjot Sandhu & Ors.)

12. As regards direction (iv) supra to accept and consider the written statement made by the accused, in our opinion, it is again not in accord with the language of Section 313 of the Code as also the dictum laid down by this Court in Basavaraj R. Patil & Ors. Vs. State of Karnataka & Ors. Section 313 of the Code deals with the personal examination of the accused, and provides that:

"313. Power to examine the accused.--(1) In every inquiry or trial, for the purpose of enabling the accused personally to explain any circumstances appearing in the evidence against him, the Court--

(a) may at any stage, without previously warning the accused, put such questions to him as the Court considers necessary;

(b) shall, after the witnesses for the prosecution have been examined and before he is called on for his defence, question him generally on the case:

Provided that in a summons-case, where the Court has dispensed with the personal attendance of the accused, it may also dispense with his examination under clause (b). ............................................................................" (emphasis supplied by us)

13.On the plain language of Section 313, it is evident that in a summons case, when the personal appearance of the accused has been dispensed with under Section 205 of the Code, a discretion is vested in the Magistrate to dispense with the rigour of personal examination of the accused under Section 313 of the Code as well.

14. In Basavaraj R. Patil & Ors. (supra) while advocating a pragmatic and humanistic approach in less serious offences, Thomas, J. speaking for the majority in a Bench of three learned Judges, explained the scope of clause (b) to Section 313(1) of the Code as follows :

"The word "shall" in clause (b) to Section 313(1) of the Code is to be interpreted as obligatory on the court and it should be complied with when it is for the benefit of the accused. But if it works to his great prejudice and disadvantage the court should, in appropriate cases, e.g., if the accused satisfies the court that he is unable to reach the venue of the court, except by bearing huge expenditure or that he is unable to travel the long journey due to physical incapacity or some such other hardship, relieve him of such hardship and at the same time adopt a measure to comply with the requirements in Section 313 of the Code in a substantial manner. How could this be achieved?

If the accused (who is already exempted from personally appearing in the court) makes an application to the court praying that he may be allowed to answer the questions without making his physical presence in court on account of justifying exigency the court can pass appropriate orders thereon, provided such application is accompanied by an affidavit sworn to by the accused himself containing the following matters:

(a) A narration of facts to satisfy the court of his real difficulties to be physically present in court for giving such answers.

(b) An assurance that no prejudice would be caused to him, in any manner, by dispensing with his personal presence during such questioning.

(c) An undertaking that he would not raise any grievance on that score at any stage of the case."

15. It is manifest from the afore-extracted passage that dispensation with the personal examination of an accused in terms of the said provision is within the trial court's discretion, to be exercised keeping in view certain parameters, enumerated therein and not as a matter of course.

16. It is true that in direction (vii) supra, the learned Judge has clarified that the stipulations in the preceding paragraphs are not intended to fetter the discretion of the court to follow any different procedure, if there be compelling need but the requirement of recording `specific reasons' by the Magistrate for deviating from the directions given in the order, as stipulated in the same paragraph, in our view, is by itself tantamount to putting fetters on the jurisdiction of the Magistrate. This is not warranted in law.

The Doctrine of 'Stare Decisis' : Supreme Court Explains

Justice D.K. Jain

The Supreme Court, speaking through Justice D.K. Jain and H.L. Dattu, in Shanker Raju vs Union of India, has explained the legal concept of Stare Decisis. The doctrine pertains to the concept of being bound by one's earlier decision. The concept, as applicable in India, has been explained by the Supreme Court as under;

The Doctrine of Stare Decisis

9) It is a settled principle of law that a judgment, which has held the field for a long time, should not be unsettled. The doctrine of stare decisis is expressed in the maxim "stare decisis et non quieta movere", which means "to stand by decisions and not to disturb what is settled." Lord Coke aptly described this in his classic English version as "those things which have been so often adjudged ought to rest in peace." The underlying logic of this doctrine is to maintain consistency and avoid uncertainty. The guiding philosophy is that a view which has held the field for a long time should not be disturbed only because another view is possible. This has been aptly pointed out by Chandrachud, C.J. in Waman Rao v. Union of India, (1981) 2 SCC 362 at pg. 392 thus:

