Bhajan Lal and Others vs State of Haryana and Others

Sukhdev Singh Kang, J.—The petitioners in this writ petition under Arts. 226 and 227 of the Constitution of India seek the issuance of a writ of mandamus directing respondent No. 3. Union of India to appoint an Arbitrator to assess the market value of their land in accordance with law. It has been filed in the following circumstances :--

The petitioners are right holders of village Saran, Tehsil Ballabgarh, District Faridabad, in the State of Haryana. The petitioners'' land was acquired by the Central Government under sub-section (2) of S. 36 of the Defence of India Act, 1962 (''the Act'', for short) read with S. 25 of the Requisitioning and Acquisition of Immovable Property Act 1952 (hereinafter referred to as the ''1952 Act''). The petitioners were dispossessed in the year 1964 and were not paid any compensation in respect of their land Though the land had been acquired under the provisions of 1952 Act yet its market value had not been assessed by appointing an Arbitrator in accordance with the provisions of S. 8 of 1952 Act and R. 9 of the Rules framed thereunder.

Another chunk of land measuring 1495 Kanalas, 3 Marlas of village Saran was acquired by respondent No. 3 vide notification dated October 17, 1967. An Arbitrator under the provision of 1952 Act was appointed. The petitioners also made applications before the Arbitrator for determination of compensation for their land. At that stage, the learned counsel appearing for the respondent. Union of India raised objections that the petitioners'' claims have not been referred to the Arbitrator for determination. In fact, no Arbitrator had been appointed to determine the amount of compensation of the land acquired under the notification dated 14th November, 1967. Arbitrator had been appointed to determine the amount of compensation relating to the 1495 Kanals 3 Marlas of land acquired vide Gazette Notification issued on October 17, 1967. On coming to know the true position, the petitioners made representations to the various authorities but without success. The petitioners then filed the present writ petition.

The writ petition was resisted by the respondents. Separate written statements have been filed. Respondents Nos. 1 and 2 have filed one written statement and respondent No. 3 has filed his separate written statement. In the written statement of respondent No. 3, it has been, inter alia, averred that the land of the petitioners measuring 64 Kanals 16 Marlas was requisitioned under S. 29 of the Defence of India Act, 1962 and was also acquired under S. 36 of the said Act on 14th November, 1967. However, proceedings were not taken under S. 25 of the 1952 Act. The provisions of the said Act were not applicable to this case and as such no Arbitrator was appointed under the 1952 Act. The averment of the petitioners that they were the right holders has not been denied. It was pleaded that Arbitrator, if any, can only be appointed under the Defence of India Act, 1962 and not under the provisions of the 1952 Act. It is further urged that since the land was acquired under the Act, the procedure laid down thereunder and the Rules made thereunder had been followed. It is pleaded that procedure for appointment of the Arbitrator is laid down under S. 37(2) of the Act read with R. 10 of the Defence of India (Requisitioning and Acquisition of Immovable Property) Rules, 1962 (hereinafter referred to as ''the Rules''). These statutory provisions provide that a person aggrieved by the decision of the competent authority made under R. 8 of the Rules may within thirty days of the receipt of the communication of such determination, (may) make an application in writing to the Competent Authority for referring the matter to an arbitrator stating therein the reasons for his being aggrieved by the amount of compensation so determined. The applications of the petitioners to the authorities other than the Competent Authority and also after the period of 30 days were of no avail. Respondents Nos. 1 and 2 in their written statements have made averments on the same lines.

In order to appreciate the legal issues involved in the case, it will be appropriate to quote the relevant statutory provisions at the threshold :

Section 37 of the Defence of India Act.

37(1). The compensation payable for acquisition of any property u/s 37 shall be--

(a) the price which the requisitioned property would have fetched in the open market if it had been remained in the same condition as it was at the time of requisitioning and been sold on the date of acquisition, or

(b) twice the price which the requisitioned property would have fetched in the open market if it had been sold on the date of the requisition.

whichever is less.

(2) Where any person interested is aggrieved by the amount of compensation determined in accordance with sub-section (1), he may make an application within the prescribed time to the Central Government or the State Government, as the case may be, for referring the matter to an Arbitrator appointed in this behalf by the Central Government or the State Government, and the amount of compensation to be paid shall be such as may be determined by the Arbitrator in accordance with sub-section (1).

(3) & (4) x x x x x x x x x x

x x x x x x x x x x

Defence of India (Requisitioning and Acquisition of Immovable Property) Rules 1962 :

Rule 8. Compensation -- The Competent Authority shall as soon as may be after the property has been requisitioned, released from requisition or acquired as the case may be, determine the compensation payable under S. 30, or S. 37 of the Act and shall also apportion it where necessary among the persons known or believed to be interested in the property of whom or of whose claim to compensation he has information. Such determination shall be communicated by the Competent Authority to the person or persons in whose favour the determination has been made.

