INDORE DEVELOPMENT AUTHORITY v. MANOHARLAL & ORS. ETC.

190Copy pinpoint190. A proviso has to be construed as a part of the clause to which it is appended. A proviso is added to a principal provision to which it is attached. It does not enlarge the enactment. In case the provision is repugnant to the enacting part, the proviso cannot prevail. Though in absolute terms of a later Act. Its placement has been considered, and purpose has been considered in the following decisions. It was observed in State of Rajasthan v. Leela Jain & Ors that131: “14. . . . So far as a general principle of construction of a proviso is concerned, it has been broadly stated that the function of a proviso is to limit the main part of the section and carve out something which but for the proviso would have been within the operative part. ….” (emphasis supplied) Similarly, this court in Sales-tax Officer, Circle 1, Jabalpur v. Hanuman Prasad132 stated that: E “5. …. It is well-recognised that a proviso is added to a principal clause primarily with the object of taking out of the scope of that principal clause what is included in it and what the Legislature desires should be excluded. ….” (emphasis supplied) F In Commissioner of Commercial Taxes, Board of Revenue, Madras and Anr. v. Ramkishan Shrikishan Jhaver etc 133 it was observed: “8. … Generally speaking, it is true that the proviso is an exception to the main part of the section; but it is recognised G that in exceptional cases a proviso may be a substantive provision itself. ….” (emphasis supplied) 131 1965 (1) SCR 276 132 1967 (1) SCR 831 133 H AIR (1968) SC 59

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191Copy pinpoint191. In S. Sundaram Pillai & Ors. v. V.R. Pattabiraman & A Ors134 , the scope of a proviso was clarified. The relevant discussion is quoted as under: “27. The next question that arises for consideration is as to what is the scope of a proviso and what is the ambit of an Explanation either to a proviso or to any other statutory provision. We shall first take up the question of the nature, scope and extent of a proviso. The well established rule of interpretation of a proviso is that a proviso may have three separate functions. Normally, a proviso is meant to be an exception to something within the main enactment or to qualify something enacted therein which but for the proviso would be within the purview of the enactment. In other words, a proviso cannot be torn apart from the main enactment nor can it be used to nullify or set at naught the real object of the main enactment.” *** D “29. Odgers in Construction of Deeds and Statutes (5th Edn.) while referring to the scope of a proviso mentioned the following ingredients: “P. 317. Provisos —These are clauses of exception or qualification in an Act, excepting something out of, or E qualifying something in, the enactment which, but for the proviso, would be within it. P. 318. Though framed as a proviso, such a clause may exceptionally have the effect of a substantive enactment.” F

30. Sarathi in Interpretation of Statutes at pages 294-295 has collected the following principles in regard to a proviso: (a) When one finds a proviso to a section the natural presumption is that, but for the proviso, the enacting part of the section would have included the subject-matter of the proviso. G (b) A proviso must be construed with reference to the preceding parts of the clause to which it is appended.

134 (1985) 1 SCC 591 H

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A (c) Where the proviso is directly repugnant to a section, the proviso shall stand and be held a repeal of the section as the proviso speaks the latter intention of the makers. (d) Where the section is doubtful, a proviso may be used as a guide to its interpretation: but when it is clear, a proviso cannot B imply the existence of words of which there is no trace in the section. (e) The proviso is subordinate to the main section. (f) A proviso does not enlarge an enactment except for compelling reasons. C (g) Sometimes an unnecessary proviso is inserted by way of abundant caution. (h) A construction placed upon a proviso which brings it into general harmony with the terms of section should prevail. D (i) When a proviso is repugnant to the enacting part, the proviso will not prevail over the absolute terms of a later Act directed to be read as supplemental to the earlier one. (j) A proviso may sometimes contain a substantive provision. *** E

35. A very apt description and extent of a proviso was given by Lord Loreburn in Rhondda Urban District Council v. Taff Vale Railway Co., 1909 AC 253, where it was pointed out that insertion of a proviso by the draftsman is not always strictly adhered to its legitimate use and at times a section worded as F a proviso may wholly or partly be in substance a fresh enactment adding to and not merely excepting something out of or qualifying what goes before. To the same effect is a later decision of the same Court in Jennings v. Kelly, 1940 AC 206, where it was observed thus: G “We must now come to the proviso, for there is, I think, no doubt that, in the construction of the section, the whole of it must be read, and a consistent meaning, if possible, given to every part of it. The words are:... ‘provided that such licence shall be granted only for premises situate in the ward or district electoral division in which such increase in population has

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taken place...’ There seems to be no doubt that the words “such increase in population” refer to the increase of not less than 25 per cent of the population mentioned in the opening words of the section.”

36. While interpreting a proviso care must be taken that it is used to remove special cases from the general enactment and provide for them separately.

37. In short, generally speaking, a proviso is intended to limit the enacted provision so as to except something which would have otherwise been within it or in some measure to modify the enacting clause. Sometimes a proviso may be embedded in the main provision and becomes an integral part of it so as to amount to a substantive provision itself. ***

43. We need not multiply authorities after authorities on this point because the legal position seems to be clearly and manifestly well established. To sum up, a proviso may serve four different purposes: (1) qualifying or excepting certain provisions from the main enactment: E (2) it may entirely change the very concept of the intendment of the enactment by insisting on certain mandatory conditions to be fulfilled in order to make the enactment workable: (3) it may be so embedded in the Act itself as to become an integral part of the enactment and thus acquire the tenor and F colour of the substantive enactment itself; and (4) it may be used merely to act as an optional addenda to the enactment with the sole object of explaining the real intendment of the statutory provision.” (emphasis supplied) G th

192Copy pinpoint192. Craies on Statute Law, 7 Edn., has observed, with respect to the construction of provisos thus: “The effect of an excepting or qualifying proviso, according to the ordinary rules of construction, is to except out of the H

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A preceding portion of the enactment, or to qualify something enacted therein, which but for the proviso would be within it; and such a proviso cannot be construed as enlarging the scope of an enactment when it can be fairly and properly construed without attributing to it that effect.” B (emphasis supplied) R. v. Dibdin, 1910 P 57 (CA), held as under: “The fallacy of the proposed method of interpretation is not far to seek. It sins against the fundamental rule of construction that a proviso must be considered with relation to the principal matter to which it stands as a proviso. It treats it as if it were an independent enacting clause instead of being dependent on the main enactment. The courts … have refused to be led astray by arguments such as those which have been addressed to us, which depend solely on taking words absolutely in their strict literal sense, disregarding the fundamental consideration that they are appearing in the proviso.” (emphasis supplied)

193Copy pinpoint193. Ishverlal Thakorelal Almaula v. Motibhai Nagjibhai135, E considered the effect of a proviso and said that its function is “to except or qualify something enacted in the substantive clause, which but for the proviso would be within that clause. It may ordinarily be presumed in construing a proviso that it was intended that the enacting part of the section would have included the subject-matter of the proviso.” Similar observations and considerations weighed in F Haryana State Cooperative Land Development Bank Ltd. v. Haryana State Cooperative Land Development Banks Employees Union & Anr.136 and other decisions noted below.137 In Subhaschandra Yograj Sinha (supra) it was observed that : 135 1966 (1) SCR 367 G 136 (2004) 1 SCC 574 137 Shimbhu & Anr. v. State of Haryana, (2014) 13 SCC 318; Kedarnath Jute Manufacturing Co. Ltd. v. The Commercial Tax Officer and Ors., 1965 (3) SCR 626. Shah Bhojraj Kuverji Oil Mills & Ginning Factory v. Subhash Chandra Yograj Sinha, AIR 1961 SC 1596; Dwarka Prasad v. Dwarka Das Saraf, 1976 (1) SCC 128; The Commissioner of Income-tax, Mysore, Travancore-Cochin and Coorg, Bangalore v. The Indo Mercantile Bank Ltd., 1959 (Supp 2) SCR 256 In Romesh Kumar Sharma v. H Union of India and Ors., (2006) 6 SCC 510.

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“(9) The law with regard to provisos is well settled and well understood. As a general rule, a proviso is added to an enactment to qualify or create an exception to what is in the enactment, and ordinarily, a proviso is not interpreted as stating a general rule. But, provisos are often added not as exceptions or qualifications to the main enactment but as savings clauses, in which cases they will not be construed as controlled by the section. The proviso which has been added to Section 50 of the Act deals with the effect of repeal. The substantive part of the section repealed two Acts which were in force in the State of Bombay. If nothing more had been said, Section 7 of the Bombay General clauses Act would have applied, and all pending suits and proceedings would have continued under the old law, as if the repealing Act had not been passed. The effect of the proviso was to take the matter out of Section 7 of the Bombay General Clauses Act and to provide for a special saving. It cannot be used to decide whether Section 12 of the Act is retrospective. It was observed by Wood, V.C., in Fitzgerald v. Champneys, (1861) 70 ER 958 that saving clauses are seldom used to construe Acts. These clauses are introduced into Acts which repeal others, to safeguard rights which, but for the savings, would be lost. The proviso here saves pending suits and proceedings, and further enacts that suits and proceedings then pending are to be transferred to the courts designated in the Act and are to continue under the Act and any or all the provisions of the Act are to apply to them. The learned Solicitor-General contends that the savings clause enacted by the proviso, even if treated as substantive law, must be taken to apply only to suits and proceedings pending at the time of the repeal which, but for the proviso, would be governed by the Act repealed. According to the learned Attorney-General, the effect of the savings is much wider, and it applies to such cases as come within the words of the proviso, whenever the Act is extended to new areas.” G (emphasis supplied)

194Copy pinpoint194. In Motiram Ghelabhai v. Jagan Nagar & Ors138, the view taken in Bhojraj (supra) was affirmed and applied. It was observed 138 (1985) 2 SCC 279 H