"40. ... for the application of the rule of stare decisis, it is not necessary that the earlier decision or decisions of longstanding should have considered and either accepted or rejected the particular argument which is advanced in the case on hand. Were it so, the previous decisions could more easily be treated as binding by applying the law of precedent and it will be unnecessary to take resort to the principle of stare decisis. It is, therefore, sufficient for invoking the rule of stare decisis that a certain decision was arrived at on a question which arose or was argued, no matter on what reason the decision rests or what is the basis of the decision. In other words, for the purpose of applying the rule of stare decisis, it is unnecessary to enquire or determine as to what was the rationale of the earlier decision which is said to operate as stare decisis."

10) In Manganese Ore (India) Ltd. v. Regional Asstt. CST, (1976) 4 SCC 124, at page 127, it was opined that the doctrine of stare decisis is a very valuable principle of precedent which cannot be departed from unless there are extraordinary or special reasons to do so. 11) In Ganga Sugar Corpn. v. State of U.P., (1980) 1 SCC 223 at page 233, this Court cautioned that, "the Judgments of this Court are decisional between litigants but declaratory for the nation." This Court further observed:

"28. ... Enlightened litigative policy in the country must accept as final the pronouncements of this Court... unless the subject be of such fundamental importance to national life or the reasoning is so plainly erroneous in the light of later thought that it is wiser to be ultimately right rather than to be consistently wrong. Stare decisis is not a ritual of convenience but a rule with limited exceptions."

12) In Union of India v. Raghubir Singh, (1989) 2 SCC 754, at page 766, this Court has enunciated the importance of doctrine of binding precedent in the development of jurisprudence of law: "8. Taking note of the hierarchical character of the judicial system in India, it is of paramount importance that the law declared by this Court should be certain, clear and consistent. It is commonly known that most decisions of the courts are of significance not merely because they constitute an adjudication on the rights of the parties and resolve the dispute between them, but also because in doing so they embody a declaration of law operating as a binding principle in future cases. In this latter aspect lies their particular value in developing the jurisprudence of the law.

9. The doctrine of binding precedent has the merit of promoting a certainty and consistency in judicial decisions, and enables an organic development of the law, besides providing assurance to the individual as to the consequence of transactions forming part of his daily affairs. And, therefore, the need for a clear and consistent enunciation of legal principle in the decisions of a court."

13) In Krishena Kumar v. Union of India, (1990) 4 SCC 207, at page 233, this Court has explained the meaning and importance of sparing application of the doctrine of Stare Decisis: "33. Stare decisis et non quieta movere. To adhere to precedent and not to unsettle things which are settled. But it applies to litigated facts and necessarily decided questions. Apart from Article 141 of the Constitution of India, the policy of courts is to stand by precedent and not to disturb settled point. When court has once laid down a principle of law as applicable to certain state of facts, it will adhere to that principle, and apply it to all future cases where facts are substantially the same. A deliberate and solemn decision of court made after argument on question of law fairly arising in the case, and necessary to its determination, is an authority, or binding precedent in the same court, or in other courts of equal or lower rank in subsequent cases where the very point is again in controversy unless there are occasions when departure is rendered necessary to vindicate plain, obvious principles of law and remedy continued injustice. It should be invariably applied and should not ordinarily be departed from where decision is of long standing and rights have been acquired under it, unless considerations of public policy demand it."

14) In Union of India & Anr. v. Paras Laminates (P) Ltd, (1990) 4 SCC 453 at pg. 457, this Court observed as under :- "9. It is true that a bench of two members must not lightly disregard the decision of another bench of the same Tribunal on an identical question. This is particularly true when the earlier decision is rendered by a larger bench. The rationale of this rule is the need for continuity, certainty and predictability in the administration of justice. Persons affected by decisions of tribunals or courts have a right to expect that those exercising judicial functions will follow the reason or ground of the judicial decision in the earlier cases on identical matters".

