Thursday, February 27, 2025

Patna High Court's Division Bench modifies judgement of Justice Anil Kumar Sinha in Land Acquisition Fair Compensation case

We must ask: "why statements are acceptable in 'development' discourse that would be considered absurd in academic settings, but also why many acceptable statements from the realm of academic discourse - or even from that of common observation - fail to find their way into the discursive regime of 'development'"

-James Ferguson (1990). The Anti-Politics Machine: "Development," Depoliticization and Bureaucratic Power in Lesotho, Cambridge University Press. p. 67.

It seems all is fair in war, government, for "public purpose", and development. Warmongering, governmentality, veil of public purpose,  governmentality and  developmentality manifest themselves in myriad deceptive ways.

The judgement of Patna High Court's division bench by Acting Chief Justice Ashutosh Kumar and Justice Partha Sarthy reminds one of insights from The Anti-Politics Machine, the book by James Ferguson. The judgement was authored by Justice Kumar. He observed: "the direction of the learned Single Judge that it should be done first and then compensation be paid, would not be practical in the sense that updating the Circle Rates require time and in the present circumstance, time would be the essence especially if seen in the context of the land owners who have been divested of their land who would require money urgently for their resettlement" in Ranjeet Kumar and others vs. The State of Bihar & others (2025). Besides the State of Bihar, there were 16 respondents. In a batch of petitions, the 71-page long judgement of the division bench concluded:"We, therefore, modify the judgment of the learned Single Judge and direct that the MVR/Circle rates of 2014 must be updated, which would be an independent exercise which shall be carried out by the State after observing the due process in that regard but the payment of compensation to the land owners would not be contingent on such updation as it would take long time. Thus the appeals on behalf of the land owners are dismissed whereas the appeals preferred by the State and the PMRC are allowed to the extent indicated above." PMRC refers to Patna Metro Rail Corporation. 

Justice Anil Kumar Sinha, the Single Judge had passed his 125-page long judgement and order on December 21, 2023 after hearing the petitioners who were land as well as the house owners, whose properties were acquired for the construction of Patna Metro Rail Depot, having a total area of 75.96 acres of land, in two mauza, i.e. Pahari and Ranipur. They had approached the High Court for quashing of the land acquisition notice, issued under Section 11 (1) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 with regard to 15.95 acres of land, situated in mauza Pahari and 23.35 acres of land, situated in mauza Ranipur, having a total area of 75.96 acre. the petitioners had prayed for setting aside the Social Impact Assessment Report prepared by the Development Management Institute, Patna. They had also prayed for quashing of the formation of Technical Expert Committee, constituted under Section 7 of the 2013 Act as well as quashing of the report of the Technical Expert Committee, dated June 30, 2021. They sought quashing of the order dated February 2, 2022 passed by the District Land Acquisition Officer, Patna, by which objections filed by the petitioners were rejected, for quashing the paper publication, under Section 19 of the 2013 Act. They also sought quashing of the award, dated August 4, 2023, prepared in L. A. Case No. 29/2021-2022, under Sections 23 and 30 of the 2013 Act. 

Earlier two depots were to be constructed in mauza Aitwarpur and mauza Ramchak Bairiya, but subsequently it was decided to construct only one depot, at mauza Pahari and Ranipur. The Cabinet of the State of Bihar approved the Patna Metro Rail Project on October 9, 2018. Rail India Technical and Economic Service (RITES) had given the proposal for two depots. On September 3, 2019, the work of construction of Metro Rail and Depot in Patna was given by Patna Metro Rail Corporation Limited (PMRCL) to Delhi Metro Rail Corporation (DMRC) and the same was approved by State of Bihar. The agreement between PMRCL and DMRC was entered on September 25, 2019. The DMRC made changes in the line alignment of the Patna Metro on February 8, 2020 and also changed the location of metro depot from two locations to one locations, i.e. mauza Pahari and Ranipur, which are under acquisition. The lands have been acquired under the general provisions of the 2013 Act. The Urban Development and Housing Department, Government of Bihar, issued an Office Order on March  17, 2020, in which reasons for relocation of the Metro depot from two depots to one depot, has been mentioned that there shall be large number of demolition of houses at previous location, drainage system, seamless integration of I.S.B.T. and the Metro depot, and further 11.6 Hectares for the purpose of Property Development Area. The revised detailed project report has been approved by the State Government and the Union Government.

Justice Sinha had framed the following questions for considerations by the Court:

(a) Whether the provisions of the 2013 Act have been followed for acquiring the land, in question?

(b) Scope of rehabilitation and resettlement, if any

(c)Whether the property development area and the depot area are integral part of the PMRP?