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A that provisos are often added not as exceptions or qualifications to the main enactment but as savings clauses, in which case they will not be construed as controlled by the section. In Madhu Gopal v. VI Additional District Judge & Ors.139 this Court has laid down that in any event, it is a well-settled principle of construction that unless clearly indicated, a proviso would not take away substantive rights given by the section or the sub-section. In The King v. Dominion Engineering Co. Ltd.140, it was held that where a section of an enactment contains two provisions and the second proviso is repugnant in any way to the first, the second proviso must prevail for it stands last in the enactment and speaks the last intention of the makers. The following observations were made: “(7) Proviso 2 qualifies the main enactment in the matter of delivery no less than does proviso 1 and it also qualifies proviso 1 itself. For it provides “further” that “in any case where there is no physical delivery of the goods,” the tax is to be payable when the property in the goods passes to the purchaser. Thus where there is no physical delivery the notional delivery which proviso 1 introduces is rendered inapplicable. Anger J. found in proviso 2 an alternative ground for his decision against the Crown and it is the main ground of Hudson J.’s judgment in the Supreme Court. In E their Lordships’ view this proviso presents an insuperable obstacle to the Crown’s claim. There has been no physical delivery of the goods by the Dominion Company to the Pulp Company. The proviso enacts that “in any case” where there has been no physical delivery the tax is to be payable when F the property passes. The property in the goods in question has never passed to the Pulp Company. Consequently the tax has nevern become payable. If proviso 2 is repugnant in any way to proviso 1 it must prevail for it stands last in the enactment and so to quote Lord Tenterden C.J., “speaks the last intention of the maker” ((1831), 2 B. & Ad. 818 at p.821). G The word is with the respondent, the Dominion Company, and must prevail.”

139 1988 (4) SCC 644 140 H AIR (34) 1947 PC 94

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195Copy pinpoint195. The proviso thus, is not foreign to compensation to be paid under section 24(2). It provides what is dealt with in Section 24(2) and takes to its logical conclusion, and provides for higher compensation, where there is and can be no lapsing of acquisition proceedings. The rule of construction- as is clear from the preceding case law discussed, is that the proviso should be limited in its operation to the subject-matter in a clause. A proviso is ordinarily a proviso and has to be harmoniously construed with the provisions. In our opinion, the proviso is capable of being harmoniously construed with Section 24(2) and not with section 24(1)(b), once we interpret the word ‘or’ as ‘nor’ in section 24(2).

196Copy pinpoint196. In keeping with the ratio in the aforesaid decisions, this court is of the considered view that the proviso cannot nullify the provision of C Section 24(1)(b) nor can it set at naught the real object of the enactment, but it can further by providing higher compensation, thus dealing with matters in Section 24 (2). Therefore, in effect, where award is not made [Section 24 (1)(a)] as well as where award is made but compensation is not deposited in respect of majority of the landowners in a notification D (for acquisition) [i.e. proviso to Section 24 (2)] compensation is payable in terms of the new Act, i.e., Act of 2013.

197Copy pinpoint197. For the aforesaid reasons, considering the placement of the proviso, semi-colon having been used at the end of section 24(2), considering the interpretation of section 24(1)(b) and the repugnancy which would be caused in case the proviso is lifted which is not permissible and particularly when we read the word ‘or’ as ‘nor’ in section 24(2), it has to be placed where the legislature has legislated it, it has not been wrongly placed as part of section 24(2) but is intended for beneficial results of higher compensation for one and all where there is no lapse, but amount not deposited as required. Higher compensation is contemplated by the Act of 2013, which intention is fully carried forward by the placement and interpretation. In re: What is the meaning to be given to the word “paid” used in section 24(2) and “deposited” used in the proviso to section 24(2) G

198Copy pinpoint198. Connected with this issue are questions like what is the consequence of payment not being made under section 31(1) and what are the consequences of amount not deposited under section 31(2). The provision of section 24(2) when it provides that compensation has not H

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A been paid where award has been made 5 years or more prior to the commencement of the Act of 2013. In contradistinction to that, the proviso uses the expression “an award has been made and compensation in respect of a majority of land holdings has not been deposited in the account of the beneficiaries”. We have to find out when an amount is required to be deposited under the Act of 1894 and how the payment is made under the Act of 1894. The provisions of Section 31 of the Act of 1894 are attracted to the interpretation of provisions of section 24(2) to find out the meaning of the words ‘paid’ and ‘deposited’. Section 31(1) makes it clear that on passing of award compensation has to be tendered to the beneficiaries and Collector shall pay it to them. The payment is provided only in section 31(1). The expression ‘tender’ and pay to them in section 31(1) cannot include the term ‘deposited.’

199Copy pinpoint199. Section 31 (2) of the Act of 1894 deals with deposit in case Collector is ‘prevented’ from making payment by one or more contingencies mentioned in section 31(2). The deposit follows if the D Collector is prevented from making payment. In case Collector is prevented from making payment due to contingencies such refusal to receive the amount, or if there be no person competent to alienate the land, or if there is a dispute as to the title to receive the compensation or as to the apportionment of it, he (i.e. the Collector) may withhold it or in case there is dispute as to apportionment, he may ask the parties to get E a decision from the Reference Court i.e., civil court and to clear the title. In such exigencies, the amount of compensation is required to be deposited in the court to which reference would be submitted under section 18. Section 31(2) requires deposit in case of reference under section 18 and not the reference, which may be sought under section 30 or section 28A F of the Act of 1894.

200Copy pinpoint200. Section 24(2) deals with the expression where compensation has not been paid. It would mean that it has not been tendered for payment under section 31(1). Though the word ‘paid’ amounts to a completed event however once payment of compensation has been G offered/tendered under section 31(1), the acquiring authority cannot be penalized for non-payment as the amount has remained unpaid due to refusal to accept, by the landowner and Collector is prevented from making the payment. Thus, the word ‘paid’ used in section 24(2) cannot be said to include within its ken ‘deposit’ under section 31(2). For that special provision has been carved out in the proviso to section 24(2), H

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which deals with the amount to be deposited in the account of beneficiaries. Two different expressions have been used in section 24. In the main part of section 24, the word ‘paid’ and in its proviso ‘deposited’ have been used.

201Copy pinpoint201. The consequence of non-deposit of the amount has been dealt with in section 34 of the Act of 1894. As per section 24(2), if the amount has not been paid nor possession has been taken, it provides for lapse. Whereas the proviso indicates amount has not been deposited with respect to a majority of land holdings in a case initiated under the Act of 1894 for 5 years or more. The period of five years need not have been specified in the proviso as it is part of section 24(2) and has to be read with it, particularly in view of the colon and placement by the legislature as held above. Two different consequences of non-deposit of compensation are: (i) higher compensation in a case where possession has been taken, payment has been made to some and amount has not been deposited with respect to majority of the holdings, (ii) in case there is no lapse, the beneficiaries would be entitled to interest as envisaged under section 34 from the date of taking possession at the rate of 9% per annum for the first year and after that @ 15% per annum.

202Copy pinpoint202. The word “paid” has been defined in the Oxford Dictionary to mean thus: “paid past and past participle of pay”; Give a sum of money thus owned.” Cambridge English Dictionary, defines “paid” as follows: “being given money for something.” P. Ramanatha Aiyar’s Advance Law Lexicon, 3rd Edition, 2005, F uses the following definition of “paid”: “applied; settled: satisfied.”

203Copy pinpoint203. The word “paid” in Section 31(1) to the landowner cannot include in its ambit the expression “deposited” in court. Deposit cannot be said to be payment made to landowners. Deposit is on being prevented G from payment. However, in case there is a tender of the amount that is to mean amount is made available to the landowner that would be a discharge of the obligation to make the payment and in that event such a person cannot be penalised for the default in making the payment. In default to deposit in court, the liability is to make the payment of interest H

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A under Section 34 of Act of 1894. Sections 32 and 33 (which had been relied upon by the landowners’ counsel to say that valuable rights inhere, in the event of deposit with court, thus making deposit under Section 31 mandatory) provide for investing amounts in the Government securities, or seeking alternative lands, in lieu of compensation, etc. Such deposits, cannot fetch higher interest than the15 per cent contemplated under B Section 34, which is pari materia to Section 80 of Act of 2013. Section 34 is pari materia to section 80 of Act of 2013 in which also the similar rate of interest has been specified. Even if the amount is not deposited in Reference Court nor with the treasury as against the name of the person interested who is entitled to receive it, if Collector has been prevented to C make the payment due to exigencies provided in Section 31(2), interest to be paid. However, in case the deposit is made without tendering it to the person interested, the liability to pay the interest under section 34, shall continue. Even assuming deposit in the Reference Court is taken to be mandatory, in that case too interest has to follow as specified in section

34. However, acquisition proceeding cannot lapse due to non-deposit. D

204Copy pinpoint204. The concept of “deposit” is different and quite apart from the word “paid”, due to which, lapse is provided in Section 24 of Act of

2013. In the case of non-deposit for the majority of landholdings, higher compensation would follow as such word “paid” cannot include in its ambit word “deposited”. To hold otherwise would be contrary to E provisions contained in Section 24(2) and its proviso carrying different consequences. It is provided in Section 34 of Act of 1894, in case payment has not been tendered or paid, nor deposited the interest has to be paid as specified therein. In Section 24(2) also lapse is provided in case amount has not been paid and possession has not been taken.

205Copy pinpoint205. In our considered opinion, there is a breach of obligation to deposit even if it is taken that amount to be deposited in the reference court in exigencies being prevented from payment as provided in Section 31(2). The default will not have the effect of reopening the concluded proceedings. The legal position and consequence which prevailed from G 1893 till 2013 on failure to deposit was only the liability for interest and all those transactions were never sought to be invalidated by the provisions contained in Section 24. It is only in the case where in a pending proceeding for a period of five years or more, the steps have not been taken for taking possession and for payment of compensation, then there is a lapse under section 24(2). In case amount has not been deposited H

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with respect to majority of land holdings, higher compensation has to A follow. Both lapse and higher compensation are qualified with the condition of period of 5 years or more.