It has been opined that in the absence of a strict rule of precedent, litigants would take every case to the highest court, in spite of a ruling to the contrary, in the hope that the decision may be overruled.

15) In Hari Singh v. State of Haryana, (1993) 3 SCC 114, at page 120, this Court stated the importance of consistent opinions in achieving harmony in Judicial System:

"10. It is true that in the system of justice which is being administered by the courts, one of the basic principles which has to be kept in view, is that courts of coordinate jurisdiction, should have consistent opinions in respect of an identical set of facts or on a question of law. If courts express different opinions on the identical sets of facts or question of law while exercising the same jurisdiction, then instead of achieving harmony in the judicial system, it will lead to judicial anarchy."

16) In Tiverton Estates Ltd. v. Wearwell Ltd., (1975) Ch 146 at page 371, Sorman L. J., while not agreeing with the view of Lord Denning, M.R. about desirability of not accepting previous decisions, said as follows:

"I decline to accept his lead only because I think it damaging to the law to the long term--though it would undoubtedly do justice in the present case. To some it will appear that justice is being denied by a timid, conservative adherence to judicial precedent. They would be wrong. Consistency is necessary to certainty--one of great objectives of law." 

17) The second observation we wish to make is, the doctrine of binding precedent has the merit of promoting certainty and consistency in judicial decisions. The pronouncement of law by a larger Bench of the this Court is binding on a Division Bench of this court, especially where the particular determination by this Court not only disposes of the case, but also decides a principle of law. We further add that it would be inappropriate to reagitate the very issue or a particular provision, which this Court had already considered and upheld.

Withdrawal from Acquisition under S. 48 of the Land Acquisition Act : The Law

Justice B.N. Aggarwal

The Supreme Court in Shanti Sports Club & Anr. vs Union Of India & Ors., has examined the law relating to the powers of the state to withdraw from acquisition of land notified for acquisition under S. 4 and 6 of the Land Acquisition Act. The Supreme Court held as under;

28. The requirement of issuing a notification for exercise of power under Section 48(1) of the Act to withdraw from the acquisition of the land can also be inferred from the judgments of this Court in Municipal Committee, Bhatinda v. Land Acquisition Collector and others (1993) 3 SCC 24 (para 8), U.P. State Sugar Corporation Ltd. v. State of U.P. and others (1995) Supp 3 SCC 538 (para 3), State of Maharashtra and another v. Umashankar Rajabhau and others (1996) 1 SCC 299 (para 3) and State of T.N. and others v. L. Krishnan and others (1996) 7 SCC 450 (para 7). In Larsen &Toubro Ltd. v. State of Gujarat and others (1998) 4 SCC 387, the Court considered the question whether the power under Section 48(1) of the Act can be exercised by the Government without notifying the factum of withdrawal to the beneficiary of the acquisition. It was argued that in contrast to Sections 4 and 6, Section 48(1) of the Act does not contemplate issue of any notification and withdrawal from the acquisition can be done by an order simpliciter. It was further argued that power under Section 21 of the General Clauses Act can be exercised for withdrawing notifications issued under Sections 4 and 6. While rejecting the argument, the Court observed:

"..... When Sections 4 and 6 notifications are issued, much has been done towards the acquisition process and that process cannot be reversed merely by rescinding those notifications. Rather it is Section 48 under which, after withdrawal from acquisition is made, compensation due for any damage suffered by the owner during the course of acquisition proceedings is determined and given to him. It is, therefore, implicit that withdrawal from acquisition has to be notified.

