In C.A. No. 8819 of 2022-SC- In order to survive test of Article 14, classification must be based on intelligible differentia and should have rational nexus to object sought to be achieved by law: SC
Justices Krishna Murari & S. Ravindra Bhat [20-02-2023]

Read Judgment: RAMESH CHANDRA SHARMA & ORS V. STATE OF UTTAR PRADESH & ORS

Manisimran Kaur

New  Delhi, February 22, 2023: While holding the distinction carved out in the matter of payment of compensation by creating a classification between Pushtaini and Gair-pushtaini landholders to be bad in law,the Supreme Court has held that the Land Acquisition Act does not distinguish between classes of owners, and uniformly provides compensation to all classes of landowners.

The Division Bench of Justice Krishna Murari and Justice S. Ravindra Bhat said, “For any classification to survive the test of Article 14, the classification must be based on intelligible differentia, and it must have a rational nexus to the object sought to be achieved by the law”, while also noting that the object sought to be achieved must also be lawful, and if the object of the law itself is found to be discriminatory, then such discrimination must be struck down, the Court stated. 

Writ Petitions were filed by certain landholders whose land was acquired by NOIDA challenging the decision of the Board of Directors of NOIDA as also the approval granted to the said resolution by the State Government,  whereby a distinction was carved out in the matter of payment of compensation by creating a classification between Pushtaini and Gair-pushtaini landholders. 

The Pushtaini landholders, whose lands were acquired, were given additional compensation @ Rs.3 per sq. yard along with 15% as rehabilitation bonus on the compensation already awarded, as also the 10% area of the acquired land, whereas those who were declared as Gair-pusht xcaini were denied this additional benefit. 

A Division Bench of the High Court dismissed the Writ Petition holding the classification to be reasonable having direct nexus with the object sought to be achieved i.e., rehabilitation of the original residents who are likely to become landless due to the acquisition of their land.

Another bunch of Writ Petitions were filed by the present appellants challenging a similar classification made by the Greater Noida Authority in payment of compensation on the basis of the landholder being Pushtaini and Gair-Pushtaini.

Subsequently, through the impugned judgment the Full Bench answered first  question in negative and  second question in affirmative and upheld the view taken by the Division Bench in the case of Smt. Madhuri Srivasatava Vs. State of U.P. & Ors. The Full Bench held that nothing remains to be decided in the Writ Petitions filed by the present appellants and the same were dismissed.

The subject matter of the petitions were the notifications dated October 3, 2005 and January 5, 2006  issued under Sections 4(1) and Section 6(1) of 1894 Act for acquisition of total area of 580.1734 hectares of the land for plan development situate in different villages falling within the jurisdiction of G. Noida. 

The said notifications, also included the land of the present appellants, who were  challenging the acquisition proceedings mainly on the ground of arbitrarily invoking urgency clause under Sections 17(1) read with Section 17 (4) of the 1894 Act.

The Court was only concerned with the legality and validity of action of G. Noida paid an enhanced compensation to the landholders by carving out an artificial class of Pushtaini landholders from among the same class of landholders whose land was acquired by the same notification for the same purpose. 

In view of the same, the Court noted that the first and foremost thing to be taken note of is that the nature of the challenge in the Writ Petition filed by the appellants before the High Court was based on violation of Article 14, which is a fundamental right enshrined in the Constitution. Such a challenge, irrespective of the existence of any alternative remedy under a statute, cannot put a bar on the jurisdiction of the Constitutional Courts.

Further, specifically in the context of the grant of ex-gratia payment, it is to be noted that the said payment granted to Pushtaini landowners through a separate notification, was assessed, and given, after the agreement was signed by both Pushtaini and Gair-pushtaini Landowners, the Bench held.

The Appellants herein, under those circumstances, could not have challenged the agreement vis a vis the exgratia payment on grounds of violation of Article 14, when no such violation existed at the time of the agreement. No man can be expected to predict a future violation of their rights and file a pre-emptive appeal, the Court noted. 

On the basis of the above-mentioned reasons, the Court was of the considered opinion that the Appellants, because of their signing of the agreement, had not forfeited their right to seek revised compensation, because ,the cause of action accrued to them much after entering into the agreement. The issue was answered accordingly in the negative and in favour of the Appellants.

The Bench noted that in order to assess the validity of the impugned classification, it must be put  through the rigours of Article 14 and see whether it survives the baptism. It is a well established principle of law, that the state, as per Article 14, cannot deny equality before law and equal protection of the law.

Reference was made to the judgments in  Rustom Cavasjee Cooper (Banks Nationalisation) v. Union of India & Navtej Singh Johar & Ors. Vs. Union of India Thr. Secretary, Ministry of Law and Justice.

The Court thus observed, "The Land Acquisition Act does not distinguish between classes of owners, and uniformly provides compensation to all classes of landowners. The classification made between Pushtaini landowners and Gair-pushtaini landowners, on the basis of the reasoning mentioned above, is violative of the law laid down in the Nagpur Improvement Trust and Another vs. Vithal Rao and Other and Article 14 of the Constitution.

In light of the above-mentioned reasoning, the Court was of the opinion that the classification made by both the executive actions is bad in law, and is liable to be set aside. “The Land Acquisition Act does not envisage any differential compensation on the basis of such classification, and hence, this Court must infer the compensation to be provided by the executive actions within the confines of Section 23 of the Act”, the Bench held while allowing the appeals.