(9) Application for arbitration -- (1) A person aggrieved by the amount of compensation determined by the Competent Authority shall, within thirty days of the receipt of the communication of determination, make an application in writing to the competent authority for referring the matter to an Arbitrator stating therein the reasons for his being aggrieved by the amount of compensation so determined.

(2) Where no such application is made within the period of thirty days aforesaid and the amount of compensation as determined by the Competent Authority has not been accepted by the person or persons in whose favour the determination has been made or where there is dispute as to the title to receive the compensation or as to the apportionment of the amount of compensation, the Competent Authority may deposit the amount with the Court.

Rule 10. -- Appointment of an Arbitrator -- (1) On receipt of the application for reference to arbitration or where there is a dispute as to the title to receive the compensation or as to the apportionment of the amount thereof, the competent authority shall appoint as Arbitrator a person who is qualified under Cl. (2) of Art. 217 of the Constitution for appointment as a Judge of a High Court.

(2) Any such Arbitrator shall complete the arbitration proceedings and give his award within 4 months, provided that the Central Government may, if it thinks fit, enlarge the period for making the award whether the time for making the award has expired or not.

In the writ petition, the petitioners have mainly relied upon the provisions of the Act to plead for appointment of the arbitrator. However, in view of the categoric stand taken by the respondents in the written statements, the petitioners filed their replication in which they have taken the stand that even if acquisition has taken place in accordance with the provisions of the Act and the Rules framed thereunder, the respondents were under an obligation to appoint the Arbitrator in accordance with the provisions of S. 37(2) of the Act and R. 10 ibid. This very stand has been taken by Mr. Verma, learned counsel for the petitioners during the course of arguments.

It was contended by Shri D.D. Gupta, learned counsel for the respondents, that the petitioners did not make an application for the appointment of the Arbitrator within 30 days of the award as required by R. 9. Hence, the petitioners cannot now take up this point after the lapse of a number of years and claim appointment of the Arbitrator.

Rule 9 lays down the period for the filing of an application and that rule can be attracted only if the competent authority complies with the provisions of R. 8, viz, that it communicates its determination to the person/persons in whose favour determination has been made. It is not pleaded by the respondents that the competent authority had issued any communication to the petitioners regarding its determination as required by R. 8. The respondents in their written statements have neither averred this fact nor have they produced any material to show that the competent authority had in fact communicated its determination to the petitioners. As is apparent from the title of the writ petition, the petitioners belong to different families. Petitioners Nos. 1 and 3 are the sons, 4 and 5 are the daughters and No. 2 is the widow of Nathi Ram. Similarly, petitioners Nos. 7, 8 and 9 are the sons of Khazim, petitioner No. 12 Kishan Piari is the wife and petitioner No. 13 is the son of Ram Kishan. They claim to have succeeded to the estate of Ram Kishan. So compensation had to be determined and apportioned inter se the claimants. Same is the case of petitioners Nos. 14, 15, 16, 17 and 18. Rule 9 lays down in clear terms that any person aggrieved by the amount of compensation determined by the competent authority, shall within 30 days of the receipt of the communication of determination, make an application in writing to the competent authority for referring the matter to an Arbitrator stating therein the reasons for his being aggrieved by the amount of compensation so determined. Thus, the period of limitation starts running from the time the communication of the determination is received by the aggrieved persons from the competent authority. The time does not start running till the receipt of such a communication. In the absence of cogent evidence that the petitioners had received such a communication from the competent authority it cannot be said that the petitioners had lost their right by lapse of time. A Division Bench of this Court had an occasion to examine the Rr. 8 and 9 of the Defence of India (Requisitioning and Acquisition of Immovable Property) (Punjab) Rules 1963, which are parimateria with Rr. 8 and 9 of the Rules, in Diw an Ishwar Dass v. State of Punjab, ILR (1970) P&H 137. It was held therein that the provisions of R. 8 were mandatory on the same analogy, Rr. 8 and 9 of the Rules are held to be mandatory. Since provision of R. 8 had not been complied with the provision of R. 9 providing the period of limitation for filing application for the appointment of an Arbitrator are not attracted and it cannot be contended that the applications of the petitioners under R. 9 for referring the matter to an Arbitrator would be time barred.

If the petitioners are now required to make applications before the Competent Authority under Rr. 9 and 10 of the Rules, it will entail wastage of more time. It is a very old case, the petitioner''s land was acquired in 1964, yet compensation has not been determined.

Taking into consideration all these facts and circumstances of the case, I direct that the respondents shall appoint an Arbitrator to determine the compensation within a period of three months. The petitioners shall be at liberty to file their claims before the Arbitrator. It is needless to say that the Arbitrator who is to be appointed, shall dispose of the matter expeditiously. Respondent No. 3 shall pay Rs. 1000/- as costs to the petitioners.