31. Principles of law are, therefore, well settled. A notification in the Official Gazette is required to be issued if the State Government decides to withdraw from the acquisition under Section 48 of the Act of any land of which possession has not been taken. An owner need not be given any notice of the intention of the State Government to withdraw from the acquisition and the State Government is at liberty to do so. Rights of the owner are well protected by sub-section (2) of Section 48 of the Act and if he suffered any damage in consequence of acquisition proceedings, he is to be compensated and sub- section (3) of Section 48 provides as to how compensation is to be determined. There is, therefore, no difficulty when it is the owner whose land is withdrawn from acquisition is concerned. However, in the case of a company, opportunity has to be given to it to show cause against any order which the State Government proposes to make withdrawing from the acquisition. Reasons for this are not far to seek. After notification under Section 4 is issued, when it appears to the State Government that the land in any locality is needed for a company, any person interested in such land which has been notified can file objections under Section 5-A(1) of the Act. Such objections are to be made to the Collector in writing and who after giving the objector an opportunity of being heard and after hearing of such objections and after making such further enquiry, if any, as the Collector thinks necessary, is to make a report to the Government for its decision. Then the decision of the State Government on the objections is final. Before the applicability of other provisions in the process acquisition, in the case of a company, previous consent of the State Government is required under Section 39 of the Act nor (sic) unless the company shall have executed the agreement as provided in Section 41 of the Act. Before giving such consent, Section 40 contemplates a previous enquiry. Then compliance with Rules 3 and 4 of the Land Acquisition (Company) Rules, 1963 is mandatorily required. After the stage of Sections 40 and 41 is reached, the agreement so entered into by the company with the State Government is to be published in the Official Gazette. This is Section 42 of the Act which provides that the agreement on its publication would have the same effect as if it had formed part of the Act. After having done all this, the State Government cannot unilaterally and without notice to the company withdraw from acquisition. Opportunity has to be given to the company to show cause against the proposed action of the State Government to withdraw from acquisition. A declaration under Section 6 of the Act is made by notification only after formalities under Part VII of the Act which contains Sections 39 to 42 have been complied and the report of the Collector under Section 5-A(2) of the Act is before the State Government who consents to acquire the land on its satisfaction that it is needed for the company. A valuable right, thus, accrues to the company to oppose the proposed decision of the State Government withdrawing from acquisition. The State Government may have sound reasons to withdraw from acquisition but those must be made known to the company which may have equally sound reasons or perhaps more, which might persuade the State Government to reverse its decision withdrawing from acquisition. In this view of the matter it has to be held that Yadi (memo) dated 11-4-1991 and Yadi (memo) dated 3-5-1991 were issued without notice to the appellant (L&T Ltd.) and are, thus, not legal." (emphasis added)

29. The issue deserves to be considered from another angle. All executive actions of the Government of India and the Government of a State are required to be taken in the name of the President or the Governor of the concerned State, as the case may be [Articles 77(1) and 166(1)]. Orders and other instruments made and executed in the name of the President or the Governor of a State, as the case may be, are required to be authenticated in such manner as may be specified in rules to be made by the President or the Governor, as the case may be [Articles 77(2) and 166(2)]. Article 77(3) lays down that the President shall make rules for more convenient transaction of the business of the Government of India, and for the allocation among Ministers of the said business. Likewise, Article 166(3) lays down that the Governor shall make rules for the more convenient transaction of the business of the Government of the State, and for the allocation among Ministers of the said business insofar as it is not business with respect to which the Governor is by or under this Constitution required to act in his discretion. This means that unless an order is expressed in the name of the President or the Governor and is authenticated in the manner prescribed by the rules, the same cannot be treated as an order on behalf of the Government. A noting recorded in the file is merely a noting simpliciter and nothing more. It merely represents expression of opinion by the particular individual. By no stretch of imagination, such noting can be treated as a decision of the Government. Even if the competent authority records its opinion in the file on the merits of the matter under consideration, the same cannot be termed as a decision of the Government unless it is sanctified and acted upon by issuing an order in accordance with Article 77(1) and (2) or Article 166(1) and (2). The noting in the file or even a decision gets culminated into an order affecting right of the parties only when it is expressed in the name of the President or the Governor, as the case may be, and authenticated in the manner provided in Article 77(2) or Article 166(2). A noting or even a decision recorded in the file can always be reviewed/reversed/overruled or overturned and the court cannot take cognizance of the earlier noting or decision for exercise of the power of judicial review.