206Copy pinpoint206. It was submitted that mere tender of amount is not payment. The amount has to be actually paid. In our opinion, when amount has been tendered, the obligation has been fulfilled by the Collector. B Landowners cannot be forced to receive it. In case a person has not accepted the amount wants to take the advantage of non-payment, though the amount has remained due to his own act. It is not open to him to contend that amount has not been paid to him, as such, there should be lapse of the proceedings. Even in a case when offer for payment has been made but not deposited, liability to pay amount along with interest subsist and if not deposited for majority of holding, for that adequate provisions have been given in the proviso also to Section 24(2). The scheme of the Act of 2013 in Sections 77 and 80 is also the same as that provided in Sections 31 and 34 of the Act of 1894.

207Copy pinpoint207. It was urged that landowners can seek investment in an interest bearing account, there is no doubt about that investment can be sought from the court under Sections 32 and 33 of Act of 1894, but interest in Government securities is not more than what is provided in section 34 at the rate of 9 percent from the date of taking possession for one year and thereafter, at the rate of 15 percent. We take judicial notice of the fact in no other Government security rate of interest is higher on the amount being invested under sections 32 and 33 of the Act of 1894. Higher rate of interest is available under section 34 to the advantage of landowners. It was submitted that in case the amount is deposited in the court, it is on behalf of the beneficiary. The submission overlooks the form in which it used to be deposited in the treasury too, that amount is also credited in the treasury payable to the beneficiary specified in his name with land details, date of award, etc.

208Copy pinpoint208. There is another reason why this court holds that such an interpretation is reasonable and in tune with Parliamentary intent. Under the old regime, it was open to the Collector to fix a convenient date or dates for announcement of award, and tender payment. In the event of refusal by the landowner to receive, or in other cases, such as absence of the true owner, or in case of dispute as to who was to receive it, no doubt, the statute provided that the amount was to be deposited with the court: as it does today, under Section 77. Yet, neither during the time H

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A when the Act of 1894 was in operation, nor under the Act of 2013, the entire acquisition does not lapse for non-deposit of the compensation amount in court. This is a significant aspect which none of the previous decisions have noticed. Thus, it would be incorrect to imply that failure to deposit compensation [in court, under Section 31 (2)] would entail lapse, if the amounts have not been paid for five years or more prior to the coming into force of the Act of 2013. Such an interpretation would lead to retrospective operation, of a provision, and the nullification of acquisition proceedings, long completed, by imposition of a norm or standard, and its application for a time when it did not exist.

209Copy pinpoint209. If the expression “deposited” is held to be included in the expression “paid” used in Section 24(2) of the Act of 2013, inconsistency and repugnancy would be caused as between the proviso and the main sub-section, which has to be avoided and the non-compliance of the provisions of Section 31(2) is not fatal. Even if the amount has not been deposited, higher compensation has to follow in the exigency proviso to D Section 24(2).

210Copy pinpoint210. In Black’s Law Dictionary, the word “tender” has been defined to mean thus: “tender, n. (16c) 1. A valid and sufficient offer of performance; specific, an unconditional offer of money or E performance to satisfy a debt or obligation a tender of delivery. The tender may save the tendering party from a penalty for non-payment or non-performance or may, if the other party unjustifiably refuses the tender, place the other party in default. Cf. OFFER OR F PERFORMANCE; CONSIGNATION.”

211Copy pinpoint211. It is apparent that “tender” of the amount saves the party tendering it from the consequence to be visited on non-payment of the amount. The obligation to make the payment has been considered in various other laws and decisions. When obligation to payment is fulfilled G as to the scheme in the context of a particular act, for that purpose, decisions under various other laws are relevant and cannot be said to be irrelevant.

212Copy pinpoint212. In The Straw Board Manufacturing Co. Ltd., Saharanpur v. Gobind141 , this Court considered the provisions requiring payment of 141 H 1962 (Supp 3) SCR 318

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one month’s wage under Section 33 of Industrial Disputes Act for making A a valid discharge or dismissal. This Court has held that the employer has tendered the wages and that would amount for payment, otherwise a workman can make the provision unworkable by refusing to take the wages. This Court has observed thus: “(8) Let us now turn to the words of the proviso in the background of what we have said above. The proviso lays down that no workman shall be discharged or dismissed unless he has been paid wages for one month and an application has been made by the employer to the authority before which the proceeding is pending for approval of the action taken by the employer. It will be clear that two kinds of punishment are subject to the conditions of the proviso, namely, discharge or dismissal. Any other kind of punishment is not within the proviso. Further the proviso lays down two conditions, namely, (i) payment of wages for one month and (ii) making of an application by the employer to the authority before which the proceeding is pending for approval of the action taken. It is not disputed before us that when the proviso lays down the conditions as to payment of one month’s wages, all that the employer is required to do in order to carry out that condition is to tender the wages to the employee. But if the employee chooses not to accept the wages he cannot come forward and say that there has been no payment of wages to him by the employer. Therefore, though S. 33 speaks of payment of one month’s wages it can only mean that the employer has tendered the wages and that would amount to payment, for otherwise a F workman could always make the section unworkable by refusing to take the wages. So far as the second condition about the making of the application is concerned, the proviso requires that the application should be made for approval of the action taken by the employer.” G (emphasis supplied)

213Copy pinpoint213. In The Management of Delhi Transport Undertaking v. The Industrial Tribunal, Delhi & Anr142, a three-Judge Bench of this Court has laid down the law to the similar effect. It is not actual payment, 142 1965 (1) SCR 998 H

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A but tender of amount which is necessary to fulfil obligation to pay. This Court observed thus: “4. …The proviso does not mean that the wages for one month should have been actually paid, because in many cases the employer can only tender the amount before the dismissal but B cannot force the employee to receive the payment before dismissal becomes effective. In this case the tender was definitely made before the order of dismissal became effective and the wages would certainly have been paid if Hari Chand had asked for them. There was no failure to comply with the provision in this respect.” C (emphasis supplied)

214Copy pinpoint214. In Indian Oxygen Ltd. v. Narayan Bhoumik143, it was held that the “the condition as to payment in the proviso does not mean that wages have to be actually paid but if wages are tendered or offered, such a tender or offer would be sufficient compliance” with the statute. The Benares State Bank Ltd. v. The Commissioner of Income Tax, Lucknow144, was decided in the context of Section 14(2)(c) of the Income Tax Act, 1922. It was observed that “paid” under Section 16 does not contemplate actual receipt of the dividend by the Member of the community. It is to be made unconditionally available to the members entitled to it. It observed thus: “5. …This Court observed in J. Dalmia v. Commissioner of Income-tax, Delhi, 53 ITR 83 that the expression “paid” in Section 16(2) does not contemplate actual receipt of the dividend by the member: in general, dividend may be said to be paid within the meaning of Section 16(2) when the company discharges its liability and makes the amount of dividend unconditionally available to the member entitled thereto. …”

215Copy pinpoint215. Two different expressions have been used in Section 24(2). The expression “paid” has been used in Section 24(2) and whereas in the proviso “deposited” has been used. “Paid” cannot include “deposit”, or else Parliament would have used different expressions in the main sub-section and its proviso, if the meaning were to be the same. The Court cannot add or subtract any word in the statute and has to give 143 (1968) 1 PLJR 94 144 H (1969) 2 SCC 316

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plain and literal meaning and when compensation has not been paid under A Section 24(2), it cannot mean compensation has not been deposited as used in the proviso. While interpreting the statutory provisions, addition or subtraction in the legislation is not permissible. It is not open to the court to either add or subtract a word. There cannot be any departure from the words of law, as observed in legal maxim “A Verbis Legis Non B Est Recedendum”. In Principles of Statutory Interpretation (14th Edition) by Justice G.P. Singh, plethora of decisions have been referred. There is a conscious omission of the word “deposit” in Section 24(2), which has been used in the proviso. Parliament cannot be said to have used the different words carrying the same meaning in the same provision, whereas words “paid” and “deposited” carry a totally different meaning. Payment C is actually made to the landowner and deposit is made in the court, that is not the payment made to the landowner. It may be discharge of liability of payment of interest and not more than that. Applying the rule of literal construction also natural, ordinary and popular meaning of the words “paid” and “deposited” do not carry the same meaning; the natural and grammatical meaning has to be given to them, as observed in Principles of Statutory Interpretation by Justice G.P. Singh (at page 91) thus: “… Natural and grammatical meaning. The words of a statute are first understood in their natural, ordinary or popular sense and phrases and sentences are construed according to their grammatical meaning, unless that leads to some absurdity or unless there is something in the context, or in the object of the statute to suggest the contrary.” “The true way”, according to LORD BROUGHAM is, “to take the words as the Legislature have given them, and to take the meaning which the words given naturally imply, unless where the construction of those Words is, either by the preamble or by the context of the words in question, controlled or alter “; and in the words of VISCOUNT HALDANE, L.C., if the language used “has a natural meaning we cannot depart from that meaning unless reading the statute as a whole, the context directs us to do so. In an oft-quoted passage, LORD WENSLEYDALE stated the Rule thus: “In construing wills and indeed statutes and all written instruments, the grammatical and ordinary sense of the word is adhered to, unless that would lead to some absurdity, or some repugnance or inconsistency with the rest of the instrument in which case the grammatical and ordinary H

