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TMI Blog1964 (3) TMI 134X X X X Extracts X X X X X X X X Extracts X X X X ..... to undertake legislation reserving power to compel any person who had purchased land on or after a date to be prescribed in 1947 in the lignite-bearing areas to sell such lands to the Government at the rate at which it was purchased. The Government also advised the owners of the lignite-bearing lands in the Vriddhachalam and Cuddalore taluks not to sell their lands to speculators. On January 7, 1953, the Government of Madras published a Bill to amend the Land Acquisition Act I of 1894 in certain respects. The Bill was duly passed by the State Legislature on June 2, 1953 and received the assent of the President. It was published as an Act on June 10, 1953 and came into force on August 20, 1953. By this Act substantially three provisions are made : (1) that compensation for acquisition of lignite-bearing lands under the Land Acquisition Act as amended, is to be assessed on the market value of the land prevailing on April 28, 1947, and not on the date on which the notification is issued under s. 4(1) of the Land Acquisition Act; (2) power is reserved under s. 17 of the Land Acquisition Act to take possession in cases of urgency of lands for the purpose of working lignite mines i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Madras, with certificate of fitness granted by the High Court under Art. 132 of the Constitution. 4. The Madras Act XI of 1953 makes an important departure from the scheme of the Land Acquisition Act I of 1894. Under the Land Acquisition Act I of 1894, a person interested in any land compulsorily acquired is entitled to the market value of his interest in the land at the date of the publication of the notification under s. 4(1), and this compensation includes the value of all improvements agricultural and nonagricultural made in the land upto the date of the notification. By Madras Act XI of 1953, compensation made payable for compulsory acquisition of land is the value of the land on April 28, 1947, together with the value of any agricultural improvements made thereon after that date and before publication of the notification under s. 4(1). The result of the Madras Act is therefore to freeze for the purpose of acquisition the prices of land in the area to which it applies, and the owners are deprived of the benefit of appreciation of land values since April 28, 1947, whenever the notification under s. 4(1) may be issued and also of non-agricultural improvements made in the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erty was contained in Entry 42 List III of the Seventh Schedule and read as follows : Principles on which compensation for property acquired or requisitioned for the purpose of the Union or of a State or for any other public purpose is to be determined, and the form and the manner in which such compensation is to be given. 7. The Constitution therefore conferred by Art. 31(2) a fundamental right upon every person, protecting his property against compulsory acquisition otherwise than by authority of law, and without just indemnification for loss suffered by him. In The State of West Bengal v. Mrs. Bela Banerjee and others [1954]1SCR558 this Court observed that when under Entry 42 List III the Legislature was given discretionary power to lay down the principles which should govern determination of the amount to be given to the owner of the property appropriated, such principles must ensure that what is determined as payable must be a just equivalent of what the owner has been deprived of, and that subject to this basic limitation the Constitution allowed free play to the legislative judgment as to what principles should guide the determination of the amount payable. The Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amental right. 9. Counsel for the State of Madras relying upon the following observation of Patanjali Sastri, C.J., in Mrs. Bela Banerjee's case [1954]1SCR558 : The fixing of an anterior date for ascertainment of value may not, in certain circumstances, be a violation of the constitutional requirement as, for instance, when the proposed scheme of acquisition becomes known before it is launched and prices rise sharply in anticipation of the benefits to be deprived under it, but the fixing of an anterior date, which might have no relation to the value of the land when it is acquired, may be, many years later, cannot but be regarded as arbitrary , 10. submitted that a law which merely fixes the market value on a date anterior to the date on which the owner is expropriated of his land, as determinative of the market value on which the compensation is to be based, cannot without further enquiry be regarded as infringing Art. 31(2) of the Constitution. In our view this observation cannot assist the State of Madras in saving the provisions of Madras Act XI of 1953 from the vice of infringing the constitutional guarantee under Art. 31(2) of the Constitution. The right which i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idence that compensation assessed on the basis of market value on such anterior date, awards to the expropriated owner a just monetary value of his property at the date on which his interest is extinguished, the provisions of the Act arbitrarily fixing compensation based on the market value at a date many years before the notification under s. 4(1) was issued, cannot be regarded as valid. It is a matter of common knowledge that since the termination of hostilities in the last World War there has been an upward tendency in land values resulting in appreciation in some areas many times the original value of lands. No attempt has been made by the State to prove that appreciation in the market value of lands in the area since April 1947 was solely attributable to a scheme of land acquisition of lignite bearing lands. To deny to the owner of the land compensation at rates which justly indemnify him for his loss by awarding him compensation at rates prevailing ten years before the date on which the notification under s. 4(1) was issued amounts in the circumstances to a flagrant infringement of the fundamental right of the owner of the land under Art. 31(2) as it stood when the Act was en ..... X X X X Extracts X X X X X X X X Extracts X X X X
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