30. In State of Punjab v. Sodhi Sukhdev Singh AIR 1961 SC 493, this Court considered the question whether a provisional decision taken by the Council of Ministers to reinstate an employee could be made basis for filing an action for issue of a mandamus for reinstatement and held:

".......... We are unable to understand this argument. Even if the Council of Ministers had provisionally decided to reinstate the respondent that would not prevent Council from reconsidering the matter and coming to a contrary conclusion later on, until a final decision is reached by them and is communicated to the Rajpramukh in the form of advice and acted upon by him by issuing an order in that behalf to the respondent."

31. A somewhat similar question was considered by the Constitution Bench in Bachhittar Singh v. The State of Punjab (1962) Supp. 3 SCR 713, in the backdrop of the argument that once the Revenue Minister of PEPSU had recorded a note in the file that the punishment imposed on the respondent be reduced from dismissal to that of reversion, the same could not be changed/reviewed/overruled by the Chief Minister. This Court proceeded on the assumption that the note recorded by the Revenue Minister of PEPSU in the file was an order, referred to the provisions of Article 166 of the Constitution and held:

"Merely writing something on the file does not amount to an order. Before something amounts to an order of the State Government two things are necessary. The order has to be expressed in the name of the Governor as required by clause (1) of Art.166 and then it has to be communicated. As already indicated, no formal order modifying decision of the Revenue Secretary was ever made. Until such an order is drawn up the State Government cannot, in our opinion, be regarded as bound by what was stated in the file. As along as the matter rested with him the Revenue Minister could well score out his remarks or minutes on the file and write fresh ones.

The business of State is a complicated one and necessarily to be conducted through the agency of a large number of officials and authorities. The constitution, therefore, requires and so did the Rules of Business framed by the Rajpramukh of PEPSU provide, that the action must be taken by the authority concerned in the name of the Rajpramukh. It is not till this formality is observed that the action can be regarded as that of the State or here, by the Rajpramukh. We may further observe that, constitutionally speaking, the Minister is no more than an adviser and that the head of the State, the Governor or Rajpramukh (Till the abolition of that office by the Amendment of the Constitution in 1956), is to act with the aid and advice of his Council of Ministers. Therefore, until such advice is accepted by the Governor whatever the Minister or the Council of Ministers may say in regard to a particular matter does not become the action of the State until the advice of the Council of Ministers is accepted or deemed to be accepted by the Head of the State. Indeed, it is possible that after expressing one opinion about a particular matter at a particular stage a Minister or the Council of Ministers may express quite a different opinion, one which may be completely opposed to the earlier opinion. Which of them can be regarded as the 'order' of the State Government ? Therefore to make the opinion amount to a decision of the Government it must be communicated to the person concerned. In this connection we may quote the following from the judgment of this Court in the State of Punjab v. Sodhi Sukhdev Singh. "Mr. Gopal Singh attempted to argue that before the final order was passed the Council of Ministers had decided to accept the respondent's representation and to reinstate him, and that, according to him, the respondent seeks to prove by calling the two original orders. We are unable to understand this argument.

Even if the Council of Ministers had decided to reinstate the respondent that would prevent the Council from reconsidering the matter and coming to a contrary conclusion later on, until final decision is reached by them and is communicated to the Rajpramukh in the form of advice and upon by him by issuing an order in that behalf to the respondent."

Thus it is of the essence that the order has to communicated to the person who would be affected by that order before the State and that person can be bound by that order. For, until the order is communicated to the person affected by it, it would be open to the Council of Ministers to consider the matter over and over again and, therefore, till its communication the order cannot be regarded as anything more than provisional in character. We are, therefore, of the opinion that the remarks or the order of the Revenue Minister, PEPSU are of no avail to the appellant."