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A sense of the words may be modified, so as to avoid that absurdity, and inconsistency, but no further”. And stated LORD ATKINSON: “In the construction of statutes, their words must be interpreted in their ordinary grammatical sense unless there be something in the context, or in the object of the statute in which they occur or in the circumstances in which they are used, to show that they were used in a special sense different from their ordinary grammatical sense”. 28 VISCOUNT SIMON, L.C., said: “The golden Rule is that the words of a statute must prima facie be given their ordinary meaning”. Natural and ordinary meaning of words should not be departed from “unless it can be shown that the legal context in which the words are used requires a different meaning”. Such a meaning cannot be departed from by the judges “in the light of their own views as to policy” although they can “adopt a purposive interpretation if they can find in the statute read as a whole or in material to which they are permitted by law to refer as aids to interpretation an expression of Parliament’s purpose or policy”. For a modern statement of the rule, one may refer to the speech of LORD SIMON OF GLAISDALE in a case where he said: “Parliament is prima facie to be credited with meaning what is said in an Act E of Parliament. The drafting of statutes, so important to a people who hope to live under the Rule of law, will never be satisfactory unless courts seek whenever possible to apply ’the golden rule’ of construction, that is to read the statutory language, grammatically and terminologically, in the ordinary and primary sense which it bears in its context, without omission or addition. Of course, Parliament is to be credited with good sense; so that when such an approach produces injustice, absurdity, contradiction or stultification of statutory objective the language may be modified sufficiently to avoid such disadvantage, though no further”. The Rules stated above have been quoted with approval by the Supreme Court.......” (emphasis supplied)

216Copy pinpoint216. The same work also notes that when two different expressions are used in the same provision of a statute, there is a presumption that H

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they are not used in the same sense. The following passage is relevant A (Principles of Statutory Interpretation by Justice G.P. Singh at page 395): “.......When in relation to the same subject matter, different words are used in the same statute, there is a presumption that they are not used in the same sense. B In construing the words ‘distinct matters’ occurring in Section 5 of the Stamp Act, 1899, and in concluding that these words have not the same meaning as the words ‘two or more of the descriptions in Schedule I’ occurring in Section 6, VENKATARAMA AIYAR, J., observed: “When two words of different import are used in a statute in two consecutive provisions, it would be difficult to maintain that they are used in the same sense.” Similarly, while construing the word ‘gain’ Under Section 3(ff) of the Bombay Municipal Corporation Act, 1888, which used the words ‘profit or gain’, the Supreme Court relied on the dictionary meanings of the words to hold that the word ‘gain’ is not synonymous with the word ‘profit’ as it is not restricted to pecuniary or commercial profits, and that any advantage or benefit acquired or value addition made by some activities would amount to ‘gain’.......” E ***14. Brighton Parish Guardians v. Strand Union Guardians, (1891) 2 QB 156, p. 167 (CA); Member, Board of Revenue v. Arthur Paul Benthall AIR 1956 SC 35, p. 38 : 1955 (2) SCR 842; CIT v. East West Import & Export (P.) Ltd., Jaipur AIR 1989 SC 836, p. 838 : (1989) 1 SCC 760; B.R. F Enterprises v. State of U.P. AIR 1999 SC 1867, p. 1902: (1999) 9 SCC 700 (‘trade and business’ in Article 298 have different meaning from ‘trade and commerce’ in Article 301); ShriIshal Alloy Steels Ltd. v. JayaswalasNeco Ltd., JT 2001 (3) SC 114, p. 119: (2001) 3 SCC 609 : AIR 2001 SC 1161 (The words ‘a bank’ and ‘the bank’ in Section 138 N.I. Act, 1881 do not G have the same meaning); The Oriental Insurance Co. Ltd. V. Hansrajbhai v. Kodala AIR 2001 SC 1832, p. 1842 : (2001) 5 SCC 175; Kailash Nath Agarwal v. Pradeshiya Indust and Inv. Corporation of U.P., 2003 AIR SCW 1358, p. 1365: (2003) 4 SCC 305, p. 313. (The words ‘proceeding’ and ‘suit’ H

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A used in the same Section construed differently); But in Paramjeet Singh Pathak v. ICDS Ltd., (2006) 13 SCC 322: AIR 2007 SC 168 different view was taken therefore in Zenith Steel Tubes v. Sicom Ltd., (2008) 1 SCC 533: AIR 2008 SC 451 case referred to a larger Bench; D.L.F. Qutab Enclave Complex Educational Charitable Trust v. State of Haryana, B 2003 AIR SCW 1046, p. 1057: AIR 2003 SC 1648 : (2003) 5 SCC 622 (The expressions ‘at his own cost’ and ‘at its cost,’ used in one Section given different meanings)”

217Copy pinpoint217. In Privy Council decisions in Crawford v. Spooner145 and Lord Howard de Walden v. IRC & Anr146 following observations have C been made: “… we cannot aid the legislature’s defective phrasing of an Act, we cannot add or mend and, by construction, makeup deficiencies which are left there. D … It is contrary to all rules of construction to read words into an Act unless it is necessary to do so. Similarly, it is wrong and dangerous to proceed by substituting some other words for words of the statute. Speaking briefly the court cannot reframe the legislation for the very good reason that it has no power to legislate.”

218Copy pinpoint218. In V.L.S. Finance Ltd. (supra) this Court observed that: “17. Ordinarily, the offence is compounded under the provisions of the Code of Criminal Procedure and the power to accord permission is conferred on the court excepting those offences for which the permission is not required. However, in view of the non-obstante clause, the power of composition can be exercised by the court or the Company Law Board. The legislature has conferred the same power on the Company Law Board which can exercise its power either before or after the institution of any prosecution whereas the criminal court has no power to accord permission for composition of an offence before the institution of the proceeding. The legislature in its wisdom has not put the rider of prior permission of the 145 (1846) 6 Moore PC 1 H 146 (1948) 2 AER 825

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court before compounding the offence by the Company Law A Board and in case the contention of the appellant is accepted, same would amount to addition of the words “with the prior permission of the court” in the Act, which is not permissible.

18. As is well settled, while interpreting the provisions of a statute, the court avoids rejection or addition of words and resorts to that only in exceptional circumstances to achieve the purpose of the Act or give purposeful meaning. It is also a cardinal rule of interpretation that words, phrases, and sentences are to be given their natural, plain, and clear meaning. When the language is clear and unambiguous, it must be interpreted in an ordinary sense, and no addition or alteration of the words or expressions used is permissible. As observed earlier, the aforesaid enactment was brought in view of the need of leniency in the administration of the Act because a large number of defaults are of technical nature, and many defaults occurred because of the complex nature of the provision. (emphasis supplied)

219Copy pinpoint219. In Bharat Aluminium Company v. Kaiser Aluminium Technical Services Inc.147 , this Court observed thus: E “65. Mr. Sorabjee has also rightly pointed out the observations made by Lord Diplock in Duport Steels Ltd. v. Sirs, (1980) 1 WLR 142. In the aforesaid judgment, the House of Lords disapproved the approach adopted by the Court of Appeal in discerning the intention of the legislature; it is observed that: (WLR p. 157 C-D) F “… the role of the judiciary is confined to ascertaining from the words that Parliament has approved as expressing its intention what that intention was, and to giving effect to it. Where the meaning of the statutory words is plain and unambiguous, it is not for the Judges to invent fancied G ambiguities as an excuse for failing to give effect to its plain meaning because they themselves consider that the consequences of doing so would be inexpedient, or even unjust or immoral. In controversial matters such as are 147 (2012) 9 SCC 552 H

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A involved in industrial relations, there is room for differences of opinion as to what is expedient, what is just and what is morally justifiable. Under our Constitution it is Parliament’s opinion on these matters that is paramount.” (emphasis supplied) B In the same judgment, it is further observed: (WLR p. 157 F) “… But if this be the case it is for Parliament, not for the judiciary, to decide whether any changes should be made to the law as stated in the Acts….”

C (emphasis supplied) ***

67. We are unable to accept the submission of the learned counsel for the appellants that the omission of the word “only” from Section 2(2) indicates that applicability of Part I of the D Arbitration Act, 1996 is not limited to the arbitrations that take place in India. We are also unable to accept that Section 2(2) would make Part I applicable even to arbitrations which take place outside India. In our opinion, a plain reading of Section 2(2) makes it clear that Part I is limited in its application to arbitrations which take place in India. We are in agreement with the submissions made by the learned counsel for the respondents, and the interveners in support of the respondents, that Parliament by limiting the applicability of Part I to arbitrations which take place in India has expressed a legislative declaration. It has clearly given recognition to the territorial principle. Necessarily therefore, it has enacted that Part I of the Arbitration Act, 1996 applies to arbitrations having their place/seat in India. ***

82. Another strong reason for rejecting the submission made by the learned counsel for the appellants is that if Part I were to be applicable to arbitrations seated in foreign countries, certain words would have to be added to Section 2(2). The section would have to provide that “this part shall apply where the place of arbitration is in India and to arbitrations having its place out of India.” Apart from being contrary to the

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contextual intent and object of Section 2(2), such an interpretation would amount to a drastic and unwarranted rewriting/alteration of the language of Section 2(2). As very strongly advocated by Mr Sorabjee, the provisions in the Arbitration Act, 1996 must be construed by their plain language/terms. It is not permissible for the court while construing a provision to reconstruct the provision. In other words, the court cannot produce a new jacket, whilst ironing out the creases of the old one. In view of the aforesaid, we are unable to support the conclusions recorded by this Court as noticed earlier.” (emphasis supplied) C

220Copy pinpoint220. In Harbhajan Singh (supra) the following observations were made: “7. …. Ordinary, grammatical and full meaning is to be assigned to the words used while interpreting a provision to D honour the rule — the legislature chooses appropriate words to express what it intends, and therefore, must be attributed with such intention as is conveyed by the words employed so long as this does not result in absurdity or anomaly or unless material — intrinsic or external — is available to permit a departure from the rule.” E

(emphasis supplied)

221Copy pinpoint221. In The Member, Board of Revenue v. Arthur Paul Benthall148 this Court held as under: “4. We are unable to accept the contention that the word F “matter” in S. 5 was intended to convey the same meaning as the word “description” in S. 6. In its popular sense, the expression “distinct matters” would connote something different from distinct “categories”. Two transactions might be of the same description, but all the same, they might be G distinct. If A sells Black-acre to X and mortgages White-acre to Y, the transactions fall under different categories, and they are also distinct matters. But if mortgages Black-acre to X and 148 1955 (2) SCR 842 H

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A mortgages White-acre to Y, the two transactions fall under the same category, but they would certainly be distinct matters. If the intention of the legislature was that the expression ‘distinct matters’ in S. 5 should be understood not in its popular sense but narrowly as meaning different categories in the Schedule, nothing would have been easier than to say so. When two words of different import are used in a statute in two consecutive provisions, it would be difficult to maintain that they are used in the same sense, and the conclusion must follow that the expression “distinct matters” in S. 5 and “descriptions” in section 6 have different connotations.”

