# [1973] 1 S.C.R. 959

- **Citation:** [1973] 1 S.C.R. 959
- **Court:** Supreme Court of India
- **Decided:** 1972-08-23
- **Case number:** Civil Appeal No. 1025 of 1967
- **Bench:** A. N. Ray, I. D. Dua
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/1973-1-s-c-r-959-5748
- **Pages:** 5

## Headnote

959
Requisitioning and Acquisition of Immovable
Property
Act
1952.
s. 8(3)-CornpensMion under-Requisiticn originally made under Defence of India Act, 1939-Whether requisitioning continued till acquisition made undq 1952 A.ct.
The property in question was requisitioned by the Government
of
India with effect from 17 July 1942 under Rule 75 (A) of the Dofencc
of India Rules, 1939, The Oovernmont was in possession of the property
until the Government decid,d to acquire the property in 1953.
There
was dispute between the Government and the appellants, in whose favour
the proporty was he'd under trust, in regard to the compensation payable.
Under s. 8 (1) of the Requisitioning and Acquisition of Immovable Pro·
p,erty Act 1952 the Government appointed the District Judge, Patna as
the sole Arbitrate:.
The Arbitrator held that the provisions of s. 8(3)
(b) of the 1952 Act under which the compensation payable was twice
the price which the requisitioned property would have fetched in the open
market if it had been sold on the date of acquisition, would apply for
determination of compensation payable for requisition of the property.
The High Court in appeal upheld the award of the Arbitrator. In appeal
to this Court by special leave the question that fell for consideration was
\\'hether the compensation would be determined under clause (a) or (b)
of sub-section (3) of s. 8 of the 1952 Act.
Under cl. (a) the compensation shall be the price which the requisitioned property
would have
fetched in the open market if it had remained in the same condition as. it
was at the time of requisitioning and been sold on the date of acquisi·
lion.
Another contention raised by the appellant was whether the Defence of India Act 1939 having lapsed in February 1946 the year of
requisition should be 1952 when the 1952 Act came into effect.
HELD: (i) The requisitioning of the property in question under the
1939 Act was continued by the Requisitioned Land (Continuance
of
Powers) Ordinance
1946 and
thereafter by the
Requisitioned Land
(Continuance of Powers) Act 1947, the Requisitioning ancl Acquisitio:1
of Immovable Property Ordinance 1952 and eventually by the 1952 Act.
Therefore the contention that the year of requisition should
be 1952
when the 1952 Act came into effect, was unsound. [961F-962B]
(ii) In Parekh's case this Court held that the mode of determination of
compensation provided in section 8(3) (b) of the 1952 Act is arbitrary
and bad. The result is that the award which was made in the present
case pursuant to the provisions contained in section 8(3) (b) of the 1952
Act could not be sustained.
The appellants would therefore be entitled
to compensation in accordance with the provisions contained ln section
8(3)(a) of the 1952 Act. In 1968 bv an amendment clause (b) of section 8(3) of the 1952 Act was deleted and section 8(a) was preserved as
sub-sec. (3) of s. 8. [962E-F]
Union of India v. Kamlabhai Harjiwandas Parekh & Ors., (1968] 1
S.C.R. 463, applied.
960
SUPREME COURT REPORTS
[1973] l S.C.R.
(iii) There was no substance in the
contention on behalf
of the
Government that though s. 8(3)(b) was applied by the Arbitrator
in
surnitaoce the Arbitrator gave effect to the provisions of clause (a)
of
section 8(3) of the 1952 Act. [962Gl
(iv) The j.;dgment of the High Court upboldfog the award· of the
Arbitrator must therefore be set aside.
Compensallon to the appellant£
mu•t be given under s. 8 of the Act. [Directions given acc<>rdingly].
[962H]