[emphasis added]

32. In State of Bihar and others v. Kripalu Shankar and others (1987) 3 SCC 34, a two-Judge Bench while considering the question whether notings recorded in the file would constitute civil or criminal contempt within the meaning of Section 2(b) and (c) of the Contempt of Courts Act observed as under:-

"14. Now, the functioning of Government in a State is governed by Article 166 of the Constitution, which lays down that there shall be a council of ministers with the Chief Minister at the head, to aid and advise the Governor in the exercise of his functions except where he required to exercise his functions under the Constitution, in his discretion. Article 166 provides for the conduct of Government business. It is useful to quote this article: 166 (1) All executive action of the government of State shall be expressed to be taken in the name the Governor.

(2) Orders and other instruments made and executed in the name of the Governor shall be authenticated such manner as may be specified in rules to be by the Governor, and the validity of an order instrument which is so authenticated shall not called in question on the ground that it is not order or instrument made or executed by the Governor. (3) The Governor shall make rules for the convenient transaction of the business of government of the State, and for the allocation among Ministers of the said business insofar as it is business with respect to which the Governor is by or under this Constitution required to act in discretion.

15. Article 166(1) requires that all executive action of the State Government shall be expressed to be taken in the name of the Governor. This clause relates to cases where the executive action has to be expressed in the shape of a formal order or notification. It prescribes the mode in which an executive action has to be expressed. Noting by an official in the departmental file will not, therefore, come within this article nor even noting by a Minister. Every executive decision need not be as laid down under Article 166(1) but when it takes the form of an order it has to comply with Article 166(1). Article 166(2) states that orders and other instruments made and executed under Article 166(1), shall be authenticated in the manner prescribed. While clause (1) relates to the mode expression, clause (2) lays down the manner in which the order is to be authenticated and clause (3) relates to the making of the rules by the Governor for the convenient transaction of the business of the Government. A study of this article, therefore, makes it clear that the notings in a file get culminated into an affecting right of parties only when it reaches the head of the department and is expressed in the name of the Governor, authenticated in the manner provided in Article 166(2)."

33. In Rajasthan Housing Board v. Shri Kishan (1993) 2 SCC 84, this Court made a detailed reference to the records and affidavit filed on behalf of the Rajasthan Housing Board and held: "From the above material, it is clear that there was no final decision at any time to de-notify the said lands. A tentative decision was no doubt taken in February 1990 but before it could be implemented the Government thought it necessary to ascertain in views of the Housing Board and to find out as to what the Board had done upon the land, what structures it had raised and what amount it had spent so that the Board could be compensated while delivering the possession back to the Housing Society. Before this could be done there was a change in the Government and the said tentative decision was reversed. In this view of the matter, it is not necessary for us to go into the question whether there was a communication of the `decision' of the Government to the petitioner. The communication must be of a final decision and not of a provisional or tentative decision."

34. The issue was recently considered in Sethi Auto Service Station and another v. Delhi Development Authority and others (2009) 1 SCC 180. In that case, the appellant had claimed relocation of two petrol pumps which had become non-profitable on account of construction of 8 lane express highway between Delhi and Gurgaon. The appellants relied on the notings recorded by the technical committee headed by the Vice Chairman, DDA. It was urged that the technical committee had recommended relocation of the petrol pumps, it was not open to DDA to do a volte face and reject the representation of the appellants. On behalf of the respondents, it was urged that mere notings and proposal recorded in the files of DDA did not create any right in favour of the appellants and the final decision taken by DDA against relocation of petrol pumps was consistent with the policy in vogue. This Court approved the High Court's refusal to interfere with DDA's decision and observed: "It is trite to state that notings in a departmental file do not have the sanction of law to be an effective order. A noting by an officer is an expression of his viewpoint on the subject. It is no more than an opinion by officer for internal use and consideration of the other officials of the department and for the benefit of the final decision-making authority. Needless to add that internal notings are not meant for outside exposure. Notings in the file culminate into an executable order, affecting the rights of the parties, only when it reaches the final decision-making authority in the department, gets his approval and the final order is communicated to the person concerned."