C (emphasis supplied)

222Copy pinpoint222. In Commissioner of Income Tax, New Delhi v. M/s. East West Import and Export (P) Ltd149, it was observed as under: “7. The Explanation has reference to the point of time at two places: the first one has been stated as “at the end of the previous year” and the second, which is in issue, is “in the course of such previous year”. Counsel for the revenue has emphasised upon the feature that in the same Explanation reference to time has been expressed differently and if the legislative intention was not to distinguish and while stating “in the course of such previous year” it was intended to convey the idea of the last day of the previous year, there would have been no necessity of expressing the position differently. There is abundant authority to support the stand of the counsel for the revenue that when the situation has been differently expressed the legislature must be taken to have intended to express a different intention.” F (emphasis supplied) Several other decisions have reiterated the same proposition, i.e that when the legislature uses two different expressions in the same statute, they must be given different meanings, to carry out legislative intent.150 149 (1989) 1 SCC 760 150 B.R. Enterprises v. State of U.P. and Ors., (1999) 9 SCC 700; Kailash Nath Agarwal and Ors. v. Pradeshiya Industrial & Investment Corporation of U.P. Ltd. and Anr., (2003) 4 SCC 305 (which interpreted “proceeding” and “suit” differently; In DLF Qutab Enclave Complex Educational Charitable Trust v. State of Haryana and Ors., (2003) 5 SCC 622 (where “at his cost” and “at its cost” were interpreted to mean different situations.

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223Copy pinpoint223. The land owners had argued that the obligation to pay gets discharged only when compensation is actually paid and/or deposited. Even if it is received under protest under Section 31(1), it is finally accepted by the landowners post-settlement by the Reference Court. We are not able to accept the submission as Section 34 of the Act of 1894, is clear even if the amount is not paid or deposited, it carries interest. The logic behind this is that if the State is retaining the amount with peace and its liability to pay does not cease, but it would be liable to make the payment with interest as envisaged therein. Once tender is made, obligation to pay is fulfilled so that the amount cannot be said to have been paid, but obligation to pay has been discharged and if a person who has not accepted it, cannot penalise the other party for default to pay and non-deposit carries only interest as money had been retained with the Government.

224Copy pinpoint224. Thus, in our opinion, the word “paid” used in Section 24(2) does not include within its meaning the word “deposited”, which has been used in the proviso to Section 24(2). Section 31 of the Act of 1894, D deals with the deposit as envisaged in Section 31(2) on being ‘prevented’ from making the payment even if the amount has been deposited in the treasury under the Rules framed under Section 55 or under the Standing Orders, that would carry the interest as envisaged under Section 34, but acquisition would not lapse on such deposit being made in the treasury. In case amount has been tendered and the landowner has refused to receive it, it cannot be said that the liability arising from non-payment of the amount is that of lapse of acquisition. Interest would follow in such a case also due to non-deposit of the amount. Equally, when the landowner does not accept the amount, but seeks a reference for higher compensation, there can be no question of such individual stating that he was not paid the amount (he was determined to be entitled to by the collector). In such case, the landowner would be entitled to the compensation determined by the Reference court. In re: Rules framed under Section 55 and the Standing Orders issued by State Governments G

225Copy pinpoint225. It was urged on behalf of acquiring Authorities that various State Governments have framed rules under Section 55 of the Act of 1894 and/or have issued the Standing Orders/instructions with respect to the Government money under Article 283 of the Constitution of India. These Standing Orders and Rules have remained in force from time immemorial; their provisions require the amount to be tendered, notice H

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A to be issued to the landowners to collect the amount of compensation awarded to them. If they do not appear and apply to the reference under Section 18, the officer shall cause the amounts due to be paid into the treasury as revenue deposits payable to the persons to whom they are respectively due and vouched for in the accompanying form (marked E). When the payee ultimately claims the payment, they shall be paid in the same manner as ordinary revenue deposits. The Land Acquisition (Bihar and Orissa) Rules were framed under Section 55 of the Act of

1894. Rule 10 thereof is extracted hereunder: “10. In giving notice of the award under Section 12(2) and tendering payment Under Section 31(1), to such of the persons interested as were not present personally or by their representatives when the award was made, the officer shall require them to appear personally or by representatives by a certain date to receive payment of the compensation awarded to them, intimating also that no interest will be allowed to them if they fail to appear. If they do not appear, and do not apply for reference to the Civil Court Under Section 18, the officer shall after any further endeavour to secure their attendance that may seem desirable, cause the amounts due to be paid into the Treasury as Revenue deposits payable to the persons to whom they are respectively due and vouched for in the accompanying form (marked E). The officer shall also give notice to the payees of such deposits, the Treasury in which the deposits specifying have been made. When the payees ultimately claim payment of sums placed in deposit, the amounts will be paid to them in the same manner as ordinary revenue deposits. The officer should, as far as possible, arrange to make the payments due in or near the village to which the payees belong, in order that the number of undisbursed sums to be placed in deposit on account of non-attendance may be reduced to a minimum. Whenever payment is claimed through a representative whether before or after deposit of the amount awarded, such representative, must show legal authority for receiving the compensation on behalf of his principal.” (emphasis supplied)

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226Copy pinpoint226. In the State of Assam, rules have also been framed under A Section 55 of the Act of 1894, dealing with the deposit. Rule 9 provides that in case reference is not sought under Section 18, the amount has to be deposited in treasury. Rule 9 is extracted hereunder: “9. In giving notice of the award Under Section 12(2) and tendering payment Under Section 31(1), to such of the persons interested as were not present personally or by their representatives when the award was made, the Collector shall require them to appear personally or by representatives by a certain date, to receive payment of the compensation awarded to them intimating also that no interest will be allowed to them, if they fail to appear. If they do not appear and do not apply for a reference to the Civil Court Under Section 18, he shall, after any further endeavour to secure their attendance or make payment that may seem desirable, cause the amounts due to be paid into the WW as revenue deposits payable to the persons to whom they are respectively due, and vouched for in the form prescribed or approved by Government from time to time. He shall also give notice to the payees of such deposits, specifying the Treasury in which the deposits have been made. When the payees ultimately claim payment of sums placed in deposit, the amount will be paid to them in the same manner as ordinary revenue deposits. The Collector should, as far as possible, arrange to make the payment due in or near the village to which the land pertains in order that the number of undisbursed sum to be placed in deposit on account of nonattendance may be reduced to a minimum. Whenever payment is claimed through a representative, such representative, must show legal authority for receiving the compensation on behalf of the principal.” (emphasis supplied)

227Copy pinpoint227. In the State of Karnataka too similar rules were framed in 1965 under Section 55 of the Act of 1894. Similarly, in the State of G Kerala also Rule 14(2) of the Land Acquisition (Kerala) Rules, 1990 were framed under Section 55 of the Act of 1894, provided that payment relating to award shall be made or the amount shall be credited to the court or revenue deposit (treasury) within one month from the date of the award. Similar rules were framed in the State of Bihar and Orissa. H

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228Copy pinpoint228. Standing Order No.28 was issued in 1909 by the State of Punjab and was applicable to Delhi also, which provided five modes of payment in para 74 and 75 thus: “74. Methods of making payments.—There are five methods of making payments: B (1) By direct payments, see Para 75(I) infra (2) By order on treasury, see Para 75(II) infra (3) By money order, see Para 75(III) infra (4) By cheque, see Para 75(IV) infra C (5) By deposit in a treasury, see Para 75(V) infra

75. Direct payments.— * * * (V) By treasury deposit.— In giving notice of the award under D Section 12(2) and tendering payment under Section 31(1) to such of the persons interested as were not present personally or by their representatives when the award was made, the officer shall require them to appear personally or by representatives by a certain date to receive payment of the compensation awarded to them, intimating also that no interest will be allowed to them if they fail to appear, if they do not appear and do not apply for a reference to the civil court under Section 18, the officer shall after any further endeavours to secure their attendance that may seem desirable, cause the amounts due to be paid to the treasury as revenue deposits payable to the persons to whom they are respectively due and vouched for in the form marked E below. The officer shall also give notice to the payees of such deposits, specifying the treasury in which the deposit has been made. When the payees ultimately claim payment of sums G placed in deposit, the amounts will be paid to them in the same manner as ordinary revenue deposit. The officer should, as far as possible, arrange to make the payments due in or near the village to which the payee belong in order that the number of undisbursed sums to be placed in deposits on account of non-attendance may be reduced to a minimum. H

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Whenever payment is claimed through a representative A whether before or after deposit of the amount awarded, such representative, must have legal authority for receiving the compensation on behalf of his principal.”

Sub-para (V) of the above made it clear that payment is credited to the treasury when a person who is served with a notice under Section 12(2) of the Act of 1894, is not present and the award is passed. When a notice is given to receive the payment of compensation and in case they fail to appear, the amount has to be paid to the treasury as revenue deposit payable to the landowner.