(d) Whether the PMRP, including the property development area, is a project of larger public interest?

Justice Sinha had also  considered the question as to how to ascertain the just and fair compensation, which the petitioners and others are entitled. He observed: "The price of the land in Patna has skyrocketed and increased manifold, but the M.V.R./circle rate of the area has not been revised for many years. The Court has been informed that the compensation has been fixed on the M.V.R./circle rate prevalent in the year 2014. The M.V.R./circle rate is provided for the purpose of payment of stamp duty, but that cannot be made a basis to determine the actual price of the market value of the property. The purchasers, while purchasing the land, in the sale deed, quote the consideration amount on the basis of the M.V.R./circle rate and not the actual price paid for the purchase of the land.

The judgement of Justice Sinha reads:"let the M.V.R./circle rate, which has not been revised since long by the Collector, be revised by taking into consideration the relevant factors, including the opinion of the Expert. The concerned respondents are further directed to re-fix the compensation amount, payable to the petitioners, based upon the revised M.V.R./circle rate. Justice Sinha recorded that recommendations of the Expert Committee, have not been considered by the State Government, including the recommendation of the Expert Committee on the point of rehabilitation and resettlement, accordingly, I direct the State Government and the Collector, Patna, to consider the recommendation of the Expert Committee, and to take decision on the point of rehabilitation and resettlement of the land/house losers, as per Section 31 of the 2013 Act." He concluded that these "exercises must be completed by the respondents within the maximum period of six months from today. "

The Single Judge on the issue of breach of Rule -11 (3) of Rules of 2014 mandating that public hearing must be announced three weeks in advance through daily newspaper and clear 21 days time is required to be given to the landholders, had held that from the materials put forth by the parties, it transpired that in the public hearing during the course of preparation of Social Impact Assessment Report by the Development Management Institute, Patna, 111 persons had participated but according to the State, 250 people as well as representatives of Ward No. 56 had participated and that there was substantial compliance of the provisions except some procedural lapses here and there.

In the opinion of the Single Judge, the Social Assessment Impact Report clearly stated that the positive impact had a higher quotient than negative impact.

With respect to the opposition regarding non-consideration of alternative sites suggested by the land owners, the Single Judge was of the view that the same was considered but not found to be suitable as the site suggested for construction of depot would have incurred extra cost ranging between 500-700 crores and that no interference was required since the construction work has started at the selected site and the progress was to the extent of 44%.

Majority of the land owners, it was found, had already received compensation to the tune of Rs. 130 crores. The suitability of land, the learned Single Judge agreed, fell in the domain of the acquiring agency as also the agency executing the project and they are the best judge to decide the suitability and feasibility of the project including the site selected. Relying on Ramji Veerji Patel case, it was held that it was not open to the Court to examine the aspect of suitability and the Court substituting its opinion with that of the acquiring and executing agency.

With respect to the objection regarding the formation of the Expert Committee for appraisal of Social Assessment Impact Report as mandated under Section 7(2) (b) of 2013 Act, the revelation by the Advocate General that the proposal of the Expert Committee was not considered by the State Government as it was not found to be viable, was taken into account.

The argument with respect to the property development area component of the project not being relatable to public purpose, it was held that in view of the reason that Metro Rail Policy, 2017 contemplated provisions for enhancement of revenue of the Metro rail projects and included commercial/property development at stations and on other urban land which could be used as key instruments for maximizing revenue in Metro rail/railway systems in the cities, no fault could be found. The exemplars were drawn from Hongkong and Tokyo. It was found from the records that while conceiving of the project, the State had taken into all the above factors which would increase the non-fair box revenue which was in sync with the Metro Rail Policy, 2017 and hence the construction and development of property development area was held to be part of the public purpose and it was complementary to each other and therefore integral to the scheme of PMRP. 

It was thus concluded, in view of the judgment in Godrej & Boyce vs The State Of Maharashtra case, that even if there are some irregularities in the procedure followed by the acquiring authority for infrastructural project, the Courts, in exercise of their extraordinary discretionary power under Article 226 of the Constitution of India ought not to interfere, especially when the project is of public importance. In matters of land acquisition for public purposes, the interest of justice and public interest intermingle.

The Single Judge, therefore, refused to interfere with the process of acquisition.

However, while considering the issue of just and fair compensation to which the land owners would be entitled, a direction was issued that the MVR/Circle Rates which had not been revised since long by the Collector, be revised after taking into consideration the relevant factors including the opinion of the experts and then re-fix the compensation amount payable to the land owners based upon the revised MVR/Circle Rate.