35. In C.W.P. No.325/1982 - Ram Phal v. Union of India, which was decided by the Full Bench of the High Court along with other cases, vide Roshanara Begum v. Union of India, an application was moved by the petitioners with the prayer that the acquisition proceedings may be quashed because the Central Government has issued an order under Section 48(1) of the Act for withdrawal of the acquisition proceedings in respect of the land which was subject matter of the writ petition. On behalf of the Central Government, it was urged that no order has been made by the Central Government for withdrawing from acquisition of the land in question and communication regarding withdrawal was sent due to misreading of orders made in the file. Counsel representing the Union of India went to the extent of arguing that if the court was to infer that any such order has been made by the Central Government, then the same be treated as non est and declared as illegal and void because the land was being acquired for planned development of Delhi. It was argued that before an order under Section 48 could come into play, the same is required to be published in the official gazette in the same manner in which notification under Section 4 and declaration under Section 6, are published. The Full Bench adverted to Section 48(1) of the Act and observed:

"Section 48 of the Act lays down that Government shall be at liberty to withdraw from the acquisition of any land of which possession has not been taken. The original record in which the Minister concerned had made the order was produced before us which we have perused and as a matter of fact, the learned counsel for the petitioner has placed on record the photocopies of the notings on which the order of the Minister has been accorded. It is evident that if this Court is to come to the conclusion on reading the said record that in fact no order has been made by the Minister concerned which amounts to withdrawing from acquisition, mere communication of the misconstrued order by the officials would not have the effect of an order of the Government withdrawing from the acquisition."

36. The Full Bench then examined the notings in the file, referred to Section 21 of the General Clauses Act, 1897 and concluded:

"157. Section 48 by itself does not require publication of such an order in the Official Gazette. As a matter of fact, there is no repugnancy between the provisions of Section 48 of the Act as read with Section 21 of the General Clauses Act. The purpose of issuance of publication of notifications and declarations under Sections 4 and 6 of the Act in Official Gazette are that public at large should become aware of the factum that the land so notified is to be acquired for public purpose so that people at large should not suffer any monetary loss or any other inconveniences in entering into any deals in respect of such land, subject-matter of acquisition. As an analogy of the purpose enshrined in notification issued under Section 4 and declaration issued under Section 6 for their publication in Official Gazette is also, in our view, linked to the order which is made under Section 48 of the Act for withdrawing from such acquisition and unless the same is also published in the manner as the original notifications, the said object could not be achieved i.e. of giving public notice to the public at large."

37. As a result of the above discussion, we hold that the noting recorded in the official files by the officers of the Government at different levels and even the Ministers do not become decision of the Government unless the same is sanctified and acted upon by issuing an order in the name of the President or Governor, as the case may, authenticated in the manner provided in Articles 77(2) and 166(2) and is communicated to the affected persons. The notings and/or decisions recorded in the file do not confer any right or adversely affect the right of any person and the same can neither be challenged in a court nor made basis for seeking relief. Even if the competent authority records noting in the file, which indicates that some decision has been taken by the concerned authority, the same can always be reviewed by the same authority or reversed or over-turned or overruled by higher functionary/authority in the Government.

38. Reverting to the case in hand, we find that representation made on behalf of appellant No.1 was examined by different functionaries of the Government and DDA. On 8.6.1999, the then Minister for Urban Development recorded a note in the file that extensive construction has taken place and this must have been possible with the cooperation of the concerned officers and opined that no demolition can or will be ordered as per the policy. He then recorded that suitable terms for regularization be settled by negotiations and left the matter there for consideration by his successor. That noting was never translated into an order nor the same was published in the official gazette in the form of a notification. It was not even communicated to the appellants or DDA. The reason for this is not far to seek. The Minister had himself left the matter for consideration and decision by his successor. The latter finally decided on 14.7.1999 that the appellants request for de-notification of the land cannot be accepted because the development was carried out after its acquisition and also because the land is required for a public purpose, i.e, Vasant Kunj Residential Project, which was held up due to prolonged litigation. This being the position, the appellants cannot rely upon the note recorded by the then Minister on 8.6.1999 for pleading before the Court that the Government had taken decision to withdraw from the acquisition of land in question in terms of Section 48(1) of the Act.