229Copy pinpoint229. Rules and the Standing Orders are binding on the concerned Authorities and they have to follow them. They deposit the amounts in court only when a reference (for higher compensation) is sought, not otherwise. Even if a person refuses to accept it and the amount is deposited in court or even it is not tendered, only higher interest follows under Section 34. Once Rules have prevailed since long and even if it is assumed that deposit in court is mandatory on being prevented from payment as envisaged under Section 31(1), the only liability to make the H

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A payment of higher interest is fastened upon the State. The liability to pay the amount with interest would subsist. When amounts are deposited in court, there would occur a procedural irregularity and the adverse consequence envisaged is under Section 34 of the Act of 1894. The consequence of non-deposit in the court is that the amount of the landowner cannot be invested in the Government securities as envisaged under Sections 32 and 33 of the Act of 1894, in which interest is not more 15 per cent. Thus, no prejudice is caused to the landowners rather they stand to gain and still payment is safe as it is kept in the court. We have already held that there is a distinction between the expression “paid” and “deposited”, thus the amount being deposited as per Rules in the treasury or as per the Standing Orders considering the scheme of Section 31 read with Section 34 of the Act of 1894, which are pari materia to Sections 77 and 80 of the Act of 2013. We are of the considered opinion that acquisition cannot be invalidated, only higher compensation would follow in case amount has not been deposited with respect to majority of land holdings, all the beneficiaries would be entitled for higher compensation as envisaged in the proviso to Section 24(2).

230Copy pinpoint230. Deposit in treasury in place of deposit in court causes no prejudice to the landowner or any other stakeholder as their interest is adequately safeguarded by the provisions contained in Section 34 of the Act of 1894, as it ensures higher rate of interest than any other E Government securities. Their money is safe and credited in the earmarked quantified amount and can be made available for disbursement to him/ them. There is no prejudice caused and every infraction of law would not vitiate the act.

231Copy pinpoint231. In Jankinath Sarangi v. State of Orissa 151, this Court F observed that every infraction of law would not vitiate the act. It has further been observed that test is actual prejudice has been caused to a person by the supposed denial to him of a particular right. Following observations have been made: “5. From this material it is argued that the principles of natural G justice were violated because the right of the appellant to have his own evidence recorded was denied to him and further that the material which was gathered behind his back was used in determining his guilt. In support of these contentions a number of rulings are cited chief among which are State of H 151 (1969) 3 SCC 392

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Bombay v. Narul Latif Khan, (1965) 3 SCR 135; State of Uttar A Pradesh v. Sri C.S. Sharma, (1967) 3 SCR 848 and Union of India v. T.R. Varma, (1958) SCR 499. There is no doubt that if the principles of natural justice are violated, and there is a gross case, this Court would interfere by striking down the order of dismissal, but there are cases and cases. We have to B look to what actual prejudice has been caused to a person by the supposed denial to him of a particular right. Here the question was a simple one, viz. whether the measurement book prepared for the contract work had been properly scrutinised and checked by the appellant or not. He did the checking in March 1954 and immediately thereafter in May 1954 the C Executive Engineer re-checked the measurements and found that the previous checking had not been done properly. Between March and May there could not be much rainfall, if at all, and the marks of digging according to the witnesses could not be obliterated during that time. It is however said D that at the 6th and 7th mile the checking was done in July and by that time rains might have set in. Even so the witnesses at the sites of the pits could not be so considerably altered as to present a totally wrong picture. If anything had happened the earth would have swollen rather than contracted by reason of rain and the pits would have become bigger and not smaller. E Anyway the questions which were put to the witnesses were recorded and sent to the Chief Engineer and his replies were received. No doubt the replies were not put in the hands of the appellant but he saw them at the time when he was making the representations and curiously enough he used those replies in his defence. In other words, they were not collected behind his back and could be used to his advantage and he had an opportunity of so using them in his defence. We do not think that any prejudice was caused to the appellant in this case by not examining the two retired Superintending Engineers whom he had cited or any one of them. The case was a simple one whether the measurement book had been properly checked. The pleas about rain and floods were utterly useless and the Chief Engineer’s elucidated replies were not against the appellant. In these circumstances a fetish of the principles of natural justice is not necessary to be made. We do not think H

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A that a case is made out that the principles of natural justice are violated. The appeal must fail and is accordingly dismissed, but we will make no order as to costs.” (emphasis supplied)

232Copy pinpoint232. In Sunil Kumar Banerjee v. State of West Bengal and B Ors.,152 the Court observed: “3. There is no substance in the contention of the appellant that the 1955 Rules and not the 1969 Rules were followed. As pointed out by the High Court, in the charges framed against the appellant and in the first show cause notice the reference was clearly to the 1969 Rules. The appellant himself mentioned in one of his letters that the charges have been framed under the 1969 Rules. The enquiry report mentions that Shri Mukherjee was appointed as an Enquiry Officer under the 1969 Rules. It is, however true that the appellant was not questioned by the Enquiry Officer under Rule 8(19) which provided as follows: “The enquiring authority may, after the member of the services closes his case and shall if the member of the service has not examined himself generally question him on the circumstances appearing against him in the evidence for the purpose of enabling the member of the service to explain any circumstances appearing in the evidence against him.” It may be noticed straight away that this provision is akin to Section 342 of the Criminal Procedure Code of 1898 and F Section 313 of the Criminal Procedure Code of 1973. It is now well established that mere non-examination or defective examination under Section 342 of the 1898 Code is not a ground for interference unless prejudice is established, vide, K.C. Mathew v. State of Travancore-Cochin, AIR 1956 SC 24; Bibhuti Bhusan Das Gupta v. State of W.B., AIR 1969 SC G 381 We are similarly of the view that failure to comply with the requirements of Rule 8(19) of the 1969 Rules does not vitiate the enquiry unless the delinquent officer is able to establish prejudice. In this case the learned Single Judge the High Court as well as the learned Judges of the Division Bench H 152 (1980) 3 SCC 304

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found that the appellant was in no way prejudiced by the failure to observe the requirement of Rule 8(19). The appellant cross-examined the witnesses himself, submitted his defence in writing in great detail and argued the case himself at all stages. The appellant was fully alive to the allegations against him and dealt with all aspects of the allegations in his written defence. We do not think that he was in the least prejudiced by the failure of the Enquiry Officer to question him in accordance with Rule 8(19). (emphasis supplied)” A similar view has been taken in the State of Andhra Pradesh v. C Thakkidiram Reddy153 and other decisions.

233Copy pinpoint233. There is a dual obligation, namely, part mandatory and part directory. In Howard v. Secretary of State for the Environment, (1975) Q.B. 235, Lord Denning has cited a portion from the speech of Lord Penzance, which is extracted hereunder: D “Now the distinction between matters that are directory and matters that are imperative is well known to us all in the common language of the courts at Westminster … A thing has been ordered by the legislature to be done. What is the consequence if it is not done? In the case of statutes that are E said to be imperative, the courts have decided that if it is not done the whole thing fails, and the proceedings that follow upon it are all void. On the other hand, when the courts hold a provision to be mandatory or directory, they say that, although such provision may not have been complied with, the subsequent proceedings do not fail.” F Later Lord Denning M.R. said, at pp. 242-243: “The section is no doubt imperative in that the notice of appeal must be in writing and must be made within the specified time. But I think it is only directory as to the contents. Take first the G requirement as to the ‘grounds’ of appeal. The section is either imperative in requiring ‘the grounds’ to be indicated, or it is not. That must mean all or none. I cannot see any justification for the view that it is imperative as to one ground and not 153 (1998) 6 SCC 554 H

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A imperative as to the rest. If one was all that was necessary, an appellant would only have to put in one frivolous or hopeless ground and then amend later to add his real grounds. That would be a futile exercise. Then as to ‘stating the facts.’ It cannot be supposed that the appellant must at all cost state all the facts on which he bases his appeal. He has to state the facts, not the evidence: and the facts may depend on evidence yet to be obtained, and may not be fully or sufficiently known at the time when the notice of appeal is given. All things, considered, it seems to me that the section, in so far as the ‘grounds’ and ‘facts’ are concerned, must be construed as directory only: that is, as desiring information to be given about them. It is not to be supposed that an appeal should fail altogether simply because the grounds are not indicated, or the facts stated. Even if it is wanting in not giving them, it is not fatal. The defects can be remedied later, either before or at the hearing of the appeal, so long as an opportunity is afforded of dealing with them.” (emphasis supplied)

234Copy pinpoint234. In Belvedere Court Management Ltd. v. Frogmore Developments Ltd.154, a distinction was made between essential and supportive provisions. The following observations are pertinent: “By way of final comment I would add that I am strongly attracted to the view that legislation of the present kind should be evaluated and construed on an analytical basis. It should be considered which of the provisions are substantive and which are secondary, that is, simply part of the machinery of the legislation. Further, the provisions which fall into the latter category should be examined to assess whether they are essential parts of the mechanics or are merely supportive of the other provisions so that they need not be insisted on regardless of the circumstances. In other words, as in the construction of contractual and similar documents, the status and effect of a provision has to be assessed having regard to the scheme of the legislation as a whole and the role of that provision in that scheme – for example, whether some provision confers an option properly so called, whether some H 154 (1996) 3 W.L.R. 1008 at p. 1032

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provision is equivalent to a condition precedent, whether some A requirement can be fulfilled in some other way or waived. Such an approach when applied to legislation such as the present would assist to enable the substantive rights to be given effect to and would help to avoid absurdities or unjustified lacunae.” B (emphasis supplied)