While assailing the judgment of the Single Judge, Amit Sibbal, the Senior Advocate appearing virtually argued that even though right to property has ceased to be a fundamental right after the 44th amendment of the Constitution, it continues to be a constitutional right under Article 300A and therefore any expropriatory law which deprives a person of his property nust be in line with the overarching principles of law and must be just fair and reasonable. The exercise of power of eminent domain ought to be construed narrowly in favour of a person’s right to his property. It was argued that the land owners would not do good by challenging the public purpose behind the acquisition proceedings. The challenge thus is primarily to the manner in which the proceedings were concluded with complete disregard to the statutory safeguards. Whether the land is to be acquired under the Act, under the new law cannot be a unilateral decision. The process has to be humane, informed and transparent with least disturbance to the owners of the land and the affected families and the deprived persons would be entitled to just and fair compensation.

In this context, it was argued that Social Impact Assessment study is not a mere formality and the Single Judge has erred in law in being satisfied about substantial compliance of the provision, looking aside procedural lapses here and there.

Relying on Urban Development Trust, Bikaner vs. Gordhan Das (dead) Through LR (2024) 3 SCC 250; Kolkata Municipal Corporation & Anr. vs.Bimal Kumar Shah & Ors. (2024) 10 SCC 533; D.B.Basnett vs. Collector, East District Gangtok, Sikkim (2020) 4 SCC 572; Vidya Devi vs. State of Himachal Pradesh (2020) 2 SCC 569; Dinesh & Ors. vs. State of Madhya Pradesh & Ors. (2024) SCC Online SC 937; Kamal Trading Pvt. Ltd. vs. State of West Bengal (2012) 2 SCC 25; Rajesh K vs. Managing Director, Kerala Rail Development Corporation (WP(C) 41009/22 (Kerala High Court) and Manekbben Rama Tandel vs. The Collector, Daman, Union Territory of Dadra and Nagar Haveli & Daman and Diu & Ors.(MANU/MH/1796/2023), it was argued that the importance of property rights and requirements of strict adherence to procedure cannot be ignored or by-passed or else the entire acquisition proceeding gets vitiated.

Taking the argument of “acquisition by ambush” further, which is impermissible, it was pointed out that there was complete disregard to the procedural safeguards under Sections 4, 5, 7, 8, 11, 15, 16 and 19 in as much as there was no finding or analysis with regard to land being the bare minimum land required for public purpose.

Even with respect to rejection of the alternative places where the depots could be constructed, it was argued that it was not prudent to discard such suggestions as the land suggested viz.

The Sahara land, Gair Mazarua lands and a dumping yard in close vicinity to the selected site would have caused minimum displacement and minimum requirement to resettle and rehabilitate human heads. It would have reduced the cost of acquisition for the Government. The rejection was not based on any sound reason.

A special grievance was made with respect to only three days having been given for voicing the objection in place of clear 21 days and that also at a time when the State was swept by COVID -19 pandemic. A special reference was made to the letter of one Councilor viz. Kismat Devi of Ward No. 56, where she had highlighted the difficulties faced by the affected people of the area and inefficacy and the infirmities in the S.I.A. study being conducted by the State.

Even if the argument on behalf of the State that 250 people had participated in the public hearing, the persons affected were numbering around 1300.

Section 15 of the 2013 Act provides the right of the people affected by the land being acquired under Section 11 notification to raise objections with respect to the suitability of the land being acquired and the findings of the S.I.A. study report. The objections raised by the displaced persons are stated to have been mechanically rejected without due consideration. The Single Judge having lightly dealt with the lapses suggested that it was not understood that the preparation of Social Impact Assessment Report and its vetting by the Special Expert Committee are the heart and soul of the Act and represent the very purpose of the humane, participative, informed and transparent process of land acquisition envisaged under the scheme of the Act. The argument of the State as also PMRCL regarding nonsuitability of the alternative site was not based on any pleadings on affidavit or any minutes of the meeting of a technical body or any data or reasoning. The dumping yard displacing none, in fact, could have been shifted elsewhere and that land which in itself would have sufficed the purpose could have been selected as the site in fact in one of the writ proceedings sometimes in the year 2012, the High Court had directed the State to consider relocating the dumping yard as it was within the municipal limits and was causing hazards and other health hazards. 

The Supreme Court and High Courts have recognised that the expression " public purpose " is not capable of precise definition. The concept of "public purpose finds mention in article 31(2) of the constitution of india. 

In University of Bombay v. municipal commr. of the city of Bombay, I.L.R.16 Bom. 217, it has been held that acquisition of land comes with the purview of public purpose if it is meant for providing suitable accommodation to the public servant.