39. Before leaving this part of the discussion, we consider it necessary to observe that there have been several cases of exercise of power under Section 48(1) of the Act for extraneous considerations defeating the very purpose of acquisition. Two such instances have been considered by this Court in Chandra Bansi Singh v. State of Bihar (1984) 4 SCC 316 and Rajasthan Housing Board v. Sri Kishan (supra). The facts of Chandra Bansi Singh's case were that on 19.8.1974, the Government of Bihar issued notification under Section 4 for acquisition of 1034.94 acres of land in village Digha for the purpose of construction of houses by the Bihar State Housing Board. After consideration of objections, declaration under Section 6 was issued and published on 20.2.1976. On 8.11.1976, a representation was made by one Mr. Ram Avtar Shastri, Member of Parliament for withdrawing the acquisition proceedings. The same was rejected in December, 1976. However, before compensation could be disbursed to the land owners, general elections were announced and, therefore, the matter was deferred and put in cold storage. On 24.5.1980, 4.03 acres land belonging to Pandey families was released from acquisition. In the same year, a writ petition was filed in the High Court challenging release of land in favour of Pandey families but the same was withdrawn. In May 1981, another writ petition was filed on the same subject and it was pleaded that release of land in favour of Pandey families is violative of Article 14 of the Constitution. The State Government supported the release of land in favour of Pandey families by asserting that they had put up buildings with boundary walls in the entire area covered by 4.03 acres and that it would have been difficult for government to demolish the construction. This was controverted by the petitioner, who produced several photographs to show that no huge buildings or houses were constructed and only small hutment had been put up on the land. After considering the entire record, this Court ruled that release of land in favour of Pandey families was pure and simple act of favouritism without there being any legal or constitutional justification for the same and declared the action of the State Government to be violative of Article 14 of the Constitution. The Court also declared that the entire acquisition will be deemed to be valid and the land released to Pandey families would form part of the acquisition initiated vide notification dated 19.8.1974.

40. The facts of Sri Kishan's case were that 2570 bighas of land (approximately equal to 1580 crores) was acquired for the benefit of the Rajasthan Housing Board by publication of notification under Section 4(1) read with Section 17(4) of the Act. The learned Single Judge of the High Court dismissed the writ petitions involving challenge to the acquisition proceedings. On appeals filed by the land owners, Judges constituting the Division Bench expressed divergent opinions. Thereupon, the matter was referred to the larger Bench. By a majority judgment, the larger Bench quashed the notification issued under Section 17(4) and declaration issued under Section 6. During the pendency of appeals before this Court, a writ petition was filed by New Pink City Grah Nirman Sahkari Sangh. Therein it was pleaded that by virtue of the decision of the Minister-in-charge, Urban Development Department and the Chief Minister, the State Government must be deemed to have withdrawn from the acquisition within the meaning of Section 48(1) of the Act. This Court noted that the society, which claims to have purchased 525 bighas of land from khatedars, represented the Government to de- notify the land. The then Minister-in-charge, Urban Development Department recorded a decision in the file on July 20, 1984 that the lands be released, but his decision was overruled by the Chief Minister. After about five years, the society again represented for de-notification of the land. The Minister for Urban Development made recommendation in favour of the society. This time, the Chief Minister agreed with the Minister by observing that the land of the society was regularised according to the decision of the Cabinet. Thereafter, Deputy Secretary, Urban Development and Housing Department wrote a letter to the Secretary of the Housing Board that the Government has decided to release the land of the society. A copy of the letter was marked to the society. During the pendency of writ petition before this Court, an additional affidavit of the Secretary, Rajasthan Housing Board was filed with a categorical assertion that at no point of time any notification was issued withdrawing from the acquisition and the Beri Commission, which was constituted to look into the illegalities and irregularities committed by functionaries and officials of the previous Government, recorded a categorical finding that the decision to de-acquire the land of the petitioner - society was in contravention of the earlier decision of the Cabinet and was also contrary to law and against public interest. This Court held that the notings recorded by the Minister and Chief Minister for release of land in favour of the society, were totally unjustified.