235Copy pinpoint235. In Sharif-ud-Din (supra) the difference between mandatory and directory rules was pointed out thus: “9. The difference between a mandatory rule and a directory rule is that while the former must be strictly observed, in the case of the latter substantial compliance may be sufficient to achieve the object regarding which the rule is enacted. Certain broad propositions which can be deduced from several decisions of courts regarding the rules of construction that should be followed in determining whether a provision of law is directory or mandatory may be summarised thus: The fact that the statute uses the word “shall” while laying down a duty is not conclusive on the question whether it is a mandatory or directory provision. In order to find out the true character of the legislation, the court has to ascertain the object which the provision of law in question has to subserve and its design and the context in which it is enacted. If the object of a law is to be defeated by non-compliance with it, it has to be regarded as mandatory. But when a provision of law relates to the performance of any public duty and the invalidation of any act done in disregard of that provision causes serious prejudice to those for whose benefit it is enacted and at the same time who have no control over the performance of the duty, such provision should be treated as a directory one. Where, however, a provision of law prescribes that a certain act has to be done in a particular manner by a person in order to acquire a right and it is coupled with another provision which confers an immunity on another when such act is not done in that manner, the former has to be regarded as a mandatory one. A procedural rule ordinarily should not be construed as mandatory if the defect in the act done in pursuance of it can be cured by permitting H

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A appropriate rectification to be carried out at a subsequent stage unless by according such permission to rectify the error later on, another rule would be contravened. Whenever a statute prescribes that a particular act is to be done in a particular manner and also lays down that failure to comply with the said requirement leads to a specific consequence, it B would be difficult to hold that the requirement is not mandatory and the specified consequence should not follow.” (emphasis supplied)

236Copy pinpoint236. Similarly, in Ram Deen Maurya (Dr.) v. State of Uttar C Pradesh and Ors155 this Court observed that non-compliance with the directory provision does not affect the validity of the act done in breach thereof. In Rai Vimal Krishna and Ors. v. State of Bihar & Ors. 156, this Court considered the mode of publication and held that publication in a newspaper was the only effective mode and that the provision was mandatory. D

237Copy pinpoint237. This Court also considered the effect of non-deposit of the amount in Hissar Improvement v. Smt. Rukmani Devi and Anr157 and held that in case compensation has not been paid or deposited, the State is liable to pay interest as provided in Section 34. The Court held thus:

E “5. It cannot be gainsaid that interest is due and payable to the landowner in the event of the compensation not being paid or deposited in time in court. Before taking possession of the land, the Collector has to pay or deposit the amount awarded, as stated in Section 31, failing which he is liable to pay interest as provided in Section 34. F

6. In the circumstances, the High Court was right in stating that interest was due and payable to the landowner. The High Court was justified in directing the necessary parties to appear in the executing court for determination of the amount.” G

238Copy pinpoint238. In Kishan Das v. State of U.P158, this Court observed that where land owners themselves delayed the acquisition proceedings, it is 155 (2009) 6 SCC 735 156 (2003) 6 SCC 401 157 1990 Supp SCC 806 158 H (1995) 6 SCC 240

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discretionary for the court to award the interest and they cannot get the premium on their dilatory tactics. This Court stated that: “4. In the light of the operation of the respective provisions of Sections 34 and 28 of the Act, it would be difficult to direct payment of interest. In fact, Section 23(1-A) is a set-off for loss in cases of delayed awards to compensate the person entitled to receive compensation; otherwise a person who is responsible for the delay in disposal of the acquisition proceedings will be paid premium for dilatory tactics. It is stated by the learned counsel for the respondents that the amount of interest was also calculated and total amount was deposited in the account of the appellants by the Land C Acquisition Officer after passing the award, i.e., on 15-11-1976 in a sum of Rs 20,48,615. Under these circumstances, the liability to pay interest would arise when possession of the acquired land was taken and the amount was not deposited. In view of the fact that compensation was D deposited as soon as the award was passed, we do not think that it is a case for us to interfere at this stage.” (emphasis supplied)

239Copy pinpoint239. In D-Block Ashok Nagar (Sahibabad) Plot Holders’ Assn. v. State of U.P.159, it was observed that liability to pay interest under E Section 34 arises from the date of taking possession.

240Copy pinpoint240. It was argued that in fact in many cases, reference was sought as such the amounts being deposited in the treasury were not valid. Reference was sought for higher compensation and landowners had declined to accept the compensation for no good reason they could have received it under protest reserving their right to seek the reference and in case compensation was not paid or deposited, they could have claimed it along with interest as envisaged under Section 34.

241Copy pinpoint241. It is clear that once land is acquired, award passed and possession has been taken, it has vested in the State. It had been allotted to beneficiaries. A considerable infrastructure could have been developed and a third-party interest had also intervened. The land would have been given by the acquiring authorities to the beneficiaries from whose schemes the land had been acquired and they have developed immense 159 (1997) 10 SCC 77 H

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A infrastructure. We are unable to accept the submission that merely by deposit of amount in treasury instead of court, we should invalidate all the acquisitions, which have taken place. That is not what is contemplated under Section 24(2). We are also not able to accept the submission that when law operates these harsh consequences need not be seen by the court. In our opinion, that submission is without merit in as such consequences are not even envisaged on proper interpretation of Section 24(2), as mentioned above.

242Copy pinpoint242. The proviso to Section 24(2) of the Act of 2013, intends that the Collector would have sufficient funds to deposit it with respect to the majority of landholdings. In case compensation has not been paid or deposited with respect to majority of land holdings, all the beneficiaries are entitled for higher compensation. In case money has not been deposited with the Land Acquisition Collector or in the treasury or in court with respect to majority of landholdings, the consequence has to follow of higher compensation as per proviso to Section 24(2) of the Act D of 2013. Even otherwise, if deposit in treasury is irregular, then the interest would follow as envisaged under Section 34 of Act of 1894. Section 24(2) is attracted if acquisition proceeding is not completed within 5 years after the pronouncement of award. Parliament considered the period of 5 years as reasonable time to complete the acquisition proceedings i.e., taking physical possession of the land and payment of E compensation. It is the clear intent of the Act of 2013, that provision of Section 24(2) shall apply to the proceeding which is pending as on the date on which the Act of 2013, has been brought into force and it does not apply to the concluded proceedings. It was urged before us by one of the Counsel that lands in the Raisina Hills and Lutyens’ Zones of F Delhi were acquired in 1913 and compensation has not been paid. The Act of 2013 applies only to the pending proceedings in which possession has not been taken or compensation has not paid and not to a case where proceedings have been concluded long back, Section 24(2) is not a tool to revive those proceedings and to question the validity of taking acquisition proceedings due to which possession in 1960s, 1970s, 1980s G were taken, or to question the manner of deposit of amount in the treasury. The Act of 2013 never intended revival such claims. In case such landowners were interested in questioning the proceedings of taking possession or mode of deposit with the treasury, such a challenge was permissible within the time available with them to do so. They cannot wake from deep slumber and raise such claims in order to defeat the

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acquisition validly made. In our opinion, the law never contemplates -nor permits- misuse much less gross abuse of its provisions to reopen all the acquisitions made after 1984, and it is the duty of the court to examine the details of such claims. There are several litigations before us where landowners, having lost the challenge to the validity of acquisition proceedings and after having sought enhancement of the amount in the reference succeeding in it nevertheless are seeking relief arguing about lapse of acquisition after several rounds of litigation.

243Copy pinpoint243. The expression used in Section 24(1)(b) is ‘where an award under Section 11 has been made”, then ‘such proceedings shall continue’ under the provisions of the said Act of 1894 as if the said Act has not been repealed’. The expression “proceedings shall continue” C indicates that proceedings are pending at the time; it is a present perfect tense and envisages that proceedings must be pending as on the date on which the Act of 2013 came into force. It does not apply to concluded proceedings before the Collector after which it becomes functus officio. Section 24 of the Act of 2013, does not confer benefit in the concluded D proceedings, of which legality if question has to be seen in the appropriate proceedings. It is only in the pending proceedings where award has been passed and possession has not been taken nor compensation has been paid, it is applicable. There is no lapse in case possession has been taken, but amount has not been deposited with respect to majority of land holdings in a pending proceeding, higher compensation under the E Act of 2013 would follow under the proviso to Section 24(2). Thus, the provision is not applicable to any other case in which higher compensation has been sought by way of seeking a reference under the Act of 1894 or where the validity of the acquisition proceedings have been questioned, though they have been concluded. Such case has to be decided on their own merits and the provisions of Section 24(2) are not applicable to such cases. In re: Issue no.4: mode of taking possession under the Act of 1894

244Copy pinpoint244. Section 16 of the Act of 1894 provided that possession of land may be taken by the State Government after passing of an award and thereupon land vest free from all encumbrances in the State Government. Similar are the provisions made in the case of urgency in Section 17(1). The word “possession” has been used in the Act of 1894, whereas in Section 24(2) of Act of 2013, the expression “physical H

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A possession” is used. It is submitted that drawing of panchnama for taking over the possession is not enough when the actual physical possession remained with the landowner and Section 24(2) requires actual physical possession to be taken, not the possession in any other form. When the State has acquired the land and award has been passed, land vests in the State Government free from all encumbrances. The act of vesting of the land in the State is with possession, any person retaining the possession, thereafter, has to be treated as trespasser and has no right to possess the land which vests in the State free from all encumbrances.

245Copy pinpoint245. The question which arises whether there is any difference between taking possession under the Act of 1894 and the expression “physical possession” used in Section 24(2). As a matter of fact, what was contemplated under the Act of 1894, by taking the possession meant only physical possession of the land. Taking over the possession under the Act of 2013 always amounted to taking over physical possession of the land. When the State Government acquires land and drawns up a memorandum of taking possession, that amounts to taking the physical possession of the land. On the large chunk of property or otherwise which is acquired, the Government is not supposed to put some other person or the police force in possession to retain it and start cultivating it till the land is used by it for the purpose for which it has been acquired. E The Government is not supposed to start residing or to physically occupy it once possession has been taken by drawing the inquest proceedings for obtaining possession thereof. Thereafter, if any further retaining of land or any re-entry is made on the land or someone starts cultivation on the open land or starts residing in the outhouse, etc., is deemed to be the trespasser on land which in possession of the State. The possession of trespasser always inures for the benefit of the real owner that is the State Government in the case.