In Radha Binode v. Surendra Nath, 105 I.C. 377, it has been held that acquisition of land for providing road facilities in municipal areas is public purpose.

In State of Bombay v. R.S. Nanji, A.I.R 1956, S.C. 294, it has been held that acquisition of land for providing housing accommodation for homeless is public purpose. 

In Iftikher Ahmed v. state of M.P, A.I.R. 1961 M.P 140, it has been held that acquisition of land for establishment of slaughter house for maintaining supplies of food in locality is public purpose.

In Ganga Prasad Verma v. State of M.P., A.I.R. 1968 M.P. 22, it has been held that acquisition of land for resettlement and rehabilitation of displaced persons is public purpose. 

In Walliammal v. state of Madras and Others, 1967 Mad 334: (1965) 2 Mad. 388: (1966) 79 Mad. LW 702, it has been held that acquisition of land for opening of a burial ground is public purpose.

In Guru Shiddawwavitra Sangayya v. state of Mysore, 1968 Mys 127, it has been held that removal of timber shops from the scattered places in the city area to a place outside the city area for the establishment of timber market comes under public purpose. An acquisition is for public purpose when it involves an element of public utility, provides public good and aims for social welfare. Acquisition need not be an acquisition which benefits each and every member of the public.

The 2013 Act which came into force on January 1, 2014 defines public purpose. The Act is applicable when the land is acquire by the government for its own use, including land acquired for public sector undertaking. The land is acquired by the land with the intention of transferring it for the use of private company for the specific stated public purpose. The acquisition of land by the government for immediate and declared use by private companies for public purpose.

The definition of public purpose is provided in the 2013 Act. Under Section 2 (1) (a) states that acquisition of land for public purpose can be undertaken for strategic purposes relating to naval, military, air force, and armed forces of the Union, including central paramilitary forces or any work vital to national security or defence of India or State police, safety of the people. 

Under Section 2 (1) (b) (i) states that acquisition of land for public purpose can be undertaken for infrastructure projects: excluding private hospitals, private educational institutions and private hotels.

Under Section 2 (1) (b) (ii) states that acquisition of land for public purpose can be undertaken for projects related to agriculture and allied activities set up or owned by the appropriate Government or by a farmers' cooperative or by an institution set up under a statute. 

Under Section 2 (1) (b) (iii) states that acquisition of land for public purpose can be undertaken for project for industrial corridors or mining activities, national investment and manufacturing zones. 

Under Section 2 (1) b (iv-vii) states that acquisition of land for public purpose can be undertaken for water conservation structures sanitation, Government aided educational and research schemes or institutions, sports, healthcare, tourism, transportation or space programme or any infrastructure facility as may be notified in this regard by the Central Government and after tabling of such notification in Parliament. 

Under Section 2 (1) (f) states that acquisition of land for public purpose can be undertaken project for project affected families, for housing for such income groups, as may be specified from time to time by the appropriate Government, for residential purposes to the poor or landless or to persons residing in areas affected by natural calamities, or to persons displaced or affected by reason of the implementation of any scheme undertaken by the Government, any local authority or a corporation owned or controlled by the State. 

Under Section 2 (2) (a) states that acquisition of land for can be undertaken project for public private  partnership projects, where the ownership of  the land continues to vest with the Government, for public purpose. 

Under Section 2 (2) (b) states that acquisition of land for can be undertaken project for private companies for public purpose. 

In this backdrop, the division bench of the Patna High Court opined that "there is no gainsaying that establishment of Metro line in the city of Patna is in public interest. No further ink is required to be wasted in deciding whether it is in public interest or not. Relieving the city dwellers of traffic congestion, providing fast moving traffic and the income generated from the property development area are by no means opposed to public interest."

It is apparent that the division bench of the High Court did not pay heed to the decision of Supreme Court in Greater Noida Industrial Development Authority Vs. Devendra Kumar and Others reported in 2011(12) SCC 375 held that “Legal malice is gibberish unless juristic clarity keeps it separate from the popular concept of personal vice. Pithily put, bad faith which invalidates the exercise of power—sometimes called colorable exercise or fraud on power and oftentimes overlaps motives, passions, and satisfaction—is the attainment of ends beyond the sanctioned purposes of power by simulation or pretension of gaining a legitimate goal. The action is bad where the true object is to reach an end different from the one for which the power is entrusted, goaded by extraneous considerations, good or bad, but irrelevant to the entrustment. When the custodian of power is influenced in its exercise by considerations outside those for the promotion of which the power is vested the court calls it a colorable exercise and is undeceived by illusion”, a veil of public purpose was employed to acquire land from the people who were misled in the name of planned industrial development



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