## Text

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G
H
HARINARAYAN & ORS.
V. '
UNION OF INDIA & ANOTHER
August 23, 1972
[A. N. RAY AND I. D. DUA, JJ.]
959
Requisitioning and Acquisition of Immovable
Property
Act
1952.
s. 8(3)-CornpensMion under-Requisiticn originally made under Defence of India Act, 1939-Whether requisitioning continued till acquisition made undq 1952 A.ct.
The property in question was requisitioned by the Government
of
India with effect from 17 July 1942 under Rule 75 (A) of the Dofencc
of India Rules, 1939, The Oovernmont was in possession of the property
until the Government decid,d to acquire the property in 1953.
There
was dispute between the Government and the appellants, in whose favour
the proporty was he'd under trust, in regard to the compensation payable.
Under s. 8 (1) of the Requisitioning and Acquisition of Immovable Pro·
p,erty Act 1952 the Government appointed the District Judge, Patna as
the sole Arbitrate:.
The Arbitrator held that the provisions of s. 8(3)
(b) of the 1952 Act under which the compensation payable was twice
the price which the requisitioned property would have fetched in the open
market if it had been sold on the date of acquisition, would apply for
determination of compensation payable for requisition of the property.
The High Court in appeal upheld the award of the Arbitrator. In appeal
to this Court by special leave the question that fell for consideration was
\\'hether the compensation would be determined under clause (a) or (b)
of sub-section (3) of s. 8 of the 1952 Act.
Under cl. (a) the compensation shall be the price which the requisitioned property
would have
fetched in the open market if it had remained in the same condition as. it
was at the time of requisitioning and been sold on the date of acquisi·
lion.
Another contention raised by the appellant was whether the Defence of India Act 1939 having lapsed in February 1946 the year of
requisition should be 1952 when the 1952 Act came into effect.
HELD: (i) The requisitioning of the property in question under the
1939 Act was continued by the Requisitioned Land (Continuance
of
Powers) Ordinance
1946 and
thereafter by the
Requisitioned Land
(Continuance of Powers) Act 1947, the Requisitioning ancl Acquisitio:1
of Immovable Property Ordinance 1952 and eventually by the 1952 Act.
Therefore the contention that the year of requisition should
be 1952
when the 1952 Act came into effect, was unsound. [961F-962B]
(ii) In Parekh's case this Court held that the mode of determination of
compensation provided in section 8(3) (b) of the 1952 Act is arbitrary
and bad. The result is that the award which was made in the present
case pursuant to the provisions contained in section 8(3) (b) of the 1952
Act could not be sustained.
The appellants would therefore be entitled
to compensation in accordance with the provisions contained ln section
8(3)(a) of the 1952 Act. In 1968 bv an amendment clause (b) of section 8(3) of the 1952 Act was deleted and section 8(a) was preserved as
sub-sec. (3) of s. 8. [962E-F]
Union of India v. Kamlabhai Harjiwandas Parekh & Ors., (1968] 1
S.C.R. 463, applied.
960
SUPREME COURT REPORTS
[1973] l S.C.R.
(iii) There was no substance in the
contention on behalf
of the
Government that though s. 8(3)(b) was applied by the Arbitrator
in
surnitaoce the Arbitrator gave effect to the provisions of clause (a)
of
section 8(3) of the 1952 Act. [962Gl
(iv) The j.;dgment of the High Court upboldfog the award· of the
Arbitrator must therefore be set aside.
Compensallon to the appellant£
mu•t be given under s. 8 of the Act. [Directions given acc<>rdingly].
[962H]
CIVIL APPELLATE JURISDICTION.: Civil Appeal No.
1025
of 1967.
Appeal by special leave from the judgment and decree dated ·
January 13, 1961 of the Patna Itigh Court in Appeal from Original Order No. 198 of 1956.
Sarioo Prasad, K. K. Sinha, Nand Kishore Prasad, S. K. Sinha·
'md B. B. Sinha, for the appellants.
S. P. Nayar, for re.spondents Nos. 1 and 2.
A
c
The Judgment of the Court was delivered by
D
Ray, J. This appeal is by special leave from the judgment
dated l3 January, 1961 of tho High Court at Patna dismissing the
appeal filed by the appellants agdnst the award dated 25. May,
1956 of the Arbitrator under the Requisitioning and Acquisition
of Immovable Property Act, 1952 (hereinafter referred to as the
l 952 Act).
E
The appellants' mother purcha.!00 the property known as "the
Crove" situate on Station Road at Patna on 18 September, 1944.
The appellants' mother thereafter made a trust deed i;, the year
I 946 in respect of the property in favour of the appellants.
The property was requisitioned by the Government of India
with effect from 17 July, 1942 under Rule 75(A) of the Defence
of bdia Rules. The Government was in possession of the property
until the Government decided to a:quire the property in the year
1953.
The Central Govc:rnment )!ave notice under section 7 of
the-1952 Act to acquire the property. The property was acquired
in 1953.
The Government thereafter offernd to the appellants a sum of
Rs. 2.47,990/- ns a valuation of the property
acquired.
The
:1ppellants claimed Rs. 18,00,000/- as the valuation.
Under section 8(1) of the 1952 Act the Government appointed
th~ District Judge, Patna as the sore Arbitrator to determine the
:unount of compensation payable to the appellants in respect of
the property. The Arbitrator held that in view of the provisions
contained in sections 23 and 24 of the 1952 Act the provisions of
'ection 8(3)(b) of the 1952 Act would apply for determination
of compensation payable for acquisition of the property.
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HARINARAYAN v. UNION (Ray, J.)
961
The appellants preferred an appeal against award of the Arbitrator. Section 11• of the 1952 Act provided for such appeal.
The High Court hdd that section 8(3)(b) of the 1952 Act
applied and upheld. the award of the Arbitrator.
The question which falls for consideration in this appeal is
whether the compensation would be determined under clause (a)
or (b) of sub-section(~) of section 8 cf the 1952 Act. The relevant provisi9ns are set out hereunder :-
"8(3). The compensation payable for the acquisition
of any property under section 7 shall be--
(3) the price which the requisitioned property would
have fetched in the open market, if it had remained in
the same condition as it was at the time of requisi(ioning
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 acquisition.
whichever is less*.
Counsel for the appellants
raised these
contentions.
The
Defence of India Act, 1939 and the Rules made thereunder ceased
to be effective on 14 February, 1946. · There was no order of
requisition under the 1952 Act. For the purpose of determination
of compensation of the property under the 1952 Act the property
could at best be held to be requisitioneo: when the 1952 Act came
into existence. It was erroneous to treat the property to be requisitioned under the 1952 Act.
The essence of the appellant's contention is that the year of
requisition should be 1952 when the 1952 Act came into effect.
This contention is unsound.
The Requisitioned Land (Continuanee of Powers) Ordinance, 1946 (Ordinance No. XIX of 1946)
provided in section 3 thereof that ·"notwithstanding the expiration
of the Defence of India Act, 1939 and the Rules made thereunder,
all requisitioned lands shall continue to be subject to requisition
until the expiry of this Ordinance and the appropriate Government
may use or deal with any requisitioned land in such manner as may
appear to it to be expedient; provided that the appropriate Government may at any time release from requisition any requisitioned
land". The property continued to be in possession of the Government under orders of requisition da(ed 17 July, 1942. The property W<~ not released from requisition. '11! is manifest from Ordinance No. XIX of 1946 that the propertv which was requisitioned
under the Defence of India Act continued to be subiect to requisition in spite of the expiry of the Defence of Tndia Act.
i "_:_Lt 72Sup.Cl/73
962
SUPREME COURT REPORTS
[1973] 1 S.C.R.
Thereafter the Requisitioned Land (Continuance of Powers)
Act, 1947 came in place of Ordinance No. XIX of 1946. The
Requisitioning and Acquisition of Immovable Property Orclinance
1952 came into effect on repeal of the 1947 Act.
Finally, the
Requisitioning and Acquisition of Immovable Property Act, 1952
came into existence in place of the 1952 Ordinance. These various
provisions and in particular section 24(2) of the 1952 Act show
that the property became deemed to be property requisitioned nnder
section 3 of the Act. Just as Ordinance No. XIX of 1946 continued the acquisition of property, similarly the subsequent provisions under the 1947 Act, the 1952 Ordinance and eventually the
1952 Act continued the requisition.
The power to acquire requisitioned property is to be found in
section 7 of the 1952 Act. In view of the fact that the property
was subject to requisition the Government desired to acquire the
property in the year 1953. The property was acquired on 11
Septetrber, 1953 under the 1952 Act.
The appellants became
entitled to compensation under section 8 of the 1952 Act. The
two clauses (a) and (b) of section 8 ( 3) of the 1952 Act provide
the alternative
methods for
compensation for
acquisition of
property.
In Union of India
v.
Kamlabhai Harjiwandas Parek/J &
Otlzers('') this Court held that the mode of determination of coi. -
pensation prescribed in section 8 ( 3) (b) of the 1952 Act is arbitratory and bad. The result is that the award which was made in the
present case purcuant to the provisions contained in section 8(3)(b)
of the 1952 Act cannot be sustained. The appellants will t"defore be entitled to compensation in accordance with the provisiom
contained in section 8(3) of t11e 1952 Act. It may be stated that
in 1968 by an amendment clause (b) of section 8 (3) of the 1952
Act was deleted. The 1968 Amendment has preserved clause (a)
of section 8(3) of the 1952 Act by deleting clause (a) and numbering it as sub-section (3) of sec\ion 8.
Counsel on behalf of the Government contended that though
section 8(3)(b) of the 1952 Act was applied by the Arbitrator, in
substance the Arbitrator gave effect to the provisions of clause (a)
of section 8(3) of the 1952. Act. The award does not say so .. On
the contrary, the award is expressly made under the provisions of
section 8(3)(b) of the 1952 Act.· The contention of the Government therefore fails.
For these reasons, the judgment of the High Court which upheld the award of the Arbitrator is set aside.
The Government
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will have to act in accordance with the provisions contained in
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section 8 for determining compensation payable to the appellants.
"
(I) [1968] I s.c.R. 463.
A
HARINARAYAN v. UNION (Ray, J.)
If the parties will not be able to reach an agreement as ~ the
amount of compensation th() Central Government shall appoint an
Arbitrator as contemplated in section 8 of the 1952 Act for determining the compensation payable to the appellants. The appellants
will be entitled to cos_ts of this appeal.
G.C.
Appeal Allowed.
'