246Copy pinpoint246. It was urged on behalf of acquiring authorities and the states that there is no conflict of opinion with respect to the mode of taking possession in IDA v Shailendra and Pune Municipal Corporation & Anr (supra), and that the latter is not a decision as to the aspect of possession. A two-Judge Bench decision in Shree Balaji Nagar Residential Association (supra) has been overruled in the Indore Development Authority case (supra). The view taken in Indore Development Authority (supra) has to prevail as the decision in Velaxan H

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Kumar (supra), was rendered by a two judge Bench of this court. This A court, however, proceeds to examine the matter afresh as issues have been framed.

247Copy pinpoint247. The concept of possession is complex one. It comprises the right to possess and to exclude others, essential is animus possidendi. Possession depends upon the character of the thing which is possessed. B If the land is not capable of any use, mere non-user of it does not lead to the inference that the owner is not in possession. The established principle is that the possession follows title. Possession comprises of the control over the property. The element of possession is the physical control or the power over the object and intention or will to exercise the power. Corpus and animus are both necessary and have to co-exist. Possession C of the acquired land is taken under the Act of 1894 under Section 16 or 17 as the case may be. The government has a right to acquire the property for public purpose. The stage under Section 16 comes for taking possession after issuance of notification under Section 4(1) and stage of Section 9(1). Under section 16, vesting is after passing of the award on taking possession and under section 17 before passing of the award.

248Copy pinpoint248. Mitra’s “Law of Possession and Ownership of Property”, 2nd Edn., expressions ‘trespass’ and ‘trespasser’ have been dealt with by the learned Author with the help of Words and Phrases, Permanent Edition, West Publishing Co. which has also been quoted with respect to who is a trespasser: “A “trespasser” is a person who enters or remains upon land in the possession of another without a privilege to do so created by the possessor ’s consent or otherwise. In re Wimmer’s Estate, 182 P.2d 119, 121, 111 Utah 444.” F “A “trespasser” is one entering or remaining on land in another’s possession without a privilege to do so created by possessor’s consent, express or implied, or by law. Keesecker v. G.M. Mckelvey Co., 42 N.E. 2d 223, 226, 227, 68 Ohio App. 505.” G

249Copy pinpoint249. One who enters or remains in possession on land of another without a privilege to do so, is also treated as a trespasser. On the strength of Full Bench decision of Patna High Court in S.M. Yaqub v. T.N. Basu160, Mitra, has referred to the observation that the possession should 160 AIR 1949 Pat 146 H

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A not be confused with occupation. A person may be in actual possession of the property without occupying it for a considerable time. The person who has a right to utilise the whole in any way he likes. Possession in part is good enough to infer that the person is in possession of the rest. Learned Author has referred to Jowitt’s Dictionary of English Law, Ed. 1969, so as to explain what constitutes possession. B “There are three requisites of possession. First, there must be actual or potential physical control. Secondly, the physical control is not possession unless accompanied by intention hence if a thing is put into the hand of a sleeping person he has no possession of it. Thirdly, the possibility and intention must be visible or evidence by external signs for if the thing shows no signs of being under the control of anyone, it is not possession.”

250Copy pinpoint250. In order to constitute possession, a person should be in physical control. The same is not possession unless and until the intention is there and thirdly, possibility and intention must be visible; otherwise, it is not possession. Mitra has further dealt with how to determine possession. The relevant extract is quoted hereunder: “36. Who is in possession – Determination of.—In Jones v. Chopman, (1849) 2 Ex. 803: 18 LJ Ex. 456: 76 PR 794; E Maule, J, expounded the doctrine thus: “If there are two persons in a field, each asserting that the field is his, and each doing some act in the assertion of the right of possession, and if the question is, which of these two is in actual possession, I answer, the person who has the title is in actual possession and the other person is a trespasser. F In such a case who is in possession is to be determined by the fact of the title and having the same apparent actual possession; The question as to which of the two really is in possession is G determined by the fact of the possession; following the title, that is by the law, which makes it follow the title.” In Kynoch Limited v. Rowlands, (1912) 1Ch 527; LJ Ch 340; 106 LT 316; per Joyce, J, where his Lordship says:

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“It is a well settled principle with reference to land at all events …… that where possession in fact is underterminate or the evidence is undecisive, possession, in law follows the right to possess. As far back as the time of Littleton it was said, “Where two be in one house or other tenements together to claim the said lands and tenements, and the one claimeth by one title, and the other by another title, the law shall adjudge him in possession that has right to have the possession of the same tenements.” (emphasis supplied)

251Copy pinpoint251. A person with title is considered to be in actual possession. C The other person is a trespasser. The possession in law follows the right to possess as held in Kynoch Limited v. Rowlands161. Ordinarily, the owner of the property is presumed to be in possession and presumption as to possession is in his favour. In Superintendent and Remembrancer of Legal Affairs, West Bengal v. Anil Kumar Bhunja & Ors.,162, this Court observed that possession implies a right and a fact; the right to enjoy annexed to the right of property and the fact of the real intention. It involves the power of control and intent to control. Possession is annexed to right of property. “13. “Possession” is a polymorphous term which may have different meanings in different contexts. It is impossible to work out a completely logical and precise definition of “possession” uniformally applicable to all situations in the contexts of all statutes. Dias and Hughes in their book on Jurisprudence say that if a topic ever suffered from too much theorising it is that of “possession.” Much of this difficulty and confusion is (as pointed out in Salmond’s Jurisprudence, F 12th Edn., 1966) caused by the fact that possession is not purely a legal concept. “Possession,” implies a right and a fact; the right to enjoy annexed to the right of property and the fact of the real intention. It involves power of control and intent to control. (See Dias and Hughes, ibid.) G

14. According to Pollock and Wright, “when a person is in such a relation to a thing that, so far as regards the thing, he can assume, exercise or resume manual 161 (1912) 1Ch 527 162 (1979) 4 SCC 274 H

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A control of it at pleasure, and so far as regards other persons, the thing is under the protection of his personal presence, or in or on a house or land occupied by him or in any receptacle belonging to him and under his control, he is in physical possession of the thing.”

B 15. While recognising that “possession” is not a purely legal concept but also a matter of fact, Salmond (12th Edn., p. 52) describes “possession, in fact”, as a relationship between a person and a thing. According to the learned Author the test for determining “whether a person is in possession of anything is whether he is in general control of it”. C

252Copy pinpoint252. In Ram Dass v. Davinder163, this Court stated that possession and occupation in common parlance may be used interchangeably, but in law possession amounts to holding property as an owner, while to occupy is to keep possession by being present in it. In Bhinka & Ors. v. Charan Singh, Bhinka & Ors. v. Charan Singh164, this court considered the dichotomy between taking and retaining possession. They are mutually exclusive expressions and apply to two different situations. The word ‘taking’ applies to a person taking possession of a land otherwise than in accordance with the provisions of the law, while the word ‘retaining’ applies to a person taking possession in accordance with the provisions of the law, but subsequently retaining the same illegally. In Bhinka & Ors. (supra), as to retaining possession, it was observed: “14. If the appellants did not take possession of the disputed lands, did they retain possession of the same in accordance with the provisions of the law for the time being in force? The F dichotomy between taking and retaining indicates that they are mutually exclusive and apply to two different situations. The word “taking” applies to a person taking possession of a land otherwise than in accordance with the provisions of the law, while the word “retaining” to a person taking possession in accordance with the provisions of the law but G subsequently retaining the same illegally. So construed, the appellants’ possession of the lands being illegal from the inception, they could not be described as persons retaining possession of the said lands in accordance with the provisions 163 (2004) 3 SCC 684 164 H 1959 (Suppl 2) SCR 798

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of any law for the time being in force, so as to be outside the scope of Section 180 of the Act.”

253Copy pinpoint253. Under section 16 of the Act of 1894, vesting of title in the Government, in the land took place immediately upon taking possession. Under Sections 16 and 17 of the Act of 1894, the acquired land became the property of the State without any condition or limitation either as to title or possession. Absolute title thus vested in the State.

254Copy pinpoint254. This Court in V. Chandrasekaran & Anr. v. Administrative Officer & Ors165 dealt with the concept of vesting under the Act of

1894. The facts of the said case indicated that the appellants and the officials of the State and Development Board connived with each other to enable the appellant to grab/encroach upon the public land, which was acquired and falsified the documents so as to construct flats thereon. Considering the gravamen of the fraud, the Chief Secretary of the State was directed to trace out such officials and to take suitable action against each of them. It was also held by this Court that alienation of land subsequent to notification under Section 4(1) is void and no title passes on the basis of such sale deed. This Court held that once land vested in the State free from all encumbrances, it cannot be divested. Once land has been acquired, it cannot be restored to tenure-holders/persons interested, even if it is not used for the purpose for which it is so acquired. Once possession of land has been taken, it vests in the State free from all encumbrances. Under sections 16 and 17, the acquired property becomes the property of the Government without any limitation or condition either as to title or possession. Reliance has been placed on Fruit and Vegetable Merchants Union (supra):

19. That the word “vest” is a word of variable import is shown by provisions of Indian statutes also. For example, Section 56 of the Provincial Insolvency Act (5 of 1920) empowers the court at the time of the making of the order of adjudication or thereafter to appoint a receiver for the property of the insolvent and further provides that “such property shall thereupon vest in such receiver”. The property vests in the receiver for the purpose of administering the estate of the insolvent for the payment of his debts after realising his assets. The property of the insolvent vests in the receiver not for all purposes but only for the purpose of the Insolvency Act and 165 (2012) 12 SCC